SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K

                        FOR ANNUAL AND TRANSITION REPORTS
                     PURSUANT TO SECTIONS 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

(Mark One)

[X]          ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
             EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 1996
                                       OR

[ ]          TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
             EXCHANGE ACT OF 1934

For the transition period from ________________________ to _____________________

                         Commission file number 1-11200

                               SILGAN CORPORATION
          ------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

        Delaware                                          06-1207662
------------------------                    ------------------------------------
(State of incorporation)                    (I.R.S. Employer Identification No.)

4 Landmark Square, Stamford, Connecticut                   06901
----------------------------------------                 ----------
(Address of principal executive offices)                 (Zip Code)

        Registrant's telephone number, including area code (203) 975-7110

        Securities registered pursuant to Section 12(b) of the Act: None
        Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  Registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days. Yes [X]   No [ ]

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best of Registrant's  knowledge,  in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.  [X]

None of the registrant's  voting stock was held by non-affiliates as of February
28, 1997.

As of  February  28,  1997,  the  number  of shares  outstanding  of each of the
registrant's classes of common stock is as follows:

Classes of shares of common stock                          Number of shares
  outstanding,  $0.01 par value                              outstanding
---------------------------------                          ----------------
           Class A                                                1
           Class B                                                1
           Class C                                                0

                    Documents Incorporated by Reference: None



<PAGE>



                                TABLE OF CONTENTS


                                                                           Page
                                                                           ----

PART I.....................................................................   1
      Item 1.     Business.................................................   1
      Item 2.     Properties...............................................  12
      Item 3.     Legal Proceedings........................................  13
      Item 4.     Submission of Matters to a Vote of Security Holders......  14

PART II....................................................................  15
      Item 5.     Market for Registrant's Common Equity and Related
                    Stockholder Matters....................................  15
      Item 6.     Selected Financial Data..................................  15
      Item 7.     Management's Discussion and Analysis of Financial
                    Condition and Results of Operations....................  19
      Item 8.     Financial Statements and Supplementary Data..............  31
      Item 9.     Changes in and Disagreements with Accountants on
                    Accounting and Financial Disclosure....................  31

PART III...................................................................  32
      Item 10.    Directors and Executive Officers of the Registrant.......  32
      Item 11.    Executive Compensation...................................  35
      Item 12.    Security Ownership of Certain Beneficial Owners and
                    Management.............................................  40
      Item 13.    Certain Relationships and Related Transactions...........  44

PART IV....................................................................  47
      Item 14.    Exhibits, Financial Statements, Schedules, and Reports
                    on Form 8-K............................................  47



                                       -i-

<PAGE>


                                     PART I

Item 1.  Business

General

         Silgan Corporation ("Silgan", and together with its direct and indirect
owned subsidiaries,  the "Company"), is a leading North American manufacturer of
consumer goods packaging products that currently produces (i) steel and aluminum
containers for human and pet food, (ii) custom designed  plastic  containers for
personal care, health, food,  pharmaceutical and household chemical products and
(iii) specialty  packaging  items,  including  metal caps and closures,  plastic
bowls and paper containers used by processors in the food industry.  The Company
is the largest  manufacturer of metal food  containers in North America,  with a
unit sale market share for the twelve  months  ended  October 31, 1996 of 35% in
the United States, and is a leading  manufacturer of plastic containers in North
America  for  personal  care  products.  The  Company's  strategy is to increase
shareholder  value by growing its existing  businesses  and expanding into other
segments by applying its  expertise in  acquiring,  financing,  integrating  and
efficiently operating consumer goods packaging businesses.

         The  Company  was  founded in 1987 by its  current  Co-Chief  Executive
Officers.  Since its  inception,  the  Company  has  acquired  and  successfully
integrated ten businesses,  including the recent  acquisitions of  substantially
all of the  assets  of the Food  Metal  and  Specialty  business  ("AN  Can") of
American  National  Can Company  ("ANC") in August 1995 for a purchase  price of
approximately  $362.0 million  (including net working  capital of  approximately
$156.0 million) and the U.S. metal container  manufacturing  business ("DM Can")
of Del Monte  Corporation ("Del Monte") in December 1993 for a purchase price of
approximately  $73.3 million  (including  net working  capital of  approximately
$21.9  million).  In  addition,  on October 9, 1996 the  Company  completed  its
acquisition of Finger Lakes Packaging Company,  Inc. ("Finger Lakes"), the metal
food container  manufacturing  subsidiary of Curtice Burns Foods, Inc. ("Curtice
Burns").  See  "--Company  History" and "--Recent  Developments".  The Company's
strategy  has  enabled it to  rapidly  increase  its net sales and  income  from
operations.  The Company's net sales have  increased from $630.0 million in 1992
to  $1,405.7  million in 1996,  representing  a compound  annual  growth rate of
approximately  22%. During this period,  income from  operations  increased from
$42.8 million in 1992 to $124.7 million in 1996,  representing a compound annual
growth rate of approximately  31%, while the Company's income from operations as
a percentage of net sales increased 2.1 percentage points from 6.8% to 8.9% over
the same period.

         The  Company's   philosophy,   which  has  contributed  to  its  strong
performance since inception,  is based on: (i) a significant equity ownership by
management  and an  entrepreneurial  approach  to  business,  (ii)  its low cost
producer position and (iii) its long-term customer relationships.  The Company's
senior  management has a significant  ownership  interest in the Company,  which
fosters  an  entrepreneurial  management  style and  places a  primary  focus on
creating  shareholder value. The Company has achieved a low cost producer status
through  (i) the  maintenance  of a flat,  efficient  organizational  structure,
resulting in low selling, general and administrative expenses as a percentage of
total  net  sales,  (ii)  purchasing   economies,   (iii)  significant   capital
investments that have generated manufacturing and production efficiencies,  (iv)
plant consolidations and rationalizations and (v) the proximity of its plants to
its  customers.  The  Company's  philosophy  has also been to develop  long-term
customer  relationships by acting in partnership  with its customers,  providing
reliable quality and service and utilizing its low cost producer position.  This
philosophy has resulted in numerous  long-term supply contracts,  high retention
of customers'  business and recognition  from its customers,  as demonstrated by
many quality and service awards.



                                       -1-

<PAGE>



  Growth Strategy

         The Company  intends to enhance its  position as a leading  supplier of
consumer goods packaging  products by aggressively  pursuing a strategy designed
to achieve  future growth and to increase  profitability.  The key components of
this  strategy  are to (i) increase  the  Company's  market share in its current
business  lines  through  acquisitions  and  internal  growth,  (ii) expand into
complementary business lines by applying the Company's acquisition and operating
expertise to other areas of the North American  consumer goods packaging  market
and (iii) improve the profitability of acquired businesses through  integration,
rationalization  and capital  investments  to enhance  their  manufacturing  and
production efficiency.

         Increase Market Share Through  Acquisitions  and Internal  Growth.  The
Company has  increased  its revenues  and market  share in the metal  container,
plastic  container  and  specialty  markets  through  acquisitions  and internal
growth.  As a result of this strategy,  the Company has diversified its customer
base,  geographic  presence and product line.  Management  believes that certain
industry  trends  exist  which will  enable the  Company to  continue to acquire
attractive businesses in its existing markets. For example,  during the past ten
years, the metal container market has experienced significant  consolidation due
to the desire by food  processors to reduce costs and deploy  resources to their
core operations. Self-manufacturers are increasingly outsourcing their container
needs  by  selling  their  operations  to  commercial  container   manufacturing
companies  and  agreeing  to  purchase  containers  from the buyer  pursuant  to
long-term  contracts.   The  Company's   acquisitions  of  the  metal  container
manufacturing  operations  of the  Nestle  Food  Company  ("Nestle"),  The  Dial
Corporation  and Del  Monte  reflect  this  trend.  As a  result  of its  growth
strategy,  the Company has more than tripled its overall share of the U.S. metal
food container market from  approximately  10% in 1987 to approximately  35% for
the twelve months ended October 31, 1996. The Company expects this consolidation
trend to continue as  evidenced  by its  October 9, 1996  acquisition  of Finger
Lakes. See "--Recent Developments". The Company's plastic container business has
also increased its market position  primarily  through  strategic  acquisitions,
from a sales  base of $88.8  million  in 1987 to  $216.4  million  in 1996.  The
plastic  container  segment of the consumer goods  packaging  industry is highly
fragmented, and management intends to pursue consolidation opportunities in that
segment.

         The  Company  also  expects  to  generate  internal  growth  due to its
participation  in certain higher growth segments of the consumer goods packaging
market.  For example,  due to increasing  consumer  preference  for plastic as a
substitute for glass, the Company is aggressively pursuing opportunities for its
custom designed polyethylene terephthalate ("PET") and high density polyethylene
("HDPE")  containers.  These opportunities  include producing PET containers for
regional bottled water companies,  and HDPE and PET containers for products such
as shampoo, mouthwash, salad dressing and liquor. The Company also believes that
there will be  opportunities to expand its specialty  business,  which generated
net sales of $90.7  million  in 1996.  Specialty  products  manufactured  by the
Company include metal closures for vacuum sealed glass containers,  its licensed
Omni plastic  container,  a plastic,  microwaveable bowl with an easy-open metal
end, and paper containers.

         Expand  into   Complementary   Business  Lines  Through   Acquisitions.
Management believes that it can successfully apply its acquisition and operating
expertise to new segments of the consumer goods packaging industry. For example,
with the AN Can acquisition,  the Company  expanded its specialty  business into
metal caps and  closures and its licensed  Omni  plastic  container.  Management
believes  that  certain  trends in and  characteristics  of the  North  American
consumer  goods  packaging   industry  will  continue  to  generate   attractive
acquisition  opportunities  in  complementary  business  lines.  The  Company is
focused  on  the  North  American  consumer  goods  packaging  industry,   which
represents a significant part of the $95 billion North American packaging market
(based on estimated total sales in 1994). Importantly,


                                       -2-

<PAGE>



the  industry  is  also   fragmented,   with  numerous   segments  and  multiple
participants  in  each  of  them.  In  addition,  many  of  these  segments  are
experiencing consolidation.

         Enhance  Profitability  of Acquired  Companies.  The  Company  seeks to
acquire   businesses   at  reasonable   cash  flow   multiples  and  to  enhance
profitability by rationalizing plants, by improving manufacturing and production
efficiencies  and through  purchasing  economies.  Since  1991,  the Company has
reduced  costs by closing  twelve  smaller,  higher cost  facilities.  Since its
inception in 1987,  the Company has  invested  approximately  $272.3  million to
upgrade acquired manufacturing facilities, aimed at generating manufacturing and
production efficiencies and achieving a low cost producer position. As a result,
the Company's  acquisitions  have  generally been accretive to earnings and have
produced high returns on assets. The AN Can acquisition  illustrates the ability
of the Company to enhance the profitability of acquired businesses.  The Company
estimates that it has reduced AN Can's  operating costs from its historical 1994
level by at  least  $21.0  million,  through  selling  and  administrative  cost
reductions,  improved  manufacturing and production  efficiencies and purchasing
economies.  The Company  expects to further reduce AN Can's operating costs over
the next few years by an aggregate of approximately $15.0 million (approximately
half of which is expected to be realized  in 1997)  through the  elimination  of
transitional  administrative costs, the realization of additional  manufacturing
and  production   synergies  with  its  metal   container   business  and  plant
rationalizations.

  Financial Strategy

         The  Company's  financial  strategy has been to use leverage to support
its  growth  and  optimize   shareholder   returns.  The  Company's  stable  and
predictable cash flow,  generated largely as a result of its long-term  customer
relationships, has supported its financial strategy. Management has successfully
operated its  businesses  and achieved its growth  strategy  while  managing the
Company's  indebtedness.  Management  intends to apply this  strategy to further
expand its business.  Additionally,  on February 20, 1997,  Silgan Holdings Inc.
("Holdings"), the parent company of Silgan, completed an initial public offering
(the  "Offering") of 5,175,000  shares of common stock, par value $.01 per share
(the  "Holdings  Common  Stock"),  providing  Holdings with  improved  financial
flexibility to implement the Company's growth strategy.

  Business Segments

         Silgan is a holding  company that  conducts  its  business  through two
wholly owned operating companies,  Silgan Containers Corporation  ("Containers")
and Silgan Plastics Corporation ("Plastics").

         Containers. For 1996, Containers had net sales of $1,189.3 million (85%
of the Company's net sales) and income from operations of $106.8 million (85% of
the  Company's  income from  operations)  (without  giving  effect to  corporate
expense). Containers has realized compound annual unit sales growth in excess of
24% since 1992,  despite the relative  maturity of the U.S.  food can  industry.
Containers  is  engaged  in the  manufacture  and  sale of  steel  and  aluminum
containers that are used primarily by processors and packagers for human and pet
food. Containers manufactures metal containers for vegetables,  fruit, pet food,
meat,  tomato based products,  coffee,  soup,  seafood and evaporated  milk. The
Company estimates that approximately 80% of Containers'  projected sales in 1997
will be pursuant to long-term  supply  arrangements.  Containers  has agreements
with Nestle  (the  "Nestle  Supply  Agreements")  pursuant  to which  Containers
supplies a majority of Nestle's metal container  requirements,  and an agreement
with Del Monte (the "DM Supply Agreement") pursuant to which Containers supplies
substantially  all of Del Monte's metal container  requirements.  In addition to
Nestle and Del Monte, Containers has multi-year supply arrangements with several
other major food processors.



                                       -3-

<PAGE>



         Containers  also  manufactures   certain  specialty   packaging  items,
including  metal caps and closures,  plastic bowls and paper  containers used by
processors in the food industry. For 1996, Containers had net sales of specialty
packaging items of $90.7 million.

         Plastics.  For 1996,  Plastics had net sales of $216.4  million (15% of
the Company's net sales) and income from operations of $18.4 million (15% of the
Company's income from operations)  (without giving effect to corporate expense).
Plastics is aggressively pursuing  opportunities in custom designed PET and HDPE
containers.  Plastics emphasizes value-added design,  fabrication and decoration
of custom containers in its business. Plastics manufactures custom designed HDPE
containers  for health and personal  care  products,  including  containers  for
shampoos,   conditioners,   hand  creams,  lotions,  cosmetics  and  toiletries,
household  chemical  products,   including  containers  for  scouring  cleaners,
cleaning  agents  and lawn and garden  chemicals  and  pharmaceutical  products,
including containers for tablets, antacids and eye cleaning solutions.  Plastics
also manufactures PET custom designed containers for mouthwash,  respiratory and
gastrointestinal  products,  liquid soap,  skin care lotions,  salad  dressings,
condiments,  instant coffee,  bottled water and liquor.  While many of Plastics'
larger  competitors that manufacture  extrusion  blow-molded  plastic containers
employ technology  oriented to large bottles and long production runs,  Plastics
has focused on mid-sized,  extrusion  blow-molded  plastic containers  requiring
special  decoration  and shorter  production  runs.  Because these  products are
characterized  by short  product life and a demand for creative  packaging,  the
containers  manufactured  for these products  generally have more  sophisticated
designs and decorations.

Manufacturing and Production

         As is the  practice  in the  industry,  most of the  Company's  can and
plastic  container  customers  provide it with quarterly or annual  estimates of
products and quantities  pursuant to which periodic  commitments are given. Such
estimates  enable the  Company to  effectively  manage  production  and  control
working capital requirements. Containers estimates that approximately 80% of its
projected  1997 sales will be pursuant to  multi-year  contracts.  Plastics  has
purchase  orders or contracts for containers with the majority of its customers.
In general,  these purchase  orders and contracts are for  containers  made from
proprietary  molds and are for a duration of 2 to 5 years.  Both  Containers and
Plastics  schedule  their  production  to meet  their  customers'  requirements.
Because the production time for the Company's  products is short, the backlog of
customer orders in relation to sales is not significant.

  Metal Container Business

         The  Company's  manufacturing  operations  include  cutting,   coating,
lithographing,  fabricating, assembling and packaging finished cans. Three basic
processes are used to produce cans. The traditional  three-piece method requires
three pieces of flat metal to form a cylindrical body with a welded side seam, a
bottom  and a top.  High  integrity  of the side seam is  assured  by the use of
sophisticated  electronic weld monitors and organic  coatings that are thermally
cured by induction and convection processes.  The other two methods of producing
cans start by forming a shallow cup that is then formed into the desired  height
using either the draw and iron process or the draw and redraw process. Using the
draw and redraw process,  the Company  manufactures steel and aluminum two-piece
cans,  the height of which does not exceed the diameter.  For cans the height of
which is greater than the diameter,  the Company  manufactures  steel  two-piece
cans by using a drawing and ironing  process.  Quality and  stackability of such
cans are comparable to that of the shallow  two-piece cans described  above. Can
bodies and ends are manufactured  from thin,  high-strength  aluminum alloys and
steels by  utilizing  proprietary  tool and die designs and  selected can making
equipment.



                                       -4-

<PAGE>



  Plastic Container Business

         The Company utilizes two basic processes to produce plastic bottles. In
the  extrusion  blow molding  process,  pellets of plastic  resin are heated and
extruded  into a tube of plastic.  A two-piece  metal mold is then closed around
the plastic tube and high pressure air is blown into it causing a bottle to form
in the mold's shape. In the injection blow molding  process,  pellets of plastic
resin are  heated  and  injected  into a mold,  forming a plastic  preform.  The
plastic  preform is then  blown  into a  bottle-shaped  metal  mold,  creating a
plastic bottle.

         The Company believes that its proprietary  equipment for the production
of HDPE  containers is  particularly  well-suited  for the use of  post-consumer
recycled  ("PCR") resins because of the relatively low capital costs required to
convert its equipment to utilize multi-layer container construction.

         The Company's  decorating  methods for its plastic products include (1)
in-mold  labeling  which  applies a paper or  plastic  film  label to the bottle
during the blowing process and (2) post-mold  decoration.  Post-mold  decoration
includes (i) silk screen  decoration which enables the applications of images in
multiple colors to the bottle,  (ii) pressure sensitive  decoration which uses a
plastic film or paper label with an  adhesive,  (iii) heat  transfer  decoration
which  uses a  plastic  coated  label  applied  by heat,  and (iv) hot  stamping
decoration  which transfers  images from a die using metallic foils. The Company
has state-of-the-art decorating  equipment,  including, management believes, one
of the largest sophisticated decorating facilities in the country.

Raw Materials

         The Company does not believe that it is materially  dependent  upon any
single  supplier  for any of its raw  materials  and,  based  upon the  existing
arrangements with suppliers, its current and anticipated requirements and market
conditions,  the  Company  believes  that it has made  adequate  provisions  for
acquiring raw materials.  Although increases in the prices of raw materials have
generally  been passed along to the Company's  customers in accordance  with the
Company's long-term supply arrangements and otherwise, any inability to do so in
the future could have a significant impact on the Company's operating margins.

  Metal Container Business

         The Company uses tin plated and chromium plated steel, aluminum, copper
wire,  organic  coatings,  lining  compound  and  inks  in the  manufacture  and
decoration of its metal can products.  The Company's  material  requirements are
supplied through  purchase orders with suppliers with whom the Company,  through
its predecessors, has long-term relationships.  If its suppliers fail to deliver
under their  arrangements,  the Company will be forced to purchase raw materials
on the open market, and no assurances can be given that it would be able to make
such purchases at comparable  prices or terms. The Company believes that it will
be able to purchase  sufficient  quantities  of steel and aluminum can sheet for
the foreseeable future.

  Plastic Container Business

         The raw materials  used by the Company for the  manufacture  of plastic
containers  are primarily  resins in pellet form such as recycled PET,  HDPE-PCR
and virgin  HDPE and PET and,  to a lesser  extent,  low  density  polyethylene,
extrudable  polyethylene   terephthalate,   polyethylene  terephthalate  glycol,
polypropylene, polyvinyl chloride and medium density polyethylene. The Company's
resin  requirements  are acquired through  multi-year  arrangements for specific
quantities of resins with several major suppliers


                                       -5-

<PAGE>



of resins.  The price the Company pays for resin raw  materials is not fixed and
is subject  to market  pricing.  The  Company  believes  that it will be able to
purchase sufficient quantities of resins for the foreseeable future.

Sales and Marketing

         The  Company's  philosophy  has  been  to  develop  long-term  customer
relationships  by acting in partnership with its customers,  providing  reliable
quality and service and utilizing its low cost  producer  position.  The Company
markets its products in most areas of North America  primarily by a direct sales
force and for its plastic  container  business,  to a lesser  extent,  through a
network  of  distributors.  Because  of the  high  cost  of  transporting  empty
containers, the Company generally sells to customers within a 300 mile radius of
its manufacturing plants. See also "--Competition".

         In 1996, 1995 and 1994,  approximately 17%, 21% and 26%,  respectively,
of the  Company's  sales were to Nestle,  and  approximately  12%,  15% and 21%,
respectively,  of the  Company's  sales  were to Del  Monte.  No other  customer
accounted for more than 10% of the Company's total sales during such years.

  Metal Container Business

         The Company is the largest manufacturer of metal food can containers in
North America, with a unit sale market share for the twelve months ended October
31, 1996 of approximately 35% in the United States.  Containers has entered into
multi-year supply arrangements with many of its customers,  including Nestle and
Del Monte. The Company  estimates that  approximately 80% of its projected metal
container sales in 1997 will be pursuant to such arrangements.

         In 1987, the Company, through Containers,  and Nestle entered into nine
Nestle  Supply  Agreements  pursuant  to which  Containers  has agreed to supply
Nestle with,  and Nestle has agreed to purchase from  Containers,  substantially
all of the can requirements of the former  Carnation  operations of Nestle for a
period of ten years, subject to certain conditions. In 1996, sales of metal cans
by the Company to Nestle were $240.6 million.

         The Nestle  Supply  Agreements  provide for certain  prices and specify
that such prices will be increased or decreased  based upon cost change formulas
set forth therein.  The Nestle Supply Agreements contain provisions that require
Containers to maintain certain levels of product  quality,  service and delivery
in order to retain the Nestle business. In the event of a breach of a particular
Nestle Supply  Agreement,  Nestle may terminate such Nestle Supply Agreement but
the other Nestle Supply Agreements would remain in effect.

         The Company has  recently  agreed with  Nestle,  subject to  definitive
documentation,  to extend the term of certain  of the Nestle  Supply  Agreements
through 2004  (representing  approximately  10% of the Company's  estimated 1996
sales) in return for  certain  price  concessions  by the  Company.  The Company
believes that these price concessions will not have a material adverse effect on
its  results  of  operations.  Under  certain  limited  circumstances,   Nestle,
beginning in January 2000 (with respect to all of the containers  supplied under
the Nestle Supply  Agreements that have been extended through 2004), may receive
competitive  bids,  and  Containers  has the  right to match any such  bids.  If
Containers matches a competitive bid, it may result in reduced sales prices with
respect to the metal containers that are the subject of such competitive bid. In
the event that  Containers  chooses not to match a  competitive  bid, such metal
containers may be purchased from the  competitive  bidder at the competitive bid
price for the term of the bid.


                                       -6-

<PAGE>



         Under the Company's recent  agreement with Nestle,  with respect to the
remaining  Nestle  Supply  Agreements  that expire in August 1997  (representing
approximately  6% of the Company's  estimated  1996 sales),  the Company has the
right to submit a bid to Nestle,  and to match any bid  received by Nestle,  for
the 1998 supply year with respect to the metal  containers  that are the subject
of such Nestle Supply Agreements. There can be no assurance that any such bid by
the Company will be made at sales prices equivalent to those currently in effect
or otherwise on terms  similar to those  currently in effect.  In addition,  the
Company  cannot  predict the effect,  if any,  on its results of  operations  of
matching or not matching any such bids.

         On December  21,  1993,  Containers  and Del Monte  entered into the DM
Supply  Agreement.  Under the DM  Supply  Agreement,  Del  Monte  has  agreed to
purchase  from  Containers,  and  Containers  has  agreed to sell to Del  Monte,
substantially all of Del Monte's annual  requirements for metal containers to be
used for the  packaging of food and beverages in the United  States,  subject to
certain limited exceptions. In 1996, sales of metal containers by the Company to
Del Monte were $168.0 million.

         The DM Supply  Agreement  provides  for  certain  prices  for all metal
containers  supplied by Containers to Del Monte  thereunder  and specifies  that
such prices will be  increased  or decreased  based upon  specified  cost change
formulas.

         Under the DM Supply  Agreement,  beginning in December  1998, Del Monte
may, under certain  circumstances,  receive  proposals with terms more favorable
than  those  under the DM  Supply  Agreement  from  independent  commercial  can
manufacturers  for the supply of containers of a type and quality similar to the
metal containers that Containers  furnishes to Del Monte,  which proposals shall
be for the remainder of the term of the DM Supply  Agreement and for 100% of the
annual volume of containers at one or more of Del Monte's canneries.  Containers
has the right to retain the business subject to the terms and conditions of such
competitive proposal.

         The sale of metal  containers  to  vegetable  and fruit  processors  is
seasonal  and  monthly  revenues  increase  during  the  months of June  through
October.  As is  common  in the  packaging  industry,  the  Company  must  build
inventory and then carry accounts  receivable for some seasonal customers beyond
the  end of the  season.  The  acquisition  of AN Can  increased  the  Company's
seasonal metal  container  business.  Consistent  with industry  practice,  such
customers may return  unused  containers.  Historically,  such returns have been
minimal.

  Plastic Container Business

         The Company is one of the leading manufacturers of custom designed HDPE
and PET  containers  sold in North  America.  The  Company  markets  its plastic
containers  in most  areas of North  America  through a direct  sales  force and
through a large network of distributors. Management believes that the Company is
a leading  manufacturer of plastic containers in North America for personal care
products.  More than 70% of the Company's plastic containers are sold for health
and personal care products,  such as hair care,  oral care,  pharmaceutical  and
other health care applications. The Company's largest customers in these product
segments  include  the Helene  Curtis and  Chesebrough-Ponds  USA  divisions  of
Unilever United States, Inc., Procter & Gamble Co., Avon Products,  Inc., Andrew
Jergens Inc., The Dial Corporation,  Warner-Lambert  Company and Pfizer Inc. The
Company also  manufactures  plastic  containers for food and beverage  products,
such as salad  dressings,  condiments,  instant  coffee  and  bottled  water and
liquor.  Customers in these product segments include Procter & Gamble Co., Kraft
Foods Inc. and General Mills, Inc.



                                       -7-

<PAGE>



         As part of its marketing strategy, the Company has arrangements to sell
some of its plastic products to  distributors,  which in turn sell such products
primarily to regional  customers.  Plastic  containers sold to distributors  are
manufactured  by using  generic molds with  decoration,  color and neck finishes
added to meet  the  distributors'  individual  requirements.  The  distributors'
warehouses and their sales personnel  enable the Company to market and inventory
a wide range of such products to a variety of customers.

         Plastics has written  purchase  orders or contracts for containers with
the majority of its customers.  In general,  these purchase orders and contracts
are for containers made from proprietary  molds and are for a duration of 2 to 5
years.

Competition

         The packaging industry is highly  competitive.  The Company competes in
this  industry  with other  packaging  manufacturers  as well as  fillers,  food
processors and packers who manufacture containers for their own use and for sale
to others.  The Company attempts to compete  effectively  through the quality of
its products,  competitive pricing and its ability to meet customer requirements
for delivery,  performance  and technical  assistance.  The Company also pursues
market  niches such as the  manufacture  of easy-open  ends and special  feature
cans,  which may  differentiate  the Company's  products  from its  competitors'
products.

         Because of the high cost of transporting empty containers,  the Company
generally  sells to  customers  within a 300 mile  radius  of its  manufacturing
plants. Strategically located existing plants give the Company an advantage over
competitors from other areas, and the Company would be disadvantaged by the loss
or relocation of a major customer. As of December 31, 1996, the Company operated
48  manufacturing  facilities,  geographically  dispersed  throughout the United
States and Canada, that serve the distribution needs of its customers.

  Metal Container Business

         Of the commercial metal can manufacturers, Crown Cork and Seal Company,
Inc.  and  Ball  Corporation  are  the  Company's  most   significant   national
competitors.   As  an  alternative  to  purchasing   cans  from  commercial  can
manufacturers,   customers   have  the  ability  to  invest  in   equipment   to
self-manufacture  their  cans.  However,  some  self-manufacturers  have sold or
closed can manufacturing operations and entered into long-term supply agreements
with the new owners or with commercial can manufacturers.

         Although  metal  containers  face continued  competition  from plastic,
paper and composite  containers,  management  believes that metal containers are
superior to plastic and paper containers in applications  where the contents are
processed  at high  temperatures,  where the  contents  are packaged in large or
institutional  quantities  (14 to 64  oz.) or  where  long-term  storage  of the
product is desirable. Such applications include canned vegetables, fruits, meats
and pet foods.  These  sectors  are the  principal  areas for which the  Company
manufactures its products.

  Plastic Container Business

         Plastics competes with a number of large national  producers of health,
personal care, food,  beverage,  pharmaceutical  and household  chemical plastic
container products,  including  Owens-Brockway  Plastics Products, a division of
Owens-Illinois, Inc., Constar Plastics Inc., a subsidiary of Crown Cork and Seal
Company,  Inc., Johnson Controls Inc.,  Continental  Plastics Inc. and Plastipak
Packaging Inc. In order to compete effectively in the constantly changing market
for plastic bottles, the Company must


                                       -8-

<PAGE>



remain  current  with,  and to some  extent  anticipate  innovations  in,  resin
composition and applications and changes in the technology for the manufacturing
of plastic bottles.

Employees

         As of December  31,  1996,  the Company  employed  approximately  1,080
salaried and 4,445 hourly employees on a full-time basis.  Approximately  64% of
the Company's hourly plant employees are represented by a variety of unions.

         The Company's labor contracts  expire at various times between 1997 and
2008.  Contracts  covering  approximately  13% of the Company's hourly employees
presently expire during 1997. The Company expects no significant  changes in its
relations with these unions.  Management believes that its relationship with its
employees is good.

