Real Estate Mortgage

Athena Holdings LLC ("Mortgagor", whether one or more) mortgages, conveys and warrants to Advantage Learning Systems, Inc. ("Lender") in consideration of the sum of Seven Million Dollars ($7,000,000.00) loaned or to be loaned to Athena Holdings LLC ("Borrower,"), evidenced by Borrower's note(s) or agreement dated December 17, 1998, the real estate described below, together with all privileges, hereditaments, easements and appurtenances, all rents, leases, issues and profits, all awards and payments made as a result of the exercise of the right of eminent domain, and all existing and future improvements and fixtures (all called the "Property").


THIS SPACE RESERVED FOR RECORDING DATA
NAME AND RETURN ADDRESS
Michael J. Dwyer
Godfrey & Kahn, S.C.
780 North Walter Street
Milwaukee, Wisconsin 53202

60-0708-154-0402-8
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PARCEL IDENTIFICATION NUMBER (PIN)


1. DESCRIPTION OF PROPERTY


Lot 23 First Addition Old Sauk Trails Park, City of Madison, Dane County,
Wisconsin



The Property is not the homestead of Mortgagor.


2. TITLE. Mortgagor warrants title to the Property, excepting only restrictions and easements of record, municipal and zoning ordinances, current taxes and assessments not yet due and no other.


3. ESCROW. Interest will not be paid on escrowed funds required under paragraph 7(a).


4. MORTGAGE AS SECURITY. This Mortgage secures prompt payment to Lender of (a) the sum stated in the first paragraph of this Mortgage, plus interest and charges, according to the terms of a promissory note(s) or agreement of Borrower to Lender identified herein, and any extensions, renewals or modifications of such promissory note(s) or agreement, and (b) any additional sums which are in the future loaned by Lender to any Mortgagor, to any Mortgagor and another or to another guaranteed or endorsed by any Mortgagor and agreed in documents evidencing the transaction to be secured by this Mortgage, plus interest and charges, (all called the "Note"). This Mortgage also secures the performance of all covenants, conditions and agreements contained in this Mortgage, and to the extent not prohibited by law costs and expenses of collection or enforcement. Unless otherwise required by law, Lender will satisfy this Mortgage upon request by Mortgagor if (a) the Note has been paid according to its terms, (b) any commitment to make future advances under the Note has terminated, (c) Lender has terminated any line of credit under which advances are to be secured by this Mortgage, and (d) all other payments required under this Mortgage and the Note and all other terms, conditions, covenants, and agreements contained in this Mortgage and the Note have been paid and performed.


5. TAXES. To the extent not paid to Lender under paragraph 7(a), Mortgagor shall pay before they become delinquent all taxes, assessments and other charges which may be levied or assessed against the Property, or against Lender upon this Mortgage or the Note or other debt secured by this Mortgage, or upon Lender's interest in the Property, and deliver to Lender receipts showing timely payment.


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6. INSURANCE. Mortgagor shall keep the improvements on the Property insured against direct loss or damage occasioned by fire, extended coverage perils and such other hazards as Lender may require, through insurers approved by Lender, in amounts, without co-insurance, not less than the unpaid balance of the Note or the full replacement value, whichever is less, and shall pay the premiums when due. The policies shall contain the standard mortgage clause in favor of Lender and, unless Lender otherwise agrees in writing, the original of all policies covering the Property shall be deposited with Lender. Mortgagor shall promptly give notice of loss to insurance companies and Lender. All proceeds from such insurance shall be applied, at Lender's option, to the installments of the Note in the inverse order of their maturities (without penalty for prepayment) or to the restoration of the improvements on the Property. In the event of foreclosure of this Mortgage or other transfer of title to the Property, in extinguishment of the indebtedness secured hereby, all right, title, and interest of Mortgagor in and to any insurance then in force shall pass to the purchaser or grantee.


7. MORTGAGOR'S COVENANTS. Mortgagor covenants:


(a) ESCROW. To pay Lender sufficient funds at such times
as Lender designates, to pay (1) the estimated annual
real estate taxes and assessments on the Property,
(2) all property insurance premiums when due, and (3)
if payments owed under the Note are guaranteed by
mortgage guaranty insurance, the premiums necessary
to pay for such insurance which Lender may cancel at
any time. Upon demand, Mortgagor shall pay Lender
such additional sums as are necessary to pay these
items in full when due. Lender shall apply these
amounts against the taxes, assessments and insurance
premiums when due. Escrowed funds may be commingled
with Lender's general funds;


(b) CONDITION AND REPAIR. To keep the Property in good
and tenantable condition and repair, and to restore
or replace damaged or destroyed improvements and
fixtures;


(c) LIENS. To keep the Property free from liens and
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