FORM 10-K405

MOLSON COORS BREWING CO

(Annual Report (Regulation S-K, item 405))

Filed 3/30/1998 For Period Ending 12/28/1997

Address P.O. BOX 4030, MAIL #NH375

GOLDEN, Colorado 80401

Telephone 303-277-3271

CIK 0000024545

Industry Beverages (Alcoholic)

Sector Consumer/Non-Cyclical

Fiscal Year 12/28

U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549

FORM 10-K

x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)

For the fiscal year ended December 28, 1997 OR

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class Name of each exchange on which registered None None

Securities registered pursuant to Section 12(g) of the Act:

Class B Common Stock (non-voting), no par value (Title of class)

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

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

State the aggregate market value of the voting stock held by non- affiliates of the registrant: All voting shares are held by Adolph Coors, Jr. Trust.

Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of March 16, 1998:

Class A Common Stock - 1,260,000 shares Class B Common Stock - 35,020,455 shares

PART I

ITEM 1. Business

(a) General Development of Business

Founded in 1873 and incorporated in Colorado in 1913, Adolph Coors Company (ACC or the Company) is the holding company for Coors Brewing Company (CBC), the third-largest U.S. brewer.

For the transition period from to Commission file number 0-8251 ADOLPH COORS COMPANY (Exact name of registrant as specified in its chart er) Colorado 84-0178360 (State or other jurisdiction of (I.R.S. Em ployer Identification No.) incorporation or organization) Golden, Colorado 80401 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (303) 279-6565

CBC owns Coors Distributing Company (CDC) and several smaller subsidiaries, including Coors Transportation Company; Coors Energy Company (CEC); the majority of The Wannamaker Ditch Company and The Rocky Mountain Water Company, which carry process water from nearby Clear Creek to various CBC reservoirs in the Golden area; Coors Brewing Company International, Inc. (CBCI); Coors Global, Inc. (Global); Coors Intercontinental, Inc. (Intercontinental); Coors Nova Scotia Co. and Coors Japan Company, Ltd. (Coors Japan).

CDC owns and operates distributorships in several markets across the United States. CDC's 1997 operations accounted for approximately 5.7% of CBC's total beer sales volume.

Through a subsidiary, CEC continues to operate a gas transmission pipeline that provides energy to CBC's Shenandoah facility.

CBC, CBCI, Global and Intercontinental own Coors Brewing International C.V. (the CV), which in turn owns Coors Brewing Iberica, S.A. (Coors Iberica) and Coors Services, S.A. Established in 1995, Coors Services, S.A. provides management and administrative services to CBC. The CV acts as a holding company and a finance subsidiary.

Coors Brewing International, Ltd. (CBIL), owned by ACC and based in London, was created in December 1997. Effective January 1, 1998, it provides management and administrative services to CBC. CBIL also provides sales and distribution services for Coors products in European markets other than Spain.

In addition to CBC and CBIL, ACC owns Coors Canada, Inc. (CCI), which in turn owns a 50.1% interest in Coors Canada, a partnership. CCI's partners in Coors Canada, Carling O'Keefe Breweries of Canada, Ltd. (Carling) and The Molson Company, Ltd. (Molson Company), each own equal minority interests in the partnership. The partnership, which began operations January 1, 1998, is to develop the business related to Coors products in Canada. The partnership agreement replaces the interim arrangement that the Company and Molson Company operated under during 1997. See further discussion of the Canadian business under section (c) below.

Some of the following statements describe the Company's expectations of future products and business plans, financial results, performance and events. Actual results may differ materially from these forward-looking statements.

(b) Financial Information About Industry Segments

The Company has continuing operations in a single industry segment, the production and marketing of malt-based beverages.

(c) Narrative Description of Business

Coors Brewing Company - General

CBC produces, markets and sells high-quality malt-based beverages. CBC concentrates on distinctive premium and above- premium brands that provide higher-than-average margins. Most of CBC's sales are in U.S. markets; however, the Company is committed to building profitable sales in international markets. Sales of malt beverages totaled 20.6 million barrels in 1997, 20.0 million barrels in 1996 and 20.3 million barrels in 1995. (See Item 7 for discussion of changes in volume.)

Marketing

Principal products and services: CBC currently has 18 brands in its portfolio, of which five are premium products that make up the Coors family of beers: Coors Light(R), Original Coors(R), Coors(R) Extra Gold, Coors(R) Dry and Coors(R) Non-Alcoholic. CBC also produces and markets Zima(R), an innovative malt-based, above-premium beverage.

CBC offers specialty, above-premium beers, including Winterfest(R); Blue Moon(TM) Honey Blonde Ale; Blue Moon(TM) Belgian White Ale; Blue Moon(TM) Raspberry Cream Ale; Blue Moon(TM) Abbey Ale and Blue Moon(TM) Harvest Pumpkin Ale, a seasonal product. CBC also sells licensed products, including George Killian's(R) Irish Red(TM) Lager and George Killian's(R) Irish(TM) Honey. CBC distributed Steinlager(R), New Zealand's number-one premium beer, under license from Lion Nathan International of New Zealand until the end of 1997.

CBC also sells popular-priced products, including Keystone(R) Premium, Keystone(R) Light, Keystone(R) Dry and Keystone(R) Ice.

CBC's beverages are sold throughout the United States. CBC exports or produces and sells many products overseas, as described in greater detail below.

CBC owns and operates The Sandlot Brewery(R) at Coors Field(R) ballpark in Denver, Colorado. This brewery, which is open year- round, makes a variety of specialty beers and has an annual capacity of approximately 4,000 barrels.

New products/opportunities: Blue Moon Abbey Ale was introduced in February 1997.

During 1997, Coors Artic Ice(R) and Coors Artic Ice Light(R), Herman Joseph's(R), Blue Moon(TM) Nut Brown Ale, Killian's(R) Irish Brown(TM), Coors(R) Cutter and Keystone(R) Amber Light were discontinued because the market performances of these products did not meet expectations.

Brand names, trademarks, patents and licenses: CBC owns trademarks on all brands it produces and recognizes that consumer knowledge of and loyalty to its brand names and trademarks are vital to CBC's long-term success. It also holds several patents, with expiration dates ranging from 1998 to 2018, on innovative processes related to product formulae, can making, can decorating and certain other technical operations, together with several design patents for innovative packaging. CBC receives revenue from royalties and licenses, but its business is not dependent upon this revenue.

Brand performance: Coors Light is CBC's best-selling brand and has generated more than two-thirds of its total sales volume for the past three years. CBC's second-most-popular brand is Original Coors. Premium and above-premium beers accounted for approximately 88% of CBC's total 1997 sales volume.

Domestic sales: The Company's highest-volume states are California, Texas, Pennsylvania, New York and New Jersey, comprising 47% of total domestic volume.

Eight geographic field business areas manage domestic sales which allow CBC to better anticipate and respond to wholesaler and consumer needs.

International business: Through its U.S. and foreign production facilities, CBC markets its products to approximately 37 international markets and to U.S. military bases worldwide. Export sales are more profitable, on a per-barrel basis, than domestic sales.

Under an interim agreement that was in effect until January 1, 1998, Molson Breweries of Canada Limited (Molson) brewed and distributed Original Coors and Coors Light in Canada, where Coors Light is the best-selling light beer. After Molson permitted Miller Brewing Company (Miller) to purchase a 20% ownership interest in Molson in 1993, the Company initiated two legal actions regarding its licensing arrangement with Molson. On October 18, 1996, an arbitration panel ruled that the licensing agreement terminated in 1993 when Miller acquired its ownership interest in Molson. This ruling returned Canadian rights to all CBC brands to CBC and required Molson to compensate CBC for the period beginning April 2, 1993. In April 1997, the Company settled all legal disputes among CBC, Molson, Miller and related parties. Under terms of the settlement, Molson paid the Company approximately $72 million, which was included in ACC's second quarter 1997 results as a special credit net of certain related legal expenses. The arbitration panel also found that Molson had underpaid royalties from January 1, 1991, to April 1, 1993. Molson paid CBC $6.1 million in cash (net of $680,000 of withholding taxes) during 1996 to cover the unpaid royalties plus interest.

Coors Canada began operations January 1, 1998, to develop the business related to Coors products in Canada. Under the partnership agreement, Coors Canada is responsible for marketing Coors products in Canada, while the partnership contracts with Molson Breweries for the brewing, distribution and sales of these brands. Coors Canada receives an amount from Molson Breweries generally equal to net sales revenue generated from the Coors brands less production, distribution, sales and overhead costs related to these sales.

Coors Japan, the exclusive importer of Coors products into Japan and based in Tokyo, distributes, markets and sells CBC's products in Japan, where the Coors brand has been one of the top three foreign premium brands for 10 years.

Beginning in 1991, CBC formed Jinro-Coors Brewing Company (JCBC), a joint venture with Jinro Limited of the Republic of Korea. Until late 1997, CBC owned one-third of JCBC, while Jinro Limited owned the remaining two-thirds. JCBC's financial results have not been included in CBC's financial statements, as CBC's investment is accounted for under the cost basis of accounting, since it has not had the ability to significantly influence JCBC's business operations and the investment has been considered temporary. In December 1997, CBC exercised the put option it held on its $22- million investment in JCBC, which requires Jinro Limited to purchase, in Korean Won, CBC's investment at the greater of cost or market value by June 24, 1998. See Items 7 and 8 for further discussion of this matter.

In March 1994, Coors Iberica purchased a 500,000-hectoliter brewery in Zaragoza, Spain, from El Aguila S.A. of Madrid, Spain, which is owned 51% by Amsterdam-based Heineken, N.V. (the world's second-largest brewer). Coors Iberica brews Coorsr Gold for sale in Spain and the Coorsr Extra Gold brand for export to approximately 14 international markets. El Aguila and Coors jointly distribute Coors products in Spain, while Coors manages marketing efforts. This arrangement provides certain advantages over exporting products directly from U.S. facilities. Financial results of the Zaragoza brewery are included in ACC's financial statements.

Since September 1992, a licensing agreement has been in place that allows Scottish Courage to brew and distribute Coorsr Extra Gold in the United Kingdom. A joint venture between CBC and Scottish Courage has marketed the product during this period. Beginning in early 1998, Coors' Zaragoza, Spain brewery will be the source for Coorsr Extra Gold to be sold in the United Kingdom, and Scottish Courage will continue to distribute the product. Scottish Courage will continue to perform some packaging services.

In early 1996, ACC established a foreign sales corporation, Coors Export Ltd., to utilize favorable U.S. tax laws applicable to foreign sales.

Product distribution: A national network of 558 independent distributors and four distributorships owned and operated by CDC deliver CBC products to U.S. retail markets. Some distributors operate multiple branches, bringing the total number of U.S. distributor/branch locations to

611. Independent distributors deliver CBC products to some export/international markets under certain licensing and distribution agreements.

To ensure the highest product quality, CBC monitors distributors' methods of handling Coors products. This monitoring helps ensure adherence to proper refrigeration and rotation guidelines for CBC's malt beverages at both wholesale and retail locations. Distributors are required to replace CBC products if consumer sales have not occurred within prescribed time frames.

Transportation

Given the location of its three production facilities in the U.S., CBC must ship its products a greater distance than most competitors. By packaging some products in the Memphis and Shenandoah facilities, CBC improves the efficiency of distribution and lowers freight costs to certain markets. Major competitors have multiple breweries from which to deliver products, thereby incurring lower transportation costs than CBC.

Approximately 44% of the products packaged at CBC's production facilities are transported by railcar to satellite redistribution centers or directly to distributors throughout the country. The railcars assigned to CBC are specially built and insulated to keep Coors products cold en route. Any disruption by strike in the rail industry would impact CBC more than its major competitors, but, in management's opinion, the risk of such disruption appears low.

The remaining 56% of products are shipped by truck and intermodal (piggyback) directly to distributors or to satellite redistribution centers. Transportation vehicles are also refrigerated or insulated to keep CBC's malt beverages at proper temperatures while in transit.

CBC currently uses 14 strategically located satellite redistribution centers to receive product from production facilities and to prepare shipments to distributors. In 1997, approximately 60% of packaged products were shipped direct to distributors, and approximately 40% moved through the satellite redistribution centers.

Operations

Production/packaging capacity: CBC currently has three domestic production facilities. It owns and operates the world's largest single-site brewery in Golden, Colorado; a packaging and brewing facility in Memphis, Tennessee, and a packaging and distribution facility near Elkton, Virginia (referred to as the Shenandoah facility).

The Golden brewery is the source location for all brands with the Coors name except for Coors Non-Alcoholic. Approximately 65% of CBC's beer is packaged in Golden; most of the remainder is shipped in bulk from the Golden brewery to the Memphis and Shenandoah facilities for blending, finishing and packaging.

The Memphis facility currently packages all products exported from the United States and brews and packages Zima, Killian's Irish Honey, Coors Non-Alcoholic, and all of the Blue Moon products. CBC also contract brews small volumes of several products for other companies at the Memphis facility. Depending on product mix and market opportunities, the full utilization of brewing capacity in Memphis may or may not require additions to plant and equipment.

The Shenandoah facility currently packages certain CBC products for distribution to Eastern U.S. markets and could be expanded if necessary and if opportunities warranted the required financial commitment.

At the end of 1997, CBC had approximately 25 million barrels of annual brewing capacity and 30 million barrels of annual packaging capacity. Current capacity depends upon product mix and may change with shifting consumer preferences for specific brands or packages. CBC's three facilities provide sufficient brewing and packaging capacity to meet foreseeable consumer demand.

Most of CBC's aluminum can, end, glass bottle and malt requirements are produced in owned facilities or facilities operated by joint ventures in which CBC is a partner. CBC has arranged for sufficient container supplies with its joint venture partners and has sufficient malting facilities to fulfill its current and projected requirements.

Container manufacturing facilities: CBC owns a can manufacturing facility that produces approximately 3.8 billion aluminum cans per year, and an aluminum can end manufacturing facility, which provides CBC aluminum ends and tabs. Total container properties comprise approximately 9.0% of the book value of CBC's properties. In 1994, CBC and American National Can Company (ANC) formed a joint venture to produce beverage cans and ends at CBC's manufacturing facilities for sale to CBC and outside customers. The joint venture's initial term is seven years but can be extended for two additional three-year terms. The joint venture has improved the technology and utilization of both facilities and has enhanced the returns on this investment. In 1997, CBC purchased approximately 96% of the cans produced by the joint venture. The joint venture is committed to supplying 100% of the Golden facility's can and end requirements.

In June 1995, CBC and Anchor Glass Container Corporation (Anchor) established a joint venture partnership, the Rocky Mountain Bottle Company (RMBC), to produce glass bottles at the CBC glass manufacturing facility. The joint venture has lowered unit costs, increased output and created efficiencies at the glass plant. CBC contributed approximately $16.2 million in machinery, equipment and certain personal property to RMBC. The partnership's initial term is 10 years (ending 2005) and can be extended for additional two-year periods.

Effective February 5, 1997, Owens-Brockway Glass Container, Inc. (Owens) replaced Anchor as CBC's partner in RMBC as a result of Anchor's bankruptcy in September 1996 and the related sale of certain Anchor assets to Owens and Consumers Packaging, Inc. Further, Owens has replaced Anchor as the 100% preferred supplier of bottles to CBC for bottle requirements not met by RMBC. Owens' replacement of Anchor did not significantly impact RMBC's operations.

In 1997, RMBC produced approximately 871 million bottles; CBC purchased approximately 97% of the bottles produced. To assist in accomplishment of its goal of manufacturing bottles with recycled material, CBC constructed a glass recycling facility in Wheat Ridge, Colorado, in 1994 and doubled the amount of glass the facility can recycle annually. RMBC operates the recycling facility.

Other facilities: CBC owns waste treatment facilities that process waste from CBC's manufacturing operations and from the City of Golden.

In September 1995, CBC sold its power plant equipment and support facilities to Trigen-Nations Energy Corporation, L.L.L.P. (Trigen) for approximately $22 million. CBC has agreed to purchase from Trigen the electricity and steam needed to operate its Golden facilities. This 25-year agreement also requires that significant capital improvements be made by Trigen.

CBC continues to improve asset utilization by divesting non-core assets and by continuing to improve capacity utilization through joint ventures and alliances. CBC is exploring a combination of capital improvements and outsourcing to provide for its long-term malting needs.

Capital improvements: In 1997, the Company spent approximately $60 million in capital expenditures. While management plans to invest appropriately in order to ensure ongoing productivity and efficiency of CBC assets, a high priority will be given to those projects the Company believes offer attractive returns. The Company expects its capital expenditures for 1998 to be in the range of $75 to $85 million.

Raw Materials/Sources and Availability

CBC's beers are made with all natural ingredients, and its brewing cycle is one of the longest in the industry. CBC adheres to strict formulation and quality standards in selecting its raw materials and believes it has sufficient access to raw materials and packaging supplies to meet its quality and production requirements.

Barley, barley malt, starch and hops: CBC uses proprietary strains of barley, developed by its own agronomists, in most of its malt beverages. Virtually all of this barley is grown on irrigated farmland in the western United States under contractual agreements with area farmers. CBC's malting facility in Golden produces malt for all CBC products except Blue Moon. CBC maintains inventory levels in owned locations sufficient to continue production in the event of any disruption in barley or malt supplies.

Rice and refined cereal starch (which are interchangeable in CBC's brewing process) and foreign and domestic hops are purchased from outside suppliers. Adequate inventories are maintained to continue production through any foreseeable disruption in supply.

Water: CBC uses naturally filtered water from underground aquifers to brew malt beverages at its Golden facility. Water from private deep wells is used for brewing, final blending and packaging operations at plants located outside Colorado. Water quality and composition were primary factors in all facility site selections. Water from CBC's sources in Golden and Memphis is well balanced with minerals and dissolved solids to brew high-quality malt beverages.

CBC continually monitors the quality of all the water used in its brewing and blending processes for compliance with its own stringent quality standards as well as applicable federal and state water standards. CBC owns water rights believed to be adequate to meet all of its present requirements for both brewing and industrial uses; however, it continues to acquire water rights and add water reservoir capacity, as appropriate, to provide for long-term strategic growth plans and to sustain brewing operations in the event of a prolonged drought.

Packaging materials: During 1997, approximately 60% of CBC's malt beverages were packaged in aluminum cans. CBC purchases most of its cans and ends from the joint venture with ANC. Aluminum cans for products packaged at the Memphis plant are purchased from an outside supplier.

Glass bottles were used to package approximately 29% of CBC's beverages in 1997; about half of these bottles were produced by RMBC.

The remainder (11%) of the malt beverages sold during 1997 was packaged primarily in quarter- and half-barrel stainless steel kegs.

Graphic Packaging Corporation, a subsidiary of ACX Technologies, Inc. (ACX), supplies much of the secondary packaging for CBC's products, including bottle labels and paperboard products.

Supply contracts with ACX companies: When ACX Technologies, Inc. (ACX) was spun off from ACC in 1992, CBC negotiated long-term supply contracts with certain ACX subsidiaries for aluminum, starch and packaging materials. These contracts, negotiated at market prices, were to be in effect through 1997. The aluminum contracts were canceled in 1995, and the starch contract was extended in 1997 to run through 1999. The contract for packaging materials was modified in 1997 and extended until at least 1999. See Item 13, Certain Relationships and Related Transactions for further details.

Energy: CBC purchases electricity and steam for its Golden manufacturing facilities from Trigen. CEC supplies Trigen with coal for its steam generator system. CBC does not anticipate future energy supply problems.

Seasonality of the Business

The beer industry is subject to seasonal sales fluctuation. CBC's sales volumes are normally at their lowest in the first and fourth quarters and highest in the second and third quarters. The Company's fiscal year is a 52- or 53-week year that ends on the last Sunday in December. The 1997 and 1996 fiscal years were 52 weeks long, while fiscal 1995 was 53 weeks long.

Research and Project Development

CBC's research and project development spending relates primarily to new products and packages; brewing processes, ingredients and equipment; packaging supplies and environmental improvements and cost reductions in processes and packaging materials. These activities are meant to improve the quality and value of CBC's products while reducing costs through more efficient processing and packaging techniques and equipment design, as well as improved raw materials. Approximately $14.6 million, $15.3 million and $16.3 million were spent on research and development in 1997, 1996 and 1995, respectively. The Company expects to spend approximately $14.1 million on research and project development in 1998.

To support new product development, CBC maintains a fully equipped pilot brewery, with a 6,500-barrel annual capacity, within the Golden facility enabling CBC to brew small batches of innovative products without interrupting ongoing production and operations in the main brewery.

Regulations

Federal laws and regulations govern the operations of breweries; the federal government and all states regulate trade practices, product content and labeling, advertising and marketing practices, distributor relationships and related matters. Governmental entities also levy various taxes, license fees and other similar charges and may require bonds to ensure compliance with applicable laws and regulations. Many foreign governments apply tariffs on products such as CBC's when exported into their nations. The Company must also deal with varying levels and types of foreign government regulation when attempting to sell its products in those countries.

A number of emerging regulatory/legislative issues could impact the Company's business operations over the next few years, including: i) potential increases in federal, state and local excise taxes; ii) restrictions on the advertising and sale of alcohol beverages; iii) new packaging regulations and taxes; iv) and others.

Federal excise taxes on malt beverages are currently $18 per barrel. State excise taxes also are levied at rates that ranged in 1997 from a high of $32.65 per barrel in Alabama to a low of $0.62 per barrel in Wyoming, with an average of $7.69 per barrel. In 1997, CBC recognized approximately $386 million in federal and state excise taxes. A substantial increase in federal or state excise taxes would have a negative impact on sales and profitability of the entire industry, including CBC. CBC is vigorously opposed to any increases in federal, state or local excise taxes and will work diligently to ensure that its view is represented.

The Company anticipates increased scrutiny and focus on alcohol advertising and underage consumption among lawmakers and advocacy groups. The increased scrutiny is due to a number of circumstances outside the control of CBC. CBC intends to strengthen its and support the industry's self-regulation activities, including continuing efforts that demonstrate its social responsibility in advertising, sales, community education and prevention and research.

Environmental

Compliance with federal, state and local environmental laws and regulations did not materially affect the Company's 1997 capital expenditures, earnings or competitive position.

The Company continues to promote the efficient use of resources, waste reduction and pollution prevention. Programs currently under way include recycling, down-weighting of product packages and, where practical, increasing the recycled content of product packaging materials, paper and other supplies. Several employee task forces continually seek effective ways to control hazardous materials and to reduce emissions and waste.

Employees and Employee Relations

The Company has approximately 5,800 full-time employees. Of CBC's three domestic production facilities, Memphis plant workers are the only significant employee group that has union representation (Teamsters). In general, relations with employees have been satisfactory.

Competitive Conditions

Known trends and competitive conditions: Industry and competitive information was compiled from the following industry sources: Beer

Marketer's Insights and The Maxwell Consumer Report. While management believes these sources are reliable, the Company cannot guarantee the absolute accuracy of these numbers and estimates.

1997 industry overview: The beer industry in the United States is highly competitive. Industry volume growth has averaged less than 1% annually since 1991. In one of the most competitive years of the decade, 1997 saw domestic beer industry shipments decline slightly. By contrast, 1996 domestic shipments were up 0.8% from the year before. In recent years, brewers have attempted to gain market share through competitive pricing, marketing, promotions and innovative packaging. In 1997, price promotions and price discounting were more extensive than a year earlier, significantly reducing revenue growth for major U.S. brewers. Revenue per barrel for the two largest U.S. brewers declined in 1997, despite modest posted price increases early in the year.

The pricing environment continues to be very competitive; no nationwide increases in beer prices were announced late in 1997 or early in 1998. Instead of a posted price increase, the two largest U.S. brewers have announced plans to reduce the depth and duration of price discounting in 1998. If competitors concentrate primarily on market share gains in 1998 instead of profitability, it will place additional downward pressure on pricing. Unit volume growth for major U.S. brewers continues to depend on growth in light beer sales, pricing, introductions of new products and expansion into international markets.

A number of important trends continued in the U.S. beer market in 1997. The first was a trend toward "trading up." Consumers continued to move away from lower-priced brands to higher-priced brands, especially imports. Unlike in recent years, microbreweries as a group did not benefit from this trend in 1997. Sales by micros were flat for 1997 after years of double- digit growth in this segment. In fact, sales for six of the ten largest microbrewers were down in 1997, with the top ten as a group down 1%. In contrast, imports' sales volume rose more than 10% in 1997.

The recent proliferation of products continued to slow as major brewers focused efforts on their core brands. In 1997, CBC continued to eliminate product variations by reducing the number of brands by seven, or 28% of its portfolio. CBC now offers 18 products.

The U.S. brewing industry also continues to consolidate, primarily at the wholesale level. As a leading example, Miller Brewing Company (Miller) has reduced the number of Miller distributors to 729 in 1997 from 906 in 1995 and intends to reduce this number to approximately 500 by 2002.

CBC competitive position: CBC's malt beverages compete with numerous above-premium, premium, low-calorie, popular-priced, non- alcohol and imported brands produced by national, regional, local and international brewers. Nearly 86% of U.S. beer volume is attributable to the top four domestic brewers: Anheuser-Busch, Inc. (AB); Philip Morris, Inc., through its subsidiary Miller; CBC; and The Stroh Brewery Company (now including G. Heileman Brewing). CBC competes most directly with AB and Miller, the dominant companies in the industry. CBC is the nation's third- largest brewer and, according to Beer Marketer's Insights estimates, accounted for approximately 10.3% of the total 1997 U.S. brewing industry shipments of malt beverages (including exports and U.S. shipments of imports). This compares to AB's 45.5% share and Miller's 21.8% share.

Given its industry position, CBC continues to face significant competitive disadvantages related to economies of scale. Besides lower transportation costs achieved by competitors with multiple breweries, these larger brewers also recognize economies of scale in advertising expenditures because of their greater volume. CBC, in an effort to achieve and maintain national advertising exposure, must spend substantially more per barrel of beer sold than its major competitors. Significant levels of advertising are necessary for CBC to hold and increase its U.S. market share. Additionally, CBC is competitively disadvantaged in some markets because its distributors have lower average annual sales than distributors of competing brewers in same markets. This, coupled with ongoing price competition, puts more pressure on CBC's margins in comparison to those of CBC's principal competitors.

ITEM 2. Properties

The Company's major facilities are:

* Leased.

Facility Location P roduct Brewery/packaging Golden, CO Malt b everages/packaged malt beverages Packaging Elkton, VA Packag ed malt beverages Brewery/packaging Memphis, TN Malt b everages/packaged malt beverages Brewery/packaging Zaragoza, Spain Malt b everages/packaged malt beverages Can and end plants Golden, CO Alumin um cans and ends Distribution warehouse Anaheim, CA Wholes ale beer distribution Meridian, ID Denver, CO Oklahoma City, OK Tulsa, OK* San Bernardino, CA* Glenwood Springs, CO*

The original brewery site at Golden, which is approximately 2,400 acres, contains brewing, packaging, can manufacturing and related facilities, as well as gravel deposits and water-storage facilities.

CBC's can and end plants are operated by a joint venture between CBC and ANC. CBC's bottle plant is operated by a joint venture between CBC and Owens.

The distribution warehouses are operated by CDC.

The Company owns 2,700 acres of land in Rockingham County, Virginia, where the Shenandoah facility is located, and 132 acres in Shelby County, Tennessee, where the Memphis facility is located.

All of the Company's facilities are well-maintained and suitable for their respective operations. In 1997, CBC estimates that its brewing facilities operated at approximately 83% of the 1998 brewing capacity and its packaging facilities operated at approximately 68% of the 1998 packaging capacity. Annual production capacity can vary due to product and packaging mix and seasonality.

ITEM 3. Legal Proceedings

See the Environmental section of Item 7 Management's Discussion and Analysis of Financial Condition and Results of Operations for a discussion of the Company's obligation for potential remediation costs at the Lowry Landfill Superfund site and related legal proceedings.

The Company is party to numerous other legal proceedings arising from its business operations. In each proceeding, the Company is vigorously defending the allegations. Although the eventual outcome of the various proceedings cannot be predicted, no single such proceeding and no group of such similar matters are expected to result in liability that would be material to the Company's financial position or results of operations.

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

None.

PART II

ITEM 5. Market for the Registrant's Common Equity and Related

Stockholder Matters

Adolph Coors Company's (ACC's) Class B common stock is traded over the counter and is included in the NASDAQ National Market listings with the ticker symbol "ACCOB." Daily stock prices are listed in major newspapers, generally alphabetically under "CoorsB."

The approximate number of record security holders by class of stock at March 16, 1998 is as follows:

The range of the high and low quotations and the dividends paid per share on the Class B common stock for each quarter of the past two years are shown below. The Company expects to continue paying dividends at least at this level in the future:

Title of class Number of record holders Class A common stock, voting, All shares o f this class are $1 par value held by the Adolph Coors, Jr. Trust Class B common stock, non-voting, no par value 3,334 Preferred stock, non-voting, None issued $1 par value

1997 Market price High Low Dividends First quarter 22 1/8 17 1/2 $ 0.125 Second quarter 28 3/8 18 7/8 $ 0.125 Third quarter 39 1/4 25 5/8 $ 0.150 Fourth quarter 41 1/4 30 3/4 $ 0.150 1996 Market price High Low Dividends First quarter 24 1/4 17 3/4 $ 0.125

ITEM 6. Selected Financial Data

Following is ACC's selected financial data for 11 years ended December 28, 1997:

** 53-week year versus 52-week year.

Second quarter 19 7/8 16 3/4 $ 0.125 Third quarter 23 3/4 17 1/2 $ 0.125 Fourth quarter 22 3/4 17 1/2 $ 0.125

(In thousands, except per share) 1997 19 96 1995** 1994 Barrels of malt beverages sold 20,581 20,0 45 20,312 20,363 Summary of Operations: Net sales $1,822,151 $1,742,0 56 $1,690,701 $1,673,252 Cost of goods sold 1,120,778 1,127,6 89 1,106,635 1,073,370 Marketing, general and administrative 585,491 527,0 07 518,888 505,668 Special (credits) charges (31,517) 6,3 41 (15,200) (13,949) Total operating expenses 1,674,752 1,661,0 37 1,610,323 1,565,089 Operating income 147,399 81,0 19 80,378 108,163 Other expense - net 506 6,0 44 7,100 3,943 Income before income taxes 146,893 74,9 75 73,278 104,220 Income tax expense 64,633 31,5 50 30,100 46,100 Income from continuing operations $ 82,260 $ 43,4 25 $ 43,178 $ 58,120 Per share of common stock - basic $ 2.21 $ 1. 14 $ 1.13 $ 1.52 - diluted $ 2.16 $ 1. 14 $ 1.13 $ 1.51 Income from continuing operations as a percentage of net sales 4.5% 2. 5% 2.6% 3.5% Financial Position: Working capital $ 158,048 $ 124,1 94 $ 36,530 $ (25,048) Properties - net $ 733,117 $ 814,1 02 $ 887,409 $ 922,208 Total assets $1,412,083 $1,362,5 36 $1,384,530 $1,371,576 Long-term debt $ 145,000 $ 176,0 00 $ 195,000 $ 131,000 Other long-term liabilities $ 23,242 $ 32,7 45 $ 33,435 $ 30,884 Shareholders' equity $ 736,568 $ 715,4 87 $ 695,016 $ 674,201 Net book value per share of common stock $ 19.79 $ 18. 83 $ 18.21 $ 17.59 Total debt to total capitalization 19.0% 21. 2% 24.9% 20.6% Return on average shareholders' equity 11.3% 6. 2% 6.3% 8.9% Other Information: Dividends $ 20,523 $ 18,9 83 $ 19,066 $ 19,146 Per share of common stock $ 0.55 $ 0. 50 $ 0.50 $ 0.50 Gross profit $ 701,373 $ 614,3 67 $ 584,066 $ 599,882 Capital expenditures $ 60,373 $ 65,1 12 $ 157,599 $ 160,314 Depreciation, depletion and amortization $ 117,166 $ 121,1 21 $ 122,830 $ 120,793 Full-time employees 5,800 5,8 00 6,200 6,300 Market price range of common stock: High $ 41 1/4 $ 24 1 /4 $ 23 1/4 $ 20 7/8 Low $ 17 1/2 $ 16 3 /4 $ 15 1/8 $ 14 3/4

(In thousands, except per share) 1993 19 92 1991 1990 Barrels of malt beverages sold 19,828 19,5 69 19,521 19,297 Summary of Operations: Net sales $1,595,597 $1,566,6 06 $1,543,007 $1,483,873 Cost of goods sold 1,050,650 1,051,3 62 1,052,228 986,352 Marketing, general and administrative 467,138 441,9 43 448,393 409,085 Special charges 122,540 -- 29,599 30,000 Total operating expenses 1,640,328 1,493,3 05 1,530,220 1,425,437 Operating (loss) income (44,731) 73,3 01 12,787 58,436 Other expense - net 12,099 14,6 72 4,403 5,903 (Loss) income before income taxes (56,830) 58,6 29 8,384 52,533 Income tax (benefit) expense (14,900) 22,9 00 (8,700) 20,300 (Loss) income from continuing operations $ (41,930) $ 35,7 29 $ 17,084 $ 32,233 Per share of common stock - basic $ (1.10) $ 0. 95 $ 0.46 $ 0.87 - diluted $ (1.10) $ 0. 95 $ 0.46 $ 0.87 (Loss) income from continuing operations as a percentage of net sales (2.6%) 2. 3% 1.1% 2.2%

Note: Numbers in italics include results of discontinued operations. * Reflects the dividend of ACX Technologies, Inc. to shareholders during 1992.

Note: Numbers in italics include results of discontinued operations. ** 53-week year versus 52-week year.

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

Financial Position: Working capital $ 7,197 $ 112,3 02 $ 110,443 $ 201,043 Properties - net $ 884,102 $ 904,9 15 $ 933,692 $1,171,800 Total assets $1,350,944 $1,373,3 71* $1,844,811 $1,761,664 Long-term debt $ 175,000 $ 220,0 00 $ 220,000 $ 110,000 Other long-term liabilities $ 34,843 $ 52,2 91 $ 53,321 $ 58,011 Shareholders' equity $ 631,927 $ 685,4 45* $1,099,420 $1,091,547 Net book value per share of common stock $ 16.54 $ 18. 17* $ 29.33 $ 29.20 Total debt to total capitalization 26.3% 24. 3% 19.5% 9.2% Return on average shareholders' equity (6.4%) (0. 2%) 2.3% 3.6% Other Information: Dividends $ 19,003 $ 18,8 01 $ 18,718 $ 18,591 Per share of common stock $ 0.50 $ 0. 50 $ 0.50 $ 0.50 Gross profit $ 544,947 $ 515,2 44 $ 490,779 $ 497,521 Capital expenditures $ 120,354 $ 115,4 50 $ 241,512 $ 183,368 Depreciation, depletion and amortization $ 118,955 $ 114,7 80 $ 108,367 $ 98,081 Full-time employees 6,200 7,1 00 7,700 7,000 Market price range of common stock: High $ 23 1/8 $ 22 7 /8 $ 24 1/4 $ 27 3/8 Low $ 15 $ 15 1 /2 $ 17 3/8 $ 17 1/8

(In thousands, except per share) 1989** 1988 1987 Barrels of malt beverages sold 17,698 16,534 15,658 Summary of Operations: Net sales $1,372,373 $1, 278,097 $1,170,098 Cost of goods sold 913,994 829,423 751,056 Marketing, general and administrative 397,844 380,131 340,418 Special charges 41,670 -- -- Total operating expenses 1,353,508 1, 209,554 1,091,474 Operating income 18,865 68,543 78,624 Other expense (income) - net 2,546 (6,471) (6,022) Income before income taxes 16,319 75,014 84,646 Income tax expense 9,100 28,700 33,500 Income from continuing operations $ 7,219 $ 46,314 $ 51,146 Per share of common stock - basic $ 0.20 $ 1.26 $ 1.40 - diluted $ 0.20 $ 1.26 $ 1.40 Income from continuing operations as a percentage of net sales 0.5% 3.6% 4.4% Financial Position: Working capital $ 193,590 $ 196,687 $ 242,406 Properties - net $1,012,940 $1, 033,012 $ 975,781 Total assets $1,530,783 $1, 570,765 $1,456,493 Long-term debt $ -- -- -- Other long-term liabilities $ 16,138 $ 19,367 $ 26,376 Shareholders' equity $1,060,900 $1, 062,064 $1,031,811 Net book value per share of common stock $ 28.75 $ 29.00 $ 28.19 Total debt to total capitalization 2.0% 1.7% 0.4% Return on average shareholders' equity 1.2% 4.5% 4.8% Other Information: Dividends $ 18,397 $ 18,311 $ 18,226 Per share of common stock $ 0.50 $ 0.50 $ 0.50 Gross profit $ 458,379 $ 448,674 $ 419,042 Capital expenditures $ 149,616 $ 157,995 $ 199,541 Depreciation, depletion and amortization $ 122,439 $ 111,432 $ 99,422 Full-time employees 6,800 6,900 6,800 Market price range of common stock: High $ 24 3/8 $ 21 $ 30 Low $ 17 3/8 $ 16 1/2 $ 16 1/4

INTRODUCTION

Adolph Coor Company (ACC or the Company) is the holding company for Coors Brewing Company (CBC), which produces and markets high-quality malt-based beverages.

This discussion summarizes the significant factors affecting ACC's consolidated results of operations, liquidity and capital resources for the three-year period ended December 28, 1997, and should be read in conjunction with the financial statements and the notes thereto included elsewhere in this report.

ACC's fiscal year is a 52- or 53-week year that ends on the last Sunday in December. The 1997 and 1996 fiscal years were 52 weeks long, while fiscal 1995 was 53 weeks long.

Certain unusual or nonrecurring items impacted ACC's financial results for 1997, 1996 and 1995; restatement of results excluding special items permits clear evaluation of its ongoing operations. These special items are summarized below.

Summary of operating results:

Excluding special items - basic $1.84 $1.25 $0.89 - diluted $1.80 $1.24 $0.89

1997: For the 52-week fiscal year ended December 28, 1997, ACC reported net income of $82.3 million, or $2.21 per basic share ($2.16 per diluted share). During 1997, the Company received a $71.5-million payment from Molson Breweries of Canada Limited (Molson Breweries) to settle legal disputes with ACC and CBC, less approximately $3.2 million in related legal expenses. ACC also recorded a $22.4-million reserve related to the recoverability of CBC's investment in Jinro-Coors Brewing Company of Korea, as well as a $14.4-million charge related to CBC's brewery in Zaragoza, Spain, for the impairment of certain long- lived assets and goodwill and for severance costs for a limited workforce reduction. These special items amounted to a credit of $31.5 million to pretax income, or $0.37 per basic share ($0.36 per diluted share), after tax. Without this special credit, ACC would have reported net earnings of $68.3 million, or $1.84 per basic share ($1.80 per diluted share).

1996: For the 52-week fiscal year ended December 29, 1996, ACC reported net income of $43.4 million, or $1.14 per basic and diluted share. During 1996, the Company received royalties and interest from Molson in response to the October 1996 arbitration ruling that Molson had underpaid royalties from January 1, 1991, to April 1, 1993. Further, ACC recorded a gain from the 1995 curtailment of certain postretirement benefits, charges for Molson-related legal expenses and severance expenses for a limited work force reduction. These special items amounted to a pretax charge of $6.3 million, or $0.11 per basic share ($.10 per diluted share), after tax. Without this net special charge, ACC would have reported net earnings of $47.3 million, or $1.25 per basic share ($1.24 per diluted share).

1995: For the 53-week fiscal year ended December 31, 1995, ACC reported net income of $43.2 million, or $1.13 per basic and diluted share. In the fourth quarter, the Company recorded a gain from the curtailment of certain postretirement benefits and a severance charge for a limited work force reduction. These special items amounted to a pretax credit of $15.2 million, or $0.24 per basic and diluted share, after tax. ACC would have reported net income of $33.9 million, or $0.89 per basic and diluted share, without this net special credit.

Trend summary - percentage increase (decrease) for 1997, 1996 and 1995: The following table summarizes trends in operating results, excluding special items.

For th e years ended December 28, Dec ember 29, December 31, 1997 1996 1995 (In thousands, except earnings per share) Operating income: As reported $147,399 $81,019 $80,378 Excluding special items $115,882 $87,360 $65,178 Net income: As reported $ 82,260 $43,425 $43,178 Excluding special items $ 68,309 $47,299 $33,944 Earnings per share: As reported - basic $2.21 $1.14 $1.13 - diluted $2.16 $1.14 $1.13

1997 1996 1995 Volume 2.7% (1.3%) (0.3%) Net sales 4.6% 3.0% 1.0% Average base 1.7% 2.1% 1.0% price increase Gross profit 14.2% 5.2% (2.6%) Operating income 32.6% 34.0% (30.8%) Advertising 8.5% 0.5% 0.9% expense Selling, general 15.6% 13.5% 2.2%

CONSOLIDATED RESULTS OF CONTINUING OPERATIONS - 199 7 VS. 1996 AND 1996 VS. 1995 (EXCLUDING SPECIAL ITEMS)

1997 vs. 1996: Net sales increased 4.6% driven primarily by an increase in unit volume of 2.7%. This increase in net sales was also attributable to increased international sales, which generate higher revenue per barrel than domestic sales; greater revenues related to the Canadian business due to the favorable impact of the interim agreement in effect during the year with Molson Breweries and net price increases.

Gross profit in 1997 rose 14.2% to $701.4 million from 1996 due to the 4.6% increase in net sales, as discussed above, along with a 0.6% reduction in cost of goods sold. Increases in cost of goods caused by higher sales volume were offset by reduced can costs; higher income recognized from the CBC's joint ventures which produce bottles and cans; lower costs related to fixed asset write-offs; lower costs for employee benefits and less depreciation expense.

Operating income increased 32.6% to $115.9 million in 1997 as a result of the higher gross profit discussed above, offset by an 11.1% increase in marketing, general and administrative expenses. Advertising costs increased 8.5% over 1996, with increased marketing investment in premium brands and international advertising costs. General and administrative costs increased primarily due to incentive compensation; continued investment in both domestic and international sales organizations; higher costs of operating distributorships (a distributorship was acquired in mid-1997) and increases in administrative and start-up costs for certain foreign operations.

Net non-operating expenses in 1997 declined significantly from 1996 because of a 62.1% decrease in net interest expense partially offset by a 26.7% decrease in miscellaneous income. Increased cash and investment balances attributed to improved cash flow resulted in higher interest income on investments, causing the change in net interest expense. Decreased royalties earned on certain can production technologies caused the decrease in miscellaneous income.

The Company's effective tax rate decreased to 40.8% in 1997 from 41.8% in 1996 primarily due to higher tax-exempt income and foreign tax credits. The 1997 effective tax rate exceeded the statutory rate primarily because of the effects of certain foreign investments.

Net earnings for 1997 were $68.3 million, or $1.84 per basic share ($1.80 per diluted share), compared to $47.3 million, or $1.25 per basic share ($1.24 per diluted share) for 1996, representing increases of 47.2% (basic) and 45.2% (diluted) in earnings per share.

1996 vs. 1995: Even though unit volume decreased 1.3%, net sales increased 3.0% in 1996 from 1995. The decrease in unit volume was caused by a shorter fiscal year in 1996 (1996 consisted of 52 weeks versus 53 weeks in 1995). On a comparable-calendar basis, 1996 sales volume was essentially unchanged from 1995. Net sales increased in 1996 from 1995 due to price increases; lower price promotion expenses; reduced freight charges as a result of direct shipments to certain markets; increased international and export sales, which generate higher revenue per barrel than domestic sales; the impact of CBC's interim agreement with Molson Breweries, which became effective in the fourth quarter, and the slight reductions in excise taxes related to the increase in export sales. Lower Zima and Artic Ice volumes and greater proportionate Keystone volumes negatively impacted net sales per barrel in 1996.

Gross profit in 1996 rose 5.2% to $614.4 million from 1995 due to the 3.0% increase in net sales, as discussed above, offset in part by a 1.9% increase in cost of goods sold. Cost of goods sold increased due to cost increases in paper and glass packaging materials; abandonments of certain capital projects; cost increases for certain new contract- brewing arrangements and cost increases for Japanese operations, which began in the fourth quarter of 1995. The increase in cost of goods sold was partially offset by the favorable impact of decreases in brewing material costs; changes in brand mix (specifically, increases in Coors Light volume offset in part by decreases in Zima volume and increases in Keystone volume) and slightly favorable labor costs. Additionally, 1995 gross profit included the cost of the Zima Gold termination and withdrawal.

Operating income increased 34.0% to $87.4 million in 1996 from 1995 primarily due to a 5.2% increase in gross profit discussed earlier; a 6.1% decrease in research and development expenses; offset partially by a 13.5% increase in general and administrative (G&A) expenses. Marketing expenses were relatively unchanged from 1995. G&A expenses increased due to continued investments in domestic and foreign sales organizations; increases in officers' life insurance expenses; increases in costs of operating distributorships (a distributorship was acquired in 1995) and increases in administrative costs for certain foreign operations. Research and development expenses decreased due to the planned reduction in the number of capital projects in 1996.

Net non-operating expenses in 1996 declined 14.9% from 1995 because of a 47.5% increase in net miscellaneous income offset in part by a 5.4% increase in net interest expense. Increased royalties earned on certain can-decorating technologies drove the increase in miscellaneous income. Additionally, net interest expense increased due to interest incurred on the Senior Notes and reductions in the amount of interest capitalized on capital projects.

The Company's effective tax rate increased to 41.8% in 1996 from 41.6% in 1995 primarily due to changes in cash surrender values of officers' life insurance. Further, the 1996 effective tax rate exceeded the statutory rate because of the effects of certain non-deductible expenses and foreign investments.

and administrative

Net earnings for 1996 were $47.3 million, or $1.25 per basic share ($1.24 per diluted share), compared to $33.9 million, or $0.89 per basic and diluted share, for 1995, representing a 40.4% increase in basic earnings per share.

LIQUIDITY AND CAPITAL RESOURCES

The Company's primary sources of liquidity are cash provided by operating activities and external borrowings. As of December 28, 1997, ACC had working capital of $158.0 million, and its net cash position was $168.9 million compared to $110.9 million as of December 29, 1996, and $32.4 million as of December 31, 1995. In addition to its cash resources, ACC had short-term investments of $42.2 million at December 28, 1997, compared to $6.0 million at December 29, 1996. ACC also had $47.1 million of marketable investments with maturities exceeding one year at December 28, 1997, and no comparable investments at December 29, 1996. ACC had no marketable investments other than cash equivalents at December 31, 1995. The Company believes that cash flows from operations and short-term borrowings will be sufficient to meet its ongoing operating requirements; scheduled principal and interest payments on indebtedness; dividend payments; costs to make computer software Year 2000 compliant and anticipated capital expenditures in the range of $75 to $85 million for production equipment, information systems, repairs and upkeep and environmental compliance.

Operating activities: Net cash provided by operating activities was $260.6 million for 1997, $189.6 million for 1996 and $92.4 million for 1995. The increase in cash flows provided by operating activities in 1997 compared to 1996 was attributable primarily to higher net income, decreases in inventories and other assets and increases in accounts payable and accrued expenses and other liabilities, partially offset by increases in accounts and notes receivable. The decrease in inventories primarily resulted from lower levels of packaging supplies inventories on hand. The decrease in other assets is due to a reduction in other supplies. The increase in accounts payable and accrued expenses and other liabilities relative to 1996 reflects accruals for incentive compensation and increased payables for excise taxes. The increase in accounts and notes receivable reflects higher sales volumes and higher amounts due from container joint venture partners.

The 1996 increase in cash flows from operations was primarily due to decreases in inventories; moderate decreases in accounts payable and accrued expenses and other liabilities (relative to significant decreases in 1995) and decreases in accounts and notes receivable. The decrease in inventories primarily resulted from a higher proportion of shipments directly to distributors rather than shipments through to satellite redistribution centers. The moderate decreases in accounts payable and accrued expenses and other liabilities, compared to 1995, reflects the significant payment of obligations to various suppliers, including advertising agencies, in 1995. Accounts and notes receivable declined because sales were lower during the last 12 to 16 days of 1996 than during the same period of 1995. CBC's credit terms are generally 12 to 16 days.

Investing activities: During 1997, ACC spent $127.9 million on investing activities compared to $51.4 million in 1996 and $118.5 million in 1995. The 1997 increase was due primarily to ACC's investments in marketable securities with extended maturities that are not considered cash equivalents. The net of purchases over sales of these securities was $83.3 million in 1997. Capital expenditures decreased to $60.4 million in 1997 from $65.1 million in 1996 and $157.6 million in 1995. In 1997, capital expenditures focused on enhancing packaging operations, while 1996 expenditures focused on information systems and expansion of packaging capacity. In 1995, capital expenditures focused on upgrades and expansion of Golden-based facilities - particularly bottling capacity. Proceeds from property sales were $3.3 million in 1997, compared to $8.1 million in 1996 and $44.4 million in 1995. Proceeds from property sales in 1995 were unusually high because of the sale of the power plant equipment and support facilities for $22.0 million and the sale of certain bottleline machinery and equipment under a sale-leaseback transaction, for $17.0 million.

Financing activities: Net cash used in financing activities was $72.0 million during 1997 attributable to principal payments on ACC's medium- term notes of $20.5 million, net purchases of Class B common stock for $35.6 million and dividend payments of $20.5 million.

ACC spent $59.3 million on financing activities during 1996 due primarily to principal payments on its medium-term notes of $38.0 million, purchases of Class B common stock for $3.0 million and dividend payments of $19.0 million.

During 1995, the Company generated $31.0 million of cash from financing activities due to the receipt of $100 million from a private placement of Senior Notes, which was offset by principal payments on medium-term notes of $44 million, purchases of Class B common shares of $9.9 million and dividend payments of $19.1 million.

Debt obligations: As of December 28, 1997, ACC had $67.5 million outstanding in medium-term notes. With cash on hand, the Company repaid principal of $20.5 million and $38 million on these notes in 1997 and 1996, respectively. Principal payments of $44 million in 1995 were funded by a combination of cash on hand and borrowings. Fixed interest rates on these notes range from 8.63% to 9.05%. Aggregate annual maturities on outstanding notes are $27.5 million in 1998 and $40 million in 1999.

In the third quarter of 1995, ACC completed a $100-million private placement of Senior Notes at fixed interest rates ranging from 6.76% to 6.95% per annum. The repayment schedule is $80 million in 2002 and $20 million in 2005. The proceeds from this borrowing were used primarily to reduce debt under the revolving line of credit and to repay principal on the medium- term notes.

The Company's debt-to-total capitalization ratio was 19.0% in 1997, 21.2% at the end of 1996 and 24.9% at the end of 1995.

Revolving line of credit: In addition to the medium-term notes and the Senior Notes, the Company has an unsecured, committed credit arrangement totaling $200 million and as of December 28, 1997, had all $200 million available. This line of credit has a five year term which

expires in 2002, with two optional one-year extensions. A facilities fee is paid on the total amount of the committed credit. The only restriction for withdrawal is a debt-to-total-capitalization covenant, with which the Company was in compliance at year-end 1997.

CBC's distribution subsidiary in Japan has two revolving lines of credit that it uses in normal operations. Each of these facilities provides up to 500 million yen (approximately $4.0 million each) in short-term financing. As of December 28, 1997, the approximate yen equivalent of $4.5 million was outstanding under these arrangements and included in Accrued expenses and other liabilities in the consolidated balance sheets.

Hedging activities: As of December 28, 1997, hedging activities consisted exclusively of hard currency forward contracts to directly offset hard currency exposures. These irrevocable contracts reduced the risk to financial position and results of operations of changes in the underlying foreign exchange rate. Any variation in the exchange rate accruing to the contract would be offset by a similar change in the related obligation. Therefore, after execution of the contract, variations in exchange rates would not impact the Company's financial statements. ACC's hedging activities and hard currency exposures are minimal. The Company does not enter into derivative financial instruments for speculation or trading purposes.

Stock repurchase plan: On November 13, 1997, the board of directors authorized the extension of the Company's stock repurchase program through 1998. The program authorizes repurchases of up to $40 million of ACC's outstanding Class B common stock during 1998. Repurchases will be financed by funds generated from operations or possibly from short- term borrowings. The Company spent approximately $25 million in 1997 to repurchase common stock, primarily in purchasing almost 1 million shares of outstanding Class B common stock under the previously approved stock repurchase program.

Investment in Jinro-Coors Brewing Company: CBC invested approximately $22 million for a 33% interest in Jinro-Coors Brewing Company (JCBC) in 1992. CBC has accounted for this investment under the cost basis of accounting, given that CBC has not had the ability to exercise significant influence over JCBC and that CBC's investment in JCBC has been considered temporary. This investment included a put option that was exercised by CBC in December 1997. The put option entitled CBC to require Jinro Limited (the 67% owner of JCBC) to purchase CBC's investment at the greater of cost or market value (both measured in Korean Won).

Beginning in April 1997, Jinro Limited, a publicly-traded subsidiary of Jinro Group, missed debt payments and began attempting to restructure. In response to its financial difficulties and those of its subsidiaries (including JCBC), Jinro Group has been working with its creditors and the government to restructure its debts and has begun selling real estate and merging and/or selling businesses. The financial difficulties of JCBC and Jinro Limited, the guarantor of the put option discussed above, called into question the recoverability of CBC's investment in JCBC. Therefore, during the second quarter of 1997, CBC fully reserved for its investment in JCBC. This reserve was classified as a special charge in the accompanying statements of income.

CBC exercised its put option in December 1997. Since Jinro Limited's obligation under the put is measured in Korean Won and given the current significant devaluation of that currency, the full amount received from Jinro Limited would be significantly less (approximately half as of December 28, 1997) than the value of CBC's original investment. Jinro Limited, which is operating under protection from its creditors under the Korean composition law, has until June 1998 to perform its obligation under the put option. Given Jinro Limited's current financial condition and the volatility of the Korean economy, CBC cannot predict whether Jinro Limited will be able to perform under this obligation.

