Document:

Exhibit 10.5

                           CANADIAN PLEDGE AGREEMENT

            CANADIAN PLEDGE AGREEMENT dated as of January 4, 2006 (as it may
be amended, restated, supplemented or modified from time to time, this
"Agreement"), among the entities listed on the signature page hereof
(collectively referred to as the "Pledgors" and individually as a "Pledgor")
and GENERAL ELECTRIC CAPITAL CORPORATION, as collateral agent (in such
capacity, the "Collateral Agent") for the Secured Parties (as defined in the
Credit Agreement referred to below).

            WHEREAS, Pliant Corporation (the "Parent Borrower"), the Domestic
Subsidiary Borrowers (as defined therein), the Lenders party thereto (the
"Lenders"), and General Electric Capital Corporation, as Administrative Agent
and Collateral Agent, are parties to that certain Senior Secured, Super
Priority, Priming Debtor-In-Possession Credit Agreement dated as of January 4,
2006 (as amended, restated, supplemented or otherwise modified from time to
time prior to the date hereof, the "Credit Agreement");

            WHEREAS, the Lenders have agreed to make Loans to the Borrowers
and the Issuing Bank has agreed to issue Letters of Credit for the account of
the Parent Borrower, pursuant to, and upon the terms and subject to the
conditions specified in, the Credit Agreement; the Pledgors have agreed to
guarantee, among other things, all the obligations of the Borrowers under the
Credit Agreement;

            WHEREAS, the obligations of the Lenders to make Loans and of the
Issuing Bank to issue Letters of Credit are conditioned upon, among other
things, the execution and delivery by the Pledgors of a Canadian Pledge
Agreement in the form hereof to secure (a) the due and punctual payment by the
Borrowers of (i) the principal of and premium, if any, and interest (including
interest accruing during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding) on the Loans, when and as due, whether at
maturity, by acceleration, upon one or more dates set for prepayment or
otherwise, (ii) each payment required to be made by the Borrowers under the
Credit Agreement in respect of any Letter of Credit, when and as due,
including payments in respect of reimbursement of disbursements, interest
thereon and obligations to provide cash collateral and (iii) all other
monetary obligations, including fees, costs, expenses and indemnities, whether
primary, secondary, direct, contingent, fixed or otherwise (including monetary
obligations incurred during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding), of each Loan Party to the Secured Parties under
the Credit Agreement and the other Loan Documents, (b) the due and punctual
performance of all covenants, agreements, obligations and liabilities of each
Loan Party under or pursuant to the Credit Agreement and the other Loan
Documents, (c) the due and punctual payment and performance of all obligations
of the Borrowers, monetary or otherwise, under each Swap Agreement that (i) is
effective on the Effective Date with a counterparty that is a Lender (or an
affiliate of a Lender) as of the Effective Date or (ii) is entered into after
the Effective Date with any counterparty that is a Lender (or an Affiliate
thereof) at the time such Swap Agreement is entered into and (d) the due and
punctual payment and performance of all monetary obligations of each Loan
Party in respect of overdrafts and related liabilities owed to any of the
Lenders (or any Affiliates thereof) arising from treasury, depositary and cash
management services or in connection with any automated clearinghouse

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transfers of funds (all the monetary and other obligations referred to in the
preceding clauses (a) through (d) being referred to collectively as the
"Obligations").

            ACCORDINGLY, each of the Pledgors and the Collateral Agent, on
behalf of itself and each Secured Party (and each of their respective
successors or assigns), hereby agrees to amend and restate the Prior Canadian
Pledge Agreement as follows:

            SECTION 1. Pledge. As general and continuing collateral security
for the payment and performance, as the case may be, in full of the
Obligations, each Pledgor hereby transfers, grants, bargains, sells, conveys,
hypothecates, pledges, sets over and delivers unto the Collateral Agent, its
successors and assigns, and hereby grants to the Collateral Agent, its
successors and assigns, for the ratable benefit of the Secured Parties, a
continuing security interest in all of the Pledgor's right, title and interest
in, to and under (a) the shares of capital stock and other Equity Interests
owned by it and listed on Schedule II hereto and any Equity Interests obtained
in the future by the Pledgor and the certificates representing all such shares
(the "Pledged Stock"); (b)(i) the debt securities listed opposite the name of
the Pledgor on Schedule II hereto, (ii) any debt securities in the future
issued to the Pledgor and (iii) the promissory notes and any other instruments
evidencing such debt securities (the "Pledged Debt Securities"); (c) subject
to Section 5, all payments of principal or interest, dividends, cash,
instruments and other property from time to time received, receivable or
otherwise distributed, in respect of, in exchange for or upon the conversion
of the securities referred to in clauses (a) and (b) above; (d) subject to
Section 5, all rights and privileges of the Pledgor with respect to the
securities and other property referred to in clauses (a), (b), and (c) above,
including any interest of such Pledgor in the entries on the books of the
issuer of the Pledged Stock or any financial intermediary pertaining to the
Pledged Stock; and (e) all proceeds of any of the foregoing (the items
referred to in clauses (a) through (e) above being collectively referred to as
the "Collateral"). Notwithstanding any of the foregoing, the Pledged Stock
shall not include (i) more than 65% of the issued and outstanding shares of
common stock of any Foreign Subsidiary that is not a Loan Party, (ii) to the
extent that applicable law requires that a Subsidiary of the Pledgor issue
directors' or nominee's qualifying shares, such qualifying shares, or (iii)
any shares or other Equity Interests or debt securities issued by any Excluded
Subsidiary.

            Any stock certificates, notes or other securities now or hereafter
included in the Collateral (the "Pledged Securities") shall be accompanied by
(a) stock powers of attorney duly executed in blank or other instruments of
transfer satisfactory to the Collateral Agent and by such other instruments
and documents as the Collateral Agent may reasonably request and (b) all other
property comprising part of the Collateral shall be accompanied by proper
instruments of assignment duly executed by the applicable Pledgor and such
other instruments or documents as the Collateral Agent may reasonably request.
Each delivery of Pledged Securities shall be accompanied by a schedule
describing the securities then being pledged hereunder, which schedule shall
be attached hereto as Schedule II and made a part hereof. Each schedule so
delivered shall supplement any prior schedules so delivered. If the constating
documents of any Person listed under the heading "Issuer" in Schedule II
hereto restrict the transfer of the securities of such Issuer, then the
Pledgor will also deliver to the Collateral Agent a certified copy of a
resolution of the directors or shareholders of such Issuer consenting to the
transfer(s) contemplated by this Agreement, including any prospective transfer
of the Collateral by the

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Collateral Agent upon a realization on the security constituted hereby in
accordance with this Agreement.

            Each Pledgor confirms that value has been given by the Collateral
Agent and the Secured Parties to the Pledgor, that the Pledgor has rights in
the Collateral (other than after-acquired property) and that the Pledgor and
the Collateral Agent have not agreed to postpone the time for attachment of
the security interests created by this Agreement to any of the Collateral. The
security interests created by this Agreement will have effect and be deemed to
be effective whether or not the Obligations or any part thereof are owing or
in existence before or after or upon the date of this Agreement.

            TO HAVE AND TO HOLD the Collateral, together with all right,
title, interest, powers, privileges and preferences pertaining or incidental
thereto, unto the Collateral Agent, its successors and assigns, for the
ratable benefit of the Secured Parties, forever; subject, however, to the
terms, covenants and conditions hereinafter set forth.

            SECTION 2. Delivery of the Collateral. (a) Each Pledgor agrees
promptly to deliver or cause to be delivered to the Collateral Agent any and
all Pledged Securities, and any and all certificates or other instruments or
documents representing the Collateral that have not been provided to the
Pre-Petition Collateral Agent prior to the date hereof.

            (b) Each Pledgor will cause any Indebtedness for borrowed money
owed to the Pledgor by the Parent Borrower or any Subsidiary to be evidenced
by a duly executed promissory note that is pledged and delivered to the
Collateral Agent pursuant to the terms hereof.

