BUSINESS LOAN AGREEMENT

        This Agreement dated as of February 28, 1997, is between BANK OF AMERICA
NATIONAL  TRUST AND SAVINGS  ASSOCIATION  (the  "Bank") and CALGENE,  INC.  (the
"Borrower").

1.  DEFINITIONS

In  addition to the terms which are defined  elsewhere  in this  Agreement,  the
following terms have the meanings indicated for the purposes of this Agreement:

     1.1  "Acceptable  Inventory"  means inventory which satisfies the following
requirements:

          (a) The inventory is owned by the Pledgor free of any title defects or
     any liens or interests of others  except the security  interest in favor of
     the Bank;  and the  Pledgor  is the  Borrower;  Stoneville  Pedigreed  Seed
     Company;  Delinting  and Seed  Treating  Co.;  Gargiulo,  Inc.;  or Calgene
     Chemical,  Inc. This does not prohibit any statutory  liens which may exist
     in favor of the growers of agricultural products which are purchased by the
     Pledgor.  Goods  sold  by  the  Borrower  as a  broker  for  other  parties
     ("Brokered  Goods") will not be considered  owned by the Borrower for these
     purposes.

          (b) The  inventory  is  located at  locations  which the  Pledgor  has
     disclosed  to the  Bank  and  which  are  acceptable  to the  Bank.  If the
     inventory is covered by a negotiable document of title (such as a warehouse
     receipt) that document must be delivered to the Bank. Inventory which is in
     transit is not acceptable.

          (c) The  inventory is held for sale or use in the  ordinary  course of
     the Pledgor's  business and is of good and  merchantable  quality.  Display
     items,   work-in-process   and  packing  and  shipping  materials  are  not
     acceptable.  Inventory which is obsolete,  unsalable,  damaged,  defective,
     discontinued or slow-moving, or which has been returned by the buyer and is
     not otherwise  saleable,  is not  acceptable.  Inventory will be considered
     slow-moving if it is aged more than 18 months from its production  date. In
     addition,  carryover  cotton seed inventory  exceeding 30% of the projected
     sales  for  the  year  will  not be  acceptable.  "Carryover"  cotton  seed
     inventory means cotton seed inventory produced in the prior calendar year.

          (d) The inventory has not been manufactured to the specifications of a
     particular account debtor.

          (e) The  inventory is not subject to any  licensing  agreements  which
     would  prohibit  or restrict in any way the ability of the Bank to sell the
     inventory to third parties.

          (f) The inventory is not placed on consignment.

          (g) The inventory is otherwise acceptable to the Bank.

     1.2 "Acceptable Receivable" means an account receivable which satisfies the
following requirements:

          (a) The account has resulted from the sale of goods or the performance
     of  services  by  the  Pledgor  in the  ordinary  course  of the  Pledgor's
     business;  and the  Pledgor  is the  Borrower;  Stoneville  Pedigreed  Seed
     Company;  Delinting  and Seed  Treating  Co.;  Gargiulo,  Inc.;  or Calgene
     Chemical, Inc.

          (b) There are no conditions which must be satisfied before the Pledgor
     is entitled to receive  payment of the account.  Accounts  arising from COD
     sales, consignments or guaranteed sales are not acceptable.

          (c) The debtor upon the account  does not claim any defense to payment
     of the account, whether well founded or otherwise.

          (d)  The  account   balance   does  not  include  the  amount  of  any
     counterclaims  or offsets  which have been or may be  asserted  against the
     Pledgor by the account debtor (including  offsets for any "contra accounts"
     owed by the  Pledgor  to the  account  debtor  for goods  purchased  by the
     Pledgor  or for  services  performed  for the  Pledgor).  To the extent any
     counterclaims,  offsets,  or contra  accounts exist in favor of the debtor,
     such amounts shall be deducted from the account balance.

          (e) The  account  represents  a genuine  obligation  of the debtor for
     goods sold and accepted by the debtor,  or for services  performed  for and
     accepted by the debtor. To the extent any credit balances exist in favor of
     the  debtor,  such  credit  balances  shall be  deducted  from the  account
     balance.

          (f) The Pledgor has sent an invoice to the debtor in the amount of the
     account.

          (g) The Pledgor is not  prohibited  by the laws of the state where the
     account  debtor is located  from  bringing  an action in the courts of that
     state to enforce the debtor's  obligation  to pay the account.  The Pledgor
     has taken all  reasonable  actions  to ensure  access to the  courts of the
     state where the account debtor is located,  including, where necessary, the
     filing of a Notice of Business  Activities  Report or other similar  filing
     with the applicable  state agency or the  qualification by the Pledgor as a
     foreign corporation authorized to transact business in such state.

          (h) The account is owned by the Pledgor  free of any title  defects or
     any liens or interests of others  except the security  interest in favor of
     the Bank.  Accounts  arising  from the sale of  Brokered  Goods will not be
     considered to be owned by the Borrower for these purposes.

          (i) The debtor upon the account is not any of the following:

               (i) an employee,  affiliate, parent or subsidiary of the Pledgor,
          or an entity which has common officers or directors with the Pledgor.

               (ii) the U.S.  government or any agency or department of the U.S.
          government unless the Bank agrees in writing to accept the obligation,
          the Pledgor complies with the procedures in the Federal  Assignment of
          Claims  Act of  1940  (41  U.S.C.  section  15)  with  respect  to the
          obligation,  and  the  underlying  contract  expressly  provides  that
          neither the U.S. government nor any agency or department thereof shall
          have the right of set-off against the Pledgor.

               (iii) any state, county, city, town or municipality.

               (iv) any person or entity located in a country or area other than
          the United  States  unless  either (A) the account is  supported by an
          irrevocable  letter of credit issued by a bank acceptable to the Bank,
          or (B) the account debtor carries an investment  grade rating from Dun
          & Bradstreet of BBB or higher.

          (j) The account is not in default.  An account will be  considered  in
     default if any of the following occur:

               (i) The account is not paid within 60 days from its due date;

               (ii) The debtor  obligated  upon the account  suspends  business,
          makes a general  assignment for the benefit of creditors,  or fails to
          pay its debts generally as they come due; or

               (iii) Any  petition is filed by or against  the debtor  obligated
          upon the account under any bankruptcy law or any other law or laws for
          the relief of debtors;

          (k) The account  does not arise from the sale of goods which remain in
     the Pledgor's possession or under the Pledgor's control.

          (l) The  account  is not  evidenced  by a  promissory  note or chattel
     paper,  nor is the account debtor  obligated to the Pledgor under any other
     obligation which is evidenced by a promissory note.

          (m) The account is otherwise acceptable to the Bank.

In addition to the foregoing limitations, the dollar amount of accounts included
as Acceptable Receivables which are the obligations of a single debtor shall not
exceed the  concentration  limit  established for that debtor. To the extent the
total of such accounts exceeds a debtor's concentration limit, the amount of any
such excess shall be excluded.  The concentration limit for each debtor shall be
equal to 20% of the total amount of the aggregate of all  Pledgors'  accounts at
that time. It is provided,  however,  if the debtor obligated upon an account is
Terra Industries,  Inc., the concentration  limit applicable to such debtor will
be the amount of $7,500,000.

     1.3 "Borrowing Base" means the sum of:

          (a) 80% of the balance due on Acceptable Receivables; and

          (b) 60% of the value of  Acceptable  Inventory  consisting of finished
     goods  comprised of cotton seed  (including bulk cotton seed) and plant oil
     and plant oil-based products (including,  but not limited to, canola, palm,
     and soybean oils).

     In  determining  the value of  Acceptable  Inventory  to be included in the
     Borrowing  Base,  the Bank will use the lowest of (i) the  Pledgor's  cost,
     (ii) the Pledgor's  estimated market value, or (iii) the Bank's independent
     determination  of the resale value of such inventory in such quantities and
     on such terms as the Bank deems appropriate. Prior to multiplying the value
     of Acceptable  Inventory by the percentage rate specified  above,  the Bank
     will  deduct any  amounts  the  Pledgor  owes to  growers  of  agricultural
     products  which the  Pledgor has  purchased  for  processing  or for use in
     producing the inventory.  In addition,  prior to  multiplying  the value of
     Acceptable  Receivables by the percentage  rate specified  above,  the Bank
     will  deduct  any  amounts  the  Pledgor  owes  to  growers  of  perishable
     agricultural  products  (to the extent that such grower  payables  have not
     already been  subtracted  from  Acceptable  Inventory  under the  preceding
     sentence) if such growers would, by timely filing of notice, be entitled to
     the benefits of the federal Perishable Agricultural Commodities Act of 1930
     (7 USC section 499a et seq.) Amounts owed to the growers of Brokered  Goods
     need not be deducted under this paragraph.

     1.4 "Credit  Limit"  means the amount  indicated  for each period set forth
below:

        Period                          Amount

        From the date of this
        Agreement until 12/31/97        $20,000,000

        From 1/1/98 until 12/31/98      $30,000,000

        From 1/1/99 until the
        Expiration Date (as
        defined below)                  $40,000,000

     1.5 "Guarantors" means the following subsidiaries of the Borrower, together
with any future  subsidiary of the Borrower  unless the Bank, in its discretion,
waives the requirement of a guaranty from such subsidiary:  Stoneville Pedigreed
Seed  Company;  Delinting  and Seed  Treating  Co.;  Gargiulo,  Inc.; or Calgene
Chemical, Inc.

     1.6  "Monsanto  Sub Debt" means  Subordinated  Debt owed by the Borrower to
Monsanto Company, including the Monsanto Line of Credit.

