10-Q

	UNITED STATES
	SECURITIES AND EXCHANGE COMMISSION

	WASHINGTON, D.C.  20549

	FORM 10-Q


	QUARTERLY REPORT UNDER SECTION 13 OF THE
	SECURITIES EXCHANGE ACT OF 1934

	FOR THE QUARTERLY PERIOD ENDED

	June 30, 2005


	Commission File No. 001-13458


	SCOTT'S LIQUID GOLD-INC.
	4880 Havana Street
	Denver, CO  80239
	Phone:  303-373-4860

      Colorado        			      84-0920811
State of Incorporation			   I.R.S. Employer
                                       Identification No.



	Indicate by check mark whether the Registrant:  (1) has
filed all reports required to be filed by Section 13 or 15(d) of
the Securities Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
                           Yes  [X]             No  [ ]

	Indicate by checkmark whether the registrant is an
accelerated filer (as defined in Rule 12b-2 of the Act).
                           Yes  [ ]             No  [X]

	As of June 30, 2005, the Registrant had 10,471,000 shares of
its $0.10 par value common stock outstanding.













PART I.	FINANCIAL INFORMATION

Item 1.	Financial Statements

	SCOTT'S LIQUID GOLD-INC. & SUBSIDIARIES
	Consolidated Statements of Operations (Unaudited)

                      Three Months Ended          Six Months Ended
                  -------------------------   -------------------------
                            June 30,                    June 30,
                      2005          2004          2005          2004
                  -----------   -----------   -----------   -----------
Net sales         $ 5,724,800   $ 5,307,900   $11,247,300   $10,516,900

Operating costs
  and expenses:
   Cost of sales    3,131,400     2,970,000     6,238,900     5,720,600
   Advertising        202,000       173,400       478,500       637,100
   Selling          1,491,000     1,457,500     2,966,300     2,781,400
   General and
     administrative   999,200       950,200     2,022,000     1,936,700
                  -----------   -----------   -----------   -----------
                    5,823,600     5,551,100    11,705,700    11,075,800
                  -----------   -----------   -----------   -----------

Loss from operations  (98,800)     (243,200)     (458,400)     (558,900)
Interest income         7,800         9,900        20,400        20,500
Interest expense      (47,500)      (42,600)      (95,400)      (88,300)
                  -----------   -----------   -----------   -----------
                     (138,500)     (275,900)     (533,400)     (626,700)
Income tax
  expense (benefit)      -             -             -             -
                  -----------   -----------   -----------   -----------
Net loss          $  (138,500)  $  (275,900)  $  (533,400)  $  (626,700)
                  ===========   ===========   ===========   ===========

Net loss per common
 share (Note 3):
   Basic          $     (0.01)  $     (0.03)  $     (0.05)  $     (0.06)
                  ===========   ===========   ===========   ===========
   Diluted        $     (0.01)  $     (0.03)  $     (0.05)  $     (0.06)
                  ===========   ===========   ===========   ===========

Weighted average shares
outstanding:
   Basic           10,471,000    10,361,900    10,471,000    10,359,000
                  ===========   ===========   ===========   ===========
   Diluted         10,471,000    10,361,900    10,471,000    10,359,000
                  ===========   ===========   ===========   ===========








                    SCOTT'S LIQUID GOLD-INC. & SUBSIDIARIES
                          Consolidated Balance Sheets

                                            June 30,     December 31,
                                              2005           2004
                                          ------------   -------------
                                           (Unaudited)
ASSETS
Current assets:
   Cash and cash equivalents              $ 1,637,700    $ 3,354,600
   Investment securities                       53,400         54,200
   Trade receivables, net of allowance
    for doubtful accounts of $135,400
    and $83,000, respectively                 658,400      1,419,700
   Other receivables                           62,300         56,900
   Inventories                              5,979,300      2,940,300
   Prepaid expenses                           422,700        489,600
   Deferred tax assets                        317,500        339,400
                                          -----------    -----------
      Total current assets                  9,131,300      8,654,700

Property, plant and equipment, net         14,005,200     14,349,600
Other assets                                   17,200         22,600
                                          -----------    -----------
   TOTAL ASSETS                           $23,153,700    $23,026,900
                                          ===========    ===========

LIABILITIES AND SHAREHOLDERS' EQUITY
Current  liabilities:
   Line of Credit                         $   860,000    $   790,000
   Accounts payable                         2,753,500      1,795,700
   Accrued payroll and benefits             1,218,700      1,050,500
   Other accrued expenses                     353,500        413,700
   Current maturities of
    long-term debt                            941,000        917,000
                                          -----------    -----------
      Total current liabilities             6,126,700      4,966,900

Long-term debt, net of current maturities   1,416,100      1,893,000
Deferred tax liabilities                      317,500        339,400
                                          -----------    -----------
      Total liabilities                     7,860,300      7,199,300
                                          -----------    -----------

Commitments and contingencies
Shareholders' equity:
   Common stock; $.10 par value, authorized
     50,000,000 shares; issued and
     outstanding 10,471,000 shares          1,047,100      1,047,100
   Capital in excess of par                 4,979,200      4,979,200
   Accumulated comprehensive income             3,400          4,200
   Retained earnings                        9,263,700      9,797,100
                                          -----------    -----------
      Shareholders' equity                 15,293,400     15,827,600
                                          -----------    -----------

   TOTAL LIABILITIES AND
  SHAREHOLDERS' EQUITY                    $23,153,700    $23,026,900
                                          ===========    ===========


                  SCOTT'S LIQUID GOLD-INC. & SUBSIDIARIES
	        Consolidated Statements of Cash Flows (Unaudited)

                                                Six Months Ended
                                                    June 30,
                                          --------------------------
                                              2005           2004
                                          -----------    -----------

Cash flows from operating activities:
Net loss                                  $  (533,400)   $  (626,700)
                                          -----------    -----------
  Adjustments to reconcile net loss
    to net cash provided (used) by
    operating activities:
      Depreciation and amortization           371,300        369,200
      Stock issued to ESOP                       -            11,400
      Changes in assets and liabilities:
         Trade and other receivables, net     755,900       (286,900)
         Inventories                       (3,039,100)       (81,500)
         Prepaid expenses and
          other assets                         58,800        (28,200)
         Accounts payable and
          accrued expenses                  1,065,800        387,500
                                          -----------    -----------
         Total adjustments to net loss       (787,300)       371,500
                                          -----------    -----------
           Net Cash Used by
            Operating Activities           (1,320,700)      (255,200)
                                          -----------    -----------

Cash flows from investing activities:
    Purchase of investment securities        (248,400)          -
    Proceeds from sale or maturity of
      investment securities                   250,000           -
    Purchase of property,
     plant & equipment                        (15,000)       (66,800)
                                          -----------    -----------
           Net Cash Used by
            Investing Activities              (13,400)       (66,800)
                                          -----------    -----------

Cash flows from financing activities:
    Proceeds from short-term
     borrowings                               200,000           -
    Payments on short-term
     borrowings                              (130,000)          -
    Principal payments on long-term
     borrowings                              (452,800)      (432,500)
                                          -----------    -----------
           Net Cash Used
            Financing Activities             (382,800)      (432,500)
                                          -----------    -----------
Net Decrease in Cash and
 Cash Equivalents                          (1,716,900)      (754,500)

Cash and Cash Equivalents,
 beginning of period                        3,354,600      3,498,600
                                          -----------    -----------
Cash and Cash Equivalents,
 end of period                            $ 1,637,700    $ 2,744,100
                                          ===========    ===========

Supplemental disclosures:
    Cash paid during period for:
      Interest                            $    93,000    $    88,900
                                          ===========    ===========
      Income taxes                        $       600    $       100
                                          ===========    ===========


               SCOTT'S LIQUID GOLD-INC. & SUBSIDIARIES
        Notes to Consolidated Financial Statements (Unaudited)

Note 1. Summary of Significant Accounting Policies

(a)	Company Background
	Scott's Liquid Gold-Inc. (a Colorado corporation) was
incorporated on February 15, 1954.  Scott's Liquid Gold-Inc. and
its wholly owned subsidiaries (collectively, "we" or "our")
manufacture and market quality household and skin care products.
Since the first quarter of 2001, we have acted as a distributor
in the United States of beauty care products contained in
individual sachets and manufactured by Montagne Jeunesse.
Our business is comprised of two segments, household products and
skin care products.

(b)	Principles of Consolidation
	Our consolidated financial statements include our accounts
and our subsidiaries.  All intercompany accounts and transactions
have been eliminated.

(c)	Use of Estimates
	The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of
America requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure
of contingent assets and liabilities at the date of the financial
 statements and the reported amounts of revenues and expenses during
the reporting period.  Significant estimates include, but are not
limited to, realizability of deferred tax assets, reserves for slow
moving and obsolete inventory, customer returns and allowances, and
bad debts. Actual results could differ from those estimates.

(d)	Cash Equivalents
	We consider all highly liquid investments with an original
maturity of three months or less at the date of acquisition to be
cash equivalents.

(e)	Investments in Marketable Securities
	We account for investments in marketable securities in
accordance with Statement of Financial Accounting Standards ("SFAS")
No. 115 "Accounting for Certain Investments in Debt and Equity
Securities", which requires that we classify investments in
marketable securities according to management's intended use of
such investments.  We invest our excess cash and have established
guidelines relative to diversification and maturities in an effort
to maintain safety and liquidity.  These guidelines are periodically
reviewed and modified to take advantage of trends in yields and
interest rates.  We consider all investments as available for use
in our current operations and, therefore, classify them as
short-term, available-for-sale investments.  Available-for-sale
investments are stated at fair value, with unrealized gains and
losses, if any, reported net of tax, as a separate component of
shareholders' equity and comprehensive income (loss).  The cost
of the securities sold is based on the specific identification
method. Investments in corporate and government securities as of
June 30, 2005, are scheduled to mature within one year.

(f)	Inventories
	Inventories consist of raw materials and finished goods and
are stated at the lower of cost (first-in, first out method) or
market.  We record a reserve for slow moving and obsolete products
and raw materials.

	Inventories were comprised of the following at:

                                 June 30, 2005      December 31, 2004
- ----------------------------------------------------------------------
      Finished goods             $ 4,667,200           $ 2,256,100
      Raw materials                1,621,100               993,200
      Inventory valuation
       in reserve                   (309,000)             (309,000)
- ----------------------------------------------------------------------
                                 $ 5,979,300           $ 2,940,300
======================================================================

(g)	Property, Plant and Equipment
	Property, plant and equipment are recorded at historical cost.
Depreciation is provided using the straight-line method over
estimated useful lives of the assets ranging from three to
forty-five years.  Building structures and building improvements
are estimated to have useful lives of 35 to 45 years and 3 to 20
years, respectively.  Production equipment and production support
equipment are estimated to have useful lives of 15 to 20 years and
3 to 10 years, respectively.  Office furniture and office machines
are estimated to have useful lives 10 to 20 and 3 to 5 years,
respectively.  Carpeting, drapes and company vehicles are estimated
to have useful lives of 5 to 10 years.  Maintenance and repairs are
expensed as incurred.  Improvements that extend the useful lives of
the assets or provide improved efficiency are capitalized.

(h)	Financial Instruments
	Financial instruments which potentially subject us to
concentrations of credit risk include cash and cash equivalents,
investments in marketable securities, and trade receivables.  We
maintain our cash balances in the form of bank demand deposits
with financial institutions that management believes are
creditworthy.  We establish an allowance for doubtful accounts
based upon factors surrounding the credit risk of specific
customers, historical trends and other information.  We have no
significant financial instruments with off-balance sheet risk of
accounting loss, such as foreign exchange contracts, option
contracts or other foreign currency hedging arrangements.

	The recorded amounts for cash and cash equivalents,
receivables, other current assets, and accounts payable and
accrued expenses approximate fair value due to the short-term
nature of these financial instruments. The fair value of investments
in marketable securities is based upon quoted market value.  Our
long-term debt bears interest at a variable rate, the lender's base
rate, which approximates the prime rate.  The carrying value of
long-term debt approximates fair value as of June 30, 2005 and
December 31, 2004.

i)	Long-Lived Assets
	We account for long-lived assets in accordance with the
provisions of SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets."  This Statement requires that
long-lived assets and certain identifiable intangibles be
reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount of an asset may not be recoverable.
Recoverability of assets to be held and used is measured by a
comparison of the carrying amount of an asset to future net cash
flows expected to be generated by the asset.  If such assets are
considered to be impaired, the impairment to be recognized is
measured by the amount by which the carrying amount of the assets
exceeds the fair value of the assets.  Assets to be disposed of
are reported at the lower of the carrying amount or fair value
less costs to sell.

(j)	Income Taxes
	We account for income taxes in accordance with the provisions
of SFAS No. 109, "Accounting for Income Taxes," which requires the
recognition of deferred tax assets and liabilities for the expected
future tax consequences attributable to differences between the
financial statement carrying amounts of assets and liabilities and
their respective tax bases.  A valuation allowance is provided when
it is more likely than not that some portion or all of a deferred
tax asset will not be realized.  The ultimate realization of deferred
tax assets is dependent upon the generation of future taxable income
during the period in which related temporary differences become
deductible.  Deferred tax assets and liabilities are measured using
enacted tax rates expected to apply to taxable income in the years
in which those temporary differences are expected to be recovered
or settled.

(k)	Revenue Recognition
	Revenue is generally recognized upon delivery of products
to customers, which is when title passes.  Reserves for estimated
market development support, pricing allowances and returns are
provided in the period of sale as a reduction of revenue.
Reserves for returns and allowances are maintained at a level that
management believes is appropriate to account for amounts
applicable to existing sales.  Reserves for coupons and certain
other promotional activities are recorded as a reduction of revenue
at the later of the date at which the related revenue is recognized
or the date at which the sales incentive is offered.  At June 30,
2005 and December 31, 2004 approximately $811,000 and $862,600,
respectively, had been reserved as a reduction of accounts
receivable, and approximately $70,000 and $90,000, respectively,
had been reserved as current liabilities.  Co-op advertising,
marketing funds, slotting fees and coupons are deducted from gross
sales and total $855,500 and $921,800 for the six months ended at
June 30, 2005 and June 30, 2004, respectively.

(l)	Advertising Costs
	We expense advertising costs as incurred.

(m)	Stock-based Compensation

	We have elected to follow Accounting Principles Board Opinion
("APB") No. 25, "Accounting for Stock Issued to Employees" and
related interpretations in accounting for our employee stock
options.  Under APB No. 25, employee stock options are accounted
for based upon the intrinsic value, which is the difference between
the exercise price and fair value of the underlying common stock.
Generally, if the exercise price of employee stock options equals
the market price of the underlying stock on the date of the grant,
no compensation expense is recorded.  We have adopted the disclosure
only provisions of SFAS No. 123, "Accounting for Stock-based
Compensation".

	We granted 455,000 options for shares of our common stock
during the six months ended June 30, 2005 with an average exercise
price equal to $0.55.  Had compensation cost been recorded based on
the fair value of options granted by us, our pro-forma net loss and
net loss per share would have been as follows:

                                Three Months Ended June 30,
              --------------------------------------------------------
                         2005                        2004
              --------------------------    --------------------------
              As Reported     Pro Forma    As Reported      Pro-Forma
              -----------   -----------    -----------    ------------
Net loss      $ (138,500)   $ (227,600)    $ (275,900)    $ (275,900)
Basic loss
 per share    $    (0.01)   $    (0.02)    $    (0.03)    $    (0.03)
Diluted loss
 per share    $    (0.01)   $    (0.02)    $    (0.03)    $    (0.03)


                                 Six Months Ended June 30,
               ------------------------------------------------------
                          2005                        2004
               -------------------------    -------------------------
               As Reported    Pro Forma     As Reported    Pro Forma
               -----------   -----------    -----------   -----------
Net loss       $ (533,400)   $ (624,500)    $  (626,700)  $  (643,000)
Basic loss
 per share     $    (0.05)   $    (0.06)    $     (0.06)  $     (0.06)
Diluted loss
 per share     $    (0.05)   $    (0.06)    $     (0.06)  $     (0.06)

	The fair value of options granted has been estimated as of
the date of grant using the following assumptions as of:


                       Three Months Ended           Six Months Ended
                            June 30,                    June 30,
                     ----------------------      ----------------------
                       2005         2004           2005         2004
                     ---------    ---------      ---------    ---------
Dividend rate          $  -        $  -           $  -         $  -
Expected volatility       65%        169%             65%         169%
Risk-free
 interest rate          3.80%       3.04%           3.80%        3.04%
Expected life
 (in years)              4.5         4.5             4.5          4.5

(n)	Comprehensive Income
	We follow SFAS No. 130, "Reporting Comprehensive Income"
which establishes standards for reporting and displaying
comprehensive income and its components. Comprehensive income
includes all changes in equity during a period from non-owner
sources.

