EXECUTION VERSION

** 
SECOND AMENDMENT TOSECOND AMENDED AND RESTATED CREDIT AGREEMENT

THIS SECOND AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT (this "Amendment"),dated as of August 3, 2004, is entered into by and among:

(1) WILD OATS MARKETS, INC., a Delaware corporation (the "Borrower");

(2) Each of the financial institutions listed in Schedule I to the Credit Agreement    referred to in Recital A below (collectively, the "Lenders")    constituting Required Lenders; and

(3) WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association ("WFB"),    as the administrative agent for the Lenders (in such capacity, the "Administrative    Agent").

** 
RECITALS

A. The Borrower, the Lenders, the Administrative Agent and WFB in its capacity as L/CIssuer and Swing Line Lender are parties to that certain Second Amended and RestatedCredit Agreement, dated as of February 26, 2003 (as amended by that certain FirstAmendment to Credit Agreement dated as of May 21, 2004, the "Credit Agreement").

B. The Borrower has requested that the Lenders constituting Required Lenders and theAdministrative Agent amend the Credit Agreement in certain respects.

C. The Lenders executing this Amendment and the Administrative Agent are willing to soamend the Credit Agreement upon the terms and subject to the conditions set forth below.

** 
AGREEMENT

NOW, THEREFORE, in consideration of the above recitals and for other good and valuableconsideration, the receipt and adequacy of which are hereby acknowledged, the Borrower,the Lenders executing this Amendment and the Administrative Agent hereby agree as follows:

** 
1. Definitions, Interpretation. All capitalized terms defined above andelsewhere in this Amendment shall be used herein as so defined. Unless otherwise definedherein, all other capitalized terms used herein shall have the respective meanings givento those terms in the Credit Agreement, as amended by this Amendment. The rules ofconstruction set forth in Article I of the Credit Agreement shall, to the extentnot inconsistent with the terms of this Amendment, apply to this Amendment and are herebyincorporated by reference.

** 
2. Amendments to Credit Agreement. Subject to the satisfaction of theconditions set forth in paragraph 4 below, the Credit Agreement is hereby amendedas follows:

(a) Section 1.01 is hereby amended by adding in appropriate alphabetical order a    new definition of the terms "Cash Balances" to read in its entirety as    follows:

"Cash Balances" shall mean, with respect to Borrower and its        Subsidiaries at any time, the remainder, determined on a consolidated basis in accordance        with GAAP, of:

(a) The sum of (i) the unrestricted cash of Borrower and its Subsidiaries at such time            and (ii) the market value of the unrestricted Cash Equivalents of Borrower and its            Subsidiaries at such time;

minus

(b) The Effective Amount of all Loans and L/C Obligations then outstanding under            this Agreement.

(b) Section 5.03(a) is hereby amended to read in its entirety as follows:

(a) Adjusted Leverage Ratio. The Borrower shall not permit the Adjusted Leverage        Ratio as at the end of any Fiscal Quarter to be greater than the following for the        respective periods set forth below:

 

Period

Adjusted Leverage Ratio
Closing Date to and including    March 27, 2004
3.75:1.00
March 28, 2004 to and including June 26,    2004
4.75:1.00
June 27, 2004 to and including    July 2, 2005
5:25:1:00
July 3, 2005 to and including October 1,    2005
4.50:1.00
October 2, 2005 and any time thereafter
4.25:1.00
(c) A new Section 5.03(f) is hereby added immediately after Section 5.03(e)    to read in its entirety as follows:

(f) Cash Balances. Borrower shall not permit at any time through July 2, 2005        the Cash Balances of Borrower and its Subsidiaries to be less than $25,000,000.

** 
3. Representations and Warranties. The Borrower hereby represents andwarrants to the Administrative Agent and the Lenders that the following are true andcorrect on the date of this Amendment and that, after giving effect to the amendments setforth in paragraph 2 above, the following will be true and correct on the EffectiveDate:

(a) The representations and warranties of the Borrower set forth in Article IV    of the Credit Agreement and in the other Credit Documents are true and correct in all    material respects as if made on such date (except for representations and warranties    expressly made as of a specified date, which are true and correct in all material respects    as of such date);

(b) No Default has occurred and is continuing; and

(c) The Credit Agreement, the Security Agreement, the Pledge Agreement and the Guaranty    are in full force and effect.

** 
4. Effective Date. The amendments effected by paragraph 2 above shallbecome effective as of August 3, 2004, subject to receipt by the Lenders executing thisAmendment and the Administrative Agent of this Amendment duly executed by the Borrower,the Lenders constituting Required Lenders and the Administrative Agent, each in form andsubstance satisfactory to the Lenders executing this Amendment, the Administrative Agentand their respective counsel, as applicable:

(a) This Amendment duly executed by the Borrower, the Lenders constituting Required    Lenders and the Administrative Agent;

(b) A letter in the form of Attachment A hereto appropriately completed and duly    executed by each Guarantor (the "Guarantor Consent Letter");

(c) A certificate of the Secretary or an Assistant Secretary (or comparable officer) of    the Borrower, dated the Effective Date, certifying that (i) the certificate of    incorporation and bylaws of the Borrower delivered to the Administrative Agent on the    Closing Date and the effective date of the First Amendment to Credit Agreement dated as of    May 21, 2004 (as applicable) have not been modified since such date and remain in full    force and effect; and (ii) the resolutions of the board of directors of the Borrower    which authorized the execution, delivery and on-going performance by the Borrower of its    obligations under the Credit Agreement (as amended from time to time) remain in full force    and effect;

