Exhibit 10.39
                          FIFTH AMENDMENT TO CREDIT AND
                               SECURITY AGREEMENT


     This  Fifth  Amendment,  dated  as of July 1,  1997,  is made by and  among
LaCANASTA OF MINNESOTA,  INC., a Minnesota corporation (the "Borrower"),  SPARTA
FOODS,  INC., a Minnesota  corporation  ("Sparta")  and NORWEST BANK  MINNESOTA,
NATIONAL ASSOCIATION, a national banking association (the "Lender").

                                    Recitals

     The Borrower,  Sparta and the Lender are parties to the Credit and Security
Agreement dated as of December 9, 1994, as supplemented by the First  Supplement
to Credit  Agreement  dated as of  December  13,  1994,  as  amended  by a First
Amendment to Credit  Agreement dated as of April 14, 1995, a Second Amendment to
Credit  Agreement  dated as of September  21, 1995, a Third  Amendment to Credit
Agreement  dated as of April 23,  1996,  and a Fourth  Amendment  to Credit  and
Security  Agreement  dated as of  December  20,  1996 (as  amended,  the "Credit
Agreement").  All  capitalized  terms  used in  these  Recitals  shall  have the
meanings given to them in the Credit Agreement.

     Pursuant to the Credit Agreement, the Lender has made Advances, a Term Loan
and a Capital  Expenditure Loan to the Borrower.  The Borrower's  obligations to
pay the Advances is presently  evidenced by the  Revolving  Note of the Borrower
dated  December  9, 1994,  payable  to the order of the  Lender in the  original
principal amount of $1,200,000.  The Borrower's obligations to pay the Term Loan
is presently  evidenced by the Term Note of the Borrower dated December 9, 1994,
payable  to the  order  of  the  Lender  in the  original  principal  amount  of
$1,784,800.  The Borrower's  obligations to pay the Capital  Expenditure Loan is
presently  evidenced  by the  Capital  Expenditure  Note of the  Borrower  dated
December 20, 1996,  payable to the order of the Lender in the original principal
amount of $473,333.  The current outstanding  principal balance of the Revolving
Note is $791,174.  The current outstanding principal balance of the Term Note is
$1,135,385. The current outstanding principal balance of the Capital Expenditure
Note is $235,281.  The Advances,  the Term Loan and the Capital Expenditure Loan
and all other obligations of the Borrower owing to the Lender are secured, among
other  things,  pursuant to the Credit and  Security  Agreement  of the Borrower
dated as of December 9, 1994.

     The  Borrower  has  requested  that the Lender  increase  the amount of the
Commitment  under  Revolving  Note,  extend a new  term  loan in the  amount  of
$750,000 for the  relocation to the New Brighton  facility,  change the interest
rate on the Notes and amend the  definition  of  Borrowing  Base.  The Lender is
willing  to grant the  Borrower's  request  subject  to the terms of this  Fifth
Amendment.
<PAGE>

     Accordingly, the Borrower and the Lender hereby agree as follows:

     1. Defined Terms.  Terms used in this Fifth  Amendment which are defined in
the Credit  Agreement  shall have the same meanings as defined  therein,  unless
otherwise defined herein.  In addition,  Section 1.01 of the Credit Agreement is
amended  by  adding  or  amending,  as  the  case  may  be,  the  following  new
definitions:

          "`Borrowing  Base' means,  at any time and subject to change from time
     to time in the Lender's sole discretion, the lessor of:

               (a) The Revolving Credit Facility Maximum Amount, or

               (b) the sum of (1) up to  eighty-two  percent  (82%) of  Eligible
          Accounts,  plus (2) up to fifty percent  (50%) of Eligible  Inventory,
          plus (3)  $750,000  for the period  beginning  on the Fifth  Amendment
          Effective Date through  November 1, 1997,  less (4) the total advances
          under Term Loan B, less (5) the amount of any deductible  with respect
          to any insurance coverage insuring the Accounts in effect from time to
          time  (which  deductible  is  $15,000  as of the  date  of  the  Fifth
          Amendment)."

          "`Capital Expenditure Loan' has the meaning as given in Section 2.2(b)
     hereof."

          "`Capital Expenditure Loan Note' means that certain promissory note of
     the  Borrower in the amount of $473,333 to the Lender  dated as of December
     20, 1996.

          "`Fifth  Amendment'  means the Fifth  Amendment to Credit and Security
     Agreement  dated as of July 1,  1997,  among the  Borrower,  Sparta and the
     Lender."

          "`Fifth  Amendment  Effective  Date'  means  the date  that all of the
     conditions in Section 6 of Fifth Amendment have been satisfied."

