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                                                                   EXHIBIT 10.31

                                PLEDGE AGREEMENT

         THIS PLEDGE AGREEMENT (this "Pledge Agreement") is entered into as of
July 22, 2003 among UNITED STATES CAN COMPANY, a Delaware corporation (the
"Company"), U.S. CAN CORPORATION, a Delaware corporation (the "Parent
Guarantor"), and each of the Domestic Subsidiaries of the Company (individually
a "Subsidiary Guarantor" and collectively the "Subsidiary Guarantors"; together
with the Company and the Parent Guarantor, individually a "Pledgor" and
collectively the "Pledgors") and WELLS FARGO BANK MINNESOTA, NATIONAL
ASSOCIATION, in its capacity as trustee and collateral agent (in such capacity,
the "Collateral Agent") for the benefit of the Holders (described below).

                                    RECITALS

         WHEREAS, pursuant to that certain Indenture dated as of the date hereof
(as amended, modified, extended, renewed, restated or replaced from time to time
hereinafter, the "Indenture") among the Company, the Collateral Agent, and the
Parent Guarantor, the Company has issued on the date hereof $125,000,000 10 7/8%
Senior Secured Notes due 2010 (collectively, the "Notes");

         WHEREAS, the Subsidiary Guarantors (including all future Subsidiaries
of the Company which become a party thereto by execution of a Guarantee
Supplement (as defined in the Indenture)) have guaranteed the obligations of the
Company under the Notes and the Indenture pursuant to the terms of that certain
Subsidiary Guarantee dated as of the date hereof (as amended, modified,
extended, renewed, restated or replaced from time to time hereinafter, the
"Subsidiary Guarantee") and the Parent Guarantor has guaranteed the obligations
of the Company under the Notes and the Indenture pursuant to the terms of that
certain Parent Guarantee dated as of the date hereof (as amended, modified,
extended, renewed, restated or replaced from time to time hereinafter, the
"Parent Guarantee"; collectively, the Indenture, the Notes, the Subsidiary
Guarantee and the Parent Guarantee, together with all documents and instruments
executed in connection therewith, are referred to herein as the "Note
Documents");

         WHEREAS, the obligations of the Company, the Parent Guarantor and the
Subsidiary Guarantors under the Note Documents are to be secured pursuant to the
terms of this Pledge Agreement by liens on and security interests in the Pledged
Collateral;

         WHEREAS, pursuant to a Lien Intercreditor Agreement dated as of the
date hereof (as amended, modified, extended, renewed, restated or replaced from
time to time hereinafter, the "Intercreditor Agreement") among Bank of America,
N.A., in its capacity as agent (in such capacity, the "Senior Agent") for the
financial institutions party to the Credit Agreement, the Collateral Agent, the
Company, the Parent Guarantor and the Subsidiary Guarantors, the liens on and
security interests in the Pledged Collateral granted by the Company, the Parent
Guarantor and the Subsidiary Guarantors pursuant hereto are junior to the liens
on and security interests in the Pledged Collateral granted by the Company, the
Parent Guarantor and the Subsidiary Guarantors to the Senior Agent; and

                                                                PLEDGE AGREEMENT

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         WHEREAS, it is a condition precedent to the effectiveness of the
Indenture and the obligations of the Holders to purchase the Notes that the
Obligors shall have executed and delivered this Pledge Agreement to the
Collateral Agent for the benefit of the Holders.

                                    AGREEMENT

         NOW, THEREFORE, in consideration of these premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:

         1.       Definitions. (a) Unless otherwise defined herein, capitalized
terms used herein shall have the meanings ascribed to such terms in the
Indenture, and the following terms which are defined in the Uniform Commercial
Code (the "UCC") in effect in the State of New York are used herein as so
defined: Control, Entitlement Order, Investment Company Security, Proceeds,
Products, Securities Account, Security Entitlement, Securities Intermediary and
Security. Except as otherwise expressly provided, all definitions shall be
equally applicable to the singular and plural forms of the terms defined.

         (b)      In addition, the following terms shall have the following
meanings:

         "First-Tier Foreign Subsidiary": any direct Foreign Subsidiary of a
Pledgor.

         "Governmental Authority": any nation or government, any
intergovernmental or supranational body, any state or other political
subdivision thereof and any entity exercising executive, legislative, judicial,
regulatory or administrative functions of government, any securities exchange
and any self-regulatory organization (including the National Association of
Insurance Commissioners).

         "Paid in Full": the indefeasible payment in full in of all obligations
of the Obligors under the Indenture and the Notes in accordance with Section
8.01(i) of the Indenture.

         "Secured Obligations": the collective reference to all of the
obligations owing from the Company or any other Obligor to any Holder or the
Collateral Agent in connection with the Note Documents, howsoever evidenced,
created, incurred or acquired, whether primary, secondary, direct, contingent,
or joint and several, including, without limitation, all obligations and
liabilities incurred in connection with collecting and enforcing the foregoing.

         "Security Agreement": that certain Security Agreement dated as of the
date hereof among the Pledgors and the Collateral Agent, as the same may be
amended, modified, extended, renewed, restated or replaced from time to time
hereinafter.

         2.       Pledge and Grant of Security Interest. To secure the prompt
payment and performance in full when due, whether by lapse of time or otherwise,
of the Pledgor Obligations (as defined in Section 3 hereof), each Pledgor hereby
pledges and assigns to the Collateral Agent, for the benefit of the Holders, and
grants to the Collateral Agent, for the benefit of the Holders, a continuing
security interest in any and all right, title and interest of such Pledgor in

                                                                PLEDGE AGREEMENT

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and to the following, whether now owned or existing or owned, acquired, or
arising hereafter (collectively, the "Pledged Collateral"):

                  (a)      Pledged Capital Stock. 100% (or, if less, the full
         amount owned by such Pledgor) of the issued and outstanding Capital
         Stock of each Domestic Subsidiary and, subject to Section 3 hereof,
         each First-Tier Foreign Subsidiary set forth on Schedule 2(a) attached
         hereto, together with the certificates (or other agreements or
         instruments), if any, representing such Capital Stock and all options
         and other rights, contractual or otherwise, with respect thereto
         (collectively, together with the Capital Stock described in Sections
         2(b) and 2(c) below, the "Pledged Capital Stock"), including, but not
         limited to, the following (provided that any Capital Stock which would
         require the presentation of separate audited financial statements for
         such Subsidiary pursuant to rules and regulations promulgated by the
         Securities and Exchange Commission shall be excluded from the
         definition of "Pledged Collateral" hereunder until such time as such
         rules and regulations are repealed, superseded or no longer of any
         force or effect at which time the applicable Pledgor shall pledge such
         Capital Stock pursuant to the terms hereof):

                           (A)      all shares, securities, membership interests
                  or other equity interests representing a dividend on any of
                  the Pledged Capital Stock, or representing a distribution or
                  return of capital upon or in respect of the Pledged Capital
                  Stock, or resulting from a stock split, revision,
                  reclassification or other exchange therefor, and any
                  subscriptions, warrants, rights or options issued to the
                  holder of, or otherwise in respect of, the Pledged Capital
                  Stock; and

                           (B)      without affecting the obligations of the
                  Pledgors under any provision prohibiting such action hereunder
                  or under the Indenture, in the event of any consolidation or
                  merger involving the issuer of any Pledged Capital Stock and
                  in which such issuer is not the surviving entity, the Capital
                  Stock of the successor entity formed by or resulting from such
                  consolidation or merger.

                  (b)      Additional Shares. 100% (or, if less, the full amount
         owned by such Pledgor) of the issued and outstanding Capital Stock of
         any Person which hereafter becomes a Domestic Subsidiary or a
         First-Tier Foreign Subsidiary, together with the certificates (or other
         agreements or instruments), if any, representing such Capital Stock.

                  (c)      Proceeds. All Proceeds and Products of the foregoing,
         however and whenever acquired and in whatever form.

         Without limiting the generality of the foregoing, it is hereby
specifically understood and agreed that a Pledgor may from time to time
hereafter deliver additional Capital Stock to the Collateral Agent as collateral
security for the Pledgor Obligations. Upon delivery to the Collateral Agent,
such additional Capital Stock shall be deemed to be part of the Pledged
Collateral of such Pledgor and shall be subject to the terms of this Pledge
Agreement whether or not Schedule 2(a) is amended to refer to such additional
Capital Stock.

                                                                PLEDGE AGREEMENT

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                  3.       Security for Pledgor Obligations. The security
         interest created hereby in the Pledged Collateral of each Pledgor
         constitutes continuing collateral security for all of the Secured
         Obligations owing from the Company or any other Pledgor to any Holder
         or the Collateral Agent, howsoever evidenced, created, incurred or
         acquired, whether primary, secondary, direct, contingent, or joint and
         several, including, without limitation, all obligations and liabilities
         incurred in connection with collecting and enforcing the foregoing
         (collectively, the "Pledgor Obligations"); provided, however, in no
         event shall more than 65% of the Capital Stock of any First Tier
         Foreign Subsidiary of any Pledgor secure the Secured Obligations.

         4.       Delivery of the Pledged Collateral; Perfection of Security
Interest. Each Pledgor hereby agrees that:

                  (a)      Delivery of Certificates. Each Pledgor shall deliver
         to the Collateral Agent or its agent or bailee (i) simultaneously with
         or prior to the execution and delivery of this Pledge Agreement, all
         certificates representing the Pledged Capital Stock of such Pledgor and
         (ii) promptly upon the receipt thereof by or on behalf of a Pledgor,
         all other certificates and instruments constituting Pledged Collateral
         of a Pledgor. Prior to delivery to the Collateral Agent, all such
         certificates and instruments constituting Pledged Collateral of a
         Pledgor shall be held in trust by such Pledgor for the benefit of the
         Collateral Agent pursuant hereto. All such certificates shall be
         delivered in suitable form for transfer by delivery or shall be
         accompanied by duly executed instruments of transfer or assignment in
         blank, substantially in the form provided in Exhibit 4(a) attached
         hereto.

                  (b)      Additional Securities. If such Pledgor shall receive
         by virtue of its being, becoming or having been the owner of any
         Pledged Collateral, any (i) certificate, including without limitation,
         any certificate representing a dividend or distribution in connection
         with any increase or reduction of capital, reclassification, merger,
         consolidation, sale of assets, combination of shares or membership or
         equity interests, stock splits, spin-off or split-off, promissory notes
         or other instrument; (ii) option or right, whether as an addition to,
         substitution for, or an exchange for, any Pledged Collateral or
         otherwise; (iii) dividends payable in securities; or (iv) distributions
         of securities or other equity interests in connection with a partial or
         total liquidation, dissolution or reduction of capital, capital surplus
         or paid-in surplus, then, subject to the percentage limitations set
         forth in Section 2(a) above, such Pledgor shall receive such
         certificate, instrument, option, right or distribution in trust for the
         benefit of the Collateral Agent, shall segregate it from such Pledgor's
         other property and shall deliver it forthwith to the Collateral Agent
         in the exact form received together with any necessary endorsement
         and/or appropriate stock power duly executed in blank, substantially in
         the form provided in Exhibit 4(a), to be held by the Collateral Agent
         as Pledged Collateral and as further collateral security for the
         Pledgor Obligations.

                  (c)      Financing Statements. Each Pledgor shall execute and
         deliver to the Collateral Agent such UCC or other applicable financing
         statements as may be reasonably requested by the Collateral Agent in
         order to perfect the security interest created hereby in the Pledged
         Collateral of such Pledgor.

                                                                PLEDGE AGREEMENT

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                  (d)      Provisions Relating to Securities Entitlements and
         Securities Accounts. With respect to any Pledged Collateral consisting
         of a Securities Entitlement or held in a Securities Account, (a) the
         applicable Pledgor and the applicable Securities Intermediary shall
         enter into an agreement with the Collateral Agent granting Control to
         the Collateral Agent over such Pledged Collateral, such agreement to be
         in form and substance satisfactory to the Collateral Agent and (b) the
         Collateral Agent shall be entitled, upon the occurrence and during the
         continuance of a Default or an Event of Default, to notify the
         applicable Securities Intermediary that it should follow the
         Entitlement Orders of the Collateral Agent and no longer follow the
         Entitlement Orders of the applicable Pledgor. Upon receipt by a Pledgor
         of notice from a Securities Intermediary of its intent to terminate the
         Securities Account of such Pledgor held by such Securities
         Intermediary, prior to the termination of such Securities Account the
         Pledged Collateral in such Securities Account shall be (i) transferred
         to a new Securities Account which is subject to a control agreement as
         provided above or (ii) transferred to an account held by the Collateral
         Agent (in which it will be held until a new Securities Account is
         established).

