<PAGE>

                                                                  EXHIBIT 10.5.1

Bank of America [LOGO]
================================================================================
                                                          Amendment to Documents

                  AMENDMENT NO. 1 TO BUSINESS LOAN AGREEMENT

     This Amendment No. 1 (the "Amendment") dated as of October 2, 2000, is
between Bank of America, N.A. (the "Bank") and Cost Plus, Inc. (the "Borrower").

                                   RECITALS
                                   --------

     A.   The Bank and the Borrower entered into a certain Business Loan
Agreement dated as of May 19, 2000 (the "Agreement").

     B.   The Bank and the Borrower desire to amend the Agreement.

                                   AGREEMENT
                                   ---------

     1.   Definitions. Capitalized terms used but not defined in this Amendment
          -----------
shall have the meaning given to them in the Agreement.

     2.   Amendments. The Agreement is hereby amended as follows:
          ----------

          2.1  Subparagraph 7.20(f) of the Agreement is amended to read in its
               entirety as follows:

               "(f)     sell, assign, lease, transfer or otherwise dispose of
                        all or a substantial part of the Borrower's business or
                        the Borrower's assets except (i) in the ordinary course
                        of the Borrower's business and (ii) to Cost Plus
                        Marketing Services, Inc. and Cost Plus Management
                        Services, Inc."

          2.2  A new Paragraph 8.13 is added to the Agreement, which reads in
               its entirety as follows:

               "8.13 Guarantors Covenants. Cost Plus Marketing Services, Inc.
               and Cost Plus Management Services, Inc. (the "Guarantors") fail
               to comply with the following covenants:

               (a)      Other Debts. Each Guarantor agrees not to have
                        -----------
                        outstanding or incur any direct or contingent
                        liabilities or capital lease obligations (other than
                        those to the Bank), or become liable for the liabilities
                        of others, without the Bank's written consent, which
                        consent shall not be unreasonably withheld. This does
                        not prohibit:

                        (i)       Acquiring goods, supplies, merchandise, or
                                  services on normal trade credit.

                        (ii)      Endorsing negotiable instruments received in
                                  the usual course of business.

                        (iii)     Obtaining surety bonds in the usual course of
                                  business.

                        (iv)      Liabilities, lines of credit and leases in
                                  existence on the date of this Agreement
                                  disclosed in writing to the Bank prior to
                                  closing and acceptable to the Bank.

                        (v)       Additional debts arising from the finance or
                                  refinance of existing real property of any
                                  Guarantor.

                        (vi)      Other unsecured indebtedness incurred in the
                                  ordinary course of business.

                        (vii)     Additional debts and lease obligations for
                                  business purposes which do not exceed a total
                                  principal amount of Five Hundred Thousand
                                  Dollars ($500,000) outstanding at any one
                                  time.

               (b)      Other Liens. Each Guarantor agrees not to create,
                        -----------
                        assume, or allow any security interest or lien
                        (including judicial liens) on property which such
                        Guarantor now or later owns, except:

                        (i)       Deeds of trusts in favor of the Bank.

                        (ii)      Liens for taxes not yet due.

                        (iii)     Additional purchase money security interests
                                  or purchase money liens in personal property
                                  or real property acquired after the date of
                                  this Agreement which secure indebtedness
                                  permitted by subparagraph (a) of the preceding
                                  paragraph.

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                                       -1-
<PAGE>

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                        (iv)      Liens on the financed or refinanced real
                                  property which secure indebtedness permitted
                                  by subparagraph (a) of the preceding
                                  paragraph.

                        (v)       Liens arising in the ordinary course of any of
                                  the Guarantor's business by operation of law
                                  or regulation, but only if payment in respect
                                  of such lien is not yet due.

                        (vi)      Liens in favor of customs and revenues
                                  authorities which secure payment of customs
                                  duties in connection with the importation of
                                  goods.

                        (vii)     Landlord's liens arising under lease contracts
                                  or by operation of law in the ordinary course
                                  of business which are not delinquent or remain
                                  payable without penalty.

                        (viii)    Additional purchase money security interests
                                  in equipment or other personal property
                                  fixed assets acquired after the date
                                  of this Agreement, if the total principal
                                  amount of debts secured by such liens does
                                  not exceed Five Hundred Thousand Dollars
                                  ($500,000) at any one time.

               (c)      Change of Ownership. Each Guarantor agrees not to
                        -------------------
                        cause, permit, or suffer any material change, direct or
                        indirect, in its capital ownership.

               (d)      Audits. Each Guarantor agrees to allow the Bank and its
                        ------
                        agents to inspect such Guarantor's properties and
                        examine, audit, and make copies of books and records at
                        any reasonable time. If any of such Guarantor's
                        properties, books or records are in the possession of a
                        third party, each Guarantor authorizes that third party
                        to permit the Bank or its agents to have access to
                        perform inspections or audits and to respond to the
                        Bank's requests for information concerning such
                        properties, books and records.

               (e)      Preservation of Rights. Each Guarantor agrees to
                        ----------------------
                        maintain and preserve all rights, privileges, and
                        franchises it now has.

               (f)      Maintenance of Properties. Each Guarantor agrees to make
                        -------------------------
                        any repairs, renewals, or replacements to keep its
                        properties in good working condition.

               (g)      Cooperation. Each Guarantor agrees to take any action
                        -----------
                        reasonably requested by the Bank to carry out the intent
                        of this Agreement.

               (h)      General Business Insurance. Each Guarantor agrees to
                        --------------------------
                        maintain insurance satisfactory to the Bank as to
                        amount, nature and carrier covering property damage
                        (including loss of use and occupancy) to any of its
                        properties, public liability insurance including
                        coverage for contractual liability, product liability
                        and workers' compensation, and any other insurance which
                        is usual for such Guarantor's business.

               (i)      Additional Negative Covenants. Each Guarantor agrees not
                        -----------------------------
                        to, without the Bank's written consent, which consent
                        shall not be unreasonably withheld:

                        (i)       Engage in any business activities
                                  substantially different from any of the
                                  Guarantor's present business.

                        (ii)      liquidate or dissolve any of the Guarantor's
                                  business.

