<PAGE>

===============================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                    --------

                                    FORM 10-Q


(Mark One)

[X]    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
       EXCHANGE ACT OF 1934
       For the quarterly period ended September 30, 2001

                                       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 333-40067


                               PLIANT CORPORATION
             (Exact name of registrant as specified in its charter)


           Utah                                       87-0496065
-----------------------------------         --------------------------------
(State or other jurisdiction of                     (I.R.S. Employer
incorporation or organization)                     Identification No.)




                      2755 E. Cottonwood Parkway, Suite 400
                           Salt Lake City, Utah 84121
                                 (801) 993-8221

          (Address of principal executive offices and 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
    -----       -----

                      APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date. On November 12, 2001, there
were 598,943 outstanding shares of the registrant's Common Stock.

===============================================================================



<PAGE>


PLIANT CORPORATION AND SUBSIDIARIES

TABLE OF CONTENTS

<TABLE>
<CAPTION>


                                                                                                  PAGE
                                                                                                  -----
<S>                                                                                               <C>
PART I. FINANCIAL INFORMATION

       ITEM 1. FINANCIAL STATEMENTS
           CONDENSED CONSOLIDATED BALANCE SHEETS AS OF SEPTEMBER 30, 2001 AND
           DECEMBER 31, 2000                                                                        3

           CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE AND NINE MONTH
           PERIODS ENDED SEPTEMBER 30, 2001 AND 2000                                                4

           CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED
           SEPTEMBER 30, 2001 AND 2000                                                              5

           CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY(DEFICIT) FOR THE
           NINE MONTHS ENDED SEPTEMBER 30, 2001                                                     6

           NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS                                 7

       ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
               RESULTS OF OPERATIONS                                                               25

       ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                          34

PART II. OTHER INFORMATION

       ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS                                           35

       ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K                                                    35
</TABLE>


                                       2
<PAGE>




PART I.  FINANCIAL INFORMATION
-------------------------------
ITEM 1.  FINANCIAL STATEMENTS

PLIANT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS
AS OF SEPTEMBER 30, 2001 AND DECEMBER 31, 2000
(DOLLARS IN THOUSANDS) (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                   September 30,        December 31,
                                                                                       2001                 2000
                                                                                   -------------        ------------
<S>                                                                                  <C>                <C>
ASSETS
CURRENT ASSETS:
     Cash and cash equivalents                                                       $    3,766         $      3,060
     Receivables, net of allowances of $4,096 and $2,166, respectively                  135,411              115,058
     Inventories                                                                         80,228               79,151
     Prepaid expenses and other                                                           3,638                1,983
     Income taxes receivable                                                                737                2,758
     Deferred income taxes                                                               12,832               12,992
                                                                                     ----------         ------------
         Total current assets                                                           236,612              215,002
PROPERTY, PLANT AND EQUIPMENT, net                                                      362,288              333,083
INTANGIBLE ASSETS, net                                                                  234,362              205,870
OTHER ASSETS                                                                             30,500               31,079
                                                                                     ----------         ------------
TOTAL ASSETS                                                                         $  863,762         $    785,034
                                                                                     ==========         ============

LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES:
     Current portion of long-term debt                                                $  15,713         $      9,362
     Trade accounts payable                                                             107,212              109,018
     Accrued liabilities                                                                 54,515               39,012
                                                                                     ----------         ------------
         Total current liabilities                                                      177,440              157,392
LONG-TERM DEBT, net of current portion                                                  686,620              678,031
OTHER LIABILITIES                                                                        19,704               17,385
DEFERRED INCOME TAXES                                                                    31,928               33,060
                                                                                     ----------         ------------
         Total liabilities                                                              915,692              894,240
                                                                                     ----------         ------------

REDEEMABLE PREFERRED STOCK - 200,000 shares authorized, 130,983 shares
     outstanding and designated as Series A, no par value, with a redemption and
     liquidation value of $1,000 per share
                                                                                        120,501               88,721
                                                                                     ----------

REDEEMABLE COMMON STOCK - no par value; 60,000 shares authorized; 53,996 shares
     outstanding as of September 30, 2001 and 57,121 outstanding  as of
     December 31, 2000, net of related stockholders' notes receivable of
     $12,875 at September 30, 2001 and $14,551 at December 31, 2000                      16,623               16,456
                                                                                     ----------         ------------
Minority Interest                                                                           357
                                                                                     ----------
STOCKHOLDERS' DEFICIT:
     Common stock - no par value; 10,000,000 shares authorized, 544,947 shares
         Outstanding at September 30, 2001 and 510,674 at December 31, 2000             104,387               87,989
     Warrants                                                                            38,852               26,500
     Accumulated deficit                                                               (320,728)            (312,414)
     Stockholders' notes receivable                                                        (605)                (825)
     Accumulated other comprehensive income                                             (11,317)              (7,261)
                                                                                     ----------         ------------
         Total stockholders' deficit                                                   (189,411)            (206,011)
                                                                                     ----------         ------------
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT                                          $  863,762         $    785,034
                                                                                     ==========         ============
</TABLE>

See notes to condensed consolidated financial statements.

                                       3
<PAGE>


PLIANT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000
(IN THOUSANDS) (UNAUDITED)
<TABLE>
<CAPTION>


                                                                  Three Months Ended                     Nine Months Ended
                                                                     September 30,                         September 30,
                                                           ----------------------------------    ----------------------------------
                                                               2001                2000               2001               2000
                                                           --------------     ---------------    ---------------     --------------

<S>                                                         <C>                <C>                <C>                 <C>
NET SALES                                                   $  220,350         $  210,795         $  626,578          $  642,895
COST OF SALES                                                  173,889            176,539            498,497             529,380
                                                           -----------         ----------         ----------          ----------
     Gross profit                                               46,461             34,256            128,081             113,515
                                                           -----------         ----------         ----------          ----------

OPERATING EXPENSES:
     Sales, General, and Administrative                         21,971             18,207             68,803              66,998
     Research and development                                    2,431              2,155              7,314               6,453
     Stock-based compensation related to
           administrative employees                                  -                  -              7,033                   -
     Compensation and transaction costs
           related to recapitalization                               -              2,405                  -               9,031
     Plant closing costs                                        (7,502)                 -             (7,502)                  -
                                                           -----------         ----------         ----------          ----------
         Total operating expenses                               16,900             22,767             75,648              82,482
                                                           -----------         ----------         ----------          ----------
OPERATING INCOME                                                29,561             11,489             52,433              31,033
INTEREST EXPENSE                                               (18,877)           (21,087)           (58,302)            (46,935)
OTHER INCOME(EXPENSE)  - Net                                       882                (25)             6,654                (183)
                                                           -----------         ----------         ----------          ----------
INCOME(LOSS) BEFORE INCOME TAXES
         AND EXTRAORDINARY LOSS                                 11,566             (9,623)               785             (16,085)
INCOME TAX PROVISION (BENEFIT)                                   4,704             (3,083)             2,851              (2,102)
                                                           -----------         ----------         ----------          ----------
INCOME(LOSS) BEFORE
         EXTRAORDINARY (LOSS)                                    6,862             (6,540)            (2,066)            (13,983)
EXTRAORDINARY (LOSS)
         (net of income taxes)                                       -                  -                  -             (11,250)
                                                           -----------         ----------         ----------          ----------
NET INCOME(LOSS)                                            $    6,862         $   (6,540)        $   (2,066)         $  (25,233)
                                                           ===========         ==========         ==========          ==========

</TABLE>


See notes to condensed consolidated financial statements.


                                       4



<PAGE>



PLIANT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE  MONTHS ENDED SEPTEMBER 30, 2001 AND 2000
(IN THOUSANDS) (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                           2001              2000
                                                                                       -----------        -----------

<S>                                                                                    <C>                <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
     Net  income(loss)                                                                $   (2,066)         $  (25,233)
     Adjustments to reconcile net loss to net cash
       provided by operating activities:
         Depreciation and amortization                                                    34,052              28,707
         Deferred income taxes                                                             1,517              (4,209)
         Reduction in provision for losses on accounts receivable                              -                (752)
         Non-cash compensation expense                                                     7,033               1,223
         (Gain)/loss on disposal of assets                                                  (349)                474
         Plant closing costs                                                              (7,502)                  -
         Extraordinary loss                                                                    -              11,250
         Changes in assets and liabilities, net of assets acquired and
         liabilities assumed :
              Receivables                                                                (12,742)                313
              Inventories                                                                  5,969                (487)
              Prepaid expenses and other                                                  (1,263)             (1,377)
              Intangible Assets and Other assets                                             974               2,181
              Trade accounts payable                                                      (9,319)             28,482
              Income taxes payable/receivable                                              2,149              (1,909)
              Accrued liabilities                                                          7,676              10,120
              Due to affiliates                                                                -              (4,715)
              Other liabilities                                                              276               4,479
                                                                                      ----------          ----------
                  Net cash provided by operating activities                               23,371              48,547
                                                                                      ----------          ----------

CASH FLOWS FROM INVESTING ACTIVITIES:
     Proceeds from sale of assets                                                          7,914                   -
     Uniplast  acquisition, net of cash                                                  (55,531)                  -
     Capital expenditures for plant and equipment                                        (40,027)            (40,080)
                                                                                      ----------          ----------
                  Net cash used in investing activities                                  (87,644)            (40,080)
                                                                                      ----------          ----------

CASH FLOWS FROM FINANCING ACTIVITIES:
     Payment of capitalized loan fees                                                     (1,932)            (21,928)
     Payment of fees from tender offer                                                         -             (10,055)
     Redemption of common stock                                                                -            (314,034)
     Net proceeds from issuance of common and preferred stock and net change
       in related common stockholders' notes receivables                                  47,636             161,255
     New borrowings/principal payments on long-term debt                                  14,940            (517,494)
     Proceeds from issuance of long term debt                                                                699,508
     Minority Investment                                                                     357                   -
                                                                                      ----------          ----------
                  Net cash provided by (used in)financing activities                      61,001              (2,748)
                                                                                      ----------          ----------

EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS                               3,978              (1,624)
                                                                                      ----------          ----------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                                         706               4,095
CASH AND CASH EQUIVALENTS, BEGINNING OF THE PERIOD                                         3,060               9,097
                                                                                      ----------          ----------
CASH AND CASH EQUIVALENTS, END OF THE PERIOD                                          $    3,766          $   13,192
                                                                                      ==========          ==========

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:

     Cash paid (received) during the period for:
         Interest                                                                     $   41,949           $  34,661
         Income taxes                                                                 $   (1,465)          $     986
     Other non-cash disclosure:
         Preferred dividends accrued but not paid                                     $   12,641           $   4,668
</TABLE>


See notes to condensed consolidated financial statements.

                                      5

<PAGE>




PLIANT CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2001
(IN THOUSANDS) (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                                       ACCUMULATED
                                       COMMON STOCK       WARRANTS                    STOCKHOLDERS'       OTHER
                                   -------------------   TO PURCHASE    ACCUMULATED       NOTES       COMPREHENSIVE
                                   SHARES      AMOUNT   COMMON STOCK      DEFICIT      RECEIVABLE        INCOME         TOTAL
                                  --------    --------  ------------    -----------  --------------   -------------  -----------
<S>                                   <C>     <C>          <C>          <C>             <C>           <C>             <C>
BALANCE, DECEMBER 31, 2000            511     $87,989      $26,500      $(312,414)      $(825)        $(7,261)        $(206,011)

Net loss                                -           -            -         (2,066)          -               -            (2,066)

Stock-based compensation
    related to administrative
    employees                           -           -            -          7,033           -               -             7,033

Fair value change in interest
   rate derivatives classified
   as cash flow hedges                  -           -            -              -           -         (3,417)            (3,417)


Preferred stock dividend and
    Accretion                           -           -            -        (13,281)          -              -            (13,281)

Issuance of stock as a result
   of Uniplast acquisition             35      16,760            -              -           -              -             16,760
Issuance of warrants with
   preferred stock as a result
   of the Uniplast acquisition          -           -       11,555              -           -              -             11,555
Issuance of warrants with
   preferred stock purchased
   by employees                         -           -          797              -           -              -                797
Repurchase of common stock and
    cancellation of notes from
    management                         (1)       (362)           -              -         251              -               (111)

Amortization of discount on
    stockholder's note receivable       -           -            -              -         (31)             -                (31)

Foreign currency transaction                                                                            (639)              (639)
    Adjustment                          -           -            -              -           -
                                      ---    --------      -------      ---------       -----       --------          ---------
BALANCE, SEPTEMBER 30, 2001           545    $104,387      $38,852      $(320,728)      $(605)      $(11,317)         $(189,411)
                                      ===    ========      =======      =========       =====       ========          =========
</TABLE>

See notes to condensed consolidated financial statements.

                                       6
<PAGE>


PLIANT CORPORATION AND SUBSIDIARIES


NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)


1.    BASIS OF PRESENTATION

      The accompanying condensed consolidated financial statements have been
      prepared, without audit, in accordance with U.S. generally accepted
      accounting principles and pursuant to the rules and regulations of the
      Securities and Exchange Commission. The information reflects all normal
      recurring adjustments that, in the opinion of management, are necessary
      for a fair presentation of the financial position, results of operations
      and cash flows of Pliant Corporation and its subsidiaries ("Pliant" or the
      "Company") as of the dates and for the periods presented. Results of
      operations for the period ended September 30, 2001 are not necessarily
      indicative of results of operations to be expected for the full fiscal
      year.

      Certain information in footnote disclosures normally included in financial
      statements presented in accordance with U.S. generally accepted accounting
      principles has been condensed or omitted in accordance with the rules and
      regulations of the Securities and Exchange Commission. These statements
      should be read in conjunction with the Company's Annual Report on Form
      10-K for the year ended December 31, 2000 and the Company's Registration
      Statement on Form S-1 (File No.333-65754). Certain reclassifications have
      been made to the condensed consolidated financial statements for the
      period ended September 30, 2000 for comparative purposes.


2.    INVENTORIES

      Inventories are valued at the lower of cost (using the first-in, first-out
      method) or market value. Inventories as of September 30, 2001 and December
      31, 2000 consisted of the following (in thousands):

      <TABLE>
      <CAPTION>

                                        September 30,            December 31,
                                             2001                      2000
                                        -------------            ------------
           <S>                              <C>                      <C>
           Finished goods                   $46,543                  $46,760
           Raw materials                     25,783                   24,158
           Work-in-process                    7,902                    8,233
                                              -----                    -----
           Total                            $80,228                  $79,151
      </TABLE>


3.    PLANT CLOSING COSTS, OTHER CLOSING COSTS AND WORKFORCE REDUCTION

    PLANT CLOSING COSTS -- During 2000, we approved and announced a strategic
initiative to cease operations at our Dallas, Texas; Birmingham, Alabama; and
Harrington, Delaware facilities. These facilities represent a portion of our
Design, Industrial and Specialty Films segments, respectively. The intent of
this initiative was to maximize the capacity of other company owned facilities
by moving the production from these locations to plants that were not operating
at capacity. As a result of this strategic initiative, we recorded a pre-tax
charge of $19.6 million which is included as part of plant closing costs in the
consolidated statement of operations for the year ended December 31, 2000. Of
the $19.6 million, $13.8 million represented a reserve for impaired plant and
equipment, $5.0 million represented a charge for severance costs and $0.8
million represented a charge for other closure costs and inventory write-offs.
The major actions relating to the exit of these facilities include closing each
of the respective facilities, disposal of the related equipment of each facility
and termination of the employees of the respective facilities. As of December
31, 2000, we had completed our closure of our Dallas facility. In addition, we
completed the closure of our Birmingham facility during the second quarter of
2001.

    We have analyzed the economics of closing our Harrington facility in light
of changes in customer demand and our recent acquisition of Uniplast. These
changes together with the movement of a production line from our Birmingham
plant have significantly improved the profitability of the Harrington plant. As
a result we have revised our plans to close that

                                       7
<PAGE>

facility. During the first six months of 2001, $1.1 million was incurred to
downsize the Harrington facility. The remaining balance of the plant closure
costs of $ 7.5 million accrued in 2000 has been credited to plant closing costs
in the statement of operations for the three and nine months ended September 30,
2001.

    The following is a summary of the remaining key elements of the 2000 exit
plan:

         <TABLE>
         <CAPTION>

                                                    DALLAS   BIRMINGHAM     TOTAL
                                                   --------  ----------   -------
         <S>                                       <C>       <C>          <C>
         Number of employees to be terminated...        68        105          173
         Book value of property and equipment to
           be Disposed of.......................    $1,593     $8,913     $ 10,506
         Estimated proceeds from disposal.......     1,200      1,749        2,949
                                                     -----      -----        -----
         Net write-off from disposal............       393      7,164        7,557
         Severance costs........................       588      2,271        2,859
         Other closure costs....................       302        225          527
                                                    ------     ------     --------
         Total closure costs....................    $1,283     $9,660     $ 10,943
                                                    ======     ======     ========
         </TABLE>

    We do not anticipate the loss of any revenues or income from the closure of
these facilities due to the fact that their respective sales volumes will be
transferred to other facilities. As of September 30, 2001, the remaining
reserves related to severance costs and other costs are included in other
accrued liabilities in the accompanying consolidated balance sheet while the
reserve for impairment of property and equipment has been recorded as a direct
reduction of the net property and equipment balances. Utilization of the
reserves remaining as of September 30, 2001 is summarized below:

         <TABLE>
         <CAPTION>
                                                            UTILIZED
                                             BALANCE    ----------------                BALANCE
                                             12/31/00   NON-CASH    CASH    REVERSAL    9/30/01
                                             --------   --------  -------   --------   --------
         <S>                                 <C>         <C>      <C>        <C>       <C>
         Property and equipment reserves..   $ 13,801    $4,689   $   --     $ 6,244   $ 2,868
         Severance costs..................      4,371        --    3,091       1,088       192
         Other costs......................        585        --      123         170       292
                                             --------    ------   ------     -------   -------
         Total............................   $ 18,757    $4,689   $3,214     $ 7,502   $ 3,352
                                             ========    ======   ======     =======   =======
         </TABLE>

    As of September 30, 2001, 68 and 104 of the expected employee terminations
had been completed at our Dallas and Birmingham facilities, respectively. As of
September 30, 2001, all planned employee terminations have been completed at the
Harrington facility. There are no reserves remaining for the Harrington facility
closure as of September 30, 2001.

    OFFICE CLOSING COSTS AND WORKFORCE REDUCTION -- During the fourth quarter
2000, we approved and announced a cost saving initiative resulting in a
company-wide workforce reduction, relocation of the corporate office from Salt
Lake City, Utah to the Chicago, Illinois area and closure of the Dallas, Texas
divisional office. As a result of this initiative we recorded a pre-tax charge
of $7.1 million which is included as part of administration and other expenses
in the accompanying consolidated statements of operations. The major actions
relating to this initiative included a reduction in workforce due to
consolidation of duties, and closing the offices in Dallas, Texas and Salt Lake
City, Utah. We completed the workforce reduction of 52 employees and the closure
of the office in Dallas, Texas during the first quarter 2001, as well as the
Salt Lake City office closure during the second quarter 2001. The following is a
summary of the key elements of this plan:

         <TABLE>
         <CAPTION>
                                                    RELOCATION      CLOSURE
                                      WORKFORCE    OF CORPORATE    OF DALLAS
                                      REDUCTION       OFFICE         OFFICE       TOTAL
                                     -----------   ------------    ----------     ------
         <S>                           <C>             <C>             <C>         <C>
         Number of employees......           52            36            2           90
         Leasehold improvements...                     $1,000                    $1,000
         Severance cost...........      $ 2,940         2,352        $  21        5,313
         Other costs related to
         leases...................                        721           82          803
                                        -------        ------        -----       ------
         Total cost...............      $ 2,940        $4,073        $ 103       $7,116
                                        =======        ======        =====       ======
         </TABLE>

    As of September 30, 2001, the remaining reserves related to severance costs
and other costs related to leases are included in other accrued liabilities in
the accompanying condensed consolidated balance sheet while the reserve for
impairment related to leasehold improvements has been recorded as a reduction of
the net property and equipment balance. Utilization of these reserves during the
period ended September 30, 2001 is summarized below:

         <TABLE>
         <CAPTION>
                                                          UTILIZED
                                          BALANCE    -----------------    BALANCE
                                          12/31/00   NON-CASH    CASH     9/30/01
                                          --------   --------   -------  --------
         <S>                               <C>        <C>       <C>       <C>
         Leasehold improvements.........   $1,000         -           -   $ 1,000
         Severance cost.................    3,254         -     $ 2,684       570
         Other costs related to leases..      803         -         388       415
                                           ------     -----     -------   -------
          Total cost....................   $5,057     $   -     $ 3,072   $ 1,985
                                           ======     =====     =======   =======
         </TABLE>

    As of September 30, 2001, 52, 34 and 2 of the expected employee terminations
had been completed of the workforce


                                       8
<PAGE>

reduction, closure of the Salt Lake City and the closure of the Dallas offices
respectively.

4.    REDEEMABLE COMMON STOCK

      Under the May 2000 stock purchase agreements, we have repurchase rights,
      which allow us to repurchase certain shares from the employees, if the
      individuals cease to be employees for any reason. The repurchase rights
      lapse as follows: (1) one-sixth on January 1, 2001, so long as the
      recipient is still our employee on such date and (2) the remainder in
      equal increments over a five-year period commencing on December 31, 2000
      as follows: (a) in full if 100% or more of the applicable target market
      value of equity is achieved as of the end of the applicable calendar year
      and (b) partial, if more than 90% of the applicable target market value of
      equity is achieved or (c) if the target market value of equity is not
      achieved, in full on December 31, 2009. The repurchase rights terminate in
      the event of certain acceleration events as defined in the agreement. The
      repurchase price per share is the original price paid by the employee plus
      interest compounded annually at 7% commencing on the 181st day after the
      date of termination of the employee through the date on which the shares
      are actually repurchased.

      In addition, under employment agreements, additional repurchase rights and
      put options were established. The repurchase rights allow the Company to
      repurchase shares, not already subject to the May 2000 stock purchase
      agreement repurchase rights, from the employee in the event of termination
      for any reason. The put options allow for the employees to require the
      Company to purchase all of the shares in the event of resignation for good
      reason, death, disability or retirement, subject to the restrictive
      provisions of any credit or other agreements. However, the put option
      related to 32,750 shares, in no event can be exercised until January 1,
      2006. The price under the repurchase rights and the put options is the
      fair market value of the common stock, as determined in good faith.

      On December 27, 2000, we entered into a severance agreement with an
      employee. Under the agreement, we cancelled approximately $133,000 of
      accrued interest on a note receivable. We repurchased 6,211 shares of
      restricted stock for $483.13 per share and offset the purchase price
      against $3.0 million of note principal. In addition, on January 2, 2001,
      we repurchased an additional 539 shares of restricted stock for $483.13
      per share and offset the purchase price against $260,000 of note
      principal. The Company's repurchase rights were changed on the remaining
      7,423 shares of common stock owned by this individual, whereby the Company
      agreed not to repurchase the shares until February 28, 2003 at a
      repurchase price of the greater of the fair market value and $111.53 per
      share. Interest ceased to accrue on the remaining $787,000 balance of the
      note related to the sale of stock in 1999. Further, the put option was
      cancelled. As a result of these modifications, a $323,000 discount on the
      note receivable balance was recorded as compensation expense in 2000. The
      discount will be amortized to interest income over the remaining term of
      the note. In the event we determine to repurchase the stock from this
      individual at an amount that is: (1) greater than the fair value of the
      stock (i.e. the note balance is greater than the fair value) or (2)
      greater than the note balance as a result of future increases in fair
      value of the stock, we will record additional expense.

      On January 22, 2001, we entered into a severance agreement with another
      employee. Under this agreement, we cancelled approximately $85,000 of
      accrued interest on a note receivable. We repurchased 3,125 shares of
      restricted stock for $483.13 and offset the purchase price against $1.5
      million of note principal. We further agreed to cease interest on the
      remaining $302,000 principal balance of the note receivable related to 625
      shares and to cease interest on the $262,000 principal balance related to
      the sale of stock in 1999. As a result of these interest modifications, a
      $208,000 discount on the note receivable balance was recorded as
      compensation expense in the first quarter of 2001. The discount will be
      amortized to interest income over the remaining term of the note. In
      addition, the Company's repurchase rights and the individual's put option
      were changed on the remaining 2,832 shares of common stock owned by this
      individual. We agreed not to repurchase and the individual agreed not to
      exercise the put option on the shares until February 28, 2003. The
      repurchase price and the put option price were changed to be the greater
      of the fair value of the stock or the balance on the note receivable.
      Because the fair value of these shares was $483.13 per share on January
      22, 2001, compensation expense of approximately $1.0 million was recorded
      in the first quarter of 2001, which

                                       9
<PAGE>

      represents the difference between the carrying amount and the fair value
      of the 2,622 shares common stock that are subject to the note receivable.

      On February 1, 2001, we amended the note agreements with another employee
      that was issued in connection with the sale of restricted stock in 1999
      and 2000. Under the amended agreements, interest ceases to accrue,
      effective December 31, 2000, on one note with a principal balance of $1.6
      million and another note with a principal balance of $7.0 million.
      Further, the notes were modified to remove the full recourse provisions
      and modify the pledge agreement. As a result of these modifications, the
      sale of stock for notes will now be accounted for as stock options and
      will be subject to variable accounting. Accordingly, changes in the fair
      value of the common stock in excess of the note balance will be recorded
      as compensation expense until the note is paid in full. In addition,
      interest income will not be recorded on these notes. In connection with
      this modification we recorded compensation expense of $6.0 million, in the
      first quarter of 2001.

      Because of the modifications of these employee notes, in the first quarter
      of 2001 another employee's 2000 stock purchase will be accounted for as
      stock options, subject to variable accounting. In addition, interest
      income will not be recorded on this note with a principal balance of $3.7
      million.


5.    STOCK OPTION PLANS

      During the three and nine month periods ended September 30, 2001, options
      to purchase 1,600 and 11,780 shares, respectively, at $483.13 per share
      were granted to employees. These options vest over five (5) years. During
      the same periods, options to purchase 90 and 4,342 shares, respectively,
      were forfeited due to employee terminations.


6.    OPERATING LEASES

      In March 2001 we completed a sale and leaseback of certain equipment and
      received proceeds of $7.9 million. There was no gain or loss in connection
      with the sale and the lease is accounted for as an operating lease. As
      part of the transaction we issued a $3.4 million letter of credit for
      which the lessor is the beneficiary should we default on any payments. The
      monthly lease payments are $139,967 for 72 months.


7.    DERIVATIVE INSTRUMENTS

      Effective January 1, 2001, we adopted SFAS No. 133, "Accounting for
      Derivative Instruments and Hedging Activities", as amended by SFAS No. 137
      and SFAS No. 138. We recognize the fair value of derivatives as either
      assets or liabilities in the balance sheet. To the extent that the
      derivatives qualify as hedges, gains or losses associated with the
      effective portion are recorded as a component of other comprehensive
      income while the ineffective portion is recognized in income.

      At the adoption of this pronouncement, we had one interest rate cap
      agreement, which had been entered into during the fourth quarter of 2000.
      As a result, the initial adoption of this pronouncement did not result in
      a material effect to our financial statements.

      During the first quarter of 2001, we entered into three additional
      interest rate derivative agreements with separate financial institutions.
      We use our interest rate derivatives to manage interest rate risk
      associated with future interest payments on variable rate borrowings under
      our Credit Facilities. Our interest rate derivative agreements are
      considered cash flow hedges and consisted of the following as of September
      30, 2001 (dollars in millions):


                                       10
<PAGE>

     <TABLE>
     <CAPTION>

                                    Notional        Variable              Fixed               Maturity
           Type                      Amount          Rate*               Rate **               Dates
      ----------------------        ---------       --------          -------------         -----------
      <S>                             <C>            <C>              <C>                    <C>
      Interest rate cap               $128.0         LIBOR               10.00%              12/31/2003
      Interest rate cap                 30.0         LIBOR                7.25%              02/09/2004
      Interest rate collar              40.0         LIBOR            4.15% - 7.25%          02/13/2004
      Interest rate swap                60.0         LIBOR                5.40%              02/13/2004
     </TABLE>

      --------------
      * Three-month LIBOR, as defined; 2.59% as of September 28, 2001
     ** Strike for caps; floor and strike for collar

      The fair value of our interest rate derivative agreements is reported on
      our consolidated balance sheet at September 30, 2001 in other liabilities
      of approximately $3,425,518 and in other assets of approximately $33,000.


8.    OTHER INCOME

      Other Income for the nine months ended September 30, 2001 includes the
      proceeds and assets received from a settlement with a potential new
      customer and other less significant items.


9.    MINORITY  INTEREST

      During the third quarter of 2001, the Company signed a joint venture
      agreement with Supreme Plastics Group PLC for the production and marketing
      of plastic zippers. Each joint venture partner contributed $375,000 in
      cash. The profits and losses will be shared equally. The Company will
      consolidate the results of the joint venture and account for the minority
      interest as a reduction from pretax income. The results of the joint
      venture for the third quarter ended September 30, 2001 was not
      significant.


10.   RECENT ACCOUNTING PRONOUNCEMENT

      In July 2001 the Financial Accounting Standards Board (FASB) issued SFAS
      No. 141 "Business Combinations" and SFAS No. 142 "Goodwill and Other
      Intangible Assets". SFAS No. 141 requires business combinations initiated
      after June 30, 2001 to be accounted for using the purchase method of
      accounting, and broadens the criteria for recording intangible assets
      separate from goodwill. Recorded goodwill and intangibles will be
      evaluated against this new criteria and may result in certain intangibles
      being subsumed into goodwill, or alternatively, amounts initially recorded
      as goodwill may be separately identified and recognized apart from
      goodwill. SFAS 142 requires the use of a non-amortization approach to
      account for all purchased goodwill and certain intangible assets. Under a
      non-amortization approach, goodwill and certain intangible assets will not
      be amortized into results of operations, but instead would be reviewed for
      impairment and written down and charged to results of operations only in
      periods in which the recorded value of goodwill and certain intangible
      assets is more than its fair value. The provisions of SFAS 141 and SFAS
      142 which apply to goodwill and intangible assets acquired prior to June
      30, 2001 will be adopted by the Company on January 1, 2002. We expect that
      the adoption of these accounting standards will have the impact of
      reducing amortization of goodwill and certain intangible assets.


10.   ACQUISITIONS

                                      11
<PAGE>


      On July 16, 2001, we acquired 100% of the outstanding stock of Uniplast
      Holdings, Inc. ( "Uniplast") for approximately $57.1 million, consisting
      of the assumption of approximately $40.3 million of debt and the issuance
      of shares of our common stock valued at approximately $16.8 million to the
      selling shareholders of Uniplast (of which 3,468 shares valued at
      approximately $1.7 million are subject to certain holdback arrangements
      and had not been delivered at closing). We believe that this acquisition
      resulted in significant synergies to the combined operations and increased
      the market share in a number of market segments. At the closing of the
      acquisition, we refinanced approximately $37.0 million of assumed debt
      with the proceeds from a private placement of 29,000 of preferred stock at
      $ 1,000 per share and borrowings under our revolving credit facility. In
      connection with the Uniplast acquisition, we entered into an amendment of
      our credit facilities and incurred amendment fees of $1.4 million. In
      addition, we also issued 1,983 shares of our preferred stock at $1,000 per
      share, together with warrants to purchase 2,013 shares of common stock, to
      certain employees of the Company. We also incurred $0.9 million of legal
      and administrative expenses. We recorded $14.4 million as intangible
      assets and $ 19.3 million as goodwill as a result of this acquisition. The
      intangible assets are being amortized over 15 years while the goodwill is
      not being amortized. The operating results for Uniplast from July 16, 2001
      is included in the statements of operations for the periods ended
      September 30, 2001.

      The purchase price of $ 56.8 million was allocated to assets and
      liabilities as follows:

     <TABLE>
     <CAPTION>
                                                           (in millions)
                                                           -------------
     <S>                                                       <C>
     Current Assets                                             $  18.5

     Property Plant and Equipment                                  20.6

     Intangible Assets                                             14.4

     Goodwill                                                      19.3

     Current Liabilities                                          (13.7)

     Long-term Liabilities                                         (2.0)
                                                               --------
     Total  Purchase Price                                     $   57.1
                                                               ========
     </TABLE>


 11.  OPERATING SEGMENTS

      Operating segments are components of the Company for which separate
      financial information is available that is evaluated regularly by our
      chief operating decision maker in deciding how to allocate resources and
      in assessing performance. This information is reported on the same basis
      that is used internally for evaluating segment performance.

      We have three reportable operating segments: specialty films, design
      products and industrial films. The specialty films segment produces
      converter films that are sold to other flexible packaging manufacturers
      for additional fabrication, barrier films used to package and protect food
      and other products, and other films used in the personal care, medical and
      agriculture industries. The design products segment produces printed
      rollstock, bags and sheets used to package products in the food and other
      industries. The industrial films segment produces stretch films, used for
      industrial unitizing and containerization, and PVC films, used to wrap
      meat, cheese and produce.

      Sales and transfers between our segments are eliminated in consolidation.
      We evaluate performance of the operating segments based on profit or loss
      before income taxes, not including nonrecurring gains or losses. Our
      reportable segments are managed separately with separate management teams,
      because each segment has different products, customer requirements,
      technology and marketing strategies. During the first quarter of 2001, two
      plant operations were reclassified from our Specialty segment to our
      Industrial segment in accordance with a change in business focus.
      Accordingly, the 2000 amounts have been

                                       12

<PAGE>

      reclassified to reflect this change. In addition, certain operating
      expenses were reclassified from our segments to the corporate category as
      a result of expenses which are no longer attributable and allocated to the
      segment.

Segment profit or loss and segment assets as of and for the three months ended
September 30, 2001 and 2000 are presented in the following table (in thousands):


     <TABLE>
     <CAPTION>


                                           SPECIALTY     DESIGN       INDUSTRIAL     CORPORATE
                                             FILMS      PRODUCTS         FILMS        /OTHER           TOTAL
                                           ---------    ---------     ----------     ----------      ---------
       <S>                                  <C>          <C>           <C>            <C>            <C>
       SEPTEMBER 30, 2001
       Net sales to customers               $105,414      $52,058       $62,878        $     -        $220,350
       Inter-segment sales                     1,171          763         1,836         (3,770)              -
                                            --------      -------       -------        --------       --------
       Total net sales                       106,585       52,821        64,714         (3,770)        220,350
       Depreciation and amortization           3,250        3,009         2,122          3,944          12,325
       Interest expense                           44          638           (51)        18,246          18,877
       Segment profit (loss)                  23,071        7,788        12,465        (31,758)         11,566
       Segment total assets                  442,374      181,280       130,755        109,353         863,762
       Capital expenditures                    7,308        2,006           900            726          10,940

       SEPTEMBER 30, 2000
       Net sales to customers                 93,445       55,650        61,700              -         210,795
       Inter-segment sales                     1,764          878         1,492         (4,134)              -
                                            --------      -------       -------        --------       --------
       Total net sales                        95,209       56,528        63,192         (4,134)        210,795
       Depreciation and amortization           2,822        2,262         1,861          2,714           9,659
       Interest expense                            7          902            89         20,089          21,087
       Segment profit (loss)                  15,180        7,021         8,356        (40,180)         (9,623)
       Segment total assets                  407,235      177,510       131,798         90,972         807,515
       Capital expenditures                    3,505        4,782         2,239          4,369          14,895

     </TABLE>

                                       13

<PAGE>


Segment profit or loss and segment assets as of and for the nine months ended
September 30, 2001 and 2000 are presented in the following table (in thousands):


     <TABLE>
     <CAPTION>



                                           SPECIALTY     DESIGN       INDUSTRIAL     CORPORATE
                                             FILMS      PRODUCTS         FILMS        /OTHER           TOTAL
                                           ---------    ---------     ----------     ----------      ---------
       <S>                                 <C>          <C>           <C>            <C>             <C>
       SEPTEMBER 30, 2001
       Net sales to customers               $281,040     $160,940      $184,598       $      -        $626,578
       Inter-segment sales                     5,304        3,829         4,714        (13,847)              -
                                            --------     --------      --------       --------        --------
       Total net sales                       286,344      164,769       189,312        (13,847)        626,578
       Depreciation and amortization           9,001        8,380         6,035         10,636          34,052
       Interest expense                           56        2,371          (109)        55,984          58,302
       Segment profit (loss)                  61,867       28,667        32,928       (122,677)            785
       Capital expenditures                   20,087       10,017         5,399          4,524          40,027


       SEPTEMBER 30, 2000
       Net sales to customers                298,692      161,799       182,404              -         642,895
       Inter-segment sales                     4,927        3,655         5,224        (13,806)              -
                                            --------     --------      --------       --------        --------
       Total net sales                       303,619      165,454       187,628        (13,806)        642,895
       Depreciation and amortization           8,376        6,699         5,610          8,022          28,707
       Interest expense                           19        2,681           263         43,972          46,935
       Segment profit (loss)                  56,002       18,748        26,875       (117,710)        (16,085)
       Capital expenditures                   14,496        8,986         8,275          8,323          40,080
     </TABLE>



                                       14


<PAGE>


A reconciliation of the totals reported for the operating segments to our totals
reported in the consolidated condensed financial statements is as follows (in
thousands):

<TABLE>
<CAPTION>

                                                                  Three months ended
                                                                    September 30,
                                                              --------------------------
                                                               2001                2000
                                                              ------              ------
    <S>                                                      <C>                 <C>
    PROFIT OR LOSS

    Total segment profit for reportable segments             $43,324             $ 30,557
                                                             -------              -------
    Unallocated Corporate expenses                           (21,014)             (17,686)
    Compensation and transaction costs related
         to recapitalization                                       -               (2,405)
    Plant closing costs                                        7,502                    -
    Interest expense                                         (18,246)             (20,089)
                                                             -------              -------
          Total Corporate/Other                              (31,758)             (40,180)
                                                            --------              -------
    Income (loss) before income taxes                        $11,566             $ (9,623)
                                                             =======             ========
</TABLE>












                                       15
<PAGE>

A reconciliation of the totals reported for the operating segments to our totals
reported in the consolidated condensed financial statements is as follows (in
thousands):

   <TABLE>
    <CAPTION>

                                                                  Nine months ended
                                                                    September 30,
                                                           ------------------------------
                                                              2001                 2000
                                                           ---------            ---------
   <S>                                                     <C>                  <C>
    PROFIT OR LOSS
    Total segment profit for reportable segments           $ 123,462            $ 101,625
                                                           ---------            ---------
    Unallocated Corporate expenses                           (67,162)             (64,707)
    Compensation and transaction costs related
         to recapitalization                                       -               (9,031)
    Stock-based compensation related to
         administrative employees                             (7,033)                   -
    Plant closing costs                                        7,502                    -
    Interest expense                                         (55,984)             (43,972)
          Total Corporate/Other                             (122,677)            (117,710)
                                                           ---------            ---------
       Income (loss) before taxes                          $     785            $ (16,085)
                                                           =========            =========
    </TABLE>


    <TABLE>
     <CAPTION>
                                                             September 30,      September 30,
                                                                  2001              2000
                                                            --------------      -------------
    <S>                                                       <C>                  <C>
    ASSETS
    Total assets for reportable segments                      $754,409             $716,543
    Intangible assets not allocated to segments                 48,061               15,183
    Other unallocated assets                                    61,292               75,789
                                                              --------             --------
          Total consolidated assets                           $863,762             $807,515
                                                              ========             ========
    </TABLE>


12.   CONDENSED CONSOLIDATING FINANCIAL STATEMENTS

      The following condensed consolidating financial statements present, in
      separate columns, financial information for (i) Pliant (on a parent only
      basis), with its investment in its subsidiaries recorded under the equity
      method, (ii) guarantor subsidiaries (as specified in the Indenture, dated
      May 31, 2000 (the "Indenture") relating to Pliant's $220 million senior
      subordinated notes due 2010 (the "Notes")) on a combined basis, with any
      investments in non-guarantor subsidiaries specified in the Indenture
      recorded under the equity method, (iii) direct and indirect non-guarantor
      subsidiaries on a combined basis, (iv) the eliminations necessary to
      arrive at the information for Pliant and its subsidiaries on a
      consolidated basis, and (v) Pliant on a consolidated basis, in each case
      as of September 30, 2001 and December 31, 2000 and for the three and nine
      month periods ended September 30, 2001 and 2000. The Notes are fully and
      unconditionally guaranteed on a joint and several basis by each guarantor
      subsidiary and each guarantor subsidiary is wholly owned, directly or
      indirectly, by Pliant. There are no contractual restrictions limiting
      transfers of cash from guarantor and non-guarantor subsidiaries to Pliant.
      The condensed consolidating financial statements are presented herein,
      rather than separate financial statements for each of the guarantor
      subsidiaries because management believes that separate financial
      statements relating to the guarantor subsidiaries are not material to
      investors. During the first quarter of 2001, our Blessings subsidiary was
      merged with and into Pliant. Accordingly, the former Blessings subsidiary
      is reflected as part of "Pliant Corporation Only" column for all periods
      presented.



                                       16

<PAGE>


PLIANT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATING BALANCE SHEET
AS OF SEPTEMBER 30, 2001 (IN THOUSANDS) (UNAUDITED)

<TABLE>
<CAPTION>

                                                             Pliant        Combined      Combined                    Consolidated
                                                          Corporation      Guarantor    Non-Guarantor                   Pliant
                                                          (Parent Only)  Subsidiaries    Subsidiaries  Eliminations   Corporation
                                                          -------------  ------------   -------------  ------------  ------------
<S>                                                         <C>          <C>              <C>           <C>            <C>
ASSETS
CURRENT ASSETS:
   Cash and cash equivalents                                $    4,343   $  (3,760)       $  3,183      $       -      $  3,766
   Receivables - net                                           104,530      10,848          20,033              -       135,411
   Inventories                                                  61,362       8,755          10,111              -        80,228
   Prepaid expenses and other                                    2,473         371             795                        3,638
   Income taxes receivable                                         383           -             354              -           737
   Deferred income taxes                                        12,994       1,206          (1,368)             -        12,832
                                                            ----------   ---------        --------      ---------      --------
      Total current assets                                     186,084      17,420          33,108              -       236,612
PLANT AND EQUIPMENT - Net                                      286,622      26,836          48,830              -       362,288
INTANGIBLE ASSETS - Net                                        213,758       3,823          16,781              -       234,362
INVESTMENT IN SUBSIDIARIES                                      62,575           -               -        (62,575)
OTHER ASSETS                                                    27,602         182           2,716                       30,500
                                                            ----------   ---------        --------      ---------      --------
TOTAL ASSETS                                                $  776,641   $  48,261        $101,435      $ (62,575)     $863,762
                                                            ==========   =========        ========      =========      ========

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES:
   Current portion of long-term debt                        $   15,713   $       -        $      -      $       -      $ 15,713
   Trade accounts payable                                       86,733       5,474          15,005              -       107,212
   Accrued liabilities                                          47,665       2,247           4,603              -        54,515
   Due to (from) affiliates                                    (17,186)     18,198          (1,012)             -
                                                            ----------   ---------        --------      ---------      --------
      Total current liabilities                                132,925      25,919          18,596              -       177,440
LONG-TERM DEBT - Net of current portion                        649,740       1,880          35,000              -       686,620
OTHER LIABILITIES                                               18,135           -           1,569              -        19,704
DEFERRED INCOME TAXES                                           28,146       1,229           2,553              -        31,928
                                                            ----------   ---------        --------      ---------      --------
      Total liabilities                                        828,946      29,028          57,718              -       915,692
                                                            ----------   ---------        --------      ---------      --------

MINORITY INTEREST                                                  (18)          -             375              -           357
REDEEMABLE STOCK                                               137,124           -              -               -       137,124
                                                            ----------   ---------        --------      ---------      --------
STOCKHOLDERS' EQUITY (DEFICIT):
   Common stock                                                104,387      14,034          29,616        (43,650)      104,387
   Warrants                                                     38,852                                                   38,852
   Retained earnings accumulated (deficit)                    (320,728)      5,210          20,566        (25,776)     (320,728)
   Stockholders' note receivable                                  (605)                                                    (605)
   Accumulated other comprehensive loss                        (11,317)        (11)         (6,840)         6,851       (11,317)
                                                            ----------   ---------        --------      ---------      --------
      Total stockholders' equity (deficit)                    (189,411)     19,233          43,342        (62,575)     (189,411)
                                                            ----------   ---------        --------      ---------      --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)        $  776,641   $  48,261        $101,435      $ (62,575)     $863,762
                                                            ==========   =========        ========      =========      ========
</TABLE>


                                       17
<PAGE>




PLIANT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATING BALANCE SHEET
AS OF DECEMBER 31, 2000 (IN THOUSANDS) (UNAUDITED)

<TABLE>
<CAPTION>


                                                             Pliant        Combined       Combined                   Consolidated
                                                          Corporation      Guarantor    Non-Guarantor                   Pliant
                                                          (Parent Only)  Subsidiaries    Subsidiaries  Eliminations   Corporation
                                                          -------------  ------------   -------------  ------------  ------------
<S>                                                         <C>          <C>              <C>           <C>            <C>
ASSETS
CURRENT ASSETS:
   Cash and cash equivalents                                $    459     $      10        $  2,591      $      -       $  3,060
   Receivables, net                                           90,670         4,966          19,422             -        115,058
   Inventories                                                64,884         6,983           7,284             -         79,151
   Prepaid expenses and other                                  1,527            30             426             -          1,983
   Income taxes receivable                                     1,885           (24)            897             -          2,758
   Deferred income taxes                                      14,431            37          (1,476)            -         12,992
                                                            --------     ---------        --------      --------       --------
      Total current assets                                   173,856        12,002          29,144             -        215,002
PLANT AND EQUIPMENT, net                                     268,739        16,538          47,806             -        333,083
INTANGIBLE ASSETS, net                                       185,727         2,482          17,661             -        205,870
INVESTMENT IN SUBSIDIARIES                                    49,611             -               -       (49,611)             -
OTHER ASSETS                                                  28,593             -           2,486             -         31,079
                                                            --------     ---------        --------      --------       --------
TOTAL ASSETS                                                $706,526     $  31,022        $ 97,097      $(49,611)      $785,034
                                                            ========     =========        ========      ========       ========

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES:
   Current portion of long-term debt                        $  8,312     $       -          $1,050      $      -       $  9,362
   Trade accounts payable                                     87,970         5,730          15,318             -        109,018
   Accrued liabilities                                        32,068         1,201           5,743             -         39,012
   Due to (from) affiliates                                  (10,000)       13,442          (3,442)            -              -
                                                            --------     ---------        --------      --------       --------
      Total current liabilities                              118,350        20,373          18,669             -        157,392
LONG-TERM DEBT, net of current portion                       642,976             -          35,055             -        678,031
OTHER LIABILITIES                                             24,200             -           1,557             -         25,757
DEFERRED INCOME TAXES                                         30,206           497           2,357             -         33,060
                                                            --------     ---------        --------      --------       --------
      Total liabilities                                      815,732        20,870          57,638             -        894,240
                                                            --------     ---------        --------      --------       --------
REDEEMABLE  STOCK                                             96,805             -               -            -          96,805
                                                            --------     ---------        --------      --------       --------

STOCKHOLDERS' EQUITY (DEFICIT)
   Common stock                                               87,989        14,020          29,241       (43,261)        87,989
   Warrants to purchase common stock                          26,500             -               -             -         26,500
   Retained earnings (accumulated deficit)                  (312,414)       (3,857)         15,966       (12,109)      (312,414)
   Shareholder note receivable                                  (825)            -               -             -           (825)
   Accumulated other comprehensive income (loss)              (7,261)          (11)         (5,748)        5,759         (7,261)
                                                            --------     ---------        --------      --------       --------
      Total stockholders' equity (deficit)                   206,011)       10,152          39,459       (49,611)      (206,011)
                                                            --------     ---------        --------      --------       --------
TOTAL LIABILITIES AND
   STOCKHOLDERS' EQUITY (DEFICIT)                           $706,526     $  31,022        $ 97,097      $(49,611)      $785,034
                                                            ========     =========        ========      ========       ========
</TABLE>


                                       18
<PAGE>


PLIANT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATING INCOME STATEMENT
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2001 (IN THOUSANDS) (UNAUDITED)


<TABLE>
<CAPTION>

                                                        Pliant         Combined      Combined                   Consolidated
                                                      Corporation     Guarantor    Non-Guarantor                   Pliant
                                                     (Parent Only)   Subsidiaries  Subsidiaries   Eliminations   Corporation
                                                     -------------  -------------  ------------   ------------   -----------
<S>                                                     <C>            <C>            <C>           <C>           <C>
NET SALES                                               $  177,202     $  14,819      $  32,099      $  (3,770)   $  220,350
COST OF SALES                                              139,815        12,481         25,363         (3,770)      173,889
                                                        ----------     ---------      ---------      ---------    ----------
GROSS PROFIT                                                37,387         2,338          6,736             -         46,461
OPERATING EXPENSES                                          13,744           337          2,819             -         16,900
                                                        ----------     ---------      ---------      ---------    ----------

OPERATING INCOME                                            23,643         2,001          3,917             -         29,561
INTEREST EXPENSE                                           (18,203)          (36)          (638)            -        (18,877)
EQUITY IN EARNINGS OF SUBSIDIARIES                           3,604                                     (3,604)
OTHER INCOME  (EXPENSE), Net                                   805           (49)           126             -            882
                                                        ----------     ---------      ---------      ---------    ----------
INCOME (LOSS) BEFORE INCOME TAXES                            9,849         1,916          3,405        (3,604)        11,566
INCOME TAX PROVISION (BENEFIT)                               2,987             -          1,717             -          4,704
                                                        ----------     ---------      ---------      ---------    ----------
NET INCOME (LOSS)                                       $    6,862     $   1,916       $  1,688     $  (3,604)    $    6,862
                                                        ==========     =========       ========     ==========    ==========
</TABLE>


                                       19

<PAGE>




PLIANT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATING INCOME STATEMENT
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2000 (IN THOUSANDS) (UNAUDITED)

<TABLE>
<CAPTION>

                                                        Pliant         Combined      Combined                    Consolidated
                                                      Corporation     Guarantor    Non-Guarantor                    Pliant
                                                     (Parent Only)   Subsidiaries  Subsidiaries    Eliminations   Corporation
                                                     -------------  -------------  -------------   ------------   -----------
<S>                                                      <C>            <C>            <C>           <C>           <C>

NET SALES                                                $ 175,644      $ 10,367       $  28,918      $  (4,134)     $210,795
COST OF SALES                                              148,633         9,775          22,265         (4,134)      176,539
                                                         ---------      --------       ---------      ---------    ----------

GROSS PROFIT                                                27,011           592           6,653              -        34,256
OPERATING EXPENSES                                          19,955            90           2,722              -        22,767
                                                         ---------      --------       ---------      ---------    ----------

OPERATING INCOME (LOSS)                                      7,056           502           3,931              -        11,489
INTEREST EXPENSE                                           (20,095)           (2)           (990)             -       (21,087)
EQUITY IN EARNINGS OF SUBSIDIARIES                           2,148                                       (2,148)
OTHER INCOME (EXPENSE), Net                                   (446)            9             412              -           (25)
                                                         ---------      --------       ---------      ---------    ----------

INCOME BEFORE INCOME TAXES AND
  EXTRAORDINARY LOSS                                       (11,337)          509           3,353         (2,148)       (9,623)
INCOME TAX PROVISION (BENEFIT)                              (4,797)          207           1,507              -        (3,083)
                                                         ---------      --------       ---------      ---------    ----------

NET INCOME (LOSS) BEFORE EXTRAORDINARY LOSS                 (6,540)          302           1,846              -        (6,540)
EXTRAORDINARY LOSS (NET OF TAX)                                  -             -               -              -             -
                                                         ---------      --------       ---------      ---------    ----------
NET INCOME (LOSS)                                        $  (6,540)     $    302      $    1,846      $  (2,148)   $   (6,540)
                                                         =========      ========      ==========      =========    ==========
</TABLE>

                                       20
<PAGE>




PLIANT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATING INCOME STATEMENT
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2001 (IN THOUSANDS) (UNAUDITED)

<TABLE>
<CAPTION>

                                                        Pliant         Combined      Combined                   Consolidated
                                                      Corporation     Guarantor    Non-Guarantor                   Pliant
                                                     (Parent Only)   Subsidiaries  Subsidiaries   Eliminations   Corporation
                                                     -------------  -------------  ------------   ------------   -----------
<S>                                                  <C>            <C>            <C>            <C>            <C>
NET SALES                                              $518,126       $33,234        $89,065        $(13,847)     $(626,578)
COST OF SALES                                           414,074        28,174         70,096         (13,847)       498,497
                                                       --------       -------        -------        --------      ---------

GROSS PROFIT                                            104,052         5,060         18,969               -        128,081
OPERATING EXPENSES                                       67,037           517          8,094               -         75,648
                                                       --------       -------        -------        --------      ---------

OPERATING INCOME                                         37,015         4,543         10,875               -         52,433
INTEREST EXPENSE                                        (55,892)          (36)        (2,374)              -        (58,302)
EQUITY IN EARNINGS OF SUBSIDIARIES                       13,817                                      (13,817)
OTHER INCOME , Net                                        1,926         4,560            168               -          6,654
                                                       --------       -------        -------        --------      ---------

INCOME (LOSS) BEFORE INCOME TAXES                        (3,134)        9,067          8,669         (13,817)           785
INCOME TAX PROVISION (BENEFIT)                           (1,068)            -          3,919         (13,817)         2,851
                                                       --------       -------        -------        --------       --------
NET INCOME (LOSS)                                      $ (2,066)      $ 9,067        $ 4,750        $(13,817)      $ (2,066)
                                                       ========       =======        =======        ========       ========
</TABLE>




                                       21
<PAGE>

PLIANT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATING INCOME STATEMENT
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2000 (IN THOUSANDS) (UNAUDITED)

<TABLE>
<CAPTION>

                                                        Pliant        Combined      Combined                   Consolidated
                                                      Corporation    Guarantor    Non-Guarantor                   Pliant
                                                     (Parent Only)  Subsidiaries  Subsidiaries   Eliminations  Corporation
                                                     -------------  ------------  -------------  ------------  ------------
<S>                                                   <C>            <C>            <C>           <C>          <C>
NET SALES                                             $540,784       $ 31,970       $ 83,947      $ (13,806)   $  642,895
COST OF SALES                                          447,523         30,785         64,878        (13,806)      529,380
                                                      --------       --------       --------      ---------    ----------

GROSS PROFIT                                            93,261          1,185         19,069              -       113,515
OPERATING EXPENSES                                      73,768            270          8,444              -        82,482
                                                      --------       --------       --------      ---------    ----------
OPERATING INCOME (LOSS)                                 19,493            915         10,625              -        31,033
INTEREST EXPENSE                                       (43,989)       (12,185)        (2,946)             -       (46,935)
EQUITY IN EARNINGS OF SUBSIDIARIES                       5,394                                       (5,394)
OTHER INCOME (EXPENSE), Net                             (1,182)            (9)         1,008              -          (183)
                                                      --------       --------       --------      ---------    ----------

INCOME(LOSS) BEFORE INCOME TAXES
    AND EXTRAORDINARY LOSS                             (20,284)           906          8,687         (5,394)      (16,085)
INCOME TAX PROVISION (BENEFIT)                          (6,301)           367          3,832              -        (2,102)
                                                      --------       --------       --------      ---------    ----------

NET INCOME (LOSS) BEFORE EXTRAORDINARY LOSS            (13,983)           539          4,855         (5,394)      (13,983)

EXTRAORDINARY LOSS (NET OF TAX)                        (11,250)             -              -              -       (11,250)
                                                      --------       --------       --------      ---------    ----------

NET INCOME (LOSS)                                     $(25,233)      $    539       $  4,855      $  (5,394)   $  (25,233)
                                                      ========       ========       ========      =========    ==========
</TABLE>



                                       22

<PAGE>


PLIANT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2001 (IN THOUSANDS) (UNAUDITED)

<TABLE>
<CAPTION>

                                                        Pliant         Combined      Combined                   Consolidated
                                                      Corporation     Guarantor    Non-Guarantor                   Pliant
                                                     (Parent Only)   Subsidiaries  Subsidiaries   Eliminations  Corporation
                                                     -------------   ------------  -------------  ------------  ------------
<S>                                                  <C>             <C>             <C>           <C>             <C>
CASH FLOWS PROVIDED BY (USED IN)
   OPERATING ACTIVITIES                               $   7,239       $  6,491        $ 9,641       $      -       $   23,371

CASH FLOWS FROM INVESTING ACTIVITIES:
   Proceeds from sale of assets                           2,966          4,948              -              -            7,914
   Uniplast Acquisition (net of cash)                   (31,698)       (14,020)        (9,813)             -          (55,531)
   Capital expenditures for plant and equipment         (34,630)        (3,274)        (2,123)             -          (40,027)
                                                      ---------       --------        -------       --------       ----------
     Net cash (used in) provided by
       investing activities                             (63,362)       (12,346)       (11,936)             -          (87,644)
                                                      ---------       --------        -------       --------       ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
   Payment of Capitalized Fees                           (1,932)             -              -              -           (1,932)
   Receipt/payment of dividends                             150              -           (150)             -                -
   Net proceeds from issuance of common stock and
     net change in related stockholders' notes
     receivables                                         47,636              -              -              -           47,636
                                                                                                           -
   Minority Interest                                        (18)             -            375                             357
   Borrowings on  long-term debt                         14,165          1,880         (1,105)             -           14,940
                                                      ---------       --------        -------       --------       ----------
     Net cash provided by financing
     activities                                          60,001          1,880           (880)             -           61,001
                                                      ---------       --------        -------       --------       ----------

EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH
   EQUIVALENTS                                                6            205          3,767              -            3,978
                                                      ---------       --------        -------       --------       ----------
NET INCREASE (DECREASE) IN CASH                           3,884         (3,770)           592              -              706
   AND CASH EQUIVALENTS

CASH AND CASH EQUIVALENTS AT BEGINNING OF THE
   PERIOD                                                   459             10          2,591              -            3,060
                                                      ---------       --------        -------       --------       ----------
CASH AND CASH EQUIVALENTS AT
   END OF THE PERIOD                                  $   4,343       $ (3,760)       $ 3,183       $      -       $    3,766
                                                      =========       ========        =======       ========       ==========
</TABLE>


                                       23

<PAGE>


PLIANT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2000 (IN THOUSANDS) (UNAUDITED)

<TABLE>
<CAPTION>

                                                        Pliant       Combined      Combined                   Consolidated
                                                     Corporation    Guarantor    Non-Guarantor                   Pliant
                                                     Parent Only   Subsidiaries  Subsidiaries   Eliminations  Corporation
                                                     -----------   ------------  -------------  ------------  ------------
<S>                                                   <C>            <C>           <C>            <C>           <C>
CASH FLOWS PROVIDED BY OPERATING ACTIVITIES           $  32,647      $  6,535      $  9,365       $      -      $  48,547


CASH FLOWS FROM INVESTING ACTIVITIES:
   Capital expenditures for plant and equipment         (33,262)       (4,517)       (2,301)             -        (40,080)
                                                      ---------      --------      --------       --------      ---------


CASH FLOWS FROM FINANCING ACTIVITIES:
   Payment of capitalized loan fees                     (21,928)            -             -              -        (21,928)
   Payment of fees from tender offer                    (10,055)            -             -              -        (10,055)
   Redemption of common stock                          (314,034)            -             -              -       (314,034)
   Net proceeds from issuance of stock and net
     change in related stockholder notes receivable     161,255             -             -              -        161,255
   Principal payments to and proceeds from
     long-term debt                                     187,921             -        (5,907)             -        182,014
                                                      ---------      --------      --------       --------      ---------
     Net cash provided by/(used in) financing
       Activities                                         3,159             -        (5,907)             -         (2,748)
                                                      ---------      --------      --------       --------      ---------

EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH
   EQUIVALENTS                                            3,327        (2,527)       (2,424)             -         (1,624)
                                                      ---------      --------      --------       --------      ---------

NET INCREASE (DECREASE) IN CASH
   AND CASH EQUIVALENTS                                   5,871          (509)       (1,267)             -          4,095

CASH AND CASH EQUIVALENTS AT BEGINNING OF THE
   PERIOD                                                 1,231           517         7,349              -          9,097
                                                      ---------      --------      --------       --------      ---------
CASH AND CASH EQUIVALENTS AT
   END OF THE PERIOD                                  $   7,102      $      8      $  6,082       $      -      $  13,192
                                                      =========      ========      ========       ========      =========
</TABLE>


                                       24


<PAGE>


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS

The purpose of this section is to discuss and analyze our consolidated financial
condition, liquidity and capital resources and results of operations. This
analysis should be read in conjunction with Management's Discussion and Analysis
of Financial Condition and Results of Operations contained in our Annual Report
on Form 10-K for the year ended December 31, 2000 (the "2000 10-K") and our
Registration Statement on Form S-1 (file No. 333-65754). This section contains
certain forward-looking statements within the meanings of federal securities
laws that involve risks and uncertainties, including statements regarding our
plans, objectives, goals, strategies and financial performance. Our actual
results could differ materially from the results anticipated in these
forward-looking statements as a result of factors set forth under "Cautionary
Statement for Forward-Looking Information" below and elsewhere in this report.

GENERAL

We generate our revenues, earnings and cash flows from the sale of film and
flexible packaging products throughout the world. We manufacture these products
at 26 facilities located in North America, Central America, Europe and
Australia. Our annual sales have grown primarily as a result of strategic
acquisitions made over the past several years, increased levels of production at
acquired facilities, return on capital expenditures and the overall growth in
the markets for film and flexible packaging products.

On May 31, 2000, we consummated a recapitalization pursuant to an agreement
dated March 31, 2000 (the "Recapitalization Agreement") among us, our then
existing stockholders and an affiliate of J.P. Morgan Partners, LLC, whereby an
affiliate of J.P. Morgan Partners, LLC acquired majority control of our common
stock. Pursuant to the Recapitalization Agreement, we redeemed all of the shares
of our common stock held by Jon M. Huntsman, our founder, then majority
stockholder and then Chairman of the Board (the "Equity Redemption") for
approximately $314.0 million. An affiliate of J.P. Morgan Partners, LLC
purchased approximately one-half of the shares of our common stock held
collectively by The Christena Karen H. Durham Trust (the "Trust") and by members
of our current and former senior management (the "Management Investors") for
approximately $101.8 million. An affiliate of J.P. Morgan Partners, LLC and
certain other institutional investors also purchased (the "Investor Common
Equity Contribution") shares of common stock directly from us for approximately
$63.5 million ($62.6 million net of offering costs). The Trust and the
Management Investors retained or "rolled over" approximately one-half of the
shares of our common stock collectively owned by them prior to the
recapitalization. In addition, we issued to another affiliate of J.P. Morgan
Partners, LLC and to certain other institutional investors a new series of
senior cumulative exchangeable redeemable preferred stock (the "Preferred
Stock") and detachable warrants for our common stock (the "Preferred Stock
Warrants") for net consideration of approximately $98.5 million. The foregoing
transactions are collectively referred to as the "Recapitalization." The total
consideration paid in the Recapitalization was approximately $1.1 billion,
including transaction costs.

On November 12, 2001, approximately 53.0% of our total common stock was owned by
an affiliate of J.P. Morgan Partners, LLC, approximately 9.9% of our total
common stock was owned by certain other institutional investors and
approximately 37.1% of our total common stock was owned collectively by the
Trust and the Management Investors. J.P. Morgan Partners, LLC owns our common
stock through its Flexible Film, LLC subsidiary and owns our preferred stock
through its Southwest Industrial Films, LLC subsidiary.


                                       25
<PAGE>

The Recapitalization constituted a "change of control" under the provisions of
our long-term incentive plans ("LTIP"). Upon a change of control, all
participants in the LTIP fully vest and all amounts due to the participants were
payable within 90 days. As a result, we accrued $5.0 million of compensation
expense in the three months ended March 31, 2000 relating to the vesting under
the LTIP. In addition, we incurred $0.2 million of fees and expenses in
connection with the Recapitalization in the three months ended March 31, 2000.
Both the LTIP compensation expense and these fees and expenses are included in
"compensation and transaction costs related to recapitalization" in the
accompanying condensed consolidated statement of operations for the six months
ended June 30, 2000.


RESULTS OF OPERATIONS

The following table sets forth net sales, operating expenses, and operating
income and such amounts as a percentage of net sales, for the three and six
months ended June 30, 2001 and 2000 (dollars in millions).

<TABLE>
<CAPTION>
                              Three Months Ended September 30                Nine Months Ended September 30
                           --------------------------------------       --------------------------------------
                                  2001                 2000                     2001                2000
                           ------------------   -----------------       --------------------   ---------------
                                      % of                 % of                     % of                 % of
                             $        Sales        $       Sales          $         Sales      $         Sales
                           ------     -----      ------    -----        ------      -----    ------      -----
<S>                        <C>        <C>        <C>       <C>          <C>         <C>       <C>        <C>
Net Sales                  $220.4     100.0%     $210.8    100.0%       $626.6      100.0%    $642.9     100.0%
Cost of sales               173.9      78.9       176.5     83.7         498.5       79.6      529.4      82.3
                           ------     -----      ------    -----        ------      -----     ------     -----
Gross profit                 46.5      21.1        34.3     16.3         128.1       20.4      113.5      17.6
Total operating expenses     16.9       7.7        22.8     10.8          75.6       12.1       82.5      12.8
                           ------     -----      ------    -----        ------      -----     ------     -----
Operating income           $ 29.6      13.4%     $ 11.5      5.5%       $ 52.5        8.4%    $ 31.0       4.8%
                           ======     =====      ======    =====        ======      =====     ======     =====
</TABLE>

THREE MONTHS ENDED SEPTEMBER 30, 2001 COMPARED TO THREE MONTHS ENDED
SEPTEMBER 30, 2000

Net Sales

Net sales increased by $9.6 million, or 4.5%, from $210.8 million for the three
months ended September 30, 2000 to $220.4 million for the three months ended
September 30, 2001. This increase was primarily due to a 12% increase in sales
volume partially offset by a decrease in average selling prices of 6.7%.
Excluding the sales volume from the Uniplast acquisition, sales volumes in the
third quarter of 2001 increased 4% as compared to the same period in 2000. In
the markets we serve, the average selling price of our products generally
increases or decreases as the price of resins, our primary raw material,
increases or decreases. Average resin prices were lower during the third quarter
of 2001 compared to the third quarter of 2000 resulting in a decrease in our
average selling prices.

Gross Profit

Gross profit increased by $12.2 million, or 35.6%, from $34.3 million for the
three months ended September 30, 2000, to $46.5 million for the three months
ended September 30, 2001. The increase was primarily due to higher gross margins
and the effect of higher sales volumes.

Total Operating Expenses

Total operating expenses decreased by $5.9 million, or 25.9%, from $22.8 million
for the third quarter of 2000 to $16.9 million for the third quarter ended
September 30, 2001. The most significant item contributing to this decrease was
a $7.5 million credit to plant closing costs. We analyzed the economics of
closing our Harrington facility in light of changes in customer demand and the
acquisition of Uniplast. These changes together with the movement of a
production line from the Birmingham plant have significantly improved the
profitability of the


                                       26

<PAGE>

Harrington facility. As a result, we have revised our plans to close the
Harrington facility. Therefore, the remaining balance of the closure accrual
related to the Harrington facility was credited to the plant closing costs. In
addition, other plant and office closing costs of $1.3 million was expensed in
the third quarter of 2001 while depreciation expenses in the third quarter 2001
increased $1.2 million due to new computer systems. Further, the operating
expenses for the third quarter of 2000 included $2.4 million of compensation and
transaction costs related to the Recapitalization.


Operating Income

Operating income increased by $18.1 million, or 157%, from $11.5 million for the
third quarter of 2000 to $29.6 million for the third quarter ended September 30,
2001, due to the factors discussed above.

Interest Expense

Interest expense decreased by $2.2 million, or 10.4%, from $21.1 million for
the third quarter of 2000, to $18.9 million for the third quarter ended
September 30, 2001. This decrease was principally due to the reduction in LIBOR
that effect the borrowing costs of the companies term debt partially offset by
the increase in the use of the line of credit.


Other Income (Expense)

Other income (expense), net changed from expense of approximately $25,000 for
the third quarter ended September 30, 2000, to income of approximately $882,000
for the third quarter ended September 30, 2001, an increase in income of
approximately $907,000. The increase was primarily due to an insurance claim at
the Danville plant as a result of a fire.


NINE MONTHS ENDED SEPTEMBER 30, 2001 COMPARED TO NINE MONTHS ENDED SEPTEMBER 30,
2000

Net Sales

Net sales decreased by $16.3 million, or 2.5%, from $642.9 million for the nine
months ended September 30, 2000 to $626.6 million for the nine months ended
September 30, 2001. The decrease was primarily due to a 5.2% decrease in our
average selling prices partially offset by a 2.9% increase in sales volume.
Excluding the sales volume from the Uniplast acquisition, sales volumes in the
nine months ended September 30, 2001 increased .3% as compared to the same
period in 2000. In the markets we serve, the average selling price of our
products generally increases or decreases as the price of resins, our primary
raw material, increases or decreases. Average resin prices were lower during the
first nine months of 2001 compared to the same period in 2000 resulting in a
decrease in our average selling prices.

Gross Profit

Gross profit increased by $14.6 million, or 12.8%, from $113.5 million for the
nine months ended September 30, 2000, to $128.1 million for the nine months
ended September 30, 2001. The increase was primarily due to the effect of higher
gross margins and the effect of higher sales volumes.

Total Operating Expenses

Total operating expenses decreased by $6.9 million, or 8.4%, from $82.5 million
for the nine months ended September 30, 2000 to $75.6 million for the nine
months ended September 30, 2001. The most significant items contributing to this
decrease were a $6.1 million reduction in fees paid to consultants relating to a
company-wide

                                       27
<PAGE>

supply chain improvement initiative and a $7.5 million credit to plant closing
costs. We analyzed the economics of closing our Harrington facility in light of
changes in customer demand and the acquisition of Uniplast. These changes
together with the movement of a production line from the Birmingham plant have
significantly improved the profitability of the Harrington facility. As a
result, we have revised our plans to close the Harrington facility. Therefore,
the remaining balance of the closure accrual related to the Harrington facility
was credited to the plant closing costs for the nine months ended September 30,
2001. In addition, other plant and office closing and downsizing costs of $4.6
million was expensed during the nine months ended September 30, 2001.
Depreciation expenses for the nine months ended September 30, 2001 increased
$2.6 million due to new computer systems


Operating Income

Operating income increased by $21.5 million, or 69.4%, from $31.0 million for
the nine months ended September 30, 2000 to $52.5 million for the nine months
ended September 30, 2001, due to the factors discussed above.

Interest Expense

Interest expense increased by $11.4 million, or 24%, from $46.9 million for the
nine months ended September 30, 2000, to $58.3 million for the nine months ended
September 30, 2001. As a result of the financing for the May 31, 2000
recapitalization, interest expense increased significantly compared to the prior
year. This increase was partially offset by the reduction in LIBOR in the third
quarter of 2001.

Other Income (Expense)

Other income (expense), net changed from expense of $0.2 million for the nine
months ended September 30, 2000, to income of $6.6 million for the nine months
ended September 30, 2001, an increase in income of $6.8 million. The increase
was primarily due to the proceeds and assets received from a settlement with a
potential new customer in the second quarter of 2001 and other less significant
items.


OPERATING SEGMENT REVIEW

    General. Operating segments are components of our company for which separate
financial information is available that is evaluated regularly by our chief
operating decision maker in deciding how to allocate resources and in assessing
performance. For more information on our operating segments see Note 11 to the
unaudited condensed consolidated financial statements.


THREE MONTHS ENDED SEPTEMBER 30, 2001 COMPARED WITH THE THREE MONTHS ENDED
SEPTEMBER 30, 2000


Specialty Films

  Net Sales. The net sales of our specialty films segment increased $12 million,
or 12.8%, from $93.4 million for the three months ended September 30, 2000 to
$105.4 million for the three months ended September 30, 2001. This increase was
primarily due to a 16.6% increase in sales volume partially offset by a 3.2%
decrease in our average selling prices. Excluding the effect of the Uniplast
acquisition, sales volumes increased 6.5% during the three months ended
September 30, 2001 as compared to the same period in 2000. Selling prices
decreased principally due to the effects of a decrease in resin prices.


                                       28
<PAGE>

  Segment Profit. The specialty films segment profit increased $7.9 million, or
52%, from $15.2 million for the three months ended September 30, 2000 to $23.1
million for the three months ended September 30, 2001. The increase was
primarily due to the increase in sales discussed above including the effect of
the Uniplast acquisition and improved margins.

  Segment Total Assets. The specialty films segment total assets increased $35.2
million, or 8.6%, from $407.2 million as of September 30, 2000 to $442.4 million
as of September 30, 2001. The increase was principally due to the acquisition of
Uniplast, capital expenditures for capacity expansions and the reserve for plant
closing cost for Harrington that was deducted from segment assets as of
September 30, 2000 partially offset by depreciation expenses.



Design Products

  Net Sales. The net sales of our design products segment decreased $3.6
million, or 6.5%, from $55.7 million for the three months ended September 30,
2000 to $52.1 million for the three months ended September 30, 2001. This
decrease was primarily due to a 7% decrease in our average selling prices. Sales
volumes remained relatively stable for the three months ended September 30, 2001
as compared to the same period in 2000.

  Segment Profit. The design products segment profit increased $.8 million, or
11% , from $7 million for the three months ended September 30, 2000 to $7.8
million for the three months ended September 30, 2001. This increase was
principally due to improved margins partially offset by the effect of lower
sales volumes.



  Segment Total Assets. The design products segment total assets increased $3.8
million, or 2%, from $177.5 million as of September 30, 2000 to $181.3 million
as of September 30, 2001. Capital expenditures for capacity additions were
partially offset by depreciation expenses.


Industrial Films

  Net Sales. The net sales in our industrial films segment increased $1.2
million, or 1.9%, from $61.7 million for the three months ended September 30,
2000 to $62.9 million for the three months ended September 30, 2001. This
increase was primarily due to a 11.8% increase in sales volumes primarily as a
result of the Uniplast acquisition partially offset by a 8.9% decrease in
selling prices. Selling prices decreased due the effects of a decrease in resin
prices and a change in sales mix.


  Segment Profit. The industrial films segment profit increased $4.1 million, or
49%, from $8.4 million for the three months ended September 30, 2000 to $12.5
million for the three months ended September 30, 2001. This increase was
principally due to the acquisition of Uniplast, the effect of higher sales
discussed above and the effect of higher margins.

  Segment Total Assets. The industrial films segment total assets decreased $1
million, or 0.7%, from $131.8 million as September 30, 2000 to $130.8 million as
of September 30, 2001. This decrease was principally due to the write-down of
fixed assets due to the closure of our Birmingham, Alabama facility partially
offset by the assets from the Uniplast acquisition. In addition, capital
expenditures for maintenance of business were offset by depreciation expenses.

                                       29
<PAGE>

UNALLOCATED CORPORATE EXPENSES

Unallocated corporate expenses increased $3.3 million, or 18.6%, from $17.7
million, for the three months ended September 30, 2000 to $21.0 million for the
three months ended September 30, 2001. The most significant items contributing
to this increase were plant and office closing costs including inventory
write-downs of $1.8 million recorded in the third quarter of 2001 and higher
depreciation expenses in the third quarter 2001 of $1.2 million due to new
computer systems.



NINE MONTHS ENDED SEPTEMBER 30, 2001 COMPARED WITH THE NINE MONTHS ENDED
SEPTEMBER 30, 2000


Specialty Films

  Net Sales. The net sales of our specialty films segment decreased $17.7
million, or 5.9%, from $298.7 million for the nine months ended 2000 to $281.0
million for the nine months ended September 30, 2001. The decrease was primarily
due to a 2.5% decrease in sales volume and a 3.4% decrease in our average
selling prices. The volume decrease was primarily due to the insourcing of a
specific product by one of our most significant customers partially offset by
the sales volume from the Uniplast acquisition in the third quarter of 2001.
Selling prices decreased principally due to the effect of a decrease in resin
prices.

  Segment Profit. The specialty film segment profit increased $5.9 million, or
10.5%, from $56 million for the nine months ended September 30, 2000 to $61.9
million for the nine months ended September 30, 2001. This increase was
principally due to the increase in gross margin partially offset by the effect
of lower sales volumes.


Design Products

  Net Sales. The net sales of our design products segment remained relatively
stable at $161 million for the nine months ended September 30, 2001 as compared
to the same period in 2000. An increase in sales volume of 6.3% was offset by a
5.8% decrease in selling prices. The increase in sales volume was primarily due
to growth of new product lines. Selling prices decreased primarily due to the
effects of a decrease in resin prices and a change in product mix.

  Segment Profit. The design products segment profit increased $10.0 million, or
53.5%, from $18.7 million for the nine months ended September 30, 2000 to $28.7
million for the nine months ended September 30, 2001. This increase was
principally due to a settlement with a potential customer during the second
quarter of 2001. In addition, segment profits were favorably affected by higher
margins.


Industrial Films

  Net Sales. The net sales in our industrial films segment increased $2.2
million, or 1.2%, from $182.4 million for the nine months ended September 30,
2000 to $184.6 million for the nine months ended September 30, 2001. An increase
in sales volume of 8.1% was partially offset by a 6.3% decrease in selling
prices. Selling prices decreased due to the effect of a decrease in resin prices
and a change in sales mix.

                                       30
<PAGE>



  Segment Profit. The industrial films segment profit increased $6.0 million, or
22%, from $26.9 million for the nine months ended September 30, 2000 to $32.9
million for the nine months ended September 30, 2001 principally due to the
effects of an increase in sales volume and gross margin.


UNALLOCATED CORPORATE EXPENSES

Unallocated corporate expenses increased $2.5 million or 3.9% from $64.7 million
for nine months ended September 30, 2000 to $67.2 million for the nine months
ended September 30, 2001. The most significant items contributing to this
increase were a $6.5 million reduction in fees paid to consultants relating to a
company-wide supply chain improvement initiative, which was more than offset by
plant and office closing costs of $6.4 million recorded in the nine months ended
September 30, 2001 and higher depreciation expenses in the nine months ended
September 30, 2001 of $2.6 million due to new computer systems.


LIQUIDITY AND CAPITAL RESOURCES

Upon closing of the Recapitalization, we issued 220,000 Units (the "Units")
consisting of $220.0 million principal amount of 13% Senior Subordinated Notes
due 2010 (the "Notes") and Warrants (the "Note Warrants") to purchase 18,532
shares of common stock. The Notes were issued at a discount of approximately
$5.9 million and mature on June 1, 2010. The Units were issued in a private
placement transaction exempt from the registration requirements under the
Securities Act of 1933. On August 29, 2000, our registration statement relating
to the exchange of the private Notes for Notes registered under the Securities
Act of 1933 was declared effective by the Securities and Exchange Commission,
and, as a result, the Notes and the Note Warrants became separated. We
consummated the exchange offer and issued $220.0 million of registered Notes for
all of the private Notes on October 12, 2000. Interest on the Notes is payable
semi-annually on each June 1 and December 1, commencing on December 1, 2000. The
Notes are unsecured. The Notes are subordinated to all of our existing and
future senior debt, rank equally with any future senior subordinated debt and
rank senior to any future subordinated debt. The Notes are guaranteed by some of
our subsidiaries. The Note Warrants became exercisable on August 29, 2000, and
mature on June 1, 2010.

Upon closing of the offering of the Units and the Recapitalization, we purchased
all of our outstanding $125.0 million principal amount of 9 1/8% Senior
Subordinated Notes due 2007, refinanced all amounts outstanding under our prior
credit facility (the "Prior Credit Facility") and replaced the Prior Credit
Facility with amended and restated senior secured credit facilities (the "New
Credit Facilities") with The Chase Manhattan Bank, Bankers Trust Company, The
Bank of Nova Scotia and a syndicate of banking institutions. The New Credit
Facilities consist of a $200.0 million senior secured tranche A facility, $40.0
million of which was made available to our principal Mexican subsidiary (the
"Tranche A Facility"), a $280.0 million senior secured tranche B facility (the
"Tranche B Facility") and a $100.0 million revolving credit facility (the
"Revolving Credit Facility").

Effective September 30, 2000, we entered into an amendment of our New Credit
Facilities. The amendment modified certain financial covenants contained in the
New Credit Facilities, including the leverage and interest coverage ratios and
the permitted amount of capital expenditures. We were in compliance with the
amended covenants of our New Credit Facilities as of September 30, 2001.

On July 16, 2001, we acquired 100% of the outstanding stock of Uniplast Holdings
Inc. for approximately $57.1 million, consisting of the assumption of
approximately $40.3 million of debt and the issuance of shares of our common
stock valued at approximately $16.8 million to the selling shareholders of
Uniplast (of which 3,468 shares valued at approximately $1.7 million are subject
to certain holdback arrangements and had not been delivered at closing). At the
closing of the acquisition, we refinanced approximately $37.0 million of assumed
debt with the proceeds from a private placement of 29,000 of preferred stock at
$ 1,000 per share and borrowings under our revolving credit facility. In
connection with the Uniplast acquisition, we entered into an


                                       31
<PAGE>

amendment of our credit facilities and incurred amendment fees of $1.4 million.
In addition, we also issued 1,983 shares of our preferred stock at $1,000 per
share, together with warrants to purchase 2,013 shares of common stock, to
certain of our employees. We also incurred $0.9 million of legal and
administrative expenses. We recorded $14.4 million as intangible assets and $
19.3 million as goodwill as a result of this acquisition. The intangible assets
are being amortized over 15 years while the goodwill is not being amortized. The
operating results for Uniplast from July 16,2001 is included in the statements
of operations for the periods ended September 30, 2001.

Loans under the Revolving Credit Facility and the Tranche A Facility bear
interest, at our option, at either Adjusted LIBOR plus 3.25% or ABR (as defined
below) plus 2.25%, in each case subject to certain adjustments. Loans under the
Tranche B Facility bear interest, at our option, at either Adjusted LIBOR plus
3.75% or ABR plus 2.75%. We may elect interest periods of one, two, three or six
months for Adjusted LIBOR borrowings. Interest is calculated on the basis of
actual days elapsed in a year of 360 days (or 365 or 366 days, as the case may
be, in the case of ABR loans based on the Prime Rate) and interest is payable at
the end of each interest period and, in any event, at least every three months.
ABR is the Alternate Base Rate, which is the higher of Bankers Trust Company's
Prime Rate or the Federal Funds Effective Rate plus 1/2 of 1%. Adjusted LIBOR
will at all times include statutory reserves.

Our obligations under the New Credit Facilities are guaranteed by substantially
all of our domestic subsidiaries and secured by substantially all of our
domestic assets. The New Credit Facilities are also secured by a pledge of 65%
of the capital stock of each of our foreign subsidiaries.

The New Credit Facilities and the indenture relating to the Notes impose certain
restrictions on us, including restrictions on our ability to incur indebtedness,
pay dividends, make investments, grant liens, sell our assets and engage in
certain other activities. In addition, the New Credit Facilities require us to
maintain certain financial ratios. Indebtedness under the New Credit Facilities
is secured by substantially all of our assets, including our real and personal
property, inventory, accounts receivable, intellectual property, and other
intangibles.


Net Cash Provided by Operating Activities

Net cash provided by operating activities was $23.4 million for the nine months
ended September 30, 2001, a decrease of $25.1 million, or 52%, from the same
period in 2000. The decrease resulted primarily from changes in working capital
partially offset by an increase in operating income.


Net Cash Used in Investing Activities

Net cash used in investing activities was $87.6 million for the nine months
ended September 30, 2001, compared to $40.1 million for the same period in 2000.
Acquisition of Uniplast excluding cash amounted to $55.5 million. Capital
expenditures were $40 million and $40.1 million for the nine months ended
September 30, 2001 and 2000, respectively. Capital expenditures in both periods
were primarily for major expansion projects in all of our product lines, for
upgrading our information systems, and for several new and carryover maintenance
projects throughout our company. In 2001, we received $7.9 million as part of a
sale-leaseback transaction of newly-acquired machinery and equipment.


Net Cash Provided By Financing Activities

Net cash provided by financing activities was $61.0 million for the nine months
ended September 30, 2001, compared to a use of funds for financing activities of
$2.7 million for the same period in 2000. The activity for the nine months ended
September 30, 2001 primarily represented issuance of preferred stock and common
stock for the acquisition of Uniplast and principal payments and revolving debt
borrowings on the New Credit Facilities. In 2001, we prepaid $8.0 million of
principal on our term loans under the New Credit Facilities. The


                                       32
<PAGE>

activity for the nine months ended September 30, 2000 represented payments and
borrowings on the Prior and New Credit Facilities and the financing transactions
related to the 2000 Recapitalization.


Liquidity

As of September 30, 2001, we had approximately $70.5 million of working capital
and approximately $70.9 million available under our $100.0 million Revolving
Credit Facility. We had $5.0 million of letters of credit issued, which reduces
the amount available for borrowings under our Revolving Credit Facility. As of
September 30, 2001, the debt under the New Credit Facilities bore interest at a
weighted average rate of 9.0%.

As of September 30, 2001, we had $3.8 million in cash and cash equivalents, of
which the majority was held by our foreign subsidiaries. The effective tax rate
of repatriating this money and future foreign earnings to the United States
varies from approximately 25% to 45%, depending on various U.S. and foreign tax
factors, including each foreign subsidiary's country of incorporation. High
effective repatriation tax rates may limit our ability to access cash and cash
equivalents generated by our foreign operations for use in our United States
operations, including to pay principal, premium, if any, and interest on the
Notes and the New Credit Facilities. For the nine months ended September 30,
2001, our foreign operations generated net income from continuing operations of
approximately $4.8 million.

Interest expense and scheduled principal payments on our borrowings under the
New Credit Facilities and the Notes have significantly increased our future
liquidity requirements. We expect that cash flows from operating activities and
available borrowings under the New Credit Facilities will provide sufficient
working capital to operate our business, to make expected capital expenditures
and to meet foreseeable liquidity requirements. If we were to engage in a
significant acquisition transaction, however, it may be necessary for us to
restructure our existing credit arrangements.


CAUTIONARY STATEMENT FOR FORWARD-LOOKING INFORMATION

Certain information set forth in this report contains "forward-looking
statements" within the meaning of federal securities laws. Forward-looking
statements include statements concerning our plans, objectives, goals,
strategies, future events, future revenues or performance, capital expenditures,
financing needs, plans or intentions relating to acquisitions, business trends,
and other information that is not historical information. When used in this
report, the words "estimates," "expects," "anticipates," "forecasts," "plans,"
"intends," "believes" and variations of such words or similar expressions are
intended to identify forward-looking statements. We may also make additional
forward-looking statements from time to time. All such subsequent
forward-looking statements, whether written or oral, by us or on our behalf, are
also expressly qualified by these cautionary statements.

All forward-looking statements, including, without limitation, management's
examination of historical operating trends, are based upon our current
expectations and various assumptions. Our expectations, beliefs and projections
are expressed in good faith and we believe there is a reasonable basis for them.
But, there can be no assurance that management's expectations, beliefs and
projections will result or be achieved. All forward-looking statements apply
only as of the date made. We undertake no obligation to publicly update or
revise forward-looking statements which may be made to reflect events or
circumstances after the date made or to reflect the occurrence of unanticipated
events.

There are a number of risks and uncertainties that could cause our actual
results to differ materially from the forward-looking statements contained in or
contemplated by this report. The following risks and uncertainties, together
with those discussed in our Registration Statement on Form S-1 declared
effective by the Securities and Exchange Commission on August 10, 2001, are
among the factors that could cause our actual results to differ materially from
the forward-looking statements. There may be other factors, including those
discussed

                                       33
<PAGE>

elsewhere in this report, that may cause our actual results to differ
materially from the forward-looking statements. Any forward-looking statements
should be considered in light of these factors.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to various interest rate and resin price risks that arise in the
normal course of business. We finance our operations with borrowings comprised
primarily of variable rate indebtedness. We enter into interest rate collar and
swap agreements to manage interest rate market risks and commodity collar
agreements to manage resin market risks. Our raw material costs are comprised
primarily of resins. Significant increases in interest rates or the price of
resins could adversely affect our operating margins, results of operations and
ability to service our indebtedness. An increase of 1% in interest rates payable
on our variable rate indebtedness would increase our annual interest expense by
approximately $4.1 million.

In the first quarter of 2001, we entered into certain interest rate collars,
caps and swaps. We adopted SFAS No. 133 to account for these instruments as of
January 1, 2001. Under the conditions of our credit facilities, we are required
to obtain interest rate protection on 50% of our entire debt. See Note 7 to the
condensed consolidated financial statement contained elsewhere in this report.

As a result of the mandatory redemption features, the carrying value of the
Preferred Stock is increased each quarter to reflect accretion towards the
$131.0 million redemption value at May 31, 2011, excluding accumulated
dividends. The accretion for the nine months ended September 30, 2001 was $1.0
million. As of September 30, 2001, we have accrued dividends of approximately
$21.0 million which is included as part of the liquidation value of the
Preferred Stock.



                                       34
<PAGE>


                           PART II. OTHER INFORMATION


ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS

         On July 16, 2001, we issued the following equity securities in
connection with (a) our acquisition of 100% of the outstanding shares of common
stock of Uniplast Holdings Inc. pursuant to the stock purchase agreement dated
as of June 15, 2001 and (b) the refinancing of a portion of the debt of Uniplast
that we assumed as part of the acquisition consideration:

     o   34,677 shares of our common stock to the selling shareholders of
         Uniplast (of which 3,468 shares valued at approximately $1.7 million
         are subject to certain holdback arrangements and had not been delivered
         at closing or as of the date hereof); and

     o   29,000 shares of our Series A Cumulative Exchangeable Redeemable
         Preferred Stock, no par value (the "Preferred Stock"), and warrants
         (the "Preferred Stock Warrants") to purchase an additional 29,436
         shares of our common stock to Southwest Films, LLC and certain other
         securityholders for which we received cash consideration of
         approximately $29.0 million in the aggregate. The Preferred Stock
         Warrants are exercisable at any time prior to May 31, 2011 at an
         exercise price of $0.01 per share. Each Preferred Stock Warrant
         entitles the holder to purchase 1.015 shares of common stock.

         On September 13, 2001, we issued 1,579 shares of our Preferred Stock
and Preferred Stock Warrants to purchase an additional 1,603 shares of our
common stock to certain holders of our common stock to whom we were obligated to
make a preemptive rights offering. We received cash consideration of
approximately $1.579 million in the aggregate for such securities. The Preferred
Stock Warrants are exercisable at any time prior to May 31, 2011 at an exercise
price of $0.01 per share. Each Preferred Stock Warrant entitles the holder to
purchase 1.015 shares of common stock.

         In addition, on September 13, 2001, we issued 404 shares of our
Preferred Stock and Preferred Stock Warrants to purchase an additional 410
shares of our common stock to members of our senior management. We received cash
consideration of approximately $404,000 in the aggregate for such securities.
The Preferred Stock Warrants are exercisable at any time prior to May 31, 2011
at an exercise price of $0.01 per share. Each Preferred Stock Warrant entitles
the holder to purchase 1.015 shares of common stock.

We believe that the foregoing issuance of our equity securities in the third
quarter of 2001 did not involve a public offering or sale of securities and were
exempt from the registration requirements of the Securities Act pursuant to the
exemption from registration afforded by Section 4(2) of the Securities Act or
Regulation D promulgated thereunder. No underwriters, brokers or finders were
involved in any of these transactions.


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

       (a)   Exhibits:

EXHIBIT NO.                EXHIBIT
-----------                -------
4.1             First Supplement Indenture, dated as of July 16, 2001, among
                Pliant Corporation, the New Note Guarantors party thereto,
                the existing Note Guarantors party thereto and The Bank of
                New York, as trustee (incorporated by reference to Exhibit
                4.3 to Pliant Corporation's Registration Statement on Form
                S-4 (File No. 333-65754)).


                                       35
<PAGE>

EXHIBIT NO.                EXHIBIT
-----------                -------

10.1            Amendment No. 1 and Waiver dated as of July 16, 2001 to the
                Stockholder's Agreement, dated as of May 31, 2000, among Pliant
                Corporation, Chase Domestic Investments, L.L.C. and each of the
                stockholders and warrantholders listed on the signature pages
                thereto (incorporated by reference to Exhibit 10.3 to Pliant
                Corporation's Registration Statement on Form S-4 (File No.
                333-65754)).

10.2            Amendment No. 1 and Waiver dated as of July 16, 2001 to the
                Securities Purchase Agreement dated as of May 31, 2000 among
                Pliant Corporation, and each of the purchasers of Pliant
                Corporation's preferred stock listed on the signature pages
                thereto (incorporated by reference to Exhibit 10.7 to Pliant
                Corporation's Registration Statement on Form S-4 (File No.
                333-65754)).

10.3            Amendment No. 1 dated as of July 16, 2001 to the Warrant
                Agreement dated as of May 31, 2000 among Pliant Corporation and
                the initial warrantholders listed in Schedule I thereto
                (incorporated by reference to Exhibit 10.9 to Pliant
                Corporation's Registration Statement on Form S-4 (File No.
                333-65754)).

10.4            Securities Purchase Agreement dated as of July 16, 2001 among
                Pliant Corporation and the purchasers of Pliant Corporation's
                preferred stock listed on the schedules thereto (incorporated by
                reference to Exhibit 10.10 to Pliant Corporation's Registration
                Statement on Form S-4 (File No. 333-65754)).

10.5            Amendment No. 2, dated as of July 10, 2001, to the Credit
                Agreement dated as of September 30, 1997, as amended and
                restated as of May 31, 2000 (incorporated by reference to
                Exhibit 10.13 to Pliant Corporation's Registration Statement on
                Form S-4 (File No. 333-65754)).

10.6            Supplement No. 1, dated as of July 19, 2001, to the
                Guarantee Agreement, dated as of September 30, 1997, as
                amended and restated as of May 31, 2000, among Pliant
                Corporation, each of the subsidiaries listed on Schedule I
                thereto and Bankers Trust Company, as Administrative Agent
                (incorporated by reference to Exhibit 10.15 to Pliant
                Corporation's Registration Statement on Form S-4 (File No.
                333-65754)).

10.7            Supplement No. 1, dated as of July 19, 2001, to the Security
                Agreement, dated as of September 30, 1997, as amended and
                restated as of May 31, 2000, among Pliant Corporation, each
                of the subsidiaries listed on Schedule I thereto and Bankers
                Trust Company, as Collateral Agent (incorporated by
                reference to Exhibit 10.17 to Pliant Corporation's
                Registration Statement on Form S-4 (File No. 333-65754)).

10.8            Supplement No. 1, dated as of July 19, 2001, to the Pledge
                Agreement, dated as of September 30, 1997, as amended and
                restated as of May 31, 2000, among Pliant Corporation, each
                of the subsidiaries listed on Schedule I thereto and Bankers
                Trust Company, as Collateral Agent (incorporated by
                reference to Exhibit 10.19 to Pliant Corporation's
                Registration Statement on Form S-4 (File No. 333-65754)).

                                       36
<PAGE>

EXHIBIT NO.                EXHIBIT
-----------                -------
10.9            Supplement No. 1, dated as of July 19, 2001, to the
                Indemnity, Subrogation and Contribution Agreement, dated as
                of September 30, 1997, as amended and restated as of May 31,
                2000, among Pliant Corporation, each of the subsidiaries
                listed on Schedule I thereto and Bankers Trust Company, as
                Collateral Agent (incorporated by reference to Exhibit 10.21
                to Pliant Corporation's Registration Statement on Form S-4
                (File No. 333-65754)).



         (b) We filed a current report on Form 8-K dated July 18, 2001 to
         announce the completion of our acquisition of all of the outstanding
         shares of Uniplast Holdings Inc.

                                       37

<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.

                              PLIANT CORPORATION



                              /s/ Brian E. Johnson
                              -----------------------------------
                              BRIAN E. JOHNSON
                              Executive Vice President and
                              Chief Financial Officer
                              (Authorized Signatory and
                              Principal Financial and Accounting Officer)




Date: November 13, 2001





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