Document:

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                                                                  Page 88 of 107

                                  EXHIBIT 10-4
                                  ------------

                  MORTGAGE MODIFICATION AND EXTENSION AGREEMENT
                  ---------------------------------------------

                  THIS AGREEMENT, dated as of October 1, 2001, is between the
COUNTY OF ORLEANS INDUSTRIAL DEVELOPMENT AGENCY, a public benefit corporation of
the State of New York, having its principal office at County Administration
Building, 14016 Route 31 West, Albion, New York 14411 (the "AGENCY"), ONTARIO
FOODS, INCORPORATED, a New York corporation with an office at 4001 Salt Works
Road, Medina, New York 14103 (the "BORROWER") (Agency and Borrower are hereafter
collectively referred to as "MORTGAGOR"), and GENESEE CORPORATION, a New York
corporation having an address at 16 West Main Street, Suite 600, Rochester, New
York ("MORTGAGEE").

                                    RECITALS
                                    --------

                  WHEREAS, the Agency is the owner of certain real property
located at 4001 Salt Works Road, Town of Shelby and Village of Medina, County of
Orleans and State of New York which is more particularly bounded and described
in SCHEDULE "A" attached hereto (the "PREMISES"); and

                  WHEREAS, M&T Real Estate, Inc. ("M&T") is the owner and holder
of a mortgage covering all or a portion of the Premises, which mortgage is
described in SCHEDULE "B" attached hereto (the "EXISTING MORTGAGE" and the
"Mortgage"); and

                  WHEREAS, M&T has assigned the Existing Mortgage to Mortgagee
by Assignment of Mortgage dated as of September 25, 2001 which Assignment is
intended to be recorded in the Orleans County Clerk's Office prior to the
recording of this Agreement; and

                  WHEREAS, Mortgagor and Mortgagee now desire to modify and
amend the payment terms of the notes, bonds or other obligation secured by the
Existing Mortgage (collectively, the "NOTE") and to extend the term thereof;

                  NOW, THEREFORE, in consideration of the respective
representations, warranties, covenants and agreements contained herein, the
parties hereto agree as follows:

                        MORTGAGOR'S ESTOPPEL CERTIFICATE
                        --------------------------------

                  Mortgagor certifies to Mortgagee that there is now due and
owing on the Note and secured by the Mortgage, without offset or defense of any
kind, the aggregate principal sum of

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                                                                  Page 89 of 107

TWO MILLION TWO HUNDRED FIFTY THOUSAND AND NO/100 DOLLARS ($2,250,000.00), in
lawful money of the United States of America, the maximum amount of principal
indebtedness which is or under any contingency may be secured by the Mortgage.

                      MODIFICATION AND EXTENSION PROVISIONS
                      -------------------------------------

                                  RESTATED NOTE
                                  -------------

                  The terms, conditions, provisions, covenants, agreements,
warranties and privileges, including prepayment privileges, if any, contained in
the Note are hereby modified and amended in their entirety and restated as set
forth in EXHIBIT "A" attached hereto and, as so modified, amended and restated,
are hereby ratified, confirmed and approved.

                                RESTATED MORTGAGE
                                -----------------

         The terms, conditions, provisions, covenants, agreements, warranties
and privileges, including prepayment privileges, if any, contained in the
Mortgage are hereby modified and amended in their entirety (other than the
granting of the lien under the Mortgage) and restated as hereafter set forth
and, as so modified, amended and restated, are hereby ratified, confirmed and
approved. Mortgagee acknowledges and confirms that the maximum amount of
principal indebtedness which is or under any contingency may be secured by the
Mortgage is hereby reduced to TWO MILLION TWO HUNDRED FIFTY THOUSAND AND 00/100
DOLLARS ($2,250,000.000).

         Mortgagee also acknowledges and agrees that no equipment of Mortgagor
is or shall be hereinafter secured by the lien of the Mortgage, other than such
items of equipment that affix to the Premises and become fixtures relating to
the utilities, heating, air conditioning, ventilation, plumbing, and disposal
systems benefiting the Premises.

         Each Mortgagor for and as to itself and not for or as to the other does
hereby covenant and agree with Mortgagee as follows:

                  1. DEFINITIONS: As used in this Agreement, the following
capitalized terms shall have the meanings set forth below:

                  "CONTRACT RATE" means the interest rate to be paid on the
Loan, as set forth in the Note.

                  "DEFAULT RATE" means eighteen percent (18%).

                  "ENVIRONMENTAL LAWS" mean all federal, state and local
environmental, land use, zoning, health, chemical use, safety and sanitation
laws, statutes, ordinances and codes relating to the protection of the
Environment and/or governing the use, storage, treatment, generation,
transportation, processing, handling, production or disposal of Hazardous
Substances and the

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rules, regulations, policies, guidelines, interpretations, decisions, orders and
directives of federal, state and local governmental agencies and authorities
with respect thereto.

                  "ENVIRONMENTAL PERMITS" mean all permits, licenses, approvals,
authorizations, consents or registrations required by any applicable
Environmental Law in connection with the ownership, use and/or operation of the
Premises for the storage, treatment, generation, transportation, processing,
handling, production or disposal of Hazardous Substances or the sale, transfer
or conveyance of the Premises.

                  "EVENT OF DEFAULT" means any of those events of default
enumerated in Section 18 of this Mortgage.

                  "FORECLOSURE ACTION" means any action, suit or proceeding
brought by Mortgagee to collect the Note, foreclose this Mortgage and/or to
enforce any of its other rights or remedies under the Loan Documents.

                  "GOVERNMENTAL AUTHORITY" means any governmental authority
having jurisdiction over the Premises.

                  "HAZARDOUS SUBSTANCE" means, without limitation, any flammable
explosives, radon, radioactive materials, asbestos, urea formaldehyde foam
insulation, polychlorinated biphenyls, petroleum and petroleum products,
methane, hazardous materials, hazardous wastes, hazardous or toxic substances or
related materials as defined in the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended (42 U.S.C. Sections 9601, ET
SEQ.), the Hazardous Materials Transportation Act, as amended (49 U.S.C.
Sections 1801, ET SEQ.), the Resource Conservation and Recovery Act, as amended
(42 U.S.C. Sections 6901, ET SEQ.), the Toxic Substances Control Act, as amended
(15 U.S.C. Sections 2601, ET SEQ.), Articles 15 and 27 of the New York State
Environmental Conservation Law or any other applicable Environmental Law and the
regulations promulgated thereunder.

                  "LEASE AGREEMENT" shall mean that certain Lease Agreement
dated as of October 1, 1998 from the Agency, as Landlord, to Borrower, as
Tenant, relating to the Premises.

                  "LETTER OF CREDIT" means that certain letter of credit issued
by Bank of Nova Scotia in the principal amount of $500,000 to be available as
collateral security for the repayment of the Loan.

                  "LOAN" shall mean the amounts owed Mortgagee under the terms
of the Note and Mortgage.

