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                                                                   Exhibit 10.26

                          EXECUTIVE RETENTION AGREEMENT

         THIS EXECUTIVE RETENTION AGREEMENT is made as of November 17, 2000 by
and between Open Market, Inc., a Delaware corporation (the "Company"), and Ed
Durkin (the "Executive").

         The Board of Directors of the Company (the "Board") has determined that
it is in the best interests of the Company and its shareholders to assure that
the Company will have the continued dedication of the Executive, notwithstanding
the possibility, threat or occurrence of a Change of Control (as defined below)
of the Company. The Board believes it is imperative to diminish the inevitable
distraction of the Executive by virtue of the personal uncertainties and risks
created by a pending or threatened Change of Control and to encourage the
Executive's full attention and dedication to the Company currently and in the
event of any threatened or pending Change of Control, and to provide the
Executive with compensation and benefits arrangements upon a Change of Control
which ensure that the compensation and benefits expectations of the Executive
will be satisfied and which are competitive with those of other corporations.
Therefore, in order to accomplish these objectives, the Board has caused the
Company to enter into this Agreement.

         NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

         1. CERTAIN DEFINITIONS.

                  (a) The "Effective Date" shall mean the first date during the
Change of Control Period (as defined in Section 1(b)) on which a Change of
Control (as defined in Section 2) occurs. Anything in this Agreement to the
contrary notwithstanding, if a Change of Control occurs and if the Executive's
employment with the Company is terminated prior to the date on which the Change
of Control occurs, and if it is reasonably demonstrated by the Executive that
such termination of employment (i) was at the request of a third party who has
taken steps reasonably calculated to effect a Change of Control or (ii)
otherwise arose in connection with or anticipation of a Change of Control, then
for all purposes of this Agreement the "Effective Date" shall mean the date
immediately prior to the date of such termination of employment.

                  (b) The "Change of Control Period" shall mean the period
commencing on the date hereof and ending on the second anniversary of the date
hereof; provided, however, that commencing on the date one year after the date
hereof, and on each annual anniversary of such date (such date and each annual
anniversary thereof shall be hereinafter referred to as the

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"Renewal Date"), unless previously terminated, the Change of Control Period
shall be automatically extended so as to terminate two years from such Renewal
Date, unless at least 90 days prior to the Renewal Date the Company shall give
notice to the Executive that the Change of Control Period shall not be so
extended.

         2. CHANGE OF CONTROL. For the purpose of this Agreement, a "Change of
Control" shall mean:

                  (a) The acquisition by an individual, entity or group (within
the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"))(a "Person") of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 50% or
more of either (i) the then-outstanding shares of common stock of the Company
(the "Outstanding Company Common Stock") or (ii) the combined voting power of
the then-outstanding voting securities of the Company entitled to vote generally
in the election of directors (the "Outstanding Company Voting Securities");
provided, however, that for purposes of this subsection (a), the following
acquisitions shall not constitute a Change of Control: (i) any acquisition
directly from the Company, (ii) any acquisition by the Company, (iii) any
acquisition by any employee benefit plan (or related trust) sponsored or
maintained by the Company or any corporation controlled by the Company, or (iv)
any acquisition by any corporation pursuant to a transaction which satisfies the
criteria set forth in clauses (i), (ii) and (iii) of subsection (c) of this
Section 2; or

                  (b) Individuals who, as of the date hereof, constitute the
Board (the "Incumbent Board") cease for any reason to constitute at least a
majority of the Board; provided, however, that any individual becoming a
director subsequently to the date hereof whose election, or nomination for
election by the Company's shareholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the
Board; or

                  (c) Consummation of a reorganization, merger or consolidation
or sale or other disposition of all or substantially all of the assets of the
Company (a "Business Combination"), in each case, unless, following such
Business Combination, (i) all or substantially all of the individuals and
entities who were the beneficial owners, respectively, of the Outstanding
Company Common Stock and Outstanding Company Voting Securities immediately prior
to such Business Combination beneficially own, directly or indirectly, more than
50% of, respectively, the then-outstanding shares of common stock and the
combined voting power of the then-outstanding voting securities entitled to vote
generally in the election of directors of the corporation resulting from such
Business Combination (which as used in this Section 2(c) shall include, without
limitation, a corporation which as a result of such transaction

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owns the Company or all or substantially all of the Company's assets either
directly or through one or more subsidiaries) in substantially the same
proportions as their ownership, immediately prior to such Business Combination
of the Outstanding Company Common Stock and Outstanding Company Voting
Securities, as the case may be, (ii) no Person (excluding any corporation
resulting from such Business Combination or any employee benefit plan (or
related trust) of the Company or such corporation resulting from such Business
Combination) beneficially owns, directly or indirectly, 50% or more of,
respectively, the then outstanding shares of common stock of the corporation
resulting from such Business Combination, or the combined voting power of the
then-outstanding voting securities of such corporation and (iii) at least half
of the members of the board of directors of the corporation resulting from such
Business Combination were members of the Incumbent Board at the time of the
execution of the initial agreement, or of the action of the Board, providing for
such Business Combination.

         3. EMPLOYMENT PERIOD. The Company hereby agrees to continue the
Executive in its employ, and the Executive hereby agrees to remain in the employ
of the Company subject to the terms and conditions of this Agreement, for the
period commencing on the Effective Date and ending on the first anniversary of
such date (the "Employment Period"). Except as provided in Section 1(a), nothing
in this Agreement shall, prior to the Effective Date, impose upon the Company
any obligation to retain the Executive, either as an employee or as a Section 16
Officer of the Company ("Corporate Officer"). In addition, nothing in this
Agreement shall restrict the Executive from terminating his employment with the
Company, and no such termination by the Executive shall be deemed a breach of
this Agreement.

         4. TERMS OF EMPLOYMENT.

            (a) POSITION AND DUTIES.

                (i) During the Employment Period, (A) the Executive's position
(including status, offices, titles and reporting requirements), authority,
duties and responsibilities shall be substantially commensurate in all material
respects with the most significant of those held, exercised and assigned at any
time during the 120-day period immediately preceding the Effective Date and (B)
the Executive's services shall be performed at the location where the Executive
was employed immediately preceding the Effective Date or any office or location
less than 35 miles from such location.

                (ii) During the Employment Period, and excluding any periods of
vacation and sick leave to which the Executive is entitled, the Executive agrees
to devote reasonable attention and time during normal business hours to the
business and affairs of the Company and, to the extent necessary to discharge
the responsibilities assigned to the Executive hereunder, to use the Executive's
reasonable best efforts to perform faithfully and efficiently such
responsibilities. During the Employment Period it shall not be a violation of
this Agreement for

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the Executive to (A) serve on corporate, civic or charitable boards or
committees, (B) deliver lectures, fulfill speaking engagements or teach at
educational institutions, and (C) manage personal investments, so long as such
activities do not significantly interfere with the performance of the
Executive's responsibilities as an employee of the Company in accordance with
this Agreement. It is expressly understood and agreed that to the extent that
any such activities have been conducted by the Executive prior to the Effective
Date, the continued conduct of such activities (or the conduct of activities
similar in nature and scope thereto) subsequent to the Effective Date shall not
thereafter be deemed to interfere with the performance of the Executive's
responsibilities to the Company.

            (b) COMPENSATION.

                (i) BASE SALARY. During the Employment Period, the Executive
shall receive an annual base salary ("Annual Base Salary"), which shall be paid
at a monthly rate, at least equal to twelve times the highest monthly base
salary paid or payable, including any base salary which has been earned but
deferred, to the Executive by the Company and its affiliated companies in
respect of the twelve-month period immediately preceding the month in which the
Effective Date occurs. During the Employment Period, the Annual Base Salary
shall be reviewed no more than 12 months after the last salary increase awarded
to the Executive prior to the Effective Date. Any increase in Annual Base Salary
shall not serve to limit or reduce any other obligation to the Executive under
this Agreement. Annual Base Salary shall not be reduced after any such increase
and the term Annual Base Salary as utilized in this Agreement shall refer to
Annual Base Salary as so increased. As used in this Agreement, the term
"affiliated companies" shall include any company controlled by, controlling or
under common control with the Company.

                (ii) ANNUAL BONUS. During the Employment Period, in addition to
Annual Base Salary, the Executive shall be entitled to receive such annual bonus
as may be determined by the Board of Directors, but in no event less than the
annual bonus paid or payable in respect of the full fiscal year immediately
preceding the Effective Date.

                (iii) INCENTIVE PLANS. During the Employment Period, the
Executive shall be entitled to participate in all incentive plans, practices,
policies and programs applicable generally to other peer Executives of the
Company and its affiliated companies, but in no event shall such plans,
practices, policies and programs provide the Executive with benefits which are
less favorable, in the aggregate, than the most favorable of such plans,
practices, policies and programs in effect for the Executive at any time during
the 120-day period immediately preceding the Effective Date or, if more
favorable to the Executive, those provided generally at any time after the
Effective Date to other peer executives of the Company and its affiliated
companies.

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                (iv) WELFARE BENEFIT, SAVINGS AND RETIREMENT PLANS. During the
Employment Period, the Executive and/or the Executive's family, as the case may
be, shall be eligible for participation in and shall receive all benefits under
welfare benefit, savings and retirement plans, practices, policies and programs
provided by the Company and its affiliated companies (including, without
limitation, medical, prescription, dental, disability, employee life, group
life, split-dollar life, accidental death and travel accident insurance plans
and programs) to the extent applicable generally to other peer executives of the
Company, but in no event shall such plans, practices, policies and programs
provide the Executive with benefits which are less favorable, in the aggregate,
than the most favorable of such plans, practices, policies and programs in
effect for the Executive at any time during the 120-day period immediately
preceding the Effective Date or, if more favorable to the Executive, those
provided generally at any time after the Effective Date to other peer executives
of the Company and its affiliated companies.

