<PAGE>   1
                                                                     Exhibit 4.7


              MORTGAGE SUBORDINATION AND LIEN PRIORITY AGREEMENT

         This MORTGAGE SUBORDINATION AND LIEN PROPERTY AGREEMENT ("Agreement")
is made as of October 12, 1998, by and among:

         FIRST UNION NATIONAL BANK, successor by merger to CoreStates Bank, N.A.
         ("Bank"), having a mailing address of 123 S. Broad Street,
         Philadelphia, PA 19109;

         THE PENNSYLVANIA INDUSTRIAL DEVELOPMENT AUTHORITY ("PIDA"), having a
         mailing address of Room 480, Forum Building, Harrisburg, PA 17120;

         THE COMMONWEALTH OF PENNSYLVANIA, acting by and through the DEPARTMENT
         OF COMMUNITY AND ECONOMIC DEVELOPMENT ("MELF"), having a mailing
         address of Room 480, Forum Building, Harrisburg, PA 17120;

         PIDC LOCAL DEVELOPMENT CORPORATION ("PIDC Development"), having a
         mailing address of 2600 Centre Square West, 1500 Market Street,
         Philadelphia, PA 19102-2126;

         RED BELL BREWING CO. ("Red Bell"), having a mailing address of 3100
         Jefferson Street, Philadelphia, PA 19121; and

         PIDC FINANCING CORPORATION ("PIDC Financing"), having a mailing address
         of 2600 Centre Square West, 1900 Market Street, Philadelphia, PA
         19102-2126.

                                   Background

         A. PIDC Financing holds fee title to certain real estate situate in
Philadelphia, Pennsylvania and more particularly described on Exhibit "A"
attached hereto, and the improvements thereon (the "Premises"), upon which PIDC
Financing has established an Industrial Development Project as defined in the
Pennsylvania Industrial Development Authority Act, as amended, and Red Bell is
the equitable owner of the Premises under an Installment Sale Agreement dated
January 29, 1998 between PIDC Financing as seller and Red Bell as buyer.


         B. Bank is the holder of: (i) an Open End Mortgage dated January 12,
1996 and recorded on November 18, 1996, in the Philadelphia Department of
Records in Mortgage Book VCS 1846, page 219 (the "$393,000 Bank Mortgage")
which encumbers the Premises and secures an indebtedness to Bank in the original
principal amount of $393,000 (the "$393,000 Bank Loan"), evidenced and secured
by a Note dated January 12, 1996 in said principal amount executed by PIDC
Financing and Red Bell and payable to Bank, and by other documents (the
"$393,000 Bank Loan Documents"); and (ii) an Open End Mortgage dated May 2, 1996
and recorded on September 24, 1996 in Mortgage Book JTD 172, page 123 (the
"$500, 000 Bank Mortgage") which encumbers the Premises and secures an
indebtedness to Bank in the original principal amount


<PAGE>   2
of $500,000 (the "$500,000 Bank Loan"), evidenced and secured by a Note dated
May 2, 1996 in said principal amount executed by PIDC Financing and Red Bell and
payable to Bank, and by other documents (the "$500,000 Bank Loan Documents").
The $393,000 Bank Mortgage and the $500,000 Bank Mortgage were amended by
Modification and Spreader Agreement dated January 29, 1998, by and among PIDC
Financing, Red Bell and Bank and recorded on February 19, 1998 in Mortgage Book
JTD 1083, page 63.

         C. The $393,000 Bank Loan Documents and the $500,000 Bank Loan
Documents include a Security Agreement dated January 12, 1996 (the "Bank
Security Agreement") pursuant to which Red Bell granted to Bank a security
interest in certain personal property, as more particularly described therein.
Such security interests are further evidenced by UCC-1 Financing Statements, as
the same may have been amended (the "Bank Financing Statements"), described and
filed as follows: (i) with the Pennsylvania Department of State: no. 25151110
filed on February 12, 1996, and no. 25901127 filed on September 30, 1996; (ii)
with the Prothonotary of Philadelphia County: no. 96-571 filed on February 7,
1996, no. 96-4319 filed on September 25, 1996, and no. 96-4320 filed on
September 25, 1996; and (iii) with the Philadelphia Department of Records,
document recorded on May 8, 1996 in Book VCS 848, page 399.

