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                                  EXHIBIT 10.70

                     GUARANTOR PLEDGE AND SECURITY AGREEMENT

     THIS GUARANTOR PLEDGE AND SECURITY AGREEMENT (this "AGREEMENT"), is made as
of July ___, 2002, by LAUGHLIN HOLDINGS LLC, a Delaware limited liability
company, having its principal place of business at c/o Horizon Group Properties,
Inc., 77 West Wacker Drive, Suite 4200, Chicago, Illinois 60601 (together with
its successors and assigns, "PLEDGOR") for the benefit of UBS WARBURG REAL
ESTATE INVESTMENTS INC., a Delaware corporation, having an address at 1285
Avenue of the Americas, 11th Floor, New York, New York 10019 (together with its
successors and assigns, collectively, "LENDER").

                                    RECITALS

     A.   Pledgor is the sole equity member in Laughlin Outlet Center LLC, a
Delaware limited liability company (the "Company").

     B.   Pledgor, Medford Holdings LLC ("Medford Holdings") and Warrenton
Holdings LLC ("Warrenton Holdings"; and Warrenton Holdings, together with
Medford Holdings, each an "Affiliate Pledgor" and collectively, the "Affiliate
Pledgors") and Lender have entered into a Mezzanine Loan Agreement of even date
herewith (as the same may be amended, restated, replaced, supplemented or
otherwise modified from time to time, the "Mezzanine Loan Agreement").
Capitalized terms not otherwise defined herein shall have the meaning set forth
in the Mezzanine Loan Agreement.

     C.   Under the provisions of the Mezzanine Loan Agreement, Lender agreed,
subject to the terms and conditions contained therein, to make a loan ("Laughlin
Loan") to Pledgor as evidenced by that certain Promissory Note of even date
herewith made by Pledgor to Lender in the original maximum principal amount of
One Million Seven Hundred Fifty Thousand and No/100 Dollars ($1,750,000.00) (as
the same may be amended, restated, replaced, supplemented or otherwise modified
from time to time, the "Laughlin Note") and secured by a certain Pledge and
Security Agreement dated of even date herewith made by Pledgor in favor of
Lender (the "First Pledge").

     D.   Simultaneously with the execution of this Agreement, Lender made the
following additional loans to Medford Holdings and Warrenton Holdings:

     (a)  MEDFORD. Lender made a loan in the principal amount of $1,000,000.00
     (the "MEDFORD LOAN") to Medford Holdings, evidenced by a certain Promissory
     Note dated of even date herewith made by Medford Holdings to Lender (the
     "MEDFORD NOTE") and secured by a certain Pledge and Security Agreement
     dated of even date herewith made by Medford Holdings in favor of Lender
     (the "MEDFORD PLEDGE") and any and all of the Mezzanine Loan Documents
     executed in connection with the Medford Loan (collectively, the "MEDFORD
     LOAN DOCUMENTS").

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     (b)  WARRENTON. Lender made a loan in the principal amount of $750,000.00
     (the "WARRENTON LOAN") to Warrenton Holdings, evidenced by a certain
     Promissory Note dated of even date herewith made by Warrenton Holdings to
     Lender (the "WARRENTON NOTE"; and the Warrenton Note, together with the
     Medford Note, each, an "AFFILIATE NOTE" and collectively, the "AFFILIATE
     NOTES") and secured by a certain Pledge and Security Agreement dated of
     even date herewith made by Warrenton Holdings in favor of Lender (the
     "WARRENTON PLEDGE"; and the Warrenton Pledge, together with the Medford
     Pledge, each an "AFFILIATE PLEDGE" and collectively, the "AFFILIATE
     PLEDGES") and any and all of the Loan Documents executed in connection with
     the Warrenton Loan (collectively, the "WARRENTON LOAN DOCUMENTS"; and the
     Warrenton Loan Documents, together with the Medford Loan Documents,
     collectively, the "AFFILIATE LOAN DOCUMENTS").

     E.   Each of Pledgor and Affiliate Pledgors are Affiliates.

     F.   Lender has requested that Pledgor guaranty each Affiliate Pledgor's
respective obligations under each of the Affiliate Notes and the Affiliate Loan
Documents and the performance and observance of all of the provisions of the
Affiliate Loan Documents (collectively, the "DEBT"), which guaranty shall be
evidenced by the Guaranty contained in SECTION 10 herein and secured by, among
other things, this Agreement (the "GUARANTY").

     G.   Pledgor acknowledges that, by reason of the foregoing, it will receive
substantial economic and other benefits from Lender making the Affiliate Loans
to the Affiliate Pledgors, and acknowledges that without this Agreement and the
Guaranty contained herein, Lender would be unwilling to make the Affiliate Loans
to the Affiliate Pledgors.

     NOW THEREFORE, to secure that Pledgor shall pay when due and fully and
promptly perform all of the indebtedness, obligations, covenants, agreements and
liabilities of Pledgor for the benefit of Lender under this Agreement,
including, without limitation, the Guaranty contained in SECTION 10 hereof,
together with all interest and other charges thereon, whether direct or
indirect, existing, future, contingent or otherwise, due or to become due under
or arising out of or in connection with the Affiliate Notes, this Agreement or
any of the Affiliate Loan Documents, any and all modifications, extensions and
renewals of any of the foregoing; and any and all expenses and costs of
collection or enforcement, including, without limitation, reasonable attorneys'
fees incurred by Lender in the collection or enforcement of any of the
foregoing, or in the exercise of any of the rights or remedies under this
Agreement or applicable law, Pledgor agrees as follows:

          1.   DEFINED TERMS. Unless otherwise provided herein, all capitalized
terms used but not defined in this Agreement shall have the respective meanings
ascribed thereto in the Mezzanine Loan Agreement and, for the purposes of this
Agreement, the following capitalized terms shall have the following meanings:

               (a)  "ASSIGNMENT OF INTEREST" shall have the meaning ascribed
thereto in SECTION 2 hereof.

               (b)  "CHARTER DOCUMENTS" shall mean the agreements and
instruments

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listed on EXHIBIT A hereto, as each of the same may hereafter be amended,
restated, replaced, supplemented or otherwise modified from time to time.

               (c)  "COLLATERAL" shall have the meaning ascribed thereto in
SECTION 2 hereof.

               (d)  "OBLIGATIONS" shall mean all of the obligations of (i)
Pledgor under the Guaranty and this Agreement and (ii) Affiliate Pledgors under
the Affiliate Notes, the other Affiliate Loan Documents and the Mezzanine Loan
Agreement.

               (e)  "OTHER COLLATERAL" shall have the meaning ascribed thereto
in SECTION 4.7 hereof.

               (f)  "OTHER SECURITY DOCUMENTS" shall have the meaning ascribed
thereto in SECTION 4.7 hereof.

               (g)  "PLEDGED INTERESTS" shall have the meaning ascribed thereto
in SECTION 2 hereof.

               (h)  "UNIFORM COMMERCIAL CODE" shall mean the Uniform Commercial
Code as in effect from time to time in the state of New York.

          2.   PLEDGE AND DELIVERY OF COLLATERAL.

               (a)  THE PLEDGE. As collateral security for the prompt payment in
full when due (whether at stated maturity, by acceleration or otherwise) of the
Obligations, Pledgor hereby pledges and grants to Lender as hereinafter
provided, a second priority security interest in all of Pledgor's right, title
and interest in the following property, whether now owned by Pledgor or
hereafter acquired and whether now existing or hereafter coming into existence
(all being collectively referred to herein as "COLLATERAL"):

                    (i)     its ownership, partnership or membership interests
in the Company held by Pledgor, together with the certificates (if any)
evidencing the same (the "PLEDGED INTERESTS");

                    (ii)    all ownership interests, membership interests,
shares, securities, moneys, instruments or property representing a dividend, a
distribution or return of capital upon or in respect of the Pledged Interests,
or otherwise received in exchange therefor, and any warrants, rights or options
issued to the holders of, or otherwise in respect of, the Pledged Interests;

                    (iii)   all rights of Pledgor under the Charter Documents or
any other agreement or instrument relating to the Pledged Interests, including,
without limitation, (i) all rights of Pledgor to receive moneys or distributions
with respect to the Pledged Interests due and to become due under or pursuant to
the Charter Documents, (ii) all rights of Pledgor to receive proceeds of any
insurance, indemnity, warranty or guaranty with respect to the Pledged
Interests, (iii) all claims of

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Pledgor for damages arising out of or for breach of or default under a Charter
Document, and (iv) any right of Pledgor to perform thereunder and to compel
performance and otherwise exercise all rights and remedies thereunder; and

                    (iv)    all proceeds of and to any of the property of
Pledgor described in clauses (i) through (iii) above and, to the extent related
to any property described in said clauses or such proceeds, all books,
correspondence, credit files, records, invoices and other papers.

               (b)  DELIVERY OF THE COLLATERAL. All certificates or instruments,
if any, representing or evidencing the Collateral shall be delivered to and held
by or on behalf of Lender pursuant hereto and shall be in suitable form for
transfer by delivery, or shall be accompanied by duly executed instruments of
transfer, stock powers endorsed by Pledgor in blank, or assignments in blank,
all in form and substance satisfactory to Lender. Upon the occurrence and during
the continuance of an Event of Default, Lender shall have the right, at any
time, in its discretion upon notice to Pledgor, to transfer to or to register in
the name of Lender or its nominee any or all of the Collateral. Prior to or
concurrently with the execution and delivery of this Agreement, Pledgor shall
deliver to Lender an assignment of membership interest endorsed by Pledgor in
blank (an "ASSIGNMENT OF INTEREST"), in the form set forth on EXHIBIT B hereto,
for the Laughlin Owner for the Pledged Interests, transferring all of such
Pledged Interests in blank, duly executed by Pledgor and undated. Lender shall
have the right, at any time in its discretion upon the occurrence and during the
continuance of an Event of Default and without notice to Pledgor, to transfer
to, and to designate on such Pledgor's Assignment of Interest, any Person to
whom the Pledged Interests are sold in accordance with the provisions hereof. In
addition, Lender shall have the right at any time to exchange any Assignment of
Interest representing or evidencing the Pledged Interests or any portion thereof
for one or more additional or substitute Assignments of Interest representing or
evidencing smaller or larger percentages of the Pledged Interests represented or
evidenced thereby, subject to the terms thereof.

               (c)  OBLIGATIONS UNCONDITIONAL. The obligations of Pledgor
hereunder are absolute and unconditional, irrespective of the value,
genuineness, validity, regularity or enforceability of the Mezzanine Loan
Agreement, the Guaranty, the Affiliate Notes, any other Affiliate Loan
Documents, or any other agreement or instrument referred to herein or therein,
or any substitution, release or exchange of any guarantee of or security for any
of the Obligations, and, to the fullest extent permitted by applicable law,
irrespective of any other circumstance whatsoever which might otherwise
constitute a legal or equitable discharge or defense of a surety or Pledgor, it
being the intent of this SECTION 2(c) that the obligations of Pledgor hereunder
shall be absolute and unconditional under any and all circumstances. Without
limiting the generality of the foregoing, it is agreed that the occurrence of
any one or more of the following shall not affect the liability of Pledgor
hereunder:

                    (i)     at any time or from time to time, without notice to
Pledgor, the time for any performance of or compliance with any of the
Obligations shall be extended, or such performance or compliance shall be
waived;

                    (ii)    any of the acts mentioned in any of the provisions
of the

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Mezzanine Loan Agreement, the Guaranty, the Affiliate Notes, any other
Affiliate Loan Documents, or any other agreement or instrument referred to
herein or therein shall be done or omitted;

                    (iii)   the maturity of any of the Obligations shall be
accelerated, or any of the Obligations shall be modified, supplemented or
amended in any respect, or any right under the Mezzanine Loan Agreement, the
Guaranty, the Affiliate Notes, any other Affiliate Loan Documents, or any other
agreement or instrument referred to herein or therein shall be waived or any
other guarantee of any of the Obligations or any security or collateral therefor
shall be terminated, released or exchanged in whole or in part or otherwise
dealt with; or

                    (iv)    any lien or security interest granted to, or in
favor of Lender as security for any of the Obligations shall fail to be
perfected or shall be released.