                        (iii)     sell or otherwise dispose of any assets for
                                  less then fair market value, or enter into any
                                  agreement to do so; provided, however, that
                                  sales or other dispositions for less than fair
                                  market value of assets with an aggregate fair
                                  market value not exceeding Three Million
                                  Dollars ($3,000,000) are permitted for each
                                  Guarantor in any fiscal year.

                        (iv)      sell, assign, lease, transfer or otherwise
                                  dispose of all or a substantial part of any of
                                  the Guarantor's business or any of such
                                  Guarantor's assets except (A) in the ordinary
                                  course of such Guarantor's business and (B) to
                                  the Borrower."

     3.   Representations and Warranties. When the Borrower signs this
          ------------------------------
Amendment, the Borrower represents and warrants to the Bank that: (a) there is
no event which is, or with notice or lapse of time or both would be, a default
under the Agreement except those events, if any, that have been disclosed in
writing to the Bank or waived in writing by the Bank, (b) the representations
and warranties in the Agreement are true as of the date of this Amendment as if
made on the date of this Amendment, (c) this Amendment is within the Borrower's
powers, has been duly authorized, and does not conflict with any of the
Borrower's organizational papers, and (d) this Amendment does not conflict with
any law, agreement, or obligation by which the Borrower is bound.

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                                      -2-
<PAGE>

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     4.   Conditions. This Amendment will be effective when the Bank receives
          ----------
the following items, in form and content acceptable to the Bank:

          4.1  This Amendment, duly executed by the Borrower and the Bank.

          4.2  Guaranties signed by Cost Plus Marketing Services, Inc. and Cost
               Plus Management Services, Inc., each in the amount of Fifty
               Million Two Hundred Thousand Dollars ($50,200,000).

          4.3  Corporate Resolution Authorizing Execution of Guaranty certified
               by the Secretary of Cost Plus Marketing Services, Inc. in the
               amount of Fifty Million Two Hundred Thousand Dollars
               ($50,200,000).

          4.4  Corporate Resolution Authorizing Execution of Guaranty certified
               by the Secretary of Cost Plus Management Services, Inc. in the
               amount of Fifty Million Two Hundred Thousand Dollars
               ($50,200,000).

     5.   Effect of Amendment. Except as provided in this Amendment, all of the
          -------------------
terms and conditions of the Agreement shall remain in full force and effect.

     This Amendment is executed as of the date stated at the beginning of this
Amendment.

Bank of America, N.A.                  Cost Plus, Inc.



X /s/ Lisa M. Thomas                   X /s/ John Hoffner
  -------------------------------        -------------------------------------
By:  Lisa M. Thomas                    By:  John Hoffner
     Senior Vice President                  Chief Financial Officer

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                                      -3-
<PAGE>

Bank of America [LOGO]
================================================================================
To:                                                          Continuing Guaranty


     Bank of America, N.A.        Borrowers: Cost Plus, Inc.

                                  Guarantors: Cost Plus Marketing Services, Inc.

     (1)  For valuable consideration, the undersigned ("Guarantors") jointly and
severally unconditionally guarantee and promise to pay to Bank of America, N.A.
("Bank"), or order, on demand, in lawful money of the United States, any and all
indebtedness of Cost Plus, Inc. ("Borrowers") to Bank. The word "indebtedness"
is used herein in its most comprehensive sense and includes any and all
advances, debts, obligations, and liabilities of Borrowers or any one or more of
them to Bank, heretofore, now, or hereafter made, incurred or created, whether
voluntary or involuntary and however arising, whether direct or acquired by Bank
by assignment or succession, whether due or not due, absolute or contingent,
liquidated or unliquidated, determined or undetermined, and whether Borrowers
may be liable individually or jointly with others, or whether recovery upon such
indebtedness may be or hereafter become barred by any statute of limitations, or
whether such indebtedness may be or hereafter become otherwise unenforceable.

     (2)  The liability of Guarantors under this Guaranty (exclusive of
liability under any other guaranties executed by Guarantors) shall not exceed at
any one time the total of (a) Fifty Million Two Hundred Thousand and 00/100
Dollars ($50,200,000.00), for the principal amount of the indebtedness and (b)
all interest, fees, and other costs and expenses relating to or arising out of
the indebtedness or such part of the indebtedness as shall not exceed the
foregoing limitation. Bank may permit the indebtedness to exceed Guarantors'
liability, and may apply any amounts received from any source, other than from
Guarantors, to the unguaranteed portion of the indebtedness. This is a
continuing guaranty relating to any indebtedness, including that arising under
successive transactions which shall either continue the indebtedness or from
time to time renew it after it has been satisfied. Any payment by Guarantors
shall not reduce their maximum obligation hereunder, unless written notice to
that effect be actually received by Bank at or prior to the time of such
payment.

     (3)  If any Borrower is a partnership and any Guarantor is a general
partner of that partnership, then such Guarantor shall not be liable under this
Guaranty for any indebtedness of such Borrower which is secured by real
property; provided, however, that such Guarantor shall remain liable under
partnership law for all the indebtedness of such Borrower.

     (4)  The obligations hereunder are joint and several, and independent of
the obligations of Borrowers, and a separate action or actions may be brought
and prosecuted against Guarantors whether action is brought against Borrowers or
whether Borrowers be joined in any such action or actions; and Guarantors waive
the benefit of any statute of limitations affecting their liability hereunder.

     (5)  Guarantors authorize Bank, without notice or demand and without
affecting their liability hereunder, from time to time, either before or after
revocation hereof, to (a) renew, compromise, extend, accelerate, or otherwise
change the time for payment of, or otherwise change the terms of the
indebtedness or any part thereof, including increase or decrease of the rate of
interest thereon; (b) receive and hold security for the payment of this Guaranty
or any of the indebtedness, and exchange, enforce, waive, release, fail to
perfect, sell, or otherwise dispose of any such security; (c) apply such
security and direct the order or manner of sale thereof as Bank in its
discretion may determine; and (d) release or substitute any one or more of the
endorsers or guarantors.