Cautionary Statement Pursuant to Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995

This report contains "forward-looking statements" within the meaning of the federal securities laws. These forward-looking statements include, among others, statements concerning the Company's outlook for 1998; overall and brand-specific volume trends; pricing trends and industry forces; cost reduction strategies and their results; targeted goals for return on invested capital; the Company's expectations for funding its 1998 capital expenditures and operations; the Company's expectations for funding work on computer software to make it compliant with Year 2000; and other statements of expectations, beliefs, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in or implied by the statements.

To improve its financial performance, the Company must grow premium beverage volume, achieve modest price increases for its products and reduce its overall cost structure. The most important factors that could influence the achievement of these goals -- and cause actual results to differ materially from those expressed in the forward-looking statements -- include, but are not limited to, the following:

- the inability of the Company and its distributors to develop and execute effective marketing and sales strategies for Coors products;

- the potential erosion on sales revenues through discounting or a higher proportion of sales in value-packs;

- a potential shift in consumer preferences toward lower-priced products in response to price increases;

- a potential shift in consumer preferences away from the premium light beer category, including Coors Light;

- the intensely competitive, slow-growth nature of the beer industry;

- demographic trends and social attitudes that can reduce beer sales;

- the continued growth in the popularity of imports and other specialty beers;

- increases in the cost of aluminum, paper packaging and other raw materials;

- the Company's inability to reduce manufacturing, freight and overhead costs to more competitive levels;

- changes in significant laws and government regulations affecting environmental compliance and income taxes;

- inability to achieve targeted improvements in CBC's distribution system;

- the imposition of excise or other taxes;

- restrictions on advertising (e.g., media, outdoor ads or sponsorships);

- labor issues, including union activities that required a substantial increase in cost of goods sold or led to a strike, impairing production and decreasing sales;

- significant increases in federal, state or local beer or other excise taxes;

- increases in rail transportation rates or interruptions of rail service;

- potential impact of industry consolidation;

- risks associated with investments and operations in foreign countries, including those related to foreign regulatory requirements; exchange rate fluctuations and local political, social and economic factors; and

- risk that computer systems of the Company's significant suppliers and customers may not be Year 2000 compliant.

These and other risks and uncertainties affecting the Company are discussed in greater detail in this report and in the Company's other filings with the Securities and Exchange Commission.

OUTLOOK FOR 1998

Volume gains are expected to increase net sales in 1998; however, the pricing environment is expected to be extremely competitive, restraining expectations of net sales per barrel. Also, increased value-pack activity may have an unfavorable impact on top-line performance due to lower margins.

Income from the Company's Canadian business is expected to be 25% to 30% lower per barrel in 1998 than in 1997, based on current sales trends and 1998 plans for marketing investments. Revenue received under the Company's interim agreement with Molson Breweries, which expired at year-end 1997, provided higher earnings per barrel than those expected as a result of the new partnership with Molson Company and Carling. On the other hand, the partners of Coors Canada see considerable growth potential for Coors products in Canada in the future.

For fiscal year 1998, raw material costs are expected to be up slightly, but fixed costs and freight costs are expected to be down slightly. This outlook could change if aluminum or paper cost trends change during the first nine months of 1998. CBC continues to pursue improvements in its operations and technology functions to achieve cost reductions over time.

Advertising and other general and administrative costs are expected to increase but at a lower rate than in 1997. Management continues to monitor CBC's market opportunities and to invest behind its brands and sales efforts accordingly. Incremental sales and marketing spending will be determined on an opportunity-by-opportunity basis.

See the item titled Year 2000 under CONTINGENCIES of this section for a discussion of the expected financial impact of this issue.

Total net interest expense is expected to be lower in 1998 based on CBC's more favorable cash position and its lower outstanding debt relative to its 1997 financial position. Net interest expense could be less favorable than expected if the Company decides to invest a substantial portion of its cash balances. Additional outstanding common stock may be repurchased in 1998 as approved by the ACC board of directors in November 1997.

The effective tax rate for 1998 is not expected to differ significantly from the 1997 effective tax rate applied to income excluding special items. The level and mix of pretax income for 1998 could affect the actual rate for the year.

In 1998, CBC has planned capital expenditures (including contributions to its container joint ventures for capital improvements, which will be recorded on the books of the joint venture) in the range of $75 to $85 million. In addition to CBC's 1998 planned capital expenditures, incremental strategic investments will be considered on a case-by-case basis.

CONTINGENCIES

Environmental: The Company was one of numerous parties named by the Environmental Protection Agency (EPA) as a "potentially responsible party" (PRP) for the Lowry site, a legally permitted landfill owned by the City and County of Denver. In 1990, the Company recorded a special pretax charge of $30 million for potential cleanup costs of the site.

The City and County of Denver; Waste Management of Colorado, Inc. and Chemical Waste Management, Inc. brought litigation in 1991 in U.S. District Court against the Company and 37 other PRPs to determine the allocation of costs of Lowry site remediation. In 1993, the Court approved a settlement agreement between the Company and the plaintiffs, resolving the Company's liabilities for the site. The Company agreed to initial payments based on an assumed present value of $120 million in total site remediation costs. Further, the Company agreed to pay a specified share of costs if total remediation costs exceeded this amount. The Company remitted its agreed share of $30 million, based on the $120 million assumption, to a trust for payment of site remediation, operating and maintenance costs.

The City and County of Denver; Waste Management of Colorado, Inc. and Chemical Waste Management, Inc. are expected to implement site remediation. The EPA's projected costs to meet the announced remediation objectives and requirements are currently below the $120 million assumption used for ACC's settlement. The Company has no reason to believe that total remediation costs will result in additional liability to the Company.

From time to time, ACC also is notified that it is or may be a PRP under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) or similar state laws for the cleanup of other sites where hazardous substances have allegedly been released into the environment. The Company cannot predict with certainty the total costs of cleanup, its share of the total cost or the extent to which contributions will be available from other parties, the amount of time necessary to complete the cleanups or insurance coverage. However, based on investigations to date, the Company believes that any liability would be immaterial to its financial position and results of operations for these sites. There can be no certainty, however, that the Company will not be named as a PRP at additional CERCLA sites in the future, or that the costs associated with those additional sites will not be material.

While it is impossible to predict the Company's eventual aggregate cost for environmental and related matters, management believes that any payments, if required, for these matters would be made over a period of time in amounts that would not be material in any one year to the Company's results of operations or its financial or competitive position. The Company believes adequate disclosures have been provided for losses that are reasonably possible. Further, as the Company continues to focus on resource conservation, waste reduction and pollution prevention, it believes that potential future liabilities will be reduced.

Year 2000: As the Year 2000 approaches, ACC recognizes the need to ensure its operations will not be adversely impacted by Year 2000 software failures. The Company is addressing this issue to ensure the availability and integrity of its financial systems and the reliability of its operational systems. ACC has established processes for evaluating and managing the risks and costs associated with this problem. The Company has and will continue to make certain investments in its software systems and applications to ensure that it is Year 2000 compliant. The financial impact to ACC of Year 2000 remediation costs is anticipated to be in the range of $10 to $15 million in each of 1998 and 1999. In addition, ACC is working with its suppliers and customers to ensure their compliance with Year 2000 issues in order to avoid any interruptions in its business. While ACC does not at this time anticipate significant problems with suppliers and customers, it is developing contingency plans with these third parties due to the possibility of compliance issues.

ACCOUNTING CHANGES

In March 1998, the Accounting Standards Executive Committee issued Statement of Position 98-1 "Accounting for the Costs of Computer Software Developed or Obtained for Internal Use" (SOP 98-1). SOP 98-1 requires that specified costs incurred in developing or obtaining internal-use software, as defined by SOP 98-1, be capitalized once certain criteria have been met and amortized in a systematic and rational manner over the software's estimated useful life. SOP 98-1 is effective for fiscal years beginning after December 15, 1998, and stipulates that costs incurred prior to initial application of the statement not be adjusted according to the statement's provisions. Adoption of SOP 98-1 is not expected to have a significant impact on the Company's financial position or results of operations.

ITEM 8. Financial Statements and Supplementary Data Index to Financial Statements Page(s) Consolidated Financial Statements: Report of Independent Accountants 27 Consolidated Statements of Income for eac h of the three years in the period ended Dec ember 28, 1997 28 Consolidated Balance Sheets at December 2 8, 1997 and December 29, 1996 29-30

position of Adolph Coors Company and its subsidiaries at December 28, 1997, and December 29, 1996, and the results of their operations and their cash flows for each of the three years in the period ended December 28, 1997, in conformity with generally accepted accounting principles. These financial statements are the responsibility of the Company's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with generally accepted auditing standards which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for the opinion expressed above.

PRICE WATERHOUSE LLP

Denver, Colorado February 12, 1998

ADOLPH COORS COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME

See notes to consolidated financial statements.

ADOLPH COORS COMPANY AND SUBSIDIARIES

Consolidated Statements of Cash Flows for each of the three years in the period ended Dec ember 28, 1997 31 Consolidated Statements of Shareholders' Equity for each of the three years in the peri od ended December 28, 1997 32 Notes to Consolidated Financial Statement s 33-51 Report of Independent Accountant s To the Board of Directors and Shareholders of Adolp h Coors Company: In our opinion, the accompanying consolidated balan ce sheets and related consolidated statements of income, sharehol ders' equity and cash flows present fairly, in all material respects , the financial

For the years ended December 28, December 29, December 31, 1997 1996 1995 (In thousand s, except per share data) Sales - domestic and international $2,208,231 $2,121,367 $2,075,917 Less: beer excise taxes (386,080) (379,311) (385,216) Net sales 1,822,151 1,742,056 1,690,701 Costs and expenses: Cost of goods sold 1,120,778 1,127,689 1,106,635 Marketing, general and administrative 585,491 527,007 518,888 Special (credits) charges (Note 9) (31,517) 6,341 (15,200) Total operating expenses 1,674,752 1,661,037 1,610,323 Operating income 147,399 81,019 80,378 Other income (expense): Interest income 9,360 2,821 1,345 Interest expense (13,560) (13,907) (11,863) Miscellaneous - net 3,694 5,042 3,418 Total (506) (6,044) (7,100) Income before income taxes 146,893 74,975 73,278 Income tax expense (Note 5) (64,633) (31,550) (30,100) Net income $ 82,260 $ 43,425 $ 43,178 Net income per common share - basic $ 2.21 $ 1.14 $ 1.13 Net income per common share - diluted $ 2.16 $ 1.14 $ 1.13 Weighted average number of outstanding common shares - basic 37,218 37,966 38,164 Weighted average number of outstanding common shares - diluted 38,056 38,219 38,283

CONSOLIDATED BALANCE SHEETS

D ecember 28, December 29, 1997 1996 (In thousands) Assets Current assets: Cash and cash equivalents $ 168,875 $ 110,905 Short-term investments 42,163 5,958 Accounts and notes receivable: Trade, less allowance for doubtful accounts of $557 in 1997 and $275 in 1996 89,731 86,421 Affiliates 19,677 14,086 Other, less allowance for certain claims of $1,500 in 1997 and $0 in 1996 15,077 13,836 Inventories: Finished 44,729 43,477 In process 20,119 23,157 Raw materials 35,654 40,737 Packaging materials, less allowance for obsolete inventories of $1,049 in 1997 and $1,046 in 1996 5,977 13,699 106,479 121,070 Other supplies, less allowance for obsolete supplies of $4,165 in 1997 and $2,273 in 1996 32,362 36,103 Prepaid expenses and other assets 18,224 18,836 Deferred tax asset (Note 5) 24,606 9,427 Total current assets 517,194 416,642 Properties, at cost and net (Note 2) 733,117 814,102 Excess of cost over net assets of businesses acquired, less accumulated amortization of $5,726 in 1997 and $4,778 in 1996 22,880 21,374 Other assets (Note 10) 138,892 110,418 Total assets $1,412,083 $1,362,536 December 28, December 29, 1997 1996 Liabilities and Shareholders' Equity (In thousands) Current liabilities: Current portion of long-term debt (Note 4) $ 27,500 $ 17,000 Accounts payable: Trade 113,864 110,696 Affiliates 18,072 12,424 Accrued salaries and vacations 58,257 39,482 Taxes, other than income taxes 52,805 30,976 Federal and state income taxes (Note 5) 13,660 8,983 Accrued expenses and other liabilities 74,988 72,887 Total current liabilities 359,146 292,448 Long-term debt (Note 4) 145,000 176,000 Deferred tax liability (Note 5) 76,219 76,083 Postretirement benefits (Note 8) 71,908 69,773 Other long-term liabilities 23,242 32,745 Total liabilities 675,515 647,049 Commitments and contingencies (Notes 3, 4, 5, 6, 7, 8, 10 and 12) Shareholders' equity (Notes 6 and 11): Capital stock: Preferred stock, non-voting, $1 par value (authorized: 25,000,000 shares; issued: non e) -- -- Class A common stock, voting, $1 par value, (authorized and issued: 1,260,000 shares) 1,260 1,260 Class B common stock, non-voting, no par value, $0.24 stated value (authorized: 100,000,000 shares; issued: 35,599,356 in 1997 and

Total liabilities and shareholders' equity $1,412,083 $1,362,536

See notes to consolidated financial statements.

ADOLPH COORS COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS

Balance at end of year $ 168,875 $ 110,905 $ 32,386

See notes to consolidated financial statements.

36,662,404 in 1996) 8,476 8,729 Total capital stock 9,736 9,989 Paid-in capital -- 31,436 Retained earnings 730,628 671,972 Foreign currency translation adjustment (3,796) 2,090 Total shareholders' equity 736,568 715,487

For the years ended December 28 , December 29, December 31, 1997 1996 1995 Cash flows from operating activities: (In thousands) Net income $ 82,260 $ 43,425 $ 43,178 Adjustments to reconcile net income to net cash provided by operating activities: Equity in net earnings of joint ventures (15,893 ) (11,467) (13,687) Reserve for joint venture investment 21,978 -- -- Depreciation, depletion and amortization 117,166 121,121 122,830 Loss on sale or abandonment of properties and intangibles 5,594 12,535 1,274 Impairment charge 10,595 -- -- Deferred income taxes (15,043 ) 17,696 3,610 Change in operating assets and liabilities: Accounts and notes receivable (10,971 ) 2,232 (9,952) Inventories 14,051 18,076 2,135 Other assets 3,742 (2,128) (655) Accounts payable 9,599 (8,175) (32,180) Accrued expenses and other liabilities 37,475 (3,712) (24,139) Net cash provided by operating activities 260,553 189,603 92,414 Cash flows from investing activities: Purchases of investments (122,800 ) (5,958) -- Sales and maturities of investments 39,499 -- -- Additions to properties and intangible assets (60,373 ) (65,112) (157,599) Proceeds from sale of properties and intangibles 3,273 8,098 44,448 Distributions from joint ventures 12,500 5,000 -- Other (25 ) 6,569 (5,338) Net cash used in investing activities (127,926 ) (51,403) (118,489) Cash flows from financing activities: Issuance of stock under stock plans 24,588 4,674 4,117 Purchases of stock (60,151 ) (6,975) (9,936) Dividends paid (20,523 ) (18,983) (19,066) Proceeds from long-term debt -- -- 100,000 Payments of long-term debt (20,500 ) (38,000) (44,000) Other 4,544 -- (116) Net cash (used in) provided by financing activities (72,042 ) (59,284) 30,999 Cash and cash equivalents: Net increase in cash and cash equivalents 60,585 78,916 4,924 Effect of exchange rate changes on cash and cash equivalents (2,615 ) (397) 294 Balance at beginning of year 110,905 32,386 27,168

ADOLPH COORS COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

See notes to consolidated financial statements.

ADOLPH COORS COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1:

Summary of Significant Accounting Policies

Principles of consolidation: The consolidated financial statements include the accounts of Adolph Coors Company (ACC), its principal subsidiary, Coors Brewing Company (CBC), and the majority-owned and controlled domestic and foreign subsidiaries of both ACC and CBC (collectively referred to as "the Company"). All significant intercompany accounts and transactions have been eliminated. The equity method of accounting is used for the Company's 50% or less owned affiliates over which the Company has the ability to exercise significant influence (see Note 10). The Company has other investments which are accounted for at cost.

Nature of operations: The Company is a multinational brewer and marketer of beer and other malt-based beverages. The vast majority of the Company's volume is sold in the United States to independent wholesalers. The Company's international volume is produced, marketed and distributed under varying business arrangements including export, direct investment, joint ventures and licensing.

Fiscal year: The fiscal year of the Company is a 52- or 53-week period ending on the last Sunday in December. Fiscal years for the financial statements included herein ended December 28, 1997, a 52-week period; December 29, 1996, a 52-week period and December 31, 1995, a 53-week period.

Investments in marketable securities: ACC invests excess cash on hand in interest-bearing debt securities. At December 28, 1997, $42.2 million of these securities were classified as current assets and $47.1 million were classified with longer term assets, as their maturities exceeded one year. All of these securities were considered to be available-for-sale. The fair value of these securities at December 28, 1997, approximated their amortized cost.

Concentration of credit risk: The majority of the accounts receivable balances are from malt beverage distributors. The Company secures substantially all of this credit risk with purchase money security interests in inventory and proceeds, personal guarantees and/or letters of credit.

Inventories: Inventories are stated at the lower of cost or market. Cost is determined by the last-in, first-out (LIFO) method for substantially all inventories.

Current cost, as determined principally on the first-in, first- out method, exceeded LIFO cost by $43.4 million and $43.1 million at December 28, 1997, and December 29, 1996, respectively.

Foreign Common stock currency issued Paid-in Retained translation Class A Class B capital earnings adjustment Total (In thousands, e xcept per share data) Balances, December 25, 1994 $ 1,260 $ 8,825 $39,460 $623,418 $1,238 $674,201 Shares issued under stock plans 59 4,058 4,117 Purchase of stock (137) (9,799 ) (9,936) Other 2,522 2,522 Net income 43,178 43,178 Cash dividends-$0.50 per share (19,066) (19,066) Balances, December 31, 1995 1,260 8,747 33,719 647,530 3,760 695,016 Shares issued under stock plans 61 4,613 4,674 Purchase of stock (79) (6,896 ) (6,975) Other (1,670) (1,670) Net income 43,425 43,425 Cash dividends-$0.50 per share (18,983) (18,983) Balances, December 29, 1996 1,260 8,729 31,436 671,972 2,090 715,487 Shares issued under stock plans 236 25,145 25,381 Purchase of stock (489)(56,581 ) (3,081) (60,151) Other (5,886) (5,886) Net income 82,260 82,260 Cash dividends-$0.55 per share (20,523) (20,523) Balances, December 28, 1997 $ 1,260 $ 8,476 $ -- $730,628 $(3,796) $736,568

Properties: Land, buildings and equipment are stated at cost. Depreciation is provided principally on the straight-line method over the following estimated useful lives: buildings and improvements, 10 to 45 years; and machinery and equipment, 3 to 20 years. Accelerated depreciation methods are generally used for income tax purposes. Expenditures for new facilities and improvements that substantially extend the capacity or useful life of an asset are capitalized. Start-up costs associated with manufacturing facilities, but not related to construction, are expensed as incurred. Ordinary repairs and maintenance are expensed as incurred.

Hedging transactions: The Company periodically enters into short- term forward contracts for foreign currency to hedge its exposure to exchange rate fluctuations. The gains and losses on these contracts are deferred and recognized in income when realized.

As of December 28, 1997, hedging activities consisted exclusively of hard currency forward contracts to directly offset hard currency exposures. These irrevocable contracts reduced the risk to financial position and results of operations of changes in the underlying foreign exchange rate. Any variation in the exchange rate accruing to the contract would be offset by a similar change in the related obligation. Therefore, after the execution of the contract, variations in exchange rates would not impact the Company's financial statements. The Company's hedging activities and hard currency exposures are minimal. The Company does not enter into derivative financial instruments for speculation or trading purposes.

Excess of cost over net assets of businesses acquired: The excess of cost over the net assets of businesses acquired in transactions accounted for as purchases is being amortized on a straight-line basis, generally over a 40-year period.

Impairment policy: The Company periodically evaluates its assets to assess their recoverability from future operations using undiscounted cash flows. Impairment would be recognized in operations if permanent diminution in value occurs.

Advertising: Advertising costs, included in marketing, general and administrative, are expensed when the advertising first takes place. Advertising expense was $360.0 million, $331.9 million and $330.4 million for years 1997, 1996 and 1995, respectively. The Company had $9.6 million and $10.9 million of prepaid advertising production costs reported as assets at December 28, 1997, and December 29, 1996, respectively.

Research and development: Research and project development costs, included in marketing, general and administrative, are expensed as incurred. These costs totaled $14.6 million, $15.3 million and $16.3 million in 1997, 1996 and 1995, respectively.

Environmental expenditures: Environmental expenditures that relate to current operations are expensed or capitalized, as appropriate. Expenditures that relate to an existing condition caused by past operations, which do not contribute to current or future revenue generation, are expensed. Liabilities are recorded when environmental assessments and/or remedial efforts are probable and the costs can be estimated reasonably.

Statement of Cash Flows: The Company defines cash equivalents as highly liquid investments with original maturities of 90 days or less. The fair value of these investments approximates their carrying value. The Company's 1995 investment in the Rocky Mountain Bottle Company was a $16.2 million non-cash transaction that is not reflected as an investing activity in the Statement of Cash Flows. During 1997, ACC issued $0.8 million in restricted common stock under its management incentive compensation plan. Income taxes paid were $66.8 million in 1997, $13.2 million in 1996 and $15.8 million in 1995.

Use of estimates: The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Reclassifications: Certain reclassifications have been made to the 1996 and 1995 financial statements to conform with the 1997 presentation.

NOTE 2:

Properties

The cost of properties and related accumulated depreciation, depletion and amortization consists of the following:

As of December 28, December 29, 1997 1996 (In thous ands) Land and improvements $ 97,117 $ 98,666 Buildings 482,939 477,184 Machinery and equipment 1,516,034 1,511,665 Natural resource properties 8,906 10,423

In March 1994, CBC, through its subsidiary Coors Brewing Iberica, S.A. (Coors Iberica), purchased a 500,000-hectoliter brewery in Zaragoza, Spain. During 1997, Coors Iberica addressed certain capacity issues at its brewery, as well as certain employment matters. Coors Iberica negotiated severance terms with labor unions during the second quarter of 1997, which prompted CBC management to update its evaluation of the recoverability of Coors Iberica's long-lived assets and related goodwill. Certain of these assets were deemed impaired in light of expected future, undiscounted cash flows. During the second quarter of 1997, CBC recorded an impairment charge of approximately $10.6 million and severance costs of approximately $3.8 million, which have been classified as special charges in the accompanying statements of income. The impairment charge represented a reduction of the carrying amounts of the impaired assets to their estimated fair market values, which were determined with the aid of an independent, third-party appraisal.

Interest incurred, capitalized, expensed and paid was as follows:

NOTE 3:

Leases

The Company leases certain office facilities and operating equipment under cancelable and non-cancelable agreements accounted for as operating leases. At December 28, 1997, the minimum aggregate rental commitment under all non-cancelable leases was (in thousands): 1998, $5,403; 1999, $4,578; 2000, $3,124; 2001, $2,353 and $15,021 for years thereafter. Total rent expense was (in thousands) $13,870, $11,680 and $10,376 for years 1997, 1996 and 1995, respectively.

NOTE 4:

Debt

Long-term debt consists of the following:

Fair values were determined using discounted cash flows at current interest rates for similar borrowings.

As of December 28, 1997, the Company had outstanding $67.5 million of unsecured medium-term notes. Interest is due semiannually in April and October at fixed interest rates ranging from 8.63% to 9.05% per annum. Aggregate annual maturities for the notes issued are $27.5 million in 1998 and $40 million in 1999.

On July 14, 1995, the Company completed a $100-million private placement of unsecured Senior Notes at fixed interest rates ranging from 6.76% to 6.95% per annum. Interest on the notes is due semiannually in January and July. The Notes are payable as follows: $80 million in

Construction in progress 39,941 29,873 2,144,937 2,127,811 Less accumulated depreciation, depletion and amortization (1,411,820) (1,313,709) Net properties $ 733,117 $ 814,102

For the years en ded December 28, December 29, December 31, 1997 1996 1995 (In thousands ) Interest costs $15,460 $17,057 $18,433 Interest capitalized (1,900) (3,150) (6,570) Interest expensed $13,560 $13,907 $11,863 Interest paid $14,643 $17,711 $16,613

As of December 28, 1997 December 29, 1996 Carrying Fair Carrying Fair value value value value (In th ousands) Medium-term notes $ 67,500 $ 70,000 $ 88,000 $ 94,000 Senior Notes 100,000 101,000 100,000 101,000 Industrial development bonds 5,000 5,000 5,000 5,000 Total 172,500 176,000 193,000 200,000 Less current portion (27,500) (27,500) (17,000) (17,000) $145,000 $148,500 $176,000 $183,000

2002 and $20 million in 2005.

The Company is obligated to pay the principal, interest and premium, if any, on the $5 million, City of Wheat Ridge, Colorado Industrial Development Bonds (Adolph Coors Company Project) Series 1993. The bonds mature in 2013 and are secured by a letter of credit. They are currently variable rate securities with interest payable on the first of March, June, September and December. The interest rate on December 28, 1997 was 4.3%.

The Company has an unsecured, committed credit arrangement totaling $200 million and as of December 28, 1997, had all $200 million available. This line of credit has a five year term which expires in 2002, with two optional one-year extensions. A facilities fee is paid on the total amount of the committed credit. The only restriction for withdrawal is a debt-to-total-capitalization covenant, with which the Company was in compliance at year-end 1997.

CBC's distribution subsidiary in Japan has two revolving lines of credit that it utilizes in its normal operations. Each of these facilities provides up to 500 million yen (approximately $4.0 million each) in short-term financing. As of December 28, 1997, the approximate yen equivalent of $4.5 million was outstanding under these arrangements and included in Accrued expenses and other liabilities in the accompanying balance sheets.

NOTE 5:

Income Taxes

Income tax expense (benefit) includes the following current and deferred provisions:

The Company's income tax expense varies from the amount expected by applying the statutory federal corporate tax rate to income as follows:

The Company's deferred taxes are composed of the following:

For the y ears ended December 28, Decem ber 29, December 31, 1997 1996 1995 (In th ousands) Current: Federal $ 68,435 $ 8,878 $ 24,275 State and foreign 11,241 4,976 2,215 Total current tax expense 79,676 13,854 26,490 Deferred: Federal (12,935) 12,154 6,062 State and foreign (2,108) 5,542 (2,452) Total deferred tax (benefit) expense (15,043) 17,696 3,610 Total income tax expense $ 64,633 $ 31,550 $ 30,100

For the years ended December 28, Dec ember 29, December 31, 1997 1996 1995 Expected tax rate 35.0% 35.0% 35.0% State income taxes, net of federal benefit 3.9 4.3 4.7 Effect of foreign investments 0.8 1.6 0.6 (Non-taxable income) non-deductible expenses and losses (0.4) 1.9 0.8 Effect of reserve for joint venture investment 4.8 -- -- Other, net (0.1) (0.8) -- Effective tax rate 44.0% 42.0% 41.1%

As of Decemb er 28, December 29, 1997 1996 Current deferred tax assets: (In thousands) Deferred compensation and other employee related $ 1 1,773 $ 11,865 Balance sheet reserves and accruals 1 8,560 9,051 Other 1,560 2,054 Valuation allowance ( 7,002) -- Total current deferred tax assets 2 4,891 22,970

The deferred tax assets have been reduced by a valuation allowance, because management believes it is more likely than not that such benefits will not be fully realized.

The Internal Revenue Service (IRS) has completed its examination of the Company's federal income tax returns through 1992. The IRS currently is examining the federal income tax returns for fiscal years 1993 through 1995. In the opinion of management, adequate accruals have been provided for all income tax matters and related interest.

The Company and ACX Technologies, Inc. (ACX) are parties to a tax sharing agreement that provides for, among other things, the treatment of tax matters for periods prior to the distribution of ACX stock at the end of 1992 and the assignment of responsibility for adjustments as a result of audits by taxing authorities and is designed to preserve the status of the distribution as tax-free (see Note 12).

NOTE 6:

Stock Option, Restricted Stock Award and Employee Award Plans

At December 28, 1997, the Company had four stock-based compensation plans, which are described in greater detail below. The Company applies APB Opinion No. 25 and related interpretations in accounting for its plans. Accordingly, as the exercise prices upon grant are equal to quoted market values, no compensation cost has been recognized for the stock option portion of the plans. Had compensation cost been determined for the Company's stock option portion of the plans based on the fair value at the grant dates for awards under those plans consistent with the alternative method set forth under FASB Statement No. 123, the Company's net income and earnings per share would have been reduced to the pro forma amounts indicated below:

The weighted-average fair value of options granted under the 1990 Equity Incentive Plan during the year is: $ 8.78 $ 7.21 $ 6.21

The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions used for grants in 1997 and 1996, respectively: dividend yield of 2.47% and 2.535%; expected volatility of 36.06% and 26.7%, risk-free interest rates of 6.52% and 5.74% for the 1990 Plan options and expected lives of 10 years for both years.

1983 Plan: The 1983 non-qualified Adolph Coors Company Stock Option Plan, as amended (the 1983 Plan) provides for options to be granted at the discretion of the board of directors. These options expire 10 years from date of grant. No options have been granted under this plan since 1989. At this time, the board of directors has decided not to grant additional options under this plan.

Current deferred tax liabilities: Balance sheet reserves and accruals 285 4,545 Other -- 8,998 Total current deferred tax liabilities 285 13,543 Net current deferred tax assets $ 2 4,606 $ 9,427 Non-current deferred tax assets: Deferred compensation and other employee related $ 2,999 $ 7,077 Balance sheet reserves and accruals 2,784 9,006 Other employee postretirement benefits 2 8,158 27,724 Environmental accruals 1,469 2,308 Deferred foreign losses 2,142 -- Other 1,583 3,403 Total non-current deferred tax assets 3 9,135 49,518 Non-current deferred tax liabilities: Depreciation and capitalized interest 11 5,226 123,855 Other 128 1,746 Total non-current deferred tax liabilities 11 5,354 125,601 Net non-current deferred tax liabilities $ 7 6,219 $ 76,083

199 7 1996 1995 (I n thousands, except per share data) Net income As reported $ 82, 260 $ 43,425 $ 43,178 Pro forma $ 78, 077 $ 42,793 $ 41,799 Net income per common share- As reported $ 2 .21 $ 1.14 $ 1.13 basic Pro forma $ 2 .10 $ 1.13 $ 1.09 Net income per common share- As reported $ 2 .16 $ 1.14 $ 1.13 diluted Pro forma $ 2 .05 $ 1.12 $ 1.09

A summary of the status of the Company's 1983 Plan as of December 28, 1997, December 29, 1996, and December 31, 1995, and changes during the years ending on those dates is presented below:

Common stock available for options under the 1983 Plan as of December 28, 1997, December 29, 1996, and December 31, 1995 was 716,886 shares, 712,998 shares and 694,090 shares, respectively.

1990 Plan: The 1990 Equity Incentive Plan (1990 EI Plan) that became effective January 1, 1990, as amended, provides for two types of grants: stock options and restricted stock awards. The stock options have a term of 10 years with exercise prices equal to fair market value on the day of the grant. For grants during 1997, one-third of the stock option grant vests in each of the three successive years after the date of grant. For grants during 1994 through 1996, stock options vested at 10% for each $1 increase in fair market value of ACC stock from date of grant, with a one-year holding period, or vest 100% after nine years. Once a portion has vested, it is not forfeited even if the fair market value drops.

A summary of the status of the Company's 1990 EI Plan as of December 28, 1997, December 29, 1996, and December 31, 1995, and changes during the years ending on those dates is presented below:

Common stock available for options under the 1990 EI Plan as of December 28, 1997, December 29, 1996, and December 31, 1995 was 4,675,195 shares, 3,105,844 shares and 3,650,483 shares, respectively.

In 1997, 40,201 shares of restricted stock were issued under the 1990 EI Plan. Vesting in the restricted stock award is one year from the date of grant. The compensation cost associated with these awards was immaterial.

In 1996, 45,390 shares of restricted stock were issued under the 1990 EI Plan. Vesting in the restricted stock awards is over a three-year period from the date of grant. The compensation cost associated with these awards is amortized to expense over the vesting period. Compensation cost associated with these awards was immaterial in 1997 and 1996.

1991 Plan: In 1991, the Company adopted the Equity Compensation Plan for Non-Employee Directors (EC Plan). The EC Plan provides for two grants of the Company's stock: the first grant is automatic and equals 20% of the director's annual retainer, and the second grant is elective and covers all or any portion of the balance of the retainer. A director may elect to receive his remaining 80% retainer in cash, restricted stock or any combination of the two. Grants of stock vest after completion of the director's annual term. The compensation cost associated with the EC Plan is amortized over the director's term. Compensation cost associated with this plan was immaterial in 1997 and 1996. Common stock reserved for this plan as of December 28, 1997, was 47,810 shares.

1995 Supplemental Compensation Plan: In 1995, the Company adopted a supplemental compensation plan that covers substantially all its

Options exercisable at year end Weigh ted- Weighted- aver age average exerc ise exercise Shares pri ce Shares price Outstanding at December 25, 1994 411,101 $1 5.92 411,101 $15.92 Exercised 228,636 1 5.24 Forfeited 13,811 1 8.02 Outstanding at December 31, 1995 168,654 1 6.66 168,654 16.66 Exercised 100,231 1 6.54 Forfeited 18,908 2 1.97 Outstanding at December 29, 1996 49,515 1 4.85 49,515 14.85 Exercised 45,627 1 4.55 Forfeited 3,888 1 8.36 Outstanding at December 28, 1997 -- N/A -- N/A

Options exercisable at year end Weigh ted- Weighted- aver age average exerc ise exercise Shares pri ce Shares price Outstanding at December 25, 1994 775,248 $1 6.02 232,635 $15.44 Granted 600,561 1 6.75 Exercised 25,190 1 4.98 Forfeited 64,567 1 6.57 Outstanding at December 31, 1995 1,286,052 1 6.35 512,708 15.95 Granted 614,674 2 1.27 Exercised 107,327 1 6.26 Forfeited 70,035 1 8.84 Outstanding at December 29, 1996 1,723,364 1 8.01 846,273 16.30 Granted 1,573,742 2 0.23 Exercised 901,834 1 7.71 Forfeited 143,093 1 9.21 Outstanding at December 28, 1997 2,252,179 1 9.61 769,202 18.25

employees. Under the plan, management is allowed to recognize employee achievements through awards of Coors Stock Units (CSUs) or cash. CSUs are a measurement component equal to the fair market value of the Company's Class B common stock. CSUs have a one-year holding period after which the recipient may redeem the CSUs for cash, or, if the holder has 100 or more CSUs, shares of the Company's Class B common stock. Prior to 1997, the CSUs had a six-month holding period. Awards under the plan in 1997 and 1996 were immaterial.

Common stock available under this plan as of December 28, 1997, was 83,707 shares.

NOTE 7:

Employee Retirement Plans

The Company maintains several defined benefit pension plans for the majority of its employees. Benefits are based on years of service and average base compensation levels over a period of years. Plan assets consist primarily of equity, interest-bearing investments and real estate. The Company's funding policy is to contribute annually not less than the ERISA minimum funding standards, nor more than the maximum amount that can be deducted for federal income tax purposes. Total expense for all these plans was $14.1 million in 1997, $24.8 million in 1996 and $22.7 million in 1995. These amounts include the Company's matching for the savings and investment (thrift) plan of $5.8 million in 1997 and $5.7 million each for 1996 and 1995. The decrease in 1997 pension expense versus 1996 was caused primarily by an improvement in the funded position of the Coors Retirement Plan and an increase in the discount rate (settlement rate) used to compute 1997 pension cost to 7.75% from the rate used for 1996 pension cost of 7.25%. The increase in 1996 pension expense versus 1995 was caused primarily by a decrease in the 1996 discount rate (settlement rate) to 7.25% from the 1995 rate of 8.5%.

Note that the settlement rates shown in the table on the following page were selected for use at the end of each of the years shown. Actuaries calculate pension expense annually based on data available at the beginning of each year, which includes the settlement rate selected and disclosed at the end of the previous year.

The funded status of the pension plans and amounts recognized in the accompanying balance sheets are as follows:

Significant assumptions used in determining the valuation of the projected benefit obligations as of the end of 1997, 1996 and 1995 were:

For the years ended December 28, Dec ember 29, December 31, 1997 1996 1995 (In thousands) Service cost-benefits earned during the year $ 11,234 $ 12,729 $ 9,858 Interest cost on projected benefit obligations 32,730 31,162 29,285 Actual gain on plan assets (75,242) (65,504) (69,346) Net amortization and deferral 39,539 40,691 47,005 Net pension cost $ 8,261 $ 19,078 $ 16,802

As of D ecember 28, December 29, 1997 1996 (In thousands) Actuarial present value of accumulated plan benefit s, including vested benefits of $368,288 in 1997 and $332,444 in 1996 $385,989 $350,506 Projected benefit obligations for services rendered to date $465,229 $422,516 Plan assets available for benefits 465,494 394,206 Plan assets (more than) less than projected benefit obligations (265) 28,310 Unrecognized net gain 21,560 2,359 Prior service cost not yet recognized (16,577) (18,851) Unrecognized net assets being recognized over 15 years 4,110 5,800 Net accrued pension liability $ 8,828 $ 17,618

19 97 1996 1995

NOTE 8:

Non-Pension Postretirement Benefits

The Company has postretirement plans that provide medical benefits and life insurance for retirees and eligible dependents. The plans are not funded.

The obligation under these plans was determined by the application of the terms of medical and life insurance plans, together with relevant actuarial assumptions and health care cost trend rates ranging ratably from 9.0% in 1997 to 4.5% in the year 2007. The effect of an annual 1% increase in trend rates would increase the accumulated postretirement benefit obligation by approximately $3.5 million and $3.2 million in 1997 and 1996, respectively. The effect of a 1% increase in trend rates also would have increased the ongoing annual cost by $0.5 million and $0.6 million in 1997 and 1996, respectively. The discount rate used in determining the accumulated postretirement benefit obligation was 7.25% and 7.75% at December 28, 1997, and December 29, 1996, respectively.

Net periodic postretirement benefit cost included the following:

Net periodic postretirement benefit cost $ 5,830 $ 6,837 $ 8,147

Effective November 29, 1995, changes were made to postretirement life insurance and medical benefits which resulted in a curtailment gain of $3.3 million and $18.6 million in 1996 and 1995, respectively. The 1996 decrease in plan expense resulted principally from the curtailment of these benefits. The 1997 decrease in expense was a result of an increase in the discount rate used to 7.75% in 1997 from 7.25% in 1996.

The status of the postretirement benefit plan was as follows:

NOTE 9:

Special (Credits) Charges

The annual results for 1997 included a pretax net special credit of $31.5 million, which resulted in after tax income of $0.37 per basic share ($0.36 per diluted share). First quarter results included a $1.0-million pretax charge for Molson Breweries of Canada Limited (Molson) legal

Settlement rate 7. 25% 7.75% 7.25% Increase in compensation levels 4. 50% 5.00% 5.00% Rate of return on plan assets 10. 25% 10.25% 9.75%

Fo r the years ended December 28, December 29, December 31, 1997 1996 1995 ( In thousands) Service cost-benefits attributed to service during the period $ 1,408 $ 2,065 $ 2,281 Interest cost on accumulated postretirement benefit obligation 4,775 5,082 6,426 Amortization of net (gain) (353) (310) (560)

As of De cember 28, December 29, 1997 1996 (In thousands) Retirees $ 43,087 $ 39,780 Fully eligible active plan participants 5,411 5,014 Other active plan participants 19,418 17,883 Accumulated postretirement obligation 67,916 62,677 Unrecognized net gain 7,188 8,452 Unrecognized prior service cost 434 2,209 Accrued postretirement benefit obligation 75,538 73,338 Less current portion (3,630) (3,565) Long-term postretirement benefit $ 71,908 $ 69,773

proceedings. Second quarter results included a $71.5-million special credit relating to a payment from Molson to settle legal disputes with the Company, less approximately $2.2 million in related legal expenses. Also in the second quarter, CBC recorded a $22.4-million reserve related to the recoverability of its investment in Jinro-Coors Brewing Company (JCBC) of Korea (Note 10), as well as a $14.4-million charge related to CBC's brewery in Zaragoza, Spain (Note 2), for the impairment of certain long-lived assets and goodwill and for severance costs for a limited workforce reduction.

The annual results for 1996 included a pretax net special charge of $6.3 million which resulted in after tax expense of $0.11 per basic share ($0.10 per diluted share). Second quarter results included a $5.2-million pretax charge for the ongoing Molson legal proceedings and severance costs for restructuring the Company's engineering and construction operations. Results of the third quarter included a $6.7-million pretax credit for underpaid past royalties and interest from Molson (net of related legal expenses) and income from the continuing effect of changes made in payroll-related practices during 1995. Fourth quarter results included a $7.9-million pretax charge for Molson-related legal expenses, partially offset by underpaid past royalties from Molson and the continuing effect of changes made in payroll-related practices during 1995.

Fourth quarter results for 1995 included a pretax net special credit of $15.2 million which resulted in after tax income of $0.24 per basic and diluted share. The net credit was primarily the result of a gain for the curtailment of certain postretirement benefits other than pensions (see Note 8). Offsetting a portion of this curtailment gain are severance charges for limited reductions of the Company's work force.

NOTE 10:

Investments

Equity method investments: The Company has 50% or less owned investments in affiliates that are accounted for using the equity method of accounting. These investments aggregated $51.7 million and $47.6 million at December 28, 1997, and December 29, 1996, respectively. These investment amounts are included in other assets on the Company's consolidated balance sheets.

Summarized condensed balance sheet and income statement information for the Company's equity method investments are as follows:

Summarized condensed balance sheets:

The Company's share of operating income of these non-consolidated affiliates is primarily included in cost of goods sold on the Company's consolidated statements of income.

In 1995, CBC and Anchor Glass Container Corporation (Anchor) formed a 50/50 joint venture to produce glass bottles at the CBC glass manufacturing facility for sale to CBC and outside customers. In 1996, Owens-Brockway Glass Container, Inc. (Owens) purchased certain Anchor assets and assumed Anchor's role in the partnership. The agreement has an initial term of 10 years and can be extended for additional two-year periods. Under the terms of the agreement, CBC agreed to contribute machinery, equipment and certain personal property with an approximate net book value of $16.2 million and Owens agreed to contribute technology and capital, which would be used to modernize and expand the capacity of the plant. Also under the agreement, CBC agreed to reimburse certain annual operating costs of the facility and to purchase an annual quantity of bottles, which together represent a 1998 commitment of approximately $59 million. The expenditures under this agreement in 1997, 1996 and 1995 were approximately $59 million, $54 million and $23 million, respectively. Additionally, the companies entered into another 10-year agreement that made Owens a long-term, preferred supplier for CBC, satisfying 100% of CBC's other glass requirements.

In 1994, CBC and American National Can Company (ANC) formed a 50/50 joint venture to produce beverage cans and ends at CBC manufacturing facilities for sale to CBC and outside customers. The agreement has an initial term of seven years and can be extended for two additional three-year periods. Additionally, the agreement requires CBC to purchase 100% of its can and end needs from the joint venture at contracted unit prices and to pay an annual fee for certain operating costs. The aggregate amount paid to the joint venture for cans and ends in 1997, 1996 and 1995 was approximately $227 million, $217 million and $238 million, respectively. The estimated cost in 1998 under this

As of Dec ember 28, December 29, 1997 1996 (In thousands) Current assets $76,260 $69,975 Non-current assets 78,829 79,162 Current liabilities 40,859 38,186 Non-current liabilities 4,437 4,236 Summarized condensed statements of operations: For the years ended December 28, Dece mber 29, December 31, 1997 1996 1995 (In t housands) Net sales $372,479 $ 357,273 $363,864 Gross profit 39,459 37,372 44,890 Operating income 22,384 19,289 32,039 Company's equity in operating income 15,893 11,467 13,687

agreement for cans and ends is $231 million. Additionally, during 1997 CBC received a $12.5-million distribution from this joint venture.

Cost investments: Included in other assets is $47.1 million of investments in debt securities with maturities greater than one year. The fair value of these investments approximates their amortized cost, and they are considered to be available-for-sale.

CBC invested approximately $22 million in JCBC in 1992 for a 33% interest. CBC has accounted for the investment under the cost basis of accounting, given that CBC has not had the ability to exercise significant influence over JCBC and that CBC's investment in JCBC has been considered temporary. This investment included a put option which, as discussed below, was exercised by CBC in December 1997. The put option entitled CBC to require Jinro Limited (the 67% owner of JCBC) to purchase CBC's investment at the greater of cost or market value (both measured in Korean Won).

Beginning in April 1997, Jinro Limited, a publicly-traded subsidiary of Jinro Group, missed debt payments and began attempting to restructure. In response to its financial difficulties and those of its subsidiaries (including JCBC), Jinro Group has been working with its creditors and the Korean government to restructure its debts and has begun selling real estate and merging and/or selling businesses. The financial difficulties of JCBC and Jinro Limited, the guarantor of the put option discussed above, called into question the recoverability of CBC's investment in JCBC. Therefore, during the second quarter of 1997, CBC fully reserved for its investment in JCBC. This reserve was classified as a special charge in the accompanying statements of income.

CBC exercised its put option in December 1997. Since Jinro Limited's obligation under the put is measured in Korean Won and given the current significant devaluation of that currency, the full amount received from Jinro Limited would be significantly less (by approximately half as of December 28, 1997) than the value of CBC's original investment. Jinro Limited, which is operating under protection from its creditors under the Korean composition law, has until June 1998 to perform its obligation under the put option. Given Jinro Limited's current financial condition and the volatility of the Korean economy, CBC cannot predict whether Jinro Limited will be able to perform under this obligation.

ACX: CBC is a limited partner in a partnership in which a subsidiary of ACX is the general partner. The partnership owns, develops, operates and sells certain real estate previously owned directly by CBC or ACC. Each partner is obligated to make additional contributions of up to $500,000 upon call of the general partner. Distributions are allocated equally between the partners until CBC recovers its investment and thereafter 80% to the general partner and 20% to CBC. Currently distributions are still being split equally between the partners.

Colorado Baseball Partnership: In 1991, CBC entered into an agreement with Colorado Baseball Partnership 1993, Ltd. for an equity investment and multiyear signage and advertising package. This commitment, totaling approximately $30 million, was finalized upon the awarding of a National League baseball franchise to Colorado in 1991. The initial investment as a limited partner has been paid. The carrying value of this investment approximates its fair value at December 28, 1997, and December 28, 1996. The recognition of liability under the multiyear signage and advertising package began in 1995 with the opening of Coors Field.

NOTE 11:

Stock Activity and Earnings Per Share

Capital stock: Both classes of common stock have the same rights and privileges, except for voting, which (with certain limited exceptions) is the sole right of the holder of Class A stock.

Activity in the Company's Class A and Class B common stock for each of the three years ended December 28, 1997, December 29, 1996, and December 31, 1995, is summarized below:

At December 28, 1997, December 29, 1996, and December 31, 1995, 25,000,000 shares of $1 par value preferred stock were authorized but unissued.

Com mon stock Class A Class B Balances at December 25, 1994 1,260,000 37,066,940 Shares issued under stock plans -- 248,778 Purchase of stock -- (579,206) Balances at December 31, 1995 1,260,000 36,736,512 Shares issued under stock plans -- 256,897 Purchase of stock -- (331,005) Balances at December 29, 1996 1,260,000 36,662,404 Shares issued under stock plans -- 989,857 Purchase of stock -- (2,052,905) Balances at December 28, 1997 1,260,000 35,599,356

On December 20, 1996, the board of directors authorized the repurchase during 1997 of up to $40 million of ACC's outstanding Class B common stock on the open market. During 1997, the Company repurchased 969,500 shares for approximately $24.9 million under this stock repurchase program. In November 1997, the board of directors authorized repurchases of up to $40 million of stock during 1998. As of March 20, 1998, ACC had repurchased 647,000 shares for approximately $20.5 million under this program.

Also during 1997, the Company purchased shares under the right-of- first-refusal provision of its stock option plans and purchased shares from one of its directors and various other sources.

Earnings per share: ACC adopted Statement of Financial Accounting Standards No. 128, "Earnings per Share" (SFAS 128), effective with year-end 1997 reporting. SFAS 128 requires mandatory presentation of both a basic and diluted earnings per share. All per share amounts have been restated to comply with the requirements of SFAS 128. Basic and diluted net income per common share were arrived at using the calculations outlined below:

The dilutive effects of stock options were arrived at by applying the treasury stock method, assuming the Company was to purchase common shares with the proceeds from stock option exercises.

NOTE 12:

Commitments and Contingencies

Insurance: It is the Company's policy to act as a self-insurer for certain insurable risks consisting primarily of employee health insurance programs and general liability contract deductibles. During 1997, the Company fully insured future risks for workers' compensation and long-term disability, but maintains a self-insured position for claims incurred prior to the inception of the insurance coverage.

In 1991, the Company became aware that Mutual Benefit Life Insurance Company (MBLIC) had been placed under the control of the State of New Jersey. The Company is a holder of several life insurance policies and annuities through MBLIC. The cash surrender value under these policies is approximately $7.5 million. Policyholders have been notified that all claims, benefits and annuity payments will continue to be paid in full; however, at this time, policyholders are unable to redeem the full value of their policies for cash. A moratorium charge would be applied to policies that are redeemed.

Letters of credit: As of December 28, 1997, the Company has approximately $17 million outstanding in letters of credit with certain financial institutions. These letters generally expire within 12 months from the dates of issuance, which range from March 1998 to October 1998. These letters of credit are being maintained as security for performance on certain insurance policies, operations of underground storage tanks, as parent guarantees for bank financing and overdraft protection of a foreign subsidiary and payments of liquor and duty taxes and energy billings.

Power supplies: In 1995, Coors Energy Company (CEC), a subsidiary of CBC, sold a portion of its coal reserves to Bowie Resources Ltd. (Bowie). CEC also entered into a 10-year agreement to purchase 100% of the brewery's coal requirements from Bowie. The coal then is sold to Trigen-Nations Energy Corporation, L.L.L.P. (Trigen).

In September 1995, CBC concluded the sale of its power plant and support facilities to Trigen. In conjunction with this sale, CBC agreed to purchase the electricity and steam needed to operate the brewery's Golden facilities. CBC's financial commitment under this agreement is divided between a fixed, non-cancelable cost of approximately $12.5 million for 1998, which adjusts annually for inflation, and a variable cost, which is generally based on fuel cost and CBC's electricity and steam use.

ACX: At the end of 1992, the Company distributed to its shareholders the common stock of ACX. ACX was formed in 1992 to own the ceramics, aluminum, packaging and technology-based development businesses which were then owned by ACC. William K. Coors, a director of both ACC and ACX during 1997, and Peter H. Coors are trustees of one or more family trusts that collectively own all of ACC's voting

For the yea rs ended December 28, Dece mber 29, December 31, 1997 1996 1995 Net income available to (In thousands, ex cept per share data) common shareholders $82,260 $43,425 $43,178 Weighted average shares for basic EPS 37,218 37,966 38,164 Basic EPS $2.21 $1.14 $1.13 Effect of dilutive securities: Stock options 751 225 113 Contingent shares not included in shares outstanding for basic EPS 87 28 6 Weighted average shares for diluted EPS 38,056 38,219 38,283 Diluted EPS $2.16 $1.14 $1.13

stock and approximately 47% of ACX's common stock. Joseph Coors, a director of ACC, resigned as director of ACX in July 1996. ACC and ACX or their subsidiaries have certain business relationships and have engaged, or proposed to engage, in certain transactions with one another, as described below.

When ACX was spun off in 1992, CBC entered into market-based, long-term supply agreements with certain ACX subsidiaries to provide CBC packaging, aluminum and starch products. Under the packaging supply agreement, CBC agreed to purchase all of its paperboard (including composite packages, labels and certain can wrappers) from an ACX subsidiary through 1997. In early 1997, this contract was modified and extended until at least 1999. In early 1997, ACX's aluminum manufacturing business was sold to a third party. The aluminum contracts were canceled in 1995. Since late 1994, ANC has been the purchasing agent for the joint venture between ANC and CBC and has ordered limited quantities of can, end and tab stock from the now-former ACX subsidiary. Additionally, ANC purchased a small quantity of tab stock from this subsidiary for the joint venture in early 1997. Under the starch supply agreement, CBC agreed to purchase 100 million pounds of refined corn starch annually from an ACX subsidiary through 1997. In early 1997, this agreement was renegotiated, at slightly higher rates, and extended through 1999. CBC's total purchases under these agreements in 1997 were approximately $118 million. Purchases in 1998 under the packaging and starch supply agreements are estimated to be approximately $120 million.

Environmental: In 1991, the City and County of Denver, Waste Management of Colorado, Inc. and Chemical Waste Management, Inc. brought litigation in U.S. District Court against the Company and 37 other "potentially responsible parties" (PRPs) to determine the allocation of costs of Lowry site remediation. In 1993, the Court approved a settlement agreement between the Company and the plaintiffs, resolving the Company's liabilities for the site. The Company agreed to initial payments based on an assumed present value of $120 million in total site remediation costs. Further, the Company agreed to pay a specified share of costs if total remediation costs exceeded this amount. The Company remitted its agreed share, based on the $120 million assumption, to a trust for payment of site remediation, operating and maintenance costs. None of these payments was material to the Company's results of operations or financial position.

The City and County of Denver, Waste Management of Colorado, Inc. and Chemical Waste Management, Inc. have implemented site remediation. The Environmental Protection Agency's projected costs to meet the announced remediation objectives and requirements are currently below the $120 million assumption used for ACC's settlement. The Company has no reason to believe that total remediation costs will result in additional liability to the Company.

Litigation: The Company also is named as defendant in various actions and proceedings arising in the normal course of business. In all of these cases, the Company is denying the allegations and is vigorously defending itself against them and, in some instances, has filed counterclaims. Although the eventual outcome of the various lawsuits cannot be predicted, it is management's opinion that these suits will not result in liabilities that would materially affect the Company's financial position or results of operations.