Regulation

         The Company is subject to federal,  state and local  environmental laws
and regulations.  In general,  these laws and regulations limit the discharge of
pollutants  into the air and water and establish  standards  for the  treatment,
storage,  and disposal of solid and hazardous  waste.  The Company believes that
all of its facilities are either in compliance in all material respects with all
presently  applicable  environmental  laws and  regulations  or are operating in
accordance with  appropriate  variances,  delayed  compliance  orders or similar
arrangements.

         In addition to costs associated with regulatory compliance, the Company
may be held liable for alleged  environmental  damage  associated  with the past
disposal of hazardous substances. Generators of hazardous substances disposed of
at sites at which  environmental  problems are alleged to exist,  as well as the
owners of those  sites and  certain  other  classes of  persons,  are subject to
claims  under  the  Comprehensive  Environmental  Response,   Compensation,  and
Liability  Act of 1980  ("CERCLA")  regardless  of fault or the  legality of the
original disposal.  Liability under CERCLA and under many similar state statutes
is joint and several,  and, therefore,  any responsible party may be held liable
for the entire  cleanup  cost at a  particular  site.  Other state  statutes may
impose  proportionate  rather  than joint and  several  liability.  The  federal
Environmental  Protection  Agency  or a  state  agency  may  also  issue  orders
requiring  responsible  parties  to  undertake  removal or  remedial  actions at
certain sites.  Pursuant to the agreement relating to the acquisition in 1987 of
the can operations of Nestle ("Nestle Can"),  the Company has assumed  liability
for the past waste  disposal  practices  of Nestle  Can.  In 1989,  the  Company
received  notice  that it is one of many  potentially  responsible  parties  (or
similarly  designated parties) for cleanup of hazardous waste at a site to which
it (or its predecessor  Nestle Can) is alleged to have shipped such waste and at
which the  Company's  share of  cleanup  costs  exceeded  $100,000.  See  "Legal
Proceedings".

         Pursuant  to the  agreement  relating to the  acquisition  in 1987 from
Monsanto Company  ("Monsanto") of substantially  all of the business and related
fixed assets and inventory of Monsanto's plastic containers  business ("Monsanto
Plastic  Containers"),   Monsanto  has  agreed  to  indemnify  the  Company  for
substantially all of the costs attributable to the past waste disposal practices
of Monsanto  Plastic  Containers.  In connection with the acquisition of AN Can,
subject to certain  limitations,  ANC has agreed to indemnify  the Company for a
period of three years for the costs  attributable to any noncompliance by AN Can
with any environmental law prior to the closing, including costs attributable to
the past waste disposal practices of AN Can.

         The  Company is subject to the  Occupational  Safety and Health Act and
other laws regulating noise exposure levels and other safety and health concerns
in the production areas of its plants.


                                       -9-

<PAGE>



         Management  does not believe  that any of the matters  described  above
individually  or in the aggregate  will have a material  effect on the Company's
capital expenditures, earnings, financial position or competitive position.

Research and Product Development

  Metal Container Business

         The Company's  research,  product  development and product  engineering
efforts relating to its metal containers are currently conducted at its research
centers at Oconomowoc,  Wisconsin and Neenah, Wisconsin. The Company is building
a  state-of-the-art  research  facility  in  Oconomowoc,  Wisconsin  in order to
consolidate its two main research centers into one facility.

  Plastic Container Business

         The Company's  research,  product  development and product  engineering
efforts with respect to its plastic  containers  are currently  performed by its
manufacturing  and  engineering  personnel  located  at  its  Norcross,  Georgia
facility.  In addition to its own research and  development  staff,  the Company
participates in arrangements with three non-U.S. plastic container manufacturers
that allow for an exchange of technology among these manufacturers.  Pursuant to
these  arrangements,  the Company  licenses its blow molding  technology to such
manufacturers.

Company History

         Silgan is a  Delaware  corporation  formed in August  1987 as a holding
company to acquire interests in various packaging manufacturers.  Prior to 1987,
Silgan did not engage in any business.  In June 1989,  through  certain  mergers
(the "1989  Mergers"),  Silgan became a wholly owned  subsidiary of Holdings,  a
Delaware  corporation  whose principal  asset is all of the  outstanding  common
stock of Silgan.

         Since its  inception in 1987,  the Company has  completed the following
acquisitions:

              Acquired Business                    Year        Products
------------------------------------------------   ----        --------
Metal Container Manufacturing division of Nestle   1987   Metal food containers
Monsanto Company's plastic container business      1987   Plastic containers
Fort Madison Can Company of The Dial Corporation   1988   Metal food containers
Seaboard Carton Division of Nestle                 1988   Paper containers
Aim Packaging, Inc.                                1989   Plastic containers
Fortune Plastics Inc.                              1989   Plastic containers
Express Plastic Containers Limited                 1989   Plastic containers
Amoco Container Company                            1989   Plastic containers
Del Monte's U.S. can manufacturing operations      1993   Metal food containers
Food Metal and Specialty business of ANC           1995   Metal food containers,
                                                          metal caps and
                                                          closures and Omni
                                                          plastic containers
Finger Lakes, a subsidiary of Curtice Burns        1996   Metal food containers



                                      -10-

<PAGE>



Recent Developments

  Initial Public Offering

         On February 20, 1997, Holdings completed the Offering. In the Offering,
Holdings  sold to the  underwriters  3,700,000  previously  unissued  shares  of
Holdings  Common Stock at an initial  public  offering price of $20.00 per share
for  aggregate  net proceeds to Holdings of  $68,820,000  (after  deducting  the
underwriting  discount but before  deducting  estimated  expenses of  $1,000,000
payable by Holdings in connection with the Offering). Holdings used a portion of
the net  proceeds  received by it from the Offering to make an advance to Silgan
that Silgan used to prepay on February 20, 1997  approximately  $5.4 million and
$3.5 million  principal  amount of A term loans and B term loans,  respectively,
under the Credit Agreement (as defined herein).  Holdings used the remaining net
proceeds received by it from the Offering to redeem on March 26, 1997 all of its
remaining outstanding 13-1/4% Senior Discount Debentures due 2002 (the "Discount
Debentures") (approximately $59.0 million aggregate principal amount).

         At the advice of the managing underwriters for the Offering, the number
of shares of Holdings  Common  Stock sold in the  Offering  was  increased  from
3,700,000 shares (the number of shares originally contemplated to be sold in the
Offering) to 5,175,000 shares (including the underwriters  over-allotment).  The
managing  underwriters for the Offering also advised that the additional  shares
of Holdings  Common  Stock to be included in the  Offering be sold by The Morgan
Stanley  Leveraged  Equity Fund II, L.P. ("MSLEF II") and Bankers Trust New York
Corporation  ("BTNY"),  existing stockholders of Holdings prior to the Offering.
Accordingly,  in the  Offering,  MSLEF  II and  BTNY  sold  to the  underwriters
1,317,246  and  157,754  previously  issued and  outstanding  shares of Holdings
Common Stock owned by them, respectively (including 602,807 and 72,193 shares of
Holdings  Common  Stock,  respectively,  which  were  sold  as a  result  of the
underwriters  exercise of their over-allotment option in full), or approximately
18% of the shares of Holdings  Common Stock owned by each of them.  Holdings did
not receive any of the proceeds  from the sale of the shares of Holdings  Common
Stock by MSLEF II or BTNY.

         Neither  of  Holdings'  two other  existing  stockholders  prior to the
Offering,  Messrs.  R. Philip  Silver,  the  Chairman of the Board and  Co-Chief
Executive  Officer of Holdings and Silgan,  and D. Greg Horrigan,  the President
and  Co-Chief  Executive  Officer of  Holdings  and  Silgan,  sold any shares of
Holdings  Common Stock in the  Offering.  See  "Securities  Ownership of Certain
Beneficial Owners and Management".

  Acquisition

         On October 9, 1996, Containers acquired substantially all of the assets
of Finger Lakes, a metal food container  manufacturer  with facilities in Lyons,
New York and Benton  Harbor,  Michigan and a wholly owned  subsidiary of Curtice
Burns,  for a purchase  price of  approximately  $29.9  million  (including  net
working  capital of  approximately  $8.0 million).  As part of the  transaction,
Containers entered into a ten year supply agreement with Curtice Burns to supply
all of the metal food container requirements of Curtice Burns' Comstock Michigan
Fruit and  Brooks  Foods  divisions.  For its fiscal  year ended June 29,  1996,
Finger  Lakes  had net  sales  of  $48.8  million.  The  Company  financed  this
acquisition through working capital borrowings under the Credit Agreement.



                                      -11-

<PAGE>



Item 2.  Properties

         Silgan's and  Holdings'  principal  executive  offices are located at 4
Landmark Square,  Stamford,  Connecticut 06901. The administrative  headquarters
and  principal  places of business  for  Containers  and Plastics are located at
21800 Oxnard Street,  Woodland Hills, California 91367 and 14515 N. Outer Forty,
Chesterfield,  Missouri 63017, respectively.  All of these offices are leased by
Holdings or the Company.

         The Company owns and leases  properties for use in the ordinary  course
of  business.   Such  properties   consist   primarily  of  33  metal  container
manufacturing  facilities,  11 plastic container manufacturing  facilities and 4
specialty  packaging  manufacturing  facilities.  Twenty of these facilities are
owned and 28 are  leased by the  Company.  The leases  expire at  various  times
through 2020. Some of these leases provide renewal options.

         Below  is a  list  of the  Company's  operating  facilities,  including
attached warehouses, as of February 28, 1997 for its metal container business:

                                                   Approximate Building Area
Location                                                 (square feet)
--------                                           -------------------------
City of Industry, CA..............................       50,000 (leased)
Kingsburg, CA.....................................       37,783 (leased)
Modesto, CA.......................................       35,585 (leased)
Modesto, CA.......................................      128,000 (leased)
Modesto, CA.......................................      150,000 (leased)
Riverbank, CA.....................................      167,000
San Leandro, CA...................................      200,000 (leased)
Stockton, CA......................................      243,500
Norwalk, CT.......................................       14,359 (leased)
Broadview, IL.....................................       85,000
Hoopeston, IL.....................................      323,000
Rochelle, IL......................................      175,000
Waukegan, IL......................................       40,000 (leased)
Woodstock, IL.....................................      160,000 (leased)
Evansville, IN....................................      188,000
Hammond, IN.......................................      160,000 (leased)
Laporte, IN.......................................      144,000 (leased)
Fort Madison, IA..................................       66,000
Ft. Dodge, IA.....................................       49,500 (leased)
Benton Harbor, MI.................................       20,246 (leased)
Savage, MN........................................      160,000
St. Paul, MN......................................      470,000
West Point, MS....................................       25,000 (leased)
Mt. Vernon, MO....................................      100,000
Northtown, MO.....................................      112,000 (leased)
St. Joseph, MO....................................      173,725
St. Louis, MO.....................................      174,000 (leased)
Edison, NJ........................................      280,000
Lyons, NY.........................................      145,000
Crystal City, TX..................................       26,045 (leased)
Toppenish, WA.....................................       98,000
Vancouver, WA.....................................      127,000 (leased)
Menomonee Falls, WI...............................      116,000
Menomonie, WI.....................................       60,000 (leased)
Oconomowoc, WI....................................      105,200
Plover, WI........................................       58,000 (leased)
Waupun, WI........................................      212,000



                                      -12-

<PAGE>



         Below  is a  list  of the  Company's  operating  facilities,  including
attached warehouses, as of February 28, 1997 for its plastic container business:

                                                   Approximate Building Area
Location                                                 (square feet)
--------                                           -------------------------
Anaheim, CA......................................       127,000 (leased)
Deep River, CT...................................       140,000
Monroe, GA.......................................       117,000
Norcross, GA.....................................        59,000 (leased)
Ligonier, IN.....................................       477,000 (284,000 leased)
Seymour, IN......................................       406,000
Franklin, KY.....................................       122,000 (leased)
Port Clinton, OH.................................       336,000 (leased)
Langhorne, PA....................................       156,000 (leased)
Mississauga, Ontario.............................        80,000 (leased)
Mississauga, Ontario.............................        60,000 (leased)


         The Company owns and leases certain other warehouse facilities that are
detached from its manufacturing facilities.  All of the Company's facilities are
subject to liens in favor of the banks party to the Credit Agreement.

         The Company  believes that its plants,  warehouses and other facilities
are in good operating condition, adequately maintained, and suitable to meet its
present needs and future  plans.  The Company  believes  that it has  sufficient
capacity to satisfy the demand for its products in the  foreseeable  future.  To
the extent that the Company needs additional capacity,  management believes that
the Company can convert certain  facilities to continuous  operation or make the
appropriate capital expenditures to increase capacity.


Item 3.  Legal Proceedings

         On  October  17,  1989,  the  State of  California,  on  behalf  of the
California  Department of Health  Services  ("DHS"),  filed a suit in the United
States District Court for the Northern District of California against the owners
and operators of a recycling facility operated by Summer del Caribe,  Inc., Dale
Summer and Lynn Rodich. The complaint also named 16 can manufacturing companies,
including Containers,  that had sent amounts of solder dross to the facility for
recycling  as  "Potentially  Responsible  Parties"  ("PRPs")  under the  Federal
Superfund  statute.  Containers is one of the 15 defendant  can companies  which
agreed to  participate as a group in response to the DHS suit (the "PRP Group").
In the PRP  Group  agreement,  Containers  agreed  with the  other  can  company
defendants  that its  apportioned  share of cleanup  costs would be 6.72% of the
total cost of cleanup.  The PRP Group has undertaken a feasibility study for the
purpose of developing,  designing and  implementing a final remedy for the site.
The  feasibility  study  was  approved  by the  California  Department  of Toxic
Substances  Control ("DTSC") in June 1994. On March 14, 1995, the court approved
a settlement  agreement and consent decree which ordered the PRP Group to submit
a draft  Remedial  Action  Plan to the DTSC for  approval,  which  the PRP Group
submitted  to the DTSC on September 5, 1995.  On  September  13, 1995,  the DTSC
notified the PRP Group by letter that the Remedial  Action Plan had been adopted
for the Summer del Caribe  site.  According to the  Remedial  Action  Plan,  the
overall cost of site cleanup is estimated to be $3,000,000. Site cleanup is near
completion.  However,  monitoring at the site will be required for approximately
one year, the expenses for which  represent a small portion of the total expense
of cleanup. The PRP Group


                                      -13-

<PAGE>



has assessed  approximately  $201,264 as Containers'  share of the cleanup cost,
which amount has been paid.  The Company  believes that  significant  additional
expenditures on its behalf are unlikely.

         Other  than the action  mentioned  above,  there are no other  material
pending legal proceedings to which the Company is a party or to which any of its
properties are subject.


Item 4.  Submission of Matters to a Vote of Security Holders.

         None.



                                      -14-

<PAGE>



                                     PART II

Item 5.  Market for Registrant's Common Equity and Related Stockholder Matters.

         Silgan's common stock is not publicly traded on any market or exchange.
All of the  outstanding  common stock of Silgan is held by Holdings.  Other than
(i)  distributions to Holdings in 1996 and 1995 in an aggregate amount of $205.1
million  (which  were used by Holdings to  purchase  and redeem  $204.1  million
aggregate  principal  amount of Discount  Debentures and pay accrued interest on
the Discount  Debentures) and (ii)  distributions to Holdings of $3.8 million in
1995 to enable  Holdings to make  payments to former  shareholders  of Silgan in
connection  with the 1989  Mergers,  Silgan  has not paid any  dividends  on its
common  stock or made any  distributions  to Holdings  during  Silgan's two most
recently completed fiscal years. Silgan also made a distribution of $2.2 million
to Holdings on March 26, 1997 to enable Holdings to pay accrued  interest on the
Discount Debentures redeemed on such date.

         Under  certain  limited  circumstances,  Silgan is permitted  under the
Credit Agreement and the indenture (the "11-3/4% Notes  Indenture")  relating to
Silgan's 11-3/4% Senior Subordinated Notes due 2002 (the "11-3/4% Notes") to pay
dividends on its common stock and to make  distributions  to Holdings.  However,
Silgan  does not intend to pay any  dividends  on its  common  stock or make any
distributions to Holdings in the foreseeable  future,  except for  distributions
made to Holdings to enable  Holdings to pay its  consolidated  federal and state
tax  obligations.  Additionally,  under certain  circumstances,  Silgan may make
advances or loans to Holdings as permitted  under the Credit  Agreement  and the
11-3/4% Notes Indenture.


Item 6.  Selected Financial Data.

         Set forth below are selected historical  consolidated financial data of
Silgan at December 31, 1996,  1995,  1994,  1993 and 1992 and for the years then
ended.

         The selected  historical  consolidated  financial  data at December 31,
1996 and 1995 and for each of the three years in the period  ended  December 31,
1996 (with the  exception of employee  data) were  derived  from the  historical
consolidated  financial  statements of Silgan for such periods that were audited
by Ernst & Young LLP,  independent  auditors,  whose report appears elsewhere in
this Annual Report on Form 10-K. The selected historical  consolidated financial
data at December  31, 1994,  1993 and 1992 and for the years ended  December 31,
1993 and 1992 were derived from the historical  audited  consolidated  financial
statements for such periods.

         The selected  historical  data were derived from, and should be read in
conjunction with,  "Management's  Discussion and Analysis of Financial Condition
and Results of Operations" and the historical  financial  statements,  including
the notes thereto, included elsewhere in this Annual Report on Form 10-K.



                                      -15-

<PAGE>



<TABLE>
<CAPTION>
                                             SELECTED FINANCIAL DATA

                                                                      Year Ended December 31,
                                                                      -----------------------
                                                   1996(a)       1995(a)       1994(b)      1993(b)       1992
                                                   -------       -------       -------      -------       ----
                                                                      (Dollars in thousands)
<S>                                                <C>           <C>           <C>          <C>          <C>
Operating Data:
Net sales.......................................   $1,405,742    $1,101,905    $861,374     $645,468     $630,039
Cost of goods sold..............................    1,222,976       970,491     748,290      571,174      554,972
                                                    ---------     ---------     -------      -------      -------
Gross profit....................................      182,766       131,414     113,084       74,294       75,067
Selling, general and administrative
    expenses....................................       58,056        45,734      37,160       31,821       32,274
Reduction in carrying value of assets (c).......         --          14,745      16,729         --           --
                                                    ---------     ---------     -------      -------      -------
Income from operations..........................      124,710        70,935      59,195       42,473       42,793
Interest expense and other related
    financing costs.............................       71,491        52,462      36,142       27,928       26,916
                                                    ---------     ---------     -------      -------      -------
Income before income taxes......................       53,219        18,473      23,053       14,545       15,877
Income tax provision............................       20,900         8,700      11,000        6,300        2,200
                                                    ---------     ---------     -------      -------      -------
Income before extraordinary charges and
    cumulative effect of changes in accounting
    principles..................................       32,319         9,773      12,053        8,245       13,677
Extraordinary charges relating to early
    extinguishment of debt......................         --          (2,967)       --           (841)      (9,075)
Cumulative effect of changes in accounting
    principles, net of taxes (d)................         --            --          --         (9,951)        --
                                                    ---------     ---------     -------      -------      -------
Net income (loss)...............................       32,319         6,806      12,053       (2,547)       4,602
Preferred stock dividend requirements...........         --            --          --           --          2,745
                                                    ---------     ---------     -------      -------      -------
Net income (loss) applicable to
    common stockholder..........................   $   32,319    $    6,806    $ 12,053     $ (2,547)    $  1,857
                                                    =========     =========     =======      =======      =======

Selected Segment Data:
Net sales:
    Metal container business....................   $1,189,370    $  882,345    $657,065     $459,149     $437,443
    Plastic container business..................      216,372       219,560     204,309      186,319      192,596
Income (loss) from operations: (e)
    Metal container business....................      106,861        58,111      59,770       42,267       40,722
    Plastic container business..................       18,362        13,240         (32)         575        2,336

Other Data:
Adjusted EBDITA (f).............................   $  186,753    $  133,141    $115,326     $ 76,769     $ 74,547
Adjusted EBDITA as a percentage of
    net sales...................................        13.3%         12.1%       13.4%        11.9%        11.8%
Income from operations as a percentage
    of net sales................................         8.9           6.4         6.9          6.6          6.8
Capital expenditures............................   $   56,851    $   51,897    $ 29,184     $ 42,480     $ 23,447
Depreciation and amortization (g)...............       58,631        45,388      37,187       33,818       31,754
Cash flows provided by operating activities.....      130,066       209,636      47,335       48,331       34,360
Cash flows used for investing activities........      (98,337)     (397,118)    (27,900)    (116,083)     (23,018)
Cash flows (used for) provided by financing
    activities..................................      (32,874)      186,909     (16,975)      65,285       (9,074)
Number of employees (at end of period) (h)......        5,525         5,110       4,000        3,330        3,340

Balance Sheet Data (at end of period):
Total assets....................................   $  900,369    $  888,723    $500,148     $492,064     $382,154
Total long-term debt............................      634,843       549,610     282,568      305,000      206,681
Common stockholder's equity (deficit)...........      (84,759)       12,860      63,345       52,803       32,775


                                                                                               (footnotes follow)
</TABLE>


                                      -16-

<PAGE>



                        Notes to Selected Financial Data

(a)  On August 1, 1995,  the  Company  acquired  AN Can for a purchase  price of
     $362.0  million  (including the purchase from ANC of its St. Louis facility
     in May 1996 for $13.1  million).  The  acquisition  was  accounted for as a
     purchase  transaction and the results of operations have been included with
     the Company's  historical  results from the acquisition date. See Note 3 to
     the Consolidated  Financial Statements for the year ended December 31, 1996
     included elsewhere in this Annual Report on Form 10-K.

(b)  On December 21, 1993,  the Company  acquired DM Can for a purchase price of
     approximately  $73.3  million.  The  acquisition  was  accounted  for  as a
     purchase  transaction and the results of operations have been included with
     the Company's historical results from the acquisition date.

(c)  Based upon a review of its depreciable  assets, the Company determined that
     certain  adjustments  were  necessary  to properly  reflect net  realizable
     values.  In 1995,  the metal  container  business  recorded a write-down of
     $14.7 million for the excess of carrying  value over  estimated  realizable
     value of machinery  and equipment at existing  facilities  which had become
     underutilized due to excess capacity.  In 1994, charges of $7.2 million and
     $9.5  million  were  recorded by the metal  container  business and plastic
     container business,  respectively,  to write-down the excess carrying value
     over estimated  realizable  value of various plant facilities held for sale
     and for technologically obsolete and inoperable machinery and equipment.

(d)  During  1993,  the  Company  adopted  Statement  of  Financial   Accounting
     Standards  ("SFAS")  No.  106,  "Employers  Accounting  for  Postretirement
     Benefits Other than Pensions," SFAS No. 109,  "Accounting for Income Taxes"
     and SFAS No. 112, "Employers Accounting for Postemployment  Benefits".  The
     Company did not elect to restate prior years' financial  statements for any
     of these pronouncements.

(e)  Income (loss) from operations in the selected segment data includes charges
     incurred  for the  reduction  in carrying  value of certain  assets for the
     metal  containers  business of $14.7 million and $7.2 million for the years
     ended December 31, 1995 and 1994 and for the plastic containers business of
     $9.5  million  for the year ended  December  31,  1994,  as  referred to in
     footnote (c) above. Income from operations for both the metal container and
     plastic container businesses excludes corporate expense.

(f)  "Adjusted  EBITDA"  means  consolidated  net  income  before  extraordinary
     charges,   cumulative  effect  of  changes  in  accounting  principles  and
     preferred  stock  dividends  plus,  to the extent  reflected  in the income
     statement for the  applicable  period,  without  duplication,  consolidated
     interest  expense,  income tax expense and  depreciation  and  amortization
     expense, as adjusted to add back expenses relating to postretirement health
     care costs (which amounted to $2.6 million,  $1.7 million, $0.7 million and
     $0.5 million for the years ended  December 31, 1996,  1995,  1994 and 1993,
     respectively),  the reduction in carrying value of assets (which were $14.7
     million and $16.7  million for the years ended  December 31, 1995 and 1994,
     respectively)  and certain other non-cash  charges (which included  charges
     relating  to the  vesting  of  benefits  under  Stock  Appreciation  Rights
     ("SARs") of $0.8 million, $0.4 million and $1.5 million for the years ended
     December 31, 1996, 1995 and 1994,  respectively).  The Company has included
     information regarding Adjusted EBITDA because management believes that many
     investors  consider it to be important in assessing a company's  ability to
     service and incur debt.  Accordingly,  this  information has been disclosed
     herein  to  permit a more  complete  analysis  of the  Company's  financial
     condition.  Adjusted  EBITDA  should not be considered in isolation or as a
     substitute for net income or other consolidated  statement of operations or
     cash flows data prepared in accordance with Generally  Accepted  Accounting
     Principles  ("GAAP") as a measure of the  profitability or liquidity of the
     Company.  See the  consolidated  statements of operations and  consolidated
     statements of cash flows of Silgan,  including the notes thereto,  included
     elsewhere in this Annual Report on Form 10-K. Adjusted EBITDA does not take
     into account the Company's debt service  requirements and other commitments
     and,  accordingly,  is not  necessarily  indicative  of amounts that may be
     available for  discretionary  uses.  Additionally,  Adjusted  EBITDA is not
     computed  in  accordance  with  GAAP  and may not be  comparable  to  other
     similarly titled measures of other companies.

(g)  Depreciation  and  amortization  excludes  amortization  of debt  financing
     costs.


                                      -17-

<PAGE>




(h)  The number of employees at December 31, 1995 includes  approximately  1,400
     employees  who  joined  the  Company  on  August 1, 1995 as a result of the
     acquisition  by  Containers  of AN Can. The number of employees at December
     31, 1993 excludes 650 employees who joined the Company on December 21, 1993
     as a result of the acquisition by Containers of DM Can.



                                      -18-

<PAGE>



Item 7.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations.

         The  following  should  be read in  conjunction  with the  consolidated
financial  statements of the Company and the notes thereto included elsewhere in
this Annual Report on Form 10-K. Certain information  contained in "Management's
Discussion and Analysis of Financial  Condition and Results of  Operations"  and
elsewhere in this Annual Report on Form 10-K  regarding  the Company's  expected
operations,  financial  results,  cost  savings,  future  liquidity,  plans  and
strategy for its business and related financing and general financial  condition
includes forward looking  statements made pursuant to the safe harbor provisions
of the Private  Securities  Litigation  Reform Act of 1995. Such forward looking
statements  involve  uncertainties  and risks,  including,  but not  limited to,
factors  described  in this  Annual  Report on Form 10-K and in  Silgan's  other
filings  with the  Securities  and Exchange  Commission.  The  Company's  actual
operations,  financial  results,  cost  savings,  future  liquidity,  plans  and
strategy for its business and related financing and general financial  condition
may differ from such forward looking statements.

Overview

         The Company is a leading North American  manufacturer of consumer goods
packaging products that currently produces (i) steel and aluminum containers for
human and pet food, (ii) custom designed  plastic  containers for personal care,
health, food, pharmaceutical and household chemical products and (iii) specialty
packaging  items,  including  metal caps and  closures,  plastic bowls and paper
containers  used by processors in the food industry.  The Company is the largest
manufacturer of metal food containers in North America,  with a unit sale market
share for the twelve months ended October 31, 1996 of 35% in the United  States,
and is a  leading  manufacturer  of  plastic  containers  in North  America  for
personal care products.  The Company has focused on growth through acquisitions,
followed by plant  rationalizations  and  consolidations  and  investment in the
acquired  businesses to gain  manufacturing  and production  efficiencies and to
provide for internal growth.  Since its inception,  the Company has acquired and
successfully integrated ten businesses,  including the recent acquisitions of AN
Can in  August  1995  for a  purchase  price  of  approximately  $362.0  million
(including net working  capital of  approximately  $156.0 million) and DM Can in
December 1993 for a purchase price of approximately $73.3 million (including net
working capital of approximately $21.9 million). In addition, on October 9, 1996
the Company  completed  its  acquisition  of Finger Lakes,  the metal  container
manufacturing subsidiary of Curtice Burns. See "Business--Recent  Developments".
The Company's future growth will depend in large part on additional acquisitions
of consumer goods packaging businesses.

         The Company is continually evaluating and intends to continue to pursue
acquisition opportunities in the North American consumer goods packaging market.
Although the Company has no present  binding  agreements or  commitments to make
any  acquisition,  the Company  has  expressed  indications  of interest or made
preliminary bids on three acquisition  opportunities presented to it, which have
annual sales ranging from  approximately  $30 million to $250 million.  Any such
acquisition may be financed  through the incurrence of additional  indebtedness.
The Company has  recently  received the  necessary  consents to amend the Credit
Agreement  to enable it to incur up to an  additional  $50.0  million  of B term
loans  thereunder to finance certain of such  acquisitions.  No assurance can be
given that the Company will complete any such acquisition.



                                      -19-

<PAGE>



         Silgan is a holding  company that  conducts  its  business  through two
wholly owned operating companies, Containers and Plastics.

  Cost Reductions and Investments Following Acquisitions

         The Company believes that its acquisitions and investments have enabled
it to  achieve a low cost  position  in the metal  food  container  segment.  To
further  enhance its low cost position,  the Company has realized cost reduction
opportunities through plant  rationalizations and capital improvements,  as well
as from improved  production  scheduling and line  reconfiguration.  Since 1991,
Containers has closed eight  smaller,  higher cost metal  container  facilities,
including  five  facilities  that  were  closed  in  1995  as a  result  of  the
integration  of the  manufacturing  operations  of DM Can.  Because  most of the
facilities  that were closed in 1995 were  closed late in the year,  the Company
began to realize the benefits from the closing of such  facilities in 1996. From
1991  through  1993,   Plastics  closed  three   manufacturing   facilities  and
consolidated the technical and administrative functions of its plastic container
businesses.  An additional  facility was closed in 1995. In 1994, Plastics began
to realize the benefits of this consolidation and  rationalization  program,  as
well as from its capital investment  program. In the fourth quarter of 1996, the
Company  initiated  further  downsizing and  rationalizations  of certain of its
facilities.   Management  expects  that  these  actions,   along  with  improved
production  scheduling,  will enable the Company to achieve lower  manufacturing
costs in 1997 as compared to 1996.