          "`Lakeville Real Estate' means the commercial property of the Borrower
     located in Lakeville, Minnesota."

          "`Revolving  Credit Facility Maximum Amount' shall mean (i) $2,000,000
     less the  total  advanced  under the Term Loan B  facility  for the  period
     beginning on the Fifth  Amendment  Effective Date through  October 31, 1997
     and  (ii)  $1,200,000  for  the  period  beginning  November  1,  1997  and
     thereafter."
<PAGE>
          "`Revolving Loan Spread' means the percentage set forth below opposite
     the range of Leverage Ratio in which the  Borrower's  Leverage Ratio falls.
     Reductions  and increases in the  percentage  will be determined  quarterly
     upon  receipt of the  Borrower's  financial  statements  as required  under
     Section 6.1(b) of the Credit  Agreement,  but such reductions and increases
     will be applied  retroactively to the beginning of the quarter  immediately
     following  the  quarter  for which  the  determination  was made.  From the
     beginning  of each fiscal  quarter  until such  determination  is made with
     respect  to  that  quarter,  the  Borrower  shall  pay  interest  as if the
     percentage were unchanged from the percentage  applicable at the end of the
     preceding fiscal quarter. If the percentage is determined to have increased
     and the Borrower has thus  underpaid  interest  since the beginning of that
     fiscal quarter,  the Borrower shall pay such  deficiency on demand.  If the
     percentage  is  determined  to have  decreased  and the  Borrower  has thus
     overpaid  interest since the beginning of that fiscal  quarter,  the Lender
     shall credit such overpayment, first, as a prepayment of accrued but unpaid
     interest on the Revolving  Note, and,  second,  as a prepayment of interest
     thereafter  accruing on the Revolving Note.  Notwithstanding the foregoing,
     no  reduction  in the  percentage  will be made if a Default or an Event of
     Default has  occurred  and is  continuing  at the time that such  reduction
     would otherwise be made.

           Leverage Ratio                       Percentage

        3.01 to 1.00 or more                       1.00%

        2.51 to 1.00 or more, but                  0.50% 
          less than 3.01 to 1.00

        1.01 to 1.00 or more, but                  0.25% 
          less than 2.51 to 1.00

        1.00 to 1.00 or below                      0.00%

     As of the March 31, 1997, the  Borrower's  Leverage Ratio was 1.19 to 1.00;
     therefore, as of the Fifth Amendment Effective Date, the Lender will reduce
     the Revolving Loan Spread to 0.25%."

          "`Revolving Note' means the $2,000,000 promissory note of the Borrower
     to the  Lender  in  substantially  the  form  of  Exhibit  A to  the  Fifth
     Amendment."

          "`Term  Loans' means any or all of the Term Loan A, the Term Loan B or
     the Capital Expenditure Loan."

          "`Term Loan A' has the meaning specified in Section 2.2(a) hereof."
<PAGE>
          "`Term Loan A Note' means that certain promissory note of the Borrower
     in the amount of $1,784,800 to the Lender dated as of December 9, 1994."

          "`Term Loan B' has the meaning specified in Section 2.2(d) hereof."

          "`Term Loan B Note' means that certain promissory note of the Borrower
     in the  amount  of  $750,000  to the  Lender in  substantially  the form of
     Exhibit B attached to the Fifth Amendment."

          "`Term Loan Notes' means any or all of the Term Loan A Note,  the Term
     Loan B Note or the Capital Expenditure Loan Note."

          "`Term Loan Spread' means the  percentage set forth below opposite the
     range of  Leverage  Ratio in which the  Borrower's  Leverage  Ratio  falls.
     Reductions  and increases in the  percentage  will be determined  quarterly
     upon  receipt of the  Borrower's  financial  statements  as required  under
     Section 6.1(b) of the Credit  Agreement,  but such reductions and increases
     will be applied  retroactively to the beginning of the quarter  immediately
     following  the  quarter  for which  the  determination  was made.  From the
     beginning  of each fiscal  quarter  until such  determination  is made with
     respect  to  that  quarter,  the  Borrower  shall  pay  interest  as if the
     percentage were unchanged from the percentage  applicable at the end of the
     preceding fiscal quarter. If the percentage is determined to have increased
     and the Borrower has thus  underpaid  interest  since the beginning of that
     fiscal quarter,  the Borrower shall pay such  deficiency on demand.  If the
     percentage  is  determined  to have  decreased  and the  Borrower  has thus
     overpaid  interest since the beginning of that fiscal  quarter,  the Lender
     shall credit such overpayment, first, as a prepayment of accrued but unpaid
     interest on the Term Loan Note,  and,  second,  as a prepayment of interest
     thereafter  accruing on the Term Loan Note.  Notwithstanding the foregoing,
     no  reduction  in the  percentage  will be made if a Default or an Event of
     Default has  occurred  and is  continuing  at the time that such  reduction
     would otherwise be made.