Restructuring liability: At December 28, 1997, the Company had a $3.4 million liability related to personnel accruals as a result of a restructuring of operations that occurred in 1993. These accruals relate to obligations under deferred compensation arrangements and post-retirement benefits other than pensions.

Labor: Approximately 7% of the Company's work force, located principally at the Memphis brewing and packaging facility, is represented by a labor union with whom the Company engages in collective bargaining. A labor contract prohibiting strikes took effect in early 1997 and extends to the year 2001.

Rail transportation: The Company relies heavily upon rail transportation to ship approximately half of its products to satellite redistribution centers and to distributors throughout the country. A major disruption in the railroad industry would impact CBC significantly. However, the risk of such a disruption at the current time appears to be low.

Year 2000 (unaudited): As the Year 2000 approaches, ACC recognizes the need to ensure its operations will not be adversely impacted by Year 2000 software failures. The Company is addressing this issue to ensure the availability and integrity of its financial systems and the reliability of its operational systems. ACC has established processes for evaluating and managing the risks and costs associated with this problem. The Company has and will continue to make certain investments in its software systems and applications to ensure that it is Year 2000 compliant. The financial impact to ACC of Year 2000 remediation costs is anticipated to be in the range of $10 to $15 million in each of 1998 and 1999. In addition, ACC is working with its suppliers and customers to ensure their compliance with Year 2000 issues in order to avoid any interruptions in its business. While ACC does not at this time anticipate significant problems with suppliers and customers, it is developing contingency plans with these third parties due to the possibility of compliance issues.

NOTE 13:

Quarterly Financial Information (Unaudited)

The following summarizes selected quarterly financial information for each of the two years in the period ended December 28, 1997.

In the first and second quarters of 1997 and the second, third and fourth quarters of 1996, certain adjustments were made which were not of a normal and recurring nature. As described in Note 9, income in 1997 was increased by a special pretax credit of $31.5 million, or $0.37 per basic share ($0.36 per diluted share) after tax, and income in 1996 was decreased by a special pretax charge of $6.3 million, or $0.09 per basic share ($0.10 per diluted share) after tax. Refer to Note 9 for a further discussion of special (credits) charges.

ADOLPH COORS COMPANY AND SUBSIDIARIES QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

First Second Third Fourth Year 1996 (In thousands, except per share data)

Net sales without certain

Net (loss) income per common share - diluted ($ 0.08) $ 0.63 $ 0.49 $ 0.10 $ 1.14

ITEM 9. Disagreements on Accounting and Financial Disclosure

None.

PART III

ITEM 10. Directors and Executive Officers of the Registrant

(a) Directors

JOSEPH COORS (Age 80) is vice chairman of Adolph Coors Company (ACC or the Company) and has served in that capacity since 1975. He has served as a director since 1942. He retired from day-to-day operations in December 1987. He is a member of the Executive Committee and the Audit Committee. He is also a director of Coors Brewing Company (CBC). He was a director of ACX Technologies, Inc. (ACX) from October 1992 until his resignation in July 1996 and now is director emeritus.

PETER H. COORS (Age 51) is vice president of ACC and chief executive officer and vice chairman of CBC and has served in that capacity since 1993. He has served as a director of ACC since 1973. Prior to 1993, he served as executive vice president of ACC and chairman of the brewing group. He served as interim treasurer and chief financial officer from December 1993 to February 1995. He is also a director of CBC. He is a member of the Executive Committee. In his career at CBC, he has served in a number of different positions, including divisional president of sales, marketing and administration and secretary (1982-1985), senior vice president, sales and marketing (1978-1982), vice president (1976-1978) and assistant secretary and assistant treasurer (1974-1976). Since March 1996, he has been a director of U.S. Bancorp. Since 1997, he has been a director of Energy Corporation of America.

WILLIAM K. COORS (Age 81) is chairman of the board and president of ACC and has served in such capacities since 1970 and 1989, respectively. He has served as a director since 1940. He is the chairman of the Executive Committee. He is also a director and chairman of the board of CBC and ACX.

J. BRUCE LLEWELLYN (Age 70) has served as a director since 1989. He was a member of the Audit Committee until May 1996 and is the chairman of the Compensation Committee. He is also a director of CBC. He is an attorney and is involved in the management of several businesses in which he is an investor. He is currently the chairman of the board

First Second Third Fourth Year 1997 (In thousands , except per share data) Net sales $398,995 $520,826 $ 489,699 $412,631 $1,822,151 Gross profit $143,828 $220,163 $ 190,930 $146,452 $ 701,373 Net income $ 8,045 $ 51,018 $ 17,439 $ 5,758 $ 82,260 Net income per common share - basic $ 0.21 $ 1.37 $ 0.47 $ 0.16 $ 2.21 Net income per common share - diluted $ 0.21 $ 1.34 $ 0.46 $ 0.15 $ 2.16

international income $370,413 $504,000 $ 454,857 $401,719 $1,730,989 International income 1,258 1,092 1,093 7,624 11,067 Net sales, as currently reported $371,671 $505,092 $ 455,950 $409,343 $1,742,056 Gross profit $107,252 $196,759 $ 164,856 $145,500 $ 614,367 Net (loss) income ($ 3,007) $ 23,796 $ 18,675 $ 3,961 $ 43,425 Net (loss) income per common share - basic ($ 0.08) $ 0.63 $ 0.49 $ 0.10 $ 1.14

and chief executive officer of Philadelphia Coca Cola Bottling Co., Inc. He is also a director of Teleport Communications Group, Inc.

LUIS G. NOGALES (Age 54) has served as a director since 1989. He is a member of the Audit Committee and was a member of the Compensation Committee until May 1996. He is also a director of CBC. He is president of Nogales Partners, a media acquisition firm (1990-present). In the past, he was chairman and chief executive officer of Embarcadero Media (1992-1997); president of Univision, the nation's largest Spanish language television network (1986-1988) and chairman and chief executive officer of United Press International (1983-1986). He is also a director of Southern California Edison Company, Edison International and Kaufman and Broad Home Corporation.

PAMELA H. PATSLEY (Age 41) joined the Company as a director in November of 1996. She is also a director of CBC. She chairs the Audit Committee and is a member of the Compensation Committee. She is president, chief executive officer and a director of Paymentech, Inc. in Dallas. She began her career with First USA, Inc. in 1985 as a founding officer of the company. Before joining First USA, Patsley was with KPMG Peat Marwick. She is also a director of First Virtual Holdings, Inc.

WAYNE R. SANDERS (Age 50) joined the Company as a director in February of 1995. He is a member of the Compensation Committee and the Audit Committee. He is also a director of CBC. He is chairman of the board and chief executive officer of Kimberly-Clark (K-C) Corporation in Dallas. Sanders joined K-C in 1975 as a senior financial analyst. For the past 20 years, he has served in a number of positions with K-C. He was named to his current position in 1992. Prior to that, he served as president and chief executive officer (1991); and as president, World Consumer, Nonwovens and Service and Industrial Operations (1990). He was elected to K-C's board of directors in August 1989. He is also a director of Texas Instruments Incorporated and Chase Bank of Texas, a trustee of Marquette University and a national trustee of the Boys and Girls Clubs of America.

(b) Executive Officers

Of the above directors, Peter H. Coors and William K. Coors are executive officers of ACC. The following also were executive officers of ACC (as defined by Securities and Exchange Commission (SEC) rules) at March 1, 1998:

CARL L. BARNHILL (Age 49) joined CBC in May 1994 as senior vice president of sales. Barnhill brings more than 20 years of marketing experience with consumer goods companies. Most recently, he was vice president of selling systems development for the European and Middle East division of Pepsi Foods International. Prior to joining Pepsi in 1993, he spent 16 years with Frito-Lay in various upper-level sales and marketing positions.

L. DON BROWN (Age 52) joined CBC in July 1996 as senior vice president of operations and technology. Prior to joining CBC, he served as senior vice president of manufacturing and engineering at Kraft Foods where his responsibilities included manufacturing, engineering and operations quality functions. During his years at Kraft from 1971-1996, he held several positions of increasing responsibility in the manufacturing and operations areas.

ROBERT W. EHRET (Age 53) joined CBC in May 1994 as senior vice president, human resources. Prior to joining CBC, Ehret served as senior vice president of human resources for A.C. Nielsen. From 1983 to 1989, Ehret worked for PepsiCo Inc. as director of employee relations and personnel director for two of PepsiCo's international divisions based in Tokyo and London.

JOHN R. FAWCETT (Age 49) was named general manager of on-premise sales and marketing at CBC in August 1997. Prior to that, he was general manager of UniBev Ltd., a former division of CBC, responsible for sales and marketing for the brewery's specialty brands. Before joining CBC in September 1995, Fawcett was chief executive officer of a beverage wholesaler, Capital Wine and Beverage in Columbia, SC. Prior to that, he was vice president of sales at E&J Gallo.

W. LEO KIELY, III (Age 51) became president and chief operating officer of CBC as of March 1, 1993. Prior to joining CBC and for the period 1991 to 1993, he served as division vice president and then division president of the Frito- Lay, Inc. subsidiary of PepsiCo in Plano, Texas. From 1989- 1991, he served as senior vice president of field operations, overseeing the operations of Frito-Lay's four regional business teams. He is a director of Bell Sports Corporation and Signature Resorts, Inc.

ROBERT D. KLUGMAN (Age 50) was named CBC's senior vice president of corporate development in May 1994. In 1993, he was vice president of corporate development. Prior to that, he was vice president of brand marketing, a position he held from 1981-1987 and again from 1990-1993. From 1987 to 1990, he was vice president of international, development and marketing services. Before joining CBC, Klugman was a vice president of client services at Leo Burnett USA, a Chicago- based advertising agency.

NORMAN E. KUHL (Age 57) was named senior vice president of CBC's container business units in July 1997. Prior to that, he was vice president of CBC's container business units beginning January 1992, with responsibility for the can, glass and end manufacturing areas. His experience includes responsibility for warehousing, packaging, brewing, malting and utilities. He became vice president in 1978. In 1985, he became vice president and plant manager of the Company's packaging and finishing plant in Virginia. In 1990 and 1991, he served as vice president and plant manager of the brewery in Memphis.

KATHERINE L. MACWILLIAMS (Age 42) joined CBC in April 1996 as vice president and treasurer. Prior to joining CBC, she served as vice president of Capital Markets for UBS Securities in New York where she was responsible for the marketing of funding and asset-liability

management products to U.S. corporate clients. She has also held a wide range of financial positions for The First National Bank of Chicago; Sears, Roebuck and Co. and Ford Motor Company.

MICHAEL A. MARRANZINO (Age 50) was named senior vice president and chief information officer in November 1997. Since 1994, he had served as CBC's senior vice president and chief international officer. Prior to that, he served as vice president and director of international marketing. He has been with CBC since 1976 and has held positions in the information technology and sales and marketing areas, including director of development, director for Coors and Coors Extra Gold brands, director of sales and marketing operations, director of field sales, director of sales operations and technology system designer.

PATRICIA J. SMITH (Age 54) was named corporate secretary of CBC and ACC in 1993. She also serves in the same capacity for the majority of CBC's subsidiaries. She served as assistant secretary of ACC and a number of its subsidiaries from 1990-1993.

M. CAROLINE TURNER (Age 48) was named senior vice president and general counsel for CBC in February 1997. She has served as vice president and assistant secretary of ACC and assistant secretary of CBC since January 1993. She served as vice president, general counsel and chief legal officer of CBC (1993-1996); and vice president, chief legal officer (1991-1992); and director, legal affairs (1986- 1991) of ACC. Prior to joining the Company, she was a partner with the law firm of Holme Roberts & Owen (1983- 1986), an associate for Holme Roberts and Owen (1977-1982) and a clerk in the U.S. 10th Circuit Court of Appeals (1976-1977).

WILLIAM H. WEINTRAUB (Age 55) was named CBC's senior vice president of marketing in 1994. He joined CBC as vice president of marketing in July 1993. Prior to joining CBC, he directed marketing and advertising for Tropicana Products as senior vice president. From 1982-1991, Weintraub was with the Kellogg Company, with responsibility for marketing and sales.

TIMOTHY V. WOLF (Age 44) was named vice president and chief financial officer of ACC and senior vice president and chief financial officer of CBC in February 1995. Wolf came to CBC from Hyatt Hotels Corporation, where he served as senior vice president of planning and human resources from 1993 to 1994. From 1989 to 1993, he served in several executive positions for The Walt Disney Company including vice president, controller and chief accounting officer.

ACC and CBC employ other officers who are not considered executive officers under SEC regulations.

Terms for all officers and directors are for a period of one year, except that vacancies may be filled and additional officers elected at any regular or special meeting. Directors are elected at the Annual Shareholders' Meeting held in May. There are no arrangements or understandings between any officer or director pursuant to which any officer or director was elected as such.

(c) Significant Employees

None.

(d) Family Relationships

William K. Coors and Joseph Coors are brothers. Peter H. Coors is a son of Joseph Coors.

(e) Business Experience

See discussion above in (a) and (b).

(f) Involvement in Legal Proceedings

None.

(g) Section 16 Disclosures

None.

ITEM 11. Executive Compensation

I. SUMMARY COMPENSATION TABLE

ANNUAL COMPENSATION LONG TERM COMPENSATION AWARD S PAYOUTS NAME & YEAR SALARY BONUS OTHER RESTRI SECURITIES LTIP ALL PRINCIPAL ANNUAL CTED UNDERLYING PAYOUTS OTHER POSITION ($) ($) COMP STOCK OPTIONS ($) COMP (a) ($)(b) ($)(c ) (#)(d) ($)(e)

Company 1995 280,000 124,000 304,130 0 13,881 0 3,900

(a) Amounts awarded under the Management Incentive Compensation Program.

(b) In 1997, L. Don Brown received perquisites including moving and relocation expenses of $81,691. In 1996, none of the named executives received perquisites in excess of the lesser of $50,000 or 10% of salary plus bonus. In 1995, Timothy V. Wolf received perquisites including moving and relocation expenses of $293,450.

(c) In 1996, 45,390 shares of restricted stock were granted to L. Don Brown. L. Don Brown's restricted stock award has a three-year vesting period from the date of grant and is based on continuous service during the vesting period. Dividends are paid to the holder of the grant during the vesting period. The value as of December 28, 1997 was $1,418,438. Restricted stock granted in 1993 to Peter H. Coors and W. Leo Kiely III vested in 1996.

No restricted stock grants were made in 1997 or 1995 to any of the other named executives.

(d) See discussion under Item 11, Part II, for options issued in 1997.

(e) The amounts shown in this column are attributable to the officer life insurance other than group life, 401(k) plans and the excess of fair market value over option price for stock options exercised in 1997.

Of the named executives, Peter H. Coors receives officer life insurance provided by the Company until retirement. At the time of retirement, the officer's life insurance program terminates and a salary continuation agreement becomes effective. The officer's life insurance provides six times the executive base salary until retirement, at which time the Company becomes the beneficiary. The Company provides term life insurance for W. Leo Kiely III, L. Don Brown and Timothy V. Wolf. The officer's life insurance provides six times the executive base salary until retirement when the benefit terminates. The 1997 annual benefit for each executive for both programs was: Peter H. Coors - $7,299; W. Leo Kiely III - $4,642; L. Don Brown - $4,382 and Timothy V. Wolf - $2,428.

The Company's 50% match on the first 6% of salary contributed by the officer to ACC's qualified 401(k) plan was $4,750 for Peter H. Coors; $4,750 for W. Leo Kiely III; $4,750 for L. Don Brown and $4,750 for Timothy V. Wolf. Peter H. Coors and Timothy V. Wolf exercised stock options in 1997. See discussion in Item 11, Part III for stock option exercises in 1997.

In response to Code Section 162 of the Revenue Reconciliation Act of 1993, the Company appointed a special compensation committee to approve and monitor performance criteria in certain performance- based executive compensation plans for 1997.

II. OPTION/SAR GRANTS TABLE

Option Grants in Last Fiscal Year

William K. 1997 294,672 0 0 0 0 0 0 Coors, Chairman 1996 288,624 0 0 0 0 0 16,168 of the Board, CEO of Adolph 1995 285,624 0 0 0 0 0 34,095 Coors Company Peter H. 1997 541,428 324,229 0 0 157,625 0 1,302,264 Coors, Vice Chairman & CEO 1996 507,090 0 0 0 22,330 0 22,678 of Coors Brewing 1995 506,248 0 0 0 29,328 0 89,976 Company W. Leo Kiely 1997 424,692 263,593 0 0 92,451 0 9,392 III, President & COO of Coors 1996 400,218 0 0 0 18,154 0 8,705 Brewing Company 1995 399,376 0 0 0 23,843 0 8,458 L. Don Brown, 1997 360,504 280,000 112,233 0 33,600 0 9,132 Senior VP, Operations & 1996 180,346 580,000 0 800,000 58,333 0 3,467 Technology of Coors Brewing 1995 N/A N/A N/A N/A N/A N/A N/A Company Timothy V. 1997 326,516 163,834 0 0 44,134 0 83,303 Wolf, Senior VP, & CFO of 1996 314,346 0 0 0 10,568 0 6,778 Coors Brewing

(a) Grants vest one-third in each of the three successive years after the date of grant. At December 28, 1997, the 1997 grants were 0% vested because of the one year vesting requirement; however, they will vest 33 1/3% on the one-year anniversary of the grant dates.

III. OPTION/SAR EXERCISES AND YEAR-END VALUE TABLE

Aggregated Option/SAR Exercises in Last Fiscal Year, and FY-End

(a) Values stated are the bargain element recognized in 1997, which is the difference between the option price and the market price at the time of exercise.

IV. LONG-TERM INCENTIVE PLAN AWARDS TABLE

The Long-Term Incentive Plan (LTIP) was canceled by the board of directors at the November 1996 board meeting.

V. PENSION PLAN TABLE

The following table sets forth annual retirement benefits for representative years of service and average annual earnings.

POTENTIAL INDIVIDUAL GRANTS REALIZABLE VALUE AT ASSUMED RATES OF STOCK PRICE APPRECIATION FOR OPTION TERM % OF TOTAL NUMBER OF OPTIONS SECURITIES GRANTED TO NAME UNDERLYING EMPLOYEES EXERCISE OPTIONS IN OR BASE GRANTED FISCAL PRICE EXPIRA TION (#)(a) YEAR ($/SHARE) DAT E 5% 10% Peter H. 68,121 4% $18.7500 01/02 /07 $2,190,292 $4,244,242 Coors 51,100 3% $20.6250 02/13 /07 $1,547,204 $3,087,945 15,887 1% $31.7500 08/13 /07 $ 304,283 $ 783,300 22,517 2% $38.4375 09/29 /07 $ 280,685 $ 959,606 W. Leo 53,251 3% $18.7500 01/02 /07 $1,712,177 $3,317,774 Kiely III 39,200 3% $20.6250 02/13 /07 $1,186,896 $2,368,835 L. Don 33,600 2% $18.7500 01/02 /07 $1,080,339 $2,093,430 Brown Timothy 30,434 2% $18.7500 01/02 /07 $ 978,543 $1,896,174 V. Wolf 13,700 1% $20.6250 02/13 /07 $ 414,808 $ 827,883

Option/SAR Value NUMBER OF SECURI TIES VALUE OF UNDERLYING UNEXERCISED UNEXERCISED IN-THE-MONEY SHARES VALUE OPTIONS AT FY-END (#) OPTIONS AT FY-END ($) ACQUIRED ON REALIZED Exercis- Unexerc is- Exercis- Unexercis- NAME EXERCISE (#) ($)(a) able able able able Peter H. 71,035 1,290,215 179,794 135,10 8 $2,274,572 $1,394,449 Coors W. Leo 0 0 75,652 92,45 1 $1,015,974 $1,082,138 Kiely III L. Don 0 0 58,333 33,60 0 $ 772,912 $ 420,000 Brown Timothy 7,000 76,125 17,449 44,13 4 $ 197,528 $ 525,987 V. Wolf

AVERAGE YEARS OF SERVICE ANNUAL COMPENSATION 10 20 30 40 $125,000 $21,875 $43,750 $65,625 $71,875 150,000 26,250 52,500 78,750 86,250 175,000(a) 30,625 61,250 91,875 100,625 200,000(a) 35,000 70,000 105,000 115,000 225,000(a) 39,375 78,750 118,125 129,375(a) 250,000(a) 43,750 87,500 131,250(a ) 143,750(a)

(a) Maximum permissible benefit under ERISA from the qualified retirement income plan for 1997 was $125,000. Annual compensation exceeding $160,000 is not considered in computing the maximum permissible benefit under the qualified plan. The Company has a non-qualified supplemental retirement plan to provide full accrued benefits to all employees in excess of IRS maximums.

Annual average compensation covered by the qualified and non- qualified retirement plans and credited years of service for individuals named in Item 11(a) are as follows: William K. Coors - $274,441 and 58 years; Peter H. Coors - $503,255 and 26 years; W. Leo Kiely III - $408,095 and 4 years; L. Don Brown - $379,635 and 2 years and Timothy V. Wolf - $317,989 and 3 years.

The Company's principal retirement income plan is a defined benefit plan. The amount of contribution for officers is not included in the above table since total plan contributions cannot be readily allocated to individual employees. The Company's most recent actuarial valuation was as of January 1, 1997, in which the ratio of plan contributions to total compensation covered by the plan was approximately 6.5%. Covered compensation is defined as the total base salary (average of three highest consecutive years out of the last 10) of employees participating in the plan, including commissions but excluding bonuses and overtime pay. Compensation also includes amounts deferred by the individual under Internal Revenue Code Section 401(k) and any amounts deferred into a plan under Internal Revenue Code Section 125. Normal retirement age under the plan is 65. An employee with at least 5 years of vesting service may retire as early as age 55. Benefits are reduced for early retirement based on an employee's age and years of service at retirement; however, benefits are not reduced if: (1) the employee is at least age 62 when payments commence; or (2) the employee's age plus years of service equal at least 85 and the employee has worked for CBC at least 25 years. The amount of pension actually accrued under the pension formula is in the form of a straight life annuity.

In addition to the annual benefit from the qualified retirement plan, Peter H. Coors is covered by a salary continuation agreement. This agreement provides for a lump sum cash payment to the officer upon normal retirement in an amount actuarially equivalent in value to 30% of the officer's last annual base salary, payable for the remainder of the officer's life, but not less than 10 years. The interest rate used in calculating the lump sum is determined using 80% of the annual average yield of the 10-year Treasury constant maturities for the month preceding the month of retirement. Using 1997 eligible salary amounts as representative of the last annual base salary, the estimated lump sum amount for Peter H. Coors would be based upon an annual benefit of $162,000, paid upon normal retirement.

VI. COMPENSATION OF DIRECTORS

The Company adopted the Equity Compensation Plan for Non-Employee Directors (EC Plan) effective May 16, 1991. The EC Plan provides for two grants of ACC's Class B common stock (non-voting) to non- employee (NE) directors. The first grant is automatic and equals 20% of the annual retainer. The second grant is elective and allows the NE directors to take a portion, or all, of the remaining annual retainer in stock. Amounts of both grants are determined by the fair market value of the shares on the date of grant. Shares received under either grant may not be sold or disposed of before completion of the annual term. The Company reserved 50,000 shares of stock to be issued under the EC Plan. The NE directors' annual retainer is $32,000.

In 1997, the NE members of the board of directors were paid 50% of the $32,000 annual retainer for the 1996-1997 term and 50% of the $32,000 annual retainer for the 1997-1998 term, as well as reimbursement of expenses incurred to perform their duties as directors. Directors who are full-time employees of the Company receive $15,000 annually. All directors are reimbursed for any expenses incurred while attending board or committee meetings and in connection with any other CBC business. In addition, Joseph Coors, as a director and retired executive officer, is provided an office, transportation and secretarial support from CBC.

VII. EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT ARRANGEMENTS

CBC has no agreements with executives or employees providing employment for a set period.

L. Don Brown has an agreement providing a guaranteed bonus of 80% of his base salary in 1996 and 1997. In addition, he received a $200,000 signing bonus and a $100,000 transitional bonus in 1996. If he were terminated without cause during the first two years, he would receive 12 months of his total current annual salary (base plus bonus).

The standard severance program for officers is one year of base salary plus a prorated portion of any earned bonus for the year of severance.

275,000(a) 48,125 96,250 144,375(a ) 158,125(a) 300,000(a) 52,500 105,000 157,500(a ) 172,500(a) 325,000(a) 56,875 113,750 170,625(a ) 186,875(a) 350,000(a) 61,250 122,500 183,750(a ) 201,250(a) 375,000(a) 65,625 131,250(a) 196,875(a ) 215,625(a) 400,000(a) 70,000 140,000(a) 210,000(a ) 230,000(a) 425,000(a) 74,375 148,750(a) 223,125(a ) 244,375(a) 450,000(a) 78,750 157,500(a) 236,250(a ) 258,750(a) 475,000(a) 83,125 166,250(a) 249,375(a ) 273,125(a) 500,000(a) 87,500 175,000(a) 262,500(a ) 287,500(a) 525,000(a) 91,875 183,750(a) 275,625(a ) 301,875(a) 550,000(a) 96,250 192,500(a) 288,750(a ) 316,250(a) 575,000(a) 100,625 201,250(a) 301,875(a ) 330,625(a) 600,000(a) 105,000 210,000(a) 315,000(a ) 345,000(a)

Under the 1990 Equity Incentive Plan (1990 EI Plan), if there is a change in ownership of the Company, the options and restricted shares vest immediately.

VIII. COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

J. Bruce Llewellyn, Pamela H. Patsley and Wayne R. Sanders served on the Compensation Committee during 1997.

ITEM 12. Security Ownership of Certain Beneficial Owners and Management

(a) Security Ownership of Certain Beneficial Owners

The following table sets forth stock ownership of persons holding in excess of 5% of any class of voting securities as of March 16, 1998:

In addition, certain officers and directors hold interests in other family trusts, as indicated in Item 12, Section (b).

(b) Security Ownership of Management

The following table sets forth stock ownership of the Company's directors and all executive officers and directors as a group as of March 16, 1998:

group (20 persons) 17,420,959 783,000 18,203,959 52%

(a) In 1996, William K. Coors and Peter H. Coors were two of the trustees of the Adolph Coors Foundation, which owned 732,413 shares of Class B common stock. This stock was disposed of during 1997. William K. Coors, Joseph Coors and Peter H. Coors are trustees, in addition to other trustees and beneficiaries or contingent beneficiaries in certain cases, of various trusts that own an aggregate of 16,712,111 shares of Class B common stock. These individuals, and others, are trustees of three other trusts owning 267,100 shares of Class B common stock. In certain of these trusts, they act solely as trustees and have no vested or contingent benefits. The total of these trust shares, together with other management shares shown above, represents 52% of the total number of shares of such class outstanding.

(b) This column represents exercisable options to purchase shares under the Company's 1990 EI Plan (as amended and restated) and the 1991 Equity Compensation Plan for Non-Employee Directors (as amended and restated) that could be exercised as of March 16, 1998. It reflects restricted stock awards granted under the 1990 EI Plan. Vesting in the restricted stock is over a three-year period from date of grant for employee/officers and at the end of the term for outside directors. In the event of a change in control of the Company, the options and restricted shares vest immediately. It also reflects a special restricted stock award made in February 1997. This restricted stock has a one-year vesting period.

(c) Changes in Control

Name and address Amount a nd nature Title of of beneficial of ben eficial Percent class owner owne rship of class Class A Adolph Coors, Jr. Trust, 1,260,000 s hares for 100% common Golden, Colorado; benefit of William K. stock William K. Coors, Joseph Coors, Jose ph Coors and (voting) Coors, Joseph Coors, Jr., May Coors T ooker and their Jeffrey H. Coors and lineal desc endants living Peter H. Coors, trustees at distribu tion

Exercisab le options / Shares restrict ed Title of Name of beneficially stocks Percent class beneficial owner owned awards (b) Total of class Class B Joseph Coors 2,183 (a) 26 1 2,444(a) (a) common Peter H. Coors 75,801 (a) 242,16 4 317,965(a) (a) stock William K. Coors 320,807 (a) - - 320,807(a) (a) (non- J. Bruce Llewellyn 6,184 78 5 6,969 voting) Luis G. Nogales 1,850 26 1 2,111 Pamela H. Patsley 356 62 7 983 Wayne R. Sanders 5,267 26 1 5,528 L. Don Brown -- 116,09 6 116,096 W. Leo Kiely III 11,000 108,60 4 119,604 Timothy V. Wolf 2,700 33,22 1 35,921 All executive officers and directors as a

There are no arrangements that would later result in a change of control of the Company.

ITEM 13. Certain Relationships and Related Transactions

(a) Transactions with Management and Others

There were no transactions that exceeded $60,000 with management or others related to the Company.

(b) Certain Business Relationships

William K. Coors, a director of both ACC and ACX during 1997, and Peter H. Coors are trustees of one or more family trusts that collectively own all of ACC's voting stock and approximately 47% of ACX's common stock (see Security Ownership of Certain Beneficial Owners and Management in Item 12). Joseph Coors, a director of ACC during 1997, resigned as director of ACX in July 1996. ACC and ACX, or their subsidiaries have certain business relationships and have engaged or proposed to engage in certain transactions with one another, as described below.

When ACX was spun off in 1992, CBC entered into market-based, long-term supply agreements with certain ACX subsidiaries to provide CBC packaging, aluminum and starch products. Under the packaging supply agreement, CBC agreed to purchase all of its paperboard (including composite packages, labels and certain can wrappers) from an ACX subsidiary through 1997. In early 1997, this contract was modified and extended until at least 1999. In early 1997, ACX's aluminum manufacturing business was sold to a third party. The aluminum contracts were canceled in 1995. Since late 1994, American National Can Company (ANC) has been the purchasing agent for the joint venture between ANC and CBC and has ordered limited quantities of can, end and tab stock from the now-former ACX subsidiary. Additionally, ANC purchased a small quantity of tab stock for the joint venture from this subsidiary in early 1997. Under the starch supply agreement, CBC agreed to purchase 100 million pounds of refined corn starch annually from an ACX subsidiary through 1997. In early 1997, this agreement was renegotiated, at slightly higher rates, and extended through 1999. CBC's total purchases under these agreements in 1997 were approximately $118 million. Purchases in 1998 under the packaging and starch supply agreements are estimated to be approximately $120 million.

During 1997, CBC sold small quantities of aluminum scrap to a now- former ACX subsidiary in the amount of $280,000. CBC also agreed to sell brewery by-products to an ACX subsidiary for resale under a contract through 1997. In early 1997, this agreement was extended through 1999. CBC received approximately $9 million in 1997 under this contract and estimates that 1998 receipts will be approximately $9 million.

Also with the spin-off, ACC, ACX and their subsidiaries negotiated other agreements involving employee matters, environmental management, tax sharing and trademark licensing. These agreements govern certain relationships between the parties, as described in the Company's report on Form 8-K dated December 27, 1992, and contained in the information statement mailed to ACC's shareholders at the time of the spin-off.

Certain ACC and ACX subsidiaries are parties to other miscellaneous market-based transactions. In 1997, CBC provided water and waste water treatment services to an ACX ceramics facility located on property leased from CBC, and CBC received real estate management and other services from the ACX real estate brokerage subsidiary. In addition, CBC purchased miscellaneous products from the ACX ceramics subsidiary, including certain ceramic can tooling for CBC's can lines. During 1997, CBC received approximately $340,000 in total and paid approximately $350,000 in total under these agreements and transactions. In 1998, CBC expects to pay approximately $230,000 and receive approximately $260,000 under these agreements.

CBC is a limited partner in a partnership in which an ACX subsidiary is the general partner. The partnership, which was formed at the time of the spin-off, owns, develops, operates and sells certain real estate previously owned directly by CBC or ACC. Distributions of $1.3 million were made to both partners in 1997. Each partner is obligated to make additional cash contributions of $500,000 upon call of the general partner. Distributions are allocated equally between the partners until CBC recovers its investment, and thereafter 80% to the general partner and 20% to CBC. Currently distributions are still being split equally between the partners.

(c) Indebtedness of Management

Employee loans could be made with the exercise of stock options granted under the 1983 non-qualified Adolph Coors Company Stock Option Plan. No such loans were made or outstanding in 1997.

No member of management or another with a direct or indirect interest in ACC was indebted to the Company in excess of $60,000 in 1997.

PART IV

ITEM 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K

(a) The following documents are filed as part of this report:

(1) Financial Statements: See index of financial statements in Item 8.

(2) Financial Statement Schedules:

Schedule II - Valuation and Qualifying Accounts All other schedules are omitted, because they are not applicable or the required information is shown in the financial statements or notes thereto.

SCHEDULE II

ADOLPH COORS COMPANY AND SUBSIDIARIES VALUATION AND QUALIFYING ACCOUNTS

(a) Write-offs of uncollectible accounts or obsolete inventories and supplies.

(3) Exhibits:

Exhibit 3.1 - Amended Articles of Incorporation. (Incorporated by reference to Exhibit 3.1 to Form 10-K for the fiscal year ended December 30, 1990)

Exhibit 3.2 - By-laws, as amended and restated in August 1997.

Exhibit 4.1 - Form of Indenture for Adolph Coors Company Senior Debt Securities. (Incorporated by reference to Exhibit 4 to Registration Statement on Form S-3 filed March 14, 1990, and amended on March 26, 1990, file No. 33- 33831). Upon request, the Company agrees to provide a copy of any debt instrument as applicable under Regulation S-K, Item 601, (b)(4)(iii).

Exhibit 10.1 - Officers' Life Insurance Program. (Incorporated by reference to Exhibit 10 to Form 10-K for the fiscal year ended December 28, 1980)

Exhibit 10.2* - Officers and Directors Salary Continuation Agreement. (Incorporated by reference to Exhibit 10 to Form 10-K for the fiscal year ended December 26, 1982)

Exhibit 10.3* - 1983 non-qualified Adolph Coors Company Stock Option Plan, as amended effective February 13, 1992. (Incorporated by reference to Exhibit 10.3 to Form 10-K for the fiscal year ended December 29, 1991)

Exhibit 10.4* - Coors Brewing Company 1996 Annual Management Incentive Compensation Plan. (Incorporated by reference to Exhibit 10.4 to Form 10-K for the fiscal year ended December 29, 1996)

Exhibit 10.5* - Coors Brewing Company Long-Term Incentive Plan, 1994-1996 Plan Cycle. (Incorporated by reference to Exhibit 10.5 to Form 10-K for the fiscal year ended December 25, 1994)

Additions Balance at charged to Balance beginning costs and O ther at end of year expenses add itions Deductions of year Allowance for doubtful (In tho usands) accounts Year ended December 28, 1997 $ 275 $1,627 $ -- ($1,345)(a) $ 557 December 29, 1996 $ 30 $ 393 $ -- ($ 148)(a) $ 275 December 31, 1995 $ 24 $ 198 $ -- ($ 192)(a) $ 30 Allowance for certain claims Year ended December 28, 1997 $ -- $1,500 $ -- $ -- $1,500 December 29, 1996 $ -- $ -- $ -- $ -- $ -- December 31, 1995 $ -- $ -- $ -- $ -- $ -- Allowance for obsolete inventories and supplies Year ended December 28, 1997 $3,319 $7,193 $ 426 ($5,724)(a) $5,214 December 29, 1996 $2,942 $4,941 $ 3 ($4,567)(a) $3,319 December 31, 1995 $2,210 $2,814 $ -- ($2,082)(a) $2,942

Exhibit 10.6* - Adolph Coors Company 1990 Equity Incentive Plan. (Amended during 1998)

Exhibit 10.7* - Coors Brewing Company Employee Profit Sharing Program. (Incorporated by reference to Exhibit 10.7 to Form 10-K for the fiscal year ended December 31, 1995)

Exhibit 10.8 - Adolph Coors Company Non-Employee Director Compensation Deferral Plan. (Incorporated by reference to Exhibit 10.9 to Form 10-K for the fiscal year ended December 31, 1989)

Exhibit 10.9 - Agreement between Adolph Coors Company and a Former Executive Officer and Current Director. (Incorporated by reference to Exhibit 10.10 to Form 10-K for the fiscal year ended December 31, 1989)

Exhibit 10.10 - Form of Coors Brewing Company Distributorship Agreement. (Introduced 1989) (Incorporated by reference to Exhibit 10.11 to Form 10-K for the fiscal year ended December 31, 1989)

Exhibit 10.11 - Adolph Coors Company Water Augmentation Plan. (Incorporated by reference to Exhibit 10.12 to Form 10-K for the fiscal year ended December 31, 1989)

Exhibit 10.12 - Adolph Coors Company Equity Compensation Plan for Non- Employee Directors. (Amended during 1997)

Exhibit 10.13 - Distribution Agreement, dated as of October 5, 1992, between the Company and ACX Technologies, Inc. (Incorporated herein by reference to the Distribution Agreement included as Exhibits 2, 19.1 and 19.1A to the Registration Statement on Form 10 filed by ACX Technologies, Inc. (file No. 0-20704) with the Commission on October 6, 1992, as amended)

Exhibit 10.14* - Employment Contracts and Termination of Employment Agreements for W. Leo Kiely III. (Incorporated by reference to Exhibit 10.17 to Form 10-K for the fiscal year ended December 26, 1993)

Exhibit 10.15 - Revolving Credit Agreement, dated as of October 23, 1997.

Exhibit 10.16 - Adolph Coors Company Stock Unit Plan. (Amended during 1997)

Exhibit 10.17* - Employment Contract and Termination Agreement for L. Don Brown. (Incorporated by reference to Exhibit 10.4 to Form 10-K for the fiscal year ended December 29, 1996)

Exhibit 10.18* - Coors Brewing Company 1997 Annual Management Incentive Compensation Plan. (Incorporated by reference to Exhibit 10.4 to Form 10-K for the fiscal year ended December 29, 1996)

Exhibit 10.19 - Form of Coors Brewing Company Distributorship Agreement. (Incorporated by reference to Exhibit 10.20 to Form 10-K for the fiscal year ended December 29, 1996)

Exhibit 10.20* - Coors Brewing Company 1998 Annual Management Incentive Compensation Plan.

Exhibit 21 - Subsidiaries of the Registrant.

Exhibit 23 - Consent of Independent Accountants.

* Represents a management contract

(b) Reports on Form 8-K

A report on Form 8-K dated April 30, 1997, was filed announcing a settlement of legal disputes with Molson Breweries and related parties. See further discussion in Item 1 Business of this filing.

(c) Other Exhibits

None.

(d) Other Financial Statement Schedules

None.

Other Matters

To comply with the July 13, 1990, amendments governing Form S-8 under the Securities Act of 1933, ACC offers as follows, which is incorporated by reference into ACC's Registration Statements on Form S-8 No. 33-2761 (filed January 17, 1986); No. 33-35035 (filed May 24, 1990); No. 33-40730 (filed May 21, 1991) and No. 33-59979 (filed June 6, 1995) and on Form S-3 No. 33-33831 (filed March 14, 1990):

Even though ACC could indemnify its directors, officers and controlling persons for liabilities arising under the Securities Act of 1933 under SEC regulations, the SEC has indicated that such indemnification is against public policy and unenforceable. If a director, officer or controlling person requests indemnification for liabilities arising from securities being registered (other than for reimbursements of amounts paid for the successful defense of any lawsuit), ACC will ask a court if such indemnification is against public policy and will follow that court's ruling.

EXHIBIT 21

ADOLPH COORS COMPANY AND SUBSIDIARIES SUBSIDIARIES OF THE REGISTRANT

The following table lists ACC's subsidiaries and the respective jurisdictions of their organization or incorporation as of December 28, 1997. All subsidiaries are included in ACC's consolidated financial statements.

(a) Organized as a partnership for foreign purposes and as a corporation for U.S. purposes.

EXHIBIT 23

Consent of Independent Accountants

We hereby consent to the incorporation by reference in the Prospectus constituting part of the Registration Statement on Form S-3 (No. 33-33831) and in the Registration Statements on Form S-8 (No. 33-2761), (No. 33-35035), (No. 33-40730),(No. 33- 59979) and (No. 333-45869) of Adolph Coors Company of our report dated February 12, 1998 appearing on page 27 of this Form 10-K.

PRICE WATERHOUSE LLP

Denver, Colorado March 27, 1998

SIGNATURES

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

ADOLPH COORS COMPANY

State/country of organization or Name incorporation Coors Brewing Company Colorado Coors Brewing Company International, Inc. Colorado Coors Brewing International C.V.(a) The Netherlands Coors Brewing Iberica, S.A. Spain Coors Services, S.A. Switzerland Coors Distributing Company Colorado Coors Energy Company Colorado Gap Run Pipeline Company Colorado Coors Nova Scotia Co. Canada Coors Global, Inc. Colorado Coors Intercontinental, Inc. Colorado Coors Transportation Company Colorado The Rocky Mountain Water Company Colorado The Wannamaker Ditch Company Colorado Coors Japan Company, Ltd. Japan Coors Brewing International, Ltd. United Kingdom Coors Export Ltd. Barbados, West Indies Coors Canada, Inc. Canada

By /s/ William K. Coors William K. Coors Chairman and President

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

(Chief Executive Officer) By /s/ Timothy V. Wolf Timothy V. Wolf Vice President and Chief Financial Officer (Principal Financial Officer) (Principal Accounting Officer)

By /s/ Joseph Coors By /s/ J. Bruce Llewellyn Joseph Coors J. Bruce Llewellyn Vice Chairman By /s/ Peter H. Coors By /s/ Luis G. Nogales Peter H. Coors Luis G. Nogales Chief Executive Officer Coors Brewing Company By /s/ Wayne R. Sanders By /s/ Pamela H. Patsley Wayne R. Sanders Pamela H. Patsley March 30, 1998

ARTICLE 5

CIK: 0000024545

NAME: ADOLPH COORS COMPANY

MULTIPLIER: 1000

CURRENCY: USD

PERIOD TYPE YEAR FISCAL YEAR END DEC 28 1997 PERIOD START DEC 30 1996 PERIOD END DEC 28 1997 EXCHANGE RATE 1 CASH 168875 SECURITIES 42163 RECEIVABLES 124485 ALLOWANCES 0 INVENTORY 106479 CURRENT ASSETS 517194 PP&E 733117 DEPRECIATION 0 TOTAL ASSETS 1412083 CURRENT LIABILITIES 359146 BONDS 145000 PREFERRED MANDATORY 0 PREFERRED 0 COMMON 9736 OTHER SE 726832 TOTAL LIABILITY AND EQUITY 1412083 SALES 2208231 TOTAL REVENUES 1822151 CGS 1120778 TOTAL COSTS 1674752 OTHER EXPENSES (3694) LOSS PROVISION 0 INTEREST EXPENSE 4200 INCOME PRETAX 146893 INCOME TAX 64633 INCOME CONTINUING 82260 DISCONTINUED 0 EXTRAORDINARY 0 CHANGES 0 NET INCOME 82260 EPS PRIMARY 2.21 EPS DILUTED 2.16

BYLAWS OF

ADOLPH COORS COMPANY (A Colorado Corporation)

Amended and Restated as of August 14, 1997

BYLAWS OF

ADOLPH COORS COMPANY

TABLE OF CONTENTS Page ARTICLE I - Offices 1 1. Principal Office 1 2. Registered Office 1 3. Other Offices 1 ARTICLE II - Shareholders' Meetings 1 1. Annual Meetings 1 2. Special Meetings 1 3. Place of Special Meetings 2 4. Notice of Meetings 2 5. Waiver of Notice 3 6. Action Without A Meeting 3 7. Fixing Record Date 4 8. Shareholder' List 4 9. Quorum 4 10. Adjournment 4 11. Voting 5 12. Conduct of Meetings 5 13. Proxies 6 14. Inspectors 7 15. Meeting by Telecommunication 7 ARTICLE III - Board of Directors 8 1. Authority, Election and Tenure 8 2. Number and Qualification 8 3. Annual and Regular Meetings 8 4. Special Meetings 8 5. Notice of Special Meetings 8 6. Waiver of Notice 9 7. Action Without a Meeting 9 8. Quorum and Voting 10 9. Organization and Procedure 10 10. Resignation 10 11. Removal 10 12. Vacancies 10 13. Dissenting Directors 11 14. Executive and Other Committees 11 15. Compensation of Directors 12 16. Meeting by Telecommunication 12 ARTICLE IV - Officers 12 1. Appointment and Tenure 12 2. Resignation, Removal and Vacancies 13 3. Temporary Delegation of Duties 13 4. Chairman of the Board 13 5. Chief Executive Officer 13 6. President 13 7. Vice Presidents 14 8. Secretary 14 9. Treasurer 14 10. Assistant Secretaries and Assistant Treasu rers 15 11. Bond of Officers 15 12. Compensation 15 ARTICLE V - Directors' Conflicts of Interest 15 1. Conflicting Interest Transaction 15 2. Effect of Conflict of Interest 15 3. Notice to Shareholders 16 4. Interested Directors 16 ARTICLE VI - Indemnification 17 1. Directors 17 2. Officers and Employees 17 3. Mandatory Indemnification 17 4. Agents and Fiduciaries 17 5. Procedure 18 6. Other Remedies 18 7. Insurance 18 8. Notice to Shareholders 18 9. Selection of Counsel 19

ARTICLE I

Offices

1. Principal Office. The principal office of Adolph Coors Company (the "Company") shall be located in or near the City of Golden, Colorado. The Board of Directors, from time to time, may change the principal office of the Company. 2. Registered Office. The registered office of the Company required by the Colorado Business Corporation Act, as it may be amended or superseded (the "Act"), to be maintained in the State of Colorado may be, but need not be, identical with the principal office, and the address of the registered office may be changed from time to time by the Board of Directors. 3. Other Offices. The Company may have one or more offices at such place or places within or outside the State of Colorado as the Board of Directors may from time to time determine or as the business of the Company may require.

ARTICLE II Shareholders' Meetings

1. Annual Meetings. The annual meeting of the holders of the Class A Common Stock shall be held each year during the month of May on such date and at such time and place, either within or outside the State of Colorado, as may be determined by the Board of Directors from time to time. At such meeting, the holders of the Class A Common stock shall elect a Board of Directors and shall transact such other business as may be brought properly before the meeting. Holders of non-voting stock may be invited to attend the annual meeting, but shall not vote except with respect to matters on which their vote is required by the Act or the Articles of Incorporation. 2. Special Meetings. (a) Special meetings of shareholders for any purpose or purposes, unless otherwise prescribed by the Act or by the Articles of Incorporation, may be called at any time by the Chairman, by the President (if he is also a member of the Board of Directors) or by the Board of Directors. A special meeting shall be called by the President or the Secretary upon one or more written demands (which shall state the purpose or purposes therefor) signed and dated by the holders of shares representing not less than ten percent of all votes entitled to be cast on any issue proposed to be considered at the meeting. (b) The record date for determining the shareholders entitled to demand a special meeting is the date of the earliest of any of the demands pursuant to which the meeting is called, or the date that is 60 days before the date the first of such demands is received by the Company, whichever is later. (c) Business transacted at any special meeting of shareholders shall be limited to the purpose or purposes stated in the notice of such meeting. 3. Place of Special Meetings. Special meetings of shareholders shall be held at such place or places, within or outside the State of Colorado, as may be determined by the Board of Directors and designated in the notice of the meeting. If no place is designated in the notice, or if a special meeting is called otherwise than by the Board of Directors, the place of the meeting shall be the principal office of the Company. 4. Notice of Meetings. (a) Not less than 10 nor more than 60 days prior to each annual or special meeting of shareholders, written notice of the date, time and place of each meeting, and in the case of special meetings the purpose or purposes for which the meeting is called, shall be given to each shareholder

ARTICLE VII - Execution of Instruments; Loans; Chec ks and Endorsements; Deposits; Proxies 19 1. Execution of Instruments 19 2. Borrowing 19 3. Attestation 20 4. Loans to Directors, Officers and Employees 20 5. Checks and Endorsements 20 6. Deposits 20 7. Voting of Securities of Other Entities 20 ARTICLE VIII - Shares of Stock 21 1. Certificates of Stock 21 2. Shares Without Certificates 21 3. Transfer of Stock 21 4. Restrictions on Transfer 22 5. Preferred Stock 24 6. Holders of Record 25 7. Shares Held for the Account of a Specified Person or Persons 25 8. Lost, Destroyed and Mutilated Certifica 25 ARTICLE IX - Dividends and Other Distributions 25 ARTICLE X - Corporate Records 25 1. Permanent Records 25 2. Records at Principal Office 26 3. Addresses of Shareholders 26 4. Record of Shareholders 26 5. Inspection of Corporate Records 27 6. Audits of Books and Accounts 27 ARTICLE XI - Miscellaneous 27 1. Corporate Seal 27 2. Fiscal Year 27 3. Emergency Bylaws and Actions 27 4. Amendments 27 5. Gender 27 6. Definitions 28 7. Conflicts 28

entitled to vote at such meeting. If the authorized shares of the Company are proposed to be increased, at least 30 days' notice in like manner shall be given. If the Act prescribes notice requirements for particular circumstances (as in the case of the sale, lease or exchange of the Company's assets other than in the usual and regular course of business, or the merger or dissolution of the Company), the provisions of the Act shall govern. (b) Notice may be given in person or by telephone, telegraph, teletype, electronically transmitted facsimile, or other form of wire or wireless communication, and, if so given, shall be effective when received by the shareholder. Notice may also be given by deposit in the United States mail if addressed to the shareholder's address shown in the Company's current record of shareholders, and, if so given, shall be effective when mailed. (c) If three successive notices mailed to any shareholder in accordance with the provisions of these Bylaws are returned as undeliverable, no further notices to such shareholder shall be necessary until another address for such shareholder is made known to the Company. 5. Waiver of Notice. (a) A shareholder may waive any notice, whether before or after the date or time stated in the notice as the date or time when any action will occur or has occurred. The waiver shall be in writing, be signed by the shareholder entitled to the notice, and be delivered to the Secretary for inclusion in the minutes or filing with the corporate records, but such delivery and filing shall not be conditions of the effectiveness of the waiver. (b) A shareholder's attendance at a meeting: (i) Waives objection to lack of notice or defective notice of the meeting, unless the shareholder at the beginning of the meeting objects to holding the meeting or transacting business at the meeting because of lack of notice or defective notice; and (ii) Waives objection to consideration of a particular matter at the meeting that is not within the purpose or purposes described in the meeting notice, unless the shareholder objects to considering the matter when it is presented. 6. Action Without A Meeting. (a) Any action required or permitted to be taken at a shareholders' meeting may be taken without a meeting if all of the shareholders entitled to vote thereon consent in writing to the action taken. No action taken by written consent shall be effective unless the Company has received writings that describe and consent to the action, signed by all the shareholders entitled to vote on such action. Unless otherwise provided by the Act, action by written consent shall be effective as of the date the last writing necessary to effect the action is received by the Secretary, unless all of the writings necessary to effect the action specify a later date as the effective date of the action. (b) Any shareholder who has signed a writing describing and consenting to action taken by written consent may revoke such consent by a writing signed by the shareholder describing the action and stating that the shareholder's prior consent thereto is revoked, if such writing is received by the Company before the effectiveness of the action. (c) The record date for determining shareholders entitled to take action without a meeting or entitled to be given notice is the date a writing upon which the action is taken is first received by the Company. 7. Fixing Record Date. The Board of Directors may fix a future date as the record date to determine the shareholders entitled to be given notice of a shareholders meeting, to demand a special meeting, to vote at a meeting, to receive payment of a distribution, or for any other proper purpose. Such record date shall not be more than 70 days before the meeting or action requiring a determination of shareholders. A determination of shareholders entitled to be given notice of or to vote at any meeting of shareholders is effective for any adjournment of the meeting, unless the Board of Directors fixes a new record date, which it shall do if the meeting is adjourned to a date more than 120 days after the date fixed for the original meeting. 8. Shareholders' List. (a) A complete list of the shareholders entitled to notice of any shareholders' meeting shall be prepared by, or at the direction of, the Secretary of the Company. Such shareholders' list shall be arranged by voting groups (as defined by the Act) and, within each voting group, by class or series of shares, shall be alphabetical within each class or series and shall show the address of, and the number of shares of each such class and series that are held by, each shareholder. (b) The shareholders' list shall be available for inspection by any shareholder beginning on the earlier of ten days before the meeting for which the list was prepared or two business days after notice is given, and continuing through the meeting and any adjournment thereof, at the Company's principal office or at a place identified in the notice of the meeting in the city where the meeting will be held. During the period the list is available for inspection, a shareholder, or his agent or attorney, is entitled on written demand to inspect and, subject to the provisions of the Act, to copy the list during the Company's regular business hours. Failure to prepare or make available the shareholders' list does not affect the validity of actions taken at the meeting. 9. Quorum. Shares entitled to vote as a separate voting group may take action on a matter at a meeting only if a quorum of those shares is represented in person or by proxy with respect to that matter. Unless otherwise provided in the Act or in the Company's Articles of Incorporation, a majority of the votes entitled to be cast on a matter by a voting group constitutes a quorum of that voting group for action on that matter. If a quorum is not present with respect to a particular matter, the shares present at the meeting shall have the power to adjourn the meeting with respect to that matter, until the requisite number of shares shall be present or represented. 10. Adjournment. When a meeting is for any reason adjourned to another date, time or place, notice need not be given of the adjourned meeting if the date, time and place thereof are announced at the meeting at which the adjournment is taken. At the adjourned meeting, any business may be transacted that might have been transacted at the original meeting. If the adjournment is for more than 120 days from the date of the original meeting, or if, after the adjournment, a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each shareholder entitled to vote at such meeting as of the new record date. 11. Voting. Each outstanding share of record of Class A Common Stock is entitled to one vote for the election of each member of the Board of Directors and on other matters submitted to a vote of the shareholders. Except where the Act or the Articles of Incorporation require a different vote, if a quorum exists, action on a matter other than the election of directors is approved if the votes cast favoring the action exceed the votes cast opposing the action. In an election of directors, a majority of shares entitled to vote for directors is required in order to elect a director. The voting rights of shares of Class B Common Stock shall only be as required in certain instances by the Act or the Articles of Incorporation. No shareholder shall be permitted to cumulate his votes. 12. Conduct of Meetings. The chairman of the annual or any special meeting of the shareholders shall be the Chairman of the Board or, in his absence, any person designated by the Board of Directors. The Secretary or, in his absence, any person appointed by the chairman of the meeting shall act as Secretary of the meeting. Meetings of shareholders shall be conducted in accordance with the following rules: (a) The chairman of the meeting shall have absolute authority over matters of procedure and there shall be no appeal from the ruling of the

chairman. If the chairman, in his absolute discretion, deems it advisable to dispense with the rules of parliamentary procedure as to any meeting of shareholders or a part thereof, the chairman shall so state and shall clearly state the rules under which the meeting or appropriate part thereof shall be conducted. (b) If disorder shall arise that prevents continuation of the legitimate business of the meeting, the chairman may quit the chair and announce the adjournment of the meeting and upon his so doing the meeting is immediately adjourned. (c) The chairman may ask or require that anyone who is not a bona fide shareholder or proxy leave the meeting. (d) At any meeting of shareholders, a resolution or motion shall be considered for vote only if the proposal is brought properly before the meeting, which shall be determined by the chairman of the meeting in accordance with the following provisions: (i) Notice required by these Bylaws and by all applicable federal or state statutes or regulations shall have been given to, or waived by, all shareholders entitled to vote on such proposal. In the event notice periods of different lengths apply to the same proposed action under different laws or regulations, appropriate notice shall be deemed given if there is compliance with the greater of all applicable notice requirements. (ii) Proposals may be made by the Board of Directors as to matters affecting holders of any class of stock issued by the Company. Proposals also may be made by the holder of shares of Class A Common Stock. (iii) Any proposal made by the Board of Directors or the holder of shares of Class A Common Stock may be made at any time prior to or at the meeting if only the holder of Class A Common Stock is entitled to vote thereon. (iv) Any proposal on which holders of Class B Common Stock are entitled to vote and concerning which proxies may be solicited by the proponent or by management shall be filed with the Secretary by such dates as may be required by the proxy rules promulgated by the Securities and Exchange Commission. (v) A shareholder's proposal shall set forth (a) a brief description of the matters desired to be brought before the meeting and the reasons for conducting such business at the meeting; (b) the name and address, as they appear on the Company's books, of the shareholder proposing such business; (c) the class and number of such shares of the Company which are beneficially owned by the shareholder; (d) any financial interest of the shareholder in such proposal; and (e) any other information required by applicable statute or regulation. (e) Nomination of persons to stand for election to the Board of Directors at any annual or special shareholders meeting may be made by the holders of the Company's Class A Common Stock at any time prior to the vote thereon. 13. Proxies. (a) At any shareholder meeting, a shareholder may vote in person or by proxy. A shareholder may appoint a proxy by signing an appointment form, either personally or by the shareholder's duly authorized attorney-in-fact. A shareholder may also appoint a proxy by transmitting or authorizing the transmission of a telegram, teletype or other electronic transmission providing a written statement of the appointment to the Company, the proxy, or other person duly authorized by the proxy to receive appointments as agent for the proxy. The transmitted appointment shall set forth or be transmitted with written evidence from which it can be determined that the shareholder transmitted or authorized the transmission of the appointment. (b) An appointment of a proxy is effective when the appointment is received by the Company and the appointment is effective for eleven months unless a different period is expressly provided in the appointment form. An appointment of a proxy shall be revocable by the shareholder only as provided by the Act. Shares represented by proxy at a meeting of shareholders shall be deemed to be present at the meeting. 14. Inspectors. The chairperson of the meeting may at any time appoint one or more inspectors to serve at a meeting of the shareholders. Such inspectors shall decide upon the qualifications of voters, including the validity of proxies, accept and count the votes for and against the matters presented, report the results of such votes, and subscribe and deliver to the Secretary of the meeting a certificate stating the number of shares of stock within each voting group that is issued and outstanding and entitled to vote thereon and the number of shares within each voting group that voted for and against the matters presented. The voting inspectors need not be shareholders of the Company, and any director or officer of the Company may be an inspector on any matter other than a vote for or against such director's or officer's election to any position with the Company or on any other matter in which such officer or director may be directly interested. 15. Meeting by Telecommunication. If, and only if, permitted by the Board of Directors, a shareholder may participate in an annual or special shareholders' meeting by, or the meeting may be conducted through the use of, any means of communication by which all persons participating in the meeting may hear each other during the meeting. If the Board of Directors determines to allow shareholders to participate in a shareholders' meeting by telecommunication, the Board shall establish the terms and conditions under which shareholders may participate by such means and shall cause the notice of the meeting to contain such terms and conditions. Only shareholders who comply with the terms and conditions indicated in such notice shall be entitled to so participate by telecommunication in the shareholders' meeting.

