Exhibit 10.22

THIS INSTRUMENT WAS                 )
PREPARED BY AND AFTER               )
RECORDING RETURN TO:                )
Krysha X. Donoso                    )
First American Bank                 )
1650 Louis Avenue                   )
Elk Grove Village,                  )
Illinois 60007                      )
                                    )
PERMANENT INDEX #:                  )
13-21-400-019                       )
                                    )
STREET ADDRESS:                     )
22222 North Pepper Road             )
Barrington, IL  60010               )


                                    MORTGAGE


                  THIS  MORTGAGE,  made August 24,  1998,  by and between  First
American  Bank,  not  personally,  but solely as Trustee under Trust  Agreement,
dated August 14, 1998 and known as Trust No. 1-98-134  (hereinafter  referred to
as  "Mortgagor"),  and First  American  Bank,  an Illinois  banking  corporation
(hereinafter referred to as "Mortgagee");

                                   WITNESSETH:

                  WHEREAS,   CTI  Industries,   a  Delaware   corporation   (the
"Borrower") is justly  indebted to Mortgagee in the principal sum of One Million
Two Hundred Sixty Eight Thousand and 00/100 Dollars  ($1,268,000.00),  evidenced
by the certain Fifth Term Note of even date  herewith (the "Note"),  made by the
Borrower pursuant to the Amended and Restated Loan and Security Agreement, dated
May 1, 1998, between the Borrower and Mortgagee (the "Loan Agreement"), and made
payable to the order of and  delivered  to  Mortgagee,  in and by which Note the
Borrower promised to pay the principal sum and interest as set forth in the Note
in installments as provided in the Note, with a final maturity date occurring on
September 1, 2003 (or earlier as so provided in the Note); and

                  WHEREAS,  the  Borrower,  as  beneficiary  of  Mortgagor,  has
directed Mortgagor to execute and deliver this Mortgage;

                  NOW,  THEREFORE,  the Mortgagor,  to secure the payment of the
principal  sum of money and the  interest  and other  charges  and income due in
accordance with the terms, provisions and limitations of this Mortgage, the Note
(and all extensions,  renewals,  refinancings,  modifications,  amendments,  and
replacements  thereof),  and  the  Loan  Agreement  and the  performance  of the
covenants and agreements herein contained by Mortgagor to be performed,  and the
performance of the covenants and  agreements  contained in the Loan Agreement to
be performed by the Borrower, and also in consideration of the sum of One Dollar
($1.00) in hand paid, the receipt of which is hereby acknowledged, does by these
presents  MORTGAGE and CONVEY unto  Mortgagee,  its successors and assigns,  the
real estate described on Exhibit A attached hereto and all of its estate, right,
title and interest therein, situated, lying and being in the City of Barrington,
County of Lake,  and State of Illinois,  which,  with the  property  hereinafter
described, is referred to herein as the "Premises";



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                  TOGETHER   with  all   improvements,   tenements,   easements,
fixtures,  and appurtenances thereto belonging,  and all rents, issues,  profits
and monies for so long and during all such times as  Mortgagor  may be  entitled
thereto  (which are pledged  primarily  and on a parity with the real estate and
not  secondarily),  including,  without  limiting the  foregoing,  if and to the
extent  owned  by  Mortgagor  or  the  Borrower:  (a)  all  fixtures,  fittings,
furnishings,  appliances,  apparatus, equipment and machinery including, without
limitation,  all gas and  electric  fixtures,  radiators,  heaters,  engines and
machinery,  boilers, ranges, ovens, elevators and motors, bathtubs, sinks, water
closets, basins, pipes, faucets and other air-conditioning, plumbing and heating
fixtures,  mirrors,  mantles,  refrigerating  plants,  refrigerators,  iceboxes,
dishwashers,  carpeting,  furniture,  laundry  equipment,  cooking apparatus and
appurtenances,  and  all  building  material,  supplies  and  equipment  now  or
hereafter  delivered to the Premises and intended to be installed  therein;  all
other  fixtures  and  personal  property of whatever  kind and nature at present
contained in or hereafter placed in any building standing on the Premises;  such
other goods, equipment,  chattels and personal property as are usually furnished
by landlords in letting other premises of the character of the Premises; and all
renewals or replacements  thereof or articles in substitution  thereof;  and all
proceeds and profits thereof and all of the estate, right, title and interest of
the Mortgagor in and to all property of any nature whatsoever,  now or hereafter
situated on the Premises or intended to be used in connection with the operation
thereof;  (b) all of the right,  title and interest of Mortgagor or the Borrower
in and to any  fixtures  or  personal  property  subject  to a lease  agreement,
conditional sale agreement,  chattel mortgage,  or security  agreement,  and all
deposits made thereon or therefor, together with the benefit of any payments now
or hereafter  made  thereon;  (c) all leases and use  agreements  of  machinery,
equipment  and other  personal  property  of  Mortgagor  or the  Borrower in the
categories  hereinabove  set forth,  under which  Mortgagor is the lessee of, or
entitled to use, such items; (d) all rents, income, profits, revenues, receipts,
leases, tenancies, licenses or other use agreements or arrangements now existing
or hereafter  created of the Premises or any part thereof including any business
conducted  thereon) with the right to receive and apply the same to indebtedness
due Mortgagee  and  Mortgagee may demand,  sue for and recover such payments but
shall  not be  required  to do so;  (e) all  judgments,  awards of  damages  and
settlements  hereafter  made as a  result  of or in lieu  of any  taking  of the
Premises  of any part  thereof or  interest  therein  under the power of eminent
domain,  or for any damage  (whether  caused by such taking or otherwise) to the
Premises or the  improvements  thereon or any part thereof or interest  therein,
including  any award for change of grade of  streets;  (f) all  proceeds  of the
conversion,  voluntary  or  involuntary  of any of the  foregoing  into  cash or
liquidated  claims;  (g) any monies on deposit  for the  payment of real  estate
taxes or special assessments against the Premises or for the payment of premiums
on policies of fire and other hazard insurance covering the collateral described
hereunder  or the  Premises,  and  all  proceeds  paid  for  damage  done to the
collateral  described  hereunder  or the  Premises;  and (h) all  substitutions,
replacements, additions and proceeds, including insurance and condemnation award
proceeds,  of any of the  foregoing  property;  it  being  understood  that  the
enumeration  of any specific  articles of property shall in no way exclude or be
held to exclude any items of property  not  specifically  mentioned.  All of the
land,  estate and  property  hereinabove  described,  real,  personal and mixed,
whether affixed or annexed or not (except where otherwise hereinabove specified)
and all rights hereby conveyed and mortgaged are intended so to be as a unit and
are hereby understood, agreed and declared to form a part and parcel of the real
estate and to be  appropriated  to the use of the real estate,  and shall be for
the purposes of this Mortgage deemed to be real estate




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and conveyed and mortgaged  hereby.  As to any of the property  aforesaid  which
(notwithstanding  the aforesaid  declaration  and agreement)  does not so form a
part and parcel of the real  estate,  this  Mortgage is hereby  deemed to be, as
well, a security  agreement  under the Uniform  Commercial Code in effect in the
jurisdiction in which the Premises are located  (hereinafter  referred to as the
"UCC") for the purpose of creating a security  interest in such property,  which
Mortgagor  hereby  grants to Mortgagee as Secured Party (as defined in the UCC),
securing the  indebtedness  and obligations of Mortgagor  and/or  Borrower,  and
Mortgagee shall have in addition to its rights and remedies hereunder all rights
and  remedies of a Secured  Party under the UCC. As to above  personal  property
which the UCC classifies as fixtures, this instrument shall constitute a fixture
filing and financing statement under the UCC.