     (6)  Guarantors waive any right to require Bank to (a) proceed against
Borrowers; (b) proceed against or exhaust any security held from Borrowers; or
(c) pursue any other remedy in Bank's power whatsoever. Guarantors waive any
defense arising by reason of any disability or other defense of Borrowers, or
the cessation from any cause whatsoever of the liability of Borrowers, or any
claim that Guarantors' obligations exceed or are more burdensome than those of
Borrowers. Until the indebtedness shall have been paid in full, even though the
indebtedness is in excess of Guarantors' liability hereunder, Guarantors waive
any right of subrogation, reimbursement indemnification, and contribution
(contractual, statutory, or otherwise) including, without limitation, any claim
or right of subrogation under the Bankruptcy Code (Title 11, United States
Code) or any successor statute, arising from the existence or performance of
this Guaranty and Guarantors waive any right to enforce any remedy which Bank
now has or may hereafter have against Borrowers and waive any benefit of, and
any right to participate in, any security now or hereafter held by Bank.
Guarantors waive all presentments, demands for performance, notices of
nonperformance, protests, notices of protest, notices of dishonor, and notices
of acceptance of this Guaranty and of the existence, creation, or incurring of
new or additional indebtedness.

     (7)  (a) Guarantors understand and acknowledge that if Bank forecloses,
either by judicial foreclosure or by exercise of power of sale, any deed of
trust securing the indebtedness, that foreclosure could impair or destroy any
ability that Guarantors may have to seek reimbursement, contribution, or
indemnification from Borrowers or others based on any right Guarantors may have
of subrogation, reimbursement, contribution, or indemnification for any amounts
paid by Guarantors under this Guaranty. Guarantors further understand and
acknowledge that in the absence of this paragraph, such potential impairment or
destruction of Guarantors' rights, if any, may entitle Guarantors to assert a
defense to this Guaranty based on Section 580d of the California Code of Civil
Procedure as interpreted in Union Bank v. Gradsky, 265 Cal. App. 2d. 40 (1968).
                            ---------------------
By executing this Guaranty, Guarantors freely, irrevocably, and unconditionally:
(i) waive and

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                                      -1-
<PAGE>

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relinquish that defense and agree that Guarantors will be fully liable under
this Guaranty even though Bank may foreclose, either by judicial foreclosure or
by exercise of power of sale, any deed of trust securing the indebtedness; (ii)
agree that Guarantors will not assert that defense in any action or proceeding
which Bank may commence to enforce this Guaranty; (iii) acknowledge and agree
that the rights and defenses waived by Guarantors in this Guaranty include any
right or defense that Guarantors may have or be entitled to assert based upon or
arising out of any one or more of Sections 580a, 580b, 580d, or 726 of the
California Code of Civil Procedure or Section 2848 of the California Civil Code;
and (iv) acknowledge and agree that Bank is relying on this waiver in creating
the indebtedness, and that this waiver is a material part of the consideration
which Bank is receiving for creating the indebtedness.

          (b)  Guarantors waive any rights and defenses that are or may become
available to Guarantors by reason of Sections 2787 to 2855, inclusive, of the
California Civil Code.

          (c)  Guarantors waive all rights and defenses that Guarantors may have
because any of the indebtedness is secured by real property. This means, among
other things: (i) Bank may collect from Guarantors without first foreclosing on
any real or personal property collateral pledged by Borrowers; and (ii) if Bank
forecloses on any real property collateral pledged by Borrowers: (1) the amount
of the indebtedness may be reduced only by the price for which that collateral
is sold at the foreclosure sale, even if the collateral is worth more than the
sale price, and (2) Bank may collect from Guarantors even if Bank, by
foreclosing on the real property collateral, has destroyed any right Guarantors
may have to collect from Borrowers. This is an unconditional and irrevocable
waiver of any rights and defenses Guarantors may have because any of the
indebtedness is secured by real property. These rights and defenses include, but
are not limited to, any rights or defenses based upon Section 580a, 580b, 580d,
or 726 of the California Code of Civil Procedure.

          (d)  Guarantors waive any right or defense they may have at law or
equity, including California Code of Civil Procedure Section 580a, to a fair
market value hearing or action to determine a deficiency judgment after a
foreclosure.

          (e)  No provision or waiver in this Guaranty shall be construed as
limiting the generality of any other waiver contained in this Guaranty.

     (8)  Guarantors acknowledge and agree that they shall have the sole
responsibility for obtaining from Borrowers such information concerning
Borrowers' financial conditions or business operations as Guarantors may
require, and that Bank has no duty at any time to disclose to Guarantors any
information relating to the business operations or financial conditions of
Borrowers.

     (9)  To secure all of Guarantors' obligations hereunder, Guarantors assign
and grant to Bank a security interest in all moneys, securities, and other
property of Guarantors now or hereafter in the possession of Bank, all deposit
accounts of Guarantors maintained with Bank, and all proceeds thereof. Upon
default or breach of any of Guarantors' obligations to Bank, Bank may apply any
deposit account to reduce the indebtedness and may foreclose any collateral as
provided in the Uniform Commercial Code and in any security agreements between
Bank and Guarantors.

    (10)  Any obligations of Borrowers to Guarantors, now or hereafter existing,
including but not limited to any obligations to Guarantors as subrogees of Bank
or resulting from Guarantors' performance under this Guaranty, are hereby
subordinated to the indebtedness. Such obligations of Borrowers to Guarantors if
Bank so requests shall be enforced and performance received by Guarantors as
trustees for Bank, and the proceeds thereof shall be paid over to Bank on
account of the indebtedness, but without reducing or affecting in any manner
the liability of Guarantors under the provisions of this Guaranty.

