<PAGE>   1

                                                                     EXHIBIT 4.9
Record and return to:
Baker Botts LLP
2001 Ross Avenue, Suite 600
Dallas, Texas  75201
Attention:  R. Christian Brose, Esq.

===============================================================================


              STERLING PULP CHEMICALS, INC., a Debtor-in-Possession

                                    Grantor,

                                       to

          THE CIT GROUP/BUSINESS CREDIT, INC., as Administrative Agent

                                       and

                                    , as Georgia co-agent
                          ----------

                                   ----------

  CURRENT ASSETS SECURED PARTIES LEASEHOLD DEED TO SECURE DEBT, ASSIGNMENT AND
                               SECURITY AGREEMENT

                                   ----------

                           Dated as of July 19, 2001

           This instrument affects certain real and personal property
                           located in Lowndes County,
                                State of Georgia.



This instrument was prepared by the above named attorney.
Notice:  This instrument contains inter alia obligations which may provide for:

                  (a)      a variable rate of interest and/or

                  (b)      future and/or revolving credit advances or
                           readvances, which when made, shall have the same
                           priority as advances or readvances made on the date
                           hereof whether or not (i) any advances or readvances
                           were made on the date hereof and (ii) any
                           indebtedness is outstanding at the time any advance
                           or re-advance is made.


<PAGE>   2


                                TABLE OF CONTENTS

<Table>
<Caption>
                                                                                      Page
                                                                                      ----
<S>              <C>                                                                <C>
SECTION 1.1.     Payment of Secured Obligations.....................................I-2-B-5
SECTION 1.2.     Title to Collateral, etc...........................................I-2-B-5
SECTION 1.3.     Intentionally Omitted..............................................I-2-B-6
SECTION 1.4.     Recordation........................................................I-2-B-6
SECTION 1.5.     Payment of Impositions, etc........................................I-2-B-7
SECTION 1.6.     Insurance and Legal Requirements...................................I-2-B-7
SECTION 1.7.     Security Interests, etc............................................I-2-B-7
SECTION 1.8.     Permitted Contests.................................................I-2-B-8
SECTION 1.9.     Leases.............................................................I-2-B-8
SECTION 1.10.    Compliance with Instruments........................................I-2-B-8
SECTION 1.11.    Maintenance and Repair, etc........................................I-2-B-9
SECTION 1.12.    Alterations, Additions, etc........................................I-2-B-9
SECTION 1.13.    Acquired Property Subject to Security Title/Security Interest......I-2-B-9
SECTION 1.14.    Assignment of Rents, Proceeds. etc.................................I-2-B-9
SECTION 1.15.    No Claims Against the Grantee.....................................I-2-B-10
SECTION 1.16.    Indemnification...................................................I-2-B-11
SECTION 1.17.    No Credit for Payment of Taxes....................................I-2-B-12
SECTION 1.18.    Intentionally Omitted.............................................I-2-B-12
SECTION 1.19.    No Transfer of the Property.......................................I-2-B-12
SECTION 1.20.    Security Agreement................................................I-2-B-12
SECTION 1.21.    Representations and Warranties....................................I-2-B-13
SECTION 1.22.    Grantor's Covenants...............................................I-2-B-13
SECTION 1.23.    Attornment........................................................I-2-B-13
SECTION 2.1.     Insurance.........................................................I-2-B-13
SECTION 2.1.1.   Risks to be Insured...............................................I-2-B-13
SECTION 2.1.2.   Policy Provisions.................................................I-2-B-14
SECTION 2.1.3.   Delivery of Policies, etc.........................................I-2-B-15
SECTION 2.1.4.   Separate Insurance................................................I-2-B-15
SECTION 2.2.     Damage, Destruction or Taking; Grantor to Give Notice;
                 Assignment of Awards..............................................I-2-B-15
SECTION 2.3.     Application of Proceeds and Awards................................I-2-B-16
SECTION 2.4.     Total Taking and Total Destruction................................I-2-B-17
SECTION 3.1.     Events of Default; Acceleration...................................I-2-B-17
SECTION 3.2.     Legal Proceedings; Judicial Foreclosure...........................I-2-B-17
SECTION 3.3      Power of Sale.....................................................I-2-B-17
SECTION 3.4.     Uniform Commercial Code Remedies..................................I-2-B-18
SECTION 3.5.     Grantee Authorized to Execute Deeds, etc..........................I-2-B-19
SECTION 3.6.     Purchase of Collateral by Grantee.................................I-2-B-19
SECTION 3.7.     Receipt a Sufficient Discharge to Purchaser.......................I-2-B-19
SECTION 3.8.     Waiver of Appraisement. Valuation, etc............................I-2-B-19
SECTION 3.9.     Sale a Bar Against Grantor........................................I-2-B-19
SECTION 3.11.    Application of Proceeds of Sale and Other Moneys..................I-2-B-20
</Table>

                                        i

<PAGE>   3

<Table>


<S>              <C>                                                               <C>
SECTION 3.12.    Appointment of Receiver...........................................I-2-B-20
SECTION 3.14.    Right of Grantee to Perform Grantor's Covenants, etc..............I-2-B-21
SECTION 3.15.    Subrogation.......................................................I-2-B-21
SECTION 3.16.    Remedies, etc., Cumulative........................................I-2-B-22
SECTION 3.17.    Provisions Subject to Applicable Law..............................I-2-B-22
SECTION 3.18.    No Waiver, etc....................................................I-2-B-22
SECTION 3.19.    Compromise of Actions, etc........................................I-2-B-22
SECTION 3.20     Foreclosure - Authority Lease.....................................I-2-B-22
SECTION 4.1.     Terms Defined in this Deed........................................I-2-B-23
SECTION 4.2.     Use of Defined Terms..............................................I-2-B-24
SECTION 4.3.     Credit Agreement Definitions......................................I-2-B-25
SECTION 5.1.     Further Assurances; Financing Statements..........................I-2-B-25
SECTION 5.1.1.   Further Assurances................................................I-2-B-25
SECTION 5.1.2.   Financing Statements..............................................I-2-B-25
SECTION 5.2.     Additional Security...............................................I-2-B-25
SECTION 5.3.     Satisfaction; Partial Release, etc................................I-2-B-26
SECTION 5.3.1.   Satisfaction......................................................I-2-B-26
SECTION 5.3.2.   Partial Release, etc..............................................I-2-B-26
SECTION 5.4.     Notices, etc......................................................I-2-B-26
SECTION 5.5.     Waivers, Amendments, etc..........................................I-2-B-26
SECTION 5.6.     Cross-References..................................................I-2-B-26
SECTION 5.7.     Headings..........................................................I-2-B-27
SECTION 5.8.     Currency..........................................................I-2-B-27
SECTION 5.9.     Governing Law.....................................................I-2-B-27
SECTION 5.10.    Successors and Assigns. etc.......................................I-2-B-27
SECTION 5.11.    Waiver of Jury Trial; Submission to Jurisdiction..................I-2-B-27
SECTION 5.12.    Severability; Conflicts...........................................I-2-B-28
SECTION 5.13.    Loan Document.....................................................I-2-B-28
SECTION 5.14.    Usury Savings Clause..............................................I-2-B-28
SECTION 5.15.    Future Advances...................................................I-2-B-28
SECTION 5.16.    Co-Agent..........................................................I-2-B-29
SECTION 5.17.    Deed Subject to Revolver Intercreditor Agreement..................I-2-B-29
</Table>


                                       ii


<PAGE>   4

          CURRENT ASSETS SECURED PARTIES LEASEHOLD DEED TO SECURE DEBT,
                        ASSIGNMENT AND SECURITY AGREEMENT

         THIS CURRENT ASSETS SECURED PARTIES LEASEHOLD DEED TO SECURE DEBT,
ASSIGNMENT AND SECURITY AGREEMENT, dated as of July 19, 2001 (this "Deed"), made
by STERLING PULP CHEMICALS, INC., a Georgia corporation (the "Grantor"), having
an address at 1200 Smith Street, Suite 1900, Houston, Texas 77002-4312, to THE
CIT GROUP/BUSINESS CREDIT, INC. ("CIT"), having an address at 5420 LBJ Freeway,
Suite 200, Dallas, Texas 75240, as the Administrative Agent under the Credit
Agreement referred to below (together with its successors and assigns from time
to time acting as Administrative Agent for each of the Current Assets Secured
Parties under such Credit Agreement, the "Administrative Agent") and
______________________, a _______________ having an address at
______________________________________________, as Georgia co-agent (together
with its successors and assigns from time to time acting as Georgia co-agent and
the Administrative Agent, the "Grantee").

                                WITNESSETH THAT:

         WHEREAS, Grantor has elected to file a voluntary petition with the
United States Bankruptcy Court for the Southern District of Texas and has
continued in possession of its assets and in the management of its business
pursuant to Sections 1107 and 1108 of the Bankruptcy Code.

         WHEREAS, the Grantor is on the date of delivery hereof the owner of an
easement or leasehold estate as indicated herein or on Schedule 1 hereto to the
parcel of land (and any easements or other rights or interests) described in
Schedule 1 hereto (the "Land") and of the Improvements (such term and other
capitalized terms used in this Mortgage having the respective meanings specified
or referred to in Article IV);

         WHEREAS, pursuant to the terms, conditions and provisions of the
Revolving Credit Agreement, dated as of the date hereof (as amended, restated,
supplemented or otherwise modified from time to time, the "Credit Agreement'),
among Sterling Chemicals, Inc., Sterling Canada, Inc., Sterling Pulp Chemicals
U.S., Inc., Grantor, Sterling Fibers, Inc., Sterling Chemicals Energy, Inc. and
Sterling Chemicals International, Inc., as Borrowers (collectively, the
"Borrowers", the financial institutions from time to time parties thereto (the
"Lenders") and The CIT Group/Business Credit, Inc., as the Administrative Agent,
the Lenders and the Issuer have agreed, subject to the conditions and
limitations set forth therein, to make Loans to, and to issue Letters of Credit
for the account of, the Borrowers in the maximum original principal amount not
to exceed One Hundred Ninety-Five Million Dollars ($195,000,000) (such Loans and
Letters of Credit are hereinafter referred to collectively as the "Credit
Extensions").

         WHEREAS, the Credit Extensions consist of, inter alia, Current Assets
Loans in a maximum principal amount not to exceed One Hundred Twenty-Five
Million Dollars ($125,000,000) having a Maturity Date of the earlier to occur of
(i) the thirtieth (30th) day after the date of the entry of the Interim Order if
the Final Order has not been entered prior to such date (unless the Maturity
Date has been extended pursuant to Section 10.1(e)(i) of the Credit


                                    I-2-B-1
<PAGE>   5

Agreement), (ii) the date on which the Bankruptcy Court enters an order denying
approval of the transactions contemplated in the Credit Agreement, and (iii) the
second anniversary of the Effective Date (unless the Maturity Date has been
extended pursuant to Section 10.1(e)(i) of the Credit Agreement); and

         WHEREAS, the Grantor has duly authorized the execution, delivery and
performance of this Deed.