                  Mortgagor  covenants  (a) that it is  lawfully  seized  of the
Premises,  (b) that the same are  subject  only to (i) the liens,  encumbrances,
conditions,  restrictions,  easements,  leases,  and  other  matters,  rights or
interests  disclosed in Schedule B (or an equivalent  section or portion) of the
mortgage loan title insurance  policy  delivered to Mortgagee,  and (ii) matters
disclosed in writing by Mortgagor to Mortgagee,  and (c) that it has good right,
full power and lawful authority to convey and mortgage the same and that it will
forever  defend the Premises and the quiet and peaceful  possession  of the same
against the lawful claims of all persons whomsoever.

                  TO HAVE  AND TO HOLD the  Premises  unto  the  Mortgagee,  its
successors and assigns, forever, for the purposes and uses herein set forth.

                           IT IS FURTHER UNDERSTOOD AND AGREED THAT:

                  2.  Maintenance,   Repair  and  Restoration  of  Improvements,
Payment of Prior Liens.  Mortgagor shall (a) promptly repair, restore or rebuild
any buildings or improvements  now or hereafter on the Premises which may become
damaged or be  destroyed;  (b) keep the Premises in good  condition  and repair,
without waste,  and free from mechanics' liens or other liens or claims for lien
not expressly subordinated to the lien hereof (except for mechanics' liens being
contested in good faith and as to which adequate reserves have been set aside in
conformity with generally accepted accounting principles consistently maintained
by the Borrower);  (c) pay when due any  indebtedness  which may be secured by a
lien or charge on the  Premises  superior to the lien  hereof,  and upon request
exhibit satisfactory  evidence of the discharge of such prior lien to Mortgagee;
(d) complete within a reasonable time all public  improvements  and any building
or buildings  now or at any time in process of  construction  upon the Premises;
(e) comply with all requirements of law, municipal  ordinances,  or restrictions
of record with respect to the Premises and the use thereof; (f) make alterations
in the Premises only in accordance with plans and  specifications  duly approved
by  Mortgagee;  (g)  suffer or permit  no  change in the  general  nature of the
occupancy of the Premises,  without Mortgagee's written consent; (h) initiate or
acquiesce  in no  zoning  variation  or  reclassification,  without  Mortgagee's
written consent;  (i) pay the indebtedness  secured hereby when due according to
the terms hereof or of the Loan Agreement and the Note.

                  3. Payment of Taxes.  Mortgagor  shall pay, before any penalty
attaches (except to the extent diligently contested in good faith by appropriate
proceedings  and provided  proper  reserves are  established on the books of the
Borrower),  all general taxes, and shall pay special taxes, special assessments,
water charges,  sewer service  charges,  and other charges  against the Premises
when




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due,  and shall  furnish to Mortgagee  paid tax receipts  within sixty (60) days
after the final due date of such taxes.  Mortgagee reserves the right to require
Mortgagor  to make  monthly  deposits  into an escrow  account  established  and
controlled  by  Mortgagee  for the payment of taxes under terms and in an amount
satisfactory to Mortgagee.

                  4.   Insurance.   Mortgagor  shall  cause  all  buildings  and
improvements  now or hereafter  situated on the  Premises to be insured  against
loss or damage by fire and such other  hazards as may be requested  from time to
time by Mortgagee,  including,  but not limited to, hazards  ordinarily  insured
against by other companies  similarly  situated in operating like businesses and
properties,  and including  comprehensive public liability insurance as required
by Mortgagee and flood insurance if the Premises is within an area designated by
any  government  agency as a flood risk area.  All  policies of  insurance to be
furnished  hereunder  shall be in forms,  companies and amounts  satisfactory to
Mortgagee,  with mortgagee  clauses  attached to all policies in favor of and in
form  satisfactory  to  Mortgagee,  including  a  provision  requiring  that the
coverage  evidenced  thereby  shall not be  terminated  or  materially  modified
without  thirty (30) days' prior written notice to Mortgagee.  Without  limiting
the generality of the  foregoing,  property and casualty  insurance  shall be in
amounts and forms  insuring  the full  replacement  cost of fixed  assets of the
Borrower. All policies shall name Mortgagee as an additional insured and as loss
payee.  Mortgagor shall deliver all policies,  including  additional and renewal
policies,  to Mortgagee,  and, in the case of insurance  about to expire,  shall
deliver renewal  policies not less than ten (10) days prior to their  respective
dates of expiration.  Mortgagor shall not take out separate insurance concurrent
in form or contributing in the event of loss with that required to be maintained
hereunder unless Mortgagee is included thereon under a standard mortgagee clause
acceptable to Mortgagee.  Mortgagor shall immediately  notify Mortgagee whenever
any such separate insurance is taken out and shall promptly deliver to Mortgagee
the policy or policies of such insurance.

                  5.  Adjustment  of Losses  With  Insurer  and  Application  of
Proceeds  of  Insurance.  In case of loss or damage  by fire or other  casualty,
Mortgagee  is  authorized  to (a) settle and  adjust any claim  under  insurance
policies which insure against such risks,  or (b) allow  Mortgagor to agree with
the  insurance  company or  companies on the amount to be paid in regard to such
loss. In either case, Mortgagee is authorized to collect and issue a receipt for
any such insurance  money. At the option of Mortgagee,  such insurance  proceeds
may be applied in reduction of the indebtedness  secured hereby,  whether due or
not, or may be held by Mortgagee and used to reimburse Mortgagor for the cost of
the rebuilding or restoration of buildings or improvements on the Premises. Irre
spective of whether such insurance proceeds are used to reimburse  Mortgagor for
the cost of said  rebuilding or restoration or not, and  irrespective of whether
such insurance proceeds are or are not adequate for such purpose,  the buildings
and  improvements  shall be so restored or rebuilt so as to be of at least equal
value and  substantially  the same  character as prior to such damage or destruc
tion.  If the cost of  rebuilding,  repairing  or  restoring  the  building  and
improvements  can reasonably  exceed the sum of TWENTY-FIVE  THOUSAND AND 00/100
DOLLARS ($25,000.00),  then Mortgagor shall obtain Mortgagee's approval of plans
and  specifications  for such work before such work shall be  commenced.  In any
case,  where the  insurance  proceeds  are made  available  for  rebuilding  and
restoration,  such  proceeds  shall be  disbursed  in the  manner  and under the
conditions  that Mortgagee may require and upon Mortgagee  being  furnished with
satisfactory evidence of the estimated cost of completion thereof and with