                  "LOAN DOCUMENTS" means the Note and the Mortgage.

                  "PERMITTED ENCUMBRANCES" mean (a) this Mortgage, (b) utility,
access and other easements and rights-of-way and restrictions that do not
materially impair the utility or value of the Premises or the Improvements for
their intended purpose, (c) real property taxes not yet delinquent, (d) the
exceptions to title set forth in the Title Policy, (e) subordinate liens in
favor of the Bank of Nova Scotia, Scotiabank Inc. and Royal Bank of Canada,
through its division RBC

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Capital Partners, and (f) any other liens or encumbrances which are approved in
writing by Mortgagee or its counsel.

                  "PERSON" means any individual, partnership, corporation, trust
or unincorporated organization, and any government or agency or political
subdivision or branch thereof.

                  "RECEIVER" means a receiver of the rents and profits of the
Premises appointed by a court of competent jurisdiction for the benefit of
Mortgagee in a Foreclosure Action.

                  "RELEASE" has the same meaning as given to that term in the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended (42 U.S.C. Section 9601, ET SEQ.), and the regulations promulgated
thereunder.

                  "TAXES" mean all real estate and similar taxes and assessments
(including assessments for local or municipal improvements and payments in lieu
of taxes), personal property taxes and assessments, sales, use and occupancy
taxes, water and sewer rates, rents and charges, water pollution control
charges, charges for public utilities, fees for governmental approvals, and all
other governmental charges and fees, of any kind and nature whatsoever, which
may at any time during the term of the Loan be assessed or levied against or
imposed upon or be payable with respect to or become a lien on the Premises, the
Improvements or any part thereof.

                  "TITLE COMPANY" means the title insurance company or companies
insuring the leasehold interest of Borrower in and to the Premises.

                  "TITLE POLICY" means the leasehold title insurance policy
issued by the Title Company to Borrower with respect to the Premises.

                  2. WARRANTY OF TITLE: Borrower warrants that the title to the
Premises and represents and warrants to Mortgagee that the Agency has good title
to the Premises, free and clear of all liens, security interests, encumbrances,
conditional sales contracts, installment contracts or other financing devices,
except for Permitted Encumbrances.

                  3. PAYMENT OF INDEBTEDNESS: Borrower covenants to pay the
indebtedness evidenced by the Note in accordance with its terms.

                  4. CONDEMNATION AWARDS: Borrower shall promptly notify
Mortgagee of the commencement of any condemnation proceedings affecting the
Premises, the Improvements, the Appurtenances or any part thereof or for use and
occupancy or for change of grade of streets and after the occurrence of an Event
of Default and Mortgagor hereby irrevocably authorizes Mortgagee to appear in
such proceedings and to participate with Mortgagor in the determination of any
Condemnation Awards, to collect and receive any Condemnation Awards from the
authorities making the same, to give proper receipts and acquittances therefor
and to apply the Net Proceeds thereof to payment on account of the unpaid
principal amount of the Loan, whether then matured or not, together with
interest thereon at the Contract Rate to the date of receipt of such payment by
Mortgagee, notwithstanding any lesser rate of interest required to be paid by
the authorities making the same. After application in accordance with the terms
of this Mortgage, the remaining portion of the Condemnation Award

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(if any) shall be paid over to Borrower or otherwise as a court of competent
jurisdiction may direct. Mortgagor shall submit to Mortgagee for prior approval
the proposed amount of any Condemnation Award to be made by reason of any such
taking or condemnation. Mortgagor hereby appoints Mortgagee its agent and
attorney-in-fact (which appointment shall be deemed to be an agency coupled with
an interest), with full power of substitution, to appear in any such proceeding
and to participate in the determination of any Condemnation Awards on its behalf
in the event that, at the time of any such taking or condemnation, any Event of
Default has occurred and is continuing. Mortgagor shall execute and deliver to
Mortgagee on demand such assignments and other instruments as Mortgagee may
require for such purposes and Borrower shall reimburse Mortgagee and the Agency
for its costs (including reasonable legal fees) in the collection of any
Condemnation Awards.

                  5. CASUALTY AND OTHER INSURANCE: Borrower shall maintain
insurance against such risks and for such amounts as are customarily insured
against by businesses of like size and type in the area, including the
following:

                  (a) Insurance against loss or damage by fire, lightning and
other casualties customarily insured against (including boiler explosion, if
appropriate), with a uniform standard extended coverage endorsement, such
insurance to be in an amount not less than the full principal amount of the
Loan;

                  (b) Insurance against loss or damage by flood, such insurance
to be in an amount not less than the principal amount of the Loan unless
Mortgagee receives satisfactory evidence that no portion of the Premises is
located within an area identified by the U.S. Department of Housing and Urban
Development as having special flood hazards; and

                  (c) Insurance protecting Mortgagor against loss arising from
liability imposed by law or assumed in any written contract and loss or
liability arising from personal injury, including bodily injury or death, or
damage to the property of others, caused by an accident or occurrence with a
limit of liability of not less than $1,000,000 (combined single limit for
personal injury, including bodily injury or death, and property damage).

                  All policies of insurance required by this Section shall be
procured and maintained in financially sound and generally recognized
responsible insurance companies selected by Borrower and reasonably acceptable
to Mortgagee. Such insurance may be written with deductible amounts comparable
to those on similar policies carried by other companies engaged in businesses
similar in size, character and other respects to those in which Borrower is
engaged. All policies evidencing the insurance required by subparagraphs (a),
(b) and (c) hereof shall contain a New York standard mortgagee clause, without
contribution, showing Mortgagee's interest as first mortgagee, shall provide for
payment to Mortgagee of the proceeds of insurance resulting from any claim for
loss or damage thereunder, shall provide for at least thirty (30) days' prior
written notice to Mortgagee of the cancellation of such policies and of any
material change in the terms or conditions thereof and shall provide for notice
to Mortgagee of all material claims made thereunder.

                  The policies (or binders) of insurance required by
subparagraphs (a) and (b) hereof, together with proof of the payment of the
premiums therefor, and a photocopy of the

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policy (or binder) of insurance required by subparagraph (c) hereof shall be
delivered to Mortgagee at the time of the execution and delivery of this
Mortgage. Certificates or binders evidencing coverage provided upon execution
hereof shall be acceptable to Mortgagee. Borrower shall deliver to Mortgagee
annually a certificate reciting that there is in full force and effect insurance
coverage of the types and in the amounts required by this Section and complying
with the requirements hereof. Prior to the expiration of each such policy,
Borrower shall furnish Mortgagee with satisfactory evidence that such policy has
been renewed or replaced or is no longer required. Borrower shall pay all
premiums on the insurance policies required by this Section and shall provide
such further information with respect to the insurance coverage required hereby
as Mortgagee may from time to time reasonably require.

