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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-QSB

(MARK ONE)



|[X] | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES AND EXCHANGE ACT OF 1934
|--- | -------------------------------------------------------------------------------------------

For Quarterly Period Ended September 30, 2002



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

Commission File Number: 0-26804

PLANET POLYMER TECHNOLOGIES, INC.




(Exact name of small business issuer as specified in its character)


|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|CALIFORNIA                                                     |  | 33-0502606                          
|                                                              
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification No.)

|                                                |  |           
|----------------------------------------------- |  | ----------
|9985 Businesspark Avenue, San Diego, California |  | 92131     
|                                               
|(Address of principal executive offices)        |  | (Zip Code)

(858) 549-5130




(Issuers telephone number, including area code)


Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act 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.

[X] YES    [   ] NO

Indicate the number of shares outstanding of each of the issuers classes of
common stock, as of the latest practicable date:

|                           |  |                                   |           | 
|-------------------------- |  | --------------------------------- | --------- | 
|Class                      |  | Outstanding at September 30, 2002
|                           |  |                                  
|Common Stock, no par value |  |                                   | 9,207,884 | 





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TABLE OF CONTENTS



|                               |                                                                                                |                                                         |  |  |  |  |  | 
|------------------------------ | ---------------------------------------------------------------------------------------------- | ------------------------------------------------------- |  |  |  |  |  | 
|                               |                                                                                                | CONDENSED BALANCE SHEET (UNAUDITED)                    
|                               |                                                                                                | CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)         
|                               |                                                                                                | CONDENSED STATEMENT OF SHAREHOLDERS EQUITY (UNAUDITED)
|                               |                                                                                                | CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)         
|                               |                                                                                                | NOTES TO UNAUDITED FINANCIAL STATEMENTS                
|PART I  FINANCIAL INFORMATION
|                               | Item 2  Managements Discussion and Analysis of Financial Condition and Results of Operations
|                               | Item 3  Controls and Procedures                                                              
|PART II  OTHER INFORMATION   
|                               | Item 1  Legal Proceedings                                                                    
|                               | Item 2  Changes in Securities:                                                               
|                               | Item 3  Defaults upon Senior Securities:                                                     
|                               | Item 4  Submission of Matters to a Vote of Security Holders:                                 
|                               | Item 5  Other Information:                                                                   
|                               | Item 6  Exhibits and Reports on Form 8-K:                                                    
|SIGNATURES                    
|SECTION 302 CERTIFICATION     
|EXHIBIT 10.36                 
|EXHIBIT 99.1                  



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PLANET POLYMER TECHNOLOGIES, INC.
FORM 10-QSB QUARTERLY REPORT
QUARTER ENDED SEPTEMBER 30, 2002

INDEX

|                               |        |  |                                                                                       |    |  |                                                                                                       |  |  |   |          |  | 
|------------------------------ | ------ |  | ------------------------------------------------------------------------------------- | -- |  | ----------------------------------------------------------------------------------------------------- |  |  | - | -------- |  | 
|                               |        |  |                                                                                       |    |  |                                                                                                       |  |  |   | Page No.
|                               |        |  |                                                                                       |    |  |                                                                                                       |  |  |   |         
|PART I - Financial Information |        |  |                                                                                       |   
|                              
|                              
|                              
|                              
|                               | Item 1 |  | Condensed Balance Sheet (Unaudited)
        September 30, 2002                        |    |  | 2                                                                                                     | 
|                              
|                              
|                              
|                              
|                               |        |  |                                                                                       |    |  | Condensed Statements of Operations (Unaudited)Three and Nine Months Ended September 30, 2002 and 2001 |  |  | 3 |         
|                              
|                              
|                              
|                              
|                               |        |  |                                                                                       |    |  | Condensed Statement of Shareholders' Equity (Unaudited)Nine Months Ended September 30, 2002           |  |  | 4 |         
|                              
|                              
|                              
|                              
|                               |        |  |                                                                                       |    |  | Condensed Statements of Cash Flows (Unaudited)Nine Months Ended September 30, 2002 and 2001           |  |  | 5 |         
|                              
|                              
|                              
|                              
|                               |        |  |                                                                                       |    |  | Notes to Unaudited Financial Statements                                                               |  |  | 6 |         
|                              
|                              
|                              
|                              
|                               | Item 2 |  | Management's Discussion and Analysis of Financial Condition and Results of Operations |    |  | 9                                                                                                     | 
|                              
|                              
|                              
|                              
|                               | Item 3 |  | Controls and Procedures                                                               |    |  | 13                                                                                                    | 
|                              
|                              
|                              
|                              
|PART II - Other Information   
|                              
|                              
|                              
|                              
|                               | Item 1 |  | Legal Proceedings                                                                     |    |  | 14                                                                                                    | 
|                              
|                              
|                              
|                              
|                               | Item 2 |  | Changes in Securities                                                                 |    |  | 14                                                                                                    | 
|                              
|                              
|                              
|                              
|                               | Item 3 |  | Defaults upon Senior Securities                                                       |    |  | 14                                                                                                    | 
|                              
|                              
|                              
|                              
|                               | Item 4 |  | Submission of Matters to a Vote of Security Holders                                   |    |  | 14                                                                                                    | 
|                              
|                              
|                              
|                              
|                               | Item 5 |  | Other Information                                                                     |    |  | 14                                                                                                    | 
|                              
|                              
|                              
|                              
|                               | Item 6 |  | Exhibits and Reports on Form 8K                                                       |    |  | 14                                                                                                    | 
|                              
|                              
|                              
|                              
|SIGNATURES                     |        |  |                                                                                       | 15 | 
|                              
|                              
|                              
|                              
|CERTIFICATION                  |        |  |                                                                                       | 16 | 





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PLANET POLYMER TECHNOLOGIES, INC.