	The following table is a reconciliation of our net loss to
its total comprehensive loss for the three months and six months
ended June 30, 2005 and 2004:

                      Three Months Ended           Six Months Ended
                             June 30,                   June 30,
                    ------------------------  ------------------------
                        2005         2004         2005         2004
                    -----------  -----------  -----------  -----------
Net loss            $  (138,500) $  (275,900) $  (533,400) $  (626,700)
Unrealized gain
 (loss) on investment
 securities                 700       (3,000)        (800)      (2,500)
                    -----------  -----------  -----------  -----------
Comprehensive loss  $  (137,800) $  (278,900) $  (534,200) $  (629,200)
                    ===========  ===========  ===========  ===========

(o)	Operating Costs and Expenses Classification

	Cost of sales includes costs associated with manufacturing and
distribution including labor, materials, freight-in, purchasing and
receiving, quality control, internal transfer costs, repairs,
maintenance and other indirect costs, as well as warehousing and
distribution costs.  We classify shipping and handling costs
comprised primarily of freight-out and nominal outside warehousing
costs as a component of selling expense on the accompanying
Consolidated Statement of Operations.  Shipping and handling costs
totaled $760,100 and $690,500 for the six months ended June 30,
2005 and 2004, respectively.

	Selling expenses consist primarily of shipping and handling
costs, wages and benefits for sales and sales support personnel,
travel brokerage commissions, promotional costs, as well as other
indirect costs.

	General and administrative expenses consist of wages and
benefits associated with management and administrative support
departments, business insurance costs, professional fees, office
facility related expenses and other general support costs.

(p)	Recently Issued Accounting Pronouncements
	The FASB has issued Statement of Financial Accounting
Standards No. 151, "Inventory Costs - an amendment of ARB No. 43,
Chapter 4" (SFAS No. 151).  The provisions of SFAS 151 are
intended to eliminate narrow differences between the existing
accounting standards of the FASB and the International Accounting
Standards Board (IASB) related to inventory costs, in particular,
the treatment of abnormal idle facility expense, freight, handling
costs, and spoilage.  SFAS No. 151 requires that theses costs be
recognized as current period charges regardless of the extent to
which they are considered abnormal.  The provisions of SFAS 151 are
effective for inventory costs incurred during fiscal years beginning
after June 15, 2005.  The adoption of SFAS 151 is not expected to
have a material impact on our operations, financial position or
liquidity.

	In December 2004, the FASB issued Statement of Financial
Accounting Standards No. 123, (revised 2004) "Share-Based Payment"
("SFAS 123(R)"). This statement is a revision of Statement of
Financial Accounting Standards No. 123, "Accounting for Stock-Based
Compensation" as amended ("SFAS 123"), and requires entities to
measure the cost of employee services received in exchange for an
award of equity instruments based on the grant-date fair value of
the award. The cost will be recognized over the period during which
an employee is required to provide services in exchange for the
award (usually the vesting period). SFAS 123(R) covers various
share-based compensation arrangements including share options,
restricted share plans, performance-based awards, share
appreciation rights and employee share purchase plans. SFAS 123(R)
eliminates the ability to use the intrinsic value method of
accounting for share options, as provided in Accounting Principles
Board Opinion No. 25, "Accounting for Stock Issued to Employees"
("APB 25"). SFAS 123(R) is effective beginning January 1, 2006,
with early adoption encouraged. We are currently evaluating the
statement's transition methods and do not expect this statement
to have an effect materially different than that of the pro forma
SFAS 123 disclosures provided in Note 1 to the our Consolidated
Financial Statements included in "Item 8. Financial Statements and
Supplementary Data" in our 2004 Annual Report on Form 10-K and in
Note 1 above.

	In December 2004, the FASB issued Statement of Financial
Accounting Standards No. 153, "Exchanges of Nonmonetary Assets, an
amendment of APB Opinion No. 29" ("SFAS 153"). This Statement
amends APB Opinion No. 29 to permit the exchange of nonmonetary
assets to be recorded on a carry over basis when the nonmonetary
assets do not have commercial substance. This is an exception to
the basic measurement principal of measuring a nonmonetary asset
exchange at fair value. A nonmonetary asset exchange has commercial
substance if the future cash flows of the entity are expected to
change significantly as a result of the exchange. SFAS 153 is
effective for nonmonetary asset exchanges occurring in fiscal
periods beginning after June 15, 2005. We have not entered into
exchanges of nonmonetary assets in the past and do not expect to
enter into any nonmonetary assets exchanges in the foreseeable
future; however, if we enter into significant nonmonetary asset
exchanges in the future, SFAS 153 could have a material effect on
our consolidated financial position, results of operations or
cash flows.

(q)	Reclassifications
	Certain reclassifications have been made to the December 31,
2004 balance sheet to conform to the current period presentation.

Note 2.	Basis of Preparation of Financial Statements

	We have prepared these unaudited interim consolidated
financial statements in accordance with the rules and regulations
of the Securities and Exchange Commission.  Such rules and
regulations allow the omission of certain information and footnote
disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles as long
as the statements are not misleading.  In the opinion of management,
 all adjustments necessary for a fair presentation of these
interim statements have been included and are of a normal recurring
nature.  These interim financial statements should be read in
conjunction with our financial statements included in our 2004
Annual Report on Form 10-K.

Note 3.

	Per share data was determined by using the weighted average
number of common shares outstanding.  Potentially dilutive
securities, including stock options, are considered only for
diluted earnings per share, unless considered anti-dilutive.
The potentially dilutive securities, which are comprised of
outstanding stock options of 1,560,500 and 1,134,000 at June 30,
2005 and 2004, respectively, were excluded from the computation
of weighted average shares outstanding due to the anti-dilutive
effect.

	A reconciliation of the weighted average number of common
shares outstanding for the three and six months ended June 30,
2005 follows:

                                                             Total
                            Three Months    Six Months       Shares
                            ------------   ------------   ------------
Common shares outstanding,
  beginning of the period    10,471,000     10,471,000     10,471,000
Stock options exercised            -              -              -
                             ----------     ----------     ----------

Weighted average number
 of common shares
 outstanding                 10,471,000     10,471,000     10,471,000

Dilutive effect of common
 share equivalents                -               -             -
                             ----------     ----------     ----------
Diluted weighted average
 number of common shares
 outstanding                 10,471,000     10,471,000     10,471,000
                             ==========     ==========     ==========

	At June 30, 2005, there were authorized 50,000,000 shares
of our $0.10 par value common stock and 20,000,000 shares of
preferred stock issuable in one or more series.  None of the
preferred stock was issued or outstanding at June 30, 2005.

Note 4.	Segment Information

	We operate in two different segments: household products and
skin care products. Our products are sold in the United States and
internationally (primarily Canada), directly and through independent
 brokers, to mass merchandisers, drug stores, supermarkets,
wholesale distributors and other retail outlets. Our Management has
chosen to organize our business around these segments based on
differences in the products sold. The household products segment
includes "Scott's Liquid Gold" for wood, a wood cleaner which
preserves as it cleans, and "Touch of Scent," a room air
freshener. The skin care segment includes: "Alpha Hydrox," alpha
hydroxy acid cleansers and lotions; a retinol product; "Diabetic
Skin Care," a healing cream and moisturizer developed to address
skin conditions of diabetics; and skin care and other sachets of
Montagne Jeunesse distributed by us.

	The following provides information on our segments for the
three and six months ended June 30:

                                Three Months ended June 30,
                     ----------------------------------------------
                               2005                    2004
                     ----------------------  ----------------------
                     Household   Skin Care   Household   Skin Care
                     Products    Products    Products    Products
                     ----------  ----------  ---------- -----------

Net sales to
 external customers  $2,061,300  $3,663,500  $2,452,100  $2,855,800
                     ==========  ==========  ==========  ==========
Income(loss) before
 Profit sharing,
 bonuses and
 income  taxes       $ (333,300) $  194,800  $  (43,600) $ (232,300)
                     ==========  ==========  ==========  ==========
Identifiable assets  $3,802,200  $8,417,200  $3,851,500  $6,433,400
                     ==========  ==========  ==========  ==========

                                 Six Months ended June 30,
                     ----------------------------------------------
                               2005                    2004
                     ----------------------  ----------------------
                     Household   Skin Care   Household   Skin Care
                     Products    Products    Products    Products
                     ----------  ----------  ----------  ----------
Net sales to
 external customers  $4,153,500  $7,093,800  $4,755,400  $5,761,500
                     ==========  ==========  ==========  ==========
Income(loss) before
 profit sharing,
 bonuses and
 income taxes        $ (754,600) $  221,200  $ (434,400) $ (192,300)
                     ==========  ==========  ==========  ==========
Identifiable assets  $3,802,200  $8,417,200  $3,851,500  $6,433,400
                     ==========  ==========  ==========  ==========

	The following is a reconciliation of segment information to
consolidated information for the three and six months ended June 30:

               Three Months ended June 30,   Six Months ended June 30,
               ---------------------------   --------------------------
                   2005           2004           2005           2004
               ------------  -------------   ------------  ------------
Net sales to
 external
 customers     $ 5,724,800    $ 5,307,900    $11,247,300    $10,516,900
               ===========    ===========    ===========    ===========
Loss before
 profit
 sharing,
 bonuses and
 income taxes  $  (138,500)   $  (275,900)   $  (533,400)   $  (626,700)
               ===========    ===========    ===========    ===========
Identifiable
 assets        $12,219,400    $10,284,900    $12,219,400    $10,284,900
Corporate
 assets         10,934,300     13,473,900     10,934,300     13,473,900
               -----------    -----------    -----------    -----------
Consolidated
 total assets  $23,153,700    $23,758,800    $23,153,700    $23,758,800
               ===========    ===========    ===========    ===========

	Corporate assets noted above are comprised primarily of our
cash and investments, deferred income tax assets and property and
equipment not directly associated with the manufacturing,
warehousing, shipping and receiving activities.

Item 2.	Management's Discussion and Analysis of Financial
             Condition and Results of Operations

Results of Operations

	During the first half of 2005 we experienced increases in
sales of our Montagne Jeunesse line of skin care products and an
increase in sales of our other skin care products because of the
introductions of new Alpha Hydrox products and additional Montagne
Jeunesse sachets, while experiencing a decrease in our line of
household products.  Our net loss for the first half of 2005 was
$533,400 versus a loss of $626,700 in the first half of 2004.  The
loss for 2005 was primarily due to a lower profit margin on the
sales increase of our Montagne Jeunesse products and to the
household products sales decrease, coupled with higher raw material
costs for both segments.

Summary of Results as a Percentage of Net Sales

                          Year Ended      Six Months Ended
                          December 31,      June 30,
                          ------------   ------------------
                             2004          2005       2004
                           -------       -------    -------
Net sales
   Scott's Liquid Gold
    household products      41.3%         36.9%       45.2%
   Neoteric Cosmetics       58.7%         63.1%       54.8%
                           ------         ------     ------
Total Net Sales            100.0%         100.0%     100.0%
Cost of Sales               57.0%          55.5%      54.4%
                           ------         ------     ------
Gross profit                43.0%          44.5%      45.6%
Other revenue                0.2%           0.2%       0.2%
                           ------         ------     ------
                            43.2%          44.7%      45.8%
                           ------         ------     ------

Operating expenses          46.4%          48.6%      50.9%
Interest                     0.8%           0.8%       0.9%
                           ------         ------     ------
                            47.2%          49.4%      51.8%
                           ------         ------     ------

Loss before income taxes    (4.0%)         (4.7%)     (6.0%)
                           ======         ======     ======

	Our gross margins may not be comparable to those of other
entities, since some entities include all of the costs related to
their distribution network in cost of sales and others, like us,
exclude a portion of them (freight out to customers and nominal
outside warehouse costs) from gross margin, including them instead
in the selling expense line item. See Note 1(o), Operating Costs
and Expenses Classification, to the Consolidated Financial
Statements in this Report.

Comparative Net Sales

                                                           Percentage
                                                            Increase
                                2005            2004       (Decrease)
                            -----------    -----------     ----------
Scott's Liquid Gold         $ 3,248,600    $ 3,414,600       (4.9%)
Touch of Scent                  904,900      1,340,700      (32.5%)
                            -----------    -----------      ------
     Total household
      products                4,153,500      4,755,300      (12.7%)
                            -----------    -----------      ------

Alpha Hydrox and
 other skin care              2,400,800      2,150,900       11.6%
Montagne Jeunesse
 skin care                    4,693,000      3,610,700       30.0%
                            -----------    -----------      ------
     Total skin care
      products                7,093,800      5,761,600       23.1%
                            -----------    -----------      ------

          Total Net
           Sales            $11,247,300    $10,516,900        6.9%
                            ===========    ===========      ======

Six Months Ended June 30, 2005
Compared to Six Months Ended June 30, 2004

	Consolidated net sales for the first half of the current year
were $11,247,300 vs. $10,516,900 for the first six months of 2004,
an increase of $730,400 or about 6.9%.  Average selling prices for
the first six months of the year 2005 were up by $64,800 over those
of the comparable period of 2004, prices of household products
being up by $219,100, while average selling prices of skin care
products were down by $154,300.  This decrease was primarily due
to price promotions on selected cosmetic products. Co-op
advertising, marketing funds, slotting fees and coupon expenses
paid to retailers were subtracted from gross sales in accordance
with current accounting policies totaling $855,500 in the first
half of 2005 versus $921,800 in the same period in 2004, a
decrease of $66,300 or 7.2%.

	During the first half of the year, net sales of skin care
products accounted for 63.1% compared to 54.8% for the same period
of 2004.  Net sales of these products for those periods were
$7,093,800 in 2005 compared to $5,761,600 in 2004, an increase of
$1,332,200 or 23.1%. We have continued to experience a drop in unit
sales of our earlier-established alpha hydroxy acid products due
primarily to maturing in the market for alpha hydroxy acid-based
skin care products, intense competition from producers of similar
or alternative products, many of which are considerably larger than
Neoteric Cosmetics, Inc. and reduced distribution of these products
at retail stores in prior periods.  During the first quarter of 2005
we began introduction of four new items in our Alpha Hydrox line of
cosmetic products. Because of this, our sales of Alpha Hydrox
products (with and without alpha hydroxy acid) have increased during
the first half of 2005.  Although we are optimistic that this trend
will continue, it is still too early to tell the acceptance of these
products over time.  For the first half of 2005, the sales of our
Alpha Hydrox products accounted for 23.3% of net sales of skin care
products and 14.7% of total net sales, compared to 25.2% of net
sales of skin products and 13.8% of total net sales in the first
half of 2004.

	For 2005, sales of Montagne Jeunesse products comprised a
majority of net sales of our skin care products.  Net sales of
Montagne Jeunesse were approximately $4,693,000 in 2005 compared
to $3,610,700 in 2004.  We believe that this increase in sales of
Montagne Jeunesse is attributable primarily to an increase in the
number and type of Montagne Jeunesse sachets on retailers' shelves
in the first half of 2005 versus 2004.  We also believe that there
were fewer units of products left over from holiday sales at the
end of 2004 versus 2003 thus creating a need to replenish retailer
inventory in the following year.

	In 2001, we commenced purchases of the skin care sachets
from Montagne Jeunesse under a distribution agreement covering the
United States.  Montagne Jeunesse is the sole supplier of that
product.  On May 4, 2005, we entered into a new distribution
agreement with Montagne Jeunesse International Ltd., which replaces
the distribution agreement previously in effect.  Sales of these
products represent a significant source of our revenues.  If the
Montagne Jeunesse distribution agreement were to be terminated, it
would significantly reduce our revenues, would have a material
adverse effect on our operating results and cash flow and, absent
other developments, would result in the need for substantial
reductions in our expenses.  The principal and controlling owner
of Montagne Jeunesse is, to the knowledge of the Company, the
beneficial owner at March 15, 2005 of approximately 10% of our
outstanding common stock.

	Sales of household products for the first half of this year
accounted for 36.9% of consolidated net sales compared to 45.2% for
the same period of 2004. These products are comprised of "Scott's
Liquid Gold" for wood, a wood cleaner which preserves as it cleans,
and "Touch of Scent", a room air freshener.  During the six months
ended June 30, 2005, sales of household products were $4,153,500,
as compared to sales of $4,755,300 for the same six months of 2004.
Sales of "Scott's Liquid Gold" for wood were down by $166,000, a
decrease of 4.9%.  This decrease was due to decreased distribution
at retail stores.  Sales of "Touch of Scent" were down by $435,800
or 32.5% primarily due to a decrease in distribution.  In the
second quarter, we began introducing a wood wash under the
Scott's Liquid Gold product line; sales have been minimal to date.

	As sales of a consumer product decline, there is the risk that
retail stores will stop carrying the product.  The loss of any
significant customer for any Alpha Hydrox products, "Scott's Liquid
Gold" for wood or "Touch of Scent", could have a significant adverse
impact on our revenues and operating results.  We believe that our
future success is highly dependent on favorable acceptance in the
marketplace of Montagne Jeunesse products and the sales of our
Alpha Hydrox products and "Scott's Liquid Gold" for wood.

	On a consolidated basis, cost of goods sold was $6,238,900
during the first six months of 2005 compared to $5,720,600 for the
same period of 2004, an increase of $518,300 (9.1%, on a sales
increase of 6.9%).  As a percentage of consolidated net sales for
the first half of 2005, cost of goods sold was 55.5% compared to
54.4% in 2004, an increase of 2.0%, which was essentially due to
greater sales of Montagne Jeunesse products at a higher cost per
unit, along with the increased cost of steel cans and the increase
in the cost of petroleum based raw materials used in many of our
products, offset somewhat by a lower cost of sales (as a percentage
of sales) on our new Alpha Hydrox products.

