Document:

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                            TWIST 'N GO SUPPLY AGREEMENT

       THIS AGREEMENT, entered as of the 9th day of September, 1999, by and
between Pepsi-Cola Company, a division of PepsiCo, Inc., a corporation of
North Carolina, with offices at 700 Anderson Hill Road, Purchase, New York
("Pepsi") and Packaging Resources Incorporated ("PRI"), a corporation of
Delaware with offices at One Conway Park 100 Field Drive, Suite 300 Lake
Forest, Illinois 60045.

                                     WITNESSETH

       WHEREAS, Pepsi has developed a proprietary lidded fountain cup and is
the owner of the Product, Patents, Know-How and Trademarks as hereinafter
defined;

       WHEREAS, Pepsi desires the manufacture of the Product for purchase by
its authorized soft drink bottlers and fountain customers, and PRI is willing
to engage in such manufacture and sale.

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

                                     ARTICLE 1
                                    DEFINITIONS

1.1    "Product" shall mean a three-part, lidded plastic fountain cup meeting
       the specifications provided in SCHEDULES A, B and C hereto, as the same
       may be modified from time to time in Pepsi's sole discretion (also
       referred to as "Cups"), or covered by any valid claim of the Patents, as
       defined below.

1.2    "Patents" shall mean U.S. Patent Serial No. 09/038,689, filed on March 9,
       1998; Design Patent Serial No. 29/085,393, filed on March 23, 1998; and
       Design Patent Serial No. 29/091,992, filed on August 10, 1998, plus any
       and all Letters Patent issuing therefrom, including any and all
       divisionals, reissues, renewals, continuations and continuations-in-part
       thereof, as well as any and all foreign counterparts thereof.

1.3    "Know-How" shall mean any and all technical information, data, drawings,
       designs, processes, programs, formulas and related material, irrespective
       of form, pertaining to the design, testing and manufacture of the
       Product, whether now existing or hereafter developed in relation thereto.

1.4    "Trademarks" shall mean the trademarks listed in SCHEDULE D hereto, as
       the same may be modified from time to time in Pepsi's sole discretion,
       together with the various symbols, designs, devices, logos, labels, trade
       dress, slogans and other distinctive material used in connection
       therewith, including associated goodwill.

1.5    "Initial Production Date" shall mean the earlier of (a) the first date on
       which Cups are manufactured by PRI using the Molds or (b) August 6, 1999,
       in accordance with the commercialization timetable attached hereto as
       SCHEDULE E.

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1.6    "Full Production Date" shall mean the earlier of (a) the first date on
       which production volumes of the Product by PRI reach or exceed [*] cups
       per week, or (b) September 24, 1999, in accordance with the
       commercialization timetable attached hereto as SCHEDULE E.

1.7    "Contract Year" shall mean that period commencing upon the Initial
       Production Date (which, if not falling on the first day of the month,
       shall be adjusted upward or downward by no more than fourteen days to the
       first day of the nearer of the current or next-succeeding month, for ease
       of calculation) and ending twelve months from such date, or any
       subsequent twelve-month period commencing on the anniversary of the such
       date during the Term of the Agreement.

1.8    "Initial Production Period shall mean that period during the Term of the
       Agreement commencing on the Initial Production Date, as described above,
       and running through December 31, 1999.

1.9    "Book Value" shall mean original cost less depreciation from the date the
       equipment is placed in service through the time notice is received under
       Section 5.3.  The equipment shall be depreciated on a straight-line basis
       over thirteen (13) years in accordance with SCHEDULE F attached hereto.

                                     ARTICLE 2
                                    DEVELOPMENT

2.1    TOOLING.  PRI agrees to direct and manage, consistent with good
       industry practice and in cooperation with Pepsi, the design, development
       and manufacture of all molds and related tooling which are appropriate
       and sufficient for the production of the Product in the quantities
       specified herein ("Molds").  PRI represents that it is currently
       proceeding with the sourcing of the Molds as authorized by Pepsi on
       October 9, 1998.  The design of the Molds shall accommodate such design
       changes to the Product as Pepsi may specify from time to time, and Pepsi
       shall have the right to approve the final design of the Molds prior to
       their manufacture.

2.2    COST:  Pepsi shall pay the documented purchase price of the Molds in an
       amount not to exceed [*].

2.3    OWNERSHIP.  Title to the Molds shall vest in Pepsi upon payment of the
       documented purchase price described above, and PRI agrees to affix
       permanent labels to the Molds evidencing such ownership, as Pepsi may
       specify, and to execute such documents, including without limitation
       financing statements, and perform such other lawful acts as Pepsi may
       direct to protect its ownership interest in the Molds.  During the Term
       of this Agreement the Molds will remain with PRI at its manufacturing
       premises and may not be removed without Pepsi's prior written consent;
       provided, however, that Pepsi may direct the removal of the Molds at any
       time upon thirty (30) days' written notice, at Pepsi's expense, without
       prejudice to either party's rights under this Agreement.  PRI will, at
       its own expense, maintain the Molds in good working condition, excluding
       major rebuilds, and maintain replacement cost/all risks property
       insurance with respect to the Molds,

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       naming Pepsi as a loss payee, in the total amount of at least [*] and
       liability insurance in the amount of at least [*].  PRI will furnish to
       Pepsi certificates of insurance evidencing such coverage upon request.
       PRI agrees not to modify the Molds without Pepsi's prior written
       permission.  Schedule G outlines anticipated mold maintenance
       expenses.  All preventative and minor maintenance as outlined in this
       schedule are PRI's responsibility.  Pepsi is responsible for major
       rebuild expenses, not to exceed the expenses outlined in Schedule G.
       Upon Pepsi's request PRI will provide evidence that mold maintenance
       per Schedule G was completed by PRI. Pepsi must approve all rebuild
       expenses prior to the work commencing.

2.4    DEVELOPMENT PERIOD.  The parties will use best efforts to conclude the
       design, acquisition, installation and final testing of the Molds, and in
       the case of PRI, to achieve full production of [*] Cups per week
       (subject to customer demand), in accordance with the commercialization
       timetable attached hereto as SCHEDULE E.  PRI acknowledges the importance
       to Pepsi's business, of meeting this target date.

                                     ARTICLE 3
                                 PURCHASE AND SALE

3.1    Commencing on the Initial Production Date, PRI agrees to manufacture and
       sell to Pepsi or its designees, and Pepsi agrees to purchase, the Product
       on the terms and conditions set forth below.

3.2    PRICE. The delivered price of the Product shall be [*] per thousand Cups,
       including delivery in full truckload quantities to Pepsi or its designees
       anywhere in the United States.  Any incremental cost related to
       less-than-full truckload quantities shall be passed along to the
       purchaser.  The price of the Product shall be [*] per thousand Cups
       F.O.B. PRI's manufacturing plant(s).  The above pricing is based upon the
       plastic resin prices in Schedule C and includes a base packaging cost of
       [*] per thousand Cups.  In the event that Pepsi elects to change the
       packaging configuration, the above price will increase or decrease by the
       amount of the incremental difference in cost to PRI of such changes.
       Resin prices in this Schedule C reflect the net cost of resin to PRI
       (including all discounts, rebates, incentives, etc.) and upon request,
       PRI will provide to Pepsi copies of invoices validating same.  Any
       increases or decreases in the amount of plastic used to manufacture the
       Product - whether resulting from design changes, efficiencies or other
       cause - and/or changes in the market price of the polypropylene and other
       plastic resins required to manufacture the Product will be reflected in
       the Cup price in direct proportion to the weight of the plastic in the
       Product.  Pepsi and PRI agree to use best cooperative efforts to decrease
       the applicable plastic resin material costs and to negotiate stable
       plastic resin material prices annually, or for longer periods if
       possible.  Changes in PRI's resin costs will result in a concomitant
       change to the container prices 30 days after the price change is
       implemented by PRI's suppliers.

