Mortgage Note/lasalle

MORTGAGE NOTE


$3,656,250 March 19, 1996


1. FOR VALUE RECEIVED, FIRST TEAM SPORTS, INC., a Minnesota corporation ("Maker"), hereby promises to pay to the order of LASALLE NATIONAL BANK, a national banking association ("Lender"), the principal sum of Three Million Six Hundred Fifty Six Thousand Two Hundred Fifty and No/100 Dollars ($3,656,250), at the place and in the manner hereinafter provided, together with interest thereon at the rates described below.


2. Interest shall accrue on the balance of principal remaining from time to time unpaid under this Note during each calendar month (whether full or partial) prior to the Maturity Date (as hereinafter defined) at an annual rate (the "Loan Rate") equal to 7.41%. Interest shall be computed on the basis of a year consisting of 360 days and having twelve thirty-day months.


3. Payments of principal and interest due under this Note, if not sooner declared to be due in accordance with the provisions hereof, shall be made as follows:


(i) On the date the proceeds of the loan evidenced by this
Note (the "Loan") are disbursed (the "Closing Date"), interest on the
principal balance of this Note that shall accrue during the period
commencing on the Closing Date and ending on the last day of the month
in which the Closing Date occurs shall be due and payable.


(ii) Commencing on May 1, 1996, and on the first day of each
month thereafter through and including the month in which the Maturity
Date occurs, installments of principal and accrued and unpaid interest
thereon in the amount of $43,228.78 each shall be due and payable.


(iii) The unpaid principal balance of this Note, if not sooner
declared to be due in accordance with the terms hereof, together with
all accrued and unpaid interest, shall be due and payable in full on
April 1, 2006 (the "Maturity Date").


4. All payments and prepayments on account of the indebtedness evidenced by this Note shall be first applied to accrued and unpaid interest on the unpaid principal balance of this Note, second, to all other sums (other than principal) then due Lender hereunder or under any of the Loan Documents (as hereinafter defined), third, to the installment of principal due in the month in which the payment or prepayment is made, and the remainder, if any, to the unpaid principal balance of this Note in the inverse order of maturity. Any prepayment on account of the indebtedness evidenced by this Note shall not extend or postpone the due date or reduce the amount of any subsequent monthly installment of principal and interest due hereunder.


5. After maturity or the earlier acceleration of the indebtedness evidenced by this Note, or if said indebtedness has not been accelerated, during any period in which an Event of Default (as hereinafter defined) exists under this Note or any of the Loan Documents, Maker shall pay interest on the balance of principal remaining unpaid during any such period at an annual rate (the "Default Rate") equal to four percent (4%) plus the Loan Rate then in effect under this Note. The interest accruing under this paragraph shall be immediately due and payable by Maker to the holder of this Note and shall be additional indebtedness evidenced by this Note.


6. In the event any payment of interest or principal due hereunder is not made within five days after such payment is due in accordance with the terms hereof, then, in addition to the payment of the amount so due, Maker shall pay to Lender a "late charge" of five cents for each whole dollar so overdue to defray part of the cost of collection and handling such late payment. Maker agrees that the damages to be sustained by the holder hereof for the detriment caused by any late payment is extremely difficult and impractical to ascertain, and that the amount of five cents for each one dollar due is a reasonable estimate of such damages, does not constitute interest, and is not a penalty.


7. (a) Maker may voluntarily prepay the principal balance of this Note in whole, but not in part, at any time, subject to the following conditions:


(i) Not less than 14 days prior to the date upon which Maker
desires to make such prepayment, Maker shall deliver to Lender written
notice of its intention to prepay, which notice shall be irrevocable
and state the prepayment amount and the prepayment date;


(ii) Maker shall pay to Lender, concurrently with such
prepayment, a prepayment premium (the "Prepayment Premium") equal to
the greater of (A) the Yield Amount (as hereinafter defined) or (B) 1%
of the principal balance being prepaid;


(iii) Maker shall pay to Lender all accrued and unpaid interest
through the date of such prepayment on the principal balance being
prepaid;


(iv) Maker shall pay to Lender any other obligations of Maker to
Lender then due which remain unpaid; and


(v) Concurrently with such prepayment, the Marquette Note (as
hereinafter defined) is also prepaid in full.


(b) Maker acknowledges that the Loan was made on the basis and assumption that Lender would receive the payments of principal and interest set forth herein for the full term hereof. Therefore, whenever the maturity hereof has been accelerated by Lender by reason of the occurrence of an Event of Default under this Note or any other of the Loan Documents, including an acceleration by reason of sale, conveyance, further encumbrance (except as otherwise permitted by the Loan Documents) or other Event of Default (which acceleration shall be at Lender's sole option), there shall be due, in addition to the outstanding principal balance, accrued interest and other sums due hereunder, a premium equal to the Prepayment Premium that would be payable pursuant to clause (a) above if such principal balance had been voluntarily prepaid by Maker.


(c) For purposes of this Note, the "Yield Amount" shall be the amount calculated as follows:


(i) There shall first be determined, as of the date fixed for
prepayment (the "Prepayment Date"), the yield to maturity percentage
(the "Current Yield") for the United States Treasury Note closest in
maturity to the Maturity D ...