                                     GRANT:

         NOW, THEREFORE, for and in consideration of the premises, and of the
mutual covenants herein contained, and in order to induce the Current Assets
Lenders to make the Current Assets Loans pursuant to the Credit Agreement, and
in order to secure the full, timely and proper payment and performance of and
compliance with each and every one of the Secured Obligations (as hereinafter
defined), effective upon the entry of the Interim Order the Grantor hereby
irrevocably grants, bargains, sells, sets over, warrants, aliens, demises,
releases, hypothecates, pledges, assigns, transfers and conveys to the Grantee
and its successors, successors-in-title and assigns, forever, all of the
following (the "Collateral"):


                  (a) Real Estate. All of Grantor's estate, interest, rights,
         privileges and benefits (including, without limitation, any option to
         purchase fee simple title) existing under or created by that certain
         Indenture of Lease by and between Valdosta-Lowndes County Industrial
         Authority (as Lessor) and Sterling Pulp Chemicals US, Inc. (as Lessee)
         dated October 1, 1995, and recorded in Deed Book 1331, Page 27, Lowndes
         County, Georgia Records, with a Memorandum of Lease Agreement dated as
         of October 1, 1995, being recorded in Deed Book 1240, page 1, aforesaid
         records, as assigned by Sterling Pulp Chemicals US, Inc. to Grantor by
         instrument dated August 6, 1996, and recorded in Deed Book 1333, Page
         123, and re-recorded in Deed Book 1349, Page 83, aforesaid records
         (collectively, the "Authority Lease") covering and affecting the Land,
         and all of Grantor's interest in and to all of the Land and all
         additional lands and estates therein now owned or hereafter-acquired by
         the Grantor for use or development with the Land or any portion
         thereof, together with all and singular the tenements, rights,
         easements, hereditaments, rights of way, privileges, liberties,
         appendages and appurtenances now or hereafter belonging or in any way
         pertaining to the Land and such additional lands and estates therein
         (including, without limitation, all rights relating to storm and
         sanitary sewer, water, gas, electric, railway and telephone services);
         all development rights, air rights, riparian rights, water, water
         rights, water stock, all rights in, to and with respect to any and all
         oil, gas, coal, minerals and other substances of any kind or character
         underlying or relating to the Land and such additional lands and
         estates therein and any interest therein; all estate, claim, demand,
         right, title or interest of the Grantor in and to any street, road,
         highway or alley, vacated or other, adjoining the Land or any part
         thereof and such additional lands and estates therein; all strips and
         gores belonging, adjacent or pertaining to the Land or such additional
         lands and estates; and any after-acquired property (herein collectively
         referred to as the "Real Estate");



                                    I-2-B-2
<PAGE>   6

                  (b) Improvements. All of Grantor's right, title and interest
         in and to all buildings, structures and other improvements and any
         additions and alterations thereto or replacements thereof, now or
         hereafter built, constructed or located upon the Real Estate; and, to
         the extent that any of the following items of property constitutes
         fixtures under applicable laws, all furnishings, fixtures, fittings,
         appliances, apparatus, equipment, machinery, building and construction
         materials and other articles of every kind and nature whatsoever and
         all replacements thereof, now or hereafter affixed or attached to,
         placed upon or used in any way in connection with the complete and
         comfortable use, enjoyment, occupation, operation, development and/or
         maintenance of the Real Estate or such buildings, structures and other
         improvements, including, but not limited to, partitions, furnaces,
         boilers, oil burners, radiators and piping, plumbing and bathroom
         fixtures, refrigeration, heating, ventilating, air conditioning and
         sprinkler systems, other fire prevention and extinguishing apparatus
         and materials, vacuum cleaning systems, gas and electric fixtures,
         incinerators, compactors, elevators, engines, motors, generators and
         all other articles of property which are considered fixtures under
         applicable law (such buildings, structures and other improvements and
         such other property are herein collectively referred to as the
         "Improvements"; the Real Estate and the Improvements are herein
         collectively referred to as the "Property");

                  (c) Goods. All of Grantor's right, title and interest in and
         to all building materials, construction materials, appliances
         (including, without limitation, stoves, ranges, ovens, disposals,
         refrigerators, water fountains and coolers, fans, heaters, dishwashers,
         clothes washers and dryers, water heaters, hood and fan combinations,
         kitchen equipment, laundry equipment, kitchen cabinets and other
         similar equipment), stocks, supplies, blinds, window shades, drapes,
         carpets, floor coverings, manufacturing equipment and machinery, office
         equipment, growing plants and shrubbery, control devices, equipment
         (including window cleaning, building cleaning, swimming pool,
         recreational, monitoring, garbage, pest control and other equipment),
         motor vehicles, tools, furnishings, furniture, lighting, non-structural
         additions to the Real Estate and Improvements and all other tangible
         property of any kind or character, together with all replacements
         thereof, now or hereafter located on or in or used or useful in
         connection with the complete and comfortable use, enjoyment,
         occupation, operation, development and/or maintenance of the Property,
         regardless of whether or not located on or in the Property or located
         elsewhere for purposes of storage, fabrication or otherwise, but
         excluding inventory (as defined in the U.C.C.) (herein collectively
         referred to as the "Goods");

                  (d) Intangibles. All goodwill, trademarks, trade names, option
         rights, purchase contracts, real and personal property tax refunds,
         books and records and general intangibles of the Mortgagor relating to
         the Property and all accounts, contract rights, instruments, chattel
         paper and other rights of the Mortgagor for the payment of money for
         property sold or lent, for services rendered, for money lent, or for
         advances or deposits made, and any other intangible property of the
         Mortgagor relating to the Property (herein collectively referred to as
         the "Intangibles");

                  (e) Leases. All rights of the Grantor in, to and under all
         leases (other than the Authority Lease), licenses, occupancy
         agreements, concessions and other arrangements,

                                    I-2-B-3
<PAGE>   7

         oral or written, now existing or hereafter entered into, whereby any
         Person agrees to pay money or any other consideration for the use,
         possession or occupancy of, or any estate in, the Property or any
         portion thereof or interest therein (herein collectively referred to as
         the "Leases"), and the right, subject to applicable law, upon the
         occurrence of any Event of Default hereunder, to receive and collect
         the Rents (as hereinafter defined) paid or payable thereunder,

                  (f) Plans. All rights of the Grantor in and to all plans and
         specifications, designs, drawings and other information, materials and
         matters heretofore or hereafter prepared relating to the Improvements
         or any construction on the Real Estate (herein collectively referred to
         as the "Plans");

                  (g) Permits. All rights of the Grantor, to the extent
         assignable, in, to and under all permits, franchises, licenses,
         approvals and other authorizations respecting the use, occupation and
         operation of the Property and every part thereof and respecting any
         business or other activity conducted on or from the Property, and any
         product or proceed thereof or therefrom, including, without limitation,
         all building permits, certificates of occupancy and other licenses,
         permits and approvals issued by governmental authorities having
         jurisdiction (herein collectively referred to as the "Permits");

                  (h) Contracts. All right, title and interest of the Grantor,
         to the extent assignable, in and to all certificates, warranties,
         appraisals, engineering, environmental, soils, insurance and other
         reports and studies, books, records, correspondence, files and
         advertising materials, and other documents, now or hereafter obtained
         or entered into, as the case may be, pertaining to the construction,
         use, occupancy, possession, operation, management, leasing, maintenance
         and/or ownership of the Property and all right, title and interest of
         the Grantor therein (herein collectively referred to as the
         "Contracts");

                  (i) Leases of Furniture Furnishings and Equipment. All right,
         title and interest of the Grantor as lessee in, to and under any leases
         of furniture, furnishings, equipment and any other Goods now or
         hereafter installed in or at any time used in connection with the
         Property;

                  (j) Rents. All rents, issues, profits, royalties, avails,
         income and other benefits derived or owned, directly or indirectly, by
         the Grantor from the Property, including, without limitation, all rents
         and other consideration deposited in any Lockbox Account and all rents
         and other consideration payable by tenants, claims against guarantors,
         and any cash or other securities deposited to secure performance by
         tenants, under the Leases (herein collectively referred to as "Rents");

                  (k) Proceeds. All proceeds of the conversion, voluntary or
         involuntary of any of the foregoing into cash or liquidated claims,
         including, without limitation, proceeds of insurance and condemnation
         awards (herein collectively referred to as "Proceeds"); and

                  (1) Other Property. All other property and rights of the
         Grantor of every kind and character relating to the Property, and all
         proceeds and products of any of the



                                    I-2-B-4
<PAGE>   8

         foregoing, provided however, the Collateral shall not include any
         general intangibles or other rights arising under any contracts,
         instruments, licenses, or other documents as to which the grant of
         alien and/or security interest would constitute a violation of a valid
         and enforceable restriction in favor of a third party on such grant,
         unless and until any required consents shall have been obtained;

         AND, without limiting any of the other provisions of this Deed, the
Grantor expressly grants to the Grantee, as secured party, a security interest
in all of those portions of the Collateral which are or may be subject to the
State Uniform Commercial Code provisions applicable to secured transactions,
subject, however, to the Permitted Encumbrances;

         TO HAVE AND TO HOLD the Collateral to the use, benefit and behoof of
the Grantee, its successors, successors-in-title and assigns, forever, subject,
however, to the Permitted Encumbrances. This Deed is intended to operate and is
to be construed as a deed passing the title to the Collateral to Grantee and is
made under those provisions of the existing laws of the State relating to deeds
to secure debt and not as a mortgage, and is given to secure the payment of the
Secured Obligations.

         FURTHER to secure the full, timely and proper payment and performance
of the Secured Obligations, the Grantor hereby covenants and agrees with and
warrants to the Grantee as follows:

                                    ARTICLE I

                     COVENANTS AND AGREEMENTS OF THE GRANTOR

         SECTION 1.1. Payment of Secured Obligations. (i) The Grantor agrees
that:

                  (a) Grantor will duly and punctually pay and perform or cause
         to be paid and performed the Current Assets Loans (some or all of which
         Current Assets Loans are evidenced by Current Assets Notes) at the time
         and in accordance with the Loan Documents pertaining to the Current
         Assets Loans, which Current Assets Loans shall not exceed the maximum
         principal amount of One Hundred Twenty-Five Million and 00/100 Dollars
         ($125,000,000) and all of which Current Assets Loans have a Maturity
         Date as described in the fourth recital (WHEREAS clause) above; and

                  (b) when and as due and payable from time to time in
         accordance with the terms of this Deed or of any other Loan Documents
         pertaining to the Current Assets Loans, pay and perform, or cause to be
         paid and performed, all other Secured Obligations.

         SECTION 1.2. Title to Collateral, etc. The Grantor represents and
warrants to and covenants with the Grantee that:

                  (a) except as otherwise permitted by the terms of the Credit
         Agreement, as of the date hereof and at all times hereafter while this
         Deed is outstanding, the Grantor (1) is

                                    I-2-B-5
<PAGE>   9

         and shall be the absolute owner of the legal and beneficial title to
         the applicable interest in the Property and to all other property
         included in the Collateral, and (2) has and shall have good and
         sufficient easement or leasehold estate, as currently represented in
         the granting clause as of the date hereof, to the Property, subject in
         each case only to this Deed, the Permitted Liens (as defined in the
         Credit Agreement) and the encumbrances set forth in Schedule 2 hereto
         (collectively, the "Permitted Encumbrances");

                  (b) the Grantor has good and lawful right, power and authority
         to execute this Deed and to convey, transfer, assign, set over and
         grant the security title to and a security interest in the Collateral,
         all as provided herein;

                  (c) this Deed has been duly executed, acknowledged and
         delivered on behalf of the Grantor, all consents and other actions
         required to be taken by the officers, directors, shareholders and
         partners, as the case may be, of the Grantor have been duly and fully
         given and performed and this Deed constitutes the legal, valid and
         binding obligation of the Grantor, enforceable against the Grantor in
         accordance with its tenors;

                  (d) upon entry of the Interim Order, the Grantor shall have a
         security title on the Property and a perfected security interest in the
         Collateral other than the Property, senior in priority to all Liens
         other than the then applicable Priority Liens; and

                  (e) the Grantor, at its expense, will warrant and defend to
         the Grantee and any purchaser under the power of sale herein or at any
         foreclosure sale such title to the Collateral and the security title
         and perfected security interest of this Deed thereon and therein
         against all claims and demands and will maintain, preserve and protect
         such security title and security interest and will keep this Deed a
         valid, direct security title of record on the Property and a perfected
         security interest in the Collateral other than the Property, in each
         case senior in priority to all Liens other than the then applicable
         Priority Liens and subject only to the Permitted Encumbrances.