           Leverage Ratio                       Percentage

        3.01 to 1.00 or more                       1.25%

        2.51 to 1.00 or more, but                  0.75%
         less than 3.01 to 1.00

        1.01 to 1.00 or more, but                  0.50%
         less than 2.51 to 1.00

        1.00 to 1.00 or below                      0.25%

     As of the March 31, 1997, the  Borrower's  Leverage Ratio was 1.19 to 1.00;
     therefore, as of the Fifth Amendment Effective Date, the Lender will reduce
     the Term Loan Spread to 0.50%."

          "`Termination Date' means December 31, 1999."
<PAGE>

     2. Term Loan and  Capital  Expenditure  Loans.  Section  2.2 of the  Credit
Agreement is amended in its entirety to read as follows:

          "Section 2.2 Term Loans and Capital Expenditure Loans.

          (a) Term  Loan A. The  Lender  has  made a term  loan to the  Borrower
     before the date of the Fifth Amendment,  the Borrower's  obligations to pay
     which are evidenced by the  promissory  note of the Borrower dated December
     9,  1994,  payable  to the order of the  Lender in the  original  principal
     amount of $1,784,800 (the "Term Loan A Note").  The principal amount of the
     Term  Loan  shall  be  payable  in  thirty-six  (36)  consecutive   monthly
     installments  of  Twenty-One   Thousand  Six  Hundred  Fifty-Eight  Dollars
     ($21,658),  commencing  on January  1,  1997,  with a payment of all unpaid
     principal  and other  obligations  on the  earliest of  termination  of the
     Revolving Credit Facility, demand by the Lender or the Termination Date.

          (b)  Capital   Expenditure   Loan.  The  Lender  has  made  a  capital
     expenditure  loan to the  Borrower  before the date of the Fifth  Amendment
     (the "Capital  Expenditure Loan"), the Borrower's  obligations to pay which
     are evidenced by the  promissory  note of the Borrower  dated  December 20,
     1996,  payable to the order of the Lender in the original  principal amount
     of $473,333 (the "Capital  Expenditure Loan Note"). The principal amount of
     the  Capital   Expenditure   Loan  shall  be  payable  in  thirty-six  (36)
     consecutive  monthly  installments of Six Thousand Three Hundred  Forty-Two
     Dollars  ($6,342),  commencing  on January  1, 1997,  with a payment of all
     unpaid  principal and other  obligations  on the earliest of termination of
     the  Revolving  Credit  Facility,  demand by the Lender or the  Termination
     Date.

          (c) Procedures  for Capital  Expenditure  Loan  Advances.  At any time
     prior to December 31,  1997,  and upon the terms and  conditions  set forth
     below, the Lender agrees to make Advances to the Borrower under the Capital
     Expenditure  Loan to finance new  acquisitions by the Borrower of equipment
     to be located at the Leased  Premises and used in the Borrower's  business,
     in an aggregate amount not to exceed the lesser of (i) Two Hundred Thousand
     Dollars ($200,000.00) or (ii) the lesser of (A) eighty percent (80%) of the
     net invoice hard cost to Borrower for such newly  purchased  equipment (net
     of insurance,  freight,  delivery,  shipping interest, taxes, installation,
     licenses or any similar cost or expense,  and less any discounts,  rebates,
     refunds  or other  reductions  in price),  or (B) the actual  value of such
     equipment,  in the Lender's sole  determination.  Upon  fulfillment  of the
     applicable  conditions  set forth  below for which the Lender  shall have a
     reasonable  period of time to review,  and upon Lender's  determination  to
     make an Advance  under the  Capital  Expenditure  Loan,  the  Lender  shall
     disburse the amount of the Advance by crediting the same to the  Borrower's
     demand  deposit  account  specified in Section  2.1(c)  hereof,  unless the
     Borrower  and the  Lender  shall  agree in  writing  to  another  manner of
<PAGE>

     disbursement.  The Capital Expenditure Loan is not a revolving facility and
     any  voluntary  or  mandatory  prepayment  thereof  may  not be  reborrowed
     hereunder.  The Borrower agrees to comply with the following  procedures in
     requesting Advances under this Section 2.2(c):

               (1) The Lender shall make,  and the Borrower  shall  request,  no
          more than two (2) Advances under this Section 2.2(c), with each of the
          requested  Advances  to be in an  amount  of at least  Fifty  Thousand
          Dollars  ($50,000.00),  and the aggregate of both  requested  Advances
          shall not exceed Two Hundred Thousand Dollars ($200,000.00).

