ALLSTATE LIFE INSURANCE COMPANY
                                 LOAN NO. 121873

         MORTGAGE, ASSIGNMENT OF LEASES,

    RENTS AND CONTRACTS, SECURITY AGREEMENT

                         AND

                   FIXTURE FILING

                       BETWEEN

    AG-CHEM EQUIPMENT CO., INC. AS MORTGAGOR,

                         AND

ALLSTATE LIFE INSURANCE COMPANY AS MORTGAGEE

                  DATED: SEPTEMBER ____, 2000

                  LOAN AMOUNT: $9,000,000.00

                  PROPERTY ADDRESS:
                  5720 Smetana Drive (Brenwood I)
                  5700 Smetana Drive (Brenwood II)
                  5640 Smetana Drive (Brenwood III)
                  5620 Smetana Drive (Brenwood IV)
                  Minnetonka
                  Hennepin County
                  Minnesota 55343-9688


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ARTICLE        SECTION             DESCRIPTION                       PAGE NUMBER
-------        -------             -----------                       -----------
I     COVENANTS OF MORTGAGOR

               1.01     Performance of Obligations Secured                   8
               1.02     Insurance                                            8
               1.03     Condemnation                                         9
               1.04     Damage to Property                                  10
               1.05     Escrow Fund for Condemnation
                              and Insurance Proceeds                        12
               1.06     Taxes, Liens and other Items                        14
               1.07     Assignment of Leases, Contracts,
                              Rents and Profits                             15
               1.08     Acceleration Upon Sale or
                              Encumbrance                                   18
               1.09     Preservation and Maintenance of
                              Property                                      19
               1.10     Offset Certificates                                 20
               1.11     Mortgagee's Costs and Expenses                      20
               1.12     Protection of Security; Costs
                              and Expenses                                  20
               1.13     Mortgagor's Covenants Respecting
                              Collateral                                    21
               1.14     Covenants Regarding Financial
                              Statements                                    22
               1.15     Environmental Covenants                             24
               1.16     Exclusions from Collateral and Contracts            25

II    EVENTS OF DEFAULT

               2.01     Monetary and Performance Defaults                    25
               2.02     Bankruptcy, Insolvency, Dissolution                  26
               2.03     Misrepresentation                                    26
               2.04     Default under Subordinate Loans                      27

III   REMEDIES

               3.01     Acceleration                                         27
               3.02     Entry                                                27
               3.03     Judicial Action                                      29
               3.04     Power of Sale                                        29
               3.05     Rescission of Notice of Default                      30
               3.06     Mortgagee's Remedies Respecting


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                             Collateral                                      30
              3.07      Proceeds of Sales                                    30
              3.08      Condemnation and Insurance Proceeds                  31
              3.09      Waiver of Marshalling, Right of
                             Redemption, Homestead and
                             Valuation                                       32
              3.10      Remedies Cumulative                                  32
              3.11      Limited Recourse                                     32
              3.12      Evasion of Prepayment Premium                        33

IV    MISCELLANEOUS

              4.01      Severability                                         33
              4.02      Certain Charges and Brokerage
                             Fees                                            34
              4.03      Notices                                              34
              4.04      Mortgagor Not Released; Certain
                             Mortgagee Acts                                  35
              4.05      Inspection                                           36
              4.06      Release or Satisfaction                              36
              4.07      Statute of Limitations                               36
              4.08      Interpretation                                       36
              4.09      Captions                                             36
              4.10      Consent                                              36
              4.11      Delegation to Subagents                              36
              4.12      Successors and Assigns                               37
              4.13      Governing Law                                        37
              4.14      Changes in Taxation                                  37
              4.15      Maximum Interest Rate                                37
              4.16      Time of Essence                                      37
              4.17      Reproduction of Documents                            37
              4.18      No Oral Modifications                                38
              4.19      Future Advances                                      38
              4.20      Commercial Property                                  38
                        Signature Page                                       39


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         MORTGAGE, ASSIGNMENT OF LEASES, RENTS AND CONTRACTS,
                  SECURITY AGREEMENT AND FIXTURE FILING

         THIS MORTGAGE, ASSIGNMENT OF LEASES, RENTS AND CONTRACTS, SECURITY
AGREEMENT AND FIXTURE FILING is made as of this _____ day of September, 2000,
from AG-CHEM EQUIPMENT CO., INC., a Minnesota corporation, whose mailing address
is 5720 Smetana Drive, Minnetonka, Minnesota 55343-9688 (herein "Mortgagor"), in
favor of ALLSTATE LIFE INSURANCE COMPANY a corporation, whose mailing address is
Allstate Plaza South, Suite G5C, 3075 Sanders Road, Northbrook, Illinois, 60062
(herein "Mortgagee").

         In consideration of the indebtedness herein recited and as security for
payment and performance of the payment of both principal and interest and the
other obligations set forth below, Mortgagor hereby irrevocably grants, conveys,
transfers and assigns to Mortgagee, its successors and assigns, with power of
sale and right of entry and possession, all of Mortgagor's estate, right, title,
and interest in, to and under that certain real property located in the City of
Minnetonka, County of Hennepin, State of Minnesota, more particularly described
in Exhibit A attached hereto and incorporated herein by reference (the "Land");

         TOGETHER with all of Mortgagor's now or hereafter acquired estate,
right, title and interest in, to and under all buildings, structures,
improvements and fixtures now existing or hereafter erected on the Land and all
right, title and interest, if any, of Mortgagor in and to the streets and roads,
opened or proposed, abutting the Land to the center lines thereof, and strips
within or adjoining the Land, the air space and right to use said air space
above the Land, all rights of ingress and egress on or within the Land, all
easements, rights and appurtenances thereto or used in connection with the Land,
including, without limitation, air lateral support, alley and drainage rights,
all revenues, income, rents, cash or security deposits, advance rental deposits,
profits, royalties, and other benefits thereof or arising from the use or
enjoyment of all or any portion thereof (subject however to the rights and
authorities given herein to Mortgagor to collect and apply such revenues, and
other benefits), all interests in and rights, royalties and profits in
connection with all minerals, oil and gas and other hydrocarbon substances
thereon or therein, and water stock, all options to purchase or lease, all
development or other rights relating to the Land or the operation thereof, or
used in connection therewith, including all Mortgagor's right, title and
interest in all fixtures, attachments, partitions, machinery, equipment,
building materials, appliances and goods of every nature whatever now or
hereafter located on, or attached to, the Land, all of which, including
replacements and additions thereto, shall, to the fullest extent permitted by
law and for the purposes of this Mortgage, be deemed to be real property and,
whether affixed or annexed thereto or not, be deemed conclusively to be real
property; and Mortgagor agrees to execute and deliver, from time to time, such
further instruments and documents as may be required by Mortgagee to confirm the
legal operation and effect of this Mortgage on any of the foregoing. All of the
foregoing property described in this

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section (the "Improvements") together with the Land, shall be hereinafter
defined Collateral shall be hereinafter referred to as the "Property".

         TOGETHER with all of Mortgagor's now existing or hereafter acquired
right, title and interest in the following:

              (A) All equipment, fixtures, inventory, goods, instruments,
appliances, furnishings, machinery, tools, raw materials, component parts, work
in progress and materials, and all other tangible personal property of
whatsoever kind, used or consumed in the improvement, use or enjoyment of the
Property now or any time hereafter owned or acquired by Mortgagor, wherever
located and all products thereof whether in possession of Mortgagor or whether
located on the Property or elsewhere;

              (B) To the extent such general intangibles are assignable, all
general intangibles relating to design, development, operation, management and
use of the Property, including, but not limited to, (1) all names under which or
by which the Property may at any time be owned and operated or any variant
thereof, and all goodwill in any way relating to the Property and all service
marks and logotypes used in connection therewith, (2) all permits, licenses,
authorizations, variances, land use entitlements, approvals, consents,
clearances, and rights obtained from governmental agencies issued or obtained in
connection with the Property, (3) all permits, licenses, approvals, consents,
authorizations, franchises and agreements issued or obtained in connection with
the construction, use, occupation or operation of the Property, (4) all
materials prepared for filing or filed with any governmental agency, and (5) the
books and records of Mortgagor relating to construction or operation of the
Property;

              (C) All shares of stock or partnership interest or other evidence
of ownership of any part of the Property that is owned by Mortgagor in common
with others, including all water stock relating to the Property, if any, and all
documents or rights of membership in any owners' or members' association or
similar group having responsibility for managing or operating any part of the
Property provided, however, that the foregoing shall not include any ownership
interests in the Mortgagor;

              (D) All accounts, deposit accounts, tax and insurance escrows held
pursuant to this Mortgage, accounts receivable, instruments, documents,
documents of title, general intangibles, rights to payment of every kind, all of
Mortgagor's rights, direct or indirect, under or pursuant to any and all
construction, development, financing, guaranty, indemnity, maintenance,
management, service, supply and warranty agreements, commitments, contracts,
subcontracts, insurance policies, licenses and bonds now or anytime hereafter
arising from construction on the Land or the use or enjoyment of the Property to
the extent such are assignable;

              (E) All condemnation proceeds (including payments in lieu thereof)
and insurance proceeds related to the Property;

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<PAGE>


         TOGETHER with all additions to, substitutions for and the products of
all of the above, and all proceeds therefrom, whether cash proceeds or noncash
proceeds, received when any such property (or the proceeds thereof) is sold,
exchanged, leased, licensed, or otherwise disposed of, whether voluntarily or
involuntarily. Such proceeds shall include any of the foregoing specifically
described property of Mortgagor acquired with cash proceeds. Together with, and
without limiting the above items, all Goods, Accounts, Documents, Instruments,
Money, Chattel Paper and General Intangibles arising from or used in connection
with the Property, as those terms are defined in the Uniform Commercial Code
from time to time in effect in the state in which the Property is located. (All
of the foregoing, including the above-described products and proceeds thereof,
are collectively referred to as "Collateral".)

         MORTGAGOR HEREBY WARRANTS AND REPRESENTS that it is the owner in fee
title to the Property (and the Collateral) free and clear of all liens and
encumbrances except for: the lien for current real estate taxes not yet due and
payable; and such other encumbrances as may have been approved by Mortgagee in
writing on the date of this Mortgage.

         The personal property in which Mortgagee has a security interest
includes goods which are or shall become fixtures on the Property. This Mortgage
is intended to serve as a fixture filing pursuant to the terms of the applicable
provisions of the Uniform Commercial Code of the state in which the Property is
located and the provisions of Exhibit B are, for that purpose, incorporated
herein. This filing is to be recorded in the real estate records of the
appropriate city, town or county in which the Property is located. In that
regard, the following information is provided:

         Names of Debtor: Ag-Chem Equipment Co., Inc., a Minnesota corporation

         Address of Debtor: See section 4.03 hereof

         Name of Secured Party: Allstate Life Insurance Company, an Illinois
         insurance corporation

         Address of Secured Party: See section 4.03 hereof.

         This document covers goods which are or are to become fixtures.

         The name of the record owner of the Property is the Debtor described
         above.

         Mortgagor's tax identification or social security number: 41-0872842

         Mortgagor warrants and agrees that there is no financing, statement
covering the foregoing Collateral, the Property, or any part thereof, on file
in any public office.

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         HOWEVER, THIS IS A MORTGAGE, AND THIS CONVEYANCE IS MADE FOR THE
FOLLOWING USES, AND FOR NO OTHER PURPOSES, AND FOR THE PURPOSE OF SECURING, IN
SUCH ORDER OF PRIORITY AS MORTGAGEE MAY ELECT:

         (A) The repayment of the indebtedness evidenced by that certain
Mortgage Note ("Note") of even date herewith with a maturity date of October 1,
2010 executed by Mortgagor and payable to the order of Mortgagee, in the
principal sum of Nine Million and no/100 DOLLARS ($9,000,000.00) with interest
thereon, as provided therein and all late charges, loan fees, commitment fees,
Prepayment Premiums (as described in the Note), and all extensions, renewals,
modifications, amendments and replacements thereof;

         (B) The payment of all other sums which may be advanced by or otherwise
be due to Mortgagee under any provision of this Mortgage or under any other
instrument or document referred to in clause (C) below, with interest thereon at
the rate provided herein or therein;

         (C) The performance of each and every covenant and agreement of
Mortgagor contained (1) herein, in the Note, or in any note evidencing a Future
Advance (as hereinafter defined), and (2) in the obligations of Mortgagor upon
any and all pledge or other security agreements, loan agreements, disbursement
agreements, supplemental agreements (the foregoing shall not include the
Commitment Letter between Mortgagor and Mortgagee), assignments (both present
and collateral) and all instruments of indebtedness or security now or hereafter
executed by Mortgagor in connection with any indebtedness referred to in clauses
(A), (B) or (D) of this section including but not limited to the Assignment of
Leases and Rents or for the purpose of supplementing or amending this Mortgage
or any instrument secured hereby (all of the foregoing in this clause (C), as
the same may be amended, modified or supplemented from time to time, being
referred to hereinafter as "Related Agreements") and all costs and expenses,
including reasonable attorneys' fees with respect to all such documents,
including, without limitation, the negotiation and drafting of any loan
settlement or workout agreement; and

         (D) The repayment of any other loans or advances, with interest
thereon, hereafter made to Mortgagor (or any successor in interest to Mortgagor
as the owner of the Property or any part thereof) by Mortgagee when the
promissory note evidencing the loan or advance specifically states that said
note is secured by this Mortgage, together with all extensions, renewals,
modifications, amendments and replacements thereof (herein and in the Related
Agreements "Future Advance")

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                                    ARTICLE I
                             COVENANTS OF MORTGAGOR

         To protect the security of this Mortgage, Mortgagor covenants and
agrees as follows:

         1.01. Performance of Obligations Secured. Mortgagor shall promptly pay
when due the principal of and interest on the indebtedness evidenced by the
Note, the principal of and interest on any Future Advance, any Prepayment
Premium and late charges provided for in the Note or in any note evidencing a
Future Advance, and shall further perform fully and in a timely manner all other
obligations of Mortgagor contained herein or in the Note or in any note
evidencing a Future Advance or in any of the Related Agreements.