    (11)  This Guaranty may be revoked at any time by Guarantors in respect to
future transactions, unless there is a continuing consideration as to such
transactions which Guarantors do not renounce. Such revocation shall be
effective upon actual receipt by Bank, at the address shown below or at such
other address as may have been provided to Guarantors by Bank, of written notice
of revocation. Revocation shall not affect any of Guarantors' obligations or
Bank's rights with respect to transactions which precede Bank's receipt of such
notice, regardless of whether or not the indebtedness related to such
transactions, before or after revocation, has been renewed, compromised,
extended, accelerated, or otherwise changed as to any of its terms, including
time for payment or increase or decrease of the rate of interest thereon, and
regardless of any other act or omission of Bank authorized hereunder. Revocation
by any one or more of Guarantors shall not affect any obligations of any
nonrevoking Guarantors. If this Guaranty is revoked, returned, or canceled, and
subsequently any payment or transfer of any interest in property by Borrowers to
Bank is rescinded or must be returned by Bank to Borrowers, this Guaranty shall
be reinstated with respect to any such payment or transfer, regardless of any
such prior revocation, return, or cancellation.

    (12)  Where any one or more of Borrowers are corporations, partnerships, or
limited liability companies, it is not necessary for Bank to inquire into the
powers of Borrowers or of the officers, directors, partners, members, managers,
or agents acting or purporting to act on their behalf, and any indebtedness made
or created in reliance upon the professed exercise of such powers shall be
guaranteed hereunder.

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                                      -2-
<PAGE>

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    (13)  Guarantors authorize Bank to verify or check any information given by
Guarantors to Bank, check Guarantors' credit references, verify employment, and
obtain credit reports. Guarantors acknowledge and agree that the authorizations
provided in this paragraph apply to any individual general partner of any
Guarantor and to any Guarantor's spouse and any such general partner's spouse if
such Guarantor or such general partner is married and lives in a community
property state.

    (14)  Bank may, without notice to Guarantors and without affecting
Guarantors' obligations hereunder, assign the indebtedness and this Guaranty, in
whole or in part. Guarantors agree that Bank may disclose to any assignee or
purchaser, or any prospective assignee or purchaser, of all or part of the
indebtedness any and all information in Bank's possession concerning Guarantors,
this Guaranty, and any security for this Guaranty.

    (15)  Guarantors agree to pay all reasonable attorneys' fees, including
allocated costs of Bank's in-house counsel, and all other costs and expenses
which may be incurred by Bank (a) in the enforcement of this Guaranty or (b) in
the preservation, protection, or enforcement of any rights of Bank in any case
commenced by or against Guarantors under the Bankruptcy Code (Title 11, United
States Code) or any similar or successor statute.

    (16)  Where there is but a single Borrower, or where a single Guarantor
executes this Guaranty, then all words used herein in the plural shall be deemed
to have been used in the singular where the context and construction so require;
and when there is more than one Borrower named herein, or when this Guaranty is
executed by more than one Guarantor, the words "Borrowers" and "Guarantors"
respectively shall mean all and any one or more of them.

    (17)  This Guaranty shall be governed by and construed according to the laws
of the State of California, to the jurisdiction of which the parties hereto
submit.

    (18)  (a) Any controversy or claim between or among the parties, including
but not limited to those arising out of or relating to this Guaranty or any
agreements or instruments relating hereto or delivered in connection herewith
and any claim based on or arising from an alleged tort, shall at the request of
any party be determined by arbitration. The arbitration shall be conducted in
accordance with the United States Arbitration Act (Title 9, U.S. Code),
notwithstanding any choice of law provision in this Guaranty, and under the
Commercial Rules of the American Arbitration Association ("AAA"). The
arbitrators shall give effect to statutes of limitation in determining any
claim, except as expressly waived hereunder by Guarantors. Any controversy
concerning whether an issue is arbitrable shall be determined by the
arbitrators. Judgment upon the arbitration award may be entered in any court
having jurisdiction. The institution and maintenance of an action for judicial
relief or pursuit of a provisional or ancillary remedy shall not constitute a
waiver of the right of any party, including the plaintiff, to submit the
controversy or claim to arbitration if any other party contests such action for
judicial relief.

          (b) Notwithstanding the provisions of subparagraph (a), no controversy
or claim shall be submitted to arbitration without the consent of all parties
if, at the time of the proposed submission, such controversy or claim arises
from or relates to an obligation to Bank which is secured by real property
collateral located in California. If all parties do not consent to submission of
such a controversy or claim to arbitration, the controversy or claim shall be
determined as provided in subparagraph (c).

          (c) A controversy or claim which is not submitted to arbitration as
provided and limited in subparagraphs (a) and (b) shall, at the request of any
party, be determined by a reference in accordance with California Code of Civil
Procedure Section 638 et seq. If such an election is made, the parties shall
                      ------
designate to the court a referee or referees selected under the auspices of the
AAA in the same manner as arbitrators are selected in AAA-sponsored proceedings.
The presiding referee of the panel, or the referee if there is a single referee,
shall be an active attorney or retired judge. Judgment upon the award rendered
by such referee or referees shall be entered in the court in which such
proceeding was commenced in accordance with California Code of Civil Procedure
Sections 644 and 645.

          (d) No provision of this paragraph shall limit the right of any party
to this Guaranty to exercise self-help remedies such as setoff, to foreclose
against or sell any real or personal property collateral or security, or to
obtain provisional or ancillary remedies from a court of competent jurisdiction
before, after, or during the pendency of any arbitration or other proceeding.
The exercise of a remedy does not waive the right of either party to resort to
arbitration or reference. At Bank's option, foreclosure under a deed of trust or
mortgage may be accomplished either by exercise of

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                                      -3-
<PAGE>

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power of sale under the deed of trust or mortgage or by judicial foreclosure.

Date:  October 2, 2000
      -------------------------


Witnessed:                             Cost Plus Marketing Services, Inc.

X  /s/ Jane L. Baughman               X /s/ John F. Hoffner
---------------------------------      ---------------------------------------
Witness                                By:  John F. Hoffner
                                            Chief Financial Officer

200 4th Street, Oakland, CA 94607      200 Fourth Street
---------------------------------      Oakland, CA 94607
Address

X  /s/ Linda S. Cano
---------------------------------
Witness

200 4th Street, Oakland, CA 94607
---------------------------------
Address

Address for Notices:

Bank of America, N.A.
Bay Area Commercial Banking Office #01473
345 Montgomery Street
San Francisco, CA 94104

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                                      -4-
<PAGE>

Bank of America [LOGO]
================================================================================
To:                                                          Continuing Guaranty


     Bank of America, N.A.       Borrowers: Cost Plus, Inc.