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architect's  certificates,  waivers of lien,  contractor's  and  subcontractors'
sworn  statements  and other evidence of cost and payments so that Mortgagee can
verify that the amounts disbursed from time to time are represented by completed
and in place work and that the work is free and clear of mechanics' lien claims.
If the estimated cost of completion exceeds the amount of the insurance proceeds
available,  Mortgagor immediately shall, on written demand of Mortgagee, deposit
with Mortgagee in cash the amount of such estimated excess cost. No payment made
prior to the final  completion of the work shall exceed ninety  percent (90%) of
the  value  of the  work  performed  from  time to time,  and at all  times  the
undisbursed  balance of the proceeds  remaining  in the hands of the  disbursing
party shall be at least sufficient to pay for the cost of completion of the work
free and clear of liens.  Any  surplus  which may  remain  out of the  insurance
proceeds  after  payment of the cost of building or  restoration  shall,  at the
option of Mortgagee, be applied on account of the indebtedness secured hereby or
be paid to any party entitled thereto, without interest.

                  6. Condemnation.  Mortgagor hereby assigns, transfers and sets
over unto  Mortgagee  the entire  proceeds of any award or any claim for damages
for any of the Premises taken or damaged under the power of eminent domain or by
condemnation.  Mortgagee may elect to apply the proceeds of the award upon or in
reduction of the  indebtedness  secured hereby,  whether due or not, or make the
proceeds  available for restoration or rebuilding of the Premises.  Irrespective
of whether such proceeds are made available for  restoration or rebuilding,  and
irrespective  of whether  such  proceeds  are  adequate  for such  purpose,  the
buildings and improvements shall be restored or rebuilt in accordance with plans
and  specifications  to be submitted to and approved by Mortgagee.  In the event
said proceeds are made available for rebuilding or restoration,  the proceeds of
the award  shall be  disbursed  in the  manner  and under  the  conditions  that
Mortgagee  may  require and paid out in the same manner as provided in Section 4
hereof for the payment of insurance  proceeds  toward the cost of  rebuilding or
restoration.  In such event,  if the  estimated  cost to complete  rebuilding or
restoration  exceeds  the  proceeds  of  the  condemnation   awards,   Mortgagor
immediately  shall,  on written  demand of Mortgagee,  deposit with Mortgagee in
cash the amount of such excess  cost.  Any  surplus  which may remain out of any
such award after payment of such cost of building or restoration  shall,  at the
option of Mortgagee, be applied on account of the indebtedness secured hereby or
be paid to any party entitled thereto, without interest.

                  7.  Effect  of  Extensions  of  Time.  If the  payment  of the
indebtedness  secured hereby or any part thereof is extended or varied or if any
part of any  security  for the  payment of the  indebtedness  secured  hereby is
released  or  additional  security  is  taken,  all  persons  now or at any time
hereafter  liable  therefor,  or interested  in the  Premises,  shall be held to
assent  to such  extension,  variation,  or  taking of  additional  security  or
release,  and their  liability and the lien and all  provisions of this Mortgage
shall  continue in full force,  the right of recourse  against all such  persons
being  expressly   reserved  by  Mortgagee,   notwithstanding   such  extension,
variation, taking of additional security or release.

                  8. Effect of Changes in Laws Regarding Taxation.  In the event
of the  enactment  after this date of any law of the state in which the Premises
is located  deducting from the value of the land for the purpose of taxation any
lien thereon, or imposing upon Mortgagee the payment of the whole or any part of
the taxes or  assessments  or charges  or liens  herein  required  to be paid by
Mortgagor, or changing in any way the laws relating to the taxation of mortgages
or debts




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secured by mortgages or Mortgagee's  interest in the Premises,  or the manner of
collection of taxes, so as to affect this Mortgage or the  indebtedness  secured
hereby or the holders thereof, then, and in any event, Mortgagor, upon demand by
Mortgagee, shall pay such taxes or assessments, or reimburse Mortgagee therefor,
provided,  however, that if in the opinion of counsel for Mortgagee (a) it might
be unlawful to require  Mortgagor to make such payment or (b) the making of such
payment  might result in the  imposition of interest  beyond the maximum  amount
permitted  by law,  then and in such event,  Mortgagee  may elect,  by notice in
writing given to Mortgagor, to declare all of the indebtedness secured hereby to
be and become due and payable sixty (60) days after the giving of such notice.

                  9.  Mortgage as  Security.  The  proceeds of the loan  secured
hereby are to be disbursed by Mortgagee to Mortgagor and its  beneficiaries,  in
accordance with the provisions contained in the Loan Agreement. All advances and
indebtedness  arising and accruing  under the Loan  Agreement from time to time,
whether or not the total amount  thereof may exceed the face amount of the Note,
shall be secured  hereby to the same  extent as though the Loan  Agreement  were
fully  incorporated  in this Mortgage.  In the event of any  inconsistencies  or
conflicts  between this Mortgage and the Loan  Agreement,  the terms of the Loan
Agreement shall govern and control.

                  10.  Mortgagee's  Performance  of Defaulted  Acts.  In case of
default herein, Mortgagee may, but need not, make any payment or perform any act
herein required of Mortgagor in any form and manner deemed  expedient,  and may,
but need not,  make full or partial  payments of  principal or interest on prior
encumbrances, if any, and purchase, discharge, compromise or settle any tax lien
or other  prior lien or title or claim  thereof,  or redeem from any tax sale or
forfeiture  affecting  the Premises or consent to any tax or  assessment or cure
any default of the  Landlord in any lease of the  Premises.  All monies paid for
any of the  purposes  herein  authorized  and all  expenses  paid or incurred in
connection  therewith,  including attorneys' fees, and any other monies advanced
by  Mortgagee  in regard to any tax or any leases of the  Premises or to protect
the  Premises  and the  lien  of  this  Mortgage,  shall  be so much  additional
indebtedness  secured  hereby,  and shall become  immediately due and payable on
demand and with interest thereon at the rate per annum applicable under the Note
upon and  after an  Event of  Default  under  the Loan  Agreement.  Inaction  of
Mortgagee  shall never be considered as a waiver of any right  accruing to it on
account of any default on the part of Mortgagor.

                  11. Mortgagee's Reliance on Tax Bills. Mortgagee in making any
payment  hereby  authorized:  (a) relating to taxes and  assessments,  may do so
according  to any bill,  statement  or estimate  procured  from the  appropriate
public  office  without  inquiry  into the  accuracy of such bill,  statement or
estimate or into the validity of any tax, assessment, sale, forfeiture, tax lien
or title or claim  thereof;  or (b) for the purchase,  discharge,  compromise or
settlement of any other prior lien, may do so without inquiry as to the validity
or amount of any claim for lien which may be asserted.

