Exhibit 10.13   



                                    LOAN AGREEMENT
                                    --------------



               THIS AGREEMENT ("Agreement") made and entered into as of the
          6th day of February, 1997, by and between THE LION BREWERY, INC.,
          a Pennsylvania corporation with its principal office at 700 North
          Pennsylvania Avenue, Wilkes-Barre, Pennsylvania (the "Borrower");
          and CORESTATES BANK, N.A., a banking corporation with offices
          located at 130 Wyoming Avenue, Scranton, Lackawanna County,
          Pennsylvania  18704 (the "Bank")


                                 W I T N E S S E T H:

               WHEREAS, the Borrower is in the process of making capital
          improvements to its production facility in Wilkes-Barre,
          Pennsylvania to increase its production capacity and efficiency
          (the "Project"); and

               WHEREAS, in connection with the Project, Borrower has
          applied to the Bank for a revolving line of credit in the amount
          of TWO MILLION FIVE HUNDRED THOUSAND and 00/100 ($2,500,000.00)
          DOLLARS (the "Revolver") and further, has applied to the Bank for
          a working capital line of credit in the amount of FIVE MILLION
          and 00/100 ($5,000,000.00) DOLLARS (the "Line") (the Revolver and
          the Line being hereinafter sometimes collectively referred to as
          the "Loans"); and

               WHEREAS, the Bank is willing to make the Loans to Borrower
          pursuant to the terms and conditions of this Agreement and all
          other loan documents referred to in this Agreement (all of which
          are hereinafter sometimes collectively referred to as the "Loan
          Documents" and are incorporated into this Agreement by
          reference).

               NOW, THEREFORE, in consideration of the premises and the
          mutual covenants hereinafter set forth, and for other good and
          valuable consideration, the receipt and sufficiency of which is
          hereby acknowledged, the parties hereto agree as follows:

               SECTION 1.     THE LOANS.
                              ---------

                    (a)  Revolver. The Bank shall make a credit facility 
                         --------
          available to Borrower in the principal amount of TWO MILLION FIVE
          HUNDRED THOUSAND and 00/100 ($2,500,000.00) DOLLARS, the proceeds
          of which will be used by Borrower for capital expenditures
          related to increasing production capacity and efficiency at its
          production facility in Wilkes-Barre, Pennsylvania.

                    (b)  The Line.  The Bank shall make a credit facility
                         --------
          available to Borrower in the principal amount of FIVE MILLION AND
          00/100 ($5,000,000.00) DOLLARS which shall be used primarily for
          working capital.

                    (c)  Term and Interest.
                         -----------------

                         (i)  Revolver.  Unless terminated due to an Event
                              --------
          of Default (hereinafter defined) or unless converted to a term
          loan as hereinafter provided, the Revolver shall mature three (3)
          years from the date hereof, at which time all outstanding
          principal, accrued and unpaid interest and any and all other
          costs associated with the Revolver shall be due and payable. 
          Interest on the outstanding principal balance of the Revolver
          shall be paid monthly on all prime rate loans and on the earlier
          of the last day of the applicable rate period or quarterly for
          all LIBOR costs, whichever is sooner, based upon, and at
          Borrower's option, either:

                              A)   Bank's Prime Rate (hereinafter defined)
          minus one-half (1/2%) percent; or

                              B)   LIBOR Based Rate (hereinafter defined)
          plus 75 basis points; or

                              C)   Bank's Offered Rate (hereinafter
          defined).

               All rate requests shall be in writing on the Bank's Rate
          Notification Form.  Interest on all loans shall be computed on
          actual/360 basis.

               The Borrower shall have the option, at any time, to convert
          the outstanding principal balance of the Revolver to a term loan
          of either three (3) or five (5) years from the date of the
          exercise of the option (the "Term Loan Option").  In the event
          the Term Loan Option is exercised, Borrower shall repay the
          outstanding principal balance under the Term Loan Option in equal
          monthly payments of principal plus interest based upon the term
          selected.  Bank agrees to quote a fixed rate of interest option
          to the Borrower upon request.  Fixed rate loans may not be
          prepaid without penalty.  Bank shall advise Borrower of penalty
          upon Borrower's request for fixed rate loan.  All outstanding
          Term Loans shall reduce the availability for borrowing under the
          Revolver.

                         (ii) The Line.  Unless terminated due to an Event
                              --------
          of Default (hereinafter defined), the Line shall mature three (3)
          years from the date hereof, at which time all outstanding
          principal, accrued and unpaid interest and any and all other
          costs associated with the Line shall be due and payable.
          Interest on the outstanding principal balance of the Line shall
          be paid monthly based upon and at Borrower's option, either:

                              A)   Bank's Prime Rate (hereinafter defined)
          minus one-half (1/2%) percent; or

                              B)   LIBOR Based Rate (hereinafter defined)
          plus 75 basis points; or

                              C)   Bank's Offered Rate (hereinafter
          defined).