CONDENSED BALANCE SHEET (UNAUDITED)



---



|                                                                   |                                                                                                              |                                            |         |               |         | 
|------------------------------------------------------------------ | ------------------------------------------------------------------------------------------------------------ | ------------------------------------------ | ------- | ------------- | ------- | 
|                                                                   |                                                                                                              |                                            |         | September 30,
|                                                                   |                                                                                                              |                                            |         | 2002         
|                                                                   |                                                                                                              |                                            |         |              
|ASSETS                                                             |                                                                                                              |                                            |         |              
|Current assets:                                                    |                                                                                                              |                                            |         |              
|                                                                   | Cash                                                                                                         |                                            | $       | 51,253        |        
|                                                                   | Accounts receivable                                                                                          |                                            |         | 41,274        |        
|                                                                   | Note receivable                                                                                              |                                            |         | 70,039        |        
|                                                                   | Prepaid expenses and other current assets                                                                    |                                            |         | 8,128         |        
|                                                                   |                                                                                                              |                                            |         |              
|                                                                   |                                                                                                              | Total current assets                       |         |               | 170,694 | 
|Property and equipment, net of accumulated depreciation of $74,349 |                                                                                                              |                                            | 10,543  |              
|Patents and trademarks, net of accumulated amortization of $59,548 |                                                                                                              |                                            | 171,788 |              
|Other assets                                                       |                                                                                                              |                                            | 6,604   |              
|                                                                   |                                                                                                              |                                            |         |              
|                                                                   |                                                                                                              | Total assets                               |         | $             | 359,629 | 
|                                                                   |                                                                                                              |                                            |         |              
|LIABILITIES AND SHAREHOLDERS EQUITY                               |                                                                                                              |                                            |         |              
|Current liabilities:                                               |                                                                                                              |                                            |         |              
|                                                                   | Accounts payable                                                                                             |                                            | $       | 7,285         |        
|                                                                   | Accrued payroll and vacation                                                                                 |                                            |         | 16,204        |        
|                                                                   | Accrued expenses                                                                                             |                                            |         | 20,658        |        
|                                                                   | Capital lease obligations                                                                                    |                                            |         | 551           |        
|                                                                   |                                                                                                              |                                            |         |              
|                                                                   |                                                                                                              | Total liabilities                          |         |               | 44,698  | 
|                                                                   |                                                                                                              |                                            |         |              
|Shareholders equity:                                              |                                                                                                              |                                            |         |              
|                                                                   | Preferred Stock, no par value
4,250,000 shares authorized
No shares issued or outstanding                    |                                            |         |              |        
|                                                                   | Series A Convertible Preferred Stock, no par value
750,000 shares authorized
No shares issued or outstanding |                                            |         |              |        
|                                                                   | Common Stock, no par value
20,000,000 shares authorized
9,207,884 shares issued and outstanding              |                                            |         | 14,582,123    |        
|                                                                   | Accumulated deficit                                                                                          |                                            |         | (14,267,192   | )      
|                                                                   |                                                                                                              |                                            |         |              
|                                                                   |                                                                                                              | Total shareholders equity                 |         |               | 314,931 | 
|                                                                   |                                                                                                              |                                            |         |              
|                                                                   |                                                                                                              | Total liabilities and shareholders equity |         | $             | 359,629 | 
|                                                                   |                                                                                                              |                                            |         |              

The accompanying notes are an integral part of the financial statements.

2



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PLANET POLYMER TECHNOLOGIES, INC.

CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)



