Document:

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                                                                   Exhibit 10.15

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           TERM OF LEASE
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    BEGINNING         ENDING            Above Space for Recorder's use only
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  November 19, 1999  November 18, 2002
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                     DATE OF LEASE         LOCATION OF PREMISES

                     November 19, 1999         6451 W. 51/st/ Street
                                        Building identified as "High One Story
                                           Building w/ Inground Downspouts"
                                         shown on the attached Plat of Survey
                                        (hereinafter referred to as "Premises").
                                        Lessor agrees also to provide Lessee six
                                            (6) parking spaces sufficient to
                                             park six (6) tractor trailers
                     ------------------------------ ----------------------------
                                  PURPOSE
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               LESSEE                        LESSOR
NAME     .Packaging Dynamics, L.L.C.   NAME    6501 Corporation, Attn: Rich Urso
ADDRESS  .3900 West 43rd Street        ADDRESS 4222 South Knox
CITY     .Chicago, Illinois 60632      CITY    Chicago, Illinois 60632

In consideration of the mutual covenants and agreements herein stated, Lessor
hereby leases to Lessee and Lessee hereby leases from Lessor solely for the
above purposes designated above (the "Premises"), together with the
appurtenances thereto, for the above Term.

                         LEASE COVENANTS AND AGREEMENTS

1.   RENT AND SECURITY DEPOSIT. Except for the period of November 19,1999 to
December 18, 1999, Lessee shall pay Lessor or Lessor's agent as rent for the
Premises the sum stated on the attached Schedule 1 (along with the separately
stated charge of for taxes and common area maintenance shown on schedule 1
(hereinafter referred to as "Tax Charges")), monthly in advance, until lawful
termination of this lease, at Lessor's address stated above or such other
address as Lessor may designate in writing. For the period of November 19,1999
to December 18, 1999, Lessor agrees that Lessee may occupy the Premises at no
charge. All charges imposed under this paragraph will be deemed rent. Lessor and
Lessee agree that the total square foot of the Premises is 48,700.

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     Lessee agrees that any and all installments of rent accruing under the
provisions of this Lease, which shall not be paid when due, shall bear interest
at the rate of five percent (S%) per annum in excess of the prime rate charged
by a principal bank in Chicago, Illinois, to its commercial borrowers as
determined on the first date of a delinquency from the day when the same is or
are payable by the terms of this Lease, until the same shall be paid; provided
if any installment or installments of said rent shall become due on a Sunday or
legal holiday the same shall be paid without interest on the next succeeding
regular business day.

     Lessee herewith deposits with Lessor $18,871.25 as security for the
performance by Lessee of every covenant and condition of this Lease. Said
deposit may be commingled with other funds of Lessor, but shall bear interest at
the rate of five (5) percent per annum. If Lessee shall default with respect to
any covenant or condition of this Lease, Lessor may apply the whole or any part
of such security deposit, including any interest earned, to the payment of any
sum in default or any sum which Lessor may be required to spend by reason of
Lessee's default. This includes, but is not limited to, applying the security
deposit first to any restoration and/or cleanup costs necessary over and above
normal wear and tear of the vacated space. It is understood that the security
deposit is not to be considered as the last month's rent under the Lease. Should
Lessee comply with all of the covenants and conditions of this Lease, the
security deposit or any balance thereof shall be returned to Lessee at the
expiration of the Term hereof.

2.   OPTION TO RENEW. Lessee shall have the option to renew the term of this
Lease by an additional two years, if Lessee is not in breach of this lease, by
sending to Landlord a written notice of its agreement to exercise its option
hereunder, signed by Lessee's authorized agent, no later than six months prior
to the expiration of the term set forth above. In the event Lessee exercises its
option under this paragraph, the terms of the lease for the additional two year
extension will remain the same except that rent and the Tax Charges for each
year will increase by the then most recent percentage increase in the Consumer
Price Index published by the Federal Government.

3.   CONDITION AND UPKEEP OF PREMISES. Lessor promises to Lessee (a) that all
existing structural elements and systems of, and improvements to, the Premises
including, but not limited to, the plumbing, fire sprinkler system, lighting,
electrical systems, boiler, doors, loading docks, windows, driveways, access to
public roads, parking lots and sidewalks shall be in good operating condition on
the commencement date and shall comply with all applicable laws, rules,
regulations, ordinances and building and zoning codes in effect and applicable
to the Premises on the commencement date, and (b) that the Premises contain an
adequate heating system, a new bathroom facility and adequate ceiling and wall
insulation. Lessor agrees that during the term of this Lease, it will keep and
maintain in working order the existing structural elements of the Premises,
including the roof and all driveways, access to public roads, parking lots and
sidewalks of the Premises and Lessee will maintain and keep in good working
order all other portions of the Premises, including,

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but not limited to the plumbing, fire sprinkler system, lighting, electrical
systems, boiler, doors, loading docks and windows. Lessee will keep the Premises
including all appurtenances, in good repair, replacing all broken glass with
glass of the same size and quality as that broken, and will replace all damaged
plumbing fixtures with others of equal quality, and will keep the Premises,
including adjoining alleys, in a clean and healthful condition according to the
applicable municipal ordinances and the direction of the proper public officers
during the term of this Lease at Lessee's expense, and will remove the snow and
ice from the sidewalk abutting the Premises; and upon the termination of this
lease, in any way, will yield up the Premises to Lessor, in good condition and
repair, loss by fire, casualty and ordinary wear and tear excepted.

4.   LESSEE NOT TO MISUSE; SUBLET; ASSIGNMENT. Lessee may use and occupy the
Premises for light manufacturing, warehousing, shipping and office use. Lessee
will not allow Premises to be used for any purpose that will increase the rate
of insurance thereon, nor for any purpose other than that hereinbefore
specified, and will not load floors with machinery or goods beyond the floor
load rating prescribed by applicable Municipal ordinances, and will not allow
the Premises to be occupied in whole, or in part, by any other person, and will
not Sublet the same, or any part thereof, nor assign this lease without in each
case the express written consent of the Lessor first had, and Lessee will not
permit any transfer by operation of law of the interest in Premises acquired
through this lease, and will not permit Premises to be used for any unlawful
purpose, or for any purpose that will injure the reputation of the building or
increase the fire hazard of the building, or disturb the tenants or the
neighborhood, and will not permit the same to remain vacant or unoccupied for
more than ten consecutive days.

     Notwithstanding the foregoing, at any time and from time to time, Lessee
may, without Lessor's consent, assign this Lease to a direct or indirect
wholly-owned subsidiary or an affiliate. At any time and from time to time,
Lessee may freely mortgage, pledge or otherwise encumber its interest in the
Premises. Any such mortgage, pledge or other encumbrance shall be referred to as
a "Leasehold Mortgage," which Leasehold Mortgage shall at no time be a lien on
Lessor's interest in the Premises. The holder of any leasehold mortgage
("Leasehold Mortgage") may give written notice to Lessor, specifying the name
and address of the mortgagee under such Leasehold Mortgage (the "Leasehold
Mortgagee") and attaching thereto a true and complete copy of such Leasehold
Mortgage, and if such notice shall be given, thereafter Lessor shall give to
such Leasehold Mortgagee notice of any and all defaults and nonperformance
hereunder not later than the first to occur of (i) the time such notice is given
to Lessee and (ii) the time of the declaration of any default, or the exercise
of any remedy hereunder, addressed to such Leasehold Mortgage at its address
last furnished to Lessor in writing. No such notice by Lessor to Lessee
hereunder shall be deemed to have been duly given unless and until a copy
thereof has been delivered or mailed to such Leasehold Mortgagee. Such Leasehold
Mortgagee, after service of a further notice from Lessor to Leasehold Mortgagee
that Lessee's applicable cure period has expired ("Lessor's Notice"), shall
thereupon have a period of

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forty-five (45) days from Leasehold Mortgagee's receipt of Lessor's Notice for
remedying the default or causing the same to be remedied except that in the case
of non-payment of rent, Leasehold Mortgagee shall have no more than Thirty (30)
days to cure all rent due but not paid, regardless of other provisions in this
lease to the contrary. Such Leasehold Mortgagee, in case Lessee shall be in
default hereunder, shall within the period and otherwise as herein provided,
have the right to remedy such default, or cause the same to be remedied. Lessor,
within the aforesaid period, shall accept performance by any such Leasehold
Mortgagee of any covenant, condition, or agreement on Lessee's part to be
performed hereunder with the same force and effect as though performed by
Lessee. Lessor shall not exercise any right or remedy with respect to any
default in respect of the performance of work required to be performed, or acts
to be done, or conditions to be remedied so long as such Leasehold Mortgagee
shall, in good faith, have commenced promptly to rectify the same and shall
thereafter prosecute the same to completion with diligence and continuity,
provided that all such defaults are cured within forty-five (45) days from the
date of Lessor's Notice or, if such non-monetary default is not reasonably
curable within such forty-five day period, the Leasehold Mortgagee shall
promptly commence a cure and the Leasehold Mortgagee shall complete such cure
within one hundred eighty (180) days after such date, except that with respect
to defaults relating to the non-payment of rent, the cure period set forth above
will apply. No Leasehold Mortgagee shall become liable under the provisions of
this Lease unless and until such time as it becomes the owner of the leasehold
estate covered by its mortgage, and then only for obligations arising during the
time it is the owner of such leasehold estate; provided, however, that the
                                               --------  -------
preceding portion of this sentence shall not limit or restrict in any way
Lessor's authority to terminate this Lease as against any Leasehold Mortgagee
(subject to the provisions hereof) if any default hereunder (including, without
limitation, any default in the payment of rent) has not been completely cured
within the cure period specified herein. In case of termination of this Lease by
reason of an event of default hereunder, Lessor shall give notice thereof
simultaneously to such Leasehold Mortgagee, which notice shall be addressed to
such Leasehold Mortgagee at the address last furnished to Lessor in writing as
above provided. Provided that the Lease was terminated as the result of an event
of default which was personal to Lessee and therefore not curable by the
Leasehold Mortgagee, if such Leasehold Mortgagee notifies Lessor in writing,
within thirty (30) days after the giving of such notice of termination by Lessor
as aforesaid, that it desires to enter into a new lease, Lessor shall execute
and deliver such new lease to such Leasehold Mortgagee for the remainder of the
term of this Lease, at the rent and other charges herein reserved and upon the
covenants, conditions, limitations and agreements herein contained, provided
that such Leasehold Mortgagee shall have paid to Lessor all rent and other
charges due under this Lease and shall have paid to the appropriate authority
any other charges to be paid by Lessee hereunder, up to and including the date
of the commencement of the term of such new lease. Nothing herein contained
shall be deemed to impose any obligation on the part of Lessor to deliver
physical possession of the Premises or any part thereof to such Leasehold
Mortgagee; provided, however, that Lessor shall cooperate with such Leasehold
           --------  -------
Mortgagee (by joining as a party in any appropriate action or proceeding or
otherwise) at the sole cost and expense of such Leasehold Mortgagee, and at no
cost, expense or liability to Lessor, for the purpose of

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enabling such Leasehold Mortgagee to obtain such possession of the Premises. The
Leasehold Mortgagee shall not be required to cure any event of default which is
exclusively personal to Lessee and which the Leasehold Mortgagee has no power to
cure (such as, for example, the bankruptcy of Lessee), as a prerequisite to the
exercise of the rights granted to such Leasehold Mortgagee by the provisions of
this Section. Except as aforesaid, such Leasehold Mortgagee shall remedy all
other events of default hereunder. Any such new lease and the leasehold estate
thereby created shall continue to maintain the same priority as the within Lease
with regard to any mortgage on the Premises or any part thereof or any other
lien, charge or encumbrance thereon caused or made by Lessor whether or not the
same shall then be in existence. The provisions of the preceding sentence are
intended to be self-executing, and Lessor shall not be obligated to expend any
funds or take any other action (other than to execute any documents reasonably
required any title company, at no expense to Lessor) to accomplish or obtain
such priority for any such new lease or leasehold estate. Notwithstanding the
provisions of this Section 4, any Leasehold Mortgagee may foreclose on its
mortgage or accept a deed in lieu of foreclosure without the necessity of
complying with the provisions of hereof; provided, however, that following any
                                         --------  -------
such foreclosure or acceptance of a deed in lieu of foreclosure, the Premises
may be used only for the use and purposes set forth herein, and for no other
purposes without the written consent of Lessor. Each party hereby covenants and
agrees with the other that it shall, within fifteen (15) days after written
notice shall have been given by the other requiring a statement of the status of
the Lease, give such statement in writing indicating whether the Lease is in
good standing, and if it is not, the particulars in which it is not, and failure
within said period of fifteen (15) days to give such written reply shall
constitute a representation that the Lease is in good standing, upon which
representation any person, after the expiration of said fifteen (15) days, may
rely as being true and correct. Upon the written consent of Lessor, which
consent shall not be unreasonably withheld, Lessee shall have the right to
sublet all or any portion of the Premises for any lawful purpose and for
purposes not in contravention of zoning regulations or of any conditions,
covenants, easements or reservations of record affecting the Premises. Lessee
shall at all times, notwithstanding any such subletting, remain directly and
primarily liable to Lessor for the full and faithful performance of all of the
terms and provisions thereof.

5.   MECHANIC'S LIEN. Lessee will not permit any mechanic's lien or other liens
to be placed upon the Premises or any building or improvement thereon during the
term hereof, and in case of the filing of such lien, Lessee will promptly pay
same. If default in payment thereof shall continue for sixty (60) days after
written notice thereof from Lessor to the Lessee, the Lessor shall have the
right and privilege at Lessor's option of paying the same or any portion thereof
without inquiry as to the validity thereof, and any amounts so paid, including
expenses and interest, shall be so much additional indebtedness hereunder due
from Lessee to Lessor and shall be repaid to Lessor immediately on rendition of
bill therefor.

