<PAGE> 1

                                                State ________ Site No. ________

                                   EXHIBIT G-2

                              FORM OF DEED OF TRUST


                     DEED OF TRUST, LEASEHOLD DEED OF TRUST,
                        SECURITY AGREEMENT AND ASSIGNMENT
                               OF LEASES AND RENTS



    Trustor:                  PAYLESS CASHWAYS, INC.
                                       2300 Main Street
                                       Kansas City, Missouri  64108



    Beneficiary:              CANADIAN IMPERIAL BANK OF COMMERCE,
                                         NEW YORK AGENCY,
                                         as Administrative Agent and
                                         Collateral Agent,
                                       425 Lexington Avenue
                                       New York, New York  10017



    Trustee:



    Deed of Trust
      Amount:


    Date:                     October 3, 1996



    Premises:




    Record and                EMMET, MARVIN & MARTIN, LLP
    Return to:                120 Broadway
                              New York, New York 10271
                              Attn:  John P. Uehlinger, Esq.



<PAGE> 2


             DEED OF TRUST,  LEASEHOLD  DEED OF TRUST,  SECURITY  AGREEMENT  AND
    ASSIGNMENT OF LEASES AND RENTS, dated as of the 3rd day of October, 1996, by
    and among PAYLESS CASHWAYS,  INC., an Iowa corporation,  having an office at
    2300 Main Street, Kansas City, Missouri 64108 ("Trustor"), _________________
    ("Trustee")  and CANADIAN  IMPERIAL  BANK OF COMMERCE,  NEW YORK AGENCY,  as
    Administrative   Agent  and   Collateral   Agent  under  the  Agreement  (as
    hereinafter  defined),  having an office at 425 Lexington Avenue,  New York,
    New York 10017 ("Beneficiary").


                                   DEFINITIONS

             Trustor and Beneficiary  agree that all capitalized  terms used but
    not defined herein are defined in or by reference to the Agreement and shall
    have the same meanings herein as therein.  Trustor and  Beneficiary  further
    agree  that,  unless  the  context  otherwise  specifies  or  requires,  the
    following terms shall have the meanings herein  specified,  such definitions
    to be applicable equally to the singular and the plural forms of such terms.

             "Agreement"   means  that  certain   Amended  and  Restated  Credit
    Agreement  dated on or about the date hereof by and among Payless  Cashways,
    Inc., the signatory Lenders thereto,  Canadian Imperial Bank of Commerce, as
    Letter of Credit Bank, Canadian Imperial Bank of Commerce,  New York Agency,
    as  Administrative  Agent and Collateral Agent, and The Bank of Nova Scotia,
    Nationsbank of Texas,  N.A., and Bank of America  National Trust and Savings
    Association as Co-Agents,  together with any future  amendments,  amendments
    and  restatements,  extensions,  modifications  or  supplements  thereto  or
    thereof.

             "Deed of Trust" means this Deed of Trust,  Leasehold Deed of Trust,
    Security  Agreement  and  Assignment  of Leases and Rents  together with any
    future amendments, modifications or supplements hereto or hereof.

             "Deed of Trust Amount" means the principal sum of $500,000,000.

             "Default" means Default, as that term is defined in the Agreement.

             "Default  Rate" means the rate of interest  specified in Subsection
    2.5(a) of the Agreement.

             "Event of Default" means the events and circumstances  described as
    such in Article II hereof.

             "Fixtures" means all of Trustor's right,  title and in-




<PAGE> 3

    terest in all furniture, furnishings, partitions, screens, awnings, venetian
    blinds,  window  shades,  draperies,   carpeting,  pipes,  ducts,  conduits,
    dynamos,  motors,  engines,  compressors,   generators,   boilers,  stokers,
    furnaces, pumps, tanks, elevators, escalators, vacuum cleaning systems, call
    systems, switchboards,  sprinkler systems, fire prevention and extinguishing
    apparatus,  refrigerating, air conditioning, heating, dishwashing, plumbing,
    ventilating,  gas,  steam,  electrical  and lighting  fittings and fixtures,
    licenses or permits of any kind and all building  materials,  equipment  and
    goods now or hereafter delivered to the Premises  (hereinafter  defined) and
    intended to be installed therein, and all other machinery,  fixtures, tools,
    implements,  apparatus,  appliances,  equipment, goods, facilities and other
    personal  property of similar  character in which Trustor now has, or at any
    time hereafter acquires,  an interest and which are now or hereafter affixed
    or attached to, or used in connection with the enjoyment,  occupancy  and/or
    operation  of,  all or  any  portion  of the  Premises,  together  with  all
    renewals,   replacements  and   substitutions   thereof  and  additions  and
    accessions thereto and the proceeds of all of the foregoing items.

             "Improvements"   means   all   buildings,   structures   and  other
    improvements  presently  existing  or  hereafter  constructed  on  the  land
    described in Exhibit A attached hereto.

             "Lease" has the meaning ascribed to such term in Section 3.01
    hereof.

             "Leasehold" has the meaning  ascribed to such term in paragraph "F"
    of the Granting Clause, below.

             "Leasehold  Interest"  has the  meaning  ascribed  to such  term in
    paragraph "F" of the Granting Clause, below.

             "Lessee"  has the  meaning  ascribed  to such term in Section  3.01
    hereof.

             "Loan  Documents"  means  the  Credit  Documents,  as that  term is
    defined in the Agreement.

             "Loans" means the Loans, as that term is defined in the Agreement.

             "Mortgaged  Property" has the meaning  ascribed to such term in the
    Granting Clause, below.

             "Notes" means the Notes, as that term is defined in the Agreement.

             "Premises"  means the land  described in Exhibit A annexed  hereto,
    together  with the  Improvements  thereon  or to be  constructed  thereon or
    therein,  and all of the easements,  rights,



<PAGE> 4

    privileges and appurtenances  thereunto belonging or in anywise appertaining
    thereto  including,  but not limited to, all of the  estate,  right,  title,
    interest,  claim or demand  whatsoever of Trustor  therein and in and to the
    strips and gores,  streets and ways adjacent  thereto,  whether in law or in
    equity, in possession or expectancy,  now or hereafter acquired and also any
    other realty,  Leaseholds  (hereinafter defined), or Fixtures encompassed by
    the term "Mortgaged Property", elsewhere herein defined.

             "Rents" has the meaning ascribed to such term in Section 3.01
    hereof.

             "Secured  Obligations" has the meaning ascribed to such term in the
    paragraph entitled "Secured Obligations" below.

             "Secured Parties" means Secured Parties, as that term is defined in
    the Agreement.


                              W I T N E S S E T H :

             WHEREAS,  Trustor is the actual, record and beneficial owner of the
    Premises or owns an actual beneficial interest therein;

             WHEREAS, Trustor has agreed pursuant to the terms of the Agreement,
    the  Notes,   and/or  the  other  Loan  Documents   evidencing  the  Secured
    Obligations to be liable for the Secured Obligations; and

             WHEREAS,  the parties intend that the Secured  Obligations shall be
    secured by this Deed of Trust.


                                 GRANTING CLAUSE

             NOW, THEREFORE,  Trustor, in consideration of the premises,  and in
    order to secure the payment in full of the Deed of Trust Amount, the Secured
    Obligations,  all  interest due thereon and all other costs and expenses and
    other amounts due hereunder and in respect of the Secured  Obligations,  and
    the performance and discharge of all the provisions  hereof,  of the Secured
    Obligations and all other Loan Documents,  hereby gives,  grants,  bargains,
    sells, conveys,  pledges and grants a security interest to Trustee in trust,
    with power of sale for the benefit of Beneficiary,  all of Trustor's estate,
    right,  title and  interest  in,  to and under any and all of the  following
    described  property  whether  now  owned or  hereafter  acquired  (all  such
    properties being collectively referred to as the "Mortgaged Property"):




<PAGE> 5

             A. All Trustor's  right,  title and interest in and to the Premises
    and all right,  title and interest of Trustor in and to the  Improvements on
    the Premises or to be constructed  thereon and all Fixtures now or hereafter
    situated in, on or about, or affixed or attached to the  Improvements or the
    Premises or any building,  structure or other  improvement  now or hereafter
    standing,  constructed  or placed upon or within the  Premises,  and all and
    singular the  tenements,  hereditaments,  easements,  rights-of-way  or use,
    rights,  privileges  and  appurtenances  to the  Premises,  now or hereafter
    belonging or in anywise appertaining thereto, including, without limitation,
    any such  right,  title,  interest,  claim and  demand  in, to and under any
    agreement granting,  conveying or creating, for the benefit of the Premises,
    any easement,  right or license in any way affecting  other property and in,
    to and under any  streets,  ways,  alleys,  vaults,  gores or strips of land
    adjoining the  Premises,  or any parcel  thereof,  and all claims or demands
    either in law or in equity,  in possession or expectancy,  of, in and to the
    Premises.

             B. All right,  title and  interest  of Trustor in and to all awards
    heretofore  made or hereafter to be made for the taking by eminent domain of
    the  whole or any part of the above  described  premises,  or any  estate or
    easement therein,  including any awards for change of grade of streets,  all
    of which  awards  are hereby  assigned  to Trustee  and  Beneficiary,  which
    Trustee and  Beneficiary are hereby  authorized to collect (unless  provided
    otherwise in the  Agreement)  and receive the proceeds of such awards and to
    give proper receipts and  acquittances  therefor and Trustee and Beneficiary
    shall have the right and option to apply such excess  towards the payment of
    any sum owing on account of this Deed of Trust and the  Secured  Obligations
    secured thereby,  notwithstanding the fact that such sum may not then be due
    and payable.

             C. The Fixtures and the products and proceeds thereof.

             D. All present and future  leases,  subleases  and licenses and any
    guarantees thereof, rents, issues and profits and additional rents now or at
    any time hereafter covering or affecting all or any portion of the Mortgaged
    Property and all proceeds of, and all privileges and appurtenances belonging
    or in any way appertaining to, the Mortgaged Property,  or any part thereof,
    and all other  property  subjected  or required to be  subjected to the lien
    and/or security  interest of or conveyed  pursuant to the terms of this Deed
    of  Trust,  including,  without  limitation,  all of the  income,  revenues,
    earnings,  rents,  maintenance  payments,  tolls, issues, awards (including,
    without limitation,  condemnation awards and insurance  proceeds),  products
    and profits thereof, which income,  revenues,  earnings,  rents, maintenance
    payments,  tolls, issues, awards,  products and profits are hereby expressly
    assigned  with the  right  to take  and  collect  the  same  upon the  terms
    hereinafter set forth;


<PAGE> 6

    and all the estate, right, title, interest and claim whatsoever,  at law and
    in equity,  which  Trustor  now has or may  hereafter  acquire in and to the
    aforementioned property and every part thereof; provided, that so long as no
    Event of  Default  (as  hereinafter  defined)  shall  have  occurred  and be
    continuing,   all  such  income,  revenues,   earnings,  rents,  maintenance
    payments,  tolls, issues, awards, products and profits shall remain with and
    under the control of Trustor except as otherwise  expressly  provided herein
    or in any other written agreement between Trustor and Beneficiary.

             E.  All  right,  title  and  interest  of  Trustor  in  and  to all
    agreements,  or  contracts,  now or  hereafter  entered  into for the  sale,
    leasing,  brokerage,  development,   construction,  renovation,  management,
    maintenance  and/or  operation  of  the  Premises  (or  any  part  thereof),
    including  all  moneys due and to become due  thereunder,  and all  permits,
    licenses,  bonds, insurance policies,  plans and specifications  relative to
    the construction  and/or  operation of the  Improvements  upon the Mortgaged
    Property.