            SECTION 3. Representations, Warranties and Covenants. Each Pledgor
hereby represents, warrants and covenants, as to itself and the Collateral
pledged by it hereunder, to and with the Collateral Agent that:

            (a) the Pledged Stock represents that percentage as set forth on
Schedule II of the issued and outstanding shares of each class of the capital
stock of the issuer with respect thereto;

            (b) except for the security interest granted hereunder and except
as permitted by the Credit Agreement, the Pledgor (i) is and will at all times
continue to be the direct owner, beneficially and of record, of the Pledged
Securities indicated on Schedule II, (ii) holds the same free and clear of all
Liens, (iii) will make no assignment, pledge, hypothecation or transfer of, or
create or permit to exist any security interest in or other Lien on, the
Collateral, other than pursuant hereto and (iv) subject to Section 5, will
cause any and all Collateral, whether for value paid by the Pledgor or
otherwise, to be forthwith deposited with the Collateral Agent and pledged or
assigned hereunder;

            (c) the Pledgor (i) has the power and authority to pledge the
Collateral in the manner hereby done or contemplated and to execute, deliver
and perform its obligations under this Agreement, and such execution, delivery
and performance does not contravene any of the Pledgor's constating documents
or any agreement, instrument or restriction to which the Pledgor is a party or
by which the Pledgor or any of the Collateral is bound and (ii) will defend
its title or

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interest thereto or therein against any and all Liens (other than the Lien
created by this Agreement), however arising, of all Persons whomsoever;

            (d) no consent which has not been obtained of any other Person
(including stockholders or creditors of any Pledgor) and no consent or
approval which has not been obtained of any Governmental Authority or any
securities exchange is necessary to the validity of the pledge effected
hereby;

            (e) by virtue of the execution and delivery by the Pledgors of
this Agreement, when the Pledged Securities, certificates or other documents
representing or evidencing the Collateral are delivered to the Collateral
Agent in accordance with this Agreement, the Collateral Agent will obtain a
valid and perfected first lien upon and security interest in such Pledged
Securities as security for the payment and performance of the Obligations;

            (f) the pledge effected hereby is effective to vest in the
Collateral Agent, on behalf of the Secured Parties, the rights of the
Collateral Agent in the Collateral as set forth herein;

            (g) all of the Pledged Stock has been duly authorized and validly
issued and is fully paid and nonassessable;

            (h) all information set forth herein relating to the Pledged Stock
is accurate and complete in all material respects as of the date hereof;

            (i) the pledge of the Pledged Stock pursuant to this Agreement
does not violate Regulation U or X of the Federal Reserve Board or any
successor thereto as of the date hereof;

            (j) this Agreement had been duly authorized, executed and
delivered by the Pledgor and is a valid and binding obligation of the Pledgor
enforceable against the Pledgor in accordance with its terms, subject only to
bankruptcy, insolvency, liquidation reorganization, moratorium and other
similar laws generally affecting the enforcement of creditor rights, and to
the fact that equitable remedies (such as specific performance and injunction)
are discretionary remedies; and

            (k) there is no existing agreement, option, right or privilege
capable of becoming an agreement or option pursuant to which the Pledgor would
be required to sell or otherwise dispose of any of the Pledged Securities.

            SECTION 4. Registration in Nominee Name; Denominations. The
Collateral Agent, on behalf of the Secured Parties, shall have the right (in
its sole and absolute discretion) to hold the Pledged Securities in its own
name as pledgee, the name of its nominee (as pledgee or as sub-agent) or the
name of the Pledgors, endorsed or assigned in blank or in favor of the
Collateral Agent. Each Pledgor will promptly give to the Collateral Agent
copies of any notices or other communications received by it with respect to
Pledged Securities registered in the name of such Pledgor. The Collateral
Agent shall at all times have the right to exchange the certificates
representing Pledged Securities for certificates of smaller or larger
denominations for any purpose consistent with this Agreement.

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            If any securities, whether certificated or uncertificated, or
other investment property now or hereafter acquired by any Pledgor are held by
such Pledgor or its nominee through a securities intermediary or commodity
intermediary, such Pledgor shall promptly notify the Collateral Agent thereof
and, at the Collateral Agent's request and option, pursuant to an agreement in
form and substance reasonably satisfactory to the Collateral Agent, either (i)
cause such securities intermediary or (as the case may be) commodity
intermediary to agree to comply with entitlement orders or other instructions
from the Collateral Agent to such securities intermediary as to such security
entitlements, or (as the case may be) to apply any value distributed on
account of any commodity contract as directed by the Collateral Agent to such
commodity intermediary, in each case without further consent of any Pledgor or
such nominee, or (ii) in the case of Financial Assets or other Investment
Property (each as defined in the Canadian Security Agreement dated as of the
date hereof between the Pledgors and the Collateral Agent) held through a
securities intermediary, arrange for the Collateral Agent to become the
entitlement holder with respect to such investment property, with the Pledgor
being permitted, only with the consent of the Collateral Agent, to exercise
rights to withdraw or otherwise deal with such investment property. The
Collateral Agent agrees with each of the Pledgors that the Collateral Agent
shall not give any such entitlement orders or instructions or directions to
any such issuer, securities intermediary or commodity intermediary, and shall
not withhold its consent to the exercise of any withdrawal or dealing rights
by any Pledgor, unless an Event of Default has occurred and is continuing, or,
after giving effect to any such investment and withdrawal rights would occur.
The provisions of this paragraph shall not apply to any financial assets
credited to a securities account for which the Collateral Agent is the
securities intermediary.

            SECTION 5. Voting Rights; Dividends and Interest, etc. (a) Unless
and until an Event of Default shall have occurred and be continuing:

            (i) Each Pledgor shall be entitled to exercise any and all voting
      and/or other consensual rights and powers inuring to an owner of Pledged
      Securities or any part thereof for any purpose consistent with the terms
      of this Agreement, the Credit Agreement and the other Loan Documents;
      provided, however, that such Pledgor will not be entitled to exercise
      any such right if the result thereof could materially and adversely
      affect the rights inuring to a holder of the Pledged Securities or the
      rights and remedies of any of the Secured Parties under this Agreement
      or the Credit Agreement or any other Loan Document or the ability of the
      Secured Parties to exercise the same.

            (ii) The Collateral Agent shall execute and deliver to each
      Pledgor, or cause to be executed and delivered to each Pledgor, all such
      proxies, powers of attorney and other instruments as such Pledgor may
      reasonably request for the purpose of enabling such Pledgor to exercise
      the voting and/or consensual rights and powers it is entitled to
      exercise pursuant to subparagraph (i) above and to receive the cash
      dividends it is entitled to receive pursuant to subparagraph (iii)
      below.

            (iii) Each Pledgor shall be entitled to receive and retain any and
      all cash dividends, interest and principal paid on the Pledged
      Securities to the extent and only to the extent that such cash
      dividends, interest and principal are permitted by, and otherwise paid
      in accordance with, the terms and conditions of the Credit Agreement,
      the other

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      Loan Documents and applicable laws. All noncash dividends, interest and
      principal, and all dividends, interest and principal paid or payable in
      cash or otherwise in connection with a partial or total liquidation or
      dissolution, return of capital, capital surplus or paid-in surplus, and
      all other distributions (other than distributions referred to in the
      preceding sentence) made on or in respect of the Pledged Securities,
      whether paid or payable in cash or otherwise, whether resulting from a
      subdivision, combination or reclassification of the outstanding capital
      stock of the issuer of any Pledged Securities or received in exchange
      for Pledged Securities or any part thereof, or in redemption thereof, or
      as a result of any merger, consolidation, acquisition or other exchange
      of assets to which such issuer may be a party or otherwise, shall be and
      become part of the Collateral, and, if received by any Pledgor, shall
      not be commingled by such Pledgor with any of its other funds or
      property but shall be held separate and apart therefrom, shall be held
      in trust for the benefit of the Collateral Agent and shall be forthwith
      delivered to the Collateral Agent in the same form as so received (with
      any necessary endorsement).

            (b) Upon the occurrence and during the continuance of an Event of
Default, all rights of any Pledgor to dividends, interest or principal that
such Pledgor is authorized to receive pursuant to paragraph (a)(iii) above
shall cease, and all such rights shall thereupon become vested in the
Collateral Agent, which shall have the sole and exclusive right and authority
to receive and retain such dividends, interest or principal. All dividends,
interest or principal received by the Pledgor contrary to the provisions of
this Section 5 shall be held in trust for the benefit of the Collateral Agent,
shall be segregated from other property or funds of such Pledgor and shall be
forthwith delivered to the Collateral Agent upon demand in the same form as so
received (with any necessary endorsement). Any and all money and other
property paid over to or received by the Collateral Agent pursuant to the
provisions of this paragraph (b) shall be retained by the Collateral Agent, in
an account to be established by the Collateral Agent upon receipt of such
money or other property and shall be applied in accordance with the provisions
of Section 7. After all Events of Default have been cured or waived, the
Collateral Agent shall, within five Business Days after all such Events of
Default have been cured or waived, repay to each Pledgor all cash dividends,
interest or principal (without interest), that such Pledgor would otherwise be
permitted to retain pursuant to the terms of paragraph (a)(iii) above and
which remain in such account.