               (2) The request for an Advance under this Section 2.2(c) shall be
          made in writing,  specifying  the date of the requested  Advance which
          shall not be prior to the Lender's  review of the documents  described
          below, and the amount thereof,  and shall be by (i) any officer of the
          Borrower;  (ii) any Person  designated as the Borrower's  agent by any
          officer of the Borrower in a writing delivered to the Lender; or (iii)
          any Person  reasonably  believed by the Lender to be an officer of the
          Borrower or such a designated  agent. Any request for an Advance under
          this  Section  2.2(c)  shall be deemed to be a  representation  by the
          Borrower that (i) the  conditions  set forth in Section  2.2(c) hereof
          have been met, and (ii) the conditions set forth in Section 4.2 hereof
          have been met as of the time of the  request.  The  Borrower  shall be
          obligated   to  repay  all   Advances   under  this   Section   2.2(c)
          notwithstanding  the fact that the Person  requesting the same was not
          in fact authorized to do so.

               (3) Such request shall be  accompanied  by (A) the actual invoice
          and purchase order for the newly acquired equipment; (B) a description
          of such  equipment;  (C) evidence of (i) delivery of such equipment to
          the Borrower and the acceptance thereof by the Borrower, together with
          the dates and place of  acceptance  and  delivery,  (ii) title to such
          equipment in the name of Borrower,  (iii) payment therefor or a letter
          from the  Borrower  directing  the  Lender  to  disburse  the  Advance
          proceeds to the equipment  vendor  directly,  (iv) the Lender's  first
          priority  security  interest in such equipment,  (v) insurance on such
          equipment in form and substance acceptable to the Lender; and (D) such
          other documentation or information as the Lender may require.

          (d) Term Loan B. The Lender has  committed  to make a term loan to the
     Borrower as of the date of the Fifth Amendment,  the Borrower's obligations
     to pay which are evidenced by a promissory  note of the Borrower dated June
     __,  1997,  payable  to the order of the Lender in the  original  principal
     amount of $750,000 (the "Term Loan B Note"),  substantially  in the form of
     Exhibit  B to the Fifth  Amendment  and shall be  secured  pursuant  to the
     Credit  Agreement  and the  Security  Documents  as  therein  defined.  The
     principal amount of the Term Loan B shall be payable in consecutive monthly
     installments  amounting to one-sixtieth  (1/60th) of the principal  balance
     outstanding as of November 1, 1997,  commencing on December 1, 1997, with a
     payment of all unpaid  principal and other  obligations  on the earliest of
     termination of the Revolving Credit  Facility,  demand by the Lender or the
     Termination Date."
<PAGE>
          (e) Procedures for Term Loan B Advances. At any time prior to November
     1, 1997, and upon the terms and conditions set forth below, including,  but
     not  limited to the  delivery  by the  Borrower to the Lender of an updated
     orderly  liquidation  value  appraisal on equipment and a fair market value
     appraisal on the Lakeville Real Estate, which appraisals shall be performed
     by an appraisal firm approved by the Lender and the costs of which shall be
     paid by the  Borrower,  the Lender  agrees to make a single  Advance to the
     Borrower  under the Term Loan B, provided no Default or an Event of Default
     has  occurred  or will occur as a result of the  Advance,  in an  aggregate
     amount not to exceed the lesser of (i) Seven Hundred Fifty Thousand Dollars
     ($750,000.00)  or (ii)  the sum of (A)  eighty  percent  (80%)  of  orderly
     liquidation   value  of  existing   machinery  and   equipment,   plus  (B)
     seventy-five  percent (75%) of the fair market value of the Lakeville  Real
     Estate,  less (C) the outstanding  balance and unfunded  commitments  under
     Term Loan A, less (D) the outstanding balance and unfunded commitment under
     the Capital Expenditure Loan. Upon fulfillment of the applicable conditions
     and upon Lender's  determination  to make an Advance under the Term Loan B,
     the Lender shall  disburse the amount of the Advance by crediting  the same
     to the  Borrower's  demand  deposit  account  specified  in Section  2.1(c)
     hereof,  unless  the  Borrower  and the  Lender  shall  agree in writing to
     another manner of disbursement. The Term Loan B is not a revolving facility
     and any  voluntary or mandatory  prepayment  thereof may not be  reborrowed
     hereunder.