         D. PIDA is the holder of an Open End Mortgage dated January 29, 1998
and recorded an February 19, 1998 in Mortgage Book JTD 1083, page 76 (the "PIDA
Mortgage") which encumbers the Premises and secures an indebtedness to PIDA in
the original principal amount of $392,362, evidenced and secured by a Note dated
January 29, 1998 in said principal amount executed by PIDC Financing and
payable to PIDA, and by other documents executed by PIDC Financing and/or Red
Bell.

         E. MELF is the holder of a mortgage dated January 29, 1998 and recorded
on February 19, 1998 in Mortgage Book JTD 1083, page 88 (the "MELF Mortgage")
which encumbers the Premises and secures an indebtedness to MELF in the original
principal amount of $500,000 (the "MELF Loan"), evidenced and secured by a Note
dated January 29, 1998 in said principal amount executed by Red Bell and payable
to MELF, and by other documents (tie "MELF Loan Documents").

         F. The MELF Loan Documents include a Security Agreement dated as of
January 29, 1998 (the "MELF Security Agreement") pursuant to which Red Bell
granted to MELF a security interest in certain items of personal property, as
described in Exhibit "B" attached to this Agreement (the "MELF Collateral").
Said security interest is further evidenced by UCC-1 Financing Statements filed
on February 19, 1998 with Philadelphia Department of Records in Book JTD 460,
page 94, on February 20, 1998 with the Philadelphia County Prothonotary as no.
98-824, and on February 27, 1998 with the Pennsylvania Secretary of State as no.
28601735 (the "MELF Financing Statements").



                                        -2-
<PAGE>   3
         G. PIDC Development is the holder of a Mortgage of even date herewith
and intended to be recorded forthwith (the "$398,000 SBA Mortgage") which
encumbers the Premises and secures an indebtedness to PIDC Development in the
original principal amount of $398,000 (the "$398,000 SBA Loan"), evidenced and
secured by a Note of even date herewith in said principal amount executed by Red
Bell and payable to PIDC Development, and by other documents (the "$398,000 SBA
Loan Documents"). The $398,000 SBA Loan is a loan made to Red Bell under the
"504" loan program of the United States Small Business Administration ("SBA")
and contemplates the assignment of the $398,000 SBA Loan Documents to SBA as
collateral for SBA's guaranty of a $398,000 Debenture issued by PIDC
Development.

         H. PIDC Development is also the holder of a Mortgage of even date
herewith and intended to be recorded forthwith (the "$522,000 SBA
Mortgage") which encumbers the Premises and secures an indebtedness to PIDC
Development in the original principal amount of $522,000 (the "$522,000 SBA
Loan") evidenced by a Note of even date herewith in said principal amount
executed by Red Bell and payable to PIDC Development, and by other documents
(the "$522,000 SBA Loan Documents"). The $522,000 SBA Loan is a loan made to Red
Bell under the "504" loan program of SBA and contemplates the assignment of
the $522,000 SBA Loan Documents to SBA as collateral for SBA's guaranty of a
$522,000 Debenture issued by PIDC Development.

         I. By Mortgage Subordination Agreement dated January 26, 1998, and
effective as of January 29, 1998, and recorded on February 19, 1998 in Deed Book
JTD 592, page 557 (the "PIDA Subordination Agreement"), Bank subordinated the
lien of the $393,000 Bank Mortgage to the lien of the PIDA Mortgage.

         J. By Mortgage Subordination Agreement dated and effective as of
January 29, 1998 and recorded on February 19, 1998 in Deed Book JTD 592, page
565, (this "MELF Subordination Agreement") Bank subordinated the liens of the
$393,000 Bank Mortgage and the $500,000 Bank Mortgage to the lien of the MELF
Mortgage and agreed that it would, upon its receipt of the net proceeds of the
$398,000 SBA Loan and the $522,000 SBA Loan, subordinate the lien of the
$393,000 Bank Mortgage, together with related fixture filings, and the lien of
the $500,000 Bank Mortgage, together with related fixture filings, to the
mortgage liens and security interests securing the MELF Loan, the $398,000 SBA
Loan and the $522,000 SBA Loan.

         K. The $398,000 SBA Loan and the $522,000 SBA Loan are secured in part
by liens and security interests in (i) fixtures, more particularly described in
Exhibit "C" attached hereto, now or hereafter existing on the Premises
("Fixtures"), and (ii) equipment and machinery of Red Bell, more particularly
described in Exhibit "D" attached hereto ("Equipment"). The Equipment includes,
without limitation, the MELF Collateral. Such liens and security interests are
created by separate Security


                                      -3-
<PAGE>   4
Agreements of even date herewith (one for the $398,000 Loan (the "SBA $398,000
Security Agreement) and one for the $522,000 Loan (the "SBA $522,000 Security
Agreement"), together herein called the "SBA Security Agreements"), and are
evidenced by UCC-1 financing statements intended to be filed forthwith with the
Philadelphia Department of Records, the Philadelphia County Prothonotary and the
Pennsylvania Secretary of State (the "SBA Financing Statements").