          3.   REINSTATEMENT. The obligations of Pledgor under this Agreement
shall be automatically reinstated if and to the extent that for any reason any
payment by or on behalf of Pledgor in respect of the Obligations is rescinded or
must be otherwise restored by any holder of any of the Obligations, whether as a
result of any proceedings in bankruptcy or reorganization or otherwise and
Pledgor agree that they will indemnify Lender on demand for all reasonable costs
and expenses (including, without limitation, fees of counsel) incurred by Lender
in connection with such rescission or restoration.

          4.   REPRESENTATIONS, WARRANTIES OF PLEDGOR. Pledgor represents,
warrants and covenants that:

               (a)  EXISTENCE. Pledgor: (a) is a limited liability company duly
organized and validly existing under the laws of Delaware; (b) has all requisite
power, and has all governmental licenses, authorizations, consents and approvals
necessary, to own its assets and carry on its business as now being or as
proposed to be conducted; and (c) is qualified to do business in all
jurisdictions in which the nature of the business conducted by it makes such
qualification necessary.

               (b)  LITIGATION. Except as disclosed to Lender in writing prior
to the date of this Agreement, there are no legal or arbitral proceedings or any
proceedings by or before any Governmental Authority or agency, now pending or
(to the knowledge of Pledgor) threatened against Pledgor, the Collateral and/or
the Company.

               (c)  NO BREACH. None of the execution and delivery of this Pledge
or any other Mezzanine Loan Document (including, without limitation, the
Affiliate Loan Documents) to which Pledgor is a party, the consummation of the
transactions herein or therein contemplated and compliance with the terms and
provisions hereof or thereof will conflict with or result in a breach of, or
require any consent (except such consents as have been obtained) under the
organizational documents of Pledgor or the Company, or any applicable law or
regulation, or any order, writ, injunction or decree of any court or
Governmental Authority, or any agreement or instrument to which Pledgor is a
party or by which it is bound or to which it is subject, or constitute a default
under any such agreement or instrument, or (except for the lien arising pursuant
to this Agreement) result in the creation or imposition of any lien upon any of
the revenues or assets of Pledgor pursuant to the

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terms of any such agreement or instrument.

               (d)  NECESSARY ACTION. Pledgor has all necessary power and
authority to execute, deliver and perform its obligations under this Agreement;
the execution, delivery and performance by Pledgor of this Agreement has been
duly authorized by all necessary action on its part; and this Agreement has been
duly and validly executed and delivered by Pledgor and constitutes its legal,
valid and binding obligation, enforceable in accordance with its terms, subject
to bankruptcy, insolvency, moratorium or other similar laws affecting the
enforcement of creditors' rights in general and to general principles of equity.

               (e)  APPROVALS. No authorizations, approvals and consents of, and
no filings and registrations with, any governmental or regulatory authority or
agency are necessary for (a) the execution, delivery or performance by Pledgor
of this Agreement or for the validity or enforceability thereof; (b) the grant
by Pledgor of the assignments and security interests granted hereby, or the
pledge by Pledgor of the Collateral pursuant hereto; (c) the perfection or
maintenance of the pledge, assignment and security interest created hereby
(including the first priority nature of such pledge, assignment and security
interest) except for the filing of financing statements under the Uniform
Commercial Code; or (d) the exercise by Lender of all rights and remedies in
respect of the Collateral pursuant to this Agreement.

               (f)  OWNERSHIP. Pledgor owns a 100% interest in the Company.
Pledgor has good and indefeasible title to, the Collateral, free and clear of
all pledges, liens, mortgages, hypothecations, security interests, charges,
options or other encumbrances whatsoever, except the lien and security interest
created by this Agreement. The Pledged Interests are not and will not be subject
to any contractual restriction upon the transfer thereof (except for any such
restrictions contained herein).

               (g)  PRINCIPAL PLACE OF BUSINESS AND STATE OF ORGANIZATION.
Pledgor will not change Pledgor's principal place of business or state of
organization unless Pledgor has previously notified Lender thereof and taken
such action as is necessary or reasonably requested by Lender to cause the
security interest of Lender in the Collateral to continue to be perfected.

               (h)  VALID SECURITY INTEREST. This Agreement creates a valid
security interest in the Collateral, securing the payment of the Obligations,
and upon the filing in the appropriate filing offices of the financing
statements to be delivered pursuant to this Agreement, such security interests
will be perfected, first priority security interests, and all filings and other
actions necessary to perfect such security interests will have been duly taken.

          5.   COVENANTS OF PLEDGOR.

               (a)  NO TRANSFER. Unless expressly permitted under the Mezzanine
Loan Agreement, Pledgor will not sell, assign, transfer, exchange, or otherwise
dispose of, or grant any option with respect to, the Collateral, nor will it
create, incur or permit to exist any pledge, lien, mortgage, hypothecation,
security interest, charge, option or any other encumbrance with respect to any
Collateral, or any interest therein, or any proceeds thereof, except for the
lien and security

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interest provided for by this Agreement.

               (b)  NO WAIVER, AMENDMENT, ETC. Pledgor shall not directly or
indirectly, without the prior written consent of Lender, attempt to waive,
alter, amend, modify, supplement or change in any way, or release, subordinate,
terminate or cancel in whole or in part, or give any consent under, any of the
instruments, documents, policies or agreements constituting the Collateral or
any of the rights or interests of Pledgor as party, holder, mortgagee or
beneficiary thereunder. Pledgor agrees that all rights to do any and all of the
foregoing have been assigned to Lender, but Pledgor agrees that, upon request
from Lender from time to time, Pledgor shall do any of the foregoing or shall
join Lender in doing so or shall confirm the right of Lender to do so and shall
execute such instruments and undertake such actions as Lender may reasonably
request in connection therewith.

               (c)  SETTLEMENT AND RELEASE. Pledgor shall not make any election,
compromise, adjustment or settlement in respect of any of the Collateral.

               (d)  PRESERVATION OF COLLATERAL. Lender may, in its discretion,
for the account and expense of Pledgor pay any amount or do any act required of
Pledgor hereunder or requested by Lender to preserve, protect, maintain or
enforce the Obligations, the Collateral or the security interests granted
herein, provided Pledgor has failed to pay such amount or take such action
within ten (10) days after written demand by Lender. Any such payment shall be
deemed an advance by Lender to Pledgor and shall be payable by such Pledgor
within ten (10) days after written demand together with interest thereon at the
Default Rate from the date expended by Lender until paid.

               (e)  WARRANTY OF TITLE. Pledgor shall warrant and defend the
right, title and interest of Lender in and to the Collateral and the proceeds
thereof against the claims and demands of all persons whomsoever.

               (f)  FILES AND RECORDS. Pledgor shall maintain, at their
principal office, and, upon request, make available to Lender the originals, or
copies in any case where the originals have been delivered to Lender of the
instruments, documents, policies and agreements constituting the Collateral (to
the extent not held by Lender) and related documents and instruments, and all
files, surveys, certificates, correspondence, appraisals, computer programs,
tapes, discs, cards, accounting records and other information and data relating
to the Collateral.

               (g)  LITIGATION. Pledgor shall promptly give to Lender notice of
all pending legal or arbitration proceedings, and of all proceedings pending by
or before any governmental or regulatory authority or agency, affecting Pledgor
or any Owner.

               (h)  EXISTENCE, ETC. Pledgor shall and shall cause the Laughlin
Owner to preserve and maintain its existence and all of its material rights,
privileges and franchises. Pledgor shall comply and cause the Laughlin Owner to
comply with the requirements of all applicable laws, rules, regulations and
orders of governmental or regulatory authorities; and pay and discharge or cause
the Laughlin Owner to pay or discharge all taxes, assessments and governmental
charges or levies imposed on them or on their income or profits or on any of
their property prior to the date on

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which penalties attach thereto, except for any such tax, assessment, charge or
levy the payment of which is being contested in good faith and by proper
proceedings.

               (i)  CHARTER DOCUMENTS. Pledgor shall, at its expense:

                    (i)     perform and observe all the terms and provisions of
the Charter Documents to be performed or observed by it, maintain the Charter
Documents in full force and effect, enforce the Charter Documents in accordance
with their respective terms, and to take all such action to such end as may be
from time to time reasonably requested by Lender; and

                    (ii)    furnish to Lender promptly upon receipt thereof
copies of all notices, requests and other documents received by Pledgor under or
pursuant to the Charter Documents, and from time to time furnish to Lender such
information and reports regarding the Collateral as Lender may reasonably
request.

               (j)  FINANCING STATEMENTS. Pledgor hereby (a) authorizes Lender
to execute and file at any time or times, one or more UCC-1 financing statements
covering the Collateral and UCC assignment financing statements assigning the
UCC-1 financing statements which constitute part of the Collateral; and (b)
appoint Lender as their agent and attorney-in-fact to execute in the name of
Pledgor any UCC financing statement or amendment, or collateral assignment of
any instrument, document, policy or agreement constituting the Collateral or
other instrument or filing or recordation to perfect or continue the perfection
of the security interest so long as any Obligation remains unpaid.

          6.   FURTHER ASSURANCES; REMEDIES. In furtherance of the grant of the
pledge and security interest pursuant to SECTION 2 hereof, Pledgor hereby agrees
with Lender as follows:

               (a)  DELIVERY AND OTHER PERFECTION. Pledgor shall:

                    (i)     f any of the above-described Collateral required to
be pledged by Pledgor under SECTION 2(a) hereof are received by Pledgor,
forthwith either (x) transfer and deliver to Lender such Collateral so received
by Pledgor (together with the certificates (if any) for any such Collateral,
including assignments duly endorsed in blank and accompanied in the case of
shares by undated stock powers duly executed in blank) all of which thereafter
shall be held by Lender, pursuant to the terms of this Agreement, as part of the
Collateral or (y) take such other action as Lender shall deem reasonably
necessary or appropriate to duly record the lien created hereunder in such
Collateral referred to in said SECTION 2(a);

                    (ii)    give, execute, deliver, file and/or record any
financing statement, notice, instrument, document, agreement or other papers
that may be necessary or desirable (in the reasonable judgment of Lender) to
create, preserve, perfect or validate the security interest granted pursuant
hereto or to enable Lender to exercise and enforce its rights hereunder with
respect to such pledge and security interest, including, without limitation,
causing any or all of the Collateral to be transferred of record into the name
of Lender or its nominee (and Lender agrees that if any Collateral is
transferred into its name or the name of its nominee, Lender will thereafter

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promptly give to Pledgor copies of any notices and communications received by it
with respect to the Collateral); and

                    (iii)   permit representatives of Lender, upon reasonable
notice, at any time during normal business hours to inspect and make abstracts
from its books and records pertaining to the Collateral, and permit
representatives of Lender to be present at Pledgor's place of business to
receive copies of all communications and remittances relating to the Collateral,
and forward copies of any notices or communications received by Pledgor with
respect to the Collateral, all in such manner as Lender may reasonably require.

               (b)  PRESERVATION OF RIGHTS. Except in accordance with applicable
law, Lender shall not be required to take steps necessary to preserve any rights
against prior parties to any of the Collateral.

               (c)  PLEDGED COLLATERAL.