---



|                            |                                |                                                                          |        |                                  |           |                                 |         |         |           |      |         |         |           |   |         |         |            |  
|--------------------------- | ------------------------------ | ------------------------------------------------------------------------ | ------ | -------------------------------- | --------- | ------------------------------- | ------- | ------- | --------- | ---- | ------- | ------- | --------- | - | ------- | ------- | ---------- | -
|                            |                                |                                                                          |        | THREE MONTHS ENDED SEPTEMBER 30, |           | NINE MONTHS ENDED SEPTEMBER 30,
|                            |                                |                                                                          |        |                                  |           |                                
|                            |                                |                                                                          |        | 2002                             |           | 2001                            |         | 2002    |           | 2001
|                            |                                |                                                                          |        |                                  |           |                                 |         |         |           |     
|Revenues                    |                                | $                                                                        | 63,879 |                                  |           | $                               | 152,955 |         |           | $    | 141,648 |         |           | $ | 312,892 |        
|                            |                                |                                                                          |        |                                  |           |                                 |         |         |           |      |         |         |           |   |         |        
|Operating expenses:         |                                |                                                                          |        |                                  |           |                                 |         |         |           |      |         |         |           |   |         |        
|                            | Cost of revenues               |                                                                          |        | 46,798                           |           |                                 |         | 108,234 |           |      |         | 102,258 |           |   |         | 249,026 |           
|                            | General and administrative     |                                                                          |        | 147,993                          |           |                                 |         | 188,656 |           |      |         | 335,002 |           |   |         | 622,906 |           
|                            | Marketing                      |                                                                          |        | 33,461                           |           |                                 |         | 50,702  |           |      |         | 83,014  |           |   |         | 189,123 |           
|                            | Research and development       |                                                                          |        | 22,687                           |           |                                 |         | 54,641  |           |      |         | 107,642 |           |   |         | 283,392 |           
|                            | Loss from impairment of assets |                                                                          |        |                                 |           |                                 |         |        |           |      |         | 62,159  |           |   |         |        |           
|                            |                                |                                                                          |        |                                  |           |                                 |         |         |           |      |         |         |           |   |         |        
|                            |                                | Total operating expenses                                                 |        |                                  | 250,939   |                                 |         |         | 402,233   |      |         |         | 690,075   |   |         |         | 1,344,447  |  
|                            |                                |                                                                          |        |                                  |           |                                 |         |         |           |      |         |         |           |   |         |        
|                            |                                | Loss from operations                                                     |        |                                  | (187,060  | )                               |         |         | (249,278  | )    |         |         | (548,427  | ) |         |         | (1,031,555 | )
|Other income (expense), net |                                |                                                                          | 4,894  |                                  |           |                                 | (3,202  | )       |           |      | 25,509  |         |           |   | 16,230  |        
|                            |                                |                                                                          |        |                                  |           |                                 |         |         |           |      |         |         |           |   |         |        
|                            |                                | Net loss                                                                 |        |                                  | (182,166  | )                               |         |         | (252,480  | )    |         |         | (522,918  | ) |         |         | (1,015,325 | )
|                            |                                | Preferred Stock dividends                                                |        |                                  |          |                                 |         |         |          |      |         |         |          |   |         |         | (10,450    | )
|                            |                                |                                                                          |        |                                  |           |                                 |         |         |           |      |         |         |           |   |         |        
|                            |                                | Net loss applicable to common shareholders                               |        | $                                | (182,166  | )                               |         | $       | (252,480  | )    |         | $       | (522,918  | ) |         | $       | (1,025,775 | )
|                            |                                |                                                                          |        |                                  |           |                                 |         |         |           |      |         |         |           |   |         |        
|                            |                                | Net loss per share applicable to common shareholders (basic and diluted) |        | $                                | (0.02     | )                               |         | $       | (0.03     | )    |         | $       | (0.06     | ) |         | $       | (0.11      | )
|                            |                                |                                                                          |        |                                  |           |                                 |         |         |           |      |         |         |           |   |         |        
|                            |                                | Shares used in per share computations                                    |        |                                  | 9,207,884 |                                 |         |         | 9,237,618 |      |         |         | 9,182,312 |   |         |         | 9,021,367  |  
|                            |                                |                                                                          |        |                                  |           |                                 |         |         |           |      |         |         |           |   |         |        

The accompanying notes are an integral part of the financial statements.

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PLANET POLYMER TECHNOLOGIES, INC.

CONDENSED STATEMENT OF SHAREHOLDERS EQUITY (UNAUDITED)



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|                                      |  |              |           |             |  |         |            |       |  |   |             |   |  |   |          |  
|------------------------------------- |  | ------------ | --------- | ----------- |  | ------- | ---------- | ----- |  | - | ----------- | - |  | - | -------- | -
|                                      |  | Common Stock |           |             |  |         |            |       |  |  
|                                      |  |              |           | Accumulated |  |         |            |      
|                                      |  | Shares       |           | Amount      |  | Deficit |            | Total
|                                      |  |              |           |             |  |         |            |      
|Balance at January 1, 2002            |  |              | 9,165,618 |             |  | $       | 14,575,783 |       |  | $ | (13,744,274 | ) |  | $ | 831,509  |  
|Issuance of Common Stock for services |  |              | 42,266    |             |  |         | 6,340      |       |  |   |            |   |  |   | 6,340    |  
|Net loss                              |  |              |          |             |  |         |           |       |  |   | (522,918    | ) |  |   | (522,918 | )
|                                      |  |              |           |             |  |         |            |       |  |   |             |   |  |   |          |  
|Balance at September 30, 2002         |  |              | 9,207,884 |             |  | $       | 14,582,123 |       |  | $ | (14,267,192 | ) |  | $ | 314,931  |  
|                                      |  |              |           |             |  |         |            |       |  |   |             |   |  |   |          |  

The accompanying notes are an integral part of the financial statements.

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PLANET POLYMER TECHNOLOGIES, INC.




CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)