                                 Guarantors: Cost Plus Management Services, Inc.

     (1)  For valuable consideration, the undersigned ("Guarantors") jointly and
severally unconditionally guarantee and promise to pay to Bank of America, N.A.
("Bank"), or order, on demand, in lawful money of the United States, any and all
indebtedness of Cost Plus, Inc. ("Borrowers") to Bank. The word "indebtedness"
is used herein in its most comprehensive sense and includes any and all
advances, debts, obligations, and liabilities of Borrowers or any one or more of
them to Bank, heretofore, now, or hereafter made, incurred or created, whether
voluntary or involuntary and however arising, whether direct or acquired by Bank
by assignment or succession, whether due or not due, absolute or contingent,
liquidated or unliquidated, determined or undetermined, and whether Borrowers
may be liable individually or jointly with others, or whether recovery upon such
indebtedness may be or hereafter become barred by any statute of limitations, or
whether such indebtedness may be or hereafter become otherwise unenforceable.

     (2)  The liability of Guarantors under this Guaranty (exclusive of
liability under any other guaranties executed by Guarantors) shall not exceed at
any one time the total of (a) Fifty Million Two Hundred Thousand and 00/100
Dollars ($50,200,000.00), for the principal amount of the indebtedness and (b)
all interest, fees, and other costs and expenses relating to or arising out of
the indebtedness or such part of the indebtedness as shall not exceed the
foregoing limitation. Bank may permit the indebtedness to exceed Guarantors'
liability, and may apply any amounts received from any source, other than from
Guarantors, to the unguaranteed portion of the indebtedness. This is a
continuing guaranty relating to any indebtedness, including that arising under
successive transactions which shall either continue the indebtedness or from
time to time renew it after it has been satisfied. Any payment by Guarantors
shall not reduce their maximum obligation hereunder, unless written notice to
that effect be actually received by Bank at or prior to the time of such
payment.

     (3)  If any Borrower is a partnership and any Guarantor is a general
partner of that partnership, then such Guarantor shall not be liable under this
Guaranty for any indebtedness of such Borrower which is secured by real
property; provided, however, that such Guarantor shall remain liable under
partnership law for all the indebtedness of such Borrower.

     (4)  The obligations hereunder are joint and several, and independent of
the obligations of Borrowers, and a separate action or actions may be brought
and prosecuted against Guarantors whether action is brought against Borrowers or
whether Borrowers be joined in any such action or actions; and Guarantors waive
the benefit of any statute of limitations affecting their liability hereunder.

     (5)  Guarantors authorize Bank, without notice or demand and without
affecting their liability hereunder, from time to time, either before or after
revocation hereof, to (a) renew, compromise, extend, accelerate, or otherwise
change the time for payment of, or otherwise change the terms of the
indebtedness or any part thereof, including increase or decrease of the rate of
interest thereon; (b) receive and hold security for the payment of this Guaranty
or any of the indebtedness, and exchange, enforce, waive, release, fail to
perfect, sell, or otherwise dispose of any such security; (c) apply such
security and direct the order or manner of sale thereof as Bank in its
discretion may determine; and (d) release or substitute any one or more of the
endorsers or guarantors.

     (6)  Guarantors waive any right to require Bank to (a) proceed against
Borrowers; (b) proceed against or exhaust any security held from Borrowers; or
(c) pursue any other remedy in Bank's power whatsoever. Guarantors waive any
defense arising by reason of any disability or other defense of Borrowers, or
the cessation from any cause whatsoever of the liability of Borrowers, or any
claim that Guarantors' obligations exceed or are more burdensome than those of
Borrowers. Until the indebtedness shall have been paid in full, even though the
indebtedness is in excess of Guarantors' liability hereunder, Guarantors waive
any right of subrogation, reimbursement indemnification, and contribution
(contractual, statutory, or otherwise) including, without limitation, any claim
or right of subrogation under the Bankruptcy Code (Title 11, United States
Code) or any successor statute, arising from the existence or performance of
this Guaranty and Guarantors waive any right to enforce any remedy which Bank
now has or may hereafter have against Borrowers and waive any benefit of, and
any right to participate in, any security now or hereafter held by Bank.
Guarantors waive all presentments, demands for performance, notices of
nonperformance, protests, notices of protest, notices of dishonor, and notices
of acceptance of this Guaranty and of the existence, creation, or incurring of
new or additional indebtedness.

     (7)  (a) Guarantors understand and acknowledge that if Bank forecloses,
either by judicial foreclosure or by exercise of power of sale, any deed of
trust securing the indebtedness, that foreclosure could impair or destroy any
ability that Guarantors may have to seek reimbursement, contribution, or
indemnification from Borrowers or others based on any right Guarantors may have
of subrogation, reimbursement, contribution, or indemnification for any amounts
paid by Guarantors under this Guaranty. Guarantors further understand and
acknowledge that in the absence of this paragraph, such potential impairment or
destruction of Guarantors' rights, if any, may entitle Guarantors to assert a
defense to this Guaranty based on Section 580d of the California Code of Civil
Procedure as interpreted in Union Bank v. Gradsky, 265 Cal. App. 2d. 40 (1968).
                            ---------------------
By executing this Guaranty, Guarantors freely, irrevocably, and unconditionally:
(i) waive and

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

                                      -1-
<PAGE>

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

relinquish that defense and agree that Guarantors will be fully liable under
this Guaranty even though Bank may foreclose, either by judicial foreclosure or
by exercise of power of sale, any deed of trust securing the indebtedness; (ii)
agree that Guarantors will not assert that defense in any action or proceeding
which Bank may commence to enforce this Guaranty; (iii)) acknowledge and agree
that the rights and defenses waived by Guarantors in this Guaranty include any
right or defense that Guarantors may have or be entitled to assert based upon or
arising out of any one or more of Sections 580a, 580b, 580d, or 726 of the
California Code of Civil Procedure or Section 2848 of the California Civil Code;
and (iv) acknowledge and agree that Bank is relying on this waiver in creating
the indebtedness, and that this waiver is a material part of the consideration
which Bank is receiving for creating the indebtedness.

