--------------------------------------------------------------------------------


                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    FORM 10-Q


           [X] Quarterly Report Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

                  For the quarterly period ended March 31, 2001

          [ ] Transition Report Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

                 For the transition period from ______ to ______

                         Commission file number: 0-20743


                             OPEN PLAN SYSTEMS, INC.
             (Exact name of registrant as specified in its charter)


               Virginia                                    54-1515256
    (State or other jurisdiction of            (IRS Employer Identification No.)
    incorporation or organization)

         4299 Carolina Avenue,                               23222
    Building C, Richmond, Virginia                        (Zip Code)
(Address of principal executive office)

                                 (804) 228-5600
                        (Telephone number of registrant)


     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 .

     As of the close of business on June 14, 2001,  Open Plan Systems,  Inc. had
4,337,391 shares of Common Stock, no par value, outstanding.


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<PAGE>


                             OPEN PLAN SYSTEMS, INC.

                                Table of Contents



PART I.     FINANCIAL INFORMATION                                           Page
---------------------------------                                           ----

Item 1.    Financial Statements

           Consolidated Balance Sheets - March 31, 2001 (unaudited)           1
              and December 31, 2000

           Consolidated Statements of Operations - Three months               2
              ended March 31, 2001 and 2000 (unaudited)

           Consolidated Statements of Cash Flows - Three months               3
              ended March 31, 2001 and 2000 (unaudited)

           Notes to Consolidated Financial Statements - March 31, 2001        4

Item 2.    Management's Discussion and Analysis of                            9
           Financial Condition and Results of Operations

Item 3.    Quantitative and Qualitative Disclosures about Market Risk        16


PART II.   OTHER INFORMATION
----------------------------

Item 1.    Legal Proceedings                                                 17

Item 2.    Changes in Securities and Use of Proceeds                         17

Item 3.    Defaults Upon Senior Securities                                   17

Item 4.    Submission of Matters to a Vote of                                17
              Security Holders

Item 5.    Other Information                                                 17

Item 6.    Exhibits and Reports on Form 8-K                                  17


SIGNATURES
----------



<PAGE>

                             OPEN PLAN SYSTEMS, INC.
                                     PART I
                              FINANCIAL INFORMATION
                          Item 1: Financial Statements
                           Consolidated Balance Sheets
                             (amounts in thousands)
<TABLE>
<CAPTION>
                                                                       March 31,       December 31,
                                                                         2001              2000
                                                                  ------------------------------------
                                                                     (unaudited)
<S>                                                                   <C>              <C>
ASSETS
Current assets:
   Cash and cash equivalents                                          $        19      $       244
   Cash and cash equivalents externally restricted under
      bond indenture agreement                                              2,220            2,190
   Accounts receivable, net                                                 6,954            7,834
   Inventories                                                              6,004            6,278
   Prepaids and other                                                         568              458
   Refundable income taxes                                                     62                -
                                                                  ------------------------------------
TOTAL CURRENT ASSETS                                                       15,827           17,004

Property and equipment, net                                                 2,206            2,393
Goodwill, net                                                               3,606            3,664
Other                                                                         236              271
                                                                  ------------------------------------
TOTAL ASSETS                                                          $    21,875      $    23,332
                                                                  ====================================

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
   Current portion of long-term debt                                  $     2,595      $     2,595
   Revolving line of credit                                                 4,476            3,366
   Trade accounts payable                                                   2,813            3,709
   Accrued compensation and related costs                                     460            1,121
   Other                                                                      735              631
   Customer deposits                                                          734              860
                                                                  ------------------------------------
TOTAL CURRENT LIABILITIES                                                  11,813           12,282

Long-term debt                                                                204              227
Other long-term liabilities                                                    62               20
                                                                  ------------------------------------
TOTAL LIABILITIES                                                          12,079           12,529

Shareholders' equity:
   Common stock, no par value:
     Authorized shares - 50,000
     Issued and outstanding shares - 4,337 at 3/31/01                      18,537           18,561
                                   - 4,352 at 12/31/00
   Additional capital                                                         137              137
   Accumulated deficit                                                     (8,821)          (7,840)
   Accumulated other comprehensive income                                       2                4
   Notes receivable from employees for sale of stock                          (59)             (59)
                                                                  ------------------------------------
TOTAL SHAREHOLDERS' EQUITY                                                  9,796           10,803
                                                                  ------------------------------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                            $    21,875      $    23,332
                                                                  ====================================
</TABLE>

See accompanying notes.


                                       1
<PAGE>

                             OPEN PLAN SYSTEMS, INC.