         1.02. Insurance. For all times during the period there remains any
indebtedness under the Note, or any and all other indebtedness (including
without limitation Future Advances) secured by this Mortgage, Mortgagor shall
keep the Property insured against all risks or hazards as Mortgagee may require.
Such insurance shall be in policy form, amount and coverage satisfactory to
Mortgagee, including, but not limited to:

              (A) Fire and extended coverage property damage insurance,
including, but not limited to all risk insurance, in an amount equal to the full
replacement value of the Improvements, without coinsurance or deducting for
depreciation, containing a waiver of subrogation clause and a deductible amount
acceptable to Mortgagee;

              (B) Public liability insurance, in such form, amount and
deductible satisfactory to Mortgagee, and naming Mortgagee c/o Mortgagee's
servicing agent, if any, as additional insured covering Mortgagee's interest in
the Property;

              (C) Business interruption or rent loss insurance endorsement in an
amount at least equal to one hundred percent (100%) of the sum of: annual debt
service on the Note, the annual debt service on any other financing permitted by
Mortgagee, ground rents, if any, and operating expenses, including, without
limitation, real estate taxes and assessments and insurance, for the Property;

              (D) Flood insurance required by and obtainable through the
National Flood Insurance Program sufficient to cover any damage which may be
anticipated in the event of flood unless Mortgagor has provided Mortgagee
evidence satisfactory to Mortgagee that no portion of the Property is located
within the boundaries of the one hundred (100) year flood plain;

              (E) "Dram shop" insurance if alcoholic beverages are sold on the
Property;

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              (F) Boiler and machinery insurance when risks covered thereby are
present and Mortgagee requires such insurance; and

              (G) Earthquake insurance if Mortgagee requires such insurance.

The insurance coverages described in subsections (A), (C), (D), (F) and (G)
above shall name Mortgagee c/o Mortgagee's servicing agent, if any, under a
standard noncontributory mortgagee clause or otherwise directly insure
Mortgagee's interest in the Property. All losses under said insurance shall be
payable to Mortgagee in the manner provided in sections 1.04 and 1.05 hereof.
All policies of insurance required under this section 1.02 shall be with a
company or companies with a policy rating of A and financial rating of at least
Class X in the most current edition of Best's Insurance Reports and authorized
to do business in the state in which the Property is located. All policies of
insurance shall provide that they will not be canceled or modified without
thirty (30) days' prior written notice to Mortgagee. True copies of the above
mentioned insurance policies or evidence of such insurance (in the form of
Accord Form 27) satisfactory to Mortgagee shall be delivered to and held by
Mortgagee. True copies of all renewal and replacement policies or evidences of
such insurance forms (Accord Form 27) thereof shall be delivered to Mortgagee at
least thirty (30) days before the expiration of the expiring policies. If any
renewal or replacement policy is not obtained as required herein, Mortgagee is
authorized to obtain the same in Mortgagor's name and at Mortgagor's expense.
Mortgagee shall not by the fact of failing to obtain any insurance, incur any
liability for or with respect to the amount of insurance carried, the form or
legal sufficiency of 'insurance contracts, solvency of insurance companies, or
payment or defense of lawsuits, and Mortgagor hereby expressly assumes full
responsibility therefor and all liability, if any, with respect thereto.

         1.03. Condemnation.

              (A) Immediately upon obtaining knowledge of the commencement or
threat of any action in connection with (1) any condemnation, (2) any other
taking of the Property or any part thereof by any public authority or private
entity having the power of eminent domain, or (3) any conveyance in lieu of such
condemnation or taking of the Property or any part thereof ("Condemnation"),
Mortgagor shall notify Mortgagee in writing but in no event later than ten (10)
days after Mortgagor obtains knowledge of the commencement of or threat of a
Condemnation. Mortgagee shall have the right, but not the obligation, to
participate in any proceedings relating to any Condemnation and may, in its sole
discretion, consent or withhold its consent to any settlement, adjustment, or
compromise of any claims arising from the Condemnation and no such settlement,
adjustment or compromise shall be final or binding upon Mortgagee without
Mortgagee's prior consent.

              (B) If all or part of the Property is taken by Condemnation and
Mortgagee in its reasonable iudgment determines that the remainder of the
Property, if any, cannot be operated as an economically viable entity at
substantially the same level of operations as immediately prior to such
Condemnation, then all proceeds of the Condemnation ("Condemnation Proceeds")
shall be paid over to Mortgagee and shall be applied first toward reimbursement
of the costs and

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expenses (including reasonable attorneys' fees) of Mortgagee, if any, in
connection with the recovery of such Condemnation Proceeds, and then, in the
sole and absolute discretion of Mortgagee and without regard to the adequacy of
its security under this Mortgage, shall be applied against all amounts due
herein or under the Note and any remaining Condemnation Proceeds shall be
released to the Mortgagor. Partial prepayment of the Note under this section
1.03(B) shall not be subject to the Prepayment Premium; however, such partial
prepayment shall not entitle Mortgagor to prepay the portion of the Note
remaining unpaid after application of the Condemnation Proceeds. Prepayment of
the balance shall continue to be subject to the terms and conditions of the
Note, including the No-Prepayment Period and the Prepayment Premium described
therein.

              (C) If less than all of the Property is taken by Condemnation and
Mortgagee in its reasonable judgment determines that the remainder of the
Property can be operated as an economically viable entity at substantially the
same level of operations as immediately prior to such Condemnation, then
Mortgagor shall diligently restore the Property to a condition and use as close
as possible to its condition immediately prior to the Condemnation and all
Condemnation Proceeds shall be made available to Mortgagor for such restoration.
If the estimated cost of restoration, as reasonably determined by Mortgagee, is
equal to or less than Two Hundred Thousand and 00/100 Dollars ($200,000), all
Condemnation Proceeds shall be released directly to Mortgagor for restoration of
the Property. If the estimated cost of restoration exceeds Two Hundred Thousand
and 00/100 ($200,000), all Condemnation Proceeds shall be deposited into an
escrow fund in accordance with section 1.05 below. Mortgagee shall have the
right to obtain an opinion of an independent contractor or engineer satisfactory
to Mortgagee, at Mortgagor's expense, to estimate the cost to restore the
remaining portion of the Property. If the amount of the Condemnation Proceeds is
not sufficient to restore the Property based on the opinion of an independent
contractor or engineer, subject to revision as restorations are made, Mortgagor
shall be obligated to pay the difference toward the restoration of the Property.

              (D) If an Event of Default exists at any time from the time of a
Condemnation through the completion of restoration and payment of any
Condemnation Proceeds, the use of the Condemnation Proceeds shall be governed
by the remedies set forth in Article III below. If an event has occurred which
with notice, the passage of time, or both, could become an Event of Default,
then, the Condemnation Proceeds shall be held by Mortgagee or in the Escrow
Fund (as defined below), as applicable, pending cure of such event.

         1.04. Damage to Property.

              (A) Promptly upon obtaining knowledge of any damage to the
Property or any part thereof with an estimated cost of restoration in excess of
Five Thousand and 00/100 (S5,000), but in no event later than five (5) days
after Mortgagor obtains such knowledge, Mortgagor shall notify Mortgagee of such
damage in writing. Mortgagor shall diligently restore the Property to the same
condition that existed immediately prior to the damage whether or not insurance
proceeds are sufficient for such restoration. All proceeds of any insurance on
the Property ("Insurance Proceeds") received by Mortgagor shall be applied to
such restoration.

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Mortgagee shall have the right to obtain an opinion of an independent contractor
or engineer satisfactory to Mortgagee, at Mortgagor's expense, to estimate the
cost to restore the Property to its original condition, which opinion may be
revised as restorations are made. If the amount of the insurance proceeds is not
sufficient to restore the Property based on an independent contractor's or
engineer's opinion, subject to revision as restorations are made, Mortgagor
shall be obligated to pay the difference toward the restoration of the Property.

              (B) If the estimated cost of restoration is equal to or less than
Two Hundred Thousand and 00/100 Dollars ($200,000), Mortgagor shall promptly
settle and adjust any claims under the insurance policies which insure against
such risks and, upon receipt of the Insurance Proceeds, Mortgagee shall deliver
such to Mortgagor for use in restoration of the Property.

              (C) If the estimated cost of restoration is greater than Two
Hundred Thousand and 00/100 ($200,000), Mortgagee shall have the right, but not
the obligation, to participate in the settlement of the insurance claims and
may, in its sole discretion, consent or withhold its consent to any settlement,
adjustment, or compromise of such insurance claims and no such settlement,
adjustment, or comprormise shall be final or binding upon Mortgagee without its
prior consent. Upon settlement of insurance claims, and if Mortgagor can
demonstrate to the reasonable satisfaction of Mortgagee that the projected ratio
of Net Operating Income, as defined below, to annual debt service due under the
Note and any other notes secured by the Property ("Debt Coverage Ratio") will be
at least one hundred five (105%) for the twelve (12) months immediately
following reconstruction of the Property, the insurance proceeds shall be
deposited into an escrow fund in accordance with section 1.05 below.
Notwithstanding any prohibition against prepayments or partial prepayments, if
the foregoing Debt Coverage Ratio is not satisfied, Mortgagor may elect to make
a partial prepayment (together with a proportionate Prepayment Premium
calculated in accordance with the provisions of the Note) sufficient to reduce
the outstanding principal amount of the Note to an amount such that the Debt
Coverage Ratio requirement is satisfied.

As used in this Mortgage, "Net Operating Income" shall mean:

         (i) all gross receipts received or anticipated (as may be applicable)
         from tenants in the Property and paying rent under bona fide leases in
         effect during the applicable twelve (12) month period, calculated on a
         cash basis which reflects only the income actually received during the
         previous twelve (12) month period as of the date of such calculation,
         and any income anticipated to be received during the following twelve
         (12) month period based on leases in effect as of the date of
         calculation, for such time as those leases are contracted to remain in
         effect without expiration by their terms or optional termination by the
         tenant (unless the tenant has waived its termination rights in writing
         or the term of the lease has been extended in writing), including
         without limitation all amounts to be received from tenants as payment
         of operating expenses but not including refundable deposits, lease
         termination payments, excess tenant improvement and leasing commission
         payments included as additional rent, principal or interest payments
         received by Mortgagor on loans to tenants and fees and reimbursements
         for work performed for tenants by Mortgagor, less:

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         (ii) all amounts, calculated on a cash basis, for the operation or
         maintenance of the Property for the applicable twelve (12) month
         period, including ground rents, the cost of property management (which
         shall be no less than four percent (4%) of gross collections),
         maintenance, cleaning, security, landscaping, parking maintenance and
         utilities, and other costs and expenses approved in writing by
         Mortgagee and amounts reasonably estimated by Mortgagee for the payment
         of real estate taxes and assessments and other taxes related to the
         operation of the Property, insurance premiums, necessary repairs and
         future replacements of equipment; payments under the Note shall not be
         included in Net Operating Income.

              (D) If in the reasonable judgment of Mortgagee the conditions of
paragraph 1.04(C) cannot be satisfied, then at any time from and after the
occurrence of the damage, upon written notice to Mortgagor, Mortgagee may
declare the entire balance of the Note and/or any Future Advances then
outstanding and accrued and unpaid interest thereon, and all other sums or
payments required thereunder or under this Mortgage, without any Prepayment
Premium, to be immediately due and payable, and all insurance proceeds shall be
applied by Mortgagee first to the reimbursement of any costs or expenses
incurred by Mortgagee in connection with the damage or the determination to be
made hereunder, and then to the payment of the indebtedness secured by this
Mortgage in such order as Mortgagee may determine in its sole discretion.