            (c) Upon the occurrence and during the continuance of an Event of
Default, all rights of any Pledgor to exercise the voting and consensual
rights and powers it is entitled to exercise pursuant to paragraph (a)(i) of
this Section 5, and the obligations of the Collateral Agent under paragraph
(a)(ii) of this Section 5, shall cease, and all such rights shall thereupon
become vested in the Collateral Agent, which shall have the sole and exclusive
right and authority to exercise such voting and consensual rights and powers,
provided that, unless otherwise directed by the Required Lenders, the
Collateral Agent shall have the right from time to time following and during
the continuance of an Event of Default to permit the Pledgors to exercise such
rights. After all Events of Default have been cured or waived, such Pledgor
will have the right to exercise the voting and consensual rights and powers
that it would otherwise be entitled to exercise pursuant to the terms of
paragraph (a)(i) above.

            SECTION 6. Remedies upon Default. Upon the occurrence and during
the continuance of an Event of Default, subject to applicable regulatory and
legal requirements and

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the terms of the Interim Order and the Final Order, the Collateral Agent may
exercise all of the rights and remedies granted to secured parties under the
Personal Property Security Act (Ontario) (the "PPSA") and any other applicable
statute, or otherwise available to the Collateral Agent at law or in equity.
Without limiting the generality of the forgoing, the Collateral Agent may sell
the Collateral, or any part thereof, at public or private sale or at any
broker's board or on any securities exchange, for cash, upon credit or for
future delivery as the Collateral Agent shall deem appropriate and pursuant to
the Interim Order, the Canadian Interim Order, the Final Order and the Final
Canadian Order, the automatic stay of Section 362 of the Bankruptcy Code or
the Canadian Stay Order shall be modified and vacated to permit Collateral
Agent to exercise its remedies under this Agreement and the Loan Documents,
without further application or motion to, or order from, the Bankruptcy Court
or the Canadian Court; provided, however, notwithstanding anything to the
contrary contained herein, Collateral Agent shall be permitted to exercise any
remedy in the nature of a liquidation of, or foreclosure on, any interest of
any Pledgor in the Collateral only upon three (3) Business Days' prior written
notice to such Pledgor and counsel approved by the Bankruptcy Court for the
Committee. The Collateral Agent shall be authorized at any such sale (if it
deems it advisable to do so) to restrict the prospective bidders or purchasers
to persons who will represent and agree that they are purchasing the
Collateral for their own account for investment and not with a view to the
distribution or sale thereof, and upon consummation of any such sale the
Collateral Agent shall have the right to assign, transfer and deliver to the
purchaser or purchasers thereof the Collateral so sold. Each such purchaser at
any such sale shall hold the property sold absolutely free from any claim or
right on the part of any Pledgor, and, to the extent permitted by applicable
law, the Pledgors hereby waive all rights of redemption, stay, valuation and
appraisal any Pledgor now has or may at any time in the future have under any
rule of law or statute now existing or hereafter enacted. Upon the occurrence
and during the continuance of an Event of Default and the exercise by
Collateral Agent of its rights and remedies under this Agreement and the other
Loan Documents, the Pledgors shall assist Collateral Agent in effecting a sale
or other disposition of the Collateral upon such terms as are designed to
maximize the proceeds obtainable from such sale or other disposition.

            The Collateral Agent shall give a Pledgor such prior written
notice of the Collateral Agent's intention to make any sale of such Pledgor's
Collateral as may be required by the PPSA or other applicable law. Such
notice, in the case of a public sale, shall state the time and place for such
sale and, in the case of a sale at a broker's board or on a securities
exchange, shall state the board or exchange at which such sale is to be made
and the day on which the Collateral, or portion thereof, will first be offered
for sale at such board or exchange. Any such public sale shall be held at such
time or times within ordinary business hours and at such place or places as
the Collateral Agent may fix and state in the notice of such sale. At any such
sale, the Collateral, or portion thereof, to be sold may be sold in one lot as
an entirety or in separate parcels, as the Collateral Agent may (in its sole
and absolute discretion) determine. The Collateral Agent shall not be
obligated to make any sale of any Collateral if it shall determine not to do
so, regardless of the fact that notice of sale of such Collateral shall have
been given. The Collateral Agent may, without notice or publication, adjourn
any public or private sale or cause the same to be adjourned from time to time
by announcement at the time and place fixed for sale, and such sale may,
without further notice, be made at the time and place to which the same was so
adjourned. In case any sale of all or any part of the Collateral is made on
credit or for future delivery, the Collateral so sold may be retained by the
Collateral Agent until the sale price is paid in full by the purchaser or
purchasers thereof, but the Collateral Agent shall not incur any

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liability in case any such purchaser or purchasers shall fail to take up and
pay for the Collateral so sold and, in case of any such failure, such
Collateral may be sold again upon like notice. At any public (or, to the
extent permitted by applicable law, private) sale made pursuant to this
Section 6, any Secured Party may bid for or purchase, free from any right of
redemption, stay or appraisal on the part of any Pledgor (all said rights
being also hereby waived and released), the Collateral or any part thereof
offered for sale and may make payment on account thereof by using any claim
then due and payable to it from such Pledgor as a credit against the purchase
price, and it may, upon compliance with the terms of sale, hold, retain and
dispose of such property without further accountability to such Pledgor
therefor. For purposes hereof, (a) a written agreement to purchase the
Collateral or any portion thereof shall be treated as a sale thereof, (b) the
Collateral Agent shall be free to carry out such sale pursuant to such
agreement and (c) such Pledgor shall not be entitled to the return of the
Collateral or any portion thereof subject thereto, notwithstanding the fact
that after the Collateral Agent shall have entered into such an agreement all
Events of Default shall have been remedied and the Obligations paid in full.
As an alternative to exercising the power of sale herein conferred upon it,
the Collateral Agent may proceed by a suit or suits at law or in equity to
foreclose upon the Collateral and to sell the Collateral or any portion
thereof pursuant to a judgment or decree of a court or courts having competent
jurisdiction or pursuant to a proceeding by a court-appointed receiver.

            SECTION 7. Application of Proceeds of Sale. The proceeds of any
sale of Collateral pursuant to Section 6, as well as any Collateral consisting
of cash, shall be applied by the Collateral Agent pursuant to Section 2.17(b)
of the Credit Agreement.

            SECTION 8. Reimbursement of Collateral Agent. (a) The Pledgors
agree to pay upon demand to the Collateral Agent the amount of any and all
reasonable expenses, including the reasonable fees, other charges and
disbursements of its counsel and of any experts or agents, that the Collateral
Agent may incur in connection with (i) the administration of this Agreement,
(ii) the custody or preservation of, or the sale of, collection from, or other
realization upon, any of the Collateral, (iii) the exercise or enforcement of
any of the rights of the Collateral Agent hereunder or (iv) the failure by
such Pledgor to perform or observe any of the provisions hereof.

            (b) Without limitation of its indemnification obligations under
the other Loan Documents, each Pledgor agrees to indemnify the Collateral
Agent and the Indemnities (as defined in Section 10.03 of the Credit
Agreement) against, and hold each Indemnitee harmless from, any and all
losses, claims, damages, liabilities and related expenses, including
reasonable counsel fees, other charges and disbursements, incurred by or
asserted against any Indemnitee arising out of, in any way connected with, or
as a result of (i) the execution or delivery of this Agreement or any other
Loan Document or any agreement or instrument contemplated hereby or thereby,
the performance by the parties hereto of their respective obligations
thereunder or the consummation of the Transactions and the other transactions
contemplated thereby or (ii) any claim, litigation, investigation or
proceeding relating to any of the foregoing, whether or not any Indemnitee is
a party thereto, provided that such indemnity shall not, as to any Indemnitee,
be available to the extent that such losses, claims, damages, liabilities or
related expenses resulted from the gross negligence or wilful misconduct of
such Indemnitee.

            (c) Any amounts payable as provided hereunder shall be additional
Obligations secured hereby and by the other Security Documents. The provisions
of this Section

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8 shall remain operative and in full force and effect regardless of the
termination of this Agreement, the consummation of the transactions
contemplated hereby, the repayment of any of the Obligations, the invalidity
or unenforceability of any term or provision of this Agreement or any other
Loan Document or any investigation made by or on behalf of the Collateral
Agent or any other Secured Party. All amounts due under this Section 8 shall
be payable on written demand therefor and shall bear interest at the rate
specified in Section 2.12(c) of the Credit Agreement.