                Consolidated Statements of Operations (Unaudited)
                  (amounts in thousands, except per share data)
<TABLE>
<CAPTION>
                                                                          Three Months ended
                                                                                March 31,
                                                                          2001             2000
                                                                  ------------------------------------

<S>                                                                   <C>              <C>
Net sales                                                             $     9,962      $     9,333
Cost of sales                                                               7,449            6,420
                                                                  ------------------------------------

Gross profit                                                                2,513            2,913


Operating expenses:
   Amortization of intangibles                                                 68               68
   Selling and marketing                                                    2,402            1,927
   General and administrative                                                 910              594
                                                                  ------------------------------------
                                                                            3,380            2,589
                                                                  ------------------------------------
Operating (loss) income                                                      (867)             324


Other (income) expense:
   Interest expense                                                            79               98
   Other, net                                                                  35               (2)
                                                                  ------------------------------------
                                                                              114               96
                                                                  ------------------------------------
(Loss) income before income taxes                                            (981)             228


Income taxes                                                                    -              104
                                                                  ------------------------------------
Net (loss) income                                                     $      (981)     $       124
                                                                  ====================================

Basic and diluted (loss)  income per common share                     $      (.23)     $       .03
                                                                  ====================================
Diluted weighted average common shares
outstanding                                                                 4,339            4,405
                                                                  ====================================
</TABLE>

See accompanying notes.





                                       2
<PAGE>

                             OPEN PLAN SYSTEMS, INC.

                Consolidated Statements of Cash Flows (Unaudited)
                             (amounts in thousands)
<TABLE>
<CAPTION>
                                                                          Three Months ended
                                                                                March 31,
                                                                          2001             2000
                                                                  ------------------------------------
<S>                                                                   <C>              <C>
Operating activities
Net (loss) income                                                     $      (981)     $       124

Adjustments to reconcile net (loss) income to net cash used
   in operating activities:
   Provision for losses on receivables                                         30               29
   Depreciation and amortization                                              300              301
   Deferred income taxes                                                        -              102
   Changes in operating assets and liabilities:
     Accounts receivable                                                      850             (541)
     Inventories                                                              274             (276)
     Prepaids and other                                                      (147)             (88)
     Trade accounts payable                                                  (896)            (162)
     Customer deposits                                                       (126)               1
     Accrued and other liabilities                                           (517)             (71)
                                                                  ------------------------------------
Net cash used in operating activities                                      (1,213)            (581)

Investing activities
Increase in cash and cash equivalents externally restricted
   under bond indenture agreement                                             (30)               -
Purchases of property and equipment                                           (45)            (163)
                                                                  ------------------------------------
Net cash used in investing activities                                         (75)            (163)

Financing activities
Net borrowings on revolving line of credit                                  1,110              826
Purchase of common stock                                                      (24)               -
Principal payments on long-term debt, and capital lease
   obligations                                                                (23)             (16)
                                                                  ------------------------------------
Net cash provided by financing activities                                   1,063              810
                                                                  ------------------------------------

Change in cash and cash equivalents                                          (225)              66

Cash and cash equivalents at beginning of period                              244               13
                                                                  ------------------------------------
Cash and cash equivalents at end of period                            $        19      $        79
                                                                  ====================================

Supplemental disclosures
Interest paid                                                         $       104      $        87
                                                                  ====================================
Income taxes paid                                                     $        79      $        42
                                                                  ====================================
</TABLE>

See accompanying notes.


                                       3
<PAGE>

                             OPEN PLAN SYSTEMS, INC.

             Notes to Consolidated Financial Statements (Unaudited)
                                 March 31, 2001

1. Principles of Presentation

         The accompanying  unaudited  consolidated  financial statements of Open
Plan  Systems,  Inc.  (the  Company)  have  been  prepared  in  accordance  with
accounting  principles  generally  accepted  in the United  States  for  interim
financial  information and with the  instructions to Form 10-Q and Article 10 of
Regulation  S-X.  Accordingly,  they do not include all of the  information  and
footnotes  required by accounting  principles  generally  accepted in the United
States for complete financial statements.  All significant intercompany balances
and transactions are eliminated in consolidation.  In the opinion of management,
the March 31, 2001  financial  statements  reflect all  adjustments  of a normal
recurring nature which the Company considers  necessary for a fair presentation.
The results for the three month period ended March 31, 2001 are not  necessarily
indicative  of the  results  that may be  achieved  for the entire  year  ending
December  31, 2001 or for any other  interim  period.  For further  information,
refer to the consolidated financial statements and footnotes thereto included in
the Company's Form 10-K for the year ended December 31, 2000.

         During the fourth  quarter of the year ended  December  31,  2000,  the
Company  recorded  significant  fourth quarter  adjustments  (see Note 13 to the
Company's  Form  10-K for the year  ended  December  31,  2000).  As more  fully
described in that note, these adjustments were recorded in the fourth quarter of
2000, as the Company  could not  determine  the amount of charges  applicable to
proceeding  interim periods.  Therefore,  information  presented for the quarter
ended  March 31,  2000  reflects  amounts  previously  reported  and may contain
balances that were not adjusted until the fourth quarter of 2000.