	Operating Expenses, Interest Expense and Other Income

                                                         Percentage
                                                          Increase
                                2005           2004      (Decrease)
                            -----------    -----------   ----------
Operating Expenses
     Advertising            $   478,500    $   637,100     (24.9%)
     Selling                  2,966,300      2,781,400       6.6%
     General &
      Administrative          2,022,000      1,936,700       4.4%
                            -----------    -----------     ------
          Total operating
           expenses         $ 5,466,800      5,355,200       2.1%
                            ===========    ===========     ======

Interest Income             $    20,400    $    20,500      (0.1%)

Interest Expense            $    95,400    $    88,300       8.0%

	Operating expenses, comprised primarily of advertising,
selling and general and administrative expenses, increased $111,600
in the first half of 2005, when compared to the first half of 2004.
The various components of operating expenses are discussed below.

	Advertising expenses for the first six months of 2005 were
$478,500 compared to $637,100 for the comparable six months of
2004, a decrease of $158,600 or 24.9%.  That decrease was entirely
due to a decrease in advertising expenses applicable to household
products.

	Selling expenses for the first half of 2005 were $2,966,300
compared to $2,781,400 for the comparable six months of 2004, an
increase of $184,900 or 6.6%.  That increase was comprised of an
increase in freight and brokerage expenses of $49,600, an increase
in salaries and fringe benefits and related travel expense of
$141,500 primarily because of an increase in personnel in 2005
versus 2004, offset by a net decrease in other selling expenses,
none of which by itself is significant, of $6,200.

	General and administrative expenses for the first six months
of 2005 were $2,022,000 compared to $1,936,700 for the comparable
period of 2004, an increase of $85,300 or 4.4%.  Such increase was
attributable to an increase in bad debt expense $43,200, an
increase in professional fees of $24,000, and a net increase in
other administrative expenses, none of which by itself is
significant, of $18,100.

	Interest expense for the first six months of 2005 was
$95,400 versus $88,300 for the comparable period of 2004.
Interest expense increased because of higher interest rates and
borrowing levels under our line of credit.  Interest income for
the six months ended June 30, 2005 was $20,400 compared to $20,500
for the same period of 2004, which consists of interest earned on
the Company's cash reserves in 2005 and 2004.

	During the first six months of 2005 and 2004, expenditures
for research and development were not material (under 2% of
revenues).

Three Months Ended June 30, 2005
Compared to Three Months Ended June 30, 2004

	Consolidated net sales for the second quarter of the current
year were $5,724,800 versus $5,307,900 for the comparable quarter
of 2004, an increase of $416,900 or about 7.9%. Average selling
prices for the second quarter of 2005 were up by $123,800 over those
of the comparable period of 2004, prices of household products being
up by $181,300, while average selling prices of skin care products
were down by $57,500.  Co-op advertising, marketing funds, slotting
fees and coupon expenses paid to retailers were subtracted from
gross sales in accordance with current accounting policies totaling
$491,500 in the second quarter of 2005 versus $406,700 in the same
period in 2004, an increase of $84,800 or 20.9%.  Because of the
introduction of our new products, we are likely to see a similar
increase in these expenses in subsequent quarters this year.  This
increase consisted of an increase in coupon expenses of $55,500,
an increase in slotting of $78,300, offset by a decrease in co-op
advertising of $49,000.

	During the second quarter of 2005, net sales of skin care
products accounted for 64.0% of consolidated net sales compared to
53.8% for the second quarter of 2004.  Net sales of these products
for those periods were $3,663,500 in 2005 compared to $2,855,800 in
2004, an increase of $807,700 or 28.3%. The increase was almost
entirely due to the introduction of four new items in our Alpha
Hydrox line of products.  Net sales of Montagne Jeunesse were
approximately $1,943,900 in the second quarter of 2005 compared to
$1,946,500 in the second quarter of 2004.

	Sales of household products for the second quarter of this
year accounted for 36.0% of consolidated net sales compared to
46.2% for the same period of 2004. These products are comprised of
"Scott's Liquid Gold" for wood, a wood cleaner which preserves as
it cleans, and "Touch of Scent", a room air freshener.  During the
second quarter of 2005, sales of household products were
$2,061,300, as compared to sales of $2,452,100 for the same three
months of 2004.  Sales of "Scott's Liquid Gold" for wood were down
by $61,600, a decrease of 3.5%.  Sales of "Touch of Scent" were
down by $329,200 or 47.2%. Please see the discussion above for the
first half of 2005 for additional information regarding sales of
household products, which is also applicable to sales of household
products in the second quarter of 2005.

	On a consolidated basis, cost of goods sold was $3,131,400
during the second quarter of 2005 compared to $2,970,000 for the
same period of 2004, an increase of $161,400 (5.4%, on a sales
increase of 7.9%).  As a percentage of consolidated net sales for
the second quarter of 2005, cost of goods sold was 54.7% compared
to 56.0% in 2004, a decrease of 2.2%.  This percentage decrease was
essentially due to greater sales of our Alpha Hydrox products at a
lower cost per unit offset by increased cost of steel cans and the
increase in the cost of petroleum based raw materials used in many
of our products.

	Operating expenses, comprised primarily of advertising,
selling and general and administrative expenses, increased $111,100
in the second quarter of 2005, when compared to the same period
during 2004.  The various components of operating expenses are
discussed below.

	Advertising expenses for the second quarter of 2005 were
$202,000 compared to $173,400 for the comparable quarter of 2004,
an increase of $28,600 or 16.5%. Advertising expenses applicable
to household products increased by $9,100 (11.0%) during the second
quarter of 2005, and advertising expenses for Alpha Hydrox products
increased for the comparative three-month period by $19,500 (21.5%).

	Selling expenses for the three months ended June 30, 2005 were
$1,491,000 compared to $1,457,500 for the comparable three months of
2004, an increase of $33,500 or 2.3%.  That increase was primarily
because of an increase in salaries and fringe benefits and related
travel expense of $40,300 resulting from an increase in personnel in
2005 versus 2004, offset by a net decrease in other selling expenses,
none of which by itself is significant, of $6,800.

	General and administrative expenses for the second quarter of
2005 were $999,200 compared to $950,200 for the comparable period of
2004, an increase of $49,000 or 5.2%.  Such increase was primarily
attributable to an increase in bad debt expense ($16,200), an increase
in professional fees of $12,100, and a net increase in other
administrative expenses, none of which by itself is significant, of
$20,700.

	Interest expense for the second quarter of 2005 was $47,500
versus $42,600 for the comparable period of 2004.  Interest expense
increased because of higher interest rates and borrowing levels under
our line of credit.  Interest income for the three months ended
June 30, 2005 was $7,800 compared to $9,900 for the same period
of 2004.

	During the second quarter of 2005 and of 2004, expenditures
for research and development were not material (under 2% of revenues).

Liquidity and Capital Resources

	On August 8, 2005 we obtained a new $1,800,000 line of
Credit with Citywide Banks of Aurora, Colorado.  This line replaced
the $1,500,000 line of credit dated August 8, 2004, from the same
bank.  Initially the original line of credit was to assist with
inventory for the 2004 holiday sales; we continue to use the line
of credit for inventory and other working capital purposes.  The
line of credit bears interest at a rate of .5% over the bank's base
rate (6.0% at June 30, 2005) and matures on August 8, 2006.  The
line of credit is secured by inventory and accounts receivable.
Under its terms, events of default include a material adverse
change in our financial condition.  The covenants remain the
same as the bank loan described below.

	We have a bank loan for approximately $2.6 million at the
bank's base rate, adjustable annually each November (5.00% at
November 2004), secured by our land and buildings, with principal
and interest payable monthly through November 2007.  The loan
agreement contains a number of covenants, including the requirement
for maintaining a current ratio of at least 1:1 and a ratio of
consolidated long-term debt to consolidated net worth of not more
than 1:1.  We may not declare any dividends that would result in a
violation of either of these covenants.  The foregoing requirements
were met at the end of the first half of 2005.

	During the first half of 2005, our working capital decreased
by $683,200, and concomitantly, our current ratio (current assets
divided by current liabilities) decreased from 1.74 at December 31,
2004 to 1.49 at June 30, 2005. This decrease in working capital is
attributable to a net loss in the first six months of 2005 of
$533,400, a reduction in long-term debt of $476,900, a decrease in
deferred tax liabilities of $21,900, and a decrease in accumulated
comprehensive income of $800, offset by depreciation in excess of
capital additions of $344,400, and a decrease in other assets
of $5,400.

	At June 30, 2005, trade accounts receivable were $658,400
versus $1,419,700 at year-end, largely because sales in December
of 2004 were greater than those of June of 2005.  Accounts payable
increased from the end of 2004 through June of 2005 by $957,800
corresponding primarily with the increase in inventory over that
period.  At June 30, 2005 inventories were $3,039,000 more than
at December 31, 2004, due to the increase in inventories of
Montagne Jeunesse, Alpha Hydrox, and household products to
support sales of these products in the upcoming quarters.
Accrued payroll and benefits increased $168,200 from December 31,
2004 to June 30, 2005 primarily because of the increase in accrued
employee fringe benefits.  Other accrued liabilities decreased by
$60,200 primarily because of a decrease in accrued property taxes.

	We have no significant capital expenditures planned for 2005
and have no current plans for any external financing, other than our
existing bank loans. We expect that our available cash, cash flows
from operating activities and borrowings under our line of credit
will fund the cash requirements through
June 30, 2006.

	Our dependence on operating cash flow means that risks
involved in our business can significantly affect our liquidity.
Any loss of a significant customer, any further decreases in
distribution of our skin care or household products, any new
competitive products affecting sales levels of our products, or
any significant expense not included in our internal budget could
result in the need to raise cash, such as through a bank financing.
Except for the short-term line of credit described above, we have
no arrangements for an external financing of debt or equity, and
we are not certain whether any such financing would be available
on acceptable terms.  Please also see other risks summarized in
"Forward Looking Statements" below.  We expect our operating
cash flows to improve if we achieve profitability in 2005.

Quantitative and Qualitative Disclosures About Market Risk

	Market risk represents the risk of loss due to adverse
changes in financial and commodity market prices and rates.
We are not materially exposed to market risks regarding interest
 rates because the interest on our outstanding debt is at the
lender's base rate, which approximates the prime rate, adjustable
yearly.  Our investments in debt and equity securities are
short-term and not subject to significant fluctuations in fair
value.  If interest rates were to rise 10% from year-end levels,
the fair value of our debt and equity securities would have
decreased by approximately $600.  Further, we do not use foreign
currencies in our business.  Currently, we receive payments for
sales to parties in foreign countries in U.S. dollars.
Additionally, we do not use derivative instruments or engage in
hedging activities.  As a result, we do not believe that near-term
changes in market risks will have a material effect on results of
our operations, financial position or cash flows.

Forward-Looking Statements

	This report may contain "forward-looking statements" within
the meaning of U.S. federal securities laws. These statements are
made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995.  Forward-looking
statements and our performance inherently involve risks and
uncertainties that could cause actual results to differ
materially from the forward-looking statements.  Factors that
would cause or contribute to such differences include, but are
not limited to, continued acceptance of the our products in the
marketplace; the degree of success of any new product or product
line introduction by us; competitive factors; any decrease in
distribution of (i.e., retail stores carrying) our significant
products; continuation of our distributorship agreement with
Montagne Jeunesse; the need for effective advertising of our
products; limited resources available for such advertising; new
competitive products and/or technological changes; dependence
upon third party vendors and upon sales to major customers;
changes in the regulation of our products, including applicable
environmental regulations; adverse developments in pending
litigation; the loss of any executive officer; and other matters
discussed in our periodic filings with the Securities and
Exchange Commission.  We undertake no obligation to revise any
forward-looking statements in order to reflect events or
circumstances that may arise after the date of this report.

Item 3.	Quantitative and Qualitative Disclosures About
             Market Risk

	Please see "Market Risks" in Item 2 of Part I of this Report
which information is incorporated herein by this reference.

Item 4.	Controls and Procedures

	As of June 30, 2005, we conducted an evaluation, under the
supervision and with the participation of the Chief Executive
Officer and Chief Financial Officer, of the effectiveness of the
design and operation of our disclosure controls and procedures.
Based on that evaluation, the Chief Executive Officer and Chief
Financial Officer concluded that our disclosure controls and
procedures are effective to ensure that information required to be
disclosed by us in reports that we file or submit under the
Securities Exchange Act of 1934 is recorded, processed, summarized,
and reported within the time periods specified in Securities and
Exchange Commission rules and forms as of June 30, 2005.  There
was no change in our internal control over financial reporting
during the quarter ended June 30, 2005 that has materially affected,
or is reasonably likely to materially affect, our internal control
over financial reporting.

PART II	OTHER INFORMATION

Item 1.	Not Applicable

Item 2.	Not Applicable

Item 3.	Not Applicable

Item 4.	Submission of Matters to a Vote of Security Holders

	On May 4, 2005, we held our 2005 Annual Meeting of Shareholders.
At that meeting, the seven existing directors were nominated and
re-elected as our directors.  These seven persons constitute all
members of our Board of Directors.  These directors and the votes
for and withheld for each of them were as follows:

                          For              Withheld
                        ---------          --------
Mark E. Goldstein       8,021,121           213,678
Jeffrey R. Hinkle       8,018,031           216,768
Jeffry B. Johnson       8,018,031           216,768
Dennis P. Passantino    8,018,031           216,768
Carl A. Bellini         8,031,881           202,918
Dennis H. Field         8,031,881           202,918
Gerald J. Laber         8,032,381           202,418

	In addition, at the 2005 Annual Meeting of Shareholders, our
shareholders approved the Scott's Liquid Gold-Inc. 2005 Incentive
Stock Plan as set forth in Exhibit B to our Proxy Statement dated
April 6, 2005.  The votes at such meeting with respect to such Plan
were as follows:

    For        Against      Abstain       Broker Non-Votes
- ---------     ---------    ---------      ----------------
4,281,713       317,351        4,850          3,630,885

Item 5.	Not Applicable

Item 6.	Exhibits

10.0    Business Loan Agreement with Citywide Banks regarding a line
         of credit, a related Promissory Note and a related
         Security Agreement, all dated August 8, 2005
31.1    Rule 13a-14(a) Certification of the Chief Executive
        Officer
31.2    Rule 13a-14(a) Certification of the Chief Financial
        Officer
32.1    Section 1350 Certification


SIGNATURES

	Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this Report to be signed on
its behalf by the undersigned thereunto duly authorized.

       				SCOTT'S LIQUID GOLD-INC.


August 10, 2005		BY:  /s/ Mark E. Goldstein
    Date 				--------------------------------------
					Mark E. Goldstein
					President and Chief Executive Officer


August 10, 2005		BY:  /s/ Jeffry B. Johnson
    Date				--------------------------------------
					Jeffry B. Johnson
					Treasurer and Chief Financial Officer


EXHIBIT INDEX

Exhibit No.       Document

10.0              Business Loan Agreement with Citywide Banks
                   regarding a line of credit, a related Promissory
                   Note and a related Security Agreement, all dated
                   August 8, 2005
31.1              Rule 13a-14(a) Certification of the Chief
                    Executive Officer
31.2              Rule 13a-14(a) Certification of the Chief
                    Financial Officer
32.1              Section 1350 Certification

EX-10

                                                            EXHIBIT 10.0

                                BUSINESS LOAN AGREEMENT

Borrower:	Scott's Liquid Gold-Inc.
		4880 Havana Street
		Denver, CO  80239

Lender:	Citywide Banks
		PO Box 128
		Aurora, CO  80040-0128
		(303) 365-3600

THIS BUSINESS LOAN AGREEMENT dated August 8, 2005, is made and
executed between Scott's Liquid Gold-Inc. ("Borrower") and Citywide
Banks ("Lender") on the following terms and conditions. Borrower
has received prior commercial loans from Lender or has applied to
Lender for a commercial loan or loans or other financial
accommodations, including those which may be described on any
exhibit or schedule attached to this Agreement ("Loan"). Borrower
understands and agrees that: (A) in granting, renewing, or
extending any Loan, Lender is relying upon Borrower's representations,
warranties, and agreements as set forth in this Agreement;
(B) the granting, renewing, or extending of any Loan by Lender
at all times shall be subject to Lender's sole judgment and
discretion; and (C) all such Loans shall be and remain subject
to the terms and conditions of this Agreement.

TERM. This Agreement shall be effective as of August 8, 2005, and
shall continue in full force and effect until such time as all of
Borrower's Loans In favor of Lender have been paid in full,
including principal, interest, costs, expenses, attorneys' fees,
and other fees and charges, or until August 8, 2006.

CONDITIONS PRECEDENT TO EACH ADVANCE. Lender's obligation to make
the initial Advance and each subsequent Advance under this
Agreement shall be subject to the fulfillment to Lender's
satisfaction of all of the conditions set forth in this Agreement
and in the Related Documents.