         5.       Representations and Warranties. Each Pledgor hereby represents
and warrants to the Collateral Agent, for the benefit of the Holders, that so
long as any of the Pledgor Obligations remain outstanding (other than any such
obligations which by the terms thereof are stated to survive termination of the
Note Documents) or any Note Document is in effect, and until all of Notes shall
have been Paid in Full and the Indenture shall have been terminated (except as
provided in Section 8.01(iii) of the Indenture):

                  (a)      Authorization of Pledged Capital Stock. The Pledged
         Capital Stock is duly authorized and validly issued, is fully paid and,
         with respect any Pledged Capital Stock consisting of stock of a
         corporation, nonassessable and is not subject to the preemptive rights
         of any Person. All other shares of Capital Stock constituting Pledged
         Collateral will be duly authorized and validly issued, fully paid and,
         with respect any Pledged Capital Stock consisting of stock of a
         corporation, nonassessable and not subject to the preemptive rights of
         any Person.

                  (b)      Title. Each Pledgor has good and indefeasible title
         to the Pledged Collateral of such Pledgor and will at all times be the
         legal and beneficial owner of such Pledged Collateral free and clear of
         any Lien or "adverse claim" (within the meaning of Section 8-102 of the
         UCC), other than Permitted Liens.

                  (c)      Exercising of Rights. Neither the grant by the
         Obligors to the Collateral Agent of the rights and remedies hereunder
         nor the exercise by the Collateral Agent of its rights and remedies
         hereunder in a lawful manner will violate any law or governmental
         regulation or any material contractual restriction binding on or
         affecting a Pledgor or any of its property; provided, however, that no
         representation or warranty is made as to any authorization, approval or
         action by, or notice of filing with, any Governmental Authority
         applicable to the Collateral Agent or any Holder.

                                                                PLEDGE AGREEMENT

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                  (d)      Pledgor's Authority. No authorization, approval or
         action by, and no notice or filing with any Governmental Authority, the
         issuer of any Pledged Capital Stock or any third party is required
         either (i) for the pledge made by a Pledgor or for the granting of the
         security interest by a Pledgor pursuant to this Pledge Agreement or
         (ii) for the exercise by the Collateral Agent on behalf of the Holders
         of its rights and remedies hereunder (except as may be required by laws
         affecting the offering and sale of securities).

                  (e)      Security Interest/Priority. This Pledge Agreement
         creates a valid security interest in favor of the Collateral Agent, for
         the benefit of the Holders, in the Pledged Collateral. Pursuant to the
         terms of the Intercreditor Agreement, the taking of possession by the
         Senior Agent of the certificates, if any, representing the Pledged
         Capital Stock and all other certificates and instruments constituting
         Pledged Collateral will perfect and establish the second priority of
         the Collateral Agent's security interest in the Pledged Capital Stock
         and such certificates and instruments and, upon the filing of UCC
         financing statements in the appropriate filing office in the location
         of each Pledgor's chief executive office, the Collateral Agent shall
         have a second priority perfected security interest, subject to
         Permitted Liens, in all uncertificated Pledged Capital Stock consisting
         of partnership or limited liability company interests that do not
         constitute a Security pursuant to Section 8-103(c) of the UCC. With
         respect to any Pledged Collateral consisting of a Securities
         Entitlement or held in a Securities Account, upon execution and
         delivery by the applicable Pledgor, the applicable Securities
         Intermediary and the Collateral Agent of an agreement granting Control
         to the Collateral Agent over such Pledged Collateral, the Collateral
         Agent shall have a second priority perfected security interest in such
         Pledged Collateral. Except as set forth in this Section, no action is
         necessary to perfect or otherwise protect such security interest.

                  (f)      No Other Capital Stock. No Pledgor owns any Capital
         Stock of any Domestic Subsidiary or First-Tier Foreign Subsidiary other
         than as set forth on Schedule 2(a) attached hereto.

                  (g)      Partnership and Limited Liability Company Interests.
         Except as previously disclosed to the Collateral Agent pursuant to
         Section 6(f), none of the Pledged Capital Stock consisting of
         partnership or limited liability company interests (i) is dealt in or
         traded on a securities exchange or in a securities market, (ii) by its
         terms expressly provides that it is a Security governed by Article 8 of
         the UCC, (iii) is an Investment Company Security, (iv) is held in a
         Securities Account or (v) constitutes a "Security" or a "Financial
         Asset" as such terms are defined in Article 8 of the UCC.

                                                                PLEDGE AGREEMENT

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         6.       Covenants. Each Pledgor hereby covenants, that so long as any
of the Pledgor Obligations remain outstanding (other than any such obligations
which by the terms thereof are stated to survive termination of the Note
Documents) or any Note Document is in effect, and until all of Notes shall have
been Paid in Full and the Indenture shall have been terminated (except as
provided in Section 8.01(iii) of the Indenture), such Pledgor shall:

                  (a)      Books and Records. At any time after the Credit
         Agreement is no longer in effect, mark its books and records (and shall
         cause the issuer of the Pledged Capital Stock of such Pledgor to mark
         its books and records) to reflect the security interest granted to the
         Collateral Agent, for the benefit of the Holders, pursuant to this
         Pledge Agreement.

                  (b)      Defense of Title. Warrant and defend title to and
         ownership of the Pledged Collateral of such Pledgor at its own expense
         against the claims and demands of all other parties claiming an
         interest therein, keep the Pledged Collateral free from all Liens,
         except for Permitted Liens, and not sell, exchange, transfer, assign,
         lease or otherwise dispose of Pledged Collateral of such Pledgor or any
         interest therein, except as permitted under the Indenture and the other
         Note Documents.

                  (c)      Further Assurances. Promptly execute and deliver at
         its expense all further instruments and documents and take all further
         action that may be necessary and desirable or that the Collateral Agent
         may reasonably request in order to (i) perfect and protect the security
         interest created hereby in the Pledged Collateral of such Pledgor
         (including, without limitation, the execution and filing of UCC
         financing statements and any and all action necessary to satisfy the
         Collateral Agent that the Collateral Agent has obtained a second
         priority perfected security interest in all Pledged Capital Stock); and
         (ii) enable the Collateral Agent to exercise and enforce its rights and
         remedies hereunder in respect of the Pledged Collateral of such
         Pledgor, including, without limitation and if requested by the
         Collateral Agent after the occurrence and during the continuance of an
         Event of Default, delivering to the Collateral Agent irrevocable
         proxies in respect of the Pledged Collateral of such Pledgor.

                  (d)      Amendments. Not make or consent to any amendment or
         other modification or waiver with respect to any of the Pledged
         Collateral of such Pledgor or enter into any agreement or allow to
         exist any restriction with respect to any of the Pledged Collateral of
         such Pledgor other than pursuant hereto or as may be permitted under
         the Indenture.

                  (e)      Compliance with Securities Laws. File all reports and
         other information now or hereafter required to be filed by such Pledgor
         with the United States Securities and Exchange Commission and any other
         state, federal or foreign agency in connection with the ownership of
         the Pledged Collateral of such Pledgor.

                  (f)      Issuance or Acquisition of Capital Stock. Not,
         without providing 30 days prior written notice to the Collateral Agent
         and without executing and delivering, or causing to be executed and
         delivered, to the Collateral Agent such agreements,

                                                                PLEDGE AGREEMENT

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         documents and instruments as the Collateral Agent may require, issue or
         acquire any Capital Stock consisting of an interest in a partnership or
         a limited liability company that (i) is dealt in or traded on a
         securities exchange or in a securities market, (ii) by its terms
         expressly provides that it is a Security governed by Article 8 of the
         UCC, (iii) is an Investment Company Security, (iv) is held in a
         Securities Account or (v) constitutes a "Security" or a "Financial
         Asset" as such terms are defined in Article 8 of the UCC.

         7.       Performance of Obligations and Advances by Collateral Agent.
On failure of any Pledgor to perform any of the covenants and agreements
contained herein, the Collateral Agent may, at its sole option, perform or cause
to be performed the same and in so doing may expend such sums as the Collateral
Agent may reasonably deem advisable in the performance thereof, including,
without limitation, the payment of any taxes, a payment to obtain a release of a
Lien or potential Lien, expenditures made in defending against any adverse claim
and all other expenditures which the Collateral Agent may make for the
protection of the security hereof or which may be compelled to make by operation
of law. All such sums and amounts so expended shall be repayable by the Pledgors
on a joint and several basis promptly upon timely notice thereof and demand
therefor, shall constitute additional Pledgor Obligations and shall bear
interest from the date said amounts are expended at 11 7/8 % per annum. No such
performance of any covenant or agreement by the Collateral Agent on behalf of
any Pledgor, and no such advance or expenditure therefor, shall relieve the
Pledgors of any default under the terms of this Pledge Agreement or the other
Note Documents. The Collateral Agent may make any payment hereby authorized in
accordance with any bill, statement or estimate procured from the appropriate
public office or holder of the claim to be discharged without inquiry into the
accuracy of such bill, statement or estimate or into the validity of any tax
assessment, sale, forfeiture, tax lien, title or claim except to the extent such
payment is being contested in good faith by a Pledgor in appropriate proceedings
and against which adequate reserves are being maintained in accordance with
GAAP.

         8.       Events of Default. The occurrence of an event which under the
Indenture would constitute an Event of Default shall be an event of default
hereunder (an "Event of Default").

         9.       Remedies.

                  (a)      General Remedies. Upon the occurrence of an Event of
         Default and during the continuation thereof, the Collateral Agent, on
         behalf of the Holders, shall have, in respect of the Pledged Collateral
         of any Pledgor, in addition to the rights and remedies provided herein,
         in the Note Documents and any Holder or by law, the rights and remedies
         of a secured party under the UCC or any other applicable law.

                  (b)      Sale of Pledged Collateral. Upon the occurrence of an
         Event of Default and during the continuation thereof, without limiting
         the generality of this Section and without notice, the Collateral Agent
         may, in its sole discretion, sell or otherwise dispose of or realize
         upon the Pledged Collateral, or any part thereof, in one or more
         parcels, at public or private sale, at any exchange or broker's board
         or elsewhere, at such price or prices and on such other terms as the
         Collateral Agent may deem commercially reasonable, for cash, credit or
         for future delivery or otherwise in accordance with applicable law. To
         the extent permitted by law, any Holder may in such event bid for the

                                                                PLEDGE AGREEMENT

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         purchase of such securities. Each Pledgor agrees that, to the extent
         notice of sale shall be required by law and has not been waived by such
         Pledgor, any requirement of reasonable notice shall be met if notice,
         specifying the place of any public sale or the time after which any
         private sale is to be made, is personally served on or mailed postage
         prepaid to such Pledgor in accordance with the notice provisions of
         Section 12.02 of the Indenture at least 10 days before the time of such
         sale. The Collateral Agent shall not be obligated to make any sale of
         Pledged Collateral of such Pledgor regardless of notice of sale having
         been given. The Collateral Agent may adjourn any public or private sale
         from time to time by announcement at the time and place fixed therefor,
         and such sale may, without further notice, be made at the time and
         place to which it was so adjourned.

                  (c)      Private Sale. Upon the occurrence of an Event of
         Default and during the continuation thereof, the Pledgors recognize
         that the Collateral Agent may deem it impracticable to effect a public
         sale of all or any part of the Pledged Collateral and that the
         Collateral Agent may, therefore, determine to make one or more private
         sales of any such Pledged Collateral to a restricted group of
         purchasers who will be obligated to agree, among other things, to
         acquire such Pledged Collateral for their own account, for investment
         and not with a view to the distribution or resale thereof. Each Pledgor
         acknowledges that any such private sale may be at prices and on terms
         less favorable to the seller than the prices and other terms which
         might have been obtained at a public sale and, notwithstanding the
         foregoing, agrees that such private sale shall not be deemed to have
         been made in a commercially unreasonable manner solely by reason of
         such prices or terms and that the Collateral Agent shall have no
         obligation to delay sale of any such Pledged Collateral for the period
         of time necessary to permit the issuer of such Pledged Collateral to
         register such Pledged Collateral for public sale under the Securities
         Act of 1933. Each Pledgor further acknowledges and agrees that any
         offer to sell such Pledged Collateral which has been (i) publicly
         advertised on a bona fide basis in a newspaper or other publication of
         general circulation in the financial community of New York, New York
         (to the extent that such offer may be advertised without prior
         registration under the Securities Act of 1933), or (ii) made privately
         in the manner described above shall be deemed to involve a "public
         sale" under the UCC, notwithstanding that such sale may not constitute
         a "public offering" under the Securities Act of 1933, and the
         Collateral Agent may, in such event, bid for the purchase of such
         Pledged Collateral.