         L. The parties hereto desire to set forth their agreement concerning
the priorities of their lien and other rights under the respective mortgages
held by them, the priorities of their respective security interests in the
Fixtures and the Equipment, and certain other matters, all as hereinafter set
forth.

         NOW THEREFORE, for good and valuable consideration and intending to be
legally bound, the parties hereto agree as follows:

         1. Subordination by MELF. MELF agrees that the MELF Mortgage and all of
the rights, liens and security interests granted to MELF thereunder, including
but not limited to the right to insurance and condemnation proceeds, the right
to possession, and any liens on and security interests in the Fixtures are and
shall always be subject, subordinate and postponed in lien, operation and effect
to the $398,000 SBA Mortgage and the $522,000 SBA Mortgage and to all of the
rights, liens and security interests granted to SBA thereunder.

         2. Subordination by Bank.

                  (a) Bank agrees that the $393,000 Bank Mortgage and the
$500,000 Bank Mortgage and all of the rights, liens and security interests
granted to Bank thereunder, including but not limited to the right to insurance
and condemnation proceeds, the right to possession and any liens on and security
interests in the Fixtures are and shall always be subordinate and postponed in
lien, operation and effect to the PIRA Mortgage, the $398,000 SBA Mortgage, the
$522,000 SBA Mortgage, and the MELF Mortgage, and to all of the rights, liens
and security interests granted respectively to PIDA, SBA and MELF thereunder.


                  (b) Bank agrees that all of the rights, liens and security
interests granted to Bank under the Bank Security Agreement and the Bank
Financing Statements and any other rights, liens and security interests Bank may
hold in and to the Equipment are and shall always be subject, subordinate and
postponed in lien, operation and effect to: (i) the rights, liens and security
interests in and to the MELF Collateral granted to MELF under the MELF Security
Agreement and the MELF Financing Statements, and (ii) the rights, liens and
security interests in and to the Equipment granted to SBA under the SBA
Security Agreements and the SBA Financing Statements.


                                      -4-
<PAGE>   5
         3. Priority of Mortgages. The parties to this Agreement hereby agree
that upon the execution of this Agreement, their respective mortgage liens,
security interests and other rights with respect to the Premises and the
Fixtures shall, as among the parties to this Agreement, be determined in
accordance with the documents listed below and in the following order of
priority:

                  (a)      First: PIDA Mortgage;

                  (b)      Second: SBA $398,000 Mortgage;

                  (c)      Third: SBA $522,000 Mortgage;

                  (d)      Fourth: MELF Mortgage;

                  (e)      Fifth: Bank $393,000 Mortgage; and

                  (f)      Sixth: Bank $500,000 Mortgage.

         4. Priority of Liens on Equipment. The parties to this Agreement hereby
agree that upon the execution of this Agreement, their respective liens,
security interests and other rights with respect to the Equipment shall be
determined in accordance with the documents listed below in the following order
of priority:

                  (a)      First: MELF Security Agreement;

                  (b)      Second: SBA $522,000 Security Agreement;

                  (c)      Third: SBA $398,000 Security Agreement; and

                  (d)      Fourth: Bank Security Agreement.

         5. Effect of this Agreement. The subordination of the mortgages, liens,
security interests and other rights and interests provided for in this Agreement
shall apply and be effective regardless of the relative dates and times of
perfection of the respective mortgages, liens, security interests and other
rights and interests granted, conveyed or given by Red Bell or PIDC Financing
to Bank, PIDA, MELF, PIDC Development and SBA, including without limitation, the
relative dates and times of (i) the recording of the $393,000 Bank Mortgage, the
$500,000 Bank Mortgage, the PIDA Mortgage, the MELF Mortgage, the $398,000 SBA
Mortgage, and the $522,000 SBA Mortgage, (ii) the filing of financing statements
or the granting of security interests in the Fixtures or the Equipment, or any
part thereof, (iii) the taking of possession of the Premises, the Fixtures or
the Equipment, or any part thereof, (iv) the obtaining of a judgment of any type
against Red Bell or PIDC Financing, (v) the commencement of an action in
mortgage foreclosure, (vi) the appointment of a receiver, (vii) the collection
of proceeds, rents, issues and/or profits from the Premises, (viii) the issuance
of writs of


                                      -5-
<PAGE>   6
execution, or (ix) the exercise of any rights or remedies with respect to the
Premises, the Fixtures or the Equipment, or any part thereof, all of the
aforesaid to apply regardless of any law or statute to the contrary. MELF and
Bank agree that the parties to this Agreement may fully rely on the terms
hereof.