             F. All right, title and interest  (including,  without  limitation,
    all present and future  rights to  possession  and use,  and all present and
    future  options and other rights to renew and to  purchase)  of Trustor,  as
    lessee  or  sublessee,  under any  leases,  subleases,  licenses,  occupancy
    agreements  or  concessions  now in effect or to be entered  into  hereafter
    (collectively, the "Leasehold Instruments") whereby Trustor has any right to
    the use,  possession  or  occupancy  of the  Premises  or any  part  thereof
    (collectively, the "Leaseholds").

             G. All of  Trustor's  claims and  rights to the  payment of damages
    arising  from any  rejection  of a Leasehold or a Lease under or pursuant to
    the Bankruptcy Code, 11 U.S.C. ss.101 et seq. (the "Bankruptcy Code").

             H. All of Trustor's  rights and remedies at any time arising  under
    or  pursuant  to  Subsection  365(h)  of  the  Bankruptcy  Code,  11  U.S.C.
    ss.365(h),  including, without limitation, all of Trustor's rights to remain
    in possession of the Premises.

             I. Any other  property and rights which are, by the  provisions  of
    the Agreement or any other Loan Document, required to be subject to the lien
    hereof or conveyed pursuant to the terms hereof, and any additional property
    and rights that may from time to time hereafter by installation in or on the
    Mortgaged Property, or by writing of any kind, or otherwise, be subjected to
    the lien hereof by Trustor or by anyone on its behalf.




<PAGE> 7

             J. All proceeds of the conversion, voluntary or involuntary, of any
    of  the  foregoing  into  cash  or  liquidated  claims,  including,  without
    limitation,  proceeds of insurance and condemnation  awards,  and all right,
    title and  interest  of Trustor  in and to all  unearned  premiums  accrued,
    accruing  and to accrue  under any or all  insurance  policies  obtained  by
    Trustor.

             TO HAVE AND TO HOLD the  Mortgaged  Property,  unto Trustee for the
    benefit of  Beneficiary  and its  successors  and  assigns,  upon the terms,
    provisions and conditions herein set forth, forever, and Trustor does hereby
    bind  itself  and its  successors,  legal  representatives,  and  assigns to
    warrant and forever  defend all and singular  the  Mortgaged  Property  unto
    Beneficiary  and Trustee and their  successors  and assigns,  against  every
    person  whomsoever  lawfully  claiming  or to  claim  the  same or any  part
    thereof.

             IN TRUST,  to secure the  payment  and  performance  of the Secured
    Obligations,  whereupon  this Deed of Trust  shall cease and be void and the
    Mortgaged Property shall be released at the cost of Trustor.


                               SECURED OBLIGATIONS

             This Deed of  Trust,  and all  rights,  titles,  interests,  liens,
    security  interests,  powers,  privileges  and  remedies  created  hereby or
    arising  hereunder or by virtue hereof,  are given to secure the payment and
    performance of the all  indebtednesses,  obligations and liabilities arising
    under the  Notes,  the  Agreement,  this  Deed of Trust  and any other  Loan
    Document,  and  any  renewals,   extensions,   amendments,   amendments  and
    restatements,  supplements or  modifications  thereof or thereto,  howsoever
    created,  arising or  evidenced,  whether  direct or  indirect,  absolute or
    contingent,  now or hereafter  existing or due or to become due, and any and
    all fees, costs or expenses  incurred by Beneficiary or Trustee,  including,
    but not limited to,  interest  accruing at the then applicable rate provided
    in the  Agreement  after the maturity of the Loans and interest  accruing at
    the then  applicable  rate  provided in the  Agreement  or other  applicable
    agreement   after  the  filing  of  any  petition  in  bankruptcy,   or  the
    commencement of any insolvency,  reorganization or like proceeding, relating
    to the Trustor on the Loans and on all other  obligations  of the Trustor to
    the Secured  Parties,  taxes,  recording  expenses  and  attorneys'  fees in
    connection  with the  execution and delivery of any of the aforesaid and the
    consummation of the transactions  contemplated  thereby,  the administration
    thereof,  and, after default, the administration and collection thereof, all
    costs incurred of whatever nature by Beneficiary and Trustee in the exercise
    of any rights  hereunder or under any Loan  Document  and all other  amounts
    payable  by  Trustor  under  this  Deed  of  Trust  (all  of  the


<PAGE> 8

    foregoing indebtedness, obligations and liabilities being referred to herein
    as the "Secured Obligations").


                                    ARTICLE I

                     PARTICULAR WARRANTIES, REPRESENTATIONS
                            AND COVENANTS OF TRUSTOR

             Section  1.01  Warranties  and   Representations.   Trustor  hereby
    warrants and represents as follows:

                      (a) Trustor is the actual,  record and beneficial owner of
    the Premises and holder of a good and  marketable  title to an  indefeasible
    leasehold  estate in the  Leaseholds or owns an actual  beneficial  interest
    therein and Fee estate in the rest of the Mortgaged  Property,  subject only
    to such  exceptions to title as are listed in the title policy  insuring the
    lien  of this  Deed of  Trust  and  approved  by  Beneficiary  as  permitted
    exceptions. Trustor is the owner of all of the remaining Mortgaged Property;
    Trustor  will own the  Fixtures  free and clear of liens and  claims  except
    those in favor of  Beneficiary;  and this Deed of Trust is and will remain a
    valid and enforceable  first lien on the Mortgaged  Property subject only to
    the permitted exceptions referred to above.

                      (b) Trustor has full power and lawful authority to convey,
    pledge and  encumber  the  Mortgaged  Property in the manner and form herein
    done or intended hereafter to be done. Trustor will preserve such title, and
    will  forever  warrant  and defend the  validity  and  priority  of the lien
    hereof, against the claims of all persons and parties whomsoever.

                      (c) Except as otherwise  specified in the Title Policy (as
    defined in the  Agreement)  or in the Survey (as defined in the  Agreement),
    the  Premises  is not  located in an area  identified  by the  Secretary  of
    Housing and Urban  Development as an area having special flood hazards or if
    it so located, flood insurance acceptable to Beneficiary has been obtained.

             Section 1.02 Further Assurances. Trustor will, at its sole expense,
    do, execute,  acknowledge  and deliver every further act, deed,  conveyance,
    mortgage,  assignment,  notice  of  assignment,  transfer  or  assurance  as
    Beneficiary  shall  from time to time  reasonably  require,  for the  better
    assuring, conveying, assigning, transferring and confirming unto Beneficiary
    the property and rights hereby  conveyed,  mortgaged or assigned or intended
    now or hereafter so to be, or which Trustor may be or may  hereafter  become
    bound to  convey,  mortgage  or  assign to  Trustee  or  Beneficiary  or for
    carrying out the intention or  facilitating  the performance of the terms of



<PAGE> 9

    this Deed of Trust,  and for filing,  registering  or recording this Deed of
    Trust and,  on demand,  will  execute  and  deliver,  and hereby  authorizes
    Beneficiary  or  Trustee  to execute in the name of Trustor to the extent it
    may lawfully do so, one or more financing  statements,  chattel mortgages or
    comparable  security  instruments,  and renewals  thereof,  to evidence more
    effectively the lien hereof upon the Fixtures.

             Section  1.03  Filings,   Recordings  and  Payments.   (a)  Trustor
    forthwith upon the execution of this Deed of Trust, and thereafter from time
    to time,  will,  at its  expense,  cause this Deed of Trust and any security
    instrument  creating a lien or evidencing  the lien hereof upon the Fixtures
    and each instrument of further assurance to be filed, registered or recorded
    in such  manner  and in such  places as may be  required  by any  present or
    future  law in order to  publish  notice  of and fully to  protect  the lien
    hereof upon, and the interest of Trustee and  Beneficiary  in, the Mortgaged
    Property.

                      (b) Trustor will pay all taxes,  filing,  registration and
    recording   fees,   and  all  expenses   incident  to  the   execution   and
    acknowledgment  of this Deed of Trust, any  supplemental  deed of trust, any
    other  Loan  Document,  and any  security  instrument  with  respect  to the
    Fixtures, and any instrument of further assurance,  and all federal,  state,
    county  and  municipal  stamp  taxes  and  other  taxes,  duties,   imposts,
    assessments  and charges  arising out of or in connection with the execution
    and delivery of the Agreement,  this Deed of Trust, any supplemental deed of
    trust, any other Loan Document,  any security instrument with respect to the
    Fixtures  or  any  instrument  or  further  assurance,  other  than  income,
    franchise or other similar taxes imposed on Beneficiary in respect of income
    derived by Beneficiary under the Secured Obligations.

             Section 1.04 Payment of Sums Due.  Trustor will  punctually pay the
    principal  and  interest  and all other sums to become due in respect of the
    Agreement  and any  other  Loan  Document  at the time and  place and in the
    manner specified in the Agreement and any other Loan Document,  according to
    the true  intent and  meaning  thereof  and  without  offset,  counterclaim,
    defense or cause of action of any kind whatsoever,  and without deduction or
    credit for any amount payable for taxes, all in immediately  available funds
    in Dollars.

             Section 1.05 After Acquired Property. All right, title and interest
    of Trustor in and to all extensions,  improvements,  betterments,  renewals,
    substitutes and replacements of, and all additions and appurtenances to, the
    Mortgaged  Property,  hereafter  acquired  by  or  released  to  Trustor  or
    constructed,  assembled  or  placed  by  Trustor  on the  Premises,  and all
    conversions  of the  security  constituted  thereby,  immediately  upon such
    acquisition, release, construction,  assembling, placement or conversion, as
    the case may be,  and in each  such  case,


<PAGE> 10

    without  any  further  mortgage,  conveyance,  assignment  or  other  act by
    Trustor, shall become subject to the lien of this Deed of Trust as fully and
    completely,  and with the same  effect,  as though now owned by Trustor  and
    specifically  described in the granting  clauses hereof,  but at any and all
    times  Trustor  will  execute  and deliver to  Beneficiary  any and all such
    further assurances,  mortgages,  deeds of trust,  conveyances or assignments
    thereof as Beneficiary may reasonably  require for the purpose of expressing
    and specifically subjecting the same to the lien of this Deed of Trust.

             Section 1.06 Taxes, Fees and Other Charges. (a) Trustor,  from time
    to time when the same shall become due, and prior to the date of  imposition
    of interest or penalty  (except as otherwise  permitted  in the  Agreement),
    will pay and  discharge,  or cause to be paid and  discharged,  all taxes of
    every  kind and  nature  (including  real and  personal  property  taxes and
    income, franchise,  withholding,  transfer or recordation taxes, profits and
    gross receipt taxes), all general and special assessments,  levies, permits,
    inspection and license fees, all water and sewer rents and charges,  and all
    other public charges, whether of a like or different nature, imposed upon or
    assessed  against it or the  Mortgaged  Property or any part thereof or upon
    the revenues,  rents, issues,  income and profits of the Premises or arising
    in respect of the occupancy, use or possession thereof. Trustor will, at any
    time upon request by Beneficiary,  promptly deliver to Beneficiary  receipts
    evidencing the payment of same.

