Exhibit 10.4










_________________
___, 20__










FCC, LLC
d/b/a First Capital


3520 NW
58th
Street


Oklahoma
City, Oklahoma   73112








Re:
            AGREEMENT OF SUBORDINATION AND
      ASSIGNMENT





__________________:





The
undersigned, _____________________________ (“Creditor”), is a creditor of the
undersigned, Aerogrow International, Inc. (“Borrower”), whose Liabilities
(meaning herein any obligations of Borrower under any note, agreement, contract
of suretyship, guaranty or accommodation, claim or right of action, and any
other obligations of Borrower however and whenever created, arising or
evidenced, whether direct or indirect, through assignment from third parties,
absolute, contingent, or otherwise, now or hereafter existing, or due or to
become due, including all interest which accrues on any such obligations both
before and after the filing by or against Borrower of a petition under any
chapter of Title 11 of the United States Code, as amended (the “Bankruptcy
Code”), together with all collection costs and attorneys' fees), in favor of
Creditor as of the date hereof aggregate $____________, are described on
Schedule A attached hereto, and may in the future increase (all such
Liabilities of Borrower in favor of Creditor being collectively referred to
herein as the “Junior Claims”).





For value
received, and to induce you to enter into financial transactions with Borrower,
including the making of a loan or loans to it or the entering into with it of
any agreement with regard to the assignment of accounts receivable or other
indebtedness in connection with the sale of goods or rendition of services made
or to be made by Borrower, or to purchase or take by assignment receivables
under any agreement with regard to the assignment of accounts receivable, or to
cause letters of credit to be issued for the account of Borrower (all
Liabilities of Borrower under any such loans and agreements, and all other
Liabilities of Borrower in favor of you, being collectively referred to herein
as the “Senior Claims”), Creditor hereby subordinates and postpones the Junior
Claims to the Senior Claims.





In order
to effect and secure such subordination, Creditor hereby assigns to you all of
Creditor's right, title and interest in and to the Junior Claims and any
security held therefor, and will deliver to you from time to time any and all
instruments and documents (endorsed to you without recourse in the case of
negotiable instruments) evidencing such Junior Claims, or will have entered on
such instruments and documents such subordination legend as you may request, and
Creditor will execute such other instruments and documents as you may from time
to time require in connection therewith.  In the event that any Junior
Claim is not evidenced by a negotiable instrument, Creditor hereby agrees that
he will obtain an instrument or document from Borrower evidencing such Junior
Claim.  In the event that such debt is not evidenced by a document, it
shall nevertheless be deemed subordinated and assigned by virtue of this
Agreement.








Creditor
hereby grants to you irrevocable authority in the place and stead of Creditor
and in the name of Creditor or in your name but for your use and benefit, at any
time or times, after any default under the terms of any of the Senior Claims, in
your discretion to demand, collect, compromise, file proofs of claim with
respect to, receive (by way of dividends or otherwise) and take any and all
legal proceedings for the recovery of any and all moneys due or to become due on
account of the Junior Claims or any thereof, and to vote, give consents and take
any other steps with regard thereto.  Any and all moneys so collected
or received by you shall be retained indefeasibly by you for application to the
payment in full of the Senior Claims then outstanding; provided, however, that
upon termination of this Agreement by you and the indefeasible payment to you of
moneys collected or received on account of Junior Claims and on account of
Senior Claims aggregating an amount equivalent to all the matured and unmatured
Senior Claims, you shall pay over to Creditor the excess, if any, of all moneys
so received or collected on the Junior Claims and on the Senior Claims and
release the balance of the Junior Claims and the Senior Claims which are still
unpaid, and deliver to Creditor any and all instruments and documents, without
any warranties of any nature or type whatsoever in respect thereof (endorsed to
Creditor without recourse in the case of negotiable instruments) evidencing such
Junior Claims and Senior Claims.  If you receive notice of any claim
adverse to the rights or interests of Creditor in and to either the Junior
Claims or the Senior Claims, or any moneys held by you in respect thereof, you
shall be entitled to retain any and all such moneys, and documents and
instruments evidencing such Junior Claims and Senior Claims without incurring
any liability or debt to Creditor, until the adjudication or final settlement of
the rights of such claimant against Creditor, and Creditor hereby agrees to
indemnify and hold you harmless for any and all liability and expenses incurred
by you and arising from or connected with the assertion of such
claims.