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3.3    MARKETING PREMIUM.  Notwithstanding the provisions of Section 3.2 above,
       Pepsi may from time to time, in its sole discretion, direct PRI to
       increase the price of Cups sold to any customer(s) hereunder by a
       specified amount ("Marketing Premium"), which may differ from one
       customer to another.  PRI agrees to collect such Marketing Premium on
       Pepsi's behalf from the relevant customer(s) as part of the purchase
       price of the Product, and to pay to Pepsi the aggregate amount of all
       such Marketing Premiums collected on a quarterly basis, within thirty
       (30) days of the close of the calendar quarter in which such Marketing
       Premiums were collected.  Payments to be sent to:

                            Ms. Jeany Mui
                            Marketing Manager
                            Fountain Beverage Division
                            Pepsi-Cola Company
                            700 Anderson Hill Road
                            Purchase, NY  10577

3.4    QUANTITY.  Subject to the terms hereof, PRI agrees to manufacture and
       sell up to [*] Cups to Pepsi or its designees in each Contract Year
       during the Term of the Agreement, and the minimum quantity to be
       purchased by Pepsi or its designees here-under shall be [*] Cups per
       Contract Year, or such lower quantity as provided under Section 4.2
       below.

3.5    GRAPHICS.  At Pepsi's or its designee's request, the Product shall be
       imprinted with customized graphics in up to eight (8) colors using line
       art.  Production runs for line art shall be a minimum of [*] Cups.  If
       process art is used an additional cost of [*], for each design, will
       be charged by PRI and the minimum production run is [*] Cups.  PRI
       agrees that all printing of the Trademarks for the Product shall conform
       to the standards specified by Pepsi, including the use of appropriate
       legends, markings or notices of trademark ownership or registration.

3.6    CUSTOMER ORDERS.  PRI shall assume full responsibility for the sale of
       Product to Pepsi's designees, including timely processing of orders,
       customer service, invoicing, order consolidation, quality control,
       returns and receivables management, in keeping with good industry
       practice.  PRI acknowledges that except as expressly provided in Article
       4 below, Pepsi is not responsible for, nor does it guarantee, any orders
       (including payment therefor) by its designees.

3.7    TIMELY SHIPMENT.  PRI agrees to ship the Product within seven (7) days
       of the promised shipment date.

3.8    GRANT OF LICENSE.  Pepsi hereby grants to PRI, and PRI accepts, a
       non-exclusive, royalty-free license under the Patents and the Know-How
       to manufacture and sell the Product in the United States and Canada as
       provided herein, and the further nonexclusive right to apply the
       Trademarks to the Product sold hereunder.  PRI agrees to provide
       samples of the Product upon request and to give Pepsi or its
       representatives reasonable access to PRI's manufacturing premises in
       order to permit the reasonable monitoring of Product quality and usage
       of the Trademarks consistent with Pepsi's high standards.

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3.9    COST SAVINGS. Following the Full Production Date and for the Term of this
       Agreement, PRI agrees to notify Pepsi of any and all manufacturing cost
       savings effected for the Product (excluding plastic raw material price
       fluctuations and use reduction), which will be shared equally between PRI
       and Pepsi.  For purposes of measuring changes in manufacturing efficiency
       hereunder, the parties agree to refer to the target cycle times for the
       Molds, which will be updated as of the Full Production Date, attached
       hereto as SCHEDULE H.

                                     ARTICLE 4
                VOLUME PROJECTIONS, PRODUCTION TARGETS AND INVENTORY

4.1    VOLUME PROJECTIONS.  For each full calendar year during the Term of the
       Agreement, Pepsi will provide to PRI at a minimum semi-annual purchase
       volume projections for the Product, at least 90 days in advance, for the
       periods consisting of January 1 through June 30, and July 1 through
       December 31, respectively.  The volume projection for the Initial
       Production Period shall be provided by Pepsi to PRI no later than ninety
       (90) days prior to the Initial Production Date.  Each volume projection
       provided by Pepsi hereunder will specify monthly purchase targets for the
       Product, and PRI will use such volume projections to determine staffing
       and capacity allocation for the Product for the corresponding half of the
       applicable calendar year or, as applicable, for the Initial Production
       Period.  For purposes of calculating the under-utilization fee in Section
       4.3 below, only those monthly purchase targets falling within the
       applicable Contract Year will be considered.

4.2    MINIMUM PURCHASE REQUIREMENT.  Notwithstanding anything to the
       contrary herein, Pepsi's minimum purchase requirement of [*] Cups per
       Contract Year, as provided in Section 3.4 above, shall be subject to
       adjustment as follows:

       (a)    Pepsi may purchase Cups for its own account to maintain actual
              sales of the Product at or above [*] Cups in any Contract Year,
              or such other minimum purchase requirement quantity as may then
              be applicable;

       (b)    To the extent that PRI's actual production of the Product falls
              below any monthly purchase target(s) specified by Pepsi in its
              volume projection(s) provided under Section 4.1 above, up to a
              maximum of [*] Cups per week, Pepsi's minimum purchase
              requirement from the date of such shortfall shall be reduced by a
              quantity of Product equal to the total shortfall in production,
              which shall be cumulative for repeated occurrences;

       (c)    To the extent that Pepsi or its designees are required to cancel,
              in whole or in part, any order(s) for the Product because of
              breach of this Agreement by PRI, Pepsi's minimum purchase
              requirement from the date of such cancellation shall be reduced by
              a quantity of Product equal to the total quantity of Product
              canceled, which shall be cumulative for repeated occurrences; and

       (d)    In the event of a reduction in PRI's manufacturing capacity for
              the Product under Section 5.3 below, Pepsi's minimum purchase
              requirement from the date of such

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              reduction shall be reduced to [*] of the remaining installed
              manufacturing capacity for the Product, subject to any other
              adjustments provided herein.

4.3    UNDER-UTILIZATION FEE.  Subject to the terms hereof, in the event
       that PRI's sales of the Product in any Contract Year fall below the
       amount of Pepsi's minimum purchase requirement under Section 4.2 above
       for that Contract Year, for reasons not resulting from a breach of this
       Agreement by PRI, the following shall apply:

       (a)    If actual sales of the Product for such Contract Year equal or
              exceed the volume projections provided by Pepsi under Section 4.1
              above, which are applicable to that Contract Year, Pepsi shall pay
              to PRI an under-utilization fee of [*] per thousand Cups, for any
              shortfall in volume of actual sales below Pepsi's minimum purchase
              requirement for such Contract Year.

       (b)    If actual sales of the Product for such Contract Year are less
              than the aggregate volume projections provided by Pepsi under
              Section 4.1 above, which are applicable to that Contract Year,
              Pepsi shall pay to PRI an under-utilization fee of the combined
              total of:

              (i)   [*] per thousand Cups, for any shortfall of Pepsi's
                    aggregate volume projections applicable to that Contract
                    Year below Pepsi's minimum purchase requirement for such
                    Contract Year; and

              (ii)  [*] per thousand Cups, for the shortfall in the volume of
                    actual sales below Pepsi's volume projections applicable to
                    that Contract Year.

       (c)    The under-utilization fee as described herein shall be due and
              payable by Pepsi to PRI within thirty (30) days of Pepsi's receipt
              of PRI's invoice.

4.4    PRODUCTION TARGETS.  PRI agrees to use best efforts to comply with the
       production targets for the Product specified in the production timetable
       attached hereto as SCHEDULE I, subject to customer demand.

4.5    INVENTORY.  For the first Contract Year under this Agreement, PRI
       agrees to carry an inventory of up to [*] Cups, as Pepsi may
       direct, to support the initial market launch of the Product.  In each
       subsequent Contract Year, PRI shall carry an inventory of up to [*]
       Cups as required to fill existing orders, as Pepsi may direct.
       Such inventory requirements will be subject to the rated installed
       production capacity of the Molds and related equipment used to
       manufacture the Product, and the length of the notice of market launch or
       subsequent requirements of the Product provided by Pepsi.

4.6    INCREMENTAL VOLUME.  In the event that Pepsi or its designees desire to
       purchase more than [*] Cups in any calendar year during the Term of the
       Agreement, PRI shall have the right of first refusal, subject to the
       terms hereof, to provide such incremental volumes on terms at least as
       advantageous to Pepsi or its designees as those provided herein,
       provided that such terms are competitive with respect to price, quality
       and service; and provided further that in no case may the price charged
       by PRI for such

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       incremental volumes exceed the prices quoted to Pepsi in PRI's memo of
       October 2, 1998, attached as SCHEDULE J and incorporated herein by
       reference.  Notwithstanding the foregoing, Pepsi may in its sole
       discretion elect to source a portion of the overall volume of the
       Product from an alternate supplier if Pepsi determines that such a
       change is necessary for competitive reasons.