         SECTION 1.3. Intentionally Omitted.

         SECTION 1.4. Recordation. The Grantor, at its expense, will at all
times cause this Deed and any instruments amendatory hereof or supplemental
hereto and any instruments of assignment hereof or thereof (and any appropriate
financing statements or other instruments and continuations thereof), and each
other instrument delivered in connection with the Current Assets Loans, the
Credit Agreement or any other Loan Document pertaining to the Current Assets
Loans and intended thereunder to be recorded, registered and filed, to be kept
recorded, registered and filed, in such manner and in such places, and will pay
all such recording, registration, filing fees, taxes and other charges, and will
comply with all such statutes and regulations as may be required by law in order
to establish, preserve, perfect and protect the security title and security
interest of this Deed as a valid, direct security title on the Property and
perfected security interest in the Collateral other than the Property, senior in
priority to all Liens other than the then applicable Priority Liens. The Grantor
will pay or cause to be paid, and will indemnify the Grantee in respect of, all
taxes (including interest and penalties) at any time


                                    I-2-B-6
<PAGE>   10

payable in connection with the filing and recording of this Deed and any and all
supplements and amendments hereto.

         SECTION 1.5. Payment of Impositions, etc. Subject to Section 1.8
(relating to permitted contests), the Grantor will pay or cause to be paid
before the same would become delinquent and before any fine, penalty, interest
or cost may be added for non-payment, all taxes, assessments, water and sewer
rates, charges, license fees, inspection fees and other governmental levies or
payments, of every kind and nature whatsoever, general and special, ordinary and
extraordinary, unforeseen as well as foreseen, which at any time may be
assessed, levied, confirmed, imposed or which may become a lien upon the
Collateral, or any portion thereof, or which are payable with respect thereto,
or upon the rents, issues, income or profits thereof, or on the occupancy,
operation, use, possession or activities thereof, whether any or all of the same
be levied directly or indirectly or as excise taxes or as income taxes, and all
taxes, assessments or charges which may be levied on the Secured Obligations, or
the interest thereon (collectively, the "Impositions"). The Grantor will deliver
to the Grantee, upon request, copies of official receipts or other satisfactory
proof evidencing such payments.

         SECTION 1.6. Insurance and Legal Requirements. Subject to Section 1.8
(relating to permitted contests), the Grantor, at its expense, will comply in
all material respects, or cause compliance in all material respects with

                  (a) all provisions of any insurance policy covering or
         applicable to the Collateral or any part thereof, all requirements of
         the issuer of any such policy, and all orders, rules, regulations and
         other requirements of the National Board of Fire Underwriters (or any
         other body exercising similar functions) applicable to or affecting the
         Collateral or any part thereof or any use or condition of the
         Collateral or any part thereof (collectively, the "Insurance
         Requirements"); and

                  (b) all laws, including Environmental Laws, statutes, codes,
         acts, ordinances, orders, judgments, decrees, injunctions, rules,
         regulations, permits, licenses, authorizations, directions and
         requirements of all governments, departments, commissions, boards,
         courts, authorities, agencies, officials and officers, foreseen or
         unforeseen, ordinary or extraordinary, which now or at any time
         hereafter may be applicable to the Collateral or any part thereof, or
         any of the adjoining sidewalks, curbs, vaults and vault space, if any,
         streets or ways, or any use or condition of the Collateral or any part
         thereof (collectively, the "Legal Requirements");

noncompliance of which could reasonably be expected to cause a Material Adverse
Effect whether or not compliance therewith shall require structural changes in
or interference with the use and enjoyment of the Collateral or any part
thereof.

         SECTION 1.7. Security Interests, etc. The Grantor will not directly or
indirectly create or permit or suffer to be created or to remain, and will
promptly discharge or cause to be discharged, any deed to secure debt, deed of
trust, mortgage, encumbrance or charge on, pledge of, security interest in or
conditional sale or other title retention agreement with respect to or any other
lien or security interest or security title on or in the Collateral or any part
thereof or the


                                    I-2-B-7
<PAGE>   11

interest of the Grantor or the Grantee therein, of any Proceeds thereof or Rents
or other sums arising therefrom, other than (a) Permitted Encumbrances, and (b)
liens of mechanics, materialmen, suppliers or vendors or rights thereto incurred
in the ordinary course of the business of the Grantor for sums not yet due or
any such liens or rights thereto which are at the time being contested as
permitted by Section 1.8. The Grantor will not postpone the payment of any sums
for which liens of mechanics, materialmen, suppliers or vendors or rights
thereto have been incurred (unless such liens or rights thereto are at the time
being contested as permitted by Section 1.8), for more than 60 days after the
completion of the action giving rise to such liens or rights thereto.

         SECTION 1.8. Permitted Contests. The Grantor at its expense may
contest, or cause to be contested, by appropriate legal proceedings conducted in
good faith and with due diligence, the amount or validity or application, in
whole or in part, of any Imposition, Legal Requirement or Insurance Requirement
or lien of a mechanic, materialman, supplier or vendor, provided that, (a) in
the case of an unpaid Imposition, lien, encumbrance or charge, such proceedings
shall suspend the collection thereof from the Grantor, the Grantee, and the
Collateral (including any rent or other income therefrom) and shall not
materially interfere with the payment of any such rent or income, (b) neither
the Collateral nor any rent or other income therefrom nor any part thereof or
interest therein would be in any material danger of being sold, forfeited, lost,
impaired or interfered with, (c) in the case of a Legal Requirement, neither the
Grantor nor the Grantee would be in material danger of any civil or criminal
liability for failure to comply therewith, (d) the Grantor shall have furnished
such security, if any, as may be required in the proceedings or as may be
reasonably requested by the Grantee, (e) the non-payment of the whole or any
part of any Imposition will not result in the delivery of a tax deed to the
Collateral or any part thereof because of such non-payment, (f) the payment of
any sums required to be paid with respect to any of the Current Asset Notes or
under this Deed (other than any unpaid Imposition, lien, encumbrance or charge
at the time being contested in accordance with this Section 1.8) shall not be
interfered with or otherwise affected, (g) in the case of any Insurance
Requirement, the failure of the Grantor to comply therewith shall not affect the
validity of any insurance required to be maintained by the Grantor under Section
2.1, and (h) that adequate reserves, determined in accordance with GAAP, shall
have been set aside on the Grantor's books.

         SECTION 1.9. Leases. The Grantor represents and warrants to the Grantee
that, as of the date hereof, there are no written or oral leases or other
agreements of any kind or nature relating to the occupancy of any portion of the
Property by any Person other than the Grantor other than the Permitted
Encumbrances. Except as is permitted by the Credit Agreement, the Grantor will
not enter into any such written or oral lease or other agreement with respect to
any portion of the Property without first obtaining the written consent of the
Grantee.

         SECTION 1.10. Compliance with Instruments. The Grantor at its expense
will promptly comply in all material respects with all rights of way or use,
privileges, franchises, servitudes, licenses, easements, tenements,
hereditaments and appurtenances forming a part of the Property and all
instruments creating or evidencing the same, in each case, to the extent
compliance therewith is required of the Grantor under the terms thereof. Except
as is permitted by the Credit Agreement, the Grantor will not take any action
which may result in a forfeiture or termination of the rights afforded to the
Grantor under any such instruments and will not, without the prior

                                    I-2-B-8
<PAGE>   12

written consent of the Grantee, amend any of such instruments in any manner
adverse to the Current Assets Lenders in any material respect.

         SECTION 1.11. Maintenance and Repair, etc. Subject to the provisions of
Section 1.12 the Grantor will keep or cause to be kept all presently and
subsequently erected or acquired Improvements and the sidewalks, curbs, vaults
and vault space, if any, located on or adjoining the same, and the streets and
the ways adjoining the same, in good and substantial order and repair and in
such a fashion that neither the value nor utility of the Collateral will be
diminished, and, at its sole cost and expense, will promptly make or cause to be
made all necessary and appropriate repairs, replacements and renewals thereof,
whether interior or exterior, structural or nonstructural, ordinary or
extraordinary, foreseen or unforeseen, so that its business carried on in
connection therewith may be properly conducted at all times. The Grantor at its
expense will do or cause to be done all shoring of foundations and walls of any
building or other Improvements on the Property and (to the extent permitted by
law) of the ground adjacent thereto, and every other act necessary or
appropriate for the preservation and safety of the Property by reason of or in
connection with any excavation or other building operation upon the Property and
upon any adjoining property, whether or not the Grantor shall, by any Legal
Requirement, be required to take such action or be liable for failure to do so.

         SECTION 1.12. Alterations, Additions, etc. So long as no Event of
Default shall have occurred and be continuing, the Grantor shall have the right
at any time and from time to time to make or cause to be made reasonable
alterations of and additions to the Property or any part thereof, provided that
any alteration or addition: (a) shall not change the general character or the
use of the Property or reduce the fair market value thereof below its value
immediately before such alteration or addition, or impair the usefulness of the
Property; (b) is effected with due diligence, in a good and workmanlike manner
and in compliance in all material respects with all Legal Requirements and
Insurance Requirements; (c) subject to Section 1.8 is promptly and fully paid
for, or caused to be paid for, by the Grantor; and (d) is made, in case the
estimated cost of such alteration or addition exceeds U.S. $1,000,000, under the
supervision of a qualified architect or engineer or another professional.

         SECTION 1.13. Acquired Property Subject to Security Title/Security
Interest. Subject to the Permitted Encumbrances and except as otherwise
permitted by the Credit Agreement, all property at any time acquired by the
Grantor and provided or required by this Deed to be or become subject to the
security title and security interest hereof, whether such property is acquired
by exchange, purchase, construction or otherwise, shall forthwith become subject
to the security title and security interest of this Deed without further action
on the part of the Grantor or the Grantee. The Grantor, at its expense, will
execute and deliver to the Grantee (and will record and file as provided in
Section 1.4) an instrument supplemental to this Deed reasonably satisfactory in
substance and form to the Grantee, whenever such an instrument is necessary
under applicable law to subject to the security title and security interest of
this Deed all right, title and interest of the Grantor in and to all property
provided or required by this Deed to be subject to the security title and
security interest hereof.

