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As filed with the Securities and Exchange Commission on June 16, 2005

Registration No. 333-114608

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

POST-EFFECTIVE AMENDMENT NO. 2
to
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

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

Utah (State or other jurisdiction of incorporation or organization)	2673 (Primary Standard Industrial Classification Code Number)	87-0496065 (I.R.S. Employer Identification No.)
PLIANT CORPORATION INTERNATIONAL (Exact name of registrant as specified in its charter)
Utah (State or other jurisdiction of incorporation or organization)	2673 (Primary Standard Industrial Classification Code Number)	87-0473075 (I.R.S. Employer Identification No.)
PLIANT FILM PRODUCTS OF MEXICO, INC. (Exact name of registrant as specified in its charter)
Utah (State or other jurisdiction of incorporation or organization)	2673 (Primary Standard Industrial Classification Code Number)	87-0500805 (I.R.S. Employer Identification No.)
PLIANT SOLUTIONS CORPORATION (Exact name of registrant as specified in its charter)
Utah (State or other jurisdiction of incorporation or organization)	2673 (Primary Standard Industrial Classification Code Number)	87-0563872 (I.R.S. Employer Identification No.)
PLIANT PACKAGING OF CANADA, LLC (Exact name of registrant as specified in its charter)
Utah (State or other jurisdiction of incorporation or organization)	2673 (Primary Standard Industrial Classification Code Number)	87-0580929 (I.R.S. Employer Identification No.)
UNIPLAST HOLDINGS INC. (Exact name of registrant as specified in its charter)
Delaware (State or other jurisdiction of incorporation or organization)	2673 (Primary Standard Industrial Classification Code Number)	13-3999589 (I.R.S. Employer Identification No.)
UNIPLAST U.S., INC. (Exact name of registrant as specified in its charter)
Delaware (State or other jurisdiction of incorporation or organization)	2673 (Primary Standard Industrial Classification Code Number)	04-3199066 (I.R.S. Employer Identification No.)
UNIPLAST INDUSTRIES CO. (Exact name of registrant as specified in its charter)
Nova Scotia (State or other jurisdiction of incorporation or organization)	2673 (Primary Standard Industrial Classification Code Number)	n/a (I.R.S. Employer Identification No.)

1475 Woodfield Road, Suite 700
Schaumburg, Illinois 60173
(847) 969-3300
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)

Harold C. Bevis
Chief Executive Officer
1475 Woodfield Road, Suite 700
Schaumburg, Illinois 60173
(847) 969-3300
(Name, address, including zip code, and telephone number,
including area code, of agent for service)

With a copy to:
Kevin R. Sweeney
Sonnenschein Nath & Rosenthal LLP
4520 Main Street, Suite 1100
Kansas City, Missouri 64111
(816) 460-2400

Approximate date of commencement of proposed sale to the public: As promptly as practicable after the effective date of this registration statement.

        If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box:    o

        If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

        If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

        If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

The registrants hereby amend this registration statement on such date or dates as may be necessary to delay its effective date until the registrants shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such a date as the Commission, acting pursuant to said Section 8(a), may determine.

EXPLANATORY NOTE

        This Post-Effective Amendment No. 2 is being filed to amend the Registration Statement (Registration No. 333-114608) to provide updated financial and other information.

        In 2004, Pliant Corporation registered an exchange offer for $306,000,000 aggregate principal amount of its 11¹/8% Senior Secured Discount Notes due 2009, which we sometimes refer to as the Senior Secured Discount Notes. On May 6, 2005, Pliant Corporation consummated a consent solicitation as consents to the proposed amendments were delivered with respect to $298,200,000 aggregate principal amount at maturing of the Senior Secured Discount Notes, all of which were accepted by Pliant Corporation. As of May 6, 2005, only $7,800,000 aggregate principal amount at maturity of the Senior Secured Discount Notes registered in 2004 remain outstanding.

        This registration statement covers the registration of the Senior Secured Discount Notes for resale by J.P. Morgan Securities Inc. in market-making transactions.

Prospectus

Pliant Corporation
$7,800,000 Principal Amount at Maturity
11¹/8% Senior Secured Discount Notes due 2009

The Notes are guaranteed on a senior secured basis by our domestic restricted subsidiaries and certain foreign subsidiaries.

        In our 2004 exchange offer we issued $306,000,000 aggregate principal amount at maturity of 11¹/8% Senior Secured Discount Notes due 2009, which have been registered under the Securities Act of 1933, as amended, in exchange for our 11¹/8% Senior Secured Discount Notes due 2009. On May 6, 2005, Pliant Corporation consummated a consent solicitation as consents to the proposed amendments were delivered with respect to $298,200,000 aggregate principal amount at maturing of the Senior Secured Discount Notes, all of which were accepted by Pliant Corporation. As of May 6, 2005, only $7,800,000 aggregate principal amount at maturity of the Senior Secured Discount Notes registered in 2004 remain outstanding.

MATURITY

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The Senior Secured Discount Notes will mature on June 15, 2009.

INTEREST

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The Senior Secured Discount Notes will accrete from the date of issuance at the rate of 11¹/8% until December 15, 2006, compounded semiannually on each June 15 and December 15 commencing June 15, 2004, to an aggregate principal amount of $1,000 per note.



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Commencing on December 15, 2006, interest on the Senior Secured Discount Notes will accrue at the rate of 11¹/8% per annum and will be payable in cash semiannually on each June 15 and December 15, commencing on June 15, 2007.

REDEMPTION

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We may redeem some or all of the Senior Secured Discount Notes at any time on or after June 15, 2007.



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We may also redeem up to 35% of the Senior Secured Discount Notes using the proceeds of certain equity offerings completed before June 15, 2007.



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The redemption prices of the Senior Secured Discount Notes are described on page 95.

CHANGE OF CONTROL

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If we experience a change of control, we must offer to purchase the Senior Secured Discount Notes.

SECURITY AND RANKING

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The Senior Secured Discount Notes and the note guarantees are senior secured indebtedness of the Company and the note guarantors, rank equally in right of payment to all existing and future senior indebtedness of the Company and the note guarantors and rank senior in right of payment to all existing and future subordinated obligations of the Company and the note guarantors.



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The Senior Secured Discount Notes and the note guarantees have the benefit of (i) a first-priority security interest in the First-Priority Collateral, which consists of substantially all the real property, fixtures, equipment, intellectual property and all other assets, other than Second-Priority Collateral, of the Company and the note guarantors and (ii) a second-priority security interest in the Second-Priority Collateral, which consists of substantially all the inventory, receivables, deposit accounts, 100% of the capital stock of, or other equity interests in, existing and future domestic subsidiaries and foreign subsidiaries that are note guarantors, and 65% of the capital stock of, or other equity interests in, existing and future first-tier foreign subsidiaries (other than foreign subsidiaries that are note guarantors), investment property and certain other assets of the Company and the note guarantors, all of which secure on a first-priority basis our obligations and the obligations of the note guarantors under our revolving credit facility.

GUARANTEES

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If we fail to make payments on the Senior Secured Discount Notes, our guarantor subsidiaries must make them instead. Not all of our subsidiaries guarantee the Senior Secured Discount Notes.

        We prepared this prospectus for use by J.P. Morgan Securities Inc. in connection with offers and sales related to market-making transactions in the Notes. J.P. Morgan Securities Inc. may act as principal or agent in these transactions. These sales will be made at prices related to prevailing market prices at the time of sale. We will not receive any of the proceeds of these sales.

        You should carefully consider the risk factors beginning on page 15 of this prospectus before deciding to purchase any Senior Secured Discount Notes.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is accurate or complete. Any representation to the contrary is a criminal offense.

The date of this prospectus is                        , 2005

TABLE OF CONTENTS

	Page
Market and industry data	i
Where you can find more information	ii
Summary	1
Risk factors	15
Disclosure regarding forward-looking Statements	29
Use of proceeds	31
Capitalization	32
Selected financial data	33
Management's discussion and analysis of financial condition and results of operations	36
Business	58
Properties	69
Legal proceedings	70
Market for registrant's common equity and related stockholder matters	71
Management	72
Executive compensation	76
Security ownership of certain beneficial owners and management	81
Certain relationships and related transactions	85
Description of credit facilities and other Indebtedness	89
Description of the 111/8% Senior Secured Discount Notes	95
Book-entry; delivery and form	135
Certain United States federal income tax consequences	137
Plan of distribution	141
Legal matters	141
Experts	141
Index to consolidated financial statements	F-1

MARKET AND INDUSTRY DATA

        Except as otherwise indicated, all industry and market share data reported in this Prospectus is based on estimates made by the Flexible Packaging Association in a "State of the Industry Report 2005," which was compiled based on data compiled from surveys submitted by its members beginning in December of 2004, or from data provided by the Flexible Packaging Association in an investment bank report titled "Paper and Packaging: Industry Overview and Outlook" issued in December 2003. Mr. Bevis serves on the Board of Directors of the Flexible Packaging Association and Pliant is a dues-paying member of the Flexible Packaging Association. Unless otherwise indicated, the market share and industry data used throughout this report were obtained primarily from internal company surveys and management estimates based on these surveys and our management's knowledge of the industry. We have not independently verified any of the data from third-party sources. Similarly, internal company surveys and management estimates, while we believe them to be reliable, have not been verified by any independent sources. While we are not aware of any misstatements regarding our industry data presented herein, our estimates involve risks and uncertainties and are subject to change based on various factors, including those discussed in "Risk Factors" and "Disclosure Regarding Forward-Looking Statements" in this prospectus.

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WHERE YOU CAN FIND MORE INFORMATION

        We file annual, quarterly and current reports and other information with the Securities and Exchange Commission (the "SEC" or the "Commission"). You can inspect and copy these materials at the SEC's Public Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549. Copies of these materials can also be obtained by mail at prescribed rates from the SEC's Public Reference Room at the above address. You can obtain information about the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC also maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. The address of the SEC's Internet site is http://www.sec.gov.

        We maintain an Internet website at http://www.pliantcorp.com. We do not currently make our annual, quarterly and current reports available on or through our website. We do not have publicly traded stock, and copies of our reports are mailed to holders of our outstanding debt securities under the terms of our indentures. In addition, we believe virtually all of our investors and potential investors in our debt securities have access to our reports through the SEC's website or commercial services. Therefore, we do not believe it is necessary to make our reports available through our website. We also provide electronic or paper copies of our filings free of charge upon request.

        We will provide copies to the holders of the Notes of the annual, quarterly and current reports that we file with the SEC. The annual reports will contain financial information that has been examined and reported on, with an opinion expressed, by an independent public accountant.

        We have filed a Registration Statement on Form S-4 relating to offers and sales of the Notes made by J.P. Morgan Securities Inc. in market-making transactions effected from time to time. This prospectus is part of that Registration Statement. As allowed by the Commission's rules, this prospectus does not contain all of the information you can find in the Registration Statement or the exhibits to the Registration Statement. You should note that where we summarize in the prospectus the material terms of any contract, agreement or other document filed as an exhibit to the registration statement, the summary information provided in the prospectus is less complete than the actual contract, agreement or document. You should refer to the exhibits to the registration statement for copies of the actual contract, agreement or document.

        Security holders may request copies of documents referred to in this prospectus by writing or calling us at the following address or phone number:

Pliant Corporation
1475 Woodfield Road, Suite 700
Schaumburg, Illinois 60173
(847) 969-3300
Attention: Corporate Secretary

        You should rely only on the information contained in or incorporated by reference in this prospectus. We have not authorized any other person to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. We are not making an offer to issue the Notes in any jurisdiction where such transaction is not permitted. The information appearing or incorporated by reference in this prospectus is current as of the dates described in this prospectus. Our business, financial condition, results of operation and prospects may have changed since those dates.

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SUMMARY

The following summary highlights certain material information contained elsewhere in this prospectus but does not contain all the information that may be important to you. You should read this entire prospectus and the documents to which we refer you before making an investment decision. You should carefully consider the information set forth under "Risk factors." In addition, certain statements include forward-looking information that involve risks and uncertainties. See "Disclosure regarding forward-looking statements." Unless otherwise indicated, "Pliant," "we," "us" and "the Company" refer to Pliant Corporation and our consolidated subsidiaries.

        References to the Senior Secured Discount Notes, means the 11¹/8% Senior Secured Discount Notes due 2009.

The company

        With 2004 revenues of approximately $968.7 million, we are one of North America's leading manufacturers of value-added films and flexible packaging for food, personal care, medical, agricultural and industrial applications. We offer some of the most diverse product lines in the film industry and have achieved leading positions in many of these product lines. We operate 24 manufacturing and research and development facilities worldwide and currently have approximately 1.0 billion pounds of annual production capacity. For the year ended December 31, 2004 and the three months ended March 31, 2005, we generated net sales of $968.7 million and $262.9 million, respectively, EBITDA from continuing operations (as defined on page 13) of $92.2 million and $21.6 million, respectively, and net losses of $113.9 million and $25.4 million, respectively.

        Our products are sold into numerous markets for a wide variety of end uses and are offered through four operating segments: Specialty Products Group, Industrial Films, Engineered Films, and Performance Films. Operating segments are components of our business 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. In previous reporting periods, we had four operating segments: Pliant U.S., Pliant International, Pliant Flexible Packaging and Pliant Solutions. During the third quarter of 2004, we sold Pliant Solutions and in the fourth quarter of 2004 we reorganized our operations under our four current operating segments: Specialty Products Group, Industrial Films, Engineered Films and Performance Films. Segment information in this Prospectus with respect to 2003 and 2002 has been restated for comparative purposes. For more information on our operating segments and geographic information, see Note 14 to the consolidated financial statements included elsewhere in this prospectus.

Industry overview

        We manufacture and sell a variety of plastic films and flexible packaging products. The plastic film industry serves a variety of flexible packaging markets, including the pharmaceutical, medical, personal care, household, industrial and agricultural film markets, as well as secondary packaging and non-packaging end use markets. According to the Flexible Packaging Association, the North American market for flexible packaging was approximately $21.3 billion in 2004 and has grown at a compound annual growth rate, or CAGR, of approximately 3.9% from 1994-2004. Many of our plastic films are flexible packaging products as defined by the Flexible Packaging Association. However, the flexible packaging market, as defined by the Flexible Packaging Association, does not include certain of the products we sell, such as agricultural films, and includes certain products we do not sell, such as wax papers and aluminum foils. We believe, however, that trends affecting the flexible packaging industry also affect the markets for many of our other products.