                (v) EXPENSES. During the Employment Period, the Executive shall
be entitled to receive reimbursement for all reasonable expenses incurred by the
Executive in accordance with the policies, practices and procedures of the
Company in effect immediately prior to the Effective Date.

                (vi) VACATION. During the Employment Period, the Executive shall
be entitled to paid vacation in accordance with the plans, policies, programs
and practices of the Company and its affiliated companies, but in no event shall
such plans, practices, policies and programs provide the Executive with benefits
which are less favorable, in the aggregate, than the most favorable of such
plans, practices, policies and programs in effect for the Executive at any time
during the 120-day period immediately preceding the Effective Date or, if more
favorable to the Executive, those provided generally at any time after the
Effective Date to other peer executives of the Company and its affiliated
companies.

         5. TERMINATION OF EMPLOYMENT.

            (a) DEATH OR DISABILITY. The Executive's employment shall terminate
automatically upon the Executive's death during the Employment Period. If the
Company determines in good faith that the Disability of the Executive has
occurred during the Employment Period (pursuant to the definition of Disability
set forth below), it may give to the Executive written notice in accordance with
Section 12(b) of this Agreement of its intention to terminate the Executive's
employment. In such event, the Executive's employment with the Company shall
terminate effective on the 30th day after receipt of such notice by the
Executive (the "Disability Effective Date"), provided that, within the 30 days
after such receipt, the Executive shall not have returned to full-time
performance of the Executive's duties. For purposes of this Agreement,
"Disability" shall mean the absence of the Executive from the Executive's duties
with the Company on a full-time basis for six (6) months as a result of
incapacity due to mental or physical illness which is determined to be total and
permanent by a physician selected by the

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Company or its insurers and acceptable to the Executive or the Executive's legal
representative.

            (b) CAUSE. Subject to Section 5(d), the Company may terminate the
Executive's employment during the Employment Period for Cause. For purposes of
this Agreement, "Cause" shall mean:

                (i) the willful failure of the Executive to perform
         substantially the Executive's duties with the Company (other than any
         such failure resulting from incapacity due to physical or mental
         illness), which failure is not cured within 30 days after a written
         demand for substantial performance is delivered to the Executive by the
         Board which specifically identifies the manner in which the Board
         believes that the Executive has not substantially performed the
         Executive's duties, or

                (ii) the willful engaging by the Executive in illegal conduct or
         gross misconduct which is materially and demonstrably injurious to the
         Company.

For purposes of this provision, no act or failure to act, on the part of the
Executive, shall be considered "willful" unless it is done, or omitted to be
done, by the Executive in bad faith or without reasonable belief that the
Executive's action or omission was in the best interests of the Company.

            (c) GOOD REASON. The Executive's employment may be terminated by the
Executive for Good Reason. For purposes of this Agreement, "Good Reason" shall
mean:

                (i) the assignment to the Executive of any duties
         inconsistent in any material respect with the Executive's position
         (including status, offices, titles and reporting requirements),
         authority, duties or responsibilities as contemplated by Section 4(a)
         of this Agreement, or any other action by the Company which results in
         a diminution in such position, authority, duties or responsibilities,
         excluding for this purpose an isolated, insubstantial and inadvertent
         action not taken in bad faith and which is remedied by the Company
         promptly after receipt of notice thereof given by the Executive;

                (ii) any failure by the Company to comply with any of the
         provisions of Section 4(b) of this Agreement or any other provision
         hereof requiring a payment or provision of a benefit to the Executive,
         other than an isolated, insubstantial and inadvertent failure not
         occurring in bad faith and which is remedied by the Company promptly
         after receipt of notice thereof given by the Executive;

                (iii) the Company's requiring the Executive to be based at any
         office or location other than as provided in Section 4(a)(i)(B) hereof
         or the Company's requiring the Executive to travel on Company business
         to a substantially greater extent than required immediately prior to
         the Effective Date;

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                (iv) any purported termination by the Company of the Executive's
         employment otherwise than as expressly permitted by this Agreement; or

                (v) any failure by the Company to comply with and satisfy
         Section 11(c) of this Agreement.

         (d) NOTICE OF TERMINATION.

             (i) Any termination by the Company for Cause, or by the Executive
for Good Reason, shall be effected by Notice of Termination to the other party
hereto given in accordance with Section 12(b) of this Agreement. For purposes of
this Agreement, a "Notice of Termination" means a written notice which (i)
indicates the specific termination provision in this Agreement relied upon, (ii)
to the extent applicable, sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Executive's
employment under the provision so indicated and (iii) if the Date of Termination
(as defined below) is other than the date of receipt of such notice, specifies
the termination date (which date shall be not more than thirty days after the
giving of such notice). The failure by the Executive or the Company to set forth
in the Notice of Termination any fact or circumstance which contributes to a
showing of Good Reason or Cause shall not waive any right of the Executive or
the Company, respectively, hereunder or preclude the Executive or the Company,
respectively, from asserting such fact or circumstances in enforcing the
Executive's or the Company's rights hereunder.

             (ii) Any Notice of Termination for Cause must be given within
ninety (90) days of the Board learning of the event(s) or circumstance(s) which
the Board believes constitute(s) Cause. Prior to any Notice of Termination for
Cause being given (and prior to any termination for Cause being effective), the
Executive shall be entitled to a hearing before the Board, or a committee
thereof, at which he may, at his election, be represented by counsel and at
which he shall have a reasonable opportunity to be heard. Such hearing shall be
held on not less than fifteen days prior written notice to the Executive stating
the Board's intention to terminate the Executive for Cause and stating in detail
the particular event(s) or circumstance(s) which the Board believes
constitute(s) Cause for termination.

         (e) DATE OF TERMINATION. "Date of Termination" means (i) if the
Executive's employment is terminated by the Company for Cause, or by the
Executive for Good Reason, the date of receipt of the Notice of Termination or
any later date specified therein, as the case may be, subject, in the case of
termination by the Company for Cause, to the Company's compliance with Section
5(d)(ii); (ii) if the Executive's employment is terminated by the Company other
than for Cause or Disability, the Date of Termination shall be the date on which
the Company notifies the Executive of such termination; and (iii) if the
Executive's employment is terminated by

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reason of death or Disability, the Date of Termination shall be the date of
death of the Executive or the Disability Effective Date, as the case may be.

         6. OBLIGATIONS OF THE COMPANY UPON TERMINATION.

            (a) GOOD REASON; OTHER THAN FOR CAUSE OR DISABILITY. If, during the
Employment Period, the Company shall terminate the Executive's employment other
than for Cause or Disability or the Executive shall terminate employment for
Good Reason:

                (i) the Company shall pay to the Executive in a lump sum in cash
         within 30 days after the Date of Termination the aggregate of the
         following amounts:

                    A. the sum of (1) the Executive's Annual Base Salary through
            the Date of Termination to the extent not theretofore paid, (2) the
            product of (x) the higher of (I) the highest annual cash bonus paid
            to the Executive in the last two fiscal years prior to the Effective
            Date (or if the Executive has not been employed by the Company in
            such prior fiscal year, then the Executive's annual target bonus for
            such fiscal year) and (II) the annual bonus paid or payable,
            including any bonus or portion thereof which has been earned but
            deferred (and annualized for any fiscal year consisting of less than
            twelve full months or during which the Executive was employed for
            less than twelve full months), for the most recently completed
            fiscal year during the Employment Period, if any (such higher amount
            being referred to as the "Highest Annual Bonus") and (y) a fraction,
            the numerator of which is the number of days in the current fiscal
            year through the Date of Termination, and the denominator of which
            is 365 and (3) any compensation previously deferred by the Executive
            (together with any accrued interest or earnings thereon) and any
            accrued vacation pay, in each case to the extent not theretofore
            paid (the sum of the amounts described in clauses (1), (2), and (3)
            shall be hereinafter referred to as the "Accrued Obligations"); and

                    B. the amount equal to the sum of (x) the Executive's Annual
            Base Salary and (y) the Highest Annual Bonus;

                (ii) for twelve (12) months after the Executive's Date of
         Termination, or such longer period as may be provided by the terms of
         the appropriate plan, program, practice or policy, the Company shall
         continue benefits to the Executive and/or the Executive's family at
         least equal to those which would have been provided to them in
         accordance with the plans, programs, practices and policies described
         in Section 4(b)(iv) of this Agreement (excluding any savings and/or
         retirement plans) if the Executive's employment had not been terminated
         or, if more favorable to the Executive, as in effect generally at any
         time thereafter with respect to other peer executives of the Company
         and its affiliated companies and their families, provided, however,
         that if the Executive becomes reemployed with another employer and is
         eligible to receive medical or other welfare benefits under another
         employer-provided plan, the medical and

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         other welfare benefits described herein shall be secondary to those
         provided under such other plan during such applicable period of
         eligibility. For purposes of determining eligibility (but not the time
         of commencement of benefits) of the Executive for retiree benefits
         pursuant to such plans, practices, programs and policies, the Executive
         shall be considered to have remained employed until twelve (12) months
         after the Date of Termination and to have retired on the last day of
         such period;

                (iii) to the extent not theretofore paid or provided, the
         Company shall timely pay or provide to the Executive any other amounts
         or benefits required to be paid or provided or which the Executive was
         as of the date of such termination eligible to receive under any plan,
         program, policy or practice or contract or agreement of the Company and
         its affiliated companies (such other amounts and benefits shall be
         hereinafter referred to as the "Other Benefits"); and

                (iv) outstanding options to purchase shares of Common Stock of
         the Company (or shares of capital stock for which such shares of Common
         Stock have been exchanged in a Business Combination) held by the
         Executive shall become immediately exercisable; PROVIDED, HOWEVER, that
         if, during the nine-month period subsequent to the date of this
         Agreement, (A) a Change of Control occurs as a result of a Business
         Combination and (B) the acquiring entity and the Company desire to
         account for such Business Combination as a "pooling-of-interests"
         business combination, as defined by Accounting Principles Board Opinion
         No. 16 (or its successor) and (C) the right to the acceleration of the
         exercisability of all outstanding unvested options to purchase Common
         Stock of the Company (or unvested shares of capital stock for which
         such shares of Common Stock have been exchanged in a Business
         Combination), as provided for in this Section 6(a)(iv), precludes the
         Business Combination to be accounted for as a pooling-of-interests
         business combination, as determined by the Company's Chief Financial
         Officer, then, the provisions of this Section 6(a)(iv) are revoked and
         shall have no force or effect.