         SECTION 1.14. Assignment of Rents, Proceeds. etc. The assignment, grant
and conveyance of the Leases, Rents, Proceeds and other rents, income, proceeds
and benefits of the



                                    I-2-B-9
<PAGE>   13

Collateral contained in the granting clause of this Deed constitutes an
absolute, present and irrevocable assignment, grant and conveyance, provided,
however, that a revocable license is hereby given to the Grantor, so long as no
Event of Default has occurred and be continuing hereunder, to collect, receive
and apply such Rents, Proceeds and other rents, income, proceeds and benefits as
they become due and payable, but not further in advance thereof than is
customary, and in accordance with all of the other terms, conditions and
provisions hereof, of the Loan Documents, and of the Leases, contracts,
agreements and other instruments with respect to which such payments are made or
such other benefits are conferred; provided, further, however, that, to the
extent required by the Credit Agreement, all such Leases, Rents, Proceeds and
other rents, income, proceeds and benefits shall be deposited directly into the
Lockbox Accounts. Upon the occurrence and continuance of an Event of Default,
such license shall terminate immediately and automatically, without notice to
the Grantor or any other Person except as required by law, and shall not be
reinstated upon a cure of such Event of Default without the express written
consent of the Grantee. Such assignment shall be fully effective without any
further action on the part of the Grantor or the Grantee and the Grantee shall
be entitled, at its option without further order of or application to the
Bankruptcy Court, upon the occurrence and continuance of an Event of Default
hereunder, to collect, receive and apply all Rents, Proceeds and all other
rents, income, proceeds and benefits from the Collateral, including all right,
title and interest of the Grantor in any escrowed sums or deposits or any
portion thereof or interest therein, whether or not the Grantee takes possession
of the Collateral or any part thereof. The Grantor further grants to the Grantee
the right, at the Grantee's option without further order of or application to
the Bankruptcy Court, upon the occurrence and continuance of an Event of Default
hereunder, to:

                  (a) enter upon and take possession of the Property for the
         purpose of collecting Rents, Proceeds and said rents, income, proceeds
         and other benefits;

                  (b) dispossess by the customary summary proceedings any
         tenant, purchaser or other Person defaulting in the payment of any
         amount when and as due and payable, or in the performance of any other
         obligation, under any Lease, contract or other instrument to which said
         Rents, Proceeds or other rents, income, proceeds or benefits relate;

                  (c) let or convey the Collateral or any portion thereof or any
         interest therein; and

                  (d) apply Rents, Proceeds and such rents, income, proceeds and
         other benefits, after the payment of all necessary fees, charges and
         expenses, on account of the Secured Obligations in accordance with
         Section 3.11.

         SECTION 1.15. No Claims Against the Grantee. Nothing contained in this
Deed shall constitute any consent or request by the Grantee, express or implied,
for the performance of any labor or the furnishing of any materials or other
property in respect of the Property or any part thereof, or be construed to
permit the making of any claim against the Grantee in respect of labor or
services or the furnishing of any materials or other property or any claim that
any lien based on the performance of such labor or the furnishing of any such
materials or other property



                                    I-2-B-10
<PAGE>   14

is prior to the security title and security interest of this Deed. ALL
CONTRACTORS, SUBCONTRACTORS, VENDORS AND OTHER PERSONS DEALING WITH THE
PROPERTY, OR WITH ANY PERSONS INTERESTED THEREIN, ARE HEREBY REQUIRED TO TAKE
NOTICE OF THE PROVISIONS OF THIS SECTION.

         SECTION 1.16. Indemnification. The Grantor will protect, indemnify,
save harmless and defend the Grantee, the Current Assets Lenders, and each of
their respective officers, directors, shareholders, employees, representatives
and agents (collectively, the "Indemnified Parties" and individually, as
"Indemnified Party"), from and against any and all liabilities, obligations,
claims, damages, penalties, causes of action, costs and expenses (including,
without limitation, reasonable attorneys' fees and expenses) imposed upon or
incurred by or asserted against any Indemnified Party by reason of (a) ownership
of an interest in this Deed, any other Loan Document pertaining to the Current
Assets Loans or the Property, (b) any accident; injury to or death of persons or
loss of or damage to or loss of the use of property occurring on or about the
Property or any part thereof or the adjoining sidewalks, curbs, vaults and vault
spaces, if any, streets, alleys or ways, (c) any use, non-use or condition of
the Property or any part thereof or the adjoining sidewalks, curbs, vaults and
vault spaces, if any, streets, alleys or ways, (d) any failure on the part of
the Grantor to perform or comply with any of the terms of this Deed or any Loan
Document pertaining to the Current Assets Loans, (e) performance of any labor or
services or the furnishing of any materials or other property in respect of the
Collateral or any part thereof made or suffered to be made by or on behalf of
the Grantor, (f) any negligence or tortious act on the part of the Grantor or
any of its agents, contractors, lessees, licensees or invitees, (g) any work in
connection with any alterations, changes, new construction or demolition of or
additions to the Property, or (h) (i) any Hazardous Material on, in, under or
affecting all or any portion of the Property, the groundwater, or any
surrounding areas; (ii) any misrepresentation, inaccuracy or breach of any
warranty, covenant or agreement contained or referred to in Sections 1.21 and
1.22, (iii) any violation or claim of violation by the Grantor of any
Environmental Laws, or (iv) the imposition of any lien for damages caused by or
the recovery of any costs for the cleanup, release or threatened release of any
Hazardous Material, except to the extent that any of the matters described in
subsections (a)-(h) arise out of the gross negligence or willful misconduct of
any Indemnified Party. If any action or proceeding be commenced, to which action
or proceeding any Indemnified Party is made a party by reason of the execution
of this Deed or any other Loan Document pertaining to the Current Assets Loans,
or in which it becomes necessary to defend or uphold the lien of this Deed, all
sums paid by the Indemnified Parties, for the expense of any litigation to
prosecute or defend the rights and lien created hereby or otherwise, shall be
paid by the Grantor to such Indemnified Parties, as the case may be, as
hereinafter provided. The Grantor will pay and save the Indemnified Parties
harmless against any and all liability with respect to any intangible personal
property tax or similar imposition of the State or any subdivision or authority
thereof now or hereafter in effect, to the extent that the same may be payable
by the Indemnified Parties in respect of this Deed, any Loan Document pertaining
to the Current Assets Loans or any Secured Obligation. All amounts payable to
the Indemnified Parties under this Section 1.16 shall be deemed indebtedness
secured by this Deed and any such amounts which are not paid within ten (10)
days after written demand therefor by any Indemnified Party shall bear interest
at the rate provided for in Section 3.2.2 of the Credit Agreement from the date
of such demand. In case any action, suit or proceeding is brought against any
Indemnified Party by reason of any such occurrence, the Grantor, upon request of
such Indemnified Party, will, at the Grantor's expense, resist and defend such
action, suit or

                                    I-2-B-11
<PAGE>   15

proceeding or cause the same to be resisted or defended by counsel designated by
the Grantor and approved by such Indemnified Party. The obligations of the
Grantor under this Section 1.16 shall survive any cancellation and surrender of
this Deed.

         SECTION 1.17. No Credit for Payment of Taxes. The Grantor shall not be
entitled to any credit against the Secured Obligations by reason of the payment
of any tax on the Property or any part thereof or by reason of the payment of
any other Imposition, and shall not apply for or claim any deduction from the
taxable value of the Property or any part thereof by reason of this Deed.

         SECTION 1.18. Intentionally Omitted

         SECTION 1.19. No Transfer of the Property. Except as is provided in the
Credit Agreement, and except for the Permitted Encumbrances, the Grantor shall
not, without the prior written consent of the Grantee, which consent may be
granted or withheld in the sole and absolute discretion of the Grantee (i) sell,
convey, assign or otherwise transfer the Property or any portion of the
Grantor's interest therein or (ii) further encumber the Property or permit the
Property to become encumbered by any lien, claim, security title, security
interest or other indebtedness of any kind or nature other than the Permitted
Encumbrances.

         SECTION 1.20. Security Agreement. With respect to the items of personal
property and fixtures referred to and described in the granting clause of this
Deed and included as part of the Collateral, this Deed is hereby made and
declared to be a security agreement encumbering each and every item of personal
property and fixtures now or hereafter owned by Grantor and included herein as a
part of the Collateral, in compliance with the provisions of the Uniform
Commercial Code as enacted in the State. In this respect, Grantor, as "Debtor",
expressly grants to Grantee, as "Secured Party", a security interest in and to
all of the property now or hereafter owned by Grantor which constitutes the
personal property and fixtures hereinabove referred to and described in this
Deed, including all extensions, accessions, additions, improvements,
betterments, renewals, replacements and substitutions thereof or thereto, and
all proceeds from the sale or other disposition thereof. Grantor agrees to
execute and deliver to Grantee, upon Grantee's request, any other security
agreement and financing statements, as well as extensions, renewals, and
amendments thereof, in such form as Grantee may reasonably require to perfect a
security interest with respect to said items. Grantor shall pay all costs of
filing such financing statements and any extensions, renewals, amendments and
releases thereof, and shall pay all reasonable costs and expenses of any record
searches for financing statements Grantee may reasonably require. Except as is
provided in the Credit Agreement, and except for the Permitted Encumbrances,
without the prior written consent of Grantee, Grantor shall not create or suffer
to be created pursuant to the Uniform Commercial Code any other security
interest in the above-described personal property and fixtures, including any
replacements and additions thereto. Upon the occurrence and continuance of an
Event of Default under this Deed, the Grantee shall have and shall be entitled
to exercise any and all of the rights and remedies (i) as prescribed in this
Deed, or (ii) as prescribed by general law, or (iii) as prescribed by the
specific statutory provisions now or hereafter enacted and specified in said
Uniform Commercial Code, all at Grantee's sole election. Grantor and Grantee
agree that the filing of any financing statements in the records normally having
to do with personal property shall not in any way affect the

                                    I-2-B-12
<PAGE>   16

agreement of Grantor and Grantee that everything located in, on or about, or
used or intended to be used with or in connection with the use, operation or
enjoyment of, the Collateral, which is described or reflected as a fixture in
this Deed, is, and at all times and for all purposes and in all proceedings,
both legal and equitable, shall be, regarded as part of the Real Estate conveyed
hereby. Grantor warrants that Grantor's name, identity and address are as set
forth herein. The mailing address of the Grantee from which information may be
obtained concerning the security interest created herein is also set forth
herein.

         SECTION 1.21. Representations and Warranties. In order to induce the
Grantee to enter into this Deed, the Credit Agreement and the other Loan
Documents pertaining to the Current Assets Loans, the Grantor agrees that all of
the representations and warranties of Grantor set forth in the Credit Agreement
are incorporated into this Deed by reference as if fully set forth herein.

         SECTION 1.22. Grantor's Covenants. In order to induce the Grantee to
enter into this Deed, the Credit Agreement and the other Loan Documents, the
Grantor agrees that all of the covenants of Grantor set forth in the Credit
Agreement are incorporated into this Deed by reference as if fully set forth
herein.

         SECTION 1.23. Attornment. Grantee hereby acknowledges and agrees that
the liens granted herein are subject to the rights of certain lessees under the
Leases as disclosed in the Credit Agreement and will be subject to the rights of
lessees under any Leases entered into by Grantor after the date hereof which are
permitted as Permitted Real Estate Liens pursuant to the Credit Agreement,
subject to the express rights contained in the applicable Lease. The rights of
the tenants under the Leases to the leased premises shall not be adversely
affected by the exercise by Grantee of any of its rights hereunder, nor shall
any such tenant be in any way deprived of its rights under the applicable Lease
except in accordance with the terms of such Lease. In the event that Grantee
succeeds to the interest of Grantor under a Lease, such Lease shall not be
terminated or affected thereby except as set forth therein, and any sale of the
applicable leased premises by Grantee or pursuant to the judgment of any court
in an action to enforce the remedies provided for in this Deed shall be made
subject to such Lease and the rights of such tenant expressly set forth
thereunder. If Grantee succeeds to the interests of Grantor in and to the
applicable leased premises or under such Lease or enters into possession of such
leased premises, the Grantee, and such tenants, shall be bound to each other
under all of the express terms, covenants and conditions of such Lease, as if
the Grantee was originally the Grantor as lessor thereunder.