              (E) If an Event of Default exists at any time from the time of
damage through the completion of restoration and the final release of any
insurance proceeds to Mortgagor, the use of the insurance proceeds shall be
governed by the remedies set forth in Article Ill below. If an event has
occurred which with notice, the passage of time, or both, could become an Event
of Default, then the Insurance Proceeds shall be held by Mortgagee or in the
Escrow Fund, as applicable, pending cure of such event prior to the expiration
of any applicable cure or grace period.

         1.05. Escrow Fund for Condemnation and Insurance Proceeds.

              (A) In the circumstances indicated above in subsections 1.03(C)
and 1.04(C), all Condemnation Proceeds and Insurance Proceeds shall be deposited
in an interest bearing escrow fund ("Escrow Fund"). The escrow agent and the
form of the escrow agreement shall be reasonably satisfactory to Mortgagee and
Mortgagor. The costs and fees of such escrow agent shall be paid by Mortgagor.
If the amount of the Proceeds is not sufficient to restore the Property based on
an independent contractor's or engineer's opinion obtained by Mortgagee at
Mortgagor's expense, subject to revision as restorations are made, Mortgagor
shall be obligated to deposit in the Escrow Fund the difference between the
contractor's or engineer's estimate and the amount of the Proceeds or deliver to
the escrow agent an irrevocable, unconditional letter of credit issued in the
amount of such difference in a form and by a financial institution acceptable to
Mortgagee or other cash equivalent acceptable to Mortgagee. The Mortgagor's
funds, if necessary, and the Proceeds shall be deposited into the Escrow Fund
and shall not be released by the escrow agent unless used to restore the
Property to its original condition and unless a

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disbursement agent satisfactory to Mortgagee and Mortgagor approves such
disbursements from time to time. The escrow agreement shall provide that the
escrow agent shall only disburse funds to Mortgagor so long as the restoration
work is being diligently performed by Mortgagor and only after (1) Mortgagee has
approved the plans and specifications for the restoration of the Property; (2)
Mortgagor has executed a contract acceptable to Mortgagee with a general
contractor acceptable to Mortgagee for the restoration of the Property; (3) the
general contractor has submitted lien waivers and/or releases, executed by the
general contractor and all subcontractors and suppliers which may be partial to
the extent of partial payments and which, in the case of releases, may be
contingent upon payment if the escrow agent makes payment directly to such
contractor, subcontractor or supplier; (4) Mortgagor has furnished Mortgagee
with an endorsement to its title policy showing no additional exceptions; and
(5) Mortgagor has submitted such other documents and information as may be
requested by Mortgagee to determine that the work to be paid for has been
performed in accordance with the plans and specifications approved by Mortgagee.
If any requisition for payment of work performed is for an amount which would
result in the remaining balance of the Escrow Fund to be insufficient to
complete the remainder of the restoration, Mortgagor shall advance the requisite
amount in cash to the Escrow Fund immediately upon written request from the
disbursement agent or Mortgagee.

              (B) Any Condemnation Proceeds and any interest thereon remaining
in the Escrow Fund after payment of the costs to complete the restoration of the
Property pursuant to the approved plans and specifications and the costs of the
escrow agent shall be paid first, to Mortgagor to the extent of any funds of
Mortgagor's contributed to the restoration pursuant to paragraph 1.05, provided
there is no Event of Default or an event which with notice, the passage of time,
or both, could become an Event of Default, and thereafter at Mortgagee's option,
any remaining Condemnation Proceeds may be applied to the partial payment or
prepayment of the Note without payment of any Prepayment Premium or may be
returned to the Mortgagor. If an Event of Default exists, the use of the
Condemnation Proceeds shall be governed by Article III below. If, however, an
event exists which with notice, the passage of time, or both, could become an
Event of Default, the remaining balance in the Escrow Fund shall be held by the
escrow agent pending cure of the event prior to the expiration of any applicable
cure or grace period.

              (C) Any Insurance Proceeds and any interest thereon remaining in
the Escrow Fund after payment of the costs to complete the restoration of the
Property pursuant to the approved plans and specifications and the costs of the
escrow agent, provided there is no Event of Default or an event which with
notice, the passage of time, or both, could become an Event of Default, shall be
paid first, to Mortgagor to the extent of any funds of Mortgagor's contributed
to the restoration pursuant to paragraph 1.05, and thereafter at Mortgagee's
option, any remaining Insurance Proceeds may be applied to the partial payment
or prepayment of the Note without payment of any Prepayment Premium or may be
returned to the Mortgagor. If an Event of Default exists at any time from the
time of completion of restoration and the final application of any Insurance
Proceeds, the use of the Insurance Proceeds shall be governed by Article III
below. If, however, an event exists which with notice, the passage of time, or
both,

                                      13


<PAGE>


could become an Event of Default, the remaining balance in the Escrow Fund
shall be held by the escrow agent pending cure of the event prior to the
expiration of any applicable cure or grace period.

         1.06. Taxes, Liens and other Items.

              (A) Mortgagor shall pay any and all taxes, bonds, assessments,
fees, liens, charges, fines, impositions and any accrued interest or penalty
thereon, and any and all other items which are attributable to or affect the
Property by making payment prior to delinquency directly to the payee thereof
and promptly furnish copies of paid receipts for these to Mortgagee. Mortgagor
shall promptly discharge or bond any lien or encumbrance on the Property whether
said lien or encumbrance has or may attain priority over this Mortgage or not.
This Mortgage shall be the sole encumbrance on the Property and, if with the
consent of Mortgagee it is not the sole encumbrance, then it shall be prior to
any and all other liens or encumbrances on the Property. Provided that the
priority of this Mortgage is not in any way affected, Mortgagor may in good
faith protest the payment of any tax or lien which it believes is unwarranted or
excessive and may defer payment of such tax pending conclusion of such contest
if legally permitted to do so and provided Mortgagee's security is not
jeopardized in Mortgagee's sole reasonable opinion.

              (B) As further security for the payment of the Note and the
payment of real estate taxes, regular or special assessments and insurance
premiums, Mortgagor shall be required to deposit one-twelfth (1/12) of the
annual amounts of such items as estimated by Mortgagee, with each monthly
payment on the Note, so that Mortgagee will hold a sufficient amount to pay all
such charges not less than thirty (30) days prior to the date on which such
items become due and payable. Mortgagee shall be famished evidence to allow it
to estimate such amounts, including paid receipts or annual insurance premium
statements, assessment notices and tax receipts. All funds so deposited shall,
until applied to the payment of the aforesaid items, as hereinafter provided, be
held by Mortgagee without interest (except to the extent required under
applicable law) and may be commingled with other funds of Mortgagee. All funds
so deposited shall be applied to the payment of the aforesaid items only upon
the satisfaction of the following conditions: (1) no Event of Default or event,
which with notice or the passage of time or both could become an Event of
Default, shall have occurred; (2) Mortgagee shall have sufficient funds to pay
the full amounts of such items (which funds may include amounts paid solely for
such purpose by Mortgagor in addition to the escrowed funds); and (3) Mortgagor
shall have furnished Mortgagee with prior written notification that such items
are due and with the bills and invoices therefor in sufficient time to pay the
same before any penalty or interest attaches and before policies of insurance
lapse, as the case may be, and shall have deposited any additional funds as
Mortgagee may determine as necessary to pay such items.

              (C) Mortgagee expressly disclaims any obligation to pay the
aforesaid items unless and until Mortgagor complies with all of the provisions
set forth in subsections 1.06(A) and (B). Mortgagor hereby pledges any and all
monies now or hereafter deposited pursuant to subsection 1.06(B) as additional
security for the Note and Related Agreements. If any Event of

                                      14


<PAGE>


Default shall have occurred, or if the Note shall be accelerated as herein
provided, all funds so deposited may, at Mortgagee's option, be applied as
determined solely by Mortgagee or to cure said Event of Default or as provided
in this section 1.06. In no event shall Mortgagor claim any credit against the
principal and interest due hereunder for any payment or deposit for any of the
aforesaid items.

         1.07. Assignment of Leases, Contracts, Rents and Profits.

              (A) Mortgagor hereby absolutely, presently and unconditionally
grants, assigns, transfers, conveys and sets over to Mortgagee all of
Mortgagor's right, title and interest in and to the following whether arising
under the Leases, by statute, at law, in equity, or in any other way:

                   (1) All of the Leases of the Property which are in effect on
          the date hereof, and entered into or in effect from time to time after
          the date hereof, including, without limitation, all amendments,
          extensions, replacements, modifications and renewals thereof and all
          subleases, concession agreements, any ground leases or ground
          subleases and all other agreements affecting the same (the "Leases")
          and all guaranties thereunder;

                    (2) All of the rents, income, profits, revenue, royalties,
          judgments, condemnation awards, Insurance Proceeds, unearned insurance
          premiums and any other fees or sums payable to Mortgagor or any other
          person as landlord and other benefits and rights of the Property
          arising from the use, occupancy, operation or management of all or any
          portion thereof or from all the Leases, and any proceeds, deposits or
          security deposits relating thereto, including, without limitation, any
          award to Mortgagor made hereafter in any court involving any of the
          tenants under the Leases in any bankruptcy, insolvency, or
          reorganization proceeding in any state or federal court, and
          Mortgagor's right to appear in any action and/or to collect any such
          award or payment, and all payments by any tenant in lieu of rent
          (collectively, "Rents and Profits"); and

                    (3) All contracts, agreements, management, operating and
          maintenance agreements, warranties, licenses, permits, guaranties and
          sales contracts relating to the Property and the Collateral entered
          into by, or inuring to the benefit of, Mortgagor (the "Contracts").

              (B) Notwithstanding the provisions of subsection 1.07(A), prior to
the occurrence of any Event of Default hereunder, Mortgagee shall not exercise
any of the rights or powers conferred upon Mortgagee by this section 1.07, and,
subject to subsection 1.07(F), Mortgagor shall have a license to manage the
Property; to collect, receive and use all Rents and Profits in accordance with
the terms of the Leases; to let the Property and to take all actions which a
reasonable and prudent landlord would take in enforcing the provisions of the
Leases and Contracts; provided, however, that all amounts so collected shall be
applied toward

                                      15


<PAGE>


operating expenses, real estate taxes and insurance relating to the Property,
capital repair items necessary to the operation of the Property, and the payment
of sums due and owing under the Note, and this Mortgage prior to any other
expenditure or distribution by Mortgagor. From and after the occurrence of an
Event of Default (whether or not Mortgagee shall have exercised Mortgagee's
option to declare the Note immediately due and payable), such license shall be
automatically revoked without any action required by Mortgagee. Any amounts
received by Mortgagor or its agents in the performance of any acts prohibited by
the terms of this Mortgage, including but not limited to any amounts received in
connection with any cancellation, modification or amendment of any of the Leases
prohibited by the terms of this Mortgage and any amounts received by Mortgagor
as rents, income, issues or profits from the Property from and after an Event of
Default under this Mortgage, the Note, or any of the other Related Agreements,
shall be held by Mortgagor as trustee for Mortgagee and all such amounts shall
be accounted for Mortgagee and shall not be commingled with other funds of the
Mortgagor. Any person acquiring or receiving all or any portion of such trust
funds shall acquire or receive the same in trust for Mortgagee as if such person
had actual or constructive notice that such funds were impressed with a trust in
accordance herewith.

              (C) Upon the occurrence of an Event of Default, the Mortgagee
shall have the right but not the obligation to perform as landlord under the
Leases and as a party under the Contracts. The assignment of Rents and Profits
set forth herein constitutes an irrevocable direction and authorization of all
tenants under the Leases to pay all Rents and Profits to Mortgagee upon demand
and without further consent or other action by Mortgagor. Mortgagor irrevocably
appoints Mortgagee its true and lawful attorney, at the option of Mortgagee at
any time, to demand, receive and enforce payment, to give receipts, releases and
satisfactions, and to sue, either in the name of Mortgagor or in the name of
Mortgagee, for all such Rents and Profits and apply the same to the indebtedness
secured by this Mortgage.

              (D) Neither the foregoing assignment of Rents and Profits, Leases
and Contracts to Mortgagee nor the exercise by Mortgagee of any of its rights or
remedies under Article III shall be deemed to make Mortgagee a
"mortgagee-in-possession" or otherwise liable in any manner with respect to the
Property, unless Mortgagee, in person or by agent, assumes actual possession
thereof. Nor shall appointment of a receiver for the Property by any court at
the request of Mortgagee or by agreement with Mortgagor, or the entering into
possession of the Property by such receiver, be deemed to make Mortgagee a
"mortgagee-in-possession" or otherwise liable in any manner with respect to the
Property.

              (E) In the event Mortgagee collects and receives any Rents and
Profits under this section 1.07 pursuant to any Monetary or Performance Default
as defined in section 2.01 hereof, such collection or receipt shall in no way
constitute a curing of the Monetary or Performance Default.