                  (d)      Retention of Pledged Collateral. In addition to the
         rights and remedies hereunder, upon the occurrence and during the
         continuance of an Event of Default, the Collateral Agent may, after
         providing the notices required by Section 9-621 of the UCC or otherwise
         complying with the requirements of applicable law of the relevant
         jurisdiction, retain all or any portion of the Pledged Collateral in
         satisfaction of the Pledgor Obligations. Unless and until the
         Collateral Agent shall have provided such notices, however, the
         Collateral Agent shall not be deemed to have retained any Pledged
         Collateral in satisfaction of any Pledgor Obligations for any reason.

                  (e)      Deficiency. In the event that the proceeds of any
         sale, collection or realization are insufficient to pay all amounts to
         which the Collateral Agent or the Holders are legally entitled, the
         Pledgors shall be jointly and severally liable for the

                                                                PLEDGE AGREEMENT

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         deficiency, together with interest thereon at 11 7/8 % per annum and
         together with the costs of collection and the reasonable fees of any
         attorneys employed by the Collateral Agent to collect such deficiency.
         Any surplus remaining after the full payment and satisfaction of the
         Pledgor Obligations shall be returned to the Pledgors or to whomsoever
         a court of competent jurisdiction shall determine to be entitled
         thereto.

         10.      Rights of the Collateral Agent.

                  (a)      Power of Attorney. In addition to other powers of
         attorney contained herein, to the fullest extent permitted by
         applicable law, each Pledgor hereby designates and appoints the
         Collateral Agent, on behalf of the Holders, and each of its designees
         or agents as attorney-in-fact of such Pledgor, irrevocably and with
         power of substitution, with authority to take any or all of the
         following actions upon the occurrence and during the continuance of an
         Event of Default:

                           (i)      to demand, collect, settle, compromise,
                  adjust and give discharges and releases concerning the Pledged
                  Collateral of such Pledgor, all as the Collateral Agent may
                  reasonably determine;

                           (ii)     to commence and prosecute any actions at any
                  court for the purposes of collecting any of the Pledged
                  Collateral of such Pledgor and enforcing any other right in
                  respect thereof;

                           (iii)    to defend, settle, adjust or compromise any
                  action, suit or proceeding brought and, in connection
                  therewith, give such discharge or release as the Collateral
                  Agent may deem reasonably appropriate;

                           (iv)     to pay or discharge taxes, liens, security
                  interests, or other encumbrances levied or placed on or
                  threatened against the Pledged Collateral of such Pledgor;

                           (v)      to direct any parties liable for any payment
                  under any of the Pledged Collateral to make payment of any and
                  all monies due and to become due thereunder directly to the
                  Collateral Agent or as the Collateral Agent shall direct;

                           (vi)     to receive payment of and receipt for any
                  and all monies, claims, and other amounts due and to become
                  due at any time in respect of or arising out of any Pledged
                  Collateral of such Pledgor;

                           (vii)    to sign and endorse any drafts, assignments,
                  proxies, stock powers, verifications, notices and other
                  documents relating to the Pledged Collateral of such Pledgor;

                           (viii)   to execute and deliver all assignments,
                  conveyances, statements, financing statements, renewal
                  financing statements, pledge agreements, affidavits, notices
                  and other agreements, instruments and documents that the
                  Collateral

                                                                PLEDGE AGREEMENT

<PAGE>

                  Agent may determine necessary in order to perfect and maintain
                  the security interests and liens granted in this Pledge
                  Agreement and in order to fully consummate all of the
                  transactions contemplated herein;

                           (ix)     to exchange any of the Pledged Collateral of
                  such Pledgor or other property upon any merger, consolidation,
                  reorganization, recapitalization or other readjustment of the
                  issuer thereof and, in connection therewith, deposit any of
                  the Pledged Collateral of such Pledgor with any committee,
                  depository, transfer agent, registrar or other designated
                  agency upon such terms as the Collateral Agent may determine;

                           (x)      to vote for a shareholder, partner or member
                  resolution, or to sign an instrument in writing, sanctioning
                  the transfer of any or all of the Pledged Capital Stock of
                  such Pledgor into the name of the Collateral Agent or one or
                  more of the Holders or into the name of any transferee to whom
                  the Pledged Capital Stock of such Pledgor or any part thereof
                  may be sold pursuant to Section 9 hereof; and

                           (xi)     to do and perform all such other acts and
                  things as the Collateral Agent may reasonably deem to be
                  necessary, proper or convenient in connection with the Pledged
                  Collateral of such Pledgor.

         This power of attorney is a power coupled with an interest and shall be
         irrevocable (i) for so long as any of the Pledgor Obligations remain
         outstanding (other than any such obligations which by the terms thereof
         are stated to survive termination of the Note Documents) or any Note
         Document is in effect and (ii) until all of Notes shall have been Paid
         in Full and the Indenture shall have been terminated (except as
         provided in Section 8.01(iii) of the Indenture). The Collateral Agent
         shall be under no duty to exercise or withhold the exercise of any of
         the rights, powers, privileges and options expressly or implicitly
         granted to the Collateral Agent in this Pledge Agreement and shall not
         be liable for any failure to do so or any delay in doing so. The
         Collateral Agent shall not be liable for any act or omission or for any
         error of judgment or any mistake of fact or law in its individual
         capacity or its capacity as attorney-in-fact except acts or omissions
         resulting from its gross negligence or willful misconduct. This power
         of attorney is conferred on the Collateral Agent solely to protect,
         preserve and realize upon its security interest in the Pledged
         Collateral.

                  (b)      Assignment by the Collateral Agent. Subject to the
         terms of the Indenture, the Collateral Agent may from time to time
         assign the Pledgor Obligations or any portion thereof and/or the
         Pledged Collateral or any portion thereof, and the assignee shall be
         entitled to all of the rights and remedies of the Collateral Agent
         under this Pledge Agreement in relation thereto.

                  (c)      The Collateral Agent's Duty of Care. Other than the
         exercise of reasonable care to ensure the safe custody of the Pledged
         Collateral while being held by the Collateral Agent hereunder, the
         Collateral Agent shall have no duty or liability to

                                                                PLEDGE AGREEMENT

<PAGE>

         preserve rights pertaining thereto, it being understood and agreed that
         each of the Pledgors shall be responsible for preservation of all
         rights in the Pledged Collateral of such Pledgor, and the Collateral
         Agent shall be relieved of all responsibility for such Pledged
         Collateral upon surrendering it or tendering the surrender of it to
         such Pledgor. The Collateral Agent shall be deemed to have exercised
         reasonable care in the custody and preservation of the Pledged
         Collateral in its possession if such Pledged Collateral is accorded
         treatment substantially equal to that which the Collateral Agent
         accords its own property, which shall be no less than the treatment
         employed by a reasonable and prudent agent in the industry, it being
         understood that the Collateral Agent shall not have responsibility for
         (i) ascertaining or taking action with respect to calls, conversions,
         exchanges, maturities, tenders or other matters relating to any Pledged
         Collateral, whether or not the Collateral Agent has or is deemed to
         have knowledge of such matters; or (ii) taking any necessary steps to
         preserve rights against any parties with respect to any Pledged
         Collateral.

                  (d)      Voting Rights in Respect of the Pledged Collateral.

                           (i)      So long as no Event of Default shall have
                  occurred and be continuing, to the extent permitted by law,
                  each Pledgor may exercise any and all voting and other
                  consensual rights pertaining to the Pledged Collateral of such
                  Pledgor or any part thereof for any purpose not inconsistent
                  with the terms of this Pledge Agreement or the Indenture; and

                           (ii)     Upon the occurrence and during the
                  continuance of an Event of Default, all rights of a Pledgor to
                  exercise the voting and other consensual rights which it would
                  otherwise be entitled to exercise pursuant to subsection (i)
                  of this Section shall cease and all such rights shall
                  thereupon become vested in the Collateral Agent which shall
                  then have the sole right to exercise such voting and other
                  consensual rights.

                  (e)      Dividend and Distribution Rights in Respect of the
         Pledged Collateral.

                           (i)      So long as no Event of Default shall have
                  occurred and be continuing and subject to Section 4(b) hereof,
                  each Pledgor may receive and retain any and all dividends
                  (other than stock dividends and other dividends constituting
                  Pledged Collateral which are addressed hereinabove),
                  distributions or interest paid in respect of the Pledged
                  Collateral to the extent not prohibited under the Indenture.

                           (ii)     Upon the occurrence and during the
                  continuance of an Event of Default:

                                    (A)      all rights of a Pledgor to receive
                           the dividends, distributions and interest payments
                           which it would otherwise be authorized to receive and
                           retain pursuant to subsection (i) of this Section
                           shall cease and all such rights shall thereupon be
                           vested in the Collateral Agent which shall then

                                                                PLEDGE AGREEMENT

<PAGE>

                           have the sole right to receive and hold as Pledged
                           Collateral such dividends, distributions and interest
                           payments; and

                                    (B)      all dividends, distributions and
                           interest payments which are received by a Pledgor
                           contrary to the provisions of subsection (A) of this
                           Section shall be received in trust for the benefit of
                           the Collateral Agent, shall be segregated from other
                           property or funds of such Pledgor, and shall be
                           forthwith paid over to the Collateral Agent as
                           Pledged Collateral in the exact form received, to be
                           held by the Collateral Agent as Pledged Collateral
                           and as further collateral security for the Pledgor
                           Obligations.

                  (f)      Release of Pledged Collateral. The Collateral Agent
         may release any of the Pledged Collateral from this Pledge Agreement or
         may substitute any of the Pledged Collateral for other Pledged
         Collateral in connection with a transaction permitted by the Indenture
         without altering, varying or diminishing in any way the force, effect,
         lien, pledge or security interest of this Pledge Agreement as to any
         Pledged Collateral not expressly released or substituted, and this
         Pledge Agreement shall continue as a second priority lien on all
         Pledged Collateral not expressly released or substituted.

                  (g)      Provisions Concerning the Collateral Agent. The
         provisions of Section 10 of the Security Agreement shall apply to the
         Collateral Agent as if fully set forth herein.

         11.      Application of Proceeds. Upon the occurrence and during the
continuance of an Event of Default, any payments in respect of the Pledgor
Obligations and any proceeds of any Pledged Collateral, when received by the
Collateral Agent or any of the Holders in cash or its equivalent, subject to the
Intercreditor Agreement, will be applied in reduction of the Pledgor Obligations
in the order set forth in Section 6.10 of the Indenture, and each Pledgor
irrevocably waives the right to direct the application of such payments and
proceeds.

         12.      Costs of Counsel. At all times hereafter, whether or not an
Event of Default exists, the Pledgors agree to promptly pay upon demand any and
all reasonable costs and expenses of the Collateral Agent or the Holders, (a) as
required under Section 7.07 of the Indenture and (b) as necessary to protect the
Collateral or to exercise any rights or remedies under this Pledge Agreement or
with respect to any Collateral. All of the foregoing costs and expenses shall
constitute Pledgor Obligations hereunder.

         13.      Continuing Agreement.

                  (a)      This Pledge Agreement shall be a continuing agreement
         in every respect and shall remain in full force and effect so long as
         any of the Pledgor Obligations remain outstanding (other than any such
         obligations which by the terms thereof are stated to survive
         termination of the Note Documents) or any Note Document is in effect,
         and until all of Notes shall have been Paid in Full and the Indenture
         shall have been terminated (except as provided in Section 8.01(iii) of
         the Indenture). Upon such payment and termination, the Collateral
         Agent, on behalf of the Holders, shall, upon the request and at the
         expense of the Pledgors, forthwith release all of their Liens and
         security interests hereunder and shall

                                                                PLEDGE AGREEMENT

<PAGE>

         execute and deliver all UCC termination statements and/or other
         documents reasonably requested by the Pledgors evidencing such
         termination. Notwithstanding the foregoing, all releases and
         indemnities provided hereunder shall survive termination of this Pledge
         Agreement.

                  (b)      This Pledge Agreement shall continue to be effective
         or be automatically reinstated, as the case may be, if at any time
         payment, in whole or in part, of any of the Pledgor Obligations is
         rescinded or must otherwise be restored or returned by the Collateral
         Agent or any Holder as a preference, fraudulent conveyance or otherwise
         under any bankruptcy, insolvency or similar law, all as though such
         payment had not been made; provided that in the event payment of all or
         any part of the Pledgor Obligations is rescinded or must be restored or
         returned, all reasonable costs and expenses (including without
         limitation any reasonable legal fees and disbursements) incurred by the
         Collateral Agent or any Holder in defending and enforcing such
         reinstatement shall be deemed to be included as a part of the Pledgor
         Obligations.

         14.      Amendments; Waivers; Modifications. This Pledge Agreement and
the provisions hereof may not be amended, waived, modified, changed, discharged
or terminated except as set forth in Section 2.2 of the Intercreditor Agreement
and Article 9 of the Indenture.