          (b)  Guarantors waive any rights and defenses that are or may become
available to Guarantors by reason of Sections 2787 to 2855, inclusive, of the
California Civil Code.

          (c)  Guarantors waive all rights and defenses that Guarantors may have
because any of the indebtedness is secured by real property. This means, among
other things: (i) Bank may collect from Guarantors without first foreclosing on
any real or personal property collateral pledged by Borrowers; and (ii) if Bank
forecloses on any real property collateral pledged by Borrowers: (1) the amount
of the indebtedness may be reduced only by the price for which that collateral
is sold at the foreclosure sale, even if the collateral is worth more than the
sale price, and (2) Bank may collect from Guarantors even if Bank, by
foreclosing on the real property collateral, has destroyed any right Guarantors
may have to collect from Borrowers. This is an unconditional and irrevocable
waiver of any rights and defenses Guarantors may have because any of the
indebtedness is secured by real property. These rights and defenses include, but
are not limited to, any rights or defenses based upon Section 580a, 580b, 580d,
or 726 of the California Code of Civil Procedure.

          (d)  Guarantors waive any right or defense they may have at law or
equity, including California Code of Civil Procedure Section 580a, to a fair
market value hearing or action to determine a deficiency judgment after a
foreclosure.

          (e)  No provision or waiver in this Guaranty shall be construed as
limiting the generality of any other waiver contained in this Guaranty.

     (8)  Guarantors acknowledge and agree that they shall have the sole
responsibility for obtaining from Borrowers such information concerning
Borrowers' financial conditions or business operations as Guarantors may
require, and that Bank has no duty at any time to disclose to Guarantors any
information relating to the business operations or financial conditions of
Borrowers.

     (9)  To secure all of Guarantors' obligations hereunder, Guarantors assign
and grant to Bank a security interest in all moneys, securities, and other
property of Guarantors now or hereafter in the possession of Bank, all deposit
accounts of Guarantors maintained with Bank, and all proceeds thereof. Upon
default or breach of any of Guarantors' obligations to Bank, Bank may apply any
deposit account to reduce the indebtedness and may foreclose any collateral as
provided in the Uniform Commercial Code and in any security agreements between
Bank and Guarantors.

    (10)  Any obligations of Borrowers to Guarantors, now or hereafter existing,
including but not limited to any obligations to Guarantors as subrogees of Bank
or resulting from Guarantors' performance under this Guaranty, are hereby
subordinated to the indebtedness. Such obligations of Borrowers to Guarantors if
Bank so requests shall be enforced and performance received by Guarantors as
trustees for Bank, and the proceeds thereof shall be paid over to Bank on
account of the indebtedness, but without reducing or affecting in any manner
the liability of Guarantors under the provisions of this Guaranty.

    (11)  This Guaranty may be revoked at any time by Guarantors in respect to
future transactions, unless there is a continuing consideration as to such
transactions which Guarantors do not renounce. Such revocation shall be
effective upon actual receipt by Bank, at the address shown below or at such
other address as may have been provided to Guarantors by Bank, of written notice
of revocation. Revocation shall not affect any of Guarantors' obligations or
Bank's rights with respect to transactions which precede Bank's receipt of such
notice, regardless of whether or not the indebtedness related to such
transactions, before or after revocation, has been renewed, compromised,
extended, accelerated, or otherwise changed as to any of its terms, including
time for payment or increase or decrease of the rate of interest thereon, and
regardless of any other act or omission of Bank authorized hereunder. Revocation
by any one or more of Guarantors shall not affect any obligations of any
nonrevoking Guarantors. If this Guaranty is revoked, returned, or canceled, and
subsequently any payment or transfer of any interest in property by Borrowers to
Bank is rescinded or must be returned by Bank to Borrowers, this Guaranty shall
be reinstated with respect to any such payment or transfer, regardless of any
such prior revocation, return, or cancellation.

    (12)  Where any one or more of Borrowers are corporations, partnerships, or
limited liability companies, it is not necessary for Bank to inquire into the
powers of Borrowers or of the officers, directors, partners, members, managers,
or agents acting or purporting to act on their behalf, and any indebtedness made
or created in reliance upon the professed exercise of such powers shall be
guaranteed hereunder.

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                                      -2-
<PAGE>

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

    (13)  Guarantors authorize Bank to verify or check any information given by
Guarantors to Bank, check Guarantors' credit references, verify employment, and
obtain credit reports. Guarantors acknowledge and agree that the authorizations
provided in this paragraph apply to any individual general partner of any
Guarantor and to any Guarantor's spouse and any such general partner's spouse if
such Guarantor or such general partner is married and lives in a community
property state.

    (14)  Bank may, without notice to Guarantors and without affecting
Guarantors' obligations hereunder, assign the indebtedness and this Guaranty, in
whole or in part. Guarantors agree that Bank may disclose to any assignee or
purchaser, or any prospective assignee or purchaser, of all or part of the
indebtedness any and all information in Bank's possession concerning Guarantors,
this Guaranty, and any security for this Guaranty.

    (15)  Guarantors agree to pay all reasonable attorneys' fees, including
allocated costs of Bank's in-house counsel, and all other costs and expenses
which may be incurred by Bank (a) in the enforcement of this Guaranty or (b) in
the preservation, protection, or enforcement of any rights of Bank in any case
commenced by or against Guarantors under the Bankruptcy Code (Title 11, United
States Code) or any similar or successor statute.

    (16)  Where there is but a single Borrower, or where a single Guarantor
executes this Guaranty, then all words used herein in the plural shall be deemed
to have been used in the singular where the context and construction so require;
and when there is more than one Borrower named herein, or when this Guaranty is
executed by more than one Guarantor, the words "Borrowers" and "Guarantors"
respectively shall mean all and any one or more of them.

    (17)  This Guaranty shall be governed by and construed according to the laws
of the State of California, to the jurisdiction of which the parties hereto
submit.