  AN Can Acquisition

         Management believes that the acquisition of AN Can, which has seventeen
manufacturing  facilities,  provides the Company  with  further  cost  reduction
opportunities, not only through purchasing economies and manufacturing synergies
which it will  realize  from the  combined  operations,  but  also  through  the
integration of selling, general and administrative operations of AN Can into the
Company's  existing metal  container  business.  In 1996,  the Company  realized
certain of the manufacturing synergies. In 1997, the Company expects to complete
the  integration  of the  selling,  general and  administrative  functions.  The
Company  believes that it will realize the full benefits of the  integration  of
the selling,  general and administrative functions in 1998, and that benefits to
be realized by the  rationalization  of plant  operations will begin to occur in
1997.

         Although   employee   termination   costs  in  connection   with  plant
rationalizations, administrative workforce reductions and other plant exit costs
associated  with the  acquisition of AN Can have been accrued  through  purchase
accounting  adjustments,  the  Company  incurred  in  1995  and  in  1996  other
non-recurring  costs  which  under  current  accounting  pronouncements  will be
charged  against  operating  income.  These costs,  which  include  transitional
charges related to the integration of selling and administrative  functions,  as
well as costs  associated  with  plant  rearrangement  and  clean-up,  were $3.2
million in 1995 and were approximately $3.5 million in 1996. The Company expects
that it will  eliminate  the redundant  charges  related to the  integration  of
selling and administrative functions in 1997.

  Net Sales

         Long-term  Contracts.   The  Company  seeks  to  develop  and  maintain
long-term   relationships  with  its  customers.   The  Company  estimates  that
approximately  80% of  Containers'  projected  sales in 1997 will be pursuant to
long-term supply  arrangements.  Containers' has agreements with Nestle pursuant
to  which   Containers   supplies  a  majority  of  Nestle's   metal   container
requirements,  and an  agreement  with Del Monte  pursuant  to which  Containers
supplies  substantially  all of Del Monte's U.S. metal  container  requirements.
Revenues from these two customers represented  approximately 29% of net sales by
Containers  in 1996.  In  addition  to  Nestle  and Del  Monte,  Containers  has
multi-year supply arrangements


                                      -20-

<PAGE>



with several other customers,  including contracts which AN Can had with many of
its  customers.  The  Company  has  recently  agreed  with  Nestle,  subject  to
definitive  documentation,  to extend the term of  certain of the Nestle  Supply
Agreements  through 2004  (representing  approximately 10% of the Company's 1996
sales)  in  return  for  certain   price   concessions   by  the  Company.   See
"Business--Sales   and  Marketing".   The  Company  believes  that  these  price
concessions  will  not  have  a  material  adverse  effect  on  its  results  of
operations.  Under the Company's recent  agreement with Nestle,  with respect to
the remaining Nestle Supply Agreements that expire in August 1997  (representing
approximately  6% of the  Company's  1996  sales),  the Company has the right to
submit a bid to Nestle,  and to match any bid  received by Nestle,  for the 1998
supply year with  respect to the metal  containers  that are the subject of such
Nestle  Supply  Agreements.  There can be no assurance  that any such bid by the
Company will be made at sales prices  equivalent to those currently in effect or
otherwise on terms similar to those currently in effect. The loss by the Company
of either Nestle or Del Monte as a customer would have a material adverse effect
on the Company's results of operations. See "Business--Sales and Marketing".

         The Company's  long-term supply contracts generally provide for pricing
changes in accordance with cost change formulas,  thereby significantly reducing
the exposure of the Company's  results from  operations to the volatility of raw
material  costs.  In  addition,  the  terms of the  Company's  long-term  supply
contracts limit the Company's ability to increase margins.

         Agricultural  Harvest and  Seasonality.  The Company's  metal container
business sales are  dependent,  in part,  upon the  vegetable,  tomato and fruit
harvests in the midwest and western  regions of the United States.  The size and
quality of these harvests varies from year to year, depending in large part upon
the weather conditions in those regions. The fruit and vegetable pack harvest in
1994 was better than the below normal fruit and vegetable  pack harvest in 1995,
resulting in greater sales to fruit and vegetable pack  processing  customers in
1994 as compared to 1995. The 1996 midwest  vegetable harvest was better than in
1995,  but, due to cool wet weather  during the 1996 planting  season,  was less
than the harvest in 1994.

         The Company's  business is affected by seasonal  variations as a result
of the timing of the harvest.  Accordingly,  the Company experiences higher unit
sales volume in the second and third quarters and, as a result,  the Company has
historically  generated  a  disproportionate  amount of its annual  income  from
operations during these quarters.  In 1996, the Company generated  substantially
all of its net income in the second and third quarters.

  Charges Relating to Stock Options

         Concurrent  with the Offering,  all  outstanding  stock options  issued
under the stock option plans of Containers  and Plastics were converted to stock
options under the Silgan  Holdings Inc.  Fourth  Amended and Restated 1989 Stock
Option Plan (the "Stock Option Plan"). See "Executive Compensation--Stock Option
Plan". In accordance with  Accounting  Principles  Board ("APB") No. 25, options
granted  under  such  plans  are  considered   variable  options  with  a  final
measurement  date at the time of conversion.  The Company  recognized a non-cash
charge of approximately  $22.9 million,  net of $3.3 million previously accrued,
at the time of the  Offering in the  Company's  first  quarter in 1997,  for the
excess of fair  market  value over grant  price of these  options  less  amounts
previously accrued.



                                      -21-

<PAGE>



Results of Operations

         The following  table sets forth certain  income  statement data for the
Company,  expressed  as a  percentage  of net  sales,  for  each of the  periods
presented,  and should be read in conjunction  with the  consolidated  financial
statements of the Company and related notes thereto  included  elsewhere in this
Annual Report on Form 10-K.

<TABLE>
<CAPTION>
                                                                                     Year Ended December 31,
                                                                             --------------------------------------
                                                                              1996            1995            1994
                                                                             ------          ------          ------
<S>                                                                          <C>             <C>             <C>
Operating Data:
Net sales:
  Metal container business.........................................           84.6%           80.1%           76.3%
  Plastic container business.......................................           15.4            19.9            23.7
                                                                             -----           -----           -----
    Total..........................................................          100.0           100.0           100.0
Cost of goods sold.................................................           87.0            88.1            86.9
                                                                             -----           -----           -----
Gross profit.......................................................           13.0            11.9            13.1
Selling, general and administrative expenses.......................            4.1             4.1             4.3
Reduction in carrying value of assets..............................            --              1.3             1.9
                                                                             -----           -----           -----
Income from operations.............................................            8.9             6.5             6.9
Interest expense and other related financing costs.................            5.1             4.8             4.2
                                                                             -----           -----           -----
Income before income taxes.........................................            3.8             1.7             2.7
Income tax provision...............................................            1.5             0.8             1.3
                                                                             -----           -----           -----
Income before extraordinary charges................................            2.3             0.9             1.4
Extraordinary charges relating to early extinguishment of debt.....            --             (0.3)            --
                                                                             -----           -----           -----
Net income.........................................................            2.3%            0.6%            1.4%
                                                                             =====           =====           =====
</TABLE>


         Summary  historical  results for the Company's  two business  segments,
metal and plastic  containers,  for the calendar  years ended December 31, 1996,
1995 and 1994 and summary pro forma results for these business  segments for the
calendar year ended December 31, 1995 (after giving effect to the acquisition of
AN Can as of the beginning of such period) are provided below.

         The unaudited pro forma financial data includes the historical  results
of the  Company  and AN Can and  reflects  the  effect  of  purchase  accounting
adjustments based on appraisals and valuations, the financing of the acquisition
of AN Can, the  refinancing  of certain of the Company's debt  obligations,  and
certain other  adjustments,  as if these events  occurred as of the beginning of
the periods presented.  The unaudited pro forma financial data do not purport to
represent what the Company's  financial  position or results of operations would
actually have been had these  transactions  in fact occurred at the beginning of
the periods indicated, or to project the Company's financial position or results
of operations for any future date or period.  The unaudited pro forma  financial
data do not give effect to adjustments  for decreased  costs from  manufacturing
synergies resulting from the integration of AN Can with Containers' existing can
manufacturing operations and benefits the Company may realize as a result of its
planned rationalization of plant operations. The pro forma information presented
should be read in conjunction  with the historical  results of operations of the
Company included elsewhere in this Annual Report on Form 10-K.



                                      -22-

<PAGE>



<TABLE>
<CAPTION>
                                                                              Year Ended December 31,
                                                          --------------------------------------------------------------
                                                                            Historical                       Pro Forma
                                                          -----------------------------------------------  -------------
                                                               1996            1995            1994            1995
                                                          --------------  --------------  --------------  --------------
                                                                               (Dollars in millions)
<S>                                                          <C>            <C>             <C>             <C>
Net sales:
  Metal container business..............................     $1,189.3       $  882.3        $ 657.1         $1,184.8
  Plastic container business............................        216.4          219.6          204.3            219.6
                                                              -------        -------         ------          -------
  Consolidated..........................................     $1,405.7       $1,101.9        $ 861.4         $1,404.4
                                                              =======        =======         ======          =======
Income from operations:
  Metal container business..............................     $  106.8       $   72.9        $  67.0         $   95.7
  Plastic container business............................         18.4           13.2            9.4             13.2
  Reduction in asset value<F1>..........................          --           (14.7)         (16.7)           (14.7)
  Corporate expense.....................................         (0.5)          (0.5)          (0.5)            (0.2)
                                                              -------        -------         ------          -------
        Consolidated....................................     $  124.7       $   70.9        $  59.2         $   94.0
                                                              =======        =======         ======          =======


-------------------
<FN>

<F1> Included in the  historical  and pro forma  income from  operations  of the
     Company in 1995 are charges  incurred  for the  reduction  of the  carrying
     value of certain  underutilized  equipment to net realizable value of $14.7
     million  allocable  to  the  metal  container  business.  Included  in  the
     historical  income  from  operations  of the  Company  in 1994 are  charges
     incurred for the reduction of the carrying  value of certain  underutilized
     and obsolete equipment to net realizable value of $16.7 million in 1994, of
     which $7.2 million was allocable to the metal  container  business and $9.5
     million to the plastic container business.
</FN>
</TABLE>

  Historical Year Ended December 31, 1996 Compared with Historical Year Ended
  December 31, 1995

         Net Sales.  Consolidated net sales increased $303.8 million,  or 27.6%,
to $1.4 billion for the year ended  December 31, 1996,  as compared to net sales
of  $1.1  billion  for  the  same  period  in  1995.   This  increase   resulted
predominantly from net sales generated by the former AN Can operations.

         Net sales for the metal container business  (including net sales of its
specialty  business of $90.7  million) were $1,189.3  million for the year ended
December  31,  1996,  an  increase  of $307.0  million  from net sales of $882.3
million for the same period in 1995. Net sales of metal cans of $1,098.6 million
for the year ended December 31, 1996 were $253.1 million  greater than net sales
of metal  cans of $845.5  million  for the same  period in 1995.  This  increase
resulted from the inclusion of a full year of sales generated from the former AN
Can operations,  including net sales of approximately  $236.0 million during the
first seven months of 1996, and increased  unit sales due to a better  vegetable
pack harvest in 1996 as compared to 1995,  offset to a limited  extent by volume
losses with certain customers.

         Sales of  specialty  items  included  in the  metal  container  segment
increased $53.9 million to $90.7 million during the year ended December 31, 1996
as compared to the same period in 1995, due  predominantly  to additional  sales
generated by the former AN Can operations.

         Net sales for the plastic  container  business of $216.4 million during
the year ended December 31, 1996 decreased $3.2 million from net sales of $219.6
million  for the same period in 1995.  Despite an  increase  in unit sales,  net
sales of plastic  containers  declined as a result of the pass  through of lower
resin costs.

         Cost of Goods Sold.  Cost of goods sold as a percentage of consolidated
net sales was 87.0% ($1.2  billion)  for the year ended  December  31,  1996,  a
decrease of 1.1 percentage points as compared


                                      -23-

<PAGE>



to 88.1% ($970.5  million) for the same period in 1995.  The decrease in cost of
goods  sold  as a  percentage  of net  sales  was  principally  attributable  to
synergies realized from the AN Can acquisition,  improved operating efficiencies
due  to  can  plant  consolidations  as  well  as  the  improved   manufacturing
performance by the plastic  container  business,  offset, in part, by the higher
cost base of the former AN Can operations and the realization of higher per unit
costs  due to  the  Company's  one-time  planned  reduction  in  finished  goods
inventory. The additional production capacity provided by AN Can has enabled the
Company  to produce  its  product  closer to the time of sale and,  as a result,
during 1996 the Company reduced the amount of finished goods that it carries.

         Selling,  General and  Administrative  Expenses.  Selling,  general and
administrative  expenses as a percentage of  consolidated  net sales remained at
4.1% ($58.1 million and $45.7 million) for the years ended December 31, 1996 and
1995.  The increase in selling,  general,  and  administrative  expenses in 1996
resulted  from  the  acquisition  of AN  Can.  The  Company  incurred  estimated
redundant  costs of $3.5 million  associated  with the integration of the AN Can
operations.  In 1997,  the Company  expects to eliminate all of these  redundant
costs as it completes its integration of the administrative  functions of AN Can
with the Company.

         Income from  Operations.  Income from  operations  as a  percentage  of
consolidated net sales increased 2.4 percentage  points to 8.9% ($124.7 million)
for the year ended December 31, 1996, as compared with 6.5% ($70.9  million) for
the same period in the prior year.  Included in income from  operations for 1995
was a charge of $14.7 million for the write-off of certain underutilized assets.
Without giving effect to this charge,  income from operations as a percentage of
consolidated  net sales would have  increased 1.1  percentage  points in 1996 as
compared to 1995, as a result of the aforementioned improvement in gross margin.

         Income  from  operations  as a  percentage  of net  sales for the metal
container business improved to 9.0% ($106.8 million) for the year ended December
31, 1996,  from 8.3% ($72.9  million)  (without  giving  effect to the charge of
$14.7  million to adjust the  carrying  value of  certain  assets)  for the same
period in 1995.  This increase in income from  operations as a percentage of net
sales for the metal container business was principally attributable to synergies
resulting from the acquisition of AN Can, improved operating efficiencies due to
plant  consolidations  and  the  benefit  of  cost  reductions  provided  by the
Company's capital investment  program,  offset, in part, by the higher cost base
of the AN Can  operations  and the  negative  impact of the  Company's  one-time
planned reduction in the amount of finished goods inventory.

         Income from  operations  as a  percentage  of net sales for the plastic
container  business improved to 8.5% ($18.4 million) for the year ended December
31, 1996, from 6.0% ($13.2 million) for the same period in 1995. The improvement
in the operating  performance of the plastic container  business was principally
attributable to increased  production  volumes as well as the benefits  realized
through  capital  investment  and improved  production  planning and  scheduling
efficiencies.

         Interest  Expense.  Interest  expense  increased $19.0 million to $71.5
million  for the year  ended  December  31,  1996,  principally  as a result  of
increased  borrowings to fund the redemption of a portion of Holdings'  Discount
Debentures and to finance the acquisition of AN Can in August 1995,  offset,  in
part, by lower average bank borrowing rates.

         Income  Taxes.  The  provisions  for income  taxes for the years  ended
December 31, 1996 and 1995 provide for  federal,  state and foreign  taxes as if
the  Company  were  a  separate  taxpayer  in  accordance  with  SFAS  No.  109,
"Accounting for Income Taxes".



                                      -24-

<PAGE>



         Net Income.  As a result of the items  discussed  above,  net income of
$32.3 million  increased  $22.5 million for the year ended December 31, 1996, as
compared to net income of $9.8 million  (before  extraordinary  charges,  net of
taxes, of $3.0 million) for the year ended December 31, 1995.

         In 1995, the Company incurred an extraordinary  charge of $3.0 million,
net of taxes,  for the  write-off  of  unamortized  debt  costs  related  to the
refinancing of its secured debt facilities to fund the AN Can acquisition.

  Historical Year Ended December 31, 1996 Compared with Pro Forma Year Ended
  December 31, 1995

         Net Sales.  Consolidated net sales for the year ended December 31, 1996
of $1.4 billion were comparable to pro forma consolidated net sales for the same
period  in  1995.  Increased  unit  sales of  metal  containers  due to a better
vegetable  pack harvest in 1996 as compared to 1995 offset the loss of an AN Can
customer whose product line was acquired by a company that  manufactured its own
cans and volume  losses  with  certain  other  customers.  Although  the plastic
container  business had increased  unit volume in 1996,  net sales declined $3.2
million due to the pass through of lower resin costs.

         Income from  Operations.  Income from  operations  as a  percentage  of
consolidated  net sales for the year  ended  December  31,  1996  increased  1.2
percentage points to 8.9% ($124.7 million), as compared to pro forma income from
operations as a percentage of pro forma  consolidated  net sales of 7.7% ($108.7
million)  (without  giving effect to the charge to adjust the carrying  value of
certain  assets of $14.7  million) for the year ended  December  31,  1995.  The
increase  in income  from  operations  for the year ended  December  31, 1996 as
compared  to pro forma  income from  operations  for the same period in 1995 was
attributable  to more  efficient  production  planning,  the  realization of can
manufacturing  synergies  resulting from the acquisition of AN Can, the benefits
realized from plant  consolidations  and capital  investments,  and the improved
operating  performance of the plastic  container  business,  offset, in part, by
redundant costs associated with the AN Can operations and the negative impact of
the  Company's  one-time  planned  reduction  of the  amount of  finished  goods
inventory.

  Historical Year Ended December 31, 1995 Compared with Historical Year Ended
  December 31, 1994

         Net Sales.  Consolidated net sales increased $240.5 million,  or 27.9%,
to $1.1 billion for the year ended  December 31, 1995,  as compared to net sales
of $861.4 million for the same period in 1994.  This increase  resulted from net
sales of $264.3 million generated by AN Can since its acquisition in August 1995
and a $15.3 million increase in sales of plastic  containers offset, in part, by
a decline in sales of metal  containers  to Silgan's  existing  customer base of
$39.1 million.

         Net sales for the metal  container  business  (including  its specialty
business)  were $882.3 million for the year ended December 31, 1995, an increase
of $225.2  million from net sales of $657.1 million for the same period in 1994.
Excluding  net sales of metal cans of $236.0  million  generated by AN Can since
its acquisition,  net sales of metal cans to the Company's customers were $609.5
million  during the year ended  December 31, 1995, as compared to $647.5 million
for the same  period  in 1994.  Net  sales to the  Company's  customers  in 1995
decreased  principally due to lower unit volume  resulting from the below normal
1995 vegetable pack offset,  in part, by slightly higher sales prices due to the
pass through of raw material cost increases.



                                      -25-

<PAGE>



         Sales of  specialty  items  included  in the  metal  container  segment
increased $27.2 million to $36.8 million during the year ended December 31, 1995
as compared to the same period in 1994,  due to the  acquisition of AN Can which
generated sales of $28.3 million of specialty items since its acquisition.

         Net sales for the plastic  container  business of $219.6 million during
the year ended  December  31, 1995  increased  $15.3  million  over net sales of
$204.3 million for the same period in 1994.  This increase was  attributable  to
increased  unit sales for new  customer  products  and to higher  average  sales
prices due to the pass through of higher average resin costs.

         Cost of Goods Sold.  Cost of goods sold as a percentage of consolidated
net sales was 88.1%  ($970.5  million) for the year ended  December 31, 1995, an
increase of 1.2 percentage  points as compared to 86.9% ($748.3 million) for the
same period in 1994.  The increase in cost of goods sold as a percentage  of net
sales principally resulted from increased per unit manufacturing costs resulting
from reduced can production volumes,  lower margins realized on certain products
due to competitive  market conditions and lower margins on sales made by AN Can,
offset, in part, by improved  manufacturing  operating efficiencies due to plant
consolidations and lower  depreciation  expense due to a change in the estimated
useful life of certain equipment.

         Selling,  General and  Administrative  Expenses.  Selling,  general and
administrative  expenses as a percentage of consolidated  net sales declined 0.2
percentage  points to 4.1% ($45.7  million) for the year ended December 31, 1995
as compared to 4.3% ($37.2  million) for the year ended  December 31, 1994.  The
decrease in selling,  general and administrative expenses as a percentage of net
sales resulted from the Company's continued control of these expenses in respect
of the Company's  existing  business,  offset partially by a temporarily  higher
level of expenses incurred during the integration of AN Can. The Company expects
that its selling, general and administration costs as a percentage of sales will
decline  in 1997  after  it  completes  the  integration  of the  administrative
functions of its metal container business.

         Income from  Operations.  Income from  operations  as a  percentage  of
consolidated  net sales was 6.4% ($70.9 million) for the year ended December 31,
1995,  as  compared  with  6.9%  ($59.2  million)  for the same  period in 1994.
Included in income from  operations  were  charges for the  write-off of certain
underutilized  assets  of $14.7  million  and  $16.7  million  in 1995 and 1994,
respectively.  Without giving effect to these charges, income from operations as
a  percentage  of  consolidated  net sales  would  have  declined  1.0% in 1995,
primarily as a result of the aforementioned decline in gross margin.

         Income  from  operations  as a  percentage  of net  sales for the metal
container  business  (without giving effect to charges of $14.7 million and $7.2
million in 1995 and 1994, respectively,  to adjust the carrying value of certain
assets)  was 8.3% ($72.9  million)  for the year ended  December  31,  1995,  as
compared to 10.2%  ($67.0  million)  for the same period in the prior year.  The
decrease in income from  operations  as a  percentage  of net sales  principally
resulted from higher per unit  manufacturing  costs realized on lower production
volume,  lower margins  realized on certain  products due to competitive  market
conditions,  inefficiencies  caused by work  stoppages  at two of the  Company's
California  facilities,  and lower  margins  realized  on sales  made by AN Can,
offset, in part, by operating efficiencies due to plant consolidations.

         Income from operations as a percentage of net sales attributable to the
plastic container  business (without giving effect to the charge of $9.5 million
in 1994 to adjust the carrying value of certain assets) was 6.0% ($13.2 million)
for the year ended December 31, 1995, as compared to 4.6% ($9.4 million) for the
same period in 1994. The operating performance of the plastic container business
improved as a result of  production  planning and  scheduling  efficiencies  and
benefits  realized from capital  investment,  offset, in part, by increased unit
production costs incurred as a result of an inventory reduction program.


                                      -26-

<PAGE>



         Interest  Expense.  Interest  expense  increased $16.3 million to $52.5
million  for the year  ended  December  31,  1995,  principally  as a result  of
increased  borrowings  to finance the  acquisition  of AN Can, to advance  $57.6
million to  Holdings  to fund the  redemption  by  Holdings  of a portion of the
Discount  Debentures and to fund higher working capital needs as a result of the
increased seasonality of the Company's metal container business, and as a result
of higher average interest rates.

         Income  Taxes.  The  provisions  for income  taxes for the years  ended
December 31, 1995 and 1994 provide for  federal,  state and foreign  taxes as if
Silgan was a separate taxpayer in accordance with SFAS No. 109,  "Accounting for
Income Taxes".

         Net Income. As a result of the items discussed above, income before the
extraordinary  charge for the year ended December 31, 1995 was $9.8 million,  as
compared to $12.1 million for the year ended December 31, 1994.

         As a result of the  early  extinguishment  of  amounts  owed  under its
secured debt facilities,  the Company  incurred an extraordinary  charge of $3.0
million (net of tax of $2.1 million) in 1995.

Capital Resources and Liquidity

         The  Company's   liquidity   requirements   arise  primarily  from  its
obligations under the indebtedness  incurred in connection with its acquisitions
and the refinancing of such indebtedness, capital investment in new and existing
equipment  and the funding of the  Company's  seasonal  working  capital  needs.
Historically, the Company has met these liquidity requirements through cash flow
generated from operating activities and working capital borrowings.

         In August 1995, Silgan, Containers and Plastics entered into the credit
agreement  with the lenders  named  therein,  Bankers  Trust  Company  ("Bankers
Trust"), as Administrative Agent and Co-Arranger,  and Bank of America Illinois,
as  Documentation  Agent and  Co-Arranger (as amended,  the "Credit  Agreement")
(which originally provided Silgan with $225.0 million of A term loans and $225.0
million of B term loans and provided  Containers  and Plastics with a commitment
of $225.0  million for working  capital  loans) to finance  the  acquisition  by
Containers  of AN Can and to refinance and repay in full all amounts owing under
the Company's  previous  credit  agreement  and under  Silgan's  Senior  Secured
Floating Rate Notes due 1997.  The Credit  Agreement was amended in May 1996 to,
among other things,  provide Silgan with an additional  $125.0 million of B term
loans  to  fund  the  redemption  by  Holdings  of a  portion  of  the  Discount
Debentures.  The Credit  Agreement  also  provided  the  Company  with  improved
financial  flexibility  by (i) extending  the maturity of the Company's  secured
debt facilities  until December 31, 2000, (ii) lowering the interest rate spread
on its  floating  rate  borrowings  by 1/2%,  as well as  providing  for further
interest rate  reductions  in the event the Company  attains  certain  financial
targets,  (iii) lowering  Holdings'  average cost of  indebtedness by permitting
Silgan to distribute to Holdings  $205.1 million of borrowings  under the Credit
Agreement,  which  amounts  were used to  purchase  and  redeem  $204.1  million
principal amount of Discount Debentures and pay accrued interest on the Discount
Debentures,  and (iv)  enabling  Silgan to transfer  funds to  Holdings  for the
payment by  Holdings  of cash  dividends  on its  Exchangeable  Preferred  Stock
Mandatorily  Redeemable  2006  (the  "Exchangeable  Preferred  Stock")  (or cash
interest  on  Holdings'   Subordinated   Debentures   due  2006  (the  "Exchange
Debentures")).

         During  1996,   cash  generated  from  operations  of  $130.1  million,
borrowings  of $125.0  million of B term loans under the Credit  Agreement,  net
borrowings of working capital loans under the Credit Agreement of $20.7 million,
proceeds  of $1.6  million  from the sale of  assets  and $1.1  million  of cash
balances were used to fund capital  expenditures of $56.9 million,  the purchase
of Finger Lakes for $29.9


                                      -27-

<PAGE>



million  and the  purchase  of ANC's  St.  Louis  facility  for  $13.1  million,
distributions  to Holdings of $147.5  million (which amount was used by Holdings
to  redeem  Discount  Debentures  and  pay  accrued  interest  on  the  Discount
Debentures),  the  repayment  of $29.5  million of term  loans  under the Credit
Agreement,  and the payment of $1.6 million of financing  costs  associated with
the borrowing of additional B term loans under the Credit Agreement.

         The Company's  Adjusted  EBITDA for the year ended December 31, 1996 in
comparison to 1995 increased by $53.6 million to $186.8 million. The increase in
Adjusted  EBITDA  resulted  primarily from increased cash earnings  generated by
both  the  metal  container  business   (including  earnings  from  the  AN  Can
operations) and the plastic container business.  Although the Adjusted EBITDA of
the Company  was higher in 1996 as compared to 1995 and the Company  reduced the
amount of finished goods  inventory in 1996,  cash flow from  operations in 1996
would have  remained  constant  with 1995  (assuming AN Can had been acquired at
December  31, 1995  rather  than at its  seasonal  peak).  The Company  incurred
greater cash interest expense in 1996 due to additional  borrowings used to fund
the redemption by Holdings of a portion of the Discount Debentures,  and in 1995
the Company adopted similar year-end vendor payment terms to those of AN Can.

         During  1995,   cash  generated  from   operations  of  $209.6  million
(including  cash of $112.0  million  generated  by AN Can  during the five month
period  from its  acquisition  on  August 1,  1995),  proceeds  of $3.5  million
realized from the sale of assets and a decrease of $0.6 million in cash balances
were used to repay $142.8 million of working capital borrowings used to fund the
acquisition of AN Can, fund capital  expenditures  of $51.9 million,  repay $9.7
million  of term  loans and $5.5  million of  working  capital  loans,  and make
payments  to  former   shareholders  of  $3.8  million  in  full  settlement  of
outstanding  litigation  (which  was  charged  against  equity).  The  Company's
Adjusted  EBITDA  for the year  ended  December  31,  1995 as  compared  to 1994
increased by $17.8 million to $133.1  million.  The increase in Adjusted  EBITDA
reflected  the  generation  of  additional  cash  flow  from  AN Can  since  its
acquisition  on  August 1,  1995,  partially  offset  by a  decline  in the cash
earnings of the Company's  existing  business  principally  as a result of lower
unit volume due to the below normal 1995 vegetable pack.

         For the year ended  December 31, 1995,  the operating  cash flow of the
Company  increased  significantly  from the prior year due to the  generation of
cash by AN Can since its  acquisition  on August 1, 1995 and the adoption by the
Company of similar year-end vendor payment terms to those of AN Can. At December
31,  1995,  the trade  receivable  balance  of AN Can was $44.2  million  ($90.2
million on August 1, 1995),  the  inventory  balance was $98.9  million  ($137.9
million on August 1, 1995),  and the trade  payables  balance was $58.2  million
($64.2 million on August 1, 1995).

         Because the Company sells metal  containers used in fruit and vegetable
pack processing,  its sales are seasonal.  As a result, a significant portion of
the Company's revenues are generated in the first nine months of the year. As is
common in the packaging  industry,  the Company must access  working  capital to
build inventory and then carry accounts receivable for some customers beyond the
end of the summer and fall  packing  season.  Seasonal  accounts  are  generally
settled by year end. The acquisition of AN Can increased the Company's  seasonal
metal containers  business.  The Company's average outstanding trade receivables
increased in 1996 as compared to 1995 due to the acquisition of AN Can which had
more  seasonal  sales than the Company.  As a result the Company  increased  the
amount of working  capital  loans  available to it under its credit  facility to
$225.0 million. Due to the Company's seasonal requirements,  the Company expects
to incur short term  indebtedness to finance its working  capital  requirements.
Approximately  $182.5 million of the working  capital  revolver under the Credit
Agreement,  including  letters of credit,  was utilized at its peak in September
1996.