2. Subsequent Events

         On  June  20,  2001,  the  Company  began  the   implementation   of  a
restructuring  plan that will close its  remanufacturing  facility  in  Lansing,
Michigan and consolidate remanufacturing operations in Richmond, Virginia; close
five unprofitable sales offices located in Cincinnati, Indianapolis,  Nashville,
Lansing and Boston;  reduce the size of sales offices in  Philadelphia,  Atlanta
and Washington,  D.C.; and restructure  back office  operations at the Company's
headquarters in Richmond,  Virginia.  Approximately 65 employees are expected to
be affected by the restructuring initiatives.  The restructuring initiatives are
expected to be fully  implemented  within 30 days.  Severance will be offered to
employees affected by the restructuring initiatives. The Company expects to hire
additional employees in Richmond as necessary to meet production requirements.

         As a result of the  restructuring,  the  Company  expects  to write off
approximately $3.6 million of goodwill associated with the Lansing facility. The
Company also  anticipates  a yet to be  determined  restructuring  charge in the
second and third quarters of 2001.




                                       4
<PAGE>

                             OPEN PLAN SYSTEMS, INC.

             Notes to Consolidated Financial Statements (Unaudited)
                                 March 31, 2001


3. Mexican Subsidiaries

         In January 2000, the Company entered into a Joint Venture  Agreement to
open a new  sales  office  in  Mexico  City,  Mexico.  The  Company  contributed
approximately  $50,000,  for an 80% interest in the venture.  The Joint  Venture
Agreement created two new companies,  Open Plan Systems,  S. de R.L. de C.V. and
Open  Plan  Servicios,  S. de R.L.  de C.V.,  each of which is 80%  owned by the
Company.  The Company has reported minority interest related to the earnings and
the equity of the minority  partner in the accompanying  consolidated  financial
statements.

4. Inventories

         Inventories  were in two main stages of completion and consisted of the
following (amounts in thousands):

                                           March 31,          December 31,
                                             2001                 2000
                                         ---------------------------------
                                          (Unaudited)

Components and fabric                        $  4,652            $ 4,494
Jobs in process and finished goods              1,352              1,784
                                         ---------------------------------
                                             $  6,004            $ 6,278
                                         =================================


5. Income Taxes

         The Company did not record any tax benefit associated with the net loss
for the quarter ended March 31, 2001 due to the  uncertainty of the  realization
of potential  benefits of future  deductions.  The Company will  re-evaluate the
realizability of potential net deferred tax assets in future periods.

6. Indebtedness

         In June 2000,  the Company  borrowed  $2.5  million  from the  Michigan
Strategic Fund following the issuance and sale by the Fund of certain Industrial
Revenue Bonds ("Industrial  Revenue Bonds") for construction of a new production
facility in Lansing,  Michigan.  The proceeds were placed into an escrow account
with the trustee for use in connection with the building of the facility. At the
same time, the Company  entered into a letter of credit  facility with a bank to
support the financing on the facility.  At March 31, 2001,  the Company had $2.2
million  of cash and  cash  equivalents  externally  restricted  under  the bond
indenture,  which is reflected in the  consolidated  balance sheets.



                                        5
<PAGE>

                             OPEN PLAN SYSTEMS, INC.

             Notes to Consolidated Financial Statements (Unaudited)
                                 March 31, 2001


Borrowings  associated with the Industrial Revenue Bonds totaled $2.5 million at
March  31,  2001 and bore  interest  at a weekly  variable  tax  exempt  rate of
interest  based upon the credit  worthiness of the  underlying  letter of credit
(3.60% at March 31, 2001). The obligations are secured by  substantially  all of
the assets of the Company. The bond indenture and related agreements require the
Company to meet certain  restrictive  covenants,  including defined tangible net
worth, an interest  coverage ratio and certain other covenants.  The Company was
not in  compliance  at December  31,  2000 and  thereafter  with  certain of the
covenants,  and  therefore  this debt is  included  in the  current  portion  of
long-term debt in the accompanying balance sheets.

         During April 2000,  the Company  negotiated a revolving  line of credit
with a financial  institution,  which is secured by substantially all the assets
of the  Company.  This credit  facility  provided  for  borrowings  up to 80% of
eligible  accounts  receivable  plus the lesser of 50% of eligible  inventory or
$2,000,000, with a maximum borrowing amount of $5,000,000. The maximum borrowing
amount was  increased,  pursuant to an amendment by the parties  dated August 1,
2000,  to  $5,250,000.  Borrowings  under the line of credit bear  interest at a
floating rate, which is linked to either LIBOR or prime.  Outstanding borrowings
under the line of  credit  amounted  to  $4,476,000  at March 31,  2001 and bore
interest at a rate of 7.33%.

         The letter of credit and revolving  line of credit  facilities are with
the same  financial  institution  and are  cross-collateralized.  The  financial
institution  requires  the  Company  to  meet  certain  restrictive   covenants,
including a defined  tangible net worth, an interest  coverage ratio and certain
other covenants.

         At December 31, 2000 and thereafter,  the Company was not in compliance
with certain of the  covenants  contained in the letter of credit and  revolving
line of credit facilities.  The Company's independent auditors, in its report on
the  Company's  financial  statements  for  December 31,  2000,  have  expressed
substantial  doubt as to the Company's  ability to continue as a going  concern.
See Note 1 to the consolidated  financial  statements contained in the Company's
Form 10-K for the fiscal year ended December 31, 2000 (the "Form 10-K").