    (18)  (a) Any controversy or claim between or among the parties, including
but not limited to those arising out of or relating to this Guaranty or any
agreements or instruments relating hereto or delivered in connection herewith
and any claim based on or arising from an alleged tort, shall at the request of
any party be determined by arbitration. The arbitration shall be conducted in
accordance with the United States Arbitration Act (Title 9, U.S. Code),
notwithstanding any choice of law provision in this Guaranty, and under the
Commercial Rules of the American Arbitration Association ("AAA"). The
arbitrators shall give effect to statutes of limitation in determining any
claim, except as expressly waived hereunder by Guarantors. Any controversy
concerning whether an issue is arbitrable shall be determined by the
arbitrators. Judgment upon the arbitration award may be entered in any court
having jurisdiction. The institution and maintenance of an action for judicial
relief or pursuit of a provisional or ancillary remedy shall not constitute a
waiver of the right of any party, including the plaintiff, to submit the
controversy or claim to arbitration if any other party contests such action for
judicial relief.

          (b) Notwithstanding the provisions of subparagraph (a), no controversy
or claim shall be submitted to arbitration without the consent of all parties
if, at the time of the proposed submission, such controversy or claim arises
from or relates to an obligation to Bank which is secured by real property
collateral located in California. If all parties do not consent to submission of
such a controversy or claim to arbitration, the controversy or claim shall be
determined as provided in subparagraph (c).

          (c) A controversy or claim which is not submitted to arbitration as
provided and limited in subparagraphs (a) and (b) shall, at the request of any
party, be determined by a reference in accordance with California Code of Civil
Procedure Section 638 et seq. If such an election is made, the parties shall
                      ------
designate to the court a referee or referees selected under the auspices of the
AAA in the same manner as arbitrators are selected in AAA-sponsored proceedings.
The presiding referee of the panel, or the referee if there is a single referee,
shall be an active attorney or retired judge. Judgment upon the award rendered
by such referee or referees shall be entered in the court in which such
proceeding was commenced in accordance with California Code of Civil Procedure
Sections 644 and 645.

          (d) No provision of this paragraph shall limit the right of any party
to this Guaranty to exercise self-help remedies such as setoff, to foreclose
against or sell any real or personal property collateral or security, or to
obtain provisional or ancillary remedies from a court of competent jurisdiction
before, after, or during the pendency of any arbitration or other proceeding.
The exercise of a remedy does not waive the right of either party to resort to
arbitration or reference. At Bank's option, foreclosure under a deed of trust or
mortgage may be accomplished either by exercise of

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                                      -3-
<PAGE>

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

power of sale under the deed of trust or mortgage or by judicial foreclosure.

Date:  October 2, 2000
      -------------------------


Witnessed:                             Cost Plus Management Services, Inc.

X  /s/  Jane L. Baughman               X /s/ John F. Hoffner
---------------------------------      ---------------------------------------
Witness                                By:  John F. Hoffner
                                            Chief Financial Officer

200 4th Street, Oakland, CA 94607      200 Fourth Street
---------------------------------      Oakland, CA 94607
Address

X  /s/ Linda S. Cano
---------------------------------
Witness

200 4th Street, Oakland, CA 94607
---------------------------------
Address

Address for Notices:

Bank of America, N.A.
Bay Area Commercial Banking Office #01473
345 Montgomery Street
San Francisco, CA 94104

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                                      -4-
<PAGE>

Bank of America [LOGO]
================================================================================
                                                            Corporate Resolution
                                               Authorizing Execution of Guaranty

     WHEREAS, Bank of America, N.A. ("Bank") is unwilling to extend or continue
to extend certain financial accommodations to Cost Plus, Inc. ("Borrower"),
unless such obligations are guaranteed, in whole or part, by this corporation up
to and including the amount hereinafter set forth; and

     WHEREAS, it is of a business benefit to this corporation that such
financial accommodations be extended or continue to be extended to Borrower and
the required guaranty be executed;

     NOW, THEREFORE, BE IT RESOLVED, that this corporation guarantee any and all
obligations of Borrower to Bank in an amount which shall not exceed at any one
time the total of (a) Fifty Million Two Hundred Thousand and 00/100 Dollars
($50,200,000.00) for the principal amount of such obligations and (b) all
interest, fees and other costs and expenses relating to or arising out of such
obligations or such part of such obligations as shall not exceed the foregoing
limitation, and such guaranty shall be in addition to amounts guaranteed for
Borrower under any other resolution of this corporation and shall not act to
revoke or alter any such resolutions previously delivered to Bank;

     RESOLVED FURTHER, that

          1.   If only one signature is obtained, any one of the following:
               a.   Murray Dashe, Chief Executive Officer
               b.   John F. Hoffner, Chief Financial Officer
               c.
               d.
               e.
               f.
          2.   If two signatures are obtained, any one of the following:
               a.
               b.
               c.
               d.
               e.
               f.
               together with any one of the following:
               g.
               h.
               i.
               j.
               k.
               l.

of this corporation, acting individually or in any combination as may be set
forth above (the "Authorized Officers"), are hereby authorized and directed, in
the name of this corporation, to execute and deliver to Bank, and Bank is
requested to accept, the guaranty in such form as may be agreed upon by the
Authorized Officers and Bank (the "Guaranty");

     RESOLVED FURTHER, that the Authorized Officers are hereby authorized and
directed as security for the Guaranty to grant in favor of Bank a security
interest in or lien on any real or personal property belonging to or under the
control of this corporation, and to execute and deliver to Bank any and all
security agreements, deeds of trust, mortgages, financing statements, fixture
filings or other instruments, agreements and documents as Bank may require and
the Authorized Officers may approve;

     RESOLVED FURTHER, that any and all of the instruments, agreements and
documents referred to above may contain such recitals, covenants, agreements and
other provisions as Bank may require and the Authorized Officers may approve,
and the execution of such instruments, agreements and documents by the
Authorized Officers shall be conclusive evidence of such approval, and that the
Authorized Officers are authorized from time to time to execute renewals or
extensions of any and all such instruments, agreements and documents;

     RESOLVED FURTHER, that Bank is authorized to act upon these resolutions
until written notice of revocation is received by Bank, and that the authority
hereby granted shall apply with equal force and effect to the successors in
office of the Authorized Officers.