Loan Documents. Borrower shall provide to Lender the following
documents for the Loan: (1) the Note; (2) Security Agreements
granting to Lender security interests in the Collateral;
(3) financing statements and all other documents perfecting
Lender's Security Interests; (4) evidence of insurance as required
below; (5) together with all such Related Documents as Lender may
require for the Loan; all in form and substance satisfactory to
Lender and Lender's counsel.

Borrower's Authorization. Borrower shall have provided in form and
substance satisfactory to Lender properly certified resolutions,
duly authorizing the execution and delivery of this Agreement, the
Note and the Related Documents, In addition, Borrower shall have
provided such other resolutions, authorizations, documents and
instruments as Lender or its counsel, may require.

Payment of Fees and Expenses. Borrower shall have paid to Lender
all fees, charges, and other expenses which are then due and
payable
as specified in this Agreement or any Related Document.

Representations and Warranties. The representations and warranties
set forth in this Agreement, in the Related Documents, and in any
document or certificate delivered to Lender under this Agreement
are true and correct.

No Event of Default. There shall not exist at the time of any
Advance a condition which would constitute an Event of Default
under this Agreement or under any Related Document.

REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants
to Lender, as of the date of this Agreement, as of the date of
each disbursement of loan proceeds, as of the date of any renewal,
extension or modification of any Loan, and at all times any
Indebtedness exists:

Organization. Borrower is a corporation for profit which is, and
at all times shall be, duly organized, validly existing, and in
good standing under and by virtue of the laws of the State of
Colorado Borrower has the full power and authority to own its
properties and to transact the business in which it is presently
engaged or presently proposes to engage. Borrower maintains an
office at 4880 Havana Street, Denver, CO 80239. Unless Borrower
has designated otherwise in writing, the principal office is the
office at which Borrower keeps its books and records including
its records concerning the Collateral. Borrower will notify Lender
prior to any change in the location of Borrower's state of
organization or any change in Borrower's name. Borrower shall do
all things necessary to preserve and to keep in full force and
effect its existence, rights and privileges, and shall comply
with all regulations, rules, ordinances, statutes, orders and
decrees of any governmental or quasi-governmental authority or
court applicable to Borrower and Borrower's business activities.

Assumed Business Names. Borrower has filed or recorded all
documents or filings required by law relating to all assumed
business names used by Borrower. Excluding the name of Borrower,
the following is a complete list of all assumed business names
under which Borrower does business:

Borrower          Assumed Business Names    Filing Location   Date
Scott's Liquid    SLG Chemicals, Inc.
 Gold-Inc.        Neoteric Cosmetics, Inc.
                  Colorado Product
                   Concepts, Inc.

Authorization. Borrower's execution, delivery, and performance of
this Agreement and all the Related Documents have been duly
authorized by all necessary action by Borrower and do not conflict
with, result in e violation of, or constitute a default under
(1) any provision of (a) Borrower's articles of incorporation or
organization, or bylaws, or (b) any agreement or other instrument
binding upon Borrower or (2) any law, governmental regulation,
court decree, or order applicable to Borrower or to Borrower's
properties.

Financial Information. Each of Borrower's financial statements
supplied to Lender truly and completely discloses Borrower's
financial condition as of the date of the statement, and there
has been no material adverse change in Borrower's financial
condition subsequent to the date of the most recent financial
statement supplied to Lender. Borrower has no material contingent
obligations except as disclosed in such financial statements.

Legal Effect. This Agreement constitutes, and any instrument or
agreement Borrower is required to give under this Agreement when
delivered will constitute legal, valid, and binding obligations
of Borrower enforceable against Borrower in accordance with their
respective terms.

Properties. Except as contemplated by this Agreement or as
previously disclosed in Borrower's financial statements or in
writing to Lender and as accepted by Lender, and except for
property tax liens for taxes not presently due and payable,
Borrower owns and has good title to all of Borrower's properties
free and clear of all Security Interests, and has not executed
any security documents or financing statements relating to such
properties. All of Borrower's properties are titled in Borrower's
legal name, and Borrower has not used or filed a financing
statement under any other name for at least the last five (5) years.

Hazardous Substances. Except as disclosed to and acknowledged by
Lender in writing, Borrower represents and warrants that:
(1) During the period of Borrower's ownership of Borrower's
Collateral, there has been no use, generation, manufacture,
storage, treatment, disposal, release or threatened release of
any Hazardous Substance by any person on, under, about or from
any of the Collateral. (2) Borrower has no knowledge of, or
reason to believe that there has been (a) any breach or violation
of any Environmental Laws; (b) any use, generation, manufacture,
storage, treatment, disposal, release or threatened release of
any Hazardous Substance on, under, about or from the Collateral
by any prior owners or occupants of any of the Collateral; or
(c) any actual or threatened litigation or claims of any kind by
any person relating to such matters. (3) Neither Borrower nor any
tenant, contractor, agent or other authorized user of any of the
Collateral shall use, generate, manufacture, store, treat, dispose
of or release any Hazardous Substance on, under, about or from any
of the Collateral; and any such activity shall be conducted in
compliance with all applicable federal, state, and local laws,
regulations, and ordinances, including without limitation all
Environmental Laws. Borrower authorizes Lender end its agents to
enter upon the Collateral to make such inspections and tests as
Lender may deem appropriate to determine compliance of the
Collateral with this section of the Agreement. Any inspections or
tests made by Lender shall be at Borrower's expense and for
Lender's purposes only and shall not be construed to create any
responsibility or liability on the part of Lender to Borrower or
to any other person. The representations and warranties contained
herein are based on Borrower's due diligence in investigating the
Collateral for hazardous waste and Hazardous Substances. Borrower
hereby (1) releases and waives any future claims against Lender
for indemnity or contribution in the event Borrower becomes
liable for cleanup or other costs under any such laws, and
(2) agrees to indemnify and hold harmless Lender against any and
all claims, losses, liabilities, damages, penalties, and expenses
which Lender may directly or indirectly sustain or suffer
resulting from a breach of this section of the Agreement or as
a consequence of any use, generation, manufacture, storage,
disposal, release or threatened release of a hazardous waste or
substance on the Collateral. The provisions of this section of
the Agreement, including the obligation to indemnify, shall
survive the payment of the Indebtedness and the termination,
expiration or satisfaction of this Agreement and shall not be
affected by Lender's acquisition of any interest in any of the
Collateral, whether by foreclosure or otherwise.

Environmental Laws. Borrower authorizes Lender end its agents to
enter upon the Collateral to make such inspections and tests as
Lender may deem appropriate to determine compliance of the Collateral
with this section of the Agreement. Any inspections or tests made
by Lender shall be at Borrower's expense and for Lender's purposes
only and shall not be construed to create any responsibility or
liability on the part of Lender to Borrower or to any other person.
The representations and warranties contained herein are based on
Borrower's due diligence in investigating the Collateral for
hazardous waste and Hazardous Substances. Borrower hereby
(1) releases and waives any future claims against Lender for
indemnity or contribution in the event Borrower becomes liable
for cleanup or other costs under any such laws, and (2) agrees
to indemnify and hold harmless Lender against any and all claims,
losses, liabilities, damages, penalties, and expenses which Lender
may directly or indirectly sustain or suffer resulting from a
breach of this section of the Agreement or as a consequence of
any use, generation, manufacture, storage, disposal, release or
threatened release of a hazardous waste or substance on the
Collateral. The provisions of this section of the Agreement,
including the obligation to indemnify, shall survive the payment
of the Indebtedness and the termination, expiration or
satisfaction of this Agreement and shall not be affected by
Lender's acquisition of any interest in any of the Collateral,
whether by foreclosure or otherwise.

Litigation and Claims. No litigation, claim, investigation,
administrative proceeding or similar action (including those for
unpaid taxes) against Borrower is pending or threatened, and no
other event has occurred which may materially adversely affect
Borrower's financial condition or properties, other than
litigation, claims, or other events, if any, that have been
disclosed to and acknowledged by Lender in writing.

Taxes. To the best of Borrower's knowledge, all of Borrower's
tax returns and reports that are or were required to be filed,
have been filed, and all taxes, assessments and other governmental
charges have been paid in full, except those presently being or to
be contested by Borrower in good faith in the ordinary course of
business and for which adequate reserves have been provided.

Lien Priority. Unless otherwise previously disclosed to Lender in
writing, Borrower has not entered into or granted any Security
Agreements, or permitted the filling or attachment of any Security
interests on or affecting any of the Collateral directly or
indirectly securing repayment of Borrower's Loan and Note, that
would be prior or that may in any way be superior to Lender's
Security Interests and rights in and to such Collateral.

Binding Effect. This Agreement, the Note, all Security Agreements
(if any), and all Related Documents are binding upon the signers
thereof, as well as upon their successors, representatives and
assigns, and are legally enforceable in accordance with their
respective terms.

AFFIRMATIVE COVENANTS. Borrower covenants and agrees with Lender
that, so long as this Agreement remains in effect, Borrower will:

Notices of Claims and Litigation. Promptly inform Lender in
writing of (1) all material adverse changes in Borrower's
financial condition, and (2) all existing and all threatened
litigation, claims, investigations, administrative proceedings
or similar actions affecting Borrower or any Guarantor which
could materially affect the financial condition of Borrower or
the financial condition of any Guarantor.

Financial Records. Maintain its books and records in accordance
with GAAP, applied on a consistent basis, and permit Lender to
examine and audit Borrower's books and records at all reasonable times.

Financial Statements. Furnish Lender with the following:

Annual Statements. As soon as available, but in no event later
than ninety (90) days after the end of each fiscal year,
Borrower's balance sheet and income statement for the year ended,
audited by a certified public accountant satisfactory to Lender.

Interim Statements. As soon as available, but in no event later
than forty (40) days after the end of each month, Borrower's
balance sheet and profit and loss statement for the period
ended, prepared by Borrower.

Additional Requirements. Borrower will provide Lender with Monthly
Accounts Receivable Agings, Accounts Payable Agings, Monthly
Borrowing Base Certificates and Monthly Inventory Breakdown.

All financial reports required to be provided under this Agreement
shall be prepared in accordance with GAAP, applied on a consistent
basis, and certified by Borrower as being true and correct.

Additional Information. Furnish such additional information and
statements, as Lender may request from time to time.

Financial Covenants and Ratios.  Comply with the following
covenants and ratios:

Working Capital Requirements.  Borrower shall comply with the
following working capital ratio requirements:

Current Ratio.  Maintain a Current Ratio in excess of 1.000 to
1.000.  The term "Current Ratio" means Borrower's total Current
Assets divided by Borrower's total Current Liabilities.

Tangible Net Worth Requirements.  Other Net Worth Requirements
are as follows:  Ratios must be maintained or Company will not
pay dividend.  In addition, Borrower shall comply with the
following net worth ratio requirements:

Debt/Worth Ratio.  Maintain a long term debt/consolidated net
worth (in accordance with Generally Accepted Accounting
Principles (GAAP) as currently in effect) of not more than 1:1.

Insurance. Maintain fire and other risk insurance, public liability
insurance, and such other insurance as Lender may require with
respect to Borrower's properties and operations, in form, amounts,
coverages and with insurance companies acceptable to Lender.
Borrower, upon request of Lender, will deliver to Lender from
time to time the policies or certificates of insurance in form
satisfactory to Lender, including stipulations that coverages
will not be cancelled or diminished without at least ten (10)
days prior written notice to Lender. Each insurance policy also
shall include an endorsement providing that coverage in favor of
Lender will not be impaired in any way by any act, omission or
default of Borrower or any other person. In connection with all
policies covering assets in which Lender holds or is offered a
security interest for the Loans, Borrower will provide Lender
with such lender's loss payable or other endorsements as Lender
may require.

Insurance Reports. Furnish to Lender, upon request of Lender,
reports on each existing insurance policy showing such information
as Lender may reasonably request, including without limitation
the following: (1) the name of the insurer; (2) the risks
insured; (3) the amount of the policy; (4) the properties insured;
(5) the then current property values on the basis of which
insurance has been obtained, and the manner of determining those
values; and (6) the expiration date of the policy. In addition,
upon request of Lender (however not more often than annually),
Borrower will have an independent appraiser satisfactory to
Lender determine, as applicable, the actual cash value or
replacement cost of any Collateral. The cost of such appraisal
shall be paid by Borrower.

Other Agreements. Comply with all terms and conditions of all
other agreements, whether now or hereafter existing, between
Borrower and any other party and notify Lender immediately in
writing of any default in connection with any other such
agreements.

Loan Proceeds. Use all Loan proceeds solely for Borrower's
business operations, unless specifically consented to the
contrary by Lender in writing.

Taxes, Charges and Liens. Pay and discharge when due all of its
indebtedness and obligations, including without limitation all
assessments, taxes, governmental charges, levies and liens, of
every kind and nature, imposed upon Borrower or its properties,
income, or profits, prior to the date on which penalties would
attach, and all lawful claims that, if unpaid, might become a
lien or charge upon any of Borrower's properties, income, or
profits.

Performance. Perform and comply, in a timely manner, with all
terms, conditions, and provisions set forth in this Agreement,
in the Related Documents, and in all other instruments and
agreements between Borrower and Lender. Borrower shall notify
Lender immediately in writing of any default in connection with
any agreement.

Operations. Maintain executive and management personnel with
substantially the same qualifications and experience as the
present executive and management personnel; provide written
notice to Lender of any change in executive and management
personnel; conduct its business affairs in a reasonable and
prudent manner.

Environmental Studies. Promptly conduct and complete, at
Borrower's expense, all such investigations, studies, samplings
end testings as may be requested by Lender or any governmental
authority relative to any substance, or any waste or by-product
of any substance defined as toxic or a hazardous substance under
applicable federal, state, or local law, rule, regulation, order
or directive, at or affecting any property or any facility owned,
leased or used by Borrower.

Compliance with Governmental Requirements. Comply with all laws,
ordinances, and regulations, now or hereafter in effect, of all
governmental authorities applicable to the conduct of Borrower's
properties, businesses and operations, and to the use or
occupancy of the Collateral, including without limitation, the
Americans With Disabilities Act. Borrower may contest in good faith
any such law, ordinance, or regulation and withhold compliance
during any proceeding, including appropriate appeals, so long as
Borrower has notified Lender in writing prior to doing so and so
long as, in Lender's sole opinion, Lender's interests in the
Collateral are not jeopardized. Lender may require Borrower to
post adequate security or a surety bond, reasonably satisfactory
to Lender, to protect Lender's interest.

Inspection. Permit employees or agents of Lender at any reasonable
time to Inspect any and all Collateral for the Loan or Loans and
Borrower's other properties and to examine or audit Borrower's
books, accounts, and records and to make copies and memoranda of
Borrower's books, accounts, and records. If Borrower now or at
any time hereafter maintains any records (including without
limitation computer generated records and computer software
programs for the generation of such records) in the possession
of a third party, Borrower, upon request of Lender, shall notify
such party to permit Lender free access to such records at all
reasonable times and to provide Lender with copies of any
records it may request, all at Borrower's expense.

Environmental Compliance and Reports. Borrower shall comply in all
respects with any and all Environmental Laws; not cause or permit
to exist, as a result of an intentional or unintentional action
or omission on Borrower's part or on the part of any third party,
on property owned and/or occupied by Borrower, any environmental
activity where damage may result to the environment, unless such
environmental activity is pursuant to and in compliance with the
conditions of a permit issued by the appropriate federal, state or
local governmental authorities; shall furnish to Lender promptly
and in any event within thirty (30) days otter receipt thereof a
copy of any notice, summons, lien, citation, directive, letter or
other communication from any governmental agency or
instrumentality concerning any intentional or unintentional
action or omission on Borrower's part in connection with any
environmental activity whether or not there is damage to the
environment and/or other natural resources.

Additional Assurances. Make, execute and deliver to Lender such
promissory notes, mortgages, deeds of trust, security agreements,
assignments, financing statements, instruments, documents and
other agreements as Lender or its attorneys may reasonably request
 to evidence and secure the Loans and to perfect all Security
Interests.

LENDER'S EXPENDITURES. If any action or proceeding is commenced
that would materially affect Lender's interest in the Collateral
or if Borrower fails to comply with any provision of this
Agreement or any Related Documents, including but not limited
to Borrower's failure to discharge or pay when due any amounts
Borrower is required to discharge or pay under this Agreement
or any Related Documents, Lender on Borrower's behalf may (but
shall not be obligated to) take any action that Lender deems
appropriate, including but not limited to discharging or paying
all taxes, liens, security interests, encumbrances and other
claims, at any time levied or placed on any Collateral and paying
all costs for insuring, maintaining and preserving any Collateral.
All such expenditures incurred or paid by Lender for such purposes
will then bear interest at the rate charged under the Note from
the date incurred or paid by Lender to the date of repayment by
Borrower. All such expenses will become a part of the Indebtedness
and, at Lender's option, will (A) be payable on demand; (B) be
added to the balance of the Note and be apportioned among and be
payable with any installment payments to become due during either
(1) the term of any applicable insurance policy; or (2) the
remaining term of the Note; or (C) be treated as a balloon payment
which will be due and payable at the Note's maturity.