                    (i)     Pledgor shall not and shall not have the right to
directly or indirectly, without the prior written consent of Lender, attempt to
waive, alter, amend, modify, supplement or change in any way, or release,
subordinate, terminate or cancel in whole or in part, or give any consent under,
any of the instruments, documents, policies or agreements constituting the
Collateral or exercise any of the rights, options or interests of Pledgor as
party, holder, mortgagee or beneficiary thereunder except as otherwise expressly
permitted under the Mezzanine Loan Agreement. Pledgor agrees that all rights to
do any and all of the foregoing have been assigned to and may be exercised by
Lender but Pledgor agrees that, upon request from Lender from time to time,
Pledgor shall do any of the foregoing or shall join Lender in doing so or shall
confirm the right of Lender to do so and shall execute such instruments and
undertake such actions as Lender may request in connection therewith. Pledgor
shall not make any election, compromise, adjustment or settlement in respect of
any of the Collateral. Notwithstanding anything herein to the contrary, so long
as no Event of Default shall have occurred and be continuing, Pledgor shall have
the right to exercise all of Pledgor's rights under the Charter Documents to
which it is a party for all purposes not inconsistent with any of the terms of
this Agreement, the Mezzanine Loan Agreement or any other Mezzanine Loan
Document (including, without limitation, the Affiliate Loan Documents) or any
other instrument or agreement referred to herein or therein, provided that
Pledgor agrees that it will not take any action in any manner that is
inconsistent with the terms of this Agreement, the Mezzanine Loan Agreement or
any other Mezzanine Loan Document (including, without limitation, the Affiliate
Loan Documents) or any such other instrument or agreement. Lender shall execute
and deliver to Pledgor or cause to be executed and delivered to Pledgor all such
proxies, powers of attorney, distribution and other orders, and all such
instruments, without representation, recourse or warranty, as Pledgor may
reasonably request for the purpose of enabling Pledgor to exercise the rights
and powers which it is entitled to exercise pursuant to this SECTION 6(c).

                    (ii)    Anything to the contrary notwithstanding, (i)
Pledgor shall remain liable under the Charter Documents to perform all of their
duties and obligations thereunder to the same extent as if this Agreement had
not been executed, (ii) the exercise by Lender of any of the rights hereunder
shall not release Pledgor from any of their duties or obligations under the

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Charter Documents, and (iii) Lender shall have no obligation or liability under
the Charter Documents by reason of this Agreement, nor shall Lender be obligated
to perform any of the obligations or duties of Pledgor thereunder or to take any
action to collect or enforce any claim for payment assigned hereunder.

               (d)  EVENTS OF DEFAULT, ETC. During the period during which an
Event of Default shall have occurred and be continuing:

                    (i)     Lender shall have all of the rights and remedies
with respect to the Collateral of a secured party under the Uniform Commercial
Code (whether or not said Code is in effect in the jurisdiction where the rights
and remedies are asserted) and such additional rights and remedies to which a
secured party is entitled under the laws in effect in any jurisdiction where any
rights and remedies hereunder may be asserted, including, without limitation,
the right, to the maximum extent permitted by law, to exercise all voting,
consensual and other powers of ownership pertaining to the Collateral as if
Lender were the sole and absolute owner thereof (and Pledgor agrees to take all
such action as may be appropriate to give effect to such right);

                    (ii)    Lender in its discretion may, in its name or in the
name of Pledgor or otherwise, demand, sue for, collect or receive any money or
property at any time payable or receivable on account of or in exchange for any
of the Collateral, but shall be under no obligation to do so;

                    (iii)   Lender may, at its option, apply all or any part of
the Collateral to the Obligations in such order and priority as shall be
selected by Lender;

                    (iv)    Lender may, upon ten (10) days' prior written notice
to Pledgor of the time and place, with respect to the Collateral or any part
thereof which shall then be or shall thereafter come into the possession,
custody or control of Lender or any of its agents, sell, assign or otherwise
dispose of all or any part of such Collateral, at such place or places as Lender
deems best, and for cash or on credit or for future delivery (without thereby
assuming any credit risk), at public or private sale, without demand of
performance or notice of intention to effect any such disposition or of time or
place thereof (except such notice as is required above or by applicable statute
and cannot be waived) and Lender or anyone else may be the purchaser, assignee
or recipient of any or all of the Collateral so disposed of at any public sale
(or, to the extent permitted by law, at any private sale), and thereafter hold
the same absolutely, free from any claim or right of whatsoever kind, including
any right or equity of redemption (statutory or otherwise), of Pledgor, any such
demand, notice or right and equity being hereby expressly waived and released.
Unless prohibited by applicable law, Lender may, without notice or publication,
adjourn any public or private sale or cause the same to be adjourned from time
to time by announcement at the time and place fixed for the sale, and such sale
may be made at any time or place to which the same may be so adjourned;

                    (v)     Lender may exercise all membership rights, powers
and privileges to the same extent as Pledgor is entitled to exercise such
rights, powers and privileges;

                    (vi)    Lender may accelerate the indebtedness secured
hereby;

                                       474
<Page>

                    (vii)   Lender may, in connection with a sale of the Pledged
Interests, cause each purchaser of all or any part of any Pledged Interests to
be admitted as a new member or owner of the Company to the extent of such
Pledged Interests, and cause Pledgor to withdraw as a member or owner of such
Company to the extent such Pledged Interests are sold, and complete by inserting
the Effective Date (as defined therein) and the name of the assignee thereunder
and deliver to such assignee each Assignment of Interest executed and delivered
by Pledgor and, if appropriate, cause one or more amended or restated
certificates of limited partnership, certificates of limited liability company
or articles of incorporation to be filed with respect to the Company;

                    (viii)  Lender may exercise any and all rights and remedies
of Pledgor under or in connection with the Charter Documents or otherwise in
respect of the Collateral, including, without limitation, any and all rights of
Pledgor to demand or otherwise require payment of any amount under, or
performance of any provisions of, the Charter Documents; and

                    (ix)    all payments received, directly or indirectly, by
Pledgor under or in connection with the Charter Documents or otherwise in
respect of the Collateral shall be received in trust for the benefit of Lender,
shall be segregated from other funds of Pledgor and shall be forthwith paid over
to Lender in the same form as so received (with any necessary endorsement).

The proceeds of each collection, sale or other disposition under this SECTION
6(d) shall be applied by Lender to the Obligations pursuant to SECTION 6(f)
hereof.

Pledgor recognizes that, by reason of certain prohibitions contained in the
Securities Act of 1933, as amended, and applicable state securities laws, Lender
may be compelled, with respect to any sale of all or any part of the Collateral,
to limit purchasers to those who will agree, among other things, to acquire the
Collateral for their own account, for investment and not with a view to the
distribution or resale thereof. Pledgor acknowledges that any such private sales
may be at prices and on terms less favorable to Lender than those obtainable
through a public sale without such restrictions, and, notwithstanding such
circumstances, agrees that any such private sale shall be deemed to have been
made in a commercially reasonable manner and that Lender shall have no
obligation to engage in public sales and no obligation to delay the sale of any
Collateral for the period of time necessary to permit the issuer thereof to
register it for public sale.

               (e)  PRIVATE SALE. Lender shall not incur any liability as a
result of the sale of the Collateral, or any part thereof, at any private sale
pursuant to SECTION 6(d) hereof conducted in a commercially reasonable manner.
Pledgor hereby waives any claims against Lender arising by reason of the fact
that the price at which the Collateral may have been sold at such a private sale
was less than the price which might have been obtained at a public sale or was
less than the aggregate amount of the Obligations, even if Lender accepts the
first offer received and does not offer the Collateral to more than one offeree.

               (f)  APPLICATION OF PROCEEDS. Except as otherwise herein
expressly provided, the proceeds of any collection, sale or other realization of
all or any part of the Collateral pursuant hereto, and any other cash at the
time held by Lender under this SECTION 6, shall be applied

                                       475
<Page>

by Lender:

                    FIRST, to the payment of the costs and expenses of such
               collection, sale or other realization, including reasonable
               out-of-pocket costs and expenses of Lender and the fees and
               expenses of their respective agents and counsel, and all
               expenses, and advances made or incurred by Lender in connection
               therewith;

                    NEXT, to the payment in full of the Obligations; and

                    FINALLY, to the payment to Pledgor, or its successors or
               assigns, or as a court of competent jurisdiction may direct, of
               any surplus then remaining.

As used in this SECTION 6, "PROCEEDS" of Collateral shall mean cash, securities
and other property realized in respect of, and distributions in kind of,
Collateral, including any thereof received under any reorganization, liquidation
or adjustment of debt of Pledgor or any issuer of or obligor on any of the
Collateral.

               (g)  ATTORNEY-IN-FACT. Without limiting any rights or powers
granted by this Agreement to Lender while no Event of Default has occurred and
is continuing, upon the occurrence and during the continuance of any Event of
Default Lender is hereby appointed the attorney-in-fact of Pledgor for the
purpose of carrying out the provisions of this SECTION 6 and taking any action
and executing any instruments which Lender may deem necessary or advisable to
accomplish the purposes hereof, which appointment as attorney-in-fact is
irrevocable and coupled with an interest. Without limiting the generality of the
foregoing, so long as Lender shall be entitled under this SECTION 6 to make
collections in respect of the Collateral, Lender shall have the right and power
to receive, endorse and collect all checks made payable to the order of Pledgor
representing any payment or other distribution in respect of the Collateral or
any part thereof and to give full discharge for the same.

               (h)  ENFORCEMENT EXPENSES. Pledgor agrees to pay to Lender all
out-of-pocket expenses (including reasonable expenses for legal services of
every kind) of, or incident to, the enforcement of any of the provisions of this
SECTION 6, or performance by Lender of any obligations of Pledgor in respect of
the Collateral which Pledgor has failed or refused to perform, or any actual or
attempted sale, or any exchange, enforcement, collection, compromise or
settlement in respect of any of the Collateral, and for the care of the
Collateral and defending or asserting rights and claims of Lender in respect
thereof, by litigation or otherwise and all such expenses shall be Obligations
to Lender secured under SECTION 2 hereof.

          7.   TERMINATION. Upon the payment and performance in full of all
Obligations, this Agreement shall terminate and Lender shall forthwith cause to
be assigned, transferred and delivered, against receipt but without any
recourse, warranty or representation whatsoever, any remaining Collateral and
money received in respect thereof, to or on the order of Pledgor.

          8.   MISCELLANEOUS.

                                       476
<Page>

               (a)  NO WAIVER. No failure on the part of Lender or any of its
agents to exercise, and no course of dealing with respect to, and no delay in
exercising, any right, power or remedy hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise by Lender or any of its agents
of any right, power or remedy hereunder preclude any other or further exercise
thereof or the exercise of any other right, power or remedy. The remedies
provided herein are cumulative and are not exclusive of any remedies provided by
law.

               (b)  GOVERNING LAW.

                    (i)     THIS AGREEMENT WAS NEGOTIATED IN THE STATE OF NEW
YORK, AND MADE BY PLEDGOR AND ACCEPTED BY LENDER IN THE STATE OF NEW YORK, AND
THE PROCEEDS OF THE AFFILIATE NOTES SECURED HEREBY WERE DISBURSED FROM THE STATE
OF NEW YORK, WHICH STATE THE PARTIES AGREE HAS A SUBSTANTIAL RELATIONSHIP TO THE
PARTIES AND TO THE UNDERLYING TRANSACTION EMBODIED HEREBY, AND IN ALL RESPECTS,
INCLUDING, WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS AGREEMENT AND THE OBLIGATIONS
ARISING HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH
STATE (WITHOUT REGARD TO PRINCIPLES OF CONFLICT LAWS) AND ANY APPLICABLE LAW OF
THE UNITED STATES OF AMERICA. TO THE FULLEST EXTENT PERMITTED BY LAW, PLEDGOR
HEREBY UNCONDITIONALLY AND IRREVOCABLY WAIVES ANY CLAIM TO ASSERT THAT THE LAW
OF ANY OTHER JURISDICTION GOVERNS THIS AGREEMENT OR THE OTHER MEZZANINE LOAN
DOCUMENTS (INCLUDING, WITHOUT LIMITATION, THE AFFILIATE LOAN DOCUMENTS), AND
THIS AGREEMENT AND THE OTHER MEZZANINE LOAN DOCUMENTS (INCLUDING, WITHOUT
LIMITATION, THE AFFILIATE LOAN DOCUMENTS) SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK PURSUANT TO SECTION 5-1401 OF
THE NEW YORK GENERAL OBLIGATIONS LAW.