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|                                              |                                                                                   |                                            |                                                  |          |                                 |          |           |            |         |          |  
|--------------------------------------------- | --------------------------------------------------------------------------------- | ------------------------------------------ | ------------------------------------------------ | -------- | ------------------------------- | -------- | --------- | ---------- | ------- | -------- | -
|                                              |                                                                                   |                                            |                                                  |          | Nine months ended September 30,
|                                              |                                                                                   |                                            |                                                  |          |                                
|                                              |                                                                                   |                                            |                                                  |          | 2002                            |          | 2001     
|                                              |                                                                                   |                                            |                                                  |          |                                 |          |          
|Cash flows from operating activities:         |                                                                                   |                                            |                                                  |          |                                 |          |           |           
|                                              | Net loss                                                                          |                                            | $                                                | (522,918 | )                               |          | $         | (1,015,325 | )      
|                                              | Adjustments to reconcile net loss to net cash used
by operating activities:       |                                            |                                                  |          |                                 |          |           |            |        
|                                              |                                                                                   | Depreciation and amortization              |                                                  |          | 22,209                          |          |           |            | 64,811  |         
|                                              |                                                                                   | Bad debts                                  |                                                  |          | 80,000                          |          |           |            |        |         
|                                              |                                                                                   | Loss from impairment of intangible assets  |                                                  |          | 62,159                          |          |           |            |        |         
|                                              |                                                                                   | Gain on disposal of property and equipment |                                                  |          | (13,500                         | )        |           |            | (25     | )       
|                                              |                                                                                   | Issuance of Common Stock for services      |                                                  |          | 6,340                           |          |           |            | 6,300   |         
|                                              | Changes in operating assets and liabilities:                                      |                                            |                                                  |          |                                 |          |           |            |        
|                                              |                                                                                   | Accounts receivable                        |                                                  |          | 78,162                          |          |           |            | 22,177  |         
|                                              |                                                                                   | Inventories                                |                                                  |          |                                |          |           |            | 14,419  |         
|                                              |                                                                                   | Prepaid expenses and other assets          |                                                  |          | 49,702                          |          |           |            | 2,037   |         
|                                              |                                                                                   | Accounts payable                           |                                                  |          | (33,632                         | )        |           |            | 83,232  |         
|                                              |                                                                                   | Accrued expenses                           |                                                  |          | (55,404                         | )        |           |            | (70,931 | )       
|                                              |                                                                                   |                                            |                                                  |          |                                 |          |           |           
|                                              |                                                                                   |                                            | Net cash used by operating activities            |          |                                 | (326,882 | )         |            |         | (893,305 | )
|                                              |                                                                                   |                                            |                                                  |          |                                 |          |           |           
|Cash flows from investing activities:         |                                                                                   |                                            |                                                  |          |                                 |          |           |           
|                                              | Purchases of property and equipment                                               |                                            |                                                  |         |                                 |          |           | (19,947    | )      
|                                              | Proceeds from sale of property and equipment                                      |                                            |                                                  | 13,500   |                                 |          |           | 25         |        
|                                              | Cost of patents and other assets                                                  |                                            |                                                  |         |                                 |          |           | (5,112     | )      
|                                              | Payments from note receivable                                                     |                                            |                                                  | 112,831  |                                 |          |           | 93,783     |        
|                                              |                                                                                   |                                            |                                                  |          |                                 |          |           |           
|                                              |                                                                                   |                                            | Net cash provided by investing activities        |          |                                 | 126,331  |           |            |         | 68,749   |  
|                                              |                                                                                   |                                            |                                                  |          |                                 |          |           |           
|Cash flows from financing activities:         |                                                                                   |                                            |                                                  |          |                                 |          |           |           
|                                              | Proceeds from issuance of Common Stock and exercise of warrants
and stock options |                                            |                                                  |         |                                 |          |           | 40,801     |        
|                                              | Principal payments on capital lease obligations                                   |                                            |                                                  | (39,675  | )                               |          |           | (8,950     | )      
|                                              |                                                                                   |                                            |                                                  |          |                                 |          |           |           
|                                              |                                                                                   |                                            | Net cash provided (used) by financing activities |          |                                 | (39,675  | )         |            |         | 31,851   |  
|                                              |                                                                                   |                                            |                                                  |          |                                 |          |           |           
|                                              |                                                                                   |                                            | Net decrease in cash                             |          |                                 | (240,226 | )         |            |         | (792,705 | )
|Cash at beginning of period                   |                                                                                   |                                            | 291,479                                          |          |                                 |          | 1,088,567 |           
|                                              |                                                                                   |                                            |                                                  |          |                                 |          |           |           
|Cash at end of period                         |                                                                                   | $                                          | 51,253                                           |          |                                 | $        | 295,862   |           
|                                              |                                                                                   |                                            |                                                  |          |                                 |          |           |           
|Supplemental disclosure of non-cash activity: |                                                                                   |                                            |                                                  |          |                                 |          |           |           
|                                              | Issuance of Common Stock dividends on Preferred Stock                             |                                            | $                                                |         |                                 |          | $         | 10,450     |        
|                                              | Issuance of Common Stock for services                                             |                                            |                                                  | 6,340    |                                 |          |           | 6,300      |        
|                                              | Conversion of Series A Preferred Stock into Common Stock                          |                                            |                                                  |         |                                 |          |           | 517,251    |        
|                                              | Insurance purchased under a short-term financing agreement                        |                                            |                                                  |         |                                 |          |           | 44,134     |        

The accompanying notes are an integral part of the financial statements.

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Planet Polymer Technologies, Inc.

NOTES TO UNAUDITED FINANCIAL STATEMENTS

1. Basis of Presentation

The accompanying unaudited financial statements of Planet Polymer
Technologies, Inc. (Planet or the Company) have been prepared in accordance
with the interim reporting requirements of Form 10-QSB, pursuant to the rules
and regulations of the Securities and Exchange Commission. However, they do
not include all of the information and footnotes required by accounting
principles generally accepted in the United States for complete financial
statements.