         15.      Successors in Interest. This Pledge Agreement shall create a
continuing security interest in the Collateral and shall be binding upon each
Pledgor, its successors and assigns and shall inure, together with the rights
and remedies of the Collateral Agent and the Holders hereunder, to the benefit
of the Collateral Agent and the Holders and their successors and permitted
assigns; provided, however, that none of the Pledgors may assign its rights or
delegate its duties hereunder except as permitted by the Indenture. To the
fullest extent permitted by law, each Pledgor hereby releases the Collateral
Agent and each Holder, and its successors and assigns, from any liability for
any act or omission relating to this Pledge Agreement or the Collateral, except
for any liability arising from the gross negligence or willful misconduct of the
Collateral Agent, or such Holder, or its officers, employees or agents.

         16.      Notices. All notices required or permitted to be given under
this Pledge Agreement shall be in conformance with Section 12.02 of the
Indenture.

         17.      Counterparts; Telecopy. This Pledge Agreement may be executed
in any number of counterparts, each of which where so executed and delivered
shall be an original, but all of which shall constitute one and the same
instrument. It shall not be necessary in making proof of this Pledge Agreement
to produce or account for more than one such counterpart. Delivery of an
executed counterpart by facsimile shall be as effective as an original executed
counterpart and shall be deemed a representation that an original executed
counterpart will be delivered.

         18.      Headings. The headings of the sections and subsections hereof
are provided for convenience only and shall not in any way affect the meaning,
construction or interpretation of any provision of this Pledge Agreement.

                                                                PLEDGE AGREEMENT

<PAGE>

         19.      Governing Law; Submission to Jurisdiction; Venue.

                  (a)      THIS PLEDGE AGREEMENT AND THE RIGHTS AND OBLIGATIONS
         OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND
         INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. Any
         legal action or proceeding with respect to this Pledge Agreement may be
         brought in the courts of the State of New York, or of the United States
         for the Southern District of New York, and, by execution and delivery
         of this Pledge Agreement, each Pledgor hereby irrevocably accepts for
         itself and in respect of its property, generally and unconditionally,
         the jurisdiction of such courts. Each Pledgor further irrevocably
         consents to the service of process out of any of the aforementioned
         courts in any such action or proceeding by the mailing of copies
         thereof by registered or certified mail, postage prepaid, to it at the
         address for notices pursuant to Section 12.02 of the Indenture, such
         service to become effective 30 days after such mailing. Nothing herein
         shall affect the right of the Collateral Agent to serve process in any
         other manner permitted by law or to commence legal proceedings or to
         otherwise proceed against any Pledgor in any other jurisdiction.

                  (b)      Each Pledgor hereby irrevocably waives any objection
         which it may now or hereafter have to the laying of venue of any of the
         aforesaid actions or proceedings arising out of or in connection with
         this Pledge Agreement brought in the courts referred to in subsection
         (a) hereof and hereby further irrevocably waives and agrees not to
         plead or claim in any such court that any such action or proceeding
         brought in any such court has been brought in an inconvenient forum.

         20.      Waiver of Jury Trial; Waiver of Consequential Damages. EACH OF
THE PARTIES TO THIS PLEDGE AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO
TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR
RELATING TO THIS PLEDGE AGREEMENT, ANY OF THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY. Each Pledgor agrees not to assert any claim
against the Agents, any Holder, any of their Affiliates, or any of their
respective directors, officers, employees, attorneys or agents, on any theory of
liability, for special, indirect, consequential or punitive damages arising out
of or otherwise relating to any of the transactions contemplated herein.

         21.      Severability. If any provision of this Pledge Agreement is
determined to be illegal, invalid or unenforceable, such provision shall be
fully severable and the remaining provisions shall remain in full force and
effect and shall be construed without giving effect to the illegal, invalid or
unenforceable provisions.

         22.      Entirety. This Pledge Agreement together with the other Note
Documents represent the entire agreement of the parties hereto and thereto, and
supersede all prior agreements and understandings, oral or written, if any,
including any commitment letters or correspondence relating to the Note
Documents or the transactions contemplated herein and therein.

                                                                PLEDGE AGREEMENT

<PAGE>

         23.      Survival. All representations and warranties of the Pledgors
hereunder shall survive the execution and delivery of this Pledge Agreement and
the other Note Documents and the issuance of the Notes.

         24.      Other Security. To the extent that any of the Pledgor
Obligations are now or hereafter secured by property other than the Pledged
Collateral (including, without limitation, real and other personal property
owned by a Pledgor), or by a guarantee, endorsement or property of any other
Person, then the Collateral Agent, on behalf of the Holders, shall have the
right to proceed against such other property, guarantee or endorsement upon the
occurrence of any Event of Default, and the Collateral Agent and the Holders
have the right, in their sole discretion, to determine which rights, security,
liens, security interests or remedies the Collateral Agent, on behalf of the
Holders, shall at any time pursue, relinquish, subordinate, modify or take with
respect thereto, without in any way modifying or affecting any of them or any of
the Collateral Agent's and the Holders' rights or the Pledgor Obligations under
this Pledge Agreement, under any other of the Note Documents.

         25.      Priority of Liens. The relative priority of the security
interests with respect to certain of the Pledged Collateral is governed by the
terms of the Intercreditor Agreement. This Pledge Agreement and the Liens
granted herein will be junior in priority to the First Priority Liens (as
defined in the Intercreditor Agreement) in the manner and to the extent set
forth in the Intercreditor Agreement. This Pledge Agreement shall automatically
be amended and the Collateral covered hereunder (or portion thereof)
automatically released upon the terms and conditions set forth in Section 2.2 of
the Intercreditor Agreement. To the extent of any inconsistency between the
terms of the Intercreditor Agreement and this Pledge Agreement, the terms of the
Intercreditor Agreement shall govern.

         26.      Delivery to Senior Agent. Notwithstanding any other provision
of this Pledge Agreement, during the term of the Credit Agreement, in the event
any requirement hereunder of an Obligor to deliver or cause to be delivered any
agreement, instrument, Pledged Collateral or other document to the Collateral
Agent is also a requirement of such Obligor under the terms of the Credit
Agreement, such requirement hereunder shall be deemed to be satisfied upon the
delivery of such agreement, instrument, Pledged Collateral or other document to
the Senior Agent pursuant to the terms of the Credit Agreement.

                                                                PLEDGE AGREEMENT

<PAGE>

         Each of the parties hereto has caused a counterpart of this Pledge
Agreement to be duly executed and delivered as of the date first above written.

PLEDGORS:

                                            UNITED STATES CAN COMPANY,
                                            a Delaware corporation

                                            By: /s/ Sandra K. Vollman
                                            Name: Sandra K. Vollman
                                            Title: Sr. VP and CFO

                                            U.S. CAN CORPORATION,
                                            a Delaware corporation

                                            By: /s/ Sandra K. Vollman
                                            Name: Sandra K. Vollman
                                            Title: Sr. VP and CFO

                                            USC MAY VERPACKUNGEN HOLDING, INC.,
                                            a Delaware corporation

                                            By: /s/ Sandra K. Vollman
                                            Name: Sandra K. Vollman
                                            Title: Sr. VP and CFO

                                                                PLEDGE AGREEMENT

<PAGE>

         Accepted and agreed to as of the date first above written.

                                            WELLS FARGO BANK MINNESOTA,
                                            NATIONAL ASSOCIATION,
                                            as Collateral Agent

                                            By:    /s/ Jane Y. Schweiger
                                            Name:  Jane Y. Schweiger
                                            Title: Vice President

                                                                PLEDGE AGREEMENT

<PAGE>

                                  Schedule 2(a)

                                       to

                                Pledge Agreement

                      dated as of July 22, 2003 in favor of

                Wells Fargo Bank Minnesota, National Association,

                               as Collateral Agent

                              PLEDGED CAPITAL STOCK

PLEDGOR:  U.S. CAN CORPORATION

<TABLE>
<CAPTION>
          Name of                       Number of            Certificate          Percentage       Percentage
   Domestic Subsidiary                    Shares                Number            Ownership         Pledged
   -------------------                    ------                ------            ---------         -------
<S>                                     <C>                  <C>                  <C>              <C>
United States Can Company                  1000                   7                  100%             100%
</TABLE>

PLEDGOR:  UNITED STATES CAN COMPANY

<TABLE>
<CAPTION>
              Name of                   Number of            Certificate          Percentage       Percentage
       Domestic Subsidiary                Shares                Number            Ownership         Pledged
       -------------------                ------                ------            ---------         -------
<S>                                     <C>                  <C>                  <C>              <C>
USC May Verpackungen                       100                    1                  100%             100%
Holding Inc.
</TABLE>

<TABLE>
<CAPTION>
      Name of                           Number of            Certificate          Percentage         Percentage
Foreign Subsidiary                        Shares                Number            Ownership           Pledged
------------------                        ------                ------            ---------           -------
<S>                                     <C>                  <C>                  <C>               <C>
U.S.C. Europe N.V.                         3900                   2                  100%           100% (subject to
                                           2100                   3                                 limitations in
                                              1                   4                                 Section 3)
                                              1                   5
</TABLE>

<PAGE>

PLEDGOR:  USC MAY VERPACKUNGEN HOLDING INC.

<TABLE>
<CAPTION>
       Name of                        Number of            Certificate          Percentage           Percentage
  Foreign Subsidiary                    Shares                Number            Ownership             Pledged
  ------------------                    ------                ------            ---------             -------
<S>                                   <C>                  <C>                  <C>                <C>
May Verpackungen GmbH &                   N/A                   N/A                100%            100% (subject to
Co., KG                                                                                              limitations in
                                                                                                     Section 3)
</TABLE>

<PAGE>

                                  Exhibit 4(a)

                                       to

                                Pledge Agreement

                      dated as of July 22, 2003 in favor of

                Wells Fargo Bank Minnesota, National Association,

                               as Collateral Agent

                             Irrevocable Stock Power

   FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers to

the following shares of capital stock of _____________________, a ____________
corporation:

         No. of Shares                                 Certificate No.

and irrevocably appoints __________________________________ its agent and
attorney-in-fact to transfer all or any part of such capital stock and to take
all necessary and appropriate action to effect any such transfer. The agent and
attorney-in-fact may substitute and appoint one or more persons to act for him.

                                            ______________,
                                            a ______________ corporation

                                            By:_________________________________
                                            Name:_______________________________
                                            Title: _____________________________<PAGE>

                                                                   EXHIBIT 10.32

                          LIEN INTERCREDITOR AGREEMENT

         This LIEN INTERCREDITOR AGREEMENT (as it may be as amended, modified,
restated or supplemented from time to time, the "Agreement"), dated as of July
22, 2003, is entered into among Wells Fargo Bank Minnesota, National
Association, as trustee and collateral agent (in such capacity, the "Trustee")
on behalf of the Senior Noteholders (hereinafter defined), Bank of America,
N.A., in its capacity as agent (in such capacity, the "Senior Agent") for the
financial institutions party to the credit agreement described below (the
"Senior Lenders"), United States Can Company, a Delaware corporation (the
"Borrower") and U.S. Can Corporation, a Delaware corporation, and certain
Subsidiaries of the Borrower (collectively, the "Guarantors").

                              W I T N E S S E T H:

         WHEREAS, the Senior Lenders heretofore have made, and have agreed to
make from time to time hereafter, certain extensions of credit (the "Senior
Loans") pursuant to and/or as evidenced by (i) that certain Credit Agreement,
dated as of October 4, 2000, by and among the Senior Lenders from time to time
party thereto, the Senior Agent, the Borrower and the Guarantors (as amended,
modified, extended, renewed, restated, replaced or increased from time to time,
the "Senior Credit Agreement"), and (ii) those certain promissory notes related
thereto.

         WHEREAS, the Senior Lenders and/or certain of their respective
affiliates heretofore have entered into, and/or may enter into from time to time
hereafter, certain interest rate protection agreements, foreign exchange
contracts, currency swap agreements, commodity purchase or option agreements or
other interest or exchange rate or commodity price hedging agreements or other
similar agreements, designed to protect a Credit Party (as hereinafter defined)
or any of its Subsidiaries against fluctuations in currency or interest rates
(as amended, modified, extended, renewed, restated or replaced from time to
time, the "Hedging Agreements").

         WHEREAS, the Guarantors (including all future subsidiaries of the
Borrower which become a Guarantor under the Senior Credit Agreement by execution
of a Joinder Agreement (as defined in the Senior Credit Agreement)) have
guaranteed all of the obligations of the Borrower to the Senior Lenders under
the Senior Credit Agreement and the Hedging Agreements pursuant to the terms of
Section 4 of the Senior Credit Agreement (the guaranty contained in Section 4 of
the Senior Credit Agreement, as amended, modified, extended, renewed, restated
or replaced from time to time, the "Senior Lender Guarantee").