             Upon the  occurrence  of an Event of Default  under the  Agreement,
    Beneficiary  may, at any time and from time to time,  at its  option,  to be
    exercised  by written  notice to Trustor,  require the deposit by Trustor at
    the time of each payment of an  installment  of interest or principal  under
    the  Agreement  of  an  additional   amount   sufficient  to  discharge  the
    obligations   under  this   subsection   (a)  when  they  become  due.   The
    determination of the amount so payable and of the fractional part thereof to
    be deposited with  Beneficiary,  so that the aggregate of such deposit shall
    be sufficient  for this purpose,  shall be made by  Beneficiary  in its sole
    discretion. Such amounts shall be held by Beneficiary without interest in an
    account  acceptable  to  Beneficiary  and  applied  to  the  payment  of the
    obligations  in respect  to which such  amounts  were  deposited  or, at the
    option of Beneficiary  and subject to applicable  law, to the payment of the
    Secured Obligations in such order or priority as Beneficiary shall determine
    consistent  with the Agreement,  on or before the respective  dates on which
    the same or any of them would become  delinquent.  If one month prior to the
    due date of any of the  obligations  under this  subsection  (a) the amounts
    then on  deposit  therefor  shall be  insufficient  for the  payment of such
    obligations in full, Trustor within ten (10) days after demand shall deposit
    the amount of the



<PAGE> 11

    deficiency  with  Beneficiary.  Nothing herein  contained shall be deemed to
    affect any right or remedy of Beneficiary  under the provisions of this Deed
    of Trust or of any  statute or rule of law to pay any such amount and to add
    the  amount  so paid  together  with  interest  at the  Default  Rate to the
    indebtedness hereby secured.

                      (b)  Except  as  otherwise  permitted  in  the  Agreement,
    Trustor  will pay,  from time to time when the same shall  become  due,  all
    lawful claims and demands of mechanics,  materialmen,  laborers,  and others
    which, if unpaid,  might result in, or permit the creation of, a lien on the
    Mortgaged Property or any part thereof, or on the revenues,  rents,  issues,
    income and profits  arising  therefrom and in general will do or cause to be
    done everything  necessary so that the lien hereof shall be fully preserved,
    at the cost of Trustor, without expense to Beneficiary.

             Section 1.07     Intentionally Deleted.

             Section 1.08 Insurance. (a) Trustor agrees to at all times provide,
    maintain  and  keep in force  the  policies  of  insurance  required  to the
    maintained pursuant to the terms of the Agreement.

                      (b) In the event Trustor fails to provide,  maintain, keep
    in force or deliver and furnish to  Beneficiary  the  policies of  insurance
    required by the  Agreement  or this Deed of Trust,  Beneficiary  may procure
    such  insurance  or  single-interest   insurance  for  such  risks  covering
    Beneficiary's  interest,  and Trustor will pay all premiums thereon promptly
    upon demand by  Beneficiary,  and until such  payment is made by Trustor the
    amount of all such premiums,  together with interest  thereon at the Default
    Rate shall be secured by this Deed of Trust.

                      (c) After the  happening of any casualty to the  Mortgaged
    Property  or any part  thereof,  Trustor  shall give prompt  written  notice
    thereof to  Beneficiary,  and Beneficiary may make proof of loss if not made
    promptly by Trustor.  In the event of such loss or damage,  all  proceeds of
    insurance  shall be  payable in the manner  provided  for in the  Agreement.
    Unless otherwise  provided in the Agreement,  nothing herein contained shall
    be deemed to excuse Trustor from  repairing or  maintaining  the Premises as
    provided in Section 1.12 hereof or restoring  all damage or  destruction  to
    the  Mortgaged  Property,  regardless  of whether or not there are insurance
    proceeds  available or whether any such  proceeds are  sufficient in amount,
    and the  application  or release by  Beneficiary  of any insurance  proceeds
    shall not cure or waive any default or notice of default  under this Deed of
    Trust or  invalidate  any act  done  pursuant  to such  notice.  Any  monies
    received as payment for loss under any insurance  shall be applied  pursuant
    to the terms of the


<PAGE> 12

    Agreement.

                      (d) In the event of  foreclosure  of this Deed of Trust or
    other transfer of title or assignment of the Premises in extinguishment,  in
    whole or in part, of the debt secured hereby,  all right, title and interest
    of Trustor in and to all policies of insurance required by this Section 1.08
    shall  inure to the  benefit of and pass to the  successor  in  interest  to
    Trustor or the purchaser or grantee of the Premises.

                      (e)  Beneficiary  may at any time following the occurrence
    of an Event of Default under the Agreement,  at its option,  to be exercised
    by written notice to Trustor, require the deposit by Trustor, at the time of
    each payment of an installment of interest or principal under the Agreement,
    of an additional  amount  sufficient to discharge the obligations under this
    Section  1.08 when they  become  due.  The  determination  of the  amount so
    payable and of the fractional part thereof to be deposited with  Beneficiary
    with  each  installment,  so that the  aggregate  of such  deposit  shall be
    sufficient  for  this  purpose,  shall  be made by  Beneficiary  in its sole
    discretion. Such amounts shall be held by Beneficiary without interest in an
    account  acceptable  to  Beneficiary  and  applied  to  the  payment  of the
    obligations in respect of which such amounts were deposited on or before the
    respective  dates on which the same or any of them would  become  delinquent
    or, at the option of Beneficiary,  to the payment of the Secured Obligations
    in such order or priority as Beneficiary shall determine consistent with the
    Agreement.  If one month prior to the due date of any of the  aforementioned
    obligations the amounts then on deposit  therefor shall be insufficient  for
    the payment of such obligations in full,  Trustor within five (5) days after
    demand shall deposit the amount of the deficiency with Beneficiary.  Nothing
    herein  contained  shall  be  deemed  to  affect  any  right  or  remedy  of
    Beneficiary  under the provisions of this Deed of Trust or of any statute or
    rule of law to pay any such  amount and to add the  amount so paid  together
    with interest at the Default Rate to the indebtedness hereby secured.

             Section 1.09 Condemnation.  (a) In the event the Mortgaged Property
    or any part  thereof  or  interest  therein,  shall be taken or  damaged  by
    eminent domain,  alteration of the grade of any street, or there shall occur
    any other injury to or decrease in the value of the Mortgaged  Property,  by
    reason of any public or quasi-public improvement or condemnation proceeding,
    or in any other similar manner  ("Condemnation"),  or should Trustor receive
    any notice or other  information  regarding such  Condemnation or a proposed
    Condemnation,   Trustor  shall  give  prompt   written   notice  thereof  to
    Beneficiary.

                      (b) All compensation,  awards and other payments or


<PAGE> 13

    relief payable as a result of any such Condemnation, shall be payable in the
    manner  provided  for in  the  Agreement.  All  such  compensation,  awards,
    damages,  rights of action and proceeds  awarded to Trustor (the "Proceeds")
    are hereby  assigned  to  Beneficiary  and  Trustor  agrees to execute  such
    further assignments of the Proceeds as Beneficiary may require.  Beneficiary
    shall be under no  obligation  to  question  the amount of any such award or
    compensation and may accept the same in the amount paid. All Proceeds may be
    applied either against the Secured  Obligations  (in such order and priority
    as Beneficiary shall determine  consistent with the Agreement) or to restore
    the Premises,  at the discretion of Beneficiary,  except as may be otherwise
    provided in the Agreement.

                      (c) Unless  otherwise  provided in the Agreement,  nothing
    herein  contained  shall be deemed  to  excuse  Trustor  from  repairing  or
    maintaining the Premises as provided in Section 1.12 hereof or restoring all
    damage or  destruction to the Mortgaged  Property,  regardless of whether or
    not there are proceeds available or whether any such Proceeds are sufficient
    in amount,  and the  application  or release by  Beneficiary of any Proceeds
    shall not cure or waive any default or notice of default  under this Deed of
    Trust or invalidate any act done pursuant to such notice.

                      (d) Receipt by Beneficiary and application in reduction of
    indebtedness  of any  Proceeds  less  than  the  full  amount  of  the  then
    outstanding  Secured  Obligations shall not defer, alter or modify Trustor's
    obligation  to  continue  to pay  the  regular  installments  of  principal,
    interest on the outstanding principal balance and other charges specified in
    the Secured Obligations and herein.

                      (e) If prior to the receipt of the Proceeds by Beneficiary
    the condemned  Premises  shall have been sold on foreclosure of this Deed of
    Trust,  Beneficiary  shall,  nevertheless,  have the  right to  receive  the
    Proceeds  and to retain,  for its own  account,  (i) an amount  equal to the
    counsel fees, costs and disbursements  incurred by Beneficiary in connection
    with  collection of the Proceeds and not repaid by Trustor and (ii) the full
    amount of all such Proceeds,  if Beneficiary is the successful  purchaser at
    the  foreclosure  sale,  to the  extent of amounts  owed  under the  Secured
    Obligations or hereunder.

             Section 1.10 Beneficiary's Performance of Trustor's Obligations. If
    Trustor shall fail to perform any of the covenants  contained  herein or any
    covenant contained in the Agreement or any other Loan Document,  Beneficiary
    may, but shall not be obligated to, make advances  and/or  disbursements  to
    perform the same.  Trustor will repay on demand all sums so advanced  and/or
    disbursed  with  interest at the  Default  Rate from the date of making such
    advance and/or disbursement until such sums have been repaid and all sums so
    advanced  and/or


<PAGE> 14

    disbursed,  together with interest  thereon at the Default Rate,  shall be a
    lien upon the Mortgaged Property and shall be secured hereby. The provisions
    of this Section 1.10 shall not prevent any default in the  observance of any
    covenant  contained  herein or in the Secured  Obligations or any other Loan
    Document from constituting an Event of Default.

             Section 1.11 Financial Records.  Trustor will provide the financial
    statements to Beneficiary required pursuant to the terms of the Agreement.

             Section  1.12 Waste and  Maintenance.  Trustor  will not  threaten,
    commit,  permit or suffer any waste to occur on or to the Mortgaged Property
    or any part thereof or alter or demolish the Mortgaged  Property or any part
    thereof in any manner or make any change in its use  (except as  provided in
    the  Agreement)  or any change  which will in any way  increase  any fire or
    other  hazards  arising out of  construction  or operation of the  Mortgaged
    Property.  Trustor  will, at all times,  maintain the Mortgaged  Property as
    required pursuant to the terms of the Agreement.

             Section 1.13 Enforcement  Expenses.  Except where inconsistent with
    the laws of the state in which the  Mortgaged  Property is located,  Trustor
    agrees that if any action or proceeding be commenced, including an action to
    foreclose this Deed of Trust or to collect the indebtedness  hereby secured,
    to which action or proceeding  Beneficiary  is made a party by reason of the
    execution of this Deed of Trust or the Secured Obligations which it secures,
    or in which it becomes  necessary  to defend or uphold the lien of this Deed
    of Trust,  all sums paid by Beneficiary for the expense of any litigation to
    prosecute or defend the  transaction and the rights and liens created hereby
    (including  reasonable  attorneys'  fees) shall be paid by Trustor  together
    with  interest  thereon from date of payment by  Beneficiary  at the Default
    Rate. All such sums paid and the interest  thereon shall be immediately  due
    and  payable,  shall be a lien  upon the  Mortgaged  Property,  and shall be
    secured  hereby  as shall be all  such  sums  incurred  in  connection  with
    enforcement by  Beneficiary of its rights  hereunder or under any other Loan
    Document.