6.  INDEMNITY FOR ACCIDENTS. Lessee covenants and agrees that he will protect
and save and keep the Lessor forever harmless and indemnified against and from
any penalty or damages

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or charges imposed for any violation of any laws or ordinances either occasioned
by the neglect or action of Lessee its agents, officers, directors, employees or
invitees or those holding under Lessee, and that Lessee will at all times
protect, indemnify and save and keep harmless the Lessor against and from any
and all loss, cost, damage or expense, including but not limited to attorneys
fees and costs, arising out of or from any accident or other occurrence on or
about the Premises, causing injury to any person or property which is caused by
the neglect or action of Lessee its agents, officers, directors, employees or
invitees or those holding under Lessee and will protect, indemnify and save and
keep harmless the Lessor against and from any and all claims and against and
from any and all loss, cost, damage or expense, including but not limited to
attorneys fees and costs, arising out of any failure of Lessee in any respect to
comply with and perform all the requirements and provision hereof. This
indemnity shall not apply to any liabilities, obligations, claims, damages,
penalties, causes of action, costs and expenses resulting from the actions or
omissions of Lessor, its employees or agents.

7.   NON-LIABILITY OF LESSOR. Except as provided herein or by Illinois stature,
Lessor shall not be liable for any damage occasioned by failure to keep the
Premises in repair, nor for any damage done or occasioned by or from plumbing,
gas, water, sprinkler, steam or other pipes or sewerage or the bursting, leaking
or running of any pipes, tank or plumbing fixtures, in, above, upon or about
Premises or any building or improvement thereon nor for any damage occasioned by
water, snow or ice being upon or coming through the roof, skylights, trap door
or otherwise, nor for any damages arising from acts or neglect of any owners or
occupants of adjacent or contiguous property.

8.   WATER, GAS AND ELECTRIC CHARGES. Lessee will pay, in addition to the rent
above specified, all water rents, gas and electric light and power bills taxed,
levied or charged on the Premises, for and during the time for which this lease
is granted, and in case said water rents and bills for gas, electric light and
power shall not be paid when due, Lessor shall have the right to pay same, which
amounts so paid, together with any sums paid by Lessor to keep the Premises in a
clean and healthy condition, as above specified, are declared to be so much
additional rent and payable with the installment of rent next due thereafter.

9.   KEEP PREMISES IN REPAIR. Except for Lessor's agreement to keep in a good
operating condition the structure of the premises as herein provided, Lessor
shall not be obliged to incur any expense for repairing any improvements upon
said demised premises or connected therewith, and the Lessee at his own expense
will keep all improvements in good repair (injury by fire, or other causes
beyond Lessee's control, normal wear and tear excepted) and will comply in all
material respects with all local or general regulations, laws and ordinances
applicable thereto, as well as lawful requirements of all competent authorities
in that behalf. If Lessee does not make repairs as required hereunder promptly
and adequately, Lessor may but need not make such repairs and pay the reasonable
costs thereof, and the reasonable costs shall be so much additional rent
immediately due from and payable by Lessee to Lessor.

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     It is expressly understood and agreed that the Lessor shall not be liable
to the Lessee for any loss, cost or expense which the Lessee shall sustain by
reason of any damage at any time to its property caused by or growing out of the
failure of the sewers, structures, or other equipment of the Lessor located on
the Premises, or by any other work which the Lessor may perform on the Premises
under the terms hereof, or adjacent to the Premises except for the gross
negligence or willful misconduct of Lessor.

10.  ACCESS TO PREMISES. Lessee will allow Lessor free access to the Premises
for the purpose of examining or exhibiting the same, or to make any repairs, or
alterations thereof which Lessor may see fit to make and will allow to have
placed upon the Premises at all times notice of "For Sale" and "To Rent" and
will not interfere with the same.

     The Lessor reserves to itself or to its assignees or permittees at any time
during the term of this Lease, upon thirty (30) days written notice given by the
Lessor to the Lessee, the right to construct, reconstruct, maintain, and operate
additional force mains, intercepting sewers, drains, outlets, pipe lines, pole
lines, and appurtenances thereto; and such other structures, buildings,
apparatus, and water control equipment as may be needed for the corporate
purposes of the Lessor upon, under, and across the Premises. Any such
construction shall not materially interfere with Lessee's use of the Premises.

11.  ABANDONMENT AND RELETTING. If Lessee shall abandon or vacate the Premises,
or if Lessee's right to occupy the Premises be terminated by Lessor by reason of
Lessee's breach of any of the covenants herein, the same may be re-let by Lessor
for such rent and upon such terms as Lessor may deem fit, subject to Illinois
statute; and if a sufficient sum shall not thus be realized monthly, after
paying the expenses of such re-letting and collecting to satisfy the rent hereby
reserved, Lessee agrees to satisfy and pay all deficiency monthly during the
remaining period of this lease.

12.  HOLDING OVER. Lessee will, at the termination of this lease by lapse of
time or otherwise, yield up immediate possession to Lessor, and failing so to
do, will pay as liquidated damages, for the whole time such possession is
withheld the sum of eight hundred and sixty seven dollars and twenty six cents
($867.26) per day; but the provisions of this clause shall not be held as a
waiver by Lessor of any right of re-entry as hereinafter set forth, nor shall
the receipt of said rent or any part thereof, or any other act in apparent
affirmance of tenancy, operate as a waiver of the right to forfeit this lease
and the term hereby granted for the period still unexpired, for a breach of any
of the covenants herein.

13.  EXTRA FIRE HAZARD. There shall not be allowed, kept, or used on the
Premises any inflammable or explosive liquids or materials save such as may be
necessary for use in the business

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of the Lessee, and in such case, any such substances shall be delivered and
stored in amount, and used, in accordance with the rules of the applicable
statutes and ordinances now or hereafter in force.

14.  MORTGAGE AND TRANSFER. Lessor shall have the right to transfer, Premises,
the Building, this Lease, and all or any part of the rights now or thereafter
existing and all rents and amounts payable to Lessor under the provisions
hereof, provided the transferee assumes all of Lessor's future obligations under
this Lease and recognizes any of Lessee's rights hereunder. Nothing herein
contained shall limit or restrict any such rights, and the rights of the Lessee
under this Lease shall be subject and subordinate to all instruments executed
and to be executed in connection with the exercise of any such rights,
including, but not limited to, the lien of any mortgage, deed of trust, or
security agreement now or hereafter placed upon Lessor's interest in the
Premises, provided the transferee assumes all of Lessor's future obligations
under this Lease and recognizes any of Lessee's rights hereunder. This paragraph
shall be self-operative. However, Lessee covenants and agrees to execute and
deliver upon demand such further instruments subordinating this Lease to the
lien of any such mortgage, deed of trust or security agreement as shall be
requested by the Lessor and/or mortgagee or proposed mortgagee or holder of any
security agreement. Notwithstanding the foregoing paragraph, Lessee shall not be
disturbed in its possession of the Premises so long as Lessee is not in default
hereunder or in material breach hereof.

     Lessee covenants and agrees promptly to execute and deliver to Lessor upon
demand estoppel letters setting forth (i) the date of this Lease and any
amendments thereto, (ii) the date through which rents have paid hereunder, (iii)
the amount of any security deposit held by Lessor, (iv) that Lessee is in
occupancy of the Premises, (v) that the Lease is in full force and effect, (vi)
that Lessor is not in default under the Lease and that there are no defenses or
offsets against the enforcement thereof, or setting forth such defaults,
defenses or offsets claimed by Lessee, and (vii) any other information which
Lessor or its mortgagee may reasonably require.

15.  DEFAULT BY LESSEE. If default be made in (a) the payment of the above rent,
or any part thereof and such default shall continue for ten (10) days after
written notice to Lessee; or (b) in any of the material covenants herein
contained to be kept by the Lessee and such default shall continue for thirty
(30) days after written notice to Lessee, Lessor may at any time, during the
continuation of such default, at his election, declare said term ended and
re-enter the Premises or any part thereof, with or (to the extent permitted by
law) without notice or process of law, and remove Lessee or any persons
occupying the same, without prejudice to any remedies which might otherwise be
used for arrears of rent, and Lessor shall have at all times the right to
distrain for rent due.

     No receipt of money by Lessor from Lessee after the expiration or
termination of this lease or after the service of any notice or after the
commencement of any suit, or after final judgment for

<PAGE>

possession of the Premises shall reinstate, continue or extend the Term of this
Lease or affect any such notice, demand or suit.

16.  INSURANCE. The Lessee, prior to entering upon the Demised Premises and
using the same for the purpose for which this Lease is granted, shall procure,
maintain and keep in force at Lessee's expense, public liability property damage
insurance in which the Lessor is named as an additional insured and fire and
extended coverage and all risk property insurance in which the Lessor is named
as the Loss Payee. Said insurance shall have policies with limits of not less
than:

                         COMPREHENSIVE GENERAL LIABILITY
                  Combined Single Limit Bodily Injury Liability
                            Property Damage Liability
                  in the amount of not less than $1,000,000.00

                           ALL RISK PROPERTY INSURANCE
                  in the amount of not less than $1,000,000.00

                           FIRE AND EXTENDED COVERAGE
         In an Amount Not Less Than the Replacement Cost of Improvements

     Prior to entering upon said Demised Premises, the Lessee shall furnish to
the Lessor certificates of such insurance or other suitable evidence that such
insurance coverage has been procured and is maintained in full force and effect.
Upon Lessor's written request, Lessee shall provide Lessor with copies of the
actual insurance policies within ten (10) days of Lessor's request for same.
Such certificates and insurance policies shall clearly identify the Demised
Premises and shall provide that no change, modification in or cancellation of
any insurance shall become effective until the expiration of thirty (30) days
after written notice thereof shall have been given by the insurance company to
the Lessor.

17.  ENVIRONMENTAL. The Lessee agrees that if at any future date it desires to
dispose of sewage, industrial wastes or other water-carried wastes from the
Premises, it will discharge the said sewage, industrial wastes or other
water-carried wastes into an intercepting sewer owned by or tributary to the
sewerage system of the Lessor. Lessee will make application and secure the
necessary permits from all governmental and regulatory agencies having
jurisdiction thereof before discharging any of the aforesaid industrial waste or
other hazardous wastes into any intercepting sewers.

     Lessee, for itself, its heirs, executors, administrators, successors and
assigns, covenants that to the extent that any hazardous materials are
manufactured, brought upon, placed, stored, transferred or distributed upon or
within the Premises by Lessee, or its subtenant or assigns, or

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any of their agents, servants, employees, contractors or subcontractors, same
shall be done in strict compliance with all environmental laws applicable now or
in the future to the Premises.

     Construction or installation of new or reconstruction of existing
underground storage tanks and underground interconnecting conveyance facilities
for any material or substance is not permitted without the advance written
consent of the Lessor.

     Lessee shall use the Premises only for purposes expressly authorized by
this Lease. Lessee will not do or permit any act that may impair the value of
the Premises or any part thereof or that could materially increase the dangers,
or pose an unreasonable risk of harm, to the health or safety of persons to
third parties (on or off the Premises) arising from activities thereon, or that
could cause or threaten to cause a public or private nuisance on the Premises or
use the Premises in any manner (i) which could cause the Premises to become a
hazardous waste treatment, storage, or disposal facility within the meaning of,
or otherwise bring the Premises within the ambit of, the Resource Conservation
and Recovery Act of 1976, Section 6901 et seq. of Title 42 of the United States
Code, or any similar state law or local ordinance, (ii) so as to cause a release
or threat of release of Hazardous Materials from the Premises within the meaning
of, or otherwise bring the Premises within the ambit of, the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, Section 9601 et
seq. of Title 42 of the United States Code, or any similar state law or local
ordinance or any other Environmental Law or (iii) so as to cause a discharge of
pollutants or effluents into any water source or system, or the discharge into
the air of any emissions, which would require a permit under the Federal Water
Pollution Control Act, Section 1251 of Title 33 of the United States Code, or
the Clean Air Act, Section 741 of Title 42 of the United States Code, or any
similar state law or local ordinance.

     In consideration of the execution and delivery of this Lease, the Lessee
indemnifies, exonerates, and holds the Lessor and its officers, officials,
directors, employees, and agents ("Indemnified Parties") free and harmless from
and against any and all actions, causes of action, suits, losses, costs,
liabilities and damages and expenses incurred in connection with any of these
(irrespective of whether any such Indemnified Party is a party to the action for
which indemnification is here sought), including reasonable attorney's fees,
costs and disbursements, incurred by the Indemnified Parties as a result of or
arising out of or relating to (i) the imposition of any governmental lien for
the recovery of environmental cleanup costs expended by reason of Lessee's
activities, or (ii) any investigation, litigation, or proceeding related to any
environmental response, audit, compliance, or other matter relating to the
protection of the environment by reason of Lessee's activities; or (iii) the
release or threatened release by Lessee, its subsidiaries, or its parent
company, of any hazardous materials, or the presence of hazardous materials on
or under the Premises as a result of Lessee's activities, or any property to
which the Lessee, its parent company or any of its subsidiaries has sent
hazardous materials (including any losses, liabilities, damages, injuries,
costs, expenses, or claims asserted or arising under any

<PAGE>

environmental law), regardless of whether caused by or within the control of the
Lessee, its parent company or its subsidiaries, provided that, to the extent
lessor is strictly liable under any environmental laws, Lessee's obligation to
Lessor under this indemnity shall be without regard to fault on the part of the
Lessee with respect to the violation of law by Lessee which results in liability
to Lessor.

     Lessee shall defend, indemnify, save and keep harmless the Indemnified
Parties against any loss, damage, cost, lien or expense which they may suffer,
incur or sustain or for which it may become liable, growing out of any injury to
or death of persons or loss or damage to property which shall at any time during
the term of this Lease be caused by or resulting from the migration of hazardous
materials from the Premises to adjacent properties which were caused by Lessee
or the result of Lessee's activities. In case any action, suit, proceeding or
investigation shall be commenced against one or more of the Indemnified Parties
growing out of any such loss, damage, cost or expense, the Lessee shall give
immediate written notice of the same to the Lessor, and Lessee shall attend to
the defense of the same and save and keep harmless the Indemnified Parties from
all expense, attorney's fees, costs, disbursements and liabilities in any manner
growing out of, pertaining to or connected therewith.

     In consideration of the execution and delivery of this Lease, the Lessor
indemnifies, exonerates, and holds the Lessee and its officers, officials,
directors, employees, and agents (the "Lessee Indemnified Parties") free and
harmless from and against any and all actions, cause of action, suits, losses,
costs, liabilities and damages and expenses incurred in connection with any of
those (irrespective of whether any such Lessee Indemnified Party is a party to
the actions for which indemnification is here sought), including reasonable
attorney's fees, costs and disbursements, incurred by the Lessee Indemnified
Parties as a result of or arising out of or relating to (i) the imposition of
any governmental lien for the recovery of environmental cleanup costs expended
by reason of Lessor's activities during the term hereof, or (ii) any
investigation, litigation, or proceeding related to any environmental response,
audit, compliance, or other matter relating to the protection of the environment
resulting from Lessor's activities during the term hereof, or (iii) the release
or threatened release by Lessor of any hazardous materials, or the presence as a
result of Lessor's activities of hazardous materials on or under the Premises
(including any losses, liabilities, damages, injuries, costs, expenses, or
claims asserted or arising under any environmental law).