                                   ARTICLE II

                 INSURANCE: DAMAGE, DESTRUCTION OR TAKING, ETC.

         SECTION 2.1. Insurance.

         SECTION 2.1.1. Risks to be Insured. The Grantor will, at its expense,
maintain or cause to be maintained with insurance carriers approved by the
Grantee (a) insurance with respect to the Improvements against loss or damage by
fire, lightning and such other risks as are included

                                    I-2-B-13
<PAGE>   17

in standard "all-risk" policies, in amounts sufficient to prevent the Grantor
and the Grantee from becoming a co-insurer of any partial loss under the
applicable policies, but in any event in amounts not less than the then full
insurable value (actual replacement value) of the Improvements, as determined by
the Grantor in accordance with generally accepted insurance practice and
approved by the Grantee or, at the request of the Grantee, as determined at the
Grantor's expense by the insurer or insurers or by an expert approved by the
Grantee, (b) comprehensive public liability, including bodily injury and product
liability and property damage, insurance, with personal injury endorsements,
applicable to the Property in such amounts as are customarily carried by Persons
operating similar properties in the same general locality, but in any event with
a combined single limit of not less than Twenty Million Dollars ($20,000,000)
per occurrence, (c) explosion insurance in respect of any steam and pressure
boilers and similar apparatus located in the Property in such amounts as are
usually carried by persons operating similar properties in the same general
locality, but in any event in an amount not less than Twenty Million Dollars
($20,000,000), (d) business interruption insurance (including added expense
coverage) against all insurable perils for a period of not fewer than twelve
(12) months (subject to a reasonable aggregate deductible not exceeding ten (10)
days per any occurrence or, if an aggregate deductible not exceeding ten (10)
days per occurrence is not then available, the lowest aggregate deductible then
available), (e) worker's compensation insurance to the full extent required by
applicable law for all employees of the Grantor engaged in any work on or about
the Property and employer's liability insurance with a limit of not less than
Ten Million Dollars ($10,000,000) for each occurrence, (f) all-risk, builders'
risk insurance with respect to the Property during any period during which there
is any construction work being performed, against loss or damage by fire or
other risks, including vandalism, malicious mischief and sprinkler leakage, as
are included in so-called "extended coverage" clauses at the time available and
(g) such other insurance with respect to the Property in such amounts and
against such insurable hazards as the Grantee from time to time may reasonably
require by written notice to the Grantor.

         SECTION 2.1.2. Policy Provisions. All insurance maintained by the
Grantor pursuant to Section 2.1.1 shall (a) (except for worker's compensation
insurance) list the Grantee as an additional insured as its interests may
appear, (b) (except for worker's compensation and public liability insurance)
provide that the proceeds for any losses shall be adjusted by the Grantor
subject to the approval of the Grantee in the event the proceeds shall exceed
$1,000,000, and shall be payable to the Grantee, to be held and applied as
provided in Section 2.3, (c) include effective waivers by the insurer of all
rights of subrogation against any named insured, the indebtedness secured by
this Deed and the Property and all claims for insurance premiums against the
Grantee, (d) (except for worker's compensation and public liability insurance)
provide that any losses shall be payable notwithstanding (i) any act, failure to
act or negligence of or violation of warranties, declarations or conditions
contained in such policy by any named insured, (ii) the occupation or use of the
Property for purposes more hazardous than permitted by the terms thereof, (iii)
any foreclosure or other action or proceeding taken by the Grantee pursuant to
any provision of this Deed, or (iv) any change in title or ownership of the
Property, (e) provide that no cancellation, reduction in amount or material
change in coverage thereof or any portion thereof shall be effective until at
least thirty (30) days after receipt by the Grantee of written notice thereof,
(f) provide that any notice under such policies shall be simultaneously
delivered to the Grantee, and (g) be satisfactory in all other reasonable
respects to the Grantee.



                                    I-2-B-14
<PAGE>   18

Any insurance maintained pursuant to this Section 2.1 may be evidenced by
blanket insurance policies covering the Property and other properties or assets
of the Grantor, provided that any such policy shall specify the portion, if less
than all, of the total coverage of such policy that is allocated to the Property
and shall in all other respects comply with the requirements of this Section
2.1.

         SECTION 2.1.3. Delivery of Policies, etc. The Grantor will deliver to
the Grantee, promptly upon request, (a) certificates of all policies evidencing
all insurance required to be maintained under Section 2.1.1 (or, in the case of
blanket policies, certificates thereof by the insurers together with a
counterpart of each blanket policy), and (b) evidence as to the payment of all
premiums due thereon (with respect to public liability insurance policies, all
installments for the current year due thereon to such date), provided that
Grantee shall not be deemed by reason of its custody of such policies to have
knowledge of the contents thereof. The Grantor will also deliver to the Grantee
prior to the expiration of any policy a binder or certificate of the insurer
evidencing the replacement thereof and when the new policy is issued a
certificate of the new policy (or, in the case of a replacement blanket policy,
a certificate thereof of the insurer together with a counterpart of the blanket
policy). In the event the Grantor shall fail to effect or maintain any insurance
required to be effected or maintained pursuant to the provisions of this Section
2.1, the Grantor will indemnify the Grantee against damage, loss or liability
resulting from all risks for which such insurance should have been effected or
maintained.

         SECTION 2.1.4. Separate Insurance. The Grantor will not take out
separate insurance concurrent in form or contributing in the event of loss with
that required to be maintained pursuant to this Section 2.1.

         SECTION 2.2. Damage, Destruction or Taking; Grantor to Give Notice;
Assignment of Awards. In case of

                  (a) any material damage to or destruction of the Collateral or
         any material part thereof, or

                  (b) any taking, whether for permanent or temporary use, of all
          or any material part of the Collateral or any material interest
          therein or material right accruing thereto, as the result of the
          exercise of the right of condemnation or eminent domain, or a change
          of grade affecting the Collateral or any portion thereof (a "Taking"),
          or the commencement of any proceedings or negotiations which may
          result in a Taking,

the Grantor will promptly give written notice thereof to the Grantee, generally
describing the nature and extent of such damage or destruction and the Grantor's
best estimate of the cost of restoring the Collateral, or the nature of such
proceedings or negotiations and the nature and extent of the Taking which might
result therefrom, as the case may be. The Grantee shall be entitled to all
insurance proceeds payable on account of such damage or destruction and to all
awards or payments allocable to the Collateral on account of such Taking up to
the amount of the Secured Obligations, and the Grantor hereby irrevocably
assigns, transfers and sets over to the Grantee all rights of the Grantor to any
such proceeds, awards or payments and irrevocably authorizes and empowers the
Grantee, at its option, in the name of the Grantor or otherwise, to

                                    I-2-B-15
<PAGE>   19

file and prosecute what would otherwise be the Grantor's claim for any such
proceeds, award or payment and to collect, receipt for and retain the same for
disposition in accordance with Section 2.3. The Grantor will pay all reasonable
costs and expenses incurred by the Grantee in connection with any such damage,
destruction or Taking and seeking and obtaining any insurance proceeds, awards
or payments in respect thereof.

         SECTION 2.3. Application of Proceeds and Awards. Subject to any
applicable requirements of the Financing Order, the Credit Agreement and the
Revolver Intercreditor Agreement, all amounts recovered under any insurance
policy required to be maintained by the Grantor hereunder and all awards
received by it on account of any Taking shall be deposited in a Lockbox Account
maintained by the Grantor to be applied pursuant to the provisions of the Credit
Agreement.

         Notwithstanding the foregoing provisions of this Section 2.3 to the
contrary (but subject to the provisions of Section 2.4), and if each of the
following conditions is satisfied, the Grantee, upon request of the Grantor, may
apply up to $2,500,000 of insurance proceeds or condemnation awards received by
it toward the restoration or replacement of the affected Collateral, to the
extent necessary for the restoration or replacement thereof; provided that:

                           (i) no Default or Event of Default then exists;

                           (ii) the Grantor shall have furnished to the Grantee
                  a certificate of an architect or engineer reasonably
                  acceptable to the Grantee stating (x) that the Collateral is
                  capable of being restored, prior to the maturity of the Credit
                  Agreement, to substantially the same condition as existed
                  prior to the casualty, (y) the aggregate estimated direct and
                  indirect costs of such restoration and (z) as to any Taking,
                  that the property taken in such Taking, or sold under threat
                  thereof, is not necessary to the Grantor's customary use or
                  occupancy of the Property or Grantor otherwise provides
                  Grantee adequate assurance that the Collateral can be
                  restored; and

                           (iii) in the event that the estimated cost of
                  restoration set forth in the certificate of such architect or
                  engineer (and such revisions to such estimate as are from time
                  to time made) exceeds maximum amount of insurance proceeds or
                  condemnation awards that would be permitted to be applied to
                  the restoration or replacement of the Collateral pursuant to
                  the foregoing, the Grantor shall deposit the amount of such
                  excess with the Grantee.

         In the event that, after the restoration or replacement of the
Collateral, any insurance or condemnation awards shall remain, such amount shall
be deposited in a Lockbox Account to be applied pursuant to the provisions of
the Credit Agreement. If, prior to the receipt by the Grantee of such insurance
proceeds or condemnation awards, the Collateral shall have been sold on
foreclosure, the Grantee shall have the right to receive said insurance proceeds
or condemnation awards to the extent of any deficiency found to be due upon such
sale, with legal interest thereon, whether or not a deficiency judgment shall
have been sought or recovered or


                                    I-2-B-16
<PAGE>   20

denied, and the reasonable attorneys' fees, costs and disbursements incurred by
the Grantee in connection with the collection of such award or payment.

         SECTION 2.4. Total Taking and Total Destruction. Subject to any
applicable requirements of the Financing Order, the Credit Agreement and the
Revolver Intercreditor Agreement, in the event of a Total Destruction or a Total
Taking, the Grantee shall apply all amounts recovered under any insurance policy
referred to in Section 2.1.1 and all awards received by it on account of any
such Taking shall be deposited in a Lockbox Account maintained by the Grantor to
be applied pursuant to the provisions of the Credit Agreement.

                                   ARTICLE III

                        EVENTS OF DEFAULT; REMEDIES, ETC.

         SECTION 3.1 Events of Default; Acceleration. If an "Event of Default"
(pursuant to and as defined in the Credit Agreement) shall have occurred and be
continuing, then and in any such event the Grantee may, subject to any
applicable requirements of the Financing Order, the Credit Agreement and the
Revolver Intercreditor Agreement, at any time thereafter (unless all Events of
Default shall theretofore have been remedied and all costs and expenses,
including, without limitation, attorneys' fees and expenses incurred by or on
behalf of the Grantee, shall have been paid in full by the Grantor) declare, by
written notice to the Grantor, the Current Assets Loans and all other Secured
Obligations to be due and payable immediately or on a date specified in such
notice, and on such date the same shall be and become due and payable, together
with interest accrued thereon, without presentment, demand, protest or notice,
all of which the Grantor hereby waives. The Grantor will pay on demand all costs
and expenses, including, without limitation, attorneys' fees and expenses,
incurred by or on behalf of the Grantee in enforcing this Deed, or any other
Loan Document evidencing or securing the Current Assets Loans, or occasioned by
any default hereunder or thereunder.