             Section 1.14 Defense of Beneficiary's Interests. If the interest of
    Beneficiary  in the  Mortgaged  Property or any part  thereof or the lien or
    security interest of this Deed of Trust thereon shall be attacked,  directly
    or indirectly,  or if legal proceedings shall be instituted against Trustee,
    Trustor or Beneficiary with respect thereto or against Trustor, Trustor upon
    its  learning  thereof,   will  promptly  give  written  notice  thereof  to
    Beneficiary  and Trustor will, at Trustor's  cost and expense,  exert itself
    diligently  to cure,  or will cause to be



<PAGE> 15

    cured,  any defect that may have developed or be claimed to exist,  and will
    take all necessary and proper steps for the protection  and defense  thereof
    and will take, or will cause to be taken,  such action as is  appropriate to
    the defense of any such legal  proceedings,  including,  but not limited to,
    the employment of counsel and the prosecution and defense of litigation.

             Section 1.15 No Impairment  of Security.  In no event shall Trustor
    do or permit to be done, or omit to do or permit the omission of, any act or
    thing, the doing, or omission, of which would materially impair the security
    of this  Deed of Trust  or  materially  impair  the  value of the  Mortgaged
    Property or any part thereof.

             Section  1.16  Restrictions  on  Transfers  and  Mortgages.  Unless
    otherwise permitted pursuant to the terms of the Agreement, Trustor will not
    directly or indirectly,  by transfer,  mortgage,  conveyance,  or sale of an
    interest in Trustor permit,  do or suffer the assignment,  lease,  transfer,
    sale,  conveyance  or  encumbrance  of the Mortgaged  Property,  or any part
    thereof or any interest  therein,  without the express prior written consent
    of  Beneficiary  unless  otherwise  permitted  pursuant  to the terms of the
    Agreement.  While the  Secured  Obligations  are  outstanding,  neither  the
    structure  nor the  ownership of Trustor may be changed  without the express
    prior written consent of Beneficiary unless otherwise  permitted pursuant to
    the terms of the Agreement.

             Section  1.17  Beneficiary's  Defense.  Beneficiary  or Trustee may
    appear in and  defend  any  action or  proceeding  at law or in equity or in
    bankruptcy  purporting to affect the Premises or the security  hereof or the
    rights and powers of Beneficiary or Trustee, and any appellate  proceedings,
    and in such  event  Trustor  shall pay all of  Beneficiary's  and  Trustee's
    costs,  charges  and  expenses,  including  cost of  evidence  of title  and
    attorneys'  fees incurred in such action or proceeding.  All costs,  charges
    and expenses so incurred, together with interest thereon at the Default Rate
    from the date of payment  of same by  Beneficiary  or Trustee as  aforesaid,
    shall be  secured  by the lien of this  Deed of Trust  and  shall be due and
    payable upon demand.

             Section  1.18  Environmental  Compliance.  Trustor will perform and
    comply  promptly  with,  and cause the Premises to be  maintained,  used and
    operated in accordance  with, all applicable  federal,  state and local laws
    pertaining to air and water quality,  hazardous waste,  waste disposal,  air
    emissions and other environmental matters, as set forth in the Agreement.

             Section 1.19 Zoning Changes.  Trustor will not consent to, join in,
    permit or allow any change in the zoning laws or



<PAGE> 16

    ordinances  relating to or affecting the Premises which could  reasonably be
    expected to  materially  adversely  affect the  Premises  and will  promptly
    notify Beneficiary of any changes to the zoning laws.

             Section  1.20  Grant of  Security  Interest.  Trustor,  as  further
    security  for the  payment of said  indebtedness  and in addition to all the
    rights and remedies otherwise available to Beneficiary or Trustee under this
    Deed of Trust and the  other  Loan  Documents,  grants  to  Beneficiary  and
    Trustee a security interest,  under the Uniform Commercial Code as in effect
    in the state where all or any of the  Fixtures  are  located,  in and to the
    Fixtures,  and all proceeds thereof.  Upon an Event of Default,  Beneficiary
    and Trustee  shall have,  in addition to all the other  rights and  remedies
    allowed by law, the rights and remedies of a secured party under the Uniform
    Commercial  Code as in effect at that time.  Trustor further agrees that the
    security  interest  created  hereby also secures all expenses of Beneficiary
    and Trustee (including reasonable expenses for legal services of every kind,
    and cost of any insurance,  and payment of taxes or other charges)  incurred
    in  or  incidental  to,  the  custody,  care,  sale  or  collection  of,  or
    realization  upon, any of the property secured hereby or in any way relating
    to the  enforcement  or protection of the rights of  Beneficiary  or Trustee
    hereunder, together with interest thereon at the Default Rate until paid.

             Section 1.21 Compliance with Laws and ADA Compliance.

                      (a) Trustor  warrants and covenants  that the Premises are
    and will  continue to be  substantially  in compliance  with all  applicable
    local,  county,  state and federal laws and  regulations  and all  building,
    housing and fire codes, rules and regulations.

                      (b) Without  limiting the  provisions of subsection (a) of
    this Section 1.25: (i) Trustor  represents and warrants to Beneficiary  that
    Trustor is substantially in compliance with the Americans with  Disabilities
    Act of 1990 (42 U.S.C.A.  sec.  12101 et. seq.),  as the same may be amended
    from time to time (the  "ADA") and all other  federal,  state and local laws
    pertaining to the accessibility of the Premises by persons with disabilities
    (the ADA and such other laws are,  collectively,  the "Accessibility Laws");
    (ii)  Trustor  covenants  to  ensure  that the  Premises  will at all  times
    substantially  comply with all applicable  Accessibility  Laws and, upon the
    request of Beneficiary, Trustor will conduct such surveys of the Premises as
    Beneficiary  shall require to ascertain such compliance;  (iii) Trustor will
    maintain  accurate records of all  expenditures  made in connection with any
    alterations  to the Premises and will deliver  copies thereof to Beneficiary
    upon



<PAGE> 17

    Beneficiary's  request;  and (iv) Trustor shall  defend,  indemnify and hold
    harmless Beneficiary, its employees, agents, officers and directors, and any
    parent or affiliate of  Beneficiary,  from and against any claims,  demands,
    penalties,  fines,  liabilities,  settlements,  damages, cost or expenses of
    whatever kind or nature, known or unknown, contingent or otherwise,  arising
    out or in any  way  related  to any  violations  of the  Accessibility  Laws
    (including,  without  limitation,  any  costs  incurred  by  Beneficiary  in
    complying with any Accessibility  Laws). Neither payment of the indebtedness
    secured  hereby nor  foreclosure  shall  operate as a discharge of Trustor's
    obligations  under this  subsection (b). In the event Trustor tenders a deed
    in lieu of  foreclosure,  Trustor shall deliver the Premises to  Beneficiary
    (or its designee)  substantially free of any violations of the Accessibility
    Laws.  In the  event  Trustor  does  not  timely  perform  any of the  above
    obligations,  Beneficiary  after 30 days notice to Trustor may perform  said
    obligations at the expense of Trustor and Trustor shall, upon written demand
    from Beneficiary,  reimburse Beneficiary for all costs, including attorney's
    fees and out-of-pocket expenses, and all liabilities incurred by Beneficiary
    by reason of the foregoing,  with interest  thereon at the Default Rate from
    the date of such  payment by  Beneficiary  to the date of  repayment.  Until
    paid, said costs and expenses shall be secured by this Deed of Trust.

             Section 1.22 Other Multistate  Mortgages.  The indebtedness secured
    in part by this Deed of Trust is secured by mortgages  and/or deeds of trust
    encumbering  and  conveying  lands  and  other  property  and/or   leasehold
    interests  therein in other  states as more  particularly  described  in the
    Agreement,  all of which  mortgages  and/or deeds of trust,  including  this
    instrument, being hereafter referred to as "the mortgage instruments."

             It is understood and agreed that all of the properties of all kinds
    conveyed or  encumbered  by the  mortgage  instruments  are security for the
    Secured  Obligations without allocation of any one or more of the parcels or
    portions  thereof to any  portion of the Secured  Obligations  less than the
    whole amount thereof unless so stated in said mortgage instruments.

             It is  specifically  covenanted  and  agreed  that  Beneficiary  or
    Trustee may proceed,  at the same or at different  times,  to foreclose said
    mortgage instruments,  or any of them, by any proceedings appropriate in the
    state where any of the land lies,  and that no event of  enforcement  taking
    place  in any  state  including,  without  limiting  the  generality  of the
    foregoing,  any pending foreclosure,  judgment or decree of the foreclosure,
    foreclosure sale, rents received,  possession taken,  deficiency judgment or
    decree, or judgment taken on the Secured Obligations, shall in any way stay,
    preclude or bar  enforcement  of the mortgage  instruments or any of them in
    any



<PAGE> 18

    other  state,  and that  Beneficiary  or  Trustee  may pursue any or all its
    remedies  to the  maximum  extent  permitted  by state  law until all of the
    Secured  Obligations now or hereafter  secured by any or all of the mortgage
    instruments has been paid and discharged in full.

             Neither Trustor, nor any person claiming under Trustor,  shall have
    or enjoy any right to  marshalling  of assets,  all such right being  hereby
    expressly  waived as to Trustor and all persons claiming under it, including
    junior lienors.  No release of personal liability of any person whatever and
    no release of any portion of the property  now or  hereafter  subject to the
    lien of any of the mortgage  instruments  shall have any effect  whatever by
    way of  impairment  or  disturbance  of the lien or  priority of any of said
    mortgage instruments. Any foreclosure or other appropriate remedy brought in
    any of the states  aforesaid may be brought and prosecuted as to any part of
    the mortgaged  security,  wherever located,  without regard to the fact that
    foreclosure  proceedings or other appropriate remedies have or have not been
    instituted  elsewhere on any other land subject to the lien of said mortgage
    instruments or any of them.

             Section 1.23  Leasehold and Leasehold Instruments.

                      (a) Trustor covenants and agrees to faithfully comply with
    and perform all of its  obligations  under the Leasehold  Instruments and to
    promptly cure any default by it under the Leasehold Instruments.

                      (b) Trustor may modify,  amend or terminate  any Leasehold
    Instrument  without  the  prior  written  consent  provided  such  action is
    consistent with the terms of the Agreement.

                      (c) Trustor will promptly  give  Beneficiary a copy of any
    default notice given to Trustor with respect to any Leasehold Instrument.


                                   ARTICLE II

                         EVENTS OF DEFAULT AND REMEDIES

             Section  2.01 Events of Default.  The  following  shall  constitute
    defaults  hereunder and, after the giving of notice and the passage of time,
    if any, as provided herein, shall constitute "Events of Default" hereunder:

                       (a) if  Trustor  shall  fail to pay when due any  Secured
    Obligation  after the passage of any applicable  notice or



<PAGE> 19

    grace period, if any; or

                       (b) If an Event of Default,  as defined in the Agreement,
    shall occur under the Agreement.