     1.7  "Monsanto  Line of  Credit"  means the  existing  line of credit  from
Monsanto  Company to the  Borrower,  with  terms and  conditions  as  previously
disclosed to the Bank.

     1.8  "Pledgor"  means,  with  respect  to  collateral  pledged  under  this
Agreement, the Borrower or Guarantor which owns the collateral.

     1.9  "Subordinated  Debt"  means  indebtedness  subordinated,  in a  manner
acceptable  to  the  Bank,  to all of the  Borrower's  obligations  to the  Bank
pursuant to this Agreement.

2.  LINE OF CREDIT AMOUNT AND TERMS

     2.1 Line of Credit Amount.

          (a) During the  availability  period  described  below,  the Bank will
     provide a line of credit to the Borrower.  The amount of the line of credit
     (the  "Commitment")  is equal to the lesser of (i) the Credit Limit or (ii)
     the Borrowing Base.

          (b) This is a revolving line of credit providing for cash advances and
     financing  overdrafts.  During the  availability  period,  the Borrower may
     repay principal amounts and reborrow them.

          (c) The  Borrower  agrees  not to  permit  the  outstanding  principal
     balance  of  advances  under  the line of  credit  plus the  amount  of the
     Overdraft  Limit (as  defined  below),  to exceed  the  Commitment.  If the
     Borrower  exceeds this limit,  the Borrower will immediately pay the excess
     to the Bank upon the Bank's demand.  The Bank may apply  payments  received
     from the Borrower under this  Paragraph to the  obligations of the Borrower
     to the Bank in the order and the manner as the Bank, in its discretion, may
     determine.

     2.2 Availability  Period.  The line of credit is available between the date
of this  Agreement  and  December  1, 1999 (the  "Expiration  Date")  unless the
Borrower is in default.

     2.3 Interest Rate

          (a) Unless the Borrower elects an optional  interest rate as described
     below,  the interest rate is the Bank's  Reference  Rate minus  one-quarter
     (0.25) of one percentage point.

          (b) The Reference Rate is the rate of interest publicly announced from
     time to time by the Bank in San  Francisco,  California,  as its  Reference
     Rate.  The  Reference  Rate is set by the Bank  based on  various  factors,
     including the Bank's costs and desired return,  general economic conditions
     and other factors, and is used as a reference point for pricing some loans.
     The Bank may price loans to its customers at, above, or below the Reference
     Rate.  Any change in the Reference Rate shall take effect at the opening of
     business on the day specified in the public announcement of a change in the
     Bank's Reference Rate.

     2.4 Repayment Terms

          (a) The  Borrower  will pay  interest  on the first day of each  month
     until  payment  in full of any  principal  outstanding  under  this line of
     credit.

          (b) The  Borrower  will  repay in full all  principal  and any  unpaid
     interest or other  charges  outstanding  under this line of credit no later
     than the Expiration Date.

     2.5 Optional  Interest  Rates.  Instead of the  interest  rate based on the
Bank's Reference Rate, the Borrower may elect the optional interest rates listed
below  during  interest  periods  agreed  to by the Bank and the  Borrower.  The
optional  interest rates shall be subject to the terms and conditions  described
later in this Agreement.  Any principal  amount bearing  interest at an optional
rate under this Agreement is referred to as a "Portion." The following  optional
interest rates are available, as described in Article 3:

          (a) Fixed Rates.

          (b) the LIBOR Rate plus one and one-half (1.5) percentage points.

     2.6 Overdraft Financing Facility

          (a)  This  line  of  credit  may  be  used  to pay  overdrafts  in the
     Borrower's  checking  accounts.   The  total  amount  of  all  unreimbursed
     overdrafts  outstanding at any one time may not exceed One Million  Dollars
     ($1,000,000)  (the "Overdraft  Limit").  This portion of the line of credit
     may only be accessed through this overdraft  facility.  The total amount of
     all other  credit  outstanding  at any time may not exceed the  Commitment,
     minus the Overdraft Limit.

          (b) The checking  accounts  which the Borrower may overdraw are listed
     below, together with the allocated Overdraft Limit for each account:

        Account Number          Overdraft Limit
        14899-02502             $1,000,000

          (c) As  part of the  monthly  calculation  of  service  charges  to be
     assessed against the Borrower's account,  the Bank will include an interest
     charge   calculated  on  the  daily  amount  of   unreimbursed   overdrafts
     outstanding in the account. The interest rate will be an annual rate of the
     Bank's Reference Rate minus one-quarter (0.25) of one percentage point.

          (d) If  items  are  presented  against  an  account  covered  by  this
     overdraft  facility  which, if paid,  would exceed the allocated  Overdraft
     Limit  for that  account,  the Bank will  have no  obligation  to pay those
     items,  but may at its discretion  pay any or all of the items.  The excess
     amount of unreimbursed  overdrafts outstanding which exceeds the applicable
     limits will incur  interest at the  greater of (i) the rate  specified  for
     overdrafts above or (ii) 120% of the Bank's Reference Rate.

          (e) The Bank or the Borrower may, at its discretion,  at any time upon
     10 days  written  notice  to the  other  party,  terminate  this  overdraft
     facility and require repayment of all outstanding overdrafts.  The Borrower
     will in any  event  repay  all  outstanding  overdrafts  no later  than the
     Expiration Date.

          (f) For the  purposes of this  Agreement,  the amount of  unreimbursed
     overdrafts  outstanding  on any day will  equal  the  daily  net  collected
     balance  of the  account  on any day when  such  balance  is  negative.  In
     calculating the amount of interest accruing under this facility,  the daily
     net collected balance will not include provisional credits for items in the
     process of collection  ("Uncollected Items") as determined under the Bank's
     normal  practices  for the  Borrower's  account.  However,  in  determining
     whether the Borrower has exceeded the Overdraft Limit,  the Commitment,  or
     any other dollar limits on borrowing  established  in this  Agreement,  the
     Borrower  shall be given credit for such  Uncollected  Items.  The negative
     daily net  collected  balance may include fees and charges  which have been
     posted to the Borrower's  account,  including  overdraft  interest charges.
     This may result in compounding of interest.

          (g) The Borrower agrees that overdraft interest charges and other fees
     and charges  relating to its  accounts  may be  directly  debited  from its
     accounts.

          (h) The  Bank  may  terminate  this  overdraft  facility  if a levy is
     imposed on any account covered by this facility.

3.  OPTIONAL INTEREST RATES

     3.1  Optional  Rates.  Each  optional  interest  rate is a rate  per  year.
Interest  will be paid on the  last day of each  interest  period,  and,  if the
interest  period is longer  than one month,  then on the first day of each month
during the interest period. At the end of any interest period, the interest rate
will revert to the rate based on the  Reference  Rate,  unless the  Borrower has
designated  another optional  interest rate for the Portion.  No Portion will be
converted to a different  interest rate during the applicable  interest  period.
Upon the  occurrence of an event of default under this  Agreement and so long as
such default has not been cured,  the Bank may  terminate  the  availability  of
optional  interest  rates for  interest  periods  commencing  after the  default
occurs.

     3.2 Fixed  Rate.  The  election  of Fixed  Rates  shall be  subject  to the
following terms and requirements:

          (a) The "Fixed  Rate" means the fixed  interest  rate the Bank and the
     Borrower agree will apply during the applicable interest period.

          (b) The interest  period during which the Fixed Rate will be in effect
     will be one year or less.

          (c) Each  Fixed Rate  Portion  will be for an amount not less than the
     following:

               (i) for  interest  periods  of 14 days or  longer,  Five  Hundred
          Thousand Dollars ($500,000).

               (ii) for  interest  periods of  between 1 and 13 days,  an amount
          which,  when  multiplied  by the  number  of  days  in the  applicable
          interest  period,  is  not  less  than  fifteen  million  (15,000,000)
          dollar-days.

          (d) Each  prepayment of a Fixed Rate Portion,  whether  voluntary,  by
     reason of acceleration  or otherwise,  will be accompanied by the amount of
     accrued  interest on the amount prepaid,  and a prepayment fee as described
     below. A "prepayment"  is a payment of an amount on a date earlier than the
     scheduled  payment date for such amount as required by this Agreement.  The
     prepayment fee shall be equal to the amount (if any) by which:

               (i) the additional  interest which would have been payable during
          the  interest  period on the amount  prepaid had it not been  prepaid,
          exceeds

               (ii) the interest  which would have been  recoverable by the Bank
          by placing the amount  prepaid on deposit in the domestic  certificate
          of deposit market, the eurodollar deposit market, or other appropriate
          money market selected by the Bank for a period starting on the date on
          which it was prepaid and ending on the last day of the interest period
          for  such  Portion  (or the  scheduled  payment  date  for the  amount
          prepaid, if earlier).

     3.3 LIBOR  Rate.  The  election  of the LIBOR  Rate shall be subject to the
following terms and requirements:

          (a) The interest  period during which the LIBOR Rate will be in effect
     will be one, two, three, four, five, six, seven,  eight, nine, ten, eleven,
     or twelve months.  The first day of the interest period must be a day other
     than a  Saturday  or a Sunday  on which  the Bank is open for  business  in
     California,  New York and London and dealing in offshore  dollars (a "LIBOR
     Banking Day"). The last day of the interest period and the actual number of
     days during the interest  period will be  determined  by the Bank using the
     practices of the London inter-bank market.