                  12.  Acceleration of  Indebtedness in Case of Default.  If (a)
default is made in the due and punctual payment of the principal (or any part(s)
thereof) of the Note, or the Mortgagor or the Borrower fails to pay, within (10)
days after the date on which payment thereof is due, any installment of interest
on the Note or any other sum due and payable under the Loan Agreement, the Note,
or this  Mortgage;  or (b)  default  shall  be made  in the  due  observance  or
performance  of any other of the  covenants,  agreements  or  conditions  herein
contained,




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required to be kept or performed or observed by  Mortgagor or the  Borrower;  or
(c) default  shall be made in the due  observance or  performance  of any of the
covenants,  agreements or conditions contained,  required to be kept or observed
by Mortgagor or the Borrower in any other instrument given at any time to secure
the payment of the Note;  or (d) an Event of Default  shall occur under the Loan
Agreement; or (e) Mortgagor or the Borrower or any guarantor of the indebtedness
secured hereby becomes  insolvent or bankrupt or admits in writing its inability
to pay its debts as they  mature,  or makes an  assignment  for the  benefit  of
creditors,  or  applies  for or  consents  to the  appointment  of a trustee  or
receiver for a major portion of its property or business; or (f) any petition is
filed or  proceeding is commenced  for any  attachment,  levy, or seizure of any
property of  Mortgagor  or the  Borrower or any  guarantor  of the  indebtedness
subject to a lien in favor of Mortgagee;  or any judgment or judgments,  writ or
writs, warrant or warrants of attachment, or any similar process or processes in
an aggregate  amount in excess of  $25,000.00  shall be entered or filed against
Mortgagor or the Borrower or any  guarantor of the  indebtedness  or against any
property  or  assets  of  Mortgagor  or the  Borrower  or any  guarantor  of the
indebtedness and remains  unvacated,  unbonded or unstayed for a period of sixty
(60)  days;  or  (g)  bankruptcy,  reorganization,  arrangement,  insolvency  or
liquidation proceedings or other proceedings for relief under any bankruptcy law
or similar law for the relief of debtors is instituted  by or against  Mortgagor
or the Borrower or any guarantor of the indebtedness and, if instituted  against
Mortgagor or the Borrower or any guarantor of the  indebtedness  secured hereby,
are  allowed  against  Mortgagor  or  the  Borrower  or  any  guarantor  of  the
indebtedness  or are  consented to or are not  dismissed  within sixty (60) days
after such  institution,  then and in every such case if default shall be contin
uing the whole of the indebtedness  secured hereby shall, at once, at the option
of Mortgagee, become immediately due and payable without notice to Mortgagor.

                  13. Due on Sale -- Due on  Encumbrance.  Mortgagee  may at its
option  accelerate the maturity date of the indebtedness  evidenced by the Note,
whereupon  the whole of the  indebtedness  secured  hereby  shall at once become
immediately  due and payable  (without any cure or grace  period),  if Mortgagor
shall (whether  voluntarily  or by operation of law),  without the prior written
consent  of  Mortgagee,  sell,  mortgage,  encumber,  hypothecate  or  otherwise
transfer  the  Premises  or any  part  thereof,  or  otherwise  cease to own the
Premises, or if the Borrower shall (whether voluntarily or by operation of law),
without  the prior  written  consent of  Mortgagee,  sell,  mortgage,  encumber,
hypothecate,  or otherwise transfer the beneficial  interest in Mortgagor of any
portion thereof,  or otherwise cease to own the beneficial interest in Mortgagor
or the full power of direction over Mortgagor.

                  14.  Application of Funds. If while any insurance  proceeds or
condemna tion awards are being held by Mortgagee to reimburse  Mortgagor for the
cost of rebuilding or restoration of buildings or  improvements on the Premises,
as set forth in Sections 4 or 5 hereof,  or while Mortgagor is holding  deposits
for the payment of taxes,  Mortgagee  shall be or become  entitled to, and shall
accelerate the indebtedness  secured hereby,  then and in such event,  Mortgagee
shall be entitled to apply all such insurance  proceeds and condemnation  awards
and deposits then held by it in reduction of the  indebtedness  secured  hereby,
and any  excess  held by it over the  amount of  indebtedness  then due shall be
returned to Mortgagor or any party entitled thereto, without interest.

                  15. Foreclosure;  Expense of Litigation. When the indebtedness
hereby secured,  or any part thereof,  shall become due, whether by acceleration
or




                                      -7-
<PAGE>


                                                       

otherwise, Mortgagee shall have the right to foreclose the lien of this Mortgage
for such indebtedness or part thereof. In any civil action to foreclose the lien
of this Mortgage, there shall be allowed and included as additional indebtedness
in the order or judgment for sale all  expenditures  and  expenses  which may be
paid or incurred by or on behalf of Mortgagee for attorneys'  fees,  appraiser's
fees,  outlays for  documentary  and expert  evidence,  stenographers'  charges,
publication  costs, and costs (which may be estimated as to items to be expended
after entry of the order or judgment) of procuring all such  abstracts of title,
title searches and examinations, title insurance policies, Torrens certificates,
and similar data and  assurances  with  respect to title as  Mortgagee  may deem
reasonably  necessary  either to prosecute  such civil actions or to evidence to
bidders at any sale which may be had pursuant to such order or judgment the true
condition of the title to or the value of the  Premises.  All  expenditures  and
expenses of the nature mentioned in this Section,  and such expenses and fees as
may be incurred in the protection of the Premises and maintenance of the lien of
this Mortgage,  including the fees of any attorney  employed by Mortgagee in any
litigation  or proceeding  affecting  this  Mortgage,  the Note or the Premises,
including probate,  bankruptcy and appellate proceedings, or in preparations for
the  commencement  or defense of any  proceeding or threatened  civil actions or
proceeding  shall be  immediately  due and payable by  Mortgagor,  with interest
thereon at the rate of interest applicable under the Note upon the occurrence of
an Event of  Default  under the Loan  Agreement,  and shall be  secured  by this
Mortgage.

                  16.  Application of Proceeds of Foreclosure Sale. The proceeds
of any foreclosure  sale of the Premises shall be distributed and applied in the
following  order of  priority:  first,  on  account  of all costs  and  expenses
incident  to the  foreclosure  proceedings,  including  all  such  items  as are
mentioned  in Section 14 hereof;  second,  all other  items  which may under the
terms hereof or the Loan Agreement constitute secured indebtedness additional to
that evidenced by the Note,  with interest  thereon as provided herein or in the
Loan Agreement;  third, all principal and interest remaining unpaid on the Note;
and fourth,  any overplus to  Mortgagor,  its  successors  or assigns,  as their
rights may appear.