                  Borrower shall promptly notify Mortgagee of any material loss,
damage or other casualty with respect to the Improvements, the Equipment or any
part thereof. Borrower shall not permit any condition to exist on the Premises
or in the Improvements which would wholly or partially invalidate the insurance
thereon. Mortgagor hereby assigns to Mortgagee all of its right, title and
interest in and to the insurance policies required by subsections (a) and (b)
hereof, including any unearned premiums thereon, such assignment to take effect
immediately upon the occurrence of any Event of Default. Mortgagor hereby
irrevocably authorizes Mortgagee to participate with Mortgagor in the adjustment
and compromise of any insurance claims for any loss, damage or other casualty
with respect to the Improvements or any part thereof under said insurance
policies, to collect and receive any Casualty Insurance Proceeds from the
insurers paying the same, to give proper receipts and acquittances therefor and,
provided that at the time of any such loss, damage or casualty, an Event of
Default has not occurred, to make the same available to Borrower, in whole or in
part, for the purpose of repairing, restoring, rebuilding or replacing the
damaged Improvements, in which case such proceeds shall be payable to Borrower
in such installments and under such terms and conditions as Mortgagee may
require, or, if any such loss, damage or casualty occurs during the last year of
the term of the Loan and net proceeds exceed $500,000, to apply all or any
portion of the Net Proceeds thereof to payment on account of the unpaid
principal amount of the Loan, whether then matured or not, together with
interest thereon at the Contract Rate to the date of receipt of such payment by
Mortgagee. After application in accordance with the terms of this Mortgage, the
remaining portion of the Casualty Insurance Proceeds (if any) shall be paid over
to Borrower or otherwise as a court of competent jurisdiction may direct.
Borrower shall submit to Mortgagee for prior approval the proposed amount of any
Casualty Insurance Proceeds to be paid by reason of any such loss, damage or
casualty. Mortgagor hereby appoints Mortgagee its agent and attorney-in-fact
(which appointment shall be deemed to be an agency coupled with an interest),
with full power of substitution, to participate in the adjustment and compromise
of any Casualty Insurance Proceeds on its behalf in the event that, at the time
of any such loss, damage or casualty, any Event of Default has occurred and is
continuing. Mortgagor shall execute and deliver to Mortgagee on demand such
assignments and other instruments as Mortgagee may require for such purposes and
shall reimburse Mortgagee and the Agency for their costs (including reasonable
legal fees) in the collection of any Casualty Insurance Proceeds.

                  Within 15 days of receipt of written request therefor,
Borrower shall deliver to Mortgagee receipted bills, canceled checks or other
proof reasonably satisfactory to Mortgagee evidencing payment of the premiums
for the policies of insurance required by this Section.

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                  If at any time during the term of the Loan an Event of Default
has occurred and is continuing, Mortgagee may require Borrower to pay to
Mortgagee on the first day of each and every month, together with and in
addition to the monthly installment of principal and/or interest required to be
paid under the Note, a sum equal to the premiums next due under said policies of
insurance (as estimated by Mortgagee), less all sums already paid therefor,
divided by the number of monthly installments of principal and/or interest due
under the Note one month prior to the date on which such premiums shall be due
and payable, which sums, to the extent received, will be held without interest
and applied by Mortgagee to the payment of such premiums as and when the same
become due and payable. If such monthly insurance escrow payments become due at
a time when any premium shall not have been determined, such payments shall be
estimated on the basis of the premium for the preceding year. If the premium
when determined varies from the premium as estimated, (a) any excess arising
from such monthly payments shall be retained by Mortgagee to be applied in
reduction of subsequent monthly payments and (b) any deficiency in the amount of
such monthly payments shall be paid by Borrower to Mortgagee on demand.

                  6. TAXES: Borrower shall pay and discharge all Taxes as and
when the same become due and payable and before any fine, penalty, interest or
cost may be added thereto or become due or be imposed by operation of law for
the nonpayment thereof, unless Borrower is then contesting (after giving prior
written notice thereof to Mortgagee and the Agency), by appropriate legal
proceedings conducted in good faith and with due diligence, the validity,
application or amount, in whole or in part, of such impositions; provided,
however, that (a) such proceedings shall have the effect of suspending the
collection of such contested Taxes from Borrower or the Premises, (b) neither
the Premises nor any part thereof or interest therein would be in any danger of
being sold, forfeited or lost by reason of such proceedings and (c) Borrower
shall have set aside on its books adequate reserves with respect thereto and
shall have furnished such security, if any, as may be required in such
proceedings or requested by Mortgagee. If, by law, any Taxes for local or
municipal improvements are payable, or at the election of the taxpayer may be
paid, in installments, Borrower may pay such Taxes (and accrued interest on the
unpaid portion thereof) in installments as the same become due and payable.

                  Within 15 days of receipt of written request therefor,
Borrower shall deliver to Mortgagee official receipts of the appropriate taxing
authority or other proof reasonably satisfactory to Mortgagee evidencing payment
of any Taxes.

                  Mortgagor authorizes Mortgagee to order annually a certificate
of the Collector of Taxes or of a tax searching agency satisfactory to Mortgagee
certifying as to the status of the payment of Taxes on the official tax records
for the purpose of protecting Borrower from the improper posting of Taxes and as
additional security for Mortgagee against tax sales. Borrower covenants to pay
or cause to be paid any fee or charge in connection with obtaining such
certificate.

                  7. REMOVAL, DESTRUCTION, ALTERATION OR ABANDONMENT OF
MORTGAGED PROPERTY: Mortgagor shall not remove, demolish or structurally alter
any of the Improvements without the prior written consent of Mortgagee.

                  8. MAINTENANCE AND REPAIR OF IMPROVEMENTS: Borrower shall
maintain the Improvements in good condition at all times, make all necessary
repairs

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thereto and replacements thereof, permit Mortgagee and its representatives to
enter the Premises and the Improvements at reasonable times to inspect the same
and promptly comply with any reasonable request of Mortgagee or its
representatives relating to the repair of the Improvements.

                  9. COMPLIANCE WITH LAWS AND ORDINANCES: Borrower shall comply,
and shall cause all tenants, subtenants and occupants of the Premises to comply,
with all laws and ordinances relating to the use or occupancy of the Premises
and the Improvements and with all requirements, orders and notices of violation
thereof issued by any Governmental Authority, unless Borrower is then contesting
(after giving prior written notice thereof to Mortgagee and the Agency), by
appropriate legal proceedings conducted in good faith and with due diligence,
the validity, application or accuracy, in whole or in part, of any such law,
ordinance, requirement, order or notice. If at any time the then existing use or
occupancy of the Premises or the Improvements shall, pursuant to any zoning or
other law, ordinance or regulation, be permitted only so long as such use or
occupancy shall continue, Borrower shall not cause or permit such use or
occupancy to be discontinued without the prior written consent of Mortgagee.