                                     ARTICLE 5
                                TERM AND TERMINATION

5.1    TERM.  The Term of this Agreement shall commence as of the date first
       written above and shall expire, unless terminated earlier as provided
       below, on the earlier of:

       (a)    December 31, 2004; or

       (b)    Upon, the sale and delivery of a total of [*] Cups by PRI to
              Pepsi or its designees, or such lower quantity as provided under
              the terms of Section 4.2 above.

5.2    TERMINATION.  Pepsi shall have the right to terminate this Agreement
       without prejudice to any other rights it may have if:

       (a)    PRI defaults in the performance of any of its material
              obligations, representations or warranties provided in this
              Agreement, and such default is not substantially cured within
              thirty (30) days of PRI's receipt of Pepsi's written notice of
              such default;

       (b)    PRI is unable to pay its debts when due, or makes any assignment
              for the benefit of creditors, or files any petition under
              bankruptcy or insolvency laws of any jurisdiction, or has a
              receiver or trustee appointed for its business, or is adjudicated
              bankrupt or insolvent; or

       (c)    PRI, or any portion of its capital stock, is acquired by a
              competitor of Pepsi in the beverage industry; or

       (d)    As provided in Section 5.3 (b) below.

5.3    ADVERSE BUSINESS CONDITIONS.  Notwithstanding anything to the
       contrary herein, if business conditions indicate that Pepsi will not be
       able to achieve the minimum volume targets provided in this Agreement,
       upon notice to PRI Pepsi may, in its sole discretion:

       (a)    Direct PRI to reduce manufacturing capacity for the Product by
              a specified percentage within ninety (90) days, which PRI
              agrees to do, in which case PRI will use best efforts to
              re-deploy the manufacturing equipment for the Product taken
              off-line to other uses to the extent possible.  If PRI is able
              to effect such re-deployment within ninety (90) days of
              receiving the above notice from Pepsi, Pepsi shall have no
              liability to PRI for the reduction in manufacturing capacity.
              To the extent, if any, that PRI is unable to effect such
              re-deployment of the manufacturing equipment taken off-line at
              Pepsi's direction, PRI will use best

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              efforts to sell such manufacturing equipment on reasonable
              commercial terms. In the event of such a sale, Pepsi agrees to
              pay to PRI the amount, if any, by which the proceeds of the
              sale fall below the book value of the manufacturing equipment
              at the time Pepsi's notice of a reduction in manufacturing
              capacity was received.  If, despite best efforts, PRI is not
              able to sell the equipment taken off-line at Pepsi's direction
              by one hundred eighty (180) days from its receipt of Pepsi's
              original notice of a reduction in capacity, Pepsi will pay to
              PRI the book value of such equipment as of the date such notice
              was received by PRI, whereupon Pepsi shall take title to such
              equipment and shall have the right to take immediate possession.

       (b)    Terminate this Agreement, in which case the following shall apply:

              (i)    PRI will use best efforts to re-deploy all manufacturing
                     equipment for the Product within ninety (90) days of
                     receipt of Pepsi's notice of termination.  To the
                     extent, if any, that PRI is unable to effect such
                     re-deployment, PRI will use best efforts to sell such
                     manufacturing equipment on reasonable commercial terms.
                     In the event of such a sale, Pepsi agrees to pay to PRI
                     the amount, if any, by which the proceeds of the sale
                     fall below the book value of the manufacturing equipment
                     sold.  Pepsi shall be entitled to receive a credit or
                     payment, at its sole election, from PRI for the amount,
                     if any, by which the proceeds of such sale exceed the
                     book value of the manufacturing equipment sold. If,
                     despite best efforts, PRI is not able to sell the
                     manufacturing equipment for the Product by one-hundred
                     eighty (180) days from its receipt of Pepsi's notice of
                     termination, Pepsi will pay to PRI the book value of
                     such equipment as of the date such notice was received
                     by PRI, whereupon Pepsi shall take title to such
                     equipment and shall have the right to take immediate
                     possession.

              (ii)   Notwithstanding anything to the contrary herein, Pepsi
                     shall have a right of first refusal, exercisable within
                     ninety (90) days of PRI's receipt of Pepsi's notice of
                     termination, to purchase any or all manufacturing
                     equipment for the Product at its book value as of the
                     date such notice was received by PRI.  Pepsi's exercise
                     of this right shall relieve the parties of their
                     obligations under Section 5.3(b)(i) above.

5.4    RIGHTS AND OBLIGATIONS.  Upon termination of this Agreement:

       (a)    PRI shall promptly cease all further use of the Patents, Know-How
              and Trademarks, and all rights granted to PRI in such property
              shall revert to Pepsi;

       (b)    Pepsi agrees to pay to PRI the full amount, if any, of under-
              utilization fees then due under Section 4.2, with payment to be
              made within sixty (60) days of such termination.

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                                     ARTICLE 6
                               INTELLECTUAL PROPERTY

6.1    OWNERSHIP.  PRI agrees to use the Patents, the Know-How and the
       Trademarks only in connection with the Product and agrees that all of
       PRI's use of such property under this Agreement inures to the benefit of
       Pepsi.  The parties acknowledge that Pepsi is the sole owner of all
       rights in and to the Product, the Patents, the Know-How and the
       Trademarks, including the goodwill associated therewith, and PRI agrees
       not to contest Pepsi's ownership or the validity of the Patents, the
       Know-How or the Trademarks during or after the Term of this Agreement.
       Apart from the rights of PRI granted under Section 3.8 above, PRI shall
       acquire no right, title or interest of any kind in or to the Patents, the
       Know-How or the Trademarks.

6.2    ASSIGNMENT.  PRI agrees to promptly identify, and to assign solely to
       Pepsi during the Term of this Agreement the ownership rights to, any and
       all inventions, improvements, enhancements, processes, artwork, designs
       and other intellectual property which it creates, develops, has developed
       or created for it, acquires or otherwise obtains in relation to the
       Product in the course of performing this Agreement, and further agrees to
       execute any and all appropriate documents to perfect such assignment. All
       such assigned intellectual property shall be included within the defined
       terms Patents, Know-How and Trademarks hereunder, as appropriate, and
       shall be subject to the terms of this Agreement.

6.3    QUALITY STANDARDS.  PRI shall insure at all times that the Product meets
       the standards of quality provided in SCHEDULES A, B AND C hereto, as
       amended from time to time by agreement of the parties.  In the event that
       the use of production molds by PRI results in Products that do not meet
       the specifications contained in Schedule B hereto, then PRI and Pepsi
       will use best efforts to achieve compliance with such specifications
       and/or jointly agree to amend such specifications.

6.4    CONFIDENTIALITY.

       (a)    All confidential information ("Information") provided by either
              party to the other in the performance of this Agreement or
              pursuant to the Memorandum of Understanding, between the parties,
              dated October 6, 1998, shall be held in strict confidence by the
              receiving party for the sole and exclusive benefit of the
              disclosing party, and shall not be disclosed or used for any
              purpose other than for the performance of this Agreement without
              the prior written consent of the disclosing party.

       (b)    As used herein, Information shall not include any information
              which: is already in the possession of the receiving party at the
              time of disclosure; is or becomes known to the public generally
              through no fault or other action of the receiving party; or is
              obtained lawfully from a third party who is not known to have
              obtained such information directly or indirectly pursuant to an
              obligation to keep such information confidential.

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       (c)    Each receiving party agrees to restrict distribution of
              Information to its employees solely on a need-to-know basis, to
              make no more than one copy of any Information, and to return all
              written or tangible Information, including all copies and extracts
              thereof, upon the request of the disclosing party.

       (d)    The parties acknowledge that no remedy at law for damages is
              adequate to compensate for a breach of the provisions set forth in
              this Section 6.4 and that the party injured by such breach shall
              be entitled to temporary or permanent injunctive relief against
              any such breach, without the necessity of proving actual damages.
              The award of permanent or temporary injunctive relief shall in no
              way limit any other remedies to which the injured party may be
              entitled as a result of any such breach.