NEGATIVE COVENANTS. Borrower covenants and agrees with Lender that
while this Agreement is in effect, Borrower shall not, without the
prior written consent of Lender:

Indebtedness and Liens.  (1) Except for trade debt incurred in the
normal course of business and indebtedness to Lender contemplated
by this Agreement, create, incur or assume indebtedness for
borrowed money, including capital leases, (2) sell transfer
mortgage, assign, pledge, lease, grant a security interest in,
or encumber any of Borrower's assets (except as allowed as
Permitted Liens), or (3) sell with recourse any of Borrower's
accounts, except to Lender.

Continuity of Operations. (1) Engage in any business activities
substantially different than those in which Borrower is presently
engaged, (2) cease operations, liquidate, merge, transfer, acquire
or consolidate with any other entity, change its name, dissolve or
transfer or sell Collateral out of the ordinary course of business.

Loans, Acquisitions and Guaranties. (1) Loan, invest in or advance
money or assets to any other person, enterprise or entity,
(2) purchase, create or acquire any interest in any other
enterprise or entity, or (3) incur any obligation as surety or
guarantor other than in the ordinary course of business.

Agreements. Borrower will not enter into any agreement containing
any provisions which would be violated or breached by the
performance of Borrower's obligations under this Agreement or
in connection herewith.

CESSATION OF ADVANCES. If Lender has made any commitment to make
any Loan to Borrower, whether under this Agreement or under any
other agreement, Lender shall have no obligation to make Loan
Advances or to disburse Loan proceeds if: (A) Borrower or any
Guarantor is in default under the terms of this Agreement or
any of the Related Documents or any other agreement that Borrower
or any Guarantor has with Lender; (B) Borrower or any Guarantor
dies, becomes incompetent or becomes insolvent, files a petition
in bankruptcy or similar proceedings, or is adjudged a bankrupt;
(C) there occurs a material adverse change in Borrower's
financial condition, in the financial condition of any Guarantor,
or in the value of any Collateral securing any Loan; or (D) any
Guarantor seeks, claims or otherwise attempts to limit, modify or
revoke such Guarantor's guaranty of the Loan or any other loan
with Lender; or (E) Lender in good faith deems itself insecure,
even though no Event of Default shall have occurred.

RIGHT OF SETOFF. To the extent permitted by applicable law, Lender
reserves a right of setoff in all Borrower's accounts with Lender
(whether checking, savings, or some other account). This includes
all accounts Borrower holds jointly with someone else and all
accounts Borrower may open in the future. However, this does not
include any IRA or Keogh accounts, or any trust accounts for which
setoff would be prohibited by law. Borrower authorizes Lender, to
the extent permitted by applicable law, to charge or setoff all
sums owing on the Indebtedness against any and all such accounts.

DEFAULT. Each of the following shall constitute an Event of Default
under this Agreement:

Payment Default. Borrower fails to make any payment when due under
the Loan.

Other Defaults. Borrower fails to comply with or to perform any
other term, obligation, covenant or condition contained in this
Agreement or in any of the Related Documents or to comply with or
to perform any term, obligation, covenant or condition contained
in any other agreement between Lender and Borrower.

Default in Favor of Third Parties. Borrower or any Grantor
defaults under any loan, extension of credit, security agreement,
purchase or sales agreement, or any other agreement, in favor of
any other creditor or person that may materially affect any of
Borrower's or any Grantor's property or Borrower's or any
Grantor's ability to repay the Loans or perform their respective
obligations under this Agreement or any of the Related Documents.

False Statements. Any warranty, representation or statement made
or furnished to Lender by Borrower or on Borrower's behalf under
this Agreement or the Related Documents is false or misleading in
any material respect, either now or at the time made or furnished
or becomes false or misleading at any time thereafter.

Insolvency. The dissolution or termination of Borrower's existence
as a going business, the insolvency of Borrower, the appointment of
a receiver for any part of Borrower's property, any assignment for
the benefit of creditors, any type of creditor workout, or the
commencement of any proceeding under any bankruptcy or insolvency
laws by or against Borrower.

Defective Collateralization. This Agreement or any of the Related
Documents ceases to be in full force and effect (including failure
of any collateral document to create a valid and perfected
security interest or lien) at any time and for any reason.

Creditor or Forfeiture Proceedings. Commencement of foreclosure or
forfeiture proceedings, whether by judicial proceeding, self-help,
repossession or any other method, by any creditor of Borrower or by
any governmental agency against any collateral securing the Loan.
This includes a garnishment of any of Borrower's accounts,
including deposit accounts, with Lender, However, this Event of
Default shall not apply if there is a good faith dispute by
Borrower as to the validity or reasonableness of the claim which
is the basis of the creditor or forfeiture proceeding and if
Borrower gives Lender written notice of the creditor or forfeiture
proceeding and deposits with Lender monies or a surety bond for
the creditor or forfeiture proceeding, in an amount determined by
Lender, in its sole discretion, as being an adequate reserve or
bond for the dispute.

Events Affecting Guarantor. Any of the preceding events occurs
with respect to any Guarantor of any of the Indebtedness or any
Guarantor dies or becomes incompetent, or revokes or disputes
the validity of, or liability under, any Guaranty of the
Indebtedness.

Adverse Change. A material adverse change occurs in Borrower's
financial condition, or Lender believes the prospect of payment
or performance of the Loan is impaired.

Insecurity. Lender in good faith believes itself insecure.

EFFECT OF AN EVENT OF DEFAULT. If any Event of Default shall occur,
except where otherwise provided in this Agreement or the Related
Documents, all commitments and obligations of Lender under this
Agreement or the Related Documents or any other agreement
immediately will terminate (including any obligation to make
further Loan Advances or disbursements), and, at Lender's option,
all indebtedness immediately will become due and payable, all
without notice of any kind to Borrower, except that in the case
of an Event of Default of the type described in the "Insolvency"
subsection above, such acceleration shall be automatic and not
optional. In addition, Lender shall have all the rights and
remedies provided in the Related Documents or available at law,
in equity, or otherwise. Except as may be prohibited by applicable
law, all of Lender's rights and remedies shall be cumulative and
may be exercised singularly or concurrently, Election by Lender
to pursue any remedy shall not exclude pursuit of any other
remedy, and an election to make expenditures or to take action
to perform an obligation of Borrower or of any Grantor shall not
affect Lender's right to declare a default and to exercise its
rights and remedies.

ADDITION PROVISION. Maintain current ratio of at least 1:1

Maintain long term debt/consolidated net worth, in accordance with
Generally Accepted Accounting Principles (GAAP) as currently in
effect, of not more than 1:1.

Above ratios must be maintained in order for company to pay
dividends.

MISCELLANBOUS PROVISIONS. The following miscellaneous provisions
are a part of this Agreement:

Amendments. This Agreement, together with any Related Documents,
constitutes the entire understanding and agreement of the parties
as to the matters set forth in this Agreement. No alteration of or
amendment to this Agreement shall be effective unless given in
writing and signed by the party or parties sought to be charged or
bound by the alteration or amendment.

Attorneys' Fees; Expenses. Borrower agrees to pay upon demand all
of Lender's reasonable costs and expenses, including Lender's
attorneys' fees and Lender's legal expenses, incurred in
connection with the enforcement of this Agreement. Lender may
hire or pay someone also to help enforce this Agreement, and
Borrower shall pay the reasonable costs and expenses of sued
enforcement. Costs and expenses include Lender's attorneys'
fees and legal expenses whether or not there is a lawsuit,
including attorneys' fees and legal expenses for bankruptcy
proceedings (including efforts to modify or vacate any
automatic stay or injunction), appeals, and any anticipated
post-judgment collection services. Borrower also shall pay
all court costs and such additional fees as may be directed
by the court.

Caption Headings. Caption headings in this Agreement are for
convenience purposes only and are not to be used to interpret
or define the provisions of this Agreement.

Consent to Loan Participation. Borrower agrees and consents to
Lender's sale or transfer, whether now or later, of one or more
participation interests in the Loan to one or more purchasers,
whether related or unrelated to Lender. Lender may provide,
without any limitation whatsoever, relating to the Loan, and
Borrower hereby waives any rights to privacy Borrower may have
with respect to such matters. Borrower additionally waives any
and all notices of sale of participation interests, as well as
all notices of any repurchase of such participation interests.
Borrower also agrees that the purchasers of any such participation
interests will be considered as the absolute owners of such
interests In the Loan and will have all the rights granted under
the participation agreement or agreements governing the sale of
such participation interests. Borrower further waives all rights
of offset or counterclaim that it may have now or later against
Lender or against any purchaser of such a participation interest
and unconditionally agrees that either Lender or such purchaser
may enforce Borrower's obligation under the Loan irrespective of
the failure or insolvency of any holder of any interest in the
Loan.  Borrower further agrees that the purchaser of any such
participation interests many enforce its interests irrespective
of any personal claims or defenses that Borrower may have against Lender.

Governing Law. This Agreement will be governed by, construed and
enforced in accordance with federal law and the laws of the State
of Colorado. This Agreement has been accepted by Lender in the
State of Colorado.

No Waiver by Lender. Lender shall not be deemed to have waived any
rights under this Agreement unless such waiver is given in writing
and signed by Lender. No delay or omission on the part of Lender in
exercising any right shall operate as a waiver of such right or any
other right. A waiver by Lender of a provision of this Agreement
shall not prejudice or constitute a waiver of Lender's right
otherwise to demand strict compliance with that provision or any
other provision of this Agreement. No prior waiver by Lender, nor
any course of dealing between Lender and Borrower, or between
Lender and any Grantor, shall constitute a waiver of any of
Lender's rights or of any of Borrower's or any Grantor's
obligations as to any future transactions. Whenever the consent
of Lender is required under this Agreement, the granting of such
consent by Lender in any instance shall not constitute continuing
consent to subsequent instances where such consent is required
and in all cases such consent may be granted or withheld in the
sole discretion of Lender.

Notices. Any notice required to be given under this Agreement
shall be given in writing, and shall be effective when actually
delivered, when actually received by telefacsimile (unless
otherwise required by law), when deposited with a nationally
recognized overnight courier, or, if mailed, when deposited
in the United States mail, as first class, certified or registered
mail postage prepaid, directed to the addresses shown near the
beginning of this Agreement. Any party may change its address
for notices under this Agreement by giving formal written notice
to the other parties, specifying that the purpose of the notice
is to change the party's address. For notice purposes, Borrower
agrees to keep Lender informed at all times of Borrower's current
address. Unless otherwise provided or required by law, if there
is more than one Borrower, any notice given by Lender to any
Borrower is deemed to be notice given to all Borrowers.

Severability. If a court of competent jurisdiction finds any
provision of this Agreement to be illegal, invalid, or
unenforceable as to any circumstance, that finding shall not
make the offending provision illegal, invalid, or unenforceable
as to any ether circumstance. If feasible, the offending
provision shall be considered modified so that it becomes legal,
valid and enforceable. If the offending provision cannot be so
modified, it shall be considered deleted from this Agreement.
Unless otherwise required by law, the illegality, invalidity, or
unenforceability of any provision of this Agreement shall not
affect the legality, validity or enforceability of any other
provision of this Agreement.

Subsidiaries and Affiliates of Borrower. To the extent the context
of any provisions of this Agreement makes it appropriate,
including without limitation any representation, warranty or
covenant, the word "Borrower" as used in this Agreement shall
include all of Borrower's subsidiaries and affiliates.
Notwithstanding the foregoing however, under no circumstances
shall this Agreement be construed to require Lender to make any
Loan or other financial accommodation to any of Borrower's
subsidiaries or affiliates.

Successors and Assigns. All covenants and agreements by or on
behalf of Borrower contained in this Agreement or any Related
Documents shall bind Borrower's successors and assigns and shall
inure to the benefit of Lender and its successors and assigns.
Borrower shall not, however, have the right to assign Borrower's
rights under this Agreement or any interest therein, without the
prior written consent of Lender.

Survival of Representations and Warranties. Borrower understands
and agrees that in extending Loan Advances, Lender is relying on
all representations, warranties, and covenants made by Borrower in
this Agreement or in any certificate or other instrument delivered
by Borrower to Lender under this Agreement or the Related Documents.
Lender, all such representations, warranties and covenants will
survive the extension of Loan Advances and delivery to Lender of
the Related Documents, shall be continuing in nature, shall be
deemed made and redated by Borrower at the time each Loan Advance
is made, and shall remain in full force and effect until such time
as Borrower's Indebtedness shall be paid in full, or until this
Agreement shall be terminated in the manner provided above,
whichever is the last to occur.

Time is of the Essence. Time is of the essence in the performance
of this Agreement.

Waive Jury. All parties to this Agreement hereby waive the right
to any jury trial in any action, proceeding, or counterclaim
brought by any party against any other party.

DEFINITIONS. The following capitalized words and terms shall have
the following meanings when used in this Agreement. Unless
specifically stated to the contrary, all references to dollar
amounts shall mean amounts in lawful money of the United States
of America. Words and terms used in the singular shall include
the plural, and the plural shall include the singular, as the
context may require. Words and terms not otherwise defined in
this Agreement shall have the meanings attributed to such terms
in the Uniform Commercial Code. Accounting words and terms not
otherwise defined in this Agreement shall have the meanings
assigned to them in accordance with generally accepted accounting
principles as in effect on the date of this Agreement:

Advance. The word "Advance" means a disbursement of Loan funds
made, or to be made, to Borrower or on Borrower's behalf on a
line of credit or multiple advance basis under the terms and
conditions of this Agreement.

Agreement. The word "Agreement" means this Business Loan
Agreement, as this Business Loan Agreement may be amended or
modified from time to time, together with all exhibits and
schedules attached to this Business Loan Agreement from time
to time. Borrower. The word "Borrower" means Scott's Liquid
Gold-Inc. and includes all co-signers and co-makers signing
the Note.

Borrower.  The word "Borrower" means Scott's Liquid Gold-Inc.
and includes all co-signers and co-makers signing this Note.

Collateral. The word "Collateral" means all property and assets
granted as collateral security for a Loan, whether real or
personal property, whether granted directly or indirectly, whether
granted now or in the future, and whether granted in the form of a
security interest, mortgage, collateral mortgage, deed of trust,
assignment, pledge, crop pledge, chattel mortgage, collateral
chattel mortgage, chattel trust, factor's lien, equipment trust,
conditional sale, trust receipt, lien, charge, lien or title
retention contract, lease or consignment intended as a security
device, or any other security or lien interest whatsoever,
whether created by law, contract, or otherwise.

Environmental Laws. The words "Environmental Laws" mean any and
all state, federal and local statutes, regulations and ordinances
relating to the protection of human health or the environment,
including without limitation the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as amended,
42 U.S.C. Section 9601, et seq. ("CERCLA"), the Superfund
Amendments and Reauthorization Act of 1986, Pub. L. No. 99-499
("SARA"), the Hazardous Materials Transportation Act, 49 U.S.C.
Section 180t, et seq., the Resource Conservation and Recovery
Act, 42 U.S.C. Section 6901, et seq., or other applicable state
or federal laws, rules, or regulations adopted pursuant thereto.

Event of Default. The words "Event of Default" mean any of the
events of default set forth in this Agreement in the default
section of this Agreement.

GAAP. The word "GAAP" means generally accepted accounting principles.

Grantor. The word "Grantor" means each and all of the persons or
entities granting a Security Interest in any Collateral for the
Loan, including without limitation all Borrowers granting such a
Security Interest.

Guarantor. The word "Guarantor" means any guarantor, surety, or
accommodation party of any or all of the Loan.

Guaranty. The word "Guaranty" means the guaranty from Guarantor
to Lender, including without limitation a guaranty of all or
part of the Note.

Hazardous Substances. The words "Hazardous Substances" mean
materials that, because of their quantity, concentration or
physical, chemical or infectious characteristics, may cause or
pose a present or potential hazard to human health or the
environment when improperly used, treated, stored, disposed of,
generated, manufactured, transported or otherwise handled. The
words "Hazardous Substances" are used in their very broadest
sense and include without limitation any and all hazardous or
toxic substances, materials or waste as defined by or listed
under the Environmental Laws. The term "Hazardous Substances"
also includes, without limitation, petroleum and petroleum
by-products or any fraction thereof and asbestos.

Indebtedness. The word "Indebtedness" means the indebtedness
evidenced by the Note or Related Documents, including all
principal and interest together with all other indebtedness
and costs and expenses for which Borrower is responsible under
this Agreement or under any of the Related Documents.

Lender. The word "Lender" means Citywide Banks, its successors
and assigns.

Loan. The word "Loan" means any and all loans and financial
accommodations from Lender to Borrower whether now or hereafter
existing, and however evidenced, including without limitation
those loans and financial accommodations described herein or
described on any exhibit or schedule attached to this Agreement
from time to time.

Note. The word "Note" means the Note executed by Scott's Liquid
Gold-inc. in the principal amount of $1,500,000.00 dated
August 10, 2004, together with all renewals of, extensions of,
modifications of, refinancing of, consolidations of, and
substitutions for the note or credit agreement.