            SECTION 9. Collateral Agent Appointed Attorney-in-Fact. Each
Pledgor hereby appoints the Collateral Agent the attorney-in-fact of such
Pledgor, upon the occurrence and during the continuance of a Default, for the
purpose of carrying out the provisions of this Agreement and taking any action
and executing any instrument that the Collateral Agent may deem necessary or
advisable to accomplish the purposes hereof, which appointment is irrevocable
and coupled with an interest. Without limiting the generality of the
foregoing, the Collateral Agent shall have the right, upon the occurrence and
during the continuance of an Event of Default, with full power of substitution
either in the Collateral Agent's name or in the name of such Pledgor, to ask
for, demand, sue for, collect, receive and give acquittance for any and all
moneys due or to become due under and by virtue of any Collateral, to endorse
checks, drafts, orders and other instruments for the payment of money payable
to the Pledgor representing any interest or dividend or other distribution
payable in respect of the Collateral or any part thereof or on account thereof
and to give full discharge for the same, to settle, compromise, prosecute or
defend any action, claim or proceeding with respect thereto, and to sell,
assign, endorse, pledge, transfer and to make any agreement respecting, or
otherwise deal with, the same; provided, however, that nothing herein
contained shall be construed as requiring or obligating the Collateral Agent
to make any commitment or to make any inquiry as to the nature or sufficiency
of any payment received by the Collateral Agent, or to present or file any
claim or notice, or to take any action with respect to the Collateral or any
part thereof or the moneys due or to become due in respect thereof or any
property covered thereby. The Collateral Agent and the other Secured Parties
shall be accountable only for amounts actually received as a result of the
exercise of the powers granted to them herein, and neither they nor their
officers, directors, employees or agents shall be responsible to any Pledgor
for any act or failure to act hereunder, except for their own gross negligence
or wilful misconduct.

            SECTION 10. Waivers; Amendment. (a) No failure or delay of the
Collateral Agent in exercising any power or right hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right or
power, or any abandonment or discontinuance of steps to enforce such a right
or power, preclude any other or further exercise thereof or the exercise of
any other right or power. The rights and remedies of the Collateral Agent
hereunder and of the other Secured Parties under the other Loan Documents are
cumulative and are not exclusive of any rights or remedies that they would
otherwise have. No waiver of any provisions of this Agreement or consent to
any departure by any Pledgor therefrom shall in any event be effective unless
the same shall be permitted by paragraph (b) below, and then such waiver or
consent shall be effective only in the specific instance and for the purpose
for which given. No notice or demand on any Pledgor in any case shall entitle
such Pledgor to any other or further notice or demand in similar or other
circumstances.

                                      9
<PAGE>

            (b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to a written agreement entered into
between the Collateral Agent and the Pledgor or Pledgors with respect to which
such waiver, amendment or modification is to apply, subject to any consent
required in accordance with Section 10.02 of the Credit Agreement.

            SECTION 11. Securities Act, etc. In view of the position of the
Pledgors in relation to the Pledged Securities, or because of other current or
future circumstances, a question may arise under the Securities Act of 1933,
as now or hereafter in effect, or any similar statute hereafter enacted
analogous in purpose or effect (such Act and any such similar statute as from
time to time in effect being called the "Federal Securities Laws") with
respect to any disposition of the Pledged Securities permitted hereunder. Each
Pledgor understands that compliance with the Federal Securities Laws might
very strictly limit the course of conduct of the Collateral Agent if the
Collateral Agent were to attempt to dispose of all or any part of the Pledged
Securities, and might also limit the extent to which or the manner in which
any subsequent transferee of any Pledged Securities could dispose of the same.
Similarly, there may be other legal restrictions or limitations affecting the
Collateral Agent in any attempt to dispose of all or part of the Pledged
Securities under applicable Blue Sky or other state securities laws or similar
laws analogous in purpose or effect. Each Pledgor recognizes that in light of
such restrictions and limitations the Collateral Agent may, with respect to
any sale of the Pledged Securities, limit the purchasers to those who will
agree, among other things, to acquire such Pledged Securities for their own
account, for investment, and not with a view to the distribution or resale
thereof. Each Pledgor acknowledges and agrees that in light of such
restrictions and limitations, the Collateral Agent, in its discretion, (a) may
proceed to make such a sale whether or not a registration statement for the
purpose of registering such Pledged Securities or part thereof shall have been
filed under the Federal Securities Laws and (b) may approach and negotiate
with a single potential purchaser to effect such sale. Each Pledgor
acknowledges and agrees that any such sale might result in prices and other
terms less favorable to the seller than if such sale were a public sale
without such restrictions. In the event of any such sale, the Collateral Agent
shall incur no responsibility or liability for selling all or any part of the
Pledged Securities at a price that the Collateral Agent, in its discretion,
may in good faith deem reasonable under the circumstances, notwithstanding the
possibility that a substantially higher price might have been realized if the
sale were deferred until after registration as aforesaid or if more than a
single purchaser were approached. The provisions of this Section 11 will apply
notwithstanding the existence of a public or private market upon which the
quotations or sales prices may exceed substantially the price at which the
Collateral Agent sells.

            SECTION 12. Registration, etc. Each Pledgor agrees that, upon the
occurrence and during the continuance of an Event of Default hereunder, if for
any reason the Collateral Agent desires to sell any of the Pledged Securities
at a public sale, it will, at any time and from time to time, upon the written
request of the Collateral Agent, use its best efforts to take or to cause the
issuer of such Pledged Securities to take such action and prepare, distribute
and/or file such documents, as are required or advisable in the reasonable
opinion of counsel for the Collateral Agent to permit the public sale of such
Pledged Securities. Each Pledgor further agrees to indemnify, defend and hold
harmless the Collateral Agent, each other Secured Party, any underwriter and
their respective officers, directors, affiliates and controlling persons from
and against all loss, liability, expenses, costs of counsel (including,
without limitation, reasonable fees and expenses to the Collateral Agent of
legal counsel), and claims (including the

                                      10
<PAGE>

costs of investigation) that they may incur insofar as such loss, liability,
expense or claim arises out of or is based upon any untrue statement of a
material fact contained in any prospectus (or any amendment or supplement
thereto) or in any notification or offering circular, or arises out of or is
based upon any omission to state a material fact required to be stated therein
or necessary to make the statements in any thereof not misleading, except
insofar as the same may have been caused by any untrue statement or omission
based upon information furnished to such Pledgor or the issuer of such Pledged
Securities by the Collateral Agent or any other Secured Party expressly for
use therein. Each Pledgor further agrees, upon such written request referred
to above, to use its best efforts to qualify, file or register, or cause the
issuer of such Pledged Securities to qualify, file or register, any of the
Pledged Securities under the Blue Sky or other securities laws of such states
as may be requested by the Collateral Agent and keep effective, or cause to be
kept effective, all such qualifications, filings or registrations. The
Pledgors will bear all costs and expenses of carrying out their obligations
under this Section 12. Each Pledgor acknowledges that there is no adequate
remedy at law for failure by it to comply with the provisions of this Section
12 and that such failure would not be adequately compensable in damages, and
therefore agrees that its agreements contained in this Section 12 may be
specifically enforced.

            SECTION 13. Security Interest Absolute. All rights of the
Collateral Agent hereunder, the grant of a security interest in the Collateral
and all obligations of each Pledgor hereunder, shall be absolute and
unconditional irrespective of (a) any lack of validity or enforceability of
the Credit Agreement, any other Loan Document, any agreement with respect to
any of the Obligations or any other agreement or instrument relating to any of
the foregoing, (b) any change in the time, manner or place of payment of, or
in any other term of, all or any of the Obligations, or any other amendment or
waiver of or any consent to any departure from the Credit Agreement, any other
Loan Document or any other agreement or instrument relating to any of the
foregoing, (c) any exchange, release or nonperfection of any other collateral,
or any release or amendment or waiver of or consent to or departure from any
guaranty, for all or any of the Obligations or (d) any other circumstance that
might otherwise constitute a defense available to, or a discharge of, any
Pledgor in respect of the Obligations or in respect of this Agreement (other
than the indefeasible payment in full of all the Obligations).

            SECTION 14. Termination or Release. (a) This Agreement and the
pledge of Pledged Securities shall continue in effect (notwithstanding the
fact that from time to time there may be no Obligations outstanding) until (i)
the Credit Agreement has terminated pursuant to its express terms and (ii) all
of the Obligations (other than contingent obligations for which no claim has
been made) have been indefeasibly paid and performed in full (or with respect
to any outstanding Letters of Credit, a cash deposit has been delivered to the
Administrative Agent as required by the Credit Agreement) and no commitments
of the Agents or the Lenders which would give rise to any Obligations are
outstanding. Upon payment in full in cash of the outstanding Obligations and
the expiration or termination of the Commitments, the security interest
granted hereby shall terminate and all rights to the Collateral shall revert
to the Pledgors or any other Person entitled thereto. Upon such termination,
the Administrative Agent will authorize the filing of appropriate PPSA
financing change statements and UCC termination statements to discharge or
terminate such security interests and shall, at the expense of the Pledgors,
execute and deliver to such Pledgor such documents as such Pledgor shall
reasonably

                                      11
<PAGE>

request to evidence the discharge or termination of such security interests or
the release of such Collateral, as applicable.