         6. Future Actions. MELF, Bank and Red Bell agree and consent: (a) to
waive, and do hereby waive, any and all notice of the creation, renewal,
extension or accrual of any obligation secured by the $398,000 SBA Mortgage or
the $522,000 SBA Mortgage, present or future, in whole or in part, by PIDC
Development or SBA; and (b) that without further notice to, or further assent,
the liability of any party or parties liable for or upon the obligations secured
by the $398,000 SBA Mortgage or the $522,000 SBA Mortgage may, from time to
time, in whole or in part, be renewed, extended, modified, compromised or
released by PIDC Development and/or SBA as it or they may deem advisable.

         7. Enforcement Actions. Neither MELF nor Bank shall commence any action
for the appointment of a receiver, or commence lien enforcement or mortgage
foreclosure proceedings, or file writs of execution on all or any portion of the
Premises or the Fixtures, without the prior written consent of PIDC Development
and SBA.

         8. Duration of Agreement. This Agreement shall remain in effect at all
times during which any obligations with respect to the $398,000 SBA Loan or the
$522,000 SBA Loan shall remain outstanding. When the $398,000 SBA Loan and the
$522,000 SBA Loan have both been paid in full, with such payment to be
conclusively evidenced by the recording in the Philadelphia Department of
Records of mortgage satisfaction pieces with respect to the $398,000 SBA
Mortgage and the $522,000 SBA Mortgage, this Agreement shall, upon such
recording of mortgage satisfaction pieces, be terminated and of no further force
and effect. While in effect as aforesaid, this Agreement shall supersede the
subordinations provided for in the PIDA Subordination Agreement and the MELF
Subordination Agreement.

         9. Notices. Any notices to be given by and to the parties to this
Agreement shall be hand-delivered, or sent by certified mail, return receipt
requested or by a recognized overnight courier (e.g., Federal Express), and
shall be sent to the recipient's address as set forth at the beginning of this
Agreement, or such other address as a party may designate in writing to the
other parties. All notices shall be effective upon delivery or attempted
delivery.

         10. Amendments. This Agreement shall not be amended except by a writing
duly executed by all of the parties hereto.

         11. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original. Further, execution by
the parties may be on separate


                                      -6-
<PAGE>   7
copies of the same signature page(s) and such execution shall be fully
effective as though all signatures were on the same signature page. Any
counterpart of this Agreement that has one or more signature pages that together
contain execution by all parties shall constitute a fully executed counterpart
hereof.

         12. Further Assurances; Recording. From time to time, the parties
hereto will execute and deliver such additional documents and take such
additional actions as may be reasonably required to carry out the terms of this
Agreement. This Agreement shall be recorded.

         13. Successors Bound; Governing Law. This Agreement shall bind and
inure to the benefit of the parties hereto and their successors and assigns.
This Agreement shall be governed by the laws of the Commonwealth of
Pennsylvania.

         IN WITNESS WHEREOF, the parties have caused this


                                      -7-
<PAGE>   8
          Agreement to be executed as of the date first above written.


Witness:                                 FIRST UNION NATIONAL BANK
                                         successor by merger to CoreStates
                                         Bank, N.A.


/s/ Thomas Young                         By: /s/ James D. Brett
---------------------------                  -----------------------------
                                             Name    James D. Brett
                                             Title: Vice President






Attest:                                  THE PENNSYLVANIA INDUSTRIAL
                                         DEVELOPMENT AUTHORITY


/s/ Nancy Garman                         By: /s/ Gerald W. Kapp
---------------------------                  -----------------------------
Assistant Secretary                          Name:
[CORPORATE SEAL]                             Title: Executive Director



Witness:                                 COMMONWEALTH OF PENNSYLVANIA,
                                         acting by and through the
                                         DEPARTMENT OF COMMUNITY AND
                                         ECONOMIC DEVELOPMENT


/s/ Nancy Garman                         By: /s/ Gerald W. Kapp, Jr.
---------------------------                  -----------------------------
Assistant Secretary                          Name:
[CORPORATE SEAL]                             Title: Dir of Loans



Attest:                                  PIDC LOCAL DEVELOPMENT
                                         CORPORATION


/s/ J. A. Mee                            By: /s/ Paul J. Deegan
---------------------------                  -----------------------------
Joseph A. Mee                                Name:  Paul J. Deegan
Assistant Secretary                          Title: Senior Vice President



                       [Signatures continued on next page]


                                      -8-
<PAGE>   9
                   [Signatures continued from previous page]

                                         RED BELL BREWING CO.