       (e)    The provisions of this Section 6.4 shall, as of the date hereof,
              supersede the provisions of the previous confidentiality agreement
              between the parties, dated October 8, 1997.

       6.5    PROTECTION AND DEFENSE.  Pepsi agrees to protect and defend the
Patents and Trademarks at its sole expense.  PRI shall cooperate fully with
Pepsi in the protection and defense of the Patents and Trademarks and shall
promptly advise Pepsi of any potentially infringing uses by others, as well as
any claims or suits raised against PRI involving the Patents or Trademarks.  All
decisions involving the protection or defense of the Patents or Trademarks shall
be solely in the discretion of Pepsi.  PRI shall take no action in this regard
without the express written permission of Pepsi.

6.5    REMEDY FOR BREACH.  PRI acknowledges and agrees that a breach of any of
       the covenants, agreements or undertakings of this Article 6 or Article 8
       below will cause Pepsi irreparable injury which cannot be readily
       remedied in damages or solely by termination of this Agreement and that
       Pepsi, in addition to all other legal and equitable remedies, including
       costs and attorneys' fees, shall be entitled to injunctive relief without
       any requirement to post bond, for any such breach by PRI.

                                     ARTICLE 7
                                  INDEMNIFICATION

7.1    INDEMNITY BY PRI.  PRI shall defend, indemnify and hold Pepsi, its
       subsidiaries and affiliates harmless from and against any and all
       liabilities, losses, damages and expenses, including without limitation
       reasonable attorney's fees and court costs, arising by reason of:

       (a)    Any breach of warranty or representation made by PRI under Article
              9 hereof;

       (b)    Any personal injury or property damage resulting from a defect in
              the materials or workmanship of the Product; or

       (c)    Any recall of the Product initiated by PRI.

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7.2    INDEMNITY BY PEPSI.  Pepsi shall defend, indemnify and hold PRI, its
       subsidiaries and affiliates harmless from and against any and all
       liabilities, losses, damages and expenses, including without limitation
       reasonable attorney's fees and court costs, arising by reason of:

       (a)    Any breach of warranty or representation made by Pepsi under
              Article 9 hereof; or

       (b)    The bringing of any suit for infringement of U.S. patent or other
              U.S. intellectual property rights of third parties relating solely
              to the practice by PRI of the Patents or the application of the
              Trademarks to the Product as authorized hereunder.

                                     ARTICLE 8
                                    EXCLUSIVITY

8.1    THE PRODUCT.  PRI shall not sell or offer to sell the Product to any
       purchaser other than Pepsi or its designees.

8.2    Competing Products.  For the Term of this Agreement, PRI agrees not to
       manufacture or sell to any competitor of Pepsi in the beverage industry,
       any container similar to the Product, as determined by function and use
       as outlined in the Patents, whether or not they eventually issue;
       provided that this exclusion shall not prevent the manufacture or sale of
       any similar container(s) that may be in commercial production by PRI as
       of the effective date of this Agreement.  For clarity, any such
       containers currently in commercial production by PRI are described in
       detail on SCHEDULE K hereto.

                                     ARTICLE 9
                           REPRESENTATIONS AND WARRANTIES

9.1    WARRANTIES BY PRI.  PRI represents and warrants that:

       (a)    It has all requisite corporate power, without the consent or
              approval of any other person or entity, to execute, deliver and
              perform under this Agreement,

       (b)    Its performance of this Agreement, and the Product manufactured
              and sold hereunder, will comply with all applicable laws,
              regulations, ordinances and governmental standards; and

       (c)    The Product manufactured and sold hereunder shall conform to
              applicable design and performance specifications, shall be free
              from defects in material and workmanship, and shall be delivered
              to the customer in a timely manner.

       (d)    It has sufficiently addressed any issues that may arise in its
              business in connection with either (a) date sensitive software or
              (b) date sensitive integrated electronic circuitry so that any
              such issues shall not materially interfere with PRI's performance
              obligations under this agreement.

                                    11

<PAGE>

9.2    WARRANTIES BY PEPSI. Pepsi represents and warrants that:

       (a)    It has all requisite corporate power, without the consent or
              approval of any other person or entity, to execute, deliver and
              perform under this Agreement, and to grant PRI the rights
              hereunder;

       (b)    Its performance of this Agreement will comply with all applicable
              laws, regulations, ordinances and governmental standards; and

       (c)    It is the owner of the Patents, the Know-How and the Trademarks.

                                     ARTICLE 10
                                   MISCELLANEOUS

10.1   NOTICES.  All notices, consents, requests and other communications
       required or permitted to be given under this Agreement shall be in
       writing and shall be deemed to have been duly given when sent addressed
       to the other party as provided below, by certified, registered or Express
       Mail, postage prepaid, or by hand delivery, with proof of receipt.

        If to Pepsi:                         If to PRI:

        Mr. Arthur Schick                    Mr. Howard Hoeper
        Group Manager, Merchandising Equip.  Chairman of the Board, President
        Pepsi-Cola Company                   Packaging Resources Incorporated
        MD 777                               One Conway Park
        1 Pepsi Way                          100 Field Drive, Suite 300
        Somers, NY  10589                    Lake Forest, IL  60045

10.2   ASSIGNMENT AND BINDING EFFECT.  This Agreement, or any of the rights
       therein, may not be transferred or assigned in whole or in part by Pepsi,
       except in connection with an assignment to successors of substantially
       all of Pepsi's beverage business or in the case of an assignment to a
       company controlled by or under common control with Pepsi, without the
       consent of PRI, not to be unreasonably withheld.  This Agreement, or any
       of the rights therein, may not be transferred or assigned in whole or in
       part by PRI without the consent of Pepsi.  If assigned, this Agreement
       shall be binding upon and shall inure to the benefit of the parties
       hereto and their respective successors and assigns.

10.3   NO WAIVER.  No failure or delay by either party to exercise its rights
       under this Agreement, or to insist upon strict performance thereof, shall
       be deemed to be a waiver by such party of its rights under this Agreement
       or of any subsequent breach by the other party.

10.4   RELATIONSHIP OF PARTIES.  The relationship of the parties hereto shall
       be that of independent contractors.  Nothing herein shall be deemed to
       create any partnership, joint venture or agency relationship between the
       parties or shall be deemed to render either party liable for the debts or
       obligations of the other.

                                    12

<PAGE>

10.5   DELAYS.  Neither party to this Agreement shall be considered in
       default in the performance of its obligations hereunder to the extent
       that such performance is prevented or delayed by any cause which is
       beyond the reasonable control of such party and which cannot be
       overcome by due diligence; provided that the affected party gives
       prompt notice to the other party and uses diligent efforts in good
       faith to overcome the cause of the delay.

10.6   GOVERNING LAW.  This Agreement and the legal relations between the
       parties hereto shall be governed by and construed in accordance with the
       laws of the State of New York without regard to conflicts of laws
       principles thereof.

10.7   ENTIRE AGREEMENT.  This Agreement contains the entire agreement of the
       parties hereto relating to the subject matter hereof, and no oral or
       written statements or representations not embodied herein shall be of any
       force or effect.  This Agreement cannot be amended except by a written
       instrument executed by both parties hereto.

10.8   SURVIVAL OF PROVISIONS.  The expiration or termination of this
       Agreement shall not affect those provisions, and the rights and
       obligations therein, of this Agreement which either:

       (a)    by their terms state, or evidence the intent of the parties, that
              the provisions survive such expiration or termination; or

       (b)    must survive to give effect to the provisions of this Agreement.

10.9   SEVERABILITY.  If any provision of this Agreement shall be declared by
       any court of competent jurisdiction to be illegal, void or
       unenforceable, all other provisions of this Agreement shall be
       unaffected and shall remain in full force and effect.

10.10  MINORITY BUSINESS.  The parties agree to explore all reasonable
       opportunities to utilize Minority Business enterprises in support of this
       business.

10.11  HEADINGS.  The article and section headings appearing in this
       Agreement are inserted only for purposes of convenience and are not to
       be construed as part of this Agreement or as a modification of the
       scope of any terms or provisions thereof.