                                      -28-

<PAGE>



         As of December 31, 1996, the  outstanding  principal  amount of working
capital loans was $27.8 million and,  subject to a borrowing base limitation and
taking into account outstanding letters of credit, the unused portion of working
capital commitments at such date was $190.0 million.

         In addition to its operating cash needs,  the Company believes its cash
requirements over the next several years consist primarily of (i) annual capital
expenditures of $50.0 to $60.0 million,  (ii) scheduled  principal  amortization
payments of term loans under the Credit  Agreement  (after  giving effect to the
use of a portion of the net proceeds from the Offering to prepay $8.9 million of
bank terms loans) of $29.6 million, $53.4 million, $53.4 million, $126.1 million
and $155.9 million over the next five years, respectively, (iii) expenditures of
approximately  $30.0  million  over the next three years  associated  with plant
rationalizations,  employee severance and administrative  workforce  reductions,
other  plant  exit  costs  and  employee  relocation  costs of AN Can,  (iv) the
Company's  interest  requirements,  including interest on working capital loans,
the principal  amount of which will vary depending  upon seasonal  requirements,
the bank term loans, most of which bear fluctuating  rates of interest,  and the
11-3/4%  Notes,  and (v) payments of  approximately  $5.0 million  (based on the
Company's  current  estimate  of its 1997 net  income) for federal and state tax
liabilities in 1997. Beginning in 1998, the Company expects to incur federal tax
liability at the alternative minimum tax rates then in effect.

         Silgan is a wholly owned subsidiary of Holdings, a holding company with
no significant  assets or operations  other than its investment in Silgan.  As a
result,  Holdings' ability to satisfy its obligations (including its obligations
under its indebtedness) may depend upon its receipt of funds paid by dividend or
distribution  or loaned,  advanced or transferred  by Silgan to Holdings.  Since
1995,  the Company has borrowed an aggregate  amount of $205.1 million under the
Credit  Agreement,  which  borrowings  were used to fund Holdings'  purchase and
redemption of $204.1 principal amount of Discount  Debentures and to pay accrued
interest on the Discount  Debentures.  On March 26, 1997,  Holdings redeemed the
remaining Discount Debentures with proceeds from the Offering.  Accordingly, the
Company's liquidity will no longer be affected by the Discount Debentures.

         After the redemption of the remaining  Discount  Debentures,  Holdings'
principal  liabilities are its  obligations in connection with the  Exchangeable
Preferred Stock (which Holdings expects will be exchanged prior to July 22, 1997
for the  Exchange  Debentures),  and its  guaranty  under the Credit  Agreement.
Because the Exchangeable  Preferred Stock does not require  dividends to be paid
in cash until October 2000 and the Exchange  Debentures do not require  interest
to be paid in cash until  January  15,  2001,  the  Company's  liquidity  is not
expected to be  affected by  Holdings'  liabilities  until such time.  Beginning
October 15, 2000,  Holdings  will be required to make  quarterly  cash  dividend
payments on the Exchangeable  Preferred Stock of approximately $2.8 million,  or
beginning  January 15, 2001,  Holdings will be required to make semi-annual cash
interest  payments on the Exchange  Debentures  of  approximately  $5.6 million.
Although the Credit Agreement  permits Silgan to dividend,  distribute,  loan or
advance  funds to Holdings to allow  Holdings to make cash payments of dividends
in respect of the  Exchangeable  Preferred  Stock or  interest in respect of the
Exchange  Debentures,  the 11-3/4% Notes  Indenture  presently  would not permit
Silgan to do so. The ability of Silgan to  transfer  funds to Holdings to enable
Holdings  to pay cash  dividends  on the  Exchangeable  Preferred  Stock or cash
interest on the Exchange  Debentures  when  required will depend upon the future
performance  of the  Company  and may  depend  upon the  ability  of  Silgan  to
refinance the 11-3/4% Notes.  There can be no assurance that Silgan will be able
to  refinance  the 11-3/4%  Notes or that Silgan will be  permitted  to transfer
funds to Holdings to enable  Holdings to pay cash dividends on the  Exchangeable
Preferred  Stock or cash  interest on the  Exchange  Debentures  when  required.
Management  believes  that the cash  dividend or cash  interest  obligations  of
Holdings with respect to the Exchangeable Preferred Stock or Exchange Debentures
will be met by Silgan  through cash  generated by operations or borrowings or by
Holdings through refinancings of its existing indebtedness or additional debt or
equity financings.


                                      -29-

<PAGE>




         Management  believes that cash  generated by operations  and funds from
working capital borrowings under the Credit Agreement will be sufficient to meet
the Company's  expected  operating  needs,  planned capital  expenditures,  debt
service and tax  obligations  for the  foreseeable  future.  The Company is also
continually  evaluating  and  pursuing  acquisition  opportunities  in the North
American  consumer  goods  packaging  market.  The  Company  may  need to  incur
additional  indebtedness  to  finance  any  such  acquisition  and to  fund  any
resulting  increased  operating  needs.  Depending upon market  conditions,  the
Company may also consider  refinancing  certain of its outstanding  indebtedness
through  other  debt  financings.  Such  financings  for  acquisitions  and debt
refinancings  will have to be  effected in  compliance  with  Holdings'  and the
Company's  agreements in respect of their  indebtedness then outstanding.  There
can be no assurance  that the Company will be able to effect any such  financing
for an acquisition or any such debt refinancing.

         The Credit  Agreement,  the 11-3/4% Notes  Indenture,  the Exchangeable
Preferred  Stock  and,  when  issued,  the  Exchange   Debentures  each  contain
restrictive  covenants that, among other things,  limit the Company's ability to
incur debt, sell assets and engage in certain transactions.  Management does not
expect these limitations to have a material effect on the Company's  business or
results of  operations.  The Company is in  compliance  with all  financial  and
operating covenants contained in such financing  agreements and believes that it
will continue to be in compliance during 1997 with all such covenants.

Effect of Inflation and Interest Rate Fluctuations

         Historically,  inflation has not had a material  effect on the Company,
other than to increase its cost of borrowing.  In general,  the Company has been
able to increase the sales  prices of its  products to reflect any  increases in
the prices of raw materials. See "--Overview--Net Sales--Long-term Contracts".

         Because the Company has  indebtedness  which bears interest at floating
rates,  the  Company's  financial  results  will  be  sensitive  to  changes  in
prevailing market rates of interest.  As of December 31, 1996, including working
capital loans of $27.8 million,  the Company had $701.1 million of  indebtedness
outstanding,  of which $366.1  million bore interest at floating  rates,  taking
into  account  interest  rate swap  agreements  entered  into by the  Company to
mitigate  the effect of interest  rate  fluctuations.  Under  these  agreements,
floating rate  interest was  exchanged for fixed rates of interest  ranging from
5.6% to 6.2% plus the Company's  incremental margin, which currently ranges from
2.5% to 3.0%. The notional  principal amounts of these agreements totaled $200.0
million,  including interest rate swap agreements entered into during the fourth
quarter of 1996 with a notional amount of $100.0 million, and mature in the year
1999.  Depending upon market  conditions,  the Company may enter into additional
interest  rate  swap or  hedge  agreements  (with  counterparties  that,  in the
Company's  judgment,  have  sufficient  creditworthiness)  to hedge its exposure
against interest rate volatility.

New Accounting Pronouncements

  Long-Lived Asset Impairment

         The Company  adopted SFAS No. 121,  "Accounting  for the  Impairment of
Long-Lived  Assets and for  Long-Lived  Assets to be Disposed  of," in the first
quarter of 1996. Under SFAS No. 121,  impairment  losses will be recognized when
events or changes in  circumstances  indicate that the  undiscounted  cash flows
generated by assets are less than the carrying value of such assets.  Impairment
losses are then measured by comparing the fair value of assets to their carrying
amount.  There were no impairment  losses  recognized during 1996. See Note 2 to
the Consolidated  Financial Statements of the Company included elsewhere in this
Annual Report on Form 10-K.



                                      -30-

<PAGE>



  Stock-Based Compensation

         In October 1995, the Financial  Accounting  Standards Board issued SFAS
No. 123,  "Accounting  for  Stock-Based  Compensation",  effective  for the 1996
fiscal  year.  Under SFAS No.  123,  compensation  expense  for all  stock-based
compensation plans would be recognized based on the fair value of the options at
the date of grant using an option  pricing  model.  As permitted  under SFAS No.
123,  the Company may either adopt the new  pronouncement  or follow the current
accounting  methods as prescribed  under APB No. 25. The Company has not elected
to adopt  SFAS No.  123 and  continues  to  recognize  compensation  expense  in
accordance  with APB No. 25. In addition,  the Company is required to include in
its  1996  year  end  financial  statements  pro  forma  information   regarding
compensation  expense  recognizable  under  SFAS  No.  123.  See  Note 16 to the
Consolidated  Financial  Statements  of the Company  included  elsewhere in this
Annual Report on Form 10-K.


Item 8.  Financial Statements and Supplementary Data.

         See Item 14 below for a listing of financial  statements  and schedules
included therein.


Item 9.  Changes  in  and  Disagreements  with  Accountants  on  Accounting  and
         Financial Disclosure.

         Not applicable.




                                      -31-

<PAGE>



                                    PART III


Item 10.  Directors and Executive Officers of the Registrant.

Directors and Executive Officers of Silgan and Holdings

         The following table sets forth certain information (ages as of December
31,  1996)  concerning  the  directors  and  executive  officers  of Silgan  and
Holdings.

Name                          Age   Position
----                          ---   --------
R. Philip Silver...........   54    Chairman of the Board, Co-Chief Executive
                                      Officer and Director
D. Greg Horrigan...........   53    President, Co-Chief Executive Officer and
                                      Director
Robert H. Niehaus..........   41    Director
Leigh J. Abramson..........   28    Director
Harley Rankin, Jr..........   57    Executive Vice President, Chief Financial
                                      Officer and Treasurer
Harold J. Rodriguez, Jr....   41    Vice President, Controller and Assistant
                                      Treasurer
Glenn A. Paulson...........   53    Vice President


Executive Officers of Containers

         The following table sets forth certain information (ages as of December
31, 1996) concerning the executive officers of Containers.

Name                          Age   Position
----                          ---   --------
James D. Beam..............   53    President
Gerald T. Wojdon...........   60    Vice President--Operations and Assistant
                                      Secretary
Gary M. Hughes.............   54    Vice President--Sales & Marketing
H. Dennis Nerstad..........   59    Vice President--Production Services
Joseph A. Heaney...........   43    Vice President--Finance


Executive Officers of Plastics

         The following table sets forth certain information (ages as of December
31, 1996) concerning the executive officers of Plastics.

Name                          Age   Position
----                          ---   --------
Russell F. Gervais.........   53    President
Howard H. Cole.............   51    Vice President and Assistant Secretary
Charles Minarik............   59    Vice President--Operations and Commercial
                                      Development
Alan H. Koblin.............   44    Vice President--Sales & Marketing
Colleen J. Jones...........   36    Vice President--Finance, Chief Financial
                                      Officer and Assistant Secretary



                                      -32-

<PAGE>



         Mr.  Silver  has been  Chairman  of the  Board and  Co-Chief  Executive
Officer of  Holdings  and Silgan  since  March  1994.  Mr.  Silver is one of the
founders of the Company and was formerly  President of Holdings and Silgan.  Mr.
Silver has been a Director of Holdings and Silgan since their inception in April
1989 and August 1987, respectively. Mr. Silver has been a Director of Containers
since its inception in August 1987 and Vice  President of  Containers  since May
1995.  Mr. Silver has been a Director of Plastics  since its inception in August
1987 and Chairman of the Board of Plastics  since March 1994.  Prior to founding
the Company in 1987, Mr. Silver was a consultant to the packaging industry.  Mr.
Silver was President of  Continental  Can Company from June 1983 to August 1986.
From September 1989 through August 1993, Mr. Silver held various  positions with
Sweetheart Holdings Inc. and Sweetheart Cup Company, Inc., including Chairman of
the  Board  and  Director.  Mr.  Silver  is  a  Director  of  Johnstown  America
Corporation.

         Mr.  Horrigan  has been  President  and Co-Chief  Executive  Officer of
Holdings and Silgan since March 1994. Mr. Horrigan is one of the founders of the
Company  and was  formerly  Chairman of the Board of  Holdings  and Silgan.  Mr.
Horrigan  has been a Director of Holdings  and Silgan  since their  inception in
April 1989 and August 1987, respectively.  Mr. Horrigan has been Chairman of the
Board of  Containers  and a Director  of  Containers  and  Plastics  since their
inception  in August  1987.  Mr.  Horrigan  was  Executive  Vice  President  and
Operating  Officer of Continental  Can Company from 1984 to 1987. From September
1989 through August 1993, Mr.  Horrigan held various  positions with  Sweetheart
Holdings Inc. and Sweetheart Cup Company,  Inc., including Chairman of the Board
and Director.

         Mr.  Niehaus  has been a Director of Holdings  since its  inception  in
April 1989 and a  Director  of  Silgan,  Containers  and  Plastics  since  their
inception in August 1987. Mr.  Niehaus joined Morgan Stanley & Co.  Incorporated
("Morgan  Stanley") in 1982 and has been a Managing  Director of Morgan  Stanley
since  1990.  Mr.  Niehaus  has been a Vice  Chairman  and a Director  of Morgan
Stanley Leveraged Equity Fund II, Inc. ("MSLEF II, Inc.") since January 1990 and
a Vice  Chairman and a Director of the managing  general  partner of the general
partner of Morgan Stanley Capital  Partners III, L.P. ("MSCP III") since January
1994.  Mr. Niehaus is also a Director of American  Italian Pasta  Company,  Fort
Howard  Corporation  and  Waterford  Crystal  Ltd.,  and  Chairman of  Waterford
Wedgwood UK plc.

         Mr.  Abramson has been a Director of Holdings,  Silgan,  Containers and
Plastics since  September 1996. He has been an Associate of Morgan Stanley since
1994 and a Vice President of MSLEF II, Inc. and of the managing  general partner
of the general partner of MSCP III since 1995. Mr. Abramson has been with Morgan
Stanley since 1990, first in the Corporate  Finance Division and, since 1992, in
the  Merchant  Banking  Division.  Mr.  Abramson  is also a Director of PageMart
Wireless, Inc., PageMart, Inc. and Jefferson Smurfit Corporation.

         Mr.  Rankin  has been  Executive  Vice  President  and Chief  Financial
Officer of Holdings  since its inception in April 1989 and Treasurer of Holdings
since  January  1992.  Mr. Rankin has been  Executive  Vice  President and Chief
Financial  Officer of Silgan since  January  1989 and  Treasurer of Silgan since
January  1992.  Mr. Rankin has been Vice  President of  Containers  and Plastics
since  January 1989 and was  Treasurer of Plastics from January 1994 to December
1994.  Prior to joining the Company,  Mr.  Rankin was Senior Vice  President and
Chief Financial Officer of Armtek Corporation. Mr. Rankin was Vice President and
Chief Financial  Officer of Continental Can Company from November 1984 to August
1986. From September 1989 to August 1993, Mr. Rankin was Vice  President,  Chief
Financial  Officer and Treasurer of Sweetheart  Holdings Inc. and Vice President
of Sweetheart Cup Company, Inc.

         Mr.  Rodriguez  has been Vice  President  of Holdings  and Silgan since
March 1994 and Controller  and Assistant  Treasurer of Holdings and Silgan since
March 1990. Prior to March 1990, Mr. Rodriguez


                                      -33-

<PAGE>



was Assistant  Controller  and  Assistant  Treasurer of Holdings and Silgan from
April 1989 and October 1987, respectively. Mr. Rodriguez has been Vice President
of Containers and Plastics since March 1994. From September 1989 to August 1993,
Mr.  Rodriguez was Controller,  Assistant  Secretary and Assistant  Treasurer of
Sweetheart  Holdings  Inc. and Assistant  Secretary  and Assistant  Treasurer of
Sweetheart Cup Company,  Inc. From 1978 to 1987,  Mr.  Rodriguez was employed by
Ernst & Young LLP, last serving as Senior Manager specializing in taxation.

         Mr.  Paulson  has been Vice  President  of  Holdings  and Silgan  since
January 1996. Mr. Paulson was employed by Containers to manage the transition of
AN Can from August 1995 to December  1995.  From January 1989 to July 1995,  Mr.
Paulson was employed by ANC,  last serving as Senior Vice  President and General
Manager, Food Metal and Specialty,  North America.  Prior to his employment with
ANC,  Mr.  Paulson  was  President  of  the  beverage  packaging  operations  of
Continental Can Company.

         Mr.  Beam has been  President  of  Containers  since  July  1990.  From
September 1987 to July 1990, Mr. Beam was Vice  President--Marketing  & Sales of
Containers.  Mr. Beam was Vice President and General  Manager of Continental Can
Company, Western Food Can Division, from March 1986 to September 1987.

         Mr. Wojdon has been Vice  President--Operations and Assistant Secretary
of Containers  since September 1987. From August 1982 to August 1987, Mr. Wojdon
was  General  Manager of  Manufacturing  of the Can  Division  of the  Carnation
Company.

         Mr.  Hughes has been Vice  President--Sales  & Marketing of  Containers
since July 1990. From February 1988 to July 1990, Mr. Hughes was Vice President,
Sales and Marketing of the Beverage  Division of Continental Can Company.  Prior
to February 1988, Mr. Hughes was employed by Continental  Can Company in various
regional sales positions.

         Mr.  Nerstad has been a Vice  President of  Containers  since  December
1993.   From   August   1989  to   December   1993,   Mr.   Nerstad   was   Vice
President--Distribution  and  Container  Manufacturing  of  Del  Monte  and  was
Director of  Container  Manufacturing  of Del Monte from  November  1983 to July
1989.  Prior to 1983, Mr. Nerstad was employed by Del Monte in various  regional
and plant positions.

         Mr. Heaney has been Vice President--Finance of Containers since October
1995. From September 1990 to October 1995, Mr. Heaney was Controller, Food Metal
and Specialty  Division of ANC. From August 1977 to August 1990,  Mr. Heaney was
employed by ANC and  American  Can Company in various  divisional,  regional and
plant finance/accounting positions.

         Mr. Gervais has been  President of Plastics  since December 1992.  From
September  1989 to  December  1992,  Mr.  Gervais  was Vice  President--Sales  &
Marketing  of  Plastics.  From March 1984 to  September  1989,  Mr.  Gervais was
President and Chief Executive Officer of Aim Packaging, Inc.

         Mr. Cole has been Vice  President and  Assistant  Secretary of Plastics
since September 1987. From April 1986 to September 1987, Mr. Cole was Manager of
Personnel of the Monsanto Engineered Products Division of Monsanto.

         Mr.  Minarik  has  been  Vice   President--Operations   and  Commercial
Development of Plastics  since May 1993.  From February 1991 to August 1992, Mr.
Minarik was President of Wheaton Industries Plastics Group. Mr. Minarik was Vice
President--Marketing of Constar International,  Inc. from March 1983 to February
1991.



                                      -34-

<PAGE>



         Mr. Koblin has been Vice President--Sales & Marketing of Plastics since
1994.  From 1992 to 1994,  Mr.  Koblin  was  Director  of Sales &  Marketing  of
Plastics.  From  1990 to 1992,  Mr.  Koblin  was  Vice  President  of  Churchill
Industries.

         Ms. Jones has been Vice  President--Finance and Chief Financial Officer
of Plastics  since  December  1994 and  Assistant  Secretary  of Plastics  since
November  1993.  From October  1993 to December  1994,  Ms. Jones was  Corporate
Controller   of  Plastics  and  from  July  1989  to  October   1993,   she  was
Manager--Finance  of  Plastics.  From July 1982 to July 1989,  Ms.  Jones was an
Audit Manager for Ernst & Young LLP.


Item 11.  Executive Compensation.

         The following  table sets forth  information  concerning the annual and
long term  compensation for services  rendered in all capacities to Holdings and
the Company  during the fiscal years ended  December 31, 1996,  1995 and 1994 of
those persons who at December 31, 1996 were (i) the Chief  Executive  Officer of
Silgan and (ii) the other four most  highly  compensated  executive  officers of
Silgan and its subsidiaries.  No director of Silgan or its subsidiaries received
any  compensation for serving as a director of Silgan or its  subsidiaries.  See
"Certain Relationships and Related Transactions--Management Agreements".

<TABLE>
<CAPTION>
                                            Summary Compensation Table

                                                                                  Long-Term
                                               Annual Compensation               Compensation
                                      ------------------------------------     ----------------
                                                                                    Awards
                                                                               ----------------
                                                                                  Securities
                                                                               Underlying Stock          All Other
Name and Principal Position           Year     Salary(a)(b)    Bonus(a)(c)      Options/SARs(d)       Compensation(e)
---------------------------           ----     ------------    -----------     ----------------       ---------------

<S>                                   <C>      <C>             <C>                 <C>                    <C>
R. Philip Silver...................
 (Chairman of the Board and
 Co-Chief Executive Officer
 of Silgan and Chairman of
 the Board of Plastics)               1996     $1,875,000          --                 --                     --
                                      1995      1,830,000          --                 --                     --
                                      1994      1,684,135          --                 --                     --



D. Greg Horrigan...................
 (President and Co-Chief
 Executive Officer of Silgan
 and Chairman of the Board
 of Containers)                       1996      1,875,000          --                 --                     --
                                      1995      1,830,000          --                 --                     --
                                      1994      1,684,135          --                 --                     --



Harley Rankin, Jr. ................
 (Executive Vice President, Chief
 Financial Officer and Treasurer
 of Silgan)                           1996        425,007          --                 --                     --
                                      1995        408,978          --                 --                     --
                                      1994        384,930          --              102,798                   --


James D. Beam......................
 (President of Containers)            1996        372,600      $112,339               --                  $73,805
                                      1995        361,200          --                 --                   66,394
                                      1994        350,000       169,092               --                   94,175

Russell F. Gervais.................
 (President of Plastics)              1996        234,000       111,400               --                    7,020
                                      1995        226,000        59,000               --                    5,085
                                      1994        216,804        83,300            134,462                   --
</TABLE>




                                      -35-

<PAGE>



-------------------
(a)  The compensation of Messrs. Horrigan, Silver, Rankin and Rodriguez reflects
     amounts as earned and was paid by S&H, Inc. ("S&H").  Such persons received
     no  direct   compensation   from  Holdings,   Silgan  or  their  respective
     subsidiaries.      See     "Certain      Relationships      and     Related
     Transactions--Management Agreements".
(b)  The  salaries  of Messrs.  Beam and  Gervais  were paid by  Containers  and
     Plastics, respectively.
(c)  Bonuses of Messrs.  Beam and  Gervais  were earned by them in such year and
     paid in the following year,  pursuant to the Silgan Containers  Corporation
     Performance  Incentive Plan and the Silgan Plastics  Corporation  Incentive
     Plan,  respectively.  Under such plans,  executive  officers  and other key
     employees of Containers  and Plastics may be awarded cash bonuses  provided
     that such company achieves certain assigned financial targets.
(d)  Reflects  options to  purchase  shares of Holdings  Common  Stock under the
     Stock  Option Plan,  and gives effect to the  17.133145 to 1 stock split of
     the  outstanding  Holdings  Common Stock  effected in  connection  with the
     Offering (the "Stock Split").  Such options are exercisable  ratably over a
     five-year  period which began on January 1, 1995. Mr. Gervais' options were
     calculated to give effect to the  conversion at the time of the Offering of
     his options  under  Plastics'  stock option plan to options under the Stock
     Option Plan.
(e)  In the case of Mr.  Beam,  includes  amounts  contributed  under the Silgan
     Containers   Corporation   Supplemental   Executive  Retirement  Plan  (the
     "Supplemental  Plan")  and  used  to pay  premiums  for  split-dollar  life
     insurance for Mr. Beam maintained in conjunction with the Supplemental Plan
     and includes amounts  contributed by Containers under the Silgan Containers
     Corporation  Deferred  Incentive  Savings Plan. In the case of Mr. Gervais,
     includes  amounts  allocated  to Mr.  Gervais  under  the  Silgan  Plastics
     Corporation Contributory Retirement Plan.


         The  following  table  provides  certain  information  with  respect to
options to purchase  Holdings  Common Stock held by the five executive  officers
named  in  the  Summary  Compensation  Table.  Prior  to the  completion  of the
Offering,  Messrs.  Beam and Gervais  held  options to purchase  common stock of
Containers  and  Plastics,  respectively,  under  stock  option  plans  of  such
subsidiaries.  Upon the completion of the Offering,  such options were converted
to options  under the Stock  Option  Plan in  accordance  with the terms of such
subsidiary stock option plans.


<TABLE>
<CAPTION>
                                        OPTION VALUES AT DECEMBER 31, 1996

                                                     Number of Securities                  Value of Unexercised
                                                          Underlying                           in-the-Money
                                                    Unexercised Options at                      Options at
                                                       December 31, 1996                   December 31, 1996(a)
                                              ------------------------------------ -------------------------------------
                    Name                         Exercisable      Unexercisable       Exercisable       Unexercisable
   --------------------------------------        -----------      -------------       -----------       -------------

<S>                                                <C>               <C>            <C>                  <C>
R. Philip Silver............................          --               --                  --                  --
D. Greg Horrigan............................          --               --                  --                  --
Harley Rankin, Jr.(b).......................       233,012           41,118         $ 4,091,680          $  676,661
James D. Beam(b)(c).........................       584,609             --            10,597,041                --
Russell F. Gervais(b)(c)....................        80,678           53,784           1,568,200           1,045,441
</TABLE>


(a)  For the purposes of this table, the fair market value per share of Holdings
     Common  Stock at December 31, 1996 was  estimated to be the initial  public
     offering price of $20.00 per share.
(b)  Options  are for shares of  Holdings  Common  Stock and give  effect to the
     Stock Split.
(c)  Each of Messrs.  Beam's and Gervais' options were calculated to give effect
     to the  conversion  at the time of the  Offering of such  person's  options
     under  Containers'  and  Plastics'  stock option  plans,  respectively,  to
     options under the Stock Option Plan. See "--Stock Option Plan".



                                      -36-

<PAGE>



Stock Option Plan

         The Board of  Directors  and  stockholders  of  Holdings  approved  the
establishment  of the Stock  Option Plan.  Under the Stock  Option  Plan,  as an
additional  means  of  attracting  and  retaining  officers  and key  personnel,
Holdings  may grant  options to  purchase  shares of  Holdings  Common  Stock to
participants.  Options  granted  may be either  non-qualified  stock  options or
"incentive stock options".

         The Board of  Directors of  Holdings,  through a committee  (the "Stock
Option  Committee"),  administers  the Stock  Option  Plan and has the power to,
among other things,  choose  participants  and fix the type of grant and all the
terms and conditions thereof,  including number of shares covered by a grant and
the exercise price. Only officers  (including  executive officers) and other key
employees of Holdings and the Company are eligible to  participate  in the Stock
Option Plan. The stock  issuable under the Stock Option Plan includes  shares of
Holdings'  authorized  and unissued or reacquired  Holdings  Common  Stock.  The
number of shares for which  options may be granted  under the Stock  Option Plan
may not exceed 3,533,417 shares.

         Options are  exercisable  over such period as  determined  by the Stock
Option  Committee,  and generally,  except as otherwise  determined by the Stock
Option Committee,  no option may remain exercisable more than ten years from the
grant date, subject to earlier termination as provided in the Stock Option Plan.
Options  become  exercisable no earlier than one year from the date of grant and
in such installments as specified in the option agreement therefor.

         All options granted under the Stock Option Plan must be evidenced by an
option agreement  between  Holdings and the option  recipient  embodying all the
terms and  conditions  of the option grant,  provided  that (i) incentive  stock
options  granted must comply with  Section 422 of the  Internal  Revenue Code of
1986,  as  amended  (the  "Code"),  (ii) no  option  shall  be  transferable  or
assignable  other  than by will or the laws of  descent  and  distribution  and,
during the lifetime of the recipient,  such option shall be exercisable  only by
the recipient,  (iii) all options must expire upon or remain  exercisable  for a
limited  time after  termination  of  employment,  all as specified in the Stock
Option  Plan,  and (iv) upon  exercise of options,  full  payment for the shares
covered thereby shall be made in cash or shares of Holdings Common Stock already
owned or a combination of cash and shares of Holdings Common Stock.

         Concurrent  with the Offering,  all  outstanding  stock options  issued
under the stock option plans of Containers  and Plastics were converted to stock
options under the Stock Option Plan in accordance  with the terms of such plans,
and Containers' and Plastics' stock option plans  terminated.  As a result,  the
only stock options  outstanding  since the  completion of the Offering are stock
options under the Stock Option Plan.

         As of the date of this Annual Report on Form 10-K,  options to purchase
1,890,103  shares of  Holdings  Common  Stock were  outstanding  under the Stock
Option  Plan at exercise  prices  ranging  from $0.56 to $22.13 per share.  With
respect to certain outstanding options, Holdings has an obligation to pay to the
optionees an amount per option as specified in the applicable  option  agreement
(determined in connection  with the 1989 Mergers with respect to the issuance of
options  under the Stock Option Plan in exchange for options under a predecessor
plan) upon exercise of such options.  An aggregate  amount of $943,589  would be
payable by  Holdings to such  optionees  upon the  exercise of such  outstanding
options.



                                      -37-

<PAGE>



Pension Plans

         The  Company  has  established  pension  plans  (the  "Pension  Plans")
covering substantially all of the salaried employees of Containers and Plastics,
respectively,  including the executive  officers (the "Containers  Pension Plan"
and the "Plastics  Pension Plan,"  respectively).  The Pension Plans are defined
benefit plans intended to be qualified pension plans under Section 401(a) of the
Code,  under which pension costs are determined  annually on an actuarial  basis
with contributions made accordingly.

         The following table  illustrates the estimated annual normal retirement
benefits that are payable under the Containers Pension Plan. Such benefit levels
assume retirement at age 65, the years of service shown,  continued existence of
the Containers  Pension Plan without  substantial change and payment in the form
of a single life annuity.