Attest:


/s/ Robert T. Huttick                    By: /s/ James R. Bell
---------------------------                  -----------------------------
Robert T. Huttick,                           James R. Bell, President
Secretary


[CORPORATE SEAL]



Attest:                                  PIDC FINANCING CORPORATION


/s/ J. A. Mee                            By: /s/ Paul J. Deegan
---------------------------                  -----------------------------
Joseph A. Mee                                Name:  Paul J. Deegan
Assistant Secretary                          Title: Senior Vice President


                                      -9-
<PAGE>   10
COMMONWEALTH OF PENNSYLVANIA   :
                               :   SS.
COUNTY OF PHILADELPHIA         :


         On this 18th day of October, 1998, before me, a Notary Public,
personally appeared James D. Brett who acknowledged himself/herself to be the
Vice President of FIRST UNION NATIONAL BANK and that as such Vice President,
being authorized to do so, he/she executed the foregoing instrument for the
purposes therein contained, by signing the name of the Bank by himself/herself
as such Vice President.

         IN WITNESS WHEREOF, I hereunto set my hand and official seal.


                                        /s/ Robert J. Hassel
                                 ---------------------------------
                                             Notary Public


                                          NOTARIAL SEAL
                                  ROBERT J. HASSEL, Notary Public
                                 City of Philadelphia, Phila. County
                                 My Commission Expires April 9, 2001


                                      -10-
<PAGE>   11
COMMONWEALTH OF PENNSYLVANIA   :
                               :   SS.
COUNTY OF DAUPHIN              :

         On this 14 day of October, 1998, before me, a Notary Public, personally
appeared Gerald W. Kapp who acknowledged himself /herself to be the Executive
Director of THE PENNSYLVANIA INDUSTRIAL DEVELOPMENT AUTHORITY and that as such
Executive Director, being authorized to do so, he/she executed the foregoing
instrument for the purposes therein contained, by signing the name of the
Authority by himself/herself as such Executive Director.

         IN WITNESS WHEREOF, I hereunto set my hand and official seal.



                                 /s/ Marianne L. Brunner
                                 ---------------------------------
                                             Notary Public


                                          NOTARIAL SEAL
                                  Marianne L. Brunner, Notary Public
                                      Harrisburg Dauphin County
                                  My Commission Expires Sept. 4, 2000
                             --------------------------------------------
                             Member, Pennsylvania Association of Notaries


                                      -11-
<PAGE>   12
COMMONWEALTH OF PENNSYLVANIA  :
                              :     SS.
COUNTY OF DAUPHIN             :

         On this 14 day of October, 1998, before me, a Notary Public, personally
appeared Gerald W. Kapp Jr. who acknowledged himself to be the Director of Loans
of the PENNSYLVANIA DEPARTMENT OF COMMUNITY AND ECONOMIC DEVELOPMENT and that as
such Director of Loans, being authorized to do so, he/she executed the foregoing
instrument for the purposes therein contained, by signing the name of the
Department by himself/herself as such Director of Loans.

         IN WITNESS WHEREOF, I hereunto set my hand and official seal.


                                 /s/ Marianne L. Brunner
                                 ---------------------------------
                                             Notary Public


                                          NOTARIAL SEAL
                                  Marianne L. Brunner, Notary Public
                                      Harrisburg, Dauphin County
                                  My Commission Expires Sept. 4, 2000
                             --------------------------------------------
                             Member, Pennsylvania Association of Notaries


                                      -12-
<PAGE>   13
COMMONWEALTH OF PENNSYLVANIA   :
                               :   SS.
COUNTY OF PHILADELPHIA         :

         On this 13th day of October, 1998, before me, a Notary Public,
personally appeared Paul J. Deeqan who acknowledged himself to be the Sr. Vice
President of PIDC LOCAL DEVELOPMENT CORPORATION and that as such Sr. Vice
President, being authorised to do so, he executed the foregoing instrument for
the purposes therein contained, by signing the name of the corporation by
himself as such Sr. Vice President.