              (F) Mortgagor shall not, without the prior written consent of
Mortgagee which consent shall not be unreasonably withheld or delayed, (1) enter
into, or consent to or permit the assignment or subletting of, any Leases except
that Mortgagee's prior written approval shall not

                                      16


<PAGE>


be required with respect to Leases demising no more than 20,000 rentable square
feet of the Property which provide for a term of five (5) years or less and a
rental rate, including rental concessions, at least equal to that charged for
comparable properties within the Property's submarket area, have been negotiated
at arm's length, and do not contain material modifications to the form of lease
previously approved by Mortgagee; (2) modify, extend, cancel, consent to any
surrender or in any way alter the terms of any Leases or take any action under
or with respect to any such Leases which would materially decrease either the
obligations of the tenant thereunder or the rights or remedies of the landlord
or otherwise fail to perform the landlord's obligations under the Leases (except
that Mortgagee's prior approval shall not be required with respect to amendments
to leases of less than 20,000 rentable square feet if the amendment does not
materially decrease the obligations of the tenant and the amendment is such that
the lease would not have required Mortgagee's approval if it had originally
contained such terms and conditions); (3) alter, modify, change or terminate the
terms of any guaranties of the Leases; (4) create or permit any lien or
encumbrance which, upon foreclosure, would be superior to any such Leases or in
any other manner impair Mortgagee's rights and interest with respect to the
Rents and Profits, (5) pledge, transfer, mortgage or otherwise encumber or
assign the Leases, the Contracts or the Rents and Profits; or (6) collect rents
more than thirty (30) days prior to their due date. Any lease submitted for
Mortgagee's consent shall, at Mortgagee's option, be accompanied by a
Subordination, Nondisturbance and Attornment Agreement in Mortgagee's then
current form.

               (G) Mortgagor shall promptly give notice to Mortgagee of any
default under any of the Leases meeting the criteria of a lease for which
Mortgagee's consent would have been required pursuant to paragraph 1.07(F)
regardless of whether such Leases were executed before or after the date of this
Mortgage, together with a complete copy of any notices delivered to or by the
tenant as a result of such default. Mortgagee shall have the right, but not the
obligation, to cure any default of Mortgagor under any of the Leases and all
amounts disbursed in connection with said cure shall be deemed to be
indebtedness secured hereby.

               (H) Mortgagee shall have the right to approve any lease forms
used by Mortgagor for lease of space in the Property.

               (I) Mortgagor hereby represents, warrants and agrees that:

                    (1) Mortgagor has the right, power and capacity to make this
     assignment and that no person, firm or corporation or other entity other
     than Mortgagor has or will have any right, title or interest in or to the
     Leases or the Rents and Profits.

                    (2) Mortgagor shall, at its sole cost and expense, perform
     and discharge all of the obligations and undertakings of the landlord under
     the Leases. Mortgagor shall enforce the performance of each obligation of
     the tenants under the Leases and will appear in and prosecute or defend any
     action connected with the Leases or the obligations of the tenants
     thereunder.

                                      17


<PAGE>


              (J) Mortgagee shall not be obligated to perform or discharge, nor
does it hereby undertake to perform or discharge, any obligation, duty or
liability under the Leases or under or by reason of this assignment. Mortgagor
shall and does hereby agree to indemnify Mortgagee for and to defend and hold
Mortgagee harmless from any and all liability, loss or damage which Mortgagee
may or might incur under the Leases or under or by reason of this assignment,
and from any and all claims whatsoever which may be asserted against Mortgagee
by reason of any alleged obligations or undertakings on Mortgagee's part to
perform or discharge any of the terms, covenants or agreements contained in the
Leases. Should Mortgagee incur any liability, loss or damage under the Leases or
under or by reason of this assignment, or in the defense of any of such claims
or demands, the amount thereof, including costs, expenses and attorneys' fees,
shall be secured by this Mortgage; and Mortgagor shall reimburse Mortgagee
therefor immediately upon demand, and upon failure of Mortgagor to do so,
Mortgagee may declare all sums so secured to be immediately due and payable.

              (K) Mortgagee may take or release other security, may release any
party primarily or secondarily liable for any indebtedness secured hereby, may
grant extensions, renewals or indulgences with respect to such indebtedness, and
may apply any other security therefor held by it to the satisfaction of such
indebtedness, without prejudice to any of its rights hereunder.

              (L) Nothing herein contained and no act done or omitted by
Mortgagee pursuant to the powers and rights granted it herein shall be deemed to
be a waiver by Mortgagee of its other rights and remedies under the Note and
this Mortgage, and this assignment is made and accepted without prejudice to any
of the other rights and remedies possessed by Mortgagee under the terms thereof.
The right of Mortgagee to collect said indebtedness and to enforce any other
security therefor held by it may be exercised by Mortgagee either prior to,
simultaneously with, or subsequent to any action taken by it hereunder. It is
the intent of both Mortgagor and Mortgagee that this assignment be supplementary
to, and not in substitution or derogation of, any other provision contained in
this Mortgage giving Mortgagee any interest in or rights with respect to the
Leases or Rents and Profits.

              (M) Neither this assignment nor pursuit of any remedy hereunder by
Mortgagee shall cause or constitute a merger of the interests of the tenant and
the Mortgagor under any of the Leases such that any of the Leases hereby
assigned are no longer valid and binding legal obligations of the parties
executing the same.

              (N) Mortgagor agrees, from time to time, to execute and deliver,
upon demand, all assignments and any and all other writings as Mortgagee may
reasonably deem necessary or desirable to carry out the purpose and intent
hereof, or to enable Mortgagee to enforce any right or rights hereunder.

         1.08. Acceleration Upon Sale or Encumbrance. If Mortgagor shall (A)
sell or convey the Property or any part thereof, or any interest in the
Property; (B) be divested of its title to the Property or any interest therein;
(C) further encumber the Property; (D) enter into any lease

                                       18
<PAGE>




giving the tenant any option to purchase the Property or any part thereof;
without the prior written consent of Mortgagee, then Mortgagee shall have the
right, at its option, to declare the indebtedness secured by this Mortgage,
irrespective of the maturity date specified in the Note, immediately due and
payable. Notwithstanding the foregoing, in the event that the Mortgagor is an
entity other than Ag-Chem Equipment Co., Inc., then if Mortgagor or any general
partner, member or shareholder of Mortgagor or any general partner of such
general partner shall (A) sell or convey the Property or any part thereof, or
any interest in the Property or in Mortgagor; (B) be divested of its title to
the Property or any interest therein; (C) further encumber the Property or the
ownership interests in the Mortgagor; (D) enter into any lease giving the tenant
any option to purchase the Property or any part thereof, or (E) encumber, grant
a security interest in, transfer, permit the transfer of, or change or permit
the change in: (1) the ownership of interests in the Mortgagor or any general
partner or any shareholder or any member of Mortgagor or any general partner of
such general partner, or (2) the amount of the general partnership, shares, or
membership interests in Mortgagor or the general partners of the Mortgagor or
any general partner of such general partner, without the prior written consent
of Mortgagee, then Mortgagee shall have the right, at its option, to declare the
indebtedness secured by this Mortgage, irrespective of the maturity date
specified in the Note, immediately due and payable. Except as expressly
consented to in writing by Mortgagee, Mortgagor shall not permit any additional
encumbrances on the Property.

         1.09. Preservation and Maintenance of Property. Mortgagor shall hire
competent and responsive property managers who shall be reasonably acceptable to
Mortgagee. Mortgagor or its property manager, if applicable shall keep the
Property and every part thereof in good condition and repair, in accordance with
sound property management practices and shall promptly and faithfully comply
with and obey all laws, ordinances, rules, regulations, requirements and, orders
of every duly constituted governmental authority or agent having jurisdiction
with respect to the Property. Mortgagor shall not permit or commit any waste,
impairment, or deterioration of the Property, nor commit, suffer or permit any
act upon or use of the Property in violation of law or applicable order of any
governmental authority, whether now existing or hereafter enacted, or in
violation of any covenants, conditions or restrictions affecting the Property or
bring or keep any article in the Property or cause or permit any condition to
exist thereon which would be prohibited by or invalidate the insurance coverage
required to be maintained hereunder. Mortgagor shall not make any material
structural changes or alterations to the Property nor remove or demolish the
Improvements or any portion thereof without the prior written consent of
Mortgagee. Mortgagor shall promptly restore any portion of the Property which
may be damaged or destroyed. Mortgagor shall promptly bond or discharge any
mechanics' liens against the Property.

         Unless required by applicable law or unless Mortgagee has otherwise
first agreed in writing, Mortgagor shall not make or allow any changes which
will adversely affect the value of the Property to be made in the nature of the
occupancy or use of the Property or any part thereof for which the Property or
such part was intended at the time this Mortgage was delivered. Mortgagor shall
not initiate or acquiesce in any change which will adversely affect the value of
the Property in any zoning or other land use classification now or hereafter in
effect and

                                      19


<PAGE>


affecting the Property or any part thereof without in each case obtaining
Mortgagee's prior written consent thereto.

         1.10. Offset Certificates. Mortgagor, within ten (10) days upon request
in person or within fifteen (15) days upon request by mail, shall furnish a
written statement duly acknowledged and notarized, of all amounts due on any
indebtedness secured hereby or secured by any of the Related Agreements, whether
for principal or interest on the Note or otherwise, and stating whether any
offsets or defenses exist against the indebtedness secured hereby and covering
such other matters with respect to any such indebtedness as Mortgagee may
reasonably require.

         1.11. Mortgagee's Costs and Expenses. Mortgagor shall pay all costs,
fees and expenses of Mortgagee, its agents and counsel, in connection with the
performance of its duties hereunder.

         1.12. Protection of Security; Costs and Expenses. Mortgagor and its
property manager, if applicable, shall appear in and defend any action or
proceeding purporting to affect the security of this Mortgage or any additional
or other security for the obligations secured hereby, or the rights or powers of
the Mortgagee, and shall pay all costs and expenses actually incurred,
including, without limitation, cost of evidence of title and actual attorneys'
fees, in any such action or proceeding in which Mortgagee may appear, and in
any suit brought by Mortgagee to foreclose this Mortgage or to enforce or
establish any other rights or remedies of Mortgagee hereunder or under any other
security for the obligations secured hereby. If Mortgagor fails to perform any
of the covenants or agreements contained in this Mortgage, or if any action or
proceeding is commenced which affects Mortgagee's interest in the Property or
any part thereof, including, eminent domain, code enforcement, or proceedings of
any nature whatsoever under any federal or state law, whether now existing or
hereafter enacted or amended, relating to bankruptcy, insolvency, arrangement,
reorganization or other form of debtor relief, or to a decedent, then Mortgagee
may, but without obligation to do so and without notice to or demand upon
Mortgagor, perform such covenant or agreement and compromise any encumbrance,
charge or lien which in the judgment of Mortgagee appears to be prior or
superior hereto. Mortgagor shall further pay all expenses of Mortgagee actually
incurred (including reasonable and actual fees and disbursements of counsel)
incident to the protection or enforcement of the rights of Mortgagee hereunder,
and enforcement or collection of payment of the Note or any Future Advance
whether by judicial or nonjudicial proceedings, or in connection with any
bankruptcy, insolvency, arrangement, reorganization or other debtor relief
proceeding of Mortgagor, or otherwise. Any amounts disbursed by Mortgagee
pursuant to this section or section 1.11 shall be additional indebtedness of
Mortgagor secured by this Mortgage and each of the Related Agreements as of the
date of disbursement and shall bear interest at the Default Rate set forth in
the Note, from demand until paid. All such amounts shall be payable by Mortgagor
immediately upon demand. Nothing contained in this section shall be construed to
require Mortgagee to incur any expense, make any appearance, or take any other
action.

                                      20


<PAGE>




         1.13. Mortgagor's Covenants Respecting Collateral.

              (A) Mortgagor shall execute and deliver financing and continuation
statements covering the Collateral from time to time and in such form as
Mortgagee may require to perfect and continue the perfection of Mortgagee's
security interest with respect to such property, and Mortgagor shall pay all
reasonable costs and expenses of any record searches for financing statements
Mortgagee may require.

              (B) Without the prior written consent of Mortgagee, Mortgagor
shall not create or suffer to be created any other security interest in the
Collateral, including replacements and additions thereto.

              (C) Without the prior written consent of Mortgagee or except in
the ordinary course of business, Mortgagor shall not sell, transfer or encumber
any of the Collateral, or remove any of the Collateral from the Property unless
Mortgagor shall promptly substitute and replace the property removed with
similar property of at least equivalent value on which Mortgagee shall have a
continuing security interest ranking at least equal in priority to Mortgagee's
security interest in the property removed.