     Lessor shall defend, indemnify, save and keep harmless the Lessee
Indemnified Parties against any loss, damage, cost, lien or expense which they
may suffer, incur or sustain or for which it may become liable, growing out of
any injury to or death of persons or loss or damage to property which shall at
any time during the term of this Lease be caused by or resulting from the
migration of hazardous materials from the Premises to adjacent properties which
were caused by Lessor or the result of Lessor's activities. In case any action,
suit, proceeding or investigation

<PAGE>

shall be commenced against one or more of the Lessee Indemnified Parties growing
out of any such loss, damage, cost or expense, the Lessor shall give immediate
written notice of the same to the Lessee, and Lessor shall attend to the defense
of the same and save all keep harmless the Lessee Indemnification Parties from
all expense, attorney's fees, costs, disbursement and liabilities in any manner
growing out of, pertaining to or connected therewith.

18.  NO RENT DEDUCTION OR SET OFF. Lessee's covenant to pay rent is and shall be
independent of each and every other covenant of this lease. Lessee agrees that
any claim by Lessee against Lessor shall not be deducted from rent nor set off
against any claim for rent in any action.

19.  RENT AFTER NOTICE OR SUIT. It is further agreed, by the parties hereto,
that after the service of notice or the commencement of a suit or after final
judgment for possession of the Premises, Lessor may receive and collect any rent
due, and the payment of said rent shall not waive or affect said notice, said
suit, or said judgment.

20.  PAYMENT OF COSTS. Lessee will pay and discharge all reasonable costs,
attorney's fees and expenses that shall be made and incurred by Lessor in
enforcing the covenants and agreements of this lease. In the event Lessor
commences any legal proceeding or action for the payment of rent, forcible
detainer or violation of the terms hereof, Lessee knowingly and voluntarily
waives any right to a jury trial and waives any right of, and agrees Lessee is
prohibited from, filing any counterclaims in such proceeding or action.

21.  RIGHTS CUMULATIVE. The rights and remedies of Lessor under this lease are
cumulative. The exercise or use of any one or more thereof shall not bar Lessor
from exercise or use of any other right or remedy provided herein or otherwise
provided by law, nor shall exercise nor use of any right or remedy by Lessor
waive any other right or remedy.

22.  FIRE AND CASUALTY. (a) If the whole of the Premises, or so much thereof,
including however, a portion of the buildings, structures and improvements,
shall be taken or condemned for a public or quasi-public use or purpose by any
competent authority, and as a result thereof the balance of the Premises cannot
be used for the same purpose as expressed in Section 3 hereof, then the term of
this Lease shall terminate when possession of the Premises shall be so taken and
surrendered, and any award, compensation or damages shall be paid to and be the
sole property of Lessor (except for that portion allocable to Lessee's
machinery, equipment, trade fixtures and personalty). If a material part of the
Premises shall be so taken or condemned, as determined by Lessee in its
reasonable discretion, Lessee shall have the option to terminate this Lease. If,
as a result of such partial condemnation, Lessee determines, in its reasonable
discretion, that the balance of the Premises can be used by Lessee for the same
purpose as expressed herein, then Lessee shall be entitled to have the rent,
additional rent, taxes and other obligations hereunder

<PAGE>

adjusted to reflect limitations in space available for Lessee's use and Lessor
shall be entitled to retain the entire award; provided, however, that Lessor
shall only be obligated to repair and restore the Premises and all buildings,
structures and improvements thereon to a complete architectural unit to the
extent of the amount of the award. (b) In the event of damage to or destruction
of an immaterial part of the buildings, structures or improvements located on
the Premises by fire, windstorm, or other casualty, and in which Lessor is
obligated under this Lease to repair, restore or rebuild, Lessor shall cause the
Premises to be repaired, restored or rebuilt with all reasonable dispatch. Any
insurance proceeds covering such fire, windstorm or other casualty shall be made
available to Lessor for such repair or restoration. In case the Premises shall
be rendered materially untenantable during the term of this lease by fire or
other casualty and such fire or casualty is not the result of Lessee's breach of
the Lease, Lessee shall have the option to either (i) terminate the Lease, in
which event insurance proceeds covering such casualty (excluding insurance
proceeds covering Lessee's machinery, equipment, trade fixtures and personal
property or as part of the recovery under a general casualty policy where a
specific portion of such proceeds is allocable to such property of Lessee) shall
be paid to Lessor, or (ii) elect to have the sum of insurance proceeds covering
such casualty made available to Lessor for the reconstruction or repair of any
building, structure or improvement so damaged or destroyed; provided, however,
                                                            --------  -------
that if the amount of proceeds shall be insufficient for the reconstruction or
repair and refurnishing of any building or structure damaged or destroyed, as
aforesaid, Lessor shall not be obligated to make such repairs or reconstruction
unless Lessee provides Lessor with the proceeds needed to account for the
deficiency. In the event of damage or destruction to the Premises as described
in the aforementioned sentence, Lessee shall be entitled to have the rent,
additional rent, real estate taxes and other obligations of Lessee hereunder
adjusted to reflect the limitations in space available for Lessee's use
thereafter. If this lease is terminated by reason of fire or casualty as herein
specified, rent shall be apportioned and paid to the day of such fire or
casualty. Notwithstanding the foregoing, nothing in this paragraph shall
prevent, prohibit or anyway limit Lessor's ability under the law to recover from
Lessee any and all damage or loss it sustains as a result such fire or other
casualty.

23.  MODIFICATIONS. Lessee, at its own expense, may make, without Lessor's
consent, any addition to or alteration, modification or rearrangement
(collectively referred to below as "modifications") of the Premises; provided,
                                                                     --------
however, that such modification shall not affect the structural integrity of the
-------
building. Upon termination or expiration of this Lease and upon the request of
Lessor, the Premises, as regards nonstructural modifications, shall be returned
to its original condition, less ordinary wear and tear. Modifications affecting
the structural integrity of the building may not be made by Lessee without the
prior written consent of Lessor, which consent shall not be unreasonably
withheld. If Lessee desires to make such a modification, notice of the type of
proposed action shall be delivered to Lessor at least sixty (60) days prior to
the contemplated commencement of such action. Within forty-five (45) days of
receipt by Lessor of the aforesaid notice from Lessee, Lessor shall by written
notice to Lessee state whether Lessor

<PAGE>

consents to such action. Lessee shall, at the termination or expiration of the
Lease, return the Premises, with regard to that particular modification, to the
original condition, less ordinary wear and tear, unless Lessor advises Lessee in
writing at the termination or expiration of the Lease that Lessee need not
return the Premises to its original condition. If Lessor fails to respond to
Lessee's notice within such forty-five (45) day period, Lessor shall be deemed
to have not consented to such structural modification. In all events, Lessee
shall have the right to remove any structural modification as it sees fit, as
long as such removal does not materially harm or deteriorate the structure any
less than its original condition. Lessee shall keep the Premises free from any
liens arising out of any work performed, materials furnished or obligations
incurred by Lessee. In addition to the possible installation of modifications
and removal thereof by Lessee, it is agreed that all personal property,
mechanical tools, trade fixtures and like items may be installed and removed as
Lessee sees fit, always returning the Premises to the condition prior to
installation of such property, tools, trade fixtures or like items. Lessee, at
its sole cost, may place signs on the Premises; provided, however, that such
                                                --------  -------
signs shall be of a size and in such design as shall be approved by Lessor,
whose consent shall not be unreasonably withheld or delayed. Lessee, at its sole
cost, shall obtain such permits and approvals as may be necessary from any
governmental bodies.

24.  SUBORDINATION. This lease is subordinate to all mortgages which may now or
hereafter affect the Premises and which provide lending or financing for the
benefit of Lessor.

25.  PLURALS; SUCCESSORS. The words "Lessor" and "Lessee" wherever herein
occurring and used shall be construed to mean "Lessors" and "Lessees" in case
more than one person constitutes either party to this lease and all the
covenants and agreements contained shall be binding upon, and inure to, their
respective successors, heirs, executors, administrators and assigns and may be
exercised by his or their attorney or agent.

26.  SEVERABILITY. Wherever possible each provision of this lease shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this lease shall be prohibited by or invalid under
applicable law, such provision shall be ineffective to the extent of such
prohibition or invalidity, without invalidating the remainder of such provision
or the remaining provisions of this lease.

If this instrument is executed by a corporation, such execution has been
authorized by a duly adopted resolution of the Board of Directors of such
corporation.

     This lease consists of thirteen pages (plus the attached Schedule 1)
numbered 1 to 13.

<PAGE>

                                   SCHEDULE 1

Monthly Rent- December 19, 1999 through November 18, 2000: $13,189.58.
Monthly Tax Charges-November 19, 1999 through November 18, 2000: $5,681.67.

Monthly Rent-November 19, 2000 through November 18, 2001: $13,453.38.
Monthly Tax Charges-November 19, 2000 through November 18, 2001: $5,795.30.

Monthly Rent-November 19, 2001 through November 18, 2002: $13,722.44.
Monthly Tax Charges-November 19, 2001 through November 18, 2002: $5,911.21.

<PAGE>

IN WITNESS WHEREOF, the parties hereto have executed this instrument this day
and year first above written.

6501 Corporation                               Packaging Dynamics, L.L.C.

By: _______________________________            By: /s/ T. S. Ellsworth
                                                   -----------------------------

Print:_____________________________            Print: T. S. Ellsworth
                                                      --------------------------

Title:_____________________________            Title: President
                                                      --------------------------<PAGE>

                                                                   Exhibit 10.16

(Multicurrency - Cross Border)

                                     ISDA(R)
                  International Swap Dealers Association, Inc.

                                MASTER AGREEMENT
                            dated as of May 16, 2001

BANK OF AMERICA, N.A.                  and       PACKAGING DYNAMICS, L.L.C.
have entered and/or anticipate entering into one or more transactions (each a
"Transaction") that are or will be governed by this Master Agreement, which
includes the schedule (the "Schedule"), and the documents and other confirming
evidence (each a "Confirmation") exchanged between the parties confirming those
Transactions.

Accordingly, the parties agree as follows:

1.   Interpretation

(a)  Definitions. The terms defined in Section 14 and in the Schedule will have
the meanings therein specified for the purpose of this Master Agreement.

(b)  Inconsistency. In the event of any inconsistency between the provisions of
the Schedule and the other provisions of this Master Agreement, the Schedule
will prevail. In the event of any inconsistency between the provisions of any
Confirmation and this Master Agreement (including the Schedule), such
Confirmation will prevail for the purpose of the relevant Transaction.

(c)  Single Agreement. All Transactions are entered into in reliance on the fact
that this Master Agreement and all Confirmations form a single agreement between
the parties (collectively referred to as this "Agreement"), and the parties
would not otherwise enter into any Transactions.

2.   Obligations

(a)  General Conditions.

     (i)  Each party will make each payment or delivery specified in each
     Confirmation to be made by it, subject to the other provisions of this
     Agreement.

     (ii)  Payments under this Agreement will be made on the due date for value
     on that date in the place of the account specified in the relevant
     Confirmation or otherwise pursuant to this Agreement, in freely
     transferable funds and in the manner customary for payments in the required
     currency. Where settlement is by delivery (that is, other than by payment),
     such delivery will be made for receipt on the due date in the manner
     customary for the relevant obligation unless otherwise specified in the
     relevant Confirmation or elsewhere in this Agreement.

     (iii)  Each obligation of each party under Section 2(a)(i) is subject to
     (1) the condition precedent that no Event of Default or Potential Event of
     Default with respect to the other party has occurred and is continuing, (2)
     The condition precedent that no Early Termination Date in respect of the
     relevant Transaction has occurred or been effectively designated and (3)
     each other applicable condition precedent specified in this Agreement.

<PAGE>

(b)  Change of Account. Either party may change its account for receiving a
payment or delivery by giving notice to the other party at least five Local
Business Days prior to the scheduled date for the payment or delivery to which
such change applies unless such other party gives timely notice of a reasonable
objection to such change.

(c)  Netting. If on any date amounts would otherwise be payable:

     (i)  in the same currency; and

     (ii)  in respect of the same Transaction,

by each party to the other, then, on such date, each party's obligation to make-
payment of any such amount will be automatically satisfied and discharged and,
if the aggregate amount that would otherwise have been payable by one party
exceeds the aggregate amount that would otherwise have been payable by the other
party, replaced by an obligation upon the party by whom the larger aggregate
amount would have been payable to pay to the other party the excess of the
larger aggregate amount over the smaller aggregate amount.

The parties may elect in respect of two or more Transactions that a net amount
will be determined in respect of all amounts payable on the same date in the
same currency in respect of such Transactions, regardless of whether such
amounts are payable in respect of the same Transaction. The election may be made
in the Schedule or a Confirmation by specifying that subparagraph (ii) above
will not apply to the Transactions identified as being subject to the election,
together with the starting date (in which case subparagraph (ii) above will not,
or will cease to, apply to such Transactions from such date). This election may
be made separately for different groups of Transactions and will apply
separately to each pairing of Offices through which the parties make and receive
payments or deliveries.