          (b) Each LIBOR Rate  Portion  will be for an amount not less than Five
     Hundred Thousand Dollars ($500,000).

          (c) The  "LIBOR  Rate"  means the  average  per annum  interest  rate,
     rounded upward to the nearest 1/100 of one percent,  of rates at which U.S.
     dollar  deposits  would be offered for the  applicable  interest  period by
     major banks in the London inter-bank  market, as shown on the Telerate Page
     3750 (or such other page as may  replace  it) at  approximately  11:00 a.m.
     London  time two (2) London  Banking  Days before the  commencement  of the
     interest period. If such rate does not appear on the Telerate Page 3750 (or
     such other page that may replace  it),  the rate for that  interest  period
     will be determined by such alternate method as reasonably selected by Bank.
     A "London  Banking Day" is a day on which the Bank's  London Branch is open
     for  business  and  dealing  in  offshore  dollars.   All  amounts  in  the
     calculation  will be  determined  by the  Bank as of the  first  day of the
     interest period.

          (d) The  Borrower  shall  irrevocably  request a LIBOR Rate Portion no
     later than 12:00 noon San Francisco time on the LIBOR Banking Day preceding
     the day on  which  the  London  Inter-Bank  Offered  Rate  will be set,  as
     specified above.

          (e) Any Portion of the principal  balance already bearing  interest at
     the  LIBOR  Rate will not be  converted  to a  different  rate  during  its
     interest period.

          (f) Each  prepayment of a LIBOR Rate Portion,  whether  voluntary,  by
     reason of acceleration  or otherwise,  will be accompanied by the amount of
     accrued  interest on the amount  prepaid and a prepayment  fee as described
     below. A "prepayment"  is a payment of an amount on a date earlier than the
     scheduled  payment date for such amount as required by this Agreement.  The
     prepayment fee shall be equal to the amount (if any) by which:

               (i) the additional  interest which would have been payable during
          the  interest  period on the amount  prepaid had it not been  prepaid,
          exceeds

               (ii) the interest  which would have been  recoverable by the Bank
          by placing the amount  prepaid on deposit in the domestic  certificate
          of deposit market, the eurodollar deposit market, or other appropriate
          money market  selected by the Bank, for a period  starting on the date
          on which it was  prepaid  and  ending on the last day of the  interest
          period for such Portion (or the scheduled  payment date for the amount
          prepaid, if earlier).

          (g) The Bank will have no obligation to accept an election for a LIBOR
     Rate Portion if any of the following  described  events has occurred and is
     continuing:

               (i) Dollar  deposits  in the  principal  amount,  and for periods
          equal  to the  interest  period,  of a  LIBOR  Rate  Portion  are  not
          available in the London inter-bank market; or

               (ii) the LIBOR  Rate does not  accurately  reflect  the cost of a
          LIBOR Rate Portion.

4.  FEES, AND EXPENSES

     4.1  Unused  Commitment  Fee.  The  Borrower  agrees  to  pay a fee  on any
difference  between the Credit Limit and the amount of credit it actually  uses,
determined  by the weighted  average  credit  outstanding  during the  specified
period.  The fee will be  calculated  at 0.20% per year.  This fee is due on the
first day of each month until the Expiration Date.

     4.2  Expenses.  The  Borrower  agrees  to  immediately  repay  the Bank for
reasonable expenses that include, but are not limited to, filing,  recording and
search fees, and title report fees.

     4.3 Reimbursement Costs.

          (a) The  Borrower  agrees  to  reimburse  the Bank for any  reasonable
     expenses it incurs in the  preparation  of this Agreement and any agreement
     or instrument  required by this Agreement.  Expenses  include,  but are not
     limited to,  reasonable  attorneys' fees,  including any allocated costs of
     the Bank's in-house counsel.

          (b) The Borrower  agrees to reimburse the Bank for the reasonable cost
     of periodic  audits of the  collateral  securing  this  Agreement,  at such
     intervals as the Bank may reasonably require;  provided,  however, that the
     Borrower  shall not be required to reimburse  the Bank for more than 2 such
     audits (in  addition to the  pre-closing  audit)  unless  there has been an
     event of default under this Agreement, with each such audit costing no more
     than $10,000.

5.  COLLATERAL

     The  Borrower's  and the  Guarantors'  obligations  to the Bank  under this
Agreement  will be secured by personal  property the Borrower and Guarantors now
own or will own in the future as listed below. The collateral is further defined
in security agreement(s)  executed by the Borrower and Guarantors.  In addition,
all personal property  collateral  securing this Agreement shall also secure all
other present and future  obligations  of the Borrower to the Bank. All personal
property  collateral  securing any other  present or future  obligations  of the
Borrower to the Bank shall also secure this Agreement.

          (a) A blanket lien on machinery and equipment.

          (b) Inventory.

          (c) Receivables.

6.  DISBURSEMENTS, PAYMENTS AND COSTS

     6.1  Requests  for Credit.  Each request for an extension of credit will be
made in  writing  in a  manner  acceptable  to the  Bank,  or by  another  means
acceptable to the Bank.

     6.2  Disbursements  and Payments.  Each  disbursement  by the Bank and each
payment by the Borrower will be:

          (a) made at the Bank's branch (or other location) selected by the Bank
     from time to time;

          (b) made for the  account of the Bank's  branch  selected  by the Bank
     from time to time;

          (c) made in immediately  available  funds, or such other type of funds
     selected by the Bank;

          (d) evidenced by records kept by the Bank. In addition,  the Bank may,
     at its  discretion,  require the  Borrower  to sign one or more  promissory
     notes.

     6.3 Telephone and Telefax Authorization.

          (a) The Bank may honor telephone or telefax  instructions for advances
     or repayments or for the  designation  of optional  interest rates given by
     any one of the individuals  authorized to sign loan agreements on behalf of
     the  Borrower,  or any  other  individual  designated  by any  one of  such
     authorized signers.

          (b) Advances  will be deposited  in and  repayments  will be withdrawn
     from  the  Borrower's  account  number  14899-02502,  or such  other of the
     Borrower's accounts with the Bank as designated in writing by the Borrower.

          (c) The  Borrower  indemnifies  and  excuses the Bank  (including  its
     officers,  employees,  and agents) from all  liability,  loss, and costs in
     connection with any act resulting from telephone or telefax instructions it
     reasonably  believes are made by any individual  authorized by the Borrower
     to give such instructions;  except to the extent that such liability,  loss
     or costs arises from the Bank's  gross  negligence  or willful  misconduct.
     This indemnity and excuse will survive this Agreement's termination.

     6.4 Direct Debit (Pre-Billing)

          (a) The  Borrower  agrees  that the Bank  will  debit  the  Borrower's
     account number  14899-02502,  or such other of the Borrower's accounts with
     the  Bank  as  designated  in  writing  by the  Borrower  (the  "Designated
     Account")  on the date  each  payment  of  interest  and any fees  from the
     Borrower  becomes  due (the "Due  Date").  If the Due Date is not a banking
     day, the Designated Account will be debited on the next banking day.

          (b)  Approximately  10 days prior to each Due Date, the Bank will mail
     to the  Borrower a statement  of the  amounts  that will be due on that Due
     Date (the "Billed Amount").  The calculation will be made on the assumption
     that no new  extensions of credit or payments will be made between the date
     of the  billing  statement  and the Due  Date,  and that  there  will be no
     changes in the applicable interest rate.

          (c) The Bank will debit the Designated  Account for the Billed Amount,
     regardless of the actual amount due on that date (the "Accrued Amount"). If
     the  Billed  Amount  debited to the  Designated  Account  differs  from the
     Accrued Amount, the discrepancy will be treated as follows:

               (i) If the Billed  Amount is less than the  Accrued  Amount,  the
          Billed  Amount for the  following  Due Date will be  increased  by the
          amount of the  discrepancy.  The  Borrower  will not be in  default by
          reason of any such discrepancy.

               (ii) If the Billed  Amount is more than the Accrued  Amount,  the
          Billed  Amount for the  following  Due Date will be  decreased  by the
          amount of the discrepancy.

Regardless of any such discrepancy,  interest will continue to accrue based
on the actual amount of principal outstanding without compounding. The Bank will
not pay the Borrower interest on any overpayment.

          (d) The Borrower  will  maintain  sufficient  funds in the  Designated
     Account  to cover  each  debit.  If  there  are  insufficient  funds in the
     Designated Account on the date the Bank enters any debit authorized by this
     Agreement, the debit will be reversed.

     6.5 Banking Days.  Unless otherwise  provided in this Agreement,  a banking
day is a day  other  than a  Saturday  or a Sunday on which the Bank is open for
business in California.  All payments and disbursements  which would be due on a
day which is not a banking day will be due on the next banking day. All payments
received  on a day which is not a banking  day will be  applied to the credit on
the next banking day.

     6.6 Taxes.

          (a) If any  payments  to the Bank under this  Agreement  are made from
     outside the United  States,  the Borrower will not deduct any foreign taxes
     from any  payments  it makes to the Bank.  If any such taxes are imposed on
     any  payments  made  by  the  Borrower   (including   payments  under  this
     paragraph),  the Borrower will pay the taxes and will also pay to the Bank,
     at the  time  interest  is  paid,  any  additional  amount  which  the Bank
     specifies as necessary to preserve the after-tax  yield the Bank would have
     received if such taxes had not been imposed. The Borrower will confirm that
     it has paid  the  taxes  by  giving  the Bank  official  tax  receipts  (or
     notarized copies) within 30 days after the due date.