              (D) Mortgagor shall (1) upon reasonable notice (unless an
emergency or Event of Default exists) permit Mortgagee and its representatives
to enter upon the Property to inspect the Collateral and Mortgagor's books and
records relating to the Collateral and make extracts therefrom and to arrange
for verification of the amount of Collateral, under procedures acceptable to
Mortgagee, directly with Mortgagor's debtors or otherwise at Mortgagor's
expense; (2) promptly notify Mortgagee of any attachment or other legal process
levied against any of the Collateral and any information received by Mortgagor
relative to the Collateral, Mortgagor's debtors or other persons obligated in
connection therewith, which may in any way affect the value of the Collateral or
the rights and remedies of Mortgagee in respect thereto; (3) reimburse Mortgagee
upon demand for any and all costs actually incurred, including, without
limitation, reasonable and actual attorneys' and accountants' fees, and other
expenses incurred in collecting any sums payable by Mortgagor under any
obligation secured hereby, or in the checking, handling and collection of the
Collateral and the preparation and enforcement of any agreement relating
thereto; (4) notify Mortgagee of each location at which the Collateral is or
will be kept, other than for temporary processing, storage or similar purposes,
and of any removal thereof to a new location, including, without limitation,
each office of Mortgagor at which records relating to the Collateral are kept;
(5) provide, maintain and deliver to Mortgagee originals or certified copies of
the policies of insurance and certificates of insurance insuring the Collateral
against loss or damage by such risks and in such amounts, from and by such
companies as Mortgagee may require and with loss payable to Mortgagee, and in
the event Mortgagee takes possession of the Collateral, the insurance policy or
policies and any unearned or returned premium thereon shall at the option of
Mortgagee become the sole property of Mortgagee; and (6) do all acts necessary
to maintain, preserve and protect all Collateral, keep all Collateral in good
condition and repair and prevent any waste or unusual or unreasonable
depreciation thereof.

                                      21
<PAGE>


              (E) Until Mortgagee exercises its right to collect proceeds of the
Collateral pursuant hereto, Mortgagor will collect with diligence any and all
proceeds of the Collateral. If an Event of Default exists, any proceeds received
by Mortgagor shall be held in trust for Mortgagee, and Mortgagor shall keep all
such collections separate and apart from all other funds and property so as to
be capable of identification as the property of Mortgagee and shall deliver to
Mortgagee such collections at such time as Mortgagee may request in the
identical form received, properly endorsed or assigned when required to enable
Mortgagee to complete collection thereof.

              (F) Mortgagee shall have all of the rights and remedies granted to
a secured party under the Uniform Commercial Code of the state in which the
Collateral is located, as well as all other rights and remedies available at law
or in equity. During the continuance of any Event of Default hereunder or under
the Note, Mortgagee shall have the right to take possession of all or any part
of the Collateral, to receive directly or through its agent(s) collections of
proceeds of the Collateral (including notification of the persons obligated to
make payments to Mortgagor in respect of the Collateral), to release persons
liable on the Collateral and compromise disputes in connection therewith, to
exercise all rights, powers and remedies which Mortgagor would have, but for the
security agreement contained herein, to all of the Collateral and proceeds
thereof, and to do all other acts and things and execute all documents in the
name of Mortgagor or otherwise, deemed by Mortgagee as necessary, proper and
convenient in connection with the preservation, perfection or enforcement of its
rights hereunder; and

              (G) After any Event of Default hereunder or under the Note,
Mortgagor shall, at the request of Mortgagee, assemble and deliver the
Collateral and books and records pertaining to the Property at a place
designated by Mortgagee, and Mortgagee may, with reasonable notice to Mortgagor
(unless an emergency or Event of Default exists), enter onto the Property and
take possession of the Collateral. It is agreed that public or private sales,
for cash or on credit to a wholesaler or retailer or investor, or user of
collateral of the types subject to the security agreement, or public auction,
are all commercially reasonable since differences in the sales prices generally
realized in the different kinds of sales are ordinarily offset by the
differences in the costs and credit risks of such sales. The proceeds of any
sale of the Collateral shall be applied first to the expenses of Mortgagee
actually incurred in retaking, holding, preparing for sale, or selling the
Collateral or similar matters, including reasonable and actual attorneys' fees,
and then, as Mortgagee shall solely determine.

         1.14. Covenants Regarding Financial Statements.

              (A) Mortgagor shall keep true books of record and account in which
full, true and correct entries in accordance with sound accounting practice and
principles applied on a consistent basis from year to year shall be made of all
dealings or transactions with respect to the Property.

                                      22
<PAGE>


  (B)   (1) Mortgagor shall deliver to Mortgagee:

        (A) Within sixty (60) days after the last day of each fiscal year of
         the Mortgagor during the term of the Note, unaudited annual financial
         reports prepared on a cash basis, including balance sheets, income
         statements and cash flow statements covering the operation of the
         Property, the financial condition of Mortgagor for the previous fiscal
         year, all certified to Mortgagee to be complete, correct and accurate
         by the individual, managing general partner, manager or chief financial
         officer of the party whom the report concerns;

         In the event that the Mortgagor is an entity other than Ag-Chem
         Equipment Co., Inc., then the financial reports required in this
         paragraph shall be required for Mortgagor's general partner(s),
         shareholder(s), member(s) and such principals of the Mortgagor as
         Mortgagee may from time to time designate, in addition to Mortgagor.

        (B) If available, within thirty (30) days after receipt by Mortgagor,
         original annual audit reports of an independent certified public
         accountant prepared in accordance with generally accepted accounting
         principles containing an unqualified opinion, including balance sheets,
         income statements and cash flow statements covering the operation of
         the Property and the financial condition of the Mortgagor for the
         previous fiscal year.

         In the event that Mortgagor is an entity other than Ag-Chem Equipment
         Co., Inc., then the annual audit reports required in this paragraph
         shall be required for Mortgagor's general partner(s), shareholder(s),
         member(s), and such principals of the Mortgagor as Mortgagee may from
         time to time designate, in addition to Mortgagor.

         (2) At the request of Mortgagee from time to time (but no more often
than once in each fiscal quarter of the Mortgagor during the term of the Note),
Mortgagor shall also deliver to Mortgagee unaudited financial reports prepared
on a cash basis, including balance sheets, income statements and cash flow
statements covering the operation of the Property and the financial condition of
the Mortgagor for the previous fiscal quarter, a portfolio analysis report
covering the operation of all properties of which Mortgagor is the owner or a
general partner of the owner, setting out a cash flow statement (including debt
service payments) for each such property, and a current rent roll of the
Property, all certified to Mortgagee to be complete, correct and accurate by the
individual, managing general partner, member or chief financial officer of the
party whom the report concerns.

                                  23
<PAGE>


                  In the event that Mortgagor is an entity other than Ag-Chem
    Equipment Co., Inc., then the financial reports required in this paragraph
    shall cover the financial condition of Mortgagor's general partner(s),
    shareholder(s), member(s), and such principals of the Mortgagor as Mortgagee
    may from time to time request, in addition to the Mortgagor, and the
    portfolio analysis report shall cover the operation of all properties of
    which Mortgagor or any of Mortgagor's general partners, shareholder(s),
    member(s), or principals designated by Mortgagee is the owner or a general
    partner of the owner.

                   (3) All reports shall include, without limitation, balance
sheets and statements of income and of partner's equity, if applicable, setting
forth in each case in comparative form the figures for the previous fiscal
quarter or year, as the case may be. The interim quarterly reports shall also
include a breakdown of all categories of revenues and expenses, and any
supporting schedules and data requested by Mortgagee. Each set of annual or
quarterly financial reports or quarterly rent rolls delivered to Mortgagee
pursuant to this section 1.14 shall also be accompanied by a certificate of the
chief financial officer or the managing general partner or the member of
Mortgagor, stating whether any condition or event exists or has existed during
the period covered by the annual or quarterly reports which then constituted or
now constitutes an Event of Default under the Note or this Mortgage, and if any
such condition or event then existed or now exists, specifying its nature and
period of existence and what Mortgagor did or proposes to do with respect to
such condition or event.

              (C) In the event such statements are not in a form reasonably
acceptable to Mortgagee or Mortgagor fails to furnish such statements and
reports, then Mortgagee shall have the immediate and absolute right to audit the
respective books and records of the Property and Mortgagor at the expense of
Mortgagor.

         1.15. Environmental Covenants. Mortgagor covenants: (A) that no
Hazardous Materials (as defined below) (other than Hazardous Materials in
quantities and of types reasonably and customarily associated with general
office use that are stored, used and disposed of in compliance with Hazardous
Material law and do not require compliance with any reporting requirements under
any Hazardous Material Law) shall be installed, used, generated, manufactured,
treated, handled, refined, produced, processed, stored or disposed of, in, on or
under the Property; (B) that no activity shall be undertaken on the Property
which would cause (1) the Property to become a hazardous waste treatment,
storage or disposal facility under any Hazardous Material Law, (2) a release or
threatened release of Hazardous Material from the Property in violation of any
Hazardous Material Law, or (3) the discharge of Hazardous Material into any
watercourse, body of surface or subsurface water or wetland, or the discharge
into the atmosphere of any Hazardous Material which would require a permit under
any Hazardous Material Law and for which no such permit has been issued; (C)
that no activity shall be undertaken or permitted to be undertaken, by the
Mortgagor on the Property which would result in a violation under any Hazardous
Material Law, and (D) to obtain and deliver to Mortgagee, within a reasonable
time following completion of actions required by an appropriate governmental
agency, certifications of engineers or other professionals reasonably
acceptable to Mortgagee, in form and substance satisfactory to Mortgagee,
certifying that all necessary and

                                      24
<PAGE>


required actions to clean up, remove, contain, prevent and eliminate all
releases or threats of release of Hazardous Materials on or about the Property
to the levels required by the appropriate governmental agencies have been taken
and, to the knowledge of such professional, the Property is then in compliance
with applicable Hazardous Material Laws as then in effect and applicable to such
actions. For purposes of this Mortgage, "Hazardous Materials" means and includes
asbestos or any substance containing asbestos, polychlorinated biphenyls, any
explosives, radioactive materials, chemicals known or suspected to cause cancer
or reproductive toxicity, pollutants, effluents, contaminants, emissions,
infectious wastes, any petroleum or petroleum-derived waste or product or
related materials and any items defined as hazardous, special or toxic
materials, substances or waste under any Hazardous Material Law, or any material
which shall be removed from the Property pursuant to any administrative order or
enforcement proceeding or in order to place the Property in a condition that is
suitable for ordinary use. "Hazardous Material Laws" collectively means and
includes any present and future local, state, federal or international law or
treaty relating to public health, safety or the environment including without
limitation, the Resource Conservation and Recovery Act, as amended ("RCRA"), 42
U.S.C. ss. 6901 et seq., the Comprehensive Environmental Response, Compensation,
and Liability Act ("CERCLA"), 42 U.S.C. ss. 9601 et seq., as amended by the
Superfund Amendments and Reauthorization Act of 1986 ("SARA"), the Hazardous
Materials Transportation Act, 49 U.S.C. ss. 1801 et seq., the Clean Water Act,
33 U.S.C. ss. 1251 et seq., the Clean Air Act, as amended 42 U.S.C. ss. 7401 et
seq., the Toxic Substances Control Act, 15 U.S.C. ss. 2601 et seq., the Safe
Drinking Water Act, 42 U.S.C. ss. 300f et seq., the Uranium Mill Tailings
Radiation Control Act, 42 U.S.C. ss. 7901 et seq., the Occupational Safety and
Health Act, 29 U.S.C. ss. 655 et seq., the Federal Insecticide, Fungicide and
Rodenticide Act, 7 U.S.C. ss. 136 et seq., the National Environmental Policy
Act, 42 U.S.C. ss. 4321 et seq., the Noise Control Act, 42 U.S.C. ss. 4901 et
seq., and the Emergency Planning and Community Right-to-Know Act, 42 U.S.C. ss.
11001 et seq., and the amendments, regulations, orders, decrees, permits,
licenses or deed restrictions now or hereafter promulgated thereunder.

         1.16. Exclusions from Collateral and Contracts. Mortgagor occupies a
portion of the Property, as a tenant, for the purpose of conducting its normal
and customary business affairs. Collateral and Contracts, as defined herein,
shall not include personal property of Mortgagor located in or associated with
the Property as a result of Mortgagor's business occupancy of a portion of the
Property. Collateral and Contracts shall include only the personal property of
Mortgagor that is used in connection with or relates to Mortgagor's ownership,
maintenance, and operation of the Property as a whole.