               The Bank's Prime Rate is a floating rate of interest that is
          designated from time to time by the Bank as the "Prime Rate" and
          is used by the Bank as a reference rate with respect to different
          interest rates charged to Borrower.  The rate of interest payable
          shall change simultaneously and automatically upon the Bank's
          designation of any change in such Prime Rate.  The Bank's
          determination and designation from time to time of the Prime Rate
          shall not in any way preclude the Bank from making loans to other
          borrowers at a rate which is higher or lower than or different
          from the Prime Rate.

               LIBOR Based Rate means the rate per annum (rounded upward,
          if necessary, to the nearest 1/16 of 1%) quoted at approximately
          11:00 a.m. London time, to the principal London branch of the
          Bank, two business days prior to the first day of the date on
          which the quoted rate is to become effective for the offering by
          leading banks in the London interbank market of dollar deposits
          in immediately available funds for a one, two, three or six month
          period as appropriate ("Interest Period"), and in an amount
          comparable to the unpaid principal balance of the Applicable
          Loan.  Interest Periods with respect to the LIBOR Based Rate
          means each 30, 60, 90 or 180 day period as elected by the
          Borrower commencing of the date hereof and ending on the date
          which is the numerically corresponding day in the first, second,
          third or sixth calendar month thereafter, provided that if an
          Interest Period would end on a day that is not a Business Day
          (hereinafter defined), such Interest Period shall be extended to
          the next succeeding Business Day, unless such Business Day would
          fall in the next calendar month, in which case such Interest
          Period shall end on the immediately preceding Business Day.

               The Bank's Offered Rate is a rate of interest quoted by the
          Bank, from time to time, as an interest rate that the Borrower
          has the option of selecting with respect to advances under this
          facility, the quotation and duration of which interest rate shall
          be offered to the Borrower from time to time by the Bank in its
          sole discretion.

               Notwithstanding anything contained herein to the contrary,
          upon and after the occurrence of an Event of Default which is not
          cured to the satisfaction of the Bank, interest shall accrue at
          an annual rate (before and after judgment) equal to the Prime
          Rate plus three percent (3%) per annum.

               Subject to the provisions of this Agreement, interest shall
          be payable by the Borrower monthly, in arrears, on the first day
          of each month, or as otherwise billed by the Bank.

               "Business Day" means any day other than a Saturday, Sunday
          or other day on which commercial banks in Philadelphia,
          Pennsylvania are authorized or required to close under the laws
          of the Commonwealth of Pennsylvania and a day on which dealings
          in United States dollar deposits are also are also carried on in
          the London interbank market and banks are open for business in
          London, England.

               No later than three (3) Business Days prior to the end of
          each relevant Interest Period in the case of renewal of a LIBOR
          Based Rate, the Borrower shall elect, in writing, the LIBOR Based
          Rate and Interest Period, Bank's Prime Rate minus one-half (1/2%)
          percent or Bank's Offered Rate.  Such election in the case of the
          LIBOR Based Rate, once made, shall be irrevocable and if no
          election is made three (3) Business Days prior to the end of each
          relevant Interest Period, the Borrower shall be deemed to have
          elected to pay interest at the Prime Rate minus one-half (1/2%)
          percent until such time as it elects by giving three (3) Business
          Days prior notice to pay interest at the LIBOR Based Rate for an
          Interest Period.  LIBOR Rate Loans may not be added to or prepaid
          prior to the expiration of their stated interest period without
          penalty.

               Upon prepayment of any LIBOR Rate Loan on a day other than
          the last day of the applicable Interest Period (whether
          voluntarily, involuntarily, by reason of acceleration, demand or
          otherwise), the Borrower shall pay to the Bank within five (5)
          Business Days after demand, an amount equal to the Bank's
          "funding costs", which shall mean the sum of:

                         (i)  the principal amount of the LIBOR Rate Loan
          prepaid, multiplied by the number of days between the date of
          prepayment and the last day of the applicable Interest Period,
          divided by 360, multiplied by the applicable Interest
          Differential (provided that the product of the foregoing formula
          must be a positive number); plus

                         (ii) all reasonable out-of-pocket expenses
          incurred by the Bank in connection with such payment, prepayment
          or failure to borrow.

          The Bank's determination of the amount of any "funding costs"
          payable under this paragraph shall be conclusive in the absence
          of manifest error.

               If the adoption of any applicable law, rule or regulation,
          or any change therein, or any change in the interpretation or
          administration thereof by any governmental authority, central
          bank or comparable agency charged with the interpretation or
          administration thereof, or compliance by the Bank with any
          request or directive of any such authority, central bank or
          comparable agency shall make it unlawful or impossible for any
          Bank to make, maintain or fund its LIBOR Rate Loans, the Bank
          shall give notice thereof to the Borrower, whereupon (until the
          Bank notifies the Borrower that the circumstances giving rise to
          such suspension no longer exist), the obligation of the Bank to
          make LIBOR Rate Loans shall be suspended.  If the Bank shall
          determine that it may not lawfully continue to maintain and fund
          any of its outstanding LIBOR Rate Loans to maturity and shall so
          specify in such notice, the Borrower shall immediately prepay in
          full the then outstanding principal amount of each such LIBOR
          Rate Loan, together with accrued interest thereon and any
          "funding costs" incurred by the Bank hereunder.