         WHEREAS, the obligations of the Borrower and the Guarantors
(collectively, the "Credit Parties") under the Senior Credit Agreement, the
Hedging Agreements and the Senior Lender Guarantee are secured, pursuant to the
terms of various mortgages, deeds of trust, deeds to secure debt, security
agreements, pledge agreements and other collateral documents executed by the
Credit Parties in favor of the Senior Agent for the benefit of the Senior
Lenders (collectively, as the same may be amended, supplemented, modified or
replaced from time to time, the "Senior Collateral Documents"), by first liens
on and security interests in, inter alia, (a)

<PAGE>

all or substantially all of the real property, plant, and improvements now owned
or hereafter acquired by the Credit Parties, including without limitation all
material manufacturing facilities owned by the Credit Parties, all as more
specifically described in the Senior Collateral Documents; (b) all or
substantially all of the personal property, now owned or hereafter acquired by
the Credit Parties, including without limitation cash, securities, inventory,
accounts, equipment, goods, documents, and instruments, all as more specifically
described in the Senior Collateral Documents; and (c) all or substantially all
of the intangible property of the Credit Parties, now owned or hereafter
acquired, including without limitation all general intangibles, patents,
trademarks, tax refunds, copyrights and other intangible property, all as more
specifically described in the Senior Collateral Documents (collectively,
together with all proceeds, products, accessions, additions, improvements and
attachments thereto from time to time, including without limitation all
insurance proceeds, shall be referred to herein collectively as the
"Collateral").

         WHEREAS, the Credit Parties have requested that the Senior Agent and
the Senior Lenders enter into that certain amendment to the Senior Credit
Agreement of even date herewith (the "Senior Amendment"), pursuant to which the
Senior Lenders would approve, among other changes to the Senior Credit
Agreement, the Borrower's issuance of up to $125,000,000 10 7/8% Senior Secured
Notes due 2010 (as amended, modified, extended, renewed, restated or replaced
from time to time, together with any notes issued in substitution or exchange
therefor, the "Senior Notes") under the terms of that certain Indenture dated as
of the date hereof (as amended, modified, extended, renewed, restated or
replaced from time to time hereafter, the "Indenture") between the Borrower and
the Trustee, on behalf of each of the holders of the Senior Notes (together with
their successors and assigns, the "Senior Noteholders").

         WHEREAS, the Guarantors (including all future Subsidiaries of the
Borrower which become a party thereto by execution of a Guarantee Supplement (as
defined in the Indenture)) have guaranteed the obligations of the Borrower under
the Senior Notes and the Indenture pursuant to the terms of that certain
Subsidiaries Guarantee dated as of July 22, 2003 (as amended, modified,
extended, renewed, restated or replaced from time to time hereinafter, the
"Senior Note Guarantee").

         WHEREAS, the obligations of the Borrower and the Guarantors under the
Indenture, the Senior Notes and the Senior Note Guarantee are secured pursuant
to the terms of various mortgages, deeds of trust, deeds to secure debt, pledge
agreements, security agreements and other collateral documents executed by the
Credit Parties in favor of the Senior Noteholders (collectively, as the same may
be amended, supplemented, modified or replaced from time to time, the "Second
Lien Collateral Documents") by second liens on and security interests in the
Collateral;

         WHEREAS, the Senior Agent, for itself and on behalf of the Senior
Lenders, and the Senior Noteholders desire to enter into this Agreement to
evidence their agreement with respect to, among other things, the relative
priorities of their respective security interests in and liens on the
Collateral.

         NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, and to induce the

                                       2
<PAGE>

Senior Agent and the Senior Lenders to enter into the Senior Amendment, and to
induce the Senior Noteholders to purchase the Senior Notes, the parties hereto
hereby agree as follows:

                                    ARTICLE I

                                   DEFINITIONS

         Section 1.1 Capitalized terms used herein and not otherwise defined
herein shall have the meanings assigned to such terms in the Recitals of this
Agreement.

         Section 1.2 For purposes of this Agreement, the following terms shall
have the following meanings:

         "Agreement" means this Intercreditor Agreement, as amended,
supplemented or otherwise modified from time to time.

         "Bankruptcy Event" means, the occurrence of any of the following: (a) a
court or governmental agency having jurisdiction in the premises shall enter a
decree or order for relief in respect of any Credit Party or any of its
Subsidiaries in an involuntary case under any applicable bankruptcy, insolvency
or other similar law now or hereafter in effect, or appoint a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar official of
any Credit Party or any of its Subsidiaries or for any substantial part of its
property or ordering the winding up or liquidation of its affairs; or (b) an
involuntary case under any applicable bankruptcy, insolvency or other similar
law now or hereafter in effect is commenced against any Credit Party or any of
its Subsidiaries and such petition remains unstayed and in effect for a period
of 60 consecutive days; or (c) any Credit Party or any of its Subsidiaries shall
commence a voluntary case under any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect, or consent to the entry of an order for
relief in an involuntary case under any such law, or consent to the appointment
or taking possession by a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of such Person or any substantial part of its
property or make any general assignment for the benefit of creditors; or (d) any
Credit Party or any of its Subsidiaries shall admit in writing its inability to
pay its debts generally as they become due or any action shall be taken by such
Person in furtherance of any of the aforesaid purposes.

         "Business Day" means any day other than a Saturday, a Sunday, a legal
holiday or a day on which banking institutions are authorized or required by law
or other governmental action to close in San Francisco, California, New York,
New York or the location of the principal office of the Trustee.

         "First Lien Indebtedness" means (a) the collective reference to the
principal of and interest on (including, without limitation, interest accruing
at the then applicable rate provided in the Senior Credit Agreement after the
maturity of the Senior Loans and interest accruing at the then applicable rate
provided in the Senior Credit Agreement after the commencement of any Bankruptcy
Event or like proceeding, whether or not a claim for post-filing or
post-petition interest is allowed in such proceeding) the Senior Loans and all
other obligations and liabilities of the Credit Parties to the Senior Lenders or
the Senior Agent under or in connection with the

                                       3
<PAGE>

Senior Credit Agreement, the Senior Lender Guarantee, the Senior Collateral
Documents or any other loan, credit or collateral document (as the same may be
amended, restated, revised, supplemented or otherwise modified from time to
time) entered into by any Credit Party and relating to the Senior Loans, whether
on account of principal, interest, reimbursement obligations, fees, indemnities,
costs, expenses or otherwise (including, without limitation, all fees and
disbursements of the Senior Agent and the Senior Lenders and legal counsel to
each of the foregoing that are required to be paid by the Credit Parties
pursuant to the terms of the Senior Credit Agreement, any Senior Collateral
Document, this Agreement or any other loan, credit or collateral document
entered into by any Credit Party and relating to the Senior Loans), (b) the
collective reference to all obligations and liabilities of the Credit Parties
and their Subsidiaries under Hedging Agreements, whether on account of
principal, interest (including, without limitation, interest accruing at the
then applicable rate provided in such Hedging Agreements after the termination
thereof and interest accruing at the then applicable rate provided in such
Hedging Agreements after the commencement of any Bankruptcy Event or like
proceeding, whether or not a claim for post-filing or post-petition interest is
allowed in such proceeding), reimbursement obligations, fees, indemnities,
costs, expenses, premiums, scheduled periodic payments, breakage, termination or
other payments, or otherwise (including, without limitation, all fees and
disbursements of the Senior Agent and the providers of such Hedging Agreements
and legal counsel to each of the foregoing that are required to be paid by the
Credit Parties pursuant to the terms of such Hedging Agreements, the Senior
Credit Agreement, any Senior Collateral Document, this Agreement or any other
loan, credit or collateral document entered into by any Credit Party and related
to any such Hedging Agreement) and (c) to the extent not prohibited by the
Indenture, all renewals, extensions, refundings, restructurings, replacements
and other refinancings thereof, whether with the original agent or lenders or
pursuant to the original credit agreement or another credit agreement or
indenture. For purposes of this definition, (a) the principal amount of the
Senior Credit Agreement (including unfunded commitments under the revolving
credit facility thereunder) on the date hereof (after giving effect to the
payment of the term loans thereunder with the proceeds of the Senior Notes) is
$279,500,000, and any increase to the outstanding principal amount of the term
loans thereunder and any increase to the aggregate commitments available to be
drawn under the revolving credit facility thereunder (after giving effect to any
permanent reductions thereto in connection with any asset sales occurring after
the date hereof) shall only constitute First Lien Indebtedness to the extent
such increases are permitted by the Indenture and (b) any obligations and
liabilities under Hedging Agreements entered after the date of this Agreement
shall only constitute First Lien Indebtedness to the extent such Hedging
Agreements are permitted by the Indenture.

         "First Priority Liens" shall have the meaning ascribed to such term in
Section 2.1.

         "Noteholder Documents" means, collectively, the Indenture, the Senior
Notes and the Second Lien Collateral Documents.

         "Paid in Full" or "Payment in Full" means, with respect to the First
Lien Indebtedness, that (a) all First Lien Indebtedness has been paid in full in
cash (and all letter of credit obligations outstanding under the Senior Credit
Agreement have been paid in full in cash or cash collateralized) and satisfied,
(b) the commitments of the Senior Lenders to make loans or other extensions of
credit to the Borrower under the Senior Credit Agreement or any other credit

                                       4
<PAGE>

document executed in connection therewith have been terminated and (c) all
Hedging Agreements have been terminated.

         "Person" means any individual, partnership, joint venture, firm,
corporation, limited liability company, association, trust or other enterprise
(whether or not incorporated), or any governmental agency or authority.

         "Required Senior Lenders" means the "Required Lenders", as such term is
defined in the Senior Credit Agreement.

         "Second Lien Indebtedness" means (a) the collective reference to the
principal of and interest on (including, without limitation, interest accruing
at the then applicable rate provided in the Indenture or the Senior Notes after
the maturity of the Senior Notes and interest accruing at the then applicable
rate provided in the Indenture or the Senior Notes after the commencement of any
Bankruptcy Event or like proceeding) the Senior Notes and all other obligations
and liabilities of the Credit Parties to the Trustee or the Senior Noteholders
under or in connection with the Indenture, the Senior Notes, the Senior
Noteholder Guarantee, the Second Lien Collateral Documents or any other note or
collateral document (as the same may be amended, restated, revised, supplemented
or otherwise modified from time to time) entered into by any Credit Party and
relating to the Senior Notes, whether on account of principal, interest,
reimbursement obligations, fees, indemnities, costs, expenses or otherwise
(including, without limitation, all fees and disbursements of the Trustee and
the Senior Noteholders and legal counsel to each of the foregoing that are
required to be paid by the Credit Parties pursuant to the terms of the
Indenture, any Second Lien Collateral Document, this Agreement or any other note
or collateral document entered into by any Credit Party and relating to the
Senior Notes) and (b) all renewals, extensions, refundings, restructurings and
other refinancings thereof.

         "Second Priority Liens" shall have the meaning ascribed to such term in
Section 2.1.

         "Subsidiary" means, as to any Person, (a) any corporation more than 50%
of whose stock of any class or classes having by the terms thereof ordinary
voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time, any class or classes of such
corporation shall have or might have voting power by reason of the happening of
any contingency) is at the time owned by such Person directly or indirectly
through Subsidiaries, and (b) any partnership, limited liability company,
association, joint venture or other entity in which such Person directly or
indirectly through Subsidiaries has more than a 50% equity interest at any time.

                                   ARTICLE II

                      GENERAL LIEN INTERCREDITOR PROVISIONS

         Section 2.1 Agreement with Respect to Liens. The Senior Agent, for
itself, the Senior Lenders and their respective successors and assigns, hereby
acknowledges that the Senior Noteholders have been granted liens on and security
interests in the Collateral pursuant to the Second Lien Collateral Documents.
Each Credit Party, for itself and its successors and assigns,

                                       5
<PAGE>

covenants and agrees, and the Trustee, for itself, the Senior Noteholders and
their respective successors and assigns, hereby agrees that, to the extent and
in the manner set forth in this Article, all liens now held or hereafter
acquired by Senior Agent or any of the Senior Lenders in any or all of the
Collateral (the "First Priority Liens") to secure the First Lien Indebtedness
shall at all times be prior and senior to any lien now held or hereafter
acquired by the Trustee or any of the Senior Noteholders in the Collateral (the
"Second Priority Liens"). Such priority shall be applicable irrespective of the
time or order of attachment or perfection of any security interest or the time
or order of filing of any financing statements, deeds of trust or other
documents, or any statutes, rules of law, or judicial interpretations to the
contrary. The provisions in this Agreement are for the benefit of and shall be
enforceable directly by the Senior Agent and the Senior Lenders. The Senior
Agent and the Senior Lenders shall be deemed to have entered into the Senior
Amendment in reliance upon this Agreement.

         Section 2.2 Releases; Amendments to Noteholder Documents.