     3. Interest.  Section  2.4(a) of the Credit  Agreement is hereby amended in
its entirety and replaced with the following:
 
          "Section 2.4 Interest.  (a) The principal of the Advances  outstanding
     during any month under the Revolving Credit Facility shall bear interest at
     the Revolving Note Rate, and all other  Obligations  shall bear interest at
     the Term Note Rate; provided, however, that from the first day of any month
     during which any Default or Event of Default  occurs or exists at any time,
     in the Lender's  discretion and without waiving any of its other rights and
     remedies,  the  principal  of  the  Advances  outstanding  and  the  unpaid
     principal balance of the Term Loan A, the Capital  Expenditure Loan and the
     Term Loan B and any other  Obligations  outstanding from time to time shall
     bear interest at the applicable Default Rate; and provided,  further,  that
     in any event no rate change  shall be put into effect which would result in
     a rate greater than the highest rate permitted by law. Interest accruing on
<PAGE>

     the principal  balance of the Advances under the Revolving Credit Facility,
     the  Capital  Expenditure  Loan,  the Term Loan A, the Term Loan B, and any
     other  Obligations  outstanding  from time to time  shall be payable on the
     first  day of the next  succeeding  month  and on the  Termination  Date or
     earlier demand or prepayment in full. All interest  (including  interest at
     the Default  Rate) shall be computed on the basis of actual days elapsed in
     a three hundred sixty (360) day year."

     4. Use of Proceeds.  Section 2.10 of the Credit Agreement is amended in its
entirety as follows:

          "Section  2.10 Use of  Proceeds.  The  proceeds of Advances  under the
     Revolving Credit Facility,  the Term Loans and the Capital Expenditure Loan
     shall  be  used  by  the   Borrower  as  interim   financing  of  leasehold
     improvements  and  capital  equipment  and  for  ordinary  working  capital
     purposes."

     5. Financial Covenants.  Sections 6.12 and 6.13 of the Credit Agreement are
deleted in their entirety and replaced, as follows:

          "Section 6.12  Tangible Net Worth.  The  Borrower,  on a  consolidated
     basis with Sparta,  shall maintain at all times during each fiscal month in
     each period set forth  below  (calculated  at the end of each fiscal  month
     during each period set forth  below) its Tangible Net Worth at or above the
     level set forth below opposite each such period:

       October 1, 1996 through
           August 31, 1997                $1,500,000
      September 1, 1997 through
           August 31, 1998                $1,600,000
      September 1, 1998 through
           August 31, 1999                $2,100,000
      September 1, 1999 through
          December 31, 1999               $2,400,000

          "Section 6.13 Maximum Leverage Ratio. The Borrower,  on a consolidated
     basis with Sparta,  shall maintain at all times during each fiscal month in
     each period set forth  below  (calculated  at the end of each fiscal  month
     during  each  period set forth  below) its  Leverage  Ratio at or below the
     level set forth below opposite each such period:

                                      
<PAGE>

        June 30, 1997 through
           August 31, 1997               2.00 to 1.00
      September 1, 1997 through
           August 31, 1998               2.25 to 1.00
      September 1, 1998 through
           August 31, 1999               1.75 to 1.00
      September 1, 1999 through
          December 31, 1999              1.75 to 1.00

     6.  Expenditures for Fixed Assets.  Section 7.10 of the Credit Agreement is
amended in its entirety to read as follows:

          "Section 7.10 Capital  Expenditures.  Sparta will not make any Capital
     Expenditures.  During each period set forth below,  the  Borrower  will not
     expend or contract to expend for Capital  Expenditures more than the amount
     set forth below opposite each such period:

          Period beginning
        October 1, 1996, and              $3,250,000
      ending September 30, 1998

          Fiscal year ended
         September 30, 1999                $500,000
       October 1, 1999 through
          Termination Date                 $500,000

     7. No Other Changes.  Except as explicitly amended by this Fifth Amendment,
all of the terms and conditions of the Credit Agreement and Revolving Note shall
remain in full force and effect and shall apply to any Advance thereunder.

     8.  Conditions  Precedent.  This Fifth  Amendment  shall be effective  upon
receipt by the Lender of an executed original hereof,  together with each of the
following,  each in  substance  and form  acceptable  to the  Lender in its sole
discretion:

          ( a) The new Revolving Note duly executed by the Borrower.

          ( b) The new Term Loan B Note duly executed by the Borrower.