                                   ARTICLE II
                                EVENTS OF DEFAULT

         Each of the following shall constitute an event of default ("Event of
Default") hereunder:

     2.01.   Monetary and Performance Defaults.

                                       25
<PAGE>


              (A) Failure to make any payment due under the Note or any note
evidencing a Future Advance, other than the final payment and Prepayment
Premium, or to make any payment due under this Mortgage to Mortgagee or any
other party, including without limitation, payment of escrow deposits, real
estate taxes, insurance premiums and ground rents, if any, on or before the
fifth day of the month in which such payment is due; or

              (B) Failure to make the final payment or the Prepayment Premium
due under the Note or any note evidencing a Future Advance when such payment is
due whether at maturity, by reason of acceleration, as part of a prepayment or
otherwise (the defaults in (A) and (B) hereinafter "Monetary Default"); or

              (C) Breach or default in the performance of any of the covenants
or agreements of Mortgagor contained herein or in any Related Agreement
("Performance Default"), if such Performance Default shall continue for thirty
(30) days or more after written notice to Mortgagor from Mortgagee specifying
the nature of the Performance Default; provided, however, that if such
Performance Default is of a nature that it cannot be cured within the thirty
(30) day period, then Mortgagor shall not be in default if it commences good
faith efforts to cure the Performance Default within the thirty (30) day period,
demonstrates continuous diligent efforts to cure the Performance Default in a
manner satisfactory to Mortgagee and, within a reasonable period, not to exceed
one hundred eighty (180) days after the date of the original written notice of
the Performance Default, completes the cure of such Performance Default.

         2.02. Bankruptcy, Insolvency, Dissolution.

              (A) Any court of competent jurisdiction shall sign an order (1)
adjudicating Mortgagor or any guarantor (which term when used in this Mortgage
shall mean guarantor of payment of the indebtedness) bankrupt or insolvent, (2)
appointing a receiver, trustee or liquidator of the Property or of a substantial
part of the property of Mortgagor or any guarantor, or (3) approving a petition
for, or effecting an arrangement in bankruptcy, or any other judicial
modification or alteration of the rights of Mortgagee or of other creditors of
Mortgagor or any guarantor; or

              (B) Mortgagor shall (1) apply for or consent to the appointment of
a receiver, trustee or liquidator for it or for any of its property, (2) as
debtor, file a voluntary petition in bankruptcy, or petition or answer seeking
reorganization or an arrangement with creditors or to take advantage of any
bankruptcy, reorganization, insolvency, readjustment of debt, dissolution or
liquidation law or statute, or an answer admitting the material allegations of a
petition filed against it and any proceeding under such law, (3) admit in
writing an inability to pay its debts as they mature, or (4) make a general
assignment for the benefit of creditors; or

               (C) An involuntary petition in bankruptcy is filed against
Mortgagor  and the same is not vacated or stayed within thirty (30) days of the
filing date.

                                      26
<PAGE>


         In the event that the Mortgagor is an entity other than Ag-Chem
Equipment Co, Inc., then the provisions of Paragraph 2.02 shall apply to any
person, partnership or corporation holding an ownership interest in Mortgagor or
in any partnership comprising Mortgagor.

         2.03. Misrepresentation. Mortgagor makes or furnishes a representation,
warranty, if statement, certificate, schedule and/or report to Mortgagee in or
pursuant to this Mortgage or any of the Related Agreements which is false or
misleading in any material respect as of the date made or furnished.

         2.04. Default under Subordinate Loans. An occurrence of a default under
any loan subordinate to this Mortgage which is not an independent default under
this Mortgage which results in the commencement of foreclosure proceedings or
the taking of any other remedial action under such subordinate loan.

                                   ARTICLE III
                                    REMEDIES

         Upon the occurrence of any Event of Default, Mortgagee shall have the
following rights and remedies set forth in sections 3.01 through 3.08:

         3.01. Acceleration. Notwithstanding the stated maturity date in the
Note, or any note evidencing any Future Advance, Mortgagee may without notice or
demand, declare the entire principal amount of the Note and/or any Future
Advances then outstanding and accrued and unpaid interest thereon, and all other
sums or payments required thereunder including, but not limited to the
Prepayment Premium described in the Note, to be due and payable immediately.

         3.02. Entry. Irrespective of whether Mortgagee exercises the option
provided in section 3.01 above, Mortgagee in person or by agent or by
court-appointed receiver (and Mortgagee shall have the right to the immediate
appointment of such a receiver without regard to waste, the adequacy of the
security, or the insolvency of the Mortgagor and Mortgagor hereby irrevocably
consents to such appointment and waives notice of any application therefor)
whether or not foreclosure proceedings have been commenced, whether or not a
foreclosure sale has occurred; such appointment may be made either before or
after sale, without notice, without regard to the solvency or insolvency of
Mortgagor at the time of application for such receiver and without regard to the
then value of the Property or the adequacy of Mortgagee's security; Mortgagee or
any holder of the Note may be appointed as such receiver may, at its option,
without any action on its part being required, without in any way waiving such
Event of Default, with or without the appointment of a receiver, or an
application therefor:

               (A) take possession of the Property and conduct tests of, manage
or hire a manager to manage, lease and operate the Property or any part thereof,
on such terms and for such period of time as Mortgagee may deem proper, with
full power to make, from time to time, all alterations, renovations, repairs or
replacements thereto as may seem proper to Mortgagee;

                                      27
<PAGE>


              (B) with or without taking possession of the Property, collect and
receive all Rents and Profits, notify tenants under the Leases or any other
parties in possession of the Property to pay Rents and Profits directly to
Mortgagee, its agent or a court-appointed receiver and apply such Rents and
Profits to the payment of:

                   (1) all reasonable fees of the receiver approved by the
court;

                   (2) all tenant security deposits then owing to tenants under
any of the leases pursuant to the provisions of Minn Stat.ss.504.20 or
otherwise;

                   (3) all prior to current real estate taxes and special
assessments with respect to the Property or if the Mortgage requires periodic
escrow payments for such taxes and assessments, to the escrow payments then due;

                   (4) all premiums then due for the insurance required by the
provisions of the Mortgage, or if the Mortgage requires periodic escrow payments
for such premiums, to the escrow payments then due;

                   (5) expenses incurred for normal maintenance of the Property;

                   (6) if received prior to any foreclosure sale of the
Property, to the Mortgagee for the indebtedness secured by the Mortgage, but no
such payment made after acceleration of the indebtedness shall affect such
acceleration;

                   (7) if received during or with respect to the period of
redemption after a foreclosure sale of the Property;

                        (i) If the purchaser at the foreclosure  sale is not the
Mortgagee,  first to the Mortgagee to the extent of any deficiency of the sale
proceeds to repay the indebtedness secured by this Mortgage, second to the
purchaser as credit to the redemption price, but if the Property is not
redeemed, then to the purchaser of the Property;

                        (ii) If the purchaser at the foreclosure sale is the
Mortgagee, to the Mortgagee to the extent of any deficiency of the sale proceeds
to repay the indebtedness secured by this Mortgage and the balance to be
retained by the Mortgagee as a credit to the redemption price, but it the
Property is not redeemed, then to the Mortgagee, whether or not any such
deficiency exists.

              (C) exclude Mortgagor, its agents and servants, wholly from the
Property;

              (D) have joint access with Mortgagor to the books, papers and
accounts of Mortgagor relating to the Property, at the expense of Mortgagor;

                                      28
<PAGE>


              (E) commence, appear in and/or defend any action or proceedings
purporting to affect the interests, rights, powers and/or duties of Mortgagee
hereunder, whether brought by or against Mortgagor or Mortgagee; and

              (F) pay purchase, contest or compromise any claim, debt, lien,
charge or encumbrance which in the judgment of Mortgagee may affect or appear to
affect the interest of Mortgagee or the rights, powers and/or duties of
Mortgagee hereunder.

The receipt by Mortgagee of any Rents and Profits pursuant to this Mortgage
after the institution of foreclosure or other proceedings under the Mortgage
shall not cure any such Event of Default or affect such proceedings or any sale
pursuant thereto. The rights and powers of the Mortgagee under this Mortgage and
the application of Rents and Profits under this section shall continue until
expiration of the redemption period from any foreclosure sale, whether or not
any deficiency remains after a foreclosure sale. After deducting the expenses
and amounts set forth above in this section 3.02, as well as just and reasonable
compensation for all Mortgagee's employees and other agents (including, without
limitation, reasonable and actual attorneys' fees and management and rental
commissions) engaged and employed, the moneys remaining, at the option of
Mortgagee, may be applied to the indebtedness secured hereby. Any amounts
collected hereunder by Mortgagee which are in excess of those applied to pay in
full the aforesaid liabilities and indebtedness at the time due shall be
promptly paid to Mortgagor. Whenever all amounts due on the Note and under this
Mortgage shall have been paid and all Events of Default have been cured and any
such cure has been accepted by Mortgagee, Mortgagee shall surrender possession
to Mortgagor. The same right of entry, however, shall exist if any subsequent
Event of Default shall occur; provided, however, Mortgagee shall be under any
obligation to make any of the payments or do any of the acts referred to in this
section 3.02.

         3.03. Judicial Action. Mortgagee may bring an action in any court of
competent jurisdiction to foreclose this instrument or to enforce any of the
covenants and agreements hereof The Property may be foreclosed in parts or as an
entirety.

         3.04 Power of Sale. The Mortgagee may (and is hereby authorized and
empowered to) foreclose this Mortgage by action or advertisement, pursuant to
the statutes of the State of Minnesota in such case made and provided, power
being expressly granted to sell the Mortgaged Property at public auction and
convey the same to the purchaser in fee simple and, out of the proceeds arising
from such sale, to pay all indebtedness with interest, and all legal costs and
charges of such foreclosure and the maximum attorneys' fees permitted by law,
which costs, charges and fees the Mortgagor agrees to pay. Should Mortgagee
elect to sell the Property, or any part thereof, which is real property as
provided above, Mortgagee shall give such notice of default and election to sell
as may then be required by law. Thereafter, upon the expiration of such time and
the giving of such notice of sale as may then be required by law, and without
the necessity of any demand on Mortgagor, Mortgagee, at the time and place
specified in the notice of sale, shall sell the Property or any part thereof at
public auction to the highest bidder for cash in lawful money of the United
States payable at the time of sale. Mortgage may, from time to time, postpone
any sale hereunder by public announcement thereof at the time and place noticed

                                      29
<PAGE>


therefor or by giving notice of the time and place of the postponed sale in the
manner required by law. If the Property consists of several lots, parcels or
items of property, Mortgagee may designate the order in which such lots, parcels
or items shall be offered for sale or sold. Any person, including Mortgagor or
Mortgagee, may purchase at any sale hereunder, and Mortgagee shall have the
right to purchase at any sale hereunder by crediting upon the bid price the
amount of all or any part of the indebtedness hereby secured plus interest, late
charges, prepayment fees, and reasonable attorneys' fees and trustees' fees, as
herein provided.

         3.05. Rescission of Notice of Default. Mortgagee, from time to time
before Mortgagee's sale, public sale or deed in lieu of foreclosure, may
rescind any such notice of breach or default and of election to cause the
Property to be sold by executing and delivering to Mortgagee a written notice of
such rescission, which notice, when recorded, shall also constitute a
cancellation of any prior declaration of default and demand for sale or such
documents as may be required by the laws of the state in which the Property is
located to effect such rescission. The exercise by Mortgagee of such right of
rescission shall not constitute a waiver of any breach or Event of Default then
existing or subsequently occurring, or impair the right of Mortgagee to execute
and deliver to Mortgagor, as above provided, other declarations of default and
demand for sale, and notices of breach or default, and of election to cause the
Property to be sold to satisfy the obligations hereof, nor otherwise affect any
provision, agreement, covenant or condition of the Note and/or of this Mortgage
or any of the rights, obligations or remedies of the parties hereunder.

         3.06. Mortgagee's Remedies Respecting Collateral. Mortgagee may realize
upon the Collateral, enforce and exercise all of the Mortgagor's rights, powers,
privileges and remedies in respect of the Collateral, dispose of or otherwise
deal with the Collateral in such order as Mortgagee may in its discretion
determine, and exercise any and all other rights, powers, privileges and
remedies afforded to a secured party under the laws of the state in which the
Property is located as well as all other rights and remedies available at law or
in equity.

         3.07. Proceeds of Sales. The proceeds of any sale made under or by
virtue of this Article III, together with all other sums which then may be held
by Mortgagee under this Mortgage, whether under the provisions of this Article
III or otherwise, shall be applied as follows:

              (A) To the payment of the costs, fees and expenses of sale and of
any Judicial proceedings wherein the same may be made, including the cost of
evidence of title in connection with the sale, and to the payment of all
expenses, liabilities and advances made or incurred by Mortgagee under this
Mortgage, together with interest on all advances made by Mortgagee at the
interest rate applicable under the Note, but limited to any maximum rate
permitted by law to be charged by Mortgagee;

              (B) To the payment of any and all sums expended by Mortgagee under
the terms hereof, not then repaid, with accrued interest at the Default Rate set
forth in the Note, and all other sums (except advances of principal and interest
thereon) required to be paid by

                                      30
<PAGE>


Mortgagor pursuant to any provisions of this Mortgage, or the Note, or any note
evidencing any Future Advance, or any of the Related Agreements, including,
without limitation, all expenses, liabilities and advances made or incurred by
Mortgagee under this Mortgage or in connection with the enforcement thereof,
together with interest thereon as herein provided; and

               (C) To the payment of the entire amount then due, owing or unpaid
for principal and interest upon the Note, any notes evidencing any Future
Advance, and any other obligation secured hereby, with interest on the unpaid
principal at the rate set forth therein from the date of advancement thereof
until the same is paid in full; and then

              (D) The remainder, if any, to the person or persons, including the
Mortgagor, legally entitled thereto.