            (b) A Pledgor shall automatically be released from its obligations
hereunder and the pledge of the Collateral of such Pledgor shall be
automatically released in the event that all of the capital stock of such
Pledgor shall be sold, transferred or otherwise disposed of to a Person that
is not an Affiliate of the Parent Borrower in accordance with the terms of the
Credit Agreement; provided that the Required Lenders shall have consented to
such sale, transfer, or other disposition (to the extent required by the
Credit Agreement) and the terms of such consent did not provide otherwise.

            (c) Upon any sale or other transfer by any Pledgor of any
Collateral that is permitted under the Credit Agreement; provided that the
Required Lenders shall have consented to such transaction (to the extent
required by the Credit Agreement) and the terms of such consent did not
provide otherwise, or upon the effectiveness of any written consent of the
release of the security interest granted hereby in any Collateral pursuant to
Section 10.02 of the Credit Agreement, the security interest in such
Collateral shall be automatically released.

            (d) In connection with any termination or release pursuant to
paragraph (a), (b) or (c) above, the Collateral Agent shall execute and
deliver to the Pledgors, at the Pledgors' expense, all PPSA financing change
statements, UCC termination statements and similar documents which the
Pledgors shall reasonably request to evidence such termination or release. Any
execution and delivery of termination statements or release documents pursuant
to this Section 14 shall be without recourse to or warranty by the Collateral
Agent.

            SECTION 15. Notices. All communications and notices hereunder
shall be in writing and given as provided in Section 10.01 of the Credit
Agreement. All communications and notices hereunder to any Pledgor shall be
given to it at the address for notices set forth on Schedule I.

            SECTION 16. Further Assurances. Each Pledgor agrees to do such
further acts and things, and to execute and deliver such additional
conveyances, assignments, agreements and instruments, as the Collateral Agent
may at any time reasonably request in connection with the administration and
enforcement of this Agreement or with respect to the Collateral or any part
thereof or in order better to assure and confirm unto the Collateral Agent its
rights and remedies hereunder.

            SECTION 17. Binding Effect; Several Agreement; Assignments.
Whenever in this Agreement any of the parties hereto is referred to, such
reference shall be deemed to include the successors and assigns of such party;
and all covenants, promises and agreements by or on behalf of any Pledgor that
are contained in this Agreement shall bind and inure to the benefit of its
successors and assigns. This Agreement shall become effective as to any
Pledgor when a counterpart hereof executed on behalf of such Pledgor shall
have been delivered to the Collateral Agent and a counterpart hereof shall
have been executed on behalf of the Collateral Agent, and thereafter shall be
binding upon such Pledgor and the Collateral Agent and their respective
successors and assigns, and shall inure to the benefit of such Pledgor, the
Collateral Agent and the other Secured Parties, and their respective
successors and assigns, except that no Pledgor

                                      12
<PAGE>

shall have the right to assign its rights hereunder or any interest herein or
in the Collateral (and any such attempted assignment shall be void), except as
expressly contemplated by this Agreement or the other Loan Documents. If all
of the capital stock of a Pledgor is sold, transferred or otherwise disposed
of to a Person that is not an Affiliate of the Borrower pursuant to a
transaction permitted by Section 6.06 of the Credit Agreement, such Pledgor
shall be released from its obligations under this Agreement without further
action. This Agreement shall be construed as a separate agreement with respect
to each Pledgor and may be amended, modified, supplemented, waived or released
with respect to any Pledgor without the approval of any other Pledgor and
without affecting the obligations of any other Pledgor hereunder.

            SECTION 18. Survival of Agreement; Severability. (a) All
covenants, agreements, representations and warranties made by each Pledgor
herein and in the certificates or other instruments prepared or delivered in
connection with or pursuant to this Agreement or any other Loan Document shall
be considered to have been relied upon by the Collateral Agent and the other
Secured Parties and shall survive the making by the Lenders of the Loans and
the issuance of the Letters of Credit by the Issuing Bank, regardless of any
investigation made by the Secured Parties or on their behalf, and shall
continue in full force and effect as long as the principal of or any accrued
interest on any Loan or any other fee or amount payable under this Agreement
or any other Loan Document is outstanding and unpaid or the LC Exposure does
not equal zero and as long as the Commitments have not been terminated.

            (b) In the event any one or more of the provisions contained in
this Agreement should be held invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining provisions
contained herein shall not in any way be affected or impaired thereby (it
being understood that the invalidity of a particular provision in a particular
jurisdiction shall not in and of itself affect the validity of such provision
in any other jurisdiction). The parties shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable provisions with
valid provisions the economic effect of which comes as close as possible to
that of the invalid, illegal or unenforceable provisions.

            SECTION 19. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE PROVINCE OF ONTARIO AND THE
FEDERAL LAWS OF CANADA APPLICABLE THEREIN.

            SECTION 20. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall constitute an original, but all of
which, when taken together, shall constitute a single contract, and shall
become effective as provided in Section 17. Delivery of an executed
counterpart of a signature page to this Agreement by facsimile transmission or
other electronic method of transmission shall be effective as delivery of a
manually executed counterpart of this Agreement.

            SECTION 21. Rules of Interpretation. The rules of interpretation
specified in Section 1.03 of the Credit Agreement shall be applicable to this
Agreement. Section headings used herein are for convenience of reference only,
are not part of this Agreement and are not to affect the construction of, or
to be taken into consideration in interpreting, this Agreement.

                                      13
<PAGE>

            SECTION 22. Jurisdiction; Consent to Service of Process. (a) Each
Pledgor hereby irrevocably and unconditionally submits, for itself and its
property, to the exclusive jurisdiction of the Bankruptcy Court and the
Canadian Court, if required, in any action or proceeding arising out of or
relating to this Agreement, or for recognition or enforcement of any judgment,
and each of the parties hereto hereby irrevocably and unconditionally agrees
that, to the extent permitted by applicable law, all claims in respect of any
such action or proceeding may be heard and determined in the Bankruptcy Court
or the Canadian Court, as applicable; provided, however that the Collateral
Agent and the Pledgors acknowledge that any appeals from the Bankruptcy Court
or the Canadian Court, as applicable, may have to be heard by a court other
than the Bankruptcy Court or the Canadian Court, as applicable. Each of the
parties hereto agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law. Nothing in this Agreement
shall affect any right that the Collateral Agent or any other Secured Party
may otherwise have to bring any action or proceeding relating to this
Agreement or the other Loan Documents against any Pledgor or its properties in
the courts of any jurisdiction.

            (b) Each Pledgor hereby irrevocably and unconditionally waives, to
the fullest extent it may legally and effectively do so, any objection that it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement in the Bankruptcy
Court or the Canadian Court, if required. Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such
court.

            (c) Each party to this Agreement irrevocably consents to service
of process in the manner provided for notices in Section 15. Nothing in this
Agreement will affect the right of any party to this Agreement to serve
process in any other manner permitted by law.

            SECTION 23. Waiver Of Jury Trial. EACH PARTY HERETO HEREBY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT
OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT. EACH PARTY HERETO (A)
CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS
AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN
THIS SECTION.

            SECTION 24. Additional Pledgors. Pursuant to Section 5.12 of the
Credit Agreement, each Loan Party organized under the laws of Canada or any
province thereof (a "Canadian Subsidiary") that was not in existence or not a
Loan Party on the date of the Credit Agreement is required to enter in this
Agreement as a Pledgor upon becoming a Loan Party. Upon execution and delivery
by the Collateral Agent and a Canadian Subsidiary of an instrument in the form
of Annex 1, such Canadian Subsidiary shall become a Pledgor hereunder with the
same force and effect as if originally named as a Pledgor herein. The
execution and delivery of

                                      14
<PAGE>

such instrument shall not require the consent of any Pledgor hereunder. The
rights and obligations of each Pledgor hereunder shall remain in full force
and effect notwithstanding the addition of any new Pledgor as a party to this
Agreement.

                 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                      15
<PAGE>

            IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year fist above written.

PLEDGORS:                           UNIPLAST INDUSTRIES CO.

                                    By:___________________________________
                                       Name:
                                       Title:

                                    PLIANT CORPORATION OF CANADA LTD.