          ( c) A Certificate  of the Secretary of the Borrower  certifying as to
     (i) the resolutions of the board of directors of the Borrower approving the
     execution and delivery of this Fifth Amendment,  the Revolving Note and the
     Term Loan B Note,  (ii) the fact that the  Articles  of  Incorporation  and
     Bylaws of the  Borrower,  which  were  previously  delivered  to the Lender
     continue  in full force and effect and have not been  amended or  otherwise
     modified except as set forth in the Certificate to be delivered,  and (iii)
     the  incumbency  of the officers and agents of the Borrower  authorized  to
     sign and to act on behalf of the  Borrower  and  setting  forth the  sample
     signatures of each of the officers and agents of the Borrower authorized to
     execute and deliver this Fifth  Amendment,  the Revolving Note and the Term
     Loan B Note and all other documents,  agreements and certificates on behalf
     of the Borrower.

                                      
<PAGE>

          ( d) Evidence that the Borrower has received  final  approval for bond
     financing from the State of Minnesota on terms satisfactory to the Lender.

          ( e) Such other matters as the Lender may require.

     9.  Representations  and  Warranties.  The Borrower  hereby  represents and
warrants to the Lender as follows:

          ( a) The Borrower  has all  requisite  power and  authority to execute
     this Fifth  Amendment,  the Revolving  Note and the Term Loan B Note and to
     perform all of its  obligations  thereunder,  and this Fifth  Amendment has
     been duly executed and delivered by the Borrower and constitutes the legal,
     valid and binding  obligation  of the Borrower,  enforceable  in accordance
     with its terms.

          ( b) The execution,  delivery and  performance by the Borrower of this
     Fifth Amendment, the Revolving Note and the Term Loan B Note have been duly
     authorized  by all  necessary  corporate  action and do not (i) require any
     authorization,   consent  or  approval  by  any  governmental   department,
     commission, board, bureau, agency or instrumentality,  domestic or foreign,
     (ii) violate any  provision of any law, rule or regulation or of any order,
     writ, injunction or decree presently in effect, having applicability to the
     Borrower,  or the articles of incorporation or by-laws of the Borrower,  or
     (iii) result in a breach of or  constitute a default under any indenture or
     loan or credit  agreement or any other  agreement,  lease or  instrument to
     which the Borrower is a party or by which it or its properties may be bound
     or affected.

          ( c) All of the representations and warranties contained in Article IV
     of the Credit  Agreement are correct on and as of the date hereof as though
     made on and as of such date, except to the extent that such representations
     and warranties relate solely to an earlier date.

          ( d) The  recitals  set forth on the first  page  hereof  are true and
     correct.

     10. References.  All references in the Credit Agreement to "this Agreement"
shall be deemed to refer to the Credit Agreement as amended hereby;  and any and
all references in the Mortgage or any Guaranty to the Credit  Agreement shall be
deemed to refer to the Credit Agreement as amended hereby.
<PAGE>
     11. Release.  The Borrower hereby absolutely and  unconditionally  releases
and  forever  discharges  the  Lender,  and  any and  all  participants,  parent
corporations,   subsidiary  corporations,   affiliated  corporations,  insurers,
indemnitors,  successors and assigns  thereof,  together with all of the present
and former  directors,  officers,  agents and employees of any of the foregoing,
from any and all  claims,  demands  or causes  of action of any kind,  nature or
description,  whether arising in law or equity or upon contract or tort or under
any state or federal law or  otherwise,  which the  Borrower has had, now has or
has made  claim to have  against  any such  person  for or by reason of any act,
omission,  matter,  cause or thing whatsoever arising from the beginning of time
to and including the date of this Fifth Amendment,  whether such claims, demands
and causes of action are matured or unmatured or known or unknown.

     12. Costs and Expenses.  The Borrower hereby  reaffirms its agreement under
the Credit  Agreement to pay or reimburse the Lender on demand for all costs and
expenses  incurred by the Lender in connection with the Credit Agreement and all
other  documents   contemplated   thereby,   including  without  limitation  all
reasonable  fees  and  disbursements  of legal  counsel.  Without  limiting  the
generality of the foregoing,  the Borrower  specifically  agrees to pay all fees
and  disbursements  of counsel to the Lender for the services  performed by such
counsel in  connection  with the  preparation  of this Fifth  Amendment  and the
documents and instruments incidental hereto. The Borrower hereby agrees that the
Lender may, at any time or from time to time in its sole  discretion and without
further  authorization  by the Borrower,  make a loan to the Borrower  under the
Credit  Agreement,  or apply the proceeds of any loan, for the purpose of paying
any such fees, disbursements, costs and expenses.

     13.  Miscellaneous.  This Fifth  Amendment may be executed in any number of
counterparts,  each of which when so executed and  delivered  shall be deemed an
original and all of which counterparts, taken together, shall constitute one and
the same instrument.