          SECTION 3.2. Legal Proceedings; Judicial Foreclosure. If an Event of
Default shall have occurred and be continuing, the Grantee at any time may, at
its election and without further order of or application to the Bankruptcy
Court, but subject to any applicable requirements of the Financing Order, the
Credit Agreement and the Revolver Intercreditor Agreement, proceed at law or in
equity or otherwise to enforce the payment and performance of the Secured
Obligations in accordance with the terms hereof and thereof and to foreclose the
security title of this Deed as against all or any part of the Collateral and to
have the same sold under the judgment or decree of a court of competent
jurisdiction. The Grantee shall be entitled to recover in such proceedings all
costs incident thereto, including attorneys' fees and expenses in such amounts
as may be fixed by the court.

          SECTION 3.3. Power of Sale. If an Event of Default shall have occurred
and be continuing, Grantee, at its option, may, without further order of or
application to the Bankruptcy Court, sell the Collateral or any part of the
Collateral at one or more public sale or sales before the door of the courthouse
of the county in which the Land or any part of the Land is situated, to the
highest bidder for cash, in order to pay the Secured Obligations, and all
expenses of sale and of all proceedings in connection therewith, including
attorney's fees, after advertising the time,

                                    I-2-B-17
<PAGE>   21

place and terms of sale once a week for four (4) weeks immediately preceding
such sale (but without regard to the number of days) in a newspaper in which
Sheriff's sales are advertised in said county. At any such public sale, Grantee
may execute and deliver to the purchaser a conveyance of the Collateral or any
part of the Collateral, and to this end, Grantor hereby constitutes and appoints
Grantee the agent and attorney-in-fact of Grantor to make such sale and
conveyance, and thereby to divest Grantor of all right, title and equity that
Grantor may have in and to the Collateral and to vest the same in the purchaser
or purchasers at such sale or sales, and all the acts and doings of said agent
and attorney-in-fact are hereby ratified and confirmed and any recitals in said
conveyance or conveyances as to facts essential to a valid sale shall be binding
upon Grantor. The aforesaid power of sale and agency hereby granted are coupled
with an interest and are irrevocable by death or otherwise, are granted as
cumulative of the other remedies provided hereby or by law for collection of the
Secured Obligations and shall not be exhausted by one exercise thereof but may
be exercised until full payment of all of the Secured Obligations. In the event
of any sale under this Deed by virtue of the exercise of the powers herein
granted, or pursuant to any order in any judicial proceeding or otherwise, the
Collateral may be sold as an entirety or in separate parcels and in such manner
or order as Grantee in its sole discretion may elect. One or more exercises of
the powers herein granted shall not extinguish nor exhaust such powers, until
the entire Collateral is sold or the Secured Obligations paid in full. If the
Secured Obligations are now or hereafter further secured by any chattel
mortgages, pledges, contracts of guaranty, assignments of lease or other
security instruments, Grantee may, at its option and without further order of or
application to the Bankruptcy Court, but subject to any applicable requirements
of the Financing Order, the Credit Agreement and the Revolver Intercreditor
Agreement, exhaust the remedies granted under any of said security instruments
either concurrently or independently, and in such order as Grantee may
determine. Upon any public foreclosure sale or sales of all or any portion of
the Collateral under the power herein granted, Grantee may bid for and purchase
the Collateral and shall be entitled to apply all or any part of the Secured
Obligations as a credit to the purchase price. In the event of any such public
foreclosure sale or sales under the power herein granted, Grantor shall be
deemed a tenant holding over and shall forthwith deliver possession to the
purchaser or purchasers at such sale or be summarily dispossessed according to
provisions of law applicable to tenants holding over.

          SECTION 3.4. Uniform Commercial Code Remedies. If an Event of Default
shall have occurred and be continuing, the Grantee may, without further order of
or application to the Bankruptcy Court, but subject to any applicable
requirements of the Financing Order, the Credit Agreement and the Revolver
Intercreditor Agreement, exercise from time to time and at any time any rights
and remedies available to it under applicable law upon default in the payment of
indebtedness, including, without limitation, any right or remedy available to it
as a secured party under the Uniform Commercial Code of the State. The Grantor
shall, promptly upon request by the Grantee, assemble the Collateral, or any
portion thereof generally described in such request, and make it available to
the Grantee at such place or places designated by the Grantee and reasonably
convenient to the Grantee or the Grantor. If the Grantee elects to proceed under
the Uniform Commercial Code of the State to dispose of portions of the
Collateral, the Grantee, at its option, may give the Grantor notice of the time
and place of any public sale of any such property, or of the date after which
any private sale or other disposition thereof is to be made, by sending notice
by registered or certified first class mail, postage prepaid, to the Grantor at
least ten (10) days before the time of the sale or other disposition. If any
notice of any proposed sale,



                                    I-2-B-18
<PAGE>   22

assignment or transfer by the Grantee of any portion of the Collateral or any
interest therein is required by law, the Grantor conclusively agrees that ten
(10) days notice to the Grantor of the date, time and place (and, in the case of
a private sale, the terms) thereof is reasonable.

         SECTION 3.5. Grantee Authorized to Execute Deeds, etc. The Grantor
irrevocably appoints the Grantee (which appointment is coupled with an interest
and is irrevocable by death or otherwise) the true and lawful attorney-in-fact
of the Grantor, in its name and stead and on its behalf, for the purpose of
effectuating any sale, assignment, transfer or delivery for the enforcement
hereof, whether pursuant to power of sale, foreclosure or otherwise, to execute
and deliver all such deeds, bills of sale, assignments, releases and other
instruments as may be designated in any such request.

         SECTION 3.6. Purchase of Collateral by Grantee. The Grantee may be a
purchaser of the Collateral or of any part thereof or of any interest therein at
any public sale thereof, whether pursuant to power of sale, foreclosure or
otherwise, and the Grantee may apply upon the purchase price thereof the
indebtedness secured hereby owing to the Grantee. Such purchaser shall, upon any
such purchase, acquire good title to the properties so purchased, free of the
security interest and lien of this Deed and free of all rights of redemption in
the Grantor.

         SECTION 3.7. Receipt a Sufficient Discharge to Purchaser. Upon any sale
of the Collateral or any part thereof or any interest therein, whether pursuant
to power of sale, foreclosure or otherwise, the receipt of the Grantee or the
officer making the sale under judicial proceedings shall be a sufficient
discharge to the purchaser for the purchase money, and such purchaser shall not
be obliged to see to the application thereof.

         SECTION 3.8. Waiver of Appraisement, Valuation, etc. The Grantor hereby
waives, to the fullest extent it may lawfully do so, the benefit of all
appraisement, valuation, stay, extension and redemption laws now or hereafter in
force and all rights of marshaling in the event of any sale of the Collateral or
any part thereof or any interest therein.

         SECTION 3.9. Sale a Bar Against Grantor. Any sale of the Collateral or
any part thereof or any interest therein under or by virtue of this Deed,
whether pursuant to power of sale, foreclosure or otherwise, shall forever be a
bar against the Grantor.

         SECTION 3.10. Secured Obligations to Become Due on Sale. Except as
otherwise provided in the Credit Agreement, upon any sale of the Collateral or
any portion thereof or interest therein by virtue of the exercise of any remedy
by the Grantee under or by virtue of this Deed, whether pursuant to power of
sale, foreclosure or otherwise in accordance with this Deed or by virtue of any
other remedy available at law or in equity or by statute or otherwise, at the
option of the Grantee, any sums or monies due and payable pursuant to the Credit
Agreement pertaining to the Current Assets Loans, the Loan Documents pertaining
to the Current Assets Loans and in connection with the Current Assets Loans
and/or the Secured Obligations shall, if not previously declared due and
payable, immediately become due and payable, together with interest accrued
thereon, and all other indebtedness which this Deed by its terms secures.

                                    I-2-B-19
<PAGE>   23

         SECTION 3.11. Application of Proceeds of Sale and Other Moneys. Subject
to any applicable requirements of the Financing Order, the Credit Agreement or
the Revolver Intercreditor Agreement, the proceeds of any sale of the Collateral
or any part thereof or any interest therein under or by virtue of this Deed,
whether pursuant to power of sale, foreclosure or otherwise, and all other
moneys at any time held by the Grantee as part of the Collateral, shall be
applied in such order of priority as the Grantee shall determine in its sole and
absolute discretion including, without limitation, as follows:

                  (a) first, to the payment of the reasonable costs and expenses
         of such sale (including, without limitation, the cost of evidence of
         title and the costs and expenses, if any, of taking possession of,
         retaining custody over, repairing, managing, operating, maintaining and
         preserving the Collateral or any part thereof prior to such sale), all
         reasonable costs and expenses incurred by the Grantee or any other
         Person in obtaining or collecting any insurance proceeds, condemnation
         awards or other amounts received by the Grantee, all reasonable costs
         and expenses of any receiver of the Collateral or any part thereof, and
         any Impositions or other charges or expenses prior to the security
         interest or security title of this Deed, which the Grantee may consider
         it necessary or desirable to pay;

                  (b) second, to the payment of any Secured Obligation (other
         than those set forth in Section 3.11(c) below);

                  (c) third, to the payment of all amounts of principal of and
         interest (including Post-Petition Interest to the extent such interest
         is a Secured Obligation) at the time due and payable under the Credit
         Agreement pertaining to the Current Assets Loans at the time
         outstanding (whether due by reason of maturity or by reason of any
         prepayment requirement or by declaration or acceleration or otherwise),
         including interest at the rate provided for in the Credit Agreement on
         any overdue principal and (to the extent permitted under applicable
         law) on any overdue interest; and, in case such moneys shall be
         insufficient to pay in full such principal and interest, then, first,
         to the payment of all amounts of interest (including Post-Petition
         Interest to the extent such interest is a Secured Obligation) at the
         time due and payable and, second, to the payment of all amounts of
         principal at the time due and payable under the Current Assets Loans;
         and

                  (d) fourth, the balance, if any, held by the Grantee after
         payment in full of all amounts referred to in subdivisions Sections
         3.11(a), (b) and (c) above, shall, unless a court of competent
         jurisdiction may otherwise direct by final order not subject to appeal,
         be paid to or upon the direction of the Grantor.

         SECTION 3.12. Appointment of Receiver. If an Event of Default shall
have occurred and be continuing, the Grantee shall, as a matter of right,
without notice, and without regard to the adequacy of any security for the
indebtedness secured hereby or the solvency of the Grantor, be entitled to,
without further order of or application to the Bankruptcy Court, but subject to
any applicable requirements of the Financing Order, the Credit Agreement and the
Revolver Intercreditor Agreement, the appointment of a receiver for all or any
part of the Collateral, whether such receivership be incidental to a proposed
sale of the Collateral or otherwise, and the


                                    I-2-B-20
<PAGE>   24

Grantor hereby consents to the appointment of such a receiver and will not
oppose any such appointment.

         SECTION 3.13. Possession, Management and Income. If an Event of Default
shall have occurred and be continuing, in addition to, and not in limitation of,
the rights and remedies provided in Section 1.14, the Grantee, upon five (5)
days written notice to the Grantor, may, without further order of or application
to the Bankruptcy Court, but subject to any applicable requirements of the
Financing Order, the Credit Agreement and the Revolver Intercreditor Agreement,
enter upon and take possession of the Collateral or any part thereof by force,
summary proceeding, ejectment or otherwise and may remove the Grantor and all
other Persons and any and all property therefrom and may hold, operate,
maintain, repair, preserve and manage the same and receive all earnings, income,
Rents, issues and Proceeds accruing with respect thereto or any part thereof.
The Grantee shall be under no liability for or by reason of any such taking of
possession, entry, removal or holding, operation or management, except that any
amounts so received by the Grantee shall be applied to pay all costs and
expenses of so entering upon, taking possession of, holding, operating,
maintaining, repairing, preserving and managing the Collateral or any part
thereof, and any Impositions or other charges prior to the security title and
security interest of this Deed which the Grantee may consider it necessary or
desirable to pay, and any balance of such amounts shall be applied as provided
in Section 3.11.