Creditor
hereby releases any lien on or security interest Creditor may have in any of
Borrower’s assets, and Creditor and Borrower acknowledge and agree that the
Junior Claims are and shall remain unsecured by any of Borrower’s assets unless
and until the Senior Claims are repaid in full in cash and any commitment of
yours to provide financing to Borrower is terminated.  Creditor hereby
authorizes you to terminate any UCC financing statements naming Creditor as
secured party and Borrower as debtor.





Creditor
further agrees that so long as any Senior Claim remains unpaid, Creditor will
not accept from Borrower any payment on account of, or any security for, any
Junior Claim.  In case Borrower shall offer any payment on account of,
or any security for, any Junior Claim, Creditor will direct that the same be
made or delivered to you, and in the event of any moneys and/or security coming
into the hands of Creditor on account of any Junior Claim from any source
whatsoever, Creditor will receive the same solely as your agent in trust for you
and will immediately turn over to you the same, in the form
received.  If Creditor shall fail to endorse any instrument for the
payment of money payable to Creditor or to Creditor's order, which has been
turned over to you, you are hereby irrevocably constituted and appointed
attorney-in-fact for Creditor with full power to make any such endorsement, and
with full power of substitution.








At your
request, Creditor hereby further agrees (i) to make notations on Creditor's
books to the effect that such Junior Claim is subject to the provisions of this
Agreement, (ii) to give you, upon request from time to time, access to
Creditor's books with respect to such accounts and the right to make copies of
such books, and (iii) to furnish you, upon request from time to time, with
statements of such accounts between Creditor and Borrower.





Creditor
hereby represents to you that (i) Borrower is now indebted to Creditor,
without counterclaim, defense or offset on the Junior Claims described in
Schedule A, (ii) Creditor has not heretofore assigned, transferred, created
a security interest in, or otherwise encumbered such Junior Claims nor executed
or delivered any other instrument or document adversely affecting the Junior
Claims, (iii) the Junior Claims are not represented by any instruments or
documents except such as have been endorsed or assigned and delivered to you, or
which have been marked with such subordination legend as you have requested, and
(iv) Creditor is not insolvent within any meaning of that term as of the date
hereof.  Creditor agrees with you that Creditor will not assign,
transfer, create a security interest in, or otherwise encumber, or subordinate
in favor of any other creditor of Borrower, any Junior Claim and that any Junior
Claim now or hereafter existing will not be represented by any instruments or
documents other than those which have been endorsed or assigned and delivered to
you or marked with such subordination legend as you have requested.





All
moneys received by you on account of any Junior Claims shall belong to you and
shall be retained indefeasibly by you for application to the payment of the
Senior Claims.





For value
received, and to induce you to enter into financial transactions with Borrower
as described above, Borrower agrees that it will not pay or disburse any money
or transfer any property to Creditor in payment of any of the Junior Claims
until the Senior Claims are repaid in full and all financing arrangements
between you and Borrower are terminated, and Borrower agrees that any breach or
termination of this Agreement on Creditor's or Borrower's part shall constitute
a default under all of the Senior Claims with the same force and effect as if
this Agreement were incorporated into any such Senior Claims, and you may,
without notice or demand declare all of the Senior Claims immediately due and
payable.





This
Agreement is a continuing agreement and, unless you shall have specifically
consented in writing to its revocation, shall remain in full force and effect in
all respects whether or not Borrower shall at any time be indebted to
you.  If, after the payment of all Senior Claims, Borrower thereafter
again becomes liable to you on account of any new Senior Claims, this Agreement
shall thereupon in all respects become effective with respect to any such new
Senior Claims without the necessity of any further act or understanding by
Borrower and/or you.










If
Creditor receives any payment on account of, or any security for, any Junior
Claims at a time when there are no Senior Claims outstanding, Creditor will
immediately notify you in writing of the receipt thereof.  In the
event that Creditor fails to so notify you, and new Senior Claims are thereafter
created, and if Borrower defaults with respect to the payment or performance of
such new Senior Claims, in addition to and not in limitation of any other rights
or remedies available to you hereunder, you shall have the right to receive and
Creditor will immediately pay to you an amount equivalent to any such payment or
the value of any such security received by Creditor and not reported to
you.