In managements opinion, all adjustments (consisting of only normal
recurring adjustments) considered necessary for a fair presentation have been
included. Operating results for the nine months ended September 30, 2002 are
not necessarily indicative of results that may be expected for the year ending
December 31, 2002. For additional information, refer to the Companys
consolidated financial statements and notes thereto for the year ended December
31, 2001 contained in the Companys Annual Report on Form 10-KSB for the fiscal
year ended December 31, 2001.

Certain reclassifications have been made to the interim financial
statements of the prior year to conform to the presentation of the current
interim periods. These reclassifications had no effect on previously reported
results of operations or retained earnings.

2. Liquidity and Capital Resources

The accompanying financial statements have been prepared on a going
concern basis, which contemplates the realization of assets and satisfaction of
liabilities in the ordinary course of business, and not on a liquidation basis.
The Company has incurred losses since inception. For the nine months ended
September 30, 2002 and 2001, the Company had net losses of approximately
$523,000 and $1,015,000, respectively. As of September 30, 2002, the Company
had an accumulated deficit of approximately $14,267,000. In August 2002, the
purchaser of certain assets defaulted on certain payments and in October 2002 a
major licencee filed for reorganization under the bankruptcy code (see note 6).
These matters raise substantial doubt about the ability of the Company to
continue as a going concern. The Company has reduced staff and operating
expenses, reduced or sold non-Agway or agricultural assets, while continuing to
provide technical research and development for Agways FreshSeal commercial
program and Optigen development activities, as well as support of MIM asset
utilization at Ryer Industries. However, management cannot provide any
assurance that the Company will be successful in satisfying future working
capital and other cash requirements past December 31, 2002. As a result, the
Company may have to cease its operations and liquidate its assets and
liabilities and prepare its financial statements on a liquidation basis. The
accompanying financial statements do not include any adjustments that might
result for this uncertainty. The Companys future capital requirements will be
dependent upon many factors, including, but not limited to, costs associated
with the continued research and development of the Companys proprietary
polymer materials, costs associated with the filing and enforcement of the
Companys patents, costs associated with manufacturing scale-up and market
acceptance, and the timing thereof, of the Companys products.

3. Long-Lived Assets

The Company assesses potential impairments to its long-lived assets when
there is evidence that events or changes in circumstances have made recovery of
the assets carrying value unlikely. An impairment loss would be recognized
when the sum of the expected future net cash flows is less than the carrying
amount of the asset. For similar assets held for sale, an impairment loss is
recognized when the carrying amount exceeds its net realizable value or fair
value less cost to sell. In June 2002, the Company recorded approximately
$62,000 relating to the write-off of certain intangible assets when it was
determined that net realizable value or fair value

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Planet Polymer Technologies, Inc.
NOTES TO UNAUDITED FINANCIAL STATEMENTS  (Continued)

less cost to sell these assets were insufficient to recover their carrying
value. The impaired assets principally represent the Companys EnviroPlastic®
Z technology.

4. Earnings (Loss) Per Share

Earnings (loss) per share is computed using the weighted average number of
shares of common stock outstanding and is presented for basic and diluted
earnings (loss) per share. Basic earnings (loss) per share is computed by
dividing income (loss) available to common shareholders by the weighted average
number of common shares outstanding for the period. Diluted earnings per share
is computed by dividing income available to common shareholders by the weighted
average number of common shares outstanding during the period increased to
include, if dilutive, the number of additional common shares that would have
been outstanding if the potential common shares had been issued. Dilutive
potential common shares consist of the incremental common shares issuable upon
conversion of convertible preferred stock (using the if converted method) and
exercise of stock options and warrants (using the treasury stock method) for
all periods.

The Company has excluded all convertible preferred stock and outstanding
stock options and warrants from the calculation of diluted loss per share for
the three and nine months ended September 30, 2001 and 2002 because all such
securities are anti-dilutive for those periods. Accordingly, diluted loss per
share equals basic loss per share. The total number of potential common shares
excluded from the calculation of diluted loss per share for the three and nine
months ended September 30, 2002 was 1,208,650 and 1,208,650, respectively.

5. Income Taxes

As the ultimate realization of the potential benefits of the Companys net
operating loss carryforwards is considered unlikely by management, the Company
has offset the deferred tax assets attributable to those potential benefits
through valuation allowances and, accordingly, the Company did not recognize
any credits for income taxes in the accompanying condensed statements of
operations to offset its pre-tax losses.

6. Subsequent Events

On December 28, 2001, the Company sold certain assets of the Company
relating to its Metal Injection Molding (MIM) business, including
intellectual property, technology, manufacturing equipment and raw material and
finished goods to Ryer Industries LLC (Ryer). In consideration of these
assets, Ryer had agreed to pay to the Company cash in the amount of $328,157,
plus a royalty of 6% on sales of custom feedstocks sold during the period
January 1, 2002 and December 31, 2009. Additionally, Ryer had agreed to pay
the Company a royalty on all tungsten carbide feedstock sales in the amount of
$2.50 per net pound during the period July 1, 2002 and June 30, 2010. Ryer and
the Company also entered into a Consulting Agreement for consulting services
related to the business and technology sold to Ryer.