          (b)  Payments  made by the  Borrower to the Bank will be made  without
     deduction of United States withholding or similar taxes. If the Borrower is
     required to pay U.S. withholding taxes, the Borrower will pay such taxes in
     addition  to the  amounts  due to the Bank  under  this  Agreement.  If the
     Borrower fails to make such tax payments when due, the Borrower indemnifies
     the Bank against any liability  for such taxes,  as well as for any related
     interest,  expenses,  additions  to tax, or penalties  asserted  against or
     suffered by the Bank with respect to such taxes.

     6.7 Interest Calculation. Except as otherwise stated in this Agreement, all
interest and fees,  if any,  will be computed on the basis of a 360-day year and
the actual number of days elapsed. This results in more interest or a higher fee
than if a 365-day year is used.

     6.8 Default Rate.  Upon the occurrence and during the  continuation  of any
default under this Agreement, principal amounts outstanding under this Agreement
will at the  option  of the Bank  bear  interest  at a rate  which is one  (1.0)
percentage point higher than the rate of interest  otherwise provided under this
Agreement.  This will not  constitute a waiver of any default.  Installments  of
principal  which are not paid when due under this  Agreement  shall  continue to
bear interest  until paid.  Any interest,  fees or costs which are not paid when
due shall bear interest at the Bank's Reference Rate plus  three-quarters of one
(0.75) percentage point. This may result in compounding of interest.

     6.9 Payments in Kind. If the Bank requires delivery in kind of the proceeds
of collection of the  Borrower's  accounts  receivable,  such proceeds  shall be
credited  to  interest,  principal,  and other  sums owed to the Bank under this
Agreement  in the  order  and  proportion  determined  by the  Bank in its  sole
discretion.  All  such  credits  will be  conditioned  upon  collection  and any
returned items may, at the Bank's option, be charged to the Borrower.

7.  CONDITIONS

     The Bank must receive the following  items, in form and content  acceptable
to the Bank,  before it is required to extend any credit to the  Borrower  under
this Agreement:

     7.1 Authorizations.  Evidence that the execution,  delivery and performance
by the Borrower  (and each  Guarantor) of this  Agreement and any  instrument or
agreement required under this Agreement have been duly authorized.

     7.2 Governing  Documents.  A copy of the  Borrower's  and each  Guarantor's
articles of incorporation.

     7.3 Security Agreements. Signed original security agreements,  assignments,
and financing  statements (together with collateral in which the Bank requires a
possessory security interest), which the Bank requires.

     7.4 Evidence of Priority.  Evidence  that  security  interests and liens in
favor of the Bank are valid,  enforceable,  and prior to all others'  rights and
interests, except those the Bank consents to in writing.

     7.5 Consent to Removal.  For any personal  property  collateral  located on
real  property  which is subject to a mortgage  or deed of trust or which is not
owned by the grantor of the  security  interest,  if the Bank so requires in its
discretion,  a Consent to Removal  from the owner of the real  property  and the
holder of any mortgage or deed of trust.

     7.6  Insurance.   Evidence  of  insurance  coverage,  as  required  in  the
"Covenants" section of this Agreement.

     7.7 Guaranties.  Guaranties  signed by each Guarantor,  covering the entire
amount of the Borrower's obligations to the Bank.

     7.8 Subordination Agreement. A subordination agreement in favor of the Bank
signed by  Monsanto  Company,  covering  the  Monsanto  Line of Credit and other
obligations of the Borrower to Monsanto Company, together with evidence that the
outstanding  principal  amount of the  Monsanto Sub Debt is not less than Twenty
Four Million Seven Hundred Sixty Thousand Dollars ($24,760,000).

     7.9 Payment of Fees. Payment of all accrued and unpaid expenses incurred by
the Bank as required by the paragraph entitled "Reimbursement Costs."

     7.10 Equity Contribution. Evidence that Monsanto Company has contributed an
additional  Fifty Million Dollars  ($50,000,000) of cash equity to the Borrower,
as approved by the shareholders in November, 1996.

     7.11 Other Items. Any other items that the Bank reasonably requires.

8.  REPRESENTATIONS AND WARRANTIES

     When the  Borrower  signs this  Agreement,  and until the Bank is repaid in
full,  the Borrower makes the following  representations  and  warranties.  Each
request for an extension of credit constitutes a renewed representation:

     8.1 Organization of Borrower. The Borrower is a corporation duly formed and
existing under the laws of the state where organized.

     8.2 Authorization. This Agreement, and any instrument or agreement required
hereunder,  are within the Borrower's powers, have been duly authorized,  and do
not conflict with any of its organizational papers.

     8.3  Enforceable  Agreement.  This Agreement is a legal,  valid and binding
agreement of the Borrower,  enforceable  against the Borrower in accordance with
its terms, and any instrument or agreement required hereunder, when executed and
delivered, will be similarly legal, valid, binding and enforceable.

     8.4 Good Standing. In each state in which the Borrower does business, it is
properly  licensed,  in good standing,  and, where required,  in compliance with
fictitious name statutes.

     8.5 No Conflicts. This Agreement does not conflict with any law, agreement,
or obligation by which the Borrower is bound.

     8.6 Financial  Information.  All financial and other  information  that has
been or will be  supplied to the Bank,  including  the  Borrower's  consolidated
financial statement dated as of December 31, 1996, is:

          (a) sufficiently  complete to give the Bank accurate  knowledge of the
     Borrower's and Guarantors' financial condition.

          (b) in compliance with all government regulations that apply.

Since the date of the financial  statement  specified  above,  there has been no
material  adverse  change in the business  condition  (financial or  otherwise),
operations, properties or prospects of the Borrower or any Guarantor.

     8.7 Lawsuits.  There is no lawsuit,  tax claim or other dispute  pending or
threatened  against the Borrower  which,  if lost,  would impair the  Borrower's
financial  condition or ability to repay the loan, except as have been disclosed
in writing to the Bank.

     8.8 Collateral.  All collateral  required in this Agreement is owned by the
grantor of the security  interest free of any title defects and, with respect to
accounts receivable and inventory, free of any liens or interests of others.

     8.9 Permits,  Franchises. The Borrower possesses all permits,  memberships,
franchises, contracts and licenses required and all trademark rights, trade name
rights,  patent  rights and  fictitious  name rights  necessary  to enable it to
conduct the business in which it is now engaged.

     8.10 Other  Obligations.  The Borrower is not in default on any  obligation
for borrowed money,  any purchase money  obligation or any other material lease,
commitment, contract, instrument or obligation, except as have been disclosed in
writing to the Bank.

     8.11 Income Tax  Matters.  The  Borrower  has no  knowledge  of any pending
assessments or  adjustments of its income tax for any year,  except as have been
disclosed in writing to the Bank.

     8.12 No Tax Avoidance  Plan.  The  Borrower's  obtaining of credit from the
Bank under this Agreement does not have as a principal  purpose the avoidance of
U.S. withholding taxes.

     8.13 No Event of  Default.  There is no event  which is, or with  notice or
lapse of time or both would be, a default under this Agreement.

     8.14  Merchantable  Inventory.  All  inventory  which  is  included  in the
Borrowing Base is of good and merchantable quality and free from defects.

     8.15 ERISA Plans.

          (a) Each Plan (other than a  multiemployer  plan) is in  compliance in
     all material respects with the applicable provisions of ERISA, the Code and
     other   federal  or  state  law.   Each  Plan  has   received  a  favorable
     determination  letter  from  the  IRS  and to  the  best  knowledge  of the
     Borrower,  nothing  has  occurred  which  would  cause  the  loss  of  such
     qualification.  The Borrower has fulfilled its  obligations,  if any, under
     the minimum  funding  standards  of ERISA and the Code with respect to each
     Plan,  and has not  incurred any  liability  with respect to any Plan under
     Title IV of ERISA.

          (b)  There  are no  claims,  lawsuits  or  actions  (including  by any
     governmental  authority),  and there has been no prohibited  transaction or
     violation of the fiduciary  responsibility  rules, with respect to any Plan
     which has resulted or could  reasonably be expected to result in a material
     adverse effect.

          (c) With respect to any Plan subject to Title IV of ERISA:

               (i) No reportable  event has occurred  under  Section  4043(c) of
          ERISA for which the PBGC requires 30 day notice.

               (ii)  No  action  by the  Borrower  or  any  ERISA  Affiliate  to
          terminate  or  withdraw  from any Plan has been taken and no notice of
          intent to terminate a Plan has been filed under Section 4041 of ERISA.

               (iii) No  termination  proceeding has been commenced with respect
          to a Plan under  Section  4042 of ERISA,  and no event has occurred or
          condition exists which might  constitute  grounds for the commencement
          of such a proceeding.

          (d) The  following  terms have the meanings  indicated for purposes of
     this Agreement:

               (i) "Code"  means the Internal  Revenue Code of 1986,  as amended
          from time to time.

               (ii) "ERISA" means the Employee Retirement Income Security Act of
          1974, as amended from time to time.

               (iii) "ERISA  Affiliate" means any trade or business  (whether or
          not  incorporated)  under common control with the Borrower  within the
          meaning of Section 414(b) or (c) of the Code.

               (iv) "PBGC" means the Pension Benefit Guaranty Corporation.

               (v) "Plan" means a pension,  profit-sharing,  or stock bonus plan
          intended to qualify  under Section  401(a) of the Code,  maintained or
          contributed to by the Borrower or any ERISA  Affiliate,  including any
          multiemployer plan within the meaning of Section 4001(a)(3) of ERISA.