        Flexible packaging is used to package a variety of products, particularly food, which accounts for approximately half of all flexible packaging shipments. Recent advancements in film extrusion and resin technology have produced new, sophisticated films that are thinner and stronger and have better barrier and sealant properties than other materials or predecessor films. These technological advances

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have facilitated the replacement of many traditional forms of rigid packaging with film-based, flexible packaging that is lighter, is lower in cost and has enhanced performance characteristics. For example, in consumer applications, stand-up pouches that use plastic films are now often used instead of paperboard boxes, glass jars and metal cans. In industrial markets, stretch and shrink films are often used instead of corrugated boxes and metal strapping to unitize, bundle and protect items during shipping and storage.

Our competitive strengths

        Strong market positions.    We have leading market positions in many of our product lines. We are North America's largest supplier of converter and frozen food films, its second largest supplier of films for the bread and bakery goods market and its third largest supplier of PVC films. We also maintain significant market shares in personal care and stretch films in North America. We attribute our market leadership primarily to our broad and innovative product lines, low-cost manufacturing capabilities, technological capabilities and well-established customer relationships.

        Superior manufacturing capability.    We have modern and efficient manufacturing facilities. Between January 1, 2000 and March 31, 2005, excluding acquisitions, we invested a total of $221.3 million to expand, upgrade and maintain our asset base and information systems. With 24 plants, we are often able to allocate lines to specific products, resulting in fewer change-overs and more efficient use of production capacity. Our combination of manufacturing flexibility and efficiency enhances our ability to bring new technologies to the marketplace and meet the ever-increasing performance needs of our customers in a cost-effective manner.

        Low-cost production.    We believe that our manufacturing costs are among the lowest in the industry because of: (a) economies of scale provided by our high volume production; (b) high plant utilization; (c) highly competitive pricing for resin and other raw materials, based on our significant purchasing requirements; (d) modern manufacturing equipment that minimizes resin requirements and waste; and (e) capital investment that has improved our technical capabilities and operating efficiencies.

        Industry leading technology and product development capabilities.    Our research and development group provides the latest resin and extrusion technology to our manufacturing facilities and allows us to test new resins and process technologies. Our technical center in Newport News, VA has a pilot plant that allows the technical center to run commercial "scale-ups" for new products. We are able to use our broad product offerings and technology to transfer technological innovations from one market to another.

        Well-established customer relationships.    Our films are components of flexible packaging for some of the largest food companies in the world, including household names such as General Mills, Interstate Bakeries (Wonder Bread), Kraft/Nabisco, Kroger, and Safeway. Our customers also include many of North America's largest flexible packaging converters, such as AICan Packaging (which recently acquired customers Lawson Mardon and Pechiney), Printpack and Sonoco, and the largest national distributors of industrial films, Bunzl, Unisource, and Xpedx. In addition, we manufacture and supply film to some of the largest non-food film consumers in North America, including 3M, Baxter, Becton-Dickinson, Goodyear, Johnson & Johnson, Kimberly-Clark and Tyco/Kendall Healthcare.

        Proven and committed management team.    We have assembled an outstanding management team at both our corporate and operating levels. At the corporate level, our senior management has extensive and varied experience in identifying, acquiring and integrating strategic businesses and in allocating capital, developing corporate strategy and bringing financial discipline to such businesses. At the operating level, our Executive and Senior Vice Presidents have an average of more than 20 years of industrial experience.

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Our business strategy

        We seek to expand our leadership position in high margin value-added films and flexible packaging products through a continued focus on developing new products and new markets, and leveraging our long-standing customer relationships. We seek to achieve these objectives by pursuing the following strategies:

        Continue to focus business resources on value-added films.    We are focused on differentiating our products and deploying corporate resources to develop value-added films that deliver superior technology to our customers. We have brought innovative technological advances to the marketplace, which has enabled us to provide high value to our customers. Through our portfolio of value-added products such as multilayer-engineered films (5 and 7 layer films), advanced coating technology to replace laminations (E-beam coating), water quench technology and proprietary stretch film products, we believe we are able to strategically meet the specific needs of our customers in a cost effective manner.

        Accelerate top-line growth opportunities.    By leveraging our product breadth to existing and new customers, we seek to expand our market share and identify new opportunities for growth. We have identified significant opportunities to increase our sales by cross-selling our products in an effort to provide solutions that add value to our customers. We believe our broad product line allows us to capitalize on our relationships with large accounts which we believe are seeking to consolidate their vendor relationships.

        Pursue new, large customer accounts.    We intend to strengthen customer relationships with our large accounts in order to drive growth. Our experienced sales force and advanced technology allow us to provide client-focused solutions for our top-tier accounts. Benefiting from our size and breadth, we feel that our unique platform and value-added product mix will be a significant growth driver.

        Continue to optimize utilization of asset base.    We intend to fully optimize the utilization of our modern and efficient asset base. Between January 1, 2000 and March 31, 2005, excluding acquisitions, we invested a total of $221.3 million to expand, upgrade and maintain our asset base and information systems. We look to continue leveraging these assets going forward. Our combination of manufacturing flexibility and efficiency enables us to meet the ever-increasing performance needs of our customers in a cost efficient manner.

        Continue to rationalize cost structure through continuous process improvement.    We are committed to reducing costs by focusing on operational improvements and leveraging economies of scale. We have identified three key areas for cost improvement: sourcing lower cost raw materials; improving transportation and warehouse logistics; and reducing waste and scrap.

History

        We were founded in 1992. We have combined strategic acquisitions, internal growth, product innovation and operational improvements to grow our business from net sales of $310.8 million in 1996 to $968.7 million in 2004.

        On May 31, 2000, we consummated a recapitalization pursuant to an agreement dated March 31, 2000 among us, our then existing stockholders and Southwest Industrial Films, LLC, an affiliate of J.P. Morgan Partners, LLC, whereby Southwest Industrial Films acquired majority control of our common stock. The total consideration paid in the recapitalization was approximately $1.1 billion, including transaction costs.

        As a result of the recapitalization and subsequent investments, J.P. Morgan Partners (BHCA), L.P. and its affiliates own approximately 55% of our outstanding common stock, 74% of our detachable warrants to purchase common stock issued in connection with our preferred stock, and 59% of our

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outstanding preferred stock. J.P. Morgan Partners (BHCA), L.P. and its affiliates have invested a total of approximately $238 million in our common and preferred stock (including warrants).

Recent developments

Senior management changes

        In October 2003, Harold C. Bevis was appointed as our President and Chief Executive Officer and was elected to our Board of Directors. Edward A. Lapekas, who had served as our interim Chief Executive Officer since the August 24, 2003 termination of Jack E. Knott II, was named the Non-Executive Chairman of our Board of Directors. We entered into a consulting agreement with Mr. Lapekas in 2003. In November 2003, R. David Corey was named our Executive Vice President of Global Operations and was promoted to Executive Vice President and Chief Operating Officer in March 2004. Brian Johnson, who served as Chief Financial Officer of the Company beginning in July 2001, resigned as Executive Vice President and Chief Financial Officer of the Company in May 2004, although he continued to be employed as a non-executive officer of the Company until December 31, 2004. In September 2004, James Ide was hired as the Chief Financial Officer of the Company, a position from which he resigned effective January 26, 2005. Since that time, Mr. Bevis has served as the acting Chief Financial Officer of the Company. In May 2004, Lori Roberts was hired as Senior Vice President, Human Resources, a position from which she resigned effective March 18, 2005. Since that time, Mr. Corey has served as the acting director of Human Resources of the Company. Mr. Bevis has established a flatter and simpler organization for Pliant going forward by eliminating several layers of management which will not be replaced. Mr. Bevis has also installed the Pliant Leadership Team which will consist of a broad group of leaders from throughout the organization. This team meets on a monthly basis to review and discuss our business so that the management can make better informed and quicker decisions.

11⁵/8% Senior Secured Notes Due 2009 (the "Amended 2004 Notes")

        On April 8, 2005, Pliant Corporation commenced a consent solicitation relating to its Senior Secured Discount Notes seeking consents, among other things, to (i) eliminate the current requirement to pay cash interest on the notes beginning in 2007 and, in lieu thereof, pay non-cash interest in the form of additional notes through maturity and (ii) increase the interest rate and redemption prices of the notes for which consents are received. On May 6, 2005, Pliant consummated this solicitation as consents to the proposed amendments were delivered with respect to $298.2 million aggregate principal amount at maturity of the notes, all of which were accepted by Pliant.

        As of May 6, 2005, the aggregate principal amount of the Amended 2004 Notes was approximately $250.6 million and equaled their accreted value immediately prior to such consummation. In addition, $7.8 million aggregate principal amount at maturity of Senior Secured Discount with respect to which consents were not delivered remain outstanding. Pliant, certain of its subsidiaries and the trustee also executed an amended and restated indenture governing the Amended 2004 Notes and the Senior Secured Discount Notes with respect to which consents were not delivered. Pliant, certain of its subsidiaries and J.P. Morgan Securities Inc., the solicitation agent for the consent solicitation, executed a registration rights agreement with respect to the Amended 2004 Notes.

        As a result of the amendments approved in the consent solicitation, the interest rate of the Amended 2004 Notes was increased from 11¹/8% per annum to 11⁵/8% per annum. The Amended 2004 Notes no longer require payment of cash interest beginning in 2007. Instead, they require payment of non-cash interest in the form of additional notes through maturity. The amendments also increased the redemption prices of the amended notes. In addition, the amended and restated indenture eliminates substantially all the restrictive covenants contained in the indenture, as they relate to holders of the Senior Secured Discount Notes with respect to which consents were not delivered. The transaction in which the terms of the Senior Secured Discount Notes were amended to become the Amended 2004 Notes was not registered under the Securities Act of 1933, as amended, or any state securities laws and

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the Amended 2004 Notes may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and any applicable state securities laws. Pursuant to a registration rights agreement Pliant agreed to consummate an exchange offer for the Amended 2004 Notes in which the company will issue up to $298,200,000 aggregate principal amount at maturity of 11⁵/8% Senior Secured Notes due 2009 which will be registered under the Securities Act of 1933, as amended, in exchange for the existing Amended 2004 Notes.

Sale of Senior Secured Discount Notes

        On February 17, 2004, we completed the sale of $306,000,000 in aggregate principal amount at maturity of 11¹/8% Senior Secured Discount Notes due 2009. The net proceeds from such sale in the amount of $220.2 million (after deducting underwriters' fees) together with borrowings of $30.0 million under our revolving credit facility described below, were used to pay off our then existing term loan facilities in the amount of $219.6 million and our then existing revolving credit facility in the amount of $20 million and $3.8 million in fees and other costs, leaving $6.8 million of cash on hand. The Senior Secured Discount Notes are secured by a first-priority security interest in the First-Priority Collateral, consisting of substantially all of the real property, fixtures, equipment, intellectual property and all other assets, other than the Second-Priority Collateral described below, of us and those of our subsidiaries that guarantee the notes, and a second-priority security interest in the Second-Priority Collateral, consisting of substantially all of the inventory, receivables, deposit accounts, 100% of the capital stock of, or other equity interests in, existing and future domestic subsidiaries and foreign subsidiaries that are note guarantors, and 65% of the capital stock of, or other equity interests in, existing and future first-tier foreign subsidiaries (other than foreign subsidiaries that are note guarantors), investment property and certain other assets of the Company and the note guarantors.

Revolving credit facility

        On February 17, 2004, we terminated our then existing credit facilities and entered into a revolving credit facility in the principal amount of up to $100 million. See "Description of credit facilities and other indebtedness—Revolving credit facility." The revolving credit facility is secured on a first-priority basis by the Second-Priority Collateral and is secured on a second-priority basis by the First-Priority Collateral. All of the term debt and revolver under the credit facilities that existed at December 31, 2003 had been at variable rates of interest, so payment of the term loans with the proceeds of our Senior Secured Discount Notes and borrowings under our revolving credit facility substantially reduced our exposure to interest rate risk. Although our $100 million revolving credit facility is at a variable rate of interest, there are substantially fewer financial covenants than our credit facilities that existed at December 31, 2003, which substantially reduces our exposure to covenant default risk. While the effective interest rate on the Senior Secured Discount Notes and the Amended 2004 Notes is higher than the term loans retired from the proceeds of the February 2004 offering, we will realize greater short-term liquidity and flexibility in our debt structure resulting from the elimination of a number of the financial and other covenants in our then existing credit facilities and the deferral of cash interest requirements during the period in which the Senior Secured Discount Notes and the Amended 2004 Notes accrete.

11¹/8% Senior Secured Notes due 2009 (the "2003 Notes")

        In 2003, Pliant Corporation registered an exchange offer for $250,000,000 aggregate principal amount of its 11¹/8% Senior Secured Notes due 2009, which we sometimes refer to as the 2003 Notes.

        The 2003 Notes are senior secured obligations, rank equally in right of payment to all existing and future senior indebtedness, are secured on a second-priority basis by substantially all of our assets and the assets of our note guarantors, are structurally subordinated to our revolving credit facility, our Senior Secured Discount Notes and our Amended 2004 Notes to the extent of the value of the

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collateral securing our revolving credit facility and those notes on a first-priority basis, and rank senior in right of payment with all existing and future subordinated obligations.

13% Senior Secured Notes due 2010 (the "2000/2002 Notes")

        In 2000, Pliant Corporation registered an exchange offer for $220,000,000 aggregate principal amount of its 13% Senior Subordinated Notes due 2010 and in 2002, Pliant Corporation registered an exchange offer for an additional $100,000,000 aggregate principal amount of its 13% Senior Subordinated Notes due 2010. We sometimes refer to the $320,000,000 aggregate principal amount of 13% Senior Subordinated Notes due 2010 as the 2000/2002 Notes. The 2000/2002 Notes are unsecured and subordinated to all of our existing and future senior debt, rank equally with all of our future senior subordinated debt and rank senior to all of our future subordinated debt.