With or
without notice to or further assent from Creditor, you may at any time or times,
either prior to or after any default on the part of Borrower with respect to
either the Junior Claims or the Senior Claims:  (a) advance or
refuse to advance additional credit to Borrower, (b) extend, refuse to
extend, renew or change the Senior Claims or any thereof and waive any default
under any thereof, and modify, rescind or waive any provision of any related
agreement or collateral undertaking, including, but not by way of limitation,
any provision relating to acceleration of maturity, (c) fail to set off any
or all accrued balances or deposit balances or any part thereof on your books in
favor of Borrower and release the same, (d) release, exchange, fail to
resort to, or realize upon, or apply any security or any part thereof held by or
available to you for the Senior Claims, and (e) generally deal with
Borrower in such manner as you may see fit, all without impairing or affecting
your rights and remedies under this Agreement.  Each such action and
each such failure to act on your part shall be deemed to be at the request of
Creditor and in reliance upon this Agreement.  Creditor hereby waives
notice of the acceptance of this Agreement by you and of the effecting by you of
any loans or extensions of credit to Borrower, and further waives notice of any
default at any time or times on the part of Borrower.  This Agreement
is not to be affected or impaired by any extension, renewal, release,
arrangement, or composition which you may grant Borrower.





This
Agreement revokes and supersedes any prior agreement of subordination or
assignment with respect to the Junior Claims which may have been executed by
Creditor in your favor.





No delay
or failure on your part in exercising any right or remedy shall operate as a
waiver thereof; and no single or partial exercise of any right or remedy shall
preclude other or further exercises thereof or the exercise of any right or
remedy; and no notice to or demand on Borrower or Creditor shall be deemed a
waiver of any obligation or duty of Borrower or Creditor or of your right to
take further action without notice or demand; nor in any event shall any
modification, alteration or waiver of any of the provisions hereof be effective
unless in writing and signed for or on behalf of you and then only in the
specific instance for which given.





ALL
PARTIES TO THIS AGREEMENT WAIVE TRIAL BY JURY IN ANY LITIGATION ARISING OUT OF
OR RELATING TO THE JUNIOR CLAIMS OR THIS AGREEMENT, AND CREDITOR WAIVES ALL
RIGHTS TO INTERPOSE THEREIN COUNTERCLAIMS OR OFFSETS OF ANY KIND.









Your
rights and privileges hereunder shall inure to the benefit of your successors
and assigns, including without limitation any substitute or replacement
financier of Borrower, and this Agreement shall be binding upon the Creditor's
and Borrower's respective heirs and personal representatives and successors and
assigns.  Creditor and Borrower waive notice of assignment
hereof.





This
Agreement shall be governed by, and construed and enforced in accordance with,
the laws of the State of Oklahoma.  Wherever possible, each provision
of this Agreement shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Agreement shall be
prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Agreement.





Notwithstanding
anything to the contrary contained in this Agreement, Borrower may pay, and
Creditor may take and receive, regularly scheduled payments of principal and
interest on the Junior Claims so long as (a) no default or event of default
exists under that certain Loan and Security Agreement dated June 23, 2008
between Borrower and you, as amended, modified and/or restated from time to time
(the “Loan Agreement”), or would otherwise be caused thereby; (b) after giving
effect to the proposed payment, Borrower would have unused borrowing
availability under the Loan Agreement of at least $_______________; and (c) at
least five (5) business days prior to making any such payment, Borrower shall
deliver to you a certificate of an officer of Borrower (i) setting forth the
amount of and the date of such proposed payment, (ii) certifying that no default
or event of default exists under the Loan Agreement, and (iii) setting forth
calculations, in detail reasonably satisfactory to you, demonstrating compliance
with the foregoing clauses (a) and (b).











IN WITNESS WHEREOF, Creditor and
Borrower have executed this Agreement this _____ day of ________________,
20__.








CREDITOR:





_________________________________________





By:


Name:


Title:








BORROWER:





AEROGROW INTERNATIONAL,
INC.








By:


Jervis B.
Perkins, President and


Chief
Executive Officer























The foregoing Subordination Agreement
is accepted in Oklahoma City, Oklahoma this _____ day of ________________,
20__.








FCC, LLC d/b/a First
Capital








By:


Lee E.
Elmore, Senior Vice President











Schedule A





Promissory
Note dated _________________, in the amount of $____________ executed by
Aerogrow International, Inc. and payable to
_______________________________.