                  10. SECTION 291-F PROVISIONS: Borrower agrees that it shall
not have the right or power, as against Mortgagee without its consent, to
cancel, abridge or otherwise modify, or to accept prepayments of installments of
rent to become due under, any leases which have an unexpired term of not less
than five years from the date of the execution and delivery of this Mortgage.
The agreement contained in the preceding sentence is made with reference to and
shall be enforceable in accordance with the provisions of Section 291-f of the
Real Property Law. Borrower shall, upon request, enter into an agreement with
Mortgagee pursuant to said Section with respect to any lease hereafter entered
into for a term of at least five years, and Borrower hereby irrevocably
constitutes and appoints Mortgagee its agent and attorney-in-fact (which
appointment shall be deemed to be an agency coupled with an interest), with full
power of substitution in the premises, to execute, deliver and record on its
behalf any such agreement which Borrower has failed or refused to execute and
deliver within 10 days after notice and request therefor is given by Mortgagee.

                  11. LIEN LAW COVENANT: Borrower shall receive the proceeds of
the Loan subject to the trust fund provisions of Section 13 of the Lien Law.

                  12. RESERVED.

                  13. ESTOPPEL CERTIFICATE: Borrower, within three days upon
request in person or within 10 days upon request by mail, will furnish a written
statement duly acknowledged of the amount due on this Mortgage and whether any
offsets or defenses exist against the mortgage debt.

                  14. ASSIGNMENT OF LEASES AND RENTS. Each Mortgagor hereby
assigns to the Mortgagee all existing and future leases to the Premises or any
portion thereof (excluding the Lease Agreement)(including, but not limited to,
any amendments, renewals, extensions or modifications thereof) and the rents,
issues and profits of the Premises (excluding however, any rents payable under
the Lease Agreement) as further security for the payment of the Loan, and each
Mortgagor grants to the Mortgagee the right to enter upon and to take

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possession of the Premises for the purpose of collecting the same and to let the
Premises or any portion thereof, and after payment of each cost and expense
(including, but not limited to, each fee and disbursement of counsel to the
Mortgagee) incurred by the Mortgagee in such entry in collection, to apply the
remainder of the same to the loan, without reflecting its right to maintain any
action theretofore instituted or to bring any action thereafter, to enforce the
payment of the Loan. No Mortgagor shall assign such leases, rents, issues or
profits or any interest therein or grant any similar rights to any person
without the Mortgagee's prior written consent.

                  15. RECORDATION OF DOCUMENTS; PAYMENT OF RECORDING AND FILING
FEES AND MORTGAGE RECORDING TAX: Borrower covenants that it will record or cause
this Mortgage to be duly recorded in all offices where recordation thereof is
necessary and that it will pay or cause to be paid any recording and filing
fees, mortgage recording taxes and additional mortgage recording taxes which may
be or may hereafter become due or payable in connection therewith.

                  16. MORTGAGEE AUTHORIZED TO MAKE CERTAIN PAYMENTS ON BEHALF OF
MORTGAGOR: If within 30 days after the same becomes due and payable Borrower
fails to pay (a) any premium or premiums for the policies of insurance required
by Section 5 hereof, (b) any Tax, together with any fine, penalty, interest,
expense or cost which may have been added thereto or become due or been imposed
by operation of law for nonpayment thereof, (c) any amount required to be paid
by any law or ordinance relating to the use or occupancy of the Premises or the
Improvements or by any requirement, order or notice of violation thereof issued
by any Governmental Authority, (d) any recording or filing fees, mortgage
recording taxes or additional mortgage recording taxes which may be or may
hereafter become due and payable in connection with this Mortgage, Mortgagee is
hereby irrevocably authorized to pay the same on behalf of Borrower, and the
amount thereof so paid by Mortgagee, together with all costs and expenses
incurred by Mortgagee in connection with such payment, including, but not
limited to, reasonable legal fees and disbursements, and interest on all such
amounts, costs and expenses at the rate of one percent (1%) in excess of the
Contract Rate, but in no event in excess of the maximum interest rate permitted
by law, shall be paid by Borrower to Mortgagee on demand. Until paid by
Borrower, all such amounts, costs and expenses, together with the interest
thereon, shall be secured by this Mortgage and may be added to the judgment in
any Foreclosure Action.

                  17. MORTGAGEE AUTHORIZED TO TAKE OR COMPLETE CERTAIN REMEDIAL
ACTIONS ON BEHALF OF BORROWER: If Borrower fails to cause a Release of any
Hazardous Substance occurring after the date hereof in excess of levels
permitted by law on, at or from the Premises to be contained, removed, cleaned
up and otherwise remediated within 90 days after receiving notice thereof or
take such reasonable steps to commence the removal, clean up or remediation
within such period, Mortgagee shall have the right (but not the obligation),
upon ten days written notice to Borrower (or without notice in the case of
emergency), to take or complete such action on behalf of Borrower. The
contractors and/or subcontractors selected by Mortgagee shall have the right to
enter the Premises with such persons, machinery and equipment and to undertake
such investigative, containment, removal, clean-up and other remedial actions as
they shall deem necessary and appropriate with respect to any such Release
without thereby incurring any liability to Borrower on account thereof. Borrower
agrees to cooperate with all contractors and/or subcontractors engaged in such

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                                                                  Page 97 of 107

investigative, containment, removal, clean up or other remedial actions.
Borrower shall be liable to Mortgagee for all costs and expenses, including,
without limitation, reasonable attorneys' and experts' fees, expenses and
disbursements, paid or incurred on account of such actions undertaken on
Borrower's behalf and shall promptly reimburse Mortgagee therefor on demand.
Until paid by Borrower, all such costs and expenses, together with the interest
thereon at the rate of one percent (1%) in excess of the Contract Rate, but in
no event in excess of the maximum interest rate permitted by law, shall be
secured by this Mortgage and may be added to the judgment in any Foreclosure
Action.

                  18. EVENTS OF DEFAULT: The occurrence of any one or more of
the following shall, at the option of Mortgagee, constitute an "Event of
Default" under this Mortgage:

                      (a) Failure of Borrower to pay any installment of
                  principal and/or interest within 20 days after the same
                  becomes due and payable under the Note;

                      (b) Failure of Borrower to pay the amount of any costs,
                  charges or expenses of Mortgagee, with interest thereon, in
                  enforcing any of its rights or remedies under this Mortgage or
                  any of the other Loan Documents within 30 days after notice
                  and demand therefor by Mortgagee;

                      (c) Failure of Borrower to comply with, perform or observe
                  any other covenant or obligation contained in this Mortgage or
                  any of the other Loan Documents within the applicable grace
                  period specified herein or therein or, if no grace period is
                  specified, within 30 days after notice of such failure is
                  given by Mortgagee or other reasonable period of time not to
                  exceed 90 days if such failure can not be reasonably cured
                  within said 30 day period, provided Borrower has commenced to
                  cure and is diligently pursuing such cure;