                  (a)      If in connection with:

                           (i)      the exercise of the Senior Agent's remedies
                  in respect of the Collateral provided for in Section 2.3 (but
                  subject to the proviso in the first sentence thereof),
                  including any sale, lease, exchange, transfer or other
                  disposition of such Collateral;

                           (ii)     any sale, lease, exchange, transfer or other
                  disposition of Collateral permitted under the terms of the
                  Senior Credit Agreement (whether or not an event of default
                  under, and as defined therein, has occurred and is continuing)
                  and permitted or not prohibited under Section 4.06 of the
                  Indenture (Limitation on Asset Dispositions); or

                           (iii)    any agreement between the Senior Agent and
                  any Credit Party to release the Senior Agent's lien on any
                  portion of the Collateral or to release any Guarantor from its
                  obligations under its guaranty of the First Lien Indebtedness,
                  unless an event of default exists under the Noteholder
                  Documents or such release would be prevented by Section
                  2.2(a)(ii) above or the event giving rise to the agreement to
                  release Collateral would cause an event of default under the
                  Noteholder Documents other than the general covenant that the
                  Borrower maintain a second priority lien on the Collateral
                  contemplated by the Indenture;

         the Senior Agent, for itself or on behalf of any of the Senior Lenders,
         releases any of its liens on any part of the Collateral (or any
         Guarantor from its obligations under its guaranty of the First Lien
         Indebtedness), the liens, if any, of the Trustee, for itself or for the
         benefit of the Senior Noteholders, on such Collateral (and the
         obligations of such Guarantor under its guaranty of the Second Lien
         Indebtedness) shall be automatically, unconditionally and
         simultaneously released (except as provided in the last sentence of
         Section 2.2(e)) and the Trustee, for itself or on behalf of any such
         Senior Noteholder, shall promptly execute and deliver to the Senior
         Agent or the Borrower such termination statements, releases and other
         documents as the Senior Agent or the Borrower may request to
         effectively confirm such release.

                                       6
<PAGE>

                  (b)      Provided that the Borrower has certified that there
         is no "Event of Default" under the Indenture and the Trustee has not
         received a notice that an "Event of Default" under the Indenture has
         occurred and is continuing, all of the Second Priority Liens will be
         released if, and for so long as, (i) the First Priority Liens have been
         released and (ii) the First Lien Indebtedness remains unsecured and the
         commitment under the revolving credit facility thereunder (A) continues
         in a minimum amount of $50,000,000 (unless such commitment is
         terminated following an "Event of Default" under such First Lien
         Indebtedness) and (B) had an initial term of no less than 364 days.

                  (c)      In the event the Senior Agent or the Senior Lenders
         enter into any amendment, waiver or consent in respect of any of the
         Senior Collateral Documents for the purpose of adding to, or deleting
         from, or waiving or consenting to any departures from any provisions
         of, any Senior Collateral Document or changing in any manner the rights
         of the Senior Agent, the Senior Lenders, the Borrower or the Guarantors
         thereunder, then such amendment, waiver or consent shall apply
         automatically to any comparable provision of the comparable Second Lien
         Collateral Document without the consent of the Trustee or the Senior
         Noteholders and without any action by the Trustee, the Borrower or any
         Guarantor; provided, however, (i) that no such amendment, waiver or
         consent shall apply automatically to the Second Lien Collateral
         Documents if it (A) shall have the effect of removing assets subject to
         the lien of the Second Lien Collateral Documents, except to the extent
         that a release of such lien is permitted by Section 2.2(a), (B)
         modifies any material remedy provided for under the Second Lien
         Collateral Documents, (C) secures indebtedness or obligations owed in
         favor of any other creditor or group of creditors except as
         contemplated by Section 2.4, or (D) changes the priority of or further
         makes junior the liens created under the Second Lien Collateral
         Documents, except as contemplated by this Agreement, including Section
         2.4 hereof, and the Indenture, and (ii) notice of such amendment,
         waiver or consent shall promptly be given to the Trustee.

                  (d)      The Trustee, for itself and on behalf of the
         Noteholders, hereby irrevocably constitutes and appoints the Senior
         Agent and any officer or agent of the Senior Agent, with full power of
         substitution, as its true and lawful attorney-in-fact with full
         irrevocable power and authority in the place and stead of the Trustee
         or such holder or in the Senior Agent's own name, from time to time in
         the Senior Agent's discretion, for the purpose of carrying out the
         terms of this Section 2.2, to take any and all appropriate action and
         to execute and record any and all documents and instruments which may
         be necessary or desirable to accomplish the purposes of this Section
         2.2, including, without limitation, any financing statements,
         endorsements or other instruments or transfer or release. For purposes
         of exercising the power of attorney granted pursuant to this Section
         2.2(d), the Trustee, on behalf of itself and the Senior Noteholders,
         hereby agrees that the Senior Agent shall be entitled to conclusively
         rely (without independent verification and so long as such reliance
         does not constitute gross negligence or willful misconduct) on the
         officer's certificate required by Section 4.06 of the Indenture
         (Limitation on Asset Dispositions) stating that a sale, lease,
         exchange, transfer or other disposition of Collateral is permitted or
         not prohibited under Section 4.06 of the Indenture (Limitation on Asset
         Dispositions) as evidence that such sale, lease, exchange,

                                       7
<PAGE>

         transfer or other disposition of Collateral is permitted or not
         prohibited under the Indenture.

                  (e)      Notwithstanding anything to the contrary contained
         herein, in the event that the Senior Agent releases its liens on the
         Collateral because the First Lien Indebtedness has been Paid in Full,
         neither the Trustee nor the Senior Noteholders shall be obligated to
         release their liens on any Collateral owned by the Credit Parties after
         giving effect to such payment and termination (and any sale, transfer
         or other disposition of Collateral occurring in connection therewith);
         provided, however, that in connection with any refinancing or
         replacement of all or any portion of the First Lien Indebtedness prior
         to the occurrence of a Bankruptcy Event, the Trustee, on behalf of each
         Senior Noteholder, shall, if requested by the Borrower or the existing
         or new holders of the First Lien Indebtedness, execute an intercreditor
         agreement substantively similar to this Agreement with the lenders
         under such refinancing or replacement. Furthermore, if the First Lien
         Indebtedness has been Paid in Full in connection with any sale,
         transfer or other disposition of Collateral, the Second Priority Liens
         shall not be automatically released with respect to the proceeds of
         such sale, transfer or other disposition of Collateral which remain
         after the First Lien Indebtedness has been Paid in Full.

                  (f)      Notwithstanding any provision to the contrary
         contained in this Article II, no portion of the Collateral may be
         released from the Second Lien Collateral Documents unless the Borrower
         shall have complied with the provisions of Sections 314(c) and 314(d)
         of the Trust Indenture Act, if applicable, and shall have furnished
         evidence of such compliance (or evidence that no compliance is needed)
         to the Senior Agent and the Trustee.

         Section 2.3 Exercise of Remedies.

                  (a)      So long as the First Lien Indebtedness has not been
         Paid in Full, whether or not a Bankruptcy Event has been commenced by
         or against any Credit Party, and subject to Section 2.4, (i) the
         Trustee and the Senior Noteholders will not (u) exercise or seek to
         exercise any rights or remedies (including setoff) with respect to any
         Collateral, (v) institute any action or proceeding with respect to such
         rights or remedies, including, without limitation, any action of
         foreclosure, (w) contest, protest or object to (1) any foreclosure
         proceeding or action brought by the Senior Agent or any Senior Lender,
         (2) the exercise of any right under any lockbox agreement, control
         agreement, landlord waiver or bailee's letter or similar agreement or
         arrangement to which the Senior Agent or any Senior Lender is a party,
         or (3) any other exercise by any such party, of any rights and remedies
         relating to the Collateral under the Senior Collateral Documents or
         otherwise, (x) object to the forbearance by the Senior Lenders from
         bringing or pursuing any foreclosure proceeding or action or any other
         exercise of any rights or remedies relating to the Collateral, (y)
         except for liens and security interests subject to this Agreement,
         demand, accept or obtain any lien on any Collateral or (z) amend or
         modify the terms of the Second Lien Collateral Documents in a manner
         adverse to the interests of the Senior Agent or the Senior Lenders and
         (ii) the Senior Agent and the Senior Lenders shall have the exclusive
         right to enforce rights, exercise remedies (including, without
         limitation, setoff and the right to credit bid their debt) and make
         determinations regarding release, disposition, or restrictions with
         respect to the Collateral without any consultation

                                       8
<PAGE>

         with or the consent of the Trustee or any Senior Noteholder; provided,
         however, subject to Section 2.4, the Trustee may take any action not
         adverse to the liens on the Collateral securing the First Lien
         Indebtedness in order to preserve or protect its rights in the
         Collateral. In exercising rights and remedies with respect to the
         Collateral, the Senior Agent and the Senior Lenders may enforce the
         provisions of the Senior Collateral Documents and exercise remedies
         thereunder, all in such order and in such manner as they may determine
         in the exercise of their sole discretion. Such exercise and enforcement
         shall include, without limitation, the rights of an agent or other
         representative appointed by them to sell or otherwise dispose of
         Collateral upon foreclosure, to incur expenses in connection with such
         sale or disposition, and to exercise all the rights and remedies of a
         secured lender under the Uniform Commercial Code of any applicable
         jurisdiction and of a secured creditor under bankruptcy or similar laws
         of any applicable jurisdiction.

                  (b)      The Trustee, on behalf of itself and the Senior
         Noteholders, agrees that it will not take or receive any Collateral or
         any proceeds of Collateral in connection with the exercise of any right
         or remedy (including setoff) with respect to any Collateral, unless and
         until the First Lien Indebtedness has been Paid in Full. Without
         limiting the generality of the foregoing, unless and until the First
         Lien Indebtedness has been Paid in Full, except as expressly provided
         in the proviso in Section 2.3(a)(ii) above and the other terms and
         conditions of this Agreement, the sole right of the Trustee and the
         Senior Noteholders with respect to the Collateral is to hold a lien on
         the Collateral pursuant to the Noteholder Documents for the period and
         to the extent granted therein and to receive a share of the proceeds
         thereof, if any, after the First Lien Indebtedness has been Paid in
         Full.

                  (c)      Subject to the proviso in Section 2.3(a)(ii) above
         and the other terms and conditions of this Agreement, the Trustee, for
         itself or on behalf of the Senior Noteholders, agrees that the Trustee
         and the Senior Noteholders will not take any action that would hinder
         any exercise of remedies undertaken by the Senior Agent under the
         Senior Loan Documents, including any sale, lease, exchange, transfer or
         other disposition of the Collateral, whether by foreclosure or
         otherwise.

                  (d)      To the extent not inconsistent with the terms of this
         Agreement, the Trustee and the Senior Noteholders may exercise rights
         and remedies as an unsecured creditor against the Borrower and its
         Subsidiaries in accordance with the terms of the Noteholder Documents
         and applicable law. Nothing in this Agreement shall prohibit the
         receipt by the Trustee or any Senior Noteholder of the required
         payments of interest and principal so long as such receipt is not the
         direct or indirect result of the exercise by the Trustee or any Senior
         Noteholder of rights or remedies as a secured creditor or enforcement
         of any lien held by any of them in contravention of this Agreement. In
         the event the Trustee or any Senior Noteholder becomes a judgment lien
         creditor in respect of Collateral as a result of its enforcement of its
         rights as an unsecured creditor, such judgment lien shall be junior to
         the liens securing the First Lien Indebtedness on the same basis as the
         other liens securing the Second Lien Indebtedness are so junior to the
         First Lien Indebtedness under this Agreement. Nothing in this Agreement
         modifies any rights

                                       9
<PAGE>

         or remedies the Senior Agent or the Senior Lenders may have with
         respect to the Collateral.

                  Section 2.4 Intercreditor Arrangements in Bankruptcy.

                  (a)      If any Credit Party shall be subject to any
         Bankruptcy Event, this Agreement shall nevertheless remain in full
         force and effect and enforceable pursuant to its terms, and all
         references herein to any Credit Party shall be deemed to apply to such
         entity as a debtor-in-possession and to any trustee in bankruptcy for
         the estate of such entity.

                  (b)      If in the context of a Bankruptcy Event for any
         Credit Party, the Senior Agent or the Required Senior Lenders, as
         holders of a lien in the Collateral, shall consent to the use of cash
         collateral pursuant to Section 363 of the Bankruptcy Code or other
         applicable law, then the Trustee, on behalf of itself and the Senior
         Noteholders, shall not raise any motion against or objection to such
         use and shall not request adequate protection or any other relief in
         connection therewith (except to the extent permitted by Section
         2.4(f)). If such cash collateral is used for the Payment in Full of the
         First Lien Indebtedness, nothing in this Agreement shall prohibit the
         Trustee, on behalf of itself and the Senior Noteholders, from seeking
         adequate protection other than as set forth in this Section 2.4(b) in
         connection with the use of cash collateral.

