EXHIBIT 10.23.1

THESE  SECURITIES HAVE NOT BEEN REGISTERED  UNDER THE SECURITIES ACT OF 1933, AS
AMENDED,  OR ANY STATE SECURITIES LAWS. THEY MAY NOT BE SOLD OR OFFERED FOR SALE
IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER
SAID ACT AND ANY APPLICABLE  STATE  SECURITIES  LAWS OR THE  AVAILABILITY  OF AN
EXEMPTION FROM  REGISTRATION  UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES
LAWS.

                                   No. TBCC-01
                           STOCK SUBSCRIPTION WARRANT

                           To Purchase Common Stock of

                      VALUESTAR CORPORATION (the "Company")

                    DATE OF INITIAL ISSUANCE: April 11, 2000

         THIS  CERTIFIES THAT for value  received,  TBCC FUNDING TRUST II or its
registered  assigns  (hereinafter  called the  "Holder") is entitled to purchase
from the Company,  at any time during the Term of this Warrant,  an aggregate of
$140,000 in shares of common  stock,  $0.00025  par value,  of the Company  (the
"Common Stock"), at the Warrant Price,  payable as provided herein. The exercise
of this Warrant shall be subject to the provisions, limitations and restrictions
herein contained, and may be exercised in whole or in part.

SECTION 1.  Definitions.

         For all purposes of this Warrant,  the  following  terms shall have the
meanings indicated:

         Common Stock - shall mean and include the Company's  authorized  Common
Stock, $0.00025 par value, as constituted at the date hereof.

         Exchange  Act - shall  mean the  Securities  Exchange  Act of 1934,  as
amended from time to time.

         Securities Act - the Securities Act of 1933, as amended.

         Term of this  Warrant - shall mean the period  beginning on the date of
initial issuance hereof and ending on April 11, 2005.

         Warrant  Price - shall mean the average  closing price of the Company's
common stock for the ten (10)  trading  days prior to the date of this  Warrant,
subject to adjustment in accordance with Section 5 hereof.

         Warrants - this  Warrant and any other  Warrant or  Warrants  issued in
connection with a Commitment Letter dated March 21, 2000 executed by the Company
and Transamerica  Business Credit  Corporation (the "Commitment  Letter") to the
original holder of this Warrant, or any transferees from such original holder or
this Holder.


<PAGE>


         Warrant Shares - shares of Common Stock purchased or purchasable by the
Holder of this Warrant upon the exercise hereof.

SECTION 2.  Exercise of Warrant.

         2.1.  Procedure  for Exercise of Warrant.  To exercise  this Warrant in
whole or in part  (but not as to any  fractional  share of  Common  Stock),  the
Holder  shall  deliver to the  Company at its office  referred  to in Section 13
hereof at any time and from time to time  during the Term of this  Warrant:  (i)
the Notice of Exercise in the form  attached  hereto,  (ii) cash,  certified  or
official bank check payable to the order of the Company,  wire transfer of funds
to the Company's account,  or evidence of any indebtedness of the Company to the
Holder (or any combination of any of the foregoing) in the amount of the Warrant
Price for each share being  purchased,  and (iii) this Warrant.  Notwithstanding
any provisions  herein to the contrary,  if the Current Market Price (as defined
in Section 5) is greater than the Warrant Price (at the date of calculation,  as
set forth below),  in lieu of exercising this Warrant as hereinabove  permitted,
the Holder may elect to receive  shares of Common  Stock  equal to the value (as
determined  below) of this Warrant (or the portion  thereof  being  canceled) by
surrender of this Warrant at the office of the Company referred to in Section 13
hereof,  together with the Notice of Exercise,  in which event the Company shall
issue to the Holder that  number of shares of Common  Stock  computed  using the
following formula:

                               CS = WCS x (CMP-WP)
                                    -------------
                                        CMP

Where

         CS       equals  the  number of shares of Common  Stock to be issued to
                  the Holder

         WCS      equals the number of shares of Common Stock  purchasable under
                  the  Warrant  or, if only a portion  of the  Warrant  is being
                  exercised,  the portion of the Warrant being exercised (at the
                  date of such calculation)

         CMP      equals  the  Current   Market  Price  (at  the  date  of  such
                  calculation)

         WP       equals  the  Warrant  Price (as  adjusted  to the date of such
                  calculation)