Through October 31, 2002, the Company had received $178,157. In August
2002, Ryer defaulted on its required payments. The Company has continued to
accrue interest on the notes; during the three months ended September 30, 2002,
$3,803 of interest income was accrued but not collected. At September 30,
2002, the present value of the remaining amounts due was $143,539, discounted
at 10%. Management has determined it reasonable to make a provision for loss
of $73,500 against these notes. This loss provision is included in general and
administrative expenses in the Condensed Statements of Operations. In October
2002, the Company and Ryer entered into a Forbearance Agreement which modified
the payment schedule for the remaining obligations to the Company with payments
to begin in December 2002, and continue through April 2003. Royalty payments
associated with sales from these technologies were deferred and are scheduled
to resume in December 2002. The
Company remains in dispute with Ryer over how certain royalties are
calculated and paid, but has agreed to stay

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Planet Polymer Technologies, Inc.
NOTES TO UNAUDITED FINANCIAL STATEMENTS  (Continued)

resolution of that dispute until
other deferred payments are made or Ryer defaults. If Ryer defaults, the
Company will seek to enforce the Confession Judgment given by Ryer to the
Company in connection with the Forbearance Agreement, which provides among
other things, for turnover to the Company of the assets sold by the Company to
Ryer.

In November 1998, the Company granted Agway an exclusive worldwide license
in connection with the Companys technology for time-release coatings for a
variety of agricultural and food products (the License Agreement). The
License Agreement outlines the general terms and conditions for the rights
granted Agway thereunder. The Company and Agway agreed to execute further
sub-agreements specifying the royalties to be paid to the Company for Agways
use of the Companys technology with certain products. In March 2000, the
Company and Agway entered into a Sub-Agreement with respect to Planets
patented/patent pending coatings and/or polymer systems sold for use on fruits,
vegetables, floral and nursery items. During 2001, the Company received a
$100,000 minimum royalty payment from Agway in order to maintain exclusivity.
On October 1, 2002, Agway, Inc., filed a voluntary petition for reorganization
under Chapter 11 of the United States Bankruptcy Code. The Sub Agreement
provided for an additional minimum royalty of $300,000 on or before October 31,
2002 to maintain exclusivity. This payment has not been received or accrued by
Planet. Pursuant to the Sub Agreement, Planet notified Agway that the payment
was not received. Under the terms of the Sub Agreement, Agway has sixty (60)
days during which Agway may make the necessary payment and retain market
exclusivity for this technology. Failure by Agway to make payment prior to the
end of this period will permit Planet to issue additional non-exclusive
licenses for this technology to other interested parties in the fruit,
vegetable, nuts and flowers segments of the agricultural products industry.
Management cannot assure that the Company will be able to obtain any new
agreements that would generate comparable revenues.

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PART I  FINANCIAL INFORMATION
Item 2  Managements Discussion and Analysis of Financial
Condition and Results of Operations

Planet Polymer Technologies, Inc.

Except for the historical information contained herein, the discussion in this
report contains forward- looking statements that involve certain risks and
uncertainties. The Companys actual results could differ materially from those
discussed in this report. Factors that could cause or contribute to such
differences include, but are not limited to, those discussed below and in the
Companys Form 10-KSB for the fiscal year ended December 31, 2001.

OVERVIEW

Since Planet Polymer Technologies, Inc. (Planet or the Company) was
founded in 1991 substantially all of the Companys resources have been devoted
to the development and commercialization of its technologies and products.
This has included the expenditure of funds to develop the Companys corporate
infrastructure, support the Companys marketing efforts and establish a pilot
production facility, in addition to research and development.

Planet has incurred operating losses since inception and had an
accumulated deficit as of September 30, 2002 of approximately $14.3 million.
Pending commercial deployment of and related volume orders for the Companys
products, the Company expects to incur additional losses.

RESULTS OF OPERATIONS

On December 28, 2001, the Company sold certain assets of the Company
relating to its Metal Injection Molding (MIM) business, including
intellectual property, technology, manufacturing equipment and raw material and
finished goods to Ryer Industries LLC (Ryer).

The Companys revenues decreased to approximately $64,000 for the three
months ended September 30, 2002 from approximately $153,000 for the same period
in 2001 and to approximately $142,000 for the nine months ended September 30,
2002 from approximately $313,000 for the same period in 2001. These decreases
were primarily attributable to no AQUAMIM® sales, resulting from selling all
AQUAMIM® assets in December 2001 and no EnviroPlastic® Z sales partially offset
by higher Agway development income, revenue from research and development
technical consulting and approximately $10,000 and $2,000 in royalties paid by
Ryer in the third and second quarters of 2002, respectively. Ryer has
defaulted on required payments and Agway has filed for reorganization under the
bankruptcy code. As a result, revenues associated with these activities may
decrease.

Cost of revenues decreased to approximately $47,000 for the three months
ended September 30, 2002 from approximately $108,000 for the same period in
2001 and to approximately $102,000 for the nine months ended September 30, 2002
from approximately $249,000 for the same period in 2001. These decreases were
primarily due to decreased revenues and a change in product mix away from
AQUAMIM® and EnviroPlastic® Z.

General and administrative expenses decreased to approximately $148,000
for the three months ended September 30, 2002 from approximately $189,000 for
the same period in 2001 and to approximately $335,000 for the nine months ended
September 30, 2002 from approximately $623,000 for the same period in 2001.
These decreases were primarily attributable to a reduction in staff, reduced
use of outside services, and lower depreciation and amortization expense
resulting from selling all
AQUAMIM®

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Item 2  Managements Discussion and Analysis of Financial
Condition and Results of Operations  (Continued)

Planet Polymer Technologies, Inc.

assets in December 2001 partially offset by bad debt allowances
of $80,000 recorded as described in note 6.