(d)  Deduction or Withholding for Tax

     (i)  Gross-Up. All payments under this Agreement will be made without any
     deduction or withholding for or on account of any Tax unless such deduction
     or withholding is required by any applicable law, as modified by the
     practice of any relevant governmental revenue authority, then in effect. If
     a party is so required to deduct or withhold, then that party ("X") will:
     --

          (1)  promptly notify the other party ("Y") of such requirement;

          (2)  pay to the relevant authorities the full amount required to be
          deducted or withheld (including the full amount required to be
          deducted or withheld from any additional amount paid by X to Y under
          this Section 2(d)) promptly upon the earlier of determining that such
          deduction or withholding is required or receiving notice that such
          amount has been assessed against Y;

          (3)  promptly forward to Y an official receipt (or a certified copy),
          or other documentation reasonably acceptable to Y evidencing such
          payment to such authorities; and

          (4)  if such Tax is an Indemnifiable Tax, pay to Y, in addition to the
          payment to which Y is otherwise entitled under this Agreement, such
          additional amount as is necessary to ensure that the net amount
          actually received by Y (free and clear of Indemnifiable Taxes, whether
          assessed against X or Y) will equal the full amount Y would have
          received had no such deduction or withholding been required. However,
          X will not be required to pay any additional amount to Y to the extent
          that it would not be required to be paid but for: --

               (A)  the failure by Y to comply with or perform any agreement
               contained in Section 4(a)(i), 4(a)(iii) or 4(d); or

<PAGE>

               (B)  the failure of a representation made by Y pursuant to
               Section 3(f) to be accurate and true unless such failure would
               not have occurred but for (I) any action taken by a taxing
               authority, or brought in a court of competent jurisdiction, on or
               after the date on which a Transaction is entered into (regardless
               of whether such action is taken or brought with respect to a
               party to this Agreement) or (II) a Change in Tax Law.

     (ii)  Liability.  If: --

          (1)  X is required by any applicable law, as modified by the practice
          of any relevant governmental revenue authority, to make any deduction
          or withholding in respect of which X would not be required to pay an
          additional amount to Y under Section 2(d)(i)(4);

          (2)  X does not so deduct or withhold; and

          (3)  a liability resulting from such Tax is assessed directly against
          X,

     then, except to the extent Y has satisfied or then satisfies the liability
     resulting from such Tax, Y will promptly pay to X the amount of such
     liability (including any related liability for interest, but including any
     related liability for penalties only if Y has failed to comply with or
     perform any agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d)).

(e)  Default Interest; Other Amounts. Prior to the occurrence or effective
designation of an Early Termination Date in respect of the relevant Transaction,
a party that defaults in the performance of any payment obligation will, to the
extent permitted by law and subject to Section 6(c), be required to pay interest
(before as well as after judgment) on the overdue amount to the other party on
demand in the same currency as such overdue amount, for the period from (and
including) the original due date for payment to (but excluding) the date of
actual payment, at the Default Rate. Such interest will be calculated on the
basis of daily compounding and the actual number of days elapsed. If, prior to
the occurrence or effective designation of an Early Termination Date in respect
of the relevant Transaction, a party defaults in the performance of any
obligation required to be settled by delivery, it will compensate the other
party on demand if and to the extent provided for in the relevant Confirmation
or elsewhere in this Agreement.

3.   Representations

Each party represents to the other party (which representations will be deemed
to be repeated by each party on each date on which a Transaction is entered into
and, in the case of the representations in Section 3(f), at all times until the
termination of this Agreement) that:

(a)  Basic Representations.

     (i)  Status. It is duly organised and validly existing under the laws of
     the jurisdiction of its organisation or incorporation and, if relevant
     under such laws, in good standing;

     (ii)  Powers. It has the power to execute this Agreement and any other
     documentation relating to this Agreement to which it is a party, to deliver
     this Agreement and any other documentation relating to this Agreement that
     it is required by this Agreement to deliver and to perform its obligations
     under this Agreement and any obligations it has under any Credit Support
     Document to which it is a party and has taken all necessary action to
     authorise such execution, delivery and performance;

     (iii)  No Violation or Conflict. Such execution, delivery and performance
     do not violate or conflict with any law applicable to it, any provision of
     its constitutional documents, any order or judgment of any court or

<PAGE>

     other agency of government applicable to it or any of its assets or any
     contractual restriction binding on or affecting it or any of its assets;

     (iv)  Consents. All governmental and other consents that are required to
     have been obtained by it with respect to this Agreement or any Credit
     Support Document to which it is a party have been obtained and are in full
     force and effect and all conditions of any such consents have been complied
     with; and

     (v)  Obligations Binding. Its obligations under this Agreement and any
     Credit Support Document to which it is a party constitute its legal, valid
     and binding obligations, enforceable in accordance with their respective
     terms (subject to applicable bankruptcy, reorganisation, insolvency,
     moratorium or similar laws affecting creditors' rights generally and
     subject, as to enforceability, to equitable principles of general
     application (regardless of whether enforcement is sought in a proceeding in
     equity or at law)).

(b)  Absence of Certain Events. No Event of Default or Potential Event of
Default or, to its knowledge, Termination Event with respect to it has occurred
and is continuing and no such event or circumstance would occur as a result of
its entering into or performing its obligations under this Agreement or any
Credit Support Document to which it is a party.

(c)  Absence of Litigation. There is not pending or, to its knowledge,
threatened against it or any of its Affliates any action, suit or proceeding at
law or in equity or before any court, tribunal, governmental body, agency or
official or any arbitrator that is likely to affect the legality, validity or
enforceability against it of this Agreement or any Credit Support Document to
which it is a party or its ability to perform its obligations under this
Agreement or such Credit Support Document.

(d)  Accuracy of Specified Information. All applicable information that is
furnished in writing by or on behalf of it to the other party and is identified
for the purpose of this Section 3(d) in the Schedule is, as of the date of the
information, true, accurate and complete in every material respect.

(e)  Payer Tax Representation. Each representation specified in the Schedule as
being made by it for the purpose of this Section 3(e) is accurate and true.

(f)  Payee Tax Representations. Each representation specified in the Schedule as
being made by it for the purpose of this Section 3(f) is accurate and true.

4.   Agreements

Each party agrees with the other that, so long as either party has or may have
any obligation under this Agreement or under any Credit Support Document to
which it is a party:

(a)  Furnish Specified Information. It will deliver to the other party or, in
certain cases under subparagraph (iii) below, to such government or taxing
authority as the other party reasonably directs:

     (i)  any forms, documents or certificates relating to taxation specified in
     the Schedule or any Confirmation;

     (ii)  any other documents specified in the Schedule or any Confirmation;
     and

     (iii)  upon reasonable demand by such other party, any form or document
     that may be required or reasonably requested in writing in order to allow
     such other party or its Credit Support Provider to make a payment under
     this Agreement or any applicable Credit Support Document without any
     deduction or withholding for or on account of any Tax or with such
     deduction or withholding at a reduced rate (so long as the completion,
     execution or submission of such form or document would not materially
     prejudice the legal or commercial

<PAGE>

     position of the party in receipt of such demand), with any such form or
     document to be accurate and completed in a manner reasonably satisfactory
     to such other party and to be executed and to be delivered with any
     reasonably required certification,

in each case by the date specified in the Schedule or such Confirmation or, if
none is specified, as soon as reasonably practicable.

(b)  Maintain Authorisations. It will use all reasonable efforts to maintain in
full force and effect all consents of any governmental or other authority that
are required to be obtained by it with respect to this Agreement or any Credit
Support Document to which it is a party and will use all reasonable efforts to
obtain any that may become necessary in the future.

(c)  Comply with Laws. It will comply in all material respects with all
applicable laws and orders to which it may be subject if failure so to comply
would materially impair its ability to perform its obligations under this
Agreement or any Credit Support Document to which it is a party.

(d)  Tax Agreement. It will give notice of any failure of a representation made
by it under Section 3(f) to be accurate and true promptly upon learning of such
failure.

(e)  Payment of Stamp Tax. Subject to Section 11, it will pay any Stamp Tax
levied or imposed upon it or in respect of its execution or performance of this
Agreement by a jurisdiction in which it is incorporated, organised, managed and
controlled, or considered to have its seat, or in which a branch or office
through which it is acting for the purpose of this Agreement is located ("Stamp
Tax Jurisdiction") and will indemnify the other party against any Stamp Tax
levied or imposed upon the other party or in respect of the other party's
execution or performance of this Agreement by any such Stamp Tax Jurisdiction
which is not also a Stamp Tax Jurisdiction with respect to the other party.

5.   Events of Default and Termination Events

(a)  Events of Default. The occurrence at any time with respect to a party or,
if applicable, any Credit Support Provider of such party or any Specified Entity
of such party of any of the following events constitutes an event of default (an
"Event of Default") with respect to such party:

     (i)  Failure to Pay or Deliver. Failure by the party to make, when due, any
     payment under this Agreement or delivery under Section 2(a)(i) or 2(e)
     required to be made by it if such failure is not remedied on or before the
     third Local Business Day after notice of such failure is given to the
     party;

     (ii)  Breach of Agreement. Failure by the party to comply with or perform
     any agreement or obligation (other than an obligation to make any payment
     under this Agreement or delivery under Section 2(a)(i) or 2(e) or to give
     notice of a Termination Event or any agreement or obligation under Section
     4(a)(i), 4(a)(iii) or 4(d)) to be complied with or performed by the party
     in accordance with this Agreement if such failure is not remedied on or
     before the thirtieth day after notice of such failure is given to the
     party;

     (iii)  Credit Support Default.

          (1)  Failure by the party or any Credit Support Provider of such party
          to comply with or perform any agreement or obligation to be complied
          with or performed by it in accordance with any Credit Support Document
          if such failure is continuing after any applicable grace period has
          elapsed;

          (2)  the expiration or termination of such Credit Support Document or
          the failing or ceasing of such Credit Support Document to be in full
          force and effect for the purpose of this Agreement (in either case
          other than in accordance with its terms) prior to the satisfaction of
          all obligations of such

<PAGE>

          party under each Transaction to which such Credit Support Document
          relates without the written consent of the other party; or

          (3)  the party or such Credit Support Provider disaffirms, disclaims,
          repudiates or rejects, in whole or in part, or challenges the validity
          of, such Credit Support Document;

     (iv)  Misrepresentation. A representation (other than a representation
     under Section 3(e) or (f)) made or repeated or deemed to have been made or
     repeated by the party or any Credit Support Provider of such party in this
     Agreement or any Credit Support Document proves to have been incorrect or
     misleading in any material respect when made or repeated or deemed to have
     been made or repeated;

     (v)  Default under Specified Transaction. The party, any Credit Support
     Provider of such party or any applicable Specified Entity of such party (1)
     defaults under a Specified Transaction and, after giving effect to any
     applicable notice requirement or grace period, there occurs a liquidation
     of, an acceleration of obligations under, or an early termination of, that
     Specified Transaction, (2) defaults, after giving effect to any applicable
     notice requirement or grace period, in making any payment or delivery due
     on the last payment, delivery or exchange date of, or any payment on early
     termination of, a Specified Transaction (or such default continues for at
     least three Local Business Days if there is no applicable notice
     requirement or grace period) or (3) disaffirms, disclaims, repudiates or
     rejects, in whole or in part, a Specified Transaction (or such action is
     taken by any person or entity appointed or empowered to operate it or act
     on its behalf);

     (vi)  Cross Default. If "Cross Default" is specified in the Schedule as
     applying to the party, the occurrence or existence of (1) a default, event
     of default or other similar condition or event (however described) in
     respect of such party, any Credit Support Provider of such party or any
     applicable Specified Entity of such party under one or more agreements or
     instruments relating to Specified Indebtedness of any of them (individually
     or collectively) in an aggregate amount of not less than the applicable
     Threshold Amount (as specified in the Schedule) which has resulted in such
     Specified Indebtedness becoming, or becoming capable at such time of being
     declared, due and payable under such agreements or instruments, before it
     would otherwise have been due and payable or (2) a default by such party,
     such Credit Support Provider or such Specified Entity (individually or
     collectively) in making one or more payments on the due date thereof in an
     aggregate amount of not less than the applicable Threshold Amount under
     such agreements or instruments (after giving effect to any applicable
     notice requirement or grace period);

     (vii)  Bankruptcy. The party, any Credit Support Provider of such party or
     any applicable Specified Entity of such party:

          (1)  is dissolved (other than pursuant to a consolidation,
          amalgamation or merger); (2) becomes insolvent or is unable to pay its
          debts or fails or admits in writing its inability generally to pay its
          debts as they become due; (3) makes a general assignment, arrangement
          or composition with or for the benefit of its creditors; (4)
          institutes or has instituted against it a proceeding seeking a
          judgment of insolvency or bankruptcy or any other relief under any
          bankruptcy or insolvency law or other similar law affecting creditors'
          rights, or a petition is presented for its winding-up or liquidation,
          and, in the case of any such proceeding or petition instituted or
          presented against it, such proceeding or petition (A) results in a
          judgment of insolvency or bankruptcy or the entry of an order for
          relief or the making of an order for its winding-up or liquidation or
          (B) is not dismissed, discharged, stayed or restrained in each case
          within 30 days of the institution or presentation thereof; (5) has a
          resolution passed for its winding-up, official management or
          liquidation (other than pursuant to a consolidation, amalgamation or
          merger); (6) seeks or becomes subject to the appointment of an
          administrator, provisional liquidator, conservator, receiver, trustee,
          custodian or other similar official for it or for all or substantially
          all its assets; (7) has a secured party take possession of all or
          substantially all its assets or has a distress, execution, attachment,
          sequestration or other legal process levied, enforced or sued on

<PAGE>

          or against all or substantially all its assets and such secured party
          maintains possession, or any such process is not dismissed,
          discharged, stayed or restrained, in each case within 30 days
          thereafter; (8) causes or is subject to any event with respect to it
          which, under the applicable laws of any jurisdiction, has an analogous
          effect to any of the events specified in clauses (1) to (7)
          (inclusive); or (9) takes any action in furtherance of, or indicating
          its consent to, approval of, or acquiescence in, any of the foregoing
          acts; or

     (viii)  Merger Without Assumption. The party or any Credit Support Provider
     of such party consolidates or amalgamates with, or merges with or into, or
     transfers all or substantially all its assets to, another entity and, at
     the time of such consolidation, amalgamation, merger or transfer: --

          (1)  the resulting, surviving or transferee entity fails to assume all
          the obligations of such party or such Credit Support Provider under
          this Agreement or any Credit Support Document to which it or its
          predecessor was a party by operation of law or pursuant to an
          agreement reasonably satisfactory to the other party to this
          Agreement; or

          (2)  the benefits of any Credit Support Document fail to extend
          (without the consent of the other party) to the performance by such
          resulting, surviving or transferee entity of its obligations under
          this Agreement.