In the event of any  exercise  of the  rights  represented  by this  Warrant,  a
certificate  or  certificates  for the  shares  of  Common  Stock so  purchased,
registered  in the  name of the  Holder  or such  other  name or names as may be
designated  by the Holder,  shall be  delivered  to the Holder  hereof  within a
reasonable time, not exceeding  fifteen (15) days, after the rights  represented
by this  Warrant  shall have been so  exercised;  and,  unless this  Warrant has
expired,  a new Warrant  representing  the number of shares  (except a remaining
fractional  share),  if any,  with respect to which this Warrant  shall not then
have been exercised  shall also be issued to the Holder hereof within such time.
The person in whose name any  certificate  for shares of Common  Stock is issued
upon  exercise of this  Warrant  shall for all purposes be deemed to have become
the  holder  of  record of such  shares  on the date on which  the  Warrant  was
surrendered and payment of the Warrant Price and any applicable  taxes was made,
irrespective  of the date of delivery of such  certificate,  except that, if the
date of such  surrender and payment is a date when the stock  transfer  books of
the Company are closed, such person shall be deemed to have become the holder of
such shares at the close of business  on the next  succeeding  date on which the
stock transfer books are open.


                                      -2-
<PAGE>


         2.2. Transfer  Restriction  Legend. Each certificate for Warrant Shares
shall bear the following  legend (and any additional  legend required by (i) any
applicable  state  securities  laws and (ii) any securities  exchange upon which
such Warrant  Shares may, at the time of such  exercise,  be listed) on the face
thereof  unless at the time of exercise such Warrant  Shares shall be registered
under the Securities Act:

         "The shares  represented by this  certificate  have not been registered
         under the  Securities  Act of 1933, as amended,  and may not be sold or
         transferred  in  the  absence  of  such  registration  or an  exemption
         therefrom under said Act."

Any  certificate  issued  at any  time  in  exchange  or  substitution  for  any
certificate bearing such legend (except a new certificate issued upon completion
of a  public  distribution  under a  registration  statement  of the  securities
represented  thereby)  shall also bear such  legend  unless,  in the  opinion of
counsel for the holder thereof  (which counsel shall be reasonably  satisfactory
to counsel for the Company) the securities  represented thereby are not, at such
time, required by law to bear such legend.

SECTION 3. Covenants as to Common Stock.  The Company  covenants and agrees that
all shares of Common  Stock that may be issued  upon the  exercise of the rights
represented by this Warrant will, upon issuance,  be validly issued,  fully paid
and  nonassessable,  and free from all taxes,  liens and charges with respect to
the issue  thereof.  The Company  further  covenants and agrees that it will pay
when due and payable any and all federal and state taxes which may be payable in
respect  of the  issue of this  Warrant  or any  Common  Stock  or  certificates
therefor  issuable  upon the  exercise  of this  Warrant.  The  Company  further
covenants  and agrees that the  Company  will at all times have  authorized  and
reserved,  free from preemptive  rights, a sufficient number of shares of Common
Stock to provide for the exercise of the rights represented by this Warrant. The
Company  further  covenants and agrees that if any shares of capital stock to be
reserved  for the purpose of the  issuance  of shares upon the  exercise of this
Warrant  require  registration  with or approval of any  governmental  authority
under any  federal or state law  before  such  shares  may be validly  issued or
delivered  upon   exercise,   then  the  Company  will  in  good  faith  and  as
expeditiously as possible endeavor to secure such  registration or approval,  as
the case may be. If and so long as the Common Stock  issuable  upon the exercise
of this Warrant is listed on any national securities exchange, the Company will,
if  permitted  by the  rules of such  exchange,  list and  keep  listed  on such
exchange,  upon  official  notice of  issuance,  all shares of such Common Stock
issuable upon exercise of this Warrant.

SECTION 4.  Adjustment of Number of Shares.  Upon each adjustment of the Warrant
Price as  provided  in Section 5, the Holder  shall  thereafter  be  entitled to
purchase,  at the Warrant Price  resulting from such  adjustment,  the number of
shares  (calculated to the nearest tenth of a share) obtained by multiplying the
Warrant Price in effect  immediately  prior to such  adjustment by the number of
shares  purchasable  pursuant  hereto  immediately  prior to such adjustment and
dividing  the  product   thereof  by  the  Warrant  Price  resulting  from  such
adjustment.