ARTICLE III

Board of Directors

1. Authority, Election and Tenure. Subject to any provision of the Act and the Articles of Incorporation, all corporate power shall be exercised by or under the authority of, and the business and affairs of the Company shall be managed by, a Board of Directors. The Board of Directors shall be elected at each annual meeting of shareholders by the holders of the Class A Common Stock. Each director shall hold office until the next annual meeting of shareholders, until such director's successor shall be elected and shall qualify, or until such director's earlier death, resignation or removal. 2. Number and Qualification. At each annual meeting of shareholders, the holders of the Class A Common Stock shall determine the number of directors, which shall be no fewer than three. Any increase in the number of directors between annual meetings shall be approved by the holders of the Class A Common Stock. Directors must be natural persons at least eighteen years of age but need not be shareholders or residents of the State of Colorado. 3. Annual and Regular Meetings. The Board of Directors shall hold its annual meeting without notice on the same day and at the same place as, but just following, the annual meeting of the shareholders, or at such other date, time and place as may be determined by the Board of Directors. Regular meetings of the Board of Directors shall be held without notice at such dates, times and places as may be determined by the Board of Directors by resolution.

4. Special Meetings. Special meetings of the Board of Directors may be held, with proper notice, upon the call of the Chairman of the Board or by at least two members of the Board of Directors at such time and place as specified in the notice. 5. Notice of Special Meetings. (a) Notice of the date, time and place of each special meeting of the Board of Directors shall be given to each director at least two days prior to such meeting. The notice of a special meeting of the Board of Directors need not state the purposes of the meeting. Notice to each director of any special meeting may be given in person; by telephone, telegraph, teletype, electronically transmitted facsimile, or other form of wire or wireless communication; or by mail or private carrier. (b) Oral notice to a director of any special meeting is effective when communicated. Written notice to a director of any special meeting is effective at the earliest of: (i) the date received; (ii) five days after it is mailed; or (iii) the date shown on the return receipt if mailed by registered or certified mail, return receipt requested, if the return receipt is signed by or on behalf of the director to whom the notice is addressed. 6. Waiver of Notice. (a) A director may waive any notice of a meeting before or after the time and date of the meeting stated in the notice. The waiver shall be in writing and signed by the director entitled to the notice. Such waiver shall be delivered to the Secretary for filing with the corporate records, but such delivery and filing shall not be conditions of the effectiveness of the waiver. (b) A director's attendance at or participation in a meeting waives any required notice to him of the meeting unless: (i) At the beginning of the meeting, or promptly upon his later arrival, the director objects to holding the meeting or transacting business at the meeting because of lack of notice or defective notice and does not thereafter vote for or assent to action taken at the meeting; or (ii) If special notice was required of a particular purpose, the director objects to transacting business with respect to the purpose for which such special notice was required and does not thereafter vote for or assent to action taken at the meeting with respect to such purpose. 7. Action Without a Meeting. Any action required or permitted to be taken at a meeting of the Board of Directors may be taken without a meeting if all members of the Board of Directors consent to such action in writing. Such consent shall be delivered to the Secretary for inclusion in the minutes or for filing with the corporate records. Action is taken by written consent at the time the last director signs a writing describing the action taken, unless, before such time, any director has revoked his consent pursuant to the provisions of the Act. Action taken without a meeting is effective at the time it is taken unless the directors establish a different effective date. Action taken by written consent has the same effect as action taken at a meeting of the Board of Directors, and may be described as such in any document. 8. Quorum and Voting. Except as otherwise provided by the Act or by these Bylaws, a majority of the directors in office at the time of any regular or special meeting of the Board of Directors shall constitute a quorum for the transaction of business at such meeting. The vote of a majority of the directors present at the meeting at which a quorum is present shall be the act of the Board of Directors. In the absence of a quorum, a majority of the directors present may, without notice other than announcement at the meeting, adjourn the meeting from time to time until a quorum can be obtained. 9. Organization and Procedure. The Board of Directors shall elect a Chairman of the Board from among its members. If the Board deems it necessary, it may elect a Vice-Chairman of the Board from among its members to perform the duties of the Chairman of the Board in his absence and such other duties as the Board of Directors may assign. The Chairman of the Board or, in his absence, the Vice-Chairman of the Board, or in his absence, any director chosen by a majority of the directors present, shall act as chairperson of the meetings of the Board of Directors. The Secretary, any Assistant Secretary, or any other person appointed by the chairperson shall act as secretary of each meeting of the Board of Directors. 10. Resignation. Any director of the Company may resign at any time by giving written notice to the Board of Directors or the Secretary of the Company at the Company's principal office. Such resignation shall take effect at the date of receipt of such notice or at any later time specified therein and, unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective. 11. Removal. Any director may be removed, either with or without cause, at any time, at a special meeting of the holders of the Class A Common Stock called for such purpose, if the number of votes cast in favor of removal exceeds the number of votes cast against removal. A vacancy in the Board of Directors caused by any such removal may be filled by the holders of the Class A Common Stock at such meeting or, if such shareholders at such meeting shall fail to fill such vacancy, by a majority of the remaining directors at any time before the end of the unexpired term of the director removed. 12. Vacancies. Any directorship to be filled by reason of an increase in the number of directors between annual meetings shall be filled by the vote of the holders of the Class A Common Stock and such director shall hold office until the next annual meeting of shareholders and until his successor has been elected and qualified. A vacancy occurring in the Board of Directors that is not required by these Bylaws to be filled by the holder of the Class A Common Stock shall be filled by the affirmative vote of a majority of the remaining members of the Board even if the remaining directors constitute less than a quorum. A director elected to fill a vacancy shall be elected for the unexpired term of his predecessor in office. 13. Dissenting Directors. A director who is present at a meeting of the Board of Directors when corporate action is taken is deemed to have assented to the action taken unless: (a) He objects at the beginning of such meeting, or promptly upon his later arrival, to the holding of the meeting or the transacting of business at the meeting; (b) He contemporaneously requests that his dissent or abstention from the action taken be entered in the minutes of such meeting; or (c) He gives written notice of his dissent or abstention to the presiding officer of such meeting before its adjournment or to the Secretary of the Company promptly after adjournment of such meeting.

The right of dissent as to a specific action in a meeting of the Board or a committee is not available to a director who votes in favor of such action. 14. Executive and Other Committees. Except as otherwise required by the Act, the Board of Directors, by the vote of a majority of the number of directors then in office, may designate from among its members an executive committee and one or more other committees each of which, to the extent provided in the resolution and except as otherwise prescribed by the Act, shall have and may exercise the authority delegated to them by the Board of Directors by charter, resolution or otherwise. No committee shall: (a) authorize dividends or other distributions; (b) approve or propose to shareholders action that the Act requires to be approved by shareholders;

(c) fill vacancies on the Board of Directors or on any of its committees; (d) amend the Articles of Incorporation; (e) adopt, amend, or repeal these Bylaws; (f) approve a plan of merger not requiring shareholder approval; (g) authorize or approve reacquisition of shares, except according to a formula or method prescribed by the Board of Directors; or (h) authorize or approve the issuance or sale of shares, or a contract for the sale of shares, or determine the designation and relative rights, preferences, and limitations of a class or series of shares, except that with respect to this clause (h) the Board of Directors may authorize a committee to do so within limits specifically prescribed by the Board of Directors.

The provisions of these Bylaws governing meetings, action without meeting, notice, waiver of notice, and quorum and voting requirements of the Board of Directors shall apply to committees and the members thereof. Each committee established by the Board of Directors shall prepare minutes of its meetings which shall be delivered to the Secretary of the Company for inclusion in the Company's records. 15. Compensation of Directors. The Board of Directors shall determine and fix the compensation, if any, and the reimbursement of expenses which shall be allowed and paid to the directors. Nothing herein contained shall be construed to preclude any director from serving the Company in any other capacity or any of its subsidiaries in any other capacity and receiving proper compensation therefor. 16. Meeting by Telecommunication. One or more members of the Board of Directors may participate in a meeting of the Board of Directors through the use of any means of communication by which all persons participating in the meeting can hear each other at the same time. Such participation shall constitute presence in person at the meeting.

ARTICLE IV

Officers

1. Appointment and Tenure. The officers of the Company shall consist of a Chairman of the Board (sometimes herein called the "Chairman"), a President, a Secretary and a Treasurer. The Board of Directors may also designate and appoint such other officers and assistant officers as may be deemed necessary. The Board of Directors shall appoint the Company's officers annually or at such other times as the Board shall designate. Such officers at all times shall be subject to the supervision, direction and control of the Board of Directors. The Board of Directors may delegate, by specific resolution, to an officer the power to appoint other specified officers or assistant officers. Each officer appointed shall continue in office until the next annual meeting of the Board of Directors at which officers are appointed, or until such officer's earlier death, resignation or removal. Any two or more offices may be held by the same person. Each officer shall be a natural person who is eighteen years of age or older. 2. Resignation, Removal and Vacancies. Any officer may resign at any time by giving written notice of resignation to the Board of Directors by delivery of such notice to the Secretary. Such resignation shall take effect when the notice is received by the Company unless the notice specifies a later effective date, and unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective. The Board of Directors may remove any officer at any time with or without cause. The Board of Directors may also delegate to an officer the power to remove other specified officers or assistant officers. If any office becomes vacant for any reason, the vacancy may be filled by, or as specifically authorized by, the Board of Directors. An officer appointed to fill a vacancy shall serve for the unexpired term of such officer's predecessor, or until such officer's earlier death, resignation or removal. 3. Temporary Delegation of Duties. In case of the absence of any officer, or his disability to perform his duties, or for any other reason deemed sufficient by the Board of Directors, the Board may delegate the powers and duties of such officer to any other officer or to any director temporarily, provided that a majority of the whole Board concur and that no such delegation shall result in giving to the same person conflicting duties. 4. Chairman of The Board. The Chairman of the Board shall preside at meetings of the Board of Directors and of the shareholders at which he is present, and shall perform such other duties as the Board of Directors may from time to time determine. 5. Chief Executive Officer. The Chief Executive Officer (sometimes referred to herein as the "CEO"), if one is elected by the Board of Directors, shall perform all duties customarily delegated to the chief executive officer of a corporation and such other duties as may from time to time be assigned to him by the Board of Directors and these Bylaws. 6. President. If there is no separate Chief Executive Officer, the President shall be the CEO of the Company; otherwise, the President shall be responsible to the CEO for the day-to-day operations of the Company. The President shall have general and active management of the business of the Company; shall see that all orders and resolutions of the Board of Directors are carried into effect; and shall perform all duties as may from time to time be assigned by the Board of Directors or the Chief Executive Officer. 7. Vice Presidents. The Vice Presidents, if any, shall perform such duties and possess such powers as from time to time may be assigned to them by the Board of Directors or the President. 8. Secretary. The Secretary of the Company (sometimes referred to herein as the "Secretary") shall have the duty and power to: (a) Assure that all notices are given in accordance with the provisions of these Bylaws and as required by law. (b) Prepare and maintain the minutes of the meetings of the shareholders, the Board of Directors and committees thereof, and other records and information required to be kept by the Company pursuant to the Act, including those records set forth in Article X of these Bylaws. (c) Authenticate records of the Company. (d) In general, perform all duties incident to the office of Secretary and such other duties as may, from time to time, be assigned to him by the Board of Directors or the President. 9. Treasurer. The Treasurer shall have the duty and power to: (a) Have the charge and custody of, and be responsible for, all funds and securities of the Company and deposit all such funds in the name of the Company in such banks, trust companies or other depositories as shall be selected in accordance with the provisions of these Bylaws or as directed by the Board. (b) Maintain books of account and records and exhibit such books of account and records to any of the directors of this Company at any reasonable time. (c) Render a statement of the condition of the finances of the Company as requested by the Board of Directors and, if called upon to do so,

make a full financial report at the annual meeting of the shareholders. (d) Receive, and give receipts for, monies due and payable to the Company from any source whatsoever. (e) In general, perform all of the duties incident to the office of Treasurer and such other duties as may, from time to time, be assigned to him by the Board of Directors or the President. 10. Assistant Secretaries and Assistant Treasurers. The Assistant Secretaries and Assistant Treasurers, if any, shall perform such duties as shall be assigned to them by the Secretary or the Treasurer, respectively, or by the President or the Board of Directors. In the absence or at the request of the Secretary or the Treasurer, the Assistant Secretaries or Assistant Treasurers, respectively, shall perform the duties and exercise the powers of the Secretary or Treasurer, as the case may be. 11. Bond of Officers. The Board of Directors may require any officer or agent to give the Company a bond in such sum and with such surety or sureties as shall be satisfactory to the Board of Directors for such terms and conditions as the Board of Directors may specify, including without limitation for the faithful performance of such officer's duties and for the restoration to the Company of any property belonging to the Company in such officer's possession or under the control of such officer. 12. Compensation. The salaries and other compensation of the officers shall be fixed or authorized from time to time by the Board of Directors. No officer shall be prevented from receiving such salary or other compensation by reason of the fact that he is also a director of the Company.

ARTICLE V Directors' Conflicts of Interest

1. Conflicting Interest Transaction. The term "conflicting interest transaction" means any of the following: (a) A loan or other assistance by the Company to a director of the Company or to an entity in which a director of the Company is a director or officer or has a financial interest; (b) A guaranty by the Company of an obligation of a director of the Company or of an obligation of an entity in which a director of the Company is a director or officer or has a financial interest; or (c) A contract or transaction between the Company and a director of the Company or between the Company and an entity in which a director of the Company is a director or officer or has a financial interest. 2. Effect of Conflict of Interest. No conflicting interest transaction shall be void or voidable solely because the conflicting interest transaction involves a director of the Company or an entity in which a director of the Company is a director or officer or has a financial interest or solely because the director is present at or participates in the meeting of the Board of Directors which authorizes, approves, or ratifies the conflicting interest transaction or solely because the director's vote is counted for such purpose if: (a) The material facts as to the director's relationship or interest and as to the conflicting interest transaction are disclosed or are known to the Board of Directors or the committee, and the Board or committee in good faith authorizes, approves, or ratifies the conflicting interest transaction by the affirmative vote of a majority of the disinterested directors, even though the disinterested directors are less than a quorum; or (b) The material facts as to the director's relationship or interest and as to the conflicting interest transaction are disclosed, or are known to the shareholders entitled to vote thereon, and the conflicting interest transaction is specifically authorized, approved, or ratified in good faith by vote of such shareholders; or (c) The conflicting interest transaction is fair as to the Company as of the time it is authorized, approved, or ratified by the Board of Directors, a committee thereof, or the shareholders. 3. Notice to Shareholders. The Board of Directors or a committee thereof shall not authorize a conflicting interest transaction consisting of a loan or guaranty pursuant to paragraph (a) of Section 1 above until at least 10 days after written notice of the proposed authorization of the loan or guaranty has been given to the shareholders who would be entitled to vote thereon if the issue of the loan or guaranty were submitted to a vote of the shareholders. 4. Interested Directors. Interested directors may be counted in determining the presence of a quorum at a meeting of the Board of Directors or of a committee which authorizes, approves, or ratifies the contract or transaction.

ARTICLE VI

Indemnification

1. Directors. The Company shall indemnify, to the fullest extent allowed by the Act, but subject to all conditions and limitations provided by the Act, any person who serves or who has served at any time as a director of the company, and any director who, at the request of the Company, serves or at any time has served as a director, officer, partner, trustee, employee, fiduciary or agent of any other foreign or domestic corporation or other person or entity or of an employee benefit plan, against any and all liabilities and reasonable expenses incurred in connection with any action, suit, or proceeding to which such director is made a party, and which may be asserted against him in such capacity. A director shall be considered to be serving an employee benefit plan at the Company's request if his duties to the Company also impose duties on, or otherwise involve services by, him to the plan or to participants in or beneficiaries of the plan. The Company shall not indemnify a director with respect to conduct not reasonably related to his service to, or as requested by, the Company or with respect to a personal benefit improperly received by him. 2. Officers and Employees. The Company shall indemnify, to the extent and in the manner described herein, any person who serves or who has served at any time as an officer or employee of the Company, and any officer or employee who, at the request of the Company, serves or at any time has served as a director, officer, partner, trustee, employee, fiduciary or agent of any other foreign or domestic corporation or other person or entity or of an employee benefit plan, against any and all liabilities and reasonable expenses incurred in connection with any action, suit or proceeding which is or may be asserted against the officer or employee for acts within the scope of the officer or employee's duties in such capacity, except for matters in which the person shall be adjudged in any action, suit, or proceeding to be liable for his own gross negligence or willful misconduct in the performance of any duty, and except for any personal benefit improperly received by him. 3. Mandatory Indemnification. The Company shall indemnify a director, Officer or employee who was wholly successful, on the merits or otherwise, in the defense of any action, suit or proceeding to which the person was a party because the person is or was a director, officer or

employee, against liabilities and reasonable expenses incurred by him in connection with the action, suit or proceeding. 4. Agents and Fiduciaries. The Company may indemnify a person who serves or who has served at any time as an agent or fiduciary of the Company against liabilities and reasonable expenses incurred in connection with any action, suit, or proceeding to which he is made a party, or which may be asserted against him, by reason of serving in such a capacity, in such circumstances and in such amounts as the Board of Directors shall deem appropriate. 5. Procedure. In each instance in which indemnification is claimed or requested under Section 1 of this Article VI, the Board of Directors shall determine, or shall direct any person or body, as permitted by the Act, to determine (a) whether or not indemnification is permissible in the circumstances, and (b) the amount of liability and expenses with respect to which indemnification should be provided. The responsibility for implementing the indemnification of officers and employees pursuant to Section 2 of this Article VI may be assigned to such officers within the Company as the Board of Directors determines. However, the Board retains its authority to review or consider such matters in appropriate circumstances. 6. Other Remedies. Except as limited by the Act, any indemnification provided herein shall be in addition to any other rights to which those indemnified may be entitled by the Act or pursuant to any agreement, vote of shareholders or otherwise, and shall be available to the heirs, personal representatives and successors of the person entitled to such indemnification. 7. Insurance. The Company may purchase and maintain insurance on behalf of a person who is or was a director, officer, employee, fiduciary, or agent of the Company, or who, while a director, officer, employee, fiduciary, or agent of the Company, is or was serving at the request of the Company as a director, officer, partner, trustee, employee, fiduciary, or agent of another domestic or foreign corporation or other person or entity or of an employee benefit plan, against liability asserted against or incurred by the person in that capacity or arising from his status as a director, officer, employee, fiduciary, or agent, whether or not the Company would have power to indemnify the person against the same liability under the Act. Any such insurance may be procured from any insurance company designated by the Board of Directors, whether such insurance company is formed under the laws of this state or any other jurisdiction of the United States or elsewhere, including any insurance company in which the Company has an equity or any other interest through stock ownership or otherwise. 8. Notice to Shareholders. If the Company indemnifies or advances expenses to a director under this Article in connection with a proceeding by or in the right of the Company, the Company shall give written notice of the indemnification or advance to the shareholders with or before the notice of the next shareholders' meeting. If the next shareholder action is taken without a meeting at the instigation of the Board of Directors, such notice shall be given to the shareholders at or before the time the first shareholder signs a writing consenting to such action. 9. Selection of Counsel. Notwithstanding any other provision of this Article, the Company may condition the right to indemnification of a director, officer or employee on its right to select legal counsel representing such director, officer or employee on the terms of this section 9.

The Company shall have the right to select counsel for any director, officer or employee in any legal action that may give rise to indemnification under this Article VI provided that: (a) the Company consults with the director, officer or employee seeking indemnification with respect to the selection of competent legal counsel; and (b) the Company pays all reasonable fees and costs incurred by the attorney in defending the director, officer or employee (subject to the Company's right to recover such fees and costs if it is determined at the conclusion of the action, suit or proceeding that there is no right of indemnification).

Notwithstanding any other provision of this Article, the Company shall not be responsible for indemnification of any director, officer or employee who declines to use counsel reasonably selected by the Company as provided in this Section 9. Counsel shall be deemed to be reasonably selected by the Company if such counsel is a competent attorney who can independently represent the director, officer or employee consistent with the applicable ethical standards of the Code of Professional Responsibility.

ARTICLE VII

Execution of Instruments; Loans; Checks and Endorsements; Deposits; Proxies

1. Execution of Instruments. Except as otherwise provided by the Board of Directors, the Chairman, the President, any Vice President, the Treasurer or the Secretary shall have the power to execute and deliver on behalf of and in the name of the Company any instrument requiring the signature of an officer of the Company. Unless authorized to do so by these Bylaws or by the Board of Directors, no assistant officer, agent or employee shall have any power or authority to bind the Company in any way, to pledge its credit or to render it liable pecuniarily for any purpose or in any amount. 2. Borrowing. No loan shall be contracted on behalf of the Company, and no evidence of indebtedness shall be issued, endorsed or accepted in its name, unless authorized by the Board of Directors or a committee designated by the Board of Directors so to act. Such authority may be general or confined to specific instances. When so authorized, an officer may (a) effect loans at any time for the Company from any bank or other entity and for such loans may execute and deliver promissory notes or other evidences of indebtedness of the Company; and (b) mortgage, pledge or otherwise encumber any real or personal property, or any interest therein, owned or held by the Company as security for the payment of any loans or obligations of the Company, and to that end may execute and deliver for the Company such instruments as may be necessary or proper in connection with such transaction. 3. Attestation. All signatures authorized by this Article may be attested, when appropriate or required, by any officer of the Company except the officer who signs on behalf of the Company. 4. Loans to Directors, Officers and Employees. The Company may lend money to, guarantee the obligations of, and otherwise assist directors, officers and employees of the Company, or directors of another corporation of which the Company owns a majority of the voting stock, only upon compliance with the requirements of the Act. 5. Checks and Endorsements. All checks, drafts or other orders for the payment of money, obligations, notes or other evidences of indebtedness issued in the name of the Company and other such instruments shall be signed or endorsed for the Company by such officers or agents of the Company as shall from time to time be determined by resolution of the Board of Directors, which resolution may provide for the use of facsimile signatures. 6. Deposits. All funds of the Company not otherwise employed shall be deposited from time to time to the Company's credit in such banks or

other depositories as shall from time to time be determined by resolution of the Board of Directors, which resolution may specify the officers or agents of the Company who shall have the power, and the manner in which such power shall be exercised, to make such deposits and to endorse, assign and deliver for collection and deposit checks, drafts and other orders for the payment of money payable to the Company or its order. 7. Voting of Securities and Other Entities. Unless otherwise provided by resolution of the Board of Directors, the Chairman, Chief Executive Officer, or the President, or any officer designated in writing by any of them, is authorized to attend in person, or may execute written instruments appointing a proxy or proxies to represent the Company, at all meetings of any corporation, partnership, limited liability company, association, joint venture, or other entity in which the Company holds any securities or other interests and may execute written waivers of notice with respect to any such meetings. At all such meetings, any of the foregoing officers, in person or by proxy as aforesaid and subject to the instructions, if any, of the Board of Directors, may vote the securities or interests so held by the Company, may execute any other instruments with respect to such securities or interests, and may exercise any and all rights and powers incident to the ownership of said securities or interests. Any of the foregoing officers may execute one or more written consents to action taken in lieu of a formal meeting of such corporation, partnership, limited liability company, association, joint venture, or other entity.

ARTICLE VIII Shares of Stock

1. Certificates of Stock. The issuance or sale of shares of stock by the Company shall be made only upon authorization by the Board of Directors. Stock certificates shall be in a form designated by the Board of Directors which complies with provisions of the Act. They shall be numbered in the order of their issue and shall be signed by the President or the CEO and by the Secretary or the Treasurer. Facsimile signatures may be used if the certificate is countersigned by a transfer agent. A transfer agent may be an independent third party, the Company itself, or an employee of the Company. The validity of any certificate for shares, otherwise valid, shall not be affected in the event that the delivery of such a certificate occurs after an officer or agent whose signature appears therein is no longer an officer or agent. The stock record books and the blank stock certificate books shall be kept by the Secretary or by any other officer or agent designated by the Board of Directors for that purpose. Notice of any restrictions on the transfer of stock shall be printed or typed on each stock certificate issued by the Company. 2. Shares Without Certificates. The Board of Directors may authorize the issuance of shares of the Company without certificates. Such authorization shall not affect shares already represented by certificates until they are surrendered to the Company. Within a reasonable time following the issue or transfer of shares without certificates, the Company shall send the shareholder a complete written statement of the information that would be required on certificates by the Act. 3. Transfer of Stock. Subject to any transfer restrictions set forth or referred to on the stock certificate or of which the Company otherwise has notice, shares of the Company shall be transferable on the books of the Company upon presentation to the Company or to the Company's transfer agent of a stock certificate signed by, or accompanied by an executed assignment from, the holder of record thereof, his duly authorized legal representative, or other appropriate person as permitted by the Act. The Company may require that any transfer of shares be accompanied by proper evidence reasonably satisfactory to the Company or to the Company's transfer agent that such endorsement is genuine and effective. Upon presentation of shares for transfer as provided above, the payment of all taxes, if any, therefor, and the satisfaction of any other requirement of law, including inquiry into and discharge of any adverse claims of which the Company has notice, the Company shall issue a new certificate to the person entitled thereto and cancel the old certificate. Every transfer of stock shall be entered on the stock books of the Company to accurately reflect the record ownership of each share. The Board of Directors also may make such additional rules and regulations as it may deem expedient concerning the issue, transfer, and registration of certificates for shares of the capital stock of the Company. 4. Restrictions on Transfer. The following provisions shall govern (1) the transferability of all shares of the Class A Common Stock and (2) the transferability of those shares of the Class B Common Stock (non-voting) which were issued in transactions which were not registered with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the "Restricted Class B Shares"): (a) The holder of any such share or shares of Class A Common Stock desiring to sell such stock shall: (i) First offer the shares to the Company and the Company shall have the right and option for a period of 90 days from the date such tender is made to make such purchase. (ii) Then offer such shares, or any remaining shares, to William K. Coors and Joseph Coors, or to the survivor of them if only one of them is then living, and they shall have the right and option for 30 days from the date tender is made to them to make such purchase. They or either of them may elect to exercise the option in whole or in part and in the absence of a contrary agreement between themselves shall participate equally in any such purchase. (iii) The tenders above provided shall in each case be of all and every one of the shares, or of the remaining shares as the case may be, which the offeror desires to sell and the Company, and/or William K. Coors and Joseph Coors, or the survivor of them if only one of them is then living (individually, "the offeree" and collectively, "the offerees") shall successively have the right to purchase all or any of the shares tendered for purchase to it, to him, or to them. (iv) The price to be paid by the offeree or offerees, if the option is exercised in whole or in part, shall be in cash (unless terms are otherwise agreed upon) and shall be the price agreed upon by the offeree or offerees and the offeror, or if there is no such agreement, then the price shall be equal to the market value of the Class B Common Stock (non-voting), i.e., the average of the high and low bid price for the Class B Common Stock on the last business day, prior to the date of such tender, on which said Class B Common Stock was traded. (v) If any shares remain unsold after the tenders provided for in subparagraphs (i) and (ii) above, such remaining shares may, subject to the provisions of subparagraph (vi) below, be sold to third-parties free of the restrictions on transfers set forth in subparagraphs (i) through (iv) above. (vi) If more than six months have elapsed after the date the last said tender was made under the provisions of subparagraph (ii) and such tender was not accepted in whole or in part before a sale to third parties could be consummated under subparagraph (v), the holder of the shares of Class A Common Stock evidenced by the relevant stock certificate must, before again attempting to sell all or any part thereof, comply with the provisions of subparagraphs (i) and (ii) above. (b) Except as provided otherwise in these Bylaws, the sale of any Restricted Class B Shares shall be made in accordance with the following provisions:

(i) The holder of such shares shall offer the shares to the Company, which shall have the right and option for a period of ten days from the date tender is made to make such purchase. (ii) The price to be paid by the Company, if the option is exercised in whole or in part, shall be in cash (unless terms are otherwise agreed upon) and shall be the price agreed upon by the Company and the offeror, or if there is no such agreement, then the price shall be the market value of the stock (i.e., the average of the high and low bid price for the stock) on the last business day, prior to the date of such tender, on which the stock was traded. (iii) If any shares remain unsold after the time provided for in subparagraph (i) above, such remaining shares may, subject to the registration requirements of applicable securities laws or exemptions therefrom, and subject to the provisions of subparagraph (iv) below, be sold to third parties free of the restrictions on transfers contained in these Bylaws. (iv) If more than six months have elapsed after the date the last said tender was made under the provisions of subparagraph (i) and such tender was not accepted in whole or in part before a sale to third parties could be consummated under subparagraph (iii), the holder of such shares must, before again attempting to sell all or any part thereof, comply with the provisions of this section of these Bylaws. (c) The procedures set forth under subparagraph (b) above shall not apply to a transfer by a shareholder when made by his Last Will and Testament; or, in the case of intestacy, when a transfer is effected pursuant to the laws of descent and distribution; or to an inter vivos gift made by such shareholder; provided the recipients of said stock and all persons claiming by, through or under them shall be and remain bound by the provisions of this section of the Bylaws. (d) The restrictions contained herein shall not apply to any shares of Class B Common Stock which have been sold to the public. For the purposes hereof, the term "sold to the public" shall mean the following: (i) Any shares sold in transactions covered by an effective registration statement under the Securities Act of 1933, as amended; and (ii) Any shares sold on the open market or otherwise in transactions relying upon the exemption from registration provided in Section 4(1) of the Securities Act of 1933, as amended, including sales made in conformity with Rule 144 thereunder. 5. Preferred Stock. Shares of preferred stock shall be issued by the Company only after filing the Statement of Designations described in paragraph (d) of Article IV of the Company's Articles of Incorporation with the Colorado Secretary of State and satisfying all other requirements of the Articles of Incorporation and the Act with respect thereto. 6. Holders of Record. The Company shall be entitled to treat the holder of record of any share of stock as the holder in fact thereof and, accordingly, shall not be bound to recognize any equitable or other claim to or interest in such share on the part of any other person, whether or not it shall have express or other notice thereof, except as may be allowed by these Bylaws or required by the laws of Colorado. 7. Shares Held for the Account of a Specified Person or Persons. The Board of Directors, in the manner provided by the Act, may adopt a procedure whereby a shareholder of the Company may certify in writing to the Company that all or a portion of the shares registered in the name of such shareholder are held for the account of a specified person or persons. 8. Lost, Destroyed and Mutilated Certificates. The holder of any stock of the Company shall notify the Company of any loss, destruction, or mutilation of the certificate therefor and the Secretary shall cause a new certificate or certificates to be issued to him upon the surrender of the mutilated certificate or, in case of loss or destruction of the certificate, upon satisfactory proof of such loss or destruction and, in the discretion of the Secretary, the deposit of a bond in such form and amount (not exceeding double the value of the stock represented by such certificate) and with such surety or sureties as the Secretary may require.

ARTICLE IX Dividends and Other Distributions

Subject to the provisions of the Act, dividends and other distributions may be declared by the Board of Directors in such form, frequency and amounts as the condition of the affairs of the Company shall render advisable.

ARTICLE X

Corporate Records

1. Permanent Records. The Company shall keep as permanent records minutes of all meetings of its shareholders and Board of Directors, a record of all actions taken by the shareholders or the Board of Directors without a meeting, a record of all actions taken by a committee of the Board of Directors in place of the Board of Directors on behalf of the Company, and a record of all waivers of notices of meetings of shareholders and of the Board of Directors or any committee of the Board of Directors. 2. Records at Principal Office. The Company shall comply with the provisions of the Act regarding maintenance of records and shall keep the following records at its principal office: (a) its Articles of Incorporation; (b) its Bylaws; (c) the minutes of all shareholders' meetings, and records of all action taken by shareholders without a meeting, for the past three years; (d) all written communications within the past three years to shareholders as a group or to the holders of any class or series of shares as a group; (e) a list of the names and business addresses of its current directors and officers; (f) a copy of its most recent corporate report delivered to the Secretary of state pursuant to the Act; and (g) all financial statements prepared for periods ending during the last three years that a shareholder could have requested pursuant to the Act. 3. Addresses of Shareholders. Each shareholder shall furnish to the Secretary of the Company or the Company's transfer agent an address to which notices from the Company, including notices of meetings, may be directed and if any shareholder shall fail so to designate such an address, it shall be sufficient for any such notice to be directed to such shareholder at such shareholder's address last known to the Secretary or transfer agent. 4. Record of Shareholders. The Secretary shall maintain, or shall cause to be maintained, a record of the names and addresses of the Company's shareholders, in a form that permits preparation of a list of shareholders that is arranged by voting group and, within each voting group, by

class or series of shares, that is alphabetical within each class or series, and that shows the address of, and the number of shares of each class or series held by, each shareholder. 5. Inspection of Corporate Records. Shareholders shall have those rights to receive by mail or to inspect and copy such Company records, pursuant to such procedures, as provided in the Act. 6. Audits of Books and Accounts. The Company's books and accounts may be audited at such times and by such auditors as shall be specified and designated by resolution of the Board of Directors.

ARTICLE XI

Miscellaneous

1. Corporate Seal. The corporate seal shall be in the form approved by resolution of the Board of Directors. Said seal may be used by causing it or a facsimile thereof to be impressed or affixed or in any other manner reproduced. The impression of the seal may be made and attested by either the Secretary or any Assistant Secretary for the authentication of contracts or other papers requiring the seal. 2. Fiscal Year. The fiscal year of the Company shall be as established by the Board of Directors. 3. Emergency Bylaws and Actions. Subject to repeal or change by action of the shareholders, the Board of Directors may adopt emergency bylaws and exercise other powers in accordance with and pursuant to the provisions of the Act. 4. Amendments. The Board of Directors may amend, restate, or repeal the Bylaws or adopt new Bylaws by the affirmative vote of the number of directors constituting two-thirds of the full Board at any annual meeting of the Board or any other meeting called for that purpose. The holder of the Class A Common Stock by affirmative vote also may amend, restate, or repeal the Bylaws or adopt new Bylaws at an annual shareholders meeting or a special meeting called, wholly or in part, for such purpose. The power of the Board of Directors to amend or repeal the Bylaws or to adopt new Bylaws may be limited by the Articles of Incorporation; by adoption of an amendment to the Articles of Incorporation, or by an amendment to the Bylaws adopted by the holder of the Class A Common Stock which reserves such authority in whole or in part to said shareholder with respect to a particular Bylaw. 5. Gender. The masculine gender is used in these Bylaws as a matter of convenience only and shall be interpreted to include the feminine gender as the circumstances indicate. 6. Definitions. Terms not otherwise defined in these Bylaws shall have the meanings set forth in the Act. 7. Conflicts. In the event of any irreconcilable conflict between these Bylaws and either the Articles of Incorporation or the Act, the Articles of Incorporation shall control; provided that, if there is any irreconcilable conflict between the Articles of Incorporation and the Act, then the Act shall control.

The foregoing Bylaws of Adolph Coors Company, consisting of 22 pages, amended and restated as of August 14, 1997, were approved and adopted by the Board of Directors on this 14th day of August 1997.

Secretary

ADOLPH COORS COMPANY EQUITY INCENTIVE PLAN

Amended and restated,

effective February 12, 1998

ADOLPH COORS COMPANY EQUITY INCENTIVE PLAN

Amended and restated,

effective February 12, 1998

Section 1

TABLE OF CONTENTS Page Section 1 Introduction 1 1.1 Establishment and Amendment 1 1.2 Purposes 1 1.3 Effective Date 1 Section 2 Definitions 1 2.1 Definitions 1 2.2 Gender and Number 2 Section 3 Plan Administration 2 3.1 General 2 3.2 Claims 3 Section 4 Stock Subject to the Plan 3 4.1 Number of Shares 3 4.2 Other Shares of Stock 3 4.3 Adjustments for Stock Split, Stock Divide nd, Etc 3 4.4 Other Distributions and Changes in the St ock 4 4.5 General Adjustment Rules 4 4.6 Determination by the Committee, Etc 4 Section 5 Reorganization or Liquidation 4 Section 6 Participation 5 6.1 In General 5 6.2 Restriction on Award Grants to Certain In dividuals 5 6.3 General Restrictions on Awards 5 Section 7 Stock Options 5 7.1 Grant of Stock Options 5 7.2 Stock Option Certificates 5 7.3 Shareholder Privileges 8 Section 8 Restricted Stock Awards 8 8.1 Grant of Restricted Stock Awards 8 8.2 Restrictions 8 8.3 Privileges of a Stockholder, Transferabil ity 8 8.4 Enforcement of Restrictions 8 Section 9 Purchase of Stock 9 9.1 General 9 9.2 Other Terms 9 Section 10 Other Common Stock Grants 9 Section 11 Company Right To Purchase Stock 9 11.1 Right of First Refusal 9 11.2 Marking of Certificates 10 Section 12 Change in Control 10 12.1 In General 10 12.2 Limitation on Payments 10 Section 13 Rights of Employees; Participants 11 13.1 Employment 11 13.2 Nontransferability 11 Section 14 General Restrictions 11 14.1 Investment Representations 11 14.2 Compliance with Securities Laws 11 14.3 Changes in Accounting Rules 11 Section 15 Other Employee Benefits 12 Section 16 Plan Amendment, Modification and Termin ation 12 Section 17 Withholding 12 17.1 Withholding Requirement 12 17.2 Withholding With Stock 12 Section 18 Requirements of Law 12 18.1 Requirements of Law 12 18.2 Federal Securities Law Requirements 12 18.3 Governing Law 13 Section 19 Duration of the Plan 13

Introduction

1.1 Establishment and Amendment. Adolph Coors Company, a Colorado corporation (hereinafter referred to, together with its Affiliated Corporations (as defined in subsection 2.1(a)) as the "Company" except where the context otherwise requires), established the Adolph Coors Company Equity Incentive Plan (the "Plan") for certain key employees of the Company. The Plan, which permits the grant of stock options and restricted stock awards to certain key employees of the Company, was originally effective January 1, 1990. Pursuant to the power granted in Section 16, the Company hereby amends and restates the Plan in its entirety, effective February 12, 1998, provided, however, that the amendment to Section 4.1 increasing the number of shares of Stock subject to the Plan is effective November 19, 1997. 1.2 Purposes. The purposes of the Plan are to provide the key management employees selected for participation in the Plan with added incentives to continue in the service of the Company and to create in such employees a more direct interest in the future success of the operations of the Company by relating incentive compensation to the achievement of long-term corporate economic objectives, so that the income of the key management employees is more closely aligned with the income of the Company's shareholders. The Plan is also designed to attract key employees and to retain and motivate participating employees by providing an opportunity for investment in the Company. 1.3 Effective Date. The original effective date of the Plan (the "Effective Date") was January 1, 1990. The Plan, each amendment to the Plan, and each option or other award granted hereunder is conditioned on and shall be of no force or effect until approval of the Plan by the holders of the shares of voting stock of the Company unless the Company, on the advice of counsel, determines that shareholder approval is not necessary.

Section 2

Definitions

2.1 Definitions. The following terms shall have the meanings set forth below: (a) "Affiliated Corporation" means any corporation or other entity (including but not limited to a partnership) which is affiliated with Adolph Coors Company through stock ownership or otherwise and is treated as a common employer under the provisions of Sections 414(b) and (c) of the Internal Revenue Code. (b) "Award" means an Option or a Restricted Stock Award issued hereunder, an offer to purchase Stock made hereunder, or a grant of Stock made hereunder. (c) "Board" means the Board of Directors of the Company. (d) "Committee" means a committee consisting of members of the Board who are empowered hereunder to take actions in the administration of the Plan. The Committee shall be so constituted at all times as to permit the Plan to comply with Rule 16b-3 or any successor rule promulgated under the Securities Exchange Act of 1934 (the "1934 Act"). Members of the Committee shall be appointed from time to time by the Board, shall serve at the pleasure of the Board and may resign at any time upon written notice to the Board. (e) "Effective Date" means the original effective date of the Plan, January 1, 1990. (f) "Eligible Employees" means those key management employees (including, without limitation, officers and directors who are also employees) of the Company or any division thereof, upon whose judgment, initiative and efforts the Company is, or will become, largely dependent for the successful conduct of their business. (g) "Fair Market Value" means the average of the highest and lowest prices of the Stock as reported on the National Association of Securities Dealers Automated Quotation System ("NASDAQ") on a particular date. If there are no Stock transactions on such date, the Fair Market Value shall be determined as of the immediately preceding date on which there were Stock transactions. If the price of the Stock is not reported on NASDAQ, the Fair Market Value of the Stock on the particular date shall be as determined by the Committee using a reference comparable to the NASDAQ system. If, upon exercise of an Option, the exercise price is paid by a broker's transaction as provided in section 7.2(g)(ii)(D), Fair Market Value, for purposes of the exercise, shall be the price at which the Stock is sold by the broker. (h) "Internal Revenue Code" means the Internal Revenue Code of 1986, as it may be amended from time to time. (i) "Option" means a right to purchase Stock at a stated price for a specified period of time. All Options granted under the Plan shall be "non-qualified stock options" whose grant is not intended to fall under the provisions of Section 422A of the Internal Revenue Code. (j) "Option Price" means the price at which shares of Stock subject to an Option may be purchased, determined in accordance with subsection 7.2(b). (k) "Participant" means an Eligible Employee designated by the Committee from time to time during the term of the Plan to receive one or more of the Awards provided under the Plan. (l) "Restricted Stock Award" means an award of Stock granted to a Participant pursuant to Section 8 that is subject to certain restrictions imposed in accordance with the provisions of such Section. (m) "Stock" means the no par value Class B (non- voting) Common Stock of the Company. (n) "Voting Stock" means the $1.00 par value Class A Common Stock of the Company. 2.2 Gender and Number. Except when otherwise indicated by the context, the masculine gender shall also include the feminine gender, and the definition of any term herein in the singular shall also include the plural.

Section 3

Plan AdministrationAdministration

3.1 General. The Plan shall be administered by the Committee. In accordance with the provisions of the Plan, the Committee shall, in its sole discretion, select the Participants from among the Eligible Employees, determine the Options, Restricted Stock Awards and other Awards to be granted pursuant to the Plan, the number of shares of Stock to be issued thereunder and the time at which such Options and Restricted Stock Awards are to be granted, fix the Option Price, period and manner in which an Option becomes exercisable, establish the duration and nature of Restricted Stock Award restrictions, establish the terms and conditions on which an offer to purchase Stock will be made, and establish such

other terms and requirements of the various compensation incentives under the Plan as the Committee may deem necessary or desirable and consistent with the terms of the Plan. The Committee shall determine the form or forms of the agreements with Participants which shall evidence the particular provisions, terms, conditions, rights and duties of the Company and the Participants with respect to Awards granted pursuant to the Plan, which provisions need not be identical except as may be provided herein. The Committee may from time to time adopt such rules and regulations for carrying out the purposes of the Plan as it may deem proper and in the best interests of the Company. The Committee may correct any defect, supply any omission or reconcile any inconsistency in the Plan or in any agreement entered into hereunder in the manner and to the extent it shall deem expedient and it shall be the sole and final judge of such expediency. No member of the Committee shall be liable for any action or determination made in good faith. The determinations, interpretations and other actions of the Committee pursuant to the provisions of the Plan shall be binding and conclusive for all purposes and on all persons. 3.2 Claims. (a) A Participant who wishes to appeal any determination of the Committee concerning an Award granted pursuant to the Plan shall notify the Committee in a writing, which shall state the basis for the appeal. The appeal shall be filed with the Committee within 30 days after the date the Participant received the notice from the Committee. The written appeal may be filed by the Participant's authorized representative. The Committee shall review the appeal and issue its decision within 90 days after it receives the Participant's appeal. If the Committee needs additional time to review the appeal, it shall notify the Participant in writing and specify when it expects to render its decision. After completion of its review, the Committee shall notify the Participant of its decision in writing, which shall state the reasons for the Committee's decision. (b) If, after the completion of the procedure set forth in the preceding paragraph, the Participant wishes to further pursue the appeal, the appeal shall be submitted to, and determined through, binding arbitration in Denver, Colorado in accordance with the arbitration procedures of the American Arbitration Association ("AAA") existing at the time the arbitration is conducted, before a single arbitrator chosen in accordance with AAA procedures. The decision of the arbitrator shall be enforceable as a court judgment.

Section 4

Stock Subject to the Plan

4.1 Number of Shares. Eight Million (8,000,000) shares of Stock are authorized for issuance under the Plan in accordance with the provisions of the Plan and subject to such restrictions or other provisions as the Committee may from time to time deem necessary. This authorization may be increased from time to time by approval of the Board and by the shareholders of the Company if, in the opinion of counsel for the Company, such shareholder approval is required. Shares of Stock that may be issued upon exercise of Options, that are issued as Restricted Stock Awards, that are purchased under the Plan, and that are used as incentive compensation under the Plan shall be applied to reduce the maximum number of shares of Stock remaining available for use under the Plan. The Company shall at all times during the term of the Plan and while any Options are outstanding retain as authorized and unissued Stock at least the number of shares from time to time required under the provisions of the Plan, or otherwise assure itself of its ability to perform its obligations hereunder. 4.2 Other Shares of Stock. Any shares of Stock that are subject to an Option that expires or for any reason is terminated unexercised, any shares of Stock that are subject to an Award (other than an Option) and that are forfeited, any shares of Stock withheld for the payment of taxes or received by the Company as payment of the exercise price of an Option and any shares of Stock that for any other reason are not issued to an Eligible Employee or are forfeited shall automatically become available for use under the Plan. However, any shares of Stock that are subject to an Award (other than an Option) and that are forfeited and any shares of Stock that are withheld for the payment of taxes or received by the Company as payment of the exercise price of an Option shall be available for use under the Plan. 4.3 Adjustments for Stock Split, Stock Dividend, Etc. If the Company shall at any time increase or decrease the number of its outstanding shares of Stock or change in any way the rights and privileges of such shares by means of the payment of a stock dividend or any other distribution upon such shares payable in Stock, or through a stock split, subdivision, consolidation, combination, reclassification or recapitalization involving the Stock, then in relation to the Stock that is affected by one or more of the above events, the numbers, rights and privileges of the following shall be increased, decreased or changed in like manner as if they had been issued and outstanding, fully paid and nonassessable at the time of such occurrence: (i) the shares of Stock as to which Awards may be granted under the Plan; and (ii) the shares of the Stock then included in each outstanding Award granted hereunder. 4.4 Other Distributions and Changes in the Stock. If (a) the Company shall at any time distribute with respect to the Stock assets or securities of persons other than the Company (excluding cash or distributions referred to in Section 4.3), (b) the Company shall at any time grant to the holders of its Stock rights to subscribe pro rata for additional shares thereof or for any other securities of the Company, or (c) there shall be any other change (except as described in Section 4.3), in the number or kind of outstanding shares of Stock or of any stock or other securities into which the Stock shall be changed or for which it shall have been exchanged,and if the Committee shall in its discretion determine that the event described in subsection (a), (b), or (c) above equitably requires an adjustment in the number or kind of shares subject to an Option or other Award, an adjustment in the Option Price or the taking of any other action by the Committee, including without limitation, the setting aside of any property for delivery to the Participant upon the exercise of an Option or the full vesting of an Award, then such adjustments shall be made, or other action shall be taken, by the Committee and shall be effective for all purposes of the Plan and on each outstanding Option or Award that involves the particular type of stock for which a change was effected. Notwithstanding the foregoing provisions of this Section 4.4, pursuant to Section 8.3 below, a Participant holding Stock received as a Restricted Stock Award shall have the right to receive all amounts, including cash and property of any kind, distributed with respect to the Stock upon the Participant's becoming a holder of record of the Stock. 4.5 General Adjustment Rules. No adjustment or substitution provided for in this Section 4 shall require the Company to sell a fractional share of Stock under any Option, or otherwise issue a fractional share of Stock, and the total substitution or adjustment with respect to each Option and other Award shall be limited by deleting any fractional share. In the case of any such substitution or adjustment, the total Option Price for

the shares of Stock then subject to the Option shall remain unchanged but the Option Price per share under each such Option shall be equitably adjusted by the Committee to reflect the greater or lesser number of shares of Stock or other securities into which the Stock subject to the Option may have been changed, and appropriate adjustments shall be made to Restricted Stock Awards to reflect any such substitution or adjustment. 4.6 Determination by the Committee, Etc. Adjustments under this Section 4 shall be made by the Committee, whose determinations with regard thereto shall be final and binding upon all parties thereto.

Section 5

Reorganization or Liquidation

If the Company is merged or consolidated with another corporation and the Company is not the surviving corporation, or if all or substantially all of the assets or more than 50% of the outstanding voting stock of the Company is acquired by any other corporation, business entity or person, or in case of a reorganization (other than a reorganization under the United States Bankruptcy Code), including a divisive reorganization under Section 355 of the Code, or liquidation of the Company, and if the provisions of Section 12 do not apply, the Committee, or the board of directors of any corporation assuming the obligations of the Company, shall, as to the Plan and outstanding Options and other Awards, either (i) make appropriate provision for the adoption and continuation of the Plan by the acquiring or successor corporation and for the protection of any such outstanding Options and other Awards by the substitution on an equitable basis of appropriate stock of the Company or of the merged, consolidated or otherwise reorganized corporation that will be issuable with respect to the Stock, provided that no additional benefits shall be conferred upon the Participants holding such Options and other Awards as a result of such substitution, and the excess of the aggregate Fair Market Value of the shares subject to the Options immediately after such substitution over the Option Price thereof is not more than the excess of the aggregate Fair Market Value of the shares subject to such Options immediately before such substitution over the Option Price thereof, or (ii) upon written notice to the Participants, provide that all unexercised Options must be exercised within a specified number of days of the date of such notice or they will be terminated. In the latter event, the Committee shall accelerate the exercise dates of outstanding Options and accelerate the restriction period and modify the performance requirements for any outstanding Awards so that all Options and other Awards become fully vested prior to any such event.