         3.08. Condemnation and Insurance Proceeds. All Condemnation Proceeds,
Insurance Proceeds and any interest earned thereon shall be paid over either by
the condemning authority, insurance company or escrow agent to Mortgagee and
shall be applied first toward reimbursement of the costs and expenses of
Mortgagee (including reasonable attorneys' fees), if any, in connection with the
recovery of such Proceeds, and then shall be applied in the sole and absolute
discretion of Mortgagee and without regard to the adequacy of its security under
this Mortgage (A) to the payment or prepayment of all or any portion of the Note
including the Prepayment Premium described in the Note; (B) to the reimbursement
of expenses incurred by Mortgagee in connection with the restoration of the
Property; or (C) to the performance of any of the covenants contained in this
Mortgage as Mortgagee may determine. Any prepayment of the Note or portion
thereof pursuant to Mortgagee's election under this section shall be subject to
the Prepayment Premium described in the Note.

         3.09. Waiver of Marshalling, Rights of Redemption, Homestead and
Valuation.

               (A) Mortgagor, for itself and for all persons hereafter claiming
through or under it or who may at any time hereafter become holders of liens
junior to the lien of this Mortgage, hereby expressly waives and releases all
rights to direct the order in which any of the Property shall be sold in the
event of any sale or sales pursuant hereto and to have any of the Property
and/or any other property now or hereafter constituting security for any of the
indebtedness secured hereby marshaled upon any foreclosure of this Mortgage or
of any other security for any of said indebtedness.

               (B) To the fullest extent permitted by law, Mortgagor, for itself
and all who may at any time claim through or under it, hereby expressly waives,
releases and renounces all rights of redemption from any foreclosure sale, all
rights of homestead, exception, monitoring reinstatements, forbearance,
appraisement, valuation, stay and all rights under any other laws which may be
enacted extending the time for or otherwise affecting enforcement or collection
of the Note, the debt evidenced thereby, or this Mortgage.

                                      31
<PAGE>


         3.10. Remedies Cumulative. No remedy herein conferred upon or reserved
to Mortgagee is intended to be exclusive of any other remedy herein or by law
provided, but each shall be cumulative and shall be in addition to every other
remedy given hereunder or now or hereafter existing at law or in equity or by
statute. No delay or omission of Mortgagee to exercise any right or power
accruing upon any Event of Default shall impair any right or power or shall be
construed to be a waiver of any Event of Default or any acquiescence therein.
Every power and remedy given by this Mortgage to Mortgagee may be exercised
separately, successively or concurrently from time to time as often as may be
deemed expedient by Mortgagee. If there exists additional security for the
performance of the obligations secured hereby, Mortgagee, at its sole option,
and without limiting or affecting any of its rights or remedies hereunder, may
exercise any of the rights and remedies to which it may be entitled hereunder
either concurrently with whatever rights and remedies it may have in connection
with such other security or in such order as it may determine. Any application
of any amounts or any portion thereof held by Mortgagee at any time as
additional security or otherwise, to any indebtedness secured hereby shall not
extend or postpone the due dates of any payments due from Mortgagor to Mortgagee
hereunder or under the Note, any Future Advance, or under any of the Related
Agreements, or change the amounts of any such payments or otherwise be construed
to cure or waive any default or notice of default hereunder or invalidate any
act done pursuant to any such default or notice.

         3.11. Limited Recourse. Except as otherwise set forth in this section,
the liability of Mortgagor and the general partners of Mortgagor, if any, under
the Note, this Mortgage and the Related Agreements shall be limited to and
satisfied from the Property and the proceeds thereof, the Rents and Profits and
all other income arising therefrom, the other assets of Mortgagor arising out of
the Property which are given as collateral for the Note, and any other
collateral given in writing to Mortgagee as security for repayment of the Note
(all of the foregoing collectively referred to as the "Loan Collateral");
provided, however, that nothing contained in this section shall (A) preclude
Mortgagee from foreclosing the lien of this Mortgage or from enforcing any of
its rights or remedies in law or in equity against Mortgagor except as stated in
this section, (B) constitute a waiver of any obligation evidenced by the Note or
secured by this Mortgage or any Related Agreements, (C) limit the right of
Mortgagee to name Mortgagor as a party defendant in any action brought under
this Mortgage, the Note or any Related Agreements, (D) prohibit Mortgagee from
pursuing all of its rights and remedies against any guarantor or surety, whether
or not such guarantor or surety is a partner of Mortgagor, (E) limit the
personal liability of Mortgagor or any shareholder of Mortgagor, or any general
partner of Mortgagor, or of any member of Mortgagor, to Mortgagee, for
misappropriation or misapplication of funds, fraud, waste, willful
misrepresentation, willful damage to the Property, or failure to pay real estate
taxes and/or assessments or (F) preclude Mortgagee from recovering from
Mortgagor and the Indemnitors under that certain Environmental Indemnity
Agreement of even date herewith. Notwithstanding the foregoing, Mortgagor shall
be personally liable to Mortgagee for the payment of principal due under the
Note and the liabilities and obligations under this Mortgage and any Related
Agreements in a maximum amount equal to (i) the payment of the equivalent tenant
rental obligation allocable to the tenant space Ag-Chem Equipment Co., Inc. (or
its successors or assigns) leases in the Property based on 46,214 square feet at
an annual

                                      32
<PAGE>


rental rate of $11 per square foot ($42,362.83 per month) and (ii) the prorata
operating expenses of the Property allocable to such tenant space, for the
unexpired portion of a lease term commencing no later than September 1, 2000 and
expiring no earlier than October 1, 2012, and Holder shall have full recourse
thereon against the Maker.

     3.12. Evasion of Prepayment Premium. Mortgagor agrees that in the event
Mortgagee exercises its right to accelerate the maturity date of the Note
following an Event of Default, a tender of payment of an amount necessary to
satisfy the entire indebtedness evidenced by the Note, but without including the
Prepayment Premium described in the Note, made at any time prior to foreclosure
sale either by Mortgagor, its successors and assigns or by anyone on behalf of
Mortgagor, shall be deemed to constitute an evasion of the prepayment provisions
of the Note and such payment shall therefore be deemed to be a prepayment under
the Note, and to the extent permitted by law, shall include the Prepayment
Premium described in the Note.

                                   ARTICLE IV
                                  MISCELLANEOUS

         4.01. Severability. In the event any one or more of the provisions
contained in this Mortgage shall for any reason be held to be invalid, illegal
or unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision of this Mortgage, but this Mortgage shall
be construed as if such invalid, illegal or unenforceable provision had never
been contained herein, but only to the extent that it is invalid, illegal or
unenforceable.

         4.02. Certain Charges and Brokerage Fees.

              (A) Mortgagor agrees to pay Mortgagee for each written statement
requested of Mortgagee as to the obligations secured hereby, furnished at
Mortgagor's request. Mortgagor further agrees to pay the charges of Mortgagee
for any other service rendered Mortgagor, or on its behalf, connected with this
Mortgage or the indebtedness secured hereby, including, without limitation, the
delivery to an escrow holder of a request for full or partial release or
reconveyance of this Mortgage, transmittal to an escrow holder of moneys secured
hereby, changing its records pertaining to this Mortgage and indebtedness
secured hereby to show a new owner of the Property, and replacing an existing
policy of insurance held hereunder with another such policy.

              (B) Mortgagor agrees to indemnify and hold Mortgagee harmless from
any responsibility and/or liability for the payment of any commission charge or
brokerage fees to anyone which may be payable in connection with the funding of
the loan evidenced by the Note and this Mortgage or refinancing of any prior
indebtedness, if applicable, based upon any action taken by Mortgagor. It is
understood that any such commission charge or brokerage fees shall be paid
directly by Mortgagor to the entitled parties.

         4.03. Notices.

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<PAGE>


              (A) All notices expressly provided hereunder to be given by
Mortgagee to Mortgagor and all notices, demands and other communications of any
kind or nature whatever which Mortgagor may be required or may desire to give to
or serve on Mortgagee shall be in writing and shall be (1) hand-delivered,
effective upon receipt, (2) sent by United States Express Mail or by private
overnight courier, effective upon receipt, or (3) served by certified mail, to
the appropriate address set forth below, or at such other place as the Mortgagor
or Mortgagee, as the case may be, may from time to time designate in writing by
ten (10) days prior written notice thereof Any such notice or demand served by
certified mail, return receipt requested, shall be deposited in the United
States mail, with postage thereon fully prepaid and addressed to the party so to
be served at its address above stated or at such other address of which said
party shall have theretofore notified in writing, as provided above, the party
giving such notice. Service of any such notice or demand so made shall be deemed
effective on the day of actual delivery as shown by the addressee's return
receipt or the expiration of three (3) business days after the date of mailing,
whichever is the earlier in time. Any notice required to be given by Mortgagee
shall be equally effective if given by Mortgagee's agent, if any.

               (B) Mortgagor hereby requests that any notice, demand, request or
other communication (including any notice of an Event of Default and notice of
sale as may be required by law) desired to be given or required pursuant to the
terms hereof be addressed to Mortgagor as follows:

               Ag-Chem Equipment Co., Inc.
               5720 Smetana Drive
               Minnetonka, Minnesota 55343-9688
               Attention: Chief Financial Officer

         All notices and other communications to Mortgagee shall be addressed as
follows:

               Allstate Life Insurance Company
               Allstate Plaza South, Suite G5C
               3075 Sanders Road
               Northbrook, Illinois 60062
               Attention: Commercial Mortgage Loan Servicing Manager

               With a copy to:

               Allstate Insurance Company
               Investment Law Division
               Allstate Plaza South, Suite G5A
               3075 Sanders Road
               Northbrook, Illinois 60062

         4.04. Mortgagor Not Released; Certain Mortgagee Acts.

                                       34
<PAGE>


              (A) Extension of the time for payment or modification of the terms
of payment of any sums secured by this Mortgage granted by Mortgagee to any
successor in interest of Mortgagor shall not operate to release, in any
manner, the liability of Mortgagor. Mortgagee shall not be required to: commence
proceedings against such successor or refuse to extend time for payment or
otherwise modify the terms of payment of the sums secured by this Mortgage, by
reason of any demand made by Mortgagor. Without affecting the liability of any
person, including Mortgagor, but subject to the terms and provisions of section
3.11, for the payment of any indebtedness secured hereby, or the legal operation
and effect of this Mortgage on the remainder of the Property for the full amount
of any such indebtedness and liability unpaid, Mortgagee is respectively
empowered as follows: Mortgagee may from time to time and without notice (1)
release any person liable for the payment of any of the indebtedness; (2) extend
the time or otherwise alter the terms of payment of any of the indebtedness;
(3) accept additional real or personal property of any kind as security
therefor, whether evidenced by deeds of trust, mortgages, security agreements or
any other instruments of security; or (4) alter, substitute or release any
property securing the indebtedness.

               (B) Mortgagee may, at any time, and from time to time, (1)
consent to the making of any map or plan of the Property or any part thereof,
(2) join in granting any easement or creating any restriction thereon; (3) join
in any subordination or other agreement affecting this Mortgage or the legal
operation and effect or charge hereof, or (4) release or reconvey, without any
warranty, all or part of the Property from the lien of this Mortgage.

         4.05. Inspection. Upon reasonable prior notice and subject to the
inspection rights of tenants under the Leases, Mortgagee may at any reasonable
time make or cause to be made entry upon and make inspections, reappraisals,
surveys, construction and environmental testing of the Property or any part
thereof in person or by agent, all at Mortgagee's sole cost and expense.

         4.06. Release or Satisfaction. Upon the payment in full of all sums
secured by this Mortgage, Mortgagee shall cancel and release this Mortgage and
shall surrender this Mortgage and all notes evidencing indebtedness secured by
this Mortgage to Mortgagor. The duly recorded release of the Property shall
constitute a reassignment of the Leases by the Mortgagee to the Mortgagor.
Mortgagor shall pay all fees of Mortgagee, and costs of recordation, if any.
The recitals in such release or reconveyance of any matters or facts shall be
conclusive proof of the truthfulness thereof.

         4.07. Statute of Limitations. Mortgagor hereby expressly waives and
releases to the fullest extent permitted by law, the pleading of any statute of
limitations as a defense to any and all obligations secured by this Mortgage.

         4.08. Interpretation. Wherever used in this Mortgage, unless the
context otherwise indicates a contrary intent, or unless otherwise specifically
provided herein, the word "Mortgagor" shall mean and include both Mortgagor and
any subsequent owner or owners of the Property, and the word "Mortgagee" shall
mean and include not only the original Mortgagee.