     IN WITNESS WHEREOF,  the parties hereto have caused this Fifth Amendment to
be duly executed as of the day and year first above written.

LaCANASTA OF MINNESOTA, INC.                NORWEST BANK MINNESOTA, 
                                            NATIONAL ASSOCIATION


By____________________________________      By__________________________________
     A. Merrill Ayers                            _______________________________
     Its Chief Financial Officer                  Its___________________________

SPARTA FOODS, INC.


By____________________________________
     A. Merrill Ayers
     Its Chief Financial Officer

<PAGE>

                                 REVOLVING NOTE

$2,000,000                                              Minneapolis, Minnesota
                                                                  July 1, 1997

     For value  received,  the  undersigned,  LaCANASTA  OF  MINNESOTA,  INC., a
Minnesota   corporation  (the  "Borrower"),   hereby  promises  to  pay  on  the
Termination Date, or on such earlier date as provided in the Credit and Security
Agreement  (defined  below) to the order of  NORWEST  BANK  MINNESOTA,  NATIONAL
ASSOCIATION,  a national banking association (the "Lender"),  at its main office
in Minneapolis,  Minnesota,  or at any other place designated at any time by the
holder  hereof,  in  lawful  money  of  the  United  States  of  America  and in
immediately   available   funds,  the  principal  sum  of  TWO  MILLION  DOLLARS
($2,000,000.00)  or,  if less,  the  aggregate  unpaid  principal  amount of all
advances  made by the Lender to the Borrower  hereunder  or under the  Revolving
Credit  Facility,  as defined in that certain  Credit and Security  Agreement of
even date herewith by and among the Lender, the Borrower and Sparta Foods, Inc.,
(the  "Credit  Agreement")  together  with  interest  on  the  principal  amount
hereunder  remaining  unpaid  from  time to time,  computed  on the basis of the
actual number of days elapsed and a three hundred sixty (360) day year, from the
date hereof until this Note is fully paid at the Revolving  Note Rate or Default
Rate (if  applicable)  from time to time in  effect.  The  principal  hereof and
interest  accruing  thereon  shall be due and  payable as provided in the Credit
Agreement.  This  Note  may be  prepaid  only  in  accordance  with  the  Credit
Agreement.  All  capitalized  terms not otherwise  defined herein shall have the
meanings ascribed thereto in the Credit Agreement.

     This Note is issued  pursuant,  and is  subject,  to the Credit  Agreement,
which provides,  among other things, for acceleration  hereof.  This Note is the
Revolving Note referred to in the Credit Agreement.

     This Note is secured, among other things,  pursuant to the Credit Agreement
and the  Security  Documents  as therein  defined,  and may now or  hereafter be
secured  by one or more other  security  agreements,  mortgages,  deed of trust,
assignments or other instruments or agreements.

     The  Borrower  hereby  agrees  to pay all  costs of  collection,  including
attorneys'  fees and legal expenses in the event this Note is not paid when due,
whether or not legal proceedings are commenced.
<PAGE>

     Presentment or other demand for payment, notice of dishonor and protest are
expressly waived.

     This Note is issued in  substitution  for and  replacement  of,  but not in
satisfaction  of, the  Revolving  Note of the Borrower  dated  December 9, 1994,
payable  to the  order  of  the  Lender  in the  original  principal  amount  of
$1,200,000.

                                      LaCANASTA OF MINNESOTA, INC.


                                      By_______________________________
                                           Its_____________________________



<PAGE>

                                TERM LOAN B NOTE

$750,000                                                Minneapolis, Minnesota
                                                                  July 1, 1997

     For value  received,  the  undersigned,  LaCANASTA  OF  MINNESOTA,  INC., a
Minnesota  corporation  (the  "Borrower"),  hereby promises to pay in accordance
with the terms of the Credit Agreement  (defined below), to the order of Norwest
Bank  Minnesota,  National  Association,  a national  banking  association  (the
"Lender"),  at its main office in Minneapolis,  Minnesota, or at any other place
designated  at any time by the  holder  hereof,  in lawful  money of the  United
States of America and in immediately available funds, the principal sum of SEVEN
HUNDRED FIFTY THOUSAND  DOLLARS  ($750,000)  or, if less,  the aggregate  unpaid
principal  balance of the Term Loan B made by the Lender to the  Borrower  under
that certain  Credit and Security  Agreement of even date  herewith by and among
the Lender,  the  Borrower and Sparta  Foods,  Inc.  (the  "Credit  Agreement"),
together with interest on the principal amount  hereunder  remaining unpaid from
time to time,  computed on the basis of the actual  number of days elapsed and a
360-day  year,  from the date hereof until this Note is fully paid,  at the Term
Note Rate or, if applicable,  the Default Rate, as such terms are defined in the
Credit  Agreement.  The principal hereof and the interest accruing thereon shall
be due and payable as provided in the Credit Agreement. This Note may be prepaid
only in  accordance  with  the  Credit  Agreement.  All  capitalized  terms  not
otherwise  defined herein shall have the meanings ascribed thereto in the Credit
Agreement.