(b)  Termination Events. The occurrence at any time with respect to a party or,
if applicable, any Credit Support Provider of such party or any Specified Entity
of such party of any event specified below constitutes an Illegality if the
event is specified in (i) below, a Tax Event if the event is specified in (ii)
below or a Tax Event Upon Merger if the event is specified in (iii) below, and,
if specified to be applicable, a Credit Event Upon Merger if the event is
specified pursuant to (iv) below or an Additional Termination Event if the event
is specified pursuant to (v) below:

     (i)  Illegality. Due to the adoption of, or any change in, any applicable
     law after the date on which a Transaction is entered into, or due to the
     promulgation of, or any change in, the interpretation by any court tribunal
     or regulatory authority with competent jurisdiction of any applicable law
     after such date, it becomes unlawful (other than as a result of a breach by
     the party of Section 4(b)) for such party (which will be the Affected
     Party):

          (1)  to perform any absolute or contingent obligation to make a
          payment or delivery or to receive a payment or delivery in respect of
          such Transaction or to comply with any other material provision of
          this Agreement relating to such Transaction; or

          (2)  to perform, or for any Credit Support Provider of such party to
          perform, any contingent or other obligation which the party (or such
          Credit Support Provider) has under any Credit Support Document
          relating to such Transaction;

     (ii)  Tax Event. Due to (x) any action taken by a taxing authority, or
     brought in a court of competent jurisdiction, on or after the date on which
     a Transaction is entered into (regardless of whether such action is taken
     or brought with respect to a party to this Agreement) or (y) a Change in
     Tax Law, the party (which will be the Affected Party) will, or there is a
     substantial likelihood that it will, on the next succeeding Scheduled
     Payment Date (1) be required to pay to the other party an additional amount
     in respect of an Indemnifiable Tax under Section 2(d)(i)(4) (except in
     respect of interest under Section 2(e), 6(d)(ii) or 6(e)) or (2) receive a
     payment from which an amount is required to be deducted or withheld for or
     on account of a Tax (except in respect of interest under Section 2(e),
     6(d)(ii) or 6(e)) and no additional amount is required to be paid in
     respect of such Tax under Section 2(d)(i)(4) (other than by reason of
     Section 2(d)(i)(4)(A) or (B));

<PAGE>

     (iii) Tax Event Upon Merger. The party (the "Burdened Party") on the next
     succeeding Scheduled Payment Date will either (1) be required to pay an
     additional amount in respect of an Indemnifiable Tax under Section
     2(d)(i)(4) (except in respect of interest under Section 2(e), 6(d)(ii) or
     6(e)) or (2) receive a payment from which an amount has been deducted or
     withheld for or on account of any Indemnifiable Tax in respect of which the
     other party is not required to pay an additional amount (other than by
     reason of Section 2(d)(i)(4)(A) or (B)), in either case as a result of a
     party consolidating or amalgamating with, or merging with or into, or
     transferring all or substantially all its assets to, another entity (which
     will be the Affected Party) where such action does not constitute an event
     described in Section 5(a)(viii);

     (iv) Credit Event Upon Merger. If "Credit Event Upon Merger" is specified
     in the Schedule as applying to the party, such party ("X"), any Credit
     Support Provider of X or any applicable Specified Entity of X consolidates
     or amalgamates with, or merges with or into, or transfers all or
     substantially all its assets to, another entity and such action does not
     constitute an event described in Section 5(a)(viii) but the
     creditworthiness of the resulting, surviving or transferee entity is
     materially weaker than that of X, such Credit Support Provider or such
     Specified Entity, as the case may be, immediately prior to such action
     (and, in such event, X or its successor or transferee, as appropriate, will
     be the Affected Party); or

     (v) Additional Termination Event. If any "Additional Termination Event" is
     specified in the Schedule or any Confirmation as applying, the occurrence
     of such event (and, in such event, the Affected Party or Affected Parties
     shall be as specified for such Additional Termination Event in the Schedule
     or such Confirmation).

(c)  Event of Default and Illegality. If an event or circumstance which would
otherwise constitute or give rise to an Event of Default also constitutes an
Illegality, it will be treated as an Illegality and will not constitute an Event
of Default.

6.   Early Termination

(a)  Right to Terminate Following Event of Default. If at any time an Event of
Default with respect to a party (the "Defaulting Party") has occurred and is
then continuing, the other party (the "Non-defaulting Party") may, by not more
than 20 days notice to the Defaulting Party specifying the relevant Event of
Default, designate a day not earlier than the day such notice is effective as an
Early Termination Date in respect of all outstanding Transactions. If, however,
"Automatic Early Termination" is specified in the Schedule as applying to a
party, then an Early Termination Date in respect of all outstanding Transactions
will occur immediately upon the occurrence with respect to such party of an
Event of Default specified in Section 5(a)(vii)(1), (3), (5), (6) or, to the
extent analogous thereto, (8), and as of the time immediately preceding the
institution of the relevant proceeding or the presentation of the relevant
petition upon the occurrence with respect to such party of an Event of Default
specified in Section 5(a)(vii)(4) or, to the extent analogous thereto, (8).

(b)  Right to Terminate Following Termination Event

     (i) Notice. If a Termination Event occurs, an Affected Party will, promptly
     upon becoming aware of it, notify the other party, specifying the nature of
     that Termination Event and each Affected Transaction and will also give
     such other information about that Termination Event as the other party may
     reasonably require.

     (ii) Transfer to Avoid Termination Event. If either an Illegality under
     Section 5(b)(i)(1) or a Tax Event occurs and there is only one Affected
     Party, or if a Tax Event Upon Merger occurs and the Burdened Party is the
     Affected Party, the Affected Party will, as a condition to its right to
     designate an Early Termination Date under Section 6(b)(iv), use all
     reasonable efforts (which will not require such party to incur a loss,
     excluding immaterial, incidental expenses) to transfer within 20 days after
     it gives notice under Section 6(b)(i) all its rights and obligations under
     this Agreement in respect of the Affected Transactions to another of its
     Offices or Affiliates so that such Termination Event ceases to exist.

<PAGE>

     If the Affected Party is not able to make such a transfer it will give
     notice to the other party to that effect within such 20 day period,
     whereupon the other party may effect such a transfer within 30 days after
     the notice is given under Section 6(b)(i).

     Any such transfer by a party under this Section 6(b)(ii) will be subject to
     and conditional upon the prior written consent of the other party, which
     consent will not be withheld, if such other party's policies in effect at
     such time would permit it to enter into transactions with the transferee on
     the terms proposed.

     (iii)  Two Affected Parties. If an Illegality under section 5(b)(i)(1) or a
          Tax Event occurs and there are two Affected Parties, each party will
          use all reasonable efforts to reach agreement within 30 days after
          notice thereof is given under Section 6(b)(i) on action to avoid that
          Termination Event.

     (iv)  Right to Terminate. If:

          (1) a transfer under Section 6(b)(ii) or an agreement under Section
          6(b)(iii), as the case may be, has not been effected with respect to
          all Affected Transactions within 30 days after an Affected Party gives
          notice under Section 6(b)(i); or

          (2) an Illegality under Section 5(b)(i)(2), a Credit Event Upon Merger
          or an Additional Termination Event occurs, or a Tax Event Upon Merger
          occurs and the Burdened Party is not the Affected Party,

     either party in the case of an Illegality, the Burdened Party in the case
     of a Tax Event Upon Merger, any Affected Party in the case of a Tax Event
     or an Additional Termination Event if there is more than one Affected
     Party, or the party which is not the Affected Party in the case of a Credit
     Event Upon Merger or an Additional Termination Event if there is only one
     Affected Party may, by not more than 20 days notice to the other party and
     provided that the relevant Termination Event is then continuing, designate
     a day not earlier than the day such notice is effective as an Early
     Termination Date in respect of all Affected Transactions.

(c)  Effect of Designation.

     (i)  If notice designating an Early Termination Date is given under Section
     6(a) or (b), the Early Termination Date will occur on the date so
     designated, whether or not the relevant Event of Default or Termination
     Event is then continuing.

     (ii)  Upon the occurrence or effective designation of an Early Termination
     Date, no further payments or deliveries under Section 2(a)(i) or 2(e) in
     respect of the Terminated Transactions will be required to be made, but
     without prejudice to the other provisions of this Agreement. The amount, if
     any, payable in respect of an Early Termination Date shall be determined
     pursuant to Section 6(e).

(d)  Calculations.

     (i)  Statement. On or as soon as reasonably practicable following the
     occurrence of an Early Termination Date, each party will make the
     calculations on its part, if any, contemplated by Section 6(e) and will
     provide to the other party a statement (1) showing, in reasonable detail,
     such calculations (including all relevant quotations and specifying any
     amount payable under Section 6(e)) and (2) giving details of the relevant
     account to which any amount payable to it is to be paid. In the absence of
     written confirmation from the source of a quotation obtained in determining
     a Market Quotation, the records of the party obtaining such quotation will
     be conclusive evidence of the existence and accuracy of such quotation.

<PAGE>

     (ii)  Payment Date. An amount calculated as being due in respect of any
     Early Termination Date under. Section 6(e) will be payable on the day that
     notice of the amount payable is effective (in the case of an Early
     Termination Date which is designated or occurs as a result of an Event of
     Default) and on the day which is two Local Business Days after the day on
     which notice of the amount payable is effective (in the case of an Early
     Termination Date which is designated as a result of a Termination Event).
     Such amount will be paid together with (to the extent permitted under
     applicable law) interest thereon (before as well as after judgment) in the
     Termination Currency, from (and including) the relevant Early Termination
     Date to (but excluding) the date such amount is paid, at the Applicable
     Rate. Such interest will be calculated on the basis of daily compounding
     and the actual number of days elapsed.

(e)  Payments on Early Termination. If an Early Termination Date occurs, the
following provisions shall apply based on the parties' election in the Schedule
of a payment measure, either "Market Quotation" or "Loss", and a payment method,
either the "First Method" or the "Second Method". If the parties fail to
designate a payment measure or payment method in the Schedule, it will be deemed
that "Market Quotation" or the "Second Method", as the case may be, shall apply.
The amount, if any, payable in respect of an Early Termination Date and
determined pursuant to this Section will be subject to any Set-off.

     (i)  Events of Default. If the Early Termination Date results from an Event
          of Default:

          (1)  First Method and Market Quotation. If the First Method and Market
          Quotation apply, the Defaulting Party will pay to the Non-defaulting
          Party the excess, if a positive number, of (A) the sum of the
          Settlement Amount (determined by the Non-defaulting Party) in respect
          of the Terminated Transactions and the Termination Currency Equivalent
          of the Unpaid Amounts owing to the Non-defaulting Party over (B) the
          Termination Currency Equivalent of the Unpaid Amounts owing to the
          Defaulting Party.

          (2)  First Method and Loss. If the First Method and Loss apply, the
          Defaulting Party will pay to the Non-defaulting Party, if a positive
          number, the Non-defaulting Party's Loss in respect of this Agreement.

          (3)  Second Method and Market Quotation. If the Second Method and
          Market Quotation apply, an amount will be payable equal to (A) the sum
          of the Settlement Amount (determined by the Non-defaulting Party) in
          respect of the Terminated Transactions and the Termination Currency
          Equivalent of the Unpaid Amounts owing to the Non-defaulting Party
          less (B) the Termination Currency Equivalent of the Unpaid Amounts
          owing to the Defaulting Party. If that amount is a positive number,
          the Defaulting Party will pay it to the Non-defaulting Party; if it is
          a negative number, the Non-defaulting Party will pay the absolute
          value of that amount to the Defaulting Party.

          (ii)  Second Method and Loss. If the Second Method and Loss apply, an
          amount will be payable equal to the Non-defaulting Party's Loss in
          respect of this Agreement. If that amount is a positive number, the
          Defaulting Party will pay it to the Non-defaulting Party; if it is a
          negative number, the Non-defaulting Party will pay the absolute value
          of that amount to the Defaulting Party.

     (ii) Termination Events. If the Early Termination Date results from a
          Termination Event:

          (1)  One Affected Party. If there is one Affected Party, the amount
          payable will be determined in accordance with Section 6(e)(i)(3), if
          Market Quotation applies, or Section 6(e)(i)(4), if Loss applies,
          except that, in either case, references to the Defaulting Party and to
          the Non-defaulting Party will be deemed to be references to the
          Affected Party and the party which is not the Affected Party,
          respectively, and, if Loss applies and fewer than all the Transactions
          are being terminated, Loss shall be calculated in respect of all
          Terminated Transactions.

<PAGE>

          (2)  Two Affected Parties. If there are two Affected Parties:

               (A) if Market Quotation applies, each party will determine a
               Settlement Amount in respect of the Terminated Transactions, and
               an amount will be payable equal to (I) the sum of (a) one-half of
               the difference between the Settlement Amount of the party with
               the higher Settlement Amount ("X") and the Settlement Amount of
               the party with the lower Settlement Amount ("Y") and (b) the
               Termination Currency Equivalent of the Unpaid Amounts owing to X
               less (II) the Termination Currency Equivalent of the Unpaid
               Amounts owing to Y; and

               (B) if Loss applies, each party will determine its Loss in
               respect of this Agreement (or, if fewer than all the Transactions
               are being terminated, in respect of all Terminated Transactions)
               and an amount will be payable equal to one-half of the difference
               between the Loss of the party with the higher Loss ("X") and the
               Loss of the party with the lower Loss ("Y").

          If the amount payable is a positive number, Y will pay it to X; if it
          is a negative number, X will pay the absolute value of that amount to
          Y.

     (iii)  Adjustment for Bankruptcy. In circumstances where an Early
     Termination Date occurs because "Automatic Early Termination" applies in
     respect of a party, the amount determined under this Section 6(e) will be
     subject to such adjustments as are appropriate and permitted by law to
     reflect any payments or deliveries made by one party to the other under
     this Agreement (and retained by such other party) during the period from
     the relevant Early Termination Date to the date for payment determined
     under Section 6(d)(ii).

     (iv)  Pre-Estimate. The parties agree that if Market Quotation applies an
     amount recoverable under this Section 6(e) is a reasonable pre-estimate of
     loss and not a penalty. Such amount is payable for the loss of bargain and
     the loss of protection against future risks and except as otherwise
     provided in this Agreement neither party will be entitled to recover any
     additional damages as a consequence of such losses.

7.   Transfer

Subject to Section 6(b)(ii), neither this Agreement nor any interest or
obligation in or under this Agreement may be transferred (whether by way of
security or otherwise) by either party without the prior written consent of the
other party, except that:

(a)  a party may make such a transfer of this Agreement pursuant to a
consolidation or amalgamation with, or merger with or into, or transfer of all
or substantially all its assets to, another entity (but without prejudice to any
other right or remedy under this Agreement); and

(b)  a party may make such a transfer of all or any part of its interest in any
amount payable to it from a Defaulting Party under Section 6(e).