SECTION 5.  Adjustment of Warrant  Price.  The Warrant Price shall be subject to
adjustment from time to time as follows:

                  (i) If the  Company  shall  at any  time or from  time to time
during the Term of this Warrant issue shares of Common Stock other than Excluded
Stock (as hereinafter defined) without  consideration or for a consideration per
share less than the Warrant Price in effect immediately prior to the issuance of
such Common Stock,  the Warrant Price in effect  immediately  prior to each such
issuance or adjustment


                                      -3-
<PAGE>


shall  forthwith  (except as provided in this clause (i)) be adjusted to a price
equal to the quotient obtained by dividing:

                           (A)  an amount equal to the sum of

                           (x) the  total  number  of  shares  of  Common  Stock
                  outstanding  (including  any shares of Common  Stock deemed to
                  have been issued  pursuant to  subdivision  (3) of this clause
                  (i)  and to  clause  (ii)  below)  immediately  prior  to such
                  issuance multiplied by the Warrant Price in effect immediately
                  prior to such issuance, plus

                           (y)  the consideration received  by  the Company upon
                  such issuance,

         by

                           (B) the  total  number  of  shares  of  Common  Stock
                  outstanding  (including  any shares of Common  Stock deemed to
                  have been issued  pursuant to  subdivision  (3) of this clause
                  (i) and to clause (ii) below)  immediately  after the issuance
                  of such Common Stock.

         For the purposes of any  adjustment  of the Warrant  Price  pursuant to
this clause (i), the following provisions shall be applicable:

         1.       In the case of the  issuance  of Common  Stock  for cash,  the
                  consideration  shall be deemed  to be the  amount of cash paid
                  therefor after deducting therefrom any discounts,  commissions
                  or other expenses allowed, paid or incurred by the Company for
                  any  underwriting or otherwise in connection with the issuance
                  and sale thereof.

         2.       In  the  case  of  the   issuance   of  Common   Stock  for  a
                  consideration  in  whole  or in  part  other  than  cash,  the
                  consideration  other  than cash shall be deemed to be the fair
                  market value  thereof as  determined by the Board of Directors
                  of the  Company,  irrespective  of any  accounting  treatment;
                  provided,  however,  that such fair market value as determined
                  by  the   Board   of   Directors,   together   with  any  cash
                  consideration  being  paid,  shall not  exceed  the  aggregate
                  Current Market Price (as hereinafter defined) of the shares of
                  Common Stock being issued.

         3.       In the case of the  issuance  of (i)  options to  purchase  or
                  rights to subscribe for Common Stock, (ii) securities by their
                  terms  convertible  into or  exchangeable  for Common Stock or
                  (iii)  options to  purchase  or rights to  subscribe  for such
                  convertible or exchangeable securities:

                  (A)      the  aggregate  maximum  number  of  shares of Common
                           Stock  deliverable  upon  exercise of such options to
                           purchase  or rights to  subscribe  for  Common  Stock
                           shall be deemed to have been  issued at the time such
                           options or rights were issued and for a consideration
                           equal to the consideration  (determined in the manner
                           provided in  subdivisions  (1) and (2) above with the
                           proviso  in  subdivision  (2)  being  applied  to the
                           number of shares of  Common  Stock  deliverable  upon
                           such exercise),  if any, received by the Company upon
                           the


                                      -4-
<PAGE>


                           issuance  of such  options or rights plus the minimum
                           purchase price provided in such options or rights for
                           the Common Stock covered thereby;

                  (B)      the  aggregate  maximum  number  of  shares of Common
                           Stock  deliverable  upon conversion of or in exchange
                           for any such  convertible or exchangeable  securities
                           or upon the exercise of options to purchase or rights
                           to subscribe  for such  convertible  or  exchangeable
                           securities  and  subsequent  conversions or exchanges
                           thereof  shall be deemed  to have been  issued at the
                           time such  securities  were issued or such options or
                           rights were issued and for a  consideration  equal to
                           the  consideration  received  by the  Company for any
                           such   securities  and  related   options  or  rights
                           (excluding  any cash  received  on account of accrued
                           interest or accrued  dividends),  plus the additional
                           consideration,  if any, to be received by the Company
                           upon the conversion or exchange of such securities or
                           the  exercise of any  related  options or rights (the
                           consideration  in each case to be  determined  in the
                           manner  provided  in  subdivisions  (1) and (2) above
                           with the proviso in subdivision  (2) being applied to
                           the number of shares of Common Stock deliverable upon
                           such conversion, exchange or exercise);