Permitted Liens. The words "Permitted Liens" mean (1) liens and
security interests securing Indebtedness owed by Borrower to
Lender; (2) liens for taxes, assessments, or similar charges
either not yet due or being contested in good faith;
(3) liens of materialmen, mechanics, warehousemen, or carriers,
or other like liens arising in the ordinary course of business
and securing obligations which are not yet delinquent;
(4) purchase money liens or purchase money security interests
upon or in any property acquired or held by Borrower in the
ordinary course of business to secure indebtedness outstanding
on the date of this Agreement or permitted to be incurred under
the paragraph of this Agreement titled "Indebtedness and Liens",
(5) liens and security interests which, as of the date of this
Agreement, have been disclosed to and approved by the Lender in
writing; and (6) those liens and security interests which in the
aggregate constitute an immaterial and insignificant monetary
amount with respect to the net value of Borrower's assets.

Related Documents. The words "Related Documents" mean all
promissory notes, credit agreements, loan agreements, environmental
agreements, guaranties, security agreements, mortgages, deeds of
trust, security deeds, collateral mortgages, and all other
instruments, agreements end documents, whether now or hereafter
existing, executed in connection with the Loan.

Security Agreement. The words "Security Agreement" mean and
include without limitation any agreements, promises, covenants,
arrangements, understandings or other agreements, whether created
by law, contrast, or otherwise, evidencing, governing, representing,
or creating a Security Interest.

Security Interest. The words "Security Interest" mean, without
limitation, any and all types of collateral secede, present and
future, whether in the form of a lien, charge, encumbrance,
mortgage, deed of trust, security deed, assignment, pledge, crop
pledge, chattel mortgage, collateral chattel mortgage, chattel
trust, factor's lien, equipment trust, conditional sale, trust
receipt, lien or title retention contrast, lease or consignment
intended as a security device, or any other security or lien
interest whatsoever whether created by law, contract, or otherwise.

Tangible Net Worth.  The words "Tangible Net Worth" means
Borrower's total assets excluding all intangible assets (i.e.,
goodwill, trademarks, patents, copyrights, organizational
expenses, and similar intangible items, but including leaseholds
and leasehold improvements) less total debt.

BORROWER ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS
BUSINESS LOAN AGREEMENT AND BORROWER AGREES TO ITS TERMS, THIS
BUSINESS LOAN AGREEMENT IS DATED AUGUST 10, 2004.

BORROWER:

Scott's Liquid Gold-Inc.


By:  /s/ Jeffry B. Johnson
     --------------------------------------
     Jeffry B. Johnson, C.F.O. &
      Treasurer of Scott's Liquid Gold-Inc.

LENDER:

Citywide Banks


By:  /s/  Theresa NeSmith
     --------------------------------------
     Authorized Signer



PROMISSORY NOTE

Borrower:	Scott's Liquid Gold-Inc. (TIN: 84-0920811)
		4880 Havana St.
		Denver, CO  80239

Lender:	Citywide Banks
		PO Box 128
		Aurora, CO  80040-0128
		(303) 365-3600

Principal Amount: $1,800,000.00
Initial Rate: 6.750%
Date of Note: August 8, 2005

PROMISE TO PAY. Scott's Liquid Gold-Inc. ("Borrower") promises to
pay to Citywide Banks ("Lender"), or order, in lawful money of the
United States of America, the principal amount of One Million Eight
Hundred Thousand & 00/100 Dollars ($1,800,000.00) or so much as may
be outstanding, together with interest on the unpaid outstanding
principal balance of each advance. Interest shall be calculated
from the date of each advance until repayment of each advance.

PAYMENT. Borrower will pay this loan in one payment of all
outstanding principal plus all accrued unpaid Interest on
August 8, 2006. In addition, Borrower will pay regular monthly
payments of all accrued unpaid interest due as of each payment
date, beginning September 8, 2005, with all subsequent interest
payments to be due on the same day of each month after that.
Unless otherwise agreed or required by applicable law, payments
will be applied first to any accrued unpaid interest; then to
principal; then to any unpaid collection costs; and then to any
late charges. The annual interest rate for this Note is computed
on a 365/360 basis; that is, by applying the ratio of the annual
interest rate over a year of 360 days, multiplied by the
outstanding principal balance, multiplied by the actual number
of days the principal balance is outstanding. Borrower will pay
Lender at Lender's address shown above or at such other place as
Leader may designate in writing.

VARIABLE INTEREST RATE. The interest rate on this Note is subject
to change from time to time based on changes in an independent
index which is The Prime Rate as Published in the Wall Street
Journal (the "Index"). The Index is not necessarily the lowest rate
charged by Lender on its loans. If the Index becomes unavailable
during the term of this loan, Lender may designate a substitute
index after notice to Borrower. Lender will tell Borrower the
current Index rate upon Borrower's request. The interest rate
change will not occur more often than each Day. Borrower understands
that Lender may make Icons based on other rates as well. The Index
currently is 6.250% per annum. The interest rate to be applied to
the unpaid principal balance of this Note will be at a rate of
0.500 percentage points over the Index, resulting in an initial
rate of 6.750% per annum. NOTICE: Under no circumstances will the
interest rate on this Note be more than the maximum rate allowed by
applicable law.

PREPAYMENT; MINIMUM INTEREST CHARGE. Borrower agrees that all loan
fees and other prepaid finance charges are earned fully as of the
date of the loan and will not be subject to refund upon early
payment (whether voluntary or as a result of default), except as
otherwise required by law, In any event, even upon full prepayment
of this Note, Borrower understands that Lender is entitled to a
minimum interest charge of $25.00. Other than Borrower's
obligation to pay any minimum interest charge, Borrower may pay
without penalty all or a portion of the amount owed earlier than
it is due. Early payments will not, unless agreed to by Lender in
writing, relieve Borrower of Borrower's obligation to continue to
make payments of accrued unpaid interest. Rather, early payments
will reduce the principal balance due. Borrower agrees not to send
Lender payments marked "paid in full", "without recourse", or
similar language. If Borrower sends such a payment, Lender may
accept it without losing any of Lender's rights under this Note,
and Borrower will remain obligated to pay any further amount owed
to Lender. All written communications concerning disputed amounts,
including any check or other payment instrument that indicates
that the payment constitutes "payment in full" of the amount owed
or that is tendered with other conditions or limitations or as
full satisfaction of a disputed amount must be mailed or
delivered to: Citywide Banks, PO Box 128, Aurora, CO 80040-0128.

LATE CHARGE. If a payment is 10 days or more late, Borrower will
be charged 5.000% of the regularly scheduled payment.

INTEREST AFTER DEFAULT. Upon default, including failure to pay
upon final maturity, at Lender's option, and if permitted by
applicable law, Lender may add any unpaid accrued interest to
principal and such sum will bear interest therefrom until paid
at the rate provided in this Note (including any increased rate).
Upon default, Lender, at its option, may, if permitted under
applicable law, increase the variable interest rate on this
Note to 21.000% per annum. The interest rate will not exceed the
maximum rate permitted by applicable law.

DEFAULT. Each of the following shall constitute an event of
default ("Event of Default") under this Note:

Payment Default. Borrower fails to make any payment when due under
this Note.

Other Defaults. Borrower fails to comply with or to perform any
other term, obligation, covenant or condition contained in this
Note of in any of the related documents or to comply with or to
perform any term, obligation, covenant or condition contained in
any other agreement between Lender and Borrower.

Default in Favor of Third Parties. Borrower or any Grantor
defaults under any loan, extension of credit, security agreement,
purchase or sales agreement, or any other agreement, in favor of
any other creditor or person that may materially affect any of
Borrower's property or Borrower's ability to repay this Note or
perform Borrower's obligations under this Note or any of the
related documents.

False Statements. Any warranty, representation or statement made
or furnished to Lender by Borrower or on Borrower's behalf under
this Note or the related documents is false or misleading in any
material respect, either now or at the time made or furnished or
becomes false or misleading at any time thereafter.

Insolvency. The dissolution or termination of Borrower's existence
as a going business, the insolvency of Borrower, the appointment of
a receiver for any part of Borrower's property, any assignment for
the benefit of creditors, any type of creditor workout, or the
commencement of any proceeding under any bankruptcy or insolvency
laws by or against Borrower.

Creditor or Forfeiture Proceedings. Commencement of foreclosure or
forfeiture proceedings, whether by judicial proceeding, self-help,
repossession or any other method, by any creditor of Borrower or by
any governmental agency against any collateral securing the loan.
This includes a garnishment of any of Borrower's accounts,
including deposit accounts, with Lender. However, this Event of
Default shall not apply if there is a good faith dispute by
Borrower as to the validity or reasonableness of the claim which
is the basis of the creditor or forfeiture proceeding and if
Borrower gives Lender written notice of the creditor or
forfeiture proceeding and deposits with Lender monies or a surety
bond for the creditor or forfeiture proceeding, in an amount
determined by Lender, in its sole discretion, as being an adequate
reserve or bond for the dispute.

Events Affecting Guarantor. Any of the preceding events occurs
with respect to any guarantor, endorser, surety, or accommodation
party of any of the indebtedness or any guarantor, endorser,
surety, or accommodation party dies or becomes incompetent, or
revokes or disputes the validity of, or liability under, any
guaranty of the indebtedness evidenced by this Note.

Adverse Change. A material adverse change occurs in Borrower's
financial condition, or Lender believes the prospect of payment
or performance of this Note is impaired,

Insecurity. Lender in good faith believes itself insecure.

LENDER'S RIGHTS. Upon default, Lender may declare the entire
unpaid principal balance on this Note and all accrued unpaid
interest immediately due, and then Borrower will pay that amount.

ATTORNEYS' FEES, EXPENSES. Lender may hire or pay someone else to
help collect this Note if Borrower does not pay. Borrower will pay
Lender the reasonable costs of such collection. This includes,
subject to any limits under applicable law, Lender's attorneys'
fees and Lender's legal expenses, whether or not there is a
lawsuit, including without limitation attorneys' fees and legal
expenses for bankruptcy proceedings (including efforts to modify
or vacate any automatic stay or injunction), and appeals. If not
prohibited by applicable law, Borrower also will pay any court
costs, in addition to all other sums provided by law.

JURY WAIVER. Lender and Borrower hereby waive the right to any
jury trial in any action, proceeding, or counterclaim brought by
either Lender or Borrower against the other.

GOVERNING LAW. This Note will be governed by, construed and
enforced in accordance with federal law and the laws of the
State of Colorado. This Note has been accepted by Lender in the
State of Colorado.

RIGHT OF SETOFF. To the extent permitted by applicable law, Lender
reserves a right of setoff in all Borrower's accounts with Lender
(whether checking, savings, or some other account). This includes
all accounts Borrower holds jointly with someone else and all
accounts Borrower may open in the future. However, this does not
include any IRA or Keogh accounts, or any trust accounts for which
setoff would be prohibited by law. Borrower authorizes Lender, to
the extent permitted by applicable law, to charge or setoff all
sums owing on the indebtedness against any and all such accounts.

COLLATERAL. Borrower acknowledges this Note is secured by Accounts
Receivables and Inventory.

LINE OF CREDIT. This Note evidences a revolving line of credit.
Advances under this Note may be requested either orally or in
writing by Borrower or directions by telephone or otherwise to
Lender are to be directed to Lender's office shown above. The
following person currently is authorized to request advances and
authorize payments under the line of credit until Lender receives
from Borrower, at Lender's address shown above, written notice of
revocation of his or her authority: Jeffry B. Johnson, Chief
Financial Officer and Treasurer of Scott's Liquid Gold-Inc.
Borrower agrees to be liable for all sums either: (A) advanced in
accordance with the instructions of an authorized person or (B)
credited to any of Borrower's accounts with Lender. The unpaid
principal balance owing on this Note at any time may be evidenced
by endorsements on this Note or by Lender's internal records,
including daily computer print-outs. Lender will have no obligation
to advance funds under this Note if: (A) Borrower or any guarantor
is in default under the terms of this Note or any agreement that
Borrower or any guarantor has with Lender, including any agreement
made in connection with the signing of this Note; (B) Borrower or
any guarantor ceases doing business or is insolvent; (C) any
guarantor seeks, claims or otherwise attempts to limit, modify
or revoke such guarantor's guarantee of this Note or any other
loan with Lender; (D) Borrower has applied funds provided pursuant
to this Note for purposes other than those authorized by Lender;
or (E) Lender in good faith believes itself insecure.

SUCCESSOR INTERESTS. The terms of this Note shall be binding upon
Borrower, and upon Borrower's heirs, personal representatives,
successors and assigns, and shall inure to the benefit of Lender
and its successors and assigns.

NOTIFY US OF INACCURATE INFORMATION WE REPORT TO CONSUMER
REPORTING AGENCIES. Please notify us if we report any inaccurate
information about your account(s) to a consumer reporting agency.
Your written notice describing the specific Inaccuracy(ies)
should be sent to us at the following address: Citywide Banks
Operations Center PO Box 128 Aurora, CO 80040-0128.

GENERAL PROVISIONS. Lender may delay or forgo enforcing any of
its rights or remedies under this Note without losing them.
Borrower and any other person who signs, guarantees or endorses
 this Note, to the extent allowed by law, waive presentment,
demand for payment, and notice of dishonor. Upon any change in
the terms of this Note, and unless otherwise expressly stated in
writing, no party who signs this Note, whether as maker,
guarantor, accommodation maker or endorser, shall be released
from liability. All such parties agree that Lender may renew or
extend (repeatedly and for any length of time) this loan or
release any party or guarantor or collateral; or impair, fail to
realize upon or perfect Lender's security interest in the
collateral; and take any other action deemed necessary by Lender
without the consent of or notice to anyone. All such parties also
agree that Lender may modify this loan without the consent of or
notice to anyone other than the party with whom the modification
is made. The obligations under this Note are joint and several.

PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE
PROVISIONS OF THIS NOTE, INCLUDING THE VARIABLE INTEREST RATE
PROVISIONS. BORROWER AGREES TO THE TERMS OF THE NOTE.

BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THIS
PROMISSORY NOTE.

BORROWER:

SCOTT'S LIQUID GOLD-INC.


BY:  /s/ Jeffry B. Johnson
     --------------------------------------
     Jeffry B. Johnson, C.F.O. &
      Treasurer of Scott's Liquid Gold-Inc.



COMMERCIAL SECURITY AGREEMENT


Grantor:	Scott's Liquid Gold-Inc. (TIN:  84-0920811)
		4880 Havana Street
		Denver, CO  80239

Lender:	Citywide Banks
		PO Box 128
		Aurora, CO  80040-0128
		(303) 365-3600

THIS COMMERCIAL SECURITY AGREEMENT dated August 8, 2004, is made
and executed between Scott's Liquid Gold-Inc. ("Grantor") and
Citywide Banks ("Lender").

GRANT OF SECURITY INTEREST. For valuable consideration, Grantor
grants to Lender a security interest in the Collateral to secure
the Indebtedness and agrees that Lender shall have the rights
stated in this Agreement with respect to the Collateral, in
addition to all other rights which Lender may have by law.

COLLATERAL DESCRIPTION. The word "Collateral" as used in this
Agreement means the following described property, whether now
owned or hereafter acquired, whether now existing or hereafter
arising, and wherever located, in which Grantor is giving to
Lender a security interest for the payment of the Indebtedness
and performance of all other obligations under the Note and
this Agreement:

       All Accounts Receivables and Inventory

In addition, the word "Collateral" also includes all the following,
whether now owned or hereafter acquired, whether now existing or
hereafter arising, and wherever located:

(A)	All accessions, attachments, accessories, replacements of
and additions to any of the collateral described herein, whether
added now or later.
(B)	All products and produce of any of the property described
in this Collateral section.
(C)	All accounts, general intangibles, instruments, rents,
monies, payments, and all other rights, arising out of a sale,
lease, consignment or other disposition of any of the property
described in this Collateral section.
(D)	All proceeds (including insurance proceeds) from the sale,
destruction, loss, or other disposition of any of the property
described in this Collateral section, and sums due from a third
party who has damaged or destroyed the Collateral or from that
party's Insurer, whether due to judgment, settlement or other
process.
(E)	All records and data relating to any of the property
described in this Collateral section, whether in the form of
a writing, photograph, microfilm, microfiche, or electronic media,
together with all of Grantor's right, title, and Interest in
and to all computer software required to utilize, create,
maintain, and process any such records or data on electronic media.
Despite any other provision of this Agreement, Lender is not
granted, and will not have, a nonpurchase money security interest
in household goods, to the extent such a security interest would
be prohibited by applicable law. In addition, if because of the
type of any Property, Lender is required to give a notice of the
right to cancel under Truth in Lending for the Indebtedness, then
Lender will not have a security interest in such Collateral
unless and until such a notice is given.

RIGHT OF SETOFF. To the extent permitted by applicable law,
Lender reserves a right of setoff in all Grantor's accounts with
Lender (whether checking, savings, or some other account). This
includes all accounts Grantor holds jointly with someone else and
all accounts Grantor may open in the future. However, this does
not include any IRA or Keogh accounts, or any trust accounts for
which setoff would be prohibited by law. Grantor authorizes
Lender, to the extent permitted by applicable law, to charge or
setoff all sums owing on the Indebtedness against any and all
such accounts.