         SECTION 3.14. Right of Grantee to Perform Grantor's Covenants, etc. If
the Grantor shall fail to make any payment or perform any act required to be
made or performed hereunder or under the Credit Agreement pertaining to the
Current Assets Loans or any other Loan Document pertaining to the Current Assets
Loans, the Grantee, without further order of or application to the Bankruptcy
Court, without notice to or demand upon the Grantor and without waiving or
releasing any obligation or Event of Default, may (but shall be under no
obligation to) at any time thereafter make such payment or perform such act for
the account and at the expense of the Grantor, and may enter upon the Collateral
for such purpose and take all such action thereon as, in the Grantee's opinion,
may be necessary or appropriate therefor. No such entry and no such action shall
be deemed an eviction of any lessee of the Property or any part thereof. All
sums so paid by the Grantee and all costs and expenses (including, without
limitation, attorneys' fees and expenses) so incurred, together with interest
thereon at the rate provided for in Section 3.2.2 of the Credit Agreement from
the date of payment or incurring, shall constitute additional indebtedness under
the Credit Agreement secured by this Deed and shall be paid by the Grantor to
the Grantee on demand.

         SECTION 3.15. Subrogation. To the extent that the Grantee, on or after
the date hereof, pays any sum due under any provision of any Legal Requirement
or any instrument creating any lien or security title prior or superior to the
lien or security title of this Deed, or the Grantor or any other Person pays any
such sum with the proceeds of the Current Assets Loans, the Grantee shall have
and be entitled to a lien or security title on the Collateral equal in priority
to the lien or security title discharged, and the Grantee shall be subrogated
to, and receive and enjoy all rights and liens or security titles possessed,
held or enjoyed by, the holder of such lien or security title, which shall
remain in existence and benefit the Grantee in securing the Secured Obligations.


                                    I-2-B-21
<PAGE>   25

         SECTION 3.16. Remedies, etc., Cumulative. Each right, power and remedy
of the Grantee provided for in this Deed, the Credit Agreement or any other Loan
Document pertaining to the Current Assets Loans, or now or hereafter existing at
law or in equity or by statute or otherwise shall be cumulative and concurrent
and shall be in addition to every other right, power or remedy provided for in
this Deed, the Credit Agreement or any other Loan Document pertaining to the
Current Assets Loans, or now or hereafter existing at law or in equity or by
statute or otherwise, and the exercise or beginning of the exercise by the
Grantee of any one or more of the rights, powers or remedies provided for in
this Deed, the Credit Agreement, or any other Loan Document pertaining to the
Current Assets Loans, or now or hereafter existing at law or in equity or by
statute or otherwise shall not preclude the simultaneous or later exercise by
the Grantee of any or all such other rights, powers or remedies.

         SECTION 3.17. Provisions Subject to Applicable Law. All rights, powers
and remedies provided in this Deed may be exercised only to the extent that the
exercise thereof does not violate any applicable provisions of law and are
intended to be limited to the extent necessary so that they will not render this
Deed invalid, unenforceable or not entitled to be recorded, registered or filed
under the provisions of any applicable law. If any term of this Deed or any
application thereof shall be invalid or unenforceable, the remainder of this
Deed and any other application of such term shall not be affected thereby.

         SECTION 3.18. No Waiver, etc. No failure by the Grantee to insist upon
the strict performance of any term hereof or of the Credit Agreement, or of any
other Loan Document, or to exercise any right, power or remedy consequent upon a
breach hereof or thereof, shall constitute a waiver of any such term or of any
such breach. No waiver of any breach shall affect or alter this Deed, which
shall continue in full force and effect with respect to any other then existing
or subsequent breach. By accepting payment or performance of any amount or other
Secured Obligations secured hereby before or after its due date, the Grantee
shall not be deemed to have waived its right either to require prompt payment or
performance when due of all other amounts and Secured Obligations payable
hereunder or to declare a default for failure to effect such prompt payment.

         SECTION 3.19. Compromise of Actions, etc. Any action, suit or
proceeding brought by the Grantee pursuant to any of the terms of this Deed, the
Credit Agreement pertaining to the Current Assets Loans, any other Loan Document
pertaining to the Current Assets Loans, or otherwise, and any claim made by the
Grantee hereunder or thereunder, may be compromised, withdrawn or otherwise
dealt with by the Grantee without any notice to or approval of the Grantor.

         SECTION 3.20 Foreclosure - Authority Lease. If action is brought to
foreclose this Deed, the rents, income and profits issuing from the Land and the
Improvements shall be collected either through a receiver appointed by the court
after notice of application for such appointment has been given to the Lessor
under the Authority Lease or by Grantee. Notwithstanding anything to the
contrary contained in this Deed, all such money collected shall be first applied
for the payment of the rent due and owing under the Authority Lease or to become
due and owing to the Lessor under the Authority Lease, then for any ad valorem
taxes, insurance premiums or other charges due and payable under the Authority
Lease and for all other


                                    I-2-B-22
<PAGE>   26

maintenance and operating charges and disbursements incurred in connection with
the operation and maintenance of the Land and the Improvements. The balance of
such monies shall be applied pursuant to the terms of this Deed.

                                   ARTICLE IV

                                   DEFINITIONS

         SECTION 4.1. Terms Defined in this Deed. When used herein the following
terms have the following meanings:

         "Borrowers" shall have the meaning set forth in the third recital.

         "Collateral" shall have the meaning set forth in the granting clause.

         "Contracts" shall have the meaning set forth in clause (h) of the
granting clause.

         "Credit Agreement" shall have the meaning set forth in the third
recital.

         "Credit Extensions" shall have the meaning set forth in the third
recital.

         "Default" means any Event of Default or any condition or event which,
after notice or lapse of time, or both, would constitute an Event of Default

         "Goods" shall have the meaning set forth in clause (c) of the granting
clause.

         "Herein", "hereof", "hereto", and "hereunder" and similar terms refer
to this Deed and not to any particular Section, paragraph or provision of this
Deed.

         "Impositions" shall have the meaning set forth in Section 1.5.

         "Improvements" shall have the meaning set forth in clause (b) of the
granting clause.

         "Indemnified Parties" shall have the meaning set forth in Section 1.16.

         "Insurance Requirements" shall have the meaning set forth in paragraph
(a) of Section 1.6.

         "Land" shall have the meaning set forth in the second recital.

         "Leases" shall have the meaning set forth in clause (e) of the granting
clause.

         "Legal Requirements" shall have the meaning set forth in paragraph (b)
of Section 1.6.

         "Deed" shall have the meaning set forth in the preamble.


                                    I-2-B-23
<PAGE>   27

         "Grantee" shall have the meaning set forth in the preamble.

         "Grantor" shall have the meaning set forth in the preamble.

         "Permits" shall have the meaning set forth in clause (g) of the
granting clause.

         "Permitted Encumbrances" shall have the meaning set forth in Section
1.2.

         "Person" means a corporation, an association, a partnership, an
organization, a business, an individual, a government or political subdivision
thereof or a governmental agency or officer.

         "Plans" shall have the meaning set forth in clause (f) of the granting
clause.

         "Post-Petition Interest" shall have the meaning set forth in Section
2.3.

         "Proceeds" shall have the meaning set forth in clause (k) of the
granting clause.

         "Property" shall have the meaning set forth in clause (b) of the
granting clause.

         "Real Estate" shall have the meaning set forth in clause (a) of the
granting clause.

         "Rents" shall have the meaning set forth in clause (i) of the granting
clause.

         "Secured Obligations" means the Current Assets Obligations and all
Obligations with respect to the Current Assets Loans now or hereafter existing
under the Credit Agreement or any Loan Document pertaining to the Current Assets
Loans, and all obligations (monetary or otherwise) arising under or in
connection with the Current Assets Notes or the Current Assets Loans, whether
for principal, interest, costs, fees, expenses or otherwise and all other
Current Assets Obligations, all advances, if any, made by Grantee pursuant to
the terms of this Deed, and all duties and obligations of Grantor under this
Deed.

         "State" means the State of Georgia.

         "Total Destruction" means any damage to or destruction of the
Improvements or any part thereof which, in the reasonable estimation of the
Grantee shall require the expenditure of an amount in excess of Ten Million
Dollars ($10,000,000) to restore the Improvements to substantially the same
condition of the Improvements immediately prior to such damage or destruction.

         "Total Taking" means a Taking, whether permanent or for temporary use,
which, in the reasonable judgment of the Grantee, shall substantially interfere
with and adversely affect the normal operation of the Property by the Grantor to
such an extent as would reasonably be anticipated to cause a Material Adverse
Effect.

          SECTION 4.2. Use of Defined Terms. Terms for which meanings are
provided in this Deed shall, unless otherwise defined or the context otherwise
requires, have such meanings when

                                    I-2-B-24
<PAGE>   28

used in any certificate and any opinion, notice or other communication delivered
from time to time in connection with this Deed or pursuant hereto.

          SECTION 4.3. Credit Agreement Definitions. Unless otherwise defined
herein or the context otherwise requires, capitalized terms used in this Deed,
including its preamble and recitals, have the meanings provided in the Credit
Agreement.

                                    ARTICLE V

                                  MISCELLANEOUS

         SECTION 5.1. Further Assurances; Financing Statements.

         SECTION 5.1.1. Further Assurances. The Grantor, at its expense, will
execute, acknowledge and deliver all such instruments and take all such other
action as the Grantee from time to time may reasonably request:

                  (a) to better subject to the security title and security
         interest of this Deed all or any portion of the Collateral,

                  (b) to perfect, publish notice or protect the validity of the
         security title and security interest of this Deed,

                  (c) to preserve and defend the title to the Collateral and the
         rights of the Grantee therein against the claims of all Persons as long
         as this Deed shall remain undischarged,

                  (d) to better subject to the security title and security
         interest of this Deed or to maintain or preserve the lien and security
         interest of this Deed with respect to any replacement or substitution
         for any Collateral or any other after-acquired property except as
         provided in the Credit Agreement, or

                  (e) in order to further effectuate the purposes of this Deed
         and to carry out the terms hereof and to better assure and confirm to
         the Grantee its rights, powers and remedies hereunder.

          SECTION 5.1.2. Financing Statements. Notwithstanding any other
provision of this Deed, the Grantor hereby agrees that, without notice to or the
consent of the Grantor, the Grantee may file with the appropriate public
officials such financing statements, continuation statements, amendments and
similar documents as are or may become necessary to perfect, preserve or protect
the security interest granted by this Deed

          SECTION 5.2. Additional Security. Without notice to or consent of the
Grantor, and without impairment of the security interest and security title and
rights created by this Deed, the Grantee and the Lenders may, without further
order of or application to the Bankruptcy Court, accept from the Grantor or any
other Person additional security for the Secured Obligations.


                                    I-2-B-25
<PAGE>   29

Neither the giving of this Deed nor the acceptance of any such additional
security shall prevent the Grantee from resorting, first, to such additional
security, or, first, to the security created by this Deed, or concurrently to
both, in any case without affecting the Grantee's security title and rights
under this Deed.

         SECTION 5.3. Satisfaction; Partial Release, etc.