10.12  YEAR 2000.  Supplier represents and warrants that it has sufficiently
       addressed any issues that may arise in its business in connection with
       either (a) date sensitive software or (b) date sensitive integrated
       electronic circuitry so that any such issues shall not materially
       interfere with Supplier's performance obligations under this agreement.

                                     13

<PAGE>

       IN, WITNESS WHEREOF, the parties hereto by their duly authorized
representatives have executed this Agreement as of the date first above
written.

          PEPSI-COLA COMPANY                 PACKAGING RESOURCES INCORPORATED
          a division of PEPSICO, INC.

          By: /s/ John Swanhaus              By: /s/ Howard P. Hoeper
              ------------------------          --------------------------
          Date: September 9, 1999            Date: September 9, 1999
               -----------------------            ------------------------

          Name:  John Swanhaus               Name:  Howard Hoeper
          Title: Vice President,            Title:  Chairman of the Board
                 Customer Marketing

                                    14

<PAGE>

                                      SCHEDULE A

Cup drawing #7005-100-001 revised on 3/17/99
Lid drawing #7001-100-001 revised on 3/19/99
Spout drawing #7000-044-001 dated 11/23/98

                                          15

<PAGE>

Schedule B - Twist 'n Go Product Specification and Test Methods
                            (7 pages)

<PAGE>

PEPSI TWIST 'N GO SPECIFICATION - 32 OZ. CONTAINER SIZE

1.     APPEARANCE/CONSTRUCTION

       1.1.   The TNG32 product consists of 3 component parts. The manufactured
              geometry is controlled by the following drawings:

              1.1.1. Cup: drawing #: 7005-100-001

              1.1.2. Lid: drawing #: 7001-100-001

              1.1.3. Spout drawing #: 7000-044-001

              1.1.4. Straw: Length to be [*], diameter to be less
                     than or equal to [*].

       1.2.   APPEARANCE

              1.2.1. Appearance to be consistent with containers used for soft
                     drinks. The container will be free of cosmetic defects,
                     sharp points and edges (as defined by ACTS sharp point test
                     method) and shall conform to the specifications below.

       1.3.   COLORS

              1.3.1. Cup to be natural color Polypropylene, to be printed using
                     offset printing in up to 8 color flat line art or
                     equivalent.

              1.3.2. Spout to be Pepsi blue Pantone color #: 287, as determined
                     by the use of Hannah concentrate #10023241.

              1.3.3. Lid to be clarified Polypropylene.

       1.4.   GRAPHICS

              1.4.1. Product graphics are to be controlled per Pepsi approved
                     sample.

              1.4.2. Graphic artwork to be supplied by Pepsi.

2.     CONFIGURATION/SIZE

       2.1.   CAPACITY

              2.1.1. Capacity of the Cup to be 33.8 fl. oz. or 1000.4 cc. when
                     the Cup is filled to the top rim of the cup, as outlined by
                     the Volume Measurement Procedure in TNG TEST METHOD 2.1.

       2.2.   NESTING

              2.2.1. Cups will nest to a pitch height of [*].

              2.2.2. Lid assembly will nest to a pitch height of [*].

              2.2.3. Cup and Lid assembly sleeved and co-packed, to fit a custom
                     box and not to exceed a total weight of 35 lb. Box to
                     contain [*] Cups and [*] Lid assemblies.

              2.2.4. Straws are to be shipped separately or included in the
                     32TNG case at an optional cost.

       2.3.   COMPATIBILITY

              2.3.1. Height of Cup to be less than or equal to [*] to fit
                     under [*] high fountain.

<PAGE>

              2.3.2. Diameter of the Cup, at a height of 1.98" from the bottom
                     of the cup, to be less than 2.75". To fit into car cup
                     holder.

       2.4.   DRINK PRODUCTS

              2.4.1. Compatible with the full range of Pepsi's carbonated and
                     non-carbonated products.

              2.4.2. Ice will likely be part of the drink product.

       2.5.   STABILITY

              2.5.1. Assembled product filled with Pepsi and in any orientation
                     to tilt to an angle of at least [*] DEG. from vertical as
                     specified in Stability Test in TNG TEST METHOD 2.2.

3.     MANUFACTURE

       3.1.   PARTS

              3.1.1. Damaged product should be eliminated from the production
                     flow and considered scrap.

       3.2.   TOOLS

              3.2.1. Each cavity in every tool to be uniquely numbered. The
                     number is to appear on the molded part.

       3.3.   MATERIALS

              3.3.1. Cup: PP grade to be Montell SC916 or Pepsi approved
                     equivalent.

              3.3.2. Lid: PP grade to be a blend of 70% Exxon PD9505 and 30%
                     Montell PD701N or Pepsi approved equivalents.

              3.3.3. Spout: PE grade to be a blend 60% Union Carbide HDPE DMDA
                     8940 and 40% Dow Plastics LDPE 9551 or Pepsi approved
                     equivalents.

              3.3.4. Bottom of cup to be marked with a recycling symbol for
                     polypropylene.

4.     ASSEMBLY

       4.1.   COMPONENTS

              4.1.1. Assembly consists of a Cup, Lid, Spout and a straw. A bag
                     containing 160 straws is supplied separately and included
                     in the finished case.

              4.1.2. The Spout and Lid are assembled by the manufacturer and
                     shipped as the Lid assembly.

       4.2.   SPOUT/LID ASSEMBLY

              4.2.1. Spout is to be "snapped" onto the lid.

              4.2.2. Spout to be assembled in the fully closed position.

              4.2.3. Assembly process will not permanently deform or damage in
                     any way Lid or Spout components.

<PAGE>

5.     USABILITY

       5.1.   SPOUT OPERATION

              5.1.1. The torque required to initially turn the Spout should be
                     less than 6 in-lb. when applied uniformly to the Spout as
                     per the Spout Torque Test in TNG TEST METHOD 2.3.

6.     SEALING

       6.1.   VENTING

              6.1.1. The assembled product will vent mainly through the Spout
                     seals.

       6.2.   DRIP RATE THROUGH SPOUT

              6.2.1. Drip rate of the secondary seal to be less than 1.4 fl oz
                     per minute (45 cc/minute) as defined in Spout Seal Test
                     specified in TNG TEST METHOD 2.4.

              6.2.2. Drip rate to apply throughout the life of the product as
                     defined in section 7.2.1.

       6.3.   CUP/LID SEAL

              6.3.1. The average leak rate for the Cup/Lid interface shall be
                     less than or equal to 0 fl. oz (0 cc) when observed over a
                     24 hour periods, as specified in the Cup Seal Test as
                     specified in TNG TEST METHOD 2.5.

              6.3.2. Cups with nicks in their rim are considered damaged and
                     ought to be eliminated from production and considered
                     scrap.

              6.3.3. The minimum tightening torque used to seal the Lid onto the
                     Cup to be determined after evaluation of the prototype
                     tools.

              6.3.4. The seal should not leak when the Cup is subject to
                     diametrical compression up to 10 lb. as specified in Cup
                     Compression Test in TNG TEST METHOD 2.6.

              6.3.5. The Cup/Lid seal should remain intact after a 12" Drop Test
                     as specified in TNG TEST METHOD 2.7.

7.     PRODUCT LIFE

       7.1.   STORAGE

              7.1.1. Product should meet this specification for a period of 9
                     months from the date of manufacture so long as containers
                     are stored between 50F and 100F.

       7.2.   PRODUCT WILL MEET THIS SPECIFICATION FOR THE FOLLOWING NUMBER OF
              CYCLES:

              7.2.1. 40 spout opening/closing cycles

              7.2.2. Cup/Lid cycles to be determined.

       7.3.   ENVIRONMENTAL

              7.3.1. Warehouse storage temperature range to be 50 DEG F to 100
                     DEG F.

              7.3.2. Product to be stored protected from direct sunlight.

<PAGE>

8.     AGENCY APPROVALS

       8.1.   MATERIALS TO HAVE FDA APPROVAL FOR DIRECT CONTACT WITH FOOD, TO
              MEET FDA FOOD SIMULATING SOLVENT EXTRACTIVES 21 CFR 177.1520.

       8.2.   MATERIALS TO BE APPROVED BY PEPSI'S TASTE TEST PANEL EXPERTS NOT
              TO TAINT DRINK PRODUCTS.

       8.3.   INKS/DYES NOT TO CONTAIN HEAVY METALS, TO MEET ACTS 16 CFR 1303
              CPSA & ASTM F963-96a, OR EQUIVALENT.