IN WITNESS WHEREOF, I hereunto set my hand and official seal.


                                 /s/ Joann D'Angelo
                                 ---------------------------------
                                             Notary Public


                                          NOTARIAL SEAL
                                   JOANN D'ANGELO. Notary Public
                                 City of Philadelphia. Phila. County
                                  My Commission Expires Dec. 21, 1998


                                      -13-
<PAGE>   14
COMMONWEALTH OF PENNSYLVANIA   :
                               :   SS.
COUNTY OF PHILADELPHIA         :


          On this 12th day of October 1998, before me, a Notary Public,
personally appeared JAMES R. BELL who acknowledged himself to be the President
of RED BELL BREWING CO. and that as such President, being authorized to do so,
he executed the foregoing instrument for the purposes therein contained, by
signing the name of the corporation by himself as such President.

          IN WITNESS WHEREOF, I hereunto set my hand and official seal.


                                 /s/ Maria-Celina Koppel
                                 ---------------------------------
                                           Notary Public

                                          [NOTARIAL SEAL]

                                MARIA-CELINA KOPPEL , Notary Public
                                City of Philadelphia, Phila. County
                                 My Commission Expires Oct. 7, 1999


                                      -14-
<PAGE>   15
COMMONWEALTH OF PENNSYLVANIA   :
                               :   SS.
COUNTY OF PHILADELPHIA         :

         On this 13th day of October, 1998, before me, a Notary Public,
personally appeared Paul J. Deegan who acknowledged himself to be the Sr. Vice
President of PIDC LOCAL FINANCING CORPORATION and that as each Sr. Vice
President, being authorized to do so, he executed the foregoing instrument for
the purposes therein contained, by signing the name of the corporation by
himself as such Sr. Vice President.

IN WITNESS WHEREOF, I hereunto set my hand and official seal.


                                 /s/ Joann D'Angelo
                                 ---------------------------------
                                          Notary Public


                                          NOTARIAL SEAL
                                   JOANN D'ANGELO. Notary Public
                                 City of Philadelphia. Phila. County
                                  My Commission Expires Dec. 21, 1998


                                      -15-
<PAGE>   16
                                  EXHIBIT "A"

                            Real Estate Description


                                      -16-
<PAGE>   17
                             DESCRIPTION and RECITAL

PREMISES "A"                           BLOCK 12 N 15 LOT 114

ALL THAT CERTAIN lot or piece of ground with the buildings and improvements
thereon erected.

SITUATE in the 29th Ward of the City of Philadelphia.

BEGINNING at a point on the North side of Jefferson Street at the distance of
191 feet 9-3/4 inches more or less from the Westerly side of 31st Street;
thence extending in a Northerly direction 169 feet 10-5/8 inches more or less to
a point; thence on a line extending in a Northwesterly direction 9 feet more or
less to a point; thence extending in a Southerly direction 177 feet 6-1/2
inches more or less to a point on the North side of Jefferson Street, thence
extending Eastwardly along the said North side of Jefferson Street 6 feet more
or less to the first mentioned point and place of beginning.

BEING ASSESSED AS 3123-1/2 Jefferson Street.

PREMISES "B"                           BLOCK 12 N 15 LOT 112

ALL THAT CERTAIN lot or piece of ground with the buildings and improvements
thereon erected, described according to a Survey and Plan thereof made by Ben H.
Joseph Surveyor and Regulator of the 3rd Survey District on the 4th day of March
A.D. 1959 as follows to wit:

BEGINNING at a point formed by the intersection of the Northeasterly side of
Jefferson Street (50 feet wide) and the Northwesterly side of 31st Street (50
feet wide) in the 29th Ward of the City of Philadelphia; thence extending from
said point of beginning North 78 degrees, 39 minutes, West along the
Northeasterly side of Jefferson Street 191 feet 9-3/4 inches to a point; thence
extending North 11 degrees, 27 minutes, 6 seconds East 169 feet 10-5/8 inches to
a point; thence extending North 38 degrees, 58 minutes West 34 feet 3/4 of an
inch to a point on the Southeasterly side of Glenwood Avenue (60 feet wide);
thence extending North 50 degrees, 54 minutes, 57 seconds East along the
Southeast side of Glenwood Avenue 114 feet 5-5/8 inches to a point; thence
extending South 78 degrees, 51 minutes East 52 feet 6-3/4 inches to a point;
thence extending South 11 degrees, 21 minutes, West 17 feet 2 inches to a point;
thence extending South 78 degrees, 51 minutes, East 92 feet 3 inches to a point
on the Northwesterly side of 31st Street; thence extending South 11 degrees, 21
minutes West along the Northwesterly side of 31st Street 263 feet 2-5/8 inches
to the first mentioned point and place of beginning.