            (b) DEATH. If the Executive's employment is terminated by reason of
the Executive's death during the Employment Period, this Agreement shall
terminate without further obligations to the Executive's legal representatives
under this Agreement, other than for payment of Accrued Obligations and the
timely payment or provision of Other Benefits. Accrued Obligations shall be paid
to the Executive's estate or beneficiary, as applicable, in a lump sum in cash
within 30 days of the Date of Termination.

            (c) DISABILITY. If the Executive's employment is terminated by
reason of the Executive's Disability during the Employment Period, this
Agreement shall terminate without further obligations to the Executive, other
than for payment of Accrued Obligations and the timely payment or provision of
Other Benefits. Accrued Obligations shall be paid to the Executive in a lump sum
in cash within 30 days of the Date of Termination.

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            (d) CAUSE OR OTHER THAN FOR GOOD REASON. If the Executive's
employment shall be terminated for Cause during the Employment Period, this
Agreement shall terminate without further obligations to the Executive other
than the obligation to pay to the Executive (x) his Annual Base Salary through
the Date of Termination, (y) the amount of any compensation previously deferred
by the Executive, and (z) Other Benefits, in each case to the extent theretofore
unpaid or not yet provided. If the Executive voluntarily terminates employment
during the Employment Period, excluding a termination for Good Reason, this
Agreement shall terminate without further obligations to the Executive, other
than for Accrued Obligations and the timely payment or provision of Other
Benefits. In such case, all Accrued Obligations shall be paid to the Executive
in a lump sum in cash within 30 days of the Date of Termination.

         7. NONEXCLUSIVITY OF RIGHTS. Nothing in this Agreement shall prevent or
limit the Executive's continuing or future participation in any plan, program,
policy or practice provided by the Company or any of its affiliated companies
and for which the Executive may qualify, nor, subject to Section 12(f), shall
anything herein limit or otherwise affect such rights as the Executive may have
under any contract or agreement with the Company or any of its affiliated
companies. Amounts which are vested benefits or which the Executive is otherwise
entitled to receive under any plan, policy, practice or program of or any
contract or agreement with the Company or any of its affiliated companies at or
subsequent to the Date of Termination shall be payable in accordance with such
plan, policy, practice or program or contract or agreement except as explicitly
modified by this Agreement.

         8. FULL SETTLEMENT; RELEASE OF CLAIMS. The Company's obligation to make
the payments provided for in this Agreement and otherwise to perform its
obligations hereunder shall not be affected by any set-off, counterclaim,
recoupment, defense or other claim, right or action which the Company may have
against the Executive (under this Agreement or otherwise) or others. In no event
shall the Executive be obligated to seek other employment or take any other
action by way of mitigation of the amounts payable to the Executive under any of
the provisions of this Agreement and such amounts shall not be reduced whether
or not the Executive obtains other employment. Except in such cases where the
Executive is found by a court of competent jurisdiction to have acted in bad
faith, the Company agrees to pay as incurred, to the full extent permitted by
law, all legal, accounting and other fees and expenses (including, without
limitation, of expert witnesses) which the Executive may reasonably incur (i) as
a result of any contest (regardless of the outcome thereof) by the Company, the
Executive or others of the validity or enforceability of, or liability under,
any provision of this Agreement or any guarantee of performance thereof
(including as a result of any contest by the Executive about the amount of any
payment pursuant to this Agreement), plus in each case interest on any delayed
payment at the applicable Federal rate provided for in Section 7872(f)(2)(A) of
the Internal Revenue Code of 1986, as amended (the "Code") and (ii) in
connection with the Executive's performance of his obligations under Section
9(c). Notwithstanding any other provision to the contrary herein, the Company
shall not be required to make any payments hereunder to the Executive unless and
until

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the Executive enters into a mutually satisfactory mutual release pursuant to
which the Company and Executive release such other (and their respective
affiliates) from all claims related to employment and the termination thereof.

         9. CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY.

            (a) Anything in this Agreement to the contrary notwithstanding and
except as set forth below, in the event it shall be determined that any payment
or distribution by the Company to or for the benefit of the Executive (whether
paid or payable or distributed or distributable pursuant to the terms of this
Agreement or otherwise, but determined without regard to any additional payments
required under this Section 9)(a "Payment") would be subject to the excise tax
imposed by Section 4999 of the Code or any interest or penalties are incurred by
the Executive with respect to such excise tax (such excise tax, together with
any such interest and penalties, are hereinafter collectively referred to as the
"Excise Tax"), then the Executive shall be entitled to receive an additional
payment (a "Gross-Up Payment") in an amount such that after payment by the
Executive of all taxes (including any interest or penalties imposed with respect
to such taxes), including, without limitation, any income taxes (and any
interest and penalties imposed with respect thereto) and Excise Tax imposed upon
the Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment
equal to the Excise Tax imposed upon the Payments. Notwithstanding the foregoing
provisions of this Section 9(a), if it shall be determined that the Executive is
entitled to a Gross-Up Payment, but that the Executive, after taking into
account the Payments and the Gross-Up Payment, would not receive a net after-tax
benefit of at least $50,000 (taking into account both income taxes and any
Excise Tax) as compared to the net after-tax proceeds to the Executive resulting
from an elimination of the Gross-Up Payment and a reduction of the Payments, in
the aggregate, to an amount (the "Reduced Amount") such that the receipt of
Payments would not give rise to any Excise Tax, then no Gross-Up Payment shall
be made to the Executive and the Payments, in the aggregate, shall be reduced to
the Reduced Amount.

            (b) Subject to the provisions of Section 9(c), all determinations
required to be made under this Section 9, including whether and when a Gross-Up
Payment is required and the amount of such Gross-Up Payment and the assumptions
to be utilized in arriving at such determination, shall be made by Arthur
Andersen LLP or such other certified public accounting firm as may be designated
by the Executive (the "Accounting Firm") which shall provide detailed supporting
calculations both to the Company and the Executive within 15 business days of
the receipt of notice from the Executive that there has been a Payment, or such
earlier time as is requested by the Company. In the event that the Accounting
Firm is serving as accountant or auditor for the individual, entity or group
effecting the Change of Control, the Executive shall appoint another nationally
recognized accounting firm to make the determinations required hereunder (which
accounting firm shall then be referred to as the Accounting Firm hereunder). All
fees and expenses of the Accounting Firm shall be borne solely by the Company.
Any

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Gross-Up Payment, as determined pursuant to this Section 9, shall be paid by the
Company to the Executive within five days of the receipt of the Accounting
Firm's determination. Any determination by the Accounting Firm shall be binding
upon the Company and the Executive. As a result of the uncertainty in the
application of Section 4999 of the Code at the time of the initial determination
by the Accounting Firm hereunder, it is possible that Gross-Up Payments which
will not have been made by the Company should have been made ("Underpayment"),
consistent with the calculations required to be made hereunder. In the event
that the Company exhausts its remedies pursuant to Section 9(c) and the
Executive thereafter is required to make a payment of any Excise Tax, the
Accounting Firm shall determine the amount of the Underpayment that has occurred
and any such Underpayment shall be promptly paid by the Company to or for the
benefit of the Executive.