             Section 2.02 Beneficiary's  Remedies. (a) During the continuance of
    any Event of Default,  Beneficiary,  without notice or presentment,  each of
    which are hereby waived by Trustor,  may,  subject to the  provisions of the
    Agreement,  declare the entire  principal  of the Secured  Obligations  then
    outstanding  and all  accrued  and  unpaid  interest  thereon  and all other
    amounts  owing in respect  thereof (if not then due and payable,  whether by
    acceleration or otherwise), to be due and payable immediately,  and upon any
    such  declaration the principal of the Secured  Obligations and said accrued
    and  unpaid  interest  shall  become  and be  immediately  due and  payable,
    anything in the  instruments  evidencing the Secured  Obligations or in this
    Deed of Trust to the contrary notwithstanding;

                      (b)  During  the  continuance  of any  Event  of  Default,
    Beneficiary  or  Trustee  may  enter  into  and  upon all or any part of the
    Premises,  and,  having and holding the same, may use,  operate,  manage and
    control the Mortgaged  Property or any part thereof and conduct the business
    thereof,  either  personally or by its  superintendents,  managers,  agents,
    servants,  attorneys or receivers;  and likewise,  from time to time, at the
    expense of Trustor,  Beneficiary  and/or  Trustee may make all  necessary or
    proper  repairs,  renewals  and  replacements  and such useful  alterations,
    additions,  betterments  and  improvements  thereto and thereon as to it may
    deem  advisable  in its sole  judgment;  and in every such case  Beneficiary
    and/or  Trustee  shall have the right to manage and  operate  the  Mortgaged
    Property  and to carry on the  business  thereof and exercise all rights and
    powers of  Trustor  with  respect  thereto  either in the name of Trustor or
    otherwise as  Beneficiary  or Trustee shall deem best;  and  Beneficiary  or
    Trustee  shall  be  entitled,  with or  without  entering  into or upon  the
    Premises,  to collect and receive all gross  receipts,  earnings,  revenues,
    rents,  maintenance  payments,  issues,  profits and income of the Mortgaged
    Property  and  every  part  thereof,  all of which  shall  for all  purposes
    constitute  property of  Beneficiary;  and, after  deducting the expenses of
    conducting the business thereof and of all maintenance,  repairs,  renewals,
    replacement,   alterations,  additions,  betterments  and  improvements  and
    amounts  necessary to pay taxes,  assessments,  insurance and prior or other
    proper charges upon the Mortgaged  Property or any part thereof,  as well as
    just and  reasonable  compensation  for the services of  Beneficiary  and/or
    Trustee and for all attorneys,  counsel,  agents, clerks, servants and other
    employees by it properly  engaged and  employed,  Beneficiary  may apply the
    moneys  arising as aforesaid in such manner and at such times as Beneficiary
    shall  determine  in its  discretion  consistent  with the  Agreement to the
    payment of the Secured Obligations and the interest



<PAGE> 20

    thereon,  when and as the same shall become payable and/or to the payment of
    any other sums required to be paid by Trustor under this Deed of Trust;

                      (c) During the  continuance  of any such Event of Default,
    Trustor covenants and agrees as follows:

                      (1) Trustee or  Beneficiary  may,  with or without  entry,
             personally or by their agents or attorneys,  insofar as applicable,
             sell the Mortgaged Property or any part thereof and pursuant to the
             procedures provided by law, and all estate, right, title, interest,
             claim and demand therein,  and right of redemption  thereof, at one
             or more  sales as an  entity  or in  parcels,  and at such time and
             place  upon such  terms and after  such  notice  thereof  as may be
             required or permitted by law; or

                      (2)  Trustee or  Beneficiary  may  institute  an action of
             mortgage  foreclosure or institute other  proceedings  according to
             law for the  foreclosure  hereof,  and may  prosecute  the  same to
             judgment,  execution  and sale for the  collection  of the  Secured
             Obligations  secured hereby, and all interest with respect thereto,
             together  with  all  taxes  and  insurance   premiums  advanced  by
             Beneficiary or Trustee and other sums payable by Trustor hereunder,
             and all fees,  costs and  expenses of such  proceedings,  including
             attorneys' fees and expenses; or

                      (3) Trustee or Beneficiary  may, if default be made in the
             payment  of any  part  of the  Secured  Obligations,  proceed  with
             foreclosure of the liens  evidenced  hereby in satisfaction of such
             item either  through the courts or by conducting the sale as herein
             provided,  and proceed with  foreclosure  of the security  interest
             created  hereby,  all  without  declaring  the whole of the Secured
             Obligations  due,  and  provided  that  if  sale  of the  Mortgaged
             Property,  or any portion  thereof,  is made  because of default in
             payment of a part of the Secured Obligations, such sale may be made
             subject to the unmatured part of the Secured Obligations, but as to
             such  unmatured part of the Secured  Obligations  (and it is agreed
             that such  sale,  if so made,  shall not in any  manner  affect the
             unmatured part of the Secured Obligations) this Deed of Trust shall
             remain  in full  force and  effect  just as though no sale had been
             made  under the  provisions  of this  paragraph.  And it is further
             agreed that several sales may be



<PAGE> 21

              made  hereunder  without  exhausting  the  right  of sale  for any
              unmatured part of the Secured Obligations, it being the purpose to
              provide for a foreclosure and sale of the Mortgaged  Property,  or
              any  part  thereof,   for  any  matured  portion  of  the  Secured
              Obligations  without exhausting the power to foreclose and to sell
              the Mortgaged Property, or any part thereof, for any other part of
              the   Secured   Obligations   whether   matured  at  the  time  or
              subsequently maturing; or

                      (4) Trustee or Beneficiary  may take such steps to protect
             and enforce its rights  whether by action,  suit or  proceeding  in
             equity  or at law for the  specific  performance  of any  covenant,
             condition  or  agreement  in the  Loan  Documents  or in aid of the
             execution  of any  power  herein  granted,  or for any  foreclosure
             hereunder, or for the enforcement of any other appropriate legal or
             equitable  remedy or  otherwise  as  Beneficiary  or Trustee  shall
             elect; or

                      (5)  Beneficiary or Trustee may exercise in respect of the
             Mortgaged  Property  consisting of Fixtures,  all of the rights and
             remedies  available  to a  secured  party  upon  default  under the
             applicable  provisions of the Uniform  Commercial Code in effect in
             the state where the Mortgaged Property is located; or

                      (6)  Beneficiary  or  Trustee  may apply any  proceeds  or
             amounts held in escrow  pursuant to the terms of this Deed of Trust
             to payment of any part of the Secured  Obligations in such order of
             priority  as  Beneficiary   may  determine   consistent   with  the
             Agreement; or

                      (7) Any sale as aforesaid  may be subject to such existing
             tenancies as Beneficiary, in its sole discretion, may elect.


             Section 2.03 Sale, Foreclosure, etc. (a) Beneficiary or Trustee may
    adjourn  from  time to time any sale by it to be made  under or by virtue of
    this Deed of Trust by  announcement at the time and place appointed for such
    sale or for such adjourned sale or sales; and, except as otherwise  provided
    by any applicable provision of law, Beneficiary or Trustee,  without further
    notice or publication, may make such sale at the time and place to which the
    same shall be so adjourned.

                      (b) Upon  the  completion  of any  sale or  sales  made by
    Beneficiary or Trustee under or by virtue of this Article II, Beneficiary or
    Trustee,  or any officer of any court  empowered



<PAGE> 22

    to do so, shall execute and deliver to the accepted  purchaser or purchasers
    a good  and  sufficient  instrument,  or good  and  sufficient  instruments,
    conveying,  assigning and transferring all estate, right, title and interest
    in and to the properties, interests and rights sold. Beneficiary and Trustee
    are each  hereby  irrevocably  appointed  the true and  lawful  attorney  of
    Trustor,  in its name and  stead,  to make  all the  necessary  conveyances,
    assignments,  transfers and deliveries of any part of the Mortgaged Property
    and rights so sold, and for that purpose  Beneficiary or Trustee may execute
    all necessary  instruments  of  conveyance,  assignment and transfer and may
    substitute one or more persons with like power, Trustor hereby ratifying and
    confirming  all that its said  attorney or such  substitute  or  substitutes
    shall lawfully do by virtue hereof.  Nevertheless,  Trustor, if so requested
    by Beneficiary  or Trustee,  shall ratify and confirm any such sale or sales
    by executing and  delivering to  Beneficiary or Trustee or to such purchaser
    or purchasers all such  instruments  as may be advisable,  in the reasonable
    judgment of Beneficiary or Trustee, for the purpose and as may be designated
    in such request.

                      (c) Upon any sale,  whether under the power of sale hereby
    given or by virtue of judicial  proceedings,  it shall not be necessary  for
    Beneficiary  or Trustee,  or any public  officer  acting under  execution or
    order of court,  to have present or  constructive  possession  of any of the
    Mortgaged Property.

                      (d)  The  recitals  contained  in any  conveyance  made by
    Beneficiary or Trustee to any purchaser at any sale made pursuant  hereto or
    under  applicable law shall be full evidence of the matters  therein stated,
    and all  prerequisites to such sale shall be presumed to have been satisfied
    and performed.

                      (e) Any such sale or sales made under or by virtue of this
    Deed of Trust, whether under the power of sale hereby granted and conferred,
    or under or by virtue of any judicial  proceedings,  shall operate to divest
    all right, title, interest, claim and demand whatsoever, either by law or in
    equity,  of Trustor in and to the premises and property sold, and shall be a
    perpetual bar, both at law and in equity,  against  Trustor,  its successors
    and  assigns,  and  against any and all  persons or  entities  claiming  the
    premises  and  property  sold,  or any part  thereof,  from through or under
    Trustor and its successors or assigns.

                      (f) The receipt  given by  Beneficiary  or Trustee for the
    purchase  money paid at any such  sale,  or the  receipt  given by any other
    person  authorized  to  receive  the  same,  shall be  sufficient  discharge
    therefor to any  purchaser of the  property,  or any part  thereof,  sold as
    aforesaid,  and no  such  purchaser,  or his  representatives,  grantees  or
    assigns,  after paying such



<PAGE> 23

    purchase money and receiving such receipt,  shall be bound (i) to see to the
    application of such purchase money or any part thereof upon or for any trust
    or  purpose  of  this  Deed  of  Trust,   (ii)  by  the   misapplication  or
    nonapplication of any such purchase money, or any part thereof,  or (iii) to
    inquire as to the authorization,  necessity, expediency or regularity of any
    such sale.

                      (g) In case the liens or security interests hereunder,  or
    by the  exercise  of any  other  right  or  power,  shall be  foreclosed  by
    Beneficiary's or Trustee's sale or by other judicial or non-judicial action,
    the  purchaser  at any  such  sale  shall  receive,  as an  incident  to its
    ownership, immediate possession of the property purchased, and if Trustor or
    Trustor's  successors  shall hold  possession of said property,  or any part
    thereof, subsequent to foreclosure, Trustor or Trustor's successors shall be
    considered as tenants at sufferance  of the purchaser at  foreclosure  sale,
    and anyone  occupying the property after demand made for possession  thereof
    shall be guilty of forcible  detainer  and shall be subject to eviction  and
    removal,  forcible or  otherwise,  with or without  process of law,  and all
    damages by reason thereof are hereby expressly waived.

                      (h)  In  the  event  a  foreclosure   hereunder  shall  be
    commenced by Beneficiary or Trustee,  Beneficiary or Trustee may at any time
    before  the sale  abandon  the  suit,  and may then  institute  suit for the
    collection of the Secured  Obligations  and for the foreclosure of the liens
    and security  interest hereof.  If Beneficiary or Trustee should institute a
    suit for the collection of the Secured  Obligations and for a foreclosure of
    the liens and security  interest hereof, it may at any time before the entry
    of a final  judgment  in said suit  dismiss the same and proceed to sell the
    Mortgaged  Property,  or any part thereof,  in accordance with provisions of
    this Deed of Trust.

                      (i) Any  reasonable  expenses  incurred by  Beneficiary or
    Trustee in prosecuting, resetting or settling the claim of Beneficiary shall
    become an additional Secured Obligation of Trustor hereunder.

                      (j) In the  event of any sale  made  under or by virtue of
    this  Article II  (whether  made under the power of sale  herein  granted or
    under or by virtue of  judicial  proceedings  or of a judgment  or decree of
    foreclosure and sale), the entire principal of, and interest on, the Secured
    Obligations,  if not previously due and payable, and all other sums required
    to be paid by Trustor pursuant to this Deed of Trust,  immediately thereupon
    shall,  anything in the Secured  Obligations or in this Deed of Trust to the
    contrary notwithstanding, become due and payable.