(d) A certificate of the Secretary or an Assistant Secretary (or comparable officer) of    each Guarantor, dated the Effective Date, certifying (i) the certificate of    incorporation, articles of incorporation, certificate of limited partnership, articles of    organization or comparable document of such Guarantor and the bylaws, partnership    agreement, limited liability company agreement or comparable document of such Guarantor,    in each case delivered to the Administrative Agent on the Closing Date have not been    modified since the Closing Date and remain in full force and effect; and (ii) the    resolutions of the board of directors or other governing body of such Guarantor (or other    comparable enabling action) which authorized the execution, delivery and on-going    performance by such Guarantor of its obligations under the Guaranty remain in full force    and effect;

(e) Receipt by the Administrative Agent on behalf of each Lender that executes this    Amendment on or prior to August 6, 2004, of a non-refundable amendment fee in the amount    of .10% of such Lender’s respective Commitment; and

(f) Such other evidence as the Administrative Agent or any Lender may reasonably    request to establish the accuracy and completeness of the representations and warranties    and the compliance with the terms and conditions contained in this Amendment and the other    Credit Documents.

** 
5. Effect of this Amendment. On and after the Effective Date, each referencein the Credit Agreement and the other Credit Documents to the Credit Agreement shall meanthe Credit Agreement as amended hereby. Except as specifically amended above, (a) theCredit Agreement and the other Credit Documents shall remain in full force and effect andare hereby ratified and confirmed and (b) the execution, delivery and effectiveness ofthis Amendment shall not, except as expressly provided herein, operate as a waiver of anyright, power, or remedy of the Lenders or Agent, nor constitute a waiver of any provisionof the Credit Agreement or any other Credit Document.

** 
6. Miscellaneous.

(a) Counterparts. This Amendment may be executed in any number of identical    counterparts, any set of which signed by all the parties hereto shall be deemed to    constitute a complete, executed original for all purposes.

(b) Headings. Headings in this Amendment are for convenience of reference only    and are not part of the substance hereof.

(c) Governing Law. This Amendment shall be governed by and construed in    accordance with the laws of the State of Colorado without reference to conflicts of law    rules.

IN WITNESS WHEREOF, the Borrower, the Administrative Agent and the Lenders executingthis Amendment have caused this Amendment to be executed as of the day and year firstabove written.

** 
BORROWER: WILD OATS MARKETS, INC.

 

By: /s/ Freya R. Brier 
Name: Freya R. Brier 
Title: Vice Pres. Legal 

 

** 
ADMINISTRATIVE AGENT: WELLS FARGO BANK, NATIONALASSOCIATION

 

By: /s/ Marc Rosenberg 
Name: Marc Rosenberg 
Title: Vice President 

 

By: 

Name: 
Title: 

 

** 
LENDERS: WELLS FARGO BANK, NATIONALASSOCIATION

 

By: /s/ Marc Rosenberg 
Name: Marc Rosenberg 
Title: Vice President 

 

By: 
Name: 
Title: 
 
** ****U.S. BANK NATIONAL ASSOCIATION**
 

By: 
Name: 
Title: 
 

By: 
Name: 
Title: 
 
**VECTRA BANK COLORADO N.A.**
 

By: /s/ Steven Griffith
Name: Steven Griffith
Title: Senior Vice President
 

By: 
Name: 
Title: ** 

BANK OF AMERICA, N.A.**
 

By:  /s/ David R. Barney 
Name: David R. Barney
Title:  Senior Vice President
 

By: 
Name: 
Title: 
 

** 
ATTACHMENT A

GUARANTOR CONSENT LETTER

August 3, 2004

TO: WELLS FARGO BANK, NATIONAL ASSOCIATION,    As Administrative Agent for the Lenders under the Credit Agreement referred to below

1. Reference is made to the following:

(a) The Second Amended and Restated Credit Agreement, dated as of February 26,    2003 (the "Credit Agreement") among Wild Oats Markets, Inc. ("Borrower"),    the financial institutions which are from time to time parties thereto (the "Lenders"),    and Wells Fargo Bank, National Association, as administrative agent for the Lenders (in    such capacity, the "Administrative Agent"), L/C Issuer and Swing Line    Lender;

(b) The Second Amended and Restated Subsidiary Guaranty dated as of February 26, 2003    (the "Guaranty") executed by each of the undersigned (each a "Guarantor,"    and collectively, the "Guarantors") in favor of the Lenders and the    Administrative Agent; and 

(c) The Second Amendment to Second Amended and Restated Credit Agreement dated as of    August 3, 2004 (the "Second Amendment") among the Borrower, the Lenders    constituting Required Lenders and the Administrative Agent.

2. Each Guarantor hereby consents to the Second Amendment. Each Guarantor expresslyagrees that such amendment shall in no way affect or alter the rights, duties, orobligations of Guarantor, the Lenders or the Administrative Agent under the Guaranty.

3. From and after the date hereof, the term "Credit Agreement" as used in theGuaranty shall mean the Credit Agreement, as amended by the Second Amendment.

4. The Guarantors’ consent to the Second Amendment shall not be construed (i) tohave been required by the terms of the Guaranty or any other document, instrument oragreement relating thereto or (ii) to require the consent of the Guarantors in connectionwith any future amendment of the Credit Agreement or any other Credit Document.

IN WITNESS WHEREOF, each Guarantor has executed this Guarantor Consent Letter as of theday and year first written above.

WILD MARKS, INC., a Nevada corporation

 

By:                                                                                    Name:                                                                               Title:                                                                          
 

SPARKY, INC., a Nevada corporation

 

By:                                                                                   Name:                                                                              Title:                                                                         
 

WILD OATS FINANCIAL, INC., a Nevada corporation

 

By:                                                                                   Name:                                                                              Title:                                                                         
 

WILD OATS OF TEXAS, INC., a Texas corporation

 

By:                                                                                   Name:                                                                                   Title:                                                                   **************************