Section 6

Participation

6.1 In General. Participants in the Plan shall be those Eligible Employees who, in the judgment of the Committee, are performing, or during the term of their incentive arrangement will perform, vital services in the management, operation and development of the Company or an Affiliated Corporation, and significantly contribute, or are expected to significantly contribute, to the achievement of long- term corporate economic objectives. Participants may be granted from time to time one or more Awards; provided, however, that the grant of each such Award shall be separately approved by the Committee, and receipt of one such Award shall not result in automatic receipt of any other Award. Upon determination by the Committee that an Award is to be granted to a Participant, written notice shall be given to such person, specifying the terms, conditions, rights and duties related thereto. Each Participant shall, if required by the Committee, enter into an agreement with the Company, in such form as the Committee shall determine and that is consistent with the provisions of the Plan, specifying such terms, conditions, rights and duties. Awards shall be deemed to be granted as of the date specified in the grant resolution of the Committee, which date shall be the date of any related agreement with the Participant. In the event of any inconsistency between the provisions of the Plan and any such agreement entered into hereunder, the provisions of the Plan shall govern. 6.2 Restriction on Award Grants to Certain Individuals. Notwithstanding the foregoing provisions of Section 6.1, no Awards shall be granted to any lineal descendant of Adolph Coors, Jr. without the prior written approval of counsel to the Company as to the effect of any such grant on the possible status of the Company as a "personal holding company" within the meaning of Section 542 of the Internal Revenue Code. 6.3 General Restrictions on Awards. Awards covering no more than 1,000,000 shares of Stock may be granted to any Participant under this Plan during the term of this Plan.

Section 7

Stock OptionsOptions

7.1 Grant of Stock Options. Coincident with or following designation for participation in the Plan, a Participant may be granted one or more Options. In no event shall the exercise of one Option affect the right to exercise any other Option or affect the number of shares of Stock for which any other Option may be exercised, except as provided in subsection 7.2(j). 7.2 Stock Option Certificates. Each Option granted under the Plan shall be evidenced by a written stock option certificate. A stock option certificate shall be issued by the Company in the name of the Participant to whom the Option is granted (the "Option Holder") and shall incorporate and conform to the conditions set forth in this Section 7.2, as well as such other terms and conditions, not inconsistent herewith, as the Committee may consider appropriate in each case. (a) Number of Shares. Each stock option agreement shall state that it covers a specified number of shares of the Stock, as determined by the Committee. (b) Price. The price at which each share of Stock covered by an Option may be purchased shall be determined in each case by the Committee and set forth in the stock option certificate. (c) Duration of Options; Restrictions on Exercise. Each stock option agreement shall state the period of time, determined by the Committee, within which the Option may be exercised by the Option Holder (the "Option Period"), and shall also set forth any installment or other

restrictions on Option exercise during such period, if any, as may be determined by the Committee. (d) Termination of Employment, Death, Disability, Etc. Each stock option agreement shall provide as follows with respect to the exercise of the Option upon termination of the employment or the death of the Option Holder: (i) If the employment of the Option Holder is terminated within the Option Period for cause, as determined by the Company, the Option shall thereafter be void for all purposes. As used in this subsection 7.2(d), "cause" shall mean a gross violation, as determined by the Company, of the Company's established policies and procedures, provided that the effect of this subsection 7.2(d) shall be limited to determining the consequences of a termination and that nothing in this subsection 7.2(d) shall restrict or otherwise interfere with the Company's discretion with respect to the termination of any employee. (ii) If the Option Holder retires from employment by the Company or its affiliates during the Option Period pursuant to the Company's retirement policy, or if the Option Holder becomes disabled (as determined pursuant to the Company's Long-Term Disability Plan), the Option may be exercised by the Option Holder, or in the case of death by the persons specified in subsection (iii) of this subsection 7.2(d), within thirty-six months following his or her retirement or disability (provided that such exercise must occur within the Option Period), but not thereafter. In any such case, the Option may be exercised only as to the shares as to which the Option had become exercisable on or before the date of the Option Holder's termination of employment. (iii) If the Option Holder dies during the Option Period while still employed or within the three-month period referred to in (iv) below, or within the thirty-six-month period referred to in (ii) above, the Option may be exercised by those entitled to do so under the Option Holder's will or by the laws of descent and distribution within fifteen months following the Option Holder's death, (provided that such exercise must occur within the Option Period), but not thereafter. In any such case, the Option may be exercised only as to the shares as to which the Option had become exercisable on or before the date of the Option Holder's death. (iv) If the employment of the Option Holder by the Company is terminated (which for this purpose means that the Option Holder is no longer employed by the Company or by an Affiliated Corporation) within the Option Period for any reason other than cause, retirement pursuant to the Company's retirement policy, disability or the Option Holder's death, the Option may be exercised by the Option Holder within three months following the date of such termination (provided that such exercise must occur within the Option Period), but not thereafter. In any such case, the Option may be exercised only as to the shares as to which the Option had become exercisable on or before the date of termination of employment. (e) Transferability. Each stock option agreement shall provide that the Option granted therein is not transferable by the Option Holder except by will or pursuant to the laws of descent and distribution, and that such Option is exercisable during the Option Holder's lifetime only by him or her, or in the event of disability or incapacity, by his or her guardian or legal representative. (f) Agreement to Continue in Employment. Each stock option agreement shall contain the Option Holder's agreement to remain in the employment of the Company, at the pleasure of the Company, for a continuous period of at least one year after the date of such stock option agreement, at the salary rate in effect on the date of such agreement or at such changed rate as may be fixed, from time to time, by the Company. (g) Exercise, Payments, Etc. (i) Each stock option agreement shall provide that the method for exercising the Option granted therein shall be by delivery to the Corporate Secretary of the Company of written notice specifying the number of shares with respect to which such Option is exercised and payment of the Option Price. Such notice shall be in a form satisfactory to the Committee and shall specify the particular Option (or portion thereof) which is being exercised and the number of shares with respect to which the Option is being exercised. The exercise of the Stock Option shall be deemed effective upon receipt of such notice by the Corporate Secretary and payment to the Company. If requested by the Company, such notice shall contain the Option Holder's representation that he or she is purchasing the Stock for investment purposes only and his or her agreement not to sell any Stock so purchased in any manner that is in violation of the Securities Act of 1933, as amended, or any applicable state law. Such restrictions, or notice thereof, shall be placed on the certificates representing the Stock so purchased. The purchase of such Stock shall take place at the principal offices of the Company upon delivery of such notice, at which time the purchase price of the Stock shall be paid in full by any of the methods or any combination of the methods set forth in (ii) below. A properly executed certificate or certificates representing the Stock shall be issued by the Company and delivered to the Option Holder. If certificates representing Stock are used to pay all or part of the exercise price, separate certificates for the same number of shares of Stock shall be issued by the Company and delivered to the Option Holder representing each certificate used to pay the Option Price, and an additional certificate shall be issued by the Company and delivered to the Option Holder representing the additional shares, in excess of the Option Price, to which the Option Holder is entitled as a result of the exercise of the Option (the "Additional Shares"). Notwithstanding the foregoing, if a Participant has validly elected, in accordance with the provisions of the Adolph Coors Company Deferred Compensation Plan, or any successor plan, to defer the receipt of such Additional Shares, then such Additional Shares shall be issued and delivered to the trustee of the trust formed pursuant to the provisions of such Deferred Compensation Plan, or otherwise deferred in accordance with the provisions of such Deferred Compensation Plan, and the rights of the Participant with respect to such Additional Shares shall be determined in accordance with the provisions of the Deferred Compensation Plan. (ii) The exercise price shall be paid by any of the following methods or any combination of the following methods:

(A) in cash;

(B) by certified or cashier's check payable

to the order of the Company; (C) by delivery to the Company of certificates representing the number of shares then owned by the Option Holder, the Fair Market Value of which equals the purchase price of the Stock purchased pursuant to the Option, properly endorsed for transfer to the Company; provided however, that no Option may be exercised by delivery to the Company of certificates representing Stock, unless such Stock has been held by the Option Holder for more than six months; for purposes of this Plan, the Fair Market Value of any shares of Stock delivered in payment of the purchase price upon exercise of the Option shall be the Fair Market Value as of the exercise date; the exercise date shall be the day of delivery of the certificates for the Stock used as payment of the Option Price; or (D) by delivery to the Company of a properly executed notice of exercise together with irrevocable instructions to a broker to deliver to the Company promptly the amount of the proceeds of the sale of all or a portion of the Stock or of a loan from the broker to the Option Holder necessary to pay the exercise price.

(h) Date of Grant. An option shall be considered as having been granted on the date specified in the grant resolution of the Committee. (i) Notice of Sale of Stock; Withholding. Each stock option agreement shall provide that, upon exercise of the Option, the Option Holder shall make appropriate arrangements with the Company to provide for the amount of additional withholding required by Sections 3102 and 3402 of the Internal Revenue Code and applicable state income tax laws, including payment of such taxes through delivery of shares of Stock or by withholding Stock to be issued under the Option, as provided in Section 17. (j) Issuance of Additional Option. If an Option Holder pays all or any portion of the exercise price of an Option with Stock, or pays all or any portion of the applicable withholding taxes with respect to the exercise of an Option with Stock which has been held by the Option Holder for more than six months, the Committee shall grant to such Option Holder a new Option covering the number of shares of Stock used to pay such exercise price and/or withholding tax. The new Option shall have an Option Price per share equal to the Fair Market Value of a share of Stock on the date of the exercise of the Option and shall have the same terms and provisions as the Option, except as otherwise determined by the Committee in its sole discretion. Effective for Options granted on and after January 1, 1994, this section 7.2(j) shall be null and void. 7.3 Shareholder Privileges. No Option Holder shall have any rights as a shareholder with respect to any shares of Stock covered by an Option until the Option Holder becomes the holder of record of such Stock, and no adjustments shall be made for dividends or other distributions or other rights as to which there is a record date preceding the date such Option Holder becomes the holder of record of such Stock, except as provided in Section 4.

Section 8

Restricted Stock Awards

8.1 Grant of Restricted Stock Awards. Coincident with or following designation for participation in the Plan, the Committee may grant a Participant one or more Restricted Stock Awards consisting of shares of Stock. The number of shares granted as a Restricted Stock Award shall be determined by the Committee. 8.2 Restrictions. A Participant's right to retain a Restricted Stock Award granted to him under Section 8.1 shall be subject to such restrictions, including but not limited to his continuous employment by the Company or an Affiliated Corporation for a restriction period specified by the Committee or the attainment of specified performance goals and objectives, as may be established by the Committee with respect to such Award. The Committee may in its sole discretion require different periods of employment or different performance goals and objectives with respect to different Participants, to different Restricted Stock Awards or to separate, designated portions of the Stock shares constituting a Restricted Stock Award. In the event of the death or disability (as defined in subsection 7.2(d)) of a Participant, or the retirement of a Participant in accordance with the Company's established retirement policy, all employment period and other restrictions applicable to Restricted Stock Awards then held by him shall lapse with respect to a pro rata part of each such Award based on the ratio between the number of full months of employment completed at the time of termination of employment from the grant of each Award to the total number of months of employment required for such Award to be fully nonforfeitable, and such portion of each such Award shall become fully nonforfeitable. The remaining portion of each such Award shall be forfeited and shall be immediately returned to the Company. In the event of a Participant's termination of employment for any other reason, any Restricted Stock Awards as to which the employment period or other restrictions have not been satisfied (or waived or accelerated as provided herein) shall be forfeited, and all shares of Stock related thereto shall be immediately returned to the Company. 8.3 Privileges of a Stockholder, Transferability. A Participant shall have all voting, dividend, liquidation and other rights with respect to Stock in accordance with its terms received by him as a Restricted Stock Award under this Section 8 upon his becoming the holder of record of such Stock; provided, however, that the Participant's right to sell, encumber, or otherwise transfer such Stock shall be subject to the limitations of Sections 9 and 11.2. 8.4 Enforcement of Restrictions. The Committee shall cause a legend to be placed on the Stock certificates issued pursuant to each Restricted Stock Award referring to the restrictions provided by Sections 8.2 and 8.3 and, in addition, may in its sole discretion require one or more of the following methods of enforcing the restrictions referred to in Sections 8.2 and 8.3: (a) Requiring the Participant to keep the Stock certificates, duly endorsed, in the custody of the Company while the restrictions remain in effect; or (b) Requiring that the Stock certificates, duly endorsed, be held in the custody of a third party while the restrictions remain in effect.

Section 9

Purchase of Stock

9.1 General. From time to time the Company may make an offer to certain Participants, designated by the Committee in its sole discretion, to purchase Stock from the Company. The number of shares of Stock offered by the Company to each selected Participant shall be determined by the Committee in its sole discretion. The purchase price for the Stock shall be as determined by the Committee in its sole discretion and may be less than the Fair Market Value of the Stock. The Participants who accept the Company's offer shall purchase the Stock at the time designated by the Committee. The purchase shall be on such additional terms and conditions as may be determined by the Committee in its sole discretion. 9.2 Other Terms. The Committee may, in its sole discretion, grant Options, Restricted Stock, or any combination thereof, on terms and conditions determined by the Committee, in its sole discretion, to the Participants who purchase Stock pursuant to Section 9.1.

Section 10

Other Common Stock Grants

From time to time during the duration of this Plan, the Board may, in its sole discretion, adopt one or more incentive compensation arrangements for Participants pursuant to which the Participants may acquire shares of Stock, whether by purchase, outright grants, or otherwise. Any such arrangements shall be subject to the general provisions of this Plan and all shares of Stock issued pursuant to such arrangements shall be issued under this Plan.

Section 11

Company Right To Purchase Stock

11.1 Right of First Refusal. (a) In the event of the death of a Participant, or if a Participant at any time proposes to transfer any of the Stock acquired pursuant to the Plan to a third party, the Participant (or his personal representative or estate, as the case may be) shall make a written offer (the "Offer") to sell all of the Stock acquired pursuant to the Plan then owned by the Participant (or thereafter acquired by the Participant's estate or personal representative pursuant to any Award hereunder) to the Company at the "purchase price" as hereinafter defined. In the case of a proposed sale of any of the Stock to a third party, the Offer shall state the name of the proposed transferee and the terms and conditions of the proposed transfer. In a case of a proposed sale through or to a registered broker/dealer, the Offer shall state the name and address of the broker. The Company shall have the right to elect to purchase all (but not less than all) of the shares of Stock. The Company shall have the right to elect to purchase the shares of Stock for a period of ten (10) days after the receipt by the Company of the Offer. The provisions of this Section 11 shall apply to proposed sales through or to a registered broker/dealer at the prevailing market price, even if the prevailing market price should fluctuate between the date the Company receives the Offer and the date the Company elects to purchase the shares of Stock. In all cases, the purchase price for the Stock shall be determined pursuant to subsection 11.1(d). (b) The Company shall exercise its right to purchase the Stock by given written notice of its exercise to the Participant (or his personal representative or estate, as the case may be). If the Company elects to purchase the Stock, payment for the shares of Stock shall be made in full by Company check. Any such payments shall be made within ten (10) days after the election to purchase has been exercised. (c) If the Stock is not purchased pursuant to the foregoing provisions, the shares of Stock may be transferred by the Participant to the proposed transferee named in the Offer to the Company, in the case of a proposed sale to a third party. However, if such transfer is not made within 120 days following the termination of the Company's right to purchase, a new offer must be made to the Company before the Participant can transfer any portion of his shares and the provisions of this Section 11 shall again apply to such transfer. If the Company's right of first refusal under this Section 11 is created by an event other than a proposed transfer to a third party, the shares of Stock shall remain subject to the provisions of this Section 11 in the hands of the registered owner of the Stock. (d) The purchase price for each share of Stock purchased by the Company pursuant to this Section 11 shall be equal to the Fair Market Value of the Stock on the date the Company receives the Offer under subsection 11.1(a). 11.2 Marking of Certificates. Each certificate representing shares of Stock acquired pursuant to this Plan shall bear the following legend:

The shares of stock represented by this Certificate are subject to all the terms of the Adolph Coors Company Equity Incentive Plan, as the Plan may be amended from time to time (the "Plan") and to the terms of a [Non-Qualified Stock Option Agreement] [Restricted Stock Agreement] [Stock Purchase Agreement] between the Company and the Participant (the "Agreement"). Copies of the Plan and the Agreement are on file at the office of the Company. The Plan and the Agreement, among other things, limit the right of the Owner to transfer the shares represented hereby and provides that in certain circumstances the shares may be purchased by the Company.

Section 12

Change in Control

12.1 In General. In the event of a change in control of the Company as defined in Section 12.3, then (a)all Options shall become immediately exercisable in full during the remaining term thereof, and shall remain so, whether or not the Participants to whom such Options have been granted remain employees of the Company or an Affiliated Corporation; and (b)all restrictions with respect to outstanding Restricted Stock Awards shall immediately lapse. 12.2 Limitation on Payments. If the provisions of this Section 12 would result in the receipt by any Participant of a payment within the meaning of Section 280G of the Internal Revenue Code and the regulations promulgated thereunder and if the receipt of such payment by any Participant would, in the opinion of independent tax counsel of recognized standing selected by the Company, result in the payment by such Participant of any excise tax provided for in Sections 280G and 4999 of the Internal Revenue Code, then the amount of such payment shall be reduced to the extent required, in the opinion of independent tax counsel, to prevent the imposition of such excise tax; provided, however, that the Committee, in its sole discretion, may authorize the payment of all or any portion of the amount of such reduction to the Participant. 12.3 Definition. For purposes of the Plan, a "change in control" shall mean any of the following: (i) The acquisition of or the ownership of fifty percent or more of the total Voting Stock of the Company then issued and outstanding, by any person, or group of affiliated persons, or entities not affiliated with the Company as of the Effective Date of this Plan, without the consent of the Board of Directors, or (ii) The election of individuals constituting a majority of the Board of Directors who were not either (A) members of the Board of Directors prior to the election or (B) recommended to the shareholders by management of the Company, or (iii) A legally binding and final vote of the shareholders of the Company in favor of selling all or substantially all of the assets of the Company.

Section 13

Rights of Employees; Participants

13.1 Employment. Nothing contained in the Plan or in any Option or Restricted Stock Award granted under the Plan shall confer upon any Participant any right with respect to the continuation of his or her employment by the Company or any Affiliated Corporation, or interfere in any way with the right of the Company or any Affiliated Corporation, subject to the terms of any separate employment agreement to the contrary, at any time to terminate such employment or to increase or decrease the compensation of the Participant from the rate in existence at the time of the grant of an Option or Restricted Stock Award. Whether an authorized leave of absence, or absence in military or government service, shall constitute a termination of employment shall be determined by the Committee at the time. 13.2 Nontransferability. No right or interest of any Participant in an Option or a Restricted Stock Award (prior to the completion of the restriction period applicable thereto), granted pursuant to the Plan, shall be assignable or transferable during the lifetime of the Participant, either voluntarily or involuntarily, or subjected to any lien, directly or indirectly, by operation of law, or otherwise, including execution, levy, garnishment, attachment, pledge or bankruptcy. In the event of a Participant's death, a Participant's rights and interests in Options and Restricted Stock Awards shall, to the extent provided in Sections 7, 8 and 9, be transferable by testamentary will or the laws of descent and distribution, and payment of any amounts due under the Plan shall be made to, and exercise of any Options may be made by, the Participant's legal representatives, heirs or legatees. If in the opinion of the Committee a person entitled to payments or to exercise rights with respect to the Plan is disabled from caring for his affairs because of mental condition, physical condition or age, payment due such person may be made to, and such rights shall be exercised by, such person's guardian, conservator or other legal personal representative upon furnishing the Committee with evidence satisfactory to the Committee of such status.

Section 14

General Restrictions

14.1 Investment Representations. The Company may require any person to whom an Option, Restricted Stock Award, Stock is granted, or to whom Stock is sold, as a condition of exercising such Option or receiving such Restricted Stock Award or Stock, or purchasing such Stock, to give written assurances in substance and form satisfactory to the Company and its counsel to the effect that such person is acquiring the Stock subject to the Option, Restricted Stock Award, Stock grant, or purchase of Stock, for his own account for investment and not with any present intention of selling or otherwise distributing the same, and to such other effects as the Company deems necessary or appropriate in order to comply with Federal and applicable state securities laws. 14.2 Compliance with Securities Laws. Each Option and Restricted Stock Award, and Stock grant or purchase shall be subject to the requirement that, if at any time counsel to the Company shall determine that the listing, registration or qualification of the shares subject to such Option, Restricted Stock Award, Stock grant or purchase upon any securities exchange or under any state or federal law, or the consent or approval of any governmental or regulatory body, is necessary as a condition of, or in connection with, the issuance or purchase of shares thereunder, such Option, Restricted Stock Award, or Stock grant or purchase may not be accepted or exercised in whole or in part unless such listing, registration, qualification, consent or approval shall have been effected or obtained on conditions acceptable to the Committee. Nothing herein shall be deemed to require the Company to apply for or to obtain such listing, registration or qualification. 14.3 Changes in Accounting Rules. Notwithstanding any other provision of the Plan to the contrary, if, during the term of the Plan, any changes in the financial or tax accounting rules applicable to Options or Restricted Stock Awards shall occur that, in the sole judgment of the Committee, may have a material adverse effect on the reported earnings, assets or liabilities of the Company, the Committee shall have the right and power to modify as necessary, any then outstanding and unexercised Options and outstanding Restricted Stock Awards as to which the applicable employment or other restrictions have not been satisfied.

Section 15

Other Employee Benefits

The amount of any compensation deemed to be received by a Participant as a result of the exercise of an Option, the sale of shares received upon such exercise, the vesting of any Restricted Stock Award, or the purchase or grant of Stock, shall not constitute "earnings" with respect to which any other employee benefits of such employee are determined, including without limitation benefits under any pension, profit sharing, life insurance or salary continuation plan.

Section 16

Plan Amendment, Modification and Termination

The Board may at any time terminate, and from time to time may amend or modify the Plan provided, however, that no amendment or modification may become effective without approval of the amendment or modification by the shareholders if shareholder approval is required to enable the Plan to satisfy any applicable statutory or regulatory requirements, or if the Company, on the advice of counsel, determines that shareholder approval is otherwise necessary or desirable. No amendment, modification or termination of the Plan shall in any manner adversely affect any Options, Restricted Stock Awards or Stock theretofore granted or purchased under the Plan, without the consent of the Participant holding such Options, Restricted Stock Awards or Stock.

Section 17

Withholding

17.1 Withholding Requirement. The Company's obligations to deliver shares of Stock upon the exercise of any Option, the vesting of any Restricted Stock Award, or the grant or purchase of Stock shall be subject to the Participant's satisfaction of all applicable federal, state and local income and other tax withholding requirements. 17.2 Withholding With Stock. The withholding obligation with respect to the grant of Restricted Stock shall be satisfied by the Company's withholding from the shares otherwise issuable to the Participant shares of Stock having a value equal to the amount required to be withheld. The value of shares of Stock to be withheld shall be based on the Fair Market Value of the Stock on the date that the amount of tax to be withheld is to be determined.

Section 18

Requirements of Law

18.1 Requirements of Law. The issuance of Stock and the payment of cash pursuant to the Plan shall be subject to all applicable laws, rules and regulations. 18.2 Federal Securities Law Requirements. If a Participant is an officer or director of the Company within the meaning of Section 16, Awards granted hereunder shall be subject to all conditions required under Rule 16b-3, or any successor rule promulgated under the 1934 Act, to qualify the Award for any exception from the provisions of Section 16(b) of the 1934 Act available under that Rule. Such conditions shall be set forth in the agreement with the Participant which describes the Award. 18.3 Governing Law. The Plan and all agreements hereunder shall be construed in accordance with and governed by the laws of the State of Colorado.

Section 19

Duration of the Plan

The Plan shall terminate at such time as may be determined by the Board of Directors, and no Option or Restricted Stock Award, or Stock shall be granted or purchased after such termination. Options and Restricted Stock Awards outstanding at the time of the Plan termination may continue to be exercised, or become free of restrictions, or paid, in accordance with their terms.

Dated: ___________________________

ADOLPH COORS COMPANY

ATTEST:

By:________________________________________

ADOLPH COORS COMPANY EQUITY COMPENSATION PLAN

FOR NON-EMPLOYEE DIRECTORS

Amended and Restated, Effective August 14, 1997

SECTION 1 INTRODUCTION

1.1 Establishment; Amendment and Restatement. Adolph Coors Company, a Colorado corporation (the "Company"), established the Adolph Coors Company Equity Compensation Plan for Non-Employee Directors (the "Plan") effective May 16, 1997, for those directors ("Directors") of the Company who are neither officers nor employees of the Company. The Plan provides for the grant of restricted stock awards to Directors of the Company. The Plan was amended and restated effective November 7, 1996. Section 10 of the Plan provides that the Company, by action of the Board, may amend the Plan from time to time. The Plan is hereby amended and restated, effective August 14, 1997, as set forth herein.

1.2 Purposes. The purposes of the Plan are to encourage the Directors to own shares of the Company's stock and thereby to align their interests more closely with the interests of the other shareholders of the Company, to encourage the highest level of Director performance by providing the Directors with a direct interest in the Company's attainment of its financial goals, and to provide a financial incentive that will help attract and retain the most qualified Directors.

1.3 Effective Date. The effective date of the amended and restated Plan is August 14, 1997. The amended and restated Plan and each award granted under the amended and restated Plan is conditioned on and shall be of no force or effect until (a) approval of the amended and restated Plan by the holders of a majority of the shares of voting stock of the Company and (b) receipt by the Company, in form and substance satisfactory to counsel for the Company, of the concurrence of the staff of the Securities and Exchange Commission with the opinions set forth in a "no-action letter," related to Rule 16b-3 or any successor rule ("Rule 16b-3") promulgated under the Securities Exchange Act of 1934 (the "1934 Act"), unless the Company, on the advice of counsel, determines that shareholder approval, a "no action letter," or both are not necessary.

SECTION 2 DEFINITIONS

2.1 Definitions. The following terms shall have the meanings set forth below:

(a) "Board" means the Board of Directors of the Company. (b) "Committee" means a committee consisting of members of the Board who are empowered hereunder to take actions in the administration of the Plan. The Committee shall be so constituted at all times as to permit the Plan to comply with Rule 16b-3. Members of the Committee shall be appointed from time to time by the Board, shall serve at the pleasure of the Board and may resign at any time upon written notice to the Board. (c) "Director" means a member of the Board who is neither an officer nor an employee of the Company. For purposes of the Plan, an employee is an individual whose wages are subject to the withholding of federal income tax under section 3401 of the Internal Revenue Code, and an officer is an individual elected or appointed by the Board or chosen in such other manner as may be prescribed in the bylaws of the Company to serve as such. (d) "Disability" means a physical or mental condition of a Director that is determined by the Social Security Administration to entitle the Director to a Social Security disability benefit. (e) "Fair Market Value" means the average of the highest and lowest prices of the Stock as reported on the National Association of Securities Dealers Automated Quotation System ("NASDAQ") on a particular date. If there are no Stock transactions on such date, the Fair Market Value shall be determined as of the immediately preceding date on which there were Stock transactions. If the price of the Stock is not reported on NASDAQ, the Fair Market Value of the Stock on the particular date shall be as determined by the Committee using a reference comparable to the NASDAQ system. (f) "Internal Revenue Code" means the Internal Revenue Code of 1986, as it may be amended from time to time. (g) "Restricted Stock Award" means an award of Stock granted to a Director pursuant to Section 6 that is subject to certain restrictions imposed in accordance with the provisions of the Plan. (h) "Stock" means the no par value Class B (non-voting) Common Stock of the Company. (i) "Voting Stock" means the $1.00 par value Class A Common Stock of the Company.

2.2 Gender and Number. Except when otherwise indicated by the context, the masculine gender shall also include the feminine gender, and the definition of any term herein in the singular shall also include the plural.

SECTION 3 PLAN ADMINISTRATION

The Committee shall be responsible for the administration of the Plan. However, the Committee shall have no authority, discretion or power to select the Directors who will receive Restricted Stock Awards, determine the Restricted Stock Awards to be granted pursuant to the Plan, the

number of shares of Stock to be issued thereunder or the time at which such Restricted Stock Awards are to be granted, establish the duration and nature of Restricted Stock Awards or alter any other terms or conditions specified in the Plan, except in the sense of administering the Plan subject to the provisions of the Plan. Subject to the foregoing limitations, the Committee, by majority action thereof, is authorized to interpret the Plan, prescribe, amend and rescind rules and regulations relating to the Plan, provide for conditions and assurances deemed necessary or advisable to protect the interests of the Company and make all other determinations necessary or advisable for the administration of the Plan, but only to the extent not contrary to the express provisions of the Plan. No member of the Committee shall be liable for any action or determination made in good faith. The determinations, interpretations and other actions of the Committee pursuant to the provisions of the Plan shall be binding and conclusive for all purposes and on all persons.

SECTION 4 STOCK SUBJECT TO THE PLAN

4.1 Number of Shares. Fifty thousand (50,000) shares of Stock are authorized for issuance under the Plan in accordance with the provisions of the Plan and subject to such restrictions or other provisions as the Committee may from time to time deem necessary. This authorization may be increased from time to time by approval of the Board and by the shareholders of the Company if, in the opinion of counsel for the Company, such shareholder approval is required. Shares of Stock which are issued as Restricted Stock Awards shall be applied to reduce the maximum number of shares of Stock remaining available for use under the Plan. The Company shall at all times during the term of the Plan retain as authorized and unissued Stock at least the number of shares from time to time required under the provisions of the Plan, or otherwise assure itself of its ability to perform its obligations hereunder.

4.2 Other Shares of Stock. Any shares of Stock that are subject to a Restricted Stock Award and which are forfeited, and any shares of Stock that for any other reason are not issued to a Director, shall automatically become available for use under the Plan.

4.3 Adjustments for Stock Split, Stock Dividend, Etc. If the Company shall at any time increase or decrease the number of its outstanding shares of Stock or change in any way the rights and privileges of such shares by means of the payment of a stock dividend or any other distribution upon such shares payable in Stock, or through a stock split, subdivision, consolidation, combination, reclassification or recapitalization involving the Stock, then in relation to the Stock that is affected by one or more of the above events, the numbers, rights and privileges of the following shall be increased, decreased or changed in like manner as if they had been issued and outstanding, fully paid and nonassessable at the time of such occurrence: (i) the shares of Stock as to which Restricted Stock Awards may be granted under the Plan; and (ii) the shares of the Stock then included in each outstanding Restricted Stock Award granted hereunder.

4.4 Dividend Payable in Stock of Another Corporation, Etc. If the Company shall at any time pay or make any dividend or other distribution upon the Stock payable in securities or other property (except money or Stock), a proportionate part of such securities or other property shall be set aside and delivered to any Director then holding a Restricted Stock Award upon lapse of all restrictions applicable to such Restricted Stock Award. Prior to the time that any such securities or other property are delivered to a Director in accordance with the foregoing, the Company shall be the owner of such securities or other property and shall have the right to vote the securities, receive any dividends payable on such securities and in all other respects shall be treated as the owner. If securities or other property which have been set aside by the Company in accordance with this Section are not delivered to a Director because restrictions applicable to such Restricted Stock Award do not lapse, then such securities or other property shall remain the property of the Company and shall be dealt with by the Company as it shall determine in its sole discretion.

4.5 Other Changes in Stock. In the event there shall be any change, other than as specified in Sections 4.3 and 4.4, in the number or kind of outstanding shares of Stock or of any stock or other securities into which the Stock shall be changed or for which it shall have been exchanged, and if the Committee shall in its discretion determine that such change equitably requires an adjustment in the number or kind of shares subject to outstanding Restricted Stock Awards or which have been reserved for issuance pursuant to the Plan but are not then subject to a Restricted Stock Award, then such adjustments shall be made by the Committee and shall be effective for all purposes of the Plan and on each outstanding Restricted Stock Award that involves the particular type of stock for which a change was effected.

4.6 Rights to Subscribe. If the Company shall at any time grant to the holders of its Stock rights to subscribe pro rata for additional shares thereof or for any other securities of the Company or of any other corporation, there shall be reserved with respect to the shares then outstanding pursuant to any Restricted Stock Award the Stock or other securities which the Director would have been entitled to subscribe for if immediately prior to such grant the restrictions applicable to such Restricted Stock Award had lapsed. Upon the lapse of all restrictions applicable to Stock held pursuant to a Restricted Stock Award the Director shall be provided the opportunity to subscribe for the additional shares or other securities issuable with respect to such shares of Stock.

4.7 General Adjustment Rules. No adjustment or substitution provided for in this Section 4 shall require the Company to issue a fractional share of Stock, and the total substitution or adjustment with respect to each Restricted Stock Award shall be limited by deleting any fractional share. In the case of any such substitution or adjustment appropriate adjustments shall be made to Restricted Stock Awards to reflect any such substitution or adjustment.

4.8 Determination by the Committee, Etc. Adjustments under this Section 4 shall be made by the Committee, whose determinations with regard thereto shall be final and binding upon all parties thereto.

SECTION 5 PARTICIPATION

5.1 In General. Each Director shall receive Restricted Stock Awards on the terms and conditions set forth under the Plan. Each Director shall, if required by the Committee, enter into an agreement with the Company, in such form as the Committee shall determine and which is consistent with the provisions of the Plan. In the event of any inconsistency between the provisions of the Plan and any such agreement entered into hereunder, the provisions of the Plan shall govern.

5.2 Restriction on Award Grants to Certain Individuals. Notwithstanding the foregoing provisions of Section 5.1, no Restricted Stock Awards shall be granted to any lineal descendant of Adolph Coors, Jr. without the prior written approval of counsel to the Company as to the effect of any such grant on the possible status of the Company as a "personal holding company" within the meaning of Section 542 of the Internal Revenue Code.

SECTION 6 RESTRICTED STOCK AWARDS

6.1 Minimum Grant of Restricted Stock. Each Director shall receive twenty percent of the value of his annual retainer as a Director in the form of a Restricted Stock Award (the "Minimum Grant"). If a Director is elected as a Director after the beginning of the annual term for Directors, which begins at the May annual shareholders meeting, the Director shall receive a Minimum Grant in the form of a Restricted Stock Award based upon twenty percent of the value of the retainer to be received by the Director for the partial term.

6.2 Elective Grant of Restricted Stock. Each Director may make an annual election (the "Election") to receive any or all of the remaining cash balance of his annual retainer as a Director in the form of a Restricted Stock Award (the "Elective Grant"). The Minimum Grant and the Elective Grant are hereafter referred to as the "Grants". The Election must be in writing and must be delivered to the Secretary of the Company no later than the last business day of the month during which the annual meeting of shareholders of the Company is held, provided, however, that a Director who is elected as a Director after the beginning of the annual term may make an Election to receive an Elective Grant no later than the last business day of the month during which the Director is elected as a Director of the Company. Any Election made by a Director pursuant to this Section 6.2 shall be irrevocable.

6.3 Date of Grant, Number of Shares. The Minimum Grant and Elective Grant, if any, to Directors who are elected at the annual meeting of shareholders shall be made on the last business day of the month during which the annual meeting of shareholders of the Company is held. The Minimum Grant and Elective Grant, if any, to Directors who are elected subsequent to the annual meeting of shareholders shall be made on the last business day of the month during which the Director is elected as a Director of the Company. The total number of shares of stock included in each Restricted Stock Award shall be determined by dividing the amount of the Director's retainer for such annual term that is to be paid in restricted Stock by the Fair Market Value of a share of Stock on the day the Restricted Stock is granted. In no event shall the Company be required to issue fractional shares. Whenever under the terms of this Section 6 a fractional share of Stock would otherwise be required to be issued, an amount in lieu thereof shall be paid in cash based upon the Fair Market Value of such fractional share.

6.4 Retention of Award, Termination. If a Director's services as a Board member terminate for any reason at any time before the completion of the Director's annual term of service, the Director shall be vested in a portion of the shares of Stock granted pursuant to the Grants. The number of vested shares of Stock shall be determined by multiplying the number of shares of Stock included in the Grants by a fraction, the denominator of which is the number of scheduled quarterly Directors' meetings for the annual Director's term in question, or in the case of a Director who is elected subsequent to the annual shareholders meeting, the number of scheduled quarterly Directors' meetings remaining in the annual term on and after the date of such election, and the numerator of which is the number of scheduled quarterly Directors' meetings attended by the Director in such term or a portion of such term, as applicable. Any fractional share shall be rounded down to the next whole share. The remaining number of shares shall be nonvested and shall be forfeited.

6.5 Restrictions. Except as otherwise provided in the Plan, shares of Stock received pursuant to a Restricted Stock Award may not be sold, assigned, pledged, hypothecated, transferred or otherwise disposed of until the restrictions applicable to such Stock have lapsed pursuant to Section 6.6.

6.6 Lapse of Restrictions. Except as provided in Section 9, all restrictions on Stock covered by a Restricted Stock Award pursuant to this Section 6 shall lapse upon completion of the Director's annual term of service during which the Restricted Stock Award was granted.

6.7 Privileges of a Stockholder, Transferability. A Director shall have all voting, dividend, liquidation and other rights with respect to Stock in accordance with its terms received by him as a Restricted Stock Award under this Section 6. A Director's right to sell, encumber or otherwise transfer Stock after restrictions applicable to such Stock pursuant to this Section 6 have lapsed shall be subject to the limitations of Section 9.

6.8 Enforcement of Restrictions. The Committee shall cause a legend to be placed on the Stock certificates issued pursuant to each Restricted Stock Award referring to the restrictions imposed in the Plan and, in addition, may in its sole discretion require one or more of the following methods of enforcing such restrictions:

(a) Requiring the Director to keep the Stock certificates, duly endorsed, in the custody of the Company while the restrictions remain in effect; or (b) Requiring that the Stock certificates, duly endorsed, be held in the custody of a third party while the restrictions remain in effect.

SECTION 7 REORGANIZATION OR CHANGE OF CONTROL

7.1 Reorganization. In the event that the Company is merged or consolidated with another corporation (other than a merger or consolidation in which the Company is the continuing corporation and which does not result in any reclassification or change of outstanding stock), or if all or substantially all of the assets or more than 50% of the outstanding voting stock of the Company is acquired by any other corporation, business entity or person (other than a sale or conveyance in which the Company continues as a holding company of an entity or entities that conduct the business or businesses formerly conducted by the Company), or in case of a reorganization (other than a reorganization under the United States Bankruptcy Code) or liquidation of the Company, the Committee, or the board of directors of any corporation assuming the obligations of the Company, shall, as to the Plan and outstanding Restricted Stock Awards, either (i) make appropriate provision for the adoption and continuation of the Plan by the acquiring or successor corporation and for the protection of any such outstanding Restricted Stock Awards by the substitution on an equitable basis of appropriate stock of the Company or of the merged, consolidated or otherwise reorganized corporation which will be issuable with respect to the Stock, provided that no additional benefits shall be conferred upon the Directors holding such Restricted Stock Awards as a result of such substitution, or (ii) accelerate the restriction period for any outstanding Restricted Stock Awards so that all restrictions applicable to Restricted Stock Awards shall lapse prior to any such event.

7.2 Change of Control. In the event of a change of control of the Company, as defined below, then all restrictions with respect to outstanding Restricted Stock Awards shall immediately lapse. For purposes of the Plan, a "change of control" shall be deemed to have occurred if during any period of two consecutive years (not including any period prior to the Effective Date), individuals who at the beginning of such period constitute the Board (and any new director whose election by the Board or whose nomination for election by the Company's shareholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority thereof.

SECTION 8 RIGHTS OF DIRECTORS

8.1 Retention as Director. Nothing contained in the Plan or in any Restricted Stock Award granted under the Plan shall interfere with or limit in any way the right of the shareholders of the Company to remove any Director from the Board pursuant to the bylaws of the Company, nor confer upon any Director any right to continue in the service of the Company.

8.2 Nontransferability. No right or interest of any Director in a Restricted Stock Award (prior to the completion of the restriction period applicable thereto), granted pursuant to the Plan, shall be assignable or transferable during the lifetime of the Director, either voluntarily or involuntarily, or subjected to any lien, directly or indirectly, by operation of law, or otherwise, including execution, levy, garnishment, attachment, pledge or bankruptcy. In the event of a Director's death, a Director's rights and interests in Restricted Stock Awards shall, to the extent vested as provided in Section 6, be transferable by testamentary will or the laws of descent and distribution. If in the opinion of the Committee a person entitled to payments or to exercise rights with respect to the Plan is disabled from caring for his affairs because of mental condition, physical condition or age, payment due such person may be made to, and such rights shall be exercised by, such person's guardian, conservator or other legal personal representative upon furnishing the Committee with evidence satisfactory to the Committee of such status.

SECTION 9 COMPANY RIGHT TO PURCHASE STOCK

9.1 Right of First Refusal. (a) In the event of the death of a Director, or if a Director at any time proposes to transfer to a third party any of the Stock acquired pursuant to the Plan on or after the effective date of this amended and restated Plan, the Director (or his personal representative or estate, as the case may be) shall make a written offer (the "Offer") to sell all of the Stock acquired pursuant to the Plan then owned by the Director (or thereafter acquired by the Director's estate or personal representative pursuant to any Restricted Stock Award hereunder) to the Company at the "purchase price" as hereinafter defined. In the case of a proposed sale of any of the Stock to a third party, the Offer shall state the name of the proposed transferee and the terms and conditions of the proposed transfer. In a case of a proposed sale through or to a registered broker/dealer, the Offer shall state the name and address of the broker. The Company shall have the right to elect to purchase all (but not less than all) of the shares of Stock. The Company shall have the right to elect to purchase the shares of Stock for a period of ten (10) days after the receipt by the Company of the Offer. The provisions of this Section 9 shall apply to proposed sales through or to a registered broker/dealer at the prevailing market price, even if the prevailing market price should fluctuate between the date the Company receives the Offer and the date the Company elects to purchase the shares of Stock. In all cases, the purchase price for the Stock shall be determined pursuant to subsection 9.1(d). (b) The Company shall exercise its right to purchase the Stock by given written notice of its exercise to the Director (or his personal representative or estate, as the case may be). If the Company elects to purchase the Stock, payment for the shares of Stock shall be made in full by Company check. Any such payments shall be made within ten (10) days after the election to purchase has been exercised. (c) If the Stock is not purchased pursuant to the foregoing provisions, the shares of Stock may be transferred by the Director the proposed transferee named in the Offer to the Company, in the case of a proposed sale to a third party. However, if such transfer is not made within 120 days following the termination of the Company's right to purchase, a new offer must be made to the Company before the Director can transfer any portion of his shares and the provisions of this Section 9 shall again apply to such transfer. If the Company's right of first refusal under this Section 9 is created by an event other than a proposed transfer to a third party, the shares of Stock shall remain subject to the provisions of this Section 9 in the hands of the registered owner of the Stock. (d) The purchase price for each share of Stock purchased by the Company pursuant to this Section 9 shall be equal to the Fair Market Value of the Stock on the date the Company receives the Offer under subsection 9.1(a).

9.2 Marking of Certificates. Each certificate representing shares of Stock acquired pursuant to this Plan shall bear the following legend:

The shares of stock represented by this Certificate are subject to all the terms of the Adolph Coors Company Equity Compensation Plan for Non-Employee Directors, as the Plan may be amended from time to time (the "Plan"). Copies of the Plan are on file at the office of the Company. The Plan, among other things, limits the right of the Owner to transfer the shares represented hereby and provides that in certain circumstances the shares may be purchased by the Company.

SECTION 10 GENERAL RESTRICTIONS

10.1 Investment Representations. The Company may require any Director to whom a Restricted Stock Award is granted, as a condition of receiving such Restricted Stock Award, to give written assurances in substance and form satisfactory to the Company and its counsel to the effect that such person is acquiring the Stock subject to the Restricted Stock Award for his own account for investment and not with any present intention of selling or otherwise distributing the same, and to such other effects as the Company deems necessary or appropriate in order to comply with Federal and applicable state securities laws.

10.2 Compliance with Securities Laws. Each Restricted Stock Award shall be subject to the requirement that, if at any time counsel to the Company shall determine that the listing, registration or qualification of the shares subject to such Restricted Stock Award upon any securities exchange or under any state or federal law, or the consent or approval of any governmental or regulatory body, is necessary as a condition of, or in connection with, the issuance of shares thereunder, such Restricted Stock Award may not be accepted or exercised in whole or in part unless such listing, registration, qualification, consent or approval shall have been effected or obtained on conditions acceptable to the Committee. Nothing herein shall be deemed to require the Company to apply for or to obtain such listing, registration or qualification.

10.3 Changes in Accounting Rules. Notwithstanding any other provision of the Plan to the contrary, if, during the term of the Plan, any changes in the financial or tax accounting rules applicable to Restricted Stock Awards shall occur which, in the sole judgment of the Committee, may have a material adverse effect on the reported earnings, assets or liabilities of the Company, the Committee shall have the right and power to modify as necessary any then outstanding Restricted Stock Awards as to which the applicable restrictions have not been satisfied.

10.4 Withholding of Tax. To the extent required by applicable law and regulation, each Director must arrange with the Company for the payment of any federal, state or local income or other tax applicable to the Restricted Stock Award granted hereunder before the Company shall be required to deliver to the Director a certificate for such Stock free and clear of all restrictions under Section 6 of this Plan.

SECTION 11 PLAN AMENDMENT, MODIFICATION AND TERMINATION

The Board may at any time terminate, and from time to time may amend or modify the Plan provided, however, that no amendment or modification may become effective without approval of the amendment or modification by the shareholders if shareholder approval is required to enable the Plan to satisfy any applicable statutory or regulatory requirements, or if the Company, on the advice of counsel, determines that shareholder approval is otherwise necessary or desirable.

No amendment, modification or termination of the Plan shall in any manner adversely affect any Restricted Stock Awards theretofore granted under the Plan without the consent of the Director holding such Restricted Stock Awards.

SECTION 12 REQUIREMENTS OF LAW

12.1 Requirements of Law. The issuance of stock and the payment of cash pursuant to the Plan shall be subject to all applicable laws, rules and regulations.

12.2 Federal Securities Law Requirements. Awards granted hereunder shall be subject to all conditions required under Rule 16b-3 to qualify the Restricted Stock Award for any exception from the provisions of Section 16(b) of the 1934 Act available under that Rule. Such conditions shall be set forth in the agreement with the Director which describes the Restricted Stock Award.

12.3 Governing Law. The Plan and all agreements hereunder shall be construed in accordance with and governed by the laws of the State of Colorado.

SECTION 13 DURATION OF THE PLAN

The Plan shall terminate at such time as may be determined by the Board of Directors, and no Restricted Stock Award shall be granted after such termination. Restricted Stock Awards outstanding at the time of the Plan termination shall become free of restrictions in accordance with their terms.

Dated: ______________________

ATTEST: ADOLPH COORS COMPANY

_____________________________ By:

TABLE OF CONTENTS

Page SECTION 1- INTRODUCTION 1 1.1 Establishment; Amendment and Restatement 1 1.2 Purposes 1 1.3 Effective Date 1 SECTION 2 - DEFINITIONS 1 2.1 Definitions 1 2.2 Gender and Number 2 SECTION 3 - PLAN ADMINISTRATION 2 SECTION 4 - STOCK SUBJECT TO THE PLAN 3 4.1 Number of Shares 3 4.2 Other Shares of Stock 3 4.3 Adjustments for Stock Split, Stock Divide nd, Etc 3 4.4 Dividend Payable in Stock of Another Corp oration, Etc 3 4.5 Other Changes in Stock 4 4.6 Rights to Subscribe 4 4.7 General Adjustment Rules 4 4.8 Determination by the Committee, Etc 4 SECTION 5 - PARTICIPATION 4 5.1 In General 4 5.2 Restriction on Award Grants to Certain In dividuals 4 SECTION 6 - RESTRICTED STOCK AWARDS 5 6.1 Minimum Grant of Restricted Stock 5 6.2 Elective Grant of Restricted Stock 5 6.3 Date of Grant, Number of Shares 5 6.4 Retention of Award, Termination. 5 6.5 Restrictions 6 6.6 Lapse of Restrictions 6 6.7 Privileges of a Stockholder, Transferabil ity 6 6.8 Enforcement of Restrictions 6 SECTION 7 - REORGANIZATION OR CHANGE OF CONTROL 6 7.1 Reorganization 6 7.2 Change of Control 7 SECTION 8 - RIGHTS OF DIRECTORS 7 8.1 Retention as Director 7 8.2 Nontransferability 7 SECTION 9 - COMPANY RIGHT TO PURCHASE STOCK 7 9.1 Right of First Refusal 7 9.2 Marking of Certificates 8 SECTION 10 - GENERAL RESTRICTIONS 8 10.1 Investment Representations 8 10.2 Compliance with Securities Laws 9 10.3 Changes in Accounting Rules 9 10.4 Withholding of Tax 9 SECTION 11 - PLAN AMENDMENT, MODIFICATION AND TERMI NATION 9 SECTION 12 - REQUIREMENTS OF LAW 9 12.1 Requirements of Law 9 12.2 Federal Securities Law Requirements 9 12.3 Governing Law 10 SECTION 13 - DURATION OF THE PLAN 10

ADOLPH COORS COMPANY COORS STOCK UNIT PLAN

Amended and Restated Effective August 14, 1997

Section 1 Introduction

1.1 Establishment. Adolph Coors Company, a Colorado corporation (as defined in subsection 2.1(e), the "Company"), established the Adolph Coors Company Coors Stock Unit Plan (the "Plan") effective March 28, 1995, for certain employees of the Company and its Affiliated Corporations (as defined in subsection 2.1(a)). The Plan permits the grant of Coors Stock Units (as defined in subsection 2.1(f)) to certain employees of the Company and its Affiliated Corporations. Section 12 of the Plan provides that the Company, by action of the Board, may amend the Plan from time to time. The Plan is hereby amended and restated, effective August 14, 1997, as set forth herein. The provisions of the Plan, as so amended and restated, shall be effective with respect to Coors Stock Units granted on and after August 14, 1997. Coors Stock Units granted prior to August 14, 1997 shall remain subject to the provisions of the Plan prior to its amendment and restatement herein.

1.2 Purposes. The purposes of the Plan are to reward the employees selected for participation in the Plan for exemplary performance and to create in such employees a more direct interest in the future success of the operations of the Company.

Section 2 Definitions

2.1 Definitions. The following terms shall have the meanings set forth below:

(a) "Affiliated Corporation" means any corporation which is affiliated with Adolph Coors Company through stock ownership or otherwise and is treated as a common employer under the provisions of Sections 414(b) and (c) of the Internal Revenue Code. (b) "Award" means certain bonus compensation amounts granted to eligible employees under compensation award programs of the Company, including, but not limited to, the Company's Spot Award Program and Productivity Award Program. (c) "Board" means the Board of Directors of the Company. (d) "Committee" means a committee consisting of members who are empowered hereunder to take actions in the administration of the Plan. Members of the Committee shall be appointed from time to time by the Board, shall serve at the pleasure of the Board and may resign at any time upon written notice to the Board. (e) "Company" means Adolph Coors Company, a Colorado corporation, or any company which is a successor thereto as a result of merger, consolidation, liquidation or other reorganization. (f) "Coors Stock Unit" means a measurement component equal to the "Fair Market Value" of a share of the Company's Class B common stock (non-voting), no par ("Class B Common Stock"). For this purpose, "Fair Market Value" shall be based upon the average of the highest and lowest prices of the Class B Common Stock as reported on the National Association of Securities Dealers Automated Quotation system ("NASDAQ") on a particular date. If there are no transactions in Class B Common Stock on such date, the "fair market value" shall be determined as of the immediately preceding day on which there were stock transactions. If the price of the Class B Common Stock is not reported on NASDAQ, the fair market value of the Class B Common Stock on the particular date shall be determined by the Committee using a reference comparable to the NASDAQ system. (g) "Effective Date" means the original effective date of the Plan, March 28, 1995. (h) "Eligible Employees" means those employees of the Company and its Affiliated Corporations who are eligible to receive Awards and who are designated by the Committee as Eligible Employees under this Plan. (i) "Internal Revenue Code" means the Internal Revenue Code of 1986, as it may be amended from time to time. (j) "Participant" means an Eligible Employee who has elected, pursuant to Section 5, to defer receipt of his or her Award and to have the amount so deferred converted into Coors Stock Units. (k) "Termination Date" means the date of a Participant's severance from employment with the Company and all Affiliated Corporations for any reason, including but not limited to, death, "Disability," "Retirement," resignation, voluntary or involuntarily termination or otherwise. For purposes of this Plan, "Retirement" shall mean termination of employment in accordance with the Company's retirement policy, and "Disability" shall mean termination of employment as a result of disability as defined in the Company's Long Term Disability Plan.

2.2 Gender and Number. Except when otherwise indicated by the context, the masculine gender shall also include the feminine gender, and the definition of any term herein in the singular shall also include the plural.

Section 3 Plan Administration

3.1 Committee. The Plan shall be administered by the Committee. No member of the Committee while serving as such shall be eligible for participation in the Plan, and no person who is at the time a Participant in the Plan shall be eligible to serve on the Committee.

3.2 Powers. The Committee shall have exclusive and final authority to interpret the Plan consistent with the intent of the Plan, to prescribe, amend, and rescind rules and regulations relating to the Plan, to delegate such responsibilities or duties as are allowable under the Plan or by law and as it deems desirable, and to make all other determinations necessary or advisable for the administration of the Plan. A majority of the

members of the Committee shall constitute a quorum and all determinations of the Committee will be made by a majority of a quorum. Any determination by the Committee under the Plan may be without notice of and without convening a meeting if evidenced by one or more writings signed by a majority of all of the Committee members. The Committee may act by telephonic meetings in which all of its members participate with or without prior notice, or in which a quorum participates after not less than twenty-four (24) hours' notice in person, by telephonic, electronic or written means. The Committee may from time to time adopt such rules and regulations for carrying out the purposes of the Plan as it may deem proper and in the best interests of the Company. The Committee may correct any defect, supply any omission or reconcile any inconsistency in the Plan or in any agreement entered into hereunder in the manner and to the extent it shall deem expedient and it shall be the sole and final judge of such expediency. No member of the Committee shall be liable for any action or determination made in good faith. The determinations, interpretations and other actions of the Committee pursuant to the provisions of the Plan shall be binding and conclusive for all purposes and on all persons.