Sale of Pliant Solutions and Reorganization of Company Operations

        On September 30, 2004, we sold substantially all of the assets of our wholly-owned subsidiary, Pliant Solutions Corporation for a total consideration of $9 million. We acquired Pliant Solutions Corporation from Décora in 2002. Pliant Solutions Corporation, previously reported as a separate operating segment during the first three quarters of the 2004 fiscal year, manufactured decorative and surface coverings through the conversion of various films into consumer packaged goods. The Pliant Solutions operating segment had net sales for the nine months ended September 30, 2004 of $22.5 million; net sales for the twelve months ended December 31, 2003 of $34.9 million; and net sales for the eight months ended December 31, 2002 of $28.3 million. As a result of our sale of Pliant Solutions Corporation, during the fourth quarter of 2004, we reorganized our operations under four operating segments: Specialty Products Group, Industrial Films, Engineered Films and Performance Films.

Adoption of 2004 Incentive Plans and Issuance of Series B Preferred Stock

        Effective January 1, 2004, our Board of Directors adopted two new benefit plans in which some or all of our named executive officers may participate: the 2004 Management Incentive Compensation Plan and the 2004 MIP Long Term Incentive Plan. The participants in the 2004 Management Incentive Compensation Plan were paid cash bonuses relating to achievement of certain EBITDA and operating free cash flow goals for 2004. In addition, participants in the 2004 MIP Long Term Incentive Plan, which includes all officers and other key management personnel of the Company (except the Chief Executive Officer), received a credit of half of the 2004 bonus amount to the accumulated amount of their Long Term Incentive Plan Award that they can earn under the 2004 MIP Long Term Incentive Plan, which will become payable on December 31, 2007 under the terms of that plan to eligible employees who are then employed by the Company and who have satisfied certain other conditions as set forth in the plan. (See "Executive Compensation")

        In August 2004, our Board of Directors adopted the 2004 Restricted Stock Incentive Plan. Since the adoption of the 2004 Restricted Stock Incentive Plan, we sold 720 shares of a newly created Series B Preferred Stock to our Chief Executive Officer and certain other officers in a private transaction at $162 per share, which was determined to be the fair market value of those shares based on an independent appraisal received by the Board. On February 14, 2005, 48 shares of non-voting Series B Redeemable Preferred Stock were repurchased from an officer for $162 per share.

Termination of Alliant Joint Venture

        On January 5, 2005, we terminated our joint venture with Supreme Plastics Group PLC by purchasing all of the equity interests in the joint venture Supreme Plastics Group PLC owned for $400,000. As of January 5, 2005, Alliant Company LLC became a wholly-owned subsidiary of the Company. On April 13, 2005, Pliant Corporation sold the intellectual property, working capital, and equipment assets used in the Alliant operation to an independent third party for a purchase price of $6.3 million, subject to certain adjustments with $4.6 million paid in cash at closing, $0.6 million paid 10 days after closing and $0.5 million to be paid within 70 days of closing. The remaining purchase price of $0.63 million will be paid in equal installments twelve and twenty-four months after closing. Net sales and net loss for the three months ended March 31, 2005 were $0.6 million and $0.3 million, respectively.

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Summary of the terms of the Senior Secured Discount Notes

        The following summary contains basic information about the Senior Secured Discount Notes and is not intended to be complete. For a more complete understanding of the Senior Secured Discount Notes, please refer to the section entitled "Description of Senior Secured Discount Notes" in this prospectus.

Issuer	Pliant Corporation.
Notes	$7,800,000 aggregate principal amount at maturity of 111/8% Senior Secured Discount Notes due 2009.
Maturity	June 15, 2009.
Yield and interest	Unless we elect to pay cash interest as described below, and except under certain limited circumstances (see "Description of Senior Secured Discount Notes—Principal, maturity and interest") the Senior Secured Discount Notes will accrete from the date of issuance at the rate of 111/8% until December 15, 2006, compounded semiannually on each June 15 and December 15 commencing June 15, 2004, to an aggregate principal amount of $1,000 per note ($7.8 million in the aggregate assuming no redemption or other repayments). Commencing on December 15, 2006, interest on the Senior Secured Discount Notes will accrue at the rate of 11 1/8% per annum and will be payable in cash semiannually on June 15 and December 15, commencing on June 15, 2007 to holders of record on the immediately preceding June 1 and December 1, respectively.
	On any interest payment date prior to December 15, 2006, we may elect to commence paying cash interest (from and after such interest payment date) in which case (i) we will be obligated to pay cash interest on each subsequent interest payment date, (ii) the Senior Secured Discount Notes will cease to accrete after such interest payment date and (iii) the outstanding principal amount at the stated maturity of each note will equal the accreted value of such note as of such interest payment date. See "Description of Senior Secured Discount Notes—Principal, maturity and interest."
Original issue discount	The Senior Secured Discount Notes were issued at a discount from their stated principal for U.S. federal income tax purposes. Consequently, original issue discount will be included in the gross income of a U.S. holder of Senior Secured Discount Notes for U.S. federal income tax purposes in advance of the receipt of cash payments on the Senior Secured Discount Notes. For more information, see "Certain United States federal income tax consequences."
Optional redemption	On or after June 15, 2007, we may redeem some or all of the Senior Secured Discount Notes at the redemption prices listed in the section entitled "Description of Senior Secured Discount Notes — Optional redemption." Prior to such date, we may not redeem the Senior Secured Discount Notes except

7

	as described in the following paragraph. At any time prior to June 15, 2007, we may redeem up to 35% of the accreted value of the Senior Secured Discount Notes with the net cash proceeds of certain equity offerings by us at a redemption price equal to 111.125% of the accreted value thereof plus accrued interest, so long as (i) at least 65% of the accreted value of the Senior Secured Discount Notes remains outstanding after such redemption and (ii) any such redemption by us is made within 120 days after such equity offering.
Guarantees	The Senior Secured Discount Notes are fully and unconditionally guaranteed by each of our existing and future domestic restricted subsidiaries and, to the extent they also guarantee any debt of the Company or our domestic subsidiaries, by each of our existing and future foreign restricted subsidiaries. If we fail to make payments on the Senior Secured Discount Notes, our subsidiaries that are note guarantors must make them instead.
Collateral	Our obligations under the Senior Secured Discount Notes and the obligations of the note guarantors under the note guarantees are secured by a first-priority security interest in the First-Priority Collateral. The First-Priority Collateral consists of substantially all the real property, fixtures, equipment, intellectual property and all other assets, other than Second-Priority Collateral, of the Company and the note guarantors, together with the proceeds therefrom and improvements, alterations and repairs thereto, as well as any assets required to be added to the First-Priority Collateral pursuant to the terms of the indenture or related agreements.
	In addition, our obligations under the Senior Secured Discount Notes and the obligations of the note guarantors are secured by a second-priority security interest in the Second-Priority Collateral. The Second-Priority Collateral consists of substantially all the inventory, receivables, deposit accounts, 100% of the capital stock of, or other equity interests in, existing and future domestic subsidiaries and foreign subsidiaries that are note guarantors, and 65% of the capital stock of, or other equity interests in, existing and future first-tier foreign subsidiaries (other than foreign subsidiaries that are note guarantors), investment property and certain other assets of the Company and the note guarantors. The Second-Priority Collateral is comprised of substantially all of the material collateral (other than the First-Priority Collateral) that secure on a first-priority basis our obligations and the obligations of the note guarantors under our revolving credit facility.
	The security interests in our assets held by the holders of our 111/8% Senior Secured Notes due 2009 (the "2003 Notes") are subordinated and rank junior in priority to the security

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	interests of the Senior Secured Discount Notes on the First-Priority Collateral and pari passu with the security interests of the Senior Secured Discount Notes on the Second-Priority Collateral. The security interests in our assets held by the holders of our 115/8% Senior Secured Notes due 2009 (the "Amended 2004 Notes") rank pari passu with the security interests of the Senior Secured Discount Notes on the First-Priority Collateral and the Second-Priority Collateral. See "Description of Senior Secured Discount Notes—Security."
Intercreditor agreement	The trustee of the Senior Secured Discount Notes, the Amended 2004 Notes, the agent representing the lenders under our revolving credit facility and the agent representing the holders of our 2003 Notes have entered into an intercreditor agreement. Pursuant to the terms of the intercreditor agreement, the trustee of the Senior Secured Discount Notes will determine the time and method by which the security interests in the First-Priority Collateral will be enforced and the agent representing the lenders under our revolving credit facility will determine the time and method by which the security interests in the Second-Priority Collateral will be enforced. The trustee will not be permitted to enforce the security interests in the Second-Priority Collateral even if an event of default has occurred and the Senior Secured Discount Notes have been accelerated except in certain specified circumstances. The agent representing the lenders under our revolving credit facility and the agent representing the holders of our 2003 Notes will be subject to similar restrictions with respect to their ability to enforce their respective second-priority security interests in the First-Priority Collateral. See "Description of Senior Secured Discount Notes—Intercreditor agreement."
Ranking	The Senior Secured Discount Notes:
	•	rank pari passu with our Amended 2004 Notes in all respects;
	•	are senior secured obligations of the Company;
	•	effectively rank senior to our unsecured indebtedness and indebtedness secured by junior liens, including borrowings under our revolving credit facility and our 2003 Notes, to the extent of the value of the First-Priority Collateral;
	•	effectively rank junior to any indebtedness secured by first-priority security interests, including borrowings under our revolving credit facility, on the Second-Priority Collateral to the extent of the value of such Second-Priority Collateral;
	•	effectively rank pari passu with any indebtedness secured by second-priority security interests, including our 2003 Notes, on the Second-Priority Collateral to the extent of the value of such Second-Priority Collateral;

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•	effectively rank senior to our unsecured indebtedness to the extent of the residual value of the Second-Priority Collateral;
•	rank equally in right of payment to all existing and any future senior indebtedness of the Company;
•	are senior in right of payment with all existing and any future subordinated obligations of the Company; and
•	are effectively subordinated to all liabilities (including trade payables) and preferred stock of each subsidiary of the Company that is not a note guarantor, which non-guarantor subsidiaries generated 12.9% of our net sales in 2004.
Similarly, the note guarantees:
•	are senior secured obligations of each note guarantor;
•	rank pari passu with each note guarantor's guarantee of the Amended 2004 Notes;
•	effectively rank senior to the unsecured indebtedness of the note guarantors and indebtedness of the note guarantors secured by junior liens to the extent of the value of the First-Priority Collateral held by the note guarantors;
•	effectively rank junior to any indebtedness of the note guarantors secured by first-priority security interests on the Second-Priority Collateral held by the note guarantors to the extent of the value of such Second-Priority Collateral;
•	effectively rank pari passu with any indebtedness of the note guarantors secured by second-priority security interests on the Second-Priority Collateral held by the note guarantors to the extent of the value of such Second-Priority Collateral;
•	effectively rank senior to any unsecured indebtedness of the note guarantors to the extent of the residual value of the Second-Priority Collateral held by the note guarantors;
•	rank equally in right of payment to all existing and any future senior indebtedness of the note guarantors; and
•	are senior in right of payment with all existing and any future subordinated obligations of the note guarantors.
As of March 31, 2005:
•	we had $552.3 million of senior debt including (i) $41.4 million of borrowings under our revolving credit facility (excluding $6.7 million of letters of credit outstanding) secured by a first-priority security interest in the Second-Priority Collateral and a second-priority security interest in the First-Priority Collateral, (ii) $250.0 million of 2003 Notes secured by a second-priority security interest in the First-Priority Collateral and the Second-Priority Collateral, (iii) $6.5 million of Senior Secured Discount

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	Notes secured by a first-priority security interest in the First-Priority Collateral and a second-priority security interest in the Second-Priority Collateral (iv) $248.0 million of 115/8% Senior Secured Notes due 2009 (the "Amended 2004 Notes") secured by a first-priority interest in the First-Priority Collateral and a second-priority security interest in the Second-Priority Collateral, and (v) $6.4 million of other senior secured debt.
	•	we had $313.4 million principal amount of subordinated debt, consisting of our 13% Senior Subordinated Notes due 2010 (the "2000/2002 Notes"); and
	•	our subsidiaries that are not guarantors of the Senior Secured Discount Notes would have had $21.1 million of liabilities, including trade payables, excluding liabilities owed to us.
	Subject to certain conditions, the indenture relating to the Senior Secured Discount Notes permits us to incur additional debt, including debt that may be secured by first-priority and second-priority liens on the collateral securing the Senior Secured Discount Notes. In addition to the $48.1 million of senior debt outstanding as of March 31, 2005 under our revolving credit facility, the indenture permits us to incur approximately $49.7 million of additional senior debt under that revolving credit facility.
Certain covenants	Effective May 6, 2005, the indenture related to our Senior Secured Discount Notes was amended to eliminate certain restrictive covenants that previously applied to the Senior Secured Discount Notes. The indenture governing the Senior Secured Discount Notes contains covenants that limit our ability and the ability of certain of our subsidiaries to, among other things:
	•	incur liens; and
	•	merge or consolidate.
	These covenants are subject to a number of important exceptions. For more details, see "Description of Senior Secured Discount Notes—Certain covenants."

Risk factors

        Investing in the Senior Secured Discount Notes involves substantial risk. You should carefully consider all the information contained in this prospectus and, in particular, should consider carefully the factors set forth under the caption "Risk factors" before making an investment in the Senior Secured Discount Notes.

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Summary financial data

        The following table sets forth summary financial data for the fiscal years ended December 31, 2002, 2003 and 2004 and the three months ended March 31, 2004 and 2005. The summary financial data for the years ended December 31, 2002, 2003 and 2004 have been summarized from our audited consolidated financial statements and are qualified in their entirety by reference to our audited consolidated financial statements. The summary financial data for the three months ended March 31, 2005 and 2004 have been derived from unaudited consolidated financial statements, which, in the opinion of management, reflect all adjustments (consisting only of normal and recurring adjustments) necessary for a fair presentation of the results for those periods. Results of operations for the interim period are not necessarily indicative of the results to be expected for the full fiscal year and any future period. You should read the following summary financial data together with "Capitalization," "Selected financial data," "Management's discussion and analysis of financial condition and results of operations" and our consolidated financial statements and the notes thereto included elsewhere in this prospectus.