                  17.  Appointment  of Receiver.  Upon, or at any time after the
filing of a  complaint  to  foreclose  this  Mortgage,  the court in which  such
complaint is filed may appoint a receiver of the Premises.  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  Premises or whether the same shall
be then occupied as a homestead,  and Mortgagee or any holder of the Note may be
appointed as such receiver. Such receiver shall have power to collect the rents,
issues and profits of the Premises during the pendency of such  foreclosure suit
and during the full statutory period of redemption,  whether there be redemption
or not,  as well as during  any  further  times when  Mortgagor,  except for the
intervention of such receiver,  would be entitled to collect such rents,  issues
and  profits,  and all other  powers which may be necessary or are usual in such
cases for the protection,  possession,  control, management and operation of the
Premises  during  the  whole of such  period.  The  court  from time to time may
authorize  the  receiver  to apply the net income in his hands to the payment in
whole or in part of: (a) the indebtedness  secured hereby, or by any judgment or
order  foreclosing this Mortgage,  or any tax, special  assessment or other lien
which may be or become superior to the lien hereof or of such decree, provided




                                      -8-
<PAGE>


                                                       

such  application is made prior to  foreclosure  sale; and (b) the deficiency in
case of a sale and deficiency.

                  18. Mortgagee's Right of Possession in Case of Default. In any
case in which under the  provisions of this  Mortgage,  Mortgagee has a right to
institute   foreclosure   proceedings,   whether   before  or  after  the  whole
indebtedness secured hereby is declared to be immediately due, or whether before
or after the  institution  of legal  proceedings to foreclose the lien hereof or
before or after sale thereunder,  forthwith, upon demand of Mortgagee, Mortgagor
shall  surrender to  Mortgagee  and  Mortgagee  shall be entitled to take actual
possession  of the Premises or any part thereof  personally,  or by its agent or
attorneys.  In such event  Mortgagee in its discretion  may, in accordance  with
law,  enter  upon  and take and  maintain  possession  of all or any part of the
Premises,  together with all documents,  books, records,  papers and accounts of
Mortgagor or the then owner of the Premises  relating  thereto,  and may exclude
Mortgagor, its agents or servants,  wholly therefrom and may as attorney in fact
or agent of  Mortgagor,  or in its own name as  Mortgagee  and under the  powers
herein granted,  hold, operate,  manage and control the Premises and conduct the
business,  if any, thereof,  either  personally or by its agents,  and with full
power to use such measures,  legal or equitable,  as in its discretion or in the
discretion  of its  successors  or assigns may be deemed  proper or necessary to
enforce the payment or security of the avails, rents, issues, and profits of the
Premises,  including  actions  for the  recovery  of rent,  actions in  forcible
detainer and actions in distress for rent, and with full power to: (a) cancel or
terminate  any lease or  sublease  for any cause or on any  ground  which  would
entitle  Mortgagor  to cancel  the same;  (b)  elect to  disaffirm  any lease or
sublease which is then subordinate to the lien hereof;  (c) extend or modify any
then existing leases and to make new leases, which extensions, modifications and
new leases may provide for terms to expire,  or for options to lessees to extend
or renew terms to expire, beyond the maturity date of the indebtedness hereunder
and  beyond  the  date of the  issuance  of a deed or deeds  to a  purchaser  or
purchasers at a foreclosure  sale, it being  understood and agreed that any such
leases, and the options or other such provisions to be contained therein,  shall
be binding upon  Mortgagor and all persons  whose  interests in the Premises are
subject to the lien of this Mortgage and upon the purchaser or purchasers at any
foreclosure  sale,  notwithstanding  any  redemption  from a foreclosure of this
Mortgage,  discharge of the  indebtedness  secured  hereby,  satisfaction of any
foreclosure  decree,  or  issuance  of any  certificate  of  sale or deed to any
purchaser;  (d) make all  necessary  or proper  repairs,  decorating,  renewals,
replacements,  alterations,  additions,  betterments  and  improvements  to  the
Premises as to it may seem  judicious;  (e) insure and reinsure the same and all
risks incidental to Mortgagee's  possession,  operation and management  thereof;
and (f) receive all of such avails,  rents, issues and profits,  hereby granting
full power and  authority to exercise  each and every of the rights,  privileges
and powers herein granted at any and all times  hereafter,  without prior notice
to Mortgagor  provided that  Mortgagor  shall give  subsequent  notice  thereof.
Mortgagee  shall not be  obligated to perform or  discharge,  nor does it hereby
undertake to perform or discharge,  any obligation,  duty or liability under any
leases.  Mortgagor  shall and does hereby agree to indemnify and hold  Mortgagee
harmless of and from any and all liability,  loss, damage, or expense (including
reasonable attorneys' fees) which Mortgagee may or might incur under said leases
or under or by  reason  of the  assignment  thereof  and of and from any and all
claims and demands  whatsoever which may be asserted against it by reason of any
alleged  obligations or undertakings on its part to perform or dis charge any of
the terms,  covenants or agreements  contained in said leases.  Should Mortgagee
incur any such liability, loss or damage, under said leases or




                                      -9-
<PAGE>


                                                        

under or by reason of the assignment thereof, or in the defense of any claims or
demands, the amount thereof, including costs, expenses and reasonable attorneys'
fees, shall be secured hereby, and Mortgagor shall reimburse  Mortgagee therefor
immediately upon demand.

                  19. Application of Income Received by Mortgagee. Mortgagee, in
the exercise of the rights and powers conferred herein, shall have full power to
use and apply the  avails,  rents,  issues and  profits of the  Premises  to the
payment of or on  account  of the  following,  in such  order as  Mortgagee  may
determine:

                           (a) to the payment of the  operating  expenses of the
         Premises, including cost of management, established claims for damages,
         if any, and premiums on insurance hereinabove authorized;

                           (b) to the payment of taxes and  special  assessments
         now due or which may hereafter become due on the Premises;

                           (c) to the  payment  of  all  repairs,  replacements,
         alterations,  additions,  betterments, and improvements of the Premises
         and of placing the Premises in such  condition as will, in the judgment
         of Mortgagee, make it readily marketable;

                           (d) to the payment of any indebtedness secured hereby
         or any deficiency which may result from any foreclosure sale.

                  20.  Rights  Cumulative.  Each right,  power and remedy herein
conferred  upon  Mortgagee is  cumulative  and in addition to every other right,
power or remedy,  express or implied, given now or hereafter existing, at law or
in  equity,  and each and every  right,  power and  remedy  herein  set forth or
otherwise so existing  may be  exercised  from time to time as often and in such
order as may be deemed expedient by Mortgagee, and the exercise or the beginning
of the exercise of one right, power or remedy shall not be a waiver of the right
to exercise at the same time or thereafter any other right, power or remedy, and
no delay or omission of the  Mortgagee  in the  exercise of any right,  power or
remedy  accruing  hereunder  or arising  otherwise  shall impair any such right,
power or remedy,  or be construed to be a waiver of any default or  acquiescence
therein.