     8.16  Location of Borrower.  The  Borrower's  place of business (or, if the
Borrower has more than one place of  business,  its chief  executive  office) is
located at the address listed under the Borrower's signature on this Agreement.

     8.17  Environmental  Matters.  Except as has been  disclosed to the Bank in
writing,  the  Borrower  (a) is not in  violation  of  any  health,  safety,  or
environmental law or regulation  regarding  hazardous  substances and (b) is not
the subject of any claim,  proceeding,  notice, or other communication regarding
hazardous substances.  "Hazardous  substances" means any substance,  material or
waste  that is or becomes  designated  or  regulated  as  "toxic,"  "hazardous,"
"pollutant," or "contaminant"  or a similar  designation or regulation under any
federal,  state or local law (whether under common law,  statute,  regulation or
otherwise)  or  judicial or  administrative  interpretation  of such,  including
without limitation petroleum or natural gas.

9.  COVENANTS

     The Borrower  agrees,  so long as credit is available  under this Agreement
and until the Bank is repaid in full:

     9.1 Use of  Proceeds.  To use the  proceeds  of the credit only for general
working capital purposes.

     9.2 Financial  Information.  To provide the following financial information
and statements in form and content  acceptable to the Bank, and such  additional
information as reasonably requested by the Bank from time to time:

          (a) Copies of the  Borrower's  Form 10-K Annual  Report within 90 days
     after the date of filing with the Securities and Exchange Commission.

          (b) Copies of the Borrower's  Form 10-Q Quarterly  Report and Form 8-K
     Current  Report within 45 days after the date of filing with the Securities
     and Exchange Commission.

          (c)  Within 45 days of the  period's  end,  the  Borrower's  quarterly
     financial statements.  These financial statements may be Borrower prepared.
     The statements shall be prepared on a consolidated and consolidating basis.

          (d) Within 30 days of each month end, a borrowing  certificate setting
     forth the amount of Acceptable  Receivables and Acceptable  Inventory as of
     the last day of such month.

          (e) Within 30 days of each month end, a compliance  certificate of the
     Borrower signed by an authorized  financial officer of the Borrower setting
     forth (i) the  information  and  computations  (in  sufficient  detail)  to
     establish that the Borrower is in compliance  with all financial  covenants
     at the end of the period  covered by the  financial  statements  then being
     furnished and (ii) whether  there existed as of the date of such  financial
     statements and whether there exists as of the date of the certificate,  any
     default under this  Agreement and, if any such default  exists,  specifying
     the nature  thereof and the action the  Borrower is taking and  proposes to
     take with respect thereto.

          (f) By December 31 of each year, projected income statements,  balance
     sheets and cash flow  statements  for (i) the  Borrower  on a  consolidated
     basis; (ii) Gargiulo, Inc.; and (iii) all subsidiaries other than Gargiulo,
     Inc. The projections  shall include an annual  projection by month covering
     the subsequent year, as well as a five year projection.

          (g) promptly upon  receipt,  copies of all notices,  orders,  or other
     communications  regarding  (i)  any  material  enforcement  action  by  any
     governmental authority relating to health, safety, the environment,  or any
     hazardous substances with regard to the Borrower's property, activities, or
     operations,  or (ii) any  material  claim  against the  Borrower  regarding
     hazardous substances.

          (h) Statements  showing an aging of the Borrower's  receivables within
     thirty (30) days after the end of each month.

          (i) A statement  showing an aging of accounts  payable  within  thirty
     (30) days after the end of each month.

          (j) If the Borrower purchases  agricultural  products from growers for
     use in the Borrower's  business,  a listing of accounts  payable to growers
     within 30 days after the end of each month.

          (k) An inventory  listing,  covering cotton seed (including bulk seed)
     and plant oil and plant oil-based products (including,  but not limited to,
     canola,  palm,  and soybean  oils) within thirty (30) days after the end of
     each month;  the listing must include a description of the  inventory,  its
     location and cost, and such other information as the Bank may require.

          (l)  Promptly  upon  the  Bank's   reasonable   request,   such  other
     statements,  lists of property and accounts,  budgets, forecasts or reports
     as to the Borrower and as to each Guarantor of the  Borrower's  obligations
     to the Bank as the Bank may request.

     9.3 Limitation on Losses.  Not to incur on a consolidated  basis a net loss
after taxes and extraordinary items in excess of the following:

          (a) In any one fiscal year, the sum of:

               (i) Ten Million Dollars ($10,000,000); plus

               (ii) the increase, since the beginning of the fiscal year, in the
          principal amount outstanding under the Monsanto Sub Debt; plus

               (iii) cash  received  during the fiscal year from the sale of the
          Borrower's stock; plus

               (iv) the increase, since the beginning of the fiscal year, in the
          amount of accrued but unpaid interest on the Subordinated Debt.

          (b) From the date of this Agreement through any calculation date up to
     and including December 1, 1999, the sum of:

               (i) Fifteen Million Dollars ($15,000,000); plus

               (ii) the  increase,  since  December 31, 1996,  in the  principal
          amount outstanding under the Monsanto Sub Debt; plus

               (iii) cash received,  since  December 31, 1996,  from the sale of
          the Borrower's stock; plus

               (iv) the  increase,  since  December 31,  1996,  in the amount of
          accrued but unpaid interest on Subordinated Debt.

     9.4  Adjusted  Tangible  Net Worth.  To  maintain on a  consolidated  basis
Adjusted   Tangible  Net  Worth  equal  to  at  least  Fifty   Million   Dollars
($50,000,000).

"Adjusted Tangible Net Worth" means Tangible Net Worth, plus Subordinated  Debt,
plus Monsanto R&D Advances.

"Monsanto  R&D  Advances"  means the  amount of cash  research  and  development
advances made by Monsanto  Company to the Borrower and accounted for as deferred
revenue.

"Tangible  Net  Worth"  means  the gross  book  value of the  Borrower's  assets
(excluding goodwill,  patents,  trademarks,  trade names,  organization expense,
treasury stock,  unamortized debt discount and expense,  capitalized or deferred
research  and  development   costs,   deferred  marketing   expenses,   deferred
receivables,  and  other  like  intangibles,  and  monies  due from  affiliates,
officers,   directors,   employees,   or  shareholders  of  the  Borrower)  plus
Subordinated Debt, less total liabilities,  including but not limited to accrued
and deferred income taxes, and any reserves against assets.

     9.5  Leverage.  To  maintain on a  consolidated  basis a ratio of (a) Total
Liabilities,  minus  Subordinated  Debt,  minus  Monsanto R&D  Advances,  to (b)
Adjusted Tangible Net Worth, not exceeding 1.50:1.0.

"Total liabilities" means the sum of current liabilities plus long term
liabilities.

     9.6 Adjusted Cash Flow. To maintain on a consolidated basis for each fiscal
year  Adjusted  Cash  Flow  not  less  than  negative   Three  Million   Dollars
($-3,000,000).

"Adjusted  Cash  Flow"  means  the  sum  of  net  income  from   operations  and
investments,  after taxes, plus the increase in the principal amount outstanding
under the Monsanto Sub Debt,  plus  depreciation,  depletion,  amortization  and
other non-cash charges,  plus accrued but unpaid interest on Subordinated  Debt,
minus Unfinanced Acquisitions of Fixed or Capital Assets.

"Unfinanced Acquisitions of Fixed or Capital Assets" means acquisitions of fixed
or capital assets with cash or with the proceeds of revolving lines of credit.

     9.7 Other Debts.  Not to have outstanding or incur (or permit any Guarantor
to have  outstanding  or incur) any direct or  contingent  liabilities  or lease
obligations (other than those to the Bank), or become liable for the liabilities
of others without the Bank's written consent. This does not prohibit:

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

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

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

          (d)  Liabilities  and lines of credit and leases in  existence  on the
     date of this  Agreement  disclosed in writing to the Bank in the Borrower's
     financial statement dated December 31, 1996.

          (e)  Additional  debts and lease  obligations  for the  acquisition of
     fixed or capital assets (to the extent permitted in paragraph 9.9 below) in
     an amount not exceeding Six Million Dollars ($6,000,000) outstanding at any
     one time.

          (f) Subordinated Debt acceptable to the Bank in its sole discretion.

          (g) Debts and lease  obligations,  acceptable  to the Bank in its sole
     discretion,   which  are  assumed  by  the  Borrower  or  Guarantor  in  an
     acquisition permitted under paragraph 9.21(d) below.

          (h) Operating leases.

     9.8 Other Liens. Not to create,  assume,  or allow any security interest or
lien (including judicial liens) on property the Borrower or any Guarantor now or
later owns, except:

          (a) Deeds of trust and security agreements in favor of the Bank.

          (b) Liens for taxes not yet due.

          (c) Liens outstanding on the date of this Agreement.

          (d) Additional  purchase  money security  interests in fixed assets or
     equipment acquired after the date of this Agreement, if the total principal
     amount of debts  secured by such liens does not exceed Six Million  Dollars
     ($6,000,000) at any one time.

          (e)  Additional  liens on fixed  assets or  equipment  with a net book
     value of no more than Six Million  Dollars  ($6,000,000) to secure purchase
     money financing permitted by the foregoing paragraphs.

          (f) Liens  arising by operation  of law and in the ordinary  course of
     the Borrower's or  Guarantor's  business  securing  amounts the Borrower or
     Guarantor  owes  to  growers  of  agricultural  products  purchased  by the
     Borrower or  Guarantor  for resale,  processing,  or use in  producing  the
     Borrower's or Guarantor's inventory, provided such obligations are not past
     due.