Any purported transfer that is not in compliance with this Section will be void.

8.   Contractual Currency

(a)  Payment in the Contractual Currency. Each payment under this Agreement will
be made in the relevant currency specified in this Agreement for that payment
(the "Contractual Currency"). To the extent permitted by applicable law, any
obligation to make payments under this Agreement in the Contractual Currency
will not be

<PAGE>

discharged or satisfied by any tender in any currency other than the Contractual
Currency, except to the extent such tender results in the actual receipt by the
party to which payment is owed, acting in a reasonable manner and in good faith
in converting the currency so tendered into the Contractual Currency, of the
full amount in the Contractual Currency of all amounts payable in respect of
this Agreement. If for any reason the amount in the Contractual Currency so
received falls short of the amount in the Contractual Currency payable in
respect of this Agreement, the party required to make the payment will, to the
extent permitted by applicable law, immediately pay such additional amount in
the Contractual Currency as may be necessary to compensate for the shortfall. If
for any reason the amount in the Contractual Currency so received exceeds the
amount in the Contractual Currency payable in respect of this Agreement, the
party receiving the payment will refund promptly the amount of such excess.

(b)  Judgments. To the extent permitted by applicable law, if any judgment or
order expressed in a currency other than the Contractual Currency is rendered
(i) for the payment of any amount owing in respect of this Agreement, (ii) for
the payment of any amount relating to any early termination in respect of this
Agreement or (iii) in respect of a judgment or order of another court for the
payment of any amount described in (i) or (ii) above, the party seeking
recovery, after recovery in full of the aggregate amount to which such party is
entitled pursuant to the judgment or order, will be entitled to receive
immediately from the other party the amount of any shortfall of the Contractual
Currency received by such party as a consequence of sums paid in such other
currency and will refund promptly to the other party any excess of the
Contractual Currency received by such party as a consequence of sums paid in
such other currency if such shortfall or such excess arises or results from any
variation between the rate of exchange at which the Contractual Currency is
converted into the currency of the judgment or order for the purposes of such
judgment or order and the rate of exchange at which such party is able, acting
in a reasonable manner and in good faith in converting the currency received
into the Contractual Currency, to purchase the Contractual Currency with the
amount of the currency of the judgment or order actually received by such party.
The term "rate of exchange" includes, without limitation, any premiums and costs
of exchange payable in connection with the purchase of or conversion into the
Contractual Currency.

(c)  Separate Indemnities. To the extent permitted by applicable law, these
indemnities constitute separate and independent obligations from the other
obligations in this Agreement, will be enforceable as separate and independent
causes of action, will apply notwithstanding any indulgence granted by the party
to which any payment is owed and will not be affected by judgment being obtained
or claim or proof being made for any other sums payable in respect of this
Agreement.

(d)  Evidence of Loss. For the purpose of this Section 8, it will be sufficient
for a party to demonstrate that it would have suffered a loss had an actual
exchange or purchase been made.

9.   Miscellaneous

(a)  Entire Agreement. This Agreement constitutes the entire agreement and
understanding of the parties with respect to its subject matter and supersedes
all oral communication and prior writings with respect thereto.

(b)  Amendments. No amendment, modification or waiver in respect of this
Agreement will be effective unless in writing (including a writing evidenced by
a facsimile transmission) and executed by each of the parties or confirmed by an
exchange of telexes or electronic messages on an electronic messaging system.

(c)  Survival of Obligations. Without prejudice to Sections 2(a)(iii) and
6(c)(ii), the obligations of the parties under this Agreement will survive the
termination of any Transaction.

(d)  Remedies Cumulative. Except as provided in this Agreement, the rights,
powers, remedies and privileges provided in this Agreement are cumulative and
not exclusive of any rights, powers, remedies and privileges provided by law.

(e)  Counterparts and Confirmations.

<PAGE>

     (i)  This Agreement (and each amendment, modification and waiver in respect
     of it) may be executed and delivered in counterparts (including by
     facsimile transmission), each of which will be deemed an original.

     (ii)  The parties intend that they are legally bound by the terms of each
     Transaction from the moment they agree to those terms (whether orally or
     otherwise). A Confirmation shall be entered into as soon as practicable and
     may be executed and delivered in counterparts (including by facsimile
     transmission) or be created by an exchange of telexes or by an exchange of
     electronic messages on an electronic messaging system, which in each case
     will be sufficient for all purposes to evidence a binding supplement to
     this Agreement. The parties will specify therein or through another
     effective means that any such counterpart, telex or electronic message
     constitutes a Confirmation.

(f)  No Waiver of Rights. A failure or delay in exercising any right, power or
privilege in respect of this Agreement will not be presumed to operate as a
waiver, and a single or partial exercise of any right, power or privilege will
not be presumed to preclude any subsequent or further exercise, of that right,
power or privilege or the exercise of any other, right, power or privilege.

(g)  Headings. The headings used in this Agreement are for convenience of
reference only and are not to affect the construction of or to be taken into
consideration in interpreting this Agreement.

10.  Offices; Multibranch Parties

(a)  If Section 10(a) is specified in the Schedule as applying, each party that
enters into a Transaction through an Office other than its head or home office
represents to the other party that, notwithstanding the place of booking office
or jurisdiction of incorporation or organisation of such party, the obligations
of such party are the same as if it had entered into the Transaction through its
head or home office. This representation will be deemed to be repeated by such
party on each date on which a Transaction is entered into.

(b)  Neither party may change the Office through which it makes and receives
payments or deliveries for the purpose of a Transaction without the prior
written consent of the other party.

(c)  If a party is specified as a Multibranch Party in the Schedule, such
Multibranch Party may make and receive payments or deliveries under any
Transaction through any Office listed in the Schedule, and the Office through
which it makes and receives payments or deliveries with respect to a Transaction
will be specified in the relevant Confirmation.

11.  Expenses

A Defaulting Party will, on demand, indemnify and hold harmless the other party
for and against all reasonable out-of-pocket expenses, including legal fees and
Stamp Tax, incurred by such other party by reason of the enforcement and
protection of its rights under this Agreement or any Credit Support Document to
which the Defaulting Party is a party or by reason of the early termination of
any Transaction, including, but not limited to, costs of collection.

12.  Notices

(a)  Effectiveness. Any notice or other communication in respect of this
Agreement may be given in any manner set forth below (except that a notice or
other communication under Section 5 or 6 may not be given by facsimile
transmission or electronic messaging system) to the address or number or in
accordance with the electronic messaging system details provided (see the
Schedule) and will be deemed effective as indicated:

     (i)  if in writing and delivered in person or by courier, on the date it is
          delivered;

<PAGE>

     (ii)  if sent by telex, on the date the recipient's answerback is received;

     (iii) if sent by facsimile transmission, on the date that transmission is
     received by a responsible employee of the recipient in legible form (it
     being agreed that the burden of proving receipt will be on the sender and
     will not be met by a transmission report generated by the sender's
     facsimile machine);

     (iv)  if sent by certified or registered mail (airmail, if overseas) or the
     equivalent (return receipt requested), on the date that mail is delivered
     or its delivery is attempted; or

     (v)   if sent by electronic messaging system, on the date that electronic
     message is received,

     unless the date of that delivery (or attempted delivery) or that receipt,
     as applicable, is not a Local Business Day or that communication is
     delivered (or attempted) or received, as applicable, after the close of
     business on a Local Business Day, in which case that communication shall be
     deemed given and effective on the first following day that is a Local
     Business Day.

(b)  Change of Addresses. Either party may by notice to the other change the
address, telex or facsimile number or electronic messaging system details at
which notices or other communications are to be given to it.

13.  Governing Law and Jurisdiction

(a)  Governing Law. This Agreement will be governed by and construed in
     accordance with the law specified in the Schedule.

(b)  Jurisdiction. With respect to any suit, action or proceedings relating to
     this Agreement ("Proceedings"), each party irrevocably:

     (i)  submits to the jurisdiction of the English courts, if this Agreement
     is expressed to be governed by English law, or to the non-exclusive
     jurisdiction of the courts of the State of New York and the United States
     District Court located in the Borough of Manhattan in New York City, if
     this Agreement is expressed to be governed by the laws of the State of New
     York; and

     (ii)  waives any objection which it may have at any time to the laying of
     venue of any Proceedings brought in any such court, waives any claim that
     such Proceedings have been brought in an inconvenient forum and further
     waives the right to object, with respect to such Proceedings, that such
     court does not have any jurisdiction over such party.

Nothing in this Agreement precludes either party from bringing Proceedings in
any other jurisdiction (outside, if this Agreement is expressed to be governed
by English law, the Contracting States, as defined in Section 1(3) of the Civil
Jurisdiction and Judgments Act 1982 or any modification, extension or
re-enactment thereof for the time being in force) nor will the bringing of
Proceedings in any one or more jurisdictions preclude the bringing of
Proceedings in any other jurisdiction.

(c)  Service of Process. Each party irrevocably appoints the Process Agent (if
any) specified opposite its name in the Schedule to receive, for it and on its
behalf, service of process in any Proceedings. If for any reason any party's
Process Agent is unable to act as such, such party will promptly notify the
other party and within 30 days appoint a substitute process agent acceptable to
the other party. The parties irrevocably consent to service of process given in
the manner provided for notices in Section 12. Nothing in this Agreement will
affect the right of either party to serve process in any other manner permitted
by law.

(d)  Waiver of Immunities. Each party irrevocably waives, to the fullest extent
permitted by applicable law, with respect to itself and its revenues and assets
(irrespective of their use or intended use), all immunity on the grounds of

<PAGE>

sovereignty or other similar grounds from (i) suit, (ii) jurisdiction of any
court, (iii) relief by way of injunction, order for specific performance or for
recovery of property, (iv) attachment of its assets (whether before or after
judgment) and (v) execution or enforcement of any judgment to which it or its
revenues or assets might otherwise be entitled in any Proceedings in the courts
of any jurisdiction and irrevocably agrees, to the extent permitted by
applicable law, that it will not claim any such immunity in any Proceedings.

14.  Definitions

As used in this Agreement:--

"Additional Termination Event" has the meaning specified in Section 5(b).

"Affected Party" has the meaning specified in Section 5(b).

"Affected Transactions" means (a) with respect to any Termination Event
consisting of an Illegality; Tax Event or Tax Event Upon Merger, all
Transactions affected by the occurrence of such Termination Event and (b) with
respect to any other Termination Event, all Transactions.

"Affiliate" means, subject to the Schedule, in relation to any person, any
entity controlled, directly or indirectly, by the person, any entity that
controls, directly or indirectly, the person or any entity directly or
indirectly under common control with the person. For this purpose, "control" of
any entity or person means ownership of a majority of the voting power of the
entity or person.

"Applicable Rate" means:

(a)  in respect of obligations payable or deliverable (or which would have been
but for Section 2(a)(iii)) by a Defaulting Party, the Default Rate;

(b)  in respect of an obligation to pay an amount under Section 6(e) of either
party from and after the date (determined in accordance with Section 6(d)(ii))
on which that amount is payable, the Default Rate;

(c)  in respect of all other obligations payable or deliverable (or which would
have been but for Section 2(a)(iii)) by a Non-defaulting Party, the Non-default
Rate; and

(d)  in all other cases, the Termination Rate.

"Burdened Party" has the meaning specified in Section 5(b).

"Change in Tax Law" means the enactment, promulgation, execution or ratification
of, or any change in or amendment to, any law (or in the application or official
interpretation of any law) that occurs on or after the date on which the
relevant Transaction is entered into.

"consent" includes a consent, approval, action, authorisation, exemption,
notice, filing, registration or exchange control consent.

"Credit Event Upon Merger" has the meaning specified in Section 5(b).

"Credit Support Document" means any agreement or instrument that is specified as
such in this Agreement.

"Credit Support Provider" has the meaning specified in the Schedule.

<PAGE>

"Default Rate" means a rate per annum equal to the cost (without proof or
evidence of any actual cost) to the relevant payee (as certified by it) if it
were to fund or of funding the relevant amount plus 1% per annum.

"Defaulting Party" has the meaning specified in Section 6(a).

"Early Termination Date" means the date determined in accordance with Section
6(a) or 6(b)(iv).

"Event of Default" has the meaning specified in Section 5(a) and, if applicable,
in the Schedule.

"Illegality" has the meaning specified in Section 5(b).

"Indemnifiable Tax" means any Tax other than a Tax that would not be imposed in
respect of a payment under this Agreement but for a present or former connection
between the jurisdiction of the government or taxation authority imposing such
Tax and the recipient of such payment or a person related to such recipient
(including, without limitation, a connection arising from such recipient or
related person being or having been a citizen or resident of such jurisdiction,
or being or having been organised, present or engaged in a trade or business in
such jurisdiction, or having or having had a permanent establishment or fixed
place of business in such jurisdiction, but excluding a connection arising
solely from such recipient or related person having executed, delivered,
performed its obligations or received a payment under, or enforced, this
Agreement or a Credit Support Document).

"law" includes any treaty, law, rule or regulation (as modified, in the case of
tax matters, by the practice of any relevant governmental revenue authority) and
"lawful" and "unlawful" will be construed accordingly.

"Local Business Day" means, subject to the Schedule, a day on which commercial
banks are open for business (including dealings in foreign exchange and foreign
currency deposits) (a) in relation to any obligation under Section 2(a)(i), in
the place(s) specified in the relevant Confirmation or, if not so specified, as
otherwise agreed by the parties in writing or determined pursuant to provisions
contained, or incorporated by reference, in this Agreement, (b) in relation to
any other payment, in the place where the relevant account is located and, if
different, in the principal financial centre, if any, of the currency of such
payment, (c) in relation to any notice or other communication, including notice
contemplated under Section 5(a)(i), in the city specified in the address for
notice provided by the recipient and, in the case of a notice contemplated by
Section 2(b), in the place where the relevant new account is to be located and
(d) in relation to Section 5(a)(v)(2), in the relevant locations for performance
with respect to such Specified Transaction.