GRANTOR'S REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE
COLLATERAL. With respect to the Collateral, Grantor represents
and promises to Lender that:

Perfection of Security Interest. Grantor agrees to take whatever
actions are requested by Lender to perfect and continue Lender's
security interest in the Collateral. Upon request of Lender,
Grantor will deliver to Lender any and all of the documents
evidencing or constituting the Collateral, and Grantor will note
Lender's interest upon any and all chattel paper and instruments
if not delivered to Lender for possession by Lender. This is a
continuing Security Agreement and will continue in effect even
though all or any part of the Indebtedness is paid in full and
even though for a period of time Grantor may not be indebted to
Lender.

Notices to Lender. Grantor will promptly notify Lender in
writing at Lender's address shown above (or such other addresses
as Lender may designate from time to time) prior to any
(1) change in Grantor's name; (2) change in Grantor's assumed
business name(s); (3) change in the management of the Corporation
Grantor; (4) change in the authorized signer(s); (5) change in
Grantor's principal office address; (6) change in Grantor's state
of organization; (7) conversion of Grantor to a new or different
type of business entity; or (8) change in any other aspect of
Grantor that directly or indirectly relates to any agreements
between Grantor and Lender. No change in Grantor's name or state
of organization will take effect until after Lender has received
notice.

No Violation. The execution and delivery of this Agreement will
not violate any law or agreement governing Grantor or to which
Grantor is a party, and its certificate or articles of
incorporation and bylaws do not prohibit any term or condition
of this Agreement.

Enforceability of Collateral. To the extent the Collateral consists
of accounts, chattel paper, or general intangibles, as defined by
the Uniform Commercial Code, the Collateral is enforceable in
accordance with its terms, is genuine, and fully complies with
all applicable laws and regulations concerning form, content and
 manner of preparation and execution, and all persons appearing
to be obligated on the Collateral have authority and capacity to
contract and are in fact obligated as they appear to be on the
Collateral. There shall be no setoffs or counterclaims against
any of the Collateral, and no agreement shall have been made
under which any deductions or discounts may be claimed concerning
the Collateral except those disclosed to Lender in writing.

Location of the Collateral. Except in the ordinary course of
Grantor's business, Grantor agrees to keep the Collateral at
Grantor's address shown above or at such other locations as are
acceptable to Lender. Upon Lender's request, Grantor will
deliver to Lender in form satisfactory to Lender a schedule of
real properties and Collateral locations relating to Grantor's
operations, including without limitation the following: (1} all
real property Grantor owns or is purchasing; (2) all real
property Grantor is renting or leasing; (3) all storage
facilities Grantor owns, rents, leases, or uses; and (4) all
other properties where Collateral is or may be located.

Removal of the Collateral. Except in the ordinary course of
Grantor's business, Grantor shall not remove the Collateral
from its existing location without Lender's prior written
consent. Grantor shall, whenever requested, advise Lender of
the exact location of the Collateral.

Transactions Involving Collateral. Except for inventory sold or
accounts collected in the ordinary course of Grantor's business,
or as otherwise provided for in this Agreement, Grantor shall not
sell, offer to sell, or otherwise transfer or dispose of the
Collateral. Grantor shall not pledge, mortgage, encumber or
otherwise permit the Collateral to be subject to any lien,
security interest, encumbrance, or charge, other than the
security interest provided for in this Agreement, without the
prior written consent of Lender. This includes security interests
even if junior in right to the security interests granted under
this Agreement. Unless waived by Lender, all proceeds from any
disposition of the Collateral (for whatever reason) shall be held
in trust for Lender and shall not be commingled with any other
funds; provided however, this requirement shall not constitute
consent by Lender to any sale or other disposition. Upon receipt,
Grantor shall immediately deliver any such proceeds to Lender.

Title. Grantor represents and warrants to Lender that Grantor
holds good and marketable title to the Collateral, free and clear
of all liens and encumbrances except for the lien of this Agreement.
No financing statement covering any of the Collateral is on file in
any public office other than those which reflect the security
interest created by this Agreement or to which Lender has
specifically consented. Grantor shall defend Lender's rights in
the Collateral against the claims and demands of all other persons.

Repairs and Maintenance. Grantor agrees to keep and maintain,
and to cause others to keep and maintain, the Collateral in good
order, repair and condition at all times while this Agreement
remains in effect. Grantor further agrees to pay when due all
claims for work done on, or services rendered or material
furnished in connection with the Collateral so that no lien or
encumbrance may ever attach to or be filed against the Collateral.

Inspection of Collateral.  Lender and Lender's designated
representatives and agents shall have the right at all reasonable
times to examine and inspect the Collateral wherever located.

Taxes, Assessments and Liens. Grantor will pay when due all taxes,
assessments and liens upon the Collateral, its use or operation,
upon this Agreement, upon any promissory note or notes evidencing
the Indebtedness, or upon any of the other Related Documents.
Grantor may withhold any such payment or may elect to contest
any lien if Grantor is in good faith conducting an appropriate
proceeding to contest the obligation to pay and so long as
Lender's interest in the Collateral Is not jeopardized in
Lender's sole opinion. If the Collateral is subjected to a lien
which is not Lender in an amount adequate to provide for the
discharge of the lien plus any interest, costs, attorneys' fees
or other charges that could accrue as a result of foreclosure or
sale of the Collateral. In any contest Grantor shall defend
itself and Lender and shall satisfy any final adverse judgment
before enforcement against the Collateral Grantor shall name
Lender as an additional obliges under any surety bond furnished
in the contest proceedings. Grantor further agrees to furnish
Lender with evidence that such taxes, assessments, and
governmental and other charges have been paid in full and in a
timely manner. Grantor may withhold any such payment or may
elect to contest any lien if Grantor is in good faith conducting
an appropriate proceeding to contest the obligation to pay and
so long as Lender's interest in the Collateral is not jeopardized.

Compliance with Governmental Requirements. Grantor shall comply
promptly with all laws, ordinances, rules and regulations of all
governmental authorities, now or hereafter in effect, applicable
to the ownership, production, disposition, or use of the Collateral,
including all laws or regulations relating to the undue erosion
of highly-erodible land or relating to the conversion of wetlands
for the production of an agricultural product or commodity. Grantor
may contest in good faith any such law, ordinance or regulation
and withhold compliance during any proceeding, including
appropriate appeals, so long as Lender's interest in the
Collateral, in Lender's opinion, is not jeopardized.

Hazardous Substances. Grantor represents and warrants that the
Collateral never has been, and never will be so long as this
Agreement remains a lien on the Collateral, used in violation of
any Environmental Laws or for the generation, manufacture,
storage, transportation, treatment, disposal, release or
threatened release of any Hazardous Substance. The representations
and warranties contained herein are based on Grantor's due
diligence in investigating the Collateral for Hazardous
Substances. Grantor hereby (1) releases and waives any future
claims against Lender for indemnity or contribution in the event
Grantor becomes liable for cleanup or other costs under any
Environmental Laws, and (2) agrees to indemnify and hold
harmless Lender against any and all claims and losses resulting
from a breach of this provision of this Agreement. This
obligation to indemnify shall survive the payment of the
Indebtedness and the satisfaction of this Agreement.

Maintenance of Casualty Insurance. Grantor shall procure and
maintain all risks insurance, including without limitation fire,
theft and liability coverage together with such other insurance
as Lender may require with respect to the Collateral, in form,
amounts, coverages and basis reasonably acceptable to Lender and
issued by a company or companies reasonably acceptable to Lender.
Grantor, upon request of Lender, will deliver to Lender from time
to time the policies or certificates of insurance in form
satisfactory to Lender, including stipulations that coverages
will not be cancelled or diminished without at least ten (10)
days' prior written notice to Lender and not including any
disclaimer of the insurer's liability for failure to give such a
notice. Each insurance policy also shall include an endorsement
providing that coverage in favor of Lender will not be impaired
in any way by any act, omission or default of Grantor or any
other person. In connection with all policies covering assets
in which Lender holds or is offered a security interest, Grantor
will provide Lender with such loss payable or other endorsements
as Lender may require. If Grantor at any time fails to obtain or
maintain any insurance as required under this Agreement, Lender
may (but shall not be obligated to) obtain such insurance as
Lender deems appropriate, including if Lender so chooses "single
interest insurance," which will cover only Lender's interest in
the Collateral.

Application of Insurance Proceeds. Grantor shall promptly notify
Lender of any loss or damage to the Collateral. Lender may make
proof of loss if Grantor fails to do so within fifteen (15) days
of the casualty. All proceeds of any insurance on the Collateral,
including accrued proceeds thereon, shall be held by Lender as
part of the Collateral. If Lender consents to repair or
replacement of the damaged or destroyed Collateral, Lender
shall, upon satisfactory proof of expenditure, pay or reimburse
Grantor from the proceeds for the reasonable cost of repair or
restoration. If Lender does not consent to repair or replacement
of the Collateral, Lender shall retain a sufficient amount of
the proceeds to pay all of the Indebtedness, and shall pay the
balance to Grantor. Any proceeds which have not been disbursed
within six (6) months after their receipt and which Grantor
has not committed to the repair or restoration of the Collateral
 shall be used to prepay the Indebtedness.

Insurance Reserves. Lender may require Grantor to maintain with
Lender reserves for payment of insurance premiums, which reserves
shall be created by monthly payments from Grantor of a sum
estimated by Lender to be sufficient to produce, at least fifteen
(15) days before the premium due date, amounts at least equal to
the insurance premiums to be paid. If fifteen (15) days before
payment is due, the reserve funds are insufficient, Grantor shall
upon demand pay any deficiency to Lender. The reserve funds shall
be held by Lender as a general deposit and shall constitute a
non-interest-bearing account which Lender may satisfy by payment
of the insurance premiums required to be paid by Grantor as they
become due. Lender does net hold the reserve funds in trust for
Grantor, and Lender is not the agent of Grantor for payment of
the insurance premiums required to be paid by Grantor. The
responsibility for the payment of premiums shall remain
Grantor's sole responsibility.

Insurance Reports. Grantor, upon request of Lender, shall furnish
to Lender reports on each existing policy of insurance showing
such information as Lender may reasonably request including the
following: (1) the name of the insurer; (2) the risks insured;
(3) the amount of the policy; (4) the property insured; (5) the
then current value on the basis of which insurance has been
obtained and the manner of determining that value; and (6) the
expiration date of the policy. In addition, Grantor shall upon
request by Lender (however not more often than annually) have an
independent appraiser satisfactory to Lender determine, as
applicable, the cash value or replacement cost of the Collateral.

Financing Statements. Grantor authorizes Lender to file a UCC
financing statement, or alternatively, a copy of this Agreement
to perfect Lender's security interest. At Lender's request,
Grantor additionally agrees to sign all other documents that are
necessary to perfect, protect, and continue Lender's security
interest in the properly. Grantor will pay all filing fees, title
transfer fees, and ether fees and costs involved unless prohibited
by law or unless Lender is required by law to pay such fees and
costs. Grantor irrevocably appoints Lender to execute documents
necessary to transfer title if there is a default. Lender may file
a copy of this Agreement as a financing statement. If Grantor
changes Grantor's name or address, or the name or address of any
person granting a security interest under this Agreement
changes, Grantor will promptly notify the Lender of such change.

GRANTOR'S RIGHT TO POSSESSION. Until default, Grantor may have
possession of the tangible personal property and beneficial use
of all the Collateral and may use it in any lawful manner not
inconsistent with this Agreement or the Related Documents, provided
that Grantor's right to possession and beneficial use shall not
apply to any Collateral where possession of the Collateral by
Lender is required by law to perfect Lender's security interest
in such Collateral. If Lender at any time has possession of any
Collateral, whether before or alter an Event of Default, Lender
shall be deemed to have exercised reasonable care in the custody
and preservation of the Collateral if Lender takes such action
for that purpose as Grantor shall request or as Lender, in Lender's
sole discretion, shall deem appropriate under the circumstances,
but failure to honor any request by Grantor shall not of itself
be deemed to be a failure to exercise reasonable care. Lender
shall not be required to take any steps necessary to preserve
any rights in the Collateral against prior parties, nor to
protect, preserve or maintain any security interest given to
secure the Indebtedness.

LENDER'S EXPENDITURES. If any action or proceeding is commenced
that would materially affect Lender's interest in the Collateral
or if Grantor fails to comply with any prevision of this
Agreement or any Related Documents, including but not limited to
Grantor's failure to discharge or pay when due any amounts Grantor
is required to discharge or pay under this Agreement or any
Related Documents, Lender on Grantor's behalf may (but shall
not be obligated to) take any action that Lender deems
appropriate, including but not limited to discharging or
paying all taxes, liens, security interests, encumbrances
and other claims, at any time levied or placed on the Collateral
and paying all costs for insuring, maintaining and preserving
the Collateral. All such expenditures incurred or paid by
Lender for such purposes will then bear interest at the rate
charged under the Note from the date incurred or paid by Lender
to the date of repayment by Grantor. All such expenses will
become a part of the Indebtedness and, at Lender's option,
will (A) be payable on demand; (B) be added to the balance
of the Note and be apportioned among and be payable with any
installment payments to become due during either (1) the term
of any applicable insurance policy; or (2) the remaining term
of the Note; or (C) be treated as a balloon payment which will
 be due and payable at the Note's maturity. The Agreement also
will secure payment of these amounts. Such right shall be in
addition to all other rights and remedies to which Lender may
 be entitled upon Default.

DEFAULT. Each of the following shall constitute an Event of
Default under this Agreement:

Payment Default. Grantor fails to make any payment when due
under the Indebtedness.

Other Defaults. Grantor fails to comply with or to perform any
other term, obligation, covenant or condition contained in this
Agreement or in any of the Related Documents or to comply with
or to perform any term, obligation, covenant or condition
contained in any other agreement between Lender and Grantor.

Default in Favor of Third Parties. Should Borrower or any Grantor
default under any loan, extension of credit, security agreement,
purchase or sales agreement, or any other agreement, in favor of
any other creditor or person that may materially affect any of
Grantor's property or Grantor's or any Grantor's ability to repay
the Indebtedness or perform their respective obligations under
this Agreement or any of the Related Documents.

False Statements. Any warranty, representation or statement made
or furnished to Lender by Grantor or on Grantor's behalf under
this Agreement or the Related Documents is false or misleading
in any material respect, either now or at the time made or
furnished or becomes false or misleading at any time thereafter.

Defective Collateralization This Agreement or any of the Related
Documents ceases to be in full force and effect (including failure
of any collateral document to create a valid and perfected security
interest or lien) at any time and for any reason.

Insolvency. The dissolution or termination of Grantor's existence
as a going business, the insolvency of Grantor, the appointment
of a receiver for any part of Grantor's property, any assignment
for the benefit of creditors, any type of creditor workout, or
the commencement of any proceeding under any bankruptcy or
insolvency laws by or against Grantor.

Creditor or Forfeiture Proceedings. Commencement of foreclosure
or forfeiture proceedings, whether by judicial proceeding,
self-help, and if Grantor gives Lender written notice of the
creditor or forfeiture proceeding and deposits with Lender monies
or a surety bond for the creditor or forfeiture proceeding, in an
amount determined by Lender, in its sole discretion, as being an
adequate reserve or bond for the dispute.

Events Affecting Guarantor. Any of the preceding events occurs
with respect to any guarantor, endorser, surety, or accommodation
party of any of the Indebtedness or guarantor, endorser, surety,
or accommodation party dies or becomes incompetent or revokes or
disputes the validity of, or liability under, any Guaranty of the
Indebtedness.

Adverse Change. A material adverse change occurs in Grantor's
financial condition, or Lender believes the prospect of payment
or performance of the indebtedness is impaired.

Insecurity. Lender in good faith believes itself insecure.

RIGHTS AND REMEDIES ON DEFAULT. If an Event of Default occurs
under this Agreement, at any time thereafter, Lender shall have
all the rights of a secured party under the Colorado Uniform
Commercial Code. In addition and without limitation, Lender may
exercise any one or more of the following rights and remedies:

Accelerate Indebtedness. Lender may declare the entire
indebtedness, including any prepayment penalty which Grantor
would be required to pay, immediately due and payable, without
notice of any kind to Grantor.

Assemble Collateral. Lender may require Grantor to deliver to
Lender all or any portion of the Collateral and any and all
certificates of title and other documents relating to the
Collateral. Lender may require Grantor to assemble the Collateral
and make it available to Lender at a place to be designated by
Lender. Lender also shall have full power to enter upon the
property of Grantor to take possession of and remove the
Collateral. If the Collateral contains other goods not covered
by this Agreement at the time of repossession, Grantor agrees
Lender may take such other goods, provided that Lender makes
reasonable efforts to return them to Grantor after repossession.