     9.9 Monsanto  Line of Credit.  To continue to maintain the Monsanto Line of
Credit in an amount not less than Fifteen  Million Dollars  ($15,000,000),  with
terms and  conditions  substantially  identical to those in the existing  credit
agreement dated March 31, 1996.

     9.10  Dividends.  Not to declare or pay any  dividends on any of its shares
except dividends payable in capital stock of the Borrower,  and not to purchase,
redeem or otherwise  acquire for value any of its shares,  or create any sinking
fund in relation thereto.

     9.11 Notices to Bank. To promptly notify the Bank in writing of:

          (a) any lawsuit  claiming  damages of over Two Hundred Fifty  Thousand
     Dollars ($250,000) against the Borrower or any Guarantor.

          (b) any  substantial  dispute  between the Borrower (or any Guarantor)
     and any government authority.

          (c) any failure to comply with this Agreement.

          (d) any material adverse change in the Borrower's (or any Guarantor's)
     business  condition  (financial or  otherwise),  operations,  properties or
     prospects, or ability to repay the credit.

          (e) any  change  in the  Borrower's  or any  Guarantor's  name,  legal
     structure, or chief executive office.

          (f) the  receipt  of any  notice or  communication  regarding  (i) any
     threatened  or  pending   investigation   or  enforcement   action  by  any
     governmental  authority or any other claim relating to health,  safety, the
     environment,  or any hazardous  substances with regard to the Borrower's or
     any Guarantor's property,  activities,  or operations or (ii) any knowledge
     on the part of the Borrower that hazardous substances exist on or under the
     Borrower's or any Guarantor's real property.

     9.12 Books and Records. To maintain,  and cause each Guarantor to maintain,
adequate books and records.

     9.13 Audits.

          (a) To allow  the Bank and its  agents,  upon  ten  days'  notice,  to
     inspect the Borrower's and each Guarantor's  properties  (including  taking
     and  removing  samples  related to any  investigation  regarding  hazardous
     substances) and examine,  audit and make copies of books and records at any
     reasonable time. If any of the Borrower's or Guarantor's properties,  books
     or records are in the possession of a third party, the Borrower  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.

          (b) The Bank has no duty to  inspect  the  Borrower's  or  Guarantor's
     properties  or to  examine,  audit or copy books and  records  and the Bank
     shall not incur any  obligation  or  liability  by reason of not making any
     such  inspection  or  inquiry.  In the  event  that the Bank  inspects  the
     Borrower's or  Guarantor's  properties or examines,  audits or copies books
     and records,  the Bank will be acting solely for the purposes of protecting
     the Bank's  security and preserving the Bank's rights under this Agreement.
     Neither  the  Borrower  nor any  other  party  is  entitled  to rely on any
     inspection or other  inquiry by the Bank.  The Bank owes no duty of care to
     protect the  Borrower,  the  Guarantor  or any other party  against,  or to
     inform the  Borrower,  the  Guarantor  or any other  party of, any  adverse
     condition  that may be observed as affecting the  Borrower's or Guarantor's
     properties or premises, or the Borrower's or Guarantor's business.

          (c) The Bank  shall  hold all  nonpublic  information  concerning  the
     Borrower  obtained from the Borrower  through such audits and  inspections,
     including  information  obtained  through the Bank's  agents,  confidential
     pursuant  to the  Bank's  normal  practices  and  procedures  for  handling
     confidential  information of such nature,  provided that the Bank shall not
     be precluded  from making  disclosure  regarding such  information:  (i) to
     counsel of the Bank,  accountants  and other  professional  advisors of the
     Bank;  (ii) in response  to a subpoena or order of a court or  governmental
     agency;  (iii)  at the  request  of any  bank  regulatory  authority  or in
     connection  with an  examination  of the  Bank by such  authority;  (iv) as
     required by law or applicable regulation;  or (v) to the extent required in
     connection with the exercise of any remedy hereunder.  Notwithstanding  the
     foregoing,  the Bank may in its  discretion  disclose to the Borrower,  the
     Guarantor or any other party any findings relating to hazardous  substances
     (as defined in  paragraph  10 below) made as a result of, or in  connection
     with, any inspection of the Borrower's or Guarantor's properties.

     9.14  Compliance  with Laws. To comply (and cause each Guarantor to comply)
with the laws (including any fictitious name statute),  regulations,  and orders
of any government  body with  authority  over the Borrower's or the  Guarantor's
business.

     9.15   Preservation  of  Rights.  To  maintain  and  preserve  all  rights,
privileges, and franchises the Borrower and each Guarantor now has.

     9.16  Maintenance  of  Properties.  To  make  any  repairs,   renewals,  or
replacements  to keep the  Borrower's  and each  Guarantor's  properties in good
working condition.

     9.17 Perfection of Liens. To help the Bank perfect and protect its security
interests and liens, and reimburse it for related  reasonable costs it incurs to
protect its security interests and liens.

     9.18 Cooperation.  To take any action  reasonably  requested by the Bank to
carry out the intent of this Agreement.

     9.19 Insurance.

          (a)  Insurance  Covering  Collateral.  To maintain  all risk  property
     damage insurance  policies  covering the tangible  property  comprising the
     collateral.  Each insurance policy must be for the full replacement cost of
     the collateral and include a replacement cost  endorsement,  and may have a
     deductible of up to $25,000.  The insurance  must be issued by an insurance
     company  acceptable  to the Bank and must  include a lender's  loss payable
     endorsement in favor of the Bank in a form acceptable to the Bank.

          (b) General Business Insurance.  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  the  Borrower's  or
     Guarantor's  properties,  public liability insurance including coverage for
     contractual liability, product liability and workers' compensation, and any
     other insurance which is usual for the Borrower's or Guarantor's business.

          (c) Evidence of Insurance. Upon the request of the Bank, to deliver to
     the Bank a copy of each insurance  policy,  or, if permitted by the Bank, a
     certificate of insurance listing all insurance in force.

     9.20  Additional  Negative  Covenants.  Not to,  without the Bank's written
consent (and not permit any Guarantor to):

          (a) engage in any business activities substantially different from the
     Borrower's or Guarantor's present business.

          (b) liquidate or dissolve the Borrower's or Guarantor's business.

          (c) enter into any consolidation, merger, or other combination.

          (d) sell,  assign,  lease,  transfer or otherwise  dispose of all or a
     substantial  part  of  the  Borrower's  or  Guarantor's   business  or  the
     Borrower's or Guarantor's assets.

          (e) sell, assign, lease, transfer or otherwise dispose of any material
     assets,  or enter into any agreement to do so, except as follows:  (i) with
     respect to accounts  receivable,  for a consideration at least equal to the
     balance  outstanding  thereunder;  (ii) with  respect to  inventory,  for a
     consideration at least equal to the Borrower's or Guarantor's cost thereof;
     (iii) with respect to fixed assets or equipment,  sales or  dispositions in
     the ordinary course of business,  including  dispositions of used, worn-out
     or surplus  equipment;  and (iv) the sale of  equipment  to the extent that
     such  equipment  is  exchanged  for credit  against the  purchase  price of
     similar replacement equipment,  or the proceeds of such sale are reasonably
     promptly applied to the purchase price of such replacement equipment.

          (f) enter into any sale and  leaseback  agreement  covering any of its
     fixed or capital assets,  except to the extent  permitted by paragraphs 9.7
     and 9.8 above.

          (g) voluntarily suspend its business for more than one day (except for
     weekends and state or federal holidays).

     9.21 ERISA Plans.  With respect to a Plan subject to Title IV of ERISA,  to
give prompt written notice to the Bank of:

          (a) The  occurrence of any reportable  event under Section  4043(c) of
     ERISA for which the PBGC requires 30 day notice.

          (b) Any action by the Borrower or any ERISA  Affiliate to terminate or
     withdraw  from a Plan or the  filing of any  notice of intent to  terminate
     under Section 4041 of ERISA.

          (c) The  commencement  of any proceeding  with respect to a Plan under
     Section 4042 of ERISA.

     9.22  Compliance  with  Environmental  Requirements.  With  regard  to  the
Borrower's and each Guarantor's property,  activities,  or operations, to comply
with the  recommendations of any qualified  environmental  engineer or orders or
directions issued by any governmental  authority relating to health, safety, the
environment,  or any hazardous  substances  including those orders or directives
requiring the investigation, clean-up, or removal of hazardous substances.

     9.23 Loans and  Investments.  Not to (and not permit any Guarantor to) make
any loans or other  extensions of credit to, or make any investments in, or make
any capital  contributions  or other  transfers of assets to, any  individual or
entity,  or acquire or purchase a business or its assets, or become a partner in
any  partnership or member of any joint venture  (collectively,  "Investments"),
except for:

          (a) extensions of credit in the nature of accounts receivable or notes
     receivable  arising  from the sale or  lease  of goods or  services  in the
     ordinary course of business.

          (b) investments in any of the following:

               (i) certificates of deposit;

               (ii) U.S.  treasury  bills and other  obligations  of the federal
          government;

               (iii)  other   investments  in  accordance  with  the  Borrower's
          investment policy previously provided to the Bank;

          (c) intercompany loans among the Borrower and the Guarantors;

          (d) Investments not covered by (a) through (c) above, for an aggregate
     consideration  (including  assumption  of  liabilities)  not  exceeding the
     following:

               (i) Five Million Dollars ($5,000,000) in 1997; and

               (ii)  Ten  Million  Dollars  ($10,000,000)  from the date of this
          Agreement through December 1, 1999.