                    (d)  Method of Payments.  Borrower irrevocably 
                         ------------------
          authorizes Bank to debit its designated account for all payments
          due under the Loans.  The Bank shall furnish written verification
          of each payment charged against the account.  The Borrower shall
          promptly pay Bank such amounts as may be due if the designated
          account balance is insufficient.

                    (e)  Notes.  The Loans shall be evidenced by the 
                         -----
          Borrower's Notes of even date herewith (the "Notes"), the terms
          of which are incorporated herein by reference thereto.  If
          Borrower shall have the privilege of prepaying (as herein
          provided) the principal balance of the Notes, such prepayments
          shall be applied to the installments of the Note in inverse order
          of maturity and shall not postpone or interrupt the payment of
          monthly or other installments as they shall become due.

               SECTION 2.     CLOSING DOCUMENTS.
                              -----------------

                    This Loan Agreement, the documents referenced herein
          and those executed and exchanged at settlement are hereinafter
          sometimes collectively referred to as the "Loan Documents" and
          are incorporated herein by reference thereto.

               SECTION 3.     CLOSING AND DISBURSEMENTS.
                              -------------------------

                    (a)  The obligation of the Bank to close on the Loans
          shall be conditioned upon:

                         (i)  An opinion of counsel for the Borrower
          satisfactory to the Bank and its counsel, providing, among other
          things, that to the best of counsel's knowledge the
          representations and warranties of the Borrower contained in the
          Loan Documents are true and correct, that the Loan Documents
          executed and delivered to the Bank by the Borrower are valid and
          binding subject to appropriate reservation of creditors' rights
          language;

                         (ii) Its receipt of fully executed original copies
          of this Loan Agreement, the Loan Documents and any and all other
          documents reasonably requested by the Bank and its counsel;

                         (iii)     Its receipt of the tax identification
          numbers of Borrower; and

                         (iv)      Its receipt of the Articles of
          Incorporation and By-Laws of Borrower.

               SECTION 4.     EVENTS OF DEFAULT.  Each of the following 
                              -----------------
          shall constitute an Event of Default under the Loans ("Event of
          Default"), whatever the reason for such event and whether it
          shall be voluntary or involuntary, or within or without the
          control of the Borrower, or be effected by operations of law or
          pursuant to any judgment or order of any court or any order, rule
          or regulation of any governmental or non-governmental body:

                    (a)  Any payment of the principal, interest or other
          charges under or in connection with any of the Loans shall not be
          made within fifteen (15) days of their due date.

                    (b)  Any Representation or Warranty in the Loan
          Documents shall prove to have been incorrect or misleading when
          made, in any material respect.

                    (c)  Borrower shall (i) become insolvent, (ii) admit
          its inability to pay its debts as they become due, (iii) make an
          assignment for the benefit of its creditors, (iv) be adjudicated,
          bankrupt or insolvent, (v) voluntarily initiate proceedings under
          any present or future bankruptcy or reorganization law, or (vi)
          become the subject of any involuntary proceedings under any
          present or future bankruptcy or reorganization law that shall not
          have been discharged within sixty (60) days after commencement of
          such proceedings.

                    (d)  The Borrower shall fail to observe or perform any
          other agreement or covenant contained in any of the Loan
          Documents not cured within thirty (30) days of written notice to
          Borrower from Bank (such notice period being concurrent with and
          not in addition to any other notice period that may be specified
          in any of the other Loan Documents), provided, however, that Bank
          may, in its sole discretion, allow Borrower to pursue a cure of
          the default if it is incapable of being cured within the thirty
          (30) day period and Borrower diligently pursues a cure.

                    (e)  The Borrower or any Subsidiary of the Borrower
          shall fail to pay any indebtedness for borrowed money (other than
          the Notes) of the Borrower or such Subsidiary, as the case may
          be, or any interest or premium thereon, when due (whether by
          scheduled maturity, required prepayment, acceleration, demand or
          otherwise) after the giving of any required notice or the
          expiration of any grace or cure period, or any such indebtedness
          shall be declared to be due and payable or required to be prepaid
          (other than by a regularly scheduled required prepayment), prior
          to the stated maturity thereof; or

                    (f)  The entry of any judgment against the Borrower or
          any Subsidiary thereof or the issuing of any attachment or
          garnishment against any property of the Borrower or any
          Subsidiary thereof in the aggregate amount of $250,000 which
          judgment, attachment or garnishment shall continue unsatisfied
          and in effect for a period of 20 consecutive days (following
          notice from the creditor and/or Bank and/or any other reliable
          party) without being vacated, discharged, satisfied or bonded
          pending appeal; or

                    (g)  The dissolution, merger, consolidation,
          reorganization or change in control (as "control" is defined in
          Rule 12b-2 under the Securities Exchange Act of 1934, as amended)
          of the Borrower or any Subsidiary thereof or the sale or transfer
          of any substantial portion of the Borrower's assets; or

                    (h)  Any "Event of Default" shall occur under the terms
          of any of the Loan Documents.