                  (C)      on any change in the number of shares of Common Stock
                           deliverable  upon  exercise  of any such  options  or
                           rights  or   conversion   of  or  exchange  for  such
                           convertible or exchangeable securities,  other than a
                           change  resulting  from the  antidilution  provisions
                           thereof,   the  Warrant  Price  shall   forthwith  be
                           readjusted  to  such  Warrant  Price  as  would  have
                           obtained had the adjustment made upon the issuance of
                           such  options,  rights or  securities  not  converted
                           prior to such change or options or rights  related to
                           such  securities  not converted  prior to such change
                           being made upon the basis of such change; and

                  (D)      on the expiration of any such options or rights,  the
                           termination of any such rights to convert or exchange
                           or the expiration of any options or rights related to
                           such  convertible  or  exchangeable  securities,  the
                           Warrant  Price shall  forthwith be readjusted to such
                           Warrant   Price  as  would  have   obtained  had  the
                           adjustment  made upon the  issuance of such  options,
                           rights,  securities  or options or rights  related to
                           such  securities  being  made  upon the  basis of the
                           issuance of only the number of shares of Common Stock
                           actually  issued upon the  conversion  or exchange of
                           such  securities  or upon the exercise of the options
                           or rights related to such securities.

         (ii) "Excluded Stock" shall mean (A) shares of Common Stock issued upon
conversion of the shares of the Company's  outstanding  Series A Preferred Stock
or the  Series B  Preferred  Stock;  (B)  shares  of Common  Stock (or  options,
warrants or rights thereof) granted or issued  subsequent to the date of initial
issuance of this warrant (the "Issuance Date") to employees, officers, directors
of the  Company  or any  subsidiary  pursuant  to  incentive  agreements,  stock
purchase or stock option plans, stock bonuses or awards, warrants,  contracts or
other  arrangements that are approved by the Board of Directors;  (C) securities
issued by the  Corporation  representing  in the aggregate  five percent (5%) or
less of the then outstanding  shares of Common Stock, on a fully-diluted  basis,
to  contractors,  consultants,  advisers  to, or vendors  of, the  Company or in
connection  with  any  credit,   financing  or  leasing  agreements  or  similar
instruments with equipment lessors or other persons providing equipment lease or
other equipment financing;  (D) securities issued in connection with or pursuant
to the  acquisition  of all or any  portion  of


                                      -5-
<PAGE>


another company by the Company whether by merger or any other  reorganization or
by the purchase of all or any portion of the assets of another company, pursuant
to a plan,  agreement or other  arrangement  approved by the Board of Directors;
(E) securities  issued to or in connection with an arrangement or venture with a
strategic partner of the Company, provided such issuance is unanimously approved
by the Board of Directors;  (F) shares of Common Stock or preferred stock issued
or issuable upon the exercise of any warrants,  options or other rights that are
outstanding as of the Filing Date (or issued or issuable after the reissuance of
any such expired or terminated  options,  warrants or rights and net of any such
issued shares  repurchased by the Company);  (G) the reissuance or assignment by
the Company of any shares of Common Stock outstanding as of the Issuance Date to
a  different  person  from the  holder of such  shares;  (H)  securities  issued
pursuant to any anti-dilution  rights of the holders of Series A Preferred Stock
or  Series  B  Preferred  Stock  or  warrants  to  purchase  securities  of this
Corporation  that are  outstanding as of the Issuance Date; (I) shares of Common
Stock issued in a public  offering by this Company in which all shares of Series
A Preferred Stock and Series B Preferred Stock are automatically  converted into
shares of Common  Stock;  (J) shares of Common  Stock and  warrants  to purchase
Common Stock  issued by the Company on or prior to April 30, 2000 in  connection
with the Company's March 2000 Common Stock and Warrant offering,  and (K) shares
of Common  Stock  issued by way of dividend or other  distribution  on shares of
preferred stock and Common Stock deemed excluded stock by the foregoing  clauses
(A), (B), (C), (D), (E), (F), (G), (H), (I), (J) and this clause (K).

         (iii) If, at any time  during the Term of this  Warrant,  the number of
shares of Common Stock  outstanding is increased by a stock dividend  payable in
shares of  Common  Stock or by a  subdivision  or  split-up  of shares of Common
Stock, then, following the record date fixed for the determination of holders of
Common Stock entitled to receive such stock  dividend,  subdivision or split-up,
the Warrant Price shall be appropriately  decreased so that the number of shares
of  Common  Stock  issuable  upon the  exercise  hereof  shall be  increased  in
proportion to such increase in outstanding shares.