                                    By:___________________________________
                                       Name:
                                       Title:

COLLATERAL AGENT:                   GENERAL ELECTRIC CAPITAL CORPORATION

                                    By:___________________________________
                                       Name:
                                       Title:

CANADIAN PLEDGE AGREEMENT

<PAGE>

                                                             Schedule I to the
                                                     Canadian Pledge Agreement

                                   PLEDGORS

Name                                    Address
----                                    -------

Uniplast Industries Co.                 1475 Woodfield Road, Suite 700
                                        Schaumberg, Illinois 60173

<PAGE>

                                                            Schedule II to the
                                                     Canadian Pledge Agreement

                                 CAPITAL STOCK

                   Number of                        Number and        Percentage
Issuer             Certificate   Registered Owner   Class of Shares   of Shares
------             -----------   ----------------   ---------------   ---------

Uniplast US Inc.   R-1           Uniplast           1000 preferred    100% (of
                                 Industries Co.     shares            preferred
                                                                      shares)

                                DEBT SECURITIES

1. The following Intercompany Notes:

--------------------------------------------------------------------------------
                            Intercompany Note                       Date
                            -----------------                       ----

--------------------------------------------------------------------------------
1.      Intercompany Note                                           2/17/04

--------------------------------------------------------------------------------
2.      Intercompany Note issued by Uniplast Holdings, Inc.         5/27/03
        to Uniplast Industries Co.

--------------------------------------------------------------------------------
3.      Intercompany Note issued by Pliant Corporation to           5/27/03
        Uniplast Industries Co.

--------------------------------------------------------------------------------
4.      Intercompany Note issued by Pliant Packaging of             5/27/03
        Canada, LLC to Uniplast Industries Co.

--------------------------------------------------------------------------------
5.      Intercompany Note issued by Pliant Solutions                5/27/03
        Corporation to Uniplast Industries Co.

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

<PAGE>

                                                                Annex 1 to the
                                                     Canadian Pledge Agreement

            SUPPLEMENT NO. ___ dated as of ____________, 20___, to the
CANADIAN PLEDGE AGREEMENT (as amended, restated, supplemented or otherwise
modified from time to time, the "Canadian Pledge Agreement") dated as of
January 4, 2006, among each of the parties listed on the signature pages
thereto and those additional entities that thereafter become parties thereto
(each a "Pledgor" and collectively, the "Pledgors") and GENERAL ELECTRIC
CAPITAL CORPORATION, as collateral agent (in such capacity, the "Collateral
Agent") for the Secured Parties (as defined in the Credit Agreement referred
to below)

            A. Reference is made to (a) the Senior Secured, Super Priority,
Priming Debtor-In-Possession Credit Agreement dated as of January 4, 2006 (as
amended, supplemented or otherwise modified from time to time, the "Credit
Agreement"), among the Parent Borrower, the Domestic Subsidiary Borrowers, the
Lenders party thereto (the "Lenders"), and General Electric Capital
Corporation, as Administrative Agent and Collateral Agent and (b) the
Guarantee Agreement dated as of January 4, 2006 (as amended, supplemented or
otherwise modified from time to time, the "Guarantee Agreement"), among
certain of the Pledgors party thereto and the Administrative Agent.

            B. Capitalized terms used herein and not otherwise defined herein
shall have the meanings assigned to such terms in the Credit Agreement.

            C. The Pledgors have entered into the Canadian Pledge Agreement in
order to induce the Lenders to make Loans and the Issuing Bank to issue
Letters of Credit. Pursuant to Section 5.12 of the Credit Agreement, each Loan
Party organized under the laws of Canada or any province thereof (a "Canadian
Subsidiary") that was not in existence or not a Loan Party on the date of the
Credit Agreement is required to enter into the Canadian Pledge Agreement as a
Pledgor upon becoming a Loan Party. Section 24 of the Canadian Pledge
Agreement provides that such Canadian Subsidiaries may become Pledgors under
the Canadian Pledge Agreement by execution and delivery of an instrument in
the form of this Supplement. The undersigned Canadian Subsidiary (the "New
Pledgor") is executing this Supplement in accordance with the requirements of
the Credit Agreement to become a Pledgor under the Canadian Pledge Agreement
in order to induce the Lenders to make additional Loans and the Issuing Bank
to issue additional Letters of Credit and as consideration for Loans
previously made and Letters of Credit previously issued.

            Accordingly, the Collateral Agent and the New Pledgor agree as
follows:

            SECTION 1.  In accordance with Section 24 of the Canadian Pledge
Agreement, the New Pledgor by its signature below becomes a Pledgor under the
Canadian Pledge Agreement with the same force and effect as if originally
named therein as a Pledgor and the New Pledgor hereby agrees (a) to all the
terms and provisions of the Canadian Pledge Agreement applicable to it as a
Pledgor thereunder and (b) represents and warrants that the representations
and warranties made by it as a Pledgor thereunder are true and correct on and
as of the date

<PAGE>

hereof. In furtherance of the foregoing, the New Pledgor, as security for the
payment and performance in full of the Obligations (as defined in the Canadian
Pledge Agreement), does hereby create and grant to the Collateral Agent, its
successors and assigns, for the benefit of the Secured Parties, their
successors and assigns, a security interest in and lien on all of the New
Pledgor's right, title and interest in and to the Collateral (as defined in
the Canadian Pledge Agreement) of the New Pledgor. Each reference to a
"Pledgor" in the Canadian Pledge Agreement shall be deemed to include the New
Pledgor. The Canadian Pledge Agreement is hereby incorporated herein by
reference.

            SECTION 2.  The New Pledgor represents and warrants to the
Collateral Agent and the other Secured Parties that this Supplement has been
duly authorized, executed and delivered by it and constitutes its legal, valid
and binding obligation, enforceable against it in accordance with its terms.

            SECTION 3.  This Supplement may be executed in counterparts, each
of which shall constitute an original, but all of which when taken together
shall constitute a single contract. This Supplement shall become effective
when the Collateral Agent shall have received counterparts of this Supplement
that, when taken together, bear the signatures of the New Pledgor and the
Collateral Agent. Delivery of an executed signature page to this Supplement by
facsimile transmission or other electronic method of transmission shall be
effective as delivery of a manually signed counterpart of this Supplement.

            SECTION 4.  The New Pledgor hereby represents and warrants that
set forth on Schedule I attached hereto is a true and correct schedule of all
its Pledged Securities.

            SECTION 5.  Except as expressly supplemented hereby, the Canadian
Pledge Agreement shall remain in full force and effect.

            SECTION 6.  THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE PROVINCE OF ONTARIO AND THE FEDERAL LAWS OF
CANADA APPLICABLE THEREIN.

            SECTION 7.  In case any one or more of the provisions contained in
this Supplement should be held invalid, illegal or unenforceable in any
respect, neither party hereto shall be required to comply with such provision
for so long as such provision is held to be invalid, illegal or unenforceable,
but the validity, legality and enforceability of the remaining provisions
contained herein and in the Canadian Pledge Agreement shall not in any way be
affected or impaired. The parties hereto shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable provisions with
valid provisions the economic effect of which comes as close as possible to
that of the invalid, illegal or unenforceable provisions.

            SECTION 8.  All communications and notices hereunder shall be in
writing and given as provided in Section 15 of the Canadian Pledge Agreement.
All communications and notices hereunder to the New Pledgor shall be given to
it at the address set forth under its signature hereto.

<PAGE>

            SECTION 9.  The New Pledgor agrees to reimburse the Collateral
Agent for its reasonable out-of-pocket expenses in connection with this
Supplement, including the reasonable fees, other charges and disbursements of
counsel for the Collateral Agent.

                 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

<PAGE>

            IN WITNESS WHEREOF, the New Pledgor and the Collateral Agent have
duly executed this Supplement to the Canadian Pledge Agreement as of the day
and year first above written.

                                        NEW PLEGDOR:

                                        [NAME OF NEW PLEDGOR]

                                        By:___________________________________
                                           Name:
                                           Title:

                                        COLLATERAL AGENT:

                                        GENERAL ELECTRIC CAPITAL CORPORATION,
                                          AS COLLATERAL AGENT

                                        By:___________________________________
                                           Name: Brian E. Johnson
                                           Title:  Executive Vice-President

CANADIAN PLEDGE AGREEMENT

<PAGE>

                                                                 Schedule I to
                                                              Supplement No.__
                                              to the Canadian Pledge Agreement

                     Pledged Securities of the New Pledgor
                     -------------------------------------

                                 CAPITAL STOCK

Issuer         Number of        Registered      Number and      Percentage
------         Certificate      Owner           Class of        of Shares
               -----------      -----           Shares          ---------
                                                ------

                                DEBT SECURITIES

         Issuer         Principal       Date of         Maturity
         ------         Amount          Note            Date
                        ------          ----            ----Employment Contract Desjourdy 1.3.1006

    AMENDED
      AND RESTATED EMPLOYMENT AGREEMENT

    

    This
      Employment Agreement is made as of the 3rd
      day of
      January, 2006, by and between Symbollon Pharmaceuticals, Inc., a Delaware
      corporation with its principal place of business at 37 Loring Drive, Framingham,
      MA 01702 (the "Company"), and Paul C. Desjourdy, residing at 25 Eastmount Road,
      Medfield, MA 02052 (the "Employee").