Section 4 Participation in the Plan

The Committee shall establish the criteria for participation of Eligible Employees in the Plan. An Eligible Employee shall become a Participant in the Plan upon designation as an Eligible Employee and upon an election, by the Eligible Employee pursuant to Section 5, to acquire Coors Stock Units in accordance with Section 5.

Section 5 Acquisition of Coors Stock Units

5.1 Election to Acquire Coors Stock Units. Each Eligible Employee may make an election, pursuant to such procedures and at such times as may be prescribed by the Committee, to receive Coors Stock Units instead of any specified Award otherwise payable to the Eligible Employee. Coors Stock Units acquired pursuant to this Section shall be valued, for purposes of determining the number of Coors Stock Units to be issued with respect to the dollar amount of Award elected to be used for such purpose, based upon the Fair Market Value of the Class B Common Stock as of the date on which the Award would otherwise be payable to such Eligible Employee. Only whole Coors Stock Units shall be granted hereunder and any remaining portion of a designated Award shall be paid to a Participant in cash. The grant of Coors Stock Units and the payment of cash in accordance with this Section 5.1 shall be subject to withholding of applicable federal, state and local income and employment taxes.

5.2 Establishment of Individual Coors Stock Unit Accounts. The Company shall establish, or shall cause to be established, individual accounts ("Coors Stock Unit Accounts") for each Participant who elects to receive Coors Stock Units which will be unsecured and unfunded and will be maintained for each acquisition of Coors Stock Units by a Participant under the Plan. The Account for each Participant shall reflect the number of Coors Stock Units acquired and held by such Participant and the dividends paid by the Company on shares of Class B Common Stock with respect to dividend record dates that occur on and after the date as of which such Coors Stock Units are granted to the Participant. While any Coors Stock Units are outstanding, and at payment, if any, Participants will receive annual and final statements showing the number of Coors Stock Units allocated to their Account in the Plan, the value of dividend equivalents allocated to their Account and the total value of the Account.

Section 6 Payments to Participants

6.1 Participant Election to Receive Payment. At any time following the expiration of one year from the date of the issuance of a Coors Stock Unit, a Participant may elect to receive payment for the value of such Coors Stock Units and the dollar amount of dividend equivalents that have been allocated to the Participant's Coors Stock Unit Account. The Participant shall elect to receive payment by submitting a written election, in a form prescribed by the Committee, to the Committee or to such person as may be specified by the Committee. The payment with respect to a Participant's Coors Stock Units shall be based on the Fair Market Value of the equivalent number of shares of Class B Common Stock on the date that the Participant's election is received by the Committee or its designee. Payments to Participants under this Section should be made by Company check, subject to any applicable withholding of federal, state or local income or other taxes, within twenty (20) business days following the receipt by the Committee of the Participant's election to receive payment with respect to his or her Coors Stock Units.

6.2 Payment Following Termination Date. Except as otherwise provided in this Section, a Participant in the Plan shall receive payment, following the Participant's Termination Date, for all of his or her Coors Stock Units and the dividend equivalents credited to the Participant's Coors Stock Unit Account as of the Participant's Termination Date. The Participant shall be entitled to the payment of an amount equal to the Fair Market Value of the equivalent amount of Class B Common Stock and the value of the accumulated dividend equivalents allocated to the Participant's Coors Stock Unit Account as of the Termination Date. Payment shall be made to the Participant in a cash lump sum, subject to applicable withholding of income tax and other amounts, within twenty (20) business days following the Participant's Termination Date.

6.3 Death of a Participant. If a Participant dies before receiving payment of all amounts payable to the Participant hereunder, any amounts remaining shall be paid to the personal representative of the Participant's estate.

6.4 Issuance of Class B Common Stock in Lieu of Cash Payments. If a Participant has 100 or more Coors Stock Units allocated to his or her Coors Stock Unit Account, the Participant (or his or her estate) may elect to receive payment for the value of such Coors Stock Units through the issuance of an equivalent number of shares of Class B Common Stock. Elections to receive shares of Class B Common Stock in lieu of cash payments shall be made in accordance with such procedures as may be required from time to time by the Committee. Payments to a Participant

(or his or her estate) with respect to dividend equivalents that have been allocated to the Participant's Coors Stock Unit Account shall be made in cash in all cases.

Section 7 Recapitalizations or Other Changes in the Outstanding Stock of the Company

The number of Coors Stock Units authorized, issued and outstanding under the Plan will be adjusted to reflect any stock dividends, stock-splits or other capital restructuring of the Company after the date of grant of a particular Coors Stock Unit in a manner directly corresponding to adjustments in the number and kind of outstanding shares of stock of the Company. The Committee shall make such adjustments to outstanding Coors Stock Units as shall be necessary, in its sole discretion, to equitably reflect the effect of the change in the capital structure of the Company upon the outstanding Coors Stock Units under this Plan. Adjustments under this Section 7 shall be made by the Committee, whose determinations with regard thereto shall be final and binding upon all parties thereto.

Section 8 Adoption of Plan by Affiliated Corporations

8.1 Adoption of Plan. Any corporation, whether or not presently existing, which is or shall become an Affiliated Corporation may become a party to the Plan, with the consent of the Company, by adopting the Plan for its Eligible Employees. Such Affiliated Corporation shall deliver to the Company a certified copy of the resolutions or other documents evidencing its adoption of the Plan.

8.2 Agency of the Company. By becoming a party to the Plan, each Affiliated Corporation constitutes the Company as its agent with authority to act for it in all transactions in which the Company believes such agency will facilitate the administration of the Plan and with authority to amend and terminate the Plan.

8.3 Disaffiliation and Withdrawal from Plan. Any Affiliated Corporation that has adopted the Plan and that thereafter ceases for any reason to be an Affiliated Corporation shall forthwith cease to be a party to the Plan. Any Affiliated Corporation may, by resolution of its board of directors and written notice thereof to the Company provide from and after the end of any Plan Year for the discontinuance of Plan participation by such corporation and its Eligible Employees.

8.4 Effect of Disaffiliation or Withdrawal. If at the time of disaffiliation or withdrawal the disaffiliating or withdrawing corporation shall by resolution of its board of directors determine to adopt a substantially identical Plan, then, as to Employees of such corporation, no Plan termination shall be held to have occurred and the new Plan shall, as to such Employees, be deemed a continuation of this Plan.

8.5 Distribution Upon Disaffiliation or Withdrawal. In the event of disaffiliation or withdrawal, if the provisions of Section 8.4 are not followed, the Plan shall terminate as to such Affiliated Corporation and the provisions of Section 12 shall apply.

Section 9 Rights of Employees

Nothing contained in the Plan or in any Coors Stock Unit granted under the Plan shall confer upon any Participant any right with respect to the continuation of his or her employment by the Company or any Affiliated Corporation, or interfere in any way with the right of the Company or any Affiliated Corporation, subject to the terms of any separate employment agreement to the contrary, at any time to terminate such employment or to increase or decrease the compensation of the Participant. Whether an authorized leave of absence, or absence in military or government service, shall constitute a termination of employment shall be determined by the Committee at the time.

Section 10 General Restrictions

10.1 Investment Representations. The Company may require any person to whom a Coors Stock Unit is granted, as a condition of receiving such Coors Stock Unit, to give written assurances in substance and form satisfactory to the Company and its counsel to the effect that such person is acquiring the Coors Stock Unit for his own account for investment and not with any present intention of selling or otherwise distributing the same, and to such other effects as the Company deems necessary or appropriate in order to comply with Federal and applicable state securities laws.

10.2 Changes in Accounting Rules. Notwithstanding any other provision of the Plan to the contrary, if, during the term of the Plan, any changes in the financial or tax accounting rules applicable to Coors Stock Units shall occur which, in the sole judgment of the Committee, may have a material adverse effect on the reported earnings, assets or liabilities of the Company, the Committee shall have the right and power to modify, as necessary, any then outstanding Coors Stock Units.

Section 11 Other Employee Benefits

The amount of any compensation deemed to be received by a Participant as a result of the receipt of a Coors Stock Unit or cash payments for

such Coors Stock Units shall not constitute "earnings" with respect to which any other employee benefits of such employee are determined, including without limitation benefits under any pension, profit sharing, life insurance or salary continuation plan.

Section 12 Plan Amendment, Modification and Termination

The Board may at any time terminate, and from time to time may amend or modify the Plan. Upon termination of the Plan, no further Coors Stock Units shall be issued, but the provisions of the Plan shall remain applicable to all Coors Stock Units then outstanding at the time of Plan termination. No amendment, modification or termination of the Plan shall in any manner adversely affect any Coors Stock Units theretofore granted under the Plan, without the consent of the Participant holding such Coors Stock Units.

Section 13 Setoff

All or part of any amount otherwise due and payable to a Participant under the Plan may be setoff or applied by the Company against any liability or reimbursement then due and payable by the Participant to the Company or any Affiliated Corporation.

Section 14 Plan Funding

Obligations to Participants under the Plan will not be funded, trusteed, insured or secured in any manner. The Participants under the Plan shall have no security interest in any assets of the Company or any Affiliated Corporation, shall have no interest or right as a shareholder in the Company or any Affiliated Corporation and shall be only general creditors of the Company.

Section 15 Non-Assignability of Rights

Except as provided in the Plan, no grant, right, benefit or account of a Participant under this Plan shall be subject to anticipation, alienation, sale, assignment, pledge, encumbrance, or charge, and any attempt to anticipate, alienate, sell, assign, pledge, encumber, or charge the same shall be void. No right or benefit under the Plan shall in any manner be liable for or subject to the debts, contracts, liabilities, or torts of the person entitled to such benefits except as expressly provided herein. If any Participant should become bankrupt or attempt to anticipate, alienate, sell, assign, pledge, encumber, or charge any right or benefit hereunder, then such right or benefit shall, in the discretion of the Committee, cease, and in such event, the Company may hold or apply the same or any part thereof for the benefit of the Participant or the Participant's spouse, children, or other dependents, or any of them in such manner and in such proportions as the Committee shall deem proper. The Company, the Affiliated Corporations and the Committee shall have no liability or obligation to any Participant or Participant's representative on account of any variation in the Fair Market Value of the Class B Common Stock or the value of a Participant's Coors Stock Unit Account.

Section 16 Withholding Taxes

The Company shall have the right to deduct from all amounts payable to a Participant, including the issuance of shares of Class B Common Stock in accordance with the provisions of Section 6.4, any taxes or other impositions required by law to be withheld upon such payment.

Section 17 Requirements of Law

17.1 Requirements of Law. The issuance of Coors Stock Units and the payment of cash pursuant to the Plan shall be subject to all applicable laws, rules and regulations.

17.2 Governing Law. The Plan and all agreements hereunder shall be construed in accordance with and governed by the laws of the State of Colorado.

Section 18 Duration of the Plan

The Plan shall terminate at such time as may be determined by the Board of Directors, and no Coors Stock Units shall be granted after such termination. Coors Stock Units outstanding at the time of the Plan termination shall continue to be paid in accordance with their terms.

Dated: __________________

ADOLPH COORS COMPANY

ATTEST:

By:_________________________________

6.4 Issuance of Class B Common Stock in Lieu of Cash Payments 5 Section 7 - Recapitalizations or Other Changes in the Outstanding

Section 18 - Duration of the Plan 9

TABLE OF CONTENTS Page Section 1 - Introduction 1 1.1 Establishment 1 1.2 Purposes 1 Section 2 - Definitions 1 2.1 Definitions 1 2.2 Gender and Number 2 Section 3 - Plan Administration 3 3.1 Committee 3 3.2 Powers 3 Section 4 - Participation in the Plan 3 Section 5 - Acquisition of Coors Stock Units 3 5.1 Election to Acquire Coors Stock Units 3 5.2 Establishment of Individual Coors Stock Un it Accounts 4 Section 6 - Payments to Participants 4 6.1 Participant Election to Receive Payment 4 6.2 Payment Following Termination Date 4 6.3 Death of a Participant 5

Stock of the Company 5 Section 8 - Adoption of Plan by Affiliated Corporat ions 5 8.1 Adoption of Plan 5 8.2 Agency of the Company 5 8.3 Disaffiliation and Withdrawal from Plan 6 8.4 Effect of Disaffiliation or Withdrawal 6 8.5 Distribution Upon Disaffiliation or Withdr awal 6 Section 9 - Rights of Employees 6 Section 10 - General Restrictions 6 10.1 Investment Representations 6 10.2 Changes in Accounting Rules 6 Section 11 - Other Employee Benefits 7 Section 12 - Plan Amendment, Modification and Termi nation 7 Section 13 - Setoff 7 Section 14 - Plan Funding 7 Section 15 - Non-Assignability of Rights 8 Section 16 - Withholding Taxes 8 Section 17 - Requirements of Law 8 17.1 Requirements of Law 8 17.2 Governing Law 8

Page 1 of 3 COORS BREWING COMPANY

1998 ANNUAL MANAGEMENT INCENTIVE COMPENSATION PLAN

(MIC)

PARTICIPANTS:

All Department Directors and above in salary grades E08 and E09 will participate in an annual incentive program known as the Management Incentive Compensation Plan (MIC).

Participants who are newly hired or promoted into an eligible position during the Plan year will be eligible to receive a pro- rata share of the incentive payment based on the number of calendar days spent in an eligible position divided by the actual number of days during the year of the Plan.

ANNUAL INCENTIVE PROGRAM TARGET LEVELS AS A PERCENT OF BASE SALARY AS OF 1-1-98 OR PLAN ENTRY DATE IF LATER:

Total On Target

BONUS PAYOUT PARAMETERS:

The Chief Executive Officer (CEO) and Chief Operating Officer (COO) will be measured on Company financial performance only. All other participants will be evaluated based on two components, the achievement of Company financial performance goals and individual performance goals. The percentages of the total potential bonus are:

If the Company financial goals are achieved, each participant will receive the portion of the bonus based on the Company component. None of the Company portion will be paid if pre-tax income falls below a minimum of 75% of the target financial goal. The amount of the Company component will be reduced 2% from target for each 1% that actual results fall below the target pretax income goal. For each 1% the Company pretax income exceeds the target goal, the target Company component will increase 2%.

COMPANY FINANCIAL TARGETS:

Annual Company financial goals will be measured based on pre-tax income before special charges or credits for 1998 after incentive plan payouts (in millions).

Minimum Target Maximum 95.25 127 190.5

Definitions:

Pretax Income - Income before income taxes for external reporting as shown on the Annual Report. Income is defined as Revenues (amounts received from the sales of beer) less Costs (manufacturing costs including brewing, packaging, raw materials, and freight, and all other costs required to run the business including marketing, selling, support costs, interest expense/(income), etc...). This includes both Domestic and International and would also include the revenue and expenses associated with entering an international market.

Bonus Position Potential CEO/COO 50% Executive Staff 40% VP GBBU 35% Vice President 30% Other Participants 25%

Company In dividual Position Component C omponent CEO/COO 100% 0% Executive Staff 75% 25% Vice President 40% 60% Other Participants 40% 60%

Special Charges (Credits) - Extraordinary items (one-time unusual events) which are separately identified in the Company's internal and external financial statements and other special items as defined by management.

INDIVIDUAL PERFORMANCE GOALS:

The other portion of the bonus is based on achievement of individual performance goals. The individual portion of the bonus is not dependent on fulfillment of Company financial goals. Individual performance payouts will be based on an individual incentive multiplier of between 0 and 150%, multiplied by the amount equal to the dollar amount of the individual performance component at target:

Individual performance goals will be documented and agreed upon by February 1 of the Plan year or 30 days after the start date in the Plan. Each participant will meet with his or her immediate supervisor to develop individual goals in support of the Company strategies. These goals will be written and signed off by the participant and the supervisor before implementation. All individual goals must be reviewed and approved by the COO or the CEO. At the end of the Plan year each supervisor must submit in writing the results of each individual performance goal and the individual performance multiplier.

FORM AND TIMING OF PAYMENTS:

At the end of the plan year final awards will be calculated. Payments will be made as soon as practicable after the end of the plan year.

FEDERAL, STATE AND FICA TAX WITHHOLDING:

The Company will be required to withhold all applicable federal, state and FICA income taxes on the awards.

TAX TREATMENT:

Participants realize taxable income at the date the incentive payout is received.

DISCLAIMER:

Coors Brewing Company reserves the right to change, amend or terminate this Plan at any time, for any reason at its sole discretion. This Plan supersedes all prior documentation relating to the Annual Management Incentive Compensation Plan.

NOT EMPLOYMENT CONTRACT:

At no time is this plan to be considered an employment contract between the participants and the Company. It does not guarantee participants the right to be continued as an employee of the Company. It does not effect a participants right to leave the Company or the Company's right to discharge a participant.

TERMINATION PROVISIONS:

Participants must be on the payroll as of 1-1-1999 to receive payment. Any exceptions must be approved by the CEO.

Above Target 125-150% On Target 100% Below Target 0-70%

$200,000,000 REVOLVING CREDIT AGREEMENT

dated as of October 23, 1997

among

ADOLPH COORS COMPANY as Borrower,

NATIONSBANK OF TEXAS, N.A. as Agent,

WACHOVIA BANK, N.A. as Managing Agent,

THE FIRST NATIONAL BANK OF CHICAGO as Co-Agent,

and

THE BANKS NAMED HEREIN as Banks

TABLE OF CONTENTS Pag e ARTICLE I - DEFINITIONS 1 SECTION 1.01. Definitions 1 SECTION 1.02. Accounting Terms and Determinat ions. 14 ARTICLE II - THE CREDITS 14 SECTION 2.01. Syndicated Borrowings. 14 SECTION 2.02. Notice of Syndicated Borrowings . 16 SECTION 2.03. Money Market Borrowings 17 SECTION 2.04. THIS SECTION IS RESERVED 22 SECTION 2.05. Interest Period for Borrowings. 22 SECTION 2.06. Maturity of Loans and Payment o f Interest. 23 SECTION 2.07. Interest Rate Options 23 SECTION 2.08. Certain Loans or Interest Rates Unavailable. 26 SECTION 2.09. Default Rate 26 SECTION 2.10. Evidence of Loans/Borrowings 27 SECTION 2.11. Failure to Give Notice, Automat ic Conversion 27 SECTION 2.12. Prepayments 27 SECTION 2.13. Funding Losses 28 SECTION 2.14. General Rules as to Payments 28 SECTION 2.15. Funding of Loans. 28 SECTION 2.16. Fees. 29 SECTION 2.17. Optional Reduction of Commitmen ts 29 SECTION 2.18. Extension of Termination Date 30 SECTION 2.19. Letters of Credit 31 ARTICLE III - CONDITIONS 32 SECTION 3.01. Conditions to Effectiveness 32 SECTION 3.02. Conditions to Borrowings 33 ARTICLE IV - REPRESENTATIONS AND WARRANTIES 33 SECTION 4.01. Corporate Existence and Power 33 SECTION 4.02. Corporate and Governmental Authorization; No Contravention 34 SECTION 4.03. Binding Effect 34 SECTION 4.04. Financial Information 34 SECTION 4.05. Litigation 34 SECTION 4.06. Compliance with ERISA 34 SECTION 4.07. Compliance with Laws 34 SECTION 4.08. Taxes 35 SECTION 4.09. Subsidiaries 35 SECTION 4.10. Not an Investment Company 35 SECTION 4.11. No Margin Stock 35 SECTION 4.12. Full Disclosure 35 SECTION 4.13. Excluded Principal Plants 35 ARTICLE V - GENERAL COVENANTS 35

TEXAS, N.A., a national banking association, as agent for itself and the other Banks (in such capacity, together with its successors in such capacity, the "Agent"), WACHOVIA BANK, N.A., a national banking association, as managing agent for itself and the other Banks (in such capacity, together with its successors in such capacity, the "Managing Agent"), THE FIRST NATIONAL BANK OF CHICAGO, a national

SECTION 5.01. Information 36 SECTION 5.02. Payment of Obligations 37 SECTION 5.03. Maintenance of Property 37 SECTION 5.04. Insurance 37 SECTION 5.05. Conduct of Business and Mainten ance of Existence 37 SECTION 5.06. Compliance with Laws 38 SECTION 5.07. Inspection of Property, Books a nd Records 38 SECTION 5.08. Use of Proceeds 38 SECTION 5.09. Environmental Matters 38 SECTION 5.10. Delivery of Additional Guaranti es 38 ARTICLE VI - NEGATIVE COVENANTS 39 SECTION 6.01. Limitations on Liens 39 SECTION 6.02. Limitation on Debt of Restricte d Subsidiaries 41 SECTION 6.03. Consolidations, Mergers and Sal es of Assets 42 SECTION 6.04. Other Loan Agreements 42 ARTICLE VII - FINANCIAL COVENANTS 43 SECTION 7.01. Debt to Capitalization. 43 ARTICLE VIII - DEFAULTS AND EVENTS OF TERMINATION 43 SECTION 8.01. Events of Default 43 SECTION 8.02. Consequence of Event of Default 45 SECTION 8.03. Notice of Default 45 ARTICLE IX - CHANGE IN CIRCUMSTANCES 45 SECTION 9.01. [This section 9.01 is reserved] 45 SECTION 9.02. Illegality 45 SECTION 9.03. Increased Cost 46 SECTION 9.04. Capital Adequacy 47 ARTICLE X - AGENT 48 SECTION 10.01. Appointment, Powers and Immuni ties. 48 SECTION 10.02. Rights of Agent as a Bank. 4 9 SECTION 10.03. Defaults. 49 SECTION 10.04. INDEMNIFICATION. 50 SECTION 10.05. Independent Credit Decisions. 50 SECTION 10.06. Several Commitments. 51 SECTION 10.07. Successor Agent. 51 ARTICLE XI - MISCELLANEOUS 51 SECTION 11.01. Notices 51 SECTION 11.02. No Waivers 52 SECTION 11.03. Expenses, etc. 52 SECTION 11.04. Set-Offs 52 SECTION 11.05. Taxes 53 SECTION 11.06. Amendments and Waivers 54 SECTION 11.07. Replacement of Banks 55 SECTION 11.08. Assignments and Participations 55 SECTION 11.09. Collateral 58 SECTION 11.10. Confidentiality 58 SECTION 11.11. Alternative Liquidity 59 SECTION 11.12. Governing Law 59 SECTION 11.13. WAIVER OF JURY TRIAL 59 SECTION 11.14. Counterparts; Integration 59 EXHIBITS A Form of Revolving Note B Form of Guaranty C Form of Borrower's Notice of Syndicated Borrowin g D Form of Agent's Notice of Syndicated Borrowing E Form of Money Market Quote Request F Form of Money Market Quote G Form of Notice of Money Market Borrowing H Form of Opinion I Form of Assignment and Acceptance Agreement SCHEDULES 1 Addresses of Banks' Lending Offices 2 Locations 3 Material Adverse Change 4 Litigation REVOLVING CREDIT AGREEMENT This REVOLVING CREDIT AGREEMENT (the or this "Agree ment") dated as of October 23, 1997, is among ADOLPH COORS COMPANY, a Colorado corporation (the "Borrower"), NATIONSBAN K OF

banking association, as co-agent for itself and the other Banks (in such capacity, together with its successors in such capacity, the "Co-Agent"), and each of the banks and other lending institutions which is a party hereto (as evidenced by the signature pages of this Agreement) or which from time to time may become a party hereto or any successor or assignee thereof (each a "Bank" and collectively the "Banks").

WITNESSETH:

WHEREAS, Borrower has requested from the Banks and the Banks are willing to make available in the amounts listed on the signature pages hereof to Borrower a revolving line of credit (the "Facility") in an aggregate amount not to exceed Two Hundred Million Dollars ($200,000,000) on the terms and conditions contained herein; and

WHEREAS, the term "Borrowing" denotes the aggregation of Loans of a single Type to be made by one or more Banks to the Borrower pursuant to Article II on a single date for a single Interest Period. For purposes of this Agreement, Borrowings are classified either by reference to the pricing of Loans constituting such Borrowing (e.g., a "Base Rate Borrowing" is a Borrowing comprised of Base Rate Loans) or by reference to the provisions of Article II under which participation therein is determined (i.e., a "Syndicated Borrowing" is a Borrowing comprised of simultaneous Syndicated Loans of the same Type in which all Banks participate in proportion to their Pro Rata Shares of Commitments pursuant to Section 2.01, while a "Bid Borrowing" is a Borrowing comprised of simultaneous Bid Loans of the same Type made by one or more Banks whose offer to make such Loans as a part of such Borrowing has been accepted by Borrower under the auction bid process pursuant to Section 2.03). Syndicated Loans may be made in Dollars or any other Available Currency.

NOW, THEREFORE, the parties hereto agree as follows: I. ARTICLE DEFINITIONS A. SECTION Definitions. The following terms, as used herein, have the following meanings (and words in the singular include the plural, and vice versa): "Adjusted LIBOR Rate" has the meaning set forth in Section 2.07(b). "Affiliate" means, as to any Person, any other Person that, directly or indirectly, controls, is controlled by or is under common control with, such Person. "Agent" means as set forth in the opening paragraph of this Agreement. "Agent's Notice of Syndicated Borrowing" means an Agent's Notice of Syndicated Borrowing pursuant to Section 2.02. "Applicable Margin" means, as of the date of determination, (a) with respect to a LIBOR Rate Loan or a Foreign Currency Rate Loan, the rate per annum, as set forth in the right-hand column below, based on the Rating (which shall be the higher of the two Ratings of Standard & Poor's Inc. and Moody's Investor Corporation or the Rating immediately below the higher of such two Ratings if the two Ratings are split by more than one Rating) deemed in effect on such day for Borrower's senior unsecured nonconvertible long-term indebtedness:

b) with respect to a Base Rate Loan, the Applicable Margin shall be zero. The Applicable Margin shall be determined on the last day of each calendar quarter of Borrower for the fiscal quarter immediately following (as such quarters are determined by Borrower pursuant to its customary accounting policy) with respect to the Ratings in effect on such date. "Assignee" means as specified in Section 11.08. "Assigning Bank" means a Bank which makes an assignment of all or part of its rights and obligations hereunder as specified in Section 11.08. "Assignment and Acceptance" means an assignment and acceptance entered into by a Bank and its Assignee and accepted by Agent pursuant to Section 11.08, in substantially the form of Exhibit I hereto. "Authorized Officer" means any of the following officers of the Borrower: the chairman or vice chairman of the board of directors, chief executive officer, chief financial officer, president, treasurer, any vice president (however designated), any assistant treasurer, any secretary, or any assistant secretary. "Available Currency" means U.S. Dollars and any Foreign Currency. "Bank" means each bank listed on the signature pages hereof as having a Commitment, and its successors and permissible assigns. "Base Rate" has the meaning set forth in Section 2.07(a). "Base Rate Loan" means any Loan under this Agreement made or maintained at the Base Rate. "Base U.S. Dollar Amount" means with respect to any Borrowing of the Loan originally borrowed in a Foreign Currency, the amount of U.S. Dollars specified in the Notice of Borrowing of which the Foreign Currency amount advanced is the Equivalent Amount on the date of such Borrowing, the amount of U.S. Dollars specified in the Borrower's request for redenomination pursuant to Section 2.02 of which the Foreign Currency amount to be redenominated is the Equivalent Amount as of the date of redenomination. "BHC" has the meaning set forth in Section 9.04(a). "Bid Borrowing" has the meaning set forth in the second Whereas clause to this Agreement. "Bid Loan" means any Money Market Loan made by a Bank as part of a Bid Borrowing pursuant to Section 2.03. "Borrower" means Adolph Coors Company, a Colorado corporation, and its successors and permissible assigns. "Borrower's Notice of Syndicated Borrowing" means a Borrower's Notice of Syndicated Borrowing pursuant to Section 2.02. "Borrowing" has the meaning set forth in the second Whereas clause to this Agreement. "Business Day" means a day other than a Saturday or Sunday and on which banks are open for business in New York City and on which wire transfers may be effectuated among member banks of the Federal Reserve System through use of the fedwire funds transfer system and if the applicable Business Day relates to any LIBOR Rate Loan, any Money Market LIBOR Loan or any Foreign Currency Loan, on which commercial banks are open for international business (including dealings in Dollar deposits) in the London interbank market. "Capital Lease Obligations" of any Person means, as of any date of determination, the aggregate amount of lease obligations that would, in accordance with generally accepted accounting principles, be required to be capitalized on a balance sheet of such Person at such date.

Rating Applicable Margin A/A2 or better 15.0 basis points A-/A3 15.0 basis points BBB+/Baa 1 16.5 basis points BBB/Baa2 21.5 basis points BBB-/Baa3 or lower 30.0 basis points

"Capitalization" of the Borrower means, as of any date of determination (without duplication), the sum of Total Debt and Net Worth of the Borrower. "Change in Control" means the occurrence, after the Effective Date of this Agreement, of (i) any Person or two or more Persons acting in concert or as a "group" (within the meaning of Rule 13d-3 (the "Rule") of the SEC under the Exchange Act) acquiring "beneficial ownership" (within the meaning of the Rule) directly or indirectly, of securities of the Borrower (or other securities convertible into such securities) representing 50% or more of the combined voting power of all securities of the Borrower entitled to vote in the election of directors, (ii) during any period of up to 24 consecutive months, commencing before or after the Effective Date of this Agreement, individuals who at the beginning of such 24-month period were directors of the Borrower ceasing for any reason to constitute a majority of the Board of Directors of the Borrower unless the individuals replacing such individuals were nominated by the Board of Directors of the Borrower, or (iii) any Person or two or more Persons acting in concert or as a group acquiring by contract or otherwise, or entering into a contract or arrangement that upon consummation will result in its or their acquisition of such beneficial ownership as described in clause (i); provided, that, the Person or group of Persons referred to in clauses (i) and (iii) of this definition shall not apply to or include any Person who is a trustee or beneficiary of the Adolph Coors, Jr. Trust and the successors of such Person, or any Person or any group of Persons in which one or more of the Persons who are trustees or beneficiaries of the Adolph Coors, Jr. Trust and their successors are members. "Closing Date" means October 23, 1997, the date of this Agreement. "Co-Agent" has the meaning set forth in the opening paragraph of this Agreement. "Code" means the Internal Revenue Code of 1986, as amended, or any successor statute. "Commitment" means, as to any Bank, the obligation of such Bank to make or continue Loans and incur or participate in Letter of Credit Liabilities hereunder in an aggregate principal amount at any one time outstanding up to but not exceeding the amount set forth opposite the name of such Bank on the signature pages hereto under the heading "Commitment" or, if such Bank is a party to an Assignment and Acceptance, the amount of the "Commitment" set forth in the most recent Assignment and Acceptance of such Bank, as the same may be reduced or terminated pursuant to Section 2.17 or 8.02, and "Commitments" means such obligations of all Banks. As of the execution of this Agreement, the aggregate principal amount of the Commitments is $200,000,000. "Consolidated Subsidiary" of any Person means at any date, any Subsidiary or other entity the accounts of which, in accordance with GAAP, would be consolidated with those of such Person in its consolidated financial statements as of such date. "Debt" of any Person means, at any date, without duplication, (i) all obligations of such Person for borrowed money, (ii) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments, (iii) all noncontingent obligations of such Person in respect of letters of credit or other similar instruments, (iv) all Capital Lease Obligations of such Person as lessee under capital leases, (v) all Debt of others secured by a Lien on any asset of such Person, whether or not such Debt is assumed by such Person, and (vi) all direct guarantees by such Person of Debt (as defined in clause (i) through (v) of this definition) of other Persons; provided that (x) if Debt referred to in clause (v) above is without recourse to the Borrower or any Subsidiary, the amount of such Debt shall be calculated at the lesser of (A) the aggregate outstanding principal amount of such Debt or (B) the aggregate fair realizable value of the assets securing such Debt, (y) the amount of any Debt referred to in clause (vi) above shall be deemed to be the reasonably anticipated liability in respect thereof as determined in accordance with GAAP, and (z) when calculating the amount of Debt of the Borrower and its Consolidated Subsidiaries on a consolidated basis, obligations of the Borrower or any Consolidated Subsidiary that are eliminated in consolidation pursuant to generally accepted accounting principles shall be eliminated. "Default" means any condition or event which constitutes an Event of Default or which with the giving of notice or lapse of time, or both, would become an Event of Default. "Dollars" or "$" means United States dollars or other lawful currency of the United States. "Effective Date" has the meaning set forth in Section 3.01. "Eligible Assignee" means (i) a commercial bank organized under the laws of the United States, or any State thereof, having Total Assets in excess of $5,000,000,000, and which is in compliance with all minimum capital requirements imposed by its primary banking regulator; (ii) a commercial bank organized under the laws of any other country which is a member of the Organization for Economic Cooperation and Development or a political subdivision of any such country, and having Total Assets in excess of $5,000,000,000; provided, that, such bank is acting through a branch or agency located in the United States; (iii) the central bank of any country which is a member of the Organization for Economic Cooperation and Development; (iv) any Bank or Affiliate of a Bank; (v) a finance company, insurance company or other financial institution or fund (whether a corporation, partnership or other entity) which is engaged in making, purchasing or otherwise investing in commercial loans in the ordinary course of its business, and having Total Assets in excess of $5,000,000,000; and (vi) any other Person consented to by Agent and the Borrower, which consents may not be unreasonably withheld. "Environmental Laws" mean any and all laws, statutes, ordinances, rules, regulations, judgments, orders, decrees, permits, licenses, or other governmental restrictions or requirements of a Governmental Authority relating to the environment, which are binding on Borrower. "Equivalent Amount" means the amount of a Foreign Currency which is equivalent to a given amount of U.S. Dollars as of the Relevant Date, determined by using the Spot Rate on the date two Business Days prior to the Relevant Date. "ERISA" means the Employee Retirement Income Security Act of 1974, as amended. "ERISA Affiliate" means all trades or businesses (whether or not incorporated) under common control which, together with the Borrower, are treated as a single employer under Section 414(c) of the Code. "Euro-Dollar Reserve Percentage" has the meaning set forth in Section 2.07(b). "Event of Default" has the meaning set forth in Section 8.01. "Exchange Act" means the Securities Exchange Act of 1934, as amended. "Extension Date" means the date, if any, from time to time to which the Termination Date is actually extended pursuant to Section 2.18. "Facility" has the meaning set forth in the first Whereas clause to this Agreement. "Facility Fee" has the meaning set forth in Section 2.16(a). "Federal Funds Rate" has the meaning set forth in Section 2.07(a). "Foreign Currency" means British Pounds Sterling, Canadian Dollars, French Francs, German Deutsche Marks, Japanese Yen, Spanish Pesetas or any other freely available currency which is freely transferable and freely convertible into Dollars and in which dealings and deposits are carried on in the London interbank market, which shall be requested by the Borrower and approved by each Bank. "Foreign Currency Loan" means a Loan under the Agreement made or maintained in a Foreign Currency. "Foreign Currency Rate" has the meaning set forth in Section 2.07(c). "Governmental Authority" means the United States of America, any state or other political subdivision thereof and any Person exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to the government of the same. "Guarantor" means each of (i) Coors Brewing Company, a Colorado corporation and the wholly owned Subsidiary of the Borrower, and (ii) such additional Subsidiaries of the Borrower (whether now or hereafter a Subsidiary), if any, as shall be necessary so that the aggregate assets of the Borrower and such Guarantors at all times shall represent at least eighty percent (80%) of

the total assets of the Borrower and its Consolidated Subsidiaries. "Intangible Assets" of a Person means, to the extent included in such Person's Total Assets, all of the following: (i) goodwill, organizational expenses, research and development expenses, unamortized debt discount and expense, trademarks, trade names, copyrights, patents, patent applications, licenses and rights in any thereof, and other similar intangibles, and (ii) any investments in and advances to nonconsolidated Affiliates, all as determined in accordance with generally accepted accounting principles, on a consolidated basis. "Interest Period" with respect to each Type of Loan has the meaning set forth in Section 2.05, as applicable. "Issuing Bank" means NationsBank or such other Bank which is a commercial bank as Borrower and NationsBank may mutually designate from time to time which agrees to be the issuer of Letters of Credit. "Law" means any law, constitution, statute, treaty, regulation, rule, ordinance, order, injunction, writ, decree or award of any Governmental Authority, which is binding on Borrower. "Lending Offices" means, as to any Bank, the lending branches or offices specified on Schedule 1 hereto with respect to any Type of Loan, as applicable, or such other of its branches or offices as such Bank may from time to time designate by notice to the Borrower. "Letter of Credit" means any standby or commercial letter of credit issued by the Issuing Bank for the account of Borrower pursuant to this Agreement. "Letter of Credit Agreement" means, with respect to each Letter of Credit to be issued by the Issuing Bank therefor, the letter of credit application and reimbursement agreement which such Issuing Bank requires to be executed by Borrower in connection with the issuance of such Letter of Credit. "Letter of Credit Liabilities" means, at any time, the aggregate undrawn face amount of all outstanding Letters of Credit and all unreimbursed drawings under Letters of Credit. "LIBOR Auction" means a solicitation of Money Market Quotes setting forth Money Market Margins based on the London Interbank Offered Rate pursuant to Section 2.03. "LIBOR Rate" has the meaning set forth in Section 2.07(b). "LIBOR Rate Loan" means a Loan under this Agreement made or maintained at the LIBOR Rate. "Lien" means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of such asset, including the interest of a lender or lessor under any conditional sale agreement, capital lease or other title retention agreement relating to such asset. "Loan" means any Syndicated Loan or any Bid Loan and "Loans" means Syndicated Loans and Bid Loans or any combination of the foregoing, as the context requires. Syndicated Loans also include Foreign Currency Loans. "Loan Documents" means this Agreement, each Revolving Note executed by Borrower hereunder, the Letter of Credit Agreements, each guaranty executed in connection with this Agreement and any other documents or agreements executed in connection therewith, and also includes any and all renewals, extensions, modifications or amendments of any of the foregoing. "Loan Party" means Borrower and each Guarantor. "London Interbank Offered Rate" has the meaning set forth in Section 2.07(b). "Majority Banks" means at any time Banks having at least 51% of the aggregate amount of the Commitments, or, if the Commitments have been terminated, the Banks having at least 51% of the aggregate unpaid outstanding principal amount of all Loans. "Managing Agent" means as set forth in the opening paragraph of this Agreement. "Money Market Absolute Rate" has the meaning set forth in Section 2.07(d). "Money Market Absolute Rate Auction" means a solicitation of Money Market Quotes setting forth Money Market Absolute Rates pursuant to Section 2.03. "Money Market Absolute Rate Loan" means a Loan made by a Bank pursuant to an Absolute Rate Money Market Auction or maintained as a Money Market Absolute Loan under this Agreement. "Money Market LIBOR Loan" means a Loan made by a Bank pursuant to a LIBOR Auction or maintained as a Money Market LIBOR Loan under this Agreement. "Money Market LIBOR Rate" has the meaning set forth in Section 2.07(c). "Money Market Loan" means a Loan under this Agreement made or maintained as a Money Market LIBOR Loan or a Money Market Absolute Rate Loan. "Money Market Margin" has the meaning set forth in Section 2.03(d)(ii)(D). "Money Market Quote" means an offer by a Bank to make a Money Market Loan in accordance with Section 2.03(d). "Money Market Quote Request" means a request by the Borrower to the Banks to make offers to make a Money Market Loan in accordance with Section 2.03(c). "NationsBank" means NationsBank of Texas, N.A., a national banking association, in its individual capacity as a Bank. "Net Tangible Assets" means the Total Assets of Borrower and its Consolidated Subsidiaries less Intangible Assets (to the extent included in such Total Assets) all as computed in accordance with generally accepted accounting principles as of the last day of the fiscal quarter of Borrower most recently ended. "Net Worth" of any Person means, as of any date of determination, the total amount of shareholders' equity that would be shown on the consolidated balance sheet of such Person and its Consolidated Subsidiaries, as determined in accordance with generally accepted accounting principles. "New Equity Issuance" means the sale of capital stock by the Borrower or the equity resulting from the conversion of convertible debt securities, as prescribed by generally accepted accounting principles. "Notice of Borrowing" means a Borrower's Notice of Syndicated Borrowing or Notice of Money Market Borrowing issued by Borrower, as applicable, pursuant to Section 2.02 or Section 2.03. "Obligations" means (i) all obligations and indebtedness now or hereafter owing by Borrower under this Agreement, or otherwise arising in connection with this Agreement or any of the other Loan Documents, including without limitation, all loan repayment obligations, accrued interest and fees, costs and expenses as provided by this Agreement or any of the other Loan Documents, and any other amounts from time to time owing by Borrower to Agent, Co-Agent, Managing Agent or any Bank in connection therewith; (ii) any and all other indebtedness and obligations of every kind and character now or hereafter owing by Borrower to Agent, Co-Agent, Managing Agent or any Bank, whether direct or indirect, primary or secondary, joint, several, or joint and several, fixed or contingent, including indebtedness and obligations, if any, which may be assigned to or acquired by Agent, Co-Agent, Managing Agent or any Bank; and (iii) any and all renewals and extensions of the foregoing, or any part thereof. "Options" means the interest rate options available to the Borrower for selection or request for quotation with respect to the interest rate to be borne by a Loan, pursuant to the applicable Notice of Borrowing. "PBGC" means the Pension Benefit Guaranty Corporation or any entity succeeding to any or all of its functions under ERISA. "Person" means an individual, a corporation, a partnership, an association, a trust or any other entity or organization, including a government or political subdivision or an agency or instrumentality thereof. "Plan" means, at any time, an employee pension benefit plan which is covered by Title IV of ERISA or subject to the minimum funding standards under Section 412 of the Code and is either maintained or contributed to by Borrower or any ERISA Affiliate. "Principal Plant" means any brewery, or any manufacturing, processing or packaging plant owned as of the Effective Date or hereafter acquired by the Borrower or any Subsidiary, but shall not include

(a) any plant listed or referred to on Schedule 2 attached hereto, (b) any brewery, or any manufacturing, processing or packaging plant of the Borrower or any Subsidiary which the Board of Directors of Borrower shall have determined (successive determinations and redeterminations being permitted without restrictions) is not of material importance to the total business conducted by the Borrower and any Restricted Subsidiary, (c) any plant which the Board of Directors of Borrower shall have determined is used primarily for transportation, marketing or warehousing, including as of the Effective Date those plants listed on Schedule 2 attached hereto (successive determinations and redeterminations being permitted without restriction), (d) any real property which does not contain, and is not material to the operation of, any brewery, or any manufacturing, processing or packaging plant owned as of the Effective Date or hereafter acquired by the Borrower or any Subsidiary that constitutes a "Principal Plant" under the other provisions of this definition, or (e) any brewery, or any manufacturing, processing or packaging plant or group of plants hereafter acquired by the Borrower or any Subsidiary from any Person or group of related Persons in one transaction or a series of related transactions if the aggregate purchase price (which amount shall equal the sum of any cash or cash equivalents and the value of any other consideration paid by the Borrower or such Subsidiary and the principal amount of any Debt assumed by the Borrower or such Subsidiary from such Person or group of related Persons) for such plant (and any other plants acquired by the Borrower or any Subsidiary from such Person or group of related Persons as part of such transaction or series of transactions) does not exceed $50 million. "Pro Rata Share" means, as to any Bank, the percentage equivalent of a fraction, the numerator of which is the amount of the outstanding Commitment of such Bank (or, if such Commitment has terminated or expired, the outstanding principal amount of the Loans and Letter of Credit Liabilities of such Bank) and the denominator of which is the aggregate amount of the outstanding Commitments of all Banks (or, if such Commitments have terminated or expired, the aggregate outstanding principal amount of the Loans and Letter of Credit Liabilities of all Banks), as adjusted from time to time in accordance with Section 11.08. "Quarter End" means the last Business Day of each March, June, September and December of each year during the term of this Agreement. "Rating" means a rating category (including any numerical or other modifiers) actually assigned by Standard & Poor's Rating Group or Moody's Investors Service, Inc. and any successor thereto which is a nationally recognized rating agency, to a Person's senior unsecured nonconvertible indebtedness or, if no such rating category is at the time of determination so assigned, an implied rating category that is one rating category (including any numerical or other modifiers) higher than the rating category so assigned to such Person's senior unsecured nonconvertible unenhanced subordinated indebtedness; provided, however, that if an actual or implied rating category is not at any time assigned by at least one such rating agency to the Borrower's senior unsecured nonconvertible indebtedness, the Borrower will apply for a private rating from at least one such rating agency with respect to the indebtedness of the Borrower under this Agreement, and the rating category so obtained shall be used for the purposes of this definition as it relates to the Borrower's senior unsecured nonconvertible indebtedness. If no rating is assigned and the Banks and the Borrower cannot agree on a rating, the Banks and the Borrower agree that such disagreement will be settled through an arbitration proceeding conducted in accordance with the rules of the American Arbitration Association. "Reference Rate" for any day of a relevant Interest Period means the per annum rate of interest established from time to time by NationsBank as its "prime rate." It is a rate set by NationsBank based upon various factors including NationsBank's costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced rate. Any change in the prime rate announced by NationsBank shall take effect at the opening of business on the day specified in the public announcement of such change. "Refunding Borrowing" means a Borrowing which, after application of the proceeds thereof, results in no net increase in the aggregate outstanding principal amount of Loans made by any Bank. "Register" has the meaning set forth in Section 2.10. "Regulation U" and "Regulation X" means those Regulations so designated of the Board of Governors of the Federal Reserve System, as in effect from time to time. "Reimbursement Obligation" means the obligation of Borrower to reimburse the Issuing Bank for any drawing under a Letter of Credit. "Relevant Date" means, with respect to any amounts denominated or to be denominated in a Foreign Currency, the date of Borrowing or the date of any redenomination or payment pursuant to this Agreement in such Foreign Currency or the date of any other calculation with respect to such Foreign Currency, as applicable. "Restricted Subsidiary" means (i) any Subsidiary which owns or operates a Principal Plant, except any Subsidiary incorporated, or the principal place of business of which is located, outside the present fifty states of the United States of America and the District of Columbia, (ii) any Guarantor, and (iii) any other Subsidiary which the Board of Directors of Borrower, shall classify as a Restricted Subsidiary until such time as the Borrower may, by further Board action, classify such Subsidiary as an Unrestricted Subsidiary, successive such classifications being permitted without restriction; provided, however, that the Borrower shall not make any such classification, if immediately after giving effect to such classification or successive classification, the Borrower and any one or more Restricted Subsidiaries could not create, assume, guarantee or suffer to exist $1.00 of additional Debt pursuant to clause (c) of Section 6.01 hereof, with the effect that any such classification or successive classification made in violation of this proviso shall be void and such Subsidiary shall maintain its prior classification. "Revolving Note" means each of the promissory notes executed by Borrower payable to the order of a Bank evidencing loans under this Agreement, as provided in Section 2.10 and in the form attached hereto as Exhibit A, and includes any and all renewals, extensions, amendments or modifications thereof. "SEC" means the Securities and Exchange Commission, or any successor organization. "Spot Rate" means, with respect to any day, the rate determined on such date on the basis of the offered rates, as reflected on page 5 of the Telerate report at or about 10:00 a.m. (Dallas, Texas time) (a) with respect to the determination of the U.S. Dollar Amount, to purchase U.S. Dollars with a particular Foreign Currency and (b) with respect to the determination of the Equivalent Amount, to purchase a particular Foreign Currency with U.S. Dollars, provided that, if at least two such offered rates appear on such display, the rate shall be the arithmetic mean of such offered rates and, if no such offered rates are so displayed, the Spot Rate shall be determined by the Agent on the basis of the arithmetic mean of such offered rates notified to the Agent by NationsBank in accordance with its normal practice. "Subsidiary" means any corporation or other entity of which securities or other ownership interests having ordinary voting power to elect a majority of the board of directors or other persons performing similar functions are at the time directly or indirectly owned by the Borrower. "Syndicated Borrowing" has the meaning set forth in the second Whereas clause to this Agreement. "Syndicated Loan" means any Base Rate Loan, LIBOR Rate Loan and Foreign Currency Loan, as applicable, made by a Bank as a part of a Syndicated Borrowing pursuant to Section 2.01 and Section 2.04, as applicable. "Termination Date" means September 30, 2002 or such later date as extended pursuant to Section 2.18, or if such day is not a Business Day, the next succeeding Business Day. "Total Assets" of any Person means all property, whether real, personal, tangible, intangible or otherwise, which, in accordance with generally accepted accounting principles, would be included in determining total assets as shown on the assets portion of a consolidated balance sheet of such Person and its Consolidated Subsidiaries.