                      (d) Failure of Borrower to comply with, perform or observe
                  any of its covenants or obligations under any note, mortgage,
                  loan agreement, security agreement, assignment, guaranty or
                  other instrument now or hereafter evidencing, securing or
                  guaranteeing any other indebtedness for borrowed money to
                  Mortgagee within the applicable grace period specified therein
                  or, if no grace period is specified, within 30 days after
                  notice of such failure is given by Mortgagee or other
                  reasonable period of time not to exceed 90 days if such
                  failure can not be reasonably cured within said 30 day period,
                  provided Borrower has commenced to cure and is diligently
                  pursuing such cure;

                      (e) Failure of Borrower to comply with, perform or observe
                  any of its covenants or obligations under any lease or any
                  other lease or sublease now or hereafter affecting the
                  Premises, the Improvements or any part thereof within the
                  applicable grace period specified therein or, if no grace
                  period is specified, within 30 days after notice of such
                  failure is given to Borrower or other reasonable period of
                  time not to exceed 90 days if such failure can not be
                  reasonably cured within said 30 day period, provided Borrower
                  has commenced to cure and is diligently pursuing such cure;

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                                                                  Page 98 of 107

                      (f) If Mortgagor sells, assigns, conveys or otherwise
                  transfers title to the Premises or any part thereof without
                  the prior written consent of Mortgagee;

                      (g) RESERVED;

                      (h) If Borrower directly or indirectly changes the
                  beneficial ownership or number of issued and outstanding
                  shares of any stock of Borrower, whether by operation of law
                  or otherwise, or otherwise vests the "control" in any Person
                  other than Associated Brands Inc., the Ontario parent of
                  Borrower;

                      (i) If any material change is made in the use of the
                  Premises without the prior written consent of Mortgagee;

                      (j) If Borrower fails to maintain its existence as a
                  corporation or dissolves or otherwise disposes of all or
                  substantially all of its assets without the prior written
                  consent of Mortgagee;

                      (k) The entry of a decree or order for relief by a court
                  having jurisdiction in the premises in respect of Borrower in
                  an involuntary case under the federal bankruptcy laws, as now
                  or hereafter constituted, or any other applicable federal or
                  state bankruptcy, insolvency or other similar law, or
                  appointing a receiver, liquidator, assignee, custodian,
                  trustee, sequestrator (or similar official) of Borrower or for
                  any substantial part of its property, or ordering the
                  winding-up or liquidation of its affairs, and the continuance
                  of any such decree or order unstayed and in effect for a
                  period of 90 consecutive days;

                      (l) The commencement by Borrower of a voluntary case under
                  the federal bankruptcy laws, as now or hereafter constituted,
                  or any other applicable federal or state bankruptcy,
                  insolvency or other similar law, or the consent by Borrower to
                  the appointment of or taking possession by a receiver,
                  liquidator, assignee, trustee, custodian, sequestrator (or
                  other similar official) of Borrower or of any substantial part
                  of its property, or the making by Borrower of any assignment
                  for the benefit of creditors, or the failure of Borrower
                  generally to pay its debts as such debts become due, or the
                  taking of any action by Borrower in furtherance of any of the
                  foregoing; or

                      (m) Refusal by the insurance company or companies which
                  issued the fire insurance policy or policies covering the
                  improvements to renew such policy or policies and the refusal
                  by two or more fire insurance companies lawfully doing
                  business in the State of New York and issuing policies of fire
                  insurance on buildings in the locality of the Premises, upon
                  application by Borrower or Mortgagee, to issue a new policy or
                  policies of fire insurance covering the Improvements.

                  19. RIGHTS AND REMEDIES OF MORTGAGEE UPON DEFAULT: Upon the
occurrence of any Event of Default Mortgagee may, at its option, exercise any
one or more of the following rights and remedies:

<PAGE>
                                                                  Page 99 of 107

                      (a) RIGHT TO CURE DEFAULT. Mortgagee may comply with,
                  perform or observe any covenant or obligation which Mortgagor,
                  after applicable grace periods, has failed to comply with,
                  perform or observe under this Mortgage, any of the other Loan
                  Documents and shall have the right to enter the Premises at
                  any time and from time to time for the purpose of curing such
                  default, and any amounts so paid by Mortgagee or the costs of
                  such performance, together with all costs and expenses
                  incurred by Mortgagee in connection with such payment or
                  performance, including, but not limited to, reasonable legal
                  fees and disbursements, and interest on all such amounts,
                  costs and expenses at the Default Rate, but in no event in
                  excess of the maximum interest rate permitted by law, shall be
                  paid by Borrower to Mortgagee on demand. Until paid by
                  Borrower, all such amounts, costs and expenses, together with
                  the interest thereon, shall be secured by this Mortgage and
                  may be added to the judgment in any Foreclosure Action.

                      (b) RIGHT TO INCREASE INTEREST RATE. Mortgagee may change
                  the interest rate on the Note from the Contract Rate to the
                  Default Rate, such change of rate to become effective on the
                  date notice of such change is given to Borrower and to remain
                  in effect until such Event of Default is cured, regardless of
                  whether Mortgagee elects to accelerate the indebtedness
                  evidenced by the Note by reason of such Event of Default.

                      (c) RIGHT TO ACCELERATE INDEBTEDNESS. Mortgagee may
                  declare the entire unpaid principal amount evidenced by the
                  Note and secured by this Mortgage to be due and payable, in
                  which event said amount shall immediately become due and
                  payable.

                      (d) RIGHT TO TAKE POSSESSION OF PREMISES. Borrower agrees
                  to surrender possession of the Premises to Mortgagee upon
                  demand (and Agency hereby irrevocably consents to the same),
                  and Mortgagee shall thereupon have the right to sublease the
                  Premises, the Improvements or any part thereof, to collect all
                  Rents and to apply the same on account of the indebtedness
                  secured hereby, whether then matured or not, after payment of
                  all proper costs, charges and expenses, including, but not
                  limited to, (i) Taxes, (ii) premiums for the policies of
                  insurance required by Section 5 hereof, (iii) amounts required
                  to be paid by any law or ordinance relating to the use or
                  occupancy of the Premises or the Improvements or by any
                  requirement, order or notice of violation thereof issued by
                  any Governmental Agency and (iv) any and all other costs,
                  charges and expenses which it may be necessary or advisable
                  for Mortgagee to pay in the management, operation and
                  maintenance of the Premises, the Improvements or any part
                  thereof, including, without limitation, the cost of making
                  repairs and alterations, commissions for renting the Premises,
                  the Improvements or any part thereof and legal expenses
                  incurred in enforcing claims, preparing papers or any other
                  services that may be required or otherwise as a court of
                  competent jurisdiction may direct. After taking possession of
                  the Premises, Mortgagee may dispossess, by summary proceedings
                  or otherwise, any tenants, subtenants or occupants of the
                  Premises, the Improvements or any part thereof then or
                  thereafter

<PAGE>
                                                                 Page 100 of 107

                  in default in the payment of any rent, and Mortgagor hereby
                  appoints Mortgagee its agent and attorney-in-fact (which
                  agency shall be deemed to be coupled with an interest), with
                  full power of substitution, for such purpose. In the event
                  that Borrower is then an occupant of the Premises, the
                  Improvements or any part thereof, it agrees to surrender
                  possession thereof to Mortgagee upon demand, and if Borrower
                  remains in possession after such demand, such possession shall
                  be as tenant of Mortgagee, and Borrower agrees to pay monthly
                  in advance to Mortgagee such rent for the Premises, the
                  Improvements or any part thereof so occupied as Mortgagee may
                  reasonably demand, and in default of so doing, Mortgagor may
                  also be dispossessed by summary proceedings or otherwise.