    

    In
      consideration of the mutual promises contained in this Agreement, the parties
      agree as follows:

    

    1.
      Titles
      and Responsibilities.
      The
      Company employs the Employee, and the Employee accepts employment, as President,
      Chief Executive Officer, General Counsel and Chief Financial Officer of the
      Company. The Employee shall be directly responsible for management of all
      business operations and setting of overall corporate strategy. Subject to the
      general direction and control of the Board of Directors of the Company (the
      "Board"), the Employee agrees to devote his full time and best efforts to his
      duties and responsibilities for the Company. The Employee shall report directly
      to the Board. 

     

    2.
      Term.
      The
      term of this Agreement shall be deemed to have commenced as of the date hereof
      and, subject to the provisions of Section 12 of this Agreement, shall continue
      in full force and effect until December 31, 2008.

    

    3.
      Base
      Salary.
      During
      the term of this Agreement, the Employee shall be entitled to receive base
      salary at the rate of $265,000 per year, payable not less than monthly in
      arrears, commencing January, 2006. The Company may, but shall not be obligated
      to, increase the Employee's base salary in any year.

    

    4.
      Bonuses.

    

    (a). Annual.
      In
      addition to the base salary described in Section 3, during the term of this
      Agreement, the Employee may be entitled in each calendar year to receive a
      cash
      bonus, stock options and/or such other bonuses, in such amounts and on such
      terms as the Board or the Compensation Committee of the Board (the "Compensation
      Committee") may determine. In the event of the termination of the employment
      of
      the Employee for (i) any reason other than Cause or (ii) by reason of
      Constructive Discharge, the Employee shall be entitled to receive an amount
      equal to the bonus which would otherwise have been payable to the Employee
      under
      any established Company incentive plans, if any, in effect at the time in
      respect of the year during which such termination occurs, pro rated for the
      portion of the year in which such termination occurs.

    

    (b). Signing.
      As an
      incentive to execute this Agreement, the Employee shall be granted as of the
      date hereof options to purchase Class A Common Stock as detailed on Exhibit
      A
      hereto.

    

    
      
        1

      

      
        
        

        
          

        

      

      
        
        

      

    

    5.
      Employee
      Benefits.
      The
      Employee shall have the right to participate in all benefit plans and programs
      generally made available to executives of the Company, including without
      limitation health, dental, life, and disability insurance, vacation programs,
      retirement plans, employee stock plans or benefits and profit sharing
      plans.

    

    6.
      Reimbursement
      of Expenses.
      The
      Company shall reimburse the Employee for all reasonable and necessary expenses
      incurred by him in the performance of his duties hereunder, following his
      appropriate substantiation thereof, in each case in accordance with the
      Company's policies as in effect from time to time.

    

    7.
      Outside
      Consulting.
      With
      prior notification to the Compensation Committee, the Employee may provide
      consulting services to third parties. The Employee may serve as a consultant
      in
      any field which does not directly compete with the Company, including without
      limitation, medical diagnostic products, provided,
      that in
      no event shall such proposed consulting interfere with the operations of the
      Company or the performance of the Employee's duties under this Agreement more
      particularly described in Section 1 hereof. If the Compensation Committee shall
      determine that any consulting activity engaged in by the Employee is not
      permitted hereunder, the Compensation Committee shall provide the Employee
      a
      written statement setting forth the basis for its determination. The Employee
      agrees that in no event will he devote more than two days per month in the
      aggregate in his capacity as a consultant to third parties.

    

    8.
      Severance
      and Other Arrangements.

    

    (a) Generally.
      In the
      event of the termination of the employment of the Employee by the Company
      without Cause, or by the Employee as the result of a Constructive Discharge,
      the
      Company shall:

    

    (i). Continue
      to pay the Employee, in accordance with the Company's normal payroll practices
      and policies in effect from time to time (including any required withholding),
      his base salary at the monthly base salary rate in effect for such Employee
      immediately prior to the termination of his employment) for a period of twelve
      (12) months following the termination of the Employee's employment.

    

    (ii). Provide
      the Employee with health, dental, life and disability insurance substantially
      similar to that which the Employee was receiving immediately prior to the
      termination of his employment until the earlier of: (x) the date which is twelve
      (12) months following the termination of the Employee’s employment; or (y) the
      date the Employment begins receiving substantially similar insurance from a
      subsequent employer. The end of the period during which severance is paid,
      rather than the termination date of employment, will be deemed to be a
      "qualifying event" which would entitle the Employee to acquire at his own
      expense during the minimum election period permitted by the Consolidated Omnibus
      Budget Reconciliation Act (commonly known as "COBRA") or such law as may then
      be
      in effect continuation of coverage under the Company's health and benefit
      plans.

    

    
      
        2

      

      
        
        

        
          

        

      

      
        
        

      

    

    (iii). Provide
      that the Employee shall have three (3) years to exercise any then-exercisable,
      unexpired installments of any stock options held by the Employee on the
      Employee's last date of employment or if later, the date when the Employee
      ceases to be a member of the Board.

    

    (b) Disability.
      In the
      event of any illness (mental or physical) or accident which renders the Employee
      unable to perform his duties and responsibilities, the Company shall, during
      the
      first 3 months of any such illness or after such accident, as the case may
      be,
      continue to pay the Employee's base salary hereunder; and thereafter, during
      any
      such period in excess of 3 months the Company shall supplement any disability
      benefits which the Employee is entitled to receive under the Company's
      disability plans then in effect, for a period of up to 9 additional months,
      in
      an amount such that, together with any amounts the Employee is entitled to
      receive under such plans, the Employee shall receive an aggregate amount equal
      to his base salary during such period.

    

    (c). Change
      of Control.
      Upon a
      Change of Control, all stock options held by the Employee shall vest and become
      immediately exercisable in full.

    

    9.
      Non-competition.
      During
      the term of this Agreement and thereafter the Employee will not directly or
      indirectly, participant in any business that utilizes the Company's proprietary
      information, know-how or trade secrets in any field of activity, including
      specifically those fields that are competitive with the business of the Company,
      nor will the Employee interfere with the contractual relations between the
      Company and any of its employees or partners. The provisions of this Section
      shall not prohibit the ownership of stock in any entity whose stock is publicly
      traded or 5% or less of the outstanding stock of any entity whose stock is
      not
      publicly traded.

    

    10.
      Ownership
      of Developments.
      The
      Employee agrees that any work or research, or the result thereof including
      without limitation, inventions, processes, formula, data, information, programs,
      systems, software or know-how (hereinafter collectively "Proprietary
      Information") made, conceived or developed by Employee, alone or in connection
      with others, prior to or during the term of his employment under this Agreement,
      whether during or out of the usual hours of employment, which are related to
      the
      business, research and development work within the Company's Field of Operation
      are the sole and exclusive property of the Company. The Employee agrees that
      he
      will fully assign the foregoing to Company. The Employee further agrees to
      disclose all Proprietary Information completely and in writing to the Board.
      To
      the extent of the Employee's interest therein, all papers and records of every
      kind, relating to Proprietary Information included within the terms of this
      Agreement, which shall at any time come into the possession of the Employee
      shall be the sole and exclusive property of the Company and shall be surrendered
      to the Company upon termination of the Employee's employment by the Company
      or
      upon the Company's request at any time either during or after the termination
      of
      such employment.

    

    11.
      Confidential
      Information.
      Employee covenants and agrees with the Company that Employee will not during
      or
      after the term of employment disclose to anyone (except to the extent reasonably
      necessary for Employee to perform his duties hereunder) any Proprietary
      Information or other confidential information concerning the business or affairs
      of the Company or of any of its affiliates or subsidiaries or any of their
      customers which Employee may have acquired in the course of or as incident
      to
      Employee's employment or prior dealings with the Company or with any of its
      affiliates, including without limitation, customers lists, or business trade
      secrets of, or methods or techniques used by Employee or any of its affiliates
      in or about their respective business. Nothing contained in this paragraph
      shall
      impair or restrict the right of Employee to use or disclose any information
      already in the public domain.

    

    
      
        3

      

      
        
        

        
          

        

      

      
        
        

      

    

    12.
      Termination.
      Notwithstanding the provisions of Section 2 of this Agreement, the Company
      shall
      have the right to terminate the employment of the Employee for Cause or as
      a
      result of his death or Permanent Disability, and the Employee shall have the
      right to terminate his employment as the result of a Constructive Discharge,
      in
      each case without violation of the terms of this Agreement.