         (iv) If, at any time  during  the Term of this  Warrant,  the number of
shares  of  Common  Stock  outstanding  is  decreased  by a  combination  of the
outstanding  shares of Common  Stock,  then,  following the record date for such
combination,  the Warrant Price shall appropriately  increase so that the number
of shares of Common Stock  issuable upon the exercise  hereof shall be decreased
in proportion to such decrease in outstanding shares.

         (v) In case, at any time during the Term of this  Warrant,  the Company
shall declare a cash dividend upon its Common Stock payable  otherwise  than out
of earnings or earned surplus or shall distribute to holders of its Common Stock
shares of its capital stock (other than Common Stock), stock or other securities
of other  persons,  evidences  of  indebtedness  issued by the  Company or other
persons,  assets  (excluding  cash  dividends and  distributions)  or options or
rights  (excluding  options to purchase and rights to subscribe for Common Stock
or other  securities of the Company  convertible into or exchangeable for Common
Stock), then, in each such case, immediately following the record date fixed for
the  determination  of the  holders of Common  Stock  entitled  to receive  such
dividend  or  distribution,  the  Warrant  Price in effect  thereafter  shall be
determined by multiplying the Warrant Price in effect  immediately prior to such
record date by a fraction of which the numerator shall be an amount equal to the
difference  of (x) the Current  Market  Price of one share of Common Stock minus
(y) the fair  market  value  (as  determined  by the Board of  Directors  of the
Company,  whose  determination  shall be conclusive)  of the stock,  securities,
evidences of indebtedness,  assets,  options or rights so distributed in respect
of one share of Common Stock, and of which the denominator shall be such Current
Market Price.


                                      -6-
<PAGE>


         (vi) All calculations under this Section 5 shall be made to the nearest
cent or to the nearest one-tenth (1/10) of a share, as the case may be.

         (vii) For the purpose of any  computation  pursuant to this  Section 5,
the  Current  Market  Price at any date of one  share of Common  Stock  shall be
deemed to be the  average of the daily  closing  prices  for the 15  consecutive
business  days ending on the last  business  day before the day in question  (as
adjusted for any stock dividend,  split,  combination or  reclassification  that
took effect during such 15 business day period).  The closing price for each day
shall be the last reported  sales price regular way or, in case no such reported
sales took place on such day,  the  average of the last  reported  bid and asked
prices regular way, in either case on the principal national securities exchange
on which the Common  Stock is listed or  admitted  to trading or as  reported by
Nasdaq (or if the Common Stock is not at the time listed or admitted for trading
on any such exchange or if prices of the Common Stock are not reported by Nasdaq
then such price shall be equal to the average of the last reported bid and asked
prices on such day as reported by The National Quotation Bureau  Incorporated or
any similar reputable  quotation and reporting service, if such quotation is not
reported by The National Quotation Bureau Incorporated); provided, however, that
if the Common Stock is not traded in such manner that the quotations referred to
in this clause (v) are available for the period required hereunder,  the Current
Market Price shall be  determined in good faith by the Board of Directors of the
Company or, if such  determination  cannot be made,  by a nationally  recognized
independent  investment  banking firm  selected by the Board of Directors of the
Company  (or if such  selection  cannot  be  made,  by a  nationally  recognized
independent  investment  banking  firm  selected  by  the  American  Arbitration
Association in accordance with its rules).

         (viii)  Whenever  the  Warrant  Price  shall be adjusted as provided in
Section 5, the Company  shall  prepare a statement  showing the facts  requiring
such  adjustment  and the  Warrant  Price  that  shall be in effect  after  such
adjustment. The Company shall cause a copy of such statement to be sent by mail,
first class postage  prepaid,  to each Holder of this Warrant at its, his or her
address appearing on the Company's records. Where appropriate,  such copy may be
given in advance and may be included as part of the notice required to be mailed
under the provisions of subsection (x) of this Section 5.

         (ix)  Adjustments  made pursuant to clauses  (iii),  (iv) and (v) above
shall be made on the date such dividend,  subdivision,  split-up, combination or
distribution,  as the case may be, is made,  and shall  become  effective at the
opening of business on the business day next  following  the record date for the
determination of stockholders entitled to such dividend, subdivision,  split-up,
combination or distribution.