<TABLE>
<CAPTION>
                                           Containers Pension Plan Table

                                                    Years of Service
  Final Average      -----------------------------------------------------------------------------
    Earnings          10            15             20            25             30             35
  -------------      ----          ----           ----          ----           ----           ----
<S>                 <C>          <C>            <C>           <C>            <C>            <C>
   $  50,000        $7,130       $10,640        $14,260       $17,830        $21,390        $24,960
      75,000        11,510        17,260         23,010        28,760         34,520         40,270
     100,000        15,880        23,820         31,760        39,700         47,640         55,580
     125,000        20,260        30,380         40,510        50,640         60,770         70,890
     150,000        24,630        36,950         49,260        61,580         73,890         86,210
     175,000        29,010        43,510         58,010        72,510         87,020        101,520
     200,000        33,380        50,070         66,760        83,450        100,140        116,830
     225,000        37,760        56,630         75,510        94,390        113,270        132,140
</TABLE>


         Benefits   under  the   Containers   Pension  Plan  are  based  on  the
participant's  average base pay (the "Salary" column in the Summary Compensation
Table) over the final three years of employment.  The amount of average base pay
taken into  account for any year is limited by Section  401(a)(17)  of the Code,
which imposes a cap of $150,000 (to be indexed for  inflation)  on  compensation
taken into account for 1994 and later years (the limit for 1993 was $235,840).

         Benefits  under the  Containers  Pension Plan accrued  prior to July 1,
1994 may be offset by a social security amount (the plan provides benefits based
on the greater of three  formulas;  prior to July 1, 1994,  one of such formulas
provided for a social  security  offset).  Each of the benefit  estimates in the
above table is based on the  formula  that  produces  the  greatest  benefit for
individuals with the stated earnings and years of service.

         As of December 31, 1996,  James D. Beam,  the only  eligible  executive
officer  named in the  Summary  Compensation  Table,  had nine years of credited
service under the  Containers  Pension Plan. Mr. Beam also  participates  in the
Supplemental  Plan,  which is designed to make up for benefits not payable under
the Containers  Pension Plan due to Code limitations.  Mr. Beam's benefits under
the Supplemental  Plan are funded through a split-dollar  life insurance policy;
income  attributable to this life insurance policy is included in the "All Other
Compensation" column of the Summary Compensation Table.

         The following table  illustrates the estimated annual normal retirement
benefits that are payable under the Plastics  Pension Plan.  Such benefit levels
assume retirement age at 65, the years of service shown,  continued existence of
the Plastics Pension Plan without  substantial change and payment in the form of
a single life annuity.


                                      -38-

<PAGE>



<TABLE>
<CAPTION>

                                            Plastics Pension Plan Table

                                                   Years of Service
  Final Average      -----------------------------------------------------------------------------
    Earnings          10            15             20            25             30             35
  -------------      ----          ----           ----          ----           ----           ----
<S>                 <C>          <C>            <C>           <C>            <C>            <C>
    $ 50,000        $7,000       $10,550        $14,000       $17,500        $21,000        $24,500
      75,000        10,500        15,750         21,000        26,250         31,500         36,750
     100,000        14,000        21,000         28,000        35,000         42,000         49,000
     125,000        17,500        26,250         35,000        43,750         52,500         61,250
     150,000        21,000        31,500         42,000        52,500         63,000         73,950
     175,000        24,500        36,750         49,000        61,250         73,950         87,075
     200,000        28,000        42,000         56,000        70,200         85,200        100,200
     225,000        31,500        47,250         63,000        79,575         96,450        113,325
</TABLE>


         Benefits under the Plastics Pension Plan are based on the participant's
average total cash compensation (the "Salary" and "Bonus" columns in the Summary
Compensation  Table) over the final 36 months of  employment or over the highest
three of the final five calendar  years of  employment,  whichever  produces the
greater average  compensation.  In computing this average,  compensation for any
year cannot exceed 125% of base pay.  Compensation used in determining  benefits
is also  limited by Section  401(a)(17)  of the Code,  which  imposes the limits
indicated above.

         Benefits  under  the  Plastics  Pension  Plan may be offset by a social
security  amount  (the plan  provides  benefits  based on the  greater  of three
formulas,  only one of which provides for a social security offset). Each of the
benefit  estimates in the above table is based on the formula that  produces the
greatest benefit for individuals with the stated earnings and years of service.

         As of  December  31,  1996,  Russell  F.  Gervais,  the  only  eligible
executive  officer named in the Summary  Compensation  Table, had seven years of
credited service under the Plastics Pension Plan.

Certain Employment Agreements

         Certain  executive  officers and other key employees of Containers  and
Plastics   (including  Messrs.   Beam  and  Gervais)  have  executed  employment
agreements.  The initial  term of each such  employment  agreement  is generally
three years from its effective date and is automatically extended for successive
one year  periods  unless  terminated  pursuant to the terms of such  agreement.
Generally,  these  employment  agreements  provide for,  among other  things,  a
minimum  severance benefit equal to the employee's base salary and benefits for,
in most cases, a period of one year following  termination  (or the remainder of
the term of the  agreement,  if longer) (i) if the employee is terminated by his
employer for any reason other than  disability  or for cause as specified in the
agreement or (ii) if the employee  voluntarily  terminates  employment  due to a
demotion  and, in some cases,  significant  relocation,  all as specified in the
agreement.

         The foregoing  summaries of the various benefit plans and agreements of
the Company are qualified by reference to such plans and  agreements,  copies of
certain of which have been filed as exhibits to this Annual Report on Form 10-K.



                                      -39-

<PAGE>



Compensation Committee Interlocks and Insider Participation

         Silgan  did  not  have  a  Compensation   Committee  during  1996.  The
compensation of Messrs. Silver, Horrigan,  Rankin and Rodriguez was paid by S&H,
which was paid by  Holdings  and the Company for  providing  certain  management
services to Holdings and the Company  pursuant to the Management  Agreements (as
defined  in  "Certain   Relationships   and   Related   Transactions--Management
Agreements").  See "Certain  Relationships and Related  Transactions--Management
Agreements".  The  compensation of all other executive  officers of Holdings and
the Company was determined by the senior management of Holdings and the Company.


Item 12.  Security Ownership of Certain Beneficial Owners and Management.

Certain Beneficial Owners of Silgan's Capital Stock

         All of the outstanding shares of common stock of Silgan,  consisting of
one share of Class A Common  Stock,  par  value  $.01 per  share  (the  "Class A
Stock"),  and one share of Class B Common  Stock,  par value $.01 per share (the
"Class B Stock"), are owned by Holdings. Holdings' address is 4 Landmark Square,
Stamford, CT 06901.

Certain Beneficial Owners of Holdings' Capital Stock

         The  following  table sets forth,  as of  February  28,  1997,  certain
information  with  respect to the  beneficial  ownership  by certain  persons of
outstanding shares of capital stock of Holdings.  Except as otherwise  described
below,  each of the persons  named in the table has sole  voting and  investment
power with respect to the securities beneficially owned.

<TABLE>
<CAPTION>
                                                 Number of Shares of              Percentage Ownership of
                                             Holdings Common Stock Owned         Holdings Common Stock<F1>
                                             ---------------------------         -------------------------

<S>                                                   <C>                                 <C>
R. Philip Silver <F2>.....................            3,576,545                           18.96%
D. Greg Horrigan <F2>.....................            3,576,545                           18.96%
Robert H. Niehaus <F3>....................                --                                --
Leigh J. Abramson <F3>....................                --                                --
Harley Rankin, Jr. <F4>...................              233,012                            1.22%
James D. Beam <F5>........................              584,809                            3.01%
Russell F. Gervais <F6>...................               80,728                              *
The Morgan Stanley Leveraged Equity
  Fund II, L.P. <F7>......................            5,835,842                           30.94%
All officers and directors as a group.....            8,735,191                           42.73%

-------------------
<FN>
<F1> An asterisk  denotes  beneficial  ownership  of 1% or less of the  Holdings
     Common Stock.
<F2> Director of Holdings,  Silgan, Containers and Plastics.  Messrs. Silver and
     Horrigan  are  parties to a voting  agreement  pursuant  to which they have
     agreed  to use their  best  efforts  to vote  their  shares as a block.  In
     addition,  Messrs.  Silver and Horrigan share voting and  investment  power
     with  respect to one (1) share of  Holdings  Common  Stock,  which share of
     Holdings  Common  Stock is owned by S&H.  The  address for such person is 4
     Landmark Square, Stamford, CT 06901.
<F3> Director of Holdings, Silgan, Containers and Plastics. The address for such
     person  is c/o  Morgan  Stanley  & Co.  Incorporated,  1221  Avenue  of the
     Americas, New York, NY 10020.
<F4> Reflects  shares that may be acquired  through the exercise of vested stock
     options  granted   pursuant  to  the  Stock  Option  Plan.  See  "Executive
     Compensation--Stock Option Plan". The address for such person is 4 Landmark
     Square, Stamford, CT 06901.


                                      -40-

<PAGE>



<F5> Reflects  shares that may be acquired  through the exercise of vested stock
     options  granted   pursuant  to  the  Stock  Option  Plan.  See  "Executive
     Compensation--Stock  Option  Plan".  The  address  for such person is 21800
     Oxnard Street, Woodland Hills, CA 91367.
<F6> Reflects  shares that may be acquired  through the exercise of vested stock
     options  granted   pursuant  to  the  Stock  Option  Plan.  See  "Executive
     Compensation--Stock  Option Plan".  The address for such person is 14515 N.
     Outer Forty, Chesterfield, MO 63017.
<F7> The address for The Morgan Stanley  Leveraged Equity Fund II, L.P., is 1221
     Avenue of the Americas, New York, NY 10020.
</FN>
</TABLE>

         See  "--Description  of Holdings Capital Stock" and  "--Description  of
Stockholders  Agreements" for additional  information about the capital stock of
Holdings, the holders thereof and certain arrangements among them.

Description of Common Stock of Silgan

         Under  Silgan's  Restated  Certificate  of  Incorporation,  Silgan  has
authority to issue 1,000 shares of Class A Stock,  1,000 shares of Class B Stock
and 1,000 shares of Class C Common Stock, par value $.01 per share (the "Class C
Stock").  Silgan currently has one share of Class A Stock and one share of Class
B Stock  outstanding,  which  shares were issued to Holdings on June 30, 1989 in
conjunction  with the  effectiveness  of the 1989 Mergers.  No shares of Class C
Stock are currently outstanding.


Description of Holdings Capital Stock

  General

         Holdings is incorporated under the laws of the State of Delaware. Under
its Certificate of  Incorporation,  Holdings has authority to issue  100,000,000
shares of Holdings Common Stock, par value $.01 per share, and 10,000,000 shares
of  preferred  stock,  par  value  $.01 per  share.  As of  February  28,  1997,
18,862,834  shares  of  Holdings  Common  Stock  were  issued  and  outstanding,
12,988,931 of which are  beneficially  owned by Messrs.  Silver and Horrigan and
MSLEF.  There are  53,258  shares of  Exchangeable  Preferred  Stock  issued and
outstanding.  All  outstanding  shares  of  capital  stock  are  fully  paid and
nonassessable.

  Common Stock

         Each  outstanding  share of Holdings  Common Stock  entitles the holder
thereof  to one  vote  on all  matters  submitted  to a  vote  of  stockholders,
including  the  election  of  directors.  There is no  cumulative  voting in the
election  of  directors;   consequently,  the  holders  of  a  majority  of  the
outstanding  shares of Holdings Common Stock can elect all of the directors then
standing for election. See "--Description of Stockholders  Agreements".  Holders
of Holdings Common Stock are entitled to receive ratably such dividends, if any,
as may be declared  from time to time by  Holdings'  Board of  Directors  out of
funds legally available therefor.  In the event of any liquidation,  dissolution
or winding-up of the affairs of Holdings,  holders of Holdings Common Stock will
be entitled to share ratably in the assets of Holdings remaining after provision
for payment of liabilities to creditors and  obligations to holders of preferred
stock.  Holders  of  Holdings  Common  Stock have no  preemptive,  subscription,
redemption  or  conversion  rights  and are not  liable  for  further  calls  or
assessments.  In addition,  any action  taken by the holders of Holdings  Common
Stock must be taken at a meeting and may not be taken by consent in writing, and
a special meeting of the  stockholders may only be called by the Chairman of the
Board or the President of Holdings or by a majority of the Board of Directors of
Holdings, and may not be called by the holders of Holdings Common Stock.


                                      -41-

<PAGE>



  Preferred Stock

         Holdings' Board of Directors,  without  stockholder  authorization,  is
authorized  to issue up to 10,000,000  shares of preferred  stock in one or more
series and to fix the preferences,  rights and privileges thereof, including any
dividend rights,  conversion rights, voting rights,  redemption rights and terms
of any sinking fund provisions,  liquidation  preferences,  the number of shares
constituting a series and the designation of such series. The Board may, without
stockholder  approval,  issue  preferred stock with voting and other rights that
could adversely affect the voting power of the holders of Holdings Common Stock.
Currently,  53,258  shares  of  Exchangeable  Preferred  Stock  are  issued  and
outstanding.  However,  prior to July 22, 1997, Holdings intends to exchange its
outstanding  Exchangeable Preferred Stock for the Exchange Debentures.  Holdings
has no present  plans to issue any  additional  shares of preferred  stock other
than shares that may be issued to pay dividend  obligations on the  Exchangeable
Preferred Stock.


Description of Stockholders Agreements

         Holdings, MSLEF II, BTNY and Messrs. Silver and Horrigan are parties to
the  Stockholders  Agreement  dated as of  December  21, 1993 (as  amended,  the
"Stockholders  Agreement")  which  provides for certain  rights and  obligations
among  such  stockholders  and  between  such  stockholders  and  Holdings.  The
following is a summary of the material provisions of the Stockholders Agreement,
which is filed as an exhibit to this Annual Report on Form 10-K.

         The  Stockholders  Agreement  provides that for a period of eight years
after  the  Offering,  MSLEF II shall  have the  right to  demand  two  separate
registrations of its shares of Holdings Common Stock;  provided,  however,  that
such demand  right will  terminate at such time as MSLEF II,  together  with its
affiliates,  owns less than five percent of the issued and outstanding shares of
Holdings  Common  Stock.  If,  at any time or from  time to time for a period of
eight years after the Offering,  Holdings shall determine to register additional
shares  of  Holdings  Common  Stock  (other  than  in  connection  with  certain
non-underwritten  offerings),  Holdings  will offer  each of MSLEF II,  BTNY and
Messrs.  Silver and  Horrigan  the  opportunity  to register  shares of Holdings
Common Stock it holds in a "piggyback registration".

         The  Stockholders  Agreement  prohibits the transfer  prior to June 30,
1999 by MSLEF II or by Messrs.  Silver or Horrigan  of  Holdings'  Common  Stock
without the prior written  consent of the others,  except for (i) transfers made
in connection with a public  offering or a Rule 144 Open Market  Transaction (as
defined in the  Stockholders  Agreement),  (ii)  transfers made to an affiliate,
which,  in the  case of a  transfer  by  MSLEF  II to an  affiliate,  must be an
Investment  Entity (defined  generally to be any person who is primarily engaged
in the business of investing in securities of other  companies and not taking an
active role in the  management or operations of such  companies),  (iii) certain
transfers  by MSLEF II to an  Investment  Entity  or,  in the  event of  certain
defaults under the  Management  Agreement  between S&H and Holdings,  to a third
party,  in each case that comply with certain rights of first refusal granted to
the Group (the  "Group"  is defined  generally  to mean,  collectively,  Messrs.
Silver and Horrigan and their  respective  affiliates and certain related family
transferees and estates,  with Mr. Silver and his affiliates and certain related
family transferees and estates being deemed to be collectively one member of the
Group,   and  Mr.  Horrigan  and  his  affiliates  and  certain  related  family
transferees  and estates being deemed to be  collectively  another member of the
Group) set forth in the Stockholders Agreement, (iv) certain transfers by either
member of the Group to a third party that comply  with  certain  rights of first
refusal  granted to the other  member of the Group and MSLEF II set forth in the
Stockholders  Agreement,  and (v) in the case of MSLEF II, a distribution of all
or substantially all of the shares of Holdings' Common


                                      -42-

<PAGE>



Stock  then  owned  by  MSLEF  II  to  the   partners  of  MSLEF  II  (a  "MSLEF
Distribution").  Notwithstanding  the  foregoing,  each of  Messrs.  Silver  and
Horrigan and MSLEF II may pledge his or its shares of Holdings'  Common Stock to
a lender or lenders reasonably  acceptable to Holdings to secure a loan or loans
to him or it. In the event of any  proposed  foreclosure  of such  pledge,  such
shares  will be  subject  to certain  rights of first  refusal  set forth in the
Stockholders Agreement.

         Concurrent with the Offering,  MSLEF II and Messrs. Silver and Horrigan
entered into the Stockholders Agreement dated February 14, 1997 (the "Principals
Stockholders  Agreement").  The Principals  Stockholders Agreement provides that
(i) for so long as MSLEF II and its  affiliates  (excluding  the  non-affiliated
limited  partners of MSLEF II who acquire  shares of Holdings  Common Stock from
MSLEF II in a MSLEF Distribution) hold at least one-half of the number of shares
of Holdings  Common Stock held by MSLEF II  immediately  prior to the  Offering,
each of Messrs. Silver and Horrigan will use his best efforts (including to vote
any shares of Holdings  Common  Stock owned or  controlled  by him) to cause the
nomination  and election of two members of the Board of Directors of Holdings to
be chosen by MSLEF II; provided, however, that each such nominee shall be either
(a) an employee  of Morgan  Stanley  whose  primary  responsibility  is managing
investments for MSLEF II (or a successor or related partnership) or (b) a person
reasonably  acceptable  to the Group not  engaged  in (as a  director,  officer,
employee,  agent or  consultant  or as a holder of more than five percent of the
equity  securities of) a business  competitive  with that of Holdings,  and (ii)
from  and  after  the  time  that  MSLEF II and its  affiliates  (excluding  the
non-affiliated  limited  partners  of MSLEF II who  acquire  shares of  Holdings
Common Stock from MSLEF II in a MSLEF  Distribution)  hold less than one-half of
the number of shares of Holdings Common Stock held by MSLEF II immediately prior
to the Offering and until such time that MSLEF II and its affiliates  (excluding
the  non-affiliated  limited partners of MSLEF II who acquire shares of Holdings
Common Stock from MSLEF II in a MSLEF  Distribution) hold less than five percent
(5%) of the  outstanding  Holdings  Common  Stock  beneficially  owned,  each of
Messrs.  Silver and Horrigan  will use his best efforts  (including  to vote any
shares  of  Holdings  Common  Stock  owned or  controlled  by him) to cause  the
nomination  and  election of one member of the Board of Directors of Holdings to
be chosen by MSLEF II; provided,  however, that such nominee shall be (i) either
an  employee  of  Morgan  Stanley  whose  primary   responsibility  is  managing
investments  for MSLEF II (or a  successor  or  related  partnership)  or (ii) a
person  reasonably  acceptable  to the  Group  not  engaged  in (as a  director,
officer,  employee, agent or consultant or as a holder of more than five percent
of the equity securities of) a business competitive with that of Holdings.

         In addition,  the Principals  Stockholders  Agreement provides that (i)
for so long as the  Group  holds at least  one-half  of the  number of shares of
Holdings  Common  Stock held by it in the  aggregate  on the date of this Annual
Report on Form 10-K,  MSLEF II will use its best efforts  (including to vote any
shares  of  Holdings  Common  Stock  owned or  controlled  by it) to  cause  the
nomination  and  election  of two  individuals  nominated  by the  holders  of a
majority of the shares of Holdings  Common Stock held by the Group as members of
the Board of Directors of Holdings; provided, however, that at least one of such
nominees  shall be Mr. Silver or Mr.  Horrigan and the other person,  if not Mr.
Silver or Mr. Horrigan,  will be a person reasonably  acceptable to MSLEF II, so
long as  MSLEF  II and its  affiliates  (excluding  the  non-affiliated  limited
partners of MSLEF II who may acquire shares of Holdings  Common Stock from MSLEF
II in a MSLEF  Distribution)  hold at least  one-half of the number of shares of
Holdings Common Stock held by MSLEF II immediately  prior to the Offering,  (ii)
from and after the time that the Group holds less than one-half of the number of
shares of Holdings  Common Stock held by it in the  aggregate on the date hereof
and until  such time that the Group  holds  less than five  percent  (5%) of the
outstanding Holdings Common Stock beneficially owned, MSLEF II will use its best
efforts  (including  to vote  any  shares  of  Holdings  Common  Stock  owned or
controlled  by it) to  cause  the  nomination  and  election  of one  individual
nominated  by the holders of a majority of the shares of Holdings  Common  Stock
held by the Group as a member of the Board of Directors of Holdings;


                                      -43-

<PAGE>



provided,  however,  that such  nominee  shall be Silver or Horrigan  or, if not
Silver or Horrigan, a person reasonably acceptable to MSLEF II, so long as MSLEF
II and its affiliates (excluding the non-affiliated limited partners of MSLEF II
who  acquire  shares  of  Holdings  Common  Stock  from  MSLEF  II  in  a  MSLEF
Distribution)  hold at least one-half of the number of shares of Holdings Common
Stock held by MSLEF II immediately  prior to the Offering,  and (iii) so long as
the Group holds at least  one-half  of the number of shares of  Holdings  Common
Stock  held by it in the  aggregate  on the date of this  Annual  Report on form
10-K,  the Group will have the right to nominate for  election all  directors of
Holdings other than the directors referred to above in this paragraph and in the
preceding  paragraph,  and upon such  nomination by the Group such nominees will
stand for election to Holdings'  Board of Directors in accordance with Holdings'
Restated  Certificate  of  Incorporation,  and MSLEF II will vote all  shares of
Holdings  Common Stock owned or controlled by it and its affiliates  against any
director  standing for election for  Holdings'  Board of Directors  that has not
been nominated by the Group,  other than the directors referred to above in this
paragraph and in the preceding paragraph.

         The Principals  Stockholders  Agreement  further provides that MSLEF II
will vote all shares of Holdings Common Stock held by it against any unsolicited
merger, or sale of Holdings'  business or assets, if such transaction is opposed
by the holders of a majority of the shares of Holdings  Common Stock held by the
Group,  unless as of the  applicable  record date for such vote, the Group holds
less than ninety  percent of the number of shares of Holdings  Common Stock held
by it in the aggregate at the date of this Annual Report on Form 10-K.

         The foregoing provisions of the Principals Stockholders Agreement could
have the effect of delaying,  deferring or preventing a change of control of the
Company  and  preventing  the  stockholders  from  receiving a premium for their
shares of Holdings Common Stock in any proposed acquisition of the Company.


Item 13.  Certain Relationships and Related Transactions.

Management Agreements

         Holdings,  Silgan, Containers and Plastics each entered into an amended
and  restated  management  services  agreement  dated as of  December  21,  1993
(collectively,  the "Management Agreements") with S&H to replace in its entirety
its then existing management services agreement,  as amended, with S&H. Pursuant
to the Management  Agreements,  S&H provided  Holdings,  Silgan,  Containers and
Plastics  and  their  respective   subsidiaries  with  general   management  and
administrative services (the "Services"). The Management Agreements provided for
payments to S&H (i) on a monthly basis, of $5,000 plus an amount equal to 2.475%
of consolidated earnings before depreciation, interest and taxes of Holdings and
its  subsidiaries  ("Holdings  EBDIT"),  for such calendar  month until Holdings
EBDIT for the  calendar  year  shall  have  reached  an amount  set forth in the
Management  Agreements for such calendar year (the "Scheduled Amount") and 1.65%
of Holdings  EBDIT for such calendar month to the extent that Holdings EBDIT for
the calendar year shall have  exceeded the  Scheduled  Amount but shall not have
been greater than an amount (the "Maximum  Amount") set forth in the  Management
Agreements  and (ii) on a  quarterly  basis,  of an  amount  equal to  2.475% of
Holdings  EBDIT for such calendar  quarter until Holdings EBDIT for the calendar
year shall have  reached the  Scheduled  Amount and 1.65% of Holdings  EBDIT for
such calendar  quarter to the extent that  Holdings  EBDIT for the calendar year
shall have  exceeded the  Scheduled  Amount but shall not have been greater than
the Maximum Amount (the "Quarterly  Management  Fee").  The Scheduled Amount was
$83.5  million for the calendar  year 1996,  and the Maximum  Amount was $98.101
million for the calendar year 1996. The Management Agreements provided that upon
receipt by Silgan of a notice from Bankers Trust that certain events of


                                      -44-

<PAGE>



default under the Credit Agreement have occurred,  the Quarterly  Management Fee
shall continue to accrue,  but shall not be paid to S&H until the fulfillment of
certain conditions, as set forth in the Management Agreements.

         Additionally, the Management Agreements provided that Holdings, Silgan,
Containers, Plastics and their respective subsidiaries shall reimburse S&H, on a
monthly  basis,  for all  out-of-pocket  expenses  paid by S&H in providing  the
Services,  including fees and expenses to consultants,  subcontractors and other
third parties,  in connection with such Services.  All fees and expenses paid to
S&H under each of the Management  Agreements were credited  against amounts paid
to S&H under the other Management Agreements.  Under the terms of the Management
Agreements,  Holdings,  Silgan,  Containers and Plastics had agreed,  subject to
certain exceptions,  to indemnify S&H and its affiliates,  officers,  directors,
employees,  subcontractors,  consultants  or  controlling  persons  against  any
losses,  damages, costs and expenses they may sustain arising in connection with
the Management Agreements.

         The  Management   Agreements  also  provided  that  S&H  may  select  a
consultant,  subcontractor or agent to provide the Services. S&H retained Morgan
Stanley to render  financial  advisory  services to S&H. In connection with such
retention, S&H agreed to pay Morgan Stanley a fee equal to 9.1% of the fees paid
to S&H under the Management Agreements.

         Concurrent with the Offering, each of Holdings,  Silgan, Containers and
Plastics  entered into an amended and  restated  management  services  agreement
(collectively,  the "New  Management  Agreements")  with S&H to replace in their
entirety  the  Management  Agreements.  The New  Management  Agreements  contain
substantially the same terms as the Management Agreements, except that after the
initial term of the New Management  Agreements  (which  continues until June 30,
1999),  the  New  Management   Agreements  will  be  automatically  renewed  for
successive  one-year terms unless either party gives written notice at least 180
days prior to the end of the then current term of its election not to renew. The
independent  directors of Holdings  will  determine  on behalf of the  companies
whether to give such written notice not to renew. The New Management  Agreements
may be terminated (i) at the option of each of the respective companies upon the
failure or refusal of S&H to perform its  obligations  under the New  Management
Agreements,  if such failure or refusal  continues  unremedied  for more than 60
days after written  notice of its existence  shall have been given;  (ii) at the
option of S&H upon the failure or refusal of any of the respective  companies to
perform its obligations under the New Management Agreements,  if such failure or
refusal  continues  unremedied for more than 60 days after written notice of its
existence  shall have been given;  (iii) at the option of S&H or the  respective
companies (a) if S&H or one of the  companies is declared  insolvent or bankrupt
or a  voluntary  bankruptcy  petition  is  filed  by any of  them,  (b) upon the
occurrence  of any of the  following  events  with  respect to S&H or one of the
companies  if not cured,  dismissed or stayed  within 45 days:  the filing of an
involuntary petition in bankruptcy,  the appointment of a trustee or receiver or
the  institution  of  a  proceeding   seeking  a  reorganization,   arrangement,
liquidation or dissolution, (c) if S&H or one of the companies voluntarily seeks
a  reorganization  or  arrangement  or makes an  assignment  for the  benefit of
creditors  or (d) upon the  death or  permanent  disability  of both of  Messrs.
Silver and  Horrigan;  (iv) upon at least 180 days prior  written  notice at the
option of each of the respective companies for any reason; (v) upon at least 180
days prior  written  notice at the option of S&H for any reason other than Cause
or a Change of Control (each as defined in the New Management Agreements);  (vi)
at the  option  of S&H  after a Change of  Control;  (vii) at the  option of the
respective companies in the event of criminal conduct or gross negligence by S&H
in the  performance  of the  Services;  or  (viii)  at the  option of S&H or the
respective  companies  upon  the  termination  of  any  of  the  New  Management
Agreements  for  Cause  (as  defined  therein).  The New  Management  Agreements
prohibit S&H from  competing  with the Company during the term thereof and, only
if S&H terminates the New  Management  Agreements  pursuant to clause (v) above,
for a period of one year after such termination.  The New Management  Agreements
provide that, in the event that they


                                      -45-

<PAGE>



are terminated  pursuant to clause (iv) above, each of the respective  companies
will be required to pay to S&H the present  value of the amount of the  payments
that would have been  payable to S&H  thereunder  through the end of the initial
term or renewed term, as the case may be,  thereof.  In addition,  under the New
Management  Agreements the Scheduled Amount is $89.5 million,  $95.5 million and
$101.5 million for the calendar years 1997, 1998 and 1999, respectively, and the
Maximum Amount is $100.504  million,  $102.964  million and $105.488 million for
the calendar  years 1997,  1998 and 1999,  respectively.  For the calendar  year
2000, the Scheduled Amount and the Maximum Amount is $108.653  million,  and for
each calendar year thereafter the Scheduled  Amount and Maximum Amount increases
by 3% from that of the previous year.

         The Company  believes  that it is difficult  to  determine  whether the
Management  Agreements  were, and whether the New Management  Agreements are, on
terms no less favorable than those available from  unaffiliated  parties because
of the personal nature of the services provided thereunder and the expertise and
skills of the  individuals  providing such services.  The Company  believes that
arrangements  under the Management  Agreements  were, and that the  arrangements
under the New Management Agreements are, fair to both parties.

         For the  years  ended  December  31,  1996,  1995 and  1994,  under the
Management  Agreements,   S&H  earned  aggregate  fees,  including  reimbursable
expenses and fees payable to Morgan Stanley,  of $5.3 million,  $5.4 million and
$5.0 million, respectively,  from Holdings, Silgan, Containers and Plastics, and
during 1996, 1995 and 1994 Morgan Stanley earned fees of $425,000,  $409,000 and
$383,000, respectively.