                    (ii)    ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST LENDER
OR PLEDGOR ARISING OUT OF OR RELATING TO THIS AGREEMENT MAY AT LENDER'S OPTION
BE INSTITUTED IN ANY FEDERAL OR STATE COURT IN THE CITY OF NEW YORK, COUNTY OF
NEW YORK, PURSUANT TO SECTION 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW,
AND PLEDGOR WAIVES ANY OBJECTIONS WHICH IT MAY NOW OR HEREAFTER HAVE BASED ON
VENUE AND/OR FORUM NON CONVENIENS OF ANY SUCH SUIT, ACTION OR PROCEEDING, AND
PLEDGOR HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH COURT IN ANY
SUIT, ACTION OR PROCEEDING. PLEDGOR DOES HEREBY DESIGNATE AND APPOINT:

               SCHIFF HARDIN & WAITE

                                       477
<Page>

               150  EAST 52ND STREET, SUITE 2700
               NEW YORK, NEW  YORK 10022
               ATTENTION: DAVID A. GROSSBERG, ESQ. (CHICAGO OFFICE)

AS ITS AUTHORIZED AGENT TO ACCEPT AND ACKNOWLEDGE ON ITS BEHALF SERVICE OF ANY
AND ALL PROCESS WHICH MAY BE SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING IN
ANY FEDERAL OR STATE COURT IN NEW YORK, NEW YORK, AND AGREES THAT SERVICE OF
PROCESS UPON SAID AGENT AT SAID ADDRESS AND WRITTEN NOTICE OF SAID SERVICE
MAILED OR DELIVERED TO PLEDGOR IN THE MANNER PROVIDED HEREIN SHALL BE DEEMED IN
EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON PLEDGOR IN ANY SUCH SUIT, ACTION
OR PROCEEDING IN THE STATE OF NEW YORK. PLEDGOR (I) SHALL GIVE PROMPT NOTICE TO
LENDER OF ANY CHANGED ADDRESS OF ITS AUTHORIZED AGENT HEREUNDER, (II) MAY AT ANY
TIME AND FROM TIME TO TIME DESIGNATE A SUBSTITUTE AUTHORIZED AGENT WITH AN
OFFICE IN NEW YORK, NEW YORK (WHICH SUBSTITUTE AGENT AND OFFICE SHALL BE
DESIGNATED AS THE PERSON AND ADDRESS FOR SERVICE OF PROCESS), AND (III) SHALL
PROMPTLY DESIGNATE SUCH A SUBSTITUTE IF ITS AUTHORIZED AGENT CEASES TO HAVE AN
OFFICE IN NEW YORK, NEW YORK OR IS DISSOLVED WITHOUT LEAVING A SUCCESSOR.

               (c)  NOTICES. All notices, consents, approvals and requests
required or permitted hereunder shall be given in the manner and to the
addresses set forth in the Mezzanine Loan Agreement.

               (d)  WAIVERS, ETC. The terms of this Agreement may be waived,
altered or amended only by an instrument in writing duly executed by Pledgor and
Lender. Any such amendment or waiver shall be binding upon Lender and Pledgor.

               (e)  SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon
the successors and assigns of Pledgor and inure to the benefit of the successors
and assigns of Lender (PROVIDED, HOWEVER, that Pledgor shall not assign or
transfer its rights hereunder without the prior written consent of Lender).
Without limiting the foregoing, Lender may at any time and from time to time
without the consent of Pledgor, assign or otherwise transfer all or any portion
of its rights and remedies under this Agreement to any other person or entity,
either separately or together with other property of Pledgor for such purposes
in connection with a transfer of Lender's interest in the other Mezzanine Loan
Documents (including, without limitation, the Affiliate Loan Documents) and on
such terms as Lender shall elect, and such other person or entity shall
thereupon become vested with all of the rights and obligations in respect
thereof granted to Lender herein or otherwise. Without limiting the foregoing,
in connection with any assignment of the Loan, Lender may assign or otherwise
transfer all of its rights and remedies under this Agreement to the assignee and
such assignee shall thereupon become vested with all of the rights and
obligations in respect thereof granted to Lender herein or otherwise. Each
representation and agreement made by Pledgor in this Agreement shall be deemed
to run to, and each reference in this Agreement to Lender shall be

                                       478
<Page>

deemed to refer to, Lender and each of its successors and assigns.

               (f)  EXPENSES, INDEMNIFICATION.

                    (i)     Pledgor agrees to pay or reimburse Lender for
paying: (1) all reasonable out-of-pocket expenses of Lender (including, without
limitation, the reasonable fees and expenses of counsel to Lender), in
connection with (A) the negotiation, preparation, execution and delivery of this
Agreement and (B) any amendment, modification or waiver of any of the terms of
this Agreement requested or initiated by Pledgor; (2) all costs and expenses of
Lender (including reasonable counsel's fees) in connection with any Event of
Default and any enforcement or collection proceedings resulting therefrom; and
(3) all transfer, stamp, documentary or other similar taxes, assessments or
charges levied by any governmental or revenue authority in respect of this
Agreement, or any other document referred to herein and all costs, expenses,
taxes, assessments and other charges incurred in connection with any filing,
registration, recording or perfection of any security interest contemplated by
this Agreement or any document referred to herein.

                    (ii)    Pledgor hereby agrees to indemnify Lender and its
directors, officers, employees and agents from, and hold each of them harmless
against, any and all losses, liabilities, claims, damages or expenses incurred
by any of them arising out of or by reason of any claim of any Person (1)
relating to or arising out of the acts or omissions of Pledgor under this
Agreement or the Charter Documents (but excluding any such losses, liabilities,
claims, damages or expenses incurred by reason of the gross negligence or
willful misconduct of the Person to be indemnified), or (2) resulting from the
ownership of or lien on any Collateral, including, without limitation, the
reasonable fees and disbursements of counsel incurred in connection with any
such investigation or litigation or other proceedings (but excluding any such
losses, liabilities, claims, damages or expenses incurred by reason of the gross
negligence or willful misconduct of the Person to be indemnified).

               (g)  NO LIABILITY ON PART OF LENDER. Lender, by its acceptance of
this Agreement, the Collateral and any payments on account thereof, shall not be
deemed to have assumed or to have become liable for any of the obligations or
liabilities of Pledgor. Lender shall have no duty to collect any sums due in
respect of any of the Collateral in its possession or control, or to enforce,
protect or preserve any rights pertaining thereto, and Lender shall not be
liable for failure to collect or realize upon the Collateral, or any part
thereof, or for any delay in so doing, nor shall Lender be under any obligation
to take any action whatsoever with regard thereto. Lender shall, if requested by
the payor of any revenue payment, give receipts for any payments received by
Lender on account of the Collateral.

               (h)  FURTHER ASSURANCES. Pledgor agrees that, from time to time
upon the written request of Lender, Pledgor will execute and deliver such
further documents and do such other acts and things as Lender may reasonably
request in order fully to effect the purposes of this Agreement and the Guaranty
contained herein.

               (i)  DELAY NOT A WAIVER. Neither any failure nor any delay on the
part of Lender in insisting upon strict performance of any term, condition,
covenant or agreement, or

                                       479
<Page>

exercising any right, power, remedy or privilege hereunder, shall operate as or
constitute a waiver thereof, nor shall a single or partial exercise thereof
preclude any other future exercise, or the exercise of any other right, power,
remedy or privilege.

               (j)  COUNTERPARTS. This Agreement may be executed in any number
of counterparts, all of which taken together shall constitute one and the same
instrument and any of the parties hereto may execute this Agreement by signing
any such counterpart.

               (k)  SEVERABILITY. If any provision hereof is invalid and
unenforceable in any jurisdiction, then, to the fullest extent permitted by law,
(i) the other provisions hereof shall remain in full force and effect in such
jurisdiction and shall be liberally construed in favor of Lender in order to
carry out the intentions of the parties hereto as nearly as may be possible and
(ii) the invalidity or unenforceability of any provision hereof in any
jurisdiction shall not affect the validity or enforceability of such provision
in any other jurisdiction.

               (l)  LIMITATION OF LIABILITY. The liability of Pledgor hereunder
shall be subject to the provisions of SECTION 11.22 of the Mezzanine Loan
Agreement.

          9.   SUBORDINATION TO FIRST PLEDGE. This Agreement is, to the extent
set forth herein, subject and subordinate to the First Pledge securing the
Laughlin Note. The present beneficiary of the First Pledge is Lender. To the
extent that the claims of the present or any future beneficiary of the First
Pledge are legally prior in right to the rights of Lender hereunder, the rights
of Lender hereunder are subject and subordinate to the rights of such
beneficiary or beneficiaries of the First Pledge. Pledgor further agrees that
the First Pledge will not be amended, extended, increased, readvanced or
refinanced without the prior written consent of Lender and will continue to be
paid in accordance with the terms set forth in the copy of the First Pledge
which was furnished to Lender immediately prior to the execution of this
Agreement.

          10.  GUARANTY.

          (a)  UNCONDITIONAL GUARANTY. Pledgor unconditionally guarantees (i)
payment and performance of the Obligations, (ii) payment of any additional
amounts advanced by Lender pursuant to the provisions of this Agreement,
together with interest thereon at the rate provided therein, (iii) payment of
all expenses incurred by Lender and, to the extent reasonable, its counsel, in
connection with the administration or enforcement of each of the Affiliate
Loans, and (iv) any and all costs (including reasonable attorneys' fees)
incurred in enforcing the guaranty of the Obligations of Pledgor hereunder.

          (b)  JOINT AND SEVERAL OBLIGATIONS. Pledgor's obligations hereunder
are joint and several with any other guarantor now or hereafter guaranteeing the
Obligations under the documents evidencing and/or securing each of the Affiliate
Loans and are independent of the obligations of each Affiliate Pledgor under the
documents evidencing and/or securing each of the Affiliate Loans. A separate
action or actions may be brought and prosecuted against Pledgor, whether or not
action is brought against each Affiliate Pledgor under each of the Affiliate
Notes, respectively, or any other guarantor or whether or not the Pledgor
thereunder or any other guarantor are joined in such action or

                                       480
<Page>

actions.

          (c)  NOT A COLLECTION GUARANTY. This Guaranty is a guaranty of payment
and not of collection. Pledgor waives any right to require Lender at any time to
(a) proceed against each Affiliate Pledgor or any other guarantors under each of
the Affiliate Loans, (b) proceed against or exhaust any security held from each
of the Affiliate Pledgors under the Affiliate Loans, or (c) pursue any other
remedy in Lender's power whatsoever.

          (d)  CHANGE IN TERMS OF LOAN. Pledgor authorizes Lender, without
notice or demand and without affecting Pledgor's liability hereunder, from time
to time to renew, compromise, extend, accelerate or otherwise change the time
for payment or the terms of each of the Affiliate Loans or any part thereof,
including an increase or decrease of the rate of interest thereon.

          (e)  CONSENT TO RELEASES. Pledgor consents, without notice to Pledgor,
(i) to the release of all or any part of the security for each of the Affiliate
Loans, (ii) to the release of any party liable for each of the Affiliate Loans,
and (iii) to the release of any other guarantor from the obligations, or
portions thereof, guaranteed hereby.