                  (c)      If in the context of a Bankruptcy Event for any
         Credit Party, the Senior Agent or the Required Senior Lenders, as
         holders of a lien in the Collateral, shall consent to the Credit
         Parties' incurrence of post-petition financing pursuant to Section 364
         of the Bankruptcy Code or other applicable law ("DIP Financing"), then
         the Trustee, on behalf of itself and the Senior Noteholders, shall not
         raise any motion against or objection to such use and shall not request
         adequate protection or any other relief in connection therewith (except
         to the extent permitted by Section 2.4(f)) and, to the extent the liens
         securing the First Lien Indebtedness are primed by or pari passu with
         the liens securing such DIP Financing, shall consent to the priming of
         its liens in the Collateral by such DIP Financing (and all obligations
         relating thereto). The Trustee on behalf of itself and each Senior
         Noteholder agrees that the Senior Agent and the Senior Lenders (or any
         subgroup thereof) may provide the DIP Financing contemplated by this
         Section 2.4(c).

                  (d)      If in the context of a Bankruptcy Event for any
         Credit Party, the Senior Agent or the Required Senior Lenders, as
         holders of a lien in the Collateral, shall consent to the sale or
         disposition of any assets constituting Collateral free and clear of
         security interests, liens or other claims on such Collateral (including
         any liens of the Senior Agent, the Senior Lenders, the Trustee and the
         Senior Noteholders) pursuant to Section 363 of the Bankruptcy Code or
         other applicable law, the Trustee, for itself or for the benefit of the
         Senior Noteholders, shall not raise any motion against or objection to
         such sale and the Trustee, for itself or on behalf of any such Senior
         Noteholder, promptly shall execute and deliver to the Senior Agent or
         the applicable Credit Party such termination statements, releases and
         other documents as the Credit Party may request to effectively confirm
         such release; provided that the respective interests of the Senior
         Agent and the Senior Lenders, on the one hand, and the Senior
         Noteholders, on the other hand, attach to the proceeds of such
         disposition, or alternatively such proceeds are paid first, to the

                                       10
<PAGE>

         Senior Agent for the benefit of the Senior Lenders to reduce the First
         Lien Indebtedness, and then, to the extent of any surplus, to the
         Trustee, for itself or on behalf of any such Senior Noteholder, for
         application to the Second Lien Indebtedness.

                  (e)      Until the First Lien Indebtedness has been Paid in
         Full, the Trustee, on behalf of itself and the Senior Noteholders,
         agrees that, unless otherwise permitted by this Agreement, none of them
         shall make any motion, claim, objection or argument in respect of the
         Collateral or seek relief from the automatic stay or any other stay in
         any Bankruptcy Event in respect of the Collateral, without the prior
         written consent of the Senior Agent, unless the Senior Agent has taken
         such action and the actions of the Trustee are otherwise consistent
         with this Agreement and the actions of the Senior Agent.

                  (f)      The Trustee, on behalf of itself and the Senior
         Noteholders, agrees that none of them shall contest (or support any
         other Person contesting) (i) any request by the Senior Agent or the
         Senior Lenders for adequate protection or (ii) any objection by the
         Senior Agent or the Senior Lenders to any motion, relief, action or
         proceeding based on the Senior Agent or the Senior Lenders claiming a
         lack of adequate protection. Notwithstanding the foregoing terms of
         this Section 2.4(f), in any Bankruptcy Event, (i) if the Senior Agent
         or the Senior Lenders (or any subset thereof) are granted adequate
         protection in the form of additional collateral (the "Additional
         Collateral") or administrative priority claims in connection with any
         DIP Financing or the use of its cash collateral under section 363 or
         section 364 of the Bankruptcy Code or other applicable law, then the
         Trustee, on behalf of itself or any of the Senior Noteholders, may seek
         or request adequate protection in the form of a replacement lien on,
         and administrative priority claims in connection with, the Additional
         Collateral, which lien and administrative priority claims are junior in
         priority to the liens and administrative priority claims securing the
         First Lien Indebtedness and, to the extent applicable, such DIP
         Financing (and all obligations relating thereto) to the same extent as
         the other liens and administrative priority claims securing the Second
         Lien Indebtedness are so junior in priority to the liens and
         administrative priority claims securing the First Lien Indebtedness
         under this Agreement. Any replacement liens and administrative priority
         claims obtained by the Senior Agent, the Senior Lenders, the Trustee or
         the Senior Noteholders in the context of a Bankruptcy Event shall be
         subject to the terms of this Agreement. If any DIP Financing is used
         for the Payment in Full of the First Lien Indebtedness (whether
         provided pursuant to the last sentence of Section 2.4(c) or otherwise),
         nothing in this Agreement shall prohibit the Trustee, on behalf of
         itself and the Senior Noteholders, from seeking adequate protection
         other than as set forth in this Section 2.4(f) in connection with such
         DIP Financing.

                  (g)      Nothing contained herein shall prohibit or in any way
         limit the Senior Agent or any Senior Lender from objecting in any
         Bankruptcy Event or otherwise to any action taken by the Trustee or any
         of the Senior Noteholders, to the extent such action is inconsistent
         with the terms of this Agreement, including, without limitation, the
         seeking by the Trustee or any Senior Noteholder of adequate protection
         or the asserting by the Trustee or any Senior Noteholder of any of its
         rights and remedies under the Noteholder Documents or otherwise.

                                       11
<PAGE>

                  (h)      The Trustee on behalf of itself and each Senior
         Noteholder agrees that neither the Trustee nor any Senior Noteholder
         will initiate, prosecute, encourage, or assist with any other person to
         initiate or prosecute any claim, action or other proceeding (i)
         challenging the validity or enforceability of this Agreement, (ii)
         challenging the validity, enforceability or unavoidability of any claim
         in respect of the First Lien Indebtedness, (iii) challenging the
         perfection, enforceability or unavoidability of any First Priority
         Liens or (iv) asserting any claims which the Credit Parties may hold
         with respect to the Senior Agent or the Senior Lenders or the First
         Lien Indebtedness, if any. The Senior Agent, for itself and on behalf
         of the Senior Lenders, agrees that it will not initiate, prosecute,
         encourage, or assist with any other person to initiate or prosecute any
         claim, action or other proceeding (i) challenging the validity or
         enforceability of this Agreement, (ii) challenging the validity,
         enforceability or unavoidability of any claim in respect of the Second
         Lien Indebtedness, (iii) challenging the perfection, enforceability or
         unavoidability of any Second Priority Liens or (iv) asserting any
         claims which the Credit Parties may hold with respect to the Senior
         Noteholders or the Second Lien Indebtedness, if any. For the avoidance
         of doubt, the terms of this paragraph shall apply whether or not a
         Bankruptcy Event has occurred and such terms shall survive the
         termination of this Agreement.

                  (i)      The Trustee and each Senior Noteholder shall be
         entitled (A) to file proofs of claim and all necessary responsive or
         defensive pleadings in opposition to any motion, claim, adversary
         proceeding or other pleading made by any person objecting to or
         otherwise seeking the disallowance of the claims of the Trustee or any
         Senior Noteholder, including, without limitation, any claims secured by
         the Collateral; (B) to vote on any plan of reorganization and appear
         and be heard on any matter in connection therewith to the extent not
         inconsistent with this Agreement; and (C) to file all pleadings,
         objections, motions or agreements which assert rights or interests
         available to unsecured creditors of the Credit Parties arising under
         either the Bankruptcy Code or applicable non-bankruptcy law (other than
         any pleadings, objections, motions or agreements inconsistent with its
         obligations under Section 2.4(a)-(h)), including, without limitation,
         motions and other pleadings to terminate the exclusive periods under 11
         U.S.C. Section 1121, motions and other pleadings for the appointment of
         an examiner or a trustee, and motions and other pleadings to confirm or
         deny confirmation of any plan of reorganization. The reference to
         pleadings, objections, motions or agreement which assert rights or
         interests available to unsecured creditors is intended to describe
         actions which may be taken by the Senior Noteholders and does not imply
         that any part of the Second Lien Indebtedness is unsecured, nor will
         the taking of any such actions by any Senior Noteholder create any
         implication or inference that any part of the Second Lien Indebtedness
         is unsecured.

         Section 2.5 Obligations of the Credit Parties Unconditional.

                  (a)      Nothing contained in this Agreement is intended to or
         shall relieve the obligations of the Credit Parties to the Senior
         Agent, the Senior Lenders, the Trustee or the Senior Noteholders to pay
         any amount in respect of the First Lien Indebtedness or the Second Lien
         Indebtedness, as the case may be, as and when such amount shall become
         due and payable in accordance with the terms thereof, or to affect the
         relative rights of the Senior Agent, the Senior Lenders, the Trustee or
         the Senior Noteholders, on the one

                                       12
<PAGE>

         hand, and the other creditors of the Credit Parties, on the other hand.
         All rights, interests, and obligations of the Senior Agent, the Senior
         Lenders, the Trustee, the Senior Noteholders, and the Credit Parties
         hereunder, shall remain in full force and effect irrespective of:

                           (i)      any lack of validity or enforceability of
                  any loan document or any other agreement or instrument
                  relating thereto;

                           (ii)     any change in the time, manner or place of,
                  or in any other term of, all or any of the First Lien
                  Indebtedness or the Second Lien Indebtedness, or any amendment
                  or waiver of or any consent to departure from any provision of
                  the Senior Credit Agreement, the Indenture, or any loan or
                  collateral document relating to either of the foregoing;

                           (iii)    any exchange, release, non-perfection,
                  invalidity, unenforceability or avoidability of any lien or
                  security interest in any Collateral, or any release or
                  amendment or waiver of or consent to departure from any
                  guarantee, for all or any of the First Lien Indebtedness or
                  the Second Lien Indebtedness; or

                           (iv)     any other circumstances which might
                  otherwise constitute a defense available to, or a discharge
                  of, the Credit Parties in respect of the First Lien
                  Indebtedness, or of the Second Lien Indebtedness, in respect
                  of this Agreement.

                  (b)      Nothing contained in this Agreement shall affect or
         excuse the obligation of the Credit Parties to make, or prevent the
         Credit Parties from making, at any time, payment of any amount in
         respect of the First Lien Indebtedness and the Second Lien
         Indebtedness.

         Section 2.6 No Other Beneficiaries. This Agreement and the priority
provisions contained herein are intended only for the benefit of the holders of
First Lien Indebtedness and no other creditor of the Credit Parties. The Credit
Parties will not publish or give to any creditor or prospective creditor of the
Credit Parties any copy, statement or summary (or acquiesce in the publication
or giving of any such copy, statement or summary) as to the second priority of
the lien rights of the Trustee and the Senior Noteholders without also stating
or causing to be stated (in a reasonably apparent manner in the case of any
document) that the second priority status of such lien rights is solely for the
benefit of the holders of First Lien Indebtedness and not for the benefit of any
other creditor of the Credit Parties or the Credit Parties.

         Section 2.7 Rights of Holders of First Lien Indebtedness Not to be
Impaired. No right of any present or future holder of any First Lien
Indebtedness to enforce the priority of the First Priority Liens as herein
provided shall at any time in any way be prejudiced or impaired by any act or
omission in good faith by any such holder, or by any noncompliance by the Credit
Parties with the terms and provisions and covenants herein or in any documents
or instruments supporting or evidencing the Second Lien Indebtedness, regardless
of any knowledge thereof that any such holder of First Lien Indebtedness may
have or otherwise be charged with.

                                       13
<PAGE>

         Section 2.8 Waivers. The Senior Agent and the Senior Lenders shall not
have any liability or duty, of any kind, nature or origin, to the Trustee or any
Senior Noteholder, express or implied, except as set forth in this Agreement.
The Trustee, on behalf of itself and each Senior Noteholder, hereby waives and
releases any claim which it may now or hereafter have against the Senior Agent
and/or any Senior Lender arising out of any and all actions which the Senior
Agent and/or any Senior Lender, in good faith, takes or omits to take, including
without limitation, (a) actions with respect to the creation, perfection or
continuation of liens or security interests in the Collateral and other security
for the First Lien Indebtedness, (b) actions (other than gross negligence or
willful misconduct) with respect to the occurrence of any event of default under
this Agreement, the Senior Credit Agreement, or any other loan or collateral
documents relating to the First Lien Indebtedness, (c) actions with respect to
the foreclosure upon, sale, release, or depreciation of, or failure to realize
upon, any of the Collateral, (d) actions with respect to the collection of any
claim for all or any part of the First Lien Indebtedness from any account
debtor, guarantor or any other party, (e) any other action with respect to the
enforcement of any loan documents relating to the First Lien Indebtedness or the
valuation, use, protection or disposition of the Collateral or any other
security for the First Lien Indebtedness, and (f) the election of the Senior
Agent or any Senior Lender, in any proceeding instituted under Chapter 11 of the
Bankruptcy Code, for application of Section 1111(b) of the Bankruptcy Code.