         SECTION 5.3.1. Satisfaction. If the Current Assets Loans and all other
amounts owing pursuant to the Credit Agreement pertaining to the Current Assets
Loans and the other Loan Documents pertaining to the Current Assets Loans shall
be repaid in full in accordance with the terms thereof, and if the Grantor shall
pay, in full, the principal of and premium, if any, and interest on the Secured
Obligations in accordance with the terms thereof and hereof and all other sums
payable hereunder by the Grantor and shall comply with all the terms, conditions
and requirements hereof and of the Secured Obligations, or otherwise as may be
provided in the Credit Agreement, then on such date, the Grantee shall, upon the
request of the Grantor and at the Grantor's sole cost and expense, execute and
deliver such instruments, in form and substance reasonably satisfactory to the
Grantee, as may be necessary to effectively cancel and surrender this Deed;
provided, however, this Deed secures a revolving credit facility pursuant to the
Credit Agreement and there may be repayment and disbursements of principal from
time to time as provided in the Credit Agreement. It is expressly agreed that
the outstanding principal balance of the Secured Obligations may, from time to
time, be reduced to a zero balance without such repayment operating to
extinguish and release the security title and security interest created by this
Deed. This Deed shall remain in full force and effect as to any subsequent
future advances made after the zero balance without loss of priority until the
Secured Obligations have been paid in full and satisfied and all agreements
between Grantee and Grantor for further advances pursuant to the Credit
Agreement have been terminated and this Deed is cancelled of record. To the
extent it can legally do so, Grantor hereby waives the operation of any
applicable statute, law or regulation having a contrary effect.

         SECTION 5.3.2. Partial Release, etc. The Grantee may, at any time and
from time to time, without liability therefor, and without prior notice to the
Grantor, release or reconvey any part of the Collateral, consent to the making
of any map or plat of the Property, join in granting any easement thereon or
join in any extension agreement or agreement subordinating the security title
and security interest of this Deed.

         SECTION 5.4. Notices, etc. All notices and other communications
provided to any of the parties hereto shall be in writing and addressed,
delivered or transmitted to such party as set forth in the Credit Agreement

         SECTION 5.5. Waivers, Amendments, etc. The provisions of this Deed may
be amended, discharged or terminated and the observance or performance of any
provision of this Deed may be waived, either generally or in a particular
instance and either retroactively or prospectively, only by an instrument in
writing executed by the Grantor and the Grantee.

         SECTION 5.6. Cross-References. References in this Deed and in each
instrument executed pursuant hereto to any Section or Article are, unless
otherwise specified, to such



                                    I-2-B-26
<PAGE>   30

Section or Article of this Deed or such instrument, as the case may be, and
references in any Section, Article or definition to any clause are, unless
otherwise specified, to such clause of such Section, Article or definition.

         SECTION 5.7. Headings. The various headings of this Deed and of each
instrument executed pursuant hereto are inserted for convenience only and shall
not affect the meaning or interpretation of this Deed or such instrument or any
provisions hereof or thereof.

         SECTION 5.8. Currency. Unless otherwise expressly stated, all
references to any currency or money, or any dollar amount, or amounts
denominated in "Dollars" herein will be deemed to refer to the lawful currency
of the United States.

         SECTION 5.9. Governing Law. THIS DEED SHALL BE DEEMED TO BE A CONTRACT
MADE UNDER AND GOVERNED BY THE LAWS OF THE STATE.

         SECTION 5.10. Successors and Assigns. etc. This Deed shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors, successors-in-title and assigns.

         SECTION 5.11. Waiver of Jury Trial; Submission to Jurisdiction.

                  (a) EACH OF THE GRANTOR AND THE GRANTEE HEREBY KNOWINGLY,
         VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL
         BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON OR ARISING OUT OF,
         UNDER OR IN CONNECTION WITH THIS DEED, THE CREDIT AGREEMENT, ANY LOAN
         DOCUMENT OR ANY OTHER RELATED INSTRUMENT, OR ANY COURSE OF CONDUCT,
         COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN), OR ACTIONS OF
         THE GRANTOR OR THE GRANTEE. THIS PROVISION IS A MATERIAL INDUCEMENT FOR
         THE GRANTEE AND THE CURRENT ASSETS LENDERS TO ENTER INTO THE
         TRANSACTIONS PROVIDED FOR IN THE CREDIT AGREEMENT AND TO MAKE THE
         CURRENT ASSETS LOANS.

                  (b) FOR THE PURPOSE OF ANY ACTION OR PROCEEDING INVOLVING THIS
         DEED, THE CREDIT AGREEMENT AS PERTAINS TO THE CURRENT ASSETS LOANS OR
         ANY OTHER LOAN DOCUMENT AS PERTAINS TO THE CURRENT ASSETS LOANS, THE
         GRANTOR HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE
         JURISDICTION OF ALL FEDERAL AND STATE COURTS LOCATED IN THE STATE AND
         CONSENTS THAT IT MAY BE SERVED WITH ANY PROCESS OR PAPER BY REGISTERED
         MAIL OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE IN ACCORDANCE
         WITH APPLICABLE LAW, PROVIDED A REASONABLE TIME FOR APPEARANCE IS
         ALLOWED. THE GRANTOR AND GRANTEE EACH EXPRESSLY WAIVES, TO THE EXTENT
         IT MAY LAWFULLY DO SO, ANY OBJECTION, CLAIM OR DEFENSE WHICH IT MAY
         HAVE AT ANY TIME TO THE LAYING OF VENUE OF ANY ACTION, SUIT OR
         PROCEEDING



                                    I-2-B-27
<PAGE>   31

         ARISING OUT OF THIS DEED, THE CREDIT AGREEMENT OR ANY OTHER LOAN
         DOCUMENT IN ANY SUCH COURT, IRREVOCABLY WAIVES ANY CLAIM THAT ANY SUCH
         SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT
         IN AN INCONVENIENT FORUM AND FURTHER IRREVOCABLY WAIVES THE RIGHT TO
         OBJECT, WITH RESPECT TO ANY SUCH CLAIM, SUIT, ACTION OR PROCEEDING
         BROUGHT IN ANY SUCH COURT, THAT SUCH COURT DOES NOT HAVE JURISDICTION
         OVER THE PERSON OF THE GRANTOR NOTHING CONTAINED HEREIN WILL BE DEEMED
         TO PRECLUDE THE GRANTEE FROM BRINGING AN ACTION AGAINST THE GRANTOR IN
         ANY OTHER JURISDICTION.

         SECTION 5.12. Severability; Conflicts. Any provision of this Deed, the
Credit Agreement or any other Loan Document which is prohibited or unenforceable
in any jurisdiction shall as to such provision and such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions of this Deed, the Credit Agreement or such
Loan Document or affecting the validity or enforceability of such provision in
any other jurisdiction. In the event of any conflict between the terms of this
Deed and the terms of the Credit Agreement, the terms of the Credit Agreement
shall control.

         SECTION 5.13. Loan Document. This Deed is a Loan Document executed
pursuant to the Credit Agreement and, unless otherwise expressly indicated
herein, shall be construed, administered and applied in accordance with the
terms and provisions thereof.

         SECTION 5.14. Usury Savings Clause. It is the intention of the Grantor
and the Grantee to conform strictly to the usury laws governing the Loan
Documents, and any interest payable under the Loan Documents shall be subject to
reduction to the amount not in excess of the maximum non-usurious amount allowed
under such laws, as construed by the courts having jurisdiction over such
matters. In the event the maturity of the Secured Obligations is accelerated by
reason of any provision of the Loan Documents, or by reason of an election by
the Grantee resulting from an Event of Default, then earned interest may never
include more than the maximum amount permitted by law, computed from the dates
of each advance of loan proceeds under the Credit Agreement until payment, and
any interest in excess of the maximum amount permitted by law shall be canceled
automatically or, if theretofore paid, at the option of the Grantee, shall be
rebated to the Grantor, or shall be credited on the principal amount of the
Secured Obligations or, if all principal has been repaid, then the excess shall
be rebated to the Grantor. If any interest is canceled, credited against
principal or rebated to the Grantor in accordance with the foregoing sentence
and, if thereafter the interest payable hereunder is less than the maximum
amount permitted by applicable law, the rate hereunder shall automatically be
increased to the maximum extent possible to permit repayment to the Grantee and
the Lenders as soon as possible of any interest in excess of the maximum amount
permitted by law which was earlier canceled, credited against principal or
rebated to the Grantor pursuant to the provisions of the foregoing sentence.

         SECTION 5.15. Future Advances. This Deed is a "Future Advance Deed"
under the laws of the State. Any and all future advances under this Deed and the
Loan Documents pertaining to the Current Assets Loans shall have the same
priority as if the future advance was



                                    I-2-B-28
<PAGE>   32

made on the date that this Deed was recorded. This Deed shall secure the Secured
Obligations, whenever incurred, such Secured Obligations to be due at the times
provided in the Loan Documents pertaining to the Current Assets Loans. Notice is
hereby given that the Secured Obligations may increase as a result of any
defaults hereunder by Grantor due to, for example, and without limitation,
unpaid interest or late charges, unpaid taxes or insurance premiums which the
Grantee elects to advance, defaults under leases that the Grantee elects to
cure, attorney fees or costs incurred in enforcing the Loan Documents pertaining
to the Current Assets Loans or other expenses incurred by the Grantee in
protecting the Collateral, the security of this Deed or the Grantee's rights and
interests.

         SECTION 5.16. Co-Agent. The rights, powers, duties and obligations
conferred or imposed upon CIT under the Credit Agreement pursuant to this Deed
with respect to the Collateral (including, without limitation, holding the
security title hereunder) are hereby conferred and imposed upon the Georgia
Agent to the extent, but only to the extent, that pursuant to the laws of the
State in effect from time to time CIT shall be incompetent or unqualified to
exercise or perform such rights, power, duties and obligations.

         SECTION 5.17. Deed Subject to Revolver Intercreditor Agreement.
Notwithstanding anything to the contrary contained herein, it is expressly
understood and agreed by the parties hereto that this Deed shall be subject to
the terms of the Revolver Intercreditor Agreement.


              [REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]



                                    I-2-B-29
<PAGE>   33



         IN WITNESS WHEREOF, the undersigned, by its duly elected officers and
pursuant to proper authority of its board of directors has duly executed,
sealed, acknowledged and delivered this Current Assets Secured Parties Leasehold
Deed to Secure Debt, Assignment and Security Agreement as of the day and year
first above written.

                                           STERLING PULP CHEMICALS, INC.,
                                           a Georgia corporation



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

                                                       [CORPORATE SEAL]

Signed, sealed and delivered in the presence of:


-----------------------------------
Unofficial Witness




                                   DRAFTED BY:

                                 Baker Botts LLP
                           2001 Ross Avenue, Suite 600
                               Dallas, Texas 75201
                       Attention: R. Christian Brose, Esq.


<PAGE>   34

[CORPORATION NOTARY PAGE]


STATE OF                            )
         ------------               )
COUNTY OF                           )
          -----------               )


         BEFORE ME, the undersigned, a notary public in and for the State of
____________, on this day personally appeared ___________________________ as
_______________________ of STERLING PULP CHEMICALS, INC., a Georgia corporation,
and, being known to me to be the person whose name is subscribed to the
foregoing instrument, acknowledged to me that he executed the same for the
purpose and consideration therein expressed and on behalf of said corporation.

         Given under my hand and seal of office this ___ day of July, 2001.



                                    Notary Public, State of
                                                            --------------------
                                    Date commission expires: