UNITED STATES
                      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 Quarter Ended June 30, 2000

                                    OR

[ ]   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 0-21952


                         AMERICAN SAFETY RAZOR COMPANY
            (Exact name of registrant as specified in its charter)



      Delaware                                        54-1050207
      --------                                        ----------
(State of incorporation)                (I.R.S. Employer Identification Number)


240 Cedar Knolls Road, Suite 401, Cedar Knolls,  New Jersey 07927
-----------------------------------------------------------------
(Address of  principal  executive  offices,  including  zip code)


       (973) 753-3000
       --------------
(Registrant's telephone number)

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



Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of August 2, 2000.

            Class                               Outstanding at August 2, 2000
            -----                               -----------------------------

Common Stock, $.01 Par Value                           12,110,349




<PAGE>




                         AMERICAN SAFETY RAZOR COMPANY


                                     Index


                                                                   Page Number
                                                                   -----------

Part I.     Financial Information

   Item 1.  Financial Statements

            Condensed Consolidated Balance Sheets                            1

            Condensed Consolidated Statements of Operations (Unaudited)      3

            Condensed Consolidated Statements of Comprehensive Income
            (Unaudited)                                                      4

            Condensed Consolidated Statements of Cash Flows (Unaudited)      5

            Notes to Condensed Consolidated Financial Statements (Unaudited) 6

   Item 2.  Management's Discussion and Analysis of Financial
            Condition and Results of Operations                             20

   Item 3.  Quantitative and Qualitative Disclosures About Market Risk      28


Part II.    Other Information

   Item 1.  Legal Proceedings                                               28

   Item 6.  Exhibits and Reports on Form 8-K                                28

Signatures                                                                  29



<PAGE>




                          AMERICAN SAFETY RAZOR COMPANY
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (In thousands)




                                                             Company
                                                  ----------------------------
                                                    June 30,      December 31,
                                                     2000           1999
                                                  -----------     ------------
                                                  (Unaudited)

ASSETS

Current assets:
    Cash and cash equivalents                       $  3,776        $  12,500
    Accounts receivable, net                          47,280           46,252
    Inventories                                       60,819           54,404
    Deferred income taxes                              6,795            6,814
    Prepaid expenses                                   2,345            1,882
                                                    --------         --------

        Total current assets                         121,015          121,852

Property and equipment                               104,661           98,398
Less accumulated depreciation                        (14,878)          (8,407)
                                                    --------         --------
                                                      89,783           89,991

Intangible assets, net:
    Goodwill, trademarks and patents                 157,506          159,675
    Other                                              5,976            6,826
                                                    --------         --------
                                                     163,482          166,501

Prepaid pension cost and other                        25,886           24,527
                                                    --------         --------




Total assets                                        $400,166         $402,871
                                                    ========         ========













See accompanying notes.

                                       -1-

<PAGE>





                          AMERICAN SAFETY RAZOR COMPANY
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                        (In thousands, except share data)

<TABLE>
<CAPTION>



                                                                             Company
                                                                  -------------------------------
                                                                    June 30,         December 31,
                                                                     2000              1999
                                                                  -----------    ----------------
                                                                  (Unaudited)
<S>                                                                 <C>                 <C>
LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
    Accounts payable                                                $ 16,334            $ 13,711
    Accrued expenses and other                                        21,465              23,131
    Current maturities of long-term obligations                       10,070              10,508
                                                                    --------            --------

        Total current liabilities                                     47,869              47,350

Long-term obligations                                                180,126             175,108
Retiree benefits and other                                            27,662              27,333
Deferred income taxes                                                 24,451              24,078
                                                                    --------            --------

Total liabilities                                                    280,108             273,869
                                                                    --------            --------

Stockholders' equity:
    Common stock, $.01 par value, 25,000,000
        shares authorized; 12,110,349 shares issued and
        outstanding at June 30, 2000 and December 31, 1999               121                 121
    Additional paid-in capital                                       172,843             172,843
    Advances to RSA Holdings Corporation, net                        (52,383)            (42,714)
    Retained earnings (accumulated deficit)                              334              (1,258)
    Accumulated other comprehensive (loss) income                       (857)                 10
                                                                    --------            --------
                                                                     120,058             129,002
                                                                    --------            --------

Total liabilities and stockholders' equity                          $400,166            $402,871
                                                                    ========            ========

</TABLE>












See accompanying notes.

                                       -2-

<PAGE>





                          AMERICAN SAFETY RAZOR COMPANY
           CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
                      (In thousands, except per share data)

<TABLE>
<CAPTION>


                                                                     Company       Predecessor  Company  Predecessor
                                                                -----------------  -----------  -------  -----------
                                                                          Period     Period                Period
                                                                 Three     from       from       Six        from
                                                                 Months  April 24,   April 1,    Months   January 1,
                                                                 Ended    1999 to     1999 to    Ended     1999 to
                                                                June 30,  June 30,  April 23,   June 30,   April 23,
                                                                  2000     1999        1999       2000       1999
                                                                -------- ---------  ---------   -------- ----------


<S>                                                              <C>      <C>        <C>        <C>        <C>
Net sales                                                        $79,921  $59,942    $17,304    $157,130   $87,591
Cost of sales:
    Cost of sales                                                 53,419   38,185     11,691     105,220    58,520
    Purchase accounting adjustment to inventory                        -    9,008          -           -         -
                                                                 -------  -------    -------    --------   -------

    Gross profit                                                  26,502   12,749      5,613      51,910    29,071

Selling, general and administrative expenses                      17,308   13,130      4,922      37,008    21,429
Amortization of intangible assets                                  1,174      919        188       2,362       835
Transaction expenses                                                   -        -     11,440           -    11,440
                                                                  -------  -------    -------   --------   -------

    Operating income (loss)                                        8,020   (1,300)   (10,937)     12,540    (4,633)

Interest expense                                                   4,839    3,972        877       9,553     3,907
                                                                 -------  -------    -------    --------   -------

    Income (loss) before income taxes
        and extraordinary item                                     3,181   (5,272)   (11,814)      2,987    (8,540)

Income taxes (benefit)                                             1,486   (1,547)    (2,142)      1,395      (842)
                                                                 -------  -------    -------    --------   -------

    Income (loss) before extraordinary item                        1,695   (3,725)    (9,672)      1,592    (7,698)

Extraordinary item, net of income tax benefit                          -      611        118           -       118
                                                                  -------  -------    -------    -------   -------

Net income (loss)                                                $ 1,695  $(4,336)   $(9,790)    $ 1,592   $(7,816)
                                                                 =======  =======    =======     =======   =======


Basic earnings per share:
    Income (loss) before extraordinary item                        $0.14   $(0.31)    $(0.80)    $0.13    $(0.64)
    Extraordinary item                                                 -    (0.05)     (0.01)        -     (0.01)
                                                                   -----   ------     ------     -----    ------
    Net income (loss)                                              $0.14   $(0.36)    $(0.81)    $0.13    $(0.65)
                                                                   =====   ======     ======     =====    ======

    Weighted average number of shares outstanding                 12,110   12,110     12,110    12,110    12,110
                                                                  -------  -------    -------  --------   -------

Diluted earnings per share:
    Income (loss) before extraordinary item                        $0.14   $(0.31)    $(0.80)    $0.13    $(0.64)
    Extraordinary item                                                 -    (0.05)     (0.01)        -     (0.01)
                                                                   -----   ------     ------     -----    ------
    Net income (loss)                                              $0.14   $(0.36)    $(0.81)    $0.13    $(0.65)
                                                                   =====   ======     ======     =====    ======

    Weighted average number of shares outstanding                 12,110   12,122     12,207    12,110    12,198
                                                                  ======   ======     ======    ======    ======

</TABLE>






See accompanying notes.


                                       -3-

<PAGE>



      CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)
                                 (In thousands)
<TABLE>
<CAPTION>


                                                                     Company       Predecessor  Company  Predecessor
                                                               ------------------- -----------  -------  -----------
                                                                          Period     Period                Period
                                                                 Three     from       from        Six       from
                                                                 Months  April 24,   April 1,    Months   January 1,
                                                                 Ended    1999 to    1999 to     Ended     1999 to
                                                                June 30,  June 30,  April 23,   June 30,   April 23,
                                                                  2000     1999        1999       2000       1999
                                                                -------- ---------  ---------   --------  ----------

<S>                                                              <C>      <C>       <C>          <C>       <C>
Net income (loss)                                                $1,695   $(4,336)  $(9,790)     $1,592    $(7,816)
Other comprehensive income (loss):
   Foreign currency translation adjustments                        (559)     (310)      317        (867)      (116)
                                                                 ------   -------   --------     ------    -------
Comprehensive income (loss)                                      $1,136   $(4,646)  $(9,473)     $  725    $(7,932)
                                                                 ======   =======   =======      ======    =======

</TABLE>




See accompanying notes.


                                       -4-

<PAGE>





                          AMERICAN SAFETY RAZOR COMPANY
           CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
                                 (In thousands)
<TABLE>
<CAPTION>


                                                                                    Company            Predecessor
                                                                               ---------------------   -----------
                                                                                            Period       Period
                                                                                  Six        from         from
                                                                                 Months    April 24,    January 1,
                                                                                 Ended      1999 to      1999 to
                                                                                June 30,    June 30,    April 23,
                                                                                  2000       1999          1999
                                                                                --------  ----------   -----------
<S>                                                                              <C>        <C>           <C>
Operating activities
Net income (loss)                                                                $1,592     $(4,336)      $(7,816)
Adjustments to reconcile net income (loss) to net cash provided by
    (used in) operating activities:
        Extraordinary item                                                            -         611           118
        Depreciation and amortization                                             8,917       2,960         4,105
        Amortization of financing costs                                             726         346           180
        Retiree benefits and other                                               (1,897)       (872)         (719)
        Deferred income taxes                                                       392      (3,326)          232
        Changes in operating assets and liabilities:
             Accounts receivable                                                 (1,028)     (6,062)        7,710
             Inventories                                                         (6,415)      9,623        (7,748)
             Income taxes receivable                                                  -       1,518        (2,252)
             Prepaid expenses                                                      (463)        (18)          205
             Accounts payable                                                     2,623         216         1,723
             Accrued and other expenses                                          (1,666)      1,768        (1,072)
                                                                                 ------      ------        ------

Net cash provided by (used in) operating activities                               2,781       2,428        (5,334)

Investing activities
Capital expenditures                                                             (6,347)     (1,354)       (3,638)
Other                                                                                 -           2            49
                                                                                 ------     -------       -------

Net cash used in investing activities                                            (6,347)     (1,352)       (3,589)

Financing activities
Repayment of long-term obligations                                               (5,450)    (33,793)      (25,846)
Proceeds from borrowings                                                         10,000      32,801        65,337
Deferred loan fees                                                                  (39)          -        (7,606)
Proceeds from exercise of stock options                                               -           -             2
Advances to parent, net                                                          (9,669)          -       (24,155)
                                                                                 ------     -------       -------

Net cash (used in) provided by financing activities                              (5,158)       (992)        7,732
                                                                                 ------     -------       -------

Net (decrease) increase in cash and cash equivalents                             (8,724)         84        (1,191)
Cash and cash equivalents, beginning of period                                   12,500       2,262         3,453
                                                                                 ------      ------       -------

Cash and cash equivalents, end of period                                         $3,776      $2,346        $2,262
                                                                                 ======      ======        ======
</TABLE>



See accompanying notes.

                                       -5-

<PAGE>





                          AMERICAN SAFETY RAZOR COMPANY

        Notes to Condensed Consolidated Financial Statements (Unaudited)


NOTE A - BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles 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 generally  accepted  accounting  principles  for complete
financial statements. In the opinion of management,  all adjustments (consisting
of normal recurring accruals)  considered necessary for a fair presentation have
been included.  Operating results for the three and six month periods ended June
30, 2000, are not necessarily indicative of the results that may be expected for
the year ended December 31, 2000.

The  balance  sheet at  December  31,  1999 has been  derived  from the  audited
financial  statements  at that date but does not include all of the  information
and footnotes required by generally accepted accounting  principles for complete
financial statements.

For further  information,  refer to the  consolidated  financial  statements and
footnotes  thereto included in the  Registrant's  Annual Report on Form 10-K for
the year ended December 31, 1999.

As a result of the acquisition of the Company, effective April 23, 1999, and new
basis  of  accounting,   the  Company's  financial  statements  for  the  period
subsequent to the acquisition are not comparable to the Predecessor's  financial
statements for the period prior to the acquisition.


NOTE B - INVENTORIES

Inventories consisted of:

                                              Company
                                -------------------------------------
                                June 30, 2000       December 31, 1999
                                -------------       -----------------
                                          (In thousands)

Raw materials                         $29,008                 $27,928
Work-in-process                         6,260                   4,521
Finished goods                         21,319                  18,098
Operating supplies                      4,232                   3,857
                                      -------                 -------
                                      $60,819                 $54,404
                                      =======                 =======


NOTE C - LONG TERM OBLIGATIONS

In May 2000, the Company amended its $190.0 million credit  agreement to provide
for the  Company to make a $10.0  million  advance to its  parent  company,  RSA
Holdings  Corporation,  for  the  partial  prepayment  of its  outstanding  note
payable.  In May 2000,  the Company  borrowed  $10.0 million under its revolving
credit  facility and advanced the $10.0 million to RSA Holdings  Corporation  to
prepay a portion of its outstanding note payable.

At June 30, 2000,  the Company had  approximately  $15.0  million  available for
future borrowings under its revolving credit facility.


                                       -6-

<PAGE>



NOTE D - EARNINGS PER SHARE

The difference  between the weighted  average number of shares  outstanding  for
computing basic earnings per share and diluted earnings per share related to the
Predecessor's  employee  stock  options  outstanding  which  were  assumed to be
converted for the diluted earnings per share calculation when the average market
price of the  Predecessor's  common  stock for the period  exceeded the exercise
price of the employee stock options which were outstanding.


NOTE E - SEGMENT INFORMATION
<TABLE>
<CAPTION>

                                               Company                   Company                Predecessor
                                        ---------------------      ---------------------    ----------------------
                                              Three Months               Period from              Period from
                                                 Ended                 April 24, 1999 to        April 1, 1999 to
                                             June 30, 2000               June 30, 1999          April 23, 1999
                                        ---------------------      ----------------------   ----------------------
                                                     Operating                  Operating                Operating
                                           Net        Income          Net        Income        Net        Income
                                          Sales       (Loss)         Sales       (Loss)       Sales       (Loss)
                                        ---------   ----------     ---------   ----------   ---------   ----------
                                                                            (In Thousands)

<S>                                       <C>          <C>           <C>         <C>          <C>        <C>
Razors and Blades                         $52,840      $7,867        $40,332     $(1,861)     $10,907    $(10,639)
Cotton and Foot Care                       19,420        (364)        13,566        (151)       4,998        (169)
Custom Bar Soap                             7,661         517          6,044         712        1,399        (129)
                                          -------     -------        -------    --------      -------    --------
                                          $79,921       8,020        $59,942      (1,300)     $17,304     (10,937)
                                          =======                    =======                  =======
Interest expense                                        4,839                      3,972                      877
                                                      -------                   --------                 --------
Income (loss) before income taxes
   and extraordinary item                              $3,181                    $(5,272)                $(11,814)
                                                       ======                    =======                 ========
</TABLE>

<TABLE>
<CAPTION>


                                                                              Company               Predecessor
                                                                   -----------------------    ---------------------
                                                                          Six Months               Period from
                                                                            Ended              January 1, 1999 to
                                                                         June 30, 2000           April 23, 1999
                                                                   -----------------------    ---------------------
                                                                                Operating                 Operating
                                                                       Net       Income         Net        Income
                                                                    Sales        (Loss)        Sales       (Loss)
                                                                   ---------   ----------     -------    ----------

<S>                                                                 <C>          <C>          <C>         <C>
Razors and Blades                                                   $103,308     $12,451      $55,189     $(4,673)
Cotton and Foot Care                                                  39,646        (309)      25,551         258
Custom Bar Soap                                                       14,176         398        6,851        (218)
                                                                   ---------    --------     --------     -------
                                                                    $157,130      12,540      $87,591      (4,633)
                                                                    ========                  =======
Interest expense                                                                   9,553                    3,907
                                                                                --------                  -------
Income (loss) before income taxes
   and extraordinary item                                                        $ 2,987                  $(8,540)
                                                                                 =======                  =======
</TABLE>


                                                  Total Assets
                                                  ------------
                                                 June 30, 2000
                                                 -------------

Razors and Blades                                     $312,809
Cotton and Foot Care                                    56,646
Custom Bar Soap                                         30,711
                                                      --------
                                                      $400,166
                                                      ========



                                       -7-

<PAGE>




NOTE F - CONTINGENCIES

Cotton Matter:
--------------

During 1998, the Company purchased  bleached cotton from an outside supplier for
use in its pharmaceutical coil business.  The Company converted this cotton from
incoming bales into a coil, which was shipped to its pharmaceutical customers to
be used as filler in bottles of oral dosage forms of pharmaceutical  products to
prevent  breakage.  During the period from March through  November of 1998,  the
process by which the  Company's  supplier  bleached  this  cotton was changed by
introducing  an  expanded  hydrogen  peroxide   treatment.   Subsequent  testing
indicated  varying levels of residual  hydrogen peroxide in the cotton processed
during this time period and the supplier in November  1998 reduced the levels of
residual hydrogen peroxide in its bleaching process.  The Company,  to date, has
received  complaints from a number of customers  alleging  defects in the cotton
supplied  them  during the period and  asserting  these  defects may have led to
changes  in their  products  pharmaceutical  appearance,  and with  respect to a
limited number of products, potency. No lawsuits have been filed by any of these
customers.  The Company has received written notice of claims for damages in the
aggregate amount of approximately $117.0 million. In addition, $113.0 million of
this amount is for alleged lost profits from two  customers,  which lost profits
have not been substantiated.  It is possible that additional damage claims might
be  forthcoming.  On  March  2,  1999,  at the  request  of the  Food  and  Drug
Administration,  the Company  notified all (numbering  approximately  85) of its
pharmaceutical  cotton coil  customers that it was  withdrawing  from the market
those  lots of  cotton  coil  which may  contain  elevated  levels  of  hydrogen
peroxide.

The Company has notified its supplier that, in the Company's  view, the supplier
is primarily responsible for damages, if any, that may arise out of this matter.
At this time, the Company's  supplier has agreed to be responsible  for the cost
of fiber,  bleaching and freight of returned  product,  but has not agreed to be
responsible  for any other  damages and has  expressed  an  intention  to assert
defenses to the Company's  claims.  The Company's  insurance  carriers have been
timely notified of the existence of the claim and have agreed to provide defense
in a  reservation  of rights  letter,  but are  continuing  to evaluate  whether
coverage  would apply to all  aspects of the  claims.  The Company is advised by
outside counsel that it has strong legal arguments that the aggregate  amount of
insurance  available for these claims would be sufficient to cover the magnitude
of the claims currently expressed.

The Company also has been advised by its outside counsel that it has a number of
valid  defenses  to  potential  customer  claims as well as a third  party claim
against its suppliers  for damages,  if any,  incurred by the Company.  However,
management cannot at this time make a meaningful estimate of the amount or range
of loss that could result from an unfavorable  outcome  relating to this overall
issue,  and accordingly,  there can be no assurance that the Company's  exposure
from this matter might not  potentially  exceed the combination of its insurance
coverages  and  recourse to its  suppliers.  It is therefore  possible  that the
Company's  results of  operations  or cash flows in a  particular  quarterly  or
annual  period or its financial  position  could be  significantly  or adversely
affected by an ultimate unfavorable outcome of this matter.

Other Matter:
-------------

In June  1999,  the  Company  received  notice of the filing of a lawsuit by The
Gillette Company ("Gillette") asserting claims for damages and injunctive relief
for  alleged  patent  infringement,   misappropriation  of  trade  dress,  false
advertising  and breach of  contract in  connection  with the  marketing  of the
Company's  two-bladed and three- bladed shaving  cartridge  systems (the MBC(TM)
introduced in 1994 and the  Tri-Flexxx(TM)  introduced in 1999). In August 1999,
the  Company  filed an answer and  counterclaims  in which it denied  Gillette's
allegations, sought a declaration that Gillette's patents are not infringed, are
invalid and  unenforceable,  and  asserted  counterclaims  against  Gillette for
damages  and  injunctive  relief  for,  among other  things,  alleged  antitrust
violations and false  advertising.  Gillette's  time to respond to the Company's
answer  and  counterclaims   has  been  postponed  pending  ongoing   settlement
discussions.  The Company believes that Gillette's  claims are without merit and
intends to defend against them vigorously,  as well as to vigorously  pursue the
Company's  counterclaims  against Gillette.  The Company does not believe it has
any  material  liability  with respect to  Gillette's  claims  described  above.
However,  management  and  counsel at this time are unable to make a  meaningful
estimate of the amount or range of loss that could  result  from an  unfavorable
outcome  relating to this matter.  The Company will  reassess this matter as new
facts become available.


                                       -8-

<PAGE>




NOTE G - ADOPTION OF STOCK INCENTIVE PLAN

In June 2000, RSA Holdings  Corporation,  the Company's parent,  adopted a stock
incentive plan, whereby stock options may be granted to directors,  officers and
other key employees of RSA Holdings Corporation and its subsidiaries to purchase
a specified  number of shares of common stock for a term not to exceed 10 years.
The plan  provides for the granting of options to purchase up to 110,000  shares
of common stock of RSA Holdings  Corporation.  Grants of options to be issued to
directors, officers and other key employees vest and become exercisable upon the
attainment  of  certain  performance  goals  at the end of  certain  performance
periods, as defined in the plan or after nine years.

At June 30, 2000,  there were 95,500  stock  options  outstanding  under the RSA
Holdings Corporation stock plan.

In  accordance  with APB  Opinion  No.  25,  "Accounting  for  Stock  Issued  to
Employees,"  the Company has  accounted  for the  provisions of the RSA Holdings
Corporation stock plan in its consolidated  financial  statements.  Accordingly,
because the exercise price of the stock options equaled the fair market value of
the  underlying  stock on the  measurement  date,  no  compensation  expense was
recognized.


NOTE H - NEW ACCOUNTING STANDARDS

In June 1998,  the  Financial  Accounting  Standards  Board (the "FASB")  issued
Statement of Financial  Accounting Standards No. 133, "Accounting for Derivative
Instruments and Hedging  Activities" ("FAS 133"). FAS 133 establishes  standards
for accounting and disclosure of derivative  instruments.  This new standard, as
amended by FAS 137 and FAS 138, is effective for fiscal quarters of fiscal years
beginning  after June 15,  2000.  The  Company is  required  to adopt FAS 133 on
January 1, 2001. The implementation of this new standard is not expected to have
a material effect on the Company's results of operations or financial position.

In March 2000,  the FASB  issued FASB  Interpretation  No. 44,  "Accounting  for
Certain  Transactions  Involving Stock  Compensation",  an interpretation of APB
Opinion No. 25,  "Accounting for Stock Issued to Employees." The  Interpretation
clarifies  guidance  for  certain  issues that arose in the  application  of APB
Opinion No. 25. The Company is required to adopt the  Interpretation  on July 1,
2000. The implementation of this new standard is not expected to have a material
effect on the Company's results of operations or financial position.

In December 1999, the Securities and Exchange Commission issued Staff Accounting
Bulletin (SAB) No. 101, "Revenue Recognition in Financial  Statements".  SAB No.
101 provides additional guidance relating to revenue recognition. The Company is
required to adopt SAB No. 101, as amended by SAB No. 101A and SAB No.  101B,  in
the fourth quarter of 2000 and is currently  assessing the impact,  if any, that
SAB No.  101 may  have on the  Company's  results  of  operations  or  financial
position.



                                       -9-

<PAGE>




NOTE I - SUPPLEMENTAL GUARANTOR FINANCIAL INFORMATION

The  Company's  $69.3 million of 9 7/8% Series B Senior Notes due 2005 have been
guaranteed, on a joint and several basis by certain domestic subsidiaries of the
Company, which guarantees are senior unsecured obligations of each guarantor and
will rank pari passu in right of  payment  with all other  indebtedness  of each
guarantor.  However,  the guarantee of one of the guarantor  subsidiaries  ranks
junior to its outstanding subordinated note.

The following condensed  consolidating  financial information presents condensed
consolidating  financial  statements  as of June 30, 2000 and  December 31, 1999
(the  Company),  for the six months ended June 30, 2000 (the  Company),  for the
period from April 24, 1999 to June 30,  1999 (the  Company),  and for the period
from January 1, 1999 to April 23, 1999  (Predecessor)  of American  Safety Razor
Company - the parent company, the guarantor  subsidiaries (on a combined basis),
the non-guarantor  subsidiaries (on a combined basis),  and elimination  entries
necessary to combine such entities on a consolidated  basis.  Separate financial
statements and other disclosures  concerning the guarantor  subsidiaries are not
presented  because  management has determined that such information would not be
material to the holders of the 9 7/8% Series B Senior Notes.

                                      -10-

<PAGE>



               Condensed Consolidating Balance Sheets (Unaudited)

                                  June 30, 2000
<TABLE>
<CAPTION>


                                                                            Company
                                                 -----------------------------------------------------------------
                                                                              Non-
                                                               Guarantor    guarantor
                                                     ASR     Subsidiaries Subsidiaries  Eliminations  Consolidated
                                                  ---------  ------------ ------------  ------------  ------------
                                                                         (In thousands)
<S>                                               <C>            <C>          <C>         <C>            <C>
Assets
Current assets:
   Cash and cash equivalents                       $    124      $ 1,612      $ 2,040     $       -      $  3,776
   Accounts receivable, net                          21,305       10,265       16,042          (332)       47,280
   Advances receivable--subsidiaries                 72,490            -            -       (72,490)            -
   Inventories                                       32,146       15,796       13,486          (609)       60,819
   Income taxes and prepaid expenses                  6,180        2,513          447             -         9,140
                                                   --------      -------      -------     ---------      --------

     Total current assets                           132,245       30,186       32,015       (73,431)      121,015

Property and equipment, net                          58,491       24,399        6,893             -        89,783
Intangible assets, net                              135,951       22,496        5,035             -       163,482
Prepaid pension cost and other                       17,110        8,756           20             -        25,886
Investment in subsidiaries                           32,588            -        7,171       (39,759)            -
                                                   --------      -------      -------     ---------      --------
     Total assets                                  $376,385      $85,837      $51,134     $(113,190)     $400,166
                                                   ========      =======      =======     =========      ========

Liabilities and Stockholders' Equity
Current liabilities:
   Accounts payable, accrued expenses
     and other                                     $ 22,064     $  9,892      $ 5,847     $      (4)     $ 37,799
   Advances payable--subsidiaries                     7,633       48,339       17,455       (73,427)            -
   Current maturities of long-term obligations        9,946           99           25             -        10,070
                                                   --------      -------      -------     ---------      --------

     Total current liabilities                       39,643       58,330       23,327       (73,431)       47,869

Long-term obligations                               179,992          134            -             -       180,126
Retiree benefits and other                           17,007       10,655            -             -        27,662
Deferred income taxes                                19,679        4,448          324             -        24,451
                                                   --------      -------      -------     ---------      --------

     Total liabilities                              256,321       73,567       23,651       (73,431)      280,108
                                                   --------      -------      -------     ---------      --------

Stockholders' equity
   Common stock                                         121            -            -             -           121
   Additional paid-in capital                       172,843       12,948       23,736       (36,684)      172,843
   Advances to RSA Holdings Corporation, net        (52,383)           -            -             -       (52,383)
   Retained earnings (accumulated deficit)              334         (678)       4,604        (3,926)          334
   Accumulated other comprehensive loss                (851)           -         (857)          851          (857)
                                                   --------      -------      -------     ---------      --------
                                                    120,064       12,270       27,483       (39,759)      120,058
                                                   --------      -------      -------     ---------      --------
     Total liabilities and stockholders' equity    $376,385      $85,837      $51,134     $(113,190)     $400,166
                                                   ========      =======      =======     =========      ========

</TABLE>


                                      -11-

<PAGE>



                     Condensed Consolidating Balance Sheets

                                December 31, 1999
<TABLE>
<CAPTION>


                                                                            Company
                                                  ----------------------------------------------------------------
                                                                              Non-
                                                               Guarantor    guarantor
                                                      ASR    Subsidiaries Subsidiaries  Eliminations  Consolidated
                                                  ---------  ------------ ------------  ------------  ------------
                                                                         (In thousands)
<S>                                                <C>           <C>          <C>         <C>            <C>
Assets
Current assets:
   Cash and cash equivalents                       $  6,221      $ 1,180      $ 5,081     $      18      $ 12,500
   Accounts receivable, net                          19,927       12,906       13,751          (332)       46,252
   Advances receivable--subsidiaries                 59,790            -            -       (59,790)            -
   Inventories                                       29,825       13,322       11,947          (690)       54,404
   Income taxes and prepaid expenses                  6,511        1,912          273             -         8,696
                                                   --------      -------      -------     ---------      --------

     Total current assets                           122,274       29,320       31,052       (60,794)      121,852

Property and equipment, net                          58,005       24,731        7,255             -        89,991
Intangible assets, net                              138,404       22,994        5,103             -       166,501
Prepaid pension cost and other                       16,133        8,373           21             -        24,527
Investment in subsidiaries                           32,506            -        8,587       (41,093)            -
                                                   --------      -------      -------     ---------      --------
     Total assets                                  $367,322      $85,418      $52,018     $(101,887)     $402,871
                                                   ========      =======      =======     =========      ========

Liabilities and Stockholders' Equity
Current liabilities:
   Accounts payable, accrued expenses
     and other                                    $  19,299      $10,830      $ 6,714   $        (1)    $  36,842
   Advances payable--subsidiaries                         -       44,289       16,504       (60,793)            -
   Current maturities of long-term obligations        7,964        1,417        1,127             -        10,508
                                                   --------      -------      -------     ---------      --------

     Total current liabilities                       27,263       56,536       24,345       (60,794)       47,350

Long-term obligations                               174,954          154            -             -       175,108
Retiree benefits and other                           16,750       10,583            -             -        27,333
Deferred income taxes                                19,353        4,392          333             -        24,078
                                                   --------      -------      -------     ---------      --------

     Total liabilities                              238,320       71,665       24,678       (60,794)      273,869
                                                   --------      -------      -------     ---------      --------

Stockholders' equity
   Common stock                                         121          485           87          (572)          121
   Additional paid-in capital                       172,843       12,463       23,391       (35,854)      172,843
   Advances to RSA Holdings Corporation, net        (42,714)           -            -             -       (42,714)
   Retained earnings (accumulated deficit)           (1,258)         805        3,852        (4,657)       (1,258)
   Accumulated other comprehensive
     income                                              10            -           10           (10)           10
                                                   --------      -------      -------     ---------      --------
                                                    129,002       13,753       27,340       (41,093)      129,002
                                                   --------      -------      -------    ----------      --------
     Total liabilities and stockholders' equity    $367,322      $85,418      $52,018     $(101,887)     $402,871
                                                   ========      =======      =======     =========      ========

</TABLE>

                                      -12-

<PAGE>




          Condensed Consolidating Statements of Operations (Unaudited)

                         Six Months Ended June 30, 2000
<TABLE>
<CAPTION>


                                                                             Company
                                                   ---------------------------------------------------------------
                                                                              Non-
                                                               Guarantor    guarantor
                                                      ASR    Subsidiaries Subsidiaries  Eliminations  Consolidated
                                                   --------  ------------ ------------  ------------  ------------
                                                                         (In thousands)

<S>                                                 <C>          <C>          <C>          <C>           <C>
Net sales                                           $82,276      $54,284      $33,506      $(12,936)     $157,130
Cost of sales                                        46,888       46,253       25,015       (12,936)      105,220
                                                    -------      -------      -------      --------      --------

Gross profit                                         35,388        8,031        8,491             -        51,910

Selling, general and
     administrative expenses                         23,625        7,442        5,941             -        37,008
Amortization of intangible assets                     1,796          498           68             -         2,362
                                                    -------      -------      -------      --------      --------

Operating income                                      9,967           91        2,482             -        12,540

Other income (expense):
     Equity in earnings (losses) of affiliates          685            -       (1,416)          731             -
     Interest expense                                (8,333)      (2,297)       1,077             -        (9,553)
                                                    -------      -------      -------      --------      --------

Income (loss) before income taxes                     2,319       (2,206)       2,143           731         2,987
Income taxes (benefit)                                  727         (723)       1,391             -         1,395
                                                    -------      -------      -------      --------      --------

Net income (loss)                                   $ 1,592      $(1,483)     $   752      $    731      $  1,592
                                                    =======      =======      =======      -=======      ========
</TABLE>

                                      -13-

<PAGE>




            Condensed Consolidating Statements of Income (Unaudited)
               For the Period from April 24, 1999 to June 30, 1999
                                 (In thousands)
<TABLE>
<CAPTION>


                                                                             Company
                                                    --------------------------------------------------------------
                                                                              Non-
                                                               Guarantor    guarantor
                                                      ASR    Subsidiaries Subsidiaries  Eliminations  Consolidated
                                                    -------  ------------ ------------  ------------  ------------

<S>                                                 <C>          <C>          <C>           <C>           <C>
Net sales                                           $32,902      $19,729      $11,751       $(4,440)      $59,942
Cost of sales:
     Other costs                                     17,452       16,358        8,815        (4,440)       38,185
     Purchase accounting adjustment
        to inventory                                  7,910          215          883             -         9,008
                                                    -------      -------      -------       -------       -------

Gross profit                                          7,540        3,156        2,053             -        12,749

Selling, general and
     administrative expenses                          8,898        2,287        1,945             -        13,130
Amortization of intangible assets                       676          236            7             -           919
                                                    -------      -------      -------       -------       -------

Operating income (loss)                              (2,034)         633          101             -        (1,300)

Operating income (expense):
     Equity in earnings (losses) of affiliates          286            -         (484)          198             -
     Interest expense                                (3,561)        (764)         353             -        (3,972)
                                                    -------      -------      -------       -------       -------
Income (loss) before income taxes
     and extraordinary item                          (5,309)        (131)         (30)          198        (5,272)
Income taxes (benefit)                               (1,584)         (16)          53             -        (1,547)
                                                    -------      -------      -------       -------       -------

Income (loss) before extraordinary item              (3,725)        (115)         (83)          198        (3,725)
Extraordinary item                                      611            -            -             -           611
                                                    -------      -------      -------       -------       -------

Net income (loss)                                   $(4,336)     $  (115)     $   (83)      $   198       $(4,336)
                                                    =======      =======      =======       =======       =======
</TABLE>



                                      -14-

<PAGE>




            Condensed Consolidating Statements of Income (Unaudited)
              For the Period from January 1, 1999 to April 23, 1999
                                 (In thousands)
<TABLE>
<CAPTION>


                                                                            Predecessor
                                                   ----------------------------------------------------------------
                                                                              Non-
                                                               Guarantor    guarantor
                                                      ASR    Subsidiaries Subsidiaries  Eliminations  Consolidated
                                                    -------  ------------ ------------  ------------  ------------


<S>                                                 <C>          <C>          <C>           <C>           <C>
Net sales                                           $46,889      $32,731      $17,136       $(9,165)      $87,591
Cost of sales                                        26,237       28,514       12,934        (9,165)       58,520
                                                    -------      -------      -------       -------       -------

Gross profit                                         20,652        4,217        4,202             -        29,071

Selling, general and
     administrative expenses                         13,665        3,860        3,904             -        21,429
Amortization of intangible assets                       470          318           47             -           835
Transaction expenses                                 11,440            -            -             -        11,440
                                                    -------      -------      -------       -------       -------

Operating income (loss)                              (4,923)          39          251             -        (4,633)

Operating income (expense):
     Equity in earnings of affiliates                  (135)           -         (394)          529             -
     Interest expense                                (3,193)      (1,300)         586             -        (3,907)
                                                    -------      -------      -------       -------       -------
Income (loss) before income taxes
     and extraordinary item                          (8,251)      (1,261)         443           529        (8,540)
Income taxes (benefit)                                 (553)        (570)         281             -          (842)
                                                    -------      -------      -------       -------       -------

Income (loss) before extraordinary item              (7,698)        (691)         162           529        (7,698)
Extraordinary item                                      118            -            -             -           118
                                                    -------      -------      -------       -------       -------

Net income (loss)                                   $(7,816)    $   (691)    $    162       $   529       $(7,816)
                                                    =======     ========     ========       =======       =======

</TABLE>

                                      -15-

<PAGE>



     Condensed Consolidating Statements of Comprehensive Income (Unaudited)

                         Six Months Ended June 30, 2000
<TABLE>
<CAPTION>



                                                                             Company
                                                    --------------------------------------------------------------
                                                                              Non-
                                                               Guarantor    guarantor
                                                      ASR    Subsidiaries Subsidiaries  Eliminations  Consolidated
                                                    -------  ------------ ------------  ------------  ------------
                                                                         (In thousands)

<S>                                                  <C>         <C>            <C>          <C>           <C>
Net income (loss)                                    $1,592      $(1,483)       $ 752        $  731        $1,592
Other comprehensive loss:
   Foreign currency translation adjustments            (861)           -         (867)          861          (867)
                                                     ------      -------       ------        ------        ------
Comprehensive income (loss)                          $  731      $(1,483)       $(115)       $1,592        $  725
                                                     ======      =======        =====        ======        ======
</TABLE>



     Condensed Consolidating Statements of Comprehensive Income (Unaudited)
               For the Period from April 24, 1999 to June 30, 1999
                                 (In thousands)
<TABLE>
<CAPTION>


                                                                            Company
                                                   ---------------------------------------------------------------
                                                                              Non-
                                                               Guarantor    guarantor
                                                      ASR    Subsidiaries Subsidiaries  Eliminations  Consolidated
                                                   --------- ------------ ------------  ------------  ------------
                                                                         (In thousands)

<S>                                                 <C>            <C>         <C>              <C>       <C>
Net income (loss)                                   $(4,336)       $(115)       $ (83)          $198      $(4,336)
Other comprehensive loss:
   Foreign currency translation adjustments               -            -         (313)             3         (310)
                                                    -------        -----        -----           ----      -------
Comprehensive income (loss)                         $(4,336)       $(115)       $(396)          $201      $(4,646)
                                                    =======        =====        =====           ====      =======
</TABLE>


     Condensed Consolidating Statements of Comprehensive Income (Unaudited)
              For the Period from January 1, 1999 to April 23, 1999
                                 (In thousands)
<TABLE>
<CAPTION>


                                                                           Predecessor
                                                   ---------------------------------------------------------------
                                                                              Non-
                                                               Guarantor    guarantor
                                                      ASR    Subsidiaries Subsidiaries  Eliminations  Consolidated
                                                   --------- ------------ ------------  ------------  ------------
                                                                         (In thousands)


<S>                                                 <C>            <C>           <C>            <C>       <C>
Net income (loss)                                   $(7,816)       $(691)        $162           $529      $(7,816)
Other comprehensive loss:
   Foreign currency translation adjustments               -            -         (116)             -         (116)
                                                    -------        -----         ----           ----      -------
Comprehensive income (loss)                         $(7,816)       $(691)        $ 46           $529      $(7,932)
                                                    =======        =====         ====           ====      =======

</TABLE>

                                      -16-

<PAGE>



          Condensed Consolidating Statements of Cash Flows (Unaudited)

                         Six Months Ended June 30, 2000

<TABLE>
<CAPTION>

                                                                            Company
                                                    --------------------------------------------------------------
                                                                              Non-
                                                               Guarantor    guarantor
                                                      ASR    Subsidiaries Subsidiaries  Eliminations  Consolidated
                                                    -------  ------------ ------------  ------------  ------------
                                                                         (In thousands)
<S>                                                  <C>         <C>          <C>            <C>           <C>
Operating activities
Net cash provided by (used in)
     operating activities                            $6,434      $(1,064)     $(2,571)       $  (18)       $2,781

Investing activities
Capital expenditures                                 (4,776)      (1,186)        (385)            -        (6,347)
Advances from (to) subsidiaries                      (5,067)           -            -         5,067             -
                                                     ------      -------      -------        ------        ------

Net cash used in investing activities                (9,843)      (1,186)        (385)        5,067        (6,347)

Financing activities
Repayment of long-term obligations                   (2,980)      (1,368)      (1,102)            -        (5,450)
Proceeds from borrowings                             10,000            -            -             -        10,000
Deferred loan fees                                      (39)           -            -             -           (39)
Advances to parent                                   (9,669)           -            -             -        (9,669)
Advances from (to) subsidiaries                           -        4,050        1,017        (5,067)            -
                                                     ------       ------       ------        ------        ------

Net cash (used in) provided by
     financing activities                            (2,688)       2,682          (85)       (5,067)       (5,158)

Net (decrease) increase in cash and cash
   equivalents                                       (6,097)         432       (3,041)          (18)       (8,724)
Cash and cash equivalents, beginning of
   period                                             6,221        1,180        5,081            18        12,500
                                                     ------       ------       ------        ------        ------
Cash and cash equivalents, end of
   period`                                           $  124       $1,612       $2,040        $    -        $3,776
                                                     ======       ======       ======        ======        ======
</TABLE>

                                      -17-

<PAGE>



          Condensed Consolidating Statements of Cash Flows (Unaudited)

               For the Period from April 24, 1999 to June 30, 1999

                                 (In thousands)
<TABLE>
<CAPTION>

                                                                            Company
                                                    --------------------------------------------------------------
                                                                              Non-
                                                               Guarantor    guarantor
                                                      ASR    Subsidiaries Subsidiaries  Eliminations  Consolidated
                                                    -------  ------------ ------------  ------------  ------------
<S>                                                  <C>           <C>         <C>           <C>           <C>
Operating activities
Net cash provided by (used in)
     operating activities                            $2,341        $(892)      $  941        $   38        $2,428

Investing activities
Capital expenditures                                 (1,132)        (206)         (16)           -         (1,354)
Other                                                   (34)           -           36            -              2
Advances from (to) subsidiaries                      (1,587)           -         (641)        2,228             -
                                                     ------      -------       ------         -----       -------

     Net cash used in investing activities           (2,753)        (206)        (621)        2,228        (1,352)

Financing activities
Repayment of long-term obligations                  (32,209)      (1,280)        (304)            -       (33,793)
Proceeds from borrowings                             32,801            -            -             -        32,801
Advances from (to) subsidiaries                           -        2,266            -        (2,266)            -
                                                    -------        -----        -----        ------       -------

     Net cash provided by (used in)
          financing activities                          592          986         (304)       (2,266)         (992)

Net increase (decrease) in cash and cash
   equivalents                                          180         (112)          16             -            84
Cash and cash equivalents, beginning of
  period                                               (173)         297        2,138             -         2,262
                                                     ------        -----       ------        ------        ------
     Cash and cash equivalents, end of
        period                                       $    7        $ 185       $2,154        $    -        $2,346
                                                     ======        =====       ======        ======        ======

</TABLE>


                                      -18-

<PAGE>



          Condensed Consolidating Statements of Cash Flows (Unaudited)

              For the Period from January 1, 1999 to April 23, 1999

                                 (In thousands)
<TABLE>
<CAPTION>

                                                                            Predecessor
                                                    --------------------------------------------------------------
                                                                               Non-
                                                               Guarantor    guarantor
                                                      ASR    Subsidiaries Subsidiaries  Eliminations  Consolidated
                                                    -------- ------------ ------------  ------------  ------------
<S>                                                 <C>           <C>         <C>           <C>           <C>
Operating activities
Net cash (used in) provided by
     operating activities                           $(7,976)      $1,545       $  124        $  973       $(5,334)

Investing activities
Capital expenditures                                 (2,538)        (824)        (276)            -        (3,638)
Other                                                    49            -            -             -            49
Advances from (to) subsidiaries                       2,132            -         (691)       (1,441)            -
                                                     ------       ------       ------        ------       -------

     Net cash used in investing activities             (357)        (824)        (967)       (1,441)       (3,589)

Financing activities
Repayment of long-term obligations                  (25,401)         (62)        (383)            -       (25,846)
Proceeds from borrowings                             65,337            -            -             -        65,337
Deferred loan fees                                   (7,606)           -            -             -        (7,606)
Proceeds from exercise of stock options                   2            -            -             -             2
Advances to parent, net                             (24,155)           -            -             -       (24,155)
Advances from (to) subsidiaries                           -         (468)           -           468             -
                                                     ------       ------       ------        ------       -------

     Net cash provided by (used in)
          financing activities                        8,177         (530)        (383)          468         7,732

Net (decrease) increase in cash and cash
   equivalents                                         (156)         191       (1,226)            -        (1,191)
Cash and cash equivalents, beginning of
  period                                                (17)         106        3,364             -         3,453
                                                     ------       ------       ------        ------        ------
     Cash and cash equivalents, end of
        period                                       $ (173)      $  297       $2,138        $    -        $2,262
                                                     ======       ======       ======        ======        ======
</TABLE>

                                      -19-

<PAGE>




                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS

General

The  following  discussion  and analysis of financial  condition  and results of
operations is based upon and should be read in conjunction with the consolidated
financial  statements of the Company and notes  thereto  included in this Report
and the Registrant's  Annual Report on Form 10-K for the year ended December 31,
1999. Additionally,  management has prepared pro forma results of operations for
the three and six months ended June 30, 1999 to enable a  meaningful  comparison
between  2000 and 1999 results of  operations.  Accordingly,  see "Three  Months
Ended June 30, 2000  Compared to Pro Forma Three  Months Ended June 30, 1999 and
Six Months  Ended June 30, 2000  Compared to Pro Forma Six Months Ended June 30,
1999" discussions  below, which compare the three and six months ended June, 30,
1999 on a pro  forma  basis  assuming  the  acquisition  and  related  financing
transactions  had  occurred on April 1, 1999 and January 1, 1999,  respectively,
with 2000 actual results for a more meaningful comparison of operations.


Forward-Looking Statements

Management's  discussion  and  analysis of  financial  condition  and results of
operations  and  other   sections  of  this  Report   contain   "forward-looking
statements"  within the meaning of Section 27A of the Securities Act of 1933 and
Section  21E of  the  Securities  Exchange  Act  of  1934.  We  intend  for  the
forward-looking  statements  to be covered  by the safe  harbor  provisions  for
forward-looking  statements  in these  sections.  All  statements  regarding the
Company's  expected  financial  position,   business  and  financing  plans  are
forward-looking  statements.  Such forward-looking  statements are identified by
use  of  forward-looking  words  such  as  "anticipates,"  "believes,"  "plans,"
"estimates," "expects," and "intends" or words or phrases of similar expression.
These forward-looking  statements are subject to various assumptions,  risks and
uncertainties,  including but not limited to,  changes in political and economic
conditions,  demand for the  Company's  products,  acceptance  of new  products,
technology  developments affecting the Company's products and to those discussed
in  the  Company's   filings  with  the  Securities  and  Exchange   Commission.
Accordingly,  actual results could differ materially from those  contemplated by
the forward-looking statements.


Pro Forma  Condensed  Consolidated  Statement of Operations for the Three Months
Ended June 30, 1999

The following unaudited pro forma condensed consolidated statement of operations
has been prepared by management from the historical  financial statements of the
Predecessor  for the  period  from  April 1,  1999 to April  23,  1999,  and the
historical  financial  statements  of the  Company for the period from April 24,
1999 to June 30, 1999. The acquisition,  and the related financing transactions,
are  assumed  to have  occurred  on  April  1,  1999.  The pro  forma  condensed
consolidated  statement of operations  for the three months ended June 30, 1999,
is not  necessarily  indicative  of the  results of  operations  that would have
occurred  for the three  months ended June 30,  1999,  had the  acquisition  and
relating financing transactions occurred on April 1, 1999. In preparation of the
pro forma condensed  consolidated  statement of operations,  management has made
certain  estimates  and  assumptions  that  affect the  amounts  reported in the
unaudited  pro  forma  condensed  consolidated  statement  of  operations.   The
unaudited pro forma condensed consolidated statement of operations for the three
months ended June 30, 1999,  should be read in  conjunction  with the historical
financial statements and related notes thereto of the Company which are included
in this Form 10-Q and in the  Company's  Annual Report on Form 10-K for the year
ended December 31, 1999.


                                      -20-

<PAGE>



   Unaudited Pro Forma Condensed Consolidated Statement of Operations for the
                        Three Months Ended June 30, 1999
                                 (In Thousands)
<TABLE>
<CAPTION>



                                       Predecessor                    Predecessor     Company
                                       Historical                    Pro Forma       Historical                       Company
                                       Period from                  Period From     Period From                      Pro Forma
                                      April 1, 1999                  April 1, 1999  April 24, 1999                  Three Months
                                      to April  23,     Pro Forma    to April 23,    to June 30,      Pro Forma         Ended
                                          1999         Adjustments       1999          1999          Adjustments    June 30, 1999
                                      -------------   -----------   --------------- --------------   ------------   ------------

<S>                                        <C>           <C>           <C>           <C>            <C>               <C>
Net sales                                  $17,304                    $ 17,304       $59,942          $     -        $ 77,246
Cost of sales:
   Cost of sales                            11,691       $    94 (a)    11,785        38,185                -          49,970
   Purchase accounting adjustment
      to inventory                               -         3,453 (b)     3,453         9,008           (3,453)(b)       9,008
                                           -------       -------      --------       -------           ------        --------

  Gross profit                              5,613        (3,547)        2,066        12,749            3,453          18,268

Selling, general and administrative
   expenses                                  4,922            14 (c)     4,936        13,130                -          18,066
Amortization of intangible assets              188           118 (d)       306           919                -           1,225
Transaction expenses                        11,440             -        11,440             -                -          11,440
                                           -------       -------      --------       -------           ------        --------

   Operating loss                          (10,937)       (3,679)      (14,616)       (1,300)           3,453         (12,463)

Interest expense                               877           406 (e)     1,283         3,972             (138)(g)       5,117
                                           -------       -------      --------       -------           ------        --------

   Loss before income taxes
      and extraordinary item               (11,814)       (4,085)      (15,899)       (5,272)           3,591         (17,580)

Income taxes (benefit)                      (2,142)       (1,653)(f)    (3,795)       (1,547)           1,426 (f)      (3,916)
                                           -------       -------      --------       -------           ------        --------

   Loss before
      extraordinary item                   $(9,672)      $(2,432)     $(12,104)      $(3,725)          $2,165        $(13,664)
                                           =======       =======      ========       =======           ======        ========
</TABLE>


(a) Adjustment  to provide pro forma  depreciation  expense  resulting  from the
    application  of  purchase  accounting  adjustments  computed  based  on  the
    remaining useful lives of plant and equipment.

(b) Adjustment  to reflect the impact on cost of sales of  additional  inventory
    costs resulting from adjusting the carrying value of acquired inventories to
    reflect their estimated fair market value assuming the acquisition  occurred
    on April 1, 1999.

(c) Adjustment to reflect the elimination of amortization of unrecognized  prior
    service cost and unrecognized gains related to the Predecessor's pension and
    postretirement benefit plans.

(d) Adjustment to reflect the  elimination  of $159 of  amortization  related to
    historical  goodwill  and record pro forma  amortization  of $277 related to
    intangible  assets  including  goodwill,  trademarks and patents recorded in
    connection with the acquisition. Goodwill and trademarks are being amortized
    over a 40-year  useful life and patents are being  amortized  over a 15-year
    useful life. These periods are believed by management to be reasonable based
    on the expected lives of the underlying processes,  products,  and equipment
    assumed to be acquired.

(e) Adjustment to reflect (i) the elimination of historical  interest expense of
    $108 related to the Predecessor's  credit facilities,  loan commitment fees,
    and  the  amortization  of  deferred   financing   costs,   (ii)  pro  forma
    amortization  of $72 for the $8,001 in deferred  financing costs incurred in
    connection  with the financing,  amortized over the respective  lives of the
    Company's credit facilities, and (iii) pro forma interest expense of $442 on
    the  Company's  credit  facilities  related  to the  balances  assumed to be
    outstanding on April 1, 1999.  Interest  expense has been computed  assuming
    that the  LIBOR-based  interest rate (plus the applicable  margin) option is
    selected by the  Company.  Balances  assumed to be  outstanding  on April 1,
    1999,  include $5,000 under the revolving  credit facility and $88,000 under
    the Term Loan Facility. In addition, the purchase of

                                      -21-

<PAGE>



    $30,700 in Senior Notes on June 10,  1999,  was assumed to occur on April 1,
    1999.

(f) Adjustment  to  reflect  the  income  tax  consequences  of  the  pro  forma
    adjustments  computed  at the  statutory  rate of  39.7%  excluding  the net
    adjustment for goodwill of $80 which is not tax deductible.

(g) Adjustment  to reflect pro forma  interest  expense of $261 on the Company's
    credit facilities related to the balances assumed to be outstanding on April
    24, 1999.  Interest expense has been computed  assuming that the LIBOR-based
    interest  rate  (plus  the  applicable  margin)  option is  selected  by the
    Company.  Balances assumed to be outstanding on April 24, 1999, are the same
    as described in (e) above.  Adjustment to reflect pro forma interest expense
    reduction  of $399  related to the  $30,700,000  in Senior  Notes which were
    assumed to be purchased on April 24, 1999.


Three Months  Ended June 30, 2000  Compared to Pro Forma Three Months Ended June
30, 1999

Net Sales.  Net sales for the three months ended June 30, 2000,  and for the pro
forma three months ended June 30, 1999,  were $79.9  million and $77.2  million,
respectively, an increase of $2.7 million, or 3.5%.

Razors and  Blades.  Net sales of our razors  and blades  segment  for the three
months  ended June 30,  2000,  and for the pro forma three months ended June 30,
1999,  were $52.8 million and $51.2 million,  respectively,  an increase of $1.6
million or 3.1%.

Net sales of shaving razors and blades for the three months ended June 30, 2000,
and for the pro forma three months ended June 30, 1999,  were $35.3  million and
$32.8 million,  respectively, an increase of $2.5 million, or 7.4%. Net sales of
domestic value branded shaving products decreased 13.3%. Net sales for the three
months  ended  June 30,  1999,  were  favorably  affected  by the  launch of the
Tri-Flexxx shaving product and by sales of the Revlon Perfect Finish(TM) shaving
system which was  discontinued in September 1999. The decrease in domestic value
branded  shaving  products  net sales also  reflects  a decline  in  promotional
programs  and  inventory  reductions  by a key  customer.  Net sales of domestic
private label shaving products  increased 5.0% primarily  reflecting sales gains
relating to the Tri-Flexxx and Premier  Comfort shaving  products.  Net sales of
shaving products in international  markets increased 28.0% (net of a 6% negative
impact of unfavorable  exchange rates) reflecting  stronger sales in most of the
Company's markets.

Net sales of blades and bladed  hand tools for the three  months  ended June 30,
2000, and for the pro forma three months ended June 30, 1999, were $13.3 million
and $14.2  million,  respectively,  a decrease  of $0.9  million,  or 5.8%.  The
decrease primarily reflects the timing of seasonal promotional volume.

Net sales of specialty  industrial and medical blades for the three months ended
June 30, 2000,  and for the pro forma three  months  ended June 30,  1999,  were
unchanged at $4.2 million.

Cotton and Foot Care.  Net sales of cotton and foot care  products for the three
months  ended June 30,  2000,  and for the pro forma three months ended June 30,
1999,  were $19.4 million and $18.6 million,  respectively,  an increase of $0.8
million or 4.6%. The increase results  primarily from an increase in promotional
programs  with  several  customers  which was somewhat  offset by reduced  sales
resulting  from  issues  related to the cotton  coil  matter  (see Note F to the
condensed consolidated financial statements).

Custom Bar Soap.  Net sales of the  Company's  custom bar soap  products for the
three months ended June 30, 2000,  and for the pro forma three months ended June
30, 1999, were $7.7 million and $7.4 million,  respectively, an increase of $0.3
million or 2.9%. The increase  results  primarily from increased sales volume to
several of the Company's skin care and specialty customers.

Gross Profit.  Gross profit  increased  $8.2 million to $26.5 million during the
three  months ended June 30,  2000,  from $18.3  million for the pro forma three
months ended June 30, 1999 due primarily to the purchase  accounting  adjustment
to inventory of $9.0 million for the pro forma three months ended June 30, 1999.
As a percentage of net sales,  gross profit was 33.2% for the three months ended
June 30,  2000,  and 23.6% for the pro forma three  months  ended June 30, 1999.
Excluding the 1999 purchase accounting  adjustment to inventory of $9.0 million,
gross profit  decreased $0.8 million to $26.5 million for the three months ended
June 30, 2000, from $27.3 million

                                      -22-

<PAGE>



for the pro forma three months ended June 30, 1999,  and as a percentage  of net
sales,  gross profit was 33.2% for the three  months  ended June 30,  2000,  and
35.3% for the pro forma three months ended June 30, 1999. Blade margins declined
due primarily to product mix, higher material costs, higher depreciation expense
related  to  capacity  expansion  projects  and  from  the  negative  impact  of
unfavorable  exchange  rates,  primarily the Euro.  Cotton margins  declined due
primarily to product mix and higher manufacturing overheads.

Operating and Other Expenses.  Selling, general and administrative expenses were
21.7% of net sales for the three months  ended June 30, 2000,  compared to 23.4%
for the pro forma three  months  ended June 30,  1999.  The  decrease  primarily
reflects a decrease in promotional spending for our shaving blade products which
was somewhat offset by an increase in product  development costs and an increase
in marketing and administrative overhead associated with the new management team
and the new  corporate  headquarters.  Amortization  of  intangible  assets  was
substantially  unchanged  at $1.2  million for the three  months  ended June 30,
2000,  and the pro forma three  months  ended June 30,  1999.  Interest  expense
decreased $0.3 million to $4.8 million for the three months ended June 30, 2000,
from $5.1  million  for the pro forma  three  months  ended June 30,  1999,  due
primarily to lower commitment fee expense relating to the permanent reduction in
the amount of available  borrowings  under the  Company's  term loan facility of
$52.5 million in July 1999. The decrease was  substantially  offset by increased
interest  expense  resulting from additional  debt and  amortization of deferred
loan fees incurred in connection  with the  acquisition,  additional  borrowings
under the Company's revolving credit facility and an increase in interest rates.

In connection with the 1999 acquisition the Predecessor  incurred  approximately
$11.4 million in transaction  expenses related  primarily to (i) amounts paid to
redeem  all  of  the  outstanding  options  to  purchase  common  stock  of  the
Predecessor,  (ii)  costs  incurred  by or  on  behalf  of  the  Predecessor  in
connection  with the  acquisition,  including legal and other advisory fees, and
(iii) costs incurred by or on behalf of the Predecessor related to payments made
to  certain  employees  of the  Predecessor  in  connection  with the  change of
control.

Costs of $0.7 million (net of tax benefit)  associated with the 1999 purchase of
the Senior Notes and repayment of the terminated  credit  facility are reflected
in the consolidated statement of operations as an extraordinary item.

The  Company's  effective  income tax rate was 46.7% for the three  months ended
June 30,  2000,  versus  (22.3)% for the pro forma three  months  ended June 30,
1999,  and  varies  from the  United  States  statutory  rate due  primarily  to
nondeductible goodwill amortization,  certain nondeductible transaction expenses
in 1999 and state income taxes, net of the federal tax benefit.


Pro Forma  Condensed  Consolidated  Statement of  Operations  for the Six Months
Ended June 30, 1999

The following unaudited pro forma condensed consolidated statement of operations
has been prepared by management from the historical  financial statements of the
Predecessor  for the  period  from  January 1, 1999 to April 23,  1999,  and the
historical  financial  statements  of the  Company for the period from April 24,
1999 to June 30, 1999. The acquisition,  and the related financing transactions,
are  assumed  to have  occurred  on January  1,  1999.  The pro forma  condensed
consolidated  statement of operations for the six months ended June 30, 1999, is
not necessarily indicative of the results of operations that would have occurred
for the six  months  ended  June 30,  1999,  had the  acquisition  and  relating
financing  transactions  occurred on January 1, 1999. In  preparation of the pro
forma  condensed  consolidated  statement  of  operations,  management  has made
certain  estimates  and  assumptions  that  affect the  amounts  reported in the
unaudited  pro  forma  condensed  consolidated  statement  of  operations.   The
unaudited pro forma condensed  consolidated  statement of operations for the six
months ended June 30, 1999,  should be read in  conjunction  with the historical
financial statements and related notes thereto of the Company which are included
in this Form 10-Q and in the  Company's  Annual Report on Form 10-K for the year
ended December 31, 1999.


                                      -23-

<PAGE>



   Unaudited Pro Forma Condensed Consolidated Statement of Operations for the
                         Six Months Ended June 30, 1999
                                 (In Thousands)
<TABLE>
<CAPTION>



                                        Predecessor                    Predecessor       Company
                                        Historical                      Pro Forma       Historical                     Company
                                       Period from                     Period From     Period From                    Pro Forma
                                    January 1, 1999                  January 1,1999  April 24,1999                   Six Months
                                      to April  23,     Pro Forma        April 23,       to June 30,  Pro Forma        Ended
                                           1999        Adjustments         1999          1999        Adjustments   June 30, 1999
                                    ---------------   -----------    ---------------  -------------- -----------   -------------

<S>                                         <C>            <C>              <C>             <C>         <C>             <C>
Net sales                                   $87,591                         $87,591         $59,942     $      -        $147,533
Cost of sales:
   Cost of sales                             58,520        $  460 (a)        58,980          38,185            -          97,165
   Purchase accounting adjustment
      to inventory                                -         9,008 (b)         9,008           9,008       (9,008)(b)       9,008
                                          ---------       -------          --------         -------       ------       ---------

   Gross profit                              29,071        (9,468)           19,603          12,749        9,008          41,360

Selling, general and administrative
   expenses                                  21,429            68 (c)        21,497          13,130            -          34,627
Amortization of intangible assets               835           638 (d)         1,473             919            -           2,392
Transaction expenses                         11,440             -            11,440               -            -          11,440
                                            -------        ------          --------       ---------     --------        --------

   Operating loss                            (4,633)      (10,174)          (14,807)         (1,300)       9,008          (7,099)

Interest expense                              3,907         2,030 (e)         5,937           3,972         (138)(g)       9,771
                                           --------        ------          --------         -------      -------       ---------

   Loss before income taxes
      and extraordinary item                 (8,540)      (12,204)          (20,744)         (5,272)       9,146         (16,870)

Income taxes (benefit)                         (842)       (4,666)(f)        (5,508)         (1,547)       3,631 (f)      (3,424)
                                           --------       -------           -------         -------       ------       ---------

   Loss before
      extraordinary item                    $(7,698)      $(7,538)         $(15,236)        $(3,725)      $5,515        $(13,446)
                                            =======       =======          ========         =======       ======        ========
</TABLE>


(a) Adjustment  to provide pro forma  depreciation  expense  resulting  from the
    application  of  purchase  accounting  adjustments  computed  based  on  the
    remaining useful lives of plant and equipment.

(b) Adjustment  to reflect the impact on cost of sales of  additional  inventory
    costs resulting from adjusting the carrying value of acquired inventories to
    reflect their estimated fair market value assuming the acquisition  occurred
    on January 1, 1999.

(c) Adjustment to reflect the elimination of amortization of unrecognized  prior
    service cost and unrecognized gains related to the Predecessor's pension and
    postretirement benefit plans.

(d) Adjustment to reflect the  elimination  of $705 of  amortization  related to
    historical  goodwill and record pro forma  amortization of $1,343 related to
    intangible  assets  including  goodwill,  trademarks and patents recorded in
    connection with the acquisition. Goodwill and trademarks are being amortized
    over a 40-year  useful life and patents are being  amortized  over a 15-year
    useful life. These periods are believed by management to be reasonable based
    on the expected lives of the underlying processes,  products,  and equipment
    assumed to be acquired.

(e) Adjustment to reflect (i) the elimination of historical  interest expense of
    $494 related to the Predecessor's  credit facilities,  loan commitment fees,
    and  the  amortization  of  deferred   financing   costs,   (ii)  pro  forma
    amortization of $353 for the $8,001 in deferred  financing costs incurred in
    connection  with the financing,  amortized over the respective  lives of the
    Company's credit facilities,  and (iii) pro forma interest expense of $2,171
    on the Company's  credit  facilities  related to the balances  assumed to be
    outstanding on January 1, 1999.  Interest expense has been computed assuming
    that the  LIBOR-based  interest rate (plus the applicable  margin) option is
    selected by the Company.  Balances  assumed to be  outstanding on January 1,
    1999,  include $5,000 under the revolving  credit facility and $88,000 under
    the Term Loan Facility. In addition, the purchase

                                      -24-

<PAGE>



    of $30,700 in Senior Notes on June 10, 1999, was assumed to occur on January
    1, 1999.

(f) Adjustment  to  reflect  the  income  tax  consequences  of  the  pro  forma
    adjustments  computed  at the  statutory  rate of  39.7%  excluding  the net
    adjustment for goodwill of $451 which is not tax deductible.

(g) Adjustment  to reflect pro forma  interest  expense of $261 on the Company's
    credit facilities related to the balances assumed to be outstanding on April
    24, 1999.  Interest expense has been computed  assuming that the LIBOR-based
    interest  rate  (plus  the  applicable  margin)  option is  selected  by the
    Company.  Balances assumed to be outstanding on April 24, 1999, are the same
    as described in (e) above.  Adjustment to reflect pro forma interest expense
    reduction  of $399  related to the  $30,700,000  in Senior  Notes which were
    assumed to be purchased on April 24, 1999.


Six Months  Ended June 30, 2000  Compared to Pro Forma Six Months Ended June 30,
1999

Net Sales.  Net sales for the six months  ended June 30,  2000,  and for the pro
forma six months ended June 30, 1999,  were $157.1  million and $147.5  million,
respectively, an increase of $9.6 million, or 6.5%.

Razors and Blades. Net sales of our razors and blades segment for the six months
ended June 30, 2000, and for the pro forma six months ended June 30, 1999,  were
$103.3 million and $95.5 million,  respectively, an increase of $7.8 million, or
8.2%.

Net sales of shaving  razors and blades for the six months  ended June 30, 2000,
and for the pro forma six months  ended June 30,  1999,  were $69.7  million and
$61.9 million, respectively, an increase of $7.8 million, or 12.6%. Net sales of
domestic value branded  shaving  products  decreased 4.5%. Net sales for the six
months  ended June 30,  1999,  were  favorably  affected  by sales of the Revlon
Perfect  Finish(TM) shaving system which was discontinued in September 1999. The
decrease in domestic  value branded  shaving  products net sales also reflects a
decline in promotional programs and inventory reductions by a key customer.  Net
sales of domestic  private  label shaving  products  increased  12.0%  primarily
reflecting  sales gains relating to the Tri-Flexxx and Premier  Comfort  shaving
products. Net sales of shaving products in international markets increased 28.2%
(net of a 5% negative impact of unfavorable  exchange rates) reflecting stronger
sales in most of the Company's markets.

Net sales of blades  and bladed  hand  tools for the six  months  ended June 30,
2000,  and for the pro forma six months ended June 30, 1999,  were $25.5 million
and $25.7  million,  respectively,  a decrease  of $0.2  million,  or 1.0%.  The
decrease primarily reflects the timing of seasonal promotional volume. Excluding
this impact, core volume increased 3.2%.

Net sales of specialty  industrial  and medical  blades for the six months ended
June 30, 2000,  and for the pro forma six months ended June 30, 1999,  were $8.1
million and $7.9 million,  respectively,  an increase of $0.2 million,  or 3.3%.
Sales of specialty  industrial  products increased 9.0% reflecting  distribution
gains. Sales of medical products were substantially unchanged.

Cotton and Foot Care.  Net sales of cotton  and foot care  products  for the six
months  ended June 30,  2000,  and for the pro forma six  months  ended June 30,
1999,  were $39.6 million and $39.1 million,  respectively,  an increase of $0.5
million or 1.4%. The increase results  primarily from an increase in promotional
programs  with  several  customers  which was somewhat  offset by reduced  sales
resulting  from  issues  related to the cotton  coil  matter  (see Note F to the
condensed consolidated financial statements).

Custom Bar Soap. Net sales of the Company's custom bar soap products for the six
months  ended June 30,  2000,  and for the pro forma six  months  ended June 30,
1999,  were $14.2 million and $12.9 million,  respectively,  an increase of $1.3
million or 9.9%. The increase  results  primarily from increased sales volume to
several of the Company's skin care and specialty customers.

Gross Profit.  Gross profit increased $10.5 million to $51.9 million for the six
months  ended June 30,  2000,  from $41.4  million  for the pro forma six months
ended June 30, 1999 due  primarily  to the  purchase  accounting  adjustment  to
inventory of $9.0 million for the pro forma six months ended June 30, 1999,  and
to higher sales volume. As a percentage of net sales, gross profit was 33.0% for
the six months ended June 30, 2000, and 28.0%

                                      -25-

<PAGE>



for the pro forma six months ended June 30, 1999.  Excluding  the 1999  purchase
accounting adjustment to inventory of $9.0 million,  gross profit increased $1.5
million to $51.9  million  for the six months  ended June 30,  2000,  from $50.4
million for the pro forma six months ended June 30, 1999, and as a percentage of
net sales,  gross profit was 33.0% for the six months  ended June 30, 2000,  and
34.1% for the pro forma six months ended June 30, 1999.  Blade margins  declined
due primarily to product mix, higher material costs, higher depreciation expense
related  to  capacity  expansion  projects  and  from  the  negative  impact  of
unfavorable exchange rates, primarily the Euro.

Operating and Other Expenses.  Selling, general and administrative expenses were
23.6% of net sales for the six months ended June 30, 2000, compared to 23.5% for
the pro forma six months ended June 30, 1999. The increase primarily reflects an
increase  in legal fees  arising  from the  Gillette  lawsuit and an increase in
marketing and  administrative  overhead  associated with the new management team
and the new corporate  headquarters.  The increase was substantially offset by a
decrease in promotional spending for our shaving blade products. Amortization of
intangible assets was substantially unchanged at $2.4 million for the six months
ended  June 30,  2000,  and for the pro forma six months  ended  June 30,  1999.
Interest expense decreased $0.2 million to $9.6 million for the six months ended
June 30,  2000,  from $9.8  million for the pro forma six months  ended June 30,
1999, due primarily to lower  commitment  fee expense  relating to the permanent
reduction in the amount of available  borrowings  under the Company's  term loan
facility of $52.5 million in July 1999. The decrease was substantially offset by
increased  interest  expense  resulting from additional debt and amortization of
deferred  loan fees  incurred in  connection  with the  acquisition,  additional
borrowings  under the  Company's  revolving  credit  facility and an increase in
interest rates.

In connection with the 1999 acquisition the Predecessor  incurred  approximately
$11.4 million in transaction  expenses related  primarily to (i) amounts paid to
redeem  all  of  the  outstanding  options  to  purchase  common  stock  of  the
Predecessor,  (ii)  costs  incurred  by or  on  behalf  of  the  Predecessor  in
connection  with the  acquisition,  including legal and other advisory fees, and
(iii) costs incurred by or on behalf of the Predecessor related to payments made
to  certain  employees  of the  Predecessor  in  connection  with the  change of
control.

Costs of $0.7 million (net of tax benefit)  associated with the 1999 purchase of
the Senior Notes and repayment of the terminated  credit  facility are reflected
in the consolidated statement of operations as an extraordinary item.

The Company's  effective income tax rate was 46.7% for the six months ended June
30,  2000,  and (20.3)% for the pro forma six months  ended June 30,  1999,  and
varies from the United  States  statutory  rate due  primarily to  nondeductible
goodwill  amortization,  certain non deductible transaction expenses in 1999 and
state income taxes, net of the federal tax benefit.


Liquidity and Capital Resources

The Company's  primary  sources of liquidity are cash flow from  operations  and
borrowings under its revolving  credit facility.  Net cash provided by operating
activities  amounted to $2.8 million for the six months ended June 30, 2000. Net
cash  provided by operating  activities  amounted to $2.4 million for the period
from April 24, 1999, to June 30, 1999, and net cash used in operating activities
amounted to $5.3 million for the period from January 1, 1999, to April 23, 1999.
Net cash provided by operating activities for the six months ended June 30, 2000
primarily  reflects an increase in net income and net changes in working capital
accounts.  Net cash used in investing activities related to capital expenditures
of $6.3  million  for the six  months  ended  June 30,  2000.  Net cash  used in
financing activities resulted from $9.7 million in net advances to the Company's
parent which was somewhat  offset by $4.6 million in net  borrowings for the six
months ended June 30, 2000.

In May 2000, the Company amended its $190.0 million credit  agreement to provide
for the  Company to make a $10.0  million  advance to its  parent  company,  RSA
Holdings  Corporation,  for  the  partial  prepayment  of its  outstanding  note
payable.  In May 2000,  the Company  borrowed  $10.0 million under its revolving
credit  facility and advanced the $10.0 million to RSA Holdings  Corporation  to
prepay a portion of its outstanding note payable.

At June 30, 2000,  the Company had  approximately  $15.0  million  available for
future borrowings under its revolving credit facility.


                                      -26-

<PAGE>



Management  believes that the  Company's  cash on hand,  anticipated  funds from
operations,  and the amounts available to the Company under its revolving credit
facility  will be  sufficient  to  cover  its  working  capital  needs,  capital
expenditures  and debt  service  requirements  as well as support the  Company's
growth-oriented  strategy  for its  existing  business  for at least the next 12
months.

The Company's  ability to fund  operations,  make capital  expenditures and make
scheduled  principal  and  interest  payments  or  to  refinance  the  Company's
indebtedness will depend upon future financial and operating performance,  which
will be affected by prevailing economic  conditions and financial,  business and
other factors, some of which are beyond the Company's control.

Market Risk

The  Company is  exposed to various  market  risk  factors  such as  fluctuating
interest  rates and changes in foreign  currency  rates.  These risk factors can
impact results of  operations,  cash flows and financial  position.  The Company
manages these risks through  regular  operating  and  financing  activities  and
periodically  uses derivative  financial  instruments  such as foreign  exchange
option and forward  contracts and interest rate cap and swap  agreements.  These
derivative  instruments are placed with major financial institutions and are not
for speculative or trading purposes.

The following analysis presents the effect on the Company's earnings, cash flows
and  financial  position as if the  hypothetical  changes in market risk factors
occurred  on June 30,  2000 and June 30,  1999.  Only the  potential  impacts of
hypothetical  assumptions  are analyzed.  The analysis  does not consider  other
possible effects that could impact the business.

Interest Rate Risk

At June 30, 2000, the Company carried $190.2 million of outstanding  debt on its
balance  sheet,  with  $119.7  million of that total held at  variable  interest
rates.  The Company  has entered  into an  interest  rate cap  agreement  and an
interest rate swap  agreement with a bank covering $56.3 million of its variable
rate debt  outstanding  to manage  its  interest  rate risk.  Holding  all other
variables constant,  if interest rates hypothetically  increased or decreased by
10%,  for the six months  ended June 30, 2000 and 1999,  the impact on earnings,
cash flow and financial position would not be material. In addition, if interest
rates  hypothetically  increased or decreased by 10% on June 30, 2000,  with all
other variables held constant, the fair market value of our $69.3 million 9 7/8%
Series B Senior Notes would increase or decrease by approximately $3.5 million.

Foreign Currency Risk

The Company sells to customers in foreign markets through foreign operations and
through  export  sales  from  plants in the U.S.  These  transactions  are often
denominated  in  currencies  other than the U.S.  dollar.  The primary  currency
exposures are the Euro,  British  Pound  Sterling,  Canadian  Dollar and Mexican
Peso.

The Company  limits its foreign  currency risk by operational  means,  mostly by
locating  its   manufacturing   operations  in  those  locations  where  it  has
significant exposures to major currencies.  The Company periodically enters into
currency  option  contracts  to  partially  offset the risk of foreign  currency
fluctuations. There were no currency contracts outstanding at June 30, 2000.

Contingencies

Refer to Note F - Contingencies to the Notes to Condensed Consolidated Financial
Statements for a discussion of legal contingencies.

New Accounting Standards

In June 1998,  the  Financial  Accounting  Standards  Board (the "FASB")  issued
Statement of Financial  Accounting Standards No. 133, "Accounting for Derivative
Instruments and Hedging  Activities" ("FAS 133"). FAS 133 establishes  standards
for accounting and disclosure of derivative  instruments.  This new standard, as
amended by FAS 137 and FAS 138, is effective for fiscal quarters of fiscal years
beginning  after June 15,  2000.  The  Company is  required  to adopt FAS 133 on
January 1, 2001. The implementation of this new standard is not expected to

                                      -27-

<PAGE>



have a material  effect on the  Company's  results of  operations  or  financial
position.

In March 2000,  the FASB  issued FASB  Interpretation  No. 44,  "Accounting  for
Certain  Transactions  Involving Stock  Compensation",  an interpretation of APB
Opinion No. 25,  "Accounting for Stock Issued to Employees." The  Interpretation
clarifies  guidance  for  certain  issues that arose in the  application  of APB
Opinion No. 25. The Company is required to adopt the  Interpretation  on July 1,
2000. The implementation of this new standard is not expected to have a material
effect on the Company's results of operations or financial position.

In December 1999, the Securities and Exchange Commission issued Staff Accounting
Bulletin (SAB) No. 101, "Revenue Recognition in Financial  Statements".  SAB No.
101 provides additional guidance relating to revenue recognition. The Company is
required to adopt SAB No. 101, as amended by SAB No. 101A and SAB No.  101B,  in
the fourth quarter of 2000 and is currently  assessing the impact,  if any, that
SAB No.  101 may  have on the  Company's  results  of  operations  or  financial
position.

Inflation

Inflation has not been material to the Company's  operations  within the periods
presented.


Item 3. Quantitative and Qualitative Disclosures About Market Risk

The information  called for by this item is provided under the captions  "Market
Risk",  "Interest Rate Risk" and "Foreign  Currency Risk" under Part I, Item 2 -
Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations of this Report.


                           PART II, OTHER INFORMATION


Item 1.  Legal Proceedings

          The  information  called  for by  this  item is  provided  in Note F -
          Contingencies to Notes to Condensed  Consolidated Financial Statements
          under Part I, Item 1. - Financial Statements of this Report.


Item 6.  Exhibits and Reports on Form 8-K

          a.   Exhibits

               -    Exhibit 4.19 - Amendment No. 1 to the Credit Agreement dated
                    as  of  April  23,  1999,   among  RSA  Acquisition   Corp.,
                    ("Purchaser"),  the  Registrant  ("Borrower"),  RSA Holdings
                    Corp. of Delaware ("Holdings"), and the Initial Lenders, the
                    Swing   Line  Bank  and  the   Initial   Issuing   Bank  and
                    NationsBank, N.A. ("Administrative Agent").

               -    Exhibit  10.10 - RSA Holdings  Corp.  of Delaware 1999 Stock
                    Incentive Plan.

               -    Exhibit 27 - Financial Data Schedule.

          b.   Reports on Form 8-K: On April 20, 2000,  the  Registrant  filed a
               report on Form 8-K reporting that it had changed its  independent
               public  accountants  from  PricewaterhouseCoopers  LLP to Ernst &
               Young LLP.

                                      -28-

<PAGE>



                                   SIGNATURES





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



                                AMERICAN SAFETY RAZOR COMPANY




August 10, 2000                 By /s/James D. Murphy
-----------------                  ---------------------------------------
Date                                James D. Murphy
                                    President and Chief Executive Officer




August 10, 2000                 By /s/Alan R. Koss
-----------------                  ---------------------------------------
Date                                Alan R. Koss
                                    Senior Vice President
                                    Chief Financial Officer


                                      -29-