                      (e) RIGHT TO FORECLOSE MORTGAGE. Mortgagee may foreclose
                  this Mortgage and sell, if permitted by law, or petition to be
                  sold, the Premises in such manner or order as a court of
                  competent jurisdiction may direct. If permitted by law,
                  Mortgagee may foreclose this Mortgage for any portion of the
                  indebtedness or any other sums secured hereby which are then
                  due and payable, subject to the continuing lien of this
                  Mortgage for the balance of the indebtedness not then due.

                      (f) RIGHT TO APPOINTMENT OF RECEIVER. In any Foreclosure
                  Action Mortgagee shall be entitled to have a Receiver
                  appointed without notice to Mortgagor, without regard to the
                  adequacy of any security for the indebtedness secured hereby
                  and without regard to the solvency of Mortgagor or any
                  guarantor. Such Receiver shall have and may enforce all of the
                  rights and remedies of Mortgagee under subparagraph (d) hereof
                  to the maximum extent permitted by law.

                      (g) NON-JUDICIAL FORECLOSURE. To the extent permitted by
                  law, Mortgagee may choose to utilize the procedures set forth
                  in Article 14 of the New York Real Property Actions and
                  Proceedings Law and commence a non-judicial foreclosure of
                  this Mortgage by power of sale. To the extent permitted by
                  law, Mortgagor waives any right granted pursuant to Section
                  1421 or any other provision of the New York Real Property
                  Actions and Proceedings Law to challenge Mortgagee's election
                  to enforce this Mortgage by means of such non-judicial
                  foreclosure by power of sale. If the Premises consists of two
                  or more distinct parcels, all of such parcels shall be sold as
                  one parcel, unless Mortgagee shall elect otherwise.

                  20. RIGHTS AND REMEDIES OF MORTGAGEE UNDER SECTION 254 NOT
EXCLUSIVE: The rights and remedies of Mortgagee hereunder shall be in addition
to its rights and remedies under the laws of the State of New York, including,
 but not limited to, its rights and remedies under Section 254 of the Real
Property Law. In the event of any conflict between the terms and conditions of
this Mortgage and the provisions of Section 254 of the Real Property Law, the
terms and conditions of this Mortgage shall control. Nothing contained in this
Mortgage shall be construed as requiring Mortgagee to pursue any particular
right or remedy for the purpose of procuring the satisfaction of the obligations
and indebtedness secured hereby, and Mortgagee may exercise any or all of its
rights and remedies under this Mortgage or any of the other Loan Documents or
otherwise provided by law, in its sole discretion.

<PAGE>
                                                                 Page 101 of 107

No failure of Mortgagee to insist upon the strict performance by Mortgagor of
any of its covenants or obligations under this Mortgage or the other Loan
Documents, and no delay by Mortgagee in exercising any of its rights or remedies
hereunder, thereunder or otherwise provided by law, shall be deemed to be a
waiver of such covenants or obligations or to preclude the exercise of such
rights or remedies, and Mortgagee, notwithstanding any such failure or delay,
shall have the right thereafter to insist upon the strict performance by
Mortgagor of all of its covenants and obligations under this Mortgage and the
other Loan Documents and to exercise any and all of its rights and remedies
hereunder, thereunder or otherwise provided by law.

                  21. ENVIRONMENTAL INSPECTION AND CLEAN UP PRIOR TO
FORECLOSURE/INDEMNIFICATION: If Mortgagee elects to foreclose this Mortgage or
to take a deed in lieu of foreclosure, Borrower shall deliver the Premises to
Mortgagee free of any Hazardous Substances in excess of levels permitted by law
so that the condition of the Premises shall conform with all Environmental Laws
then applicable to the Premises and comply with the terms and conditions of all
Environmental Permits then required in connection with the ownership, use,
operation, sale transfer or conveyance of the Premises. Mortgagee may require
that a full or supplemental environmental inspection and audit report with
respect to the Premises of a scope and level of detail satisfactory to Mortgage
be prepared by an environmental engineer or other qualified person acceptable to
Mortgagee, at Borrower's sole cost and expense. Said audit may include physical
inspection of the Premises, a visual inspection of any property adjacent to or
within the immediate vicinity of the Premises, personnel interviews and a review
of all Environmental Permits. If Mortgagee requires, such inspection shall also
include a records search and/or subsurface testing for the presence of Hazardous
Substances in the soil, subsoil, bedrock, surface water and/or groundwater. If
said audit report indicates the presence on, at, or from the Premises of any
Hazardous Substance or a Release or the threat of a Release of any Hazardous
Substance in a quantity significantly greater than what exists on or is present
at the Premises upon the execution hereof (and is in excess of limits permitted
by applicable law), Borrower shall promptly undertake and diligently complete to
completion all necessary appropriate and legally authorized investigative,
containment, removal, clean up and other remedial actions, using methods
recommended by the environmental engineer or other qualified person who prepared
said audit report and acceptable to the appropriate federal, state and local
regulatory authorities with respect thereto. If Borrower shall fail to promptly
undertake or diligently pursue to completion all such required actions,
Mortgagee shall have the right, but not the obligation, upon ten days written
notice to Borrower (or without notice in the case of emergency), to take or
complete such actions on behalf of Borrower as are reasonably necessary. The
contractors and/or subcontractors selected by Mortgagee for this purpose shall
have the right to enter the Premises with such persons, machinery and equipment
and to undertake such investigative, containment, removal, clean up and other
remedial actions as they shall deem necessary and appropriate with respect to
such actions without thereby incurring any liability to Borrower on account
thereof. Borrower agrees to cooperate with all contractors and/or subcontractors
engaged in such actions. Borrower shall be liable to Mortgagee for all costs and
expenses, including, without limitation, attorneys' and experts' fees, expenses
and disbursements, paid or incurred on account of such actions and shall
promptly reimburse Mortgagee therefor on demand. Until paid by Borrower, all
such costs and expenses and the cost of the environmental inspection and audit
report, together with interest thereon at the rate of three percent (3%) in
excess of the Contract Rate, but in no event in excess of the maximum interest
rate permitted by law, shall be secured by this Mortgage and may be added to the
judgment in any Foreclosure Action. Borrower shall defend, reimburse, indemnify

<PAGE>
                                                                 Page 102 of 107

and hold harmless the Mortgagee, its employees, agents, officers and directors,
from and against any claims, demand, penalties, fines, liabilities, settlements,
damages, costs or expenses of whatever kind or nature, known or unknown,
contingent or otherwise, arising out of, or in any way related to, the violation
of, or other liability or responsibility under, any Environmental Laws, or the
release, threatened release, migration or uncontrolled presence of any Hazardous
Substances in excess of levels permitted by law on, at or from the Premises,
including, without limitation, attorney and consultant fees, investigation and
laboratory fees, court costs and litigation expenses. Notwithstanding anything
to the contrary contained in this Mortgage, Borrower's indemnity hereunder shall
be limited to any Release occurring after the execution hereof, provided that
Borrower assigns to Mortgagee upon transfer of title to Mortgagee all
indemnification rights held by Borrower originally granted by Mattel, Inc.