         In May 2001, the Company entered into a forbearance  agreement  whereby
its bank agreed to  temporarily  waive its  existing  right to declare  defaults
relating to the Company's  failure to comply with certain loan covenants through
June 30, 2001.  The  forbearance  agreement  provides that the bank will refrain
from exercising any rights based on such a default,  including  accelerating the
maturity  of the loans  under the two credit  facilities,  until  after June 30,
2001. Conditions to the forbearance agreement include a limitation on borrowings
under the line of credit of $4,650,000.  Also, any  disbursements by the Company
of the approximately  $2.2 million at March 31, 2001 in




                                       6
<PAGE>

                             OPEN PLAN SYSTEMS, INC.

             Notes to Consolidated Financial Statements (Unaudited)
                                 March 31, 2001


remaining  proceeds from the Industrial Revenue Bonds held as restricted cash by
the Company are subject to the approval of the bank in its sole  discretion (see
Note 10 for additional information).  Pursuant to the forbearance agreement, the
bank maintains the right to declare a default and accelerate the loans under the
two  facilities  after  June  30,  2001 if the  parties  have not  entered  into
amendments to the existing loan arrangements.

         As of June 27,  2001,  the  Company  has been  unable  to  negotiate  a
permanent waiver of the Company's loan covenant  violations,  as well as revised
loan  covenants,  or  an  extension  of  the  forbearance  agreement.   However,
discussions  with the bank are continuing.  Any agreement  reached with the bank
could  result in new terms which are less  favorable  than  current  terms under
existing loan agreements and could involve a reduction in availability of funds,
an increase in interest rates and shorter maturities, among other things. If the
Company is not successful in securing an extension of the forbearance  agreement
or  permanent  waivers and loan  covenant  amendments,  it will need to seek new
financing   arrangements   from  other  lenders.   Such  alternative   financing
arrangements   may  be   unavailable  to  the  Company  or  available  on  terms
substantially less favorable to the Company than its existing credit facilities.
If the  Company is unable to either  procure  an  extension  of the  forbearance
agreement,  permanent  covenant  violation waivers and covenant  amendments with
respect  to  existing  facilities  or  acceptable  alternative  financing,  such
failures  could  have a  material  adverse  effect  on the  Company's  financial
condition and results of operations.  No assurance can be given that the Company
will be able to obtain an  extension  of the  forbearance  agreement,  permanent
covenant  violation waivers and revised loan covenants or refinance its existing
obligations.

7. Comprehensive Income (Loss)

         Comprehensive  loss for the quarter  ended March 31, 2001 was $983,000,
as  compared  to a net loss of  $981,000.  The  difference  between net loss and
comprehensive loss is due to foreign currency translation gains and losses.

8. Repurchases of Common Stock

         In 2000, the Company's Board of Directors approved the repurchase of up
to 100,000 shares of the Company's Common Stock.  During the quarter ended March
31,  2001,  the  Company  repurchased  15,000  shares of its Common  Stock at an
aggregate cost of approximately $24,000.

9. Impact of Recently Issued Standards

         The Company  adopted the  provisions of Statement No. 133,  "Accounting
for  Derivative  Instruments  and Hedging  Activities,"  as  amended,  effective
January 1, 2001. The



                                       7
<PAGE>

                             OPEN PLAN SYSTEMS, INC.

             Notes to Consolidated Financial Statements (Unaudited)
                                 March 31, 2001


implementation  of this new  standard  did not  have a  material  effect  on the
Company's consolidated results of operations or financial position.

10. Other

         On April 30, 2000, the Company  signed a contract for the  construction
of a new  production  facility in  Lansing,  Michigan.  The Company  purchased a
5-acre  building  site and is in the process of  constructing  an  approximately
70,000 square-foot facility. The cost of completing the project is approximately
$1.9 million. The Company has been unable to make two progress payments totaling
approximately  $938,000.  The  contractor  has  declared  a  default  under  the
construction  agreement.  The forbearance  agreement with the bank prohibits the
Company from utilizing the approximately $2.2 million of remaining cash proceeds
from the Company's Industrial Revenue Bonds. At this time, the Company is unable
to  determine  whether  the bank will permit  such  payments in the future.  The
Company is presently  unable to determine  what impact these actions may have on
the Company's financial position or results of operations.



















                                       8
<PAGE>

                             OPEN PLAN SYSTEMS, INC.



            Item 2: Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

              THREE MONTHS ENDED MARCH 31, 2001 COMPARED WITH 2000

Delay in Filing of Form 10-Q for the Quarter Ended March 31, 2001

         Reasons for the Delay. As previously disclosed in the Form 10-K for the
fiscal year ended December 31, 2000 (the "Form 10-K"),  the Company  experienced
delays in completing its 2000 financial  statements and filing the Form 10-K and
this Form 10-Q. In the process of preparing the Company's  financial  statements
for  the  year  ended  December  31,  2000,  the  Company's  management  and its
independent auditors determined that certain balance sheet accounts,  including,
but not  limited  to,  inventory,  accounts  receivable  and cash,  had not been
periodically  reconciled  to  subsidiary  records  so as to  permit  the  timely
preparation of year end financial  statements.  The fiscal 2000 year end closing
process and the subsequent  time  consuming  task of reconciling  these accounts
were further  complicated  by the unexpected  departures of the Company's  Chief
Financial  Officer and Controller in December 2000 and its Assistant  Controller
in March 2001.