Other

         In  connection  with the  refinancings  of the  Company's  bank  credit
agreement  in 1995 and 1993,  the banks  thereunder  (including  Bankers  Trust)
received  certain fees  amounting to $17.2  million and $8.1 million in 1995 and
1993,  respectively.  In  connection  with a  recent  amendment  to  the  Credit
Agreement in May 1996, the banks thereunder  (including  Bankers Trust) received
certain fees amounting to $1.6 million.  In connection  with the Preferred Stock
Sale,  Morgan  Stanley,  which  acted  as  the  placement  agent  in  connection
therewith, received certain fees amounting to $1.8 million. Morgan Stanley acted
as one of the several  underwriters in connection with the Offering and received
fees of  approximately  $1.2  million in  connection  therewith.  See  "Security
Ownership of Certain Beneficial Owners and Management--Certain Beneficial Owners
of Holdings'  Capital  Stock" for a description of the ownership by MSLEF II, an
affiliate of Morgan Stanley, of certain securities of Holdings.

         Messrs. Silver and Horrigan, BTNY, MSLEF II and Holdings are parties to
the  Stockholders  Agreement,  which provides for certain rights and obligations
among them and between them and  Holdings.  See  "Security  Ownership of Certain
Beneficial Owners and Management--Description of Stockholders Agreements".

         In the event that the Company enters into any future  transactions with
any of its affiliates,  the Company expects to enter into any such  transactions
on terms no less favorable than those available from unaffiliated parties.


                                      -46-

<PAGE>



                                     PART IV

Item 14.  Exhibits, Financial Statements, Schedules, and Reports on Form 8-K.

(a)

Financial Statements:


Report of Independent Auditors...........................................  F-1

Consolidated Balance Sheets at December 31, 1996 and 1995................  F-2

Consolidated Statements of Operations for the years ended
       December 31, 1996, 1995 and 1994..................................  F-3

Consolidated Statements of Common Stockholder's Equity (Deficit) for
       the years ended December 31, 1996, 1995 and 1994..................  F-4

Consolidated Statements of Cash Flows for the years ended
       December 31, 1996, 1995 and 1994..................................  F-5

Notes to Consolidated Financial Statements...............................  F-7


Schedules:

I.     Condensed Financial Information of Silgan Corporation:
           Condensed Balance Sheets at December 31, 1996 and 1995........  F-31
           Condensed Statements of Operations for the years ended
              December 31, 1996, 1995 and 1994...........................  F-32
           Condensed Statements of Cash Flows for the years ended
              December 31, 1996, 1995 and 1994...........................  F-33

II.    Schedules of Valuation and Qualifying Accounts for the years
           ended December 31, 1996, 1995 and 1994........................  F-34


All other  financial  statements  and  schedules  not listed  have been  omitted
because  they are not  applicable,  or not  required,  or because  the  required
information  is  included  in the  consolidated  financial  statements  or notes
thereto.



                                      -47-

<PAGE>



Exhibits:

Exhibit
Number                                 Description
-------                                -----------

    3.1           Restated  Certificate of Incorporation  of Silgan,  as amended
                  (incorporated  by  reference  to  Exhibit  3.1 filed  with the
                  Company's  Annual  Report  on Form  10-K  for the  year  ended
                  December 31, 1993, Commission File No. 1-11200).

    3.2           By-laws of Silgan  (incorporated by reference to Exhibit 3(ii)
                  filed with the Company's  Registration  Statement on Form S-1,
                  dated January 11, 1988, Registration Statement No.
                  33-18719).

    3.3           Restated    Certificate   of    Incorporation    of   Holdings
                  (incorporated by reference to Exhibit 3.1 filed with Holdings'
                  Annual  Report on Form 10-K for the year  ended  December  31,
                  1996, Commission File No. 000-22117).

    3.4           Amended  and  Restated  By-laws of Holdings  (incorporated  by
                  reference to Exhibit 3.2 filed with Holdings' Annual Report on
                  Form 10-K for the year ended  December  31,  1996,  Commission
                  File No. 000-22117).

    4.1           Indenture dated as of June 29, 1992,  between Silgan and Fleet
                  National  Bank, as Trustee,  with respect to the 11-3/4% Notes
                  (incorporated  by reference  to Exhibit 1 filed with  Silgan's
                  Current  Report on Form 8-K dated  July 15,  1992,  Commission
                  File No. 33- 46499).

    4.2           Indenture,  dated as of June 29,  1992,  between  Holdings and
                  Fleet National Bank, as trustee,  with respect to the Discount
                  Debentures  (incorporated by reference to Exhibit 1 filed with
                  Holdings'  Current  Report  on Form 8-K dated  July 15,  1992,
                  Commission File No. 33-47632).

    4.3           Silgan Holdings Inc. Certificate of Designation of the Powers,
                  Preferences  and Relative,  Participating,  Optional and Other
                  Special Rights of 13-1/4% Cumulative  Exchangeable  Redeemable
                  Preferred   Stock   and   Qualifications,    Limitations   and
                  Restrictions  Thereof  (incorporated by reference to Exhibit 3
                  filed with  Holdings'  Current Report on Form 8-K dated August
                  2, 1996, Commission File No. 33-28409).

    4.4           Form of Silgan's  11-3/4% Senior  Subordinated  Notes due 2002
                  (incorporated by reference to Exhibit 4.5 filed with Holdings'
                  Annual  Report on Form 10-K for the year  ended  December  31,
                  1992, Commission File No. 33-28409).

    4.5           Form of Holdings' 13-1/4% Senior Discount  Debentures Due 2002
                  (incorporated by reference to Exhibit 4.4 filed with Holdings'
                  Annual  Report on Form 10-K for the year  ended  December  31,
                  1992, Commission File No. 33-28409).

    4.6           Registration  Rights Agreement,  dated July 22, 1996,  between
                  Holdings  and Morgan  Stanley  (incorporated  by  reference to
                  Exhibit  5 filed  with  Holdings'  Current  Report on Form 8-K
                  dated August 2, 1996, Commission File No. 33-28409).



                                      -48-

<PAGE>


Exhibit
Number                                 Description
-------                                -----------

    4.7           Form of Holdings' 13-1/4% Cumulative  Exchangeable  Redeemable
                  Preferred  Stock  Certificate  (incorporated  by  reference to
                  Amendment  No. 1 to Holdings'  Registration  Statement on Form
                  S-4, dated September 9, 1996, Commission File No. 333-9979).

    4.8           Indenture,  dated as of July 22,  1996,  between  Holdings and
                  Fleet National Bank, as Trustee,  with respect to the Exchange
                  Debentures  (incorporated  by  reference to Exhibit 4.10 filed
                  with Holdings'  Amendment No. 2 to  Registration  Statement on
                  Form S-4, dated October 31, 1996,  Registration  Statement No.
                  33-9979).

    4.9           Form   of   Holdings'   Subordinated   Debentures   due   2006
                  (incorporated   by   reference  to  Exhibit  4.11  filed  with
                  Holdings'  Amendment No. 2 to  Registration  Statement on Form
                  S-4,  dated  October  31,  1996,  Registration  Statement  No.
                  33-9979).

   10.1           Supply  Agreement  between  Containers and Nestle for Hanford,
                  California   effective   August  31,  1987   (incorporated  by
                  reference to Exhibit  10(xi) filed with Silgan's  Registration
                  Statement on Form S-1,  dated  January 11, 1988,  Registration
                  Statement No. 33-18719)  (Portions of this Exhibit are subject
                  to   confidential   treatment   pursuant   to   order  of  the
                  Commission).

   10.2           Amendment to Supply Agreement for Hanford,  California,  dated
                  July 1, 1990 (incorporated by reference to Exhibit 10.31 filed
                  with Silgan's Registration  Statement on Form S-1, dated March
                  18, 1992,  Registration  Statement No. 33-46499)  (Portions of
                  this Exhibit are subject to confidential treatment pursuant to
                  order of the Commission).

   10.3           Supply Agreement between  Containers and Nestle for Riverbank,
                  California   effective   August  31,  1987   (incorporated  by
                  reference to Exhibit 10(xii) filed with Silgan's  Registration
                  Statement on Form S-1,  dated  January 11, 1988,  Registration
                  Statement No. 33-18719)  (Portions of this Exhibit are subject
                  to   confidential   treatment   pursuant   to   order  of  the
                  Commission).

   10.4           Supply  Agreement  between  Containers  and Nestle for Morton,
                  Illinois, effective August 31, 1987 (incorporated by reference
                  to Exhibit 10(vii) filed with Silgan's Registration  Statement
                  on Form S-1,  dated January 11, 1988,  Registration  Statement
                  No.  33-18719)  (Portions  of  this  Exhibit  are  subject  to
                  confidential treatment pursuant to order of the Commission).

   10.5           Amendment to Supply Agreement for Morton, Illinois, dated July
                  1, 1990 (incorporated by reference to Exhibit 10.36 filed with
                  Silgan's  Registration  Statement on Form S-1, dated March 18,
                  1992,  Registration  Statement No. 33-46499) (Portions of this
                  Exhibit  are  subject to  confidential  treatment  pursuant to
                  order of the Commission).

   10.6           Supply Agreement between  Containers and Nestle for Ft. Dodge,
                  Iowa,  effective August 31, 1987 (incorporated by reference to
                  Exhibit 10(xiv) filed with Silgan's Registration  Statement on
                  Form S-1, dated January 11, 1988,  Registration  Statement No.
                  33-18719)   (Portions   of  this   Exhibit   are   subject  to
                  confidential treatment pursuant to order of the Commission).


                                      -49-

<PAGE>


Exhibit
Number                                 Description
-------                                ------------

   10.7           Amendment to Supply Agreement for Ft. Dodge, Iowa, dated March
                  1, 1990 (incorporated by reference to Exhibit 10.38 filed with
                  Silgan's  Registration  statement on Form S-1, dated March 18,
                  1992,  Registration  Statement No. 33-46499) (Portions of this
                  Exhibit  are  subject to  confidential  treatment  pursuant to
                  order of the Commission).

   10.8           Supply Agreement between Containers and Nestle for St. Joseph,
                  Missouri, effective August 31, 1987 (incorporated by reference
                  to Exhibit 10(xvii) filed with Silgan's Registration Statement
                  on Form S-1,  dated January 11, 1988,  Registration  Statement
                  No.  33-18719)  (Portions  of  this  Exhibit  are  subject  to
                  confidential treatment pursuant to order of the Commission).

   10.9           Amendment to Supply Agreement for St. Joseph,  Missouri, dated
                  March 1, 1990  (incorporated  by  reference  to Exhibit  10.42
                  filed with Silgan's Registration  Statement on Form S-1, dated
                  March 18, 1992, Registration Statement No. 33-46499) (Portions
                  of this Exhibit are subject to confidential treatment pursuant
                  to order of the Commission).

   10.10          Supply  Agreement  between  Containers and Nestle for Trenton,
                  Missouri, effective August 31, 1987 (incorporated by reference
                  to  Exhibit   10(xviii)   filed  with  Silgan's   Registration
                  Statement on Form S-1,  dated  January 11, 1988,  Registration
                  Statement No. 33-18719)  (Portions of this Exhibit are subject
                  to   confidential   treatment   pursuant   to   order  of  the
                  Commission).

   10.11          Amendment to Supply  Agreement  for Trenton,  Missouri,  dated
                  March 1, 1990  (incorporated  by  reference  to Exhibit  10.44
                  filed with Silgan's Registration  Statement on Form S-1, dated
                  March 18, 1992, Registration Statement No. 33-46499) (Portions
                  of this Exhibit are subject to confidential treatment pursuant
                  to order of the Commission).

   10.12          Supply Agreement between Containers and Nestle for Moses Lake,
                  Washington,   effective  August  31,  1987   (incorporated  by
                  reference to Exhibit 10(xxii) filed with Silgan's Registration
                  Statement on Form S-1,  dated  January 11, 1988,  Registration
                  Statement No. 33-18719)  (Portions of this Exhibit are subject
                  to   confidential   treatment   pursuant   to   order  of  the
                  Commission).

   10.13          Amendment  to Supply  Agreement  for Moses  Lake,  Washington,
                  dated  March 1, 1990  (incorporated  by  reference  to Exhibit
                  10.51 filed with Silgan's Registration  Statement on Form S-1,
                  dated March 18, 1992,  Registration  Statement  No.  33-46499)
                  (Portions  of  this   Exhibit  are  subject  to   confidential
                  treatment pursuant to order of the Commission).

   10.14          Supply Agreement between  Containers and Nestle for Jefferson,
                  Wisconsin,   effective   August  31,  1987   (incorporated  by
                  reference   to   Exhibit   10(xxiii)   filed   with   Silgan's
                  Registration  Statement on Form S-1,  dated  January 11, 1988,
                  Registration Statement No. 33-18719) (Portions of this Exhibit
                  are subject to confidential treatment pursuant to order of the
                  Commission).

   10.15          Amendment to Supply Agreement for Jefferson,  Wisconsin, dated
                  March 1, 1990  (incorporated  by  reference  to Exhibit  10.53
                  filed with Silgan's Registration Statement on


                                      -50-

<PAGE>


Exhibit
Number                                 Description
-------                                -----------

                  Form S-1,  dated March 18, 1992,  Registration  Statement  No.
                  33-46499)   (Portions   of  this   Exhibit   are   subject  to
                  confidential treatment pursuant to order of the Commission).

   10.16          Amendment to Supply  Agreements,  dated  November 17, 1989 for
                  Ft. Dodge, Iowa; Hillsboro, Oregon; Jefferson,  Wisconsin; St.
                  Joseph,  Missouri;  and  Trenton,  Missouri  (incorporated  by
                  reference to Exhibit 10.49 filed with  Silgan's  Annual Report
                  on Form 10-K for the year ended December 31, 1989,  Commission
                  File No.  33-18719)  (Portions  of this Exhibit are subject to
                  confidential treatment pursuant to order of the Commission).

  #10.17          Employment Agreement,  dated as of September 14, 1987, between
                  James Beam and Canaco Corporation  (Containers)  (incorporated
                  by   reference   to  Exhibit   10(vi)   filed  with   Silgan's
                  Registration  Statement on Form S-1,  dated  January 11, 1988,
                  Registration
                  Statement No. 33-18719).

  #10.18          Employment  Agreement,  dated as of September 1, 1989, between
                  Silgan,  InnoPak Plastics Corporation  (Plastics),  Russell F.
                  Gervais and Aim Packaging,  Inc. (incorporated by reference to
                  Exhibit 5 filed with Silgan's  Report on Form 8-K, dated March
                  15, 1989).

  #10.19          InnoPak  Plastics  Corporation  (Plastics)  Pension  Plan  for
                  Salaried Employees (incorporated by reference to Exhibit 10.32
                  filed with  Silgan's  Annual  Report on Form 10-K for the year
                  ended December 31, 1988, Commission File No. 33-18719).

  #10.20          Containers Pension Plan for Salaried  Employees  (incorporated
                  by  reference  to Exhibit  10.34  filed with  Silgan's  Annual
                  Report  on Form 10-K for the year  ended  December  31,  1988,
                  Commission File No. 33-18719).

  #10.21          Silgan  Holdings Inc.  Fourth  Amended and Restated 1989 Stock
                  Option Plan  (incorporated by reference to Exhibit 10.21 filed
                  with  Holdings'  Annual Report on Form 10-K for the year ended
                  December 31, 1996, Commission File No. 000-22117).

  #10.22          Form  of  Holdings   Nonstatutory   Stock   Option   Agreement
                  (incorporated   by  reference  to  Exhibit  10.22  filed  with
                  Holdings'  Annual  Report  on Form  10-K  for the  year  ended
                  December 31, 1996, Commission File No. 000-22117).

   10.23          Stockholders  Agreement,  dated as of December 21, 1993, among
                  R. Philip  Silver,  D. Greg  Horrigan,  MSLEF II, BTNY,  First
                  Plaza and  Holdings  (incorporated  by  reference to Exhibit 3
                  filed with  Holdings'  Current Report on Form 8-K, dated March
                  25, 1994, Commission File No. 33-28409).

  #10.24          Amended and Restated Management  Services Agreement,  dated as
                  of February 14, 1997,  between S&H and Holdings  (incorporated
                  by  reference  to Exhibit  10.24 filed with  Holdings'  Annual
                  Report  on Form 10-K for the year  ended  December  31,  1996,
                  Commission File No. 000-22117).



                                      -51-

<PAGE>


Exhibit
Number                                 Description
-------                                -----------

  #10.25          Amended and Restated Management  Services Agreement,  dated as
                  of February 14, 1997, between S&H and Silgan  (incorporated by
                  reference to Exhibit 10.25 filed with Holdings'  Annual Report
                  on Form 10-K for the year ended December 31, 1996,  Commission
                  File No. 000-22117).

  #10.26          Amended and Restated Management  Services Agreement,  dated as
                  of February 14, 1997, between S&H and Containers (incorporated
                  by  reference  to Exhibit  10.26 filed with  Holdings'  Annual
                  Report  on Form 10-K for the year  ended  December  31,  1996,
                  Commission File No. 000-22117).

  #10.27          Amended and Restated Management  Services Agreement,  dated as
                  of February 14, 1997,  between S&H and Plastics  (incorporated
                  by  reference  to Exhibit  10.27 filed with  Holdings'  Annual
                  Report  on Form 10-K for the year  ended  December  31,  1996,
                  Commission File No. 000-22117).

   10.28          Purchase  Agreement,  dated as of September  3, 1993,  between
                  Containers and Del Monte (incorporated by reference to Exhibit
                  1 filed  with  Holdings'  Current  Report on Form 8- K,  dated
                  January 5, 1994, Commission File No. 33-28409).

   10.29          Amendment  to Purchase  Agreement,  dated as of  December  10,
                  1993,  between  Containers  and  Del  Monte  (incorporated  by
                  reference to Exhibit 2 filed with Holdings'  Current Report on
                  Form  8-K,  dated  January  5,  1994,   Commission   File  No.
                  33-28409).

   10.30          Supply  Agreement,  dated as of  September  3,  1993,  between
                  Containers and Del Monte (incorporated by reference to Exhibit
                  10.118 filed with Silgan's  Annual Report on Form 10-K for the
                  year ended December 31, 1993,  Commission  File No.  1-11200).
                  (Portions  of this Exhibit are subject to an  application  for
                  confidential treatment filed with the Commission.)

   10.31          Amendment to Supply Agreement,  dated as of December 21, 1993,
                  between Containers and Del Monte (incorporated by reference to
                  Exhibit 10.119 filed with Silgan's  Annual Report on Form 10-K
                  for the year ended December 31, 1993,  Commission  File No. 1-
                  11200).   (Portions   of  this   Exhibit  are  subject  to  an
                  application   for   confidential   treatment  filed  with  the
                  Commission.)

   10.32          Credit  Agreement,  dated as of August 1, 1995,  among Silgan,
                  Containers,  Plastics,  the  lenders  from time to time  party
                  thereto,  Bankers  Trust,  as  Administrative  Agent  and as a
                  Co-Arranger,  and Bank of America  Illinois,  as Documentation
                  Agent  and  as a Co-Arranger  (incorporated  by  reference  to
                  Exhibit 2 filed  with  Holdings'  Current  Report on Form 8-K,
                  dated August 14, 1995, Commission File No. 33-28409).

   10.33          Amended and Restated Holdings Guaranty,  dated as of August 1,
                  1995, made by Holdings (incorporated by reference to Exhibit 4
                  filed with Holdings'  Current Report on Form 8-K, dated August
                  14, 1995, Commission File No. 33-28409).



                                      -52-

<PAGE>


Exhibit
Number                                 Description
-------                                -----------

   10.34          Amended and Restated Borrowers Guaranty, dated as of August 1,
                  1995,     made    by     Silgan,     Containers,     Plastics,
                  California-Washington Can Corporation and SCCW Can Corporation
                  (incorporated  by reference to Exhibit 3 filed with  Holdings'
                  Current Report on Form 8-K, dated August 14, 1995,  Commission
                  File No. 33-28409).

   10.35          Amended and Restated  Security  Agreement dated as of June 18,
                  1992,   among   Plastics,   Containers   and   Bankers   Trust
                  (incorporated  by reference  to Exhibit 8 filed with  Silgan's
                  Current  Report on Form 8-K dated  July 15,  1992,  Commission
                  File No. 33-46499).

   10.36          Amended and  Restated  Pledge  Agreement  dated as of June 18,
                  1992, made by Holdings (incorporated by reference to Exhibit 7
                  filed with Silgan's  Current Report on Form 8-K dated July 15,
                  1992, Commission File No. 33-46499).

   10.37          Amended and  Restated  Pledge  Agreement  dated as of June 18,
                  1992, made by Silgan  (incorporated  by reference to Exhibit 5
                  filed with Silgan's  Current Report on Form 8-K dated July 15,
                  1992, Commission File No. 33-46499).

   10.38          Amended and  Restated  Pledge  Agreement  dated as of June 18,
                  1992,  made  by  Containers  and  Plastics   (incorporated  by
                  reference to Exhibit 6 filed with Silgan's  Current  Report on
                  Form 8-K dated July 15, 1992, Commission File No. 33-46499).

   10.39          Asset Purchase  Agreement,  dated as of June 2, 1995,  between
                  ANC and  Containers  (incorporated  by  reference to Exhibit 1
                  filed with Holdings' Current Report on Form 8- K, dated August
                  14, 1995, Commission File No. 33-28409).

   10.40          Underwriting  Agreement,  dated as of February 13, 1997, among
                  Holdings, Silgan, Containers, Plastics, MSLEF II, BTNY and the
                  underwriters  listed on  Schedule I thereto  (incorporated  by
                  reference to Exhibit 10.40 filed with Holdings'  Annual Report
                  on Form 10-K for the year ended December 31, 1996,  Commission
                  File No. 000-22117).

   10.41          Placement Agreement between Holdings and Morgan Stanley, dated
                  July 17, 1996  (incorporated  by  reference to Exhibit 6 filed
                  with  Holdings'  Current  Report on Form 8-K  dated  August 2,
                  1996, Commission File No. 33-28409).

   10.42          Amendment to Stockholders Agreement,  dated as of February 14,
                  1997, among R. Philip Silver, D. Greg Horrigan, MSLEF II, BTNY
                  and Holdings (incorporated by reference to Exhibit 10.42 filed
                  with  Holdings'  Annual Report on Form 10-K for the year ended
                  December 31, 1996, Commission File No. 000-22117).

   21             Subsidiaries of the Registrant  (incorporated  by reference to
                  Exhibit 21 filed with Silgan's  Annual Report on Form 10-K for
                  the  year  ended  December  31,  1995,   Commission  File  No.
                  1-11200).

  *27             Financial Data Schedule.



                                      -53-

<PAGE>



(b)  Reports on Form 8-K:

         No reports on Form 8-K were filed during the fourth quarter of 1996.


--------------------
*        Filed herewith
#        Indicates a management contract or compensatory plan or arrangement in
         accordance with Section (a)3. of Item 14 of Form 10-K.




                                      -54-

<PAGE>



                                   SIGNATURES


                  Pursuant  to the  requirements  of  Section 13 or 15(d) of the
Securities  Exchange Act of 1934,  the Registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.

                                       SILGAN CORPORATION



Date:  March 27, 1997                  By   /s/ R. Philip Silver
                                            _________________________
                                            R. Philip Silver
                                            Chairman of the Board and Co-Chief
                                            Executive Officer


                  Pursuant to the requirements of the Securities Exchange Act of
1934,  this report has been signed below by the  following  persons on behalf of
the Registrant and in the capacities and on the dates indicated.


Signature                             Title                           Date
---------                             -----                           ----


                              Chairman of the Board and
/s/ R. Philip Silver          Co-Chief Executive Officer
________________________     (Principal Executive Officer)        March 27, 1997
(R. Philip Silver)



/s/ D. Greg Horrigan          President, Co-Chief Executive
________________________           Officer and Director           March 27, 1997
(D. Greg Horrigan)



/s/ Robert H. Niehaus
________________________              Director                    March 27, 1997
(Robert H. Niehaus)



/s/ Leigh J. Abramson
________________________              Director                    March 27, 1997
(Leigh J. Abramson)



                              Executive Vice President, Chief
/s/ Harley Rankin, Jr.        Financial Officer and Treasurer
________________________       (Principal Financial Officer)      March 27, 1997
(Harley Rankin, Jr.)



                               Vice President, Controller and
/s/ Harold J. Rodriguez, Jr.        Assistant Treasurer
________________________       (Principal Accounting Officer)     March 27, 1997
(Harold J. Rodriguez, Jr.)



                                      -55-

<PAGE>

                         REPORT OF INDEPENDENT AUDITORS


The Board of Directors and Stockholder
Silgan Corporation


     We have  audited the  accompanying  consolidated  balance  sheets of Silgan
Corporation  as of  December  31, 1996 and 1995,  and the  related  consolidated
statements of operations,  common  stockholder's equity (deficit) and cash flows
for each of the three years in the period ended  December  31, 1996.  Our audits
also  included the  financial  statement  schedules  listed in the index at Item
14(a) of the Company's  Annual  Report on Form 10-K for the year ended  December
31, 1996. These financial statements and schedules are the responsibility of the
Company's  management.  Our  responsibility  is to  express  an opinion on these
financial statements based on our audits.

     We conducted  our audits in accordance  with  generally  accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

     In our opinion,  the consolidated  financial  statements  referred to above
present fairly, in all material respects, the consolidated financial position of
Silgan  Corporation at December 31, 1996 and 1995, and the consolidated  results
of its  operations  and its cash flows for each of the three years in the period
ended  December 31, 1996,  in  conformity  with  generally  accepted  accounting
principles.  Also, in our opinion,  the related financial  statement  schedules,
when considered in relation to the basic financial  statements taken as a whole,
present fairly in all material respects the information set forth therein.



                                             /s/ Ernst & Young LLP
Stamford,  Connecticut 
January 31, 1997, except for Note 21,
as to which date is February 20, 1997
 





                                      F-1
<PAGE>




                               SILGAN CORPORATION
                           CONSOLIDATED BALANCE SHEETS
                           December 31, 1996 and 1995
                             (Dollars in thousands)

                                                          1996          1995
                                                          ----          ----
Assets
Current assets:
  Cash and cash equivalents ........................    $    947     $  2,092
  Accounts receivable, less allowances for
   doubtful accounts of $4,045 and $4,843 for
   1996 and 1995, respectively .....................     101,436      109,929
  Inventories ......................................     195,981      210,471
  Prepaid expenses and other current assets ........       7,329        5,731
                                                        --------     --------
      Total current assets .........................     305,693      328,223

Property, plant and equipment, net .................     499,781      487,301
Goodwill, net ......................................      57,885       43,562
Other assets .......................................      37,010       29,637
                                                        --------     --------
                                                        $900,369     $888,723
                                                        ========     ========
Liabilities and Stockholders' Equity (Deficit)
Current liabilities:
  Trade accounts payable ...........................    $122,623     $138,195
  Accrued payroll and related costs ................      41,649       32,805
  Accrued interest payable .........................       9,175        4,358
  Accrued expenses and other current liabilities ...      34,614       43,062
  Bank working capital loans .......................      27,800        7,100
  Current portion of long-term debt ................      38,427       28,140
                                                        --------     --------
      Total current liabilities ....................     274,288      253,660

Long-term debt .....................................     634,843      549,610
Deferred income taxes ..............................        --          3,017
Other long-term liabilities ........................      75,997       69,576

Stockholder's Equity:
  Common stock ($0.01 par value per share;
    3,000 shares authorized, 2 shares issued) ......        --           --
  Additional paid-in capital .......................      91,235       73,635
  Accumulated Deficit ..............................    (175,994)     (60,775)
                                                        --------     --------
      Total stockholder's equity (deficit) .........     (84,759)      12,860
                                                        --------     --------
                                                        $900,369     $888,723
                                                        ========     ========

                             See accompanying notes.




                                      F-2
<PAGE>





                               SILGAN CORPORATION
                      CONSOLIDATED STATEMENTS OF OPERATIONS
              For the years ended December 31, 1996, 1995 and 1994
                             (Dollars in thousands)

                                                  1996        1995       1994
                                                  ----        ----       ----

Net sales ..................................   $1,405,742  $1,101,905  $861,374

Cost of goods sold .........................    1,222,976     970,491   748,290
                                               ----------  ----------  --------

     Gross profit ..........................      182,766     131,414   113,084

Selling, general and administrative expenses       58,056      45,734    37,160

Reduction in carrying value of assets ......         --        14,745    16,729
                                               ----------  ----------  --------

     Income from operations ................      124,710      70,935    59,195

Interest expense and other related
  financing costs ..........................       71,491      52,462    36,142
                                               ----------  ----------  --------

     Income before income taxes ............       53,219      18,473    23,053

Income tax provision .......................       20,900       8,700    11,000
                                               ----------  ----------  --------

     Income before extraordinary charges ...       32,319       9,773    12,053

Extraordinary charges relating to early
  extinguishment of debt, net of taxes .....         --        (2,967)     --
                                               ----------  ----------  --------

     Net income ............................   $   32,319  $    6,806  $ 12,053
                                               ==========  ==========  ========











                             See accompanying notes.




                                      F-3
<PAGE>





                               SILGAN CORPORATION
            CONSOLIDATED STATEMENTS OF STOCKHOLDER'S EQUITY (DEFICIT)
              For the years ended December 31, 1996, 1995 and 1994
                             (Dollars in thousands)

                                                                       Total
                                             Additional    Accum-  stockholder's
                                     Common    paid-in     ulated      equity
                                      stock    capital     Deficit    (deficit)
                                      -----    -------     -------    ---------
                                                                      
Balance at December 31, 1993 ......   $ --     $64,135   $ (11,332)   $  52,803

Tax benefit realized from Parent ..     --       5,400        --          5,400

Payments to former shareholders ...     --        --        (6,911)      (6,911)

Net income ........................     --        --        12,053       12,053
                                      ------   -------   ---------    ---------

Balance at December 31, 1994 ......     --      69,535      (6,190)      63,345

Tax benefit realized from Parent ..     --       4,100        --          4,100

Distribution to Parent ............     --        --       (57,596)     (57,596)

Payments to former shareholders ...     --        --        (3,795)      (3,795)

Net income ........................     --        --         6,806        6,806
                                      ------   -------   ---------    ---------

Balance at December 31, 1995 ......     --      73,635     (60,775)      12,860

Tax benefit realized from Parent ..     --      17,600        --         17,600

Distribution to Parent ............     --        --      (147,538)    (147,538)

Net income ........................     --        --        32,319       32,319
                                      ------   -------   ---------    ---------

Balance at December 31, 1996 ......   $ --     $91,235   $(175,994)   $ (84,759)
                                      ======   =======   =========    =========







                             See accompanying notes.