                      (k) The purchase money proceeds or avails of any



<PAGE> 24

    sale made under or by virtue of this  Article  II,  together  with any other
    sums which then may be held by Beneficiary under this Deed of Trust, whether
    under the  provisions of this Article II or  otherwise,  shall be applied in
    accordance  with the laws of the  state  where  the  Mortgaged  Property  is
    located,  and to the extent not  inconsistent,  first to the  payment of the
    costs and  expenses  of such  sale,  including  reasonable  compensation  to
    Beneficiary  or Trustee and their agents and counsel,  second to the payment
    of the amounts due and owing under or in respect of the Secured  Obligations
    for  principal  and  interest  and  any  other  amounts  including  (without
    limitation)  any other sums  required to be paid by Trustor  pursuant to any
    provision of this Deed of Trust or any other Loan Document, with interest at
    the Default Rate from and after the happening of any Event of Default in the
    order set forth in Section 9.2(a) of the Agreement, all with interest at the
    Default  Rate from the date such sums were or are  required to be paid under
    this Deed of Trust,  and third to the  payment of the  surplus,  if any,  to
    whomsoever may be lawfully entitled to receive the same.

                      (l) Upon any sale made under or by virtue of this  Article
    II,  whether  made  under the power of sale  herein  granted  or under or by
    virtue of judicial proceedings or of a judgment or decree of foreclosure and
    sale,  Beneficiary  and any other  Secured  Party or Trustee may bid for and
    acquire the Mortgaged  Property or any part thereof and  Beneficiary and any
    other  Secured Party (other than the  Merchandise  Letter of Credit Bank, as
    that term is defined in the  Agreement)  in lieu of paying cash therefor may
    make  settlement  for the  purchase  price by  crediting  some or all of the
    indebtedness  of Trustor secured by this Deed of Trust owing to such Secured
    Party (or, in the case of Beneficiary, owing to all Secured Parties) the net
    sales price after deducting therefrom the expenses of the sale and the costs
    of the action and any other sums which  Beneficiary or Trustee is authorized
    to deduct under this Deed of Trust.

                      Section 2.04 Payments, Judgment, etc. (a) In case an Event
    of Default  under the  Agreement  and the  acceleration  of the  obligations
    thereunder  shall have  occurred,  then Trustor will in accordance  with the
    Agreement pay to  Beneficiary  the whole amount which then shall have become
    due and  payable on the  Secured  Obligations,  whether  for  principal  and
    interest or both or otherwise, as the case may be, which interest shall then
    accrue at the Default Rate on the then unpaid  principal of or other amounts
    constituting the Secured  Obligations,  and the sums re quired to be paid by
    Trustor  pursuant to any  provision  of this Deed of Trust,  and in addition
    thereto such  further  amount as shall be suf ficient to cover the costs and
    expenses of  collection,  including  com  pensation  to  Beneficiary  and/or
    Trustee,  their agents and counsel and any expenses  incurred by Beneficiary
    or Trustee hereunder. In




<PAGE> 25

    the event  Trustor  shall fail  forthwith  to pay such  amounts upon demand,
    Beneficiary and/or Trustee shall be entitled and empowered to institute such
    action or  proceedings  at law or in equity as may be advised by its counsel
    for the collection of the sums so due and unpaid, and may prosecute any such
    action or proceedings to judgment or final decree.

                      (b)  Beneficiary  and/or  Trustee  shall  be  entitled  to
    recover  judgment as aforesaid either before or after or during the pendency
    of any  proceedings  for the  enforcement  of the provisions of this Deed of
    Trust and the right of  Beneficiary  and/or Trustee to recover such judgment
    shall not be affected by any entry or sale hereunder,  or by the exercise of
    any other right,  power or remedy for the  enforcement  of the provisions of
    this Deed of Trust or the  foreclosure of the lien hereof;  and in the event
    of a  sale  of  the  Mortgaged  Property  or  any  part  thereof  and of the
    application  of the proceeds of sale, as provided in this Deed of Trust,  to
    the payment of the indebtedness  hereby secured,  Beneficiary and/or Trustee
    shall be  entitled to enforce  payment  of, and to receive all amounts  then
    remaining  due and unpaid  upon,  the  Secured  Obligations,  and to enforce
    payment  of all other  charges,  payments  and costs due under  this Deed of
    Trust and shall be entitled to recover  judgment for any portion of the debt
    remaining  unpaid,  with  interest  thereon at the Default  Rate. In case of
    proceedings  against  Trustor in insolvency or bankruptcy or any proceedings
    for its  reorganization  or involving the  liquidation  of its assets,  then
    Beneficiary  and/or  Trustee  shall be entitled to prove the whole amount of
    principal and interest due upon the Secured  Obligations  to the full amount
    thereof,  and all other  payments,  charges and costs due under this Deed of
    Trust without deducting therefrom any proceeds obtained from the sale of the
    whole or any part of the Mortgaged Property.

                      (c) No recovery of any judgment by  Beneficiary or Trustee
    and no levy of an execution  under any judgment upon the Mortgaged  Property
    or upon any other property of Trustor shall affect,  in any manner or to any
    extent,  the lien of this Deed of Trust upon the  Mortgaged  Property or any
    part thereof,  or any liens,  rights,  powers or remedies of  Beneficiary or
    Trustee  hereunder,   but  such  liens,  rights,   powers  and  remedies  of
    Beneficiary or Trustee shall continue unimpaired as before.

                      (d) Any moneys thus  collected by  Beneficiary  or Trustee
    under this Section 2.04 shall be applied by Beneficiary  in accordance  with
    the provisions of paragraph (k) of Section 2.03.

             Section 2.05 Receiver,  Waiver. After the happening of any Event of
    Default and immediately upon the  commencement of any action,  suit or other
    legal  proceedings  by  Beneficiary  or Trustee to obtain  judgment  for the
    principal of, or interest on, and any other amounts constituting the Secured
    Obligations,  including  (without  limitation) all other sums required to be



<PAGE> 26

    paid by Trustor  pursuant to any  provision  of this Deed of Trust or of any
    nature in aid of the enforcement of the Secured  Obligations or of this Deed
    of Trust,  Trustor  will (a) waive the  issuance  and service of process and
    submit to a voluntary  appearance in such action, suit or proceeding and (b)
    if  required by  Beneficiary  or Trustee,  consent to the  appointment  of a
    receiver or receivers of the  Mortgaged  Property or any part thereof and of
    all the earnings, revenues, rents, maintenance payments, issues, profits and
    income thereof in accordance  with Section 2.11 hereof.  After the happening
    of any Event of Default and during its continuance, or upon the commencement
    of any  proceedings  to  foreclose  this  Deed of  Trust or to  enforce  the
    specific  performance  hereof or in aid thereof or upon the  commencement of
    any  other  judicial  proceeding  to  enforce  any right of  Beneficiary  or
    Trustee,  Beneficiary or Trustee shall be entitled, as a matter of right, if
    it shall so elect,  without  the  giving  of  notice to any other  party and
    without regard to the adequacy or inadequacy of any security for the Deed of
    Trust  indebtedness,  forthwith  either before or after declaring the unpaid
    principal  of  the  Secured  Obligations  to be  due  and  payable,  to  the
    appointment of such a receiver or receivers.

             Section  2.06   Beneficiary's   Possession.   Notwithstanding   the
    appointment  of any receiver,  liquidator or trustee of Trustor or of any of
    its property, or of the Mortgaged Property or any part thereof,  Beneficiary
    and  Trustee  shall be  entitled  to retain  possession  and  control of the
    Mortgaged Property.

             Section 2.07 Remedies  Cumulative.  No remedy herein conferred upon
    or reserved to  Beneficiary  or Trustee is intended to be  exclusive  of any
    other  remedy or remedies  which  Beneficiary  or Trustee may be entitled to
    exercise against Trustor and each and every such remedy shall be cumulative,
    and shall be in addition to every other  remedy  given  hereunder  or in the
    Agreement or in any other Loan Document now or hereafter  existing at law or
    in equity or by statute.  No delay by or omission of  Beneficiary or Trustee
    to  exercise  any right or power  shall be  construed  to be a waiver of any
    Event of Default or any  acquiescence  therein;  and every  power and remedy
    given  in this  Deed of  Trust  or in the  Agreement  or in any  other  Loan
    Document to  Beneficiary  or Trustee may be  exercised  from time to time as
    often as may be deemed  expedient by Beneficiary  or Trustee.  The resort to
    any  remedy  provided  hereunder  or in the  Agreement  or in any other Loan
    Document or provided by law or at equity shall not prevent the concurrent or
    subsequent  employment of any other  appropriate  remedy or remedies against
    Trustor.  By the acceptance of payment of principal of or interest on or any
    other amount due in respect of any of the Secured  Obligations after its due
    date,  Beneficiary  and  Trustee  do not waive the right  either to  require
    prompt payment when




<PAGE> 27

    due of all other amounts  secured hereby or to regard as an Event of Default
    the failure to pay any other such amounts.  Nothing in this Deed of Trust or
    in the Agreement or in any  instrument  evidencing  the Secured  Obligations
    shall  affect the  obligation  of Trustor to pay (i) the  principal  of, and
    interest on, the Secured Obligations in the manner and at the time and place
    therein or in the Agreement  expressed or (ii) the other Secured Obligations
    in the manner and at the time herein expressed.

             Section  2.08  Agreement  by Trustor.  Trustor will not at any time
    insist upon, or plead,  or in any manner  whatever claim or take any benefit
    or advantage of any stay or extension or moratorium  law, any exemption from
    execution or sale of the Mortgaged  Property or any part  thereof,  wherever
    enacted,  now or at any time  hereafter  in  force,  which  may  affect  the
    covenants and terms of  performance  of this Deed of Trust or any other Loan
    Document,  or claim, take or insist upon any benefit or advantage of any law
    now or hereafter in force  providing  for the  valuation or appraisal of the
    Mortgaged Property, or any part thereof,  prior to any sale or sales thereof
    which may be made  pursuant  to any  provision  herein,  or  pursuant to the
    decree, judgment or order of any court of competent jurisdiction,  or, after
    any such sale or  sales,  claim or  exercise  any  right  under any  statute
    heretofore  or hereafter  enacted to redeem the property so sold or any part
    thereof; and Trustor hereby expressly waives all benefit or advantage of any
    such law or laws and covenant not to hinder,  delay or impede the  execution
    of any power herein granted or delegated to  Beneficiary or Trustee,  but to
    suffer and permit the execution of every power as though no such law or laws
    had been made or enacted.  Trustor,  waives,  to the extent that it lawfully
    may, all right to have the Mortgaged  Property or any part thereof marshaled
    upon any foreclosure hereof.