            (c) The Executive shall notify the Company in writing of any claim
by the Internal Revenue Service that, if successful, would require the payment
by the Company of the Gross-Up Payment. Such notification shall be given as soon
as practicable but no later than ten business days after the Executive is
informed in writing of such claim and shall apprise the Company of the nature of
such claim and the date on which such claim is requested to be paid. The
Executive shall not pay such claim prior to the expiration of the 30-day period
following the date on which it gives such notice to the Company (or such shorter
period ending on the date that any payment of taxes with respect to such claim
is due). If the Company notifies the Executive in writing prior to the
expiration of such period that it desires to contest such claim, the Executive
shall:

                (i) give the Company any information reasonably requested by the
         Company and available to the Executive relating to such claim,

                (ii) take such action in connection with contesting such claim
         as the Company shall reasonably request in writing from time to time,
         including, without limitation, accepting legal representation with
         respect to such claim by an attorney reasonably selected by the
         Company,

                (iii) cooperate with the Company in good faith in order
         effectively to contest such claim, and

                (iv) permit the Company to participate in any proceedings
         relating to such claim;

provided, however, that the Company shall bear and pay directly all costs and
expenses (including additional interest and penalties) incurred in connection
with such contest and shall indemnify and hold the Executive harmless, on an
after-tax basis, for any Excise Tax or income tax (including interest and
penalties with respect thereto) imposed as a result of such

                                      -12-
<PAGE>

representation and payment of costs and expenses. Without limitation on the
foregoing provisions of this Section 9(c), the Company shall control all
proceedings taken in connection with such contest and, at its sole option, may
pursue or forgo any and all administrative appeals, proceedings, hearings and
conferences with the taxing authority in respect of such claim and may, at its
sole option, either direct the Executive to pay the tax claimed and sue for a
refund or to contest the claim in any permissible manner, and the Executive
agrees to prosecute such contest to a determination before any administrative
tribunal, in a court of initial jurisdiction and in one or more appellate
courts, as the Company shall determine; provided, however, that if the Company
directs the Executive to pay such claim and sue for a refund, the Company shall
advance the amount of such payment to the Executive, on an interest-free basis
and shall indemnify and hold the Executive harmless, on an after-tax basis, from
any Excise Tax or income tax (including interest or penalties with respect
thereto) imposed with respect to such advance or with respect to any imputed
income with respect to such advance; and further provided that any extension of
the statute of limitations relating to payment of taxes for the taxable year of
the Executive with respect to which such contested amount is claimed to be due
is limited solely to such contested amount. Furthermore, the Company's control
of the contest shall be limited to issues with respect to which a Gross-Up
Payment would be payable hereunder and the Executive shall be entitled to settle
or contest, as the case may be, any other issue raised by the Internal Revenue
Service or other taxing authority.

            (d) If, after the receipt by the Executive of an amount advanced by
the Company pursuant to Section 9(c), the Executive becomes entitled to receive
any refund with respect to such claim, the Executive shall (subject to the
Company's complying with the requirements of Section 9(c)) promptly pay to the
Company the amount of such refund (together with any interest paid or credited
thereon after taxes applicable thereto). If, after the receipt by the Executive
of an amount advanced by the Company pursuant to Section 9(c), a determination
is made that the Executive shall not be entitled to any refund with respect to
such claim and the Company does not notify the Executive in writing of its
intent to contest such denial of refund prior to the expiration of 30 days after
such determination, then such advance shall be forgiven and shall not be
required to be repaid and the amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be paid.

         10. CONFIDENTIAL INFORMATION. The Executive shall hold in a fiduciary
capacity for the benefit of the Company all secret or confidential information,
knowledge or data relating to the Company or any of its affiliated companies,
and their respective businesses, which shall have been obtained by the Executive
during the Executive's employment by the Company or any of its affiliated
companies and which shall not be or become public knowledge (other than by acts
by the Executive or representatives of the Executive in violation of this
Agreement). After termination of the Executive's employment with the Company,
the Executive shall not, without the prior written consent of the Company or as
may otherwise be required by law or legal process, communicate or divulge any
such information, knowledge or data to anyone other than

                                      -13-
<PAGE>

the Company and those designated by it. In no event shall an asserted violation
of the provisions of this Section 10 constitute a basis for deferring or
withholding any amounts or benefits otherwise payable or to be provided to the
Executive under this Agreement.

         11. SUCCESSORS.

            (a) This Agreement is personal to the Executive and without the
prior written consent of the Company shall not be assignable by the Executive
otherwise than by will or the laws of descent and distribution. This Agreement
shall inure to the benefit of and be enforceable by the Executive's legal
representatives.

            (b) This Agreement shall inure to the benefit of and be binding upon
the Company and its successors and assigns.

            (c) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to assume
expressly and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place. As used in this Agreement, "Company" shall mean the Company as
hereinbefore defined and any successor to its business and/or assets as
aforesaid.

         12. MISCELLANEOUS.

            (a) This Agreement shall be governed by and construed in accordance
with the laws of the State of Delaware, without reference to principles of
conflict of laws. The captions of this Agreement are not part of the provisions
hereof and shall have no force or effect. This Agreement may not be amended or
modified otherwise than by a written agreement executed by the parties hereto or
their respective successors and legal representatives.

            (b) All notices and other communications hereunder shall be in
writing and shall be given by hand delivery to the other party or by registered
or certified mail, return receipt requested, postage prepaid, addressed as
follows:

                  IF TO THE EXECUTIVE:

                  Name of Executive
                  c/o Open Market, Inc.
                  One Wayside Road
                  Burlington MA 01803

                                      -14-
<PAGE>

                  IF TO THE COMPANY:

                  Open Market, Inc.
                  One Wayside Road
                  Burlington, MA 01803
                  Attention: Chairman of Compensation Committee

or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.

            (c) The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement.

            (d) The Company may withhold from any amounts payable under this
Agreement such Federal, state, local or foreign taxes as shall be required to be
withheld pursuant to any applicable law or regulation.

            (e) The Executive's or the Company's failure to insist upon strict
compliance with any provision of this Agreement or the failure to assert any
right the Executive or the Company may have hereunder, including, without
limitation the right of the Executive to terminate employment for Good Reason
pursuant to Section 5(c) of this Agreement, shall not be deemed to be a waiver
of such provision or right or any other provision or right of this Agreement.

            (f) The Executive and the Company acknowledge that, except as may
otherwise be provided under any other written agreement between the Executive
and the Company, the employment of the Executive by the Company as well as the
Executive's status as a Corporate Officer is "at will" and, subject to Section
1(a) hereof, prior to the Effective Date, the Executive's employment, the
Executive's status as a Corporate Officer and/or this Agreement may be
terminated by either the Executive or the Company, by written notice to the
other, at any time prior to the Effective Date, in which case the Executive
shall have no further rights or obligations under this Agreement. From and after
the Effective Date this Agreement shall supersede any other agreement between
the parties with respect to the subject matter hereof.

            (g) Any dispute or controversy arising under or in connection with
this Agreement shall be settled exclusively by arbitration, conducted before a
panel of three arbitrators in Boston, Massachusetts, in accordance with the
rules of the American Arbitration Association then in effect. Judgment may be
entered on the arbitrator's award in any court of competent jurisdiction.

                                      -15-
<PAGE>

         IN WITNESS WHEREOF, the Executive has hereunto set the Executive's hand
and, pursuant to the authorization from its Board of Directors, the Company has
caused these presents to be executed in its name on its behalf, all as of the
day and year first above written.

                                             /s/ Ed Durkin
                                             ----------------------------------
                                             Ed Durkin

                                             Open Market, Inc.

                                             By: /s/ Harland Lavigne
                                                 ------------------------------
                                             Harland LaVigne
                                             Its: Chief Executive Officer

                                      -16-<PAGE>

                                 LOAN AGREEMENT

                           Dated as of August 31, 2000

            NATURADE, INC., a Delaware corporation (the "Borrower"), on the one
hand, and HEALTH HOLDINGS AND BOTANICALS, LLC, a California limited liability
company ("HH"), and WALD HOLDINGS, LLC, a Missouri limited liability company
("Wald") (HH and Wald are from time to time collectively referred to as the
"Lender Group" and individually as a "Lender"), hereby agree as of the Effective
Date (defined in Section 7.12 below) as follows:

      1.    AMOUNTS AND TERMS OF THE ADVANCES.

            1.1 THE ADVANCES. The Lender Group agrees, on the terms and
conditions hereinafter set forth, to consider making advances (the "Advances")
to the Borrower from time to time on any day of the year on which banks are not
required or authorized to close in San Francisco (a "Business Day") during the
period from the date hereof until the third anniversary of the date of the
initial Advance hereunder (such date, or the earlier date of termination of the
Commitment (as defined below) pursuant to Section 3.1, being the "Termination
Date") in an aggregate principal amount not to exceed One Million Two Hundred
Thousand United States Dollars ($1,200,000.00) (the "Commitment"). Each Advance
shall be in an amount not less than Two Hundred Thousand United States Dollars
($200,000) or an integral multiple thereof, EXCEPT that an Advance may be in an
amount equal to the entire unused Commitment. Anything to the contrary appearing
herein notwithstanding, amounts borrowed and repaid or prepaid hereunder may not
be reborrowed.

            1.2   MAKING THE ADVANCES.

                  (a) Each Advance shall be made on notice, given not later than
      11:00 A.M. (San Francisco time) on the third Business Day prior to the
      date of the proposed Advance, by the Borrower to the Lender Group,
      specifying the date and amount thereof (including the amounts requested to
      be made by each Lender). Upon Lender Group's receipt of such notice,
      Lender Group may determine in its sole and complete discretion to make or
      not to make such requested Advance (and in the event Lender Group
      determines to make such Advance, the amount of Advances by each Lender).
      Lender Group shall notify Borrower whether Lender Group will make such
      Advance within two Business Days of Lender Group's receipt of notice
      requesting such Advance; provided,

                                       -1-
<PAGE>

      that if Lender Group shall not notify Borrower of Lender Group's agreement
      to make such Advance within such period, the Lender Group shall be deemed
      to have notified Borrower that Lender Group will not make such Advance,
      and no further notice of Lender Group shall be required hereunder. If
      Lender Group shall notify Borrower of Lender Group's agreement to make
      such Advance requested by Borrower and upon fulfillment of the applicable
      conditions set forth in Section 2, Lender Group will make such Advance
      available to the Borrower in same day funds by wire transfer to the
      Borrower's account for wire transfers.

                  (b) Each Advance made by a Lender shall be deemed to be made
      by such Lender severally (and not jointly with other members of the Lender
      Group) and shall be evidenced by a promissory note in favor of each such
      member substantially in the form of EXHIBIT A hereto (each, a "Note"). All
      other rights and obligations of "Lender Group" hereunder shall be deemed
      to apply to each Lender severally (and not jointly) and all references to
      "Lender Group" in this Agreement shall be so interpreted and construed.