Marketing expenses decreased to approximately $33,000 for the three months
ended September 30, 2002 from approximately $51,000 for the same period in 2001
and to approximately $83,000 for the nine months ended September 30, 2002 from
approximately $189,000 for the same period in 2001. These decreases were
primarily due to a reduction in staff and reduced promotional expenses.

Research and development expenses decreased to approximately $23,000 for
the three months ended September 30, 2002 from approximately $55,000 for the
same period in 2001 and to approximately $108,000 for the nine months ended
September 30, 2002 from approximately $283,000 for the same period in 2001.
These decreases were primarily due to a reduction in staff, severance costs
related to employee terminations in the first half of 2001, greater research
and development expense reimbursement from Agway and lower depreciation and
amortization expense resulting from selling all AQUAMIM® assets in December
2001.

In June 2002, the Company recorded a charge of approximately $62,000
relating to the write-off of certain EnviroPlastic Z intangible assets held for
sale when it was determined that future undiscounted cash flows associated with
these assets were insufficient to recover their carrying value. The assets
principally represent the Companys historical ownership interest in product
rights and license agreements relating to the Companys EnviroPlastic Z patent.

Other income (expense), net increased to approximately $5,000 for the
three months ended September 30, 2002 from a net expense of approximately
$3,000 for the same period in 2001 and increased to approximately $26,000 for
the nine months ended September 30, 2002 from approximately $16,000 for the
same period in 2001. These increases were primarily attributable to a gain on
the sale of fixed assets and securities partially offset by lower cash balances
and lower interest rates.

LIQUIDITY AND CAPITAL RESOURCES

The Company used cash of approximately $327,000 for continuing operations
for the nine months ended September 30, 2002. Such funds were used primarily
for research and development activities, marketing efforts and administrative
support.

Net cash provided by investing activities of approximately $126,000 for
the nine months ended September 30, 2002 resulted from the receipt of payments
on a note receivable associated with the sale of MIM assets to Ryer and the
sale of other equipment to unrelated parties.

Net cash used by financing activities was approximately $40,000 for the
nine months ended September 30, 2002. Such funds were used for payments
associated with capital lease obligations.

The Company does not believe that its existing sources of liquidity and
anticipated revenue will satisfy the Companys projected working capital and
other cash requirements through June 30, 2003. The Company expects that it
will need to raise or generate substantial additional capital to accomplish its
business plan over the next year. The Company has reduced staff and operating
expenses, reduced or sold non-Agway or agricultural assets, while continuing to
provide technical research and development for Agways FreshSeal commercial
program and Optigen development activities, as well as support of
MIM asset utilization at Ryer Industries. Agway has filed for
reorganization and Ryer has defaulted on certain

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Item 2  Managements Discussion and Analysis of Financial
Condition and Results of Operations  (Continued)

Planet Polymer Technologies, Inc.

payments. Accordingly,
management cannot provide any assurance that the Company will be successful in
satisfying future working capital and other cash requirements past December 31,
2002. If it cannot, the Company may have to cease operations and liquidate its
assets and liabilities and prepare its financial statements on a liquidation
basis instead of a going concern basis. The Companys future capital
requirements will be dependent upon many factors, including, but not limited
to, costs associated with the continued research and development of the
Companys proprietary polymer materials, costs associated with the filing and
enforcement of the Companys patents, costs associated with manufacturing
scale-up and market acceptance, and the timing thereof, of the Companys
products. There can be no assurance that the Company will be able to generate
positive cash flows or profitability in the future.

On December 28, 2001, the Company sold certain assets of the Company
relating to its Metal Injection Molding (MIM) business, including
intellectual property, technology, manufacturing equipment and raw material and
finished goods to Ryer Industries LLC (Ryer). In consideration of these
assets, Ryer had agreed to pay to the Company cash in the amount of $328,157,
plus a royalty of 6% on sales of custom feedstocks sold during the period
January 1, 2002 and December 31, 2009. Additionally, Ryer had agreed to pay
the Company a royalty on all tungsten carbide feedstock sales in the amount of
$2.50 per net pound during the period July 1, 2002 and June 30, 2010. Ryer and
the Company also entered into a Consulting Agreement for consulting services
related to the business and technology sold to Ryer.

Through October 31, 2002, the Company had received $178,157. In August
2002, Ryer defaulted on its required payments. The Company has continued to
accrue interest on the notes; during the three months ended September 30, 2002,
$3,803 of interest income was accrued but not collected. At September 30,
2002, the present value of the remaining amounts due was $143,539, discounted
at 10%. Management has determined it reasonable to make a provision for loss
of $73,500 against these notes. This loss provision is included in general and
administrative expenses in the Condensed Statements of Operations. In October
2002, the Company and Ryer entered into a Forbearance Agreement which modified
the payment schedule for the remaining obligations to the Company with payments
to begin in December 2002, and continue through April 2003. Royalty payments
associated with sales from these technologies were deferred and are scheduled
to resume in December 2002. The Company remains in dispute with Ryer over how
certain royalties are calculated and paid, but has agreed to stay resolution of
that dispute until other deferred payments are made or Ryer defaults. If Ryer
defaults, the Company will seek to enforce the Confession Judgment given by
Ryer to the Company in connection with the Forbearance Agreement, which
provides among other things, for turnover to the Company of the assets sold by
the Company to Ryer.