                  22. COSTS OF SUIT: If any action, suit or proceeding is
commenced by or against Mortgagee, including a Foreclosure Action or any
litigation seeking to recover monies under the Letter of Credit, affecting the
Premises or any part thereof or the lien of this Mortgage, Mortgagee may appear,
defend, prosecute, retain counsel and take such other action as Mortgagee shall
deem necessary or advisable, and the costs thereof (including reasonable legal
fees and all applicable statutory costs, allowances and disbursements), together
with interest thereon at the rate of five percent (5%) in excess of the Contract
Rate, but in no event in excess of the maximum interest rate permitted by law,
shall be paid by Borrower to Mortgagee on demand. Until paid by Borrower, all
such amounts, cost and expenses, together with the interest thereon, shall be
secured by this Mortgage and may be added to the judgment in any Foreclosure
Action.

                  23. NOTICES: If pursuant to the terms of this Mortgage
Mortgagee is required to notify Mortgagor of the existence of a condition or the
occurrence of an event which constitutes or after the giving of notice or the
passage of time, or both, would constitute an Event of Default, such notice
shall be in writing, shall be sent by registered or certified mail, return
receipt requested, postage prepaid, and shall be deemed to have been effectively
given upon receipt or upon refusal by Mortgagor to accept delivery of such
notice.

                  24. GOVERNING LAW: This Mortgage shall be governed by and
interpreted in accordance with the laws of the State of New York, including
Section 5-1401 of the New York General Obligations Law (or any similar successor
provision thereto) but excluding all other conflict-of-law rules.

                  25. JURISDICTION: Mortgagor hereby expressly and irrevocably
agrees and consents that any Foreclosure Action may be instituted by Mortgagee
in the Supreme Court of the State of New York in Orleans County, New York, and,
by the execution and delivery of this Mortgage, Mortgagor expressly waives any
objection which it may have now or hereafter to the laying of the venue of or to
the jurisdiction of such court in any Foreclosure Action, and irrevocably
submits generally and unconditionally to the jurisdiction of such court in any
Foreclosure Action.

                  26. COUNTERPARTS: This Mortgage may be executed in one or more
counterparts, each of which shall be deemed an original. Said counterparts shall
constitute but

<PAGE>
                                                                 Page 103 of 107

one and the same instrument and shall be binding upon each of the undersigned as
fully and completely as if all had signed the same instrument.

                  27. MISCELLANEOUS: This Mortgage does not cover real property
principally improved or to be improved by one or more structures containing in
the aggregate not more than six residential dwelling units, each having their
own separate cooking facilities. This Mortgage may not be waived, changed or
discharged orally, but only by an agreement in writing signed by Mortgagee. As
used herein, the singular shall include the plural as the context requires. The
covenants, obligations and warranties hereunder shall run with the land and
shall bind Mortgagor, its successors and assigns and all subsequent owners,
encumbrancers, tenants, subtenants and occupants of the Premises and shall inure
to the benefit of Mortgagee, its successors and permitted assigns and all
subsequent holders of this Mortgage. This Mortgage may not be assigned without
the prior written consent of Mortgagor and its senior lender, such consent not
to be unreasonably withheld or delayed. The captions used herein are for
convenience of reference only and shall not be deemed to be a part of this
Mortgage for any other purpose.

                  28. WAIVER OF TRIAL BY JURY: TO THE EXTENT PERMITTED BY LAW,
MORTGAGOR WAIVES THE RIGHT TO TRIAL BY JURY IN ANY FORECLOSURE ACTION.

                  29. USE OF LETTER OF CREDIT PROCEEDS. In the event Mortgagee
draws upon the Letter of Credit, any such funds drawn thereunder shall be
applied first to late charges, then to outstanding interest and finally to
reduce principal due on the Note.

                  30. NO LIABILITY OF AGENCY. With respect to the Agency, it is
agreed that the Agency, its officers, members, employees, agents and directors
shall have no personal liability hereunder, nor in their capacity as officers,
members, employees, agents and directors. Agency has executed this Mortgage to
subject its interest in the Premises to the lien of this Mortgage, however,
Mortgagee shall have no recourse to Agency other than to its interest in said
Premises. No provision, covenant or agreement contained in this Mortgage or any
obligation herein imposed upon Agency or the breach thereof shall constitute or
give rise to or impose upon Agency any pecuniary liability or a charge upon its
general credit. In making the agreements, provisions and covenants set forth in
this Mortgage, Agency has not obligated itself except with respect to the
Premises. All covenants, stipulations, promises, agreement and obligations of
Agency contained herein shall be deemed to be the covenants, stipulations,
promises, agreements and obligations of Agency and not of any member, director,
employee, or agent of Agency in his or her individual capacity, and no recourse
shall be had for the payment of the principal of any debt or interest thereon or
for any claim based thereon or hereunder against any member, director, officer,
employee or agent of Agency or any natural person executing this Mortgage on
behalf of Agency. No covenant herein contained shall be deemed to constitute a
debt of the State of New York or the County of Orleans, New York and neither the
State of New York, nor the County of Orleans, New York shall be liable on any
covenant herein contained nor shall the indebtedness secured by this Mortgage be
payable out of the funds of Agency.

                  31. AGENCY PROVISIONS.

<PAGE>
                                                                 Page 104 of 107

                  (a) This Mortgage is specifically subordinate to the Reserved
Rights of the Agency in the Lease Agreement and to the Agency's rights to
terminate the Lease Agreement or transfer title to the Premises, provided,
however, that any transfer of title by the Agency to the Borrower shall be
subject and subordinate to this Mortgage and the rights of the Mortgagee under
this Mortgage.

                  (b) Any action required of Agency hereunder is specifically
conditioned upon any reasonable costs and expenses of Agency and its counsel, if
any, being first paid or provided for to Agency's reasonable satisfaction.