         As a result of the Chief Financial Officer and Controller's  departure,
the  Company  was left at year  end  2000  without  the  continuity  customarily
provided by a key member of its financial  management team. The departure of the
Company's Assistant Controller during the process of resolving the recordkeeping
issues and preparing  financial  statements  caused further delay as the Company
then had to recruit and hire two outside  experienced  financial  consultants to
assist in the year end closing process and the preparation of the Company's Form
10-K and Form  10-Q.  The  absence  of  employees  familiar  with the  Company's
operations,   information   systems,   banking   arrangements   and   accounting
transactions  for the year severely  hampered the  Company's  ability to quickly
address  the  accounting  deficiencies  and to complete  customary  year end and
quarter-end closing procedures.

         The various  delays caused by the time  consuming task of resolving the
recordkeeping  issues and by the turnover in financial personnel during the year
end closing  and audit  process led to the filing of the Form 10-K and Form 10-Q
after their respective due dates. For additional information,  see "Management's
Discussion and Analysis of Financial Condition and Results of Operations" in the
Company's Form 10-K.

         Accounting Deficiencies.  The Company's senior management and the Audit
Committee  of the  Board  of  Directors  have  been  advised  by  the  Company's
independent  auditors  that  because of the lack of  experienced  financial  and
accounting  personnel  as a  result  of the  turnover  at the  Company  and  the
Company's  inability to reconcile  accounts



                                       9
<PAGE>

                             OPEN PLAN SYSTEMS, INC.



in a timely manner,  there existed a material weakness in the Company's internal
controls and  procedures  during 2000 and for the quarter  ended March 31, 2001.
Certain  weaknesses in the Company's  inventory  cost  accounting and management
information systems and inventory  procedures also contributed to the accounting
difficulties.

         No evidence of  misappropriation of funds or other malfeasance has been
discovered  by  senior  management  or  financial  consultants  retained  by the
Company.

         In connection  with the fiscal 2000 year end closing  process,  certain
weaknesses  were  discovered  in the  Company's  inventory  systems  and related
procedures that may require  replacement or upgrading of the Company's inventory
cost accounting and management  information  systems and additional  training of
personnel.  These system and procedural weaknesses led to the Company performing
an  additional  physical  inventory  count  at  March  31,  2001  to  assist  in
determining year end and quarter-end inventory balances.

         Remedial  Actions.  The Board of Directors of the Company has taken and
intends  to take  appropriate  remedial  actions to assure  that the  accounting
difficulties encountered during 2000 and first quarter 2001 are resolved. In the
short  term,  two  experienced  financial  consultants  were  retained by senior
management  and the Board of Directors  to provide  full time interim  financial
assistance,  including  assisting in the completion of the financial  statements
for the first quarter of 2001. At the  direction of the Audit  Committee,  these
consultants have begun to institute proper accounting reconciliation procedures.
Continued  enforcement of such  procedures  should prevent a reoccurrence of the
recordkeeping  problems  experienced  in 2000 and the first  quarter of 2001. In
addition,  with respect to inventory,  the Audit Committee expects to review and
evaluate the inventory cost accounting and management  information  systems,  as
well as related procedures,  and make recommendations to the Board of Directors.
The Board of  Directors  intends to effect any  necessary  improvements  to such
systems and  procedures  as soon as  practicable.  In the  interim,  in order to
mitigate  additional  problems,  quarterly  physical  inventory counts have been
implemented,  beginning  with the quarter  ended March 31,  2001.  Finally,  the
Company is  actively  searching  for a  permanent  chief  financial  officer and
controller to fill current vacancies.

Management Reorganization

         The Company's  Board of Directors  accepted the resignation of Mr. John
L. Hobey as Chief Executive  Officer and a director of the Company effective May
25, 2001.  Following Mr.  Hobey's  resignation,  the Board  appointed an interim
Operating  Committee to manage the day-to-day  operations of the Company until a
replacement  can be found.  The members of the Operating  Committee are David E.
Green, Vice President,  Stephen P. Hindle,  Vice  President-Sales and Marketing,
Robert E. O'Neil,  Jr., Vice  President-National  Accounts and Thomas M. Mishoe,
Jr., the former Chief Financial



                                       10
<PAGE>

                             OPEN PLAN SYSTEMS, INC.



Officer of Eskimo Pie Corporation and currently a consultant to the Company. The
Operating  Committee also has been tasked with the responsibility of formulating
plans to address current issues facing the Company, including the exploration of
all  available  strategic  alternatives  to enhance  financial  performance  and
shareholder  value.  The Board of Directors is actively  engaged in recruiting a
chief executive officer.