         (x) In the event the  Company  shall  propose to take any action of the
types  described in clauses  (iii),  (iv), or (v) of this Section 5, the Company
shall  forward,  at the same time and in the same manner,  to the Holder of this
Warrant  such  notice,  if any,  which the Company  shall give to the holders of
capital stock of the Company.

         (xi) In any  case in  which  the  provisions  of this  Section  5 shall
require that an adjustment  shall become  effective  immediately  after a record
date for an event,  the  Company may defer  until the  occurrence  of such event
issuing  to the  Holder of all or any part of this  Warrant  which is  exercised
after such record date and before the  occurrence  of such event the  additional
shares of capital stock  issuable upon such exercise by reason of the adjustment
required by such event over and above the shares of capital stock  issuable upon
such  exercise  before  giving  effect to such  adjustment  exercise;  provided,
however,  that the  Company  shall  deliver  to such  Holder a due bill or other
appropriate instrument


                                      -7-
<PAGE>


evidencing  such  Holder's  right to receive  such  additional  shares  upon the
occurrence of the event requiring such adjustment.

SECTION 6.  Ownership.

         6.1.  Ownership  of This  Warrant.  The  Company may deem and treat the
person in whose name this Warrant is  registered  as the holder and owner hereof
(notwithstanding  any  notations of  ownership or writing  hereon made by anyone
other than the Company) for all purposes and shall not be affected by any notice
to the contrary until  presentation of this Warrant for registration of transfer
as provided in this Section 6.

         6.2.  Transfer and  Replacement.  This Warrant and all rights hereunder
are transferable in whole or in part upon the books of the Company by the Holder
hereof in person or by duly authorized attorney,  and a new Warrant or Warrants,
of the same tenor as this Warrant but  registered in the name of the  transferee
or  transferees  (and in the  name  of the  Holder,  if a  partial  transfer  is
effected)  shall be made and  delivered  by the Company  upon  surrender of this
Warrant duly  endorsed,  at the office of the Company  referred to in Section 13
hereof. Upon receipt by the Company of evidence reasonably satisfactory to it of
the loss,  theft or  destruction,  and, in such case,  of  indemnity or security
reasonably  satisfactory to it, and upon surrender of this Warrant if mutilated,
the Company  will make and deliver a new Warrant of like tenor,  in lieu of this
Warrant;  provided that if the Holder hereof is an instrumentality of a state or
local  government  or  an  institutional   holder  or  a  nominee  for  such  an
instrumentality or institutional holder an irrevocable agreement of indemnity by
such Holder  shall be  sufficient  for all  purposes  of this  Section 6, and no
evidence of loss or theft or destruction shall be necessary.  This Warrant shall
be promptly  cancelled by the Company upon the  surrender  hereof in  connection
with any transfer or  replacement.  Except as otherwise  provided  above, in the
case of the loss,  theft or destruction of a Warrant,  the Company shall pay all
expenses,  taxes and other charges  payable in  connection  with any transfer or
replacement of this Warrant, other than stock transfer taxes (if any) payable in
connection  with a  transfer  of this  Warrant,  which  shall be  payable by the
Holder. Holder will not transfer this Warrant and the rights hereunder except in
compliance with federal and state securities laws.

SECTION  7.  Mergers,  Consolidation,   Sales.  In  the  case  of  any  proposed
consolidation or merger of the Company with another entity, or the proposed sale
of all or  substantially  all of its assets to another person or entity,  or any
proposed reorganization or reclassification of the capital stock of the Company,
then, as a condition of such  consolidation,  merger,  sale,  reorganization  or
reclassification, lawful and adequate provision shall be made whereby the Holder
of this Warrant  shall  thereafter  have the right to receive upon the basis and
upon the terms and  conditions  specified  herein,  in lieu of the shares of the
Common Stock of the Company immediately theretofore purchasable hereunder,  such
shares of stock,  securities or assets as may (by virtue of such  consolidation,
merger,  sale,  reorganization  or  reclassification)  be issued or payable with
respect  to or in  exchange  for the  number  of  shares  of such  Common  Stock
purchasable  hereunder  immediately  before such  consolidation,  merger,  sale,
reorganization or reclassification. In any such case appropriate provision shall
be made with  respect to the rights and  interests of the Holder of this Warrant
to the end that the provisions  hereof shall  thereafter be applicable as nearly
as may be, in relation to any shares of stock,  securities or assets  thereafter
deliverable upon the exercise of this Warrant.