                  21. Compliance With Illinois Mortgage  Foreclosure Law. In the
event  that  any  provision  in this  Mortgage  shall be  inconsistent  with any
provision of the Illinois Mortgage  Foreclosure Law (Sections 735 ILCS 5/15-1101
et seq.,  Illinois Compiled  Statutes) (herein called the "Act"), the provisions
of the Act shall take precedence over the provisions of this Mortgage, but shall
not invalidate or render unenforceable any other provision of this Mortgage that
can be construed in a manner  consistent  with the Act. If any provision of this
Mortgage  shall  grant to  Mortgagee  any  rights or  remedies  upon  default of
Mortgagor  which are more limited than the rights that would otherwise be vested
in Mortgagee under the Act in the absence of said provision,  Mortgagee shall be
vested with the rights  granted in the Act to the full extent  permitted by law.
Without  limiting the  generality  of the  foregoing,  all expenses  incurred by
Mortgagee to the extent  reimbursable  under Sections 735 ILCS 5/15-1510 and 15-
1512 of the Act,  whether  incurred  before or after any decree or  judgment  of
foreclosure,  and whether  enumerated in Section 14 of this  Mortgage,  shall be
added to the indebtedness secured by this Mortgage or by the judgment of foreclo
sure.





                                      -10-
<PAGE>


                                                      

                  22. Waiver of Statutory Rights.  Mortgagor shall not apply for
or avail itself of any appraisal,  valuation, stay, extension or exemption laws,
or any so-called  "Moratorium Laws," now existing or hereafter enacted, in order
to prevent or hinder the enforcement or foreclosure of this Mortgage, but hereby
waives the benefit of such laws.  Mortgagor,  for itself,  and all who may claim
through or under it,  waives any and all right to have the  property and estates
comprising the Premises  marshaled  upon any  foreclosure of the lien hereof and
agrees that any court having  jurisdiction  to foreclose such lien may order the
Premises sold as an entirety.  Mortgagor does hereby expressly waive any and all
rights of redemption  from any order,  judgment or decree of foreclosure of this
Mortgage on behalf of Mortgagor,  the trust estate and all persons  beneficially
interested therein, and each and every person acquiring any interest in or title
to the  Premises  subsequent  to the  date of this  Mortgage.  Mortgagor  hereby
represents and warrants to Mortgagee that it has been directed in writing by the
appropriate  beneficiaries  and holders of the power of  direction  of the trust
estate  to  expressly  waive  all  rights  of  redemption  to the  Premises  and
reinstatement  of the loan  secured  hereby  in the  manner  herein  set  forth.
Mortgagor does hereby further  expressly  waive,  to the extent now or hereafter
permitted  by law,  all rights of  reinstatement  of this  Mortgage  pursuant to
Section 15-1602 of the Act.

                  23.  Waiver of Notice.  No action for the  enforcement  of the
lien or of any provision  hereof shall be subject to any defense which would not
be good and available to the party interposing same in an action at law upon the
Note.

                  24.   Release  upon  Payment  and  Discharge  of   Mortgagor's
Obligations.  Mortgagee  shall  release  this  Mortgage  and the lien thereof by
proper instrument upon payment and discharge of all indebtedness secured hereby,
in accordance  with the terms and conditions in the Note and the Loan Agreement,
and including a reasonable fee to Mortgagee for the execution of such release.

                  25. Filing and Recording Fees.  Mortgagor will pay all filing,
registration or recording  fees, and all expenses  incident to the execution and
acknowledgment of this Mortgage and all federal,  state,  county,  and municipal
taxes, and other taxes, duties, imposts,  assessments and charges arising out of
or in connection with the execution and delivery of the Note and this Mortgage.

                  26.  Compliance  With Laws.  Except as disclosed in writing to
Mortgagee  on or before  the date  hereof,  the  Premises  and its  present  use
complies,  and  at  all  times  shall  comply,  with  all  applicable  laws  and
governmental regulations including,  without limitation, all applicable federal,
state and local laws pertaining to air and water quality, hazardous waste, waste
disposal,  air emissions and other environmental  matters,  all zoning and other
land use matters,  and utility  availability.  Except as disclosed in writing to
Mortgagee on or before the date hereof,  neither  Mortgagor  nor, to the best of
Mortgagor's  knowledge,  any previous  owner or occupier of the Premises,  used,
generated,  stored or disposed of, on, under or about the Premises any Hazardous
Materials.  For purposes of this Mortgage,  Hazardous  Materials  shall mean and
include any hazardous  substance,  hazardous  material,  toxic substance,  solid
waste, or any pollutant or contaminant  now or hereafter  defined as such in (or
for purposes of) the Comprehensive  Environmental  Response,  Compensation,  and
Liability   Act,  any  so-called   applicable   "Superfund"  or  "Superlien"  or
"Non-priority  lien" law,  the Toxic  Substances  Control  Act, or the  Resource
Conservation and Recovery Act, all as amended from time to time. Further, to the
best of Mortgagor's knowledge, except as disclosed in writing to Mortgagee on or
before the date hereof,  the Premises does not contain any underground tanks and
does not contain and has not




                                      -11-
<PAGE>


                                                    

in the past contained any  asbestos-containing  material in friable form. Mortga
gor  shall  protect,  indemnify  and hold  harmless  Mortgagee,  its  directors,
officers,  employees,  agents,  successors and assigns, from and against any and
all loss,  damage,  cost,  expense or liability  (including  attorneys' fees and
costs)  directly  or  indirectly  arising  out of or  attributable  to the  use,
generation,  manufacture,  production,  storage,  release,  threatened  release,
discharge,  disposal or presence of Hazardous Materials or asbestos on, under or
about  the  Premises   including   without   limitation   (a)  all   foreseeable
consequential  damages;  and (b) the costs of any required or necessary  repair,
cleanup or detoxification of the Premises and the preparation and implementation
of any closure,  remedial or other required plans.  This indemnity shall survive
the  payment  of the Note and the  reconveyance  or  release of the lien of this
Mortgage,  or the  extinguishment  of the  lien  by  foreclosure  or  action  in
reconveyance or  extinguishment  or deed in lieu of foreclosure.  This indemnity
shall not apply to any claims,  losses,  liabilities,  damages,  penalties,  and
expenses which are incurred by Mortgagee solely as a direct result of any act or
omission of the Mortgagee and which are not the result,  in whole or in part, of
any pre-existing  condition or event. In the event that any investigation,  site
monitoring,  containment,  clean-up, removal, restoration or other remedial work
of any kind or nature (the "Remedial Work") is reasonably necessary or desirable
under any applicable  local,  state or federal law or  regulation,  any judicial
order,  or by any  governmental  entity or person  because of, or in  connection
with, the current or future presence,  suspected presence,  release or suspected
release of any  Hazardous  Materials in or about the air,  soil,  ground  water,
surface water or soil vapor at, on, about,  under or within the Premises (or any
portion  thereof),  Mortgagor shall within thirty (30) days after written demand
for  performance  thereof by Mortgagee (or such shorter period of time as may be
required under any applicable law, regulation, order or agreement), commence and
thereafter  diligently  prosecute  to  completion,  all the Remedial  Work.  All
Remedial  Work  shall  be  performed  by  contractors  approved  in  advance  by
Mortgagee,  and under the  supervision  of a  consulting  engineer  approved  by
Mortgagee.  All costs and  expenses of Remedial  Work shall be paid by Mortgagor
including, without limitation,  Mortgagee's reasonable attorneys' fees and costs
incurred in connection  with  monitoring or review of the Remedial  Work. In the
event Mortgagor shall fail to timely prosecute to completion, the Remedial Work,
Mortgagee  may,  but shall not be required  to,  cause the  Remedial  Work to be
performed  and all  costs  and  expenses  thereof,  or  incurred  in  connection
therewith, shall become part of the indebtedness secured hereby.