Restructuring

         As a result of analysis performed by the Operating  Committee,  on June
20, 2001, the Company began the implementation of a restructuring plan that will
close  its  remanufacturing  facility  in  Lansing,   Michigan  and  consolidate
remanufacturing operations in Richmond,  Virginia; close five unprofitable sales
offices  located in  Cincinnati,  Indianapolis,  Nashville,  Lansing and Boston;
reduce the size of sales offices in Philadelphia,  Atlanta and Washington, D.C.;
and  restructure  back  office  operations  at  the  Company's  headquarters  in
Richmond,  Virginia.  Approximately  65 employees are expected to be affected by
the restructuring initiatives.  The restructuring initiatives are expected to be
fully  implemented  within  30 days.  Severance  will be  offered  to  employees
affected  by  the  restructuring  initiatives.   The  Company  expects  to  hire
additional employees in Richmond as necessary to meet production requirements.

         As a result of the  restructuring,  the  Company  expects  to write off
approximately $3.6 million of goodwill associated with the Lansing facility. The
Company also  anticipates  a yet to be  determined  restructuring  charge in the
second and third quarters of 2001.

Results of Operations

         During the fourth  quarter of the year ended  December  31,  2000,  the
Company  recorded  significant  fourth quarter  adjustments  (see Note 13 to the
Company's  Form  10-K for the year  ended  December  31,  2000).  As more  fully
described in that note, these adjustments were recorded in the fourth quarter of
2000, as the Company  could not  determine  the amount of charges  applicable to
proceeding  interim periods.  Therefore,  information  presented for the quarter
ended  March 31,  2000  reflects  amounts  previously  reported  and may contain
balances that were not adjusted until the fourth quarter of 2000.

         Net  Sales.  Sales  for the three  months  ended  March  31,  2001 were
$9,962,000, an increase of approximately $629,000 or 6.7% versus the same period
in 2000.  The increase in first  quarter  2001 sales was due  primarily to sales
generated  by the  Company's  80% owned joint  venture in Mexico  City,  Mexico.
Exclusive of  approximately  $970,000 of sales  generated by the joint  venture,
sales by the  Company's  domestic  sales  offices and  National  Accounts  group
decreased by approximately 3.7% versus the same period in 2000.

         Gross Margin.  The gross margin decreased to 25.2% in the first quarter
of 2001 from 31.2% in the first  quarter of 2000.  The  Company's  gross  margin
during the first quarter of 2001 was impacted negatively by increased sales with
lower  margins  generated by the



                                       11
<PAGE>

                            OPEN PLAN SYSTEMS, INC.



Company's  joint  venture  in Mexico  City,  as  discussed  above.  Higher  than
anticipated  costs were  incurred  with  shipping  product  across the border to
Mexico.  The Company is in the process of developing  procedures that management
believes will minimize these costs in the future. Additionally, the gross margin
was impacted by increased  discounting  pressure in several markets. The Company
anticipates  that  discounting  pressure will continue due to the slowing of the
economy.  The Company is pursuing avenues to improve its production and shipping
activities to reduce costs and to continue to improve quality.

         Operating  Expenses.  The  Company's  selling  and  marketing  expenses
increased by $475,000 to $2,402,000  from the  $1,927,000  reported in the first
quarter of 2000.  This  increase  was due to the opening of two  domestic  sales
offices after the first quarter of 2000 and the office in Mexico City, Mexico.

         General and  administrative  expenses increased by $316,000 to $910,000
in the first quarter of 2001 from the $594,000  reported in the first quarter of
2000.  This  increase  was  primarily  due to  increased  accounting,  legal and
computer-consulting  fees associated with the delay in filing the Company's Form
10-K and first quarter 2001 Form 10-Q, as previously discussed.

         Other Non-Operating  Income and Expense.  Total other expense increased
to $114,000 for the first  quarter of 2001 versus  $96,000 for the first quarter
of 2000.  The minority  interest in the Mexico City joint  venture  accounts for
$37,000 of the $114,000 in the first quarter of 2001.

         Income Taxes.  In the first quarter of 2001, the Company did not record
any tax  benefit  associated  with the net loss  due to the  uncertainty  of the
realization  of potential  tax benefits of future  deductions.  The Company will
re-evaluate  the  realizablity  of  potential  net deferred tax assets in future
periods.

         Net Income  (Loss).  The net loss for the quarter  ended March 31, 2001
was $981,000 versus net income of $124,000 for the quarter ended March 31, 2000.
The net loss in 2001 was due principally to lower margins, costs associated with
the  opening of new sales  offices  and an  increase  in  accounting,  legal and
computer  consulting fees associated with the delay in filing the Company's Form
10-K and first quarter Form 10-Q, as previously discussed.