SECTION 8. Notice of Dissolution or Liquidation.  In case of any distribution of
the  assets  of  the  Company  in  dissolution  or  liquidation   (except  under
circumstances  when the foregoing  Section 7 shall be  applicable),  the Company
shall give notice thereof to the Holder hereof and shall make no distribution to


                                      -8-
<PAGE>


shareholders  until the  expiration of thirty (30) days from the date of mailing
of the  aforesaid  notice and, in any case,  the Holder hereof may exercise this
Warrant within thirty (30) days from the date of the giving of such notice,  and
all rights herein granted not so exercised  within such thirty-day  period shall
thereafter become null and void.

SECTION 9. Notice of Extraordinary  Dividends.  If the Board of Directors of the
Company  shall  declare any dividend or other  distribution  on its Common Stock
except out of earned surplus or by way of a stock dividend  payable in shares of
its Common Stock, the Company shall mail notice thereof to the Holder hereof not
less than  thirty  (30) days  prior to the  record  date  fixed for  determining
shareholders entitled to participate in such dividend or other distribution, and
the Holder hereof shall not  participate in such dividend or other  distribution
unless this Warrant is exercised  prior to such record date.  The  provisions of
this  Section  9 shall  not  apply  to  distributions  made in  connection  with
transactions covered by Section 7.

SECTION 10.  Fractional  Shares.  Fractional shares shall not be issued upon the
exercise of this Warrant but in any case where the Holder would,  except for the
provisions  of this Section 10, be entitled  under the terms hereof to receive a
fractional share upon the complete exercise of this Warrant,  the Company shall,
upon the  exercise of this  Warrant for the largest  number of whole shares then
called  for,  pay a sum in  cash  equal  to the  excess  of the  value  of  such
fractional share  (determined in such reasonable  manner as may be prescribed in
good faith by the Board of Directors of the Company)  over the Warrant Price for
such fractional share.

SECTION 11.  Special  Arrangements  of the Company.  The Company  covenants  and
agrees that during the Term of this Warrant,  unless  otherwise  approved by the
Holder of this Warrant:

         11.1. Will Reserve  Shares.  The Company will reserve and set apart and
have  available  for  issuance  at all  times,  free  from  preemptive  or other
preferential  rights,  the number of shares of  authorized  but unissued  Common
Stock deliverable upon the exercise of this Warrant.

         11.2.  Will Not  Amend  Certificate.  The  Company  will not  amend its
Certificate  of  Incorporation  to eliminate as an  authorized  class of capital
stock that class denominated as "Common Stock" on the date hereof.

         11.3.  Will Bind  Successors.  This  Warrant  shall be binding upon any
corporation  or other  person or entity  succeeding  to the  Company  by merger,
consolidation  or  acquisition  of all  or  substantially  all of the  Company's
assets.

SECTION 12.  Intentionally Deleted.

         SECTION 13. Notices. Any notice or other document required or permitted
to be  given or  delivered  to the  Holder  shall be  delivered  at,  or sent by
certified or registered mail to, the Holder at Transamerica  Technology  Finance
Division,  76 Batterson Park Road,  Farmington,  Connecticut  06032,  Attention:
Assistant Vice  President,  Lease  Administration,  with a copy to the Lender at
Riverway II, West Office  Tower,  9399 West  Higgins  Road,  Rosemont,  Illinois
60018,  Attention:  Legal Department or to such other address as shall have been
furnished to the Company in writing by the Holder.  Any notice or other document
required or permitted to be given or delivered to the Company shall be delivered
at, or sent by certified or registered  mail to, the Company at 360 22nd Street,
Suite 210, Oakland, California 94612, Attention: Loan Administration, or to such
other  address  as shall  have been


                                      -9-
<PAGE>


furnished in writing to the Holder by the Company.  Any notice so addressed  and
mailed by  registered  or  certified  mail  shall be deemed to be given  when so
mailed.  Any notice so addressed and otherwise  delivered  shall be deemed to be
given when actually received by the addressee.

SECTION 14. No Rights as  Stockholder;  Limitation  of  Liability.  This Warrant
shall not  entitle  the  Holder to any of the  rights  of a  shareholder  of the
Company except upon exercise in accordance  with the terms hereof.  No provision
hereof, in the absence of affirmative action by the Holder to purchase shares of
Common Stock, and no mere enumeration  herein of the rights or privileges of the
Holder,  shall give rise to any  liability  of the Holder for the Warrant  Price
hereunder or as a shareholder of the Company, whether such liability is asserted
by the Company or by creditors of the Company.