Sell the Collateral. Lender shall have full power to sell, lease,
transfer, or otherwise deal with the Collateral or proceeds
thereof in Lender's own name or that of Grantor. Lender may sell
the Collateral at public auction or private sale. Unless the
Collateral threatens to decline speedily in value or is of a
type customarily sold on e recognized market, Lender will give
Grantor, and other persons as required by law, reasonable notice
of the time and place of any public sale, or the time after which
any private sale or any other disposition of the Collateral is to
be made. However, no notice need be provided to any person who,
after Event of Default occurs, enters into and authenticates an
agreement waiving that person's right to notification of sale.
The requirements of reasonable notice shall be met if such notice
is given at least ten (10) days before the time of the sale or
disposition. All expenses relating to the disposition of the
Collateral, including without limitation the expenses of
retaking, holding, insuring, preparing for sale and selling
the Collateral, shall become a part of the Indebtedness secured
by this Agreement and shall be payable on demand, with interest
at the Note rate from date of expenditure until repaid.

Appoint Receiver. Lender shall have the right to have a receiver
appointed to take possession of all or any part of the Collateral,
with the power to protect and preserve the Collateral, to operate
the Collateral preceding foreclosure or sale, and to collect the
Rents from the Collateral and apply the proceeds, over and above
the cost of the receivership, against the Indebtedness. The receiver
may serve without bond if permitted by law. Lender's right to the
appointment of a receiver shall exist whether or not the apparent
value of the Collateral exceeds the Indebtedness by a substantial
amount. Employment by Lender shall not disqualify a person from
serving as a receiver. Receiver may be appointed by a court of
competent jurisdiction upon ex parte application and without
notice, notice being expressly waived.

Collect Revenues, Apply Accounts. Lender, either itself or
through a receiver, may collect the payments, rents, income, and
revenues from the Collateral. Lender may at any time in Lender's
discretion transfer any Collateral into Lender's own name or that
of Lender's nominee and receive the payments, rents, income, and
revenues therefrom and hold the same as security for the
Indebtedness or apply it to payment of the indebtedness in such
order of preference as Lender may determine. Insofar as the
Collateral consists of accounts, general intangibles, insurance
policies, instruments, chattel paper, chooses in action, or
similar property, Lender may demand, collect, receipt for,
settle, compromise, adjust, sue for, foreclose, or realize on
the Collateral as Lender may determine, whether or not
Indebtedness or Collateral is then due. For these purposes,
Lender may, on behalf of and in the name of Grantor, receive,
open and dispose of mail addressed to Granter; change any
address to which mail and payments are to be sent; and endorse
notes, checks, drafts, money orders, documents of title,
instruments and items pertaining to payment, shipment, or
storage of any Collateral. To facilitate collection, Lender
may notify account debtors and obligors on any Collateral to
make payments directly to Lender.

Obtain Deficiency. If Lender chooses to sell any or all of the
Collateral, Lender may obtain a judgment against Grantor for
any deficiency remaining on the indebtedness due to Lender
after application of all amounts received from the exercise
of the rights provided in this Agreement. Grantor shall be
liable for a deficiency even if the transaction described in
this subsection is a sale of accounts or chattel paper.

Other Rights and Remedies. Lender shall have all the rights and
remedies of a secured creditor under the provisions of the
Uniform Commercial Code, as may be amended from time to time.
In addition, Lender shall have and may exercise any or all
other rights and remedies it may have available at law, in
equity, or otherwise.

Election of Remedies. Except as may be prohibited by applicable
law, all of Lender's rights and remedies, whether evidenced by
this Agreement, the Related Documents, or by any other writing,
shall be cumulative and may be exercised singularly or
concurrently. Election by Lender to pursue any remedy shall not
exclude pursuit of any other remedy, and an election to make
expenditures or to take action to perform an obligation of
Grantor under this Agreement, after Grantor's failure to perform,
shall not affect Lender's right to declare a default and exercise
its remedies.

MISCELLANEOUS PROVISIONS. The following miscellaneous provisions
are a part of this Agreement:

Amendments. This Agreement, together with any Related Documents,
constitutes the entire understanding and agreement of the parties
as to the matters set forth in this Agreement.  No alteration of or
amendment to this Agreement shall be effective unless given in
writing and signed by the party or parties sought to be charged or
bound by the alteration or amendment.

Attorneys' Fees; Expenses. Grantor agrees to pay upon demand all
of Lender's reasonable costs and expenses, including Lender's
attorneys' fees and Lender's legal expenses, incurred in
connection with the enforcement of this Agreement. Lender may
hire or pay someone else to help enforce this Agreement, and
Grantor shall pay the reasonable costs and expenses of such
enforcement. Costs and expenses include Lender's attorneys'
fees and legal expenses whether or not there is a lawsuit,
including attorneys' fees and legal expenses for bankruptcy
proceedings (including efforts to modify or vacate any automatic
 stay or injunction), appeals, and any anticipated post-judgment
collection services. Grantor also shall pay all court costs and
such additional fees as may be directed by the court.

Caption Headings. Caption headings in this Agreement are for
convenience purposes only and are not to be used to interpret
or define the provisions of this Agreement.

Governing Law. This Agreement will be governed by, construed
and enforced In accordance with federal law and the laws of
the State of Colorado. This Agreement has been accepted by
Lender in the State of Colorado.

No Waiver by Lender. Lender shall not be deemed to have waived
any rights under this Agreement unless such waiver is given in
writing and signed by Lender. No delay or omission on the part
of Lender in exercising any right shall operate as a waiver of
such right or any other right. A waiver by Lender of a provision
of this Agreement shall not prejudice or constitute a waiver of
Lender's right otherwise to demand strict compliance with that
provision or any other provision of this Agreement. No prior
waiver by Lender, nor any course of dealing between Lender and
Grantor, shall constitute a waiver of any of Lender's rights or
of any of Grantor's obligations as to any future transactions.
Whenever the consent of Lender is required under this Agreement,
the granting of such consent by Lender in any instance shall not
constitute continuing consent to subsequent instances where such
consent is required and in all cases such consent may be granted
or withheld in the sole discretion of Lender.

Notices. Any notice required to be given under this Agreement
shall be given in writing, end shall be effective when actually
delivered, when actually received by telefacsimile (unless
otherwise required by law), when deposited with a nationally
recognized overnight courier, or, if mailed, when deposited in
the United States mail, as first class, certified or registered
mail postage prepaid, directed to the addresses shown near the
beginning of this Agreement. Any party may change its address
or notices under this Agreement by giving formal written notice
to the other parties, specifying that the purpose of the notice is
to change the party's address. For notice purposes, Grantor agrees
to keep Lender informed at all times of Grantor's current address.
Unless otherwise provided or required by law, if there is more
than one Grantor, any notice given by Lender to any Grantor is
deemed to be notice given to all Grantors.

Power of Attorney. Grantor hereby appoints Lender as Grantor's
irrevocable attorney-in-fact for the purpose of executing any
documents necessary to perfect, amend, or to continue the security
interest granted in this Agreement or to demand termination of
filings of other secured parties. Lender may at any time, and
without further authorization from Grantor, file a carbon,
photographic or other reproduction of any financing statement
or of this Agreement for use as a financing statement. Grantor
will reimburse Lender for all expenses for the perfection and
the continuation of the perfection of Lender's security interest
in the Collateral.

Severability. If a court of competent jurisdiction finds any
provision of this Agreement to be illegal, invalid, or
unenforceable as to any circumstance, that finding shall not
make the offending provision illegal, invalid, or unenforceable
as to any other circumstance. If feasible, the of this Agreement
shall not affect the legality, validity or enforceability of any
other provision of this Agreement.

Successors and Assigns. Subject to any limitations stated in this
Agreement on transfer of Grantor's interest, this Agreement shall
be binding upon and inure to the benefit of the parties, their
successors and assigns. If ownership of the Collateral becomes
vested in a person other than Grantor, Lender, without notice to
Grantor, may deal with Grantor's successors with reference to
this Agreement and the Indebtedness by way of forbearance or
extension without releasing Granter from the obligations of this
Agreement or liability under the Indebtedness.

Survival of Representations and Warranties. All representations,
warranties, and agreements made by Grantor in this Agreement shall
survive the execution and delivery of this Agreement, shall be
continuing in nature, and shall remain in full force and effect
until such time as Grantor's Indebtedness shall be paid in full.

Time is of the Essence. Time is of the essence in the performance
of this Agreement.

DEFINITIONS. The following capitalized words and terms shall have
the following meanings when used in this Agreement. Unless
specifically stated to the contrary, all references to dollar
amounts shall mean amounts in lawful money of the United States
of America. Words and terms used in the singular shall include
the plural, and the plural shall include the singular, as the
context may require. Words and terms not otherwise defined in
this Agreement shall have the meanings attributed to such terms
in the Uniform Commercial Code:

Agreement. The word "Agreement" means this Commercial Security
Agreement, as this Commercial Security Agreement may be amended
or modified from time to time, together with all exhibits and
schedules attached to this Commercial Security Agreement from
time to time. Borrower. The word "Borrower" means Scott's Liquid
Gold-Inc. and includes all co-signers and co-makers signing
the Note.

Collateral. The word "Collateral" means all of Grantor's right,
title and interest in and to all the Collateral as described in
the Collateral Description section of this Agreement.

Default. The word "Default" means the Default set forth in this
Agreement in the section titled "Default".

Environmental Laws. The words "Environmental Laws" mean any and
all state, federal and local statutes, regulations and ordinances
relating to the protection of human health or the environment,
including without limitation the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as amended,
42 U.S.C. Section 9601, et seq. ("CERCLA"), the Superfund
Amendments and Reauthorization Act of 1986, Pub. L. No. 99-499
("SARA"), the Hazardous Materials Transportation Act, 49 U.S.C.
Section 1801, et seq., the Resource Conservation and Recovery
Act, 42 U.S.C. Section 6901, et seq., or other applicable state
or federal laws, rules, or regulations adopted pursuant thereto.

Event of Default. The words "Event of Default" mean any of the
events of default set forth in this Agreement in the default
section of this Agreement.

Grantor. The word "Grantor" means Scott's Liquid Gold-Inc..

Guaranty. The word "Guaranty" means the guaranty from guarantor,
endorser, surety, or accommodation party to Lender, including
without limitation a guaranty of all or part of the Note.

Hazardous Substances. The words "Hazardous Substances" mean
materials that, because of their quantity, concentration or
physical, chemical or infectious characteristics, may cause or
pose a present or potential hazard to human health or the
environment when improperly used, treated, stored, disposed of,
generated, manufactured, transported or otherwise handled. The
words "Hazardous Substances" are used in their very broadest
sense and include without limitation any and all hazardous or
toxic substances, materials or waste as defined by or listed
under the Environmental Laws. The term "Hazardous Substances"
also includes, without limitation, petroleum and petroleum
by-products or any fraction thereof and asbestos.

Indebtedness. The word "Indebtedness" means the indebtedness
evidenced by the Note or Related Documents, including all
principal and interest together with all other indebtedness and
costs and expenses for which Grantor is responsible under this
Agreement or under any of the Related Documents.

Lender. The word "Lender" means Citywide Banks, its successors
and assigns.

Note. The word "Note" means the Note executed by Scott's Liquid
Gold-Inc. in the principal amount of $1,800,000.00 dated August 8,
2005, together with all renewals of, extensions of, modifications
of, refinancings of, consolidations of, and substitutions for the
note or credit agreement. Property. The word "Property" means all
of Grantor's right, title and interest in and to all the Property
as described in the "Collateral Description" section of this
Agreement.

Property.  The word "Property" means all of Grantor's right, title
and interest in and to all the Property as described in "Collateral
Description" section of this Agreement.

Related Documents. The words "Related Documents" mean all
promissory notes, credit agreements, loan agreements, environmental
agreements, guaranties, security agreements, mortgages, deeds of
trust, security deeds, collateral mortgages, and all other
instruments, agreements and documents, whether now or hereafter
existing, executed in connection with the Indebtedness.

GRANTOR HAS READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS
COMMERCIAL SECURITY AGREEMENT AND AGREES TO ITS TERMS. THIS
AGREEMENT IS DATED AUGUST 8 2005.

GRANTOR:

SCOTT'S LIQUID GOLD-INC.

By:   /s/ Jeffry B. Johnson
      ----------------------------
      Jeffry B. Johnson, C.F.O. &
       Treasurer of Scott's Liquid Gold-Inc.

EX-31

									EXHIBIT 31.1

CERTIFICATION

I, Mark E. Goldstein, certify that:

1.	I have reviewed this quarterly report on Form 10-Q for the
quarter ended June 30, 2005 of Scott's Liquid Gold-Inc.;

2.	Based on my knowledge, this report does not contain any
untrue statement of a material fact or omit to state a material
fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not
misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements and other
financial information included in this report, fairly present in
all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for,
the periods presented in this report;

4.	The registrant's other certifying officer(s) and I are
responsible for establishing and maintaining disclosure controls
and procedures (as defined in Exchange Act Rules 13a-15(e) and
15d-15(e)) for the registrant and have:

a)	designed such disclosure controls and procedures, or caused
such disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the
registrant, including its consolidated subsidiaries, is made
known to us by others within those entities, particularly during
the period in which this report is being prepared;

b)	evaluated the effectiveness of the registrant's disclosure
 controls and procedures and presented in this report our
conclusions about the effectiveness of the disclosure controls
and procedures, as of the end of the period covered by this report
based on such evaluation; and

(c)	disclosed in this report any change in the registrant's
internal control over financial reporting that occurred during the
registrant's most recent fiscal quarter (the registrant's fourth
fiscal quarter in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting; and

5.	The registrant's other certifying officer(s) and I have
disclosed, based on our most recent evaluation of internal control
over financial reporting, to the registrant's auditors and the
audit committee of registrant's board of directors (or persons
performing the equivalent functions):

a)	all significant deficiencies and material weaknesses in the
design or operation of internal control over financial reporting
which are reasonably likely to adversely affect the registrant's
ability to record, process, summarize and report financial
information; and

b)	any fraud, whether or not material, that involves management
or other employees who have a significant role in the registrant's
internal control over financial reporting.



DATED:  August 10, 2005

                              /s/ Mark E. Goldstein
                              ------------------------------------
                             Mark E. Goldstein
                              President, Chief Executive Officer,
                               and Chairman of the Board
                              Principal Executive Officer

EX-31

									EXHIBIT 31.2

CERTIFICATION

I, Jeffry B. Johnson, certify that:

1.	I have reviewed this quarterly report on Form 10-Q for the
quarter ended June 30, 2005 of Scott's Liquid Gold-Inc.;

2.	Based on my knowledge, this report does not contain any
untrue statement of a material fact or omit to state a material
fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not
misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements and other
financial information included in this report, fairly present in
all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for, the
periods presented in this report;

4.	The registrant's other certifying officer(s) and I are
responsible for establishing and maintaining disclosure controls
and procedures (as defined in Exchange Act Rules 13a-15(e) and
15d-15(e)) for the registrant and have:

a)	designed such disclosure controls and procedures, or caused
such disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the
registrant, including its consolidated subsidiaries, is made
known to us by others within those entities, particularly during
the period in which this report is being prepared;

b)	evaluated the effectiveness of the registrant's disclosure
controls and procedures and  presented in this report our
conclusions about the effectiveness of the disclosure controls
and procedures, as of the end of the period covered by this report
based on such evaluation; and

(c)	disclosed in this report any change in the registrant's
internal control over financial reporting that occurred during
the registrant's most recent fiscal quarter (the registrant's
fourth fiscal quarter in the case of an annual report) that has
materially affected, or is reasonably likely to materially
affect, the registrant's internal control over financial
reporting; and

5.	The registrant's other certifying officer(s) and I have
disclosed, based on our most recent evaluation of internal control
over financial reporting, to the registrant's auditors and the
audit committee of registrant's board of directors (or persons
performing the equivalent functions):

a)	all significant deficiencies and material weaknesses in the
design or operation of internal control over financial reporting
which are reasonably likely to adversely affect the registrant's
ability to record, process, summarize and report financial
information; and

b)	any fraud, whether or not material, that involves management
or other employees who have a significant role in the registrant's
internal control over financial reporting.

DATED:  August 10, 2005

                             /s/ Jeffry B. Johnson
                             --------------------------------------
                             Jeffry B. Johnson
                             Treasurer and Chief Financial Officer
                              Principal Financial Officer

EX-32

                                                   EXHIBIT 32.1

                      CERTIFICATION OF 10-Q REPORT
                                   OF
                        SCOTT'S LIQUID GOLD-INC.

                     FOR THE QUARTER JUNE 30, 2005

1.   The undersigned are the Chief Executive Officer and the Chief
Financial Officer of Scott's Liquid Gold-Inc. ("Scott's Liquid Gold").
This Certification is made pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.  This Certification accompanies the
10-Q Report of Scott's Liquid Gold for the quarter ended June 30, 2005.

2.   We certify that such 10-Q Report fully complies with the
requirements of Section 13(a) or 15(d) of the Securities Exchange
Act of 1934 and that the information contained in such 10-Q Report
 fairly presents, in all material respects, the financial condition
and results of operations of Scott's Liquid Gold.

This Certification is executed as of August 10, 2005.


/s/ Mark E. Goldstein
- -----------------------------------
Mark E. Goldstein
President, Chief Executive Officer
 and Chairman of the Board
Principal Executive Officer


/s/ Jeffry B. Johnson
- -----------------------------------
Jeffry B. Johnson
Treasurer and Chief Financial Officer
Principal Financial Officer