               SECTION 5.     CROSS-DEFAULT OF LOANS.
                              -----------------------

                    The Borrower agrees, covenants and represents that a
          default under either of the Loans shall constitute a default
          under all of the Loans and would allow Bank the right to exercise
          any of its remedies with respect to any of the Loans.

               SECTION 6.     REMEDIES.  Upon the occurrence and during the
                              --------
          continuance of any Event of Default, and in every such event, the
          Bank shall have the right, after the expiration of any applicable
          notice and cure period, to:

                    (a)  Declare the outstanding principal of, and all
          unpaid and accrued interest on the Loans, and all other amounts
          owed by the Borrower under this Agreement with respect to the
          Loans or otherwise to the Bank (whenever or howsoever arising,
          and whether or not then due) to be, and such principal, interest
          and other amounts shall thereupon become immediately due and
          payable;

                    (b)  Exercise all rights and remedies specified in this
          Agreement and/or the other Loan Documents; and

                    (c)  Exercise all other rights and remedies available
          at law or at equity.

                    Presentment, demand, promise or notice of any kind are
          hereby expressly waived.  The Bank's rights and remedies shall be
          cumulative and not exclusive, may be exercised from time to time,
          and need not be exercised in any given order.

                    The Bank shall further be entitled to be reimbursed for
          any and all reasonable costs incurred by it in exercising its
          remedies.

               SECTION 7.     WARRANTIES AND REPRESENTATIONS.  The Borrower
                              ------------------------------
          warrants and represents to the Bank and agree that:

                    (a)  Borrower is a Pennsylvania corporation, duly
          organized, validly existing and in good standing under the laws
          of the Commonwealth of Pennsylvania and that Borrower has the
          power and authority to own its property and assets, to carry on
          its business as is now being conducted and is qualified to do
          business in every jurisdiction in which it is required to qualify
          to do business.

                    (b)  no consent of any party is required in connection
          with the Borrower's execution, delivery, performance, validity or
          enforceability of the Loan Documents.

                    (c)  the Borrower has the power to execute, deliver and
          perform this Agreement and the other Loan Documents, and when
          executed and delivered, this Agreement and the other Loan
          Documents will be valid and binding obligations of the Borrower
          enforceable in accordance with their respective terms.

                    (d)  the execution, delivery and performance of this
          Agreement and the other Loan Documents has been duly authorized
          by all corporate and legal action required for the lawful
          creation and issuance of such documents by the Borrower will not
          violate any provision of any law, any order of any court or
          governmental agency or the By-Laws of the Borrower.

                    (e)  the execution, delivery and performance of this
          Agreement and the other Loan Documents will not violate any
          provision of any contract to which the Borrower's properties or
          assets are bound, and will not be in conflict with, result in a
          breach of, or constitute (with due notice and/or lapse of time) a
          default under any such Contract or result in the creation or
          imposition of any lien, charge, or encumbrance of any nature
          whatsoever upon any of the properties or assets of the Borrower.

                    (f)  except as disclosed in the Schedule attached
          hereto, there are no actions, suits or proceedings before any
          court or governmental department or agency pending, or to the
          knowledge of the Borrower, threatened (i) with respect to any of
          the transactions contemplated by the Loan Documents or (ii)
          against or affecting the Borrower or any of its properties which,
          if adversely determined, would have a material adverse affect on
          the financial condition, business or operations of the Borrower
          or upon its ability to perform any of its obligations under the
          Loan Documents.  The Borrower is not in default with respect to
          any judgment, order, writ, injunction, decree, rule or regulation
          of any court or federal, state, municipal or other governmental
          department or agency, which default would have a material adverse
          affect on the financial condition, business operations of the
          Borrower or upon its ability to perform any of its obligations
          under the Loan Documents.

                    (g)  the Borrower is not in default under any material
          existing agreement, and no event has occurred which, with the
          giving of notice or passage of time, or both, would constitute an
          Event of Default hereunder as of the date hereof.

                    (h)  the Borrower has filed or caused to be filed all
          tax returns and reports required by law and have paid all taxes
          shown to be due and payable on said returns or reports or on any
          assessments made against it.  No tax liens have been filed
          against any asset of the Borrower and no claims are being
          asserted with respect to such taxes which could have a material
          adverse affect on the financial condition, business or operations
          of the Borrower.

                    (i)  the Borrower is in compliance with, and has
          received no notice of non-compliance with respect to all federal,
          state and local laws relating to the conduct of its business.

                    (j)  all financial information regarding the Borrower
          which has been or will be furnished to the Bank is, or will be
          when furnished, true and correct and does or will when furnished
          represent fairly, accurately and completely, the financial
          condition of the Borrower and the results of its operations as of
          the dates and for the periods for which the same were furnished. 
          All such financial statements of the Borrower will have been
          prepared in accordance with the generally accepted accounting
          principals ("GAAP").  There are no liabilities, direct or
          indirect, fixed or contingent, of the Borrower of a character
          which under GAAP should have been but were not reflected in such
          financial statements or in the notes thereto.

                    (k)  the proceeds of the Loans shall be used solely and
          exclusively as provided in Section 1 hereof.