SECTION 15. Law Governing. THE VALIDITY, INTERPRETATION, AND ENFORCEMENT OF THIS
WARRANT SHALL BE GOVERNED BY AND  CONSTRUED IN  ACCORDANCE  WITH THE LAWS OF THE
STATE OF  ILLINOIS  WITHOUT  GIVING  EFFECT TO THE  CONFLICT  OF LAW  PRINCIPLES
THEREOF.

SECTION 16.  Miscellaneous.

                  (a) This  Warrant  and any  provision  hereof may be  changed,
waived, discharged or terminated only by an instrument in writing signed by both
parties (or any  respective  predecessor in interest  thereof).  The headings in
this Warrant are for purposes of reference only and shall not affect the meaning
or construction of any of the provisions hereof

                  (b) All  capitalized  terms  used  herein  and  not  otherwise
defined  herein  shall have the  meanings  ascribed to them in the Master  Lease
Agreement.

         IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by
its duly authorized officer this 11th day of April, 2000.


                                                  VALUESTAR CORPORATION
[CORPORATE SEAL]
                                                  By:  /s/ Michael Kelly

                                                  Title:  Controller

                                      -10-
<PAGE>



                           FORM OF NOTICE OF EXERCISE

                [To be signed only upon exercise of the Warrant]

                     TO BE EXECUTED BY THE REGISTERED HOLDER
                         TO EXERCISE THE WITHIN WARRANT

         The undersigned hereby exercises the right to purchase _________ shares
of Common  Stock which the  undersigned  is entitled to purchase by the terms of
the within Warrant according to the conditions thereof, and herewith

[check one]

                         [ ]       makes payment of $__________ therefor; or

                         [ ]       directs the Company to issue  ______  shares,
                                   and  to  withhold  ____  shares  in  lieu  of
                                   payment of the Warrant Price, as described in
                                   Section 2.1 of the Warrant.

All shares to be issued  pursuant  hereto shall be issued in the name of and the
initial  address of such person to be entered on the books of the Company  shall
be:

         The  shares  are  to  be  issued  in   certificates  of  the  following
denominations:


                                                  ------------------------------
                                                  [Type Name of Holder]


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

Dated:
      --------------------------------------------------------------------------


                                      -11-
<PAGE>



                               FORM OF ASSIGNMENT
                                    (ENTIRE)

               [To be signed only upon transfer of entire Warrant]

                     TO BE EXECUTED BY THE REGISTERED HOLDER
                         TO TRANSFER THE WITHIN WARRANT

         FOR VALUE RECEIVED  ___________________________  hereby sells,  assigns
and transfers unto _______________________________ all rights of the undersigned
under and  pursuant  to the within  Warrant,  and the  undersigned  does  hereby
irrevocably constitute and appoint  _______________________________  Attorney to
transfer  the said  Warrant  on the books of the  Company,  with  full  power of
substitution.


                                       -----------------------------------------
                                       [Type Name of Holder]


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

Dated:
      --------------------------------

NOTICE

         The signature to the foregoing  Assignment  must correspond to the name
as written  upon the face of the within  Warrant  in every  particular,  without
alteration or enlargement or any change whatsoever.


                                      -12-
<PAGE>





                               FORM OF ASSIGNMENT

                                    (PARTIAL)

              [To be signed only upon partial transfer of Warrant]

                     TO BE EXECUTED BY THE REGISTERED HOLDER

                         TO TRANSFER THE WITHIN WARRANT

         FOR VALUE RECEIVED  _________________________ hereby sells, assigns and
transfers unto _______________________________ (i) the rights of the undersigned
to purchase ___ shares of Common Stock under and pursuant to the within Warrant,
and (ii) on a non-exclusive basis, all other rights of the undersigned under and
pursuant to the within Warrant,  it being understood that the undersigned  shall
retain,  severally (and not jointly) with the  transferee(s)  named herein,  all
rights  assigned  on such  non-exclusive  basis.  The  undersigned  does  hereby
irrevocably  constitute  and  appoint  __________________________   Attorney  to
transfer  the said  Warrant  on the books of the  Company,  with  full  power of
substitution.


                                       -----------------------------------------
                                       [Type Name of Holder]


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

Dated:
      --------------------------------


NOTICE

         The signature to the foregoing  Assignment  must correspond to the name
as written  upon the face of the within  Warrant  in every  particular,  without
alteration or enlargement or any change whatsoever.


                                      -13-