                  (c) Each notice from the Borrower to the Lender Group
      requesting an Advance shall be irrevocable and binding on the Borrower.
      The Borrower shall indemnify the Lender Group against any loss, cost or
      expense incurred by the Lender Group as a result of any failure to fulfill
      on or before the date specified in such notice for such Advance the
      applicable conditions set forth in Section 2, including, without
      limitation, any loss, cost or expense incurred by reason of the
      liquidation or reemployment of funds acquired by the Lender Group to fund
      the Advance when the Advance, as a result of such failure, is not made on
      such date.

            1.3 REPAYMENT. The Borrower shall repay the aggregate unpaid
principal amount of all Advances, together with all amounts of interest then
accrued thereon, by no later than the Termination Date.

            1.4 INTEREST. On the last Business Day of each calendar quarter
beginning after the date hereof, Borrower shall pay to Lender Group all amounts
of interest then accrued and unpaid with respect to the Advances as provided
below. The Borrower shall pay interest on the unpaid principal amount of each
Advance from the date of such Advance until such principal amount shall be paid
in full, at the rate of eight percent (8%) per annum; PROVIDED that any amount
of principal which is not paid when due (whether at stated maturity, by
acceleration or otherwise) shall bear interest, from the date on which such
amount is due until such amount is paid in full,

                                       -2-
<PAGE>

payable on demand, at a rate per annum equal at all times to eleven percent
(11%) per annum.

            1.5 PREPAYMENTS. The Borrower may, upon at least thirty (30)
calendar days' notice to the Lender Group stating the proposed date and
principal amount of the prepayment, and if such notice is given the Borrower
shall, prepay the outstanding principal amounts of the Advances in whole or in
part, together with accrued interest to the date of such prepayment on the
principal amount prepaid; PROVIDED, HOWEVER, that each partial prepayment shall
be in an aggregate principal amount not less than One Hundred Thousand United
States Dollars ($100,000).

            1.6   PAYMENTS AND COMPUTATIONS.

                  (a) The Borrower shall make each payment hereunder not later
      than 11:00 a.m. (San Francisco time) on the day when due in U.S. dollars
      to each Lender at its address referred to in Section 7.2 in same day
      funds.

                  (b) All computations of interest shall be made by the Lender
      Group on the basis of a year of 365 or 366 days, as the case may be, in
      each case for the actual number of days (including the first day but
      excluding the last day) occurring in the period for which such interest is
      payable. Each determination by the Lender Group of any amount of interest
      payable hereunder shall be conclusive and binding for all purposes, absent
      manifest error.

                  (c) Whenever any payment hereunder shall be stated to be due
      on a day other than a Business Day, such payment shall be made on the next
      succeeding Business Day, and such extension of time shall in such case be
      included in the computation of payment of interest.

            1.7 GRANT OF SECURITY. The Borrower hereby assigns and pledges to
the Lender Group, and hereby grants to HH, as collateral agent for the Lender
Group (the "Collateral Agent"), a security interest in, the following
(collectively, the "Collateral"):

                  (a) all of the Borrower's right, title and interest, whether
      now owned or hereafter acquired, in and to all equipment in all of its
      forms, wherever located, now or hereafter existing, all fixtures and all
      parts thereof and all accessions thereto (any and all such equipment,
      fixtures, parts and accessions being the "Equipment");

                                       -3-
<PAGE>

                  (b) all of the Borrower's right, title and interest, whether
      now owned or hereafter acquired, in and to all inventory in all of its
      forms, wherever located, now or hereafter existing (including, but not
      limited to, (i) all raw materials and work in process therefor, finished
      goods thereof and materials used or consumed in the manufacture or
      production thereof, (ii) goods in which the Borrower has an interest in
      mass or a joint or other interest or right of any kind (including, without
      limitation, goods in which the Borrower has an interest or right as
      consignee) and (iii) goods that are returned to or repossessed by the
      Borrower), and all accessions thereto and products thereof and documents
      therefor (any and all such inventory, accessions, products and documents
      being the "Inventory");

                  (c) all of the Borrower's right, title and interest, whether
      now owned or hereafter acquired, in and to all accounts, contract rights,
      chattel paper, instruments, deposit accounts, general intangibles and
      other obligations of any kind, now or hereafter existing, whether or not
      arising out of or in connection with the sale or lease of goods or the
      rendering of services, and all rights now or hereafter existing in and to
      all security agreements, leases and other contracts securing or otherwise
      relating to any such accounts, contract rights, chattel paper,
      instruments, deposit accounts, general intangibles or obligations (any and
      all such accounts, contract rights, chattel paper, instruments, deposit
      accounts, general intangibles and obligations, to the extent not referred
      to in clause (d), (e) or (f) below, being the "Receivables", and any and
      all such leases, security agreements and other contracts being the
      "Related Contracts");

                  (d) all of the Borrower's right, title and interest in and to
      each of the agreements to which the Borrower is now or may hereafter
      become a party, in each case as such agreements may be amended or
      otherwise modified from time to time (collectively, the "Assigned
      Agreements"), including, without limitation, (i) all rights of the
      Borrower to receive moneys due and to become due under or pursuant to the
      Assigned Agreements, (ii) all rights of the Borrower to receive proceeds
      of any insurance, indemnity, warranty or guaranty with respect to the
      Assigned Agreements, (iii) claims of the Borrower for damages arising out
      of or for breach of or default under the Assigned Agreements and (iv) the
      right of the Borrower to terminate the Assigned Agreements, to perform
      thereunder and to compel performance and otherwise exercise all remedies
      thereunder (all such Collateral being the "Agreement Collateral");

                                       -4-
<PAGE>

                  (e) all of the following (collectively, the "Account
      Collateral"): (i) all deposit accounts of the Borrower, all funds held
      therein and all certificates and instruments, if any, from time to time
      representing or evidencing such deposit accounts; (ii) all notes,
      certificates of deposit, deposit accounts, checks and other instruments
      from time to time hereafter delivered to or otherwise possessed by the
      Lender Group for or on behalf of the Borrower in substitution for or in
      addition to any or all of the then existing Account Collateral; and (iii)
      all interest, dividends, cash, instruments and other property from time to
      time received, receivable or otherwise distributed in respect of or in
      exchange for any or all of the then existing Account Collateral; and

                  (f) all proceeds of any and all of the foregoing Collateral
      (including, without limitation, proceeds that constitute property of the
      types described in clauses (a) - (e) of this Section 1.7) and, to the
      extent not otherwise included, all (i) payments under insurance (whether
      or not the Lender Group is the loss payee thereof), or any indemnity,
      warranty or guaranty, payable by reason of any loss or damage to or
      otherwise with respect to any of the foregoing Collateral and (ii) cash.

            1.8   COLLATERAL AGENCY AND INTERCREDITOR PROVISIONS.

                  (a) "Required Combined Lenders" means at any time Lenders
      whose Pro Rata Shares aggregate more than fifty percent (50%), as such
      percentage is determined under the definition of Pro Rata Share set forth
      below.

                  (b) "Pro Rata Share" means at any time, with respect to a
      Lender, a fraction (expressed as a percentage), the numerator of which is
      the aggregate outstanding principal amount of Advances then owing to such
      Lender and the denominator of which is the aggregate outstanding principal
      amount of Advances then owing to the Lender Group.

                  (c) Each of the Lenders hereby irrevocably appoints and
      authorizes HH to act as Collateral Agent, and HH agrees to act as
      Collateral Agent for such Lenders, pursuant to the terms of this
      Agreement.

                  (d) Each of the Lenders agrees that no Lender shall have any
      independent right of action against the Collateral or any part thereof
      under the Notes or this Agreement, and that the rights and remedies of the
      Collateral Agent hereunder shall only be exercised at the direction of the
      Required

                                       -5-
<PAGE>

      Combined Lenders (notwithstanding the occurrence of any Event of Default
      hereunder or acceleration of the obligations hereunder or under any Note).
      The Collateral Agent hereby agrees (and each Lender acknowledges such
      agreement) that it shall not enforce the security interests of any
      individual Lender in the Collateral without the direction and consent of
      the Required Combined Lenders. Notwithstanding the foregoing, but subject
      to any subordination agreement to which a Lender may be a party, a Lender
      shall have an independent right of action against the Collateral (and the
      Collateral Agent shall take such actions as may be necessary to effectuate
      such independent right of action) in the event that the Borrower has
      failed to make interest payments on any Advance to such Lender in an
      amount equal to or exceeding the equivalent of 12 months' interest on such
      Advance.

                  (e) Each of the Lenders agrees that no Lender shall bring any
      action against, or make any demand upon, the Borrower under any Note or
      this Agreement without the prior written consent of the Required Combined
      Lenders.

                  (f) Upon its receipt of any proceeds of the Collateral, the
      Collateral Agent shall disburse such proceeds as follows:

                              (i) First, to the costs and expenses of the
                    Collateral Agent incurred in connection with the enforcement
                    of this Agreement;

                              (ii) Second, to the Lenders ratably in accordance
                    with their Pro Rata Shares until the obligations under the
                    Notes are satisfied; and

                              (iii) Finally, to the person or persons otherwise
                    legally entitled thereto.