                  27. Indemnity. Mortgagor agrees to indemnify and hold harmless
Mortgagee from and against any and all losses, liabilities,  suits, obligations,
fines,  damages,  judgments,  penalties,  claims,  charges,  costs and  expenses
(including  attorneys' fees and disbursements) which may be imposed on, incurred
or paid by or  asserted  against  Mortgagee  by reason or on  account  of, or in
connection  with,  (a) any willful  misconduct  of  Mortgagor  or any default by
Mortgagor  hereunder or under any other documents executed at any time to secure
the payment of the Note, (b) Mortgagee's good faith and commercially  reasonable
exercise of any of its rights and  remedies,  or the  performance  of any of its
duties,  hereunder or under any other  documents  executed at any time to secure
payment of the Note, (c) the  construction,  reconstruction or alteration of the
Premises,  (d)  any  negligence  of  Mortgagor,  or any  negligence  or  willful
misconduct of any lessee of the  Premises,  or any of their  respective  agents,
contractors,  subcontractors,  servants, employees, licensees or invitees or (e)
any accident, injury, death or damage to any person or property occurring in, on
or about the Premises or any street, drive, sidewalk, curb or passageway




                                      -12-
<PAGE>


                                            

adjacent thereto,  except for the willful  misconduct or gross negligence of the
indemnified  person. Any amount payable to Mortgagee under this Section shall be
due and  payable  within  ten (10) days after  demand  therefor  and  receipt by
Mortgagor of a statement from Mortgagee  setting forth in reasonable  detail the
amount  claimed and the basis  therefor,  and such amounts shall bear  interest,
from and after the date such amounts are paid by Mortgagee until paid in full by
Mortgagor, at the rate of interest applicable under the Note upon the occurrence
of an Event of Default under the Loan Agreement.  Mortgagor's  obligations under
this Section shall not be affected by the absence or unavailability of insurance
covering  the same or by the  failure  or refusal  by any  insurance  carrier to
perform any obligation on its part under any such policy of covering  insurance.
If any claim,  action or proceeding is made or brought against  Mortgagor and/or
Mortgagee which is subject to the indemnity set forth in this Section, Mortgagor
shall resist or defend against the same, if necessary, in the name of Mortgagee,
by  attorneys  for  Mortgagor's  insurance  carrier  (if the same is  covered by
insurance) or otherwise by attorneys approved by Mortgagee.  Notwithstanding the
foregoing,  Mortgagee, in its discretion, may engage its own attorneys to resist
or defend,  or assist  therein,  and Mortgagor  shall pay, or, on demand,  shall
reimburse Mortgagee for the payment of, the reasonable fees and disbursements of
Mortgagee's attorneys.

                  28. Giving of Notice. Any notice which either party hereto may
desire or be  required  to give to the other party shall be in writing and shall
be given in person or by the mailing  thereof by  certified  mail  addressed  to
Mortgagor at: First American Bank, 218 W. Main Street,  West Dundee, IL 60118 or
to Mortgagee at: First  American  Bank,  1650 Louis Avenue,  Elk Grove  Village,
Illinois  60007,  or at such  other  place as any party  hereto may by notice in
writing designate as a place for service of notice.

                  29.      Miscellaneous.

                           (a) This Mortgage,  and all provisions hereof,  shall
         extend to and be binding upon  Mortgagor and its  successors,  grantees
         and  assigns,  any  subsequent  owner or owners of the Premises and all
         persons claiming under or through  Mortgagor,  and the word "Mortgagor"
         when used herein shall include all such persons and all persons  liable
         for the payment of the indebtedness secured hereby or any part thereof,
         whether  or not  such  persons  shall  have  executed  the Note or this
         Mortgage.  The word  "Mortgagee"  when used  herein  shall  include the
         successors  and assigns of Mortgagee  named  herein,  and the holder or
         holders,  from time to time, of the Note. The word  "indebtedness" when
         used herein  shall  include the  principal  sum  evidenced by the Note,
         together  with all  interest,  additional  interest,  and late  charges
         thereon  and  other  sums  due  thereunder  and all  other  sums due to
         Mortgagee  under the Loan Agreement or this  Mortgage.  The word "Note"
         when used herein shall include all extensions,  renewals, refinancings,
         modifications, amendments, and replacements thereof.

                           (b)  In  the  event  one or  more  of the  provisions
         contained  in  this  Mortgage  or the  Note  or in any  other  security
         documents  given to secure the payment of the Note shall for any reason
         be held to be invalid,  illegal or unenforceable  in any respect,  such
         invalidity,  illegality  or  unenforceability  shall,  at the option of
         Mortgagee,  not affect any other  provision of this Mortgage,  and this
         Mortgage   shall  be   construed  as  if  such   invalid,   illegal  or
         unenforceable  provision  had never been  contained  herein or therein.
         This Mortgage  shall be construed and governed by the laws of the State
         of Illinois.





                                      -13-
<PAGE>


                           (c) At all  times,  regardless  of  whether  any loan
         proceeds have been disbursed, this Mortgage secures (in addition to any
         loan proceeds  disbursed  from time to time) the payment of any and all
         expenses and  advances  due to or incurred by  Mortgagee in  connection
         with   the   indebtedness    secured   hereby,    provided,    however,
         notwithstanding  anything to the contrary  herein,  the total aggregate
         indebtedness  secured by this Mortgage shall not exceed an amount equal
         to two (2) times the face amount of the Note.

                           (d) No offset or claim that  Mortgagor now has or may
         have in the future  against  Mortgagee  shall  relieve  Mortgagor  from
         paying  any  amounts  due under the Note or from  performing  any other
         obligations contained herein or secured hereby.

                           (e) Mortgagor shall not by act or omission permit any
         building or other  improvement  on the Premises not subject to the lien
         of this  Mortgage to rely on the  Premises  or any part  thereof or any
         interest therein to fulfill any municipal or governmental  requirement,
         and  Mortgagor  hereby  assigns to Mortgagee any and all rights to give
         consent for all or any portion of the Premises or any interest  therein
         to be used. Similarly, no building or other improvement on the Premises
         shall rely on any premises not subject to the lien of this  Mortgage or
         any  interest   therein  to  fulfill  any   governmental  or  municipal
         requirement.  Mortgagor  shall  not  by  act  or  omission  impair  the
         integrity of the Premises as zoned for its present or intended use. Any
         act or omission by  Mortgagor  which would result in a violation of any
         of the provi sions of this Section shall be void.

                           (f)  Mortgagee  shall have the right to  inspect  the
         Premises at all reasonable  times and access thereto shall be permitted
         for that purpose.