         Section 2.9 Remedies.

                  (a)      Rights Cumulative. The rights and remedies of the
         Senior Agent and the Senior Lenders under this Agreement, the Senior
         Credit Agreement or any other loan or collateral documents relating to
         the First Lien Indebtedness shall be cumulative and not exclusive of
         any rights or remedies which any of them would otherwise have. In
         exercising such rights and remedies, the Senior Agent and the Senior
         Lenders may be selective and no failure or delay by the Senior Agent or
         the Senior Lenders in exercising any right shall operate as a waiver of
         such right, nor shall any partial or single exercise of any power or
         right preclude its other or further exercise or the exercise of any
         other power or right. The rights and remedies of the Trustee and Senior
         Noteholders under this Agreement, the Indenture, the Second Lien
         Collateral Documents, or any other loan or collateral documents
         relating to the Second Lien Indebtedness shall be cumulative and not
         exclusive of any rights or remedies which any of them would otherwise
         have. In exercising such rights and remedies, subject to the terms of
         this Agreement, the Trustee and the Senior Noteholders may be selective
         and no failure or delay by the Trustee or the Senior Noteholders in
         exercising any right shall operate as a waiver of such right, nor shall
         any partial or single exercise of any power or right preclude its other
         or further exercise or the exercise of any other power or right.

                  (b)      Waiver of Marshalling. Each of the Credit Parties and
         the Trustee, on behalf of itself and the Senior Noteholders, hereby
         waives any right to require marshalling of assets by the Senior Agent
         or the Senior Lenders and any similar rights.

                                       14
<PAGE>

         Section 2.10 Consent to Recording of Second Priority Liens. The Senior
Agent and the Credit Parties each hereby consent to the recording of the Second
Priority Liens from time to time in the appropriate public registries.

         Section 2.11 Insurance. Unless and until the First Lien Indebtedness
has been Paid in Full, the Senior Agent and the Senior Lenders shall have the
sole and exclusive right, subject to the rights of the Borrower and the
Guarantors under the First Lien Collateral Documents, to adjust settlement for
any insurance policy covering the Collateral in the event of any loss thereunder
and to approve any award granted in any condemnation or similar proceeding
affecting the Collateral. Unless and until the First Lien Indebtedness has been
Paid in Full, all proceeds of any such policy and any such award in respect of
the Collateral shall be paid to the Senior Agent for the benefit of the Senior
Lenders to the extent required under the Senior Credit Agreement and thereafter
to the Trustee for the benefit of the Senior Noteholders to the extent required
under the applicable Noteholder Documents and then to the owner of the subject
property or as a court of competent jurisdiction may otherwise direct. If the
Trustee or any Senior Noteholder shall, at any time, receive any proceeds of any
such insurance policy or any such award in contravention of this Agreement, it
shall immediately pay such proceeds over to the Senior Agent in accordance with
the terms of Section 2.2.

         Section 2.12 Senior Agent As Bailee for Perfection of Interest in
Possessory Collateral. The Trustee, on behalf of the Senior Noteholders, hereby
appoints the Senior Agent as the agent for the Trustee and the Senior
Noteholders solely for purposes of perfecting the Trustee's and the Senior
Noteholders' liens on Collateral which is of a type such that perfection of a
lien thereon may be accomplished by possession thereof and to which the Senior
Agent has possession (and the Senior Agent hereby acknowledges such
appointment). In the event all First Lien Indebtedness shall have been Paid in
Full, the Senior Agent shall deliver to the Trustee all such Collateral
remaining in the possession of the Senior Agent, and the Credit Parties hereby
irrevocably authorize any such delivery of Collateral by the Senior Agent. The
obligations of the Senior Agent and the Credit Parties under the preceding
sentence shall survive the termination of this Agreement.

         Section 2.13 Certain Notices. Each of the Senior Agent and Trustee
hereby agrees to use its reasonable best efforts to give written notice to the
other of any declaration of acceleration (as permitted hereunder), event of
default declared in writing by it or, in the case of the Senior Agent,
commencement of any action enforcing its rights or remedies under the Senior
Credit Agreement; provided, however, that failure to give any such notice shall
not result in liability to the Senior Agent, any Senior Lender, the Trustee or
any Senior Noteholder, as the case may be, or modify in any way the terms and
provisions of this Agreement, or otherwise relieve any party of its respective
obligations under this Agreement. No party hereto shall have any obligation to
cure any such default and any payment made or act done by any such party to cure
any such default shall not constitute an assumption of or participation in the
Senior Credit Agreement or the Indenture or the documents executed and delivered
in connection therewith or of any of the respective obligations thereunder.

                                       15
<PAGE>

                                   ARTICLE III

                                  MISCELLANEOUS

         Section 3.1 Successors; Continuing Effect. This Agreement is being
entered into for the benefit of, and shall be binding upon, (i) the Senior Agent
and the Senior Lenders and each of their respective successors and assigns,
including subsequent holders of First Lien Indebtedness, and the term "holders
of First Lien Indebtedness" shall include any such subsequent or additional
holder of First Lien Indebtedness, wherever the context permits, and (ii) the
Trustee and the Senior Noteholders and each of their respective successors and
assigns, including subsequent holders of the Second Lien Indebtedness, and the
term "holders of Second Lien Indebtedness" shall include any such subsequent or
additional holder of Second Lien Indebtedness, wherever the context permits.

         Section 3.2 Further Assurances. (a) The Credit Parties and the Trustee
will, at the expense of the Credit Parties, and at any time and from time to
time, promptly execute and deliver all further instruments and documents, and
take all further action, that Senior Agent may reasonably request in order to
perfect or otherwise protect any right or interest granted or purported to be
granted hereby or to enable the Senior Agent to exercise and enforce its rights
and remedies hereunder, including, without limitation, appropriate amendments to
financing statements executed by the Credit Parties in favor of the Trustee in
order to refer to this Agreement (but this Agreement shall remain fully
effective notwithstanding any failure to execute any additional documents or
instruments). Without limiting the generality of the foregoing, in connection
with any refinancing or replacement of all or any portion of the First Lien
Indebtedness, the Trustee agrees, if requested by the holders of the First Lien
Indebtedness, to execute an intercreditor agreement substantively similar to
this Agreement with the lenders under such refinancing or replacement.

         (b)      Each party hereto will, upon the written request of the other
party, from time to time execute and deliver or cause to be executed and
delivered such further instruments and agreements and do or cause to be done
such further acts, including an accounting of the application of proceeds from
the Collateral, as may be reasonably necessary or proper to carry out more
effectively the provisions of this Agreement. Upon written request, the Senior
Agent shall provide the Trustee with copies of all Senior Collateral Documents
in effect at the time of such request; provided, however, that the Trustee
acknowledges the delivery of all or substantially all of the Senior Collateral
Documents in effect as of the date of this Agreement.

         Section 3.3 Expenses. The Credit Parties shall pay to the Senior Agent,
the Senior Lenders, the Senior Noteholders and the Trustee, as the case may be,
upon demand, the amount of any and all reasonable expenses, including, without
limitation, the reasonable fees and expenses of counsel for the Senior Agent,
the Senior Lenders, the Senior Noteholders and the Trustee, as the case may be,
which any of them may incur from time to time in connection with the exercise or
enforcement of any of their respective rights or interests vis-a-vis the Credit
Parties, the Collateral, or under this Agreement. All such amounts shall
constitute part of the First Lien Indebtedness or the Second Lien Indebtedness,
as the case may be.

                                       16
<PAGE>

         Section 3.4 Notices; Amendments etc.

                  (a)      All notices, requests and demands to or upon the
         parties to this Agreement to be effective shall be in writing
         (including by facsimile or telecopy transmission) and shall be deemed
         to have been duly given or made (i) when delivered by hand or (ii)
         three Business Days after being deposited in the mail, postage prepaid
         or (iii) one Business Day after being sent by priority overnight mail
         with an internationally recognized overnight delivery carrier or (iv)
         if by telecopy or facsimile, when received, at the addresses or
         transmission numbers for notices set forth on the signature pages to
         this Agreement or to such other address or transmission number as may
         be hereafter notified in writing by the respective parties hereto.

                  (b)      This Agreement may be amended and the terms hereof
         may be waived only with the written consent of each of the parties
         hereto, or their authorized successors and assigns.

         Section 3.5 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction, shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or invalidity without
invalidating the remaining portions hereof or thereof or affecting the validity
or enforceability of such provision in any other jurisdiction.

         SECTION 3.6 WAIVER OF JURY TRIAL. EACH OF THE CREDIT PARTIES, THE
SENIOR AGENT (FOR ITSELF AND ON BEHALF OF THE SENIOR LENDERS) AND THE TRUSTEE
(FOR ITSELF AND ON BEHALF OF THE SENIOR NOTEHOLDERS) HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING
TO THIS AGREEMENT AND FOR ANY COUNTERCLAIM THEREIN.

         Section 3.7 Entire Agreement; Governing Law. This Agreement embodies
the entire agreement and understanding of the parties hereto regarding the
subject matter hereof. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK.

         Section 3.8 Counterparts. This Agreement may be executed in any number
of counterparts, and each such counterpart shall be deemed to be an original
instrument, but all such counterparts together shall constitute one agreement.

         Section 3.9 Headings. The headings of the several sections in this
Agreement are inserted for convenience of reference only and are not intended to
be a part of or to affect the meaning or interpretation of this Agreement.

         Section 3.10 Termination. Upon the ninety-first (91st) day after all
First Lien Indebtedness has been Paid in Full, this Agreement shall immediately
terminate and cease to be effective and the Senior Agent, the Senior Lenders,
the Senior Noteholders, the Trustee, and the Credit Parties shall be released
from their respective obligations hereunder (other than such obligations that by
their terms are stated to survive the termination of this Agreement); provided,
however, (a) this Agreement shall be automatically reinstated if at any time
payment of, in whole

                                       17
<PAGE>

or in part, any of the First Lien Indebtedness is challenged by the initiation
of any suit or proceeding by any party, or is rescinded or must otherwise be
restored or returned by the Senior Agent or any Senior Lender as a preference,
fraudulent conveyance or otherwise under any bankruptcy, insolvency or similar
law, or under any other state or federal law, the common law or any ruling in
equity, all as though such payment had not been made, and in such event, all
reasonable documented costs and expenses including, without limitation, any
reasonable documented legal fees and disbursements) incurred by the Senior Agent
or any Senior Lender in defending any such action or proceeding or enforcing
such reinstatement shall be deemed included as part of the First Lien
Indebtedness and the Trustee and the Senior Noteholders shall account for any
payments received in respect of the Collateral prior to such reinstatement and
(b) immediately after all First Lien Indebtedness has been Paid in Full, the
terms of this Agreement shall no longer be applicable to restrict any action or
failure to act by the Trustee and the Senior Noteholders with respect to the
Collateral, subject to the immediately preceding clause (a) and the Senior Agent
shall execute and deliver such documents, filings and releases as may reasonably
requested by the Trustee to evidence the release of the First Priority Liens.

         Section 3.11. Compliance with Trust Indenture Act. Nothing contained
herein shall impair the ability of the Trustee to take any action necessary to
comply with any obligations imposed under applicable law, including without
limitation, the Trust Indenture Act.

               [Remainder of this page intentionally left blank.]

                                       18
<PAGE>

         IN WITNESS WHEREOF, the undersigned have caused this Agreement to be
duly executed and delivered by their duly authorized officers as of the date and
year first above written.

                                    BANK OF AMERICA, N.A.,
                                    as Senior Agent

                                    By:    /s/ Liliana Claar
                                    Name:  Liliana Claar
                                    Title: Vice President

                                    WELLS FARGO BANK MINNESOTA,NATIONAL
                                    ASSOCIATION, as Trustee

                                    By:    /s/ Jane Schweiger
                                    Name:  Jane Schweiger
                                    Title: Vice President

Acknowledged and Agreed:

                                    UNITED STATES CAN COMPANY,
                                    a Delaware corporation

                                    By:    /s/ Sandra K. Vollman
                                    Name:  Sandra K. Vollman
                                    Title: Sr. VP and CFO

                                    U.S. CAN CORPORATION,
                                    a Delaware corporation

                                    By:    /s/ Sandra K. Vollman
                                    Name:  Sandra K. Vollman
                                    Title: Sr. VP and CFO

                                    USC MAY VERPACKUNGEN HOLDING INC.,
                                    a Delaware corporation

                                    By:    /s/ Sandra K. Vollman
                                    Name:  Sandra K. Vollman
                                    Title: Sr. VP and CFO

LIEN INTERCREDITOR AGREEMENT
UNITED STATES CAN COMPANY

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