          (f)  BANKRUPTCY OF AN AFFILIATE PLEDGOR. Neither Pledgor's obligation
to make payment in accordance with the terms of this guaranty nor any remedy for
the enforcement hereof shall be impaired, modified, changed, released or limited
in any manner whatsoever by the bankruptcy of an Affiliate Pledgor under each of
the Affiliate Loans or by any impairment, modification, change, release or
limitation of (i) the liability of an Affiliate Pledgor, any party assuming the
obligations of such Pledgor under each of the Affiliate Loans, or such Pledgor's
estate in bankruptcy, or (ii) any remedy for the enforcement of each of the
Affiliate Loans, either of which result from the operation of any present or
future provision of the Bankruptcy Reform Act of 1978 or other statute, or from
the decision of any court.

          (g)  VALID AND BINDING GUARANTY. Pledgor's execution, delivery,
observance and performance of this guaranty do not and will not conflict with or
result in a breach of the terms or provisions of any existing rule, regulation
or order of any court or governmental body or of any indenture, agreement or
instrument to which Pledgor is a party, or by which Pledgor is bound, or to
which Pledgor is subject, or constitute a default thereunder. This guaranty has
been duly executed and delivered by Pledgor and constitutes a valid and binding
guaranty enforceable in accordance with its terms.

          (h)  WAIVER OF PLEDGOR'S DEFENSES. Pledgor waives any defense arising
by reason of any disability or other defense whatsoever of the liability of an
Affiliate Pledgor under each of the Affiliate Loans. Until all indebtedness of
each of the Affiliate Pledgors under each of the Affiliate Loans to Lender shall
have been paid in full, even though such indebtedness is in excess of Pledgor's
liability hereunder, Pledgor waives (a) any right of subrogation, (b) any right
to enforce any remedy which Lender now has or may hereafter have against any
Affiliate Pledgor under each of the Affiliate Loans, and (c) any benefit of, and
any right to participate in, any security now or hereafter held by Lender.
Pledgor also waives and renounces any and all homestead exemption rights against
the obligations hereunder and also waives all presentments, demands for
performance, notices of

                                       481
<Page>

nonperformance, protests, notices of protest, notices of dishonor, and notices
of acceptance of this guaranty.

          (i)  SUBORDINATION OF EACH AFFILIATE PLEDGOR'S INDEBTEDNESS. Any
indebtedness of each of the Affiliate Pledgors now or hereafter owed to or held
by Pledgor is hereby subordinated to the indebtedness of such Affiliate Pledgor
to Lender. Such indebtedness of each of the Affiliate Pledgors under each of the
Affiliate Loans, respectively, to Pledgor shall, if Lender so requests, be
collected, enforced and received by Pledgor as trustee for Lender and be paid
over to Lender on account of the indebtedness of such Affiliate Pledgor to
Lender, but without reducing or affecting in any manner the liability of Pledgor
under the other provisions of this guaranty.

          (j)  ACCELERATION UPON EVENT OF DEFAULT. At the option of Lender and
with or without demand or notice, all or any part of Pledgor's Obligations
hereunder shall become due and payable immediately upon the occurrence and
during the continuance of an Event of Default, as such term is defined in this
Pledge or any of the Affiliate Loan Documents.

          (k)  LENDER'S RIGHT TO ASSIGN. Lender may, without notice whatsoever
to anyone, sell, assign or transfer all of any Pledgor's or any Affiliate
Pledgor's indebtedness, obligations and liabilities or any part thereof. In such
event, each and every successive assignee, transferee or Lender of all or any
part of said indebtedness, obligation and liability shall have the right to
enforce this guaranty by suit or otherwise for the benefit of such assignee,
transferee or Lender as fully as if such assignee, transferee or Lender were
herein by name specifically given such rights, powers, and benefits; provided,
however, that Lender, shall have an unimpaired right to enforce this guaranty
for its benefit as to so much of said indebtedness, obligations and liabilities
that it has not sold, assigned or transferred.

          (l)  LIABILITY OF PLEDGOR. Pledgor's liability under this Agreement,
including this SECTION 10, shall be non-recourse.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       482
<Page>

     IN WITNESS WHEREOF, Pledgor has caused this Agreement to be duly executed
as of the day and year first above written.

                                             LAUGHLIN HOLDINGS LLC, a Delaware
                                              limited liability company

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

                                       483
<Page>

                                    EXHIBIT A

                                CHARTER DOCUMENTS

1.   Certificate of Formation filed on July 5, 2002.

2.   Limited Liability Company Agreement dated as of July 5, 2002.

                                       484
<Page>

                                    EXHIBIT B

                    FORM OF ASSIGNMENT OF MEMBERSHIP INTEREST

          ASSIGNMENT OF MEMBERSHIP INTEREST (this "ASSIGNMENT") dated as of
__________, made by LAUGHLIN HOLDINGS LLC, a Delaware limited liability company
(together with its successors and assigns, the "ASSIGNOR") to
_____________________ (the "ASSIGNEE").

                                    RECITALS

          The undersigned has entered into the Guarantor Pledge and Security
Agreement dated as of July ___, 2002 (such Agreement, as it may be amended or
otherwise modified from time to time, the "PLEDGE AGREEMENT") with UBS WARBURG
REAL ESTATE INVESTMENTS INC., a Delaware corporation (together with its
successors and assigns, the "LENDER"). Unless otherwise noted, terms defined in
the Pledge Agreement are used herein as defined therein.

          The Assignor is the sole equity member of Laughlin Outlet Center LLC
(the "COMPANY") existing under and evidenced by the Limited Liability Company
Agreement of the Company dated as of July 5, 2002 (such agreement, as it may be
amended, supplemented or otherwise modified from time to time, the "OPERATING
AGREEMENT"). Under the Operating Agreement, the Assignor has certain rights,
title and interest in and to the Company and the property and assets of the
Company (collectively, the "INTEREST").

          Lender has required that the Assignor shall have executed and
delivered this Assignment.

          NOW THEREFORE, in consideration of the premises and of the mutual
covenants and agreements contained herein, the parties hereto agree as follows:

     SECTION 1.  ASSIGNMENT AND ACCEPTANCE OF ASSIGNED INTEREST. As of the
Effective Date (as defined in SECTION 9), the Assignor hereby sells, transfers,
conveys and assigns (without recourse and, except as set forth herein,
representation or warranty) (collectively, the "ASSIGNMENT") to the Assignee all
of the Assignor's right, title and interest in and to the Interest and of its
rights under the Operating Agreement, including, without limitation, all its (a)
rights to receive moneys due and to become due under or pursuant to the
Operating Agreement, (b) rights to receive proceeds of any insurance, indemnity,
warranty or guaranty with respect to the Operating Agreement, (c) claims for
damages arising out of or for breach of or default under the Operating
Agreement, and (d) rights to perform thereunder and to compel performance, and
otherwise exercise all rights and remedies thereunder. The percentage interest
of the Assignor's right, title and interest in the Interest and of the
Assignor's rights under the Operating Agreement that are being assigned to the
Assignee pursuant to this Agreement are hereinafter referred to as the "ASSIGNED
INTEREST". The Assignee, upon the execution of this Assignment, hereby accepts
from the Assignor the Assigned Interest and agrees to become a successor member
of the Company in the place and stead of the Assignor to the extent of

                                       485
<Page>

the Assigned Interest and to be bound by the terms and provisions of the
Operating Agreement.

     SECTION 2.  CAPITAL ACCOUNT. On or prior to the Effective Date, the
Assignee shall notify each of the other members in the Company required to be so
notified under the terms of the Operating Agreement and thereafter, the portion
of all profits and losses, and all other items of income, gain, loss, deduction
or credit, allocable to the Assigned Interest shall be credited or charged, as
the case may be, to the Assignee and the Assignee shall be entitled to the
portion of all distributions, payments or other allocations payable in respect
of the Assigned Interest, regardless of the source of such distributions,
payments or other allocations or the date on which they were earned.

     SECTION 3.  REPRESENTATIONS AND WARRANTIES OF THE ASSIGNOR. The Assignor
represents to Lender, as of the date of this Assignment, and to Lender and the
Assignee as of the Effective Date, that:

            (a)  This Assignment has been duly executed and delivered by the
Assignor and is a valid and binding obligation of the Assignor, enforceable in
accordance with its terms, subject to applicable bankruptcy, insolvency and
similar laws affecting rights of creditors generally, and general principles of
equity; and

            (b)  The Assignor is the sole owner of the Assigned Interest free
and clear of any liens, except for the liens created by the Pledge Agreement.

     SECTION 4.  FILINGS. On or as soon as practicable after the Effective Date,
the Assignee shall file and record or cause to be filed and recorded with all
proper offices or agencies all documents and instruments required to effect the
terms herein, if any, including, without limitation, (a) this Assignment and (b)
any limited liability company and assumed or fictitious name certificate or
certificates and any amendments thereto.

     SECTION 5.  FUTURE ASSURANCES. Each of the Assignor and the Assignee
mutually agrees to cooperate at all times from and after the date hereof with
respect to any of the matters described herein, and to execute such further
deeds, bills of sale, assignments, releases, assumptions, notifications or other
documents as may be reasonably requested for the purpose of giving effect to,
evidencing or giving notice of the assignment evidenced hereby.

     SECTION 6.  SUCCESSORS AND ASSIGNS. This Assignment shall be binding upon,
and shall inure to the benefit of, the parties hereto and their respective
successors and assigns.

     SECTION 7.  MODIFICATION AND WAIVER. No supplement, modification, waiver or
termination of this Assignment or any provisions hereof shall be binding unless
executed in writing by all parties hereto and the original of such writing has
been delivered to Assignee.

     SECTION 8.  COUNTERPARTS. Any number of counterparts of this Assignment may
be executed. Each counterpart will be deemed to be an original instrument and
all counterparts taken together will constitute one agreement. Delivery of an
executed counterpart of a signature page to this Assignment by telecopier shall
be as effective as delivery of a manually executed counterpart of

                                       486
<Page>

this Assignment.

     SECTION 9.  EXECUTION; EFFECTIVE DATE. This Assignment will be binding and
effective and will result in the assignment of the Assigned Interest on the date
first written above (the "EFFECTIVE DATE").

     SECTION 10. GOVERNING LAW. This Assignment will be governed by the laws of
the State of New York.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       487
<Page>

     IN WITNESS WHEREOF, the parties hereto have caused this Assignment to be
executed and delivered.

                                             ASSIGNOR

                                             LAUGHLIN HOLDINGS LLC, a
                                             Delaware limited liability company

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

                                       488
<Page>

                                             ASSIGNEE

                                             ----------------------------

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

                                       489<Page>

                                  EXHIBIT 10.71

                      SUBORDINATE CASH MANAGEMENT AGREEMENT

                           Dated: as of July ___, 2002

                                  BY AND AMONG

            LAUGHLIN HOLDINGS LLC, MEDFORD HOLDINGS LLC AND WARRENTON
                                  HOLDINGS LLC,
                           collectively, as Borrowers

                                       AND

                    UBS WARBURG REAL ESTATE INVESTMENTS INC.,
                                    as Lender

                                       AND

                      WACHOVIA BANK, NATIONAL ASSOCIATION,
                                    as Agent

                                       490
<Page>

                      SUBORDINATE CASH MANAGEMENT AGREEMENT

          SUBORDINATE CASH MANAGEMENT AGREEMENT (this "AGREEMENT"), dated as of
July __, 2002, among LAUGHLIN HOLDINGS LLC, a Delaware limited liability company
("LAUGHLIN MEZZANINE BORROWER"), MEDFORD HOLDINGS LLC, a Delaware limited
liability company ("MEDFORD MEZZANINE BORROWER"), and WARRENTON HOLDINGS LLC, a
Delaware limited liability company ("WARRENTON MEZZANINE BORROWER"; and
Warrenton Mezzanine Borrower, together with Laughlin Mezzanine Borrower and
Medford Mezzanine Borrower, each a "BORROWER" and collectively, "BORROWERS"),
WACHOVIA BANK, NATIONAL ASSOCIATION, a national banking association ("AGENT"),
and UBS WARBURG REAL ESTATE INVESTMENTS INC., a Delaware corporation ("LENDER").