                  (g) Each Lender shall promptly put in the custody, possession
      or control of the Collateral Agent for disposition or distribution in
      accordance with the provisions of this Section any Collateral, or proceeds
      therefrom, over which such Lender obtains custody, control or possession.
      Until such time as each Lender shall have complied with the provisions of
      the immediately preceding sentence, such Lender shall be deemed to hold
      such Collateral or proceeds in trust for the Lender Group.

                  (h) Nothing contained herein shall limit or restrict the

                                       -6-
<PAGE>

      independent right of any Lender to initiate an action or actions in any
      proceeding under the Bankruptcy Code of the United States of America, as
      amended from time to time, and all other applicable liquidation,
      conservatorship, bankruptcy, moratorium, rearrangement, receivership,
      insolvency, reorganization, or similar debtor relief laws from time to
      time in effect affecting the rights of creditors generally ("Debtor Relief
      Laws"), and to appear or be heard on any matter before the bankruptcy or
      other applicable court in any such proceeding. The Collateral Agent is not
      entitled to initiate such actions on behalf of any Lender or to appear and
      be heard on any matter before the bankruptcy or other applicable court in
      any such proceeding as the representative of any Lender, unless such
      action or appearance has been approved in writing by such Lender. The
      Collateral Agent is not authorized in any such proceeding to enter into
      any agreement for, or give any authorization or consent with respect to,
      the postpetition usage of Collateral, unless such agreement, authorization
      or consent has been approved in writing by the Required Combined Lenders.
      This Agreement shall survive the commencement of any proceeding under a
      Debtor Relief Law.

                  (i) Each of the Lenders waives any right it may now or
      hereafter have to require the Collateral Agent to marshal assets, to
      exercise rights or remedies in a particular manner, or to forbear
      exercising such rights and remedies in any particular manner or order.

            1.9 SECURITY FOR OBLIGATIONS. This Agreement secures the repayment
of all obligations of the Borrower now or hereafter existing under this
Agreement and any other document or instrument delivered in connection herewith,
whether for principal, interest, fees, expenses or otherwise (all such
obligations being the "Secured Obligations"). Without limiting the generality of
the foregoing, this Agreement secures the payment of all amounts that constitute
part of the Secured Obligations and would be owed by the Borrower to the Lender
Group but for the fact that they are unenforceable or not allowable due to the
existence of a bankruptcy, reorganization or similar proceeding involving the
Borrower.

            1.10 BORROWER REMAINS LIABLE. Anything herein to the contrary
notwithstanding, (a) the Borrower shall remain liable under the contracts and
agreements included in the Collateral to the extent set forth therein to perform
all of its duties and obligations thereunder to the same extent as if this
Agreement had not been executed, (b) the exercise by the Lender Group of any of
the rights hereunder shall not release the Borrower from any of its duties or
obligations under the contracts and agreements included in the Collateral and
(c) the Lender Group shall have no

                                       -7-
<PAGE>

obligation or liability under the contracts and agreements included in the
Collateral by reason of this Agreement, nor shall the Lender Group be obligated
to perform any of the obligations or duties of the Borrower thereunder or to
take any action to collect or enforce any claim for payment assigned hereunder.

            1.11  FURTHER ASSURANCES.

                  (a) The Borrower agrees that from time to time, at the expense
      of the Borrower, the Borrower will promptly execute and deliver all
      further instruments and documents, and take all further action, that may
      be necessary or desirable, or that the Collateral Agent, on behalf of the
      Lender Group, may reasonably request, in order to perfect and protect any
      pledge, assignment or security interest granted or purported to be granted
      hereby or to enable the Collateral Agent on behalf of the Lender Group to
      exercise and enforce its rights and remedies hereunder with respect to any
      Collateral.

                  (b) The Borrower hereby authorizes the Collateral Agent, on
      behalf of the Lender Group, to file one or more financing or continuation
      statements, and amendments thereto, relating to all or any part of the
      Collateral without the signature of the Borrower where permitted by law.
      Photocopy or other reproduction of this Agreement or any financing
      statement covering the Collateral or any part thereof shall be sufficient
      as a financing statement where permitted by law.

                  (c) The Borrower will furnish to the Collateral Agent from
      time to time statements and schedules further identifying and describing
      the Collateral and such other reports in connection with the Collateral as
      the Collateral Agent may reasonably request, all in reasonable detail.

            1.12  AS TO EQUIPMENT AND INVENTORY.

                  (a) The Borrower shall keep the Equipment and Inventory (other
      than Inventory sold in the ordinary course of business) at the Borrower's
      property at 14370 Myford Road, Irvine, California.

                  (b) The Borrower shall cause the Equipment to be maintained
      and preserved in the same condition, repair and working order as when new,
      ordinary wear and tear excepted, and in accordance with any manufacturer's
      manual, and shall forthwith, or in the case of any material loss or damage
      to any of the Equipment as quickly as practicable after the occurrence
      thereof, make or

                                       -8-
<PAGE>

      cause to be made all repairs, replacements and other improvements in
      connection therewith that are necessary or desirable to such end. The
      Borrower shall promptly furnish to the Collateral Agent a statement
      respecting any material loss or damage to any of the Equipment.

                  (c) The Borrower shall pay promptly when due all property and
      other taxes, assessments and governmental charges or levies imposed upon,
      and all claims (including claims for labor, materials and supplies)
      against, the Equipment and Inventory. In producing the Inventory, the
      Borrower shall comply with all requirements of the Fair Labor Standards
      Act.

            1.13 INSURANCE. The Borrower shall, at its own expense, maintain
insurance with respect to the Equipment and Inventory in such amounts, against
such risks, in such form and with such insurers, as shall be reasonably
satisfactory to the Collateral Agent from time to time. Further, the Borrower
shall, at the request of the Collateral Agent, duly exercise and deliver
instruments of assignment of such insurance policies to comply with the
requirements of this Agreement and cause the insurers to acknowledge notice of
such assignment.

            1.14 THE COLLATERAL AGENT'S DUTIES. The powers conferred on the
Collateral Agent hereunder are solely to protect its and the Lender Group's
interest in the Collateral and shall not impose any duty upon it to exercise any
such powers. Except for the safe custody of any Collateral in its possession and
the accounting for moneys actually received by it hereunder, the Collateral
Agent shall have no duty as to any Collateral, or as to the taking of any
necessary steps to preserve rights against any parties or any other rights
pertaining to any Collateral.

            1.15 CONTINUING SECURITY INTEREST. This Agreement shall create a
continuing security interest in the Collateral and shall (a) remain in full
force and effect until the later of the indefeasible cash payment in full of the
Secured Obligations and the Termination Date, (b) be binding upon the Borrower,
its successors and assigns and (c) inure, together with the rights and remedies
of the Collateral Agent on behalf of the Lender Group hereunder, to the benefit
of the Collateral Agent and the Lender Group, and their respective successors,
transferees and assigns.

            1.16 RELEASE AND TERMINATION. Upon the later of indefeasible cash
payment in full of the Secured Obligations and the Termination Date, the pledge,
assignment and security interest granted hereby shall terminate and all rights
to the Collateral shall revert to the Borrower. Upon any such termination, the
Collateral Agent and the Lender Group will, at the Borrower's expense, execute
and deliver to the

                                       -9-
<PAGE>

Borrower such documents as the Borrower shall reasonably request to evidence
such termination.

      2.    CONDITIONS OF LENDING.

            2.1 CONDITION PRECEDENT TO INITIAL ADVANCE. The Lender Group shall
have no obligation to make any Advance hereunder until such time (if any) as
Lender Group has notified Borrower of Lender Group's agreement, in Lender
Group's sole and complete discretion, to make a requested Advance as provided in
Section 1 above. Upon Lender Group's agreement (if any) to make the initial
Advance, unless waived by Lender Group, the obligation of the Lender Group to
make such initial Advance is subject to the further condition precedent that the
Lender Group shall have received on or before the day of such Advance such
documents as the Lender Group shall reasonably request.

            2.2 CONDITIONS PRECEDENT TO ALL ADVANCES. The Lender Group shall
have no obligation to make any Advance hereunder until such time (if any) as
Lender Group has notified Borrower of Lender Group's agreement, in Lender
Group's sole and complete discretion, to make a requested Advance as provided in
Section 1 above. Upon Lender Group's agreement (if any) to make an Advance
(including the initial Advance), Lender Group's obligation to make such Advance
shall be subject to the further condition precedent that on the date of such
Advance no event has occurred and is continuing, or would result from such
Advance or from the use of the proceeds thereof, which constitutes an Event of
Default (as defined in Section 3.1 hereof) or would constitute an Event of
Default but for the requirement that notice be given or time elapse or both.

      3.    EVENTS OF DEFAULT.

            3.1 EVENTS OF DEFAULT. If any of the following events ("Events of
Default") shall occur and be continuing:

                    (a) The Borrower shall fail to pay any principal of, or
          interest on, any Advance when the same becomes due and payable; or

                    (b) The Borrower shall fail to perform or observe any
          material term, covenant or agreement contained in this Agreement
          (other than those specified in Section 3.1(a)) on its part to be
          performed or observed if such failure shall remain unremedied for 10
          days after written notice thereof shall have been given to the
          Borrower by the Collateral Agent; or

                                       -10-
<PAGE>

                    (c) The Borrower shall generally not pay its debts as such
          debts become due, or shall admit in writing its inability to pay its
          debts generally, or shall make a general assignment for the benefit of
          creditors; or any proceeding shall be instituted by or against the
          Borrower seeking to adjudicate it a bankrupt or insolvent, or seeking
          liquidation, winding up, reorganization, arrangement, adjustment,
          protection, relief, or composition of it or its debts under any law
          relating to bankruptcy, insolvency or reorganization or relief of
          debtors, or seeking the entry of an order for relief or the
          appointment of a receiver, trustee, custodian or other similar
          official for it or for any substantial part of its property and, in
          the case of any such proceeding instituted against it (but not
          instituted by it), either such proceeding shall remain undismissed or
          unstayed for a period of 30 days, or any of the actions sought in such
          proceeding (including, without limitation, the entry of an order for
          relief against, or the appointment of a receiver, trustee, custodian
          or other similar official for, it or for any substantial part of its
          property) shall occur; or the Borrower shall take any corporate action
          to authorize any of the actions set forth above in this subsection
          (c).