Liquidity and Capital Resources

         Violations  of Loan  Covenants.  The Company  maintains two bank credit
facilities  consisting  of a  letter  of  credit  facility  associated  with the
issuance of $2.5 million of Industrial Revenue Bonds to finance the construction
of a new  production  facility and a revolving  line of credit.  At December 31,
2000, the revolving line of credit  provided for a maximum  borrowing  amount of
$5,250,000  at  variable  interest  rates.  The  letter of credit  facility  and
revolving  line of  credit  agreements  require  the  Company  to  meet  various
restrictive  covenants,  including  a defined  tangible  net worth,  an interest
coverage ratio and




                                       12
<PAGE>

                            OPEN PLAN SYSTEMS, INC.



certain other  covenants.  At December 31, 2000 and thereafter,  the Company was
not in  compliance  with  certain of the  covenants  contained  in the letter of
credit facility and the revolving line of credit agreements.  As a result of the
covenant violations as well as the significant net loss in fiscal year 2000, the
Company's auditors, in its report filed as part of the Form 10-K, have expressed
substantial  doubt as to the Company's  ability to continue as a going  concern.
See  "Forward  Looking  Statements"  below and Note 1 to the  December  31, 2000
consolidated financial statements contained in the Form 10-K.

         In May 2001, the Company entered into a forbearance  agreement  whereby
the bank agreed to  temporarily  waive its  existing  right to declare  defaults
relating to the Company's  failure to comply with certain loan covenants through
June 30, 2001.  The  forbearance  agreement  provides that the bank will refrain
from exercising any rights based on such a default,  including  accelerating the
maturity  of the loans  under the two credit  facilities,  until  after June 30,
2001. Conditions to the forbearance agreement include a limitation on borrowings
under the line of credit of $4,650,000.  As of June 27, 2001, approximately $4.0
million was outstanding under the line of credit. Also, any disbursements by the
Company  of the  approximately  $2.2  million  at March  31,  2001 in  remaining
proceeds  from the  Industrial  Revenue  Bonds  held as  restricted  cash by the
Company are subject to the approval of the bank in its sole discretion. Finally,
the  Company  has paid the  bank a  forbearance  fee of  $89,368,  which  may be
credited  against any fees associated with any subsequent  credit  arrangements.
Pursuant to the forbearance agreement, the bank maintains the right to declare a
default and accelerate the loans under the two facilities after June 30, 2001 if
the parties have not entered into amendments to the existing loan arrangements.

         As of June 27,  2001,  the  Company  has been  unable  to  negotiate  a
permanent waiver of the Company's loan covenant  violations,  as well as revised
loan  covenants,  or  an  extension  of  the  forbearance  agreement.   However,
discussions  with the bank are continuing.  Any agreement  reached with the bank
could  result in new terms which are less  favorable  than  current  terms under
existing loan agreements and could involve a reduction in availability of funds,
an increase in interest rates and shorter maturities, among other things. If the
Company is not successful in securing an extension of the forbearance  agreement
or  permanent  waivers and loan  covenant  amendments,  it will need to seek new
financing   arrangements   from  other  lenders.   Such  alternative   financing
arrangements   may  be   unavailable  to  the  Company  or  available  on  terms
substantially less favorable to the Company than its existing credit facilities.
If the  Company is unable to either  procure  an  extension  of the  forbearance
agreement,  permanent  covenant  violation waivers and covenant  amendments with
respect  to  existing  facilities  or  acceptable  alternative  financing,  such
failures  could  have a  material  adverse  effect  on the  Company's  financial
condition and results of operations.  No assurance can be given that the Company
will be able to obtain an  extension  of the  forbearance  agreement,  permanent
covenant  violation waivers and revised loan covenants or refinance its existing
obligations.




                                       13
<PAGE>

                            OPEN PLAN SYSTEMS, INC.



         Expected Future Cash Flows.  The Company can give no assurance that its
current cash balances plus cash flows from  operations,  if any, and  borrowings
available  under  its line of  credit  will be  adequate  to fund  its  expected
operating  and capital  needs for the next twelve  months.  The  adequacy of the
Company's  cash  resources is primarily  dependent  on the  Company's  operating
results over the next twelve  months and its ability to  renegotiate  its credit
arrangements with its existing bank or procure alternate financing, all of which
are subject to substantial uncertainties.

         Cash flow from  operations  for the 2001 year will be dependent,  among
other things,  upon the effect of the current economic slowdown on the Company's
sales,  and new  management's  ability to implement plans to reduce expenses and
improve the Company's operating performance and financial position.

         Under the May 2001  forbearance  agreement  between the Company and the
bank,  the  Company's  maximum  line of credit was reduced  from  $5,250,000  to
$4,650,000.  As of June 27,  2001,  the  Company had no  availability  under the
facility.  In addition,  the  forbearance  agreement  prohibits the Company from
utilizing  the  approximately  $2.2 million of remaining  cash proceeds from the
Company's  Industrial  Revenue  Bonds  related  to  the  new  Lansing,  Michigan
production  facility now under  construction  without the prior  approval of the
bank.  The cost of completing  the project is  approximately  $1.9 million.  The
Company has been unable to make two  progress  payments  totaling  approximately
$938,000 due on the project in June 2001.  The contractor has declared a default
under the  construction  agreement.  The Company is unable to  determine at this
time  whether the bank will permit such  payments in the future.  The failure to
return to  profitability  and  optimize  operating  cash flow in the short term,
obtain the bank's  permission to utilize the bond proceeds for progress payments
on the Lansing facility, and successfully renegotiate its credit agreements with
the bank or procure alternate financing, could have a material adverse effect on
the Company's liquidity position and capital resources.