                                      F-4
<PAGE>




                               SILGAN CORPORATION
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
              For the years ended December 31, 1996, 1995 and 1994
                             (Dollars in thousands)


                                                   1996        1995        1994
                                                   ----        ----        ----

Cash flows from operating activities:
   Net income ................................  $ 32,319   $   6,806   $ 12,053
   Adjustments to reconcile net income
     to net cash provided by operating
     activities:
       Depreciation ..........................    54,830      42,217     35,392
       Amortization ..........................     7,848       7,488      6,404
       Reduction in carrying value of assets .      --        14,745     16,729
       Contribution by Parent for federal
         income tax provision ................    17,600       4,100      5,400
       Extraordinary charge relating to early
         extinguishment of debt ..............      --         4,943       --
       Changes in assets and liabilities, net
         of effect of acquisitions:
            Decrease (increase) in accounts
               receivable ....................    15,102      (1,011)   (21,267)
            Decrease (increase) in inventories    20,348      10,852    (16,741)
            (Decrease) increase in trade
               accounts payable ..............   (17,145)     43,108      4,478
            Net working capital provided by AN
              Can from 8/1/95 to 12/31/95 ....      --        85,213       --
            Other, net (decrease) increase ...      (836)     (8,825)     4,887
                                                --------   ---------   --------
                Total adjustments ............    97,747     202,830     35,282
                                                --------   ---------   --------
       Net cash provided by operating
         activities ..........................   130,066     209,636     47,335
                                                --------   ---------   --------

Cash flows from investing activities:
   Acquisition of businesses .................   (43,043)   (348,762)       519
   Capital expenditures ......................   (56,851)    (51,897)   (29,184)
   Proceeds from sale of assets ..............     1,557       3,541        765
                                                --------   ---------   --------
       Net cash used in investing activities .  $(98,337)  $(397,118)  $(27,900)
                                                --------   ---------   --------



                        Continued on following page.




                                      F-5
<PAGE>




                               SILGAN CORPORATION
                CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
              For the years ended December 31, 1996, 1995 and 1994
                             (Dollars in thousands)


                                                  1996        1995        1994
                                                  ----        ----        ----

Cash flows from financing activities:
   Borrowings under working capital loans ..   $952,050    $669,260    $393,250
   Repayments under working capital loans ..   (931,350)   (674,760)   (382,850)
   Proceeds from issuance of long-term debt     125,000     450,000        --
   Repayments of long-term debt ............    (29,480)   (176,910)    (20,464)
   Distribution to Parent ..................   (147,538)    (57,596)       --
   Debt financing costs ....................     (1,556)    (19,290)       --
   Payments to former shareholders .........       --        (3,795)     (6,911)
                                               --------    --------    --------
       Net cash (used) provided by financing
         activities ........................    (32,874)    186,909     (16,975)
                                               --------    --------    --------

Net (decrease) increase in cash and
  cash equivalents .........................     (1,145)       (573)      2,460

Cash and cash equivalents at
  beginning of year ........................      2,092       2,665         205
                                               --------    --------    --------

Cash and cash equivalents at
  end of year ..............................   $    947    $  2,092    $  2,665
                                               ========    ========    ========


Supplementary data:
     Interest paid .........................   $ 63,251    $ 45,293    $ 30,718
     Income tax (refunds) payments, net ....     (4,836)      8,967       2,588








                             See accompanying notes.




                                      F-6
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


1.  Basis of Presentation

Silgan Corporation  ("Silgan" or the "Company"),  a corporation which was formed
in  1987  to  acquire  interests  in  various  packaging  manufacturers,   is  a
wholly-owned  subsidiary of Silgan  Holdings Inc.  ("Holdings" or the "Parent").
The Parent is a company  controlled by Silgan  management and The Morgan Stanley
Leveraged  Equity Fund II, L. P. ("MSLEF II"), an affiliate of Morgan  Stanley &
Co., Incorporated ("MS & Co.").

The  Company,  together  with its  wholly-owned  operating  subsidiaries  Silgan
Containers   Corporation   ("Containers")   and  Silgan   Plastics   Corporation
("Plastics"),  is predominantly engaged in the manufacture and sale of steel and
aluminum  containers  for  human  and  pet  food  products.   The  Company  also
manufactures  custom  designed  plastic  containers used for health and personal
care products,  specialty packaging items including metal caps and closures, and
plastic bowls and paper  containers  used by  processors  in the food  industry.
Principally,  all of the Company's  businesses  are based in the United  States.
Foreign  subsidiaries  are  not  significant  to  the  consolidated  results  of
operations or financial position of the Company.


2.  Summary of Significant Accounting Policies

Consolidation

The consolidated  financial  statements  include the accounts of the Company and
its subsidiaries,  all of which are wholly-owned.  All significant  intercompany
transactions  have been  eliminated.  Assets and  liabilities  of the  Company's
foreign  subsidiary are translated at rates of exchange in effect at the balance
sheet date.  Income  statement  amounts are translated at the average of monthly
exchange rates.

Cash and cash equivalents

Cash equivalents represent short-term, highly liquid investments having original
maturities  of three  months or less  from the time of  purchase.  The  carrying
values  of these  assets  approximate  their  fair  values.  As a result  of the
Company's cash management  system,  checks issued and presented to the banks for
payment may create  negative  cash  balances.  Checks  outstanding  in excess of
related cash balances totaling  approximately $49.6 million at December 31, 1996
and $30.0 million at December 31, 1995 are included in trade accounts payable.





                                      F-7
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


2.  Summary of Significant Accounting Policies  (continued)

Inventories

Inventories are stated at the lower of cost or market (net realizable value) and
are principally accounted for by the last-in, first-out method (LIFO).

Property, Plant and Equipment

Property,  plant and equipment are stated at  historical  cost less  accumulated
depreciation.  Major renewals and  betterments  that extend the life of an asset
are capitalized and repairs and maintenance  expenditures are charged to expense
as incurred.  Depreciation is computed using the straight-line method over their
estimated  useful lives.  The principal  estimated useful lives are 35 years for
buildings and range between 3 to 18 years for machinery and equipment. Leasehold
improvements  are amortized over the shorter of the life of the related asset or
the life of the lease.

Goodwill

The Company has  classified  as goodwill the cost in excess of fair value of net
assets  acquired  in  purchase  transactions.  Goodwill  is  stated at cost less
accumulated amortization. Amortization is computed on a straight-line basis over
periods  ranging from 20 to 40 years.  The Company  periodically  evaluates  the
existence of goodwill impairment to access whether goodwill is fully recoverable
from  projected,  undiscounted  net cash  flows of the  related  business  unit.
Impairments would be recognized in operating results if a permanent reduction in
values were to occur.

Long-Lived Assets

Effective January 1, 1996, the Company adopted Statement of Financial Accounting
Standard  ("SFAS") No. 121,  "Accounting for the Impairment of Long-Lived Assets
and for  Long-Lived  Assets to Be Disposed Of".  Under SFAS No. 121,  impairment
losses will be recognized when events or changes in circumstances  indicate that
the  undiscounted  cash flows generated by the assets are less than the carrying
value of such assets.  Impairment losses are then measured by comparing the fair
value of  assets to their  carrying  amount.  There  were no  impairment  losses
recognized during 1996.

Other Assets

Other  assets  consist  principally  of debt  issuance  costs  which  are  being
amortized on a straight-line basis over the terms of the related debt agreements
(5 to 10 years).  Other  intangible  assets are  amortized  over their  expected
useful lives using the straight-line method.




                                      F-8
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


2.  Summary of Significant Accounting Policies  (continued)

Income Taxes

The Company  accounts for income taxes using the liability  method in accordance
with SFAS No. 109, "Accounting for Income Taxes". The provision for income taxes
includes  federal,  state, and foreign income taxes currently  payable and those
deferred because of temporary  differences  between the financial  statement and
tax bases of assets and liabilities. As provided under SFAS No. 109, the Company
recognizes a deferred tax benefit from the losses of Holdings which is reflected
as a contribution to additional paid-in capital.

Stock Based Compensation

SFAS No. 123,  "Accounting for Stock-Based  Compensation"  was issued in October
1995,  effective  for the 1996 fiscal  year.  Under SFAS No.  123,  compensation
expense for all stock-based  compensation plans would be recognized based on the
fair value of the options at the date of grant using an option pricing model. As
permitted under SFAS No. 123, the Company may either adopt the new pronouncement
or may continue to follow the accounting  method as prescribed under APB No. 25,
"Accounting  for Stock Issued to Employees".  The Company has chosen to continue
to recognize compensation expense in accordance with APB No. 25.

Derivative Financial Instruments

The  Company's use of derivative  financial  instruments  is limited to interest
rate swap agreements  which assist in managing  exposure to adverse  movement in
interest  rates on a portion of its  indebtedness.  The Company does not utilize
financial instruments for speculative  purposes.  The difference between amounts
to be paid or  received  on  interest  rate  swap  agreements  are  recorded  as
adjustments to interest  expense.  The methods and assumptions  used to estimate
fair  values of these and other  debt  instruments  reflected  in the  financial
statements are discussed in Note 10.

Use of Estimates

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities, revenues and expenses, as
well as footnote  disclosures  in the financial  statements.  Actual results may
differ from those estimates.





                                      F-9
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


3.  Acquisitions

On October 9, 1996,  the  Company  acquired  substantially  all of the assets of
Finger Lakes Packaging  Company,  Inc. ("Finger Lakes"),  a metal food container
manufacturer,  which had net sales of $48.8 for its  fiscal  year ended June 29,
1996.  The purchase price was $29.9 million  (including  net working  capital of
$8.0 million) and was primarily allocated to property, plant, and equipment, and
net  working  capital  acquired  based  on fair  market  value as of the date of
acquisition.  The  excess of the  purchase  price over the fair value of the net
assets  acquired  was $5.2 million and has been  recorded as goodwill,  which is
being amortized on a straight-line basis over 20 years.

On August 1, 1995,  Containers  acquired  from  American  National  Can  Company
("ANC")  substantially all of the fixed assets and working capital,  and assumed
certain specified limited liabilities,  of ANC's Food Metal & Specialty business
("AN Can"),  which  manufactures,  markets and sells metal food  containers  and
rigid  plastic  containers  for a variety  of food  products  and metal caps and
closures for food and beverage products. The final purchase price for the assets
acquired and the assumption of certain specified  liabilities was $362.0 million
(including  $13.1 million paid in 1996).  The aggregate  purchase price has been
allocated to the assets  acquired and  liabilities  assumed  based on their fair
values.  The purchase  price  allocation  was  adjusted in 1996 for  differences
between the actual and preliminary  valuations for the asset  appraisals and for
projected employee benefit costs as well as for a revision in estimated costs of
plant  rationalizations,   administrative  workforce  reductions,   the  related
recognition of a deferred tax asset, and various other acquisition  liabilities.
The final  purchase  price  allocation  resulted  in an  adjustment  to increase
goodwill by $10.7 million.  The aggregate  excess of the purchase price over the
fair value of the assets acquired and  liabilities  assumed for AN Can was $25.6
million  and has been  recorded  as  goodwill,  which is  being  amortized  on a
straight-line basis over 40 years.

The Finger Lakes and AN Can  acquisitions  were accounted for using the purchase
method of accounting and accordingly, the results of operations for Finger Lakes
and AN Can have been included in the  consolidated  financial  statements of the
Company from the dates of acquisition.

Set forth  below are the  Company's  summary  unaudited  pro  forma  results  of
operations  for  the  year  ended  December  31,  1995,  giving  effect  to  the
acquisition  of AN Can. The summary  unaudited  pro forma  results of operations
include the historical  results of the Company and AN Can and reflect the effect
of purchase  accounting  adjustments  based on appraisals  and  valuations,  the
financing of the  acquisition of AN Can by the Company,  the  refinancing of the
Company's  related debt  obligations,  and certain other adjustments as if these
events occurred as of the beginning of 1995. Pro forma results of operations for
Finger  Lakes have not been  presented  for 1996 or included in the 1995 summary
unaudited pro forma results of operations  since the impact of such  acquisition
was not significant.




                                      F-10
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


3.  Acquisitions  (continued)

The pro forma  results  of  operations  do not give  effect to  adjustments  for
decreased costs from manufacturing  synergies  resulting from the integration of
AN Can with the Company's existing can manufacturing operations and benefits the
Company  may  realize  as a  result  of its  planned  rationalization  of  plant
operations.  The pro forma  information  does not purport to represent  what the
Company's results of operations  actually would have been if the operations were
combined  as of  January  1,  1995,  or to  project  the  Company's  results  of
operations for any future period:

                                                    1995
                                                    ----
                                            (Dollars in thousands)
                                            
             Net sales .....................   $ 1,404,382
             Income from operations ........        94,008(1)
             Income before income taxes.....        27,666
             Net income ....................        15,266
            
    
(1)   Included  in pro  forma  income  from  operations  for the  year  ended
      December  31, 1995 is a charge of $14.7  million to adjust the carrying
      value of  certain  underutilized  machinery  and  equipment  at  Silgan
      facilities (existing prior to the AN Can acquisition) to net realizable
      value.


4.  Inventories

The  components  of  inventories  at December  31, 1996 and 1995  consist of the
following:

                                                     1996        1995 
                                                     ----        ---- 
                                                  (Dollars in thousands)

      Raw materials ...........................   $ 40,280    $ 46,027
      Work-in-process .........................     27,861      24,869
      Finished goods ..........................    116,498     135,590
      Spare parts and other ...................      7,771       6,344
                                                  --------    --------
                                                   192,410     212,830
      Adjustment to value inventory
         at cost on the LIFO method............      3,571      (2,359)
                                                  --------    --------
                                                  $195,981    $210,471
                                                  ========    ========

The amount of inventory  recorded on the first-in  first-out  method at December
31, 1996 and 1995 was $19.8 million and $17.6 million, respectively.





                                      F-11
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


5.  Property, Plant and Equipment

Property,  plant and  equipment  at December  31,  1996 and 1995  consist of the
following:
                                                     1996        1995
                                                     ----        ----
                                                  (Dollars in thousands)

      Land ....................................   $  6,425    $  6,355
      Buildings and improvements ..............     79,923      68,860
      Machinery and equipment .................    621,232     584,526
      Construction in progress ................     49,771      33,764
                                                  --------    --------
                                                   757,351     693,505
      Accumulated depreciation and amortization   (257,570)   (206,204)
                                                  --------    --------
            Property, plant and equipment, net    $499,781    $487,301
                                                  ========    ========
 
For the years ended December 31, 1996, 1995, and 1994,  depreciation expense was
$54.8 million, $42.2 million and $35.4 million,  respectively.  The total amount
of repairs and maintenance  expense was $32.0 million in 1996,  $26.9 million in
1995 and $19.9 million in 1994.

In 1995  and  1994,  based  on a  review  of  depreciable  assets,  the  Company
determined that certain adjustments were necessary to properly reflect net fixed
asset  realizable  values.  In 1995, the Company  recorded a write-down of $14.7
million  for the excess of carrying  value over  estimated  realizable  value of
machinery and equipment at existing  facilities  which had become  underutilized
due to excess  capacity.  In 1994,  charges of $16.7 million were recorded which
included $2.6 million to write-down  the excess  carrying  value over  estimated
realizable value of various plant facilities held for sale and $14.1 million for
technologically obsolete and inoperable machinery and equipment.


6.  Goodwill

Goodwill  amortization  charged to  operations  was $2.0  million in 1996;  $1.3
million in 1995; and $1.2 million in 1994. Accumulated  amortization of goodwill
at December 31, 1996,  1995, and 1994 was $7.0 million;  $5.0 million;  and $3.7
million, respectively.





                                      F-12
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


7.  Other Assets

Other assets at December 31, 1996 and 1995 consist of the following:

                                                  1996       1995
                                                  ----       ----
                                               (Dollars in thousands)

            Debt issuance costs ...........     $26,577    $25,021
            Deferred tax asset ............       6,983       --
            Other .........................      11,010     10,202
                                                -------    -------
                                                 44,570     35,223
            Less:  accumulated amortization      (7,560)    (5,586)
                                                -------    -------
                                                $37,010    $29,637
                                                =======    =======

During 1996, the Company  capitalized $1.6 million of new debt issuance costs in
connection  with  borrowings  used to fund the  refinancing of Holdings' 13 1/4%
Senior  Discount  Debentures due 2002  ("Discount  Debentures").  As part of the
acquisition of AN Can and the related refinancing of its secured debt facilities
in 1995, the Company wrote off $4.9 million of  unamortized  debt issuance costs
and capitalized $19.3 million of new debt issuance costs.  Amortization  expense
relating to debt issuance for the years ended December 31, 1996,  1995, and 1994
was $4.0 million, $4.3 million, and $4.6 million, respectively.


8.  Short-Term Borrowings and Long-Term Debt

The  Company  has a  revolving  credit  facility  which it uses to  finance  its
seasonal  liquidity  needs.  As of December  31, 1996 and 1995,  the Company had
$27.8 million and $7.1 million,  respectively,  of loans  outstanding  under the
revolving credit facility ("Working Capital Loans").

Long-term debt consists of the following:
                                                  1996       1995
                                                  ----       ----
                                              (Dollars in thousands)

     Bank A Term Loans .....................   $194,554   $220,000
     Bank B Term Loans .....................    343,716    222,750
     11 3/4% Senior Subordinated Notes due
        June 15, 2002 ......................    135,000    135,000
                                               --------   --------
                                                673,270    577,750
     Less: Amounts due within one year .....     38,427     28,140
                                               --------   --------
                                               $634,843   $549,610
                                               ========   ========





                                      F-13
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


8.  Short-Term Borrowings and Long-Term Debt  (continued)

The aggregate  annual  maturities of long-term  debt at December 31, 1996 are as
follows (in thousands):

                           1997..................    $ 38,427
                           1998..................      53,393
                           1999..................      53,393
                           2000..................     126,112
                           2001..................     155,880
                           2002 and thereafter...     246,065
                                                     --------
                                                     $673,270
                                                     ========
       
Refinancings

Effective  August 1, 1995, the Company,  Containers and Plastics  entered into a
$675.0 million credit  agreement (the "Credit  Agreement") with various banks to
finance the  acquisition by Containers of AN Can, to refinance and repay in full
all amounts  owing under the previous  bank credit  agreement  and the Company's
Senior  Secured  Notes (the  "Secured  Notes"),  and to make a  distribution  to
Holdings  in an amount  not to exceed  $75.0  million  for the  repurchase  of a
portion of Holding's Discount Debentures.

The Credit Agreement, as entered into during 1995, provided the Company with (i)
$225.0  million of A Term Loans,  (ii) $225.0  million of B Term Loans and (iii)
Working  Capital Loans of up to $225.0  million.  The Company used proceeds from
the Credit  Agreement  to acquire AN Can for  $348.9  million  (excluding  $13.1
million  paid in 1996),  repay  $117.1  million of term loans under the previous
credit agreement,  repay in full $50.0 million of the Secured Notes,  distribute
$57.6 million to Holdings,  and incur debt issuance costs of $19.3 million. As a
result of the early  redemption of the Secured  Notes,  the Company  incurred an
extraordinary  charge  of $3.0  million,  net of  taxes,  for the  write-off  of
unamortized  deferred  financing  costs of $4.9 million and premiums paid on the
redemption of the Secured Notes of $0.2 million.

In 1996, the Credit Agreement was amended to provide the Company with additional
B Term Loans of $125.0  million.  During 1996,  the  additional B term loans and
$17.4 million of Working  Capital Loans were  distributed  to Holdings to enable
Holdings to redeem a portion of its Discount Debentures.





                                      F-14
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


8.  Short-Term Borrowings and Long-Term Debt  (continued)

Bank Credit Agreement

The A Term Loans  mature on December  31,  2000,  and the B Term Loans mature on
March 15, 2002.  Principal repayments of $25.4 million and $5.0 million on the A
Term Loans and $4.0  million  and $2.3  million on the B Term Loans were made in
1996 and 1995,  respectively.  Principal  is to be repaid on each of the A and B
Term  Loans in  installments  in  accordance  with the  Credit  Agreement  until
maturity.

As provided in the Credit  Agreement,  the Company is required to repay the term
loans  (ratably  allocated  between the A Term Loans and the B Term Loans) in an
amount equal to 80% of the net sale  proceeds from certain asset sales and up to
100% of the net equity proceeds from certain sales of equity.  Effective for the
year ended  December  31, 1996 and each year  thereafter  during the term of the
Credit  Agreement,  the Company is  required  to prepay the term loans  (ratably
allocated  between the A Term Loans and the B Term Loans) in an amount  equal to
50% of the  Company's  excess  cash flow.  Amounts  repaid  under the term loans
cannot be reborrowed.

The Credit Agreement  provides  Containers and Plastics,  together,  a revolving
credit  facility of up to $225.0 million for working  capital needs.  Borrowings
available  under the revolving  credit  facility were $190.0 million at December
31, 1996, after taking into account  outstanding  Working Capital Loans of $27.8
million  and  outstanding  letters of credit of $7.2  million.  The  Company may
utilize  up to a maximum  of $20.0  million  in letters of credit as long as the
aggregate amount of borrowings of Working Capital Loans and letters of credit do
not exceed the amount of the commitment under the revolving credit facility. The
aggregate  amount of Working  Capital  Loans and letters of credit  which may be
outstanding  at any time is also  limited to the  aggregate  of 85% of  eligible
accounts receivable and 50% of eligible inventory.  Working Capital Loans may be
borrowed,  repaid,  and reborrowed  over the life of the Credit  Agreement until
final maturity on December 31, 2000.

The  borrowings  under the Credit  Agreement may be designated by the respective
borrowers  as Base  Rate or  Eurodollar  Rate  borrowings.  The Base Rate is the
higher of (i) 1/2 of 1% in excess of Adjusted  Certificate  of Deposit  Rate, or
(ii) Bankers  Trust  Company's  prime lending rate.  Base Rate  borrowings  bear
interest at the Base Rate plus a margin of 1.50% in the case of A Term Loans and
Working  Capital  Loans;  and a  margin  of  2.0% in the  case of B Term  Loans.
Eurodollar Rate borrowings bear interest at the Eurodollar Rate plus a margin of
2.50% in the case of A Term Loans and  Working  Capital  Loans;  and a margin of
3.0% in the case of B Term Loans.




                                      F-15
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


8.  Short-Term Borrowings and Long-Term Debt  (continued)

Bank Credit Agreement  (continued)

In accordance with the Credit Agreement,  if the Company meets certain financial
tests,  the interest rate margin on Base Rate and Eurodollar Rate borrowings may
be reduced from the existing margin.  As of December 31, 1996, the interest rate
for Base Rate  borrowings  was 9.75% and the interest rate for  Eurodollar  Rate
borrowings ranged between 8.0% and 8.63%.  During 1996, the Company entered into
interest rate swap  arrangements to convert interest rate exposure from variable
to fixed  rates of  interest  on A Term Loans and B Term  Loans in an  aggregate
amount of $200.0 million (for a discussion of the interest rate swap agreements,
see Note 9).

For 1996,  1995 and 1994,  respectively,  the average  amount of  borrowings  of
Working Capital Loans was $104.1 million,  $67.6 million and $14.4 million;  the
weighted  average annual interest rate paid on such  borrowings was 8.4%,  8.9%,
and 8.4%; and the highest amount of such borrowings was $175.1  million,  $188.1
million, and $46.0 million.

The Credit  Agreement  provides for the payment of a commitment  fee of 0.5% per
annum on the daily average  unused portion of  commitments  available  under the
working  capital  revolving  credit facility as well as a 2.75% per annum fee on
outstanding letters of credit.

The  indebtedness  under the Credit Agreement is guaranteed by Holdings and each
of Silgan,  Containers  and  Plastics  and  secured by a  security  interest  in
substantially  all of the real and personal  property of Silgan,  Containers and
Plastics.  The  stock of the  Company  and the stock of  principally  all of its
subsidiaries have been pledged to the lenders under the Credit Agreement.

The Credit Agreement  contains various covenants which limit or restrict,  among
other things,  investments,  indebtedness,  liens,  dividends,  leases,  capital
expenditures, and the use of proceeds from asset sales, as well as requiring the
Company to meet certain specified financial covenants.  The Company is currently
in compliance with all covenants under the Credit Agreement.

11 3/4% Senior Subordinated Notes

The Company's 11 3/4% Senior  Subordinated  Notes (the "11 3/4%  Notes"),  which
mature on June 15, 2002, represent unsecured general obligations of the Company,
subordinate  in right of payment to obligations  under the Credit  Agreement and
effectively  subordinate to all of the  obligations of the  subsidiaries  of the
Company. Interest is payable semi-annually on June 15 and December 15.





                                      F-16
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


8.  Short-Term Borrowings and Long-Term Debt  (continued)

11 3/4% Senior Subordinated Notes  (continued)

The 11 3/4% Notes are  redeemable  at the option of the Company,  in whole or in
part, at any time during the twelve months  commencing  June 15 of the following
years at the  indicated  percentages  of their  principal  amount,  plus accrued
interest:

                                               Redemption
                  Year                         Percentage
                  ----                         ----------
                  1997...............           105.8750%
                  1998...............           102.9375%
                  1999 and thereafter           100.0000%
              
The 11 3/4% Notes Indenture  contains  covenants which are comparable to or less
restrictive than those under the terms of the Credit Agreement.


9.  Financial Instruments and Risk Management

The Company has entered into interest rate swap agreements with various banks to
manage its exposure to interest rate fluctuations. The agreements are with major
financial  institutions  which are  expected  to fully  perform  under the terms
thereof.  The interest rate swap agreements  effectively  convert  interest rate
exposure from variable rates to fixed rates of interest  without the exchange of
the  underlying  principal  amounts.  A  portion  of  the  Company's  term  debt
instruments  carries a variable rate of interest  based on the London  interbank
offered rate  ("LIBOR") plus a margin  currently  ranging from 2.5% to 3.0%. The
interest rate swap agreements require the Company to pay fixed rates of interest
based  on LIBOR  ranging  from  5.6% to 6.2%  plus  the  aforementioned  margin.
Notional  principal  amounts of these  agreements total $200.0 million and these
agreements mature in the year 1999. The notional amounts are used to measure the
interest to be paid or received and do not  represent  the amount of exposure to
credit loss.  Net payments of $0.3 million under these  agreements  made in 1996
were recorded as adjustments to interest expense.

Concentration of Credit Risk

The Company derives a significant  portion of its revenue from multi-year supply
agreements with many of its customers.  Aggregate  revenues from its two largest
customers  accounted for approximately  29.1% of its net sales in 1996 and 36.0%
of its  net  sales  in  1995.  The  receivable  balances  from  these  customers
collectively  represented 20.3% and 28.2% of the Company's  accounts  receivable
before allowances at December 31, 1996 and 1995, respectively.





                                      F-17
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


9.  Financial Instruments and Risk Management  (continued)

Concentration of Credit Risk  (continued)

As is common in the packaging  industry,  the Company provides  extended payment
terms for some of its  customers  due to the  seasonality  of the  vegetable and
fruit  pack  business.  Exposure  to  losses  is  dependent  on each  customer's
financial  position.  The Company  performs  ongoing  credit  evaluations of its
customer's  financial condition and its receivables are not collateralized.  The
Company maintains an allowance for doubtful  accounts which management  believes
is  adequate  to  cover  potential   credit  losses  based  on  customer  credit
evaluations, collection history, and other information.


10. Fair Value of Financial Instruments

The  carrying  amounts  and  estimated  fair values of the  Company's  financial
instruments at December 31, 1996 and 1995 are as follows:
                                              1996                  1995
                                       -------------------   -------------------
                                       Carrying     Fair     Carrying     Fair
                                        Amount      Value     Amount      Value
                                        ------      -----     ------      -----
                                                 (Dollars in thousands)

Working Capital Facility ...........   $ 27,800   $ 27,800   $  7,100   $  7,100
Bank A Term Loans ..................    194,554    194,554    220,000    220,000
Bank B Term Loans ..................    343,716    343,716    222,750    222,750
11 3/4% Senior Subordinated
  Notes due June 15, 2002 ..........    135,000    144,500    135,000    144,500
Interest Rate Swap Agreements ......       --          504       --         --

Methods and assumptions used in estimating fair values are as follows:

Cash and cash equivalents: The carrying amount reported in the balance sheet for
cash and cash equivalents  approximates  fair value due to the short duration of
those investments.

Short and long-term debt: The carrying amounts of the Company's borrowings under
its working capital loans and  variable-rate  borrowings  approximate their fair
value.  The fair  values of  fixed-rate  borrowings  are based on quoted  market
prices.

Interest  Rate Swap  Agreements:  Fair values of interest  rate swap  agreements
reflect the  estimated  amounts that the Company  would receive to terminate the
contracts at the reporting date based on quoted market prices.




                                      F-18
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


11. Commitments

The Company has a number of noncancelable  operating leases for office and plant
facilities, equipment and automobiles that expire at various dates through 2020.
Certain  operating leases have renewal  options.  Minimum future rental payments
under these leases are (in thousands):

                  1997.......................      $13,779
                  1998.......................       10,615
                  1999.......................        8,181
                  2000.......................        6,257
                  2001.......................        4,431
                  2002 and thereafter........        9,213
                                                   -------
                                                   $52,476
                                                   =======
             
Rent expense was approximately $13.9 million in 1996; $10.8 million in 1995; and
$9.1 million in 1994.