"Loss" means, with respect to this Agreement or one or more Terminated
Transactions, as the case may be, and a party, the Termination Currency
Equivalent of an amount that party reasonably determines in good faith to be its
total losses and costs (or gain, in which case expressed as a negative number)
in connection with this Agreement or that Terminated Transaction or group of
Terminated Transactions, as the case may be, including any loss of bargain, cost
of funding or at the election of such party but without duplication, loss or
cost incurred as a result of its terminating, liquidating, obtaining or
reestablishing any hedge or related trading position (or any gain resulting from
any of them). Loss includes losses and costs (or gains) in respect of any
payment or delivery required to have been made (assuming satisfaction of each
applicable condition precedent) on or before the relevant Early Termination Date
and not made, except, so as to avoid duplication, if Section 6(e)(i)(1) or (3)
or 6(e)(ii)(2)(A) applies. Loss does not include a party's legal fees and
out-of-pocket expenses referred to under Section 11. A party will determine its
Loss as of the relevant Early Termination Date, or, if that is not reasonably
practicable, as of the earliest date thereafter as is reasonably practicable. A
party may (but need not) determine its Loss by reference to quotations of
relevant rates or prices from one or more leading dealers in the relevant
markets.

"Market Quotation" means, with respect to one or more Terminated Transactions
and a party making the determination, an amount determined on the basis of
quotations from Reference Market-makers. Each quotation will be for an amount,
if any, that would be paid to such party (expressed as a negative number) or by
such party (expressed as a positive number) in consideration of an agreement
between such party (taking into account any existing Credit Support Document
with

<PAGE>

respect to the obligations of such party) and the quoting Reference Market-maker
to enter into a transaction (the "Replacement Transaction") that would have the
effect of preserving for such party the economic equivalent of any payment or
delivery (whether the underlying obligation was absolute or contingent and
assuming the satisfaction of each applicable condition precedent) by the parties
under Section 2(a)(i) in respect of such Terminated Transaction or group of
Terminated Transactions that would, but for the occurrence of the relevant Early
Termination Date, have been required after that date. For this purpose, Unpaid
Amounts in respect of the Terminated Transaction or group of Terminated
Transactions are to be excluded but, without limitation, any payment or delivery
that would, but for the relevant Early Termination Date, have been required
(assuming satisfaction of each applicable condition precedent) after that Early
Termination Date is to be included. The Replacement Transaction would be subject
to such documentation as such party and the Reference Market-maker may, in good
faith, agree. The party making the determination (or its agent) will request
each Reference Market-maker to provide its quotation to the extent reasonably
practicable as of the same day and time without regard to different time zones)
on or as soon as reasonably practicable after the relevant Early Termination
Date. The day and time as of which those quotations are to be obtained will be
selected in good faith by the party obliged to make a determination under
Section 6(e), and, if each party is so obliged, after consultation with the
other. If more than three quotations are provided, the Market Quotation will be
the arithmetic mean of the quotations, without regard to the quotations having
the highest and lowest values. If exactly three such quotations are provided,
the Market Quotation will be the quotation remaining after disregarding the
highest and lowest quotations. For this purpose, if more than one quotation has
the same highest value or lowest value, then one of such quotations shall be
disregarded. If fewer than three quotations are provided, it will be deemed that
the Market Quotation in respect of such Terminated Transaction or group of
Terminated Transactions cannot be determined.

"Non-default Rate" means a rate per annum equal to the cost (without proof or
evidence of any actual cost) to the Non-defaulting Party (as certified by it) if
it were to fund the relevant amount.

"Non-defaulting Party" has the meaning specified in Section 6(a).

"Office" means a branch or office of a party, which may be such party's head or
home office.

"Potential Event of Default" means any event which, with the giving of notice or
the lapse of time or both, would constitute an Event of Default.

"Reference Market-makers" means four leading dealers in the relevant market
selected by the party determining a Market Quotation in good faith (a) from
among dealers of the highest credit standing which satisfy all the criteria that
such party applies generally at the time in deciding whether to offer or to make
an extension of credit and (b) to the extent practicable, from among such
dealers having an office in the same city.

"Relevant Jurisdiction" means, with respect to a party, the jurisdictions (a) in
which the party is incorporated, organised, managed and controlled or considered
to have its seat, (b) where an Office through which the party is acting for
purposes of this Agreement is located, (c) in which the party executes this
Agreement and (d) in relation to any payment, from or through which such payment
is made.

"Scheduled Payment Date" means a date on which a payment or delivery is to be
made under Section 2(a)(i) with respect to a Transaction.

"Set-off" means set-off, offset, combination of accounts, right of retention or
withholding or similar right or requirement to which the payer of an amount
under Section 6 is entitled or subject (whether arising under this Agreement,
another contract, applicable law or otherwise) that is exercised by, or imposed
on, such payer.

"Settlement Amount" means, with respect to a party and any Early Termination
Date, the sum of:

(a)  the Termination Currency Equivalent of the Market Quotations (whether
positive or negative) for each Terminated Transaction or group of Terminated
Transactions for which a Market Quotation is determined;

<PAGE>

and

(b)  such party's Loss (whether positive or negative and without reference to
any Unpaid Amounts) for each Terminated Transaction or group of Terminated
Transactions for which a Market Quotation cannot be determined or would not (in
the reasonable belief of the party making the determination) produce a
commercially reasonable result.

"Specified Entity" has the meaning specified in the Schedule.

"Specified Indebtedness" means, subject to the Schedule, any obligation (whether
present or future, contingent or otherwise, as principal or surety or otherwise)
in respect of borrowed money.

"Specified Transaction" means, subject to the Schedule, (a) any transaction
(including an agreement with respect thereto) now existing or hereafter entered
into between one party to this Agreement (or any Credit Support Provider of such
party or any applicable Specified Entity of such party) and the other party to
this Agreement (or any Credit Support Provider of such other party or any
applicable Specified Entity of such other party) which is a rate swap
transaction, basis swap, forward rate transaction, commodity swap, commodity
option, equity or equity index swap, equity or equity index option, bond option,
interest rate option, foreign exchange transaction, cap transaction, floor
transaction, collar transaction, currency swap transaction, crosscurrency rate
swap transaction, currency option or any other similar transaction (including
any option with respect to any of these transactions), (b) any combination of
these transactions and (c) any other transaction identified as a Specified
Transaction in this Agreement or the relevant confirmation.

"Stamp Tax" means any stamp, registration, documentation or similar tax.

"Tax" means any present or future tax, levy, impost, duty, charge, assessment or
fee of any nature (including interest, penalties and additions thereto) that is
imposed by any government or other taxing authority in respect of any payment
under this Agreement other than a stamp, registration, documentation or similar
tax.

"Tax Event" has the meaning specified in Section 5(b).

"Tax Event Upon Merger" has the meaning specified in Section 5(b).

"Terminated Transactions" means with respect to any Early Termination Date (a)
if resulting from a Termination Event, all Affected Transactions and (b) if
resulting from an Event of Default, all Transactions (in either case) in effect
immediately before the effectiveness of the notice designating that Early
Termination Date (or, if "Automatic Early Termination" applies, immediately
before that Early Termination Date).

"Termination Currency" has the meaning specified in the Schedule.

"Termination Currency Equivalent" means, in respect of any amount denominated in
the Termination Currency, such Termination Currency amount and, in respect of
any amount denominated in a currency other than the Termination Currency (the
"Other Currency"), the amount in the Termination Currency determined by the
party making the relevant determination as being required to purchase such
amount of such Other Currency as at the relevant Early Termination Date, or, if
the relevant Market Quotation or Loss (as the case may be), is determined as of
a later date, that later date, with the Termination Currency at the rate equal
to the spot exchange rate of the foreign exchange agent (selected as provided
below) for the purchase of such Other Currency with the Termination Currency at
or about 11:00 a.m. (in the city in which such foreign exchange agent is
located) on such date as would be customary for the determination of such a rate
for the purchase of such Other Currency for value on the relevant Early
Termination Date or that later date. The foreign exchange agent will, if only
one party is obliged to make a determination under Section 6(e), be selected in
good faith by that party and otherwise will be agreed by the parties.

<PAGE>

"Termination Event" means an Illegality, a Tax Event or a Tax Event Upon Merger
or, if specified to be applicable, a Credit Event Upon Merger or an Additional
Termination Event.

"Termination Rate" means a rate per annum equal to the arithmetic mean of the
cost (without proof or evidence of any actual cost) to each party (as certified
by such party) if it were to fund or of funding such amounts.

"Unpaid Amounts" owing to any party means, with respect to an Early Termination
Date, the aggregate of (a) in respect of all Terminated Transactions, the
amounts that became payable (or that would have become payable but for Section
2(a)(iii)) to such party under Section 2(a)(i) on or prior to such Early
Termination Date and which remain unpaid as at such Early Termination Date and
(b) in respect of each Terminated Transaction, for each obligation under Section
2(a)(i) which was (or would have been but for Section 2(a)(iii)) required to be
settled by delivery to such party on or prior to such Early Termination Date and
which has not been so settled as at such Early Termination Date, an amount equal
to the fair market value of that which was (or would have been) required to be
delivered as of the originally scheduled date for delivery, in each case
together with (to the extent permitted under applicable law) interest, in the
currency of such amounts, from (and including) the date such amounts or
obligations were or would have been required to have been paid or performed to
(but excluding) such Early Termination Date, at the Applicable Rate. Such
amounts of interest will be calculated on the basis of daily compounding and the
actual number of days elapsed. The fair market value of any obligation referred
to in clause (b) above shall be reasonably determined by the party obliged to
make the determination under Section 6(e) or, if each party is so obliged, it
shall be the average of the Termination Currency Equivalents of the fair market
values reasonably determined by both parties.

IN WITNESS WHEREOF the parties have executed this document on the respective
dates specified below with effect from the date specified on the first page of
this document.

BANK OF AMERICA, N.A                      PACKAGING DYNAMICS, L.L.C.

By:    ________________________________   By: /s/ Richard R. Cote
                                              --------------------------------
Name:  ________________________________   Name: R.R. Cote
                                                ------------------------------
Title: ________________________________   Title: VP
                                                 -----------------------------
Date:  ________________________________   Date: ______________________________

<PAGE>

(Multicurrency - Cross Border)

                                     ISDA(R)
                  International Swap Dealers Association, Inc.

                                    SCHEDULE

                                     to the

                                Master Agreement

                            dated as of May 16, 2001

between BANK OF AMERICA, N.A.                   and PACKAGING DYNAMICS, L.L.C.
         ("Party A")                                  ("Party B")

                         PART 1: Termination Provisions.

(a)  "Credit Agreement" means the Credit Agreement dated November 20, 1998 among
Party B as Borrower, Packaging Holdings, L.L.C. and The Subsidiaries, of the
Borrower as Guarantors, The Lender Identified Therein, and Bank of America,
N.A., as successor by merger with NationsBank, N.A., as Agent, as amended,
supplemented, modified, renewed, replaced, consolidated, substituted or extended
from time to time.

(b)   "Specified Entity" means in relation to Party A for the purpose of:--

      Section 5(a)(v) (Default under Specified Transaction),       none;

      Section 5(a)(vi) (Cross Default),                            none;

      Section 5(a)(vii) (Bankruptcy),                              none; and

      Section 5(b)(iv) (Credit Event Upon Merger),                 none;

      in relation to Party B for the purpose of:--

      Section 5(a)(v) (Default under Specified Transaction)        none;

      Section 5(a)(vi) (Cross Default),                            none;

      Section 5(a)(vii) (Bankruptcy),                              none; and

      Section 5(b)(iv) (Credit Event Upon Merger),                 none.

(c)   "Specified Transaction" will have the meaning specified in Section 14.

<PAGE>

(d)  The "Cross-Default" provisions of Section 5(a)(vi) (as amended in Part
5(h))
           will apply to Party A and
           will apply to Party B.

In connection therewith, "Specified Indebtedness" will not have the meaning
specified in Section 14, and such definition shall be replaced by the following:
"any obligation in respect of the payment of moneys (whether present or future,
contingent or otherwise, as principal or surety or otherwise), except that such
term shall not include obligations in respect of deposits received in the
ordinary course of a party's banking business."

"Threshold Amount" means (i) with respect to Party A, an amount equal to three
percent (3%) of the Shareholders' Equity of Bank of America Corporation, and
(ii) with respect to Party B, $500,000. For purposes of this definition, any
Specified Indebtedness denominated in a currency other than the currency in
which the financial statements of such party are denominated shall be converted
into the currency in which such financial statements are denominated at the
exchange rate therefor reasonably chosen by the other party or the equivalent
thereof in any other currencies.

With respect to Party B, any default (howsoever defined) under the Credit
Agreement shall be an Event of Default under this Agreement.

"Shareholders' Equity" means with respect to an entity, at any time, the sum (as
shown in the most recent annual audited financial statements of such entity) of
(i) its capital stock (including preferred stock) outstanding, taken at par
value, (ii) its capital surplus and (iii) its retained earnings, minus (iv)
treasury stock, each to be determined in accordance with generally accepted
accounting principles.

(e)  The "Credit Event Upon Merger" provisions of Section 5(b)(iv)
           will apply to Party A.
           will apply to Party B.

(f)  The "Automatic Early Termination" provision of Section 6(a)
           will not apply to Party A
           will not apply to Party B.

(g)  Payments on Early Termination. For the purpose of Section 6(e):

      (1)  Market Quotation will apply.

      (2)  The Second Method will apply.

(h)  "Termination Currency" means United States Dollars.

(i)  "Additional Termination Event." Additional Termination Event will apply.
Each of the following events shall constitute an Additional Termination Event,
with respect to which Party B shall be the Affected Party:

Termination of Credit Agreement. The prepayment prior to maturity or other
termination of all obligations of Party B under all credit agreements, security
agreements, guaranties and other related documentation in effect as of the date
of this Agreement between Party A and Party B, unless Party A and Party "B
simultaneously enter into another credit facility. For purposes of this
Additional Termination Event, in the case of any credit agreement, security
agreement, guaranty or other related documentation between Party B and Party A
and one or more third parties, then, if Party A ceases to be a party to any such
credit agreement, security agreement, guaranty or other related documentation
prior to maturity or other termination thereof, then a prepayment thereof shall
be deemed to have occurred even if the credit agreement, security agreement,
guaranty or other related documentation remains in effect between Party B and
any such third parties.