                              W I T N E S S E T H:

          WHEREAS, pursuant to a certain Mezzanine Loan Agreement (as the same
may be amended, modified or supplemented from time to time, the "MEZZANINE LOAN
AGREEMENT") dated as of the date hereof by and among Borrowers and Lender,
Lender has made a loan to (i) Laughlin Mezzanine Borrower in the principal
amount of up to $1,750,000.00 (the "LAUGHLIN MEZZANINE LOAN") (ii) Medford
Mezzanine Borrower in the principal amount of up to $1,000,000.00 (the "MEDFORD
MEZZANINE LOAN"), and (iii) Warrenton Mezzanine Borrower in the principal amount
of up to $750,000.00 (the "WARRENTON MEZZANINE LOAN"; and the Warrenton
Mezzanine Loan, together with the Laughlin Mezzanine Loan and the Medford
Mezzanine Loan, collectively, the "MEZZANINE LOAN");

          WHEREAS, capitalized terms not otherwise defined herein shall have the
meanings set forth in the Mezzanine Loan Agreement;

          WHEREAS, the Mezzanine Loan is secured by pledge and security
agreements (the "PLEDGES") encumbering Laughlin Mezzanine Borrower's ownership
interest in the Laughlin Owner ("LAUGHLIN OWNER"), Medford Mezzanine Borrower's
ownership interest in the Medford Owner ("MEDFORD OWNER"), and Warrenton
Mezzanine Borrower's ownership interest in the Warrenton Owner ("WARRENTON
OWNER"; and the Warrenton Owner together with Laughlin Owner and Medford Owner,
each an "OWNER" and collectively, "OWNERS");

          WHEREAS, pursuant to that certain Cash Management Agreement (the
"SENIOR CASH MANAGEMENT AGREEMENT") dated as of the date hereof, among Agent,
Owners, Horizon Group Properties, L.P. ("MANAGER") and Lender (in its capacity
as "SENIOR LENDER"), Agent has agreed to make disbursements of Gross Revenue and
any other amounts from time to time deposited in that certain "Deposit Account"
(including those certain "Accounts", referenced thereunder and defined therein
(collectively, the "SENIOR DEPOSIT ACCOUNTS"), as provided in the Senior Cash
Management Agreement and the other Senior Loan Documents, and to perform certain
other services as provided therein;

                                       491
<Page>

          WHEREAS, in connection with the execution and delivery of the
Mezzanine Loan Agreement, Lender and Borrowers desire to retain Agent to provide
the services described herein.

          NOW, THEREFORE, in consideration of the covenants herein contained and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:

I.   DEFINITIONS

          Capitalized terms not otherwise defined herein shall have the meaning
set forth in the Mezzanine Loan Agreement. As used herein, the following terms
shall have the following definitions:

          "ACCOUNT COLLATERAL" shall have the meaning set forth in Section 4.1.

          "ACCOUNTS" shall mean, collectively, the Subordinate Deposit Account,
the Lender Account and the Borrower Account, and any and all other similar
accounts established under the Mezzanine Loan Agreement, this Agreement or
pursuant to the other Loan Documents.

          "ACH SYSTEM" shall mean the automated clearinghouse system.

          "AGREEMENT" shall mean this Subordinate Cash Management Agreement by
and among Borrowers, Agent and Lender, as amended, supplemented or otherwise
modified from time to time.

          "BORROWER ACCOUNT" shall have the meaning set forth in Section 2.1(c).

          "CLEARING ACCOUNTS" shall have the meaning set forth the Senior Loan
Agreement.

          "DEBT SERVICE ACCOUNT" shall have the meaning set forth in Section
2.1(b).

          "ELIGIBLE ACCOUNT" shall mean a separate and identifiable account from
all other funds held by the holding institution that is either (i) an account or
accounts maintained with a federal or state-chartered depository institution or
trust company which complies with the definition of Eligible Institution or (ii)
a segregated trust account or accounts maintained with a federal or state
chartered depository institution or trust company acting in its fiduciary
capacity which, in the case of a state chartered depository institution or trust
company, is subject to regulations substantially similar to 12 C.F.R. Section
9.10(b), having in either case a combined capital and surplus of at least
$50,000,000 and subject to supervision or examination by federal and state
authority. An Eligible Account will not be evidenced by a certificate of
deposit, passbook or other instrument.

          "ELIGIBLE INSTITUTION" shall mean a depository institution insured by
the Federal Deposit Insurance Corporation the short term unsecured debt
obligations or commercial paper of which are rated at least A-1 by Standard &
Poor's Ratings Group, P-1 by Moody's Investors Service, Inc. and F-1+ by Fitch
IBCA, Inc. in the case of accounts in which funds are held for thirty (30) days
or less (or, in the case of letters of credit or accounts in which funds are
held for more than thirty (30)

                                       492
<Page>

days, the long term unsecured debt obligations of which are rated at least "AA"
by Fitch and S&P and "Aa2" by Moody's).

          "LAUGHLIN OWNER" shall have the meaning set forth in the Recitals
hereto.

          "LENDER ACCOUNT" shall have the meaning set forth in Section 2.1(b).

          "MANAGER" shall have the meaning set forth in the Recitals hereto.

          "MEDFORD OWNER" shall have the meaning set forth in the Recitals
hereto.

          "MEZZANINE PAYMENT ACCOUNT" shall have the meaning set forth in the
Senior Cash Management Agreement.

          "MONTHLY PAYMENT DATE" shall mean the eleventh (11th) day of every
calendar month occurring during the term of the Mezzanine Loan.

          "OWNERS" and "OWNER" shall have the meaning set forth in the Recitals
hereto.

          "OBLIGATIONS" shall have the meaning set forth in Section 4.1.

          "PERMITTED INVESTMENTS" shall (i) prior to a Secondary Market
Transaction, mean any investment suitable for the investment of escrows and
reserves established under mortgage loans included in a Secondary Market
Transaction in which some or all of the Securities issued are rated "AAA" (or
the equivalent rating) by the Rating Agencies, as the standards therefor are
established from time to time, or such investments which are otherwise
acceptable to Lender, and (ii) from and after a Secondary Market Transaction,
have the meaning given to such term in the Pooling and Servicing Agreement (or
equivalent document) applicable to the Secondary Market Transaction.

          "SENIOR CASH MANAGEMENT AGREEMENT" shall have the meaning set forth in
the Recitals hereto.

          "SENIOR DEPOSIT ACCOUNTS" shall have the meaning set forth in the
Recitals hereto.

          "SENIOR LENDER" shall have the meaning set forth in the Recitals
hereto.

          "SUBORDINATE DEPOSIT ACCOUNT" shall have the meaning set forth in
Section 2.1(a).

          "UCC" shall have the meaning set forth in Section 4.1(a)(iv).

          "WARRENTON OWNER" shall have the meaning set forth in the Recitals
hereto.

II.  THE ACCOUNTS

          SECTION 2.1  ESTABLISHMENT OF ACCOUNTS. Borrowers acknowledge and
confirm that Borrowers have established the following Accounts with Agent:

                                       493
<Page>

          (a)  An account into which, on each Monthly Payment Date, Agent shall
transfer by wire transfer, via the ACH System or intrabank transfer all amounts
constituting available funds on deposit in the Mezzanine Payment Account (the
"SUBORDINATE DEPOSIT ACCOUNT");

          (b)  An account into which Agent shall deposit from the Subordinate
Deposit Account (i) the amounts required for the payment of the Laughlin
Mezzanine Monthly Debt Service Payment Amount, the Medford Mezzanine Monthly
Debt Service Payment Amount and the Warrenton Mezzanine Monthly Debt Service
Payment Amount (in such order and priority as Lender shall determine in its sole
discretion) and any other principal payment due on the next Monthly Payment
Date, together with any amounts due on account of any interest accruing at the
Default Rate and late payment charges (the "DEBT SERVICE ACCOUNT") and (ii) any
other amounts due to Lender pursuant to the Mezzanine Loan Documents (the
"LENDER ACCOUNT");

          (c)  An account into which Agent shall deposit, from the Subordinate
Deposit Account, the balance of funds, if any, remaining in the Subordinate
Deposit Account after payments to the Lender Account as set forth in clause (b)
above (the "BORROWER ACCOUNT");

          At Lender's, or Agent's or Servicer's election, any of the Accounts
may be established as subaccounts of the Subordinate Deposit Account on a
ledger-entry basis, in which event the term "Account" shall refer to any such
subaccount.

          SECTION 2.2  AGENT DEPOSITS INTO SUBORDINATE DEPOSIT ACCOUNT. Agent
represents, warrants and covenants that Agent shall cause all funds in the
Mezzanine Payment Account to be deposited directly into the Subordinate Deposit
Account on each Monthly Payment Date.

          SECTION 2.3  BORROWER COVENANTS. Each Borrower represents, warrants
and covenants that, other than the Senior Deposit Accounts, the Clearing
Accounts and the Accounts created pursuant to this Agreement, there are no other
accounts maintained by Borrowers, Owners, Manager or any other Person into which
revenues from the ownership and operation of the Properties are deposited. So
long as the Mezzanine Notes shall be outstanding, no Borrower, no Owner or any
other Person shall open any other such account for the deposit of Gross Revenue.

          SECTION 2.4  ACCOUNT NAME. The Accounts shall each be exclusively in
the name of Lender; provided, however, that in the event Lender transfers or
assigns the Mezzanine Loan, Agent, at Lender's request, shall change the name of
each Account to the name of the transferee or assignee. In the event Lender
retains a Servicer to service the Mezzanine Loan, Agent, at Lender's request,
shall comply with the instructions of Servicer, as agent for Lender.

          SECTION 2.5  ELIGIBLE ACCOUNTS/CHARACTERIZATION OF ACCOUNTS. Each
Account shall be maintained as an Eligible Account. Each Account is and shall be
treated either as a "securities account" as such term is defined in Section
8-501(a) of the UCC or a "deposit account" as defined in Section 9-102(a)(29) of
the UCC. Agent acknowledges and agrees that it shall notify Lender which
Accounts are intended to be deposit accounts and which Accounts are intended to
be securities accounts. Agent hereby agrees that each item of property (whether
investment property,

                                       494
<Page>

financial asset, securities, instrument, cash or other property) credited to
each Account shall be treated as a "financial asset" within the meaning of
Section 8-102(a)(9) of the UCC. Subject to the terms of this Agreement, Lender
shall be treated as having the right to exercise the rights with respect to any
financial asset credited to each Account, but subject to the terms of the
Mezzanine Loan Agreement. All securities or other property underlying any
financial assets credited to each Account shall be registered in the name of
Lender, indorsed to Lender or in blank or credited to another securities account
maintained in the name of Lender and in no case will any financial asset
credited to any Account be registered in the name of any Borrower, any Owner or
Manager, payable to the order of any Borrower, any Owner or Manager or specially
indorsed to any Borrower, any Owner or Manager.