       8.4.   ASSEMBLED PRODUCT (LESS STRAW) WILL MEET ACTS MECHANICAL DROP
              TEST, 16 CFR PART 1500, OR EQUIVALENT.

       8.5.   ASSEMBLED PRODUCT (LESS STRAW) WILL MEET ACTS SMALL PARTS SAFETY
              TEST, OR EQUIVALENT.

       8.6.   ASSEMBLED PRODUCT (LESS STRAW) WILL MEET ACTS FLAMMABILITY SAFETY
              TEST, 16 CFR 1500.44, OR EQUIVALENT.

       8.7.   PRODUCT AS SHIPPED WILL MEET ASTM F963-92-PRECONDITIONING TEST
              (TEMPERATURE EVALUATION), OR EQUIVALENT.

       8.8.   PRODUCT AS SHIPPED WILL MEET NATIONAL SAFE TRANSIT ASSOCIATION
              (NSTA) SHAKE AND DROP TEST, OR EQUIVALENT.

9.     DOCUMENTATION STANDARDS

       9.1.   DRAWING STANDARDS

              9.1.1. Drawings to meet ASME Y14.5M-1994 standard or equivalent
                     standard agreed to be Pepsi.

              9.1.2. Drawing units to be in inches.

              9.1.3. All drawings to show Pepsi logo except those issued to
                     toolmakers.

              9.1.4. Electronic database to be ProEngineer version 18, 19 or 20
                     or Unigraphics.

<PAGE>

PEPSI TEST METHODS

       2.3.   SPOUT TORQUE TEST

              2.3.1. The Spout should be closed and must not have been
                     previously opened (as shipped condition).

              2.3.2. The Spout is gripped in a fixture that is close fitting and
                     does not deform the Spout.  A soft rubber imprint molding
                     is recommended.  The Spout fixture is attached to a torque
                     gauge.

              2.3.3. The Lid is gripped by a fixture around the flange.
                     Alternatively, the bottom of the cup may be rotated, while
                     it is attached to the lid. This will minimize lid
                     deformation.

              2.3.4. The maximum torque required to rotate the Spout to an open
                     position (immediately prior the hard stop) is noted.

       2.4.   SPOUT SEAL TEST

              2.4.1. The cup is filled with cool tap water and the lid is
                     applied to a torque of 25 in-lb. The filled product is
                     placed up side down in a fixture, which supports the rim of
                     the Lid evenly.

              2.4.2. Leaked water is collected for a duration of 5 minutes, then
                     weighed and converted to volume. (Conversion factors listed
                     in 1.6.2.)

       2.5.   CUP SEAL TEST

              2.5.1. The cup is filled with 700 mls of cool tap water and the
                     lid is applied to a torque of 25 in-lb. This filled product
                     is placed on its side, and orientated so that the spout is
                     in the 12 o'clock position, when looking at the product
                     head-on. This will establish the water level below the
                     spout, thus isolating any potential leakage to the Cup/Lid
                     interface.

              2.5.2. Leaked water is collected for a duration of 24 hours
                     directly below the Cup/Lid interface, then weighed and
                     converted to volume. (Conversion factors listed in 1.6.2.)

       2.6.   CUP COMPRESSION TEST

              2.6.1. The cup is filled with 700 mls of cool tap water and the
                     lid is applied to a torque of 25 in-lb. The filled
                     product's weight is measured.
\
              2.6.2. This filled product is placed on its side, and orientated
                     so that the spout is in the 12 o'clock position, when
                     looking at the product head-on. This will establish the
                     water level below the spout, thus isolating any potential
                     leakage to the Cup/Lid interface.

              2.6.3. A compressive load of 10 lb. is applied in a vertical
                     (radial direction to the long axis of the product)
                     direction to the Cup, 0.5" below the Cup flange. The load
                     is applied for a duration of 30 seconds.

              2.6.4. The product is weighed again. The difference in weight is
                     converted into leak volume. (Conversion factors listed in
                     1.6.2.)

<PAGE>

       2.7.   12" DROP TEST

              2.7.1. A filled product is dropped in a horizontal orientation
                     onto a flat hard surface from a height of 12".

              2.7.2. The condition of the assembly is inspected and any leakage
                     noted.

<PAGE>

SCHEDULE C - 32 OZ. TWIST 'N GO RESIN FORMULA AND PRICING

<TABLE>
<CAPTION>

                                                   PART               RESIN
                                   PERCENT         GRAM               GRAM          MARKET PRICE ($/LB.)        PART COST
PRODUCT PART RESIN TYPE            COMPOSITION     WEIGHT             WEIGHT        (AS OF 4/9/99)              ($/THOU.CONTAINERS)
-----------------------------------------------------------------------------------------------------------------------------------
<S>          <C>                   <C>             <C>                <C>           <C>                         <C>
Cup          Montel SC916                [*]         [*]                 [*]                      [*]                         [*]

Lid          Exxon PD9505                [*]         [*]                 [*]                      [*]                         [*]
             Montel PD 701N              [*]         [*]                 [*]                      [*]                         [*]

Spout        Union Carbide 8940          [*]         [*]                 [*]                      [*]                         [*]
             Dow 9551                    [*]         [*]                 [*]                      [*]                         [*]

                                                   --------------------------                                   -------------------
TOTALS                                               [*]                 [*]                                                  [*]

AVERAGE RESIN COST                                                                                [*]

OPTIONAL LID RESIN

Lid          Montel SR832M               [*]         [*]                 [*]                      [*]                         [*]

</TABLE>

<PAGE>

SCHEDULE E - TWIST 'N GO COMMERCIALIZATION TIMETABLE

<PAGE>

PACKAGING RESOURCES, INC.
NEW VIENNA TECH CENTER
PEPSI 32 OZ TWIST 'N GO COMMERCIALIZATION SCHEDULE, VERSION 5
APRIL 12, 1999

<TABLE>
<CAPTION>
                                  -------------------------------------------------------------------------------------------------
          TENTATIVE DATES
                                  7/30/99  8/6/99   8/13/99  8/20/99  8/27/99  9/3/99   9/10/99  9/17/99  9/24/98  10/1/99  10/8/99
-----------------------------------------------------------------------------------------------------------------------------------
<S>                               <C>      <C>      <C>      <C>      <C>      <C>      <C>      <C>      <C>      <C>      <C>
AVAILABLE ASSEMBLIES/WEEK           N/A     N/A       630      950     1,010    1,200    1,200    1,200    1,600    1,600    1,923
-----------------------------------------------------------------------------------------------------------------------------------

-----------------------------------------------------------------------------------------------------------------------------------
                INVENTORY             0       0       630    1,580     2,590    3,790    4,990    6,190    7,790    9,390   11,313
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

cc:  Walt Riesen - NV                            Data shown above is in 1,000's.
     Dan Curliss - EOTC
     Howard Hoeper - LF
     Joanna Hoeper - LF
     Art Schick - Pepsi

<PAGE>

                     SCHEDULE F - EQUIPMENT DEPRECIATION SCHEDULE

<TABLE>

                                                                        INITIAL
                                                                        CAPITAL           DEPRECIATION
ASSET DESCRIPTION                            MODEL TYPE                   COST               YEAR
-------------------------                    -----------------        ----------        --------------
<S>                                          <C>                     <C>               <C>
HUSKY INJECTION MACHINE-CUP                  GL750RSJ 40/120               [*]                 [*]
  (INCLUDES PARTS HANDLING EQUIPMENT)        T-193

HUSKY INJECTION MACHINE-CUP                  GL750RSJ 40/120               [*]                 [*]
  (INCLUDES PARTS HANDLING EQUIPMENT)        T-193

HUSKY INJECTION MACHINE-CUP                  GL750RSJ 40/120               [*]                 [*]
  (INCLUDES PARTS HANDLING EQUIPMENT)        T-193

HUSKY INJECTION MACHINE-CUP                  GL750RSJ 40/120               [*]                 [*]
  (INCLUDES PARTS HANDLING EQUIPMENT)        T-193