               SECTION 8.     AFFIRMATIVE COVENANTS.  Borrower hereby 
                              ---------------------
          covenants and agrees that:

                    (a)  Borrower shall furnish to the Bank, within ninety-
          one (91) days after the close of each fiscal year, audited
          financial statements, together with its annual 10-K financial
          reports, all supporting schedules and notes, and accompanied by
          an opinion thereon to the Bank by an independent certified public
          accountant satisfactory to the Bank.  The statements will be
          prepared in accordance with GAAP.

                    (b)  Borrower shall furnish to the Bank, within forty-
          five (45) days of the close of each fiscal quarter, its 10-Q
          quarterly financial reports, certified by the Chief Financial
          Officer of the Borrower as having been prepared in accordance
          with GAAP.

                    (c)  Borrower shall provide the Bank within thirty (30)
          days after the end of each fiscal year, with its annual
          projection and budget for the immediately succeeding fiscal year.

                    (d)  Borrower shall maintain and keep all of its
          property in good repair, working order and condition or make or
          cause to be made all necessary or appropriate repairs, renewals,
          replacements, substitutions, additions, betterments and
          improvements thereto so that the efficiency of all such property
          shall at all times be properly preserved and maintained.

                    (e)  Borrower shall duly pay and discharge all taxes,
          assessments and governmental charges levied upon or assessed
          against it or against its properties or income prior to the date
          on which penalties are attached thereto, unless and except to the
          extent only that such taxes and assessments and charges shall be
          contested in good faith and by appropriate proceedings diligently
          conducted by it (unless and until foreclosure, distraint, sale or
          other similar proceedings shall have been commenced) and provided
          that such reserve or other appropriate provisions, if any, as
          shall be required by GAAP shall have been made therefore.

                    (f)  Borrower shall promptly give notice, in writing,
          to the Bank of the occurrence of any material litigation,
          arbitration or governmental proceeding affecting it and of any
          governmental investigation or labor dispute pending or, to its
          knowledge, threatened, which could reasonably be expected to
          interfere substantially with its normal operations or materially
          adversely affect its financial condition.

                    (g)  Borrower shall maintain and keep proper records
          and books of account in conformance with GAAP applied on a
          consistent basis and to which full, true and correct entries
          shall be made of all of its dealings and business affairs.

                    (h)  Borrower shall permit any of the officers,
          employees or representatives of the Bank to visit and to examine
          and copy the books and records and discuss their affairs,
          finances and accounts during normal business hours, and as often
          as the Bank may reasonably request subject to reasonable prior
          notice to Borrower and opportunity to be present and participate
          in any such examination and/or discussions.  The Bank shall
          exercise its customary care in maintaining the confidentiality of
          such information.

                    (i)  Borrower shall keep all insurable property, real
          and personal, now owned or hereinafter acquired, insured at all
          times against loss or damage by fire and extended coverage risks
          and other hazards of the kinds customarily insured against and in
          amounts customarily carried by businesses engaged in comparable
          businesses and comparably situated and promptly from time to time
          upon request of the Bank, deliver to the Bank a summary schedule
          indicating all insurance then in effect, together with all such
          policies, certificates of insurance and such other information
          relating thereto as the Bank may, from time to time, request.

                    (j)  Borrower shall preserve and protect each of its
          patents, franchises, licenses, trademarks and trademark rights,
          trade name, trade name rights, and copyrights used or useful in
          the conduct of its business.  Changes to brands and/or labels in
          the ordinary course of Borrower's business shall be excluded from
          this provision.

                    (k)  Borrower shall maintain, obtain (to the extent
          necessary) and comply, in all material respects, with all
          required permits, licenses, registrations, and approvals relating
          to its operations.

                    (l)  Borrower shall comply, in all material respects,
          with all laws, rules, regulations and governmental orders and
          directives relating to the generation, treatment, storage,
          transportation, disposal and release into the environment and
          clean up of any hazardous or toxic waste or substance which is
          subject to the provisions of any federal, state or local
          environmental statute or regulation.

                    (m)  Borrower shall notify the Bank if it receives (i)
          any notice from any governmental agency that it is a potentially
          responsible party in any proceeding under federal, state or local
          environmental statutes or regulations, (ii) any notice of any
          claim, proceeding, litigation, order, directive, citation or
          request for information concerning environmental condition, or
          notice of any alleged violation of any environmental statute,
          ordinance, regulation or permanent condition, or (iii) any
          information concerning any potentially adverse environmental
          condition, including but not limited to, any spilling, leaking,
          discharge, release or threat of release of any hazardous or toxic
          waste or substance.

                    (n)  Borrower shall promptly give notice, in writing,
          to the Bank, of the occurrence of any Event of Default and of any
          condition, event, act or omission which, with the given of notice
          or the lapse of time or both, would constitute an Event of
          Default hereunder or under the other Loan Documents, or under any
          agreement or document securing, evidencing or relating to the
          Loan Documents.

                    (o)  Except as set forth herein, all other lines of
          credit of the Borrower shall be cancelled or terminated.