<PAGE>

                           PART 2: Tax Representations

(a)  Payer Tax Representations. For the purpose of Section 3(e) of this
Agreement, Party A and Party B will make the following representation:

         It is not required by any applicable law, as modified by the practice
         of any relevant governmental revenue authority of any Relevant
         Jurisdiction to make any deduction or withholding for or on account of
         any Tax from any payment (other than interest under Section 2(e),
         6(d)(ii) or 6(e) of this Agreement) to be made by it to the other party
         under this Agreement. In making this representation, it may rely on (x)
         the accuracy of any representations made by the other party pursuant to
         Section 3(f) of this Agreement, (y) the satisfaction of the agreement
         contained in Section 4(a)(i) or 4(a)(iii) of this Agreement and the
         accuracy and effectiveness of any document provided by the other party
         pursuant to Section 4(a)(i) or 4(a)(iii) of this Agreement and (z) the
         satisfaction of the agreement of the other party contained in Section
         4(d) of this Agreement, provided that it shall not be a breach of this
         representation where reliance is placed on clause (y) and the other
         party does not deliver a form or document under Section 4(a)(iii) by
         reason of material prejudice to its legal or commercial position.

(b)  Payee Tax Representations. For the purpose of Section 3(f) of this
Agreement, Party A and Party B will make the following representations specified
below, if any:

      (i)   The following representations will apply to Party A:

      Party A is a national banking association created or organized under the
      laws of the United States of America and the federal taxpayer
      identification number is 94-168-7665.

      (ii)   The following representations will apply to Party B:

      Party B is a limited liability company created or organized under the laws
      of the State of Delaware and the federal taxpayer identification number is
      _________________.

                     PART 3: Agreement to Deliver Documents

      For the purpose of Section 4(a)(i) and (ii) of this Agreement, each party
      agrees to deliver the following documents:

(a)  Tax forms, documents or certificates to be delivered are:

            Any form, document or certificate as may be requested pursuant to
            Section 4(a)(iii) of this Agreement.

<PAGE>

(b)  Other documents to be delivered are:

<TABLE>
<CAPTION>
Party required   Form/Document/Certificate          Date by which to be              Covered by
to deliver                                          delivered                        Section 3(d)
document                                                                             Representation
<S>              <C>                                <C>                              <C>
Party B          Annual Report of each party        As soon as available and in      Yes
                 and of any Credit Support          any event within 120 days
                 Provider thereof containing        after the end of each fiscal
                 audited, consolidated              year of Party B and of the
                 financial statements certified     Credit Support Provider
                 by independent certified
                 public accountants and
                 prepared in accordance with
                 generally accepted accounting
                 principles in the country in
                 which such party and such
                 Credit Support Provider is
                 organized

Party B          Quarterly Financial Statements     Upon Request                     Yes
                 of each party and any Credit
                 Support Provider thereof
                 containing unaudited,
                 consolidated financial
                 statements of such party's
                 fiscal quarter prepared in
                 accordance with generally
                 accepted accounting principles
                 in the country in which such
                 party and such Credit Support
                 Provider is organized

Party A and      Certified copies of all            Upon execution and delivery of   Yes
Party B          corporate authorizations and       this Agreement
                 any other documents with
                 respect to the execution,
                 delivery and performance of
                 this Agreement and any Credit
                 Support Document

Party A and      Certificate of authority and       Upon execution and delivery of   Yes
Party B          specimen signatures of             this Agreement and thereafter
                 individuals executing this         upon request of the other
                 Agreement and any Credit           party
                 Support Document and
                 Confirmations
</TABLE>

<PAGE>

                              PART 4: Miscellaneous

(a)  Address for Notices. For the purpose of Section 12(a) of this Agreement:

      Bank of America, N.A.
      Sears Tower
      233 South Wacker Drive, Suite 2800, IL1-003-27-20
      Chicago, Illinois 60606
      Attention: Swap Operations
      Telex No.: 49663210 Answerback: NATIONSBANK CHA
      Reuters Dealing Code: NBCH

      with a copy to:

      Bank of America, N.A.
      315 Montgomery Street, 10/th/ Floor
      Mail Code: C-A5-704-10-25
      San Francisco, California  94104
      Attention: Capital Markets Documentation
      Facsimile: 415-953-7997

      Address for financial statements to Party A:

      Bank of America, N.A.
      100 N. Tryon Street
      Mail Code: NC1-007-17-12
      Charlotte, North Carolina 28255
      Attention: Apparel-Furnishings-Textiles
      Facsimile: 704-386-1270

      Address for notice or communications to Party B:

      Packaging Dynamics, L.L.C.
      3900 W. 43/rd/ Street
      Chicago, Illinois 60632
      Attention: Richard Cote
      Telephone: 847-374-4324

(b)  Process Agent. For the purpose of Section 13(c):

      Party A appoints as its Process Agent: Not applicable.

      Party B appoints as its Process Agent: Not applicable

(c)  Offices. The provisions of Section 10(a) will apply to this Agreement.

<PAGE>

(d)  Multibranch Party. For the purpose of Section 10 of this Agreement:

      Party A is a Multibranch Party and may act through its Charlotte, North
      Carolina, Chicago, Illinois, San Francisco, California, New York, New York
      or London, England Office, or such other Office as may be agreed to by the
      parties in connection with a Transaction.

      Party B is not a Multibranch Party and may act through its Chicago,
      Illinois Office, or such other Office as may be agreed to by the parties
      in connection with a Transaction.

(e)  Calculation Agent. The Calculation Agent is Party A.

(f)  Credit Support Document. Details of any Credit Support Document:

      Each of the following, as amended, supplemented, Modified, renewed,
      replaced, consolidated, substituted or extended from time to time, is a
      "Credit Support Document":

      In relation to Party B: the Credit Agreement and each of the other Credit
      Documents (as defined in the Credit Agreement), including but not limited
      to the Security Agreement dated November 20, 1998 among Party B, Packaging
      Holdings, L.L.C., each of the Subsidiaries of the Borrower listed in the
      Credit Agreement and Party A.

      Party B agrees that the security interests in collateral granted to Party
      A under the foregoing Credit Support Documents shall secure the
      obligations of Party B to Party A under this Agreement.

(g)  Credit Support Provider.

      Credit Support Provider
      means in relation to Party A:   Not applicable.

      Credit Support Provider
      means in relation to Party B:   Packaging Holdings,  L.L.C., Bagcraft
                                      Acquisition, L.L.C., IPMC Acquisition,
                                      L.L.C. and each other Person (as defined
                                      in the Credit Agreement) that has become
                                      or becomes a Guarantor (as defined in
                                      the Credit Agreement).

(h)  Governing Law. This Agreement will be governed by and construed in
accordance with the laws of the State of New York (without reference to its
conflict of laws doctrine).

(i)  Netting of Payments. All amounts payable on the same date, in the same
currency and in respect of the same Transaction shall be netted in accordance
with Section 2(c) of this Agreement. The election contained in the last
paragraph of Section 2(c) of this Agreement shall not apply for the purposes of
this Agreement.

(j)  "Affiliate" will have the meaning specified in Section 14 of this
Agreement.

<PAGE>

                            PART 5: Other Provisions

(a)  Set-off. Any amount (the "Early Termination Amount") payable to one party
(the Payee) by the other party (the Payer) under Section 6(e), in circumstances
where there is a Defaulting Party or one Affected Party in the case where a
Termination Event under Section 5(b)(iv) or (v) has occurred, will, at the
option of the party ("X") other than the Defaulting Party or the Affected Party
(and without prior notice to the Defaulting Party or the Affected Party), be
reduced by its set-off against any amounts) (the "Other Agreement Amount")
payable (whether at such time or in the future or upon the occurrence of a
contingency) by the Payee to the Payer (irrespective of the currency, place of
payment or booking office of the obligation) under any other agreement(s)
between the Payee and the Payer or instrument(s) or undertaking(s) issued or
executed by one party to, or in favor of, the other party (and the Other
Agreement Amount will be discharged promptly and in all respects to the extent
it is so set-off). X will give notice to the other party of any set-off effected
under this Part 5(a).

For this purpose, either the Early Termination Amount or the Other Agreement
Amount (or the relevant portion of such amounts) may be converted by X into the
currency in which the other is denominated at the rate of exchange at which such
party would be able, acting in a reasonable manner and in good faith, to
purchase the relevant amount of such currency.

If an obligation is unascertained, X may in good faith estimate that obligation
and set-off in respect of the estimate, subject to the relevant party accounting
to the other when the obligation is ascertained.

Nothing in this Part 5(a) shall be effective to create a charge or other
security interest. This Part 5(a) shall be without prejudice and in addition to
any right of set-off, combination of accounts, lien or other right to which any
party is at any time otherwise entitled (whether by operation of law, contract
or otherwise).

(b)  Delivery of Confirmations. For each Transaction entered into hereunder,
Party A shall promptly send to Party B a Confirmation via facsimile
transmission. Party B agrees to respond to such Confirmation within two (2)
Local Business Days, either confirming agreement thereto or requesting a
correction of any error(s) contained therein. Failure by Party A to send a
Confirmation or of Party B to respond within such period shall not affect the
validity or enforceability of such Transaction. Absent manifest error, there
shall be a presumption that the terms contained in such Confirmation are the
terms of the Transaction.

(c)  Recording of Conversations. Each party to this Agreement acknowledges and
agrees to the tape recording of conversations between trading and marketing
personnel of the parties to this Agreement whether by one or other or both of
the parties or their agents, and that any such tape recordings may be submitted
in evidence in any proceedings relating to the Agreement.

(d)  Furnishing Specified Information. Section 4(a)(iii) is hereby amended by
inserting "promptly upon the earlier of (i)" in lieu of the word "upon" at the
beginning thereof and inserting "or (ii) such party learning that the form or
document is required" before the word "any" on the first line thereof.

(e)  Notice by Facsimile Transmission. Section 12(a) is hereby amended by
inserting the words "2(b)," between the word "Section" and the number "5" and
inserting the words "or 13(c)" between the number "6" and the word "may" in the
second line thereof.

(f)  Section 3(a) of this Agreement is amended by (i) deleting the word "and"
at the end of clause (iv); (ii) deleting the period at the end of clause (v) and
inserting therein "; and " ; and (iii) by inserting the following additional
representation:

      "(vi) Eligible Contract Participant. Each party represents to the other
      party (which representation will be deemed to be repeated by each party on
      each date on which a Transaction is entered into) that it is an "eligible

<PAGE>

      contract participant" as defined in Section 1a(12) of the U.S. Commodity
      Exchange Act, 7 U.S.C. Section 1a(12).

      Section 3 is revised so as to add the following Section (g) at the end
thereof:

(g)  Relationship Between Parties. Each party represents to the other party and
will be deemed to represent to the other party on the date on which it enters
into a Transaction that (absent a written agreement between the parties that
expressly imposes affirmative obligations to the contrary for
that Transaction): --

      (i)   Non-Reliance. It is acting for its own account, and it has made its
      own independent decisions to enter into that Transaction and as to whether
      that Transaction is appropriate or proper for it based upon its own
      judgment and upon advice from such advisors as it has deemed necessary. It
      is not relying on any communication (written or oral) of the other party
      as investment advice or as a recommendation to enter into that
      Transaction; it being understood that information and explanations related
      to the terms and conditions of a Transaction shall not be considered
      investment advice or a recommendation to enter into that Transaction.
      Further, such party has not received from the other party any assurance or
      guarantee as to the expected results of that Transaction.

      (ii)   Evaluation and Understanding. It is capable of evaluating and
      understanding (on its own behalf or through independent professional
      advice), and understands and accepts, the terms, conditions and risks of
      that Transaction. It is also capable of assuming, and assumes, the
      financial and other risks of that Transaction.

      (iii)   Status of Parties. The other party is not acting as an agent,
      fiduciary or advisor for it in respect of that Transaction.

(h)  Waiver of Right to Trial by Jury. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY
AND ALL RIGHTS TO TRIAL BY JURY WITH RESPECT TO ANY LEGAL PROCEEDING ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

<PAGE>

(i)  Cross Default. Section 5(a)(vi) of this Agreement is hereby amended adding
the following after the semicolon at the end thereof:

            "provided, however, that notwithstanding the foregoing (but subject
            to any provision to the contrary contained in any such agreement or
            instrument), an Event of Default shall not occur under either (1) or
            (2) above if the default, event of default or other similar
            condition or event referred to in (1) or the failure to pay referred
            to in (2) is caused not (even in part) by the unavailability of
            funds but is caused solely due to a technical or administrative
            error which has been remedied within three Local Business Days after
            notice of such failure is given to the party."

(j)  Additional Representations. Party B represents to Party A (which
representation will be deemed to be repeated by Party B on each date on which a
Transaction is entered into) that this Transaction arises under one or more of
the Credit Documents (as defined in the Credit Agreement).

(k)  Incorporation by Reference of Terms of Credit Agreement. The covenants,
terms and provisions of, including all representations and warranties of Party B
contained in the Credit Agreement, as in effect as of the date of this
Agreement, are hereby incorporated by reference in, and made part of, this
Agreement to the same extent as if such covenants, terms, and provisions were
set forth in full herein. Party B hereby agrees that, during the period
commencing with the date of this Agreement through and including such date on
which all of Party B's obligations under this Agreement are fully performed,
Party B will (a) observe, perform, and fulfill each and every such covenant,
term, and provision applicable to Party B, as such covenants, terms, and
provisions, may be amended from time to time after the date of this Agreement
with the consent of Party A and (b) deliver to Party A at the address for
notices to Party A provided in Part 4 each notice, document, certificate or
other writing as Party B is obligated to furnish to any other party to the
Credit Agreement. In the event the Credit Agreement terminates or becomes no
longer binding on Party B prior to the termination of this Agreement, such
covenants, terms, and provisions (other than those requiring payments in respect
of amounts owed under the Credit Agreement) will remain in force and effect for
purposes of this Agreement as though set forth in full herein until the date on
which all of Party B's obligations under this Agreement are fully performed, and
this Agreement is terminated.

Accepted and agreed:

BANK OF AMERICA, N.A                                 PACKAGING DYNAMICS, L.L.C.

By:    __________________________________    By:    /s/ Richard R. Cote
                                                    ----------------------------
Name:  __________________________________    Name:  R.R. Cote
                                                    ----------------------------
Title: __________________________________    Title: VP
                                                    ----------------------------
Date:  __________________________________    Date:  ____________________________

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