HUSKY INJECTION MACHINE-LID                  GL750RSJ 40/120               [*]                 [*]

HUSKY INJECTION MACHINE-LID                  GL750RSJ 40/120               [*]                 [*]

HUSKY INJECTION MACHINE-LID                  GL750RSJ 40/120               [*]                 [*]

HUSKY INJECTION MACHINE-LID                  GL750RSJ 40/120               [*]                 [*]

XL 500P INJECTION MACHINE                    XL 500P                       [*]                 [*]
  (INCLUDES PARTS HANDLING EQUIPMENT)

VAN DAM 8 COLOR PRINTER                      568 SERIES                   [*]                 [*]

VAN DAM 8 COLOR PRINTER                      568 SERIES                   [*]                 [*]

LID AND SPOUT ASSEMBLY MACHINE                                            [*]                 [*]
  (INCLUDES PARTS HANDLING EQUIPMENT)

LID AND SPOUT ASSEMBLY MACHINE                                            [*]                 [*]
  (INCLUDES PARTS HANDLING EQUIPMENT)

</TABLE>

NOTE: THE COST ABOVE REPRESENTS THE ORIGINAL COSTS OF THE EQUIPMENT EXCEPT FOR
THE XL 500P INJECTION MACHINE WHICH IS A USED MACHINE. THE COST OF THIS MACHINE
REPRESENTS THE NET BOOK VALUE AT 2/28/99 PLUS THE COST TO MODIFY IT.

<PAGE>

     ----------                         PACKAGING RESOURCES, INC.
     PACKAGING                          EASTERN OPERATIONS TECHNICAL CENTER
     ----------                         5566 NEW VIENNA ROAD
     RESOURCES                          NEW VIENNA, OHIO 45159
     ----------                         TELEPHONE, 937-987-3047
     Schedule G                         FAX, 937-987-3077
     ----------

FACSIMILE COVER SHEET                   DATE:     December 16, 1998

TO:             Art Schick              FROM:     Mike Liming

COMPANY:        Pepsi-Cola Company

FAX #           1-914-767-1828          CC:       Walt Riesen
                                                  Dan Curliss
PAGES:                      2                     Joanna Hoeper
                                                  Howard Hoeper
-------------------------------------------------------------------------------

  REGARDING : Tool Maintenance for the 32 oz Twist'n Go Project

Attached is the Recommended Tool Maintenance Program you requested. All costs
are estimates at this time. Actual cost to Pepsi for any of the repairs listed
below should be discussed with Howard Hoeper.

PREVENTATIVE MAINTENANCE
Preventative maintenance will be performed in the injection molding machine
on a weekly basis. This type of program is currently performed on many of our
other high output tools. Our major objective is to clean the parting line
faces of contamination which results in excessive hobbing of the faces and
shortening the tool life. Most of the contamination comes from gas build up
on the mold parting line surfaces. Gas build up results when the resin is
under high pressure during injection and must escape through predetermined
vent areas along the parting line face. This high velocity of gas leaves
behind a black residue which if not cleaned properly can cause wear on the
parting line face.

MINOR MAINTENANCE
Minor maintenance will allow us to maintain the visual quality and dimensional
stability of the product. Surface finishes will be maintained to keep the visual
quality correct. The venting of the inserts will be maintained so the tool can
fill properly and hold the dimensional stability.

Estimated cost for each cup tool is [*] per tool, which results in [*] annually
per tool.
Estimated cost for each lid tool is [*] per tool, which results in [*]
annually per tool.
Estimated cost for the spout tool is [*], which results in [*] annually.

MAJOR REBUILD
Major rebuild will be required as minor maintenance fails to maintain the
visual quality and dimensional stability of the product. The parting lines
will be re-established with the molding surfaces specifications. This may
require repairing and/or replacing certain key items within the tool.

Estimated cost for each cup tool is [*] per tool every two years, [*]
annually per tool.
Estimated cost for each lid tool is [*] per tool annually.
Estimated cost for the spout tool is [*] every year and a half, [*] annually.

Please call if you have questions or concerns. Thanks!

<PAGE>

PACKAGING RESOURCES, INC.
EASTERN OPERATIONS TECHNICAL CENTER
RECOMMENDED INJECTION TOOL MAINTENANCE
For 32 oz Twist'n Go Tooling
December 16, 1998

<TABLE>
<S>                                                                       <C>
I    PREVENTATIVE MAINTENANCE
     (Performed in the machine)

                                                                                     FREQUENCY
     A    Cup tool, sides, air eject.                                      Weekly (estimated 47,000 cycles)
          1.   clean cavity tapers and molding surface
          2.   clean cavity plate
          3.   clean core taper and molding surface
          4.   clean core slide tapers and molding surface
          5.   clean core slide plate and re-lubricate

     B.   Lid tool, rotating ratchet ring, mechanical ejection.            Weekly (estimated 40,000 cycles)
          1.   clean cavity faces and molding surface
          2.   clean cavity plate
          3.   clean core molding surfaces
          4.   clean core plate

     C.   Spout tool, expandable cavity, mechanical ejection.              Weekly (estimated 54,000 cycles)
          1.   clean cavity faces and molding surface
          2.   clean cavity plate
          3.   clean core molding surfaces
          4.   clean expandable cavity taper and molding surfaces

II.  MINOR MAINTENANCE
     (Performed at the Tech Center)
                                                                                     FREQUENCY
     A.   Cup, lid, and spout tools                                        cup tool - every six months (timing one week)
          1.   dis-assemble inserts from mold frame                        lid tool - every four months (timing one week)
          2.   dis-assemble hot runner from mold frame                     spout tool - every four months (timing one week)
          3.   clean all inserts
          4.   re-finish molding surfaces of inserts to original
                 specification as needed
          5.   vent inserts where necessary
          6.   clean all plates
          7.   replace pins and bushings as needed
          8.   clean hot runner exterior
          9.   inspect and log tip heights on hot runner
          10.  replace tips and tip heaters on hot runner as needed
          11.  assemble inserts and hot runner to mold frame
          12.  water check
          13.  air check

III. MAJOR REBUILD
     (Performed at the Tech Center)
                                                                                     FREQUENCY
     A.   Cup, lid, and spout tools                                        cup tool - every 24 months (timing four weeks)
          1.   dis-assemble inserts from mold frame                        lid tool - every 12 months (timing four to five weeks)
          2.   dis-assemble hot runner from mold frame                     spout tool - every 18 months (timing five weeks)
          3.   clean all inserts
          4.   inspect all inserts
          5.   plate, grind, and/or machine all parting line surfaces to
                 re-establish proper molding surface specifications
          6.   re-finish molding surfaces of inserts to original
                 specification as needed
          7.   replace and/or repair sprues
          8.   replace and/or repair taper lock items
          9.   vent inserts where necessary
          10.  clean all plates
          11.  inspect all plates, grind if necessary
          12.  replace pins and bushings as needed
          13.  replace and/or rebuild air or hydraulic cylinders
          14.  clean hot runner exterior
          15.  inspect and log tip heights on hot runner
          16.  replace tips and tip heaters on hot runner as needed
          17.  assemble inserts and hot runner to mold frame
          18.  water check
          19.  air check
</TABLE>

<PAGE>

SCHEDULE H - TARGET MOLDING CYCLE TIMES
<TABLE>
<CAPTION>
                                Target
               Mold             Cycle
Part           Cavitation       Time (sec.)      Actual at Full Production
-------        -----------      -----------      ------------------------------
<S>            <C>              <C>              <C>
Spout                [*]               [*]

Lid                  [*]               [*]

Cup                  [*]               [*]
</TABLE>

<PAGE>

SCHEDULE I - FINISHED PRODUCT PRODUCTION TARGETS
           (6 pages)

           [*]

<PAGE>

[LOGO]                             SCHEDULE J

                                                               Howard P. Hoeper
                                                          Chairman of the Board
                                                                      President

                                                                02 October 1998

Mr. Arthur J. Schick
Director - Supplier Development
THE PEPSI COLA COMPANY
1 Pepsi Way
Somers, New York 10589-2201

RE: TWIST N' GO

Dear Arthur:

Set forth below are the volume discounts for the Twist N' Go to be included in
our Memo of Understanding as Schedule D.