             Section 2.09 Use and Occupancy Payments.  During the continuance of
    any Event of Default and pending the exercise by Beneficiary  and Trustee of
    their rights to exclude Trustor from all or any part of the Premises, unless
    Trustor is legally entitled to continue possession of the Premises,  Trustor
    agrees to pay the fair and reasonable rental value for the use and occupancy
    of the Premises or any portion  thereof which are in its possession for such
    period and,  upon  default of any such  payment,  will vacate and  surrender
    possession of the Premises to  Beneficiary  or Trustee or to a receiver,  if
    any,  and in  default  thereof  may be  evicted  by any  summary  action  or
    proceeding for the recovery of possession of the Premises for non-payment of
    rent,  however  designated.  Such rental  obligation by the Trustor shall be
    determined  by the extent that the Secured  Obligations  have been deemed to
    have  been  reduced  (the  "Reduction).  It is  agreed  that  the  fair  and
    reasonable  rental  value  for  use and  occupancy  of the  Premises  may be
    difficult or  impossible to ascertain;  therefore,  Trustor and  Beneficiary


<PAGE> 28

    hereby agree that the fair and reasonable  rental value shall in no event be
    less than an amount equal to the debt service on the Reduction. Any payments
    received by Beneficiary  shall be applied in accordance with Section 2.03(k)
    of this Deed of Trust.

             Section 2.10 Beneficiary's  Right to Purchase.  In case of any sale
    under the foregoing  provisions  of this Article II,  whether made under the
    power of sale hereby given or pursuant to judicial proceedings,  Beneficiary
    or Trustee  may bid for and  purchase  any  property,  and may make  payment
    therefor as hereinafter  set forth or as set forth in Section 2.03(l) above,
    and,  upon  compliance  with the terms of said  sale,  may hold,  retain and
    dispose of such property without further  accountability  therefor.  For the
    purpose of making  settlement  or payment  for the  property  or  properties
    purchased,  Beneficiary  and Trustee shall be entitled to use and apply such
    of  the  Secured  Obligations  held  by it or  the  other  Secured  Parties,
    including (without  limitation) any accrued and unpaid interest thereon,  as
    it may elect, or as may be otherwise provided for in Section 2.03(l) above.

             Section  2.11   Appointment  of  Receiver.   Upon   application  of
    Beneficiary or Trustee to any court of competent jurisdiction,  if any Event
    of Default shall have occurred and so long as it shall be continuing, to the
    extent  permitted by law, a receiver may be appointed to take  possession of
    and to operate,  maintain,  develop and manage the Mortgaged Property or any
    part thereof.  In every case when a receiver of the whole or any part of the
    Mortgaged  Property shall be appointed under this Section 2.11 or otherwise,
    the net income and profits of the Mortgaged  Property shall,  subject to the
    order of any court of competent jurisdiction,  be paid over to, and shall be
    received  by,  Beneficiary  or Trustee to be applied as  provided in Section
    2.03(k) hereof.

             Section 2.12 No Waiver.  Beneficiary  and/or  Trustee may resort to
    any  security  given  by this  Deed of Trust or to any  other  security  now
    existing  or  hereafter  given to secure the  payment of any of the  Secured
    Obligations secured hereby, in whole or in part, and in such portions and in
    such order as may seem best to  Beneficiary  or  Trustee  in its  reasonable
    discretion,  and any such  action  shall not in any way be  considered  as a
    waiver of any of the rights, benefits, liens or security interest created by
    this Deed of Trust.


                                   ARTICLE III

                         ASSIGNMENT OF LEASES AND RENTS


<PAGE> 29

             Section  3.01 Lease  Related  Definitions.  As used in this Deed of
    Trust: (a) "Lease" means any lease,  sublease,  or other similar  agreement,
    now or  hereafter  existing,  under the terms of which any person other than
    Trustor  has or  acquires  any right to  occupancy  or use of the  Mortgaged
    Property,  or any part thereof, or interest therein;  (b) "Lessee" means the
    lessee,  sublessee,  licensee,  tenant or other  person  having the right to
    occupy or use all or any part of the Mortgaged  Property under a Lease;  and
    (c) "Rent" means the rents, additional rents and other consideration payable
    to Trustor by the Lessee under the terms of a Lease.  Whenever  reference is
    made in this Deed of Trust to a lease, license, lessee, licensee, tenancy or
    tenant,  such  reference  shall be deemed to include a sublease,  sublessee,
    license, licensee, subtenancy or subtenant, as the case may be.

             Section 3.02 Assignment of Leases and Rents. Trustor hereby assigns
    to  Beneficiary  and to Trustee for the benefit of  Beneficiary  all Leases,
    together  with  all  Rents  payable  under  the  Leases,  now or at any time
    hereafter  existing,  such assignment  being upon the following  terms:  (a)
    until receipt from  Beneficiary  of notice of the  occurrence of an Event of
    Default, each Lessee may pay rent directly to Trustor, (b) upon receipt from
    Beneficiary  of notice that an Event of Default  exists,  each Lessee shall,
    and is hereby  authorized  and directed to, pay directly to  Beneficiary  or
    Trustee (as therein specified) all Rent thereafter accruing, and the receipt
    of such Rent by  Beneficiary or Trustee shall be a release of such Lessee to
    the extent of all amounts so paid,  (c) Rent so received by  Beneficiary  or
    Trustee shall be applied by Beneficiary or Trustee first to the expenses, if
    any,  of  collection  and then in  accordance  with  Article II hereof,  (d)
    without impairing its rights  hereunder,  Beneficiary or Trustee may, at its
    option,  at any time  and from  time to time,  release  to  Trustor  Rent so
    received by Beneficiary or Trustee, or any part thereof, (e) Beneficiary and
    Trustee shall not be liable for their  failure to collect,  or their failure
    to exercise  diligence in the  collection of, Rent, but shall be accountable
    only for Rent  that  they  shall  actually  receive.  As among  Beneficiary,
    Trustee,  Trustor  and any person  claiming  through or under  Trustor,  the
    assignment  contained  in this  Section  3.02 is  intended  to be  absolute,
    unconditional  and  presently  effective,  and the  provisions of subsection
    3.02(a) are intended for the benefit of each Lessee and shall never inure to
    the benefit of Trustor or any person claiming  through or under Trustor.  It
    shall never be  necessary  for  Beneficiary  or Trustee to  institute  legal
    proceedings of any kind whatsoever to enforce the provisions of this Section
    3.02.  Notwithstanding anything herein to the contrary,  Trustor may collect
    such Rent until such time as an Event of Default shall occur hereunder.

             Section  3.03  Beneficiary's  Consent.  Nothing in this Article III
    shall ever be  construed as (a)  allowing  any Lease


<PAGE> 30

    without Beneficiary's prior written consent unless otherwise permitted under
    the Agreement, or (b) subordinating this Deed of Trust to any Lease.

             Section 3.04 Lease  Related  Covenants.  Trustor  covenants to: (a)
    upon demand by  Beneficiary,  assign to Beneficiary or Trustee,  by separate
    instrument in form and substance  satisfactory to  Beneficiary,  any and all
    Leases, and/or all Rents payable thereunder,  including, but not limited to,
    any Lease which is now in existence or which may be executed  after the date
    hereof;  (b) not accept from any Lessee,  nor permit any Lessee to pay, Rent
    for more than one month in  advance  except  for  payment  in the  nature of
    security for performance of Lessee's  obligations  unless otherwise provided
    for in the Lease;  (c) comply  with the terms and  provisions  of each Lease
    including,  without limitation,  the payment of all sums required to be paid
    by Trustor or which any Lessor has an option to pay under any Lease in order
    to prevent any  reduction in or offset  against any Rent  payable  under any
    Lease or any default thereunder;  (d) not amend, extend, cancel, abridge, or
    otherwise  modify,  or accept  surrender of, or renew, any Lease without the
    written  consent  of  Beneficiary  other  than  in the  ordinary  course  of
    business, (e) not assign, transfer or mortgage any Lease without the written
    consent of  Beneficiary;  (f) not assign,  transfer,  pledge or mortgage any
    Rent; (g) not waive,  excuse,  release or condone any  nonperformance of any
    covenant  of any Lease by any Lessee  other than in the  ordinary  course of
    business;  (h) give to  Beneficiary  and  Trustee  duplicate  notice of each
    material  default by each Lessee;  (i) on all Leases executed after the date
    hereof,  cause  each  Lessee to agree  (and each  Lessee  under  each  Lease
    executed  after the date  hereof does so agree) to give to  Beneficiary  and
    Trustee  written notice of each and every material  default by Trustor under
    its Lease and not exercise any remedies under such Lease unless  Beneficiary
    or Trustee fails to cure such material  default  within a reasonable  period
    after  Beneficiary  and Trustee have  received such notice;  provided,  that
    Beneficiary  or Trustee shall never have any  obligation or duty to cure any
    such material  default;  (j) enforce its rights with regard to all Leases in
    the ordinary course of business;  and (k) not enter into any Lease affecting
    the Mortgaged Property or any part thereof unless otherwise  permitted under
    the Agreement without the prior approval of Beneficiary.

             Section 3.05  Beneficiary  Not Liable.  Beneficiary  and/or Trustee
    shall not be obligated to perform or discharge, nor does it hereby undertake
    to perform or discharge, any obligation,  duty or liability under any Lease,
    or under or by reason of this assignment,  and Trustor shall and does hereby
    agree to indemnify  and to hold  Beneficiary  and Trustee  harmless from and
    against any and all liability,  loss or damage which  Beneficiary



<PAGE> 31

    or Trustee  may or might incur under any Lease or under or by reason of this
    assignment  and from and against  any and all claims and demands  whatsoever
    which  may be  asserted  against  Beneficiary  or  Trustee  by reason of any
    alleged  obligations or undertakings on its part to perform or discharge any
    of the  terms,  covenants  or  agreements  contained  in any  Lease.  Should
    Beneficiary  or Trustee incur any such  liability,  loss or damage under any
    Lease or under or by reason of this  assignment,  or in the  defense  of any
    such claims or demands,  the amount thereof,  including all costs,  expenses
    and attorneys'  fees,  shall be secured  hereby and  constitute  part of the
    Secured  Obligations,  and Trustor  shall  reimburse  Beneficiary  therefore
    immediately  upon  demand,  and  upon  the  failure  of  Trustor  to  do  so
    Beneficiary  may declare all sums secured by this Deed of Trust  immediately
    due and payable.

             Section 3.06 Estoppel  Certificates.  On all Leases  executed after
    the date hereof,  all Leases  shall  provide for the giving by the Lessee of
    certificates  with respect to the status of such Leases,  and Trustor  shall
    exercise its right to request such certificates  within ten (10) days of any
    demand  therefor by  Beneficiary.  Trustor shall furnish to  Beneficiary  or
    Trustee,  within ten (10) days after a request by  Beneficiary or Trustee to
    do so, an executed counterpart of all Leases.

             Section 3.07 Lease Approval  Requirements.  On all Leases  executed
    after the date hereof,  all Leases and Lessees of the Premises,  or any part
    thereof,  must be acceptable to and approved by Beneficiary unless otherwise
    provided  under the  Agreement;  and all Lessees shall execute such estoppel
    certificates,   subordinations,   attornments   and  other   agreements   as
    Beneficiary may require. Under no circumstances shall Beneficiary or Trustee
    be liable for any obligation to pay any leasing commission, brokerage fee or
    similar fee or charge in connection with any Lease nor shall  Beneficiary or
    Trustee be  obligated to complete  any  Improvements  for the benefit of any
    Lessee.


                                   ARTICLE IV

                                  MISCELLANEOUS

             Section 4.01 Benefit of Beneficiary.  All of the grants, covenants,
    terms,  provisions  and  conditions of this Deed of Trust shall run with the
    land and shall apply to, bind and inure to the benefit of the successors and
    assigns of the respective  parties  hereto;  provided,  that Trustor may not
    assign  its  obligations  hereunder  without  the prior  written  consent of
    Beneficiary.