          SECTION 2.6  PERMITTED INVESTMENTS. Sums on deposit in the Accounts
shall not be invested except in Permitted Investments. Lender shall have the
right to direct Agent to invest sums on deposit in the Accounts in Permitted
Investments; provided, however, in no event shall Agent make a Permitted
Investment if the maturity date of that Permitted Investment is later than the
date on which the invested sums are required for payment of an obligation for
which the Account (or applicable subaccount of the Subordinate Deposit Account)
was created. Each Borrower hereby irrevocably authorizes and directs Agent to
apply any income earned from Permitted Investments to the respective Accounts
(or applicable subaccount of the Subordinate Deposit Account). The amount of
actual losses sustained on a liquidation of a Permitted Investment shall be
deposited into the Subordinate Deposit Account by Borrowers no later than one
(1) Business Day following such liquidation. Each Borrower shall be responsible
for payment of any federal, state or local income or other tax applicable to
income earned from Permitted Investments. The Accounts relating to each
Individual Property shall be assigned the federal tax identification number of
the applicable Borrower, which number is (i) 02-0628567 for Laughlin Mezzanine
Borrower, (ii) 02-0628552 for Medford Mezzanine Borrower and (iii) 02-0628549
for Warrenton Mezzanine Borrower.

III. DEPOSITS/ALLOCATIONS/DISBURSEMENTS

          SECTION 3.1  DEPOSITS. Agent shall make such deposits into the
Accounts as and when required in accordance with Article 6 or any other
applicable provisions of the Mezzanine Loan Agreement.

          SECTION 3.2  ALLOCATIONS. Allocations from the Subordinate Deposit
Account into the other Accounts shall be made as and when required in accordance
with Section 6.3 or any other applicable provisions of the Mezzanine Loan
Agreement.

          SECTION 3.3  DISBURSEMENTS. Disbursements from the Accounts shall be
made as and when required in accordance with Article 6 or any other applicable
provisions of the Mezzanine Loan Agreement.

          SECTION 3.4  SOLE DOMINION AND CONTROL. Each Borrower acknowledges and
agrees that the Accounts (including any subaccounts thereof) are subject to the
sole dominion, control and discretion of Lender, its authorized agents or
designees, including Agent, subject to the terms hereof. Neither any Borrower
nor Manager shall have the right of withdrawal with respect to

                                       495
<Page>

any Account except with the prior written consent of Lender. Agent shall have
the right and agrees to comply with instructions originated by Lender with
respect to the disposition of funds in the Accounts without the further consent
of any Borrower or any other Person. Agent shall comply with all "entitlement
orders" (as defined in Section 8-102(a)(8) of the UCC) and instructions
originated by Lender directing the transfer or redemptions of any financial
asset relating to any Account without further consent by any Borrower or any
other Person.

IV.  PLEDGE OF ACCOUNTS

          SECTION 4.1  SECURITY FOR OBLIGATIONS. (a) To secure the full and
punctual payment and performance of all obligations of each Borrower now or
hereafter existing with respect to the Mezzanine Loan, whether for principal,
interest, fees, expenses or otherwise, and all obligations of each Borrower now
or hereafter existing under the Mezzanine Loan Agreement, the Mezzanine Notes,
the Pledges, this Agreement and all other Mezzanine Loan Documents (all such
obligations, collectively, the "Obligations"), each Borrower hereby grants to
Lender a first priority continuing security interest in and to the following
property of such Borrower, whether now owned or existing or hereafter acquired
or arising ad regardless of where located (all of the same, collectively, the
"Account Collateral"):

               (i)     the Accounts and all cash, checks, drafts, letters of
credit, certificates and instruments, if any, from time to time deposited or
held in the Accounts, including, without limitation, all deposits or wire
transfers made to the Accounts;

               (ii)    any and all Permitted Investments;

               (iii)   all interest, dividends, cash, instruments, investment
property and other property from time to time received, receivable or otherwise
payable in respect of, or in exchange for, any or all of the foregoing; and

               (iv)    to the extent not covered by clauses (i), (ii) or (iii)
above, all "proceeds" (as defined under the Uniform Commercial Code as in effect
in the State of New York (the "UCC")) of any or all of the foregoing.

          (b)  Lender and Agent, as agent for Lender, shall have with respect to
the Account Collateral, in addition to the rights and remedies herein set forth,
all of the rights and remedies available to a secured party under the UCC, as if
such rights and remedies were fully set forth herein.

          SECTION 4.2  RIGHTS ON DEFAULT. Upon the occurrence and during the
continuation of an Event of Default, Lender shall promptly notify Agent of such
Event of Default and, without notice from Agent or Lender, (a) no Borrower shall
have any further right in respect of (including, without limitation, the right
to instruct Lender or Agent to transfer from) the Accounts or any of the Account
Collateral, (b) Lender may direct Agent to liquidate and transfer any amounts
then invested in Permitted Investments to the Accounts or reinvest such amounts
in other Permitted Investments as Lender may reasonably determine is necessary
to perfect or protect any security interest granted or purported to be granted
hereby or to enable Agent, as agent for Lender, or Lender to exercise and
enforce Lender's rights and remedies hereunder with respect to any Account
Collateral, and (c)

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Lender may apply any Account Collateral to any Obligations in such order of
priority as Lender may determine in its sole and absolute discretion.

          SECTION 4.3    FINANCING  STATEMENT;  FURTHER ASSURANCES.
Simultaneously herewith, each Borrower shall deliver to Lender for filing a
financing statement or statements in connection with the Account Collateral in
the form required by Lender to properly perfect Lender's security interest
therein. Each Borrower agrees that at any time and from time to time, at the
expense of Borrowers, each Borrower will promptly execute and deliver all
further reasonable instruments and documents, and take all further action, that
may be necessary or desirable, or that Agent or Lender may reasonably request,
in order to perfect and protect any security interest granted or purported to be
granted hereby (including, without limitation, any security interest in and to
any Permitted Investments) or to enable Agent or Lender to exercise and enforce
its rights and remedies hereunder with respect to any Account Collateral.

          SECTION 4.4    TERMINATION OF AGREEMENT. This Agreement shall create a
continuing security interest in the Account Collateral and shall remain in full
force and effect until payment and performance in full of the Obligations. Upon
payment and performance in full of the Obligations, this Agreement shall
terminate and Borrowers shall be entitled to the return, upon their request and
at their expense, of such of the Account Collateral as shall not have been sold
or otherwise applied pursuant to the terms hereof, and Agent and/or Lender shall
execute such instruments and documents as may be reasonably requested by
Borrowers to evidence such termination and the release of the lien hereof.

V.   RIGHTS AND DUTIES OF LENDER AND AGENT

          SECTION 5.1    REASONABLE CARE. Beyond the exercise of reasonable care
in the custody thereof or as otherwise expressly provided herein, neither Agent
nor Lender shall have any duty as to any Account Collateral in its possession or
control as agent therefor or bailee thereof or any income thereon or the
preservation of rights against any Person or otherwise with respect thereto.
Agent and Lender each shall be deemed to have exercised reasonable care in the
custody and preservation of the Account Collateral in its possession if the
Account Collateral is accorded treatment substantially equal to that which Agent
or Lender accords its own property, it being understood that Lender shall not be
liable or responsible for any loss or damage to any of the Account Collateral,
or for any diminution in value thereof, by reason of the act or omission of
Agent or Lender, or their respective affiliates, agents, employees or bailees,
except to the extent that such loss or damage results from Agent's or Lender's
gross negligence or willful misconduct. Neither Lender nor Agent shall have any
liability for any loss resulting from the investment of funds in Permitted
Investments in accordance with the terms and conditions of this Agreement.

          SECTION 5.2    INDEMNITY. Agent, in its capacity as agent hereunder,
shall be responsible for the performance only of such duties as are specifically
set forth herein, and no duty shall be implied from any provision hereof. Agent
shall not be under any obligation or duty to perform any act which would involve
it in expense or liability or to institute or defend any suit in respect hereof,
or to advance any of its own monies. Borrowers shall indemnify and hold Agent
and Lender, their respective employees and officers harmless from and against
any loss, cost or damage

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<Page>

(including, without limitation, reasonable attorneys' fees and disbursements)
incurred by Agent and/or Lender in connection with the transactions contemplated
hereby, except to the extent that such loss or damage results from Agent's or
Lender's gross negligence or willful misconduct.

          SECTION 5.3    RELIANCE. Agent shall be protected in acting upon any
written notice, resolution, request, consent, order, certificate, report,
opinion, bond or other paper, document or signature believed by it to be
genuine, and it may be assumed that any person purporting to act on behalf of
any Person giving any of the foregoing in connection with the provisions hereof
has been duly authorized to do so. Agent may consult with counsel, and the
opinion of such counsel shall be full and complete authorization and protection
in respect of any action taken or suffered by it hereunder and in good faith in
accordance therewith. Agent shall not be liable for any act or omission done or
omitted to be done by Agent in reliance upon any instruction, direction or
certification received by Agent and without gross negligence or willful or
reckless misconduct.

          SECTION 5.4    RESIGNATION OF AGENT.

          (a)  Agent shall have the right to resign as Agent hereunder upon
thirty (30) days' prior written notice to Lender, and in the event of such
resignation, Lender shall appoint a successor Agent which must be an Eligible
Institution. No such resignation by Agent shall become effective until a
successor Agent shall have accepted such appointment and executed an instrument
by which it shall have assumed all of the rights and obligations of Agent
hereunder. If no such successor Agent is appointed within sixty (60) days after
receipt of the resigning Agent's notice of resignation, the resigning Agent may
petition a court for the appointment of a successor Agent.

          (b)  In connection with any resignation by Agent, (i) the resigning
Agent shall, at the sole cost of Borrowers, (A) duly assign, transfer and
deliver to the successor Agent this Agreement and all cash and Permitted
Investments held by it hereunder, (B) execute and/or authorize such reasonable
documents and instruments as may be necessary to give effect to such succession
and (C) take such other actions as may be reasonably required by Lender or the
successor Agent in connection with the foregoing and (ii) the successor Agent
shall establish in its name, new cash collateral accounts, which shall become
the Accounts for purposes of this Agreement upon the succession of such Agent.

          (c)  Lender at its sole discretion shall have the right, upon thirty
(30) days' notice to Agent, to substitute Agent with a successor Agent that
satisfies the requirements of an Eligible Institution or to have one or more of
the Accounts held by another Eligible Institution, provided that such successor
Agent shall perform the duties of Agent pursuant to the terms of this Agreement.

          SECTION 5.5    LENDER APPOINTED ATTORNEY-IN-FACT. Each Borrower hereby
irrevocably constitutes and appoints Lender as such Borrower's true and lawful
attorney-in-fact, with full power of substitution, to execute, acknowledge and
deliver any instruments and to exercise and enforce every right, power, remedy,
option and privilege of such Borrower with respect to the Account Collateral,
and do in the name, place and stead of such Borrower, all such acts, things and
deeds for and on behalf of and in the name of such Borrower, which such Borrower
could or might do or which Agent or Lender may deem necessary or desirable to
more fully vest in Lender the rights

                                       498
<Page>

and remedies provided for herein and to accomplish the purposes of this
Agreement. The foregoing power of attorney is irrevocable and coupled with an
interest. If any Borrower fails to perform any agreement herein contained and
such failure shall continue for five (5) Business Days after noticof such
failure is given to such Borrower, Lender may perform or cause performance of
any such agreement, and any reasonable expenses of Lender and Agent in
connection therewith shall be paid by such Borrower.

          SECTION 5.6    ACKNOWLEDGMENT OF LIEN/OFFSET RIGHTS. Agent hereby
acknowledges and agrees that (a) the Accounts shall be held by Agent in the name
of Lender, (b) all funds held in the Accounts shall be held for the benefit of
Lender, subject to the terms of this Agreement and the Mezzanine Loan Agreement,
(c) Borrowers have granted to Lender a first priority security interest in the
Account Collateral and all proceeds thereof, (d) Agent shall not disburse any
funds from the Accounts except as provided herein, and (e) Agent shall invest
and reinvest any balance of the Accounts in Permitted Investments. Agent hereby
waives any right of offset, banker's lien or similar rights against, or any
assignment of, or security interest or other interest in, the Account
Collateral.