               SECTION 9.     NEGATIVE COVENANTS.  Borrower hereby 
                              ------------------
          covenants and agrees that:

                    (a)  Borrower will not undergo a change in control or
          ownership absent the written consent of the Bank.

                    (b)  Borrower shall not violate any applicable law to
          the extent that the consequences of any such violation may have a
          material adverse affect on its financial condition or operations
          or may impair its ability to perform its obligations under the
          Loan Documents.

                    (c)  Borrower shall not, except for sales or other
          dispositions of inventory in the ordinary course of business,
          sell, lease, transfer, or otherwise dispose of in a single
          transaction, or a series of related transactions, all or any
          material part of its property or assets, whether now owned or
          hereinafter acquired, to any person, firm or corporation; nor
          sell, assign or discount any of its accounts receivable or any
          promissory note held by it, with or without recourse.

                    (d)  Borrower shall not, in the aggregate, incur
          additional indebtedness (including capital leases) and/or pledge
          its assets in excess of $250,000.00 per year without the Bank's
          prior written consent.

               SECTION 10.    FINANCIAL COVENANTS.  Borrower hereby 
                              -------------------
          covenants and agrees that:

                    (a)  The Borrower will maintain a ratio of current
          assets to current liabilities of not less than 1.50 to 1.00 as of
          the end of each fiscal quarter during the term of this Agreement
          commencing with the Borrower's fiscal year beginning October 1,
          1996.  The outstanding balances under the revolver and line of
          credit facility referred to herein shall be excluded from this
          ratio.

                    (b)  The Borrower will maintain at the end of each
          fiscal quarter a combined ratio of total debt to Tangible Net
          Worth of no greater than .75 to 1.00.

                    (c)  The Borrower will maintain on a rolling four
          quarter basis a combined Debt Service Coverage Ratio of at least
          1.50 to 1.00.  As used herein, "Debt Service Coverage Ratio"
          shall be calculated as follows:  the sum of (1) net income after
          taxes plus depreciation and amortization minus dividends and
          unfunded capital expenditures paid of the Borrower; divided by
          (2) the combined current maturities of long term debt plus
          capital leases of the Borrower for that period.  The outstanding
          balances under the revolver and line of credit facility referred
          to herein shall be excluded from this ratio.

               SECTION 11.    DEPOSIT RELATIONSHIP.  The Borrower agrees 
                              --------------------
          that all operating and cash management accounts will be
          maintained at the Bank.

               SECTION 12.    DISCLAIMER OF RELATIONSHIPS.  The Borrower 
                              ---------------------------
          acknowledges that nothing contained in this Agreement or in the
          other Loan Documents, or any act of the Bank, shall be deemed or
          construed to create any relationship of a third-party
          beneficiary, or of principal or agent, or of limited or general
          partnership, or of joint venture, or of any association or
          relationship between the Borrower and the Bank other than that of
          debtor and creditor.

               SECTION 13.    NOTICES.  All notices to be given by any 
                              -------
          party as required hereunder shall be in writing and shall be
          addressed as follows:

                    Bank:            Corestates Bank, N.A.
                                     130 Wyoming Avenue
                                     Scranton, PA  18503
                                     Attention:  Frank Heston,
                                                 Assistant Vice President


                    With a copy to:  Joseph L. Persico, Esquire
                                     Rosenn, Jenkins & Greenwald, L.L.P.
                                     15 South Franklin Street
                                     Wilkes-Barre, PA  18711


                    Borrower:        The Lion Brewery, Inc. 
                                     700 North Pennsylvania Avenue
                                     Wilkes-Barre, PA  18705
                                     Attention:  Patrick Belardi,
                                                 Vice-President


                    With a copy to:  Alan Kluger, Esquire
                                     Hourigan, Kluger, Spohrer & Quinn
                                     Suite 700, Mellon Bank Center
                                     8 West Market Street
                                     Wilkes-Barre, PA  18711

                    Notices shall be delivered by either an independent
          courier service that obtains a receipt for delivery or certified
          or registered United States Postal Service mail, return receipt
          requested.  Any party hereto may change their address for notices
          by written notice to the other parties as aforesaid.

               SECTION 14.    EXPENSES.  The Borrower shall pay, or 
                              --------
          reimburse the Bank for (i) out-of-pocket expenses in connection
          with the preparation, execution and delivery of any waiver,
          amendment or consent by the Bank relating to the Loan Documents
          and (ii) all costs of obtaining performance under the Loan
          Documents by the Borrower, and all costs of collection if Default
          is made in the payment of the Loan or any other amount payable
          hereunder and all costs of realizing upon any security for any
          obligation hereunder, which costs shall include reasonable
          counsel fees and expenses.

               SECTION 15.    RIGHTS CUMULATIVE:  NO IMPLIED WAIVERS OF 
                              -----------------------------------------
          RIGHTS.  The rights and remedies of the Bank under this Agreement
          ------
          and under the other Loan Documents shall be cumulative and not
          exclusive of any rights or remedies that it would otherwise have,
          and no failure or delay by the Bank in exercising any right shall
          operate as a waiver of such right, nor shall any single or
          partial exercise of any power or right preclude its other or
          further exercise or the exercise of any other power or right.