10.  HAZARDOUS WASTE INDEMNIFICATION

     The Borrower  will  indemnify  and hold  harmless the Bank from any loss or
liability   directly  or  indirectly   arising  out  of  the  use,   generation,
manufacture,   production,  storage,  release,  threatened  release,  discharge,
disposal or presence of a hazardous substance. This indemnity will apply whether
the  hazardous  substance  is on,  under or about  the  Borrower's  property  or
operations or property leased to the Borrower. The indemnity includes but is not
limited to reasonable  attorneys' fees (including the reasonable estimate of the
allocated  cost of in-house  counsel and staff).  The  indemnity  extends to the
Bank, its parent, subsidiaries and all of their directors,  officers, employees,
agents,  successors,  attorneys and assigns.  "Hazardous  substances"  means any
substance,  material  or waste that is or becomes  designated  or  regulated  as
"toxic," "hazardous,"  "pollutant," or "contaminant" or a similar designation or
regulation  under any  federal,  state or local law  (whether  under common law,
statute,  regulation or otherwise) or judicial or administrative  interpretation
of such,  including without limitation  petroleum or natural gas. This indemnity
will survive repayment of the Borrower's obligations to the Bank.

11.  DEFAULT

     If any of the following  events occurs,  the Bank may do one or more of the
following:  declare the Borrower in default,  stop making any additional  credit
available  to the  Borrower,  and require the  Borrower to repay its entire debt
immediately  and without prior notice.  If an event of default  occurs under the
paragraph entitled "Bankruptcy," below, with respect to the Borrower,  then, the
entire  debt  outstanding  under  this  Agreement  will   automatically  be  due
immediately.

     11.1  Failure  to Pay.  The  Borrower  fails to make a payment  under  this
Agreement within 5 days after the date when due.

     11.2  Lien  Priority.  The Bank  fails to have an  enforceable  first  lien
(except for liens on equipment  and except for any prior liens to which the Bank
has  consented  in  writing) on or security  interest in any  property  given as
security  for this loan.  If, in the Bank's  reasonable  opinion,  the breach is
capable of being remedied, the breach will not be considered an event of default
under this  Agreement  for a period of five (5) days after the date on which the
Bank gives written notice of the breach to the Borrower; provided, however, that
the Bank will not be obligated to extend any  additional  credit to the Borrower
during that period.

     11.3 False Information.  The Borrower (or any Guarantor) has given the Bank
materially false or misleading information or representations.

     11.4  Bankruptcy.  The  Borrower  (or any  Guarantor)  files  a  bankruptcy
petition, a bankruptcy petition is filed against the Borrower (or any Guarantor)
or the Borrower (or any Guarantor) makes a general assignment for the benefit of
creditors.

     11.5  Receivers.  A  receiver  or similar  official  is  appointed  for the
Borrower's (or any Guarantor's) business, or the business is terminated.

     11.6  Lawsuits.  Any lawsuit or lawsuits are filed on behalf of one or more
trade  creditors  against the  Borrower in an  aggregate  amount of Four Million
Dollars  ($4,000,000)  or more in  excess  of any  insurance  coverage,  and the
lawsuit(s) are not dismissed within thirty (30) days of the date of filing.

     11.7 Judgments. Any judgments or arbitration awards are entered against the
Borrower (or any Guarantor),  or the Borrower (or any Guarantor) enters into any
settlement  agreements  with respect to any  litigation  or  arbitration,  in an
aggregate  amount of Four Million Dollars  ($4,000,000) or more in excess of any
insurance coverage.

     11.8 Government Action. Any government authority takes action that the Bank
believes  materially  adversely  affects  the  Borrower's  (or any  Guarantor's)
financial condition or ability to repay.

     11.9  Material  Adverse  Change.  A material  adverse  change occurs in the
Borrower's (or any  Guarantor's)  business  condition  (financial or otherwise),
operations, properties or prospects, or ability to repay the credit.

     11.10  Cross-default.  Any default occurs under any agreement in connection
with any credit the Borrower,  any Guarantor,  or any of the Borrower's  related
entities or affiliates  (except Monsanto  Company) has obtained from anyone else
or which the Borrower, any Guarantor,  or any of the Borrower's related entities
or affiliates has guaranteed in the amount of Two Hundred Fifty Thousand Dollars
($250,000) or more in the aggregate,  if (a) any  applicable  cure period in the
relevant  credit  agreement has expired,  and (b) the default either consists of
failing  to make a  payment  when due or gives  the  other  lender  the right to
accelerate the obligation.

     11.11  Default  under  Related  Documents.   Any  guaranty,   subordination
agreement,  security agreement,  or other document in favor of the Bank required
by this  Agreement  is  defaulted  or no longer  in  effect.  If, in the  Bank's
reasonable opinion, the breach is capable of being remedied, the breach will not
be considered  an event of default  under this  Agreement for a period of thirty
(30) days after the date on which the Bank gives written notice of the breach to
the Borrower;  provided,  however, that the Bank will not be obligated to extend
any additional credit to the Borrower during that period.

     11.12 Other Bank  Agreements.  The Borrower,  any Guarantor,  or any of the
Borrower's related entities or affiliates  (except Monsanto Company)  materially
fails to meet the  conditions  of, or fails to perform any  material  obligation
under any other agreement such company has with the Bank or any affiliate of the
Bank.  If, in the  Bank's  reasonable  opinion,  the  breach is capable of being
remedied,  the breach  will not be  considered  an event of  default  under this
Agreement  for a period  of thirty  (30)  days  after the date on which the Bank
gives written notice of the breach to the Borrower;  provided, however, that the
Bank will not be  obligated  to extend  any  additional  credit to the  Borrower
during that period.

     11.13  ERISA  Plans.  The  occurrence  of any one or more of the  following
events with respect to a Plan subject to Title IV of ERISA,  provided such event
or events could reasonably be expected,  in the judgment of the Bank, to subject
the  Borrower  to any tax,  penalty  or  liability  (or any  combination  of the
foregoing) which, in the aggregate,  could have a material adverse effect on the
financial condition of the Borrower:

          (a) A reportable event shall occur under Section 4043(c) of ERISA with
     respect to a Plan.

          (b) Any Plan  termination (or commencement of proceedings to terminate
     a Plan) or the full or partial  withdrawal  from a Plan by the  Borrower or
     any ERISA Affiliate.

     11.14 Change of Ownership. Monsanto Company ceases to own a majority of the
capital stock of the Borrower.

     11.15 Monsanto  Agreements.  Any term or condition of the Monsanto Sub Debt
or any credit agreement or technology  licensing  agreement between the Borrower
and Monsanto  Company is modified,  amended or waived,  or any such agreement is
terminated, if such action would have a material adverse effect on the financial
condition or prospects  of the Borrower or the  Borrower's  ability to repay the
credit.

     11.16  Financial  Covenants.  The Borrower  breaches the terms of paragraph
9.3, 9.4, 9.5 or 9.6; whether such failure is evidenced by financial  statements
delivered  to the Bank or is  otherwise  known to the  Borrower or the Bank.  If
there is credit  available to the  Borrower  under the Monsanto Sub Debt line of
credit in an amount  sufficient to cure such breach,  there shall be no event of
default if the Borrower cures the breach by obtaining an advance under such line
of credit  within five (5)  business  days after the date on which the breach of
the covenant is first known;  provided,  however, that such advance must be used
by the Borrower to reduce any amounts outstanding under this Agreement.

     11.17 Other Breach Under Agreement.  The Borrower  materially fails to meet
the conditions of, or fails to perform any material  obligation  under, any term
of this  Agreement  not  specifically  referred to in this  Article.  If, in the
Bank's reasonable opinion,  the breach is capable of being remedied,  the breach
will not be considered an event of default under this  Agreement for a period of
thirty  (30) days after the date on which the Bank gives  written  notice of the
breach to the Borrower;  provided,  however, that the Bank will not be obligated
to extend any additional credit to the Borrower during that period.

12. ENFORCING THIS AGREEMENT; MISCELLANEOUS

     12.1 GAAP.  Except as otherwise  stated in this  Agreement,  all  financial
information  provided to the Bank and all financial covenants will be made under
generally accepted accounting principles, consistently applied.

     12.2 California Law. This Agreement is governed by California law.

     12.3  Successors  and Assigns.  This Agreement is binding on the Borrower's
and the Bank's  successors  and assignees.  The Borrower  agrees that it may not
assign  this  Agreement  without  the Bank's  prior  consent.  The Bank may sell
participations  in or assign this loan, and may exchange  financial  information
about the Borrower  with actual or potential  participants  or  assignees.  If a
participation is sold or the loan is assigned, the purchaser will have the right
of set-off against the Borrower.

     12.4 Arbitration.

          (a) This  paragraph  concerns the resolution of any  controversies  or
     claims  between the  Borrower  and the Bank,  including  but not limited to
     those that arise from:

               (i)  This  Agreement  (including  any  renewals,   extensions  or
          modifications of this Agreement);

               (ii) Any document, agreement or procedure related to or delivered
          in connection with this Agreement;

               (iii) Any violation of this Agreement; or

               (iv) Any claims for damages resulting from any business conducted
          between  the  Borrower  and the Bank,  including  claims for injury to
          persons, property or business interests (torts).

          (b) At the request of the Borrower or the Bank, any such controversies
     or claims  will be settled by  arbitration  in  accordance  with the United
     States  Arbitration Act. The United States  Arbitration Act will apply even
     though this Agreement provides that it is governed by California law.