		Years ended December 31,									Three months ended March 31, (unaudited)
(Dollars in millions)		2002			2003			2004			2004			2005
Statement of operations data:(1)
	Net sales	$	850.9		$	894.5		$	968.7		$	236.8		$	262.9
	Cost of sales		693.7			758.2			826.8			198.5			228.9
	Gross profit		157.2			136.3			141.9			38.3			34.0
	Total operating expenses(2)		126.2			128.1			90.0			21.7			22.3
	Operating income (loss)		31.0			8.2			51.9			16.6			11.7
	Interest expense(3)(4)		(75.3	)		(96.4	)		(145.7	)		(43.0	)		(35.7	)
	Other income (expense), net		2.3			0.5			(0.7	)		(0.1	)		(0.2	)
	Loss from continuing operations before income taxes		(42.0	)		(87.8	)		(94.6	)		(26.5	)		(24.2	)
	Income tax expense (benefit)		(1.5	)		5.2			1.6			1.7			0.9
	Loss from continuing operations		(40.5	)		(93.0	)		(96.2	)		(28.2	)		(25.1	)
	Loss from discontinued operations		(2.9	)		(21.3	)		(17.7	)		(2.6	)		(0.3	)
	Net Loss	$	(43.4	)	$	(114.3	)	$	(113.9	)	$	(30.8	)	$	(25.4	)
Other financial data:
	EBITDA from continuing operations(5)	$	79.0		$	55.5		$	92.2			27.5			21.6
	Net cash provided by (used in) operating activities		52.4			(14.2	)		(1.4	)		0.4			(7.4	)
	Net cash used in investing activities		(55.2	)		(17.0	)		(17.6	)		(3.0	)		(8.6	)
	Net cash provided by (used in) financing activities		12.4			46.0			25.5			4.9			16.2
	Depreciation and amortization		45.7			46.9			41.1			11.0			10.1
	Impairment of goodwill and intangible assets(2)		8.6			18.3			—			—			—
	Impairment of fixed assets(2)		—			4.8			0.4			—			—
	Restructuring and other costs(2)		30.1			12.6			2.1			—			0.1
	Capital expenditures		49.2			17.0			24.1			3.0			9.0
	Ratio of earnings to fixed charges(6)		—			—			—			—			—
(Dollars in millions)
Balance sheet data as of March 31, 2005 (unaudited):
Cash and cash equivalents														$	4.1
Working capital															88.8
Total assets															786.0
Total debt															865.8
Shares subject to mandatory redemption(7)															239.2
Total liabilities															1,328.2
Redeemable preferred stock(8)															0.1
Redeemable common stock															6.6
Stockholders' equity (deficit)															(549.0	)

(1)

On September 30, 2004, we sold substantially all of the assets of Pliant Solutions Corporation which was previously reported as one of our operating segments. In accordance with SFAS No. 144, Accounting for

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the Impairment of Long-Lived Assets, Pliant Solutions is being accounted for as a discontinued operation and, accordingly, its assets are segregated from continuing operations, and its operating results are segmented and reported as discontinued operations in all periods presented. Net sales for the three months ended March 31, 2004 were $7.4 million. Net sales for the nine months ended December 31, 2004 and the twelve months ended December 31, 2003 were $22.5 million and $34.9 million, respectively. Net sales for the eight months ended December 31, 2002 were $28.3 million. No tax benefits were recorded on the losses from discontinued operations or the loss on sale of discontinued operations as realization of these tax benefits is not certain.

(2)

Total operating expenses include restructuring and other costs of $0.1 million for the three months ended March 31, 2005 for severance and other costs associated with closure of our Harrisville, RI facility. Total operating expenses include restructuring and other costs of $2.1 million for the year ended December 31, 2004 for fixed asset impairment charges of $1.4 million and restructuring and other costs of $0.7 million related to closure of our Harrisville, RI facility. For the year ended December 31, 2003, restructuring and other costs of $12.6 million were included which consisted of $2.0 million for fixed asset impairment charges related to the closure of our facility in Shelbyville, IN, $0.7 million related to the closure of our facility in Brazil consisting primarily of fixed asset impairment charges, $2.6 million related to the closure and transfer of the production from our facility in Fort Edward, NY to our facilities in Mexico and Danville, KY, $1.4 million related to the consolidation of two plants in Mexico, $2.6 million related to the closure and transfer of production from our Merced, CA facility, and other costs related to the closure of our Shelbyville, IN facility, our Singapore office and a section of our Toronto facility. In addition, during 2003 we accrued the present value of future lease payments on three buildings we do not currently occupy in an amount equal to $3.3 million and a provision for litigation of $7.2 million.

Total operating expenses for the year ended December 31, 2003 also included $18.3 million for the impairment of goodwill and intangibles, consisting of $10 million in our Engineered Films segment for Canada, $7.3 million in our Specialty Products Group segment for Mexico and $1.0 million in our Industrial segment for Germany and Australia, and $4.8 million for impairment of fixed assets, $2.4 million in our Performance Films segment and $1.2 million in both our Specialty Products Group and Industrial Films segment.

Total operating expenses for 2002 include $30.1 million of restructuring and other costs, including $14.8 million related to the closure of our plant in Merced, CA, a portion of our plant in Shelbyville, IN, a part of our plant in Toronto, Canada, and one of our plants in Mexico. In addition, these costs reflect $7.9 million for the costs of relocating several of our production lines related to plant closures and costs associated with production rationalizations at several plants. Total operating expenses for 2002 also include $7.4 million related to severance costs, including benefits for several companywide workforce reduction programs that were completed in 2002.

Total operating expenses for the year ended December 31, 2002 also included $8.6 million for the impairment of goodwill associated with Mexico in our Specialty Products Group segment.

(3)

In May 2003, we prepaid a total of $75 million of revolving loans and $165 million of our term loans with the net cash proceeds from the issuance of $250 million of Senior Secured Notes. As a result, interest expense for 2003 included a $5.3 million charge for expensing a portion of previously capitalized financing fees incurred in connection with our credit facilities. In February 2004, we paid off our then existing term loan facility of $219.6 million and revolving loan facility of $20 million with proceeds from the issuance of $306 million Senior Secured Discount Notes. As a result, interest expense in 2004 included a $7.9 million charge for expensing a portion of our previously capitalized financing fees.

(4)

The Company adopted Statement of Financial Accounting Standard No. 150 ("SFAS 150"), Accounting for Certain Financial Instruments with Characteristics of Liabilities and Equity, effective January 1, 2004. As a result, dividends and accretion on our unconditional mandatory redeemable preferred stock are included in interest expense for 2004 and 2005 in the statement of operations. Dividends and accretion for the twelve months ended December 31, 2004 were $35.3 million and dividends and accretion for the three months ended March 31, 2004 and 2005 were $8.4 million and $9.3 million, respectively.

(5)

EBITDA from continuing operations reflects income from continuing operations before interest expense, income taxes, depreciation and amortization. We believe that EBITDA information enhances an investor's understanding of our ability to satisfy principal and interest obligations with respect to our

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indebtedness and to utilize cash for other purposes. EBITDA does not represent and should not be considered as an alternative to net income or cash flows from operating activities as determined by U.S. generally accepted accounting principles and may not be comparable to other similarly titled measures of other companies. In addition, there may be contractual, legal, economic or other reasons which may prevent us from satisfying principal and interest obligations with respect to our indebtedness and may require us to allocate funds for other purposes. A reconciliation of EBITDA from continuing operations to net cash provided by (used in) operating activities as set forth in our consolidated statements of cash flows is as follows:

		Years ended December 31,									Three months ended March 31,
		2002			2003			2004			2004			2005
		(Dollars in millions)
EBITDA from continuing operations		$	79.0		$	55.5		$	92.2		$	27.5		$	21.6
Adjustments:
	Interest expense		(75.3	)		(96.4	)		(145.7	)		(43.0	)		(35.7	)
	Income tax (expense) benefit		1.5			(5.2	)		(1.8	)		(1.7	)		(0.9	)
	Impairment of fixed assets		—			4.8			0.4			—			—
	Preferred dividends & accretion on preferred shares		—			—			35.3			8.4			9.3
	Amortization of deferred financing costs and accretion of debt discount		3.7			9.9			35.1			12.2			8.1
	Deferred income taxes		(5.4	)		1.5			0.2			0.7			(0.2	)
	Provision for loss on accounts receivable		2.6			1.7			1.6			—			—
	Non-cash plant closing costs		9.7			3.3			1.4			—			0.1
	Write-down of impaired goodwill and intangible assets		8.6			18.3			—			—			—
	Curtailment gain		—			—			1.6			—			—
	(Gain) loss on disposal of assets		0.4			1.4			0.5			—			0.1
	Minority interest		(0.1	)		0.1			(0.3	)		—			—
	Change in operating assets and liabilities, net of effects of acquisitions		27.7			(9.1	)		(21.9	)		(3.7	)		(9.8	)
Net cash provided by (used in) operating activities		$	52.4		$	(14.2	)	$	(1.4	)		0.4			(7.4	)

(6)

For purposes of this ratio, earnings consist of income from continuing operations before income taxes plus fixed charges. Fixed charges consist of (i) interest, whether expensed or capitalized, (ii) amortization of debt issuance costs and (iii) an allocation of one-third of the rental expense from operating leases, which we consider to be a reasonable approximation of the interest factor of operating lease payments. For the twelve months ended December 31, 2002, 2003 and 2004, earnings were insufficient to cover fixed charges by approximately $44.9 million, $109.1 million and $112.3 million. For the three months ended March 31, 2004 and 2005, earnings were insufficient to cover fixed charges by $24.4 million and $44.6 million, respectively.

(7)

The Company adopted Statement of Financial Accounting Standard No. 150 ("SFAS 150"), Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity, effective January 1, 2004. As a result, our Series A redeemable preferred stock, which has an unconditional mandatory redemption feature, was recorded as a liability on the date of adoption. In addition, effective January 1, 2004, the dividends and accretion on the preferred shares are included as a part of interest expense in the statement of operations. As a result of adopting SFAS 150, the Company's redeemable common shares that have been put for redemption by a shareholder have also been recorded as a liability.

(8)

The amount presented includes $0.1 million of proceeds from the sale of 720 shares of newly-created, non-voting Series B Redeemable Preferred Stock for a cash purchase price of $162 per share to selected officers of the Company. On February 14, 2005, 48 shares of non-voting Series B Redeemable Preferred Stock were repurchased from an officer for $162 per share.

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RISK FACTORS

The risks below are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially adversely affect our business operations. All of the following risks could affect our business, financial condition or results of operations. In such a case, you may lose all of or a part of your original investment and/or not receive any return on your investment. You should carefully consider the risks described below as well as other information and data included in this prospectus before participating in this exchange offer.

Risks related to the Senior Secured Discount Notes

Our substantial indebtedness could adversely affect our ability to raise additional capital to fund our operations, limit our ability to react to changes in the economy or our industry and prevent us from meeting our obligations under the Senior Secured Discount Notes.

        We are highly leveraged, which means that we have a large amount of indebtedness relative to our stockholders' deficit. We are highly leveraged particularly in comparison to some of our competitors.

        As of March 31, 2005, we would have had, on a pro forma basis after giving effect to the issuance of the Amended 2004 Notes, the following credit statistics:

	(dollars in millions)
Total debt	$	873.2
Shares subject to mandatory redemption(1)		239.2
Redeemable preferred stock(2)		0.1
Redeemable common stock(3)		6.6
Stockholders' equity (deficit)		(551.7	)

(1)

We adopted Statement of Financial Accounting Standard No. 150 ("SFAS 150"), Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity, effective January 1, 2004. As a result, our Series A redeemable preferred stock, which has an unconditional mandatory redemption feature, is recorded as a liability. Effective January 1, 2004, the dividends and accretion on the preferred shares are included as a part of interest expense in the statement of operations. In addition, as a result of adopting SFAS 150, the Company's redeemable common shares that have been put for redemption by a shareholder are recorded as a liability. The shares subject to mandatory redemption are as follow (in millions):

	March 31, 2005
Redeemable Preferred Shares 167,000 shares authorized, 140,973 shares outstanding as of March 31, 2005, designated as Series A, no par value with a redemption value of $1,000 per share plus accumulated dividends	$	232.8
18,200 Redeemable Common Shares that have been put for redemption by a shareholder, net of a shareholder note of $2.4 million		6.4
Total shares subject to mandatory redemption	$	239.2

The maximum cash settlement at the redemption date of June 1, 2011 (assuming no cash dividends are paid through the redemption date) is $680.6 million for the redeemable preferred shares and $6.4 million (net of the note receivable of $2.4 million) for the redeemable common shares that have been put for redemption by the shareholder.

(2)

Represents share of our Series B preferred stock, no par value. As of March 31, 2005, there were 720 shares of Series B preferred stock authorized, 672 of which were outstanding.

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(3)

Represents shares of our redeemable common stock that have not been put to us for redemption.

        Our ratio of earnings to fixed charges is a broad measure of how well our earnings from operations cover interest expense and other fixed charges. For purposes of this ratio, earnings consist of income before income taxes plus fixed charges. Fixed charges consist of (i) interest, whether expensed or capitalized, (ii) amortization of debt issuance costs and (iii) an allocation of one-third of the rental expense from operating leases, which we consider to be a reasonable approximation of the interest factor of operating lease payments. For the years ended December 31, 2004 and 2003, earnings were insufficient to cover fixed charges by approximately $112.3 million and $109.1 million, respectively. On a pro forma basis as of the first day of the applicable period, after giving effect to the issuance of the Amended 2004 Notes Senior Secured Discount Notes and the use of proceeds to pay off our then existing credit facilities, our earnings for the year ended December 31, 2004 and 2003 were insufficient to cover fixed charges by approximately $116.3 million and $120.5 million, respectively. In 2002, our earnings were insufficient to cover fixed charges by approximately $44.9 million. These deficits indicate that it may be difficult for us to generate sufficient earnings to cover fixed charges in future years.

        Our high degree of leverage could have important consequences for you, including the following: it may limit our ability to obtain additional financing for working capital, capital expenditures, product development, debt service requirements, acquisitions and general corporate or other purposes; a substantial portion of our cash flows from operations must be dedicated to the payment of principal and interest on our indebtedness and is not available for other purposes, including our operations, capital expenditures, new investments and future business opportunities; the debt service requirements on our other indebtedness may make it more difficult for us to make required payments on the Notes; it may limit our ability to adjust to changing market conditions and to withstand competitive pressures, putting us at a competitive disadvantage; and we may be vulnerable in a downturn in general economic conditions or in our business, or we may be unable to carry out capital spending that is important to our growth and productivity improvement programs.