               SECTION 16.    SET-OFF.  Upon and after the occurrence of 
                              -------
          any Event of Default by the Borrower, the Bank is hereby
          authorized by the Borrower, at any time and from time to time,
          without notice, (i) to set-off against, and to appropriate and
          apply to the payment of the obligations and liabilities of the
          Borrower under the Loan Documents (whether matured or unmatured,
          fixed or contingent or liquidated or unliquidated), any and all
          amounts owing by the Bank to the Borrower (whether payable in
          Dollars or any other currency, whether matured or unmatured, and,
          in the case of deposits, whether general or special, time or
          demand and however evidenced) and (ii) pending any such action,
          to the extent necessary, to hold such amounts as collected to
          secure such obligations and liabilities and to return as unpaid
          for insufficient funds any and all checks and other items drawn
          against and deposits so held as the Bank in its sole discretion
          may elect.

               SECTION 17.    INDEMNIFICATION.  Borrower shall, and does 
                              ---------------
          hereby, indemnify the Bank, its successors and assigns, and hold
          them harmless, of and from any and all claims, demands and
          liabilities whatsoever (except to the extent the same was the
          result of Bank's negligence, willful misconduct or knowing
          violations of law), including the reasonable costs of attorney's
          fees and other defense costs, fines or other penalties or
          payments, arising from the making of the Loans by the Bank, or
          any other relationship, real or asserted, between the Bank and
          the Borrower especially including, but specifically not limited
          to any claims, demands or liabilities, asserted or arising under
          any federal, state or local environmental law and any other
          failure to comply in all respects with all environmental laws,
          regulations, ordinances or administrative orders which may effect
          the same, now or in the future.  This indemnification is intended
          to, and shall, survive payment in full of the Loans.

               SECTION 18.    ACKNOWLEDGEMENT OF CONFESSION OF JUDGMENT 
                              -----------------------------------------
          PROVISIONS.
          ----------

               THE BORROWER ACKNOWLEDGES AND AGREES THAT THE LOAN DOCUMENTS
          CONTAIN PROVISIONS WHEREBY THE BANK MAY UPON CERTAIN
          CIRCUMSTANCES ENTER JUDGMENT BY CONFESSION AGAINST THE BORROWER,
          BEING FULLY AWARE OF THE BORROWER'S WAIVER OF RIGHTS TO PRIOR
          NOTICE AND HEARING ON THE QUESTION OF THE VALIDITY OF ANY CLAIMS
          THAT MAY BE ASSERTED AGAINST THE BORROWER BY THE BANK UNDER THE
          LOAN DOCUMENTS, BEFORE JUDGMENT CAN BE ENTERED.  THE BORROWER
          HEREBY CONSENTS TO THE BANK ENTERING JUDGMENT AGAINST THE
          BORROWER BY CONFESSION AS PROVIDED IN THE LOAN DOCUMENTS.  ANY
          PROVISION IN A CONFESSION OF JUDGMENT IN ANY OF THE LOAN
          DOCUMENTS FOR AN ATTORNEY'S COLLECTION COMMISSION SHALL IN NO WAY
          LIMIT ANY OF THE BORROWER'S LIABILITY TO REIMBURSE THE BANK FOR
          ALL LEGAL FEES ACTUALLY INCURRED BY THE BANK, EVEN IF SUCH FEES
          ARE IN EXCESS OF THE ATTORNEY'S COLLECTED COMMISSION PROVIDED FOR
          IN SUCH CONFESSION OF JUDGMENT.

               THE BORROWER HEREBY KNOWINGLY AND INTELLIGENTLY, IRREVOCABLY
          WAIVES ANY RIGHT WHICH THE BORROWER HAS OR MAY HAVE TO A HEARING
          PRIOR TO THE ISSUANCE OF EXECUTION PROCESS AGAINST THE BORROWER
          PURSUANT TO A JUDGMENT OBTAINED BY THE BANK (WHETHER BY
          CONFESSION OR OTHERWISE), AND AGREES TO INDEMNIFY AND HOLD
          HARMLESS THE BANK, ITS AGENTS, ATTORNEYS, EMPLOYEES, SUCCESSORS
          AND ASSIGNS FROM AND AGAINST ANY AND ALL LIABILITY ASSOCIATED
          WITH SUCH EXECUTION PROCESS.