          (c)  Arbitration  proceedings  will be  administered  by the  American
     Arbitration  Association  and will be  subject to its  commercial  rules of
     arbitration.

          (d) For purposes of the application of the statute of limitations, the
     filing of an  arbitration  pursuant to this  paragraph is the equivalent of
     the  filing  of a  lawsuit,  and any  claim  or  controversy  which  may be
     arbitrated  under this  paragraph is subject to any  applicable  statute of
     limitations.  The arbitrators will have the authority to decide whether any
     such claim or controversy  is barred by the statute of limitations  and, if
     so, to dismiss the arbitration on that basis.

          (e) If there is a dispute as to whether  an issue is  arbitrable,  the
     arbitrators will have the authority to resolve any such dispute.

          (f) The decision that results from an  arbitration  proceeding  may be
     submitted to any authorized court of law to be confirmed and enforced.

          (g) The procedure described above will not apply if the controversy or
     claim, at the time of the proposed  submission to arbitration,  arises from
     or relates to an obligation to the Bank secured by real property located in
     California.  In this case,  both the  Borrower and the Bank must consent to
     submission of the claim or controversy to  arbitration.  If both parties do
     not consent to  arbitration,  the  controversy  or claim will be settled as
     follows:

               (i) The  Borrower  and the Bank will  designate  a referee  (or a
          panel  of  referees)  selected  under  the  auspices  of the  American
          Arbitration Association in the same manner as arbitrators are selected
          in Association-sponsored proceedings;

               (ii) The  designated  referee (or the panel of referees)  will be
          appointed by a court as provided in California Code of Civil Procedure
          Section 638 and the following related sections;

               (iii) The referee (or the presiding referee of the panel) will be
          an active attorney or a retired judge; and

               (iv) The award that  results from the decision of the referee (or
          the panel) will be entered as a judgment  in the court that  appointed
          the referee,  in accordance  with the provisions of California Code of
          Civil Procedure Sections 644 and 645.

          (h) This  provision  does not limit the right of the  Borrower  or the
     Bank to:

               (i) exercise self-help remedies such as setoff;

               (ii)  foreclose  against  or sell any real or  personal  property
          collateral; or

               (iii)  act in a  court  of  law,  before,  during  or  after  the
          arbitration proceeding to obtain:

                    (A) an interim remedy; and/or

                    (B) additional or supplementary remedies.

               (i) The pursuit of or a successful action for interim, additional
          or supplementary  remedies,  or the filing of a court action, does not
          constitute  a  waiver  of the  right  of  the  Borrower  or the  Bank,
          including  the suing  party,  to submit  the  controversy  or claim to
          arbitration if the other party contests the lawsuit.  However,  if the
          controversy  or claim arises from or relates to an  obligation  to the
          Bank which is secured by real  property  located in  California at the
          time of the proposed submission to arbitration,  this right is limited
          according to the  provision  above  requiring  the consent of both the
          Borrower and the Bank to seek resolution through arbitration.

               (j) If the Bank  forecloses  against any real  property  securing
          this Agreement,  the Bank has the option to exercise the power of sale
          under  the  deed of trust  or  mortgage,  or to  proceed  by  judicial
          foreclosure.

     12.5  Severability;   Waivers.  If  any  part  of  this  Agreement  is  not
enforceable,  the rest of the  Agreement  may be enforced.  The Bank retains all
rights,  even if it makes a loan after default. If the Bank waives a default, it
may enforce a later default.  Any consent or waiver under this Agreement must be
in writing.

     12.6  Administration  Costs.  The  Borrower  shall  pay  the  Bank  for all
reasonable  costs  incurred by the Bank in connection  with  administering  this
Agreement.

     12.7  Attorneys'  Fees.  The  Borrower  shall  reimburse  the  Bank for any
reasonable costs and attorneys' fees incurred by the Bank in connection with the
enforcement or  preservation  of any rights or remedies under this Agreement and
any other documents  executed in connection  with this Agreement,  and including
any amendment,  waiver,  "workout" or restructuring under this Agreement. In the
event of a lawsuit or arbitration  proceeding,  the prevailing party is entitled
to recover costs and reasonable  attorneys' fees incurred in connection with the
lawsuit or arbitration proceeding,  as determined by the court or arbitrator. In
the event  that any case is  commenced  by or  against  the  Borrower  under the
Bankruptcy  Code (Title 11,  United  States  Code) or any  similar or  successor
statute,  the Bank is entitled to recover costs and reasonable  attorneys'  fees
incurred by the Bank related to the preservation,  protection, or enforcement of
any rights of the Bank in such a case.  As used in this  paragraph,  "attorneys'
fees" includes the allocated costs of the Bank's in-house counsel.

     12.8 One  Agreement.  This  Agreement  and any  related  security  or other
agreements required by this Agreement, collectively:

     (a) represent the sum of the understandings and agreements between the Bank
and the Borrower concerning this credit;

     (b) replace any prior oral or written  agreements  between the Bank and the
Borrower concerning this credit; and

     (c) are  intended by the Bank and the  Borrower as the final,  complete and
exclusive statement of the terms agreed to by them.

In the event of any conflict  between this  Agreement  and any other  agreements
required by this Agreement, this Agreement will prevail.

     12.9 Disposition of Schedules,  Reports,  Etc.  Delivered by Borrower.  The
Bank  will not be  obligated  to return  any  schedules,  invoices,  statements,
budgets, forecasts,  reports or other papers delivered by the Borrower. The Bank
will destroy or otherwise dispose of such materials at such time as the Bank, in
its discretion, deems appropriate.

     12.10 Returned Merchandise.  Until the Bank exercises its rights to collect
the accounts  receivable as provided under any security agreement required under
this  Agreement,  the Borrower  may  continue its present  policies for returned
merchandise  and  adjustments.  Credit  adjustments  with  respect  to  returned
merchandise  shall be made  immediately  upon receipt of the  merchandise by the
Borrower  or upon such other  disposition  of the  merchandise  by the debtor in
accordance with the Borrower's instructions. If a credit adjustment is made with
respect to any Acceptable  Receivable,  the amount of such  adjustment  shall no
longer be included in the amount of such Acceptable  Receivable in computing the
Borrowing Base.

     12.11 Verification of Receivables.  The Bank may at any time, either orally
or in writing,  request  confirmation  from any debtor of the current amount and
status of the accounts receivable upon which such debtor is obligated.

     12.12  Waiver  of  Confidentiality.  The  Borrower  authorizes  the Bank to
discuss the  Borrower's  financial  affairs  and  business  operations  with any
accountants,  auditors,  business  consultants,  or other professional  advisors
employed by the  Borrower,  and to request from such parties such  financial and
business  information or reports (including  management  letters) concerning the
Borrower as the Bank deems appropriate.

     12.13  Indemnification.  The  Borrower  will  indemnify  and  hold the Bank
harmless from any loss,  liability,  damages,  judgments,  and costs of any kind
relating to or arising  directly or indirectly  out of (a) this Agreement or any
document required hereunder, (b) any credit extended or committed by the Bank to
the Borrower hereunder,  (c) any claim, whether well-founded or otherwise,  that
there has been a failure to comply with any law regulating the Borrower's  sales
or  leases  to or  performance  of  services  for  debtors  obligated  upon  the
Borrower's accounts receivable and disclosures in connection therewith,  and (d)
any litigation or proceeding  related to or arising out of this  Agreement,  any
such document,  any such credit, or any such claim. This indemnity  includes but
is not limited to attorneys'  fees  (including  the  allocated  cost of in-house
counsel).  This indemnity extends to the Bank, its parent,  subsidiaries and all
of their directors,  officers,  employees,  agents,  successors,  attorneys, and
assigns. This indemnity will survive repayment of the Borrower's  obligations to
the  Bank.  All sums  due to the Bank  hereunder  shall  be  obligations  of the
Borrower,  due and payable  immediately without demand. This indemnity shall not
apply to any  liability,  loss or  costs  which  arise  from  the  Bank's  gross
negligence or willful misconduct.

     12.14  Notices.   All  notices  required  under  this  Agreement  shall  be
personally  delivered  or sent by first  class  mail,  postage  prepaid,  to the
addresses on the signature page of this Agreement, or to such other addresses as
the Bank and the Borrower may specify from time to time in writing.

     12.15 Headings.  Article and paragraph  headings are for reference only and
shall not  affect  the  interpretation  or  meaning  of any  provisions  of this
Agreement.

     12.16 Counterparts.  This Agreement may be executed in as many counterparts
as  necessary  or  convenient,   and  by  the  different   parties  on  separate
counterparts  each of which,  when so executed,  shall be deemed an original but
all such counterparts shall constitute but one and the same agreement.

This Agreement is executed as of the date stated at the top of the first page.


BANK OF AMERICA NATIONAL         CALGENE, INC.
TRUST AND SAVINGS ASSOCIATION

By /s/ Robert L. Munn, Jr.       By /s/ Christian Leleu

Typed Name Robert L. Munn, Jr.   Typed Name Christian Leleu

Title V.P.                       Title Chief Financial Officer

By                               By /s/ Lloyd M. Kunimoto

Typed Name                       Typed Name Lloyd M. Kunimoto

Title                            Title President

Address where notices to         Address where notices to
the Bank are to be sent:         the Borrower are to be sent:
555 Capital Mall, Suite 150      1920 Fifth Street
Sacramento, CA 95814             Davis, CA 95616