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

                                      -1-
<PAGE>

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

                       CORPORATE SECRETARY'S CERTIFICATE

     I, John F. Hoffner, Secretary of Cost Plus Management Services, Inc., a
corporation organized and existing under the laws of the State of California
(the "Corporation"), hereby certify that the foregoing is a full, true and
correct copy of resolutions of the Board of Directors of the Corporation, duly
and regularly adopted by the Board of Directors of the Corporation in all
respects as required by law and the by-laws of the Corporation on
________________________, _________, at a meeting at which a quorum of the Board
of Directors of the Corporation was present and the requisite number of such
directors voted in favor of said resolutions, or by the unanimous consent in
writing of all members of the Board of Directors of the Corporation to the
adoption of said resolutions.

     I further certify that said resolutions are still in full force and effect
and have not been amended or revoked, and that the specimen signatures appearing
below are the signatures of the officers authorized to sign for the Corporation
by virtue of such resolutions.

     Date: October 2, 2000
          ----------------

AUTHORIZED SIGNATURES:

X /s/ Murray Dashe                         X /s/ John F. Hoffner
 ---------------------------------------    ------------------------------------
Murray Dashe, Chief Executive Officer       John F. Hoffner
                                            Secretary of
X /s/ John F. Hoffner                       Cost Plus Management Services, Inc.
 ---------------------------------------    a California corporation
John F. Hoffner, Chief Financial Officer

X
 ---------------------------------------
                                                  Affix
X                                                 Corporate
 ---------------------------------------          Seal
                                                  Here
X
 ---------------------------------------

X
 ---------------------------------------


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

                                      -2-
<PAGE>

Bank of America [LOGO]
================================================================================
                                                            Corporate Resolution
                                               Authorizing Execution of Guaranty

     WHEREAS, Bank of America, N.A. ("Bank") is unwilling to extend or continue
to extend certain financial accommodations to Cost Plus, Inc. ("Borrower"),
unless such obligations are guaranteed, in whole or part, by this corporation up
to and including the amount hereinafter set forth; and

     WHEREAS, it is of a business benefit to this corporation that such
financial accommodations be extended or continue to be extended to Borrower and
the required guaranty be executed;

     NOW, THEREFORE, BE IT RESOLVED, that this corporation guarantee any and all
obligations of Borrower to Bank in an amount which shall not exceed at any one
time the total of (a) Fifty Million Two Hundred Thousand and 00/100 Dollars
($50,200,000.00) for the principal amount of such obligations and (b) all
interest, fees and other costs and expenses relating to or arising out of such
obligations or such part of such obligations as shall not exceed the foregoing
limitation, and such guaranty shall be in addition to amounts guaranteed for
Borrower under any other resolution of this corporation and shall not act to
revoke or alter any such resolutions previously delivered to Bank;

     RESOLVED FURTHER, that

          1.   If only one signature is obtained, any one of the following:
               a.   Murray Dashe, Chief Executive Officer
               b.   John F. Hoffner, Chief Financial Officer
               c.
               d.
               e.
               f.
          2.   If two signatures are obtained, any one of the following:
               a.
               b.
               c.
               d.
               e.
               f.
               together with any one of the following:
               g.
               h.
               i.
               j.
               k.
               l.

of this corporation, acting individually or in any combination as may be set
forth above (the "Authorized Officers"), are hereby authorized and directed, in
the name of this corporation, to execute and deliver to Bank, and Bank is
requested to accept, the guaranty in such form as may be agreed upon by the
Authorized Officers and Bank (the "Guaranty");

     RESOLVED FURTHER, that the Authorized Officers are hereby authorized and
directed as security for the Guaranty to grant in favor of Bank a security
interest in or lien on any real or personal property belonging to or under the
control of this corporation, and to execute and deliver to Bank any and all
security agreements, deeds of trust, mortgages, financing statements, fixture
filings or other instruments, agreements and documents as Bank may require and
the Authorized Officers may approve;

     RESOLVED FURTHER, that any and all of the instruments, agreements and
documents referred to above may contain such recitals, covenants, agreements and
other provisions as Bank may require and the Authorized Officers may approve,
and the execution of such instruments, agreements and documents by the
Authorized Officers shall be conclusive evidence of such approval, and that the
Authorized Officers are authorized from time to time to execute renewals or
extensions of any and all such instruments, agreements and documents;

     RESOLVED FURTHER, that Bank is authorized to act upon these resolutions
until written notice of revocation is received by Bank, and that the authority
hereby granted shall apply with equal force and effect to the successors in
office of the Authorized Officers.

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

                                      -1-
<PAGE>

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

                       CORPORATE SECRETARY'S CERTIFICATE

     I, John F. Hoffner, Secretary of Cost Plus Marketing Services, Inc., a
corporation organized and existing under the laws of the State of California
(the "Corporation"), hereby certify that the foregoing is a full, true and
correct copy of resolutions of the Board of Directors of the Corporation, duly
and regularly adopted by the Board of Directors of the Corporation in all
respects as required by law and the by-laws of the Corporation on
________________________, _________, at a meeting at which a quorum of the Board
of Directors of the Corporation was present and the requisite number of such
directors voted in favor of said resolutions, or by the unanimous consent in
writing of all members of the Board of Directors of the Corporation to the
adoption of said resolutions.

     I further certify that said resolutions are still in full force and effect
and have not been amended or revoked, and that the specimen signatures appearing
below are the signatures of the officers authorized to sign for the Corporation
by virtue of such resolutions.

     Date: October 2, 2000
          ----------------

AUTHORIZED SIGNATURES:

X /s/ Murray Dashe                         X /s/ John F. Hoffner
 ---------------------------------------    ------------------------------------
Murray Dashe, Chief Executive Officer       John F. Hoffner
                                            Secretary of
X /s/ John F. Hoffner                       Cost Plus Marketing Services, Inc.
 ---------------------------------------    a California corporation
John F. Hoffner, Chief Financial Officer

X
 ---------------------------------------
                                                  Affix
X                                                 Corporate
 ---------------------------------------          Seal
                                                  Here
X
 ---------------------------------------

X
 ---------------------------------------


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

                                      -2-