               SECTION 19.    WAIVER OF JURY TRIAL.  THE BORROWER AND THE 
                              --------------------
          BANK WAIVE ANY RIGHT TO TRIAL BY JURY ON ANY CLAIM, DEMAND,
          ACTION OR CAUSE OF ACTION (a) ARISING UNDER ANY OF THE LOAN
          DOCUMENTS, OR (b) IN ANY WAY CONNECTED WITH OR RELATED OR
          INCIDENTAL TO THE DEALINGS OF THE BORROWER OR THE BANK WITH
          RESPECT TO ANY OF THE LOAN DOCUMENTS OR THE TRANSACTIONS RELATED
          HERETO OR THERETO, IN EACH CASE WHETHER SOUNDING IN CONTRACT OR
          TORT OR OTHERWISE.  THE BORROWER AND THE BANK AGREE AND CONSENT
          THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE
          DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS
          AGREEMENT MAY FILE AN ORIGINAL COUNTER PART OR A COPY OF THIS
          SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
          BORROWER AND THE BANK TO THE WAIVER OF THEIR RIGHTS TO TRIAL BY
          JURY.  THE BORROWER ACKNOWLEDGES THAT IT HAS HAD THE OPPORTUNITY
          TO CONSULT WITH COUNSEL REGARDING THIS SECTION, THAT IT FULLY
          UNDERSTAND ITS TERMS, CONTENT AND EFFECT, AND THAT IT VOLUNTARILY
          AND KNOWINGLY AGREE TO THE TERMS OF THIS SECTION.

               SECTION 20.    SURVIVAL OF COVENANTS.  All covenants, 
                              ---------------------
          agreements, representations and warranties made by the Borrower
          in the Loan Documents are made by or on its behalf in connection
          with the transactions contemplated herein shall be true in all
          material respects at all times this Agreement is in effect and
          shall survive the execution and delivery of the Loan Documents,
          any investigation at any time made by the Bank or on its behalf
          in the making by the Bank of the Loans to the Borrower.  All
          statements contained in any certificate, statement or other
          documents delivered by or on behalf of the Borrower pursuant
          hereto or in connection with the transactions contemplated
          hereunder shall be deemed representations and warranties by the
          Borrower.

               SECTION 21.    NO ASSIGNMENT.  The Borrower may not assign 
                              -------------
          any of its rights hereunder without the prior written consent of
          the Bank and the Bank shall not be required to lend hereunder
          except to the Borrower as it presently exists.

               SECTION 22.    PARTICIPATION.  The Bank may sell, assign or
                              -------------
          participate all or any portion of its interest in the Loan
          Documents and in connection therewith may make available to any
          prospective purchaser, assignee or participant any information
          relative to the Borrower in its possession.

               SECTION 23.    NO THIRD PARTY RIGHTS.  The rights and 
                              ---------------------
          benefits of this Agreement and the other Loan Documents shall not
          inure to the benefit of any third party.

               SECTION 24.    INTEGRATION.  The Loan Documents shall be 
                              -----------
          construed as integrated and complementary of each other, and as
          augmenting and not restricting the rights, powers, remedies and
          security of the Bank.  The Loan Documents contain the entire
          understanding of the parties thereto with respect to the matters
          contained therein and supersede all prior agreements and
          understandings between the parties with respect to the subject
          matter thereof and do not require parol or extrinsic evidence in
          order to reflect the intent of the parties.  In the event of any
          inconsistency between the terms of this Agreement and the terms
          of the other Loan Documents, the terms of this Agreement shall
          prevail.

               SECTION 25.    WAIVERS.  The provision of this Agreement 
                              -------
          may, from time to time, be waived in writing by the Bank in its
          sole discretion.  Any such waiver of any kind on the part of the
          Bank of any breach or default under this Agreement or any waiver
          of any provision or condition of this Agreement must be in
          writing and shall be effective only to the extent set forth in
          such writing.  No delay by the Bank in exercising any right or
          remedy hereunder shall operate as a waiver thereof.

               SECTION 26.    BINDING NATURE.  The rights and privileges of
                              --------------
          the Bank contained in this Agreement shall inure to the benefit
          of its successors and assigns, and the duties of the Borrower
          shall bind all of its successors and assigns.

               SECTION 27.    GOVERNING LAW.  Time of performance hereunder
                              -------------
          is of the essence of this Agreement.  This Agreement and any
          written supplement hereto executed by the Borrower in which
          reference to this Agreement is made shall in all respects be
          governed by the laws of the Commonwealth of Pennsylvania (except
          to the extent that federal law governs).

               SECTION 28.    SEVERABILITY.  If any provision hereof shall
                              ------------
          for any reason be held invalid or unenforceable, no other
          provision shall be affected thereby, and this Agreement shall be
          construed as if the invalid or unenforceable provision had never
          been a part of it.  The descriptive headings hereof are for
          convenience only and shall not in any way affect the meaning or
          construction of any provisions hereof.

               SECTION 29.    EXECUTION OF COUNTERPARTS. This Agreement may
                              -------------------------
          be executed in as many counterparts as may be deemed necessary by
          the parties, each of which, when so executed, shall be deemed an
          original, but all such counterparts shall constitute one and the
          same instrument.


                               [SIGNATURE PAGE FOLLOWS]


          <PAGE>


               IN WITNESS WHEREOF, and intending to be legally bound
          thereby, the parties hereto have hereunder set their respective
          hands and seals the day and year first above written.

          ATTEST:                            BANK:

                                             CORESTATES BANK, N.A.



          /s/                                /s/
          ______________________        By:  ______________________________
                                             Its: _________________________

             (Corporate Seal)




          ATTEST:                            BORROWER:

                                             THE LION BREWERY, INC.



          /s/                                /s/
          ______________________        By:  ______________________________
                                             Its: _________________________

             (Corporate Seal)