BEING ASSESSED AS 1500-36 North 31st Street.


                                   EXHIBIT "A"
                                   Page 1 of 3
<PAGE>   18
PREMISES "C"                           BLOCK 12 N 15 LOT 20

ALL THAT CERTAIN lot or piece of ground with the buildings and improvements
thereon erected.

SITUATE in the Twenty-ninth Ward of the City of Philadelphia.

BEGINNING at the point formed by the intersection of the North line of Jefferson
Street with the center line of Glenwood Avenue; thence extending Eastwardly
along the North line of said Jefferson Street Two Hundred and Twenty-three feet,
No inches more or less to a point in the vertical plane of the Westerly face of
a brick wall extending Northward from and at right angles to the said Jefferson
Street which wall separates property herein conveyed from other property of the
former Grantors; thence Northwardly at right angles to said Jefferson Street
along the line of the westerly face of said wall One Hundred Seventy feet, Six
inches more or less to a point formed by the intersection of said line with the
center line of a wall running in a Northwesterly direction towards and at
approximately right angles to Glenwood Avenue; thence along the center line of
said latter wall North Fifty-one degrees, Two minutes West Sixty-three feet, No
inches more or less to the center line of Glenwood Avenue; thence Southwesterly
along the center line of Glenwood Avenue South Thirty-nine degrees, Five minutes
West Two Hundred and Seventy-three feet, Three feet, Three and One-half inches
more or less to the point of beginning; the said Glenwood Avenue and Jefferson
Street, being now opened and public streets of the City of Philadelphia.

BEING NO. 3125-45 West Jefferson Street.


BEING, AS TO PREMISES "A" & "B", the same premises which Wallace Leisure
Products, Inc., a Pennsylvania Corporation by Deed dated 11/2/1995 and recorded
11/9/1995 in Philadelphia County, in Deed Book VCS 1008 page 383 conveyed unto
PIDC Financing Corporation, a Pennsylvania Non-Profit Corporation, its
successors and assigns, in fee.

BEING, AS TO PREMISES "C", the same premises which J. Wilson Borden, Jr. and
Joan Martin Borden,. his wife by Deed dated 9/20/1965 and recorded 9/21/1965 in
Philadelphia County, in Deed Book CAD 548 page 271 conveyed unto Model
Warehousing and Leasing Co., a Pennsylvania Corporation, its successors and
assigns, in fee.

AND WHEREAS by the filing of Articles of merger with the Department of State for
the Commonwealth of Pennsylvania 9/30/1974, Model Warehousing and Leasing Co., a
Pennsylvania Corporation was merged with and into Wallace Leisure Products,
Inc., a Pennsylvania Corporation.

AND BEING the same premises which Wallace Leisure Products, Inc., a Pennsylvania
Corporation by Deed dated as of 11/2/1995 and recorded 10/23/1997 in
Philadelphia County in Deed Book JTD 446 page 392 conveyed unto PIDC Financing
Corporation, a Pennsylvania Non-Profit Corporation, its successors and assigns,
in fee.

AND the said PIDC Financing Corporation, a Pennsylvania Non-Profit


                                   EXHIBIT "A
                                   Page 2 of 3
<PAGE>   19
Corporation has since entered into a Installment Sale Agreement with Red Bell
Brewing Co., a Pennsylvania Corporation dated 1/29/1998 and recorded 2/19/1998
in Deed Book JTD 592 Page 568.

WARD #: 29

ST. CODE/HOUSE NO.: 46020 03123-1/2

CITY REGISTRY: 12 N 15 - 115

WARD #: ____

ST. CODE/HOUSE NO.: 88400 01500

CITY REGISTRY: 12 N 15 - 111

WARD # : 29

ST. CODE/HOUSE NO.: 46020 03125

CITY REGISTRY: 12 N 15 - 109





                                  EXHIBIT "A"
                                  Page 3 of 3
<PAGE>   20
                                   EXHIBIT "B"