    

    In
      no
      event shall the Company terminate this Agreement without Cause, unless the
      Employee shall have been granted a prior meeting with, and an opportunity to
      be
      heard by, the Board, and a majority of the members of the Board shall have
      determined that the Employee has (i) failed to fulfill his duties to the Company
      in a satisfactory manner or (ii) engaged in conduct detrimental to the
      Company.

    

    13.
      Certain
      Definitions.
      For
      purposes of this Agreement, the following terms shall have the meanings
      indicated:

    

    "Cause"
      means (i) the deliberate dishonesty of the Employee with respect to the Company
      or any subsidiary or affiliate thereof; (ii) conviction of the Employee of
      a felony punishable by imprisonment for more than one year or a fine of $100,000
      or more; or (iii) the willful failure of Employee to perform the material
      lawful duties assigned to him under this Agreement as determined by the Board,
      which failure the Employee shall not have substantially remedied within 30
      days
      after receiving written notice from the Company describing such failure in
      reasonable detail.

    

    "Change
      of Control" means (i) the sale, lease, transfer or other disposition by the
      Company of all or substantially all of its assets in a single transaction or
      a
      series of related transactions; (ii) the merger or consolidation of the Company
      with another entity in which the stockholders of the Company immediately prior
      to such merger or consolidation hold less than 50% of the outstanding voting
      stock of the surviving or resulting corporation immediately following such
      transaction; or (iii) the sale or exchange (to or with any person or entity
      other than the Company) by the stockholders of the Company of more than 50%
      of
      the outstanding voting stock of the Company in a single transaction or series
      of
      related transactions.

    

    
      
        4

      

      
        
        

        
          

        

      

      
        
        

      

    

    "Company's
      Field of Operation" means all therapeutic and/or anti-microbial products,
      including without limitation iodine-based products, and any additional products
      or services developed, marketed, distributed, planned, sold or otherwise
      provided by the Company from time to time prior to or during the term of this
      Agreement.

    

    "Constructive
      Discharge" means the termination of employment by the Employee on the grounds
      that (a)  there has been a decrease in the total annual compensation
      payable by the Company to the Employee, other than as a result of a material
      decrease in compensation payable to the Employee and to all other employees
      of
      similar rank and stature of the Company on the basis of the financial
      performance of the Company, provided,
      however,
      that
      nothing contained herein shall be construed as giving the Company the right
      to
      decrease the Employee's base salary specified in Section 3 hereof, (b) there
      has
      been a Change of Control within the past twelve (12) months, or (c) the
      relocation of the Company's business to a site more than twenty-five (25) miles
      from the Employee's residence.

    

    "Permanent
      Disability" means illness (mental or physical) or accident which renders the
      Employee unable to perform his duties and responsibilities for a period of
      six
      consecutive months or six months in any twelve-month period, and which is
      confirmed to the Board as continuing at the end of such period by expert medical
      opinion. Nothing contained in this Agreement shall affect the right of the
      Employee to receive long-term disability benefits under any long-term disability
      insurance plan(s) of the Company then in effect.

    

    14.
      Miscellaneous.

    

    (a) Notices.
      Any
      notice hereunder shall be effective if delivered personally, by registered
      or
      certified mail, return receipt requested, by overnight or special courier with
      a
      signed receipt, or by facsimile where confirmation of receipt may be verified,
      at the addresses set forth in the preamble to this Agreement or to any other
      properly noticed address given by the parties to each other.

    

    (b) Governing
      Law.
      This
      Agreement shall be construed and governed by the law of the Commonwealth of
      Massachusetts.

    

    (c) Amendments.
      This
      Agreement may not be modified or amended orally. All amendments shall be in
      writing and signed by the Company and Employee.

    

    
      
        5

      

      
        
        

        
          

        

      

      
        
        

      

    

    (d) Assignments.
      This
      Agreement may not be assigned in whole or in part by the Employee. This
      Agreement may be assigned by the Company to any entity acquiring or succeeding
      to control of ownership of the Company or substantially all of the assets of
      the
      Company. This Agreement shall be binding upon and inure to the benefit of the
      parties and to their permitted successors and assigns.

    

    (e) Entire
      Agreement.
      This
      Agreement constitutes the entire understanding of the parties with respect
      to
      its subject matter and supersedes any other agreements between the parties
      with
      respect to such subject matter.

    

    (f) Enforceability.
      If any
      portion or provision of this Agreement shall to any extent be declared illegal
      or unenforceable by a court of competent jurisdiction, then the remainder of
      this Agreement, or the application of such portion or provision in circumstances
      other than those as to which it is so declared illegal or unenforceable, shall
      not be affected thereby, and each portion and provisions of this Agreement
      shall
      be valid and enforceable to the fullest extent permitted by law.

    

    (g) Waiver.
      No
      waiver of any provision hereof shall be effective unless made in writing and
      signed by the waiving party. The failure of any party to require the performance
      of any term or obligation of this Agreement, or the waiver by any party of
      any
      breach of this Agreement, shall not prevent any subsequent enforcement of such
      term or obligation or be deemed a waiver of any subsequent breach.

    

    (h) Arbitration.
      Any
      controversy or claim which arises out of or relating to this Agreement, or
      the
      breach thereof (other than
      controversies or claims with regard to Sections 9, 10 or 11 of this Agreement),
      shall be settled by arbitration in accordance with the Rules of the American
      Arbitration Association then in effect. The controversy or claim shall be
      submitted to three arbitrators, one of whom shall be chosen by the Employee,
      one
      of whom shall be chosen by the Company, and one of whom shall be chosen by
      the
      two so selected. The party desiring arbitration shall give written notice to
      the
      other party of its desire to arbitrate the particular matter in question, naming
      the arbitrator selected by it. If the other party shall fail within a period
      of
      15 days after such notice shall have been given to reply in writing naming
      the
      arbitrator chosen as above provided, or if the two arbitrators selected by
      the
      parties shall fail within 15 days after their selection to agree upon the third
      arbitrator, then either party may apply to the American Arbitration Association
      for the appointment of an arbitrator to fill the place so remaining vacant.
      The
      decision of any two of the arbitrators shall be final and binding upon the
      parties hereto. Judgment upon the award rendered by the arbitrators may be
      entered in any court having jurisdiction thereof.

    

    The
      proceedings shall be held in Boston, Massachusetts. The arbitrators shall have
      no power to award punitive or exemplary damages or to ignore or vary the terms
      of this Agreement, and shall be bound to apply controlling law. Arbitration
      shall be binding and the remedy for the settlement of the controversy or claims
      (except as set forth in the preceding paragraph of this Section).

    

    
      
        6

      

      
        
        

        
          

        

      

      
        
        

      

    

    (i) Certain
      Remedies.
      The
      restrictions contained in Sections 9, 10 and 11 of this Agreement are necessary
      for the protection of the business and goodwill of the Company and are
      considered by the Employee to be reasonable for such purpose. Without limiting
      the remedies available to the Company, the Employee acknowledges that a breach
      of any of the covenants contained in any of such Sections 9, 10 and 11 would
      result in irreparable injury to the Company for which there might be no adequate
      remedy at law, and that, in the event of such a breach or threat thereof, the
      Company shall be entitled to obtain a temporary restraining order and/or such
      other equitable relief as may be required to enforce specifically any of the
      covenants of such Sections 9, 10 and 11. The provisions of such Sections 9,
      10
      and 11 shall survive the termination of this Agreement and shall continue
      thereafter indefinitely in full force and effect in accordance with their
      respective terms. 

    

    IN
      WITNESS WHEREOF, the parties have caused this Agreement to be executed as of
      the
      date and year first above written.

    

    SYMBOLLON
      PHARMACEUTICALS, INC.

    

    

    

    By:
      _/c/ Jack H. Kessler__________________________

    Jack
      H.
      Kessler 

    Chairman
      of the Board

    

    

    Paul
      C. Desjourdy_______________________________

    Paul
      C.
      Desjourdy

    

    
      
        7

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    
      	 	
              Exhibit
                A 

            	 
	 	 	 
	 	
              Option
                Grant 

            	 
	 	 	 
	 	 	 
	
              Number
                of Shares

            	
                                             
                Exercise Price

            	
              Vesting
                Date

            
	 	 	 
	
              200,000

            	
              Fair
                Market Value*

            	
              First
                Anniversary

            
	 	 	 
	
              200,000

            	
              Fair
                Market Value*

            	
              Second
                Anniversary

            
	 	 	 
	
              200,000

            	
              Fair
                Market Value*

            	
              Third
                Anniversary

            
	 	 	 
	
              600,000

            	 	 

    

    

    

    *
      Fair
      Market Value of the Class A Common Stock, as determined under the
      Company=s
      1993
      Employee Stock Option

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