         Volume                     Per Cup Price
         ------                     -------------

1.       [*]                        [*]

2.       [*]                        [*]

3.       [*]                        [*]

4.       [*]                        [*]

Sincerely,

/s/ Howard

Howard P. Hoeper
President & CEO

CC: Cie Nicholson

                      Packaging Resources Incorporated
One Conway Park - 100 Field Drive - Suite 300 - Lake Forest, Illinois 60045 -
                      847/615-5301 - Fax 847/295-3707

<PAGE>

                      SCHEDULE K - COMPETING PRODUCTS
                                (2 pages)

<PAGE>

                              YOUR RESOURCE
                  FOR PROMOTIONAL CUPS | IDEAS | GRAPHICS

                                [GRAPHIC]<PAGE>

                        PACKAGING RESOURCES INCORPORATED
                                 SEVERANCE PLAN

                                    ARTICLE I
                                  INTRODUCTION

         1.1 PURPOSE. Packaging Resources Incorporated Severance Plan (the
"Plan") has been established by Packaging Resources Incorporated (the "Company")
to provide severance pay to certain employees who "terminate" employment with
the Company or an affiliate of the Company under certain circumstances.

         1.2 EFFECTIVE  DATE. The effective date of the Plan (the "Effective
Date") is April 20, 2000.

                                   ARTICLE II
                                   DEFINITIONS

         2.1 "CAUSE" means personal dishonesty, incompetence, willful
misconduct, breach of fiduciary duty involving personal profit, intentional
failure to perform stated duties or willful violation of any law, rule or
regulation or final cease-and-desist order which results in a material loss to
an Employer.

         2.2 "CHANGE OF CONTROL" shall be deemed to occur upon the consummation
by the Company of a reorganization, merger or consolidation or a sale or other
disposition of all or substantially all of the assets of the Company or of a
majority of the voting stock of the Company which has been approved or
recommended by individuals who, as of the date hereof, constitute the Board of
Directors of the Company.

         2.3 "COVERED EMPLOYEES" means the Tier I Employees and the Tier II
Employees.

         2.4 "EMPLOYER" means the Company and any successors or assigns of any
of the foregoing.

         2.5 "GOOD REASON" shall exist if, without the Covered Employee's
express written consent:

             (a) an Employer reduces the nature, scope, level or extent of the
         Covered Employee's responsibilities from the nature, scope, level or
         extent of such responsibilities prior to the Change of Control, or an
         Employer fails to provide the Covered Employee with adequate office
         facilities and support services to perform the nature, scope, level or
         extent of the Covered Employee's responsibilities;

             (b) an Employer reduces the Covered Employee's salary below his or
         her salary in effect as of the date of the Change of Control;

             (c) an  Employer requires the Covered Employee to relocate the
         Covered Employee's principal business office or principal place of
         residence from its location on the Effective Date, or assigns to the
         Eligible Employee duties that would reasonably require such relocation;
         or

             (d) an Employer fails to continue in effect any cash or stock-based
         incentive or bonus plan, pension plan, welfare benefit plan, or other
         benefit plan, program or arrangement,

<PAGE>

         unless the aggregate value (as computed by an independent employee
         benefits consultant selected by an Employer) of all such compensation,
         pension and welfare benefit plans, programs and arrangements provided
         to the Covered Employee is not materially less than their aggregate
         value as of the date of the Change of Control.

         2.6 "SEVERANCE PAY" means the amount of a Covered Employee's  severance
pay as identified on SCHEDULES A and B to the Plan.

         2.7 "TIER I EMPLOYEE" means the employees identified on SCHEDULE A
to the Plan.

         2.8 "TIER II EMPLOYEES" means the employees identified on SCHEDULE B to
the Plan.

                                   ARTICLE III
                                    BENEFITS

         3.1 COVERED TERMINATIONS. A Tier I Employee is eligible to receive
Severance Pay upon a Change of Control. A Tier II Employee whose employment with
an Employer is terminated within six months of a Change of Control by such
Employer for any reason except as listed in SECTION 3.2 or by such Tier II
Employee for Good Reason is eligible to receive Severance Pay under the Plan.

         3.2 TERMINATIONS NOT COVERED. In no event shall a Tier II Employee who
is terminated because of a voluntary resignation (other than for Good Reason) or
discharge for Cause be eligible to receive Severance Pay under the Plan.
Notwithstanding anything to the contrary herein, in no event shall a Covered
Employee who receives, or is eligible to receive, benefits under the Packaging
Resources Change of Control Plan be eligible to receive Severance Pay under the
Plan.

         3.3 AMOUNT OF SEVERANCE PAY. A Covered Employee who is eligible to
receive Severance Pay under the Plan shall receive the amount of Severance Pay
identified opposite such Covered Employees name on SCHEDULE A or SCHEDULE B to
the Plan, as applicable. Severance pay under the Plan shall be in addition to
accrued but unpaid vacation benefits payable in connection with the Covered
Employee's termination of employment.

         3.4 PAYMENT OF SEVERANCE PAY. A Tier I Employee's Severance Pay under
the Plan shall be paid to him in a single sum immediately upon the occurrence of
a Change of Control, subject to the provisions of SECTION 3.2. A Tier II
Employee's Severance Pay under the Plan shall be paid to him or her in a single
sum immediately upon his or her termination of employment with an Employer,
subject to the provisions of SECTION 3.2.

                                   ARTICLE IV
                                 ADMINISTRATION

         4.1 ADMINISTRATOR; POWERS AND DUTIES. The Company shall administer the
Plan. The Company shall have the following powers, duties and discretion, in
addition to all other powers and discretion otherwise provided by the Plan and
applicable law:

             (a) to make, amend and enforce such rules and regulations as it
         deems necessary or proper for the administration of the Plan;

<PAGE>

             (b) to construe and interpret the provisions of the Plan;

             (c) to decide all questions concerning the Plan and the eligibility
         of any person to receive benefits under the Plan, and to determine the
         amount, manner and time of any benefits under the Plan;

             (d) to prepare, file with appropriate governmental agencies and
         distribute to Covered Employees in such manner as it considers
         appropriate information, disclosures, descriptions and reporting
         documents regarding the Plan; and

             (e) to allocate and delegate its responsibilities under the Plan
         and to designate other persons to carry out any of its responsibilities
         under the Plan, any such allocation, delegation or designation to be in
         writing.

         4.2 CLAIMS PROCEDURE. All disputes shall be filed in writing with the
Company. The Company shall decide all disputes under the Plan within 30 days. If
special circumstances require, the Company shall notify the claimant in writing
within 30 days and decide the claimant's claim within 90 days. Any denial by the
Company of a claim for benefits shall be stated in writing and shall set forth
the specific reasons for the denial. In addition, the Company shall afford a
reasonable opportunity to any claimant whose claim for benefits has been denied
a review of the decision denying the claim.

                                    ARTICLE V
                            AMENDMENT AND TERMINATION

         The Board of Directors of the Company may amend, abandon or terminate
the Plan in whole or in part from time to time; PROVIDED, HOWEVER, that no
amendment, abandonment or termination may reduce the amount of benefits payable
to any Covered Employee under ARTICLE III or the circumstances under which such
benefits are payable, unless each affected Covered Employee agrees in writing to
the modification, waiver or discharge.

                                   ARTICLE VI
                                  MISCELLANEOUS

         6.1 NO CONTRACT OF EMPLOYMENT. The Plan shall not constitute an
employment contract and shall not expand a person's employment rights with an
Employer. All Employees are "at will" employees of an Employer unless otherwise
specified in a written agreement signed on behalf of such Employer.

         6.2 GOVERNING LAW. THE PLAN SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS TO THE EXTENT NOT INCONSISTENT
WITH FEDERAL LAW.

         6.3 CONSTRUCTION.  The masculine gender, where appearing in the Plan,
shall be deemed to include the feminine gender.

<PAGE>

         IN WITNESS WHEREOF, the Company has caused the Plan to be executed as
of the Effective Date.

                             PACKAGING RESOURCES INCORPORATED

                             By: /s/ Howard P. Hoeper
                                 Name: Howard P. Hoeper
                                 Title: President and Chief Executive Officer

                                Schedule A

                                   [*]

                                Schedule B

                                   [*]

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