             Section  4.02 Savings  Clause.  In the event any one or more of the
    provisions  contained  in this Deed of Trust shall



<PAGE> 32

    for any  reason  be held to be  invalid,  illegal  or  unenforceable  in any
    respect,  such  invalidity,  illegality or  unenforceability  shall,  at the
    option of Beneficiary,  not affect any other provision of this Deed of Trust
    but this Deed of Trust shall be  construed  as if such  invalid,  illegal or
    unenforceable provision had never been contained herein or therein.

             Section 4.03 Notices. All notices hereunder shall be given pursuant
    to the  terms of  Section  11.1 of the  Agreement,  and  supplementing  such
    provisions,  notices  required  to be  given  to  Trustee  shall be given at
    Trustee's address set forth herein.

             Section  4.04  Governing  Law.  This Deed of Trust  shall,  without
    regard to place of contract or payment,  be construed and enforced according
    to the laws of the state  where  the  Mortgaged  Property  is  located,  all
    without regard to principles of conflict of laws.

             Section  4.05  No  Change.  Neither  this  Deed  of  Trust  nor any
    provision hereof may be changed, waived, discharged or terminated, except by
    an instrument in writing, signed by Beneficiary and Trustor.

             Section 4.06 Security  Agreement and Fixture  Filing.  This Deed of
    Trust shall be deemed to be a security agreement and fixture filing pursuant
    to the Uniform  Commercial Code of the state where the Mortgaged Property is
    located.

             Section 4.07 No Usury. In the event that Beneficiary,  in enforcing
    its  rights  hereunder,   determines  that  charges  and  fees  incurred  in
    connection  with the Secured  Obligations  may, under the  applicable  usury
    laws,  cause the interest rate herein to exceed the maximum  allowed by law,
    then such  interest  shall be  recalculated  and any excess over the maximum
    interest  permitted  by said laws shall be  credited  to the then  principal
    outstanding  balance to reduce said balance by that amount. It is the intent
    of the parties hereto that Trustor under no circumstances  shall be required
    to pay, nor shall Beneficiary be entitled to collect,  any interest which is
    in excess of the maximum legal rate  permitted  under the  applicable  usury
    laws.

             Section 4.08 Effect of Partial  Release.  No release of any part of
    the  Mortgaged  Property  or of any other  property  conveyed  to secure the
    obligations  secured  hereby  shall in any way alter,  vary or diminish  the
    force,  effect  or lien or  security  interest  of this Deed of Trust on the
    Mortgaged  Property  or portion  thereof  remaining  subject to the lien and
    security interest created hereby.

             Section 4.09 Beneficiary's  Dealing with Successors and



<PAGE> 33

    Lessees.  In the event  Trustor or any of  Trustor's  successors  conveys or
    leases without the prior  approval of Beneficiary or as otherwise  permitted
    herein or in the Agreement any interest in the  Mortgaged  Property,  or any
    part thereof, to any other party,  Beneficiary and Trustee may deal with any
    owner or lessee of any part of the Mortgaged Property with reference to this
    Deed of Trust and to the Secured  Obligations,  either by forbearance on the
    part of Beneficiary or release of all or any part of the Mortgaged  Property
    or of any  other  property  securing  payment  of any  Secured  Obligations,
    without  in any way  modifying  or  affecting  Beneficiary's  and  Trustee's
    rights, remedies, liens or security interests hereunder (including the right
    to  exercise  any one or more of the  remedies  described  or referred to in
    Article I,  Article  II,  Article III or Article IV hereof in the event such
    conveyance is made in contravention of the provisions of this Deed of Trust)
    or the liability of Trustor or any other party liable for the payment of the
    Secured  Obligations,  in whole or in part.  This shall not be  construed to
    allow any such conveyance or leasing by Trustor,  except as permitted herein
    or in the Agreement.

             Section  4.10 No Waiver by  Beneficiary.  All options and rights of
    election herein  provided for the benefit of Beneficiary  and/or Trustee are
    continuing, and the failure to exercise any such option or right or election
    upon a particular default or breach or upon any subsequent default or breach
    shall not be  construed  as waiving  the right to  exercise  such  option or
    election at any later date.  By the  acceptance  of payment of  principal or
    interest after its due date,  Beneficiary  and/or Trustee does not waive the
    right either to require prompt payment when due of all other amounts secured
    hereby or to regard as an Event of Default the failure to pay any other such
    amounts. No exercise of the rights and powers herein granted and no delay or
    omission in the  exercise of such rights and powers shall be held to exhaust
    the same or be construed as a waiver thereof, and every such right and power
    may be exercised at any time and from time to time.  All grants,  covenants,
    terms and conditions  hereof shall bind Trustor and all successive owners of
    the Premises.

             Section  4.11  Headings  Descriptive.  The  headings of the several
    sections and  subsections of this Deed of Trust are inserted for convenience
    only and shall not in any way affect  the  meaning  or  construction  of any
    provision of this Deed of Trust.

             SECTION  4.12  WAIVER OF TRIAL BY JURY.  THE  TRUSTOR,  TRUSTEE AND
    BENEFICIARY  WAIVE  THE RIGHT TO TRIAL BY JURY IN ANY  ACTION OR  PROCEEDING
    BASED UPON, ARISING OUT OF OR IN ANY WAY CONNECTED TO THIS DEED OF TRUST.

             Section  4.13  Indemnification.  The Trustor  agrees to pay, and to
    save,  indemnify  and keep the  Beneficiary  and its



<PAGE> 34

    respective directors,  officers,  employees,  attorneys, experts, and agents
    harmless  from,  any and all  liabilities,  costs and  expenses  (including,
    without  limitation,  legal fees and  expenses),  losses or damages (i) with
    respect  to, or  resulting  from,  any delay in paying,  any and all excise,
    sales or other taxes which may be payable or  determined  to be payable with
    respect to any of the Mortgaged Property, (ii) with respect to, or resulting
    from, any delay in complying  with any  requirement of law applicable to any
    of  the  Mortgaged   Property  or  (iii)  in  connection  with  any  of  the
    transactions  contemplated  by this  Deed of Trust,  including  the fees and
    disbursements of counsel and of any other experts,  which Beneficiary or its
    respective directors, officers, employees,  attorneys, experts or agents may
    incur in connection with (w) the  administration or enforcement of this Deed
    of Trust,  including  such expenses as are incurred to preserve the value of
    the Mortgaged Property and the validity,  perfection,  rank and value of any
    liens granted  hereunder,  (x) the collection,  sale or other disposition of
    any of the Mortgaged Property, (y) the exercise by the Beneficiary of any of
    the  rights  conferred  upon it  hereunder  or (z) any  Default  or Event of
    Default, but excluding any such liabilities,  costs and expenses,  losses or
    damages  incurred  solely  by  reason of the  gross  negligence  or  willful
    misconduct of the party seeking to be  indemnified  as determined by a final
    order or judgment of a court of competent jurisdiction.

             Any amount  due  hereunder  which is not paid on demand  shall bear
    interest  at a rate equal to the  Default  Rate and shall be a lien upon the
    Mortgaged Property and shall be secured hereby.

             The agreements of the Trustor  contained in this Section 4.13 shall
    survive the  payment and  performance  of the  Secured  Obligations  and the
    termination of the liens and security  interests granted hereby.  All of the
    Trustor's obligations to indemnify Beneficiary and its directors,  officers,
    employees,   attorneys,   experts  and  agents   hereunder   shall  (without
    duplication)  be in  addition  to,  and  shall  not  limit in any  way,  the
    Trustor's  indemnification  obligations contained in the Agreement or in any
    other Loan Document.

             Section 4.14 Advances  under the  Agreement.  It is understood  and
    agreed  that the  funds to be  advanced  under  this Deed of Trust are to be
    advanced  subject to and in accordance  with the provisions of the Agreement
    and the other Loan  Documents,  and that all sums  advanced  thereunder  and
    hereunder are included within the Secured Obligations secured hereby.

             Section 4.15  Limitation of Trustee's  Liability.  Trustee shall be
    protected in acting upon any notice, request,  consent,  demand,  statement,
    note or other  paper or  document  believed  by



<PAGE> 35

    Trustee  to be  genuine  and to have been  signed  by the  party or  parties
    purporting  to sign the same.  Trustee  shall not be liable for any error of
    judgment,  nor for  any act  done or  step  taken  or  omitted,  nor for any
    mistakes of law or fact,  nor for anything  which  Trustee may do or refrain
    from  doing  in  good  faith,   nor   generally   shall   Trustee  have  any
    accountability  hereunder except for willful misconduct or gross negligence.
    Trustee may act hereunder and may sell or otherwise dispose of the Mortgaged
    Property or any part thereof as herein provided,  although Trustee has been,
    may now or may hereafter  be,  attorneys,  officers,  agents or employees of
    Beneficiary,  in respect of any matter of business  whatsoever.  Beneficiary
    and  Trustee  shall  not be  liable  for any loss to any  Chattels  in their
    possession,  provided  that they  shall  use  reasonable  care with  respect
    thereto; and any such loss shall not diminish the debt due.

             Section 4.16  Substitution of Trustee.  Beneficiary shall have, and
    is hereby granted with warranty of further assurances, the irrevocable power
    to remove a Trustee or successor Trustee and to appoint a substitute Trustee
    or Trustees  hereunder  (including,  in case of death or refusal to act of a
    Trustee or  Trustees or their  nonacceptance  of, or  dissatisfaction  with,
    Trustee,  absence  or any other  reason),  to  appoint a new or  replacement
    substitute  Trustee or Trustees,  to be exercised at any time without notice
    and  without  specifying  any reason  therefor,  by filing for record in the
    office where this  instrument is recorded a Deed of Appointment or Notice of
    Substitution of Trustee.  The power of appointment of a successor Trustee or
    Trustees may be exercised as often as and whenever  Beneficiary  may choose,
    and the exercise of the power of appointment, no matter how often, shall not
    be an  exhaustion  thereof.  Upon the  recordation  of such Deed or Deeds of
    Appointment  or Notice or Notices of  Substitution  of  Trustee,  Trustee or
    Trustees so appointed  shall  thereupon,  without any further act or deed of
    conveyance,  become fully vested with  identically the same title and estate
    in and to the Mortgaged Property and with all the rights, powers, trusts and
    duties of their,  his or its  predecessor  in the trust  hereunder with like
    effect as if  originally  named as Trustee or as one of Trustees  hereunder.
    Whenever in this Deed of Trust  reference  is made to  Trustee,  it shall be
    construed to mean Trustee or Trustees for the time being,  whether  original
    or successors or successor in trust; and all title, estate,  rights, powers,
    trusts and duties  hereunder  given or  appertaining  to or  devolving  upon
    Trustee  shall  be in each of  Trustees  so that  any  action  hereunder  or
    purporting  to be  hereunder  of any one of the  original  or any  successor
    Trustee  shall for purposes be  considered  to be, and as effective  as, the
    action of all Trustees.

             Section 4.16 Particular State Provisions.  There is attached hereto
    and made a part hereof Exhibit B containing  additional  provisions that are
    necessary  or  appropriate  under the



<PAGE> 36

    laws of the state where the Mortgaged Property is located or pursuant to the
    provisions of any permitted property liens.

             IN WITNESS  WHEREOF,  this Deed of Trust has been duly  executed by
    Trustor as of the day and year first above written.


                                                     TRUSTOR

                                                     PAYLESS CASHWAYS, INC.


     By:_____________________________
     Name:________________________
     Title:_______________________



<PAGE> 37







                                    EXHIBIT A

                               DESCRIPTION OF LAND
                               -------------------



<PAGE> 38







                                    EXHIBIT B

                              LOCAL LAW PROVISIONS
                              --------------------