We may not be able to generate sufficient cash to service all of our indebtedness, including the Senior Secured Discount Notes, and could be forced to take other actions to satisfy our obligations under our indebtedness, which may not be successful.

        Our estimated debt service for 2005 will be approximately $73.9 million, consisting of $2.0 million of scheduled mandatory principal payments, and approximately $71.9 million of interest payments.

        Our ability to make scheduled payments or to refinance our debt obligations depends on our financial and operating performance, which is subject to prevailing economic and competitive conditions and to certain financial, business and other factors beyond our control. These factors include:

•

fluctuations in interest rates;



•

unscheduled plant shutdowns;



•

increased operating costs;



•

prices and supply of raw materials; and



•

product prices and regulatory developments.

        We may not be able to maintain a level of cash flows from operating activities sufficient to permit us to pay the principal, premium, if any, and interest on our indebtedness. See "Disclosure regarding forward-looking statements" and "Management's discussion and analysis of financial condition and results of operations—Liquidity and capital resources."

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        If our cash flows and capital resources are insufficient to fund our debt service obligations, we may be forced to reduce or delay capital expenditures, sell assets, seek additional capital or restructure or refinance our indebtedness, including the Senior Secured Discount Notes. These alternative measures may not be successful and may not permit us to meet our scheduled debt service obligations. In the absence of such operating results and resources, we could face substantial liquidity problems and might be required to dispose of material assets or operations to meet our debt service and other obligations. Our revolving credit facility and indentures restrict our ability to dispose of assets and use the proceeds from the disposition. We may not be able to consummate those dispositions or to obtain the proceeds which we could realize from them and these proceeds may not be adequate to meet any debt service obligations then due. See "Description of credit facilities and other indebtedness" and "Description of Senior Secured Discount Notes."

        If we are unable to generate sufficient cash flow and are otherwise unable to obtain funds necessary to meet required payments of principal, premium, if any, and interest on our indebtedness, or if we otherwise fail to comply with the various covenants, including financial and operating covenants, in the instruments governing our indebtedness (including covenants in our indentures and credit facility), we could be in default under the terms of the agreements governing such indebtedness, including our indentures and revolving credit facility. In the event of such default, the holders of such indebtedness could elect to declare all the funds borrowed thereunder to be due and payable, together with accrued and unpaid interest, the lenders under the credit facility could elect to terminate their commitments thereunder, cease making further loans and institute foreclosure proceedings against our assets, and we could be forced into bankruptcy or liquidation. If our operating performance declines, we may, in the future, need to obtain waivers from the required lenders under our credit facility to avoid being in default. If we breach our covenants under the revolving credit facility and seek a waiver, we may not be able to obtain a waiver from the required lenders. If this occurs, we could be in default under the revolving credit facility and the lenders could exercise their rights, as described above, and we could be forced into bankruptcy or liquidation.

Our variable rate indebtedness subjects us to interest rate risk.

        Although we have substantially reduced our variable rate indebtedness, our borrowings under our revolving credit facility will be at variable rates of interest. An increase of 1% in interest rates would result in an additional $100,000 of annual interest expense for each $10.0 million in borrowings under our revolving credit facility. We will thus be exposed to interest rate risk to the extent of our borrowings under the revolving credit facility.

We may not be able to commence making interest payments on the Senior Secured Discount Notes when required in 2007 or to pay the principal plus accrued interest on the Senior Secured Discount Notes at maturity.

        Unless we elect to pay cash interest on the Senior Secured Discount Notes prior to December 15, 2006, the Senior Secured Discount Notes will accrete until that date, after which time we must begin making regular interest payments. Our ability to make scheduled payments of interest and, to the extent we have chosen to begin making cash interest payments prior to December 15, 2006, those interest payments, will depend upon our cash flow from operations and/or ability to generate cash from other sources, which cannot be assured. Our ability to pay the principal amount plus accrued interest under the Senior Secured Discount Notes at maturity in 2009 may depend on our ability to refinance other indebtedness or sell assets. There can be no assurance we can complete any such refinancing or sell such assets at an acceptable price at the required time, and thus no assurance we will be able to pay the principal and accrued interest on the Senior Secured Discount Notes at maturity.

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The terms of our revolving credit facility may prevent us from electing to commence making cash payments on the Senior Secured Discount Notes prior to December 15, 2006.

        Under the terms of the Senior Secured Discount Notes, we will have the option to commence making cash payments on the Senior Secured Discount Notes prior to December 15, 2006. However, the terms of our revolving credit facility prevent us from electing to make such cash payments (as well as payments with respect to additional interest, if any) for 18 months from the closing of the facility, and then only if we meet certain financial covenants at that time. Accordingly, we may be unable to elect to make cash payments on the Senior Secured Discount Notes prior to December 15, 2006.

Limits on our borrowing capacity under our revolving credit facility and other indebtedness may affect our ability to finance our operations.

        While our revolving credit facility provides for $100.0 million of commitments, our ability to borrow funds under our revolving credit facility is subject to the amount of eligible receivables and inventory in our borrowing base under the facility. Further, if we do not maintain a specified fixed charge coverage ratio, the availability under our revolving credit facility will be limited such that the total amount of our outstanding loans and letter of credit exposure under the facility may not exceed the lesser of 75% of the total amount of commitments under the facility or the borrowing base then in effect. Our ability to make borrowings under our revolving credit facility will also be conditioned upon our compliance with other covenants in the credit agreement, including financial covenants that apply when our borrowings exceed certain amounts. In addition, the terms of our indentures currently limit the amount we may borrow under our revolving credit facility. Because of these limitations, we may not always be able to meet our cash requirements with funds borrowed under our revolving credit facility. See "Description of credit facilities and other indebtedness—revolving credit facility."

If we default on our obligations to pay our indebtedness we may not be able to make payments on the Senior Secured Discount Notes.

        Any default under the agreements governing our indebtedness, including a default under our revolving credit facility that is not waived by the required lenders, and the remedies sought by the holders of such indebtedness, could make us unable to make payments on the Senior Secured Discount Notes. Any such failure could substantially decrease the market value of the Senior Secured Discount Notes. If we are unable to generate sufficient cash flow and are otherwise unable to obtain funds necessary to meet required payments of principal, premium, if any, and interest on our indebtedness, or if we otherwise fail to comply with the various covenants, including financial and operating covenants, in the instruments governing our indebtedness (including covenants in our indentures and our revolving credit facility), we could be in default under the terms of the agreements governing such indebtedness, including our revolving credit facility and the indentures governing our 2000/2002 Notes, our 2003 Notes, the Senior Secured Discount Notes and the Amended 2004 Notes. In the event of such default, the holders of such indebtedness could elect to declare all the funds borrowed thereunder to be due and payable, together with accrued and unpaid interest, the lenders under our revolving credit facility could elect to terminate their commitments thereunder, cease making further advances and institute foreclosure proceedings against our assets, and we could be forced into bankruptcy or liquidation. If our operating performance declines we may in the future need to obtain waivers from the required lenders under our revolving credit facility to avoid being in default. If we breach our covenants under our revolving credit facility and seek a waiver, we may not be able to obtain a waiver from the required lenders. If this occurs, we could be in default under the revolving credit facility and the lenders could exercise their rights, as described above, and we could be forced into bankruptcy or liquidation. See "Description of credit facilities and other indebtedness" and "Description of Senior Secured Discount Notes."

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We will rely significantly on the funds received from our subsidiaries to meet our debt service obligations on the Senior Secured Discount Notes, but our subsidiaries may not be able to distribute sufficient funds to us.

        Although we are an operating company, a significant amount of our revenue is generated by our subsidiaries. For the year ended December 31, 2004 and for the three months ended March 31, 2005 21% and 19%, respectively, of our net sales were generated by our subsidiaries. As a result, our ability to make payments on the Senior Secured Discount Notes and to satisfy our other debt service obligations will depend significantly on our receipt of dividends or other intercompany transfers of funds from our operating subsidiaries. The payment of dividends to us by our subsidiaries is contingent upon the earnings of those subsidiaries and is subject to various business considerations as well as certain contractual provisions which may restrict the payment of dividends and the transfer of assets to us. See "Description of credit facilities and other indebtedness" and "Description of Senior Secured Discount Notes—Certain covenants—Limitation on restrictions on distributions from restricted subsidiaries and negative pledges." In the event of bankruptcy, liquidation or reorganization of our subsidiaries, claims of creditors of our subsidiaries will generally have priority as to the assets of such subsidiaries over our claims as the holder of the equity of our subsidiaries.

There may not be sufficient collateral to pay all or any of the Senior Secured Discount Notes.

        Indebtedness under our revolving credit facility, certain interest rate protection and other hedging agreements, certain obligations in respect of cash management services and any other future indebtedness permitted to be incurred by us or the note guarantors under the indenture governing the Senior Secured Discount Notes are (or, in the case of such other future indebtedness, may be) secured on a first-priority basis by our Second-Priority Collateral and the Second-Priority Collateral of our domestic subsidiaries and certain of our foreign subsidiaries. The Second-Priority Collateral consists of substantially all inventory, receivables, deposit accounts, 100% of the capital stock of, or other equity interests in, existing and future domestic subsidiaries and foreign subsidiaries that are note guarantors, and 65% of the capital stock of, or other equity interests in, existing and future first-tier foreign subsidiaries (other than foreign subsidiaries that are note guarantors) (subject to certain limitations), investment property and certain other assets, in each case that are held by us or any of the note guarantors. The Second-Priority Collateral is comprised of substantially all of our and the note guarantors' material collateral that secure our revolving credit facility. The Senior Secured Discount Notes are secured by a first-priority lien on our First-Priority Collateral and a second-priority lien on our Second-Priority Collateral, both of which are subject to release as described more fully below. In the event of a bankruptcy, liquidation, dissolution, reorganization or similar proceeding against us or any note guarantor, the assets that are pledged for the benefit of other indebtedness on a first-priority basis, other than assets that constitute First-Priority Collateral, must be used first to pay such indebtedness in full before making any payments on the Senior Secured Discount Notes. In addition, to the extent other indebtedness has a first-priority security interest in the First-Priority Collateral or a second-priority security interest in the Second-Priority Collateral, the value of the assets comprising such collateral will have to be shared on a pari passu basis with such other indebtedness in the event of bankruptcy, liquidation, dissolution, reorganization or similar proceeding against us or any note guarantor.

        As of March 31, 2005 we had $552.3 million of senior debt including (i) $41.4 million of borrowings under our revolving credit facility (excluding $6.7 million of letters of credit outstanding) secured by a first-priority security interest in the Second-Priority Collateral and a second-priority security interest in the First-Priority Collateral, (ii) $250.0 million of 2003 Notes secured by a second-priority security interest in the First-Priority Collateral and the Second-Priority Collateral, (iii) $6.5 million of the Senior Secured Discount Notes secured by a first-priority security interest in the

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First-Priority Collateral and a second-priority security interest in the Second-Priority Collateral, (iv) $248.0 million of the Amended 2004 Notes secured by a first-priority security interest in the First-Priority Collateral and a second-priority security interest in the Second-Priority Collateral, and (v) $6.4 million of other senior secured debt. So long as such indebtedness can be incurred under the indenture, the indenture governing the Senior Secured Discount Notes allows an unlimited amount of indebtedness to be secured by a second-priority lien on the First-Priority Collateral securing the Senior Secured Discount Notes and either a first-priority lien or an equal and ratable lien with the Senior Secured Discount Notes with respect to Second-Priority Collateral, provided that, in each case, such indebtedness or other obligation could be incurred under the indenture. Any additional obligations secured by a lien on the collateral securing the Senior Secured Discount Notes (whether senior to or equal with the second-priority lien of the Senior Secured Discount Notes) will dilute the value of the collateral securing the Senior Secured Discount Notes. In particular, our revolving credit facility provides for additional borrowings of up to $100 million, all of which ranks prior to the Senior Secured Discount Notes with respect to the Second-Priority Collateral.

        In addition, because a portion of the collateral consists of pledges of the stock of our foreign subsidiaries that are note guarantors and a portion of the stock of our first tier foreign subsidiaries that are not note guarantors, the validity of those pledges under local law, if applicable, and the ability of the holders of the Senior Secured Discount Notes to realize upon that collateral under local law, to the extent applicable, may be limited by such local law, which limitations may or may not affect the first-priority liens.

        The value of the collateral at any time will depend on market and other economic conditions, including the availability of suitable buyers for the collateral. By their nature, some or all of the pledged assets may be illiquid and may have no readily ascertainable market value. The value of the assets pledged as collateral for the Senior Secured Discount Notes could be impaired in the future as a result of changing economic conditions, our failure to implement our business strategy, competition and other future trends. In the event of a foreclosure, liquidation, bankruptcy or similar proceeding, no assurance can be given that the proceeds from any sale or liquidation of the collateral will be sufficient to pay our obligations under the Senior Secured Discount Notes, in full or at all.

        Accordingly, there may not be sufficient collateral to pay all or any of the amounts due on the Senior Secured Discount Notes. Any claim for the difference between the amount, if any, realized by holders of the Senior Secured Discount Notes from the sale of the collateral securing the Senior Secured Discount Notes and the obligations under the Senior Secured Discount Notes will rank equally in right of payment with all of our other unsecured unsubordinated indebtedness and other obligations, including trade payables.

        Holders of Senior Secured Discount Notes will not control decisions regarding the Second-Priority Collateral. The holders of the first-priority security interests on the Second-Priority Collateral will control substantially all matters related to the Second-Priority Collateral, pursuant to the terms of the intercreditor agreement. Under the intercreditor agreement, any actions that may be taken in respect of the Second-Priority Collateral, including the ability to cause the commencement of enforcement proceedings against such collateral and to control the conduct of such proceedings, and the approval of amendments to, releases of such collateral from the lien of, and waivers of past defaults under, the collateral documents, will be at the direction of the holders of such first-priority security interests, and the trustee on behalf of the holders of the Senior Secured Discount Notes will not have the ability to control or direct such actions, even if the rights of the holders of the Senior Secured Discount Notes are adversely affected. Additional releases of collateral from the second-priority security interest on the Second-Priority Collateral securing the Senior Secured Discount Notes are permitted under some circumstances. Any release of all first-priority liens upon any collateral approved by the holders of the first-priority liens shall also release the second-priority liens securing the Senior Secured Discount Notes on the same collateral; provided that, after giving effect to the release, obligations secured by the

20

first-priority liens on the remaining collateral remain outstanding. See "Description of Senior Secured Discount Notes—Security" and "Description of Senior Secured Discount Notes—Amendments and waivers."