12. Retirement Plans

The  Company  sponsors  pension  and  defined  contribution  plans  which  cover
substantially   all   employees,   other   than  union   employees   covered  by
multi-employer   defined  benefit  pension  plans  under  collective  bargaining
agreements.  Pension  benefits  are provided  based on either a career  average,
final pay or years of service formula. With respect to certain hourly employees,
pension  benefits  are  provided  for based on stated  amounts  for each year of
service.  It is the  Company's  policy  to  fund  accrued  pension  and  defined
contribution  costs in compliance with ERISA  requirements.  Assets of the plans
consist primarily of equity and bond funds.





                                      F-19
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


12. Retirement Plans  (continued)

The following  table sets forth the funded  status of the  Company's  retirement
plans as of December 31, 1996 and 1995:

                                         Plans in which        Plans in which
                                          Assets Exceed          Accumulated
                                           Accumulated            Benefits
                                            Benefits            Exceed Assets
                                       ------------------    ------------------
                                         1996       1995       1996       1995
                                         ----       ----       ----       ----
                                                (Dollars in thousands)
Actuarial present value of
 benefit obligations:
  Vested benefit obligations .......   $14,009    $12,135    $33,558    $31,465
  Non-vested benefit obligations ...       383        547      4,718      3,158
                                       -------    -------    -------    -------
Accumulated benefit obligations ....    14,392     12,682     38,276     34,623
Additional benefits due to
  future salary levels .............     6,255      5,667      6,526      7,132
                                       -------    -------    -------    -------
Projected benefit obligations ......    20,647     18,349     44,802     41,755
Plan assets at fair value ..........    15,055     12,988     31,265     23,535
                                       -------    -------    -------    -------
Projected benefit obligation
  in excess of plan assets .........     5,592      5,361     13,537     18,220
Unrecognized actuarial gain (loss)..       110       (165)     3,476      1,237
Unrecognized prior service costs ...      (565)      (615)    (2,052)    (2,128)
Additional minimum liability .......      --         --        1,124      1,990
                                       -------    -------    -------    -------
Accrued pension liability
  recognized in the balance sheet...   $ 5,137    $ 4,581    $16,085    $19,319
                                       =======    =======    =======    =======

For certain pension plans with accumulated  benefits in excess of plan assets at
December  31,  1996 and  December  31,  1995,  the  balance  sheet  reflects  an
additional  minimum  pension  liability  and  related  intangible  asset of $1.1
million and $2.0 million, respectively.

The  components of net periodic  pension costs for defined  benefit plans are as
follows:

                                                     1996       1995       1994
                                                     ----       ----       ----
                                                       (Dollars in thousands)
 
Service cost .................................     $5,229     $3,067     $2,947
Interest cost ................................      4,452      3,887      3,334
Actual (return) loss on assets ...............     (3,946)    (7,284)       539
Net amortization and deferrals ...............        650      5,008     (2,698)
                                                   ------     ------     ------
    Net periodic pension cost ................     $6,385     $4,678     $4,122
                                                   ======     ======     ======
   



                                      F-20
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


12. Retirement Plans  (continued)

The Company participates in several  multi-employer  pension plans which provide
defined  benefits to certain of its union  employees.  The  composition of total
pension cost for 1996, 1995, and 1994 in the Company's  Consolidated  Statements
of Operations is as follows:
                                                  1996     1995     1994
                                                  ----     ----     ----
                                                  (Dollars in thousands)

       Net periodic pension cost ............   $ 6,385   $4,678   $4,122
       Settlement and curtailment losses, net        48      418     --
       Contributions to multi-employer
         union plans ........................     3,813    2,708    2,700
                                                -------   ------   ------
           Total pension costs ..............   $10,246   $7,804   $6,822
                                                =======   ======   ======

The assumptions used in determining the actuarial  present value of plan benefit
obligations as of December 31, 1996, 1995 and 1994 are as follows:

                                                   1996     1995     1994
                                                   ----     ----     ----

       Discount rate ........................      7.5%     7.5%     8.5%
       Weighted average rate of
         compensation increase ..............      4.0%     4.0%     4.5%
       Expected long-term rate of
         return on plan assets ..............      9.0%     8.5%     8.5%
  
The Company also sponsors defined  contribution pension and profit sharing plans
covering  substantially all employees.  Company contributions to these plans are
based upon employee  contributions  and operating  profitability.  Contributions
charged to income for these  plans were $4.5  million in 1996;  $1.7  million in
1995;  and $2.5  million  in 1994.  Improved  operating  performance  in 1996 as
compared  to 1995  resulted in greater  contributions  to the  Company's  profit
sharing plans.


13. Postretirement Benefits Other than Pensions

The Company  has  defined  benefit  health  care and life  insurance  plans that
provide   postretirement   benefits   to  certain   employees.   The  plans  are
contributory,  with retiree  contributions  adjusted annually,  and contain cost
sharing features including deductibles and coinsurance.  Retiree health benefits
are paid as covered expenses are incurred.




                                      F-21
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


13. Postretirement Benefits Other than Pensions  (continued)

The following table presents the funded status of the  postretirement  plans and
amounts  recognized in the  Company's  balance sheet as of December 31, 1996 and
1995:
                                                        1996       1995
                                                          ----       ----
                                                       (Dollars in thousands)
     Accumulated postretirement benefit obligation:
       Retirees ...................................     $ 2,691    $ 1,587
       Fully eligible active plan participants ....       5,576     11,647
       Other active plan participants .............      18,214     14,770
                                                        -------    -------
     Total accumulated postretirement
       benefit obligation .........................      26,481     28,004
     Unrecognized net loss (gain) .................       2,993     (2,929)
     Unrecognized prior service costs .............        (275)      (298)
                                                        -------    -------
     Accrued postretirement benefit liability .....     $29,199    $24,777
                                                        =======    =======

Net periodic postretirement benefit cost include the following components:

                                                    1996     1995     1994
                                                    ----     ----     ----
                                                    (Dollars in thousands)

     Service cost .............................    $  871   $  372   $ 321
     Interest cost ............................     1,766    1,097     412
     Net amortization and deferral ............        25       42     (14)
                                                   ------   ------   -----
       Net periodic postretirement benefit cost    $2,662   $1,511   $ 719
                                                   ======   ======   =====
  
The  weighted   average   discount  rate  used  to  determine  the   accumulated
postretirement benefit obligation as of December 31, 1996 and 1995 was 7.5%. The
net periodic  postretirement benefit costs were calculated using a discount rate
of 7.5% in 1996 and  discount  rates  ranging  from 7.5% to 8.5% for  1995.  The
assumed  health  care  cost  trend  rates  used  in  measuring  the  accumulated
postretirement benefit obligation in 1996 ranged from 10% to 9.5% for pre-age 65
retirees  and was 9.0% for  post-age  65  retirees,  declining  gradually  to an
ultimate rate of 5.5% over the next 12 years.

A 1% increase in the health care cost trend rate  assumption  would increase the
accumulated  postretirement  benefit  obligation  as of  December  31,  1996  by
approximately  $1.7  million  and  increase  the  aggregate  of the  service and
interest  cost  components of the net periodic  postretirement  benefit cost for
1996 by approximately $0.2 million.





                                      F-22
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


14. Income Taxes

The components of income tax expense are as follows:

                                            1996       1995       1994
                                            ----       ----       ----
                                              (Dollars in thousands)
       Current
         Federal .....................    $  --       $  500    $ 2,500
         State .......................      3,000      1,900      3,200
         Foreign .....................        300        100       (100)
                                          -------     ------    -------
                                            3,300      2,500      5,600
       Deferred
         Federal .....................     17,600      4,100      5,400
         State .......................       --         --         --
         Foreign .....................       --         --         --
                                          -------     ------    -------
                                           17,600      4,100      5,400
                                          -------     ------    -------
                                          $20,900     $6,600    $11,000
                                          =======     ======    =======

Income tax expense is included in the financial statements as follows:

                                            1996       1995       1994
                                            ----       ----       ----
                                             (Dollars in thousands)
       Income before
         extraordinary charges .......    $20,900     $8,700    $11,000
       Extraordinary charges .........       --       (2,100)      --
                                          -------     ------    -------
                                          $20,900     $6,600    $11,000
                                          =======     ======    =======

The income tax provision  varied from that computed by using the U.S.  statutory
rate as a result of the following:


                                           1996       1995       1994
                                           ----       ----       ----
                                             (Dollars in thousands)
       Income tax benefit at the U.S. 
         federal income tax rate .....    $18,627     $6,466    $ 8,069
       State and foreign tax expense,
         net of federal income benefit      2,145      1,625      2,015
       Amortization of goodwill ......        687        471        576
       Other .........................       (559)       138        340
                                          -------     ------    -------
                                          $20,900     $8,700    $11,000
                                          =======     ======    =======


  



                                      F-23
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


14. Income Taxes  (continued)

Deferred  income  taxes  reflect  the net tax  effect of  temporary  differences
between the carrying  amounts of assets and liabilities for financial  reporting
purposes and the amounts used for income tax purposes. Significant components of
the Company's  deferred tax liabilities and assets at December 31, 1996 and 1995
are as follows:

                                                      1996       1995
                                                      ----       ----
                                                  (Dollars in thousands)
         Deferred tax liabilities:
           Tax over book depreciation ...........   $65,000    $53,400
           Book over tax basis of assets acquired    13,200     16,100
           Other ................................     4,100      3,900
                                                    -------    -------
             Total deferred tax liabilities .....    82,300     73,400

         Deferred tax assets:
           Book reserves not yet deductible
             for tax purposes ...................    59,200     56,300
           Net operating loss carryforwards .....     3,800      3,800
           Benefit taken for Holdings' losses ...    25,800     10,200
           Other ................................       483         83
                                                    -------    -------
             Total deferred tax assets ..........    89,283     70,383
                                                    -------    -------

         Net deferred tax liabilities (assets) ..   $(6,983)   $ 3,017
                                                    =======    =======

The Company files a consolidated  federal  income tax return with  Holdings.  In
accordance  with the tax  allocation  agreement,  the  Company is  obligated  to
reimburse  Holdings  for the use of  Holdings'  losses  only to the extent  that
Holdings has taxable  income on a  stand-alone  basis.  A liability has not been
established to the extent of the use of Holdings'  losses since the  possibility
of the ultimate  payment for these benefits is considered  remote.  Accordingly,
the use of Holdings' losses has been accounted for as a contribution of capital.

Also, in accordance with the tax allocation  agreement,  the Company is required
to reimburse  Holdings for its allocable  share of Holdings' tax liability.  The
Company's share of Holdings' federal tax liability, for alternative minimum tax,
aggregated $0.5 million in 1995 and $1.5 million in 1994.  Holdings did not have
a federal tax liability in 1996.




                                      F-24
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


14. Income Taxes  (continued)

On a  consolidated  basis,  the Company and  Holdings  have net  operating  loss
carryforwards  at December 31, 1996 of  approximately  $164.0  million which are
available to offset future  consolidated  taxable income of the group and expire
from 2001 through 2011.  The Company and Holdings,  on a  consolidated  basis at
December 31, 1996,  have $3.9 million of  alternative  minimum tax credits which
are available  indefinitely  to reduce  future tax payments for regular  federal
income tax purposes.

At December 31, 1996,  the Company,  if reporting on a separate  company  basis,
would have had net operating loss  carryforwards for federal income tax purposes
of  approximately  $8.0  million,  which are  subject  to  limitation  under the
consolidated return regulations, and expire from 2001 to 2007.


15. Acquisition Reserves

In  connection  with the  acquisition  of AN Can, the Company has  finalized its
plant  rationalization  and integration  plans. These plans consist primarily of
the closing or downsizing of certain manufacturing plants and the integration of
the  selling,  general  and  administrative  functions  of  the  former  AN  Can
operations with the Company.  Provisions were established for such planned costs
which  include  approximately  $22.6 million  related to employee  severance and
relocation costs, $3.5 million related to administrative  workforce  reductions,
and $23.4 million related to plant exit costs and other acquisition liabilities.
The timing of the plant rationalizations,  among other things, will be dependent
on covenants in existing labor  agreements and  accordingly  these costs will be
incurred  during the period  through 1998.  During 1996 and 1995,  respectively,
costs of $6.5 million and $0.9 million were incurred  primarily  for  relocation
and severance in connection with administrative workforce reductions.


16. Stock Option Plans

Containers  and  Plastics  have  established  stock  option  plans for their key
employees  pursuant  to which  options  to  purchase  shares of common  stock of
Holdings and its  subsidiaries  and stock  appreciation  rights  ("SARs") may be
granted.

Options  granted  under  the  plans may be either  incentive  stock  options  or
non-qualified  stock  options.  To date,  all stock  options  granted  have been
non-qualified stock options. Under the plans,  Containers and Plastics have each
reserved 1,200 shares of their common stock for issuance under their  respective
plans.  Containers has 13,764 shares and Plastics has 13,800 shares of $0.01 par
value common stock currently issued, and all such shares are owned by Silgan.




                                      F-25
<PAGE>

>


                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


16. Stock Option Plans  (continued)

The SARs  extend to the shares  covered by the options  for the  Containers  and
Plastics  plans and  provide for the payment to the holders of the options of an
amount in cash equal to the excess of, in the case of Containers' plans, the pro
forma book value,  as defined,  of a share of common stock (or in the event of a
public  offering  or a change of control  (as  defined in such  plan),  the fair
market value of a share of common stock) over the exercise  price of the option,
with certain adjustments for the portion of vested stock appreciation rights not
paid at the  time of the  recapitalization  in June  1989;  or,  in the  case of
Plastics'  plan,  in the event of a public  offering  or a change in control (as
defined in such plan), the fair market value of a share of common stock over the
exercise price of the option.

Prior to a public  offering  or change in  control,  should  an  employee  leave
Containers,  Containers  has the right to  repurchase,  and the employee has the
right to require  Containers to repurchase,  the common stock of Containers held
by the employee at the then pro forma book value.

At December 31, 1996,  there were  outstanding  options for 936 shares under the
Containers  plan and 1,200 shares under the Plastics plan.  The exercise  prices
per share  range from  $2,122 to $4,933 for the  Containers  options and $126 to
$993 for the  Plastics  options.  The stock  options and SARs  generally  become
exercisable  ratably over a five-year  period.  At December 31, 1996, there were
846  options/SARs  exercisable  under the Containers  plan and 420  options/SARs
exercisable  under the Plastics  plan. For the year ended December 31, 1994, 240
options  were  granted  under the  Containers  plan and 900 options were granted
under the Plastics  plan. For the year ended December 31, 1995, 300 options were
granted  under the Plastics  plan.  There were no grants in 1996.  For the years
ended December 31, 1996,  1995, and 1994, no options were exercised under any of
the plans.  The  Company  incurred  charges  relating to the vesting of benefits
under the stock option  plans of $0.8 million in 1996,  $0.4 million in 1995 and
$1.5 million in 1994.

In the event of a public offering of any of Holdings'  capital stock or a change
in control of  Holdings,  (i) the options  granted by  Containers  and  Plastics
pursuant to the plans and (ii) any stock issued by  Containers  upon exercise of
such  options are  convertible  into  either  stock  options or common  stock of
Holdings,  as the case may be. The  conversion of such options or shares will be
based upon a valuation of Holdings and an  allocation  of such value between the
subsidiaries  after giving  affect to, among other  things,  that portion of the
outstanding indebtedness of Holdings allocable to each such subsidiary.





                                      F-26
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


16. Stock Option Plans  (continued)

For the year ended December 31, 1995, the value of the options granted under the
Plastic  plan were not  significant.  Accordingly,  the impact on net income and
earnings per share from the issuance of these  options  would not be  materially
different from amounts currently reported and would not require SFAS No. 123 pro
forma disclosure.


17. Stockholder's Equity

The Company's authorized capital stock consists of 1,000 shares each of Class A,
B and C Common  Stock  ($.01 par  value)  and  preferred  stock.  The  Company's
outstanding  capital  stock at December 31, 1996 and 1995 consists of 1 share of
Class A Common Stock and 1 share of Class B Common Stock. Both shares are issued
to Holdings.

During 1996 and 1995,  respectively,  the Company distributed $147.5 million and
$57.6  million to  Holdings  from  proceeds  received  through  additional  bank
borrowings of B Term Loans and Working Capital Loans.  Holdings used these funds
to redeem a portion  of its  Discount  Debentures  and to pay  accrued  interest
thereon.


18. Related Party Transactions

Pursuant to various management services agreements (the "Management Agreements")
entered into between  Holdings,  Silgan,  Containers,  Plastics,  and S&H,  Inc.
("S&H"),  a company  wholly-owned  by Mr.  Silver,  the  Chairman  and  Co-Chief
Executive  Officer of Holdings and Silgan,  and Mr. Horrigan,  the President and
Co-Chief Executive Officer of Holdings and Silgan, S&H provides Holdings, Silgan
and its subsidiaries  with general  management,  supervision and  administrative
services.

In consideration  for its services,  S&H receives a fee of 4.95% (of which 0.45%
is payable to MS & Co.) of Holdings'  consolidated earnings before depreciation,
amortization,  interest  and taxes  ("EBIDTA")  until  EBIDTA  has  reached  the
Scheduled Amount set forth in the Management  Agreements and 3.3% (of which 0.3%
is payable to MS & Co.) after EBIDTA has exceeded the Scheduled Amount up to the
Maximum Amount as set forth in the Management Agreements, plus reimbursement for
all related out-of-pocket expenses.





                                      F-27
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


18. Related Party Transactions  (continued)

The total amount  incurred under the  Management  Agreements was $5.3 million in
1996,  $5.4 million in 1995, and $5.0 million in 1994, and was allocated,  based
upon EBIDTA, as a charge to operating income of each business segment.  Included
in accounts  payable at December 31, 1996 and 1995, was $0.1 million  payable to
S&H.  Under the terms of the  Management  Agreements,  the  Company  has agreed,
subject to  certain  exceptions,  to  indemnify  S&H and any of its  affiliates,
officers,  directors,  employees,  subcontractors,  consultants  or  controlling
persons  against any loss or damage they may sustain  arising in connection with
the Management Agreements.

In connection with the Credit Agreement and its related  amendments entered into
during 1996 and 1995,  the banks  thereunder  (including  Bankers Trust Company)
received fees totaling $1.6 million in 1996 and $17.2 million in 1995.


19. Litigation

In  connection  with the  acquisition  by Holdings of Silgan as of June 30, 1989
(the  "Merger"),  a  decision  was  rendered  in 1995 by the  Delaware  Court of
Chancery  with  respect  to  appraisal   proceedings  filed  by  certain  former
stockholders  of 400,000  shares of stock of Silgan.  Pursuant to that decision,
these former  holders were awarded  $5.94 per share,  plus simple  interest at a
rate of 9.5%. This award was less than the amount,  $6.50 per share,  that these
former  holders  would have  received in the Merger.  The right of these  former
holders to appeal the Chancery Court's  decision has expired,  and Silgan made a
distribution to Holdings and Holdings  tendered payment of $3.8 million to these
former holders in 1995. In 1994, prior to the trial for appraisal,  Holdings and
the former holders of an additional  650,000 shares of stock of Silgan agreed to
a  settlement  in  respect  of  their  appraisal  rights,   and  Silgan  made  a
distribution  to Holdings in order to make  payment of $6.9  million,  including
interest, in respect of the settlement.

There are no other pending legal  proceedings to which the Company is a party or
to which any of its properties are subject which would have a material effect on
the Company's financial position.





                                      F-28
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


20. Business Segment Information

The Company is engaged in the packaging industry and operates principally in two
business  segments.  Both  segments  operate  in  North  America.  There  are no
intersegment  sales.  Presented  below  is  a  tabulation  of  business  segment
information for each of the past three years:
                               Net       Oper.   Identifiable  Dep. &   Capital
                               Sales     Profit      Assets     Amort.   Expend.
                               -----     ------      ------     ------   -------
1996                                        (Dollars in millions)
----                                    
Metal container
  & specialty(1) .....       $1,189.3     $106.8     $738.4     $44.0     $39.1
Plastic container ....          216.4       18.4      158.5      14.6      17.6
                              -------     ------     ------     -----     -----
  Total ..............       $1,405.7     $125.2     $896.9     $58.6     $56.7
                             ========     ======     ======     =====     =====

1995
----
Metal container
  & specialty(1) .....       $  882.3     $ 58.2 (2) $726.7     $31.6     $32.5
Plastic container ....          219.6       13.2      159.4      13.8      19.4
                             --------     ------    -------     -----     -----
  Total ..............       $1,101.9     $ 71.4     $886.1     $45.4     $51.9
                             ========     ======     ======     =====     =====

1994
----
Metal container
  & specialty(1) .....       $  657.1     $ 59.8 (3) $335.3     $23.1     $16.9
Plastic container ....          204.3       (0.1)(3)  162.8      14.1      12.3
                             --------     ------    -------     -----     -----
  Total ..............       $  861.4     $ 59.7     $498.1     $37.2     $29.2
                             ========     ======     ======     =====     =====



(1)   Specialty  packaging  sales  include  closures,  plastic bowls,  and paper
      containers  used by  processors and packagers in the food industry and are
      not significant enough to be reported as a separate segment.

(2)   Includes charge for reduction in carrying value of assets of $14.7 million
      for the metal container segment.

(3)   Includes  charges  for  reduction  in  carrying  value  of  assets of $7.2
      million for the metal container  segment and $9.5 million for the  plastic
      container segment, respectively.




                                      F-29
<PAGE>




                               SILGAN CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 1996, 1995 and 1994


20. Business Segment Information  (continued)

Operating profit is reconciled to income before tax as follows:

                                           1996     1995     1994
                                           ----     ----     ----
                                            (Dollars in millions)

             Operating profit .........   $125.2    $71.4    $59.7
             Interest expense .........     71.5     52.5     36.1
             Corporate expense ........      0.5      0.4      0.5
                                          ------    -----    -----
               Income before
                  income taxes ........   $ 53.2    $18.5    $23.1
                                          ======    =====    =====

Identifiable assets are reconciled to total assets as follows:

                                           1996     1995     1994
                                           ----     ----     ----
                                            (Dollars in millions)

             Identifiable assets ......   $896.9   $886.1   $498.1
             Corporate assets .........      3.5      2.6      2.0
                                          ------   ------   ------
               Total assets ...........   $900.4   $888.7   $500.1
                                          ======   ======   ======

Metal  container and other  segment  sales to Nestle Food Company  accounted for
17.1%,  21.4%,  and 25.9% of net sales of the  Company  during  the years  ended
December 31, 1996, 1995, and 1994, respectively.  Sales to Del Monte Corporation
accounted  for 12.0%,  14.5%,  and 21.4% of net sales of the Company  during the
years ended December 31, 1996, 1995, and 1994, respectively.


21. Subsequent Events 

On February 20, 1997, an initial public offering (the "IPO") of 5,175,000 shares
of Holdings' Common Stock, par value $.01 per share was completed. Holdings used
net  proceeds  from  the  IPO  to  redeem  its  remaining  Discount   Debentures
(approximately  $59.0 million) and advanced funds to Silgan for the repayment of
approximately $8.9 million of bank term loans.

Under the terms of the stock  option plans of  Containers  and  Plastics,  stock
options issued under such plans were converted to Holdings'  options at the time
of the IPO. In accordance with APB No. 25, options granted under these plans are
considered  variable  options  with a  final  measurement  date  at the  time of
conversion.  The Company will recognize a non-cash charge of approximately $22.9
million,  net of $3.3 million previously  accrued, in the first quarter of 1997,
for the excess of the fair market  value over the grant  price of these  options
less amounts previously accrued.


                                      F-30
<PAGE>



                                                                    SCHEDULE I



              CONDENSED FINANCIAL INFORMATION OF SILGAN CORPORATION
                            CONDENSED BALANCE SHEETS
                           December 31, 1996 and 1995
                             (Dollars in thousands)

                                                           1996         1995
                                                           ----         ----
ASSETS
Current assets:
  Cash and cash equivalents ........................    $     60     $     29
  Notes receivable - subsidiaries ..................      38,427       28,140
  Interest receivable - subsidiaries ...............       9,085        4,342
  Other current assets .............................          74           70
                                                        --------     --------
    Total current assets ...........................      47,646       32,581

Investment in and other amounts due
  from subsidiaries ................................        --         26,181
Notes receivable - subsidiaries ....................     638,915      553,682
Amount receivable from parent ......................       2,810        2,175
Other assets .......................................         544          518
                                                        --------     --------
                                                        $689,915     $615,137
                                                        ========     ========

LIABILITIES AND STOCKHOLDER'S EQUITY (DEFICIT)
Current liabilities:
  Current portion of term loans ....................    $ 38,427     $ 28,140
  Accrued interest payable .........................       9,085        4,342
  Accrued expenses .................................          60        1,457
                                                        --------     --------
      Total current liabilities ....................      47,572       33,939

Excess of distributions over investment
   in subsidiaries .................................      70,851         --
Long-term debt .....................................     634,843      549,610
Amounts payable to subsidiaries ....................      17,064       14,890
Other long-term liabilities ........................       4,344        3,838

Stockholder's equity:
  Common stock .....................................        --           --
  Additional paid-in capital .......................      91,235       73,635
  Accumulated deficit ..............................    (175,994)     (60,775)
                                                        --------     --------
    Total stockholder's equity (deficit) ...........     (84,759)      12,860
                                                        --------     --------
                                                        $689,915     $615,137
                                                        ========     ========


      See Notes to Consolidated Financial Statements for Silgan Corporation
                           appearing elsewhere herein.




                                      F-31
<PAGE>



                                                                   SCHEDULE I

              CONDENSED FINANCIAL INFORMATION OF SILGAN CORPORATION
                       CONDENSED STATEMENTS OF OPERATIONS
              For the years ended December 31, 1996, 1995 and 1994
                             (Dollars in thousands)

                                                 1996      1995       1994
                                                 ----      ----       ----

Net sales ..................................   $  --      $  --      $  --

Cost of goods sold .........................      --         --         --
                                               -------    -------    -------

     Gross profit ..........................      --         --         --

Selling, general and administrative
  expenses .................................       513        416        543
                                               -------    -------    -------

     Loss from operations ..................      (513)      (416)      (543)

Equity in earnings of consolidated
  subsidiaries .............................    32,905      8,731     13,445

Other income (expenses) ....................      --       (1,219)      (651)

Interest expense and other related
  financing costs ..........................   (58,857)   (41,822)   (30,039)

Interest income - subsidiaries .............    58,784     41,699     29,841
                                               -------    -------    -------

     Income before income taxes ............    32,319      6,973     12,053

Income taxes ...............................      --         --         --
                                               -------    -------    -------

     Income before extraordinary charge ....    32,319      6,973     12,053

Extraordinary charge relating to
  early extinguishment of debt .............      --         (167)      --
                                               -------    -------    -------

     Net income ............................   $32,319    $ 6,806    $12,053
                                               =======    =======    =======





      See Notes to Consolidated Financial Statements for Silgan Corporation
                           appearing elsewhere herein.




                                      F-32
<PAGE>



                                                                   SCHEDULE I


              CONDENSED FINANCIAL INFORMATION OF SILGAN CORPORATION
                       CONDENSED STATEMENTS OF CASH FLOWS
              For the years ended December 31, 1996, 1995 and 1994
                             (Dollars in thousands)


                                               1996          1995        1994
                                               ----          ----        ----


Cash flows from operating activities: .....  $      31    $   3,669    $  7,005
                                             ---------    ---------    --------

Cash flows from investing activities:
  (Increase) decrease in notes         
    receivable - subsidiaries .............    (95,520)    (273,214)     35,462
  (Increase) in investment in subsidiaries        --           --       (14,998)
  Cash distributions received from
    subsidiaries ..........................    147,538       57,596        --
                                             ---------    ---------    --------
Net cash provided (used) by investing
  activities ..............................     52,018     (215,618)     20,464
                                             ---------    ---------    --------

Cash flows from financing activities:
  Proceeds from issuance of long-term debt     125,000      450,000        --
  Repayments of long-term debt ............    (29,480)    (176,786)    (20,464)
  Payments to former shareholders .........       --         (3,795)     (6,911)
  Distributions to Parent .................   (147,538)     (57,596)       --
                                             ---------    ---------    --------
Net cash (used) provided by financing
  activities ..............................    (52,018)     211,823     (27,375)
                                             ---------    ---------    --------

Net increase (decrease) in cash and cash
  equivalents .............................         31         (127)         94

Cash and cash equivalents at the beginning
  of year .................................         29          155          61
                                             ---------    ---------    --------

Cash and cash equivalents at end of year ..  $      60    $      29    $    155
                                             =========    =========    ========



      See Notes to Consolidated Financial Statements for Silgan Corporation
                           appearing elsewhere herein.




                                      F-33
<PAGE>



                                                                    SCHEDULE II

                               SILGAN CORPORATION
                 SCHEDULES OF VALUATION AND QUALIFYING ACCOUNTS
              For the years ended December 31, 1996, 1995 and 1994
                             (Dollars in thousands)


Column A                 Column B        Column C          Column D    Column E
                                         Additions
                                         ---------
                                                Charged
                        Balance at  Charged to  to other                Balance
                        beginning   costs and   accounts   Deductions  at end of
Description             of period    expenses   describe   describe(1)  period
-----------             ---------    --------   --------   -----------  ------

For the year ended 
 December 31, 1994:

Allowance for
  doubtful accounts
  receivable ............  $1,084      $621     $    58        $206      $1,557
                           ======      ====     =======        ====      ======


For the year ended
 December 31, 1995:

Allowance for
  doubtful accounts
  receivable ............  $1,557      $295     $ 3,872(2)     $881      $4,843
                           ======      ====     =======        ====      ======


For the year ended
 December 31, 1996:

Allowance for
  doubtful accounts
  receivable ............  $4,843      $572     $(1,041)(3)    $329      $4,045
                           ======      ====     =======        ====      ======


(1) Uncollectible accounts written off, net of recoveries.

(2) Represents the accounts receivable allowance for doubtful accounts assumed 
    upon the acquisition of AN Can.

(3) Principally   represents  the  final  purchase  price  allocation  for  the
    acquisition of AN Can.


                                      F-34







                                                          



<PAGE>



                                INDEX TO EXHIBITS



Exhibit No.                           Exhibit
-----------                           -------

    27                         Financial Data Schedule.




<PAGE>