                  30.  Exculpatory.  This Mortgage is executed by First American
Bank,  not  personally  but as Trustee as aforesaid in the exercise of the power
and authority  conferred  upon and vested in it as Trustee,  and it is expressly
understood  and agreed that  nothing  herein or in the Note  contained  shall be
construed as creating any liability on First American Bank personally to pay the
Note or any interest that may accrue thereon, or any indebtedness, or to perform
any covenant,  either express or implied, herein contained,  all such liability,
if any, being expressly waived by Mortgagee and by every person now or hereafter
claiming any right or security hereunder, and that so far as First American Bank
personally is  concerned,  the legal holder or holders of the Note and the owner
or owners of any indebtedness  shall look solely to the Premises hereby conveyed
for the payment thereof,  by the enforcement of the lien hereby created,  in the
manner herein  provided,  by action against any other security given at any time
to  secure  the  payment  of the Note and by  action  to  enforce  the  personal
liability of the guarantors, if any.

                  IN WITNESS WHEREOF, the Mortgagor has executed this instrument
the day and year first written above.

                                                First American Bank
                                                not personally but as Trustee
                                                as aforesaid


                                                BY:__________________________ 
                                                   Its:______________________ 

                                                 


ATTEST:________________________


____________________________
Its:________________________                        






                                      -14-
<PAGE>


                                                       

STATE OF ILLINOIS          )
                           ) SS
COUNTY OF _______          )


                  I___________________________, a  Notary Public in and for said
County in the State aforesaid, DO HEREBY CERTIFY THAT __________________________
and __________________________, personally known to me and known by me to be the
__________________________and __________________________, respectively, of First
American Bank, in whose name, as Trustee,  the above and foregoing instrument is
executed,  appeared  before me this day in  person  and  acknowledged  that they
signed and delivered the said  instrument as their free and voluntary act and as
the free and voluntary act of said First American Bank, as Trustee as aforesaid,
for the uses and  purposes  therein  set  forth,  and the  said  then and  there
acknowledged  that he, as custodian of the corporate seal of said First American
Bank  did  affix  the said  corporate  seal to said  instrument  as his free and
voluntary act and as the free and voluntary act of said First  American Bank, as
Trustee as aforesaid, for the uses and purposes therein set forth.

                  GIVEN under my hand and Notarial Seal this ___ day of _______,
                                                           
19___.
 


                                        ____________________________
                                               Notary Public

My Commission Expires:

____________________________





















                                      -15-
<PAGE>



                                    EXHIBIT A
                                Legal Description

THAT PART OF THE SOUTH 1/2 OF SECTION 21,  TOWNSHIP  43 NORTH,  RANGE 9, EAST OF
THE THIRD PRINCIPAL MERIDIAN, DESCRIBED AS FOLLOWS: COMMENCING AT A POINT IN THE
EAST LINE OF THE WEST 1/2 OF THE SOUTH EAST 1/4 OF SAID SECTION 21,  983.62 FEET
NORTH OF THE SOUTHEAST CORNER THEREOF;  THENCE WEST PARALLEL WITH THE SOUTH LINE
OF SAID SOUTH EAST 1/4,  699.98 FEET;  THENCE  NORTHERLY  332.59 FEET TO A POINT
323.17  FEET  NORTH  AND  648.28  FEET WEST OF THE  POINT OF  BEGINNING;  THENCE
EASTERLY  PARALLEL TO THE SOUTH LINE OF SAID SOUTH EAST 1/4,  648.28 FEET TO THE
EAST LINE OF THE WEST 1/2 OF SAID SOUTH EAST 1/4;  THENCE  SOUTH  323.17 FEET TO
THE POINT OF BEGINNING,  (EXCEPTING  THEREFROM THE EAST 33 FEET THEREOF) IN LAKE
COUNTY, ILLINOIS.


PIN: 13-21-400-019

COMMONLY KNOWN AS: 22222 NORTH PEPPER ROAD, BARRINGTON, ILLINOIS 60010




<PAGE>


                                     JOINDER


                  FOR  GOOD  AND   VALUABLE   CONSIDERATION,   the  receipt  and
sufficiency of which are hereby acknowledged,  the undersigned,  being the owner
of 100% of the  beneficial  interest in the land trust  known as First  American
Bank  ("Mortgagor"),  hereby joins in the Mortgage made by Mortgagor in favor of
First American Bank  ("Mortgagee")  for purposes of: (a) conveying,  mortgaging,
warranting,  granting,  transferring,  setting over, and assigning to Mortgagee,
all of its right,  title,  and  interest in and to the real  property  described
therein,  including,  without limitation, all of the buildings,  structures, and
improvements now or at any time hereafter erected,  constructed,  or situated on
such real property or any part thereof and all machinery,  apparatus, equipment,
personal  property,  and fixtures of every kind and nature  whatsoever now or at
any time  hereafter  located  in,  on, or about such real  property  or any part
thereof,  and any and all rents,  issues,  income,  and profits of and from such
real property and all other property  that, if owned by Mortgagee,  would form a
portion of the Premises  subject to the lien of the  Mortgage;  and (b) agreeing
that to the extent  the  undersigned  has the right,  power,  or  obligation  to
perform  or cause the  performance  of any act that  Mortgagor  is  required  to
perform in the Mortgage or has the right,  power,  or  obligation to prohibit or
limit or cause the  prohibition  or  limitation of any act that is prohibited or
limited under the Mortgage,  the  undersigned  shall act to cause the compliance
with the provisions thereof.

                  IN  WITNESS  WHEREOF,   the  undersigned  has  joined  in  the
foregoing  Mortgage by executing  and  delivering  this Joinder as of August 24,
1998.


                                      CTI Industries


                                      By:____________________________ 
                                         Stephen M. Merrick,
                                         Chief Executive Officer







<PAGE>


                                                       

STATE OF ILLINOIS          )
                           ) SS
COUNTY OF _______          )


                  The  undersigned,  a notary  public in and for the  county and
state aforesaid,  do hereby certify that Stephen M. Merrick, the Chief Executive
Officer of CTI Industries,  who is personally  known to me to be the same person
whose name is subscribed to the  foregoing  instrument as such officer  appeared
before me this day in person and  acknowledged  that he signed and delivered the
said  instrument  as such officer as his own free and  voluntary  act and as the
free and voluntary act of said  corporation,  for the uses and purposes  therein
set forth,  and  caused the  corporate  seal of said  corporation  to be affixed
thereto.

                  Given under my hand and notarial seal on _____________, 19__.
                                                               


                                             _________________________
                                                  Notary Public



<PAGE>




THIS INSTRUMENT WAS                 )
PREPARED BY AND AFTER               )
RECORDING RETURN TO:                )
Krysha X. Donoso                    )
First American Bank                 )
1650 Louis Avenue                   )
Elk Grove Village,                  )
Illinois 60007                      )
                                    )
PERMANENT INDEX #:                  )
13-21-400-019                       )
                                    )
STREET ADDRESS:                     )
22222 North Pepper Road             )
Barrington, IL  60010               )