        Furthermore, the security documents allow us and our subsidiaries to remain in possession of, retain exclusive control over, to freely operate, and to collect, invest and dispose of any income from, the collateral securing the Senior Secured Discount Notes. Under certain circumstances, the indenture governing the Senior Secured Discount Notes permits the proceeds of asset sales to be used to purchase assets that are not "collateral." In such a case, the pool of assets securing the Senior Secured Discount Notes would be reduced and the Senior Secured Discount Notes would not be secured by such purchased assets.

        The indenture governing the Senior Secured Discount Notes and the security documents provide that, to the extent that any rule is adopted, amended or interpreted which would require the filing with the SEC (or any other governmental agency) of separate financial statements of any of our subsidiaries due to the fact that such subsidiary's capital stock, other securities or assets secure the Senior Secured Discount Notes, then such capital stock, other securities or assets will automatically be deemed not to be part of the collateral securing the Senior Secured Discount Notes to the extent necessary to not be subject to such requirement. In such event, the security documents will be amended, without the consent of any holder of Senior Secured Discount Notes, to the extent necessary to release the liens on such capital stock, other securities or assets. As a result, holders of the Senior Secured Discount Notes could lose all or a portion of their security interest in the collateral if any such rule comes into effect.

Rights of holders of Senior Secured Discount Notes in the collateral may be adversely affected by bankruptcy proceedings.

        The right of the collateral agent to repossess and dispose of the collateral securing the Senior Secured Discount Notes upon acceleration is likely to be significantly impaired by federal bankruptcy law if bankruptcy proceedings are commenced by or against us prior to or possibly even after the collateral agent has repossessed and disposed of the collateral. Under the U.S. Bankruptcy Code, a secured creditor, such as the collateral agent, is prohibited from repossessing its security from a debtor in a bankruptcy case, or from disposing of security repossessed from a debtor, without bankruptcy court approval. Moreover, bankruptcy law permits the debtor to continue to retain and to use the collateral, and the proceeds, products, rents, or profits of the collateral, even though the debtor is in default under the applicable debt instruments, provided that the secured creditor is given "adequate protection." The meaning of the term "adequate protection" may vary according to circumstances, but it is intended in general to protect the value of the secured creditor's interest in the collateral and may include cash payments or the granting of additional security, if and at such time the court in its discretion determines, for any diminution in the value of the collateral as a result of the stay of the repossession or disposition or any use of the collateral by the debtor during the pendency of the bankruptcy case. In view of the broad discretionary powers of a bankruptcy court, it is impossible to predict how long payments under the Senior Secured Discount Notes could be delayed following commencement of a bankruptcy case, whether or when the collateral agent would repossess or dispose of the collateral, or whether or to what extent holders of the Senior Secured Discount Notes would be compensated for any delay in payment or loss of value of the collateral through the requirements of "adequate protection." Furthermore, in the event the bankruptcy court determines that the value of the collateral is not sufficient to repay all amounts due on the Senior Secured Discount Notes after first paying the obligations of creditors having first-priority security interests in the Second-Priority Collateral, the holders of the Senior Secured Discount Notes would have "undersecured claims" as to the difference. Federal bankruptcy laws do not permit the payment or accrual of interest, costs, and attorneys' fees for "undersecured claims" during the debtor's bankruptcy case.

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Rights of holders of Senior Secured Discount Notes in the collateral may be adversely affected by the failure to perfect security interests in certain collateral.

        The security interests in the collateral securing the Senior Secured Discount Notes include assets, both tangible and intangible, whether now owned or acquired or arising in the future, of the Company and the note guarantors. Applicable law requires that certain property and rights acquired after the grant of a general security interest can only be perfected at the time such property and rights are acquired and identified. There can be no assurance that we will inform the trustee or the collateral agent of the future acquisition of property and rights that constitute collateral, and that the necessary action will be taken to properly perfect the security interest in such after acquired collateral. The trustee will not monitor the future acquisition of property and rights that constitute collateral, or take action to perfect the security interest in such acquired collateral. Such failure may result in the loss of the security interest therein or the priority of the security interest in favor of the Senior Secured Discount Notes against third parties. We are not required to and do not intend to perfect the security interests in collateral consisting of fixtures not located on mortgaged properties securing the Senior Secured Discount Notes. Such failure may result in the loss of the security interest therein or the priority of the security interest in favor of the Senior Secured Discount Notes against third parties.

The Senior Secured Discount Notes are structurally subordinated in right of payment to the indebtedness of those of our subsidiaries that are not guaranteeing the Senior Secured Discount Notes and, if the guarantees are deemed unenforceable, to those of our subsidiaries that are note guarantors, and the remaining assets of such subsidiaries may not be sufficient to make any payments on the Senior Secured Discount Notes.

        The Senior Secured Discount Notes are effectively subordinated to all liabilities of our subsidiaries which are not guarantors. In addition, although the guarantees provide the holders of the Senior Secured Discount Notes with a direct claim as a creditor against the assets of the note guarantors, the guarantees may not be enforceable as described in more detail below. If the guarantees by the note guarantors are not enforceable, the Senior Secured Discount Notes would be effectively subordinated to all liabilities of the note guarantors, including trade payables. As a result of being effectively subordinated to the liabilities of a subsidiary, if there was a dissolution, bankruptcy, liquidation or reorganization of such subsidiary, the holders of the Senior Secured Discount Notes would not receive any amounts with respect to the Senior Secured Discount Notes until after the payment in full of the claims of creditors of such subsidiary.

        Our subsidiaries that are not note guarantors generated 12.9% of our sales for the year ended December 31, 2004 and 12.9% of our net sales for the three months ended March 31, 2005. As of December 31, 2004, our subsidiaries that are not note guarantors accounted for 10.7% of our total assets and had total liabilities (excluding liabilities owed to us) of $24.6 million. As of March 31, 2005 our subsidiaries that are not note guarantors accounted for 10.5% of our total assets and had total liabilities (excluding liabilities owed to us) of $21.1 million.

        Our subsidiaries that are note guarantors generated 7.8% of our sales for the year ended December 31, 2004 and 6.5% of our sales for the three months ended March 31, 2005. As of December 31, 2004, our subsidiaries that are note guarantors accounted for 7.6% of our total assets and had total liabilities (excluding liabilities owed to us) of $13.3 million. As of March 31, 2005 our subsidiaries that are note guarantors accounted for 7.4% of our total assets and had total liabilities (excluding liabilities owed to us) of $13.8 million.

Federal and state fraudulent transfer laws permit a court to void the Senior Secured Discount Notes and the note guarantees, and if that occurs, you may not receive any payments on the Senior Secured Discount Notes.

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        Our issuance of the Senior Secured Discount Notes and the issuance of the guarantees by our note guarantors and the grant of security interests in the collateral security those obligations may be subject to review under federal and state fraudulent transfer and conveyance statutes. While the relevant laws may vary from state to state, under such laws the payment of consideration will be a fraudulent conveyance if (1) we paid the consideration with the intent of hindering, delaying or defrauding creditors or (2) we or any of our note guarantors, as applicable, received less than reasonably equivalent value or fair consideration in return for issuing either the Senior Secured Discount Notes or a guarantee, and, in the case of (2) only, one of the following is also true:

•

we or any of our note guarantors were or was insolvent, or rendered insolvent, by reason of such transactions;



•

paying the consideration left us or any of our note guarantors with an unreasonably small amount of capital to carry on the business; or



•

we or any of our note guarantors intended to, or believed that we or it would, be unable to pay debts as they matured.

        If a court were to find that the issuance of the Senior Secured Discount Notes or a guarantee or a grant of a security interest was a fraudulent conveyance, the court could avoid the payment obligations under the Senior Secured Discount Notes or such guarantee or further subordinate the Senior Secured Discount Notes or such guarantee to presently existing and future indebtedness of ours or of such note guarantor, or require the holders of the Senior Secured Discount Notes to repay any amounts received with respect to the Senior Secured Discount Notes or such guarantee. In the event of a finding that a fraudulent conveyance occurred, you may not receive any repayment on the Senior Secured Discount Notes. Further, the avoidance of the Senior Secured Discount Notes could result in an event of default with respect to our other debt and that of our subsidiaries, which could result in acceleration of such debt.

        Generally, an entity would be considered insolvent if, at the time it incurred indebtedness:

•

the sum of its debts was greater than the fair value of all its assets;



•

the present fair saleable value of its assets was less than the amount required to pay the probable liability on its existing debts and liabilities as they become due; or



•

it could not pay its debts as they become due.

Because each note guarantor's liability under its guarantee may be reduced to zero, avoided or released under certain circumstances, you may not receive any payments from some or all of the note guarantors.

        The holders of the Senior Secured Discount Notes have the benefit of the guarantees of the note guarantors. However, the guarantees by our note guarantors are limited to the maximum amount which the note guarantors are permitted to guarantee under applicable law. As a result, a note guarantor's liability under its guarantee could be reduced to zero, depending upon the amount of other obligations of the note guarantor. Further, under the circumstances discussed more fully above, a court under federal and state fraudulent conveyance and transfer statutes could void the obligations under a note guarantee or further subordinate it to all other obligations of the note guarantor. In addition, you will lose the benefit of a particular note guarantee if it is released under certain circumstances described under "Description of Senior Secured Discount Notes—The note guarantees."

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An active trading market may not develop for the Senior Secured Discount Notes, which may make the Senior Secured Discount Notes illiquid and adversely affect the market price quoted for the Senior Secured Discount Notes.

        You cannot be sure that an active trading market will develop for the Senior Secured Discount Notes. We do not intend to apply for a listing of the Senior Secured Discount Notes on a securities exchange or any automated dealer quotation system. We have been advised by J.P. Morgan Securities Inc. that as of the date of this prospectus J.P. Morgan Securities Inc. intends to make a market in the Senior Secured Discount Notes. J.P. Morgan Securities Inc. is not obligated to do so, however, and any market-making activities with respect to the Senior Secured Discount Notes may be discontinued at any time without notice. In addition, such market-making activity will be subject to limits imposed by the Securities Act and the Securities Exchange Act of 1934. Because J.P. Morgan Securities Inc. is our affiliate, J.P. Morgan Securities Inc. is required to deliver a current "market-making" prospectus and otherwise comply with the registration requirements of the Securities Act in any secondary market sale of the Senior Secured Discount Notes. Accordingly, the ability of J.P. Morgan Securities Inc. to make a market in the Senior Secured Discount Notes may, in part, depend on our ability to maintain a current market-making prospectus. In addition, the liquidity of the trading market in the Senior Secured Discount Notes, and the market price quoted for the Senior Secured Discount Notes, may be adversely affected by changes in the overall market for high yield securities and by changes in our financial performance or prospects or in the prospects for companies in our industry generally.

        We are controlled by J.P. Morgan Partners, LLC which is an affiliate of J.P. Morgan Securities Inc. As a result of this affiliate relationship, if J.P. Morgan Securities Inc. conducts any market-making activities with respect to the Notes, J.P. Morgan Securities Inc. will be required to deliver a market-making prospectus when effecting offers and sales of the Notes. For as long as a market-making prospectus is required to be delivered, the ability of J.P. Morgan Securities Inc. to make a market in the Notes may, in part, be dependent on our ability to maintain a current market-making prospectus for its use. If we are unable to maintain a current market-making prospectus, J.P. Morgan Securities Inc. may be required to discontinue its market-making activities without notice.

        On March 1, 2005, JPMorgan Chase & Co. announced that J.P. Morgan Partners, LLC will become independent when it completes the investment of its current $6.5 billion Global Fund and that the independent unit will retain portfolio management responsibility for the Global Fund and heritage investments of affiliates of J.P. Morgan Partners, LLC. However, at this time the Company has no additional information as to the impact, if any, that J.P. Morgan Partners, LLC becoming independent of JPMorgan Chase & Co. may have on the Company or its investments in the Company or on our obligation to maintain and amend a market-making prospectus for use by J.P. Morgan Partners, LLC or any the successor thereto after J.P. Morgan Partners, LLC becomes independent of JPMorgan Chase & Co.

Because the Senior Secured Discount Notes were issued with original issue discount, holders will pay tax on amounts before such amounts are received.

        The Senior Secured Discount Notes were issued at a discount from their stated principal amount for U.S. federal income tax purposes. Because the amount of discount is in excess of a statutorily defined de minimis amount, the discount will be subject to special rules applicable to original issue discount. Consequently, original issue discount will be included in the gross income of a U.S. holder of Senior Secured Discount Notes for U.S. federal income tax purposes in advance of the receipt of cash payments on the Senior Secured Discount Notes. For more information, see "Certain United States federal income tax consequences."

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Risks related to our business

Continued increases in resin prices or the loss of a key resin supplier could lead to increased costs and lower profit margins.

        Polyethylene, PVC, polypropylene and other resins and additives constitute the major raw materials for our products. We purchase most of our resin from major oil companies and petrochemical companies in North America. For the year ended December 31, 2004 and the three months ended March 31, 2005, resin costs comprised approximately 61% and 59%, respectively of our total manufacturing costs. Significant increases in the price of resins increase our costs, reduce our operating margins, and impair our ability to service our debt unless we are able to pass all of the increases on to our customers. The price of resins is a function of, among other things, manufacturing capacity, demand, and the price of crude oil and natural gas feed stocks. Resin shortages or significant increases in the price of resin have had and could continue to have a significant adverse effect on our business. Since the middle of 2002, we have experienced a period of significant uncertainty with respect to resin supplies and prices. High crude oil and natural gas pricing have had significant impact on the price and supply of resins. Prices for resin have risen dramatically during 2004 and are expected to continue to rise. Pliant's costs for resin on a weighted-average basis rose 29% from December 2003 to December 2004, with over half of that increase occurring in the fourth quarter of 2004.