                                      35
<PAGE>


hereunder but also any future owner and holder, including pledges, of the Note
or other obligations secured hereby. In this Mortgage whenever the context so
requires, the masculine gender includes the feminine and/or neuter, and the
neuter includes the feminine and/or masculine, and the singular number includes
the plural. In this Mortgage, the use of the word "including" shall not be
deemed to limit the generality of the term or clause to which it has reference,
whether or not non-limiting language (such as "without limitation," or "but not
limited to," or words of similar import) is used with reference thereto.

         4.09. Captions. The captions and headings of the Articles and sections
of this Mortgage are for convenience only and are not to be used to interpret,
define or limit the provisions hereof.

         4.10. Consent. The granting or withholding of consent by Mortgagee to
any transaction as required by the terms hereof shall not be deemed a waiver of
the right to require consent to future or successive transactions. Mortgagor
covenants and agrees to reimburse Mortgagee promptly on demand for all legal and
other expenses incurred by Mortgagee or its servicing agent in connection with
all requests by Mortgagor for consent or approval under this Mortgage.

         4.11. Delegation to Subagents. Wherever a power of attorney is
conferred upon Mortgagee hereunder or the Related Agreements, it is understood
and agreed that such power is conferred with full power of substitution, and
Mortgagee may elect in its sole discretion to exercise such power itself or to
delegate such power, or any part thereof, to one or more subagents.

         4.12. Successors and Assigns. All of the grants, obligations,
covenants, agreements, terms, provisions and conditions herein shall run with
the land and shall apply to, bind and inure to the benefit of, the heirs,
administrators, executors, legal representatives, successors and assigns of
Mortgagor (but this shall not permit any assignment prohibited hereby) and the
endorsees, transferees, successors and assigns of Mortgagee. In the event
Mortgagor is composed of more than one party, the obligations, covenants,
agreements, and warranties contained herein as well as the obligations arising
therefrom are and shall be joint and several as to each such party.

         4.13. Governing Law. THIS MORTGAGE IS INTENDED TO BE GOVERNED BY AND
CONSTRUED UNDER THE LAWS OF THE STATE IN WHICH THE PROPERTY IS LOCATED.
MORTGAGOR HEREBY WAIVES ITS RIGHT TO A TRIAL BY JURY.

         4.14. Changes in Taxation. If, after the date of this Mortgage, any law
is passed by the state in which the Property is located or by any other
governing entity, imposing upon Mortgagee any tax against the Property, or
changing in any way the laws for the taxation of mortgages or deeds of trust or
debts secured by mortgages or deeds of trust so that an additional or substitute
tax is imposed on Mortgagee or the holder of the Note, Mortgagor shall reimburse
Mortgagee for the amount of such taxes immediately upon receipt of written
notice from Mortgagee. Provided, however, that such requirement of payment shall
be ineffective if Mortgagor is permitted by law to pay the whole of such tax in
addition to all other payments

                                      36
<PAGE>


required hereunder, without any penalty or charge thereby accruing to Mortgagee
and if Mortgagor in fact pays such tax prior to the date upon which payment is
required by such notice.

         4.15. Maximum Interest Rate. No provision of this Mortgage or of the
Note or of any note evidencing a Future Advance shall require the payment or
permit the collection of interest in excess of the maximum non-usurious rate
permitted by applicable law. In the event such interest does exceed the maximum
legal rate, it shall be canceled automatically to the extent that such interest
exceeds the maximum legal rate and if theretofore paid, credited on the
principal amount of the Note or, if the Note has been prepaid, then such excess
shall be rebated to Mortgagor.

         4.16. Time of Essence. Time is of the essence of the obligations of
Mortgagor in this Mortgage and each and every term, covenant and condition made
herein by or applicable to Mortgagor.

         4.17. Reproduction of Documents. This Mortgage and all documents
relating thereto, specifically excluding the Note but including, without
limitation, consents, waivers and modifications which may hereafter be executed,
financial and operating statements, certificates and other information
previously or hereafter furnished to Mortgagee, may be reproduced by Mortgagee
by any photographic, photostatic, microfilm, micro-card, miniature photographic
or other similar process and Mortgagee may destroy any original document
("Master") so reproduced. Mortgagor agrees and stipulates that any such
reproduction is an original and shall be admissible in evidence as the Master in
any judicial or administrative proceeding (whether or not the Master is in
existence and whether or not such reproduction was made or preserved by
Mortgagee in the regular course of business) and any enlargement, facsimile or
further reproduction of such a reproduction shall be no less admissible.

         4.18. No Oral Modifications. This Mortgage may not be amended or
modified orally, but only by an agreement in writing signed by the party against
whom enforcement of any amendment or modification is sought.

         4.19 Future Advances.

                  (a) To the extent that this Mortgage secures Future Advances,
         the amount of such advances is not currently known. The acceptance of
         this Mortgage by the Mortgagee, however, constitutes an acknowledgment
         that the Mortgagee is aware of the provisions of Minnesota Statutes ss.
         287.05, subd. 5, and intends to comply with the requirements contained
         therein.

                  (b) The maximum principal amount of indebtedness secured by
         this Mortgage at any one time, excluding advances made by the Mortgagee
         in protection of the Property or the lien of this Mortgage, shall be
         $9,000,000.00.

                  (c) The representations contained in this Section are made
         solely for the

                                      37
<PAGE>


         benefit of county recording authorities in determining the mortgage
         registry tax payable as a prerequisite to the recording of this
         Mortgage. The Mortgagor acknowledges that such representations do not
         constitute or imply an agreement by the Mortgagee to make any future
         advances to the Mortgagor.

                  (d) Notwithstanding any other provision of this Mortgage to
         the contrary, any indebtedness as to which mortgage registry tax is
         payable shall not be secured by this Mortgage unless and until the tax
         is paid.

         4.20 Commercial Property. The Property is commercial property and is
not the homestead of any person, and is not residential or agricultural property
as those terms are defined under Minnesota Law.

                              (Signature Page to Follow)

                                       38
<PAGE>


         IN WITNESS WHEREOF, the undersigned has executed this Mortgage as of
the day and year first hereinabove written.

                                           AG-CHEM EQUIPMENT CO., INC.



                                           By:  /s/ John C. Retherford
                                                --------------------------------
                                                John C. Retherford
                                           Its: Senior Vice President and Chief
                                                Financial Officer

STATE OF MINNESOTA)
                  )ss.
COUNTY OF HENNEPIN)

         The foregoing instrument was acknowledged before me this 18th day of
September, 2000 by John C. Retherford, the Senior Vice President and Chief
Financial Officer of Ag-Chem Equipment Co., Inc., a Minnesota corporation, on
behalf of said corporation.

                                                /s/ (signature illegible)
                                                --------------------------------
                                                Notary Public

This instrument was drafted by:

Rebecca L. Rom
Faegre & Benson LLP
2200 Wells Fargo Center
90 South Seventh Street
Minneapolis, MN 55402-3901

                                       39
<PAGE>


                  EXHIBIT "A"
               (Property Description)

Lots 2, 4 and 5, Block 1, Brenwood Business Park, Hennepin County, Minnesota

Lot 3, Block 1, Brenwood Business Park, Hennepin County, Minnesota

Together with a 30.00 foot perpetual easement for access purposes and a 42.00
foot perpetual easement for access purposes over, under and across a portion of
Lot 4, Block 1, Brenwood Business Park, according to the recorded plat thereof,
pursuant to warranty deed dated October 3, 1980, recorded October 9, 1980, as
Document No. 4594610, and warranty deed dated December 23, 1981, recorded
December 23, 1981, as Document No. 4629043.

And

Together with a perpetual easement for access purposes over, under and across
the South 26.00 feet of the North 59.00 feet of Lot 2, Block 1, Brenwood
Business Park, according to the recorded plat thereof, pursuant to warranty deed
dated October 3, 1980, recorded October 9, 1980, as Document No. 4594610, and
warranty deed dated December 23, 1981, recorded December 23, 1981, as Document
No. 4629043.

                                      40
<PAGE>


                  EXHIBIT "B"

               (Fixture Filing)

         Pursuant to the security agreement contained in this Mortgage
("Security Agreement") and the appropriate Uniform Commercial Code ("UCC")
sections in the State in which the Fixtures are located, as amended and
recodified from time to time, this Mortgage shall constitute a Fixture Filing.

         1. Description of Fixtures. "Fixtures" shall include all articles of
personal property now or hereafter attached to, placed upon for an indefinite
term or used in connection with said real property, appurtenances and
improvements together with all goods and other property which are or at any time
become so related to the Property that an interest in them arises under real
estate law.

         2. Description of Collateral. The Collateral, as defined in the
Security Agreement, includes, without limitation, the following items and types
of Collateral as well as certain other items and types of Collateral:

         All equipment, fixtures, goods, inventory and all present and future
         accessions and products thereof and thereto as defined in the UCC, now
         or at any time acquired, used, or to be used for or in connection with
         the construction, use or enjoyment of the Property by Mortgagor,
         whether in the possession of Mortgagor, warehousemen, bailees or any
         other person and whether located at the Property or elsewhere,
         including without limitation:

         (A)      all building, maintenance or service equipment; building,
                  maintenance or raw materials or supplies; component parts or
                  work in process; appliances; furnishings; machinery; and
                  tools; and

         (B)      all goods and property covered by any warehouse receipts,
                  bills of lading and other documents evidencing any goods or
                  other tangible personal property of any kind (including any
                  Collateral) in which Mortgagor now or at any time hereafter
                  has any interest in connection with any or all of the Property
                  or Collateral; and

         (C)      any and all products of any accessions to any such Collateral
                  which may exist at any time.

Collateral shall not include the personal property of Mortgagor located in or
associated with the Property as a result of Mortgagor's business occupancy as a
tenant of a portion of the Property. Part of the above described goods are or
are to become Fixtures on the Property. As used in this Exhibit to qualify the
scope of Mortgagee's security interest in any of the Collateral, the phrase "in
connection with any or all of the Property or Collateral" shall be used in its
broadest and most comprehensive sense and shall include without limitation
property used or acquired (or to

                                      41
<PAGE>


be used or acquired) in connection with the improvement, development,
construction, repair or remodeling of any or all of the Property, property
arising from or in connection with the operation, use, maintenance, occupancy,
sale, lease or disposition of any or all of the Property or Collateral, property
used or acquired (or to be used or acquired) in connection with Mortgagor's
performance of any of its obligations to Mortgagee, and property acquired with
any loan proceeds. If any property is used (or to be used) for multiple or
different purposes, and one such purpose relates to any aspect of the Property
or collateral, such property shall constitute Collateral hereunder, unless
Mortgagee shall release such property from this Fixture Filing and Mortgagee's
security interest in a duly executed written instrument.

         3. Relation of Fixture filing to Mortgage. Some or all of the
Collateral described section 2 above may be or become Fixtures in which
Mortgagee has a security interest under the Security Agreement. However,
nothing herein shall be deemed to create any lien or interest in favor of the
Mortgagee under this Mortgage in any such Collateral which is not a fixture, and
the purpose of this Exhibit B is to create a fixture filing under the
appropriate Uniform Commercial Code sections in the State in which the Fixtures
are located, as amended or recodified from time to time. The rights, remedies
and interests of Mortgagee under this Mortgage are independent and cumulative,
and there shall be no merger of any lien hereunder with any security interest
created by the Security Agreement. Mortgagee may elect to exercise or enforce
any of its rights, remedies, or interests under this Mortgage as Mortgagee may
from time to time deem appropriate.

         4. Name and Address of Mortgagee:

            Allstate Life Insurance Company
            Allstate Plaza South, Suite G5C
            3075 Sanders Road
            Northbrook, Illinois 60062
            Attention: Commercial Mortgage Loan Servicing Manager

         5. Other Fixture Financing and Removal of Fixtures. (A) Mortgagee has
not consented to any other security interest of any other person in any Fixtures
and has not disclaimed any interest in any Fixtures; and (B) Mortgagee has not
agreed or consented to the removal of any Fixtures from the Property, and any
such consent by Mortgagor shall not be binding on Mortgagee. Mortgagee reserves
the right to prohibit the removal of any Fixtures by any person with the legal
right to remove any Fixtures from the Property unless and until such person
makes arrangements with (and satisfactory to) Mortgagee for the payment to
Mortgagee of all costs of repairing any physical injury to the Property which
may be caused by the removal of such Fixtures. Any such payment shall be made
directly to Mortgagee at its request, and Mortgagee may hold such payment as
additional collateral under this Mortgage. Failure by Mortgagor to cause the
delivery to Mortgagee of any such payment shall constitute both: (1) waste under
(and breach of) this Mortgage; and (2) conversion of Collateral under (and a
breach of) the Security Agreement.

                                       42