VI.  REMEDIES

          SECTION 6.1    REMEDIES. At any time and from time to time following
the occurrence and during the continuance of an Event of Default, Lender or
Agent, as agent for Lender and only at Lender's direction, may do any (or any
combination of) the following, as determined in Lender's sole discretion:

          (a)  without notice to any Borrower, except as required by law, and at
any time or from time to time, charge, set-off and otherwise apply all or any
part of the Account Collateral against the Obligations or any part thereof;

          (b)  in Lender's sole discretion, at any time and from time to time,
exercise any and all rights and remedies available to it under this Agreement,
and/or as a secured party under the UCC and/or under any other applicable law;
and

          (c)  demand, collect, take possession of, receive, settle, compromise,
adjust, sue for, foreclose or realize upon the Account Collateral (or any
portion thereof) as Lender may determine in its sole discretion.

          SECTION 6.2    WAIVER. Each Borrower hereby expressly waives, to the
fullest extent permitted by law, presentment, demand, protest or any notice of
any kind in connection with this Agreement or the Account Collateral. Each
Borrower acknowledges and agrees that ten (10) days' prior written notice of the
time and place of any public sale of the Account Collateral or any other
intended disposition thereof shall be reasonable and sufficient notice to such
Borrower within the meaning of the UCC.

VII.     MISCELLANEOUS

                                       499
<Page>

          SECTION 7.1    TRANSFERS AND OTHER LIENS. Each Borrower agrees that it
will not (i) sell or otherwise dispose of any of the Account Collateral or (ii)
create or permit to exist any Lien upon or with respect to all or any of the
Account Collateral, except for the Lien granted under this Agreement.

          SECTION 7.2    LENDER'S RIGHT TO PERFORM BORROWERS' OBLIGATIONS; NO
LIABILITY OF LENDER. If any Borrower fails to perform any of the covenants or
obligations contained herein, and such failure shall continue for a period five
(5) Business Days after such Borrower's receipt of written notice thereof from
Lender, Lender may itself perform, or cause performance of, such covenants or
obligations, and the reasonable expenses of Lender incurred in connection
therewith shall be payable by Borrowers to Lender.

          SECTION 7.3    NO WAIVER. The rights and remedies provided in this
Agreement and the other Mezzanine Loan Documents are cumulative and may be
exercised independently or concurrently, and are not exclusive of any other
right or remedy provided at law or in equity. No failure to exercise or delay by
Agent or Lender in exercising any right or remedy hereunder or under the
Mezzanine Loan Documents shall impair or prohibit the exercise of any such
rights or remedies in the future or be deemed to constitute a waiver or
limitation of any such right or remedy or acquiescence therein. Every right and
remedy granted to Agent and/or Lender hereunder or by law may be exercised by
Agent and/or Lender at any time and from time to time, and as often as Agent
and/or Lender may deem it expedient. Any and all of Agent's and/or Lender's
rights with respect to the lien and security interest granted hereunder shall
continue unimpaired, and Borrowers shall be and remain obligated in accordance
with the terms hereof, notwithstanding (a) any proceeding of any Borrower under
the Federal Bankruptcy Code or any bankruptcy, insolvency or reorganization laws
or statutes of any state, (b) the release or substitution of Account Collateral
at any time, or of any rights or interests therein, (c) the release a
substitution of any Person liable for all or ANY PART of the Obligations, or (d)
any delay, extension of time, renewal, compromise or other indulgence granted by
the Agent and/or Lender in the event of any default, with respect to the Account
Collateral or otherwise hereunder. No delay or extension of time by Agent and/or
Lender in exercising any power of sale, option or other right or remedy
hereunder, and no notice or demand which may be given to or made upon any
Borrower by Agent and/or Lender, shall constitute a waiver thereof, or limit,
impair or prejudice Agent's and/or Lender's right, without notice or demand, to
take any action against all of the Borrowers or to exercise any other power of
sale, option or any other right or remedy.

          SECTION 7.4    EXPENSES. The Account Collateral shall secure, and
Borrowers shall pay to Agent and Lender and/or Agent's and Lender's counsel on
demand, from time to time, all costs and expenses (including, but not limited
to, reasonable attorneys' fees and disbursements, and transfer, recording and
filing fees, taxes and other charges) of, incurred in connection with, or
incidental to, the creation or perfection of any lien or security interest
granted or intended to be granted hereby, the custody, care, sale, transfer,
administration, collection of or realization on the Account Collateral, or in
any way relating to the enforcement, protection or preservation of the rights or
remedies of Agent and/or Lender under this Agreement, the Mezzanine Loan
Agreement, the Notes, the Pledges, or the other Mezzanine Loan Documents.
Standard and customary fees and charges associated with the Accounts shall be
paid by Borrowers. Each Borrower agrees that Agent shall be entitled to charge
the Accounts for such fees and expenses.

                                       500
<Page>

          SECTION 7.5    ENTIRE AGREEMENT. This Agreement constitutes the entire
and final agreement amongst the parties with respect to the subject matter
hereof and may not be changed, terminated or otherwise varied, except by a
writing duly executed by the parties.

          SECTION 7.6    NO WAIVER. No waiver of any term or condition of this
Agreement, whether by delay, omission or otherwise, shall be effective unless in
writing and signed by the party sought to be charged, and then such waiver shall
be effective only in the specific instance and for the purpose for which given.

          SECTION 7.7    SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon and inure to the benefit of the parties hereto, their respective successors
and permitted assigns.

          SECTION 7.8    NOTICES. All notices, demands, requests, consents,
approvals and other communications (any of the foregoing, a "Notice") required,
permitted, or desired to be given hereunder shall be in writing and shall be
sent by telefax (with answer back acknowledged) or by registered or certified
mail, postage prepaid, return receipt requested or delivered by hand or
reputable overnight courier addressed to the party to be so notified at its
address hereinafter set forth, or to such other address as such party may
hereafter specify in accordance with the provisions of this Section 7.8. Any
such Notice shall be deemed to have been received three (3) days after the date
such Notice is mailed or on the date of sending by telefax if sent during
business hours on a Business Day (otherwise on the next Business Day), (c) on
the date of delivery by hand if delivered during business hours on a Business
Day (otherwise on the next Business Day), and (d) on the next Business Day if
sent by an overnight commercial courier, in each case addressed to the parties
as follows:

If to Lender:        UBS Warburg Real Estate Investments Inc.
                     1285 Avenue of the Americas, 11th Floor
                     New York, New York 10019
                     Attn: Andrew B. Cohen
                     Fax No.: (212) 713-4631

With a copy to:      Brown Raysman Millstein Felder & Steiner LLP
                     900 Third Avenue
                     New York, New York  10022
                     Attn.: Jeffrey B. Steiner, Esq.
                     Fax No.: (212) 895-2900

And with a copy to:  Wachovia Bank, National Association
                     8739 Research Drive, URP4
                     Charlotte, North Carolina  28288-1075
                     Attn: David Tucker
                     Fax No.: (704) 593-7735

                     or any successor Servicer of the Loan

                                       501
<Page>

If to any Borrower:  c/o Horizon Group Properties, Inc.
                     77 West Wacker Drive, Suite 4200
                     Chicago, Illinois 60601
                     Attn:  Mr. David Tinkham
                     Fax No.: (231) 798-5100

And with a copy to:  c/o Horizon Group Properties Inc.
                     5000 Hakes Drive
                     Muskegon, MI 49441
                     Attention: Ms. Terri Springstead
                     Fax No.: (231) 798-5100

And with a copy to:  Schiff Hardin & Waite
                     7300 Sears Tower
                     Chicago, Illinois 60606
                     Attn: David A. Grossberg, Esq.
                     Fax No.: (312) 258-5700

If to Agent:         Wachovia Bank, National Association
                     8739 Research Drive, URP4
                     Charlotte, North Carolina  28288-1075
                     Attn: David Tucker
                     Fax No.: (704) 593-7735

Any party may change the address to which any such Notice is to be delivered by
furnishing ten (10) days' written notice of such change to the other parties in
accordance with the provisions of this Section 7.8. Notices shall be deemed to
have been given on the date set forth above, even if there is an inability to
actually deliver any Notice because of a changed address of which no Notice was
given or there is a rejection or refusal to accept any Notice offered for
delivery. Notice for any party may be given by its respective counsel.
Additionally, Notice from Lender may also be given by Servicer.

          SECTION 7.9    CAPTIONS. All captions in this Agreement are included
herein for convenience of reference only and shall not constitute part of this
Agreement for any other purpose.

          SECTION 7.10   GOVERNING LAW. This Agreement shall be governed by and
construed and enforced in all respects in accordance with the laws of the State
of New York without regard to conflicts of law principles of such State.
Regardless of any provision in any other agreement, for purposes of the UCC, New
York shall be deemed to be Agent's jurisdiction (within the many of Sections
8-110 and 9-304 of the UCC (as amended)).

          SECTION 7.11   COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which shall constitute an original and all of
which, taken together, shall constitute one and the same document.

                                       502
<Page>

          SECTION 7.12   TERMINOLOGY. Titles of Sections in this Agreement are
for convenience only, and neither limit nor amplify the provisions of this
Agreement, and all references in this Agreement to Sections, Subsections,
paragraphs, clauses, or subclauses shall refer to the corresponding Section,
Subsection, paragraph, clause, or subclause of this Agreement, unless specific
reference is made to the articles, sections or other subdivisions of another
document or instrument.

          SECTION 7.13   RECITALS. The Recitals set forth at the beginning of
this Agreement are hereby incorporated into and made a part of the substantive
provisions of this Agreement.

          SECTION 7.14   NO AMENDMENT. Nothing contained in this Agreement shall
be construed to amend, modify, alter, change or supersede the terms and
provisions of the Mezzanine Loan Agreement or any of the other Mezzanine Loan
Documents. In the event of a conflict between the terms hereof and the terms of
the Mezzanine Loan Agreement, the terms of the Mezzanine Loan Agreement shall
govern and control.

          SECTION 7.15   JURISDICTION, VENUE, SERVICE OF PROCESS. ANY LEGAL
ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT SHALL BE BROUGHT, AT
LENDER'S OPTION, IN THE COURTS OF THE STATE OF NEW YORK, NEW YORK COUNTY OR OF
THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK. EACH
BORROWER HEREBY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, THE NON-EXCLUSIVE JURISDICTION OF THE AFORESAID COURTS. EACH
BORROWER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE
AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES
THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO IT AT ITS ADDRESS
AS SET FORTH ABOVE. EACH BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH
IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID
ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT
BROUGHT IN THE COURTS REFERRED TO ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES
AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR
PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
NOTHING CONTAINED HEREIN SHALL AFFECT THE RIGHT OF LENDER TO SERVE PROCESS IN
ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE
PROCEED AGAINST ANY BORROWER IN ANY OTHER JURISDICTION.

          SECTION 7.16   WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY AND ALL RIGHTS IT MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON, OR ARISING OUT OF,
UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY OR
PARTIES HERETO RELATING TO THE MEZZANINE LOAN AND THE LENDING RELATIONSHIP WHICH
IS THE SUBJECT OF THE

                                       503
<Page>

MEZZANINE LOAN AGREEMENT. THIS PROVISION IS A MATERIAL INDUCEMENT FOR LENDER
ENTERING INTO THIS AGREEMENT.

                         [NO FURTHER TEXT ON THIS PAGE]

                                       504
<Page>

          IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.

                                             BORROWER:

                                             LAUGHLIN HOLDINGS LLC

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

                                             MEDFORD HOLDINGS LLC

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

                                             WARRENTON HOLDINGS LLC

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

                                       505
<Page>

                                        LENDER:

                                        UBS WARBURG REAL ESTATE
                                        INVESTMENTS INC., a Delaware corporation

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

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

                                       506
<Page>

                                             AGENT:

                                             WACHOVIA BANK, NATIONAL ASSOCIATION

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

                                       507

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