"Total Debt" means, as of any date of determination, all Debt of the Borrower and its Consolidated Subsidiaries (without duplication). "Type" means, with respect to a Loan, a single category of Loan made under this Agreement with reference to the pricing or interest rate of such Loan, e.g. Base Rate Loan, Money Market LIBOR Rate Loan or Foreign Currency Rate Loan. "Unrestricted Subsidiary" means, at the time of any determination, any Subsidiary of Borrower that is not a Restricted Subsidiary. "US Dollar Amount" means (a) in the case of any amount denominated or redenominated in U.S. Dollars, such amount, and (b) in the case of any amount denominated or redenominated in a Foreign Currency, the amount of U.S. Dollars which is equivalent to a given amount of such Foreign Currency as of the Relevant Date, determined by using the Spot Rate on the date two Business Days prior to the Relevant Date (unless another date is specified in this Agreement). B. SECTION Accounting Terms and Determinations. Unless otherwise specified or defined herein, all accounting terms used herein shall be interpreted, all accounting determinations and financial covenant determinations hereunder shall be made, and all financial statements required to be delivered hereunder shall be prepared, in accordance with generally accepted accounting principles as in effect from time to time, applied on a basis consistent (except for changes concurred in by the Borrower's independent public accountants) with the most recent audited consolidated financial statements of the Borrower and its Consolidated Subsidiaries delivered to the Banks. II. ARTICLE THE CREDITS A. SECTION Syndicated Borrowings. 1. The Commitments. Each Bank severally agrees, on the terms and conditions set forth in this Agreement, to make Base Rate Loans, LIBOR Rate Loans and Foreign Currency Rate Loans to the Borrower pursuant to this Section 2.01 upon the request of the Borrower from time to time during the period from and including the Effective Date up to but excluding the Termination Date in an aggregate principal amount not exceeding at any one time outstanding the amount of such Bank's Commitment (less the amount of such Bank's Pro Rata Share of all Letter of Credit Liabilities). At any time when one or more Money Market Loans is outstanding, each Bank's Commitment shall be reduced and deemed used for all purposes by its Pro Rata Share of the aggregate amount of all such outstanding Money Market Loans. The failure of any Bank to make a Syndicated Loan shall not relieve any other Bank of its obligation to lend under this Section 2.01, but no Bank shall be responsible for any such failure by any other Bank. 2. Limitations on Syndicated Loans. Notwithstanding anything in this Agreement to the contrary, the aggregate principal amount outstanding under all Loans (Syndicated and Bid Loans taken together) under this Agreement and all Letter of Credit Liabilities at any one time shall not exceed the aggregate amount of the Commitments of all Banks in effect at such time. 3. Borrowing Amounts. Each Borrowing with respect to Base Rate Loans, LIBOR Rate Loans and Foreign Currency Loans under this Section 2.01 shall be in an aggregate principal amount of at least $1,000,000 and integral multiples of $1,000,000 in excess thereof (except that any such Borrowing may be in the aggregate amount of the unused Commitments). One or more different Syndicated Borrowings may be made on the same day. 4. Revolving Credit. Within the limits set forth in this Section 2.01, and subject to the provisions of this Agreement, the Borrower may borrow, repay, or prepay and reborrow at any time prior to the Termination Date under this Section 2.01. 5. Ratable Basis. Each individual Syndicated Borrowing shall consist of Syndicated Loans of the same Type for the same Interest Period made on the same day simultaneously by the Banks ratably in proportion to the amounts of their Commitments. 6. Foreign Currency Election. The Borrower may, in connection with any Notice of Borrowing delivered pursuant to Section 2.02, direct that such Borrowing be denominated and made in any Available Currency. If any such Notice of Borrowing directs that a Foreign Currency denominated tranche be part of the Borrowing and such notice is not received by Agent by 10:00 a.m. (Dallas, Texas time) at least three Business Days prior to the proposed Borrowing, then such tranche shall be denominated in U.S. Dollars. Any agreement or obligation of the Banks to provide any portion of a Borrowing in a Foreign Currency pursuant to this Agreement shall in all cases be subject to the condition that no circumstance described in Section 2.08 shall have occurred (as determined in good faith by Agent) in the London interbank Euro-currency market or otherwise after request therefor by the Borrower and before the relevant date of Borrowing. If Agent has determined that such a change has occurred, then Agent shall forthwith give notice thereof to the Borrower and to each Bank, and the procedures set forth in Section 2.08 shall be applicable. 7. Advances of Available Currency in Equivalent Amount. If the Borrower requests (pursuant to this Section 2.01) that any Borrowing of the Loan be denominated in a Foreign Currency, the Banks shall, subject to compliance by the Borrower with the terms and conditions of this Agreement, make their advances of the Borrowing in such Foreign Currency in an aggregate amount equal to the Equivalent Amount of the Base U.S. Dollar Amount of the Borrowing to be funded in such Foreign Currency. 8. Delivery of Advances in Available Currency. If any Borrowing of the Loan is being redenominated in whole or in part in an Available Currency (the "Applicable Available Currency") for the next succeeding Interest Period ( such Borrowing having been denominated in another Available Currency during the Interest Period then ending), each Bank will make an amount equal to its Pro Rata Share of the Equivalent Amount in such Applicable Available Currency of the Base U.S. Dollar Amount of the Borrowing (or the relevant portion thereof) to be denominated in such Applicable Available Currency during the next succeeding Interest Period available to Agent on the first day of such next succeeding Interest Period. Agent shall, subject to the provisions of Section 2.01 (j), make each such amount of such Applicable Available Currency available to the Borrower on such date and in like currency and funds as received by Agent from the Banks in the manner provided in Section 2.15, and the Borrower on the last day of the Interest Period then ending shall repay the amount of such Borrowing (or the relevant portion thereof) outstanding in the other Available Currency during the Interest Period then ending (with accrued interest thereon in the other Available Currency). 9. Obligation of Agent to Deliver Advances and Indemnification by Borrower. If Borrower is required to repay any amounts on the last day of any Interest Period pursuant to this Section 2.01, Agent shall only make any amounts to be advanced by the Banks available to the Borrower on the first day of the next succeeding Interest Period against receipt by Agent, in accordance with this Agreement, of the relevant amounts to be repaid by the Borrower pursuant to this Section 2.01. The Borrower hereby agrees that it shall indemnify Agent, Co-Agent, Managing Agent and each Bank, and hold Agent, Co-Agent, Managing Agent and each Bank harmless from and against, any and all funding or foreign exchange costs, losses or expenses that Agent, Co-Agent, Managing Agent and the Banks may suffer, sustain or incur as a consequence of a failure by the Borrower to promptly pay, when due, any amounts required to be paid by the Borrower. 10. Currency of Payment. Any currency specified in accordance with this Agreement shall be the currency of account and of payment in all events. The payment obligation of the Borrower hereunder shall not be discharged by an amount paid in another currency, whether pursuant to a judgment or otherwise, to the extent that the amount so paid upon conversion by Agent or the Banks (as applicable) to the specified currency

under normal and reasonable banking procedures does not yield at the place when payment is due the amount of the specified currency due hereunder. In the event that any payment by or on behalf of the Borrower, whether pursuant to a judgment or otherwise, upon such conversion and after the deduction of all fees, costs and expenses relating thereto does not result in payment of such amount of the specified currency at the place payment is due, Agent and each Bank shall be entitled to receive from the Borrower, and shall have a separate cause of action for, the deficiency in respect of the payments due to each, respectively. B. SECTION Notice of Syndicated Borrowings. 1. Notice to Agent. In order to effect a Syndicated Borrowing, the Borrower shall give Agent a Borrower's Notice of Syndicated Borrowing, in writing or by telephone, prior to 10:00 a.m. (Dallas, Texas time) on (x) the same Business Day of each Base Rate Borrowing (e.g., notice on Monday, borrow on Monday), (y) three Business Days before each LIBOR Rate Borrowing (e.g., notice on Monday, borrow on Thursday), or (z) three Business Days before any Foreign Currency Borrowing (e.g. notice on Monday, borrow on Thursday), specifying: a) the date of such proposed Borrowing, which shall be a Business Day, b) the aggregate principal amount of such Borrowing. c) the interest rate Option (Base Rate, LIBOR Rate and Foreign Currency Rate, if applicable) selected for such Borrowing, d) the duration of the Interest Period applicable to such Borrowing, and e) if such Borrowing is to be made in Foreign Currency, the designated Foreign Currency and the Base U.S. Dollar Amount of such tranche. 2. Irrevocable; Confirmation. Once given to Agent, a Borrower's Notice of Syndicated Borrowing is irrevocable and binding on the Borrower. If the Borrower gives a Notice of Syndicated Borrowing by telephone, the Borrower shall promptly confirm it by telex or facsimile copy, substantially in the form of Exhibit C attached hereto. In the event of a discrepancy between Agent's record of such telephone notice and the Borrower's confirmation thereof, Agent's record shall be determinative, absent demonstrable error. 3. Notice to Banks. Promptly after receipt by Agent of such Borrower's Notice of Syndicated Borrowing, Agent shall deliver an Agent's Notice of Syndicated Borrowing to each Bank in writing or by telephone. If Agent delivers such Agent's Notice of Syndicated Borrowing to the Banks by telephone, Agent shall promptly confirm such delivery by telex or facsimile copy substantially in the form of Exhibit D. C. SECTION Money Market Borrowings. 1. The Money Market Option. In addition to Syndicated Borrowings pursuant to Section 2.01 and, subject to subsection (b) below irrespective of the amount of a Bank's or any other Bank's Commitment, the Borrower may, as set forth in this Section 2.03, request the Banks to make offers to make Money Market Loans to the Borrower from time to time during the period from and including the Effective Date up to but excluding the Termination Date. The Banks may, but shall have no obligation to, make such offers and the Borrower may, but shall have no obligation to, accept any such offers, in each case in the manner set forth in this Section. 2. Limitation on Bid Loans. Notwithstanding anything in this Agreement to the contrary, the aggregate principal amount outstanding under all Loans (Syndicated and Bid Loans taken together) under this Agreement and all Letter of Credit Liabilities at any one time shall not exceed the aggregate amount of the Commitments of all Banks in effect at such time. 3. Money Market Quote Request. In order to request offers to make Money Market Loans under this Section 2.03, Borrower shall give Agent, in writing or by telephone, a Money Market Quote Request substantially in the form of Exhibit E hereto not later than 11:00 a.m. (Dallas, Texas time) (x) five Business Days before the date of the Borrowing proposed therein, in the case of a LIBOR Auction (e.g., request on Monday, borrow on the next Monday), or (y) one Business Day before the date of Borrowing proposed therein, in the case of an Absolute Rate Money Market Auction (e.g., request on Monday, borrow on Tuesday), specifying: a) the date of such proposed Borrowing, which shall be a Business Day, b) the aggregate amount of such proposed Borrowing, which shall be at least $1,000,000 and integral multiples of $1,000,000 in excess thereof, c) the duration of the Interest Period applicable thereto, and d) whether the Money Market Quotes requested are to set forth a Money Market Margin or a Money Market Absolute Rate. If the Borrower gives a Money Market Quote Request by telephone, the Borrower shall promptly confirm it by telex or facsimile copy. In the event of a discrepancy between Agent's record of such telephone notice and the Borrower's confirmation thereof, Agent's record shall be determinative, absent demonstrable error. The Borrower may request offers to make Money Market Loans for more than one Interest Period in a single Money Market Quote Request. One or more different Money Market Borrowings may be made on the same day. 1. Promptly after receipt by Agent of such Money Market Quote Request, Agent shall deliver such request to each Bank in writing or by telephone. If Agent delivers such Money Market Quote Request to the Banks by telephone, Agent shall promptly confirm such delivery by telex or facsimile copy. 2. Submission and Contents of Money Market Quotes. a) Each Bank may, at its option, submit a Money Market Quote containing an offer or offers to make Money Market Loans in response to any Money Market Quote Request. Each Money Market Quote must comply with the requirements of this subsection (d) and must be submitted to Agent by telex, facsimile copy or hand delivery not later than (w) 10:00 a.m. (Dallas, Texas time) four Business Days before the proposed Borrowing, in the case of a LIBOR Auction, or (x) 10:00 a.m. (Dallas, Texas time) on the same Business Day of the proposed Borrowing, in the case of an Money Market Absolute Rate Auction; provided, however, if Agent in its individual capacity as a Bank elects to submit a Money Market Quote to the Borrower, it shall deliver a written copy of such quote to each other Bank by telex or facsimile copy not later than (y) 9:30 a.m. (Dallas, Texas time) four Business Days before the proposed Borrowing, in the case of a LIBOR Auction, or (z) 9:30 a.m. (Dallas, Texas time) on the same Business Day of the proposed Borrowing, in the case of an Money Market Absolute Rate Auction. Subject to Articles III and VIII, once given to the Borrower, any Money Market Quote shall be irrevocable and binding on the quoting Bank. By 11:30 a.m. on the day of its receipt of a Money Market Quote from each Bank that submits such a quote, Agent shall deliver to the Borrower by telex or facsimile transmission a copy of each such Money Market Quote. The failure of any Bank to make a Money Market Loan accepted by the Borrower pursuant to this Section 2.03 shall not relieve any other Bank of its obligation to make a Money Market Loan accepted by the Borrower pursuant to this Section 2.03, but no Bank shall be responsible for any such failure by any other Bank. b) Each Money Market Quote shall be in substantially the form of Exhibit F hereto and shall in any case specify: (1) the proposed date of Borrowing, which shall be as specified in the Money Market Quote Request, (2) the proposed Interest Period(s) for which each such offer is being made, which shall be as specified in the Money Market Quote Request, (3) the principal amount of the Money Market Loan for which each such offer is being made, which (x) may be equal to, more than or less than the Commitment of the quoting Bank and may specify a minimum and maximum, (y) must be at least $1,000,000 and (z) may not exceed the

aggregate principal amount of Money Market Loans for which offers were requested, (4) in the case of a LIBOR Auction, the margin above or below the applicable London Interbank Offered Rate (the "Money Market Margin") offered for each such Money Market Loan, expressed as a percentage (rounded to the nearest 1/100th of 1 percent) to be added to or subtracted from such base rate, (5) in the case of an Money Market Absolute Rate Auction, the rate of interest per annum (rounded to the nearest 1/100th of 1 percent), offered for each such Money Market Loan, and (6) the identity of the quoting Bank. c) Any Money Market Quote shall be disregarded and be of no force and effect if it: (1) does not substantially comply with the provisions of subsection (d)(ii) above, (2) contains qualifying, conditional or similar language, (3) proposes terms other than or in addition to those set forth in the applicable Money Market Quote Request, or (4) arrives after the time set forth in subsection (d)(i). 3. Acceptance and Notice by Borrower. a) Not later than (x) 11:30 a.m. (Dallas, Texas time) three Business Days before the proposed date of Borrowing, in the case of a LIBOR Auction, or (y) 11:30 a.m. (Dallas, Texas time) on the same Business Day of the proposed Borrowing, in the case of an Money Market Absolute Rate Auction, the Borrower shall notify, in writing or by telephone, Agent regarding the Money Market Quotes for those Banks that have made offers in accordance with subsection (d) of this Section 2.03 either that (A) the auction and the proposed Money Market Borrowing is canceled for any reason or (B) one or more of such offers contained in the applicable Money Market Quotes is accepted. Failure by Borrower to deliver timely notice shall be deemed to be a notice of cancellation except with the consent of any Bank the offer of which is accepted. b) In the case of acceptance of one or more of such offers, Borrower shall give notice (a "Notice of Money Market Borrowing"), in writing or by telephone, within the time period specified in clause (i) of this subsection (e) of Section 2.03, to Agent, in substantially the form of Exhibit G hereto, specifying: (1) whether one or more of such Bank's offers have been accepted or rejected, (2) if accepted, the aggregate amount of each Money Market Loan to be made by each such Bank as part of such Borrowing, the applicable Interest Period, and the applicable Money Market Absolute Rate or Money Market Margin, (3) the aggregate principal amount of offers of all Banks for each Interest Period that have been accepted, and (4) the aggregate principal amount of all Loans outstanding under the Agreement after taking into consideration the Loans accepted in such Borrowing. c) The Borrower may accept in whole or in part any Money Market Quote meeting the requirements of subsection (d); provided that: (1) the aggregate principal amount of each Money Market Borrowing shall not exceed the aggregate amount requested by Borrower in the related Money Market Quote Request, (2) the aggregate principal amount of each Money Market Loan to be made by any Bank shall be subject to any minimum or maximum specified by such Bank in its Money Market Quote, (3) the principal amount of each Money Market Borrowing must be at least $5,000,000 and integral multiples of $1,000,000 in excess thereof, and (4) acceptance of offers may only be made on the basis of ascending Money Market Margins or Money Market Absolute Rates, as the case may be. If the Borrower gives Notice of Money Market Borrowing by telephone, the Borrower shall promptly confirm it by telex or facsimile copy. In the event of a discrepancy between Agent's record of such telephone notice and the Borrower's confirmation thereof, Agent's record shall be determinative, absent demonstrable error. Promptly after receipt by Agent of a notice of cancellation from the Borrower or receipt of a Notice of Money Market Borrowing, as applicable, Agent shall deliver such notice to each Bank (including those Banks which did not participate in the bid process) in writing or by telephone. If Agent delivers either such notice to the Banks by telephone, Agent shall promptly confirm such delivery by telex or facsimile copy. 1. Allocation by Borrower. If offers are made by two or more Banks with the same Money Market Margins or Money Market Absolute Rates, as the case may be, for a greater aggregate principal amount than the amount in respect of which offers are accepted for the related Interest Period, the principal amount of Money Market Loans in respect of which such similar offers are accepted shall be allocated by Agent among such Banks as nearly as possible (in such multiples, not greater than $100,000, as Agent may deem appropriate) in proportion to the principal amounts of such offers. Determinations by Agent of such proportionate amounts of Money Market Loans shall be conclusive in the absence of demonstrable error. 2. Effect on Commitment. Any Money Market Loan made by a Bank under this Section 2.03 shall be considered usage of the Facility for the purpose of fees and availability. Outstanding Money Market Loans shall not affect the requirement of any Bank to fund its Pro Rata Share under a Syndicated Loan. 3. Variances. The time periods set forth in this Section 2.03 related to the conduct of any auction may be varied as the Borrower, Agent and the participating Banks may agree. D. SECTION THIS SECTION IS RESERVED. E. SECTION Interest Period for Borrowings. 1. Interest Payment Dates. Subject to the following provisions of this Section 2.05, all interest payments shall be due and payable on the last day of any applicable Interest Period with respect to all Loans. 2. Base Rate Borrowings. The "Interest Period" with respect to each Base Rate Borrowing means the period commencing on the day the Base Rate Loans are made and ending up to 180 days thereafter, as the Borrower may elect in the Notice of Syndicated Borrowing; provided that: a) any Interest Period which would otherwise end on a day which is not a Business Day shall be extended to the next succeeding Business Day; and b) all interest payments with respect to Base Rate Loans shall be paid on each Quarter End falling after the commencement of the Interest Period. 3. LIBOR Rate, Money Market LIBOR and Foreign Currency Borrowings. The "Interest Period" with respect to each LIBOR Rate Borrowing, Money Market LIBOR and Foreign Currency Borrowing means the period commencing on the day the LIBOR Rate Loans, Money Market

LIBOR Loans or Foreign Currency Loans, as the case may be, constituting such Borrowing are made and ending one, two, three or six months thereafter (or other period up to six months agreed upon by the Borrower and the Banks), as the Borrower may elect in the applicable Notice of Borrowing; provided that: a) any Interest Period which would otherwise end on a day which is not a Business Day shall be extended to the next succeeding Business Day unless such Business Day falls in another calendar month, in which case such Interest Period shall end on the next preceding Business Day; and b) any Interest Period which begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of a calendar month. 4. Money Market Absolute Rate Borrowing. The "Interest Period" with respect to each Money Market Absolute Rate Borrowing means the period commencing on the day the Money Market Absolute Rate Loans constituting such Borrowing are made and ending on any day up to 180 days thereafter, as the Borrower may elect in the applicable Notice of Borrowing; provided that any Interest Period which would otherwise end on a day which is not a Business Day shall be extended to the next succeeding Business Day. 5. Outside Limit. Notwithstanding any of the foregoing provisions of this Section 2.05, no "Interest Period" applicable to any Loan shall extend beyond the Termination Date, and any Interest Period which otherwise would so extend shall end on the Termination Date. F. SECTION Maturity of Loans and Payment of Interest. Each Loan included in any Borrowing shall mature, and the principal amount thereof shall be due and payable, on the last day of the then current Interest Period applicable to such Borrowing. G. SECTION Interest Rate Options. The principal amount of each Loan while outstanding shall bear interest for each day from the day such Loan is made until due, payable on the last day of each Interest Period applicable thereto (subject to the definitional provisions of Section 2.05), at a rate per annum (based on a 360-day year and actual days elapsed, in the case of non-Base Rate Loans, and a 365-day year (366- day year in leap years), in the case of Base Rate Loans, in all cases counting the first day but not the last day of any Interest Period) equal to one of the following interest rates selected or accepted by the Borrower, as applicable: Base Rate, LIBOR Rate, Money Market LIBOR Rate, Foreign Currency Rate and Money Market Absolute Rate, in each case as described below in this Section 2.07. 1. Base Rate Loans. Each Base Rate Loan shall bear interest at the Base Rate. The "Base Rate" applicable to any Base Rate Loan for any day during the Interest Period applicable thereto means a rate per annum equal to the higher of (i) the Reference Rate in effect for such day or (ii) the Federal Funds Rate for such day plus 0.50%. Any change in the Base Rate due to a change in the Reference Rate shall be effective on the date specified in the public announcement of such change, and any change in the Base Rate due to a change in the Federal Funds Rate shall be effective on the effective date of such change in the Federal Funds Rate. 1. "Federal Funds Rate" means, on any day, the rate per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day; provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such rate is published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate charged to Agent (in its individual capacity) on such day on such transactions as determined by Agent. 2. LIBOR Rate. Each LIBOR Rate Loan shall bear interest at the LIBOR Rate. The "LIBOR Rate" applicable to any LIBOR Rate Loan for any day during any Interest Period applicable thereto means a rate per annum equal to the sum of the Applicable Margin for such day plus the applicable Adjusted LIBOR Rate. The "Adjusted LIBOR Rate" applicable to any Interest Period means a rate per annum equal to the quotient obtained (rounded upwards, if necessary, to the next higher 1/100 of 1%) by dividing (i) the applicable London Interbank Offered Rate by (ii) 1.00 minus the Euro-Dollar Reserve Percentage. The "London Interbank Offered Rate" applicable to any Interest Period with respect to a LIBOR Rate Loan or a Money Market LIBOR Loan, as the case may be, means the rate per annum, (rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing on Telerate Page 3750 (or any successor page) as the London interbank offered rate for deposits in Dollars at approximately 11:00 a.m. (London time) two Business Days prior to the first day of such Interest Period for a term comparable to such Interest Period. If for any reason such rate is not available, the term "London Interbank Offered Rate" shall mean, for any LIBOR Rate Loan or an Money Market LIBOR Rate Loan, as the case may be, the rate per annum, (rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing on Reuters Screen LIBO Page as the London interbank offered rate for deposits in Dollars at approximately 11:00 a.m. (London time) two Business Days prior to the first day of such Interest Period for a term comparable to such Interest Period; provided, however, if more than one rate is specified on Reuters Screen LIBO Page, the applicable rate shall be the arithmetic mean of all such rates (at approximately 11:00 a.m. (London time) two Business Days prior to the first day of such Interest Period for a term comparable to such Interest Period). 1. "Euro-Dollar Reserve Percentage" means for any day the maximum rate (expressed as a decimal) at which reserves (including, without limitation, any marginal, special, supplemental, or emergency reserves) are required to be maintained under regulations issued from time to time by the Board of Governors of the Federal Reserve System (or any successor) by member banks of the Federal Reserve System against in the case of LIBOR Loans, "Eurocurrency liabilities" (as such term is used in Regulation D promulgated by the Board of Governors from time to time). Without limiting the effect of the foregoing, the Euro- Dollar Reserve Percentage shall reflect any other reserves required to be maintained by such member banks with respect to (i) any category of liabilities which includes deposits by reference to which the Adjusted LIBOR Rate is to be determined or (ii) any category or extensions of credit or other assets which include LIBOR Loans. The Adjusted LIBOR Rate shall be adjusted automatically on and as of the effective date of any change in the Euro-Dollar Reserve Percentage. As of the date hereof, the Euro-Dollar Reserve Percentage is equal to zero. 2. Foreign Currency Rate. Each Foreign Currency Loan shall bear interest at the Foreign Currency Rate. The "Foreign Currency Rate" applicable to any Foreign Currency Loan for any day during any Interest Period applicable thereto means a rate per annum equal to the sum of the Applicable Margin for such day plus the applicable Adjusted Foreign Currency Rate. The "Adjusted Foreign Currency Rate" applicable to any Interest Period means a rate per annum equal to the quotient obtained (rounded upwards, if necessary, to the next higher 1/100 of 1%) by dividing (i) the applicable London Interbank Foreign Currency Offered Rate by (ii) 1.00 minus the Euro-Dollar Reserve Percentage. 3. The "London Interbank Foreign Currency Offered Rate" applicable to any Interest Period with respect to a Foreign Currency Loan means the rate per annum, (rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing on the appropriate Telerate Page as the London interbank offered rate for deposits in such Foreign Currency at approximately 11:00 a.m. (London time) two Business Days prior to the first

day of such Interest Period for a term comparable to such Interest Period. If for any reason such rate is not available, the term "London Interbank Foreign Currency Offered Rate" shall mean, for any Foreign Currency Loan the rate per annum, (rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing on the appropriate page of the Reuters Screen as the London interbank offered rate for deposits in such Foreign Currency at approximately 11:00 a.m. (London time) two Business Days prior to the first day of such Interest Period for a term comparable to such Interest Period; provided, however, if more than one rate is specified on the appropriate page of the Reuters Screen, the applicable rate shall be the arithmetic mean of all such rates (at approximately 11:00 a.m. (London time) two Business Days prior to the first day of such Interest Period for a term comparable to such Interest Period). 4. Money Market LIBOR Rate. Each Money Market LIBOR Rate Loan shall bear interest on the outstanding principal amount thereof, for the Interest Period applicable thereto, at a rate per annum equal to the sum of the applicable London Interbank Offered Rate for such Interest Period plus (or minus) the Money Market Margin quoted by the Bank making such Loan as a part of the applicable Bid Borrowing in accordance with Section 2.03(d)(ii)(D) (the "Money Market LIBOR Rate" for such Loan). 5. Money Market Absolute Rate. Each Money Market Absolute Rate Loan shall bear interest on the outstanding principal amount thereof, for the Interest Period applicable thereto, at a rate per annum equal to the Absolute Rate quoted by the Bank making such Loan as a part of the applicable Bid Borrowing in accordance with Section 2.03(d)(ii)(E) (the "Money Market Absolute Rate" for such Loan). 6. Determination of Interest Rates. Agent shall determine each interest rate with respect to which it has responsibility to make such determination pursuant to and in accordance with this Agreement. Agent shall give prompt notice to the Borrower and the participating Banks by telex, facsimile or cable of each rate of interest so determined, and its determination thereof shall be conclusive in the absence of demonstrable error. H. SECTION Certain Loans or Interest Rates Unavailable. 1. LIBOR and Foreign Currency Loans Unavailable. If, on any date on which an interest rate based on LIBOR or a Foreign Currency Rate would otherwise be set, (i) Agent shall determine in accordance with the terms of this Agreement that adequate and reasonable means do not exist for ascertaining the interest rate based on LIBOR or on Foreign Currency Loans, with respect to any Interest Period, including, without limitation, the inability or failure of Agent to obtain sufficient information with respect to rates from the applicable source as contemplated by this Agreement, (ii) Agent shall determine that the Adjusted LIBOR Rate or the Adjusted Foreign Currency Rate, as determined by Agent, will not adequately and fairly reflect the cost to the Banks of funding a proposed Loan for such Interest Period, or (iii) Agent shall determine that the requested Foreign Currency deposits (as to the portion of any Borrowing proposed to be made in a Foreign Currency) in the required amount for the required Interest Period are not being offered to the Banks by prime banks in the London interbank Euro-currency market, then Agent shall forthwith give notice thereof to the Borrower and the Banks, whereupon until the Agent shall determine that the circumstances giving rise to such suspension no longer exist, the obligations of the Banks to make LIBOR Rate Loans or Foreign Currency Loans (as applicable), shall be suspended. Unless the Borrower notifies Agent ( who shall promptly notify the Banks) at least one Business Day before the date of any proposed Borrowing affected by the circumstances described in this subsection (a) for which a Notice of Borrowing has previously been given that it elects not to borrow on such date, such Borrowing shall instead be made as a Base Rate Borrowing, and the Banks shall make such Base Rate Loans; provided, however, with respect to such a proposed Borrowing to be made as a Money Market LIBOR Loan, the interest rate shall be an absolute rate agreed by the Borrower and the lending Banks. 2. Federal Funds Rate Unavailable. If, on any date on which a Base Rate would otherwise be set, Agent shall determine in accordance with the terms of this Agreement that it is unable to ascertain the Federal Funds Rate for any reason, including, without limitation, the inability or failure of Agent to obtain sufficient bids or publications contemplated by this Agreement, Agent shall forthwith give notice thereof to the Borrower and the Banks, whereupon until Agent shall notify the Borrower and the Banks that the circumstances giving rise to such inability no longer exist, the Base Rate shall be the Reference Rate. I. SECTION Default Rate. Any sum of principal, interest, fees, or other amounts payable by Borrower under any Loan or otherwise hereunder if not paid when due (whether before or after acceleration) shall bear interest (payable on demand) from its due date until payment in full (computed daily on the basis of a 360 day year and actual days elapsed) of a rate per annum equal to 2% above the then applicable interest rate or rates (if more than one type of Loan is outstanding), reset daily. J. SECTION Evidence of Loans/Borrowings. 1. Loan Account; Note. Agent shall maintain in accordance with its usual practice an account or accounts evidencing the indebtedness of the Borrower to each Bank resulting from each Loan owing to such Banks from time to time, including the amounts of principal and interest payable and paid to such Banks from time to time hereunder. The Borrower shall execute and deliver to each Bank a Revolving Note substantially in the form of Exhibit A attached hereto. 2. Register. Agent shall maintain at its address referred to in Section 11.01 a register for the recordation of the names and addresses of the Banks (including any assignees which have become Banks pursuant to an Assignment and Acceptance pursuant to Section 11.08) and the Commitment of, and principal amount of the Loans owing to, each Bank from time to time (the "Register"). The Register shall evidence the indebtedness of the Borrower under this Agreement by individual Bank and in the aggregate and include a record of the dates and amounts of each Borrowing, the Type of Loans and the Interest Period applicable thereto, and the amounts of principal or interest payable, paid or prepaid in connection therewith. The entries in the Register shall be conclusive and binding for all purposes, absent demonstrable error, and the Borrower and the Banks may treat each Person whose name is recorded in the Register as a Bank hereunder for all purposes of this Agreement. The Register shall be available for inspection by the Borrower and any Bank at any reasonable time and from time to time upon reasonable prior notice. K. SECTION Failure to Give Notice, Automatic Conversion. If the Borrower is otherwise entitled under this Agreement to repay any Syndicated Loans maturing at the end of an Interest Period applicable thereto with the proceeds of a new Syndicated Borrowing, and the Borrower fails to repay such Syndicated Loans using its own moneys and fails to give a Notice of Borrowing in connection with such new Syndicated Borrowing, a new Syndicated Borrowing shall be deemed to be made on the date such Syndicated Loans mature in an amount equal to the principal amount of the Syndicated Loans so maturing. If the maturing Syndicated Loans are not Foreign Currency Loans, the Syndicated Loans comprising such new Syndicated Borrowing shall be Base Rate Loans and the Interest Period for such Borrowing shall be 30 days. If the maturing Syndicated Loans are Foreign Currency Loans, the Syndicated Loans comprising such new Syndicated Borrowing shall also be Foreign Currency Loans of the same Foreign Currency and the Interest Period for such Borrowing shall be 30 days. L. SECTION Prepayments. Except as otherwise expressly provided in Section 9.02 and Section 9.03, the Borrower may not prepay any Bid Loan. Subject to Section 2.13, the Borrower may prepay any Syndicated Loan in whole at any time, or from time to time in part in amounts

aggregating at least $1,000,000, by paying the principal amount to be prepaid together accrued interest thereon to the date of prepayment. Each such optional prepayment shall be applied to prepay ratably the Syndicated Loans of the several Banks included in such Borrowing. M. SECTION Funding Losses. If for any reason the Borrower makes any payment of principal with respect to any non-Base Rate Loan under this Agreement on any day prior to the last day of the Interest Period applicable thereto, or if for any reason the Borrower fails to borrow any such Loan after notice has been given to any Bank in accordance with this Agreement, the Borrower shall reimburse each Bank within 15 days of demand for any resulting loss or expense actually incurred by it including (without limitation) any loss actually incurred in obtaining, liquidating or employing deposits from third parties, but excluding loss of margin for the period after any such payment or failure to borrow, provided that such Bank shall have delivered to the Borrower a certificate as to the amount of such loss or expense in reasonable detail, which certificate shall be conclusive in the absence of demonstrable error. N. SECTION General Rules as to Payments. 1. The Borrower shall make each payment of principal, interest, fees and otherwise to be made under this Agreement not later than 12:30 p.m. (Dallas, Texas time) on the date when due to Agent at its office address appearing on the signature page hereof for the account of the Banks (or their applicable Lending Office). All payments of all Loans shall be made in the appropriate Available Currency in immediately available funds. Each payment shall be made only on a Business Day. If the day on which a payment shall be due is not a Business Day, the date for payment thereof shall be extended to the next succeeding Business Day (unless, in the case of LIBOR Rate or Money Market LIBOR, otherwise expressly provided herein). If the date for any payment of principal is extended by operation of law or otherwise, interest thereon shall be payable for such extended time. 2. Except to the extent otherwise provided in this Agreement: (i) each Loan shall be made by the Banks under Section 2.01, each payment of Facility Fees shall be made for the account of the Banks, and each termination or reduction of the Commitments shall be applied to the Commitments of the Banks, based upon their Pro Rata Shares; and (ii) each payment and prepayment by Borrower of principal of or interest on Loans of a particular Type shall be made to Agent for the account of the Banks holding Loans of such Type pro rata in accordance with the respective unpaid principal amounts of such Loans held by such Banks. O. SECTION Funding of Loans. 1. Disbursements. Not later than 2:00 p.m.(Dallas, Texas time) on the date of each Borrowing, each Bank participating therein shall (except as provided in subsection (b) of this Section) make available its share of such Borrowing, in immediately available funds in the appropriate Available Currency (as applicable), to Agent who shall make available such funds to the Borrower not later than 2:00 p.m. (Dallas, Texas time) on such date at the Borrower's account designated on the signature page hereto, or such other account as may be designated by Borrower by notice to Agent. 2. Net Payments. If any Bank makes a new Loan hereunder on a day on which the Borrower is to repay all or any part of an outstanding Loan from such Bank, such Bank shall automatically apply the proceeds of its new Loan against principal amount due to make such repayment and only an amount equal to the difference (if any) between the amount being borrowed and the amount being repaid shall be made available by such Bank to the Borrower as provided in subsection (a), or remitted by the Borrower to the Bank as provided in Section 2.14, as the case may be. P. SECTION Fees. 1. Facility Fee. Borrower shall pay to Agent for the account of each Bank, based upon its Pro Rata Share, a facility fee ("Facility Fee") equal to the rate per annum (based on actual days elapsed and a 360 day year) set forth in the right hand column below on the daily average, of the aggregate amount of the Commitments, regardless of utilization thereof, for each day (from and including the Effective Date to but excluding the later of the Termination Date or the date that the Obligations are paid in full) based upon the Rating (which shall be (i) the higher of the two Ratings of Standard & Poor's Inc. and Moody's Investor Corporation or (ii) the Rating immediately below the higher of such two Ratings if the two Ratings are split by more than one Rating) in effect on such day for Borrower's senior unsecured nonconvertible long-term indebtedness as set forth in the left hand column below:

1. Payment of Fees. Accrued Facility Fees under this Section 2.16 shall be payable quarterly in arrears on each March 31, June 30, September 30 and December 31 of each year during the term of this Agreement, and on the later of the Termination Date or the date on which the Obligations are paid in full. Payment of all such Facility Fees shall be made by wire transfer or automated clearing house (ACH) transfer not later than the fifth Business Day following the aforesaid dates. Q. SECTION Optional Reduction of Commitments. The Borrower from time to time, upon at least three Business Days' notice to the Banks, may irrevocably reduce ratably among the Banks the unused portion (without regard to outstanding Bid Loans) of the aggregate Commitments; provided that (i) such reduction shall be by an aggregate amount of at least $5,000,000, and integral multiples in excess thereof of $1,000,000 (except a reduction may be in the amount of the aggregate unused Commitments), and (ii) the aggregate Commitments shall not be reduced to an amount less than the aggregate principal amount of all Loans then outstanding. In the event the Commitments are reduced to zero, this Agreement shall terminate and any Facility Fees then accrued shall become immediately payable. R. SECTION Extension of Termination Date. 1. Within 60 days prior to the first anniversary of the Closing Date, the Borrower may notify Agent that it desires that the Termination Date be extended for one year to the sixth anniversary of the Closing Date. The Agent shall provide written notice of such request to all the Banks within two Business Days after its receipt thereof, and each Bank shall notify Agent in writing within ten Business Days after its receipt of the written notice from Agent of its decision regarding such request. The failure of any Bank to respond to such request within the ten Business Day period shall be deemed a refusal to such request by such Bank. If all of the Banks consent to such request in writing within such ten Business Day period (such consenting Banks are referred to herein as the "Consenting Banks"), the Termination Date shall be extended to the sixth anniversary of the Closing Date, and Agent shall notify the Borrower in writing of such extension within two Business Days of its receipt

Rating Rate Per Annu m A/A2 or better 7.5 basis po ints A-/A3 8.0 basis po ints BBB+/Baa 1 8.5 basis po ints BBB/Baa2 11.0 basis po ints BBB-/Baa3 or lower 15.0 basis po ints

of the last written consent from the Banks. If within such ten Business Day period, one or more Banks informs the Agent in writing that it does not consent to such extension request or fails to consent in writing (such non-consenting Banks are referred to herein as the "Non- Consenting Banks"), Agent shall promptly notify the Borrower of each such Non-Consenting Bank, and the Borrower, at its option, shall have a period of 30 days after receipt of such notice (i) to replace each such Non-Consenting Bank pursuant to the provisions of Section 11.07 with an Eligible Assignee which does consent to such extension, or (ii) to continue this Agreement with the Consenting Banks and to reduce the amount of the Facility by the amount of the Loans and Commitments of all Non-Consenting Banks. If the Borrower elects to replace the Non-Consenting Banks and is able to replace all such Non-Consenting Banks with Eligible Assignees pursuant to Section 11.07, each such Eligible Assignee shall notify the Agent in writing of its agreement to replace a Non-Consenting Bank and the amount of Loans and Commitments it is willing to acquire. The transfer and assignment of each Non-Consenting Bank's Loans and Commitments and the transfer of its obligations under this Agreement to an Eligible Assignee shall be made pursuant to an Assignment and Acceptance promptly following the Agent's receipt of the last Eligible Assignee's written agreement to replace a Non-Consenting Bank. Upon the execution and delivery of such Assignment and Acceptances, the Loans and Commitments shall continue without interruption hereunder. If the Borrower elects to continue the Facility with only the Consenting Banks, then upon the original Termination Date, and assuming that no Default or Event of Default then exists, (i) this Agreement shall be extended for one additional year between the Borrower and the Consenting Banks whose Loans and Commitments will continue unchanged, and (ii) the Loans payable to the Non-Consenting Banks shall be paid in full along with all other amounts, if any, which may be owed to them under the Loan Documents, and their Commitments shall terminate. 2. If the original Termination Date is extended for one year pursuant to the terms of this Section 2.18, then within 60 days prior to the second anniversary of the Closing Date, the Borrower may again request that the extended Termination Date be extended for an additional one year to the seventh anniversary of the Closing Date. Agent shall follow the same procedures of notification and polling of the Banks to determine if the request will be accepted and shall notify Borrower of the results. In no event shall the Termination Date as extended be extended beyond the seventh anniversary of the Closing Date. S. SECTION Letters of Credit. 1. The Facility may be utilized by Borrower to support the issuance of Letters of Credit for the account of Borrower, subject to the unused Commitments (which Commitments shall be deemed used to the extent of all Letter of Credit Liabilities), up to the maximum aggregate unfunded face amount at any time outstanding of $25,000,000. The maximum term of any such Letter of Credit shall be one year, and no Letter of Credit shall be issued with an expiration date which is later than 90 days after expiration of the Termination Date. Each such Letter of Credit shall be supported by a duly executed application and reimbursement agreement in form satisfactory to the Issuing Bank and shall be subject to payment to Agent for the account of the Banks (based upon their respective Pro Rata Shares) of an annual fee (pro-rated for periods of less than one year), payable quarterly in arrears, in an amount equal to the Applicable Margin for LIBOR Rate Loans, as such rate may change from time to time during the term of such Letter of Credit, times the unfunded face amount thereof. 2. Upon receipt from the beneficiary of any Letter of Credit of any demand for payment or other drawing under such Letter of Credit, the Issuing Bank shall promptly notify Borrower and each Bank as to the amount to be paid as a result of such demand or drawing and the respective payment date. If at any time the Issuing Bank shall make a payment to a beneficiary of a Letter of Credit pursuant to a drawing under such Letter of Credit, each Bank will pay to the Issuing Bank, immediately upon the Issuing Bank's demand at any time commencing after such payment until reimbursement therefor in full by Borrower, an amount equal to such Bank's Pro Rata Share of payment, together with interest on such amount for each day from the date of such payment to the date of payment by such Bank of such amount at a rate of interest per annum equal to the Federal Funds Rate. 3. Promptly after each drawing under any Letter of Credit, Issuing Bank shall notify the Borrower of the time and amount of such drawing. Unless the Borrower shall reimburse Issuing Bank within one Business Day after receipt of such notice for any amounts paid by Issuing Bank upon any such drawing, without presentment, demand, protest or other formalities of any kind, such drawing shall, if the Borrower then satisfies the conditions of Section 3.02, automatically and without further action by the Borrower be treated as a Base Rate Loan (until such Loan is Converted to a Loan of another Type as provided herein), in which case such drawn amounts shall be subject to all terms and provisions hereof relating to Loans. If the Borrower does not then satisfy the conditions of Section 3.02, such outstanding Reimbursement Obligation shall bear interest at the Default Rate, and such Reimbursement Obligation and the interest thereon shall be payable on demand. If the Borrower elects to reimburse Issuing Bank as provided above, Issuing Bank will pay to each Bank such Bank's Pro Rata Share of all amounts received from or on behalf of the Borrower for application in payment, in whole or in part, of the Reimbursement Obligation in respect of any Letter of Credit, but only to the extent such Bank has made payment to Issuing Bank in respect of such Letter of Credit pursuant to subsection (b) above. III. ARTICLE CONDITIONS A. SECTION Conditions to Effectiveness. This Agreement will become effective on the date (the "Effective Date") when all of the following have occurred: 1. Agreement Counterparts. Counterparts of this Agreement shall have been executed and delivered to the Banks by the Borrower and counterparts of this Agreement shall have been executed and delivered by each Bank to the Borrower and the other Banks. 2. Notes. A Revolving Note substantially in the form of Exhibit A with appropriate insertions shall have been executed by the Borrower and delivered to each of the Banks. 3. Guaranties. Each Guarantor shall have executed and delivered a guaranty agreement substantially in the form of Exhibit B to the Agent for the benefit of each of the Banks. 4. Legal Opinion. An opinion of counsel for the Borrower, reasonably acceptable to the Majority Banks, dated the Effective Date and substantially in the form of Exhibit H hereto and covering such additional matters relating to the transactions contemplated hereby as the Majority Banks may reasonably request shall have been delivered to each Bank. In rendering its opinion, such counsel may rely, to the extent such counsel deems reliance proper, on the opinions of other counsel as to certain matters, all as reasonably acceptable to the Majority Banks. 5. Compliance with Representations and No Default; Officer Certificates. The representations of the Borrower contained in Article 4 shall be true and correct and no Default or Event of Default shall have occurred and be continuing. A certificate dated the Effective Date, signed by an Authorized Officer, to the effect set forth in this clause (e) of this Section 3.01 and to the further effect that no Default or Event of Default shall have occurred and be continuing shall have been delivered by the Borrower to each Bank. 6. Other Documents. All documents which the Majority Banks may reasonably request relating to the existence of the Borrower, the corporate authority for and the validity of this Agreement, incumbency of officers and such persons who are authorized to execute Notices of Borrowing

and like instruments hereunder and any other relevant matters, all in form and substance reasonably satisfactory to the Majority Banks shall have been delivered to the Banks. 7. No Material Adverse Change. Except as disclosed on Schedule 3 hereto, since June 29, 1997, there has been no material adverse change in the business, operations or financial position of the Borrower and its Consolidated Subsidiaries, considered as a whole. B. SECTION Conditions to Borrowings. The obligation of each Bank to make any Loan (Syndicated and Bid) on the occasion of each Borrowing is subject to the satisfaction of the following conditions: 1. Notice of Borrowing. The Agent shall have received (or be deemed to have received) the applicable Notice of Borrowing as required by Article II. 2. Loan Limit. Immediately after such Borrowing, the aggregate outstanding principal amount of the Loans and the Letter of Credit Liabilities shall not exceed the aggregate amount of the Commitments. 3. No Default. Immediately after such Borrowing, no Default or Event of Default shall have occurred and be continuing. 4. Representations and Warranties . On the date of such Borrowing, (i) in the case of any Borrowing other than a Refunding Borrowing, the representations and warranties of the Borrower contained in Article IV of the Agreement shall be true and correct in all material respects on and as of the date of such Borrowing, and (ii) in the case of any Refunding Borrowing, the representations and warranties contained in Article IV of this Agreement (excluding Section 4.05, as to which no representation and warranty is then required to be made) shall be true and correct in all material respects on and as of the date of such Refunding Borrowing. Each Borrowing (or Refunding Borrowing, as applicable) hereunder shall be deemed to be a representation and warranty by the Borrower on the date of such Borrowing as to the facts specified in clauses (b) , (c) and (d) of this Section as if Borrower had delivered a certificate to the Banks affirming such facts. IV. ARTICLE REPRESENTATIONS AND WARRANTIES The Borrower represents and warrants severally to the Banks that: A. SECTION Corporate Existence and Power. The Borrower is a corporation duly incorporated, validly existing and in good standing under the laws of Colorado, and has all corporate powers and all material governmental licenses, authorizations, consents and approvals required to carry on its business as now conducted. B. SECTION Corporate and Governmental Authorization; No Contravention. The execution, delivery and performance by the Borrower of this Agreement are within the Borrower's corporate powers, have been duly authorized by all necessary corporate action, require no action by or in respect of, or filing with, any Governmental Authority or any other third party under any existing material contractual arrangements, and do not contravene, or constitute a default under, any provision of applicable Law or of the articles of incorporation or by-laws of the Borrower or of any material term of any material agreement or other instrument binding upon the Borrower or result in the creation or imposition of any Lien on any asset of the Borrower or any of its Subsidiaries. C. SECTION Binding Effect. This Agreement has been duly executed and delivered by the Borrower and constitutes the valid and binding agreement and obligations of the Borrower, enforceable in accordance with their terms subject to applicable bankruptcy, reorganization, insolvency, moratorium and similar laws affecting creditors rights generally, and to general principles of equity (whether considered in a court of law or in equity). D. SECTION Financial Information. The consolidated financial statements of Borrower for the year ended December 29, 1996, and the quarters ended March 30, 1997 and June 29, 1997, fairly present, in conformity with generally accepted accounting principles, the consolidated financial position and results of operations of the Borrower and its Consolidated Subsidiaries as of such dates. E. SECTION Litigation. Except as disclosed on Schedule 4 hereto, there is no action, suit or proceeding pending, or to the knowledge of the Borrower, overtly threatened against or affecting the Borrower or any of its Subsidiaries before any court or arbitrator or any governmental body, agency or official that purports to affect the Borrower or any of its Restricted Subsidiaries or any transaction contemplated by this Agreement, or in which there is a reasonable probability of an adverse decision that would materially adversely affect the business, operations or financial position of the Borrower and its Restricted Subsidiaries, considered as a whole, or which in any manner draws into question the validity of this Agreement or the Borrower's obligations hereunder. F. SECTION Compliance with ERISA. Borrower and each ERISA Affiliate have fulfilled their obligations under the minimum funding standards of ERISA and the Code with respect to each Plan and are in compliance in all material respects with the presently applicable provisions of ERISA and the Code, and have not incurred any material liability to the PBGC or a Plan under Title IV of ERISA other than a liability to the PBGC for premiums under Section 4007 of ERISA. G. SECTION Compliance with Laws. Neither the Borrower nor any of its Restricted Subsidiaries is in violation of any applicable Law (including, but not limited to, Environmental Laws, ERISA and the Code) except where failure to so comply would not have a reasonable probability of having a material adverse effect on the business, operations or financial position of the Borrower and its Restricted Subsidiaries, considered as a whole. H. SECTION Taxes. The Borrower and its Restricted Subsidiaries have filed all United States federal income tax returns and all other material tax returns which are required to be filed by them and have paid all taxes due pursuant to such returns or pursuant to any assessment received by the Borrower or any Subsidiary, other than taxes contested in good faith by the Borrower or such Subsidiary or for which adequate reserves have been set aside in accordance with generally accepted accounting principles. The charges, accruals and reserves on the books of the Borrower and its Restricted Subsidiaries in respect of taxes or other governmental charges are, in the opinion of the Borrower, adequate. I. SECTION Subsidiaries. Each of the Borrower's Restricted Subsidiaries is a corporation duly incorporated, validly existing and in good standing under the laws of its jurisdiction of incorporation, and has all corporate powers and all material governmental licenses, authorizations, consents and approvals required to carry on its business as now conducted, the absence of which would have a material adverse effect on the business, operations or financial position of the Borrower and its Restricted Subsidiaries, considered as a whole. J. SECTION Not an Investment Company. The Borrower is not an "investment company" within the meaning of the Investment Company Act of 1940, as amended. K. SECTION No Margin Stock. No part of the proceeds of any Loan will be used for the purpose of purchasing or carrying any "margin stock" within the meaning of Regulation U or X promulgated by the Board of Governors of the Federal Reserve System. L. SECTION Full Disclosure. There is no fact which the Borrower has not disclosed in writing to the Banks on or prior to the Effective Date which has, or as far as the Borrower can now reasonably foresee will have, a material adverse effect on the ability of the Borrower to perform its obligations under this Agreement or to pay the principal or the interest on any Loan or any fees or other amounts due hereunder. M. SECTION Excluded Principal Plants. Schedule 2, as it may be amended from time to time after the Effective Date by the Borrower by the execution and delivery of such amended Schedule or a certificate pursuant to Section 5.01(g) to the Banks, contains a complete and accurate

list of the plants owned by the Borrower or any Subsidiary excluded from the definition of "Principal Plant" pursuant to the terms of such definition. V. ARTICLE GENERAL COVENANTS The Borrower agrees that, so long as any Bank has any Commitment hereunder or any amount payable under this Agreement remains unpaid, unless and to the extent the Majority Banks waive compliance in writing: A. SECTION Information. 1. SEC Reports. The Borrower will deliver to Agent within 15-days of the filing thereof with the SEC or delivery thereof to its shareholders, a copy of the annual and quarterly reports and other filings (excluding exhibits) made by the Borrower with the SEC under the Exchange Act or delivered to its shareholders, or if Borrower in the future becomes exempt from the reporting requirements of such Act, copies of the financial statements as provided in clause (b) of this Section 5.01. 2. Financial Statements. If and when Borrower is no longer subject to the reporting requirements under the Exchange Act, Borrower will deliver to Agent (i) within 90 days after the end of each fiscal year of the Borrower, a copy of the consolidated financial statements of the Borrower and its Consolidated Subsidiaries as of the end of such fiscal year, together with an opinion thereon by Price Waterhouse or other independent public accountants of nationally recognized standing; and (ii) within 45 days after the end of each of the first three quarters of each fiscal year of the Borrower, the unaudited consolidated financial statements of the Borrower and its Consolidated Subsidiaries as of the end of such quarter and that portion of the fiscal year ending with such quarter, all certified (subject to normal year-end adjustments) as to fairness of presentation, generally accepted accounting principles and consistency by an Authorized Officer. 3. Compliance Certificates. Quarterly, simultaneously with the delivery of each set of quarterly financial statements referred to in clause (a) or (b) above, Borrower will deliver to Agent a certificate of an Authorized Officer stating, to the best of such Authorized Officer's knowledge, (i) whether the Borrower was in compliance with the financial covenants contained in Article VII as of the date of such financial statements, and setting forth in reasonable detail the calculations required to establish the Borrower's compliance with such covenants; and (ii) whether any Default or Event of Default has occurred and is continuing on the date of such certificate and, if any Default or Event of Default then exists, setting forth the details thereof and the action which the Borrower is taking or proposes to take with respect thereto. 4. Other Reports. Promptly upon their becoming available to the Borrower, the Borrower will deliver to Agent (except to the extent already covered by clause (a) of this Section 5.01) a copy of (i) all regular or special reports or effective registration statements (excluding registration statements on Form S-8 or any substitute form adopted by the SEC) which the Borrower or its Consolidated Subsidiaries shall file with the SEC and (ii) all reports, proxy statements, financial statements and other information distributed by the Borrower to its shareholders generally. 5. Notice of Default. No later than three Business Days after becoming aware thereof, Borrower will deliver to Agent a certificate of an Authorized Officer as to the occurrence of any Default or Event of Default setting forth the details thereof and the action which the Borrower is taking or proposes to take with respect thereto. 6. Principal Plant Report. Promptly after any determination by the Board of Directors of Borrower of any exclusion of a plant from the definition of Principal Plant, Borrower will deliver a certificate of an Authorized Officer to Agent setting forth such determination, which certificate shall constitute an amendment to Schedule 2 hereof. 7. Other Information. From time to time Borrower shall provide Agent such additional information regarding the financial position of the Borrower and its Consolidated Subsidiaries or matters related to verifying Borrower's compliance with this Agreement as any Bank may reasonably request. Promptly after its receipt of any of the above reports or information, Agent will distribute copies thereof to each Bank. B. SECTION Payment of Obligations. The Borrower will pay and discharge, and will cause each Restricted Subsidiary to pay and discharge, as and when due, all their material obligations and liabilities, including, without limitation, tax liabilities, except where the same may be contested in good faith by appropriate proceedings or for which adequate reserves have been set aside in accordance with generally accepted accounting principles or as to which a bona fide dispute may exist, and will maintain, and will cause each Subsidiary to maintain, in accordance with generally accepted accounting principles, adequate reserves for the accrual of any of the same. C. SECTION Maintenance of Property. The Borrower shall, and shall cause each of its Restricted Subsidiaries to, maintain its properties and assets in normal working order and condition and make all necessary repairs, renewals, replacements, additions, betterments and improvements thereto, ordinary wear and tear and obsolescence excepted, all as in the judgment of the Borrower may be necessary so that the business carried on in connection therewith may be properly and advantageously conducted at all times; provided, however, that nothing in this Section 5.03 shall prevent the Borrower or one of its Restricted Subsidiaries from discontinuing the operation and maintenance of any of its properties if such discontinuance is, in the judgment of the Borrower or such Subsidiary, desirable in the conduct of its business and not disadvantageous in any material respect to the Banks. D. SECTION Insurance. The Borrower shall, and shall cause each of its Restricted Subsidiaries to, maintain with financially sound and reputable insurers such insurance as may be required by law and such other insurance (including self-insurance) to such extent and against such hazards and liabilities as Borrower determines to be reasonably prudent. E. SECTION Conduct of Business and Maintenance of Existence. Except as otherwise permitted in Section 6.03, to the extent necessary or desirable in the normal conduct of the business of the Borrower and each Subsidiary, the Borrower will preserve, renew and keep in full force and effect and will cause each Subsidiary to preserve, renew and keep in full force and effect, their corporate existences, rights, privileges and franchises. F. SECTION Compliance with Laws. The Borrower will comply, and will cause each Subsidiary to comply, with all applicable Laws (including, without limitation, ERISA and Environmental Laws) except where the failure to comply would not have a reasonable probability of having a material adverse effect on the business, operations or financial position of the Borrower and its Consolidated Subsidiaries, considered as a whole. G. SECTION Inspection of Property, Books and Records. The Borrower will keep, and will cause each Subsidiary to keep, proper books of record and account in which full, true and correct entries shall be made of all dealings and transactions in relation to its business and activities; and will permit, and will cause each Subsidiary to permit, representatives of any Bank at such Bank's expense to visit and inspect any of their respective properties, to examine and make abstracts from any of their respective books and records and to discuss their respective affairs, finances and accounts with their respective officers, employees and independent public accountants (with representatives of the Borrower present in any discussions with such accountants), all at such reasonable times and as often as may reasonably be desired. H. SECTION Use of Proceeds. The proceeds of the Loans made under this Agreement will be used by the Borrower for general corporate purposes. None of such proceeds will be used, directly or indirectly, for the purpose, whether immediate, incidental or ultimate, of purchasing or carrying any 'margin stock' within the meaning of Regulation U or X. I. SECTION Environmental Matters. Except where the failure to do so would not have a reasonable probability of having a material adverse

effect on the business, operations or financial position of Borrower and its Restricted Subsidiaries, considered as a whole, the Borrower will (a) employ, and cause each of its Restricted Subsidiaries to employ, appropriate technology and compliance procedures to maintain compliance with all applicable Environmental Laws, (b) obtain and maintain, and cause each of its Restricted Subsidiaries to obtain and maintain, all material permits required by applicable Environmental Laws in connection with its or its Restricted Subsidiaries' operations, and (c) dispose of, and cause each of its Restricted Subsidiaries to dispose of, any and all substances reasonably known by Borrower to be hazardous or toxic substances only at facilities and with carriers reasonably believed to possess valid permits under applicable Environmental Laws. J. SECTION Delivery of Additional Guaranties. Within 30 Business Days following the delivery of any of the financial statements required by Section 5.01(a) or (b), the Borrower shall cause the delivery to the Agent of Guaranties from such additional Guarantors as may be necessary so that the aggregate assets of the Borrower and all Guarantors equal at least eighty percent (80%) of the total assets of the Borrower and its Consolidated Subsidiaries. VI. ARTICLE NEGATIVE COVENANTS Borrower agrees that, so long as any Bank has any Commitment hereunder or any amount payable under this Agreement remains unpaid, unless and to the extent the Majority Banks waive compliance in writing: A. SECTION Limitations on Liens. 1. Principal Plants. The Borrower will not create, assume, guarantee or otherwise become liable with respect to (collectively, "incur"), and will not cause, suffer or permit any Restricted Subsidiary to incur, any Debt secured by a Lien on any Principal Plant, or on any capital stock of any Restricted Subsidiary, without making effective provisions whereby the Commitments shall be equally and ratably secured thereby, provided that the foregoing shall not apply to: a) purchase money pledges of, or purchase money mortgages or liens on, property acquired (including through merger or consolidation) after the date of execution of this Agreement, so long as such pledges, mortgages and liens shall attach only to the assets so acquired, b) Liens existing at the time of acquisition (including through merger or consolidation) on property acquired after the date of execution of this Agreement, so long as such Liens (A) were not created or incurred in connection with or in contemplation of such acquisition and (B) shall attach only to the assets so acquired, c) Liens existing on property of a Subsidiary at the time it becomes a Restricted Subsidiary, so long as such Liens were not created or incurred in connection with or in contemplation of such Subsidiary becoming a Restricted Subsidiary, d) Liens to secure all or any part of the cost of development or construction of any property or assets or improvements thereon and which shall be released or satisfied within 120 days after completion of such development or construction, e) Liens required in connection with the acquisition, construction or development of additions or extensions to Principal Plants which shall be financed by obligations described in Section 103(b)(4)-(7) of the Code or by obligations entitled to substantially similar tax benefits under other legislation or regulations in effect from time to time, f) Liens securing Debt owing to the Borrower or a Restricted Subsidiary by a Restricted Subsidiary, g) Liens existing as of the Effective Date, h) extensions, renewals or replacements of pledges, mortgages or liens referred to in clauses (i) to (vii), inclusive, above, and any subsequent refinancings of the Debt secured thereby, provided that the amount of Debt secured by such extension, renewal, replacement or subsequent refinancing shall not exceed the principal amount of Debt being extended, renewed, replaced or subsequently refinanced, nor shall the pledge, mortgage or lien be extended to any additional Principal Plant or capital stock of any Restricted Subsidiary, i) Liens as permitted by subsection (b) of this Section, j) Liens as permitted by subsection (c) of this Section, or k) Liens arising by operation of law or in the ordinary course of business of the Borrower or a Restricted Subsidiary which do not secure Debt and do not in the aggregate materially detract from the value of its assets or materially impair the use thereof in the operation of its business. 2. After Acquired Property. If the Borrower or any Restricted Subsidiary shall at any time enter into a merger or consolidation with another Person or purchase all or substantially all of the assets of another Person, and if such other Person has outstanding indebtedness secured by a mortgage or other lien which, by reason of an after-acquired property clause or similar provision therein contained, would extend, after such merger, consolidation or purchase, to any Principal Plant owned by the Borrower or such Restricted Subsidiary immediately prior to such merger, consolidation or purchase, the Borrower or such Restricted Subsidiary, as the case may be, shall in such event be deemed to have created a mortgage or lien, within the prohibition of subsection (a) of this Section 6.01, unless (i) such merger or consolidation involving a Restricted Subsidiary shall constitute a disposition by the Borrower of its interest in the Restricted Subsidiary and the Borrower is otherwise in compliance with this Agreement, or (ii) either (A) at or prior to the effective date of such merger, consolidation, sale or purchase, such mortgage or lien shall have been released of record or otherwise satisfied to the extent it would extend to such Principal Plant or (B) prior to such merger, consolidation, sale or purchase, the Borrower or such Restricted Subsidiary, as the case may be, shall have created, as security for the Obligations, a valid lien which, upon completion of said merger, consolidation, sale or purchase, will rank equally with or prior to the lien of such mortgage or other lien of such other Person on such Principal Plant. 3. Permitted Debt. Notwithstanding the foregoing provisions of this Section 6.01, the Borrower and any one or more Restricted Subsidiaries may incur any Debt otherwise subject to the foregoing restrictions and in addition to that permitted by subsection (a) or (b) of this Section (other than pursuant to clause (x) of said subsection (a)), if, at the time of such incurrence and after giving effect thereto, the aggregate amount of Debt secured by pledges, mortgages or liens incurred pursuant to this subsection (c) which shall be outstanding at the time, when added to the aggregate amount of Debt incurred as permitted by Section 6.02(b) which shall be outstanding at the time and the aggregate amount of Debt incurred as permitted by Section 6.04 which shall be outstanding at the time (computed without duplication of amounts), does not exceed 15 percent of Net Tangible Assets and may renew, extend or replace such Debt subject to the proviso in clause (viii) of subsection (a) of this Section 6.01. B. SECTION Limitation on Debt of Restricted Subsidiaries. 1. Debt Limits. The Borrower will not permit any Restricted Subsidiary to create, assume, incur or otherwise become liable with respect to (collectively, "incur") any Debt, other than: a) Debt secured by a mortgage, pledge or lien which is permitted to such Restricted Subsidiary under the provisions of Section 6.01, b) Debt owed to the Borrower or any other Restricted Subsidiary, c) Debt of a Person existing at the time it becomes a Restricted Subsidiary (unless such Person becomes a Restricted Subsidiary by virtue of