     Interest  accruing  each month shall be due and payable on the first day of
the next  succeeding  month and  otherwise as provided in the Credit  Agreement.
Principal hereof shall be paid in monthly installments and otherwise as provided
in Article I and II of the Credit Agreement, and in one final installment on the
Termination  Date, when the entire unpaid principal  balance hereof shall be due
and payable in full.

     This Note is issued  pursuant,  and is  subject,  to the Credit  Agreement,
which provides,  among other things, for acceleration  hereof.  This Note is the
Term Loan B Note referred to in the Credit Agreement.

     This Note is secured, among other things,  pursuant to the Credit Agreement
and the Security Documents, except for the Mortgage, as therein defined, and may
now or hereafter be secured by one or more other security agreements, mortgages,
deeds of trust, assignments or other instruments or agreements.
<PAGE>

     The  Borrower  hereby  agrees  to pay all  costs of  collection,  including
attorneys' fees and legal expenses, in the event this Note is not paid when due,
whether or not legal proceedings are commenced.

     Presentment or other demand for payment, notice of dishonor and protest are
expressly waived.

                                         LaCANASTA OF MINNESOTA, INC.


                                         By______________________________
                                              Its____________________________
<PAGE>

                    ACKNOWLEDGMENT AND AGREEMENT OF GUARANTOR


     The undersigned, a guarantor of the indebtedness of LaCANASTA OF MINNESOTA,
INC. (the  "Borrower")  to NORWEST BANK  MINNESOTA,  NATIONAL  ASSOCIATION  (the
"Lender")  pursuant  to a separate  Guaranty  dated as of  December 9, 1994 (the
"Guaranty"), hereby (i) acknowledges receipt of the foregoing Fifth Amendment to
Credit and Security Agreement,  the Revolving Note and the Term Loan B Note each
dated July 1, 1997;  (ii)  consents to the terms and  execution  thereof;  (iii)
reaffirms its  obligations to the Lender  pursuant to the terms of its Guaranty;
and (iv)  acknowledges  that the  Lender may amend,  restate,  extend,  renew or
otherwise  modify the Credit  Agreement and any indebtedness or agreement of the
Borrower,  or enter into any  agreement  or extend  additional  or other  credit
accommodations,  without  notifying or obtaining the consent of the  undersigned
and without  impairing the liability of the  undersigned  under its Guaranty for
all of the present and future indebtedness of the Borrower to the Lender.


                                     SPARTA FOODS, INC.


                                    By__________________________________________
                                        A. Merrill Ayers
                                   Its Chief Financial Officer


<PAGE>

                          ACKNOWLEDGMENT AND AGREEMENT

                       OF A. MERRILL AYERS AND JOEL BACHUL
                       -----------------------------------

     The  undersigned,  A.  Merrill  Ayers  executed  and  delivered  a  certain
Performance  Agreement  dated as of December 9, 1994, and the  undersigned  Joel
Bachul executed and delivered a certain Performance  Agreement dated as of April
14, 1995 (such Performance Agreements  collectively called the "Agreement"),  in
favor of Norwest Bank  Minnesota,  N.A. (the "Lender") with respect to LaCanasta
of Minnesota,  Inc. (the  "Borrower"),  and each of the  undersigned  hereby (i)
acknowledges  receipt of the  foregoing  Fifth  Amendment to Credit and Security
Agreement,  the Revolving Note and the Term Loan B Note each dated July 1, 1997;
(ii)  consents  to  the  terms  and  execution  thereof;   (iii)  reaffirms  his
obligations  to the  Lender  pursuant  to the terms of his  Agreement;  and (iv)
acknowledges  that the Lender may amend,  restate,  extend,  renew or  otherwise
modify the Credit  Agreement and any  indebtedness or agreement of the Borrower,
or enter into any agreement or extend additional or other credit accommodations,
without  notifying  or  obtaining  the  consent of the  undersigned  and without
impairing the liability of the undersigned under his Agreement.


                                             --------------------------------
                                             A. Merrill Ayers

                                             --------------------------------
                                             Joel Bachul