            THEN, in any such event, the Lender Group upon written approval of
Required Combined Lenders, (i) may, by notice to the Borrower, declare its
obligation to make Advances to be terminated, whereupon the same shall forthwith
terminate, and (ii) may, by notice to the Borrower, declare the Advances, all
interest thereon and all other amounts payable under this Agreement to be
forthwith due and payable, whereupon the Advances, all such interest and all
such amounts shall become and be forthwith due and payable, without presentment,
demand, protest, or further notice of any kind, all of which are hereby
expressly waived by the Borrower; provided, however, that in the event of an
actual or deemed entry of an order for relief with respect to the Borrower under
the Federal Bankruptcy Code, (A) the obligation of the Lender Group to make
Advances shall automatically be terminated and (B) the Advances and all such
interest and all such amounts shall automatically become and be due and payable,
without presentment, demand, protest or any notice of any kind, all of which are
hereby expressly waived by the Borrower.

      4. LENDER GROUP'S RIGHT TO CONVERT. Without limitation to any other right
or remedy Lender Group may have under this Agreement, applicable law, or
otherwise, any Lender may, at any time by notice to the Borrower in accordance
with Section 7.2, convert all or any part of the Advances into shares of common
stock of the Borrower ("Shares") at a conversion price equal to the lower of (i)
the average closing bid of Borrower's common stock for the ten trading days
prior to the making of an

                                       -11-
<PAGE>

Advance, or (ii) the average closing bid of Borrower's common stock for the ten
trading days prior to the date of receipt of notice of conversion. Upon
Borrower's receipt of such notice, Borrower shall immediately cause to be issued
shares of common stock to such Lender as provided in such notice. Upon such
issuance the amount of the Secured Obligations shall be reduced by the amount
applied to such conversion.

      5.    REPRESENTATIONS BY LENDER GROUP.

                  (a) Each Lender (i) is a sophisticated investor with knowledge
      and experience in business and financial matters, (ii) has received
      certain information concerning the Borrower and has had the opportunity to
      obtain additional information as desired in order to evaluate the merits
      and risks inherent in the Shares, (iii) is able to bear the economic risk
      in the Shares, and (iv) is an accredited investor as defined under Rule
      501 of the 1933 Act.

                  (b) By accepting Shares, the Lender Group acknowledges that
      such Shares shall be acquired for investment and not for distribution, as
      that term is used in the 1933 Act, unless in the opinion of legal counsel
      to the Borrower such distribution is in compliance with or exempt from the
      registration requirements of the 1933 Act, and the Lender Group further
      acknowledges and understands that the Shares may have to be held
      indefinitely unless they have been or are subsequently registered under
      the 1933 Act or an exemption from such registration is available; the
      Lender Group understands that the certificates evidencing such Shares will
      be imprinted with a legend substantially as follows:

                  "The shares represented by this certificate have not been
                  registered under the Securities Act of 1933, as amended (the
                  "Act"). These shares have been acquired for investment and not
                  with a view to distribution or resale, and may not be sold,
                  mortgaged, pledged, hypothecated or otherwise transferred
                  without an effective registration statement for such shares
                  under the Act, or unless an exemption from registration is
                  available with respect to any proposed sale or transfer."

                  (c) The Lender Group acknowledges and understands that the
      Lender Group may have to bear the economic risk associated with the
      purchase

                                       -12-
<PAGE>

      of the Shares for an indefinite period of time because the Shares have not
      been registered under the 1933 Act and, therefore, cannot be sold unless
      they are so registered or an exemption from registration is available with
      respect to any proposed sale or transfer.

                  (d) NO RIGHTS AS SHAREHOLDERS. Neither the Lender Group nor
      any transferee thereof shall be, or have any rights or privileges of, a
      shareholders of the Borrower concerning the Shares unless, until and to
      the extent the Advances have been converted in accordance with this
      Agreement.

      6. CERTAIN CORPORATE TRANSACTIONS. Nothing in this Agreement shall in any
way prohibit the Borrower from merging with or consolidating into another
corporation, or from selling or transferring all or substantially all of its
assets, or from distributing all or substantially all of its assets to its
shareholders in liquidation, or from dissolving and terminating its corporate
existence. In the event the Borrower merges or consolidates with another
corporation, or all or substantially all of the Borrower's capital stock or
assets are acquired by or are subject to a tender offer of another corporation,
entity or person (collectively, together with each event described in the
immediately preceding sentence, "Control Events"), and the surviving or
acquiring corporation, person or entity issues shares of stock or other
consideration to the Borrower's stockholders in connection with the merger,
consolidation or acquisition, the surviving or acquiring corporation shall adopt
this Agreement and, upon the conversion of the Advances, the Lender Group shall,
at no additional cost, be entitled to receive, in lieu of the number of shares
of common stock of Borrower ("Common Stock") to which such Advances are then
convertible, the number and class of shares of stock or other consideration to
which the Lender Group would have been entitled pursuant to the terms of the
merger, consolidation or acquisition if immediately prior thereto the Lender
Group had been holder of record of the number of shares of Common Stock equal to
the number of shares of Common Stock for which the Advances shall then be
convertible.

      7.    MISCELLANEOUS.

            7.1 AMENDMENTS, ETC. No amendment or waiver of any provision of this
Agreement, nor consent to any departure by the Borrower therefrom, shall in any
event be effective unless the same shall be in writing and signed by the Lender
Group, and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given.

            7.2 NOTICES, ETC. All notices and other communications provided for

                                       -13-
<PAGE>

hereunder shall be in writing (including telecopier communication) and mailed,
telecopied or delivered, if to the Borrower, at its address at

                  NATURADE, INC.
                  14370 Myford Road, Suite 100
                  Irvine, California  92606
                  Fax: (714) 573-4816

            with a copy to

                  Sheppard, Mullin, Richter & Hampton LLP
                  333 South Hope Street, 48th Floor
                  Los Angeles, California 90071
                  Attention: James M. Rene, Esq.
                  Fax:  213-620-1398

            and if to HH, at its address at:

                  HEALTH HOLDINGS AND BOTANICALS, LLC
                  c/o Doyle & Boissiere LLC
                  330 Primrose Road, Suite 500
                  Burlingame, California 94010

                  Fax: (650) 685-8711

                                       -14-
<PAGE>

            with a copy to:

                  MBV Law LLP
                  101 Vallejo St.
                  San Francisco, California 94111
                  Fax: (415) 989-5143

            and if to Wald, at its address at:

                  WALD Holdings, LLC
                  7730 Carondelet Ave
                  Suite 135
                  St. Louis, Missouri 63105
                  Fax: 314-721-3043

                        and

                  David Weil
                  2338 Immokalee Road
                  Unit 103
                  Naples, Florida 34110

or, as to each party, at such other address as shall be designated by such party
in a written notice to the other party. All such notices and communications
shall effective when actually received by the party notified.

            7.3 NO WAIVER; REMEDIES. No failure on the part of the Lender Group
to exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any such right
preclude any other or further exercise thereof or the exercise of any other
right. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law.

            7.4 CERTAIN TERMS. All accounting terms not specifically defined
herein shall be construed in accordance with generally accepted accounting
principles consistent with those applied in the preparation of the Borrower's
financial statements. As used herein the term "including" shall be construed to
mean "including, without limitation", unless expressly stated to the contrary.

            7.5 UNCERTAINTY AND CONFLICT. In the event that the Borrower
receives

                                       -15-
<PAGE>

inconsistent instructions from members of the Lender Group or determines in its
sole discretion that it is uncertain as to its duties or actions hereunder or
has received any instruction or notice from a member of the Lender Group which,
in the sole opinion of the Borrower, is in conflict with any of the provisions
of this Agreement or with any instructions or notices from the other parties
hereto, Borrower shall be entitled to decline to take any further action until
the Borrower receives a joint written direction from all members of the Lender
Group or an order of a court of competent jurisdiction directing the Borrower to
take action in accordance with such written direction or order.

            7.6   COSTS, EXPENSES AND TAXES.

                  (a) The Borrower agrees to pay on demand all costs and
      expenses in connection with the preparation, execution, delivery,
      administration, modification and amendment of this Agreement and the other
      documents to be delivered hereunder, including, without limitation, the
      reasonable fees and out-of-pocket expenses of counsel for the Collateral
      Agent and the Lender Group with respect thereto and with respect to
      advising the Lender Group as to its rights and responsibilities under this
      Agreement. The Borrower further agrees to pay on demand all costs and
      expenses, if any (including reasonable counsel fees and expenses), in
      connection with the enforcement (whether through negotiations, legal
      proceedings or otherwise) of this Agreement and the other documents to be
      delivered hereunder, including, without limitation, reasonable counsel
      fees and expenses in connection with the enforcement of rights under this
      Section 7.6(a). In addition, the Borrower shall pay any and all stamp and
      other taxes payable or determined to be payable in connection with the
      execution and delivery of this Agreement and the other documents to be
      delivered hereunder, and agrees to save the Collateral Agent and the
      Lender Group harmless from and against any and all liabilities with
      respect to or resulting from any delay in paying or omission to pay such
      taxes.