<PAGE>
                                                                 Page 105 of 107

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

                                MORTGAGOR:
                                ---------

                                COUNTY OF ORLEANS INDUSTRIAL DEVELOPMENT AGENCY

                                By:  /s/ Jerome Pawlak
                                     -------------------------------------------
                                Name: Jerome Pawlak
                                Its:  Chairman

                                ONTARIO FOODS, INCORPORATED

                                By:  /s/ John R. Foster
                                     -------------------------------------------
                                Name: John R. Foster
                                Its:  President

                                MORTGAGEE:
                                ---------

                                GENESEE CORPORATION

                                By:  /s/ Steven M. Morse
                                     -------------------------------------------
                                Name:  Steven M. Morse
                                Its:   Vice President

<PAGE>
                                                                 Page 106 of 107

STATE OF NEW YORK                    )
                                     )  SS.:
COUNTY OF ORLEANS                    )

         On the 1st day of October in the year 2001 before me, the undersigned,
personally appeared, Jerome Pawlak, personally known to me or proved to me on
the basis of satisfactory evidence to be the individual(s) whose name(s) is
(are) subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their capacity(ies), and that by
his/her/their signature(s) on the instrument, the individual(s), or the person
upon behalf of which the individual(s) acted, executed the instrument.
(Signature and office of individual taking acknowledgment)

                                           /s/ Brenda L. Mufford
                                           -------------------------------------
                                           Notary Public

PROVINCE OF ONTARIO               )
                                  )  SS.:
                                  )

         On the 1st day of October in the year 2001 before me, the undersigned,
personally appeared John R. Foster, personally known to me or proved to me on
the basis of satisfactory evidence to be the individual(s) whose name(s) is
(are) subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their capacity(ies), and that by
his/her/their signature(s) on the instrument, the individual(s), or the person
upon behalf of which the individual(s) acted, executed the instrument.
(Signature and office of individual taking acknowledgment)

                                           /s/ Ira Parghi
                                           -------------------------------------
                                           Notary Public

<PAGE>
                                                                 Page 107 of 107

STATE OF NEW YORK                 )
                                  )  SS.:
COUNTY OF MONROE                  )

         On the 2nd day of October in the year 2001 before me, the undersigned,
personally appeared Steven M. Morse, personally known to me or proved to me on
the basis of satisfactory evidence to be the individual(s) whose name(s) is
(are) subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their capacity(ies), and that by
his/her/their signature(s) on the instrument, the individual(s), or the person
upon behalf of which the individual(s) acted, executed the instrument.
(Signature and office of individual taking acknowledgment)

                                  /s/ Brian G. Flanagan
                                  ---------------------------------------------
                                  Notary Public(BSNS WIRE) King Power International Group Announces a Going-Private Transa
King Power International Group Announces a Going-Private Transaction

        Business Editors

           BANGKOK,   Thailand--(BUSINESS   WIRE)--Oct.   15,  2001--King  Power
International  Group  Co.,  Ltd.  (Amex:KPG)  ("KPG"  or  the  "Company")  today
announced  that its Board of Directors has, on the  recommendation  of a Special
Committee  composed of independent  directors,  approved a merger transaction in
which KPG will be taken private by shareholders  Vichai  Raksriaksorn,  Viratana
Suntaranond,   Aimon  Raksriaksorn,   Niphorn  Raksriaksorn  and  several  other
shareholders  who together  hold  approximately  88.6% of the  Company's  common
shares (the "Majority Shareholders").
           Under the terms of the  merger,  KPG's  shareholders  other  than the
Majority  Shareholders  will, upon consummation of the merger,  cease to have an
equity interest in the surviving  corporation.  Their common shares will instead
convert,  upon consummation of the merger, into the right to receive cash in the
amount of US$1.534 per share, or approximately US$3,531,268 in the aggregate.
           In describing one of the principal motivations for the merger, Vichai
Raksriaksorn,  who is also KPG's Group  Chairman  and Chief  Executive  Officer,
stated  that "the  Company  does not receive any  significant  benefit  from its
status as a public company listed on the American Stock Exchange  ("Amex").  The
Company has not accessed the U.S. public capital markets for the past four years
and does not anticipate doing so in the foreseeable future."
           Following  the  merger,  the  common  shares of KPG will  cease to be
listed on Amex.  KPG also intends to apply to the U.S.  Securities  and Exchange
Commission (the "SEC") to terminate its  registration as a public company in the
United States.
           Prior to  approving  the  merger,  the  Board of  Directors  formed a
Special  Committee  comprising  three  independent   directors  whom  the  Board
determined were not affiliated,  associated,  or employed by KPG or the Majority
Shareholders.  The Special  Committee was tasked by the Board to act in the best
interests of the shareholders who are not Majority  Shareholders in conducting a
review of the fairness of the  transaction  and, if necessary,  to negotiate the
amount of the cash  consideration.  Following its review,  the Special Committee
recommended  that the Board approve the merger as being fair to, and in the best
interests of, the shareholders who are not Majority Shareholders.
           In addition, KPG engaged CLSA Equity Capital Markets Limited ("CLSA")
to perform a valuation of the Company's  common  shares,  and CLSA presented the
completed  valuation to both the Special  Committee  and the full Board prior to
their approving the merger.  In addition,  CLSA has delivered a fairness opinion
to  the  Board  with  respect  to  the  cash  consideration  to be  paid  to the
shareholders other than the Majority Shareholders.
           The  Company  explained  that the merger  remains  subject to certain
conditions,  including  approval by KPG's  shareholders.  The  Company  does not
anticipate  any   difficulty  in  obtaining  this  approval,   as  the  Majority
Shareholders  together  hold a  substantial  majority of KPG's common shares and
have indicated their intention to vote in favor of the merger.
           The date,  time and location of the  shareholders  meeting to approve
the merger will be  announced  at a later date,  as will the record date for the
meeting.  Further  details of the merger and related  information of interest to
shareholders  will be provided in a proxy statement to be mailed to shareholders
prior to the shareholders  meeting. The Company anticipates filing a preliminary
version of this proxy statement with the SEC shortly.

           Note: News releases and other  information on King Power Group can be
accessed  at  www.kingpower.com   and   www.kingpowerinternational.com   on  the
Internet.

<PAGE>

           The above information contains certain forward-looking statements and
information  relating to the Company that is based on the beliefs of the Company
or management as well as assumptions made by and information currently available
to  the  Company  or  management.   When  used  in  this  document,   the  words
"anticipate,"   "believe,"   "estimate,"  "expect,"  and  "intend"  and  similar
expressions,  as they relate to the Company or its  management,  are intended to
identify forward-looking statements. Such statements reflect the current view of
the  Company   regarding  future  events  and  are  subject  to  certain  risks,
uncertainties  and  assumptions,  including the risks and  uncertainties  noted.
Should  one or more of  these  risks or  uncertainties  materialize,  or  should
underlying assumptions prove incorrect,  actual results may vary materially from
those  described  herein  as  anticipated,   believed,  estimated,  expected  or
intended. In each instance,  forward-looking information should be considered in
light of the accompanying  meaningful cautionary statements herein. Factors that
could  cause  results to differ  include,  but are not  limited  to,  successful
performance of internal plans,  the impact of competitive  services and pricing,
and general economic risks and uncertainties.

    --30--mjr/da*

    CONTACT: Halter Capital Corporation
             Kevin B. Halter, 469/633-0100 ext. 200

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