(A) the classification or successive classification of such Person as a Restricted Subsidiary by the Board of Directors of Borrower or (B) the transfer of a Principal Plant to such Person by the Borrower or a Restricted Subsidiary), which Debt was not incurred in connection with or contemplation of becoming a Restricted Subsidiary, d) Debt created in connection with, or with a view to, compliance by such Restricted Subsidiary with the requirements of any program, law, statute or regulation of any federal, state or local governmental authority, which is applicable to such Restricted Subsidiary and which provides material financial or tax benefits to such Restricted Subsidiary which are not available to the Borrower or are available to the Borrower only on terms which the Borrower's Board of Directors determines are not as favorable as those available to the Restricted Subsidiary, e) guarantees existing at the Effective Date of this Agreement, f) guarantees and co-obligations of Debt with respect to which the Borrower is directly liable, and g) extensions, renewals or replacements of any Debt referred to in clauses (i) to (vi), inclusive, above, and any subsequent refinancings of such Debt, provided that the amount of Debt secured by such extension, renewal, replacement or subsequent refinancing shall not exceed the principal amount of Debt being extended, renewed, replaced or subsequently refinanced. 2. Permitted Debt. Notwithstanding the provisions of subsection (a) of this Section 6.02, the Borrower may permit any Restricted Subsidiary to incur Debt which would otherwise be prohibited by such provisions, if, at the time of such incurrence and after giving effect thereto, the aggregate amount of such Debt incurred pursuant to this subsection (b) which shall be outstanding at the time, when added to the aggregate amount of Debt incurred as permitted by Section 6.01(c) which shall be outstanding at the time and the aggregate amount of Debt incurred as permitted by Section 6.04 which shall be outstanding at the time (computed without duplication of amounts), does not exceed 15 percent of Net Tangible Assets and may permit such Restricted Subsidiary to renew, extend or replace any such Debt subject to the proviso in clause (vii) of subsection (a) of this Section 6.02. C. SECTION Consolidations, Mergers and Sales of Assets. Borrower will not merge or consolidate with or into, or convey, transfer, lease or otherwise dispose of (whether in one transaction or a series of related transactions) all or substantially all of its assets to, any Person, or permit any of its Restricted Subsidiaries to do so, except that (x) if no Default or Event of Default shall occur and be continuing immediately after giving effect to such transaction and (y) Borrower has delivered to the Banks a certificate of an Authorized Officer and an opinion of counsel to Borrower (which counsel may be an employee of the Borrower) reasonably satisfactory to the Majority Banks, each stating that such transaction complies with this Section 6.03 and that all conditions precedent to such transaction have been complied with: a) any Restricted Subsidiary of Borrower may merge or consolidate with or into, or dispose of assets as described above to, Borrower or any other Restricted Subsidiary, b) Borrower may merge or consolidate with or into any Person, including a Subsidiary, provided that Borrower is the survivor, if immediately after giving effect to such transaction, no Default or Event of Default shall occur and be continuing, and c) any Restricted Subsidiary may merge or consolidate with any Person (other than the Borrower or any other Restricted Subsidiary), provided that the Restricted Subsidiary is the survivor, if immediately after giving effect to such transaction, no Default or Event of Default shall occur and be continuing. D. SECTION Other Loan Agreements. So long as any Bank has any Commitment hereunder, except in connection with the contemporaneous refinancing of all outstanding Loans hereunder and the termination of all Commitments hereunder, Borrower will not enter into any other credit agreement containing terms covered by Articles V, VI, VII and VIII of this Agreement more restrictive on Borrower in any material respect under such credit agreement than the terms of such Articles under this Agreement are on the Borrower; provided that, the restriction contained in this Section 6.04 shall not apply (a) to restrict the incurrence of Debt by the Borrower under existing uncommitted lines of credit between Borrower and any of the Banks (and any continuations thereof) in accordance with their terms or under like credit arrangements with the Banks or other financial institutions or (b) to restrict the Borrower from entering into other credit agreements (or incurring Debt thereunder) otherwise subject to the foregoing restriction contained in this Section 6.04 under which the aggregate outstanding principal amount of Debt incurred under such agreements, at the time of such incurrence and after giving effect thereto, when added to the aggregate amounts of Debt permitted to be outstanding under Section 6.01(c) and 6.02(b), does not exceed 15 percent of Net Tangible Assets, and Borrower may renew, extend or replace any such Debt under such other credit agreements and subsequently refinance the same, provided that the amount of Debt so renewed, extended or replaced or subsequently refinanced thereof shall not exceed the principal amount of Debt being renewed, extended, replaced or subsequently refinanced. VII. ARTICLE FINANCIAL COVENANTS The Borrower agrees that, so long as any Bank has any Commitment hereunder or any amount payable under this Agreement remains unpaid, unless and to the extent the Majority Banks waive compliance in writing: A. SECTION Debt to Capitalization. Borrower will have Total Debt equal to or less than 50 percent of Capitalization, measured at the end of each fiscal quarter of Borrower (including the fourth quarter), as reported on Borrower's consolidated financial statements for such quarter. VIII. ARTICLE DEFAULTS AND EVENTS OF TERMINATION A. SECTION Events of Default. An "Event of Default" shall mean the occurrence of one or more of the following events or conditions (whatever the reason and whether voluntary, involuntary or by operation of law) and continuance thereof at a time when any Bank has any Commitment hereunder or any amount payable under this Agreement remains unpaid, unless and to the extent, subject to Section 11.06, the Majority Banks waive the same in writing: 1. Principal. Borrower shall fail to pay when due any principal of any Loan under this Agreement. 2. Interest. Borrower shall fail to pay when due any interest on any Loan, any fee or any other amount (other than principal) payable hereunder and such failure shall have continued for five Business Days. 3. Covenant Default. Borrower shall fail to observe or perform (i) any financial covenant contained in Article VII of this Agreement as of the applicable dates of determination of such covenants, or (ii) any other covenant or agreement contained in this Agreement and such failure shall have continued for 30 days after the earlier of (A) written notice thereof has been given to the Borrower by any Bank, or (B) any Authorized Officer of the Borrower shall have actual knowledge of the Borrower's failure to observe or perform any such other covenant or agreement contained in this Agreement. 4. Representations and Warranties. Any representation or warranty made by the Borrower in this Agreement or in any certificate, financial statement or other document delivered as required by this Agreement shall prove to have been incorrect in any material respect when made (or deemed made). 5. Monetary Default. Borrower or any Restricted Subsidiary shall fail to make any payment in respect to any Debt (other than (i) Debt the

aggregate principal amount of which does not exceed $20,000,000 and (ii) the Loans) when due (including any applicable grace period). 6. ERISA Default. Borrower or any ERISA Affiliate shall have committed a failure described in Section 302(f)(1) of ERISA or Section 412(n)(1) of the Code and shall have failed to obtain a waiver pursuant to Section 303 of ERISA and Section 412(d) of the Code with respect to such failure. 7. Change in Control. A Change in Control shall occur with respect to the Borrower. 8. Judgments. One or more judgments or orders for the payment of money in excess of $20,000,000 on a claim or claims not covered by insurance shall be rendered against the Borrower or any Restricted Subsidiary, and such judgments or orders shall have continued unsatisfied and in effect without being vacated, discharged, dismissed or stayed for 45 consecutive days after such judgments or orders shall have become final and nonappealable. 9. Voluntary Bankruptcy. Borrower or any Restricted Subsidiary shall commence a voluntary case or other proceeding seeking liquidation, reorganization or other relief with respect to itself or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of it or any substantial part of its property, or shall consent to any such relief or to the appointment of or taking possession by any such official in an involuntary case or other proceeding commenced against it, or shall make a general assignment for the benefit of creditors, or shall fail generally to pay its debts as they become due, or shall take any corporate action to authorize any of the foregoing. 10. Involuntary Bankruptcy. An involuntary case or other proceeding shall be commenced against the Borrower or any Restricted Subsidiary seeking liquidation, reorganization or other relief with respect to it or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of it or any substantial part of its property, and such involuntary case or other proceeding shall remain undismissed and unstayed for a period of 60 consecutive days; or an order granting any such relief or making any such appointment shall be entered against the Borrower or any Subsidiary under the federal bankruptcy laws as now or hereafter in effect and the continuance of such order unstayed and in effect for a period of 30 consecutive days. 11. Guarantor Default. Any Guarantor shall default in its obligations under its guaranty agreement delivered pursuant to this Agreement. B. SECTION Consequence of Event of Default. If there exists any Event of Default specified in subsections (a) through (h) of Section 8.01, then the Majority Banks may, by notice to the Borrower, (i) terminate the Commitments and they shall thereupon terminate, and (ii) declare the principal amount outstanding under all Loans (together with accrued interest thereon) to be, and the Loans shall thereupon become, immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower; provided that, if there exists any Event of Default specified in clause (i) or (j) of Section 8.01, then without any notice to the Borrower or any other act by the Banks, the Commitments shall thereupon terminate and the Loans (together with accrued interest thereon) shall become immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower. C. SECTION Notice of Default. Each Bank shall give notice to the other Banks promptly upon giving notice to Borrower under Section 8.01(c)(ii). IX. ARTICLE CHANGE IN CIRCUMSTANCES A. SECTION [This section 9.01 is reserved]. B. SECTION Illegality. If, after the Effective Date, the adoption of any applicable law, rule or regulation, or any change therein, or any change in the interpretation or administration thereof by any governmental authority, central bank or comparable agency charged with the interpretation or administration thereof, or compliance by any Bank (or its Lending Office) with any request or directive (whether or not having the force of law) of any such authority, central bank or comparable agency shall make it unlawful or impossible for any Bank (or its Lending Office) to make, maintain or fund one or more of its non- Base Rate Loans and such Bank shall so notify the other Banks and the Borrower, whereupon until such Bank notifies the Borrower and the other Banks that the circumstances giving rise to such suspension no longer exist, the obligation of such Bank (but no other Bank) to make such Loans shall be suspended. Before giving any notice pursuant to this Section, such Bank shall designate a different Lending Office or take other action if such designation or action will avoid the need for giving such notice and will not, in the judgment of such Bank, be otherwise disadvantageous to such Bank. If such Bank shall determine pursuant to this Section 9.02 that it may not lawfully continue to maintain and fund any of its outstanding non- Base Rate Loans to maturity and shall so specify in such notice, the Borrower shall immediately prepay in full the then outstanding principal amount of each such Loan, together with accrued interest thereon and the Borrower shall pay in full any amounts required pursuant to Section 2.13 hereof. Concurrently with prepaying each such Loan, the Borrower at its option shall borrow a Loan of any Type not affected by the suspension in an equal principal amount from such Bank (on which interest and principal shall be payable contemporaneously with the related Loans constituting the applicable Borrowing of the other Banks), and such Bank shall make such Loan. As of the Effective Date each Bank confirms that it has no knowledge of any event that would cause this Section to apply. After the Effective Date, each Bank will promptly notify the Borrower of any event of which it has knowledge that would cause this Section to apply. After a Bank gives notice as provided herein to suspend such Bank's obligations to make the affected Loans, until contrary notice is given by such Bank as provided herein, all Loans that would otherwise be made by such Bank but for the suspension shall be made at the Borrower's option as Loans of any Type not affected by the suspension (on which principal and interest shall be payable contemporaneously with the related Loans constituting the applicable Borrowing of the other Banks). C. SECTION Increased Cost. 1. Change in Law. If, after the Effective Date, the adoption of any applicable law, rule or regulation, or any change therein, or any change in the interpretation or administration thereof by any governmental authority, central bank or comparable agency of the United States (or political subdivision thereof) charged with the interpretation or administration thereof, or compliance by any Bank (or its Lending Office) with any request or directive (whether or not having the force of law) reflecting any of the foregoing of any such authority, central bank or comparable agency: a) shall subject any Bank (or its Lending Office) to any tax, duty or other charge with respect to the Bank's participation in this Agreement or shall change the basis of taxation of payments to any Bank (or its Lending Office) of the principal of or interest on its Loans or any other amounts due under this Agreement in respect thereof (except for changes in the rate of tax on the overall net income of such Bank or its Lending Office imposed by the jurisdiction in which such Bank's principal executive office or Lending Office is located), b) shall impose, modify or deem applicable any reserve, special deposit or similar requirement (including, without limitation, any such requirement imposed by the Board of Governors of the Federal Reserve System, but excluding (A) any requirement described in Section 9.04, and (B) any requirement included in any applicable Euro-Dollar Reserve Percentage) against assets of, deposits with or for the account of, or credit extended by, any Bank (or its Lending Office), or

c) shall impose on any Bank (or its Lending Office) or on the relevant market for such Bank's Loans, any other condition directly affecting such Loans or its obligation to make such Loans, and the result of any of the foregoing is to increase the cost to such Bank (or its Lending Office) of making or maintaining any Loan, or to reduce the amount of any sum received, receivable, or retained by such Bank (or its Lending Office) under this Agreement by an amount deemed by such Bank to be material, then within 15 days after demand by such Bank accompanied by the certificate referred to in subsection (b) of this Section, the Borrower shall pay to such Bank such additional amount or amounts as will compensate such Bank for such increased cost or reduction, provided such compensatory amounts relate to such increased costs or such reductions incurred by the Bank no more than 90 days prior to such demand or relate to a retroactive increased cost or reduction imposed on the Bank no more than 90 days prior to such demand. 1. Certificate. As of the Effective Date, each Bank confirms that it has no knowledge of any event that would entitle such Bank to compensation pursuant to this Section. After the Effective Date, each Bank will promptly notify the Borrower and Agent of any event of which it has knowledge which would entitle such Bank to compensation pursuant to this Section and will designate a different Lending Office or take other action if such designation or action would avoid the need for, or reduce the amount of, such compensation and will not, in the judgment of such Bank, be otherwise disadvantageous to such Bank. A certificate of any Bank claiming compensation under this Section setting forth the additional amount or amounts to be paid to it hereunder and the method of calculation in reasonable detail shall be conclusive in the absence of demonstrable error. In determining such amount, such Bank may use any reasonable averaging and attribution methods. 2. Substitute Loans. If any Bank has demanded compensation under this Section 9.03, at the option of the Borrower and upon five Business Days notice to Agent and such Bank, unless and until such Bank has notified Borrower and Agent that the circumstances giving rise to such demand no longer exist, (i) all Loans that would otherwise be made by such Bank of the Type for which the Bank has demanded compensation shall be made at the Borrower's option as any Type of Loan not affected by such demand (on which interest and principal shall be payable contemporaneously with the related Loans constituting the applicable Borrowing of the other Banks), and/or (ii) any outstanding Loans of such Bank of the Type affected by the demand shall be immediately prepaid in full with accrued interest thereon and the Borrower shall pay in full any amounts required pursuant to Section 2.13 hereof. Concurrently with prepaying each such Loan, the Borrower shall borrow at its option a Loan of any Type not affected by the demand in an equal principal amount from such Bank (on which interest and principal shall be payable contemporaneously with the related Loans constituting the applicable Borrowing of the other Banks), and such Bank shall make such Loan. D. SECTION Capital Adequacy. 1. Additional Compensation. If any Bank reasonably determines that the adoption of any applicable law, rule or regulation regarding capital adequacy, or any change therein, or any change in the interpretation or administration thereof by any governmental authority, central bank or comparable agency of the United States (or any political subdivision thereof) or the Bank for International Settlements ("BIS") charged with the interpretation or administration thereof, or compliance by any Bank (or its Lending Office) with any request or directive regarding capital adequacy (whether or not having the force of law) reflecting any of the foregoing of any such authority, central bank or comparable agency or the BIS, has or would have the effect of reducing the rate of return on the capital of such Bank or its "bank holding company," as defined in Section 1841(a) of the Bank Holding Company Act, as amended (herein "BHC"), as a direct consequence and cause of such Bank's obligations under this Agreement (taking into consideration such Bank's policies with respect to capital adequacy) by an amount deemed by such Bank to be material, then within 15 days after demand by such Bank accompanied by the certificate referred to in subsection (b) of this Section, the Borrower shall pay to such Bank (for the account of the BHC, as applicable) such additional amount or amounts as will compensate such Bank or BHC for such reduction to the extent the same is allocable to the Bank's obligations under this Agreement, provided such compensatory amounts relate to actual reductions incurred by the Bank or BHC no more than 90 days prior to such demand or relate to a retroactive reduction imposed on the Bank or BHC no more than 90 days prior to such demand. Certificate. As of the Effective Date, each Bank confirms that it has no knowledge of an event which would entitle such Bank or BHC to compensation pursuant to this Section. After the Effective Date, each Bank will promptly notify the Borrower of any event of which it has knowledge which would entitle such Bank or BHC to compensation pursuant to this Section and will designate a different Lending Office or take other action if such designation or action will avoid the need for, or reduce the amount of, such compensation and will not, in the judgment of such Bank, be otherwise disadvantageous to such Bank. A certificate of any Bank claiming compensation under this Section setting forth the additional amount or amounts to be paid to it hereunder and the method of calculation in reasonable detail (which shall indicate whether any demand relates to compensation of a BHC) shall be conclusive in the absence of demonstrable error. In determining such amount, such Bank may use any reasonable averaging and attribution methods. X. ARTICLE AGENT A. SECTION Appointment, Powers and Immunities. Each Bank hereby irrevocably appoints and authorizes Agent to act as its agent hereunder and under the other Loan Documents with such powers as are specifically delegated to Agent by the terms of this Agreement and the other Loan Documents, together with such other powers as are reasonably incidental thereto. Neither Agent nor any of its Affiliates, officers, directors, employees, attorneys or agents shall be liable for any action taken or omitted to be taken by any of them hereunder or otherwise in connection with this Agreement or any of the other Loan Documents except for its or their own gross negligence or willful misconduct. Without limiting the generality of the preceding sentence, Agent (a) may treat the payee of any Revolving Note as the holder thereof until Agent receives written notice of the assignment or transfer thereof signed by such payee and in form satisfactory to Agent, (b) shall have no duties or responsibilities except those expressly set forth in this Agreement and the other Loan Documents, and shall not by reason of this Agreement or any other Loan Document be a trustee or fiduciary for any Bank, (c) shall not be required to initiate any litigation or collection proceedings hereunder or under any other Loan Document except to the extent requested by the Majority Banks, (d) shall not be responsible to the Banks for any recitals, statements, representations or warranties contained in this Agreement or any other Loan Document, or any certificate or other document referred to or provided for in, or received by any of them under, this Agreement or any other Loan Document, or for the value, validity, effectiveness, enforceability or sufficiency of this Agreement or any other Loan Document or any other document referred to or provided for herein or therein or for any failure by any Person to perform any of its obligations hereunder or thereunder, (e) may consult with legal counsel, independent public accountants and other experts selected by it and shall not be liable for any action taken or omitted to be taken in good faith by it in accordance with the advice of such counsel, accountants or experts, and (f) shall incur no liability under or in respect of any Loan Document by acting upon any notice, consent, certificate or other instrument or writing reasonably believed by it to be genuine and signed or sent by the proper party or parties. As to any matters not expressly provided for by this Agreement, Agent shall in all cases be fully protected in acting, or in refraining from acting, hereunder in accordance with instructions signed by the Majority Banks, and such instructions of the Majority Banks, and any action taken or failure to act pursuant thereto shall be

binding on all of the Banks; provided, however, that Agent shall not be required to take any action which exposes Agent to liability or which is contrary to this Agreement or any other Loan Document or applicable law. B. SECTION Rights of Agent as a Bank. With respect to its Commitment, the Loans made by it and the Revolving Note issued to it, NationsBank (and any successor acting as Agent) in its capacity as a Bank hereunder shall have the same rights and powers hereunder as any other Bank and may exercise the same as though it were not acting as Agent, and the term "Bank" or "Banks" shall, unless the context otherwise indicates, include Agent in its individual capacity. Agent and its Affiliates may (without having to account therefor to any Bank) accept deposits from, lend money to, act as trustee under indentures of, provide merchant banking services to, own securities of, and generally engage in any kind of banking, trust or other business with, the Loan Parties or any of their Affiliates and any other Person who may do business with or own securities of the Loan Parties or any of their Affiliates, all as if it were not acting as Agent and without any duty to account therefor to the Banks. C. SECTION Defaults. Agent shall not be deemed to have knowledge or notice of the occurrence of a Default (other than the non-payment of principal of or interest on the Loans or of commitment fees) unless Agent has received notice from a Bank or Borrower specifying such Default and stating that such notice is a "notice of default". In the event that Agent receives such a notice of the occurrence of a Default, Agent shall give prompt notice thereof to the Banks (and shall give each Bank prompt notice of each such non-payment). Agent shall (subject to Section 10.1) take such action with respect to such Default as shall be directed by the Majority Banks, provided that unless and until Agent shall have received such directions, Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default as it shall seem advisable and in the best interest of the Banks. D. SECTION INDEMNIFICATION. EACH BANK HEREBY AGREES TO INDEMNIFY AGENT FROM AND HOLD AGENT HARMLESS AGAINST (TO THE EXTENT NOT REIMBURSED UNDER SECTION 11.03, BUT WITHOUT LIMITING THE OBLIGATIONS OF THE LOAN PARTIES UNDER SECTION 11.03), RATABLY IN ACCORDANCE WITH ITS PRO RATA SHARE, ANY AND ALL LIABILITIES (INCLUDING, WITHOUT LIMITAT ION, ENVIRONMENTAL LIABILITIES), OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, DEFICIENCIES, SUITS, COSTS, EXPENSES (INCLUDING ATTORNEYS' FEES) AND DISBURSEMENTS OF ANY KIND OR NATURE WHATSOEVER WHICH MAY BE IMPOSED ON, INCURRED BY OR ASSERTED AGAINST AGENT IN ANY WAY RELATING TO OR ARISING OUT OF ANY OF THE LOAN DOCUMENTS OR ANY ACTION TAKEN OR OMITTED TO BE TAKEN BY AGENT UNDER OR IN RESPECT OF ANY OF THE LOAN DOCUMENTS; PROVIDED, FURTHER, THAT NO BANK SHALL BE LIABLE FOR ANY PORTION OF THE FOREGOING TO THE EXTENT CAUSED BY AGENT'S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT. WITHOUT LIMITATION OF THE FOREGOING, IT IS THE EXPRESS INTENTION OF THE BANKS THAT AGENT SHALL BE INDEMNIFIED HEREUNDER FROM AND HELD HARMLESS AGAINST ALL OF SUCH LIABILITIES (INCLUDING, WITHOUT LIMITATION, ENVIRONMENTAL LIABILITIES), OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, DEFICIENCIES, SUITS, COSTS, EXPENSES (INCLUDING ATTORNEYS' FEES) AND DISBURSEMENTS OF ANY KIND OR NATURE DIRECTLY OR INDIRECTLY ARISING OUT OF OR RESULTING FROM THE SOLE OR CONTRIBUTORY NEGLIGENCE OF SUCH PARTY (EXCEPT TO THE EXTENT THE SAME ARE CAUSED BY SUCH PARTY'S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT). WITHOUT LIMITING ANY OTHER PROVISION OF THIS SECTION 10.04, EACH BANK AGREES TO REIMBURSE AGENT PROMPTLY UPON DEMAND FOR ITS PRO RATA SHARE OF ANY AND ALL OUT-OF-POCKET EXPENSES (INCLUDING ATTORNEYS' FEES) INCURRED BY AGENT IN CONNECTION WITH THE PREPARATION, EXECUTION, DELIVERY, ADMINISTRATION, MODIFICATION, AMENDMENT OR ENFORCEMENT (WHETHER THROUGH NEGOTIATIONS, LEGAL PROCEEDINGS OR OTHERWISE) OF, OR LEGAL ADVICE IN RESPECT OF RIGHTS OR RESPONSIBILITIES UNDER, THE LOAN DOCUMENTS, TO THE EXTENT THAT AGENT OR ANY BANK IS NOT PROMPTLY REIMBURSED FOR SUCH EXPENSES BY BORROWER. E. SECTION Independent Credit Decisions. Each Bank agrees that it has independently and without reliance on Agent, Co-Agent, Managing Agent or any other Bank, and based on such documents and information as it has deemed appropriate, made its own credit analysis of Borrower and its Subsidiaries and the other Loan Parties and its own decision to enter into this Agreement and that it will, independently and without reliance upon Agent, Co-Agent, Managing Agent or any other Bank, and based upon such documents and information as it shall deem appropriate at the time, continue to make its own analysis and decisions in taking or not taking action under this Agreement or any of the other Loan Documents. None of Agent, Co-Agent or Managing Agent shall be required to keep itself informed as to the performance or observance by any Loan Party of this Agreement or any other Loan Document or to inspect the properties or books of any Loan Party. Except for notices, reports and other documents and information expressly required to be furnished to the Banks by Agent, Co-Agent or Managing Agent hereunder or under the other Loan Documents, none of Agent, Co-Agent or Managing Agent shall have any duty or responsibility to provide any Bank with any credit or other financial information concerning the affairs, financial condition or business of any Loan Party (or any of their Affiliates) which may come into the possession of Agent, Co-Agent or Managing Agent or any of its Affiliates. F. SECTION Several Commitments. The Commitments and other obligations of the Banks under this Agreement are several. The default by any Bank in making a Loan in accordance with its Commitment shall not relieve the other Banks of their obligations under this Agreement. In the event of any default by any Bank in making any Loan, each nondefaulting Bank shall be obligated to make its Loan but shall not be obligated to advance the amount which the defaulting Bank was required to advance hereunder. In no event shall any Bank be required to advance an amount or amounts with respect to any of the Loans which would in the aggregate exceed such Bank's Commitment with respect to such Loans. No Bank shall be responsible for any act or omission of any other Bank. G. SECTION Successor Agent. Subject to the appointment and acceptance of a successor Agent as provided below, (i) Agent may resign at any time by giving notice thereof to the Banks and Borrower, or (ii) Agent may be removed upon the written direction of the Borrower and the Majority Banks. Upon any such resignation or removal, the Majority Banks will have the right to appoint another Bank as a successor Agent; provided however, so long as no Default exists, any such successor Agent must also be approved by Borrower, which approval may not be unreasonably withheld. If no successor Agent shall have been so appointed by the Majority Banks and shall have accepted such appointment within thirty (30) days after the retiring Agent's giving of notice of resignation or its receipt of a written direction of its removal, then the Managing Agent shall succeed to the position of successor Agent hereunder. Upon the acceptance of its appointment as successor Agent, such successor Agent shall thereupon succeed to and become vested with all rights, powers, privileges, immunities and duties of the resigning or removed Agent, and the resigning or removed Agent shall be discharged from its duties and obligations under this Agreement and the other Loan Documents. After any Agent's resignation as Agent, the provisions of this Article X shall continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it was Agent. Each Agent (including each successor Agent) agrees that, so long as it is acting as Agent under

this Agreement, it shall be a Bank under this Agreement. XI. ARTICLE MISCELLANEOUS A. SECTION Notices. Except where telephonic instructions or notices are authorized, all notices and other communications provided for hereunder shall be in writing. Telephonic notice, which shall be effective when telephoned, shall be promptly confirmed in writing. Any notices and other communications between the parties hereto to be given in writing shall be given by mailing the same, postage prepaid, or by telex, cable, facsimile or personal delivery to each party at its address set forth on the signature pages hereto or Schedule 1 or to such other addresses as any such party may in writing hereafter indicate. All such notices and communications shall be effective (a) when received if mailed by first-class U.S. mails or sent by overnight courier, (b) when delivered to the telegraph company if telegraphed, (c) when confirmed by telex answer back if telexed, (d) when confirmed by the transmitting party as being received if sent by facsimile machine and (e) in all other cases, when delivered or received. Any communications between the parties hereto authorized to be given by telephone (which shall be effective when telephoned) shall be confirmed in writing by the party initiating the communication as provided in the Agreement. B. SECTION No Waivers. No failure or delay by Agent, Co- Agent, Managing Agent or any Bank in exercising any right, power or privilege hereunder shall operate as a waiver thereof, except as and to the extent of an express time limit contained in this Agreement or as may be barred by the applicable statute of limitations, nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by law. C. SECTION Expenses, etc. Borrower agrees to pay, and agrees to save Agent, Co-Agent, Managing Agent and each Bank harmless against any loss, liability, claim, damage or expenses incurred by Agent, Co-Agent, Managing Agent or any Bank related to, (i) all reasonable out-of-pocket expenses and attorneys fees of such parties in connection with the review and negotiation (whether or not closed), execution and delivery of this Agreement or with any other document entered into in connection herewith, (ii) all reasonable out- of-pocket expenses and attorneys fees of such parties in connection with any waiver, consent or amendment to this Agreement or any waiver, consent or amendment to any other document entered into in connection herewith, (iii) if an Event of Default occurs, all reasonable out-of-pocket expenses and attorneys fees of such parties in connection with such Event of Default and the investigation, collection and other enforcement proceedings resulting therefrom, (iv) all stamp, documentary, transfer, recording or filing taxes and fees or like impositions and charges determined by such parties to be payable in connection with the execution and delivery (but not the ongoing performance of) this Agreement, and related to or arising out of any delay or omission by Borrower to pay the same, and (v) any investigative, administrative or judicial proceeding relating to or arising out of any actual or proposed use of proceeds of Loans under this Agreement; provided that no such party shall have the right to be indemnified hereunder for its own gross negligence or willful misconduct as determined by a court of competent jurisdiction. D. SECTION Set-Offs. 1. Set-Offs. Upon the occurrence of an Event of Default and so long as such Event of Default is continuing, Agent, Co-Agent, Managing Agent and each Bank shall have the right, in addition to all other rights and remedies available to it, without notice to the Borrower, to set-off against and to appropriate and apply to the Obligations owed to such party that shall have become due and payable (by acceleration or otherwise), any debt owing to, and any other funds held in any manner for the account of, the Borrower by such party including, without limitation, all funds in all deposit accounts (whether time or demand, general or special, provisionally credited or finally credited, or otherwise) now or hereafter maintained by the Borrower with any such party. Such right shall exist whether or not the party exercising such right of set-off shall have made any demand hereunder, whether such debt owing to or funds held for the account of the Borrower is or are matured or unmatured, and regardless of the existence or adequacy of any collateral, guaranty or any other security, right or remedy available to such party. Each party exercising such right of set-off shall promptly notify Borrower of any set- off hereunder, but the failure to give notice shall not affect the validity of such set-off. 2. Sharing of Recoveries. Each Bank agrees that if it shall, by exercising any right of set-off or counterclaim or otherwise, receive payment of a proportion of the aggregate amount of principal and interest due with respect to Loans owed to it which is greater than the proportion received by any other Bank in respect of the aggregate amount of principal and interest due with respect to Loans owed to such other Bank, the Bank receiving such proportionately greater payment shall purchase such participations in the Loans owed to the other Banks, and such other adjustments shall be made, as may be required so that all such payments of principal and interest with respect to the Loans shall be shared by the Banks on a Pro Rata Share basis; provided that if all or any portion of such excess amount is thereafter recovered from such Bank, such purchase shall be rescinded and the purchase price restored to the extent of such recovery, without interest. E. SECTION Taxes. 1. Bank Income Tax. Notwithstanding any other provision of this Agreement, Borrower shall not be obligated to pay, directly or indirectly, any franchise tax imposed on, or any tax on or measured by the overall net income or gross income of, any Bank (or Lending Office) by any jurisdiction or taxing authority, or any withholding tax required to be withheld by Borrower thereon by any jurisdiction or taxing authority. 2. Withholding Tax. If any Bank is a "foreign corporation" within the meaning of the Code, such Bank shall deliver to the Borrower: a) if such Bank claims an exemption from, or a reduction of, United States withholding tax under a tax treaty, a properly completed Internal Revenue Service ("IRS") form 1001 on or before the Effective Date, or if the Borrower consents in writing, before the payment of any interest in the first calendar year and in each third succeeding calendar year during which interest may be paid under this Agreement, b) if such Bank claims that interest paid under this Agreement is exempt from United States withholding tax because it is effectively connected with a United States trade or business of such Bank, two properly completed and executed copies of IRS form 4224 on or before the Effective Date, or if the Borrower consents in writing, before the payment of any interest is due in the first taxable year of such Bank and in each succeeding taxable year of such Bank during which interest may be paid under this Agreement, or c) such other form or forms on or before such other time or times as may be required under the Code or other laws of the United States as a condition to exemption from, or reduction of, United States withholding tax because of the basis on which such exemption or reduction is claimed by such Bank. Such Bank agrees to notify the Borrower of any change in circumstances which would modify or render invalid any claimed exemption or reduction. Where any Bank is entitled to a reduction in the applicable withholding tax, the Borrower may withhold from any interest payment to such Bank an amount equivalent to the applicable withholding tax after taking into account such reduction. If the forms or other documentation required by this Section 11.05 hereof are not delivered to the Borrower, then the Borrower may withhold from any interest payment to the Bank not providing such forms or other documentation, an amount equivalent to the applicable withholding tax. If the IRS or any authority of the United States or other jurisdiction asserts a claim that the Borrower did not properly withhold tax from amounts paid to or for the account of any Bank (because the appropriate form was not delivered, was not properly executed, or because such Bank failed

to notify the Borrower of a change in circumstances which rendered the exemption from, or reduction of, withholding tax ineffective, or for any other reason) such Bank shall indemnify the Borrower fully for all amounts paid, directly or indirectly, by the Borrower as tax or otherwise, including penalties and interest, together with all expenses incurred, including legal expenses, allocated staff costs, and any out-of-pocket expenses. In the event that any Bank assigns any of its rights hereunder pursuant to Section 11.08 hereof, the assignee shall comply and be bound by the terms of this Section 11.05 as though it were the assignor Bank. F. SECTION Amendments and Waivers. This Agreement and any provision of this Agreement may be amended, supplemented, modified or waived if and only if such amendment, supplement, modification or waiver is in writing and is signed by the Borrower, Agent and the Majority Banks; provided that no such amendment, supplement, waiver or modification shall, unless signed by Agent and all the Banks, (i) increase or decrease the Commitment of any Bank or subject any Bank to any additional obligation, (ii) reduce the principal of or rate of interest on any Loan or any fees hereunder, (iii) postpone the date fixed for any payment of principal of or interest on any Loan or any fees hereunder, (iv) change the amount of the Commitments or the aggregate unpaid principal amount of the Loans or the number of Banks that shall be required for the Banks or any of them to take any action under this Section or any other provision of this Agreement, (v) extend the Termination Date except as provided in Section 2.18, or (vi) terminate or release any guaranty signed by any Guarantor or modify or amend any such guaranty in a manner that would have the effect of modifying any provisions of such guaranty with respect to matters described in items (i) through (v) of this Section 11.06. Notwithstanding the foregoing, any amendment, supplement, modification or waiver to the provisions of this Agreement relating to any outstanding Bid Loan under a Bid Borrowing may be made if the same is in writing and signed by the Borrower and all Bid Banks that are participants in such Bid Borrowing. G. SECTION Replacement of Banks. If any Bank (a "Notice Bank") makes demand for amounts owed under Section 9.03 or Section 9.04 or 11.03(iv) or gives notice under Section 9.02 that it can no longer participate in Loans or if the Borrower elects to replace a Non-Consenting Bank pursuant to Section 2.18, then in each case Borrower shall have the right, if no Default or Event of Default exists, and subject to the terms and conditions set forth in Section 11.08, to designate an Eligible Assignee (a "Replacement Bank") to purchase the Notice Bank's share of outstanding Loans and to assume the Notice Bank's obligations to Borrower under this Agreement. Subject to the foregoing, the Notice Bank or Non- Consenting Bank agrees to assign to the Replacement Bank its share of outstanding Loans and its Commitment and to delegate to the Replacement Bank its obligations to Borrower under this Agreement pursuant to an Assignment and Acceptance in substantially the form attached hereto as Exhibit I, and the Replacement Bank shall pay to the Notice Bank all amounts then outstanding hereunder and payable to the Notice Bank (whether or not such amounts are then otherwise due). Without in any way prejudicing the rights of the Banks to make demand and receive compensation or reimbursement pursuant to the Sections named above, nothing in those Sections shall give any Bank the right to receive the same amount more than once and each Bank shall promptly pay after discovery thereof any such excess amount so received to the Borrower. Borrower shall pay or reimburse such Notice Bank for its reasonable expenses, if any, incurred in connection with such assignment. H. SECTION Assignments and Participations. 1. Successors and Assigns. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permissible assigns; provided that except as provided in Section 6.03, the Borrower may not assign or otherwise transfer any of its rights under this Agreement without the prior written consent of Agent and all the Banks. 2. Assignments. Each Bank may (and if requested by Borrower pursuant to Section 11.07 upon at least 20 Business Days' notice to such Bank will) assign to one or more Banks or other entities all or a portion of its rights and obligations under this Agreement (including, without limitation, all or a portion of its Commitment and the Syndicated Loans owing to it); provided, however, that a) each such assignment shall be of a constant, and not a varying, percentage of all rights and obligations under this Agreement (other than any Bid Loans) b) the amount of the Commitment of the assigning Bank being assigned pursuant to each such assignment (determined as of the date of the Assignment and Acceptance with respect to such assignment) shall in no event be less than 50% of all such rights and obligations of the Assignor or less than $10,000,000 (in aggregate outstandings and unused Commitment) and shall be an integral multiple of $1,000,000 in excess thereof; provided however, a Bank which cannot satisfy the above-described requirements may assign all of its Commitment, c) each such assignment shall be to an Eligible Assignee and shall require the prior consent of Borrower (not unreasonably withheld); provided, that, only prior notice to the Borrower need be given if such assignment is made to an Affiliate of the assignor or to another Bank hereunder, d) each such assignment made as a result of a demand by Borrower pursuant to Section 11.07 shall be arranged by Borrower at its expense, and shall be either an assignment of all of the rights and obligations of the assigning Bank under this Agreement or an assignment of a portion of such rights and obligations made concurrently with one or more other such assignments which together cover all of the rights and obligations of the assigning Bank under this Agreement, e) no Bank shall be obligated to make any such assignment as a result of a demand by the Borrower pursuant to Section 11.07 unless and until such Bank shall have received one or more payments from either Borrower or one or more Eligible Assignees in an aggregate amount at least equal to the aggregate outstanding principal amount of the Loans then owing to such Bank, together with accrued interest thereon to the date of payment of such principal amount and all other amounts then due and payable to such Bank under this Agreement, and f) the parties to each such assignment shall execute and deliver to Agent for its acceptance and recording in the Register (as defined in Section 2.10(b)) an Assignment and Acceptance, together with the Revolving Note subject to such Assignment and Acceptance, and a processing and recordation fee of $3,500. Upon its receipt of an Assignment and Acceptance executed by an Assigning Lender and Assignee representing that it is an Eligible Assignee, together with the Revolving Note subject to such assignment, Agent shall, if such Assignment and Acceptance has been completed and is in substantially the form of Exhibit I hereto, (i) accept such Assignment and Acceptance, (ii) record the information contained therein in the Register, and (iii) give prompt written notice thereof to the Borrower. Within five Business Days after its receipt of such notice, the Borrower, at its expense, shall execute and deliver to the Agent in exchange for each surrendered Revolving Note evidencing the Loans, a new Revolving Note evidencing such Loans payable to the order of such Eligible Assignee in an amount equal to such Loans assigned to it and, if the Assigning Lender has retained any Loans, a new Revolving Note evidencing each such Loans payable to the order of the Assigning Lender in the amount of such Loans retained by it (each such promissory note shall constitute a "Revolving Note" for purposes of the Loan Documents). Such new Revolving Notes shall be dated the effective date of such Assignment and Acceptance and shall otherwise be in substantially the form of Exhibit A hereto. Upon such execution, delivery, acceptance and recording, from and after the effective date specified in each Assignment and Acceptance, (x) the assignee thereunder shall be a party hereto and, to the extent that rights and obligations hereunder have been assigned to it pursuant to such Assignment and Acceptance, have the rights and obligations of a Bank hereunder and (y)

the Bank assignor thereunder shall, to the extent that rights and obligations hereunder have been assigned by it pursuant to such Assignment and Acceptance, relinquish its rights and be released from its obligations under this Agreement (and, in the case of an Assignment and Acceptance covering all or the remaining portion of an assigning Bank's rights and obligations under this Agreement, such Bank shall cease to be a party hereto). Notwithstanding any other provision to the contrary contained in this Agreement, any Bank may, without the consent of the Borrower, assign all or a portion of its rights under this Agreement and any notes which may be issued hereunder to a Federal Reserve Bank as collateral in accordance with Regulation A of the Board of Governors of the Federal Reserve System and the applicable operating circular of such Federal Reserve Bank. 1. Bid Loans. Each Bank may assign to or participate with one or more banks or other entities any Bid Loans held by it without regard to the restrictions placed on assignments elsewhere in this Section 11.08; provided, that, any participation shall be made in accordance with subsection (d) hereof and provided, further, that any assignee of a Bid Loan that is not then a Bank hereunder shall not be entitled to demand any payments under Sections 9.03, 9.04 and 11.03 hereof and shall have no voting rights or other rights of a Bank hereunder other than the right to demand and receive interest and principal payments at the times when due with respect to the Bid Loans owned by it. 2. Participations. Each Bank may sell participations to one or more Persons in or to all or a portion of its rights and obligations under this Agreement (including, without limitation, all or a portion of its Commitment and the Loans owing to it); provided, however, that a) such Bank's obligations under this Agreement (including without limitation, its Commitment to Borrower hereunder) shall remain unchanged, b) such Bank shall remain solely responsible to the other parties hereto for the performance of such obligations, c) such Bank shall remain the owner of any Loan for all purposes of this Agreement, and d) Borrower and the other Banks shall continue to deal solely and directly with such Bank in connection with such Bank's rights and obligations under this Agreement. Subject to the foregoing the purchaser of such participation shall, to the fullest extent permitted by law, have the same, but no more, rights and benefits hereunder as it would have if it were a Bank party to this Agreement to the extent the selling Bank would have had such rights and benefits; and provided, however, that each such participation shall be granted pursuant to an agreement providing that the purchaser thereof shall not have the right to vote on, consent or object to any matters relating to the Agreement other than through the selling Bank and then only with respect to any action that would (1) reduce principal of or interest on any Loan, or other amounts or fees in which such purchaser has an interest, (2) postpone any date fixed for payment of principal of or interest on any such Loan, or other amounts or such fees in which such purchaser has an interest, and (3) extend the Termination Date. 3. Notice of Assignments and Participations. The Borrower may, for all purposes of this Agreement, treat any Bank as the owner of the Loans made by such Bank until written notice of assignment shall have been received by Borrower. Upon written request of Borrower to a Bank, such Bank shall inform the Borrower of the Dollar amount of any Full Term Participation (as hereinafter defined) that such Bank has entered into; provided, however, that no Bank shall be obligated to disclose such information if the disclosure thereof would constitute a violation of law or regulation or violate any confidentiality agreement to which such Bank is subject. For the purposes of this subsection, "Full Term Participation" means a participation by a Bank to another Person whereby such other Person has purchased (pursuant to a participation agreement) all or a portion of such Bank's Commitment from the effective date of such participation agreement to the Termination Date. 4. Subsequent Participations and Assignments. Persons who have become assignees or participants pursuant to this Section 11.08 may grant such further assignments and participations only by complying with the same procedures that a Bank would be required to follow hereunder. I. SECTION Collateral. Each of the Banks represents to each of the other Banks that it in good faith is not relying upon any "margin stock" (as defined in Regulation U) as collateral in the extension or maintenance of the credit provided for in this Agreement. J. SECTION Confidentiality. Each of Agent, Co-Agent, Managing Agent and each Bank (each a "Confidentiality Party") agrees that all documentation and other information made available by the Borrower to such parties under the terms of this Agreement shall (except to the extent required by legal or governmental process or otherwise by law, or if requested by any duly constituted state or federal bank regulatory agency, or if such documentation and other information is publicly available or hereafter becomes publicly available other than by action of such Confidentiality Party, or was theretofore known to such party independent of any disclosure thereto by the Borrower) be held in the strictest confidence by such Confidentiality Party and used solely in connection with the administration of Loans from time to time outstanding hereunder to the Borrower; provided that (i) such Confidentiality Party may disclose such documentation and other information to any other bank to which such Confidentiality Party sells or proposes to sell a participation in its Loans hereunder, if such other bank, prior to such disclosure, agrees for the benefit of the Borrower to comply with the provisions of this Section; (ii) such Confidentiality Party may disclose the provisions of this Agreement and the amounts, maturities and interest rates of its Loans to any purchaser or potential purchaser of such party's interest in any Loan, and (iii) such Confidentiality Party may disclose such documentation and other information to any officer, director, agent, employee, attorney or other advisor of such party, with a need to know such information for the purpose of administering this agreement, so long as such individual is obligated to comply with the provisions of this Section. K. SECTION Alternative Liquidity. From time to time after the Effective Date the Borrower may decide to issue its commercial paper in the commercial paper markets and, in that regard, use the credit available under the Commitments as a source of alternative liquidity for purposes of obtaining or enhancing a rating on its commercial paper by Standard & Poor's Corporation or Moody's Investors Service or similar nationally recognized rating organizations. L. SECTION Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK. M. SECTION WAIVER OF JURY TRIAL. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND EXPRESSLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED UPON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO ANY OF THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREBY OR THE ACTIONS OF THE AGENT, C0-AGENT, MANAGING AGENT OR ANY BANK IN THE NEGOTIATION, ADMINISTRATION OR ENFORCEMENT THEREOF. N. SECTION Counterparts; Integration. This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. This Agreement constitutes the entire agreement and understanding among the parties hereto and supersedes any and all prior agreements and understandings, oral or written, relating to the subject matter hereof.

IN WITNESS WHEREOF, this Agreement is executed and delivered as of the day first above written.

BORROWER:

AGENT:

NATIONSBANK OF TEXAS, N.A.

Title:

Address for Notices:

777 South Figueroa Street, 4th

Floor Los Angeles, California 90017- 5800

MANAGING AGENT:

WACHOVIA BANK, N.A.

Account to which Loans ADOLPH COORS COM PANY are to be advanced: By: [describe account] Name: Title: Address for Notices: 12th & Ford Streets Mail Number BC560 Golden, Colorado 8040 1 Attention: Michel le Woulfe Telephone: 303-27 7-6778 Telecopy: 303-277-563 6

By: Name: Title: Address for Notices: 901 Main Street, 67th Floor Dallas, Texas 75202 Attention: Natali e Hebert Telephone: 214-50 8-9060 Telecopy: 214-508-098 0 CO-AGENT: THE FIRST NATIONAL BANK OF CHICAGO By: Name:

Attention: Anthony Mathews Telephone: 213-683-1957 Telecopy: 213-683-4999

By: Name: Title: Address for Notices: 191 Peachtree Street, N.E. Atlanta, Georgia 3030 3 Attention: Willia m Hamlet Telephone: 404-33 2-5570 Telecopy: 404-332-689 8 LENDERS: Commitment: $37,000,000 NATIONSBANK O F TEXAS, N.A.

Address for Notices:

555 California Street, 41st

Floor San Francisco, California 94104

Commitment: $15,000,000 U.S. BANK NATIONAL ASSOCIATION,

dba Colorado National Bank By:

Name: Title:

Address for Notices: 950 Seventeenth Street, Suite

300

Title:

Address for Notices:

777 South Figueroa Street, 4th

Floor Los Angeles, California 90017- 5800

By: Name: Title: Address for Notices: 901 Main Street, 67th Floor Dallas, Texas 75202 Attention: Natali e Hebert Telephone: 214-50 8-9060 Telecopy: 214-508- 0980Commitment: $25,000,000 BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION By: Name: Title:

Attention: Kevin Leader Telephone: 415-622-4585 Telecopy: 415-622-8168

Denver, Colorado 8020 2 Attention: Andrea Koeneke Telephone: 303-58 5-4234 Telecopy: 303-585-627 3 Commitment: $30,000,000 THE FIRST NATIO NAL BANK OF CHICAGO By: Name:

Attention: Anthon y Mathews Telephone: 213-68 3-1957 Telecopy: 213-683-499 9 Commitment: $15,000,000 NORWEST BANK COLORADO, N.A. By: Name:

End of Filing

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Title: Address for Notices: 1740 Broadway Denver, Colorado 8027 4-8673 Attention: Katy J ones Telephone: 303-86 3-5070 Telecopy: 303-863-667 0 Commitment: $15,000,000 SUMITOMO BANK, L IMITED By: Name: Title: Address for Notices: 777 South Figueroa, S uite 2600 Los Angeles, Californ ia 90017 Attention: Michae l Jackson Telephone: 213-95 5-3933 Telecopy: 213-623-683 2 Commitment: $25,000,000 UNION B ANK OF SWITZERLAND, New York Branch By: Name: Title: By: Name: Title: Address for Notices: 200 Park Avenue New York, New York 10 171 Attention: Paula Mueller Telephone: 212-82 1-3339 Telecopy: 212-821-338 3 Commitment: $35,000,000 WACHOVIA BANK, N .A. By: Name: Title: Address for Notices: 191 Peachtree Street, N.E. Atlanta, Georgia 3030 3 Attention: Willia m Hamlet Telephone: 404-33 2-5570 Telecopy: 404-332-689 8 Commitment: $3,000,000 SEAWAY NATIONAL BANK By: Name: Title: Address for Notices: 645 East 87th Street Chicago, Illinois 606 19 Attention: O. Victoria Lakes-Battle Telephone: 773-60 2-4153