        Major suppliers of resin have implemented price increases to cover their increases in petroleum costs, and to improve their operating margins as capacity utilization increases. Due in part to consolidation in the resin supply industry, suppliers have resisted the consumers' efforts to limit or defer the effect of these increases. Our goal is for the prices of our products generally to fluctuate with the price of resins. Approximately half of our sales are made on a transactional basis, which allows us to pass through resin price increases, although competitive market conditions in our industry from time to time limit our ability to pass the full cost of higher resin pricing through to our customers immediately or completely. The other approximately one half of our sales are made pursuant to customer contracts, most of which dictate the timing in our ability to pass through the increase. A large majority of these contracts allow resin cost increases to be passed along quarterly, with some allowing increased costs to be passed on more quickly and a small number requiring a longer delay. In combination, the cost to the Company of the gap between the speed in which increased costs are passed on to us and the time in which we can pass these costs on to our customers has a negative impact on both our results of operations and our working capital needs. This trend is industry wide and its impact was significant in 2004 and is likely to continue and possibly increase in the future.

        As one of the largest consumers of packaging resin in the United States, the Company is working on behalf of its customers with its suppliers to minimize the effects and the timing of the pass through of increased resin costs and to maximize the likelihood that resin supplies continue to the Company in sufficient quantities and on timetables necessary to meet the needs of our customers. We also regularly evaluate commodity hedging, collar agreements, and other protective strategies and will implement them if and when appropriate. However, if this period of high resin pricing continues, the limits on our ability to pass through these costs to our customers will exert downward pressure on profits and negatively effect our cash flow and our working capital requirements.

We operate in highly competitive markets and our customers may not continue to purchase our products, which could lead to our having reduced revenues and loss of market share.

        The markets in which we operate are highly competitive on the basis of service, product quality, product innovation and price. Small and medium-sized manufacturers that compete primarily in regional markets service a large portion of the film and flexible packaging market, and there are relatively few large national manufacturers. In addition to competition from many smaller competitors, we face strong competition from a number of large film and flexible packaging companies. Some of our

25

competitors are substantially larger, are more diversified, and have greater resources than we have, and, therefore, may have certain competitive advantages.

If we lose one or more of our major customers, our results of operations and our ability to service our indebtedness could be adversely affected.

        Although no single customer accounted for more than 10% of our net sales for the year ended December 31, 2004 and the three months ended March 31, 2005, we are dependent upon a limited number of large customers with substantial purchasing power for a significant percentage of our sales. For the year ended December 31, 2004 and March 31, 2005, our top ten customers accounted for approximately 29.7% and 28.6%, respectively of our net sales. Several of our largest customers satisfy some of their film requirements by manufacturing film themselves. The loss of one or more major customers, or a material reduction in sales to these customers as a result of competition from other film manufacturers, insourcing of film requirements or other factors, would have a material adverse effect on our results of operations and on our ability to service our indebtedness. See "Management's discussion and analysis of financial condition and results of operations" and "Business—Products, markets and customers."

Our ongoing efforts to achieve cost savings may not improve our operating results.

        We regularly evaluate our operations in order to identify potential cost savings. From time to time, we implement plant restructurings or other initiatives designed to improve the efficiency of our operations and reduce our costs. These initiatives may not result in cost savings, however, particularly if our estimates and assumptions relating to the anticipated cost savings prove to be incorrect. Further, even if a cost savings initiative is successful, we may not be able to improve our operating results as a result of other factors discussed in this prospectus, many of which are beyond our control, such as a reduction in the demand for our products or increases in raw material costs.

We may not be able to adequately protect our intellectual property, which could cause our revenues to decrease.

        We rely on patents, trademarks and licenses to protect our intellectual property, which is significant to our business. We also rely on unpatented proprietary know-how, continuing technological innovation and other trade secrets to develop and maintain our competitive position. We routinely seek to protect our patents, trademarks and other intellectual property, but our precautions may not provide meaningful protection against competitors or protect the value of our trademarks. In addition to our own patents, trade secrets and proprietary know-how, we license from third parties the right to use some of their intellectual property. We routinely enter into confidentiality agreements to protect our trade secrets and proprietary know-how. However, these agreements may be breached, may not provide meaningful protection or may not contain adequate remedies for us if they are breached.

Any future acquisitions may not be successfully integrated with our business and could cause our revenues to decrease, operating costs to increase or reduce cash flows, which in turn could adversely affect our ability to service our indebtedness.

        Our efforts to integrate any businesses acquired in the future may not result in increased profits. Difficulties encountered in any transition and integration process for newly acquired companies could cause revenues to decrease, operating costs to increase or reduce cash flows, which in turn could adversely affect our ability to service our indebtedness.

26

Our operations outside of the United States are subject to additional currency exchange, political, investment and other risks that could hinder us from making our debt service payments, increase our operating costs and adversely affect our results of operations.

        We operate facilities and sell products in several countries outside the United States. Our operations outside the United States include plants and sales offices in Mexico, Canada, Germany and Australia. As a result, we are subject to risks associated with selling and operating in foreign countries which could have an adverse affect on our financial condition and results of operations, our operating costs and our ability to make payments on our debt obligations, including our ability to make payments on the Notes and borrowings under our revolving credit facility. These risks include devaluations and fluctuations in currency exchange rates, unstable political conditions, imposition of limitations on conversion of foreign currencies into U.S. dollars and remittance of dividends and other payments by foreign subsidiaries. The imposition or increase of withholding and other taxes on remittances and other payments by foreign subsidiaries, hyperinflation in certain foreign countries, and restrictions on investments and other restrictions by foreign governments could also have a negative effect on our business and profitability.

We are controlled by J.P. Morgan Partners, LLC and its interests as an equity holder may conflict with yours as a creditor.

        Affiliates of J.P. Morgan Partners, LLC own approximately 55% of our outstanding common stock, 74% of our detachable warrants to purchase common stock issued in connection with our preferred stock and 59% of our outstanding preferred stock. Subject to certain limitations contained in the stockholders' agreement among us, our stockholders, and holders of detachable warrants to purchase common stock issued in connection with our preferred stock, J.P. Morgan Partners, LLC, through its affiliate, controls us. The interests of J.P. Morgan Partners, LLC may not in all cases be aligned with your interests as a holder of the Notes.

        On March 1, 2005, JPMorgan Chase & Co. announced that J.P. Morgan Partners, LLC will become independent when it completes the investment of its current $6.5 billion Global Fund and that the independent unit will retain portfolio management responsibility for the Global Fund and heritage investments of affiliates of J.P. Morgan Partners, LLC. However, at this time the Company has no additional information as to the impact, if any, that J.P. Morgan Partners, LLC becoming independent of JPMorgan Chase & Co. may have on the Company or its investments in the Company.

If we do not maintain good relationships with our employees, our business could be adversely affected by a loss of revenues, increased costs or reduced profitability.

        Although we consider our current relations with our employees to be good, if major work disruptions were to occur, our business could be adversely affected by, for instance, a loss of revenues, increased costs or reduced profitability. As of March 31, 2005, we had approximately 3,025 employees, of which approximately 740 employees were subject to a total of 8 collective bargaining agreements that expire on various dates between November 6, 2005 and June 30, 2007. The collective bargaining agreement covering our Langley union employees expired on February 28, 2005. We are currently operating under an informal extension of the terms of that agreement and are in negotiations with the union for a new collective bargaining agreement. We have had one labor strike in the United States in our history, which occurred at our Chippewa Falls, WI plant in March 2000 and lasted approximately two weeks. In October 2001, we entered into a five year agreement with the union representing the approximately 150 employees at our Chippewa Falls, WI manufacturing plant. We also had a temporary work stoppage at our Australia facility in 2001 that lasted approximately 30 days.

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The cost of complying with federal and state environmental laws could be significant and increase our operating costs.

        Complying with existing and future environmental laws and regulations that affect our business could impose material costs and liabilities on us. Our manufacturing operations are subject to certain federal, state, local and foreign laws, regulations, rules and ordinances relating to pollution, the protection of the environment and the generation, storage, handling, transportation, treatment, disposal and remediation of hazardous substances and waste materials. In the ordinary course of business, we are subject to periodic environmental inspections and monitoring by governmental enforcement authorities. We could incur substantial costs, including fines and civil or criminal sanctions, as a result of actual or alleged violations of environmental laws. In addition, our production facilities require environmental permits that are subject to revocation, modification and renewal. Violations of environmental permits can also result in substantial fines and civil or criminal sanctions. The ultimate costs under environmental laws and the timing of such costs are difficult to predict and potentially significant expenditures could be required in order to comply with environmental laws that may be adopted or imposed in the future.

Other Uncertainties

        In addition to the factors described above, we face a number of uncertainties, including: (1) general economic and business conditions, particularly a continuing economic downturn; (2) industry trends; (3) changes in demand for our products; (4) potential legislation and regulatory changes; (5) new technologies; (6) changes in distribution channels or competitive conditions in the markets or countries where we operate; and (7) changes in our business strategy or development plans.

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DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

        This prospectus includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. 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 and, in particular, appear under the headings "Summary," "Management's discussion and analysis of financial condition and results of operations" and "Business." When used in this prospectus, the words "estimates," "expects," "anticipates," "projects," "plans," "intends," "believes," "forecasts" and variations of such words or similar expressions are intended to identify forward-looking 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, management's expectations, beliefs and projections may not result or be achieved.

        There are a number of risks and uncertainties that could cause our actual results to differ materially from the forward-looking statements contained in this prospectus. Important factors that could cause our actual results to differ materially from the forward-looking statements we make in this prospectus are set forth in this prospectus, including under the heading "Risk factors." As stated elsewhere in this prospectus, such risks, uncertainties and other important factors include, among others:

•

general economic and business conditions, particularly an economic downturn;



•

industry trends;



•

increases in our leverage;



•

interest rate increases;



•

changes in our ownership structure;



•

raw material costs and availability, particularly resin;



•

competition;



•

the loss of any of our major customers;



•

changes in demand for our products;



•

new technologies;



•

changes in distribution channels or competitive conditions in the markets or countries where we operate;



•

costs of integrating any future acquisitions;



•

loss of our intellectual property rights;



•

foreign currency fluctuations and devaluations and political instability in our foreign markets;



•

changes in our business strategy or development plans;



•

availability, terms and deployment of capital;



•

availability of qualified personnel; and



•

increases in the cost of compliance with laws and regulations, including environmental laws and regulations.

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        There may be other factors that may cause our actual results to differ materially from the forward-looking statements.

        All forward-looking statements attributable to us or persons acting on our behalf apply only as of the date of this prospectus and are expressly qualified in their entirety by the cautionary statements included in this prospectus. 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.

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USE OF PROCEEDS

        This prospectus is delivered in connection with the sale of the Senior Secured Discount Notes by J.P. Morgan Securities Inc. in market-making transactions. We will not receive any of the proceeds from these transactions.

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CAPITALIZATION

        The following table sets forth our capitalization as of March 31, 2005.

		March 31, 2005
(Dollars in millions)		Actual			As Adjusted
Cash and cash equivalents		$	4.1		$	4.1
Total debt:
	Revolving credit facility(1)		41.4			48.9
	Amended 2004 Notes		—			248.0
	Senior Secured Discount Notes		254.5			6.5
	2003 Notes		250.0			250.0
	2000/2002 Notes		313.4			313.4
	Capital leases and insurance financing		6.4			6.4
	Total debt	$	865.7		$	873.2
Shares subject to mandatory redemption(2)			239.2			239.2
Redeemable preferred stock(3)			0.1			0.1
Redeemable common stock(4)			6.6			6.6
Stockholders' deficit			(549.0	)		(551.7	)
	Total capitalization	$	562.6		$	567.4

(1)

The amount shown does not include $6.7 million of letters of credit issued under our revolving credit facility. After giving effect to the borrowing base limitation in the revolving credit facility, we had $40.1 million available for borrowings under our $100 million revolving credit facility, which amount gives effect to $53.2 million of borrowings and $6.7 million of letters of credit outstanding. The amount outstanding under our revolving credit facility fluctuates on a daily basis. The $7.5 million difference between actual and as adjusted amounts represents borrowings under our revolving credit facility to be used to pay the consent consideration and fees and expense related to the consent solicitation paid in connection with the amended and restated indenture.

(2)

We adopted Statement of Financial Accounting Standard No. 150 ("SFAS 150"), Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity, effective January 1, 2004. As a result, our Series A redeemable preferred stock, which has an unconditional mandatory redemption feature is recorded as a liability. Effective January 1, 2004, the dividends and accretion on the preferred shares are included as a part of interest expense in the statement of operations. In addition, as a result of adopting SFAS 150, the Company's redeemable common shares that have been put for redemption by a shareholder are recorded as a liability, net of a shareholder note of $2.4 million.

The maximum each settlement at the redemption date of June 1, 2011 (assuming no cash dividends are paid through the redemption date) is $680.6 million for the redeemable preferred shares and $6.4 million (net of the note receivable of $2.4 million) for the redeemable common shares that have been put for redemption by the shareholder.

(3)

The amount presented includes $0.1 million of proceeds from the sale of 720 shares of newly-created, non-voting Series B Redeemable Preferred Stock for a cash purchase price of $162 per share to selected officers of the Company. On February 14, 2005, 48 shares of non-voting Series B Redeemable Preferred Stock were repurchased from an officer for $162 per share.

(4)

Represents shares of our redeemable common stock that have not been put to us for redemption.

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SELECTED FINANCIAL DATA

        The following selected financial data have been summarized from our consolidated financial statements and are qualified in their entirety by reference to, and should be read in conjunction with, such consolidated financial statements and the notes thereto, "Capitalization" and "Management's discussion and analysis of financial condition and results of operations."