In November 1998, the Company granted Agway an exclusive worldwide license
in connection with the Companys technology for time-release coatings for a
variety of agricultural and food products (the License Agreement). The
License Agreement outlines the general terms and conditions for the rights
granted Agway thereunder. The Company and Agway agreed to execute further
sub-agreements specifying the royalties to be paid to the Company for Agways
use of the Companys technology with certain products. In March 2000, the
Company and Agway entered into a Sub-Agreement with respect to Planets
patented/patent pending coatings and/or polymer systems sold for use on fruits,
vegetables, floral and nursery items. During 2001, the Company received a
$100,000 minimum royalty payment from Agway in order to maintain exclusivity.
On October 1, 2002, Agway, Inc., filed a voluntary petition for reorganization
under Chapter 11 of the United States Bankruptcy Code. The Sub Agreement
provided
for an additional minimum royalty of $300,000 on or before October 31,
2002 to maintain exclusivity. This payment has not been received or accrued by
Planet. Pursuant to the Sub Agreement, Planet notified

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Item 2  Managements Discussion and Analysis of Financial
Condition and Results of Operations  (Continued)

Planet Polymer Technologies, Inc.

Agway that the payment
was not received. Under the terms of the Sub Agreement, Agway has sixty (60)
days during which Agway may make the necessary payment and retain market
exclusivity for this technology. Failure by Agway to make payment prior to the
end of this period will permit Planet to issue additional non-exclusive
licenses for this technology to other interested parties in the fruit,
vegetable, nuts and flowers segments of the agricultural products industry.
Management cannot assure that the Company will be able to obtain any new
agreements that would generate comparable revenues.

On July 18, 2001, the Companys Common Stock was delisted from the Nasdaq
Small Cap Stock Market due to non-compliance with Nasdaqs net tangible assets
and minimum bid pricing requirements. There can be no assurance that the
Companys efforts will result in additional funds or that additional financing
will be available on acceptable terms, or at all.

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Item 3  Controls and Procedures

Planet Polymer Technologies, Inc.

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

We maintain disclosure controls and procedures designed to provide
reasonable assurance that information required to be disclosed in the reports
we file with the SEC is recorded, processed, summarized and reported within the
time periods specified in the rules of the SEC. Within 90 days prior to the
filing of this Quarterly Report on Form 10-QSB, we carried out an evaluation,
under the supervision and the participation of our management, including our
Chief Executive Officer and Chief Financial Officer, of the design and
operation of these disclosure controls and procedures pursuant to Exchange Act
Rule 13a-14. Based upon that evaluation, our Chief Executive Officer and Chief
Financial Officer concluded that our disclosure controls and procedures are
effective in timely alerting him to material information relating to the
Company required to be included in our periodic SEC filings.

CHANGES IN INTERNAL CONTROLS

There were no significant changes in internal controls or other factors
that could significantly affect our internal controls subsequent to the date of
our evaluation.

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##### Table of Contents






PART II  OTHER INFORMATION

Planet Polymer Technologies, Inc.




Item 1  Legal Proceedings

None




Item 2  Changes in Securities

None




Item 3  Defaults upon Senior Securities

None




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

None




Item 5  Other Information

Peter J. ONeill resigned from the Board of Directors of Planet Polymer
Technologies, Inc. effective October 1, 2002.




Item 6  Exhibits and Reports on Form 8-K

(a)  Exhibits:

|               |  |                                                                                                                              
|-------------- |  | -----------------------------------------------------------------------------------------------------------------------------
|Exhibit Number |  | Description                                                                                                                  
|               |  |                                                                                                                              
|10.36          |  | Forbearance and Stipulated Confession of
Judgment Agreement between Planet Polymer Technologies, Inc.
and Ryer Industries LLC
|99.1           |  | CEO and CFO certification                                                                                                    



| | (b) |  | Reports on Form 8-K:
| | --- |  | --------------------
|
| |     |  | None                

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Planet Polymer Technologies, Inc.




SIGNATURES

In accordance with the requirements of the Securities and Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.



|Date: November 14, 2002 | Planet Polymer Technologies, Inc.
|----------------------- | ---------------------------------



| | /s/ Richard C. Bernier
Richard C. Bernier
Chief Executive Officer
(On behalf of Registrant and as Registrants
Principal Financial and Accounting Officer)
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------

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SECTION 302 CERTIFICATION

I, Richard C. Bernier, certify that:

1. I have reviewed this quarterly report on Form 10-QSB of Planet Polymer
Technologies, Inc.;

2. Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this
quarterly report;

3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4. I am responsible for establishing and maintaining disclosure controls
and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the
registrant and we have:

a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this quarterly report is being prepared;

b) evaluated the effectiveness of the registrants disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the Evaluation Date); and

c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our evaluation
as of the Evaluation Date;

5. I have disclosed, based on our most recent evaluation, to the
registrants auditors and the audit committee of registrants board of
directors (or persons performing the equivalent function):

a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrants ability to record,
process, summarize and report financial data and have identified for the
registrants auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrants internal controls;
and

6. I have indicated in this quarterly report whether or not there were
significant changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date of our most
recent evaluation, including any corrective actions with regard to significant
deficiencies and material weaknesses.

/s/ Richard C. Bernier
Richard C. Bernier, Chief Executive Officer

/s/ Richard C. Bernier
Richard C. Bernier, Chief Financial Officer

November 14, 2002

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