Seasonality and Impact of Inflation

         The  Company has no  discernable  pattern of  seasonality.  Because the
Company  typically  ships  Work  Stations  within  four  weeks  of an  order,  a
substantial  portion of the  Company's  revenues in each  quarter  results  from
orders placed by customers during that quarter. As a result, the Company's sales
may vary from quarter to quarter.

         Inflation  has not had a material  impact on the Company's net sales or
income to date. However,  there can be no assurances that the Company's business
will not be affected by inflation in the future.

Forward-Looking Statements

         The foregoing discussion contains certain  forward-looking  statements,
which may be  identified  by phrases such as "the  Company  expects" or words of
similar effect. The Private Securities  Litigation Reform Act of 1995 provides a
safe harbor for forward-looking  statements.  The Company has identified certain
important  factors  that in some cases have



                                       14
<PAGE>

                            OPEN PLAN SYSTEMS, INC.



affected, and in the future could affect, the Company's actual results and could
cause the  Company's  actual  results for fiscal 2001 and any interim  period to
differ  materially  from  those  expressed  or  implied  in any  forward-looking
statements  made by, or on behalf of, the Company.  These  factors are set forth
under the caption  "Forward-Looking  Statements" in Item 7 of the Company's Form
10-K for the fiscal year ended  December  31,  2000,  a copy of which is on file
with the  Securities  and Exchange  Commission.  The Company  assumes no duty to
update any of the forward-looking statements of this report.




















                                       15
<PAGE>

                             OPEN PLAN SYSTEMS, INC.



         Item 3: Quantitative and Qualitative Disclosures about Market Risk

         The Company is exposed to changes in interest rates  primarily from its
revolving  line of credit  arrangement  and from the  letter of credit  facility
related to the Industrial  Revenue Bonds issued to fund the  construction of the
new production facility in Lansing,  Michigan. The Company's interest expense is
affected by changes in  short-term  interest on the debt  outstanding  under the
revolving line of credit and Industrial  Revenue Bonds.  These  borrowings  bear
interest at variable rates (the "Borrowing Rates").  Assuming: (i) the Borrowing
Rates vary by 100 basis points from their current  levels in any given month and
(ii) the Company  maintains an  aggregate  outstanding  debt balance  subject to
these  Borrowing  Rates of $5.7 million  during the month of variance,  interest
expense would vary by approximately  $5,000 for that month. The Company does not
use derivative instruments.


















                                       16
<PAGE>

                             OPEN PLAN SYSTEMS, INC.

                                     PART II
                                OTHER INFORMATION


Item 1.       Legal Proceedings
              -----------------

              Not applicable.

Item 2.       Changes in Securities and Use of Proceeds
              -----------------------------------------

              Not applicable.

Item 3.       Defaults upon Senior Securities
              -------------------------------

              The Company is not in compliance with certain loan covenants under
              its bank credit  facilities.  See Part I, Item 2 and Note 5 to the
              Consolidated Financial Statements for additional information.

Item 4.       Submission of Matters to a Vote of Security Holders
              ---------------------------------------------------

              Not Applicable

Item 5.       Other Information
              -----------------

              As noted in Part I, Item 2, the Company's  Form 10-K and Form 10-Q
              filings  were delayed due to  unanticipated  turnover in financial
              personnel,   including  the  departure  of  the  Company's   Chief
              Financial   Officer  in  December  2000,  and  unresolved   issues
              regarding inventory balances and certain other items. As a result,
              the Company  postponed its annual meeting of  shareholders,  which
              was  originally  expected to be held in May, 2001. The Company has
              rescheduled its annual meeting of shareholders for August 7, 2001.

Item 6.       Exhibits and Reports on Form 8-K
              --------------------------------

              (a)   Exhibits:
                    ---------

              The  registrant  has included the following  exhibits  pursuant to
              Item 601 of Regulation S-K.

                 Exhibit No.     Description
              ------------------------------------------------------------------

                     11          Statement Re: Computation of Per Share Earnings




                                       17
<PAGE>

                             OPEN PLAN SYSTEMS, INC.



              (b)   Reports on Form 8-K
                    -------------------

                    Not applicable.














                                       18
<PAGE>

                                   SIGNATURES


         Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended,  the  registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.



                                         OPEN PLAN SYSTEMS, INC.
                                         (Registrant)


Date: June 27, 2001                     By:  /s/ Anthony F. Markel
                                             -----------------------------------
                                             Anthony F. Markel
                                             Chairman of the Board


Date: June 27, 2001                      By: /s/ Anthony F. Markel
                                             -----------------------------------
                                             Anthony F. Markel
                                             (Principal Financial Officer)















                                       19
<PAGE>


                                  EXHIBIT INDEX


No.               Description
---               -----------

11                Statement Re:  Computation of Per Share Earnings