                  (b) The Borrower agrees to indemnify the Collateral Agent and
      the Lender Group from and against any and all claims, losses and
      liabilities growing out of or resulting from this Agreement (including,
      without limitation, enforcement of this Agreement), except claims, losses
      or liabilities resulting from the Collateral Agent and the Lender Group's
      gross negligence or willful misconduct as determined by a final judgment
      of a court of competent jurisdiction, and except to the extent arising
      from matters contemplated by Section 7.5 above.

                                       -16-
<PAGE>

                  (c) The Borrower will upon demand pay to the Collateral Agent
      and the Lender Group the amount of any and all reasonable expenses,
      including the reasonable fees and expenses of its counsel and of any
      experts and agents, that the Collateral Agent and the Lender Group may
      incur in connection with (i) the administration of this Agreement, (ii)
      the custody, preservation, use or operation of, or the sale of, collection
      from or other realization upon, any of the Collateral, (iii) the exercise
      or enforcement of any of the rights of the Collateral Agent and the Lender
      Group hereunder or (iv) the failure by the Borrower to perform or observe
      any of the provisions hereof.

            7.7 RIGHT OF SET-OFF. Upon the occurrence and during the continuance
of any Event of Default the Lender Group, upon prior written consent of Required
Combined Lenders, is hereby authorized at any time and from time to time, to the
fullest extent permitted by law, to set off and apply any and all amounts at any
time held and other indebtedness at any time owing by the Lender Group to or for
the credit or the account of the Borrower against any and all of the obligations
of the Borrower now or hereafter existing under this Agreement, whether or not
the Lender Group shall have made any demand under this Agreement and although
such obligations may be unmatured. The Lender Group agrees promptly to notify
the Borrower after any such set-off and application, PROVIDED that the failure
to give such notice shall not affect the validity of such set-off and
application. The rights of the Lender Group under this Section are in addition
to other rights and remedies (including, without limitation, other rights of
set-off) which the Lender Group may have.

            7.8 BINDING EFFECT. This Agreement shall be binding upon and inure
to the benefit of the Borrower and the Collateral Agent and the Lender Group and
their respective successors and assigns, except that the Borrower shall not have
the right to assign its rights hereunder or any interest herein without the
prior written consent of the Lender Group.

            7.9   GOVERNING LAW.  This Agreement shall be governed by, and
construed in accordance with, the laws of the State of California.

            7.10 USURY. Anything to the contrary appearing in this Agreement
notwithstanding, if any return, interest payment, or other charge payable under
this Agreement shall at any time exceed the maximum amount chargeable by
applicable law, then the applicable rate of return or interest shall be the
maximum rate permitted by applicable law.

            7.11 SUBORDINATION. The Borrower's obligation under this Agreement

                                       -17-
<PAGE>

shall in all respects be subject and subordinate to the Borrower's obligations
to Wells Fargo Business Credit ("Bank"). Lender Group hereby agrees that (i)
upon Bank's request, Lender Group will in good faith negotiate and enter into a
reasonable subordination agreement with Bank respecting the Secured Obligations
created hereby, and (ii) upon approval of the Lenders holding a majority in
interest in Advances made at any time hereunder (whether or not such Advances
hereafter have been converted pursuant to Section 4 above), each Lender will in
good faith negotiate and enter into a reasonable subordination agreement
respecting the Secured Obligations created hereby with such other lenders to the
Borrower which propose to extend additional credit to the Borrower from time to
time provided that the terms of such additional credit provide that (a) any such
lender will have a first priority lien on the assets of the Borrower, and (ii)
any such lender does not receive an equity interest or equity participation in
the Borrower in connection with extending such credit to Borrower.

            7.12 EFFECTIVE DATE. This Agreement shall become effective and
binding on the parties hereto upon the execution and delivery hereof by the
parties hereto and receipt any necessary consents to this Agreement and the
transactions contemplated hereby (such date of effectiveness is referred to
herein as the "Effective Date").

                                       -18-
<PAGE>

            IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized, as of the
date first above written.

                                    NATURADE, INC.

                                    By:
                                          -------------------------------------

                                    Title:
                                          -------------------------------------

                                    HEALTH HOLDINGS AND
                                    BOTANICALS, LLC, as a Lender and as
                                    Collateral Agent

                                    By:
                                        -------------------------------------

                                    Title:
                                        -------------------------------------

                                    WALD HOLDINGS, LLC

                                    By:
                                        -------------------------------------

                                    Title:
                                        -------------------------------------

                                       -19-
<PAGE>

                                  EXHIBIT A

                     CONVERTIBLE SECURED PROMISSORY NOTE

$XXXX                                                     Irvine, California
                                                                        Date

            FOR VALUE RECEIVED, NATURADE, INC., a Delaware corporation
("Obligor"), hereby promises to pay to the order of (Investor) ("Payee"), in
lawful money of the United States at the address of Payee set forth below, the
amount of (Insert dollar amount), together with interest on the unpaid principal
amount hereof.

            Interest shall be paid quarterly in arrears, from the date hereof
until paid in full, at the rate of eight percent (8.00%) per annum, with the
first payment of interest due on (Insert date). Unpaid principal together with
all accrued interest shall be due and payable on (Insert date). Capitalized
terms not otherwise defined in this Note shall have the meanings assigned to
them in the Loan Agreement (as defined below).

            This Note may be prepaid, in whole or in part, upon at least thirty
calendar days' notice to Payee, as further provided in the Loan Agreement.
Payments by Obligor shall be applied first to any and all accrued interest
through the payment date and second to the principal remaining due hereunder.
Upon payment in full of all principal and interest payable hereunder, this Note
shall be surrendered to Obligor for cancellation.

            If any payment of principal or interest on this Note shall become
due on a Saturday, Sunday, or a public holiday under the laws of the State of
California, such payment shall be made on the next succeeding business day and
such extension of time shall be included in computing interest in connection
with such payment.

            This Note is issued pursuant to and entitled to the benefits of the
Loan Agreement and related agreements by and between Obligor and Payee dated
August 31, 2000 ("Loan Agreement"), and reference thereto is hereby made for a
more complete statement of the terms under which the loan evidenced hereby is to
be repaid, including the fact that the loan is subject to acceleration and the
loan is subject to Payee's right to convert, all as set forth in the Loan
Agreement. This Note is secured by certain collateral, more specifically
described in the Loan Agreement.

            Obligor waives presentment, demand for performance, notice of

                                       -20-
<PAGE>

nonperformance, protest, notice of protest, and notice of dishonor. No delay on
the part of Payee in exercising any right hereunder shall operate as a waiver of
such right under this Note. This Note is being delivered in the State of
California. This Note shall be governed in all respects by the laws of the State
of California as it applies to contracts between California residents, which are
made and to be performed in California.

            If the indebtedness represented by this Note or any part thereof is
collected at law or in equity or in bankruptcy, receivership or other judicial
proceedings or if this Note is placed in the hands of attorneys for collection
after default, Obligor agrees to pay, in addition to the principal and interest
payable herein, reasonable attorneys' fees and costs incurred by Payee.

            The Obligor and the Payee intend to comply at all times with
applicable usury laws. If at any time such laws would render usurious any
amounts due under this Note, then it is the Obligor's and the Payee's express
intention that the Obligor not be required to pay interest on this Note at a
rate in excess of the maximum lawful rate, that the provisions of this paragraph
shall control over all other provisions of this Note which may be in apparent
conflict hereunder, that such excess amount shall be immediately credited to the
principal balance of this Note (or, if this Note has been fully paid, refunded
by the Payee to the Obligor), and the provisions hereof shall be immediately
reformed and the amounts thereafter collectible under this Note reduced, without
the necessity of the execution of any further documents, so as to comply with
the then applicable usury law, but so as to permit the recovery of the fullest
amount otherwise due under this Note. Any such crediting or refund shall not
cure or waive any default by the Obligor under this Note. The term "applicable
law" as used in this Note shall mean the laws of the State of California or the
laws of the United States, whichever laws allow the greater rate of interest, as
such laws now exist or may be changed or amended or come into effect in the
future.

            No modification, amendment or waiver of any provision of this Note
shall be effective unless approved in a writing specifically referring to this
Note and signed by the party against whom enforcement of the amendment is
sought. In the event that Obligor fails to make payment on the date for payment
hereinabove specified of all principal and interest due hereunder on such date,
then this Note shall accrue interest at the highest rate permitted by law, until
paid in full.

            Each notice or other communication required or permitted hereunder
(except payment) shall be in writing and shall be deemed given or made (a) on
the day delivered if delivered in person to the party to whom it is directed, or
by overnight

                                       -21-
<PAGE>

courier, (b) on the day delivery is confirmed by the recipient's
signature if deposited in the United States Mail, registered or certified,
return receipt requested, (c) on the day confirmed by the receiving facsimile
machine if sent by facsimile during regular business hours, in each case
addressed to the party to whom it is directed at the address set forth in the
Loan Agreement. Either party may, by notice given at any time or from time to
time, require that subsequent notices be given at a different address. Any
payment shall be deemed made upon receipt by Payee.

            IN WITNESS WHEREOF, Obligor has caused this Note to be executed and
delivered by its duly authorized officer as of the date and at the place first
written above.

                               OBLIGOR:    NATURADE, INC.,
                                           a Delaware corporation

                                           By:
                                                ----------------------------

                                           Its:
                                                 ---------------------------

                                       -22-

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