                          Description of MELF Collateral

<TABLE>
<S>                                   <C>                             <C>
Brew House Equipment                  Century                          $   514,000.00
Fermentation                          Century                          $     6,500.00
Water Treatment                       Culligan                         $   385,558.00
Chiller                               York International               $    24,000.00
Chiller Piping & Installation         Penn Mechanical                  $    95,000.00
Beer Filter                                                            $     9,700.00
Bottle Line                           Meheem                           $    54,470.00
Labeling Machine                      Generic                          $    25,100.00
Lab Equipment                         Scott/Aungst                     $    32,400.00
Keg Washer                            Schirf Brewing Co.               $    28,900.00
Keg filling Machine                   Red Bank Brewing                 $    23,400.00
Refrigerator (walk in)                Penn Mechanical                  $     8,700.00
Large Refrigerator                    Johnson Building                 $    25,000.00
Chiller Water Pumps                   Merion Pump                      $    28,000.00
Spent Grain Silo                      Farm Boy                         $    16,000.00
Air Compressor/CO2 Tanks              United Air                       $     9,800.00
                                                                       --------------
                                                   TOTAL               $ 1,286,528.00
</TABLE>
<PAGE>   21
                                   EXHIBIT "C"

                             Description of Fixtures

         All fixtures including but not limited to all plumbing, heating,
lighting, ventilating, refrigerating, incinerating, air conditioning apparatus,
and elevators and all improvements now or hereafter existing on the premises
described in Exhibit "A" of this Agreement and known as 3100 Jefferson Street,
Philadelphia, PA.
<PAGE>   22
                                   EXHIBIT "D"

                            Description of Equipment

         All equipment and machinery, including power-driven machinery and
equipment, furniture and fixtures now owned or hereafter acquired by Red Bell
Brewing Co., together with all replacements thereof, all attachments,
accessories, parts and tools belonging thereto or for use in connection
therewith, EXPRESSLY EXCLUDING THEREFROM AND THEREOUT, HOWEVER, THE FOLLOWING:


<TABLE>
<CAPTION>
QTY         DESCRIPTION
--------------------------------------------------------------------------------
<S>         <C>
1           H&K BOTTLE UNCASER WITH 5-UP HEAD (24 COUNT) WITH FEED TABLE 42"
            DEEP BY 10' LONG, TYPE VA-600/5, RATED UP TO 880 BPM

1           H&K BOTTLE WASHER OMEGA KASHANA, TYPE 52/90 CI S 2, MACHINE RATED
            AT NORMAL OUTPUT OF 733 BPM WITH SIZE RANGE OF DIAMETER, MIN 50MM TO
            MAX. 76MM, MIN. HEIGHT OF BOTTLES 135MM TO MAX. HEIGHT OF 295MM

2           H&K VVF 50/10 MONO BLOCK DESIGN FILLER CLOSER MACHINE WITH LEFT TO
            RIGHT BOTTLE FEED, MACHINE SIZE RANGE DIAMETER 56MM TO 92MM, HEIGHT
            150MM TO 350MM

1           H&K PASTEURIZER TYPE P-II 35-150 RATED UP TO 700 BPM, TWO DECK
            TUNNEL DESIGN 11' 6" WIDE BY 50' LONG WORKING AREA

2           KRONES PRONTOMATIC KOM, S/N 325-326 LABELING MACHINES, ONE SET UP
            FOR LEFT TO RIGHT AND ONE SET UP RIGHT TO LEFT BOTTLE FEEDS

2           FILTEC BOTTLE INSPECTORS, MODEL EBI-II, S/N 2466R AND 2465L, ONE
            MACHINE FEEDS BOTTLES LEFT TO RIGHT AND ONE MACHINE FEEDS BOTTLES
            RIGHT TO LEFT, MACHINES RATED UP TO 850 BPM ON SIZE 58-70MM

1           H&K BOTTLE RECRATING MACHINE type VE-V-600/5 WILL HANDLE MAX BOTTLE
            HEIGHT OF 335MM, MACHINE IS 5-STATION (24 BOTTLES PER STATION)

[LOT]       BOTTLE CONVEYORS, S/S CONSTRUCTION WITH S/S CHAIN IN WIDTHS OF 3,5,
            6, AND 9 LANES INCLUDING ACCUMULATING WHERE NEEDED

[LOT]       CASE CONVEYORS FOR EMPTY AND FILLED CASES INTO AND OUT OF DECASER
            AND CASE PACKER

[LOT]       SEVERAL SETS OF CHANGE PARTS, SPARE PARTS, MANUALS AND DRAWINGS FOR
            EACH MACHINE AND COMPLETE LINE
</TABLE>