																	Three months ended March 31, (unaudited)
		Years ended December 31,
(Dollars in millions)
		2000			2001			2002			2003			2004			2004			2005
Statement of operations data:(1)
	Net sales	$	843.8		$	840.4		$	850.9		$	894.5		$	968.7		$	236.8		$	262.9
	Cost of sales		696.7			665.1			693.7			758.2			826.8			198.5			228.9
	Gross profit		147.1			175.3			157.2			136.3			141.9			38.3			34.0
	Total operating expenses(2)		132.7			101.1			126.2			128.1			90.0			21.7			22.3
	Operating income (loss)		14.4			74.2			31.0			8.2			51.9			16.6			11.7
	Interest expense(3)(4)		(87.2	)		(76.0	)		(75.3	)		(96.4	)		(145.7	)		(43.0	)		(35.7	)
	Other income (expense), net		0.3			6.5			2.3			0.5			(0.7	)		(0.1	)		(0.2	)
	Income (loss) from continuing operations before income taxes		(72.5	)		4.7			(42.0	)		(87.8	)		(94.6	)		(26.5	)		(24.2	)
	Income tax expense (benefit)		(21.7	)		6.8			(1.5	)		5.2			1.6			1.7			0.9
	Loss from continuing operations		(50.8	)		(2.1	)		(40.5	)		(93.0	)		(96.2	)		(28.2	)		(25.1	)
	Loss from discontinued operations		—			—			(2.9	)		(21.3	)		(17.7	)		(2.6	)		(0.3	)
	Net income (loss)	$	(50.8	)	$	(2.1	)	$	(43.4	)	$	(114.3	)	$	(113.9	)	$	(30.8	)	$	(25.4	)
Other financial data:
	EBITDA from continuing operations(5)	$	54.2		$	127.7		$	79.0		$	55.5		$	92.2		$	27.5		$	21.6
	Net cash provided by (used in) operating activities		60.3			30.3			52.4			(14.2	)		(1.4	)		0.4			(7.4	)
	Net cash used in investing activities		(65.6	)		(87.3	)		(55.2	)		(17.0	)		(17.6	)		(3.0	)		(8.6	)
	Net cash provided by (used in) financing activities		0.3			55.0			12.4			46.0			25.5			4.9			16.2
	Depreciation and amortization		39.5			47.0			45.7			46.9			41.1			11.0			10.1
	Impairment of goodwill and intangible assets(2)		—			—			8.6			18.3			—			—			—
	Impairment of fixed assets(2)		—			—			—			4.8			0.4			—			—
	Restructuring and other costs(2)		19.4			(4.6	)		30.1			12.6			2.1			—			0.1
	Non-cash stock-based compensation expense		2.6			7.0			—			—			—			—			—
	Capital expenditures		65.6			56.4			49.2			17.0			24.1			3.0			9.0
	Ratio of earnings to fixed charges(6)		—			1.1	x		—			—			—			—			—

																	Three months ended March 31, (unaudited)
		December 31,
(Dollars in millions)
		2000			2001			2002			2003			2004			2004			2005
Balance sheet data (at period end):
	Cash and cash equivalents	$	3.1		$	4.8		$	1.6		$	3.3		$	5.6		$	3.3		$	4.1
	Working capital		57.6			58.4			45.8			70.7			78.5			77.4			88.8
	Total assets		785.0			851.7			853.2			786.8			777.1			783.4			786.0
	Total debt		687.4			713.3			736.4			783.7			842.3			800.3			865.8
	Shares subject to mandatory redemption(7)		—			—			—			—			229.9			203.0			239.2
	Total liabilities		885.9			903.0			960.1			992.4			1,291.3			1,213.0			1,328.2
	Redeemable preferred stock(8)		88.7			126.1			150.8			188.2			0.1			—			0.1
	Redeemable common stock		16.5			16.8			13.0			13.0			6.6			6.6			6.6
	Stockholders' equity (deficit)		(206.0	)		(194.5	)		(270.9	)		(407.1	)		(521.0	)		(436.4	)		(549.0	)

(1)

On September 30, 2004, we sold substantially all of the assets of Pliant Solutions Corporation which was previously reported as one of our operating segments. In accordance with SFAS No. 144, Accounting for the Impairment of Long-Lived Assets, Pliant Solutions is being accounted for as a discontinued operation and, accordingly, its assets are segregated from continuing operations, and its operating results are segmented and reported as discontinued operations in all periods

33

presented. Net sales for the three months ended March 31, 2004 were $7.4 million. Net sales for the nine months ended December 31, 2004 and the twelve months ended December 31, 2003 were $22.5 million and $34.9 million, respectively. Net sales for the eight months ended December 31, 2002 were $28.3 million. No tax benefits were recorded on the losses from discontinued operations or the loss on sale of discontinued operations as realization of these tax benefits is not certain.

(2)

Total operating expenses include restructuring and other costs of $0.1 million for the three months ended March 31, 2005 for severance and other costs associated with closure of our Harrisville, RI facility. Total operating expenses include restructuring and other costs of $2.1 million for the year ended December 31, 2004 for fixed asset impairment charges of $1.4 million and restructuring and other costs of $0.7 million related to closure of our Harrisville, RI facility. For the year ended December 31, 2003, restructuring and other costs of $12.6 million were included which consisted of $2.0 million for fixed asset impairment charges related to the closure of our facility in Shelbyville, IN, $0.7 million related to the closure of our facility in Brazil consisting primarily of fixed asset impairment charges, $2.6 million related to the closure and transfer of the production from our facility in Fort Edward, NY to our facilities in Mexico and Danville, KY, $1.4 million related to the consolidation of two plants in Mexico, $2.6 million related to the closure and transfer of production from our Merced, CA facility, and other costs related to the closure of our Shelbyville, IN facility, our Singapore office and a section of our Toronto facility. In addition, during 2003 we accrued the present value of future lease payments on three buildings we do not currently occupy in an amount equal to $3.3 million and a provision for litigation of $7.2 million.

Total operating expenses for the year ended December 31, 2003 also included $18.3 million for the impairment of goodwill and intangibles, consisting of $10 million in our Engineered Films segment for Canada, $7.3 million in our Specialty Products Group segment for Mexico and $1.0 million in our Industrial segment for Germany and Australia, and $4.8 million for impairment of fixed assets, $2.4 million in our Performance Films segment and $1.2 million in both our Specialty Products Group and Industrial Films segment.

Total operating expenses for 2002 include $30.1 million of restructuring and other costs, including $14.8 million related to the closure of our plant in Merced, CA, a portion of our plant in Shelbyville, IN, a part of our plant in Toronto, Canada, and one of our plants in Mexico. In addition, these costs reflect $7.9 million for the costs of relocating several of our production lines related to plant closures and costs associated with production rationalizations at several plants. Total operating expenses for 2002 also include $7.4 million related to severance costs, including benefits for several companywide workforce reduction programs that were completed in 2002.

Total operating expenses for the year ended December 31, 2002 also included $8.6 million for the impairment of goodwill associated with Mexico in our Specialty Products Group segment.

Total operating expenses for 2001 include $7.0 million of non-cash stock-based compensation expense, $3.0 million of restructuring and other costs, $4.0 million for expenses related to the relocation of our corporate headquarters, $6.0 million of fees and expenses relating to our supply chain cost initiative, and a $3.0 million increase in depreciation expenses relating primarily to the purchase of a new computer system. In addition, total operating expenses for 2001 include a credit for $7.6 million related to the reversal of a previously accrued charge for the closure of our Harrington, DE plant. In 2001, we decided not to proceed with our previously announced closure of our Harrington, DE plant.

Total operating expenses for 2000 include $10.8 million of costs related to the recapitalization and related transactions, $10.8 million of fees and expenses relating to our supply chain cost initiative, $19.4 million of restructuring and other costs, $7.1 million of costs related to the relocation of our corporate headquarters and a reduction in force, and $2.6 million of non-cash stock-based compensation expense.

(3)

In May 2003, we prepaid a total of $75 million of revolving loans and $165 million of our term loans with the net cash proceeds from the issuance of $250 million of Senior Secured Notes. As a result, interest expense for 2003 included a $5.3 million charge for expensing a portion of previously capitalized financing fees incurred in connection with our credit facilities. In February 2004, we paid off our then existing term loan facility of $219.6 million and revolving loan facility of $20 million with proceeds from the issuance of $306 million Senior Secured Discount Notes. As a result, interest expense in 2004 included a $7.9 million charge for expensing a portion of our previously capitalized financing fees.

(4)

In 2000, we refinanced most of our long-term debt and recorded a loss of $18.7 million to write-off unamortized deferred debt issuance costs and costs related to our tender offer for our 9¹/8% Senior Subordinated Notes due 2007. In 2004, we recognized $35.3 million of dividends and accretion on redeemable preferred stock as interest expense in accordance with SFAS 150, Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity.

(5)

EBITDA from continuing operations reflects income from continuing operations before interest expense, income taxes, depreciation and amortization. We believe that EBITDA information enhances an investor's understanding of our ability to satisfy principal and interest obligations with respect to our indebtedness and to utilize cash for other purposes. EBITDA does not represent and should not be considered as an alternative to net income or cash flows from operating activities as determined by U.S. generally accepted accounting principles and may not be comparable to other similarly titled measures of other companies. In addition, there may be contractual, legal, economic or other reasons which may prevent us from satisfying principal and interest obligations with respect to our indebtedness and may require us to allocate funds for other

34

purposes. A reconciliation of EBITDA to net cash provided by (used in) operating activities as set forth in our consolidated statements of cash flows is as follows:

																	Three months ended March 31, (unaudited)
(Dollars in millions)
		2000			2001			2002			2003			2004			2004			2005
EBITDA from continuing operations		$	54.2		$	127.7		$	79.0		$	55.5		$	92.2		$	27.5		$	21.6
Adjustments:
	Interest expense		(87.2	)		(76.0	)		(75.3	)		(96.4	)		(145.7	)		(43.0	)		(35.7	)
	Income tax (expense) benefit		21.7			(6.8	)		1.5			(5.2	)		(1.8	)		(1.7	)		(0.9	)
	Impairment of fixed assets		—			—			—			4.8			0.4			—			—
	Preferred dividends & accretion on preferred shares		—			—			—			—			35.3			8.4			9.3
	Amortization of deferred financing costs and accretion of debt discount		1.4			2.7			3.7			9.9			35.1			12.2			8.1
	Deferred income taxes		(25.8	)		3.0			(5.4	)		1.5			0.2			0.7			(0.2	)
	Provision for loss on accounts receivable		(0.2	)		0.3			2.6			1.7			1.6			—			—
	Non-cash compensation expense related to stock options		2.6			7.0			—			—			—			—			—
	Discount on stockholder note receivable		0.3			—			—			—			—			—			—
	Non-cash plant closing costs		14.8			(7.6	)		9.7			3.3			1.4			—			0.1
	Write-down of impaired goodwill and intangible assets		—			—			8.6			18.3			—			—			—
	Curtailment gain		—			—			—			—			1.6			—			—
	(Gain) loss on disposal of assets		0.5			(0.4	)		0.4			1.4			0.5			—			0.1
	Loss on extinguishment of debt		18.7			—			—			—			—			—			—
	Minority interest		—			0.3			(0.1	)		0.1			(0.3	)		—			—
	Change in operating assets and liabilities, net of effects of acquisitions		59.3			(19.9	)		27.7			(9.1	)		(21.9	)		(3.7	)		(9.8	)
Net cash provided by (used in) operating activities		$	60.3		$	30.3		$	52.4		$	(14.2	)	$	(1.4	)	$	0.4		$	(7.4	)

(6)

For purposes of this ratio, earnings consist of income from continuing operations before income taxes plus fixed charges. Fixed charges consist of (i) interest, whether expensed or capitalized, (ii) amortization of debt issuance costs and (iii) an allocation of one-third of the rental expense from operating leases, which we consider to be a reasonable approximation of the interest factor of operating lease payments. For the twelve months ended December 31, 2000, 2002, 2003, and 2004 earnings were insufficient to cover fixed charges by approximately $72.5 million, $44.9 million, $109.1 million, and $112.3 million, for the three months ended March 31, 2004 and 2005, earnings were insufficient to cover fixed charges by $24.4 million and $44.6 million, respectively.

(7)

The Company adopted Statement of Financial Accounting Standard No. 150 ("SFAS 150"), Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity, effective January 1, 2004. As a result, our Series A redeemable preferred stock, which has an unconditional mandatory redemption feature, was recorded as a liability on the date of adoption. In addition, effective January 1, 2004, the dividends and accretion on the preferred shares are included as a part of interest expense in the statement of operations. As a result of adopting SFAS 150, the Company's redeemable common shares that have been put for redemption by a shareholder have also been recorded as a liability.

(8)

The amount presented includes proceeds of $141.0 million from the issuance of our Series A Preferred Stock in 2000, 2001 and 2003, plus the accrued and unpaid dividends, less the unamortized discount due to detachable warrants to purchase common stock issued in connection with our Series A Preferred Stock and unamortized issuance costs which were $76.3 million and $29.1 million, respectively as of December 31, 2003. The amount as of December 31, 2004 includes $0.1 million of proceeds from the sale of 720 shares of newly-created, non-voting Series B Redeemable Preferred Stock to selected officers of the Company.

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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 the consolidated financial statements and notes which appear elsewhere in this prospectus. This section contains certain "forward-looking statements" within the meaning 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 "Disclosure regarding forward-looking statements" and "Risk factors" and elsewhere in this prospectus.

        All references in this section to the consolidated financial statements or condensed consolidated financial statements and related notes included elsewhere in this prospectus refer to those of Pliant Corporation and its subsidiaries.

Company Profile

        Pliant generates revenues, earnings and cash flows from the sale of film and flexible packaging products throughout the world. We manufacture these products at 24 facilities located in the United States, Australia, Canada, Germany and Mexico. Our 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 market for film and flexible packaging products.

Overview for the three months ended March 31, 2005 and the year ended December 31, 2004

        We recorded sales of $262.9 million in the first quarter of 2005. This is a 11.0% increase from sales of $236.8 million in the first quarter of 2004, stated on a comparable basis excluding the results of the Pliant Solutions segment (which was sold during the third quarter of 2004 and accounted for as a discontinued operation) for both periods. First quarter 2005 sales measured in pounds were 213.7 million, which represents a 3.3% decrease from the first quarter of 2004.

        For 2004, the Company's net sales were $968.7 million, up $74.2 million or 8.3% over 2003, excluding Pliant Solutions, which was sold in the third quarter of 2004 and is accounted for as a discontinued operation. This growth was in large part due to increased volume as trade pound sold for 2004 were 878.9 million, up 35.7 million or 4.2% from 843.2 million in 2003. Overall, average selling price per pound increased from $1.061 per pound to $1.102 per pound or 3.9% primarily due to pass-through of resin cost increases along with favorable product mix changes. Three of our four operating segments reported increased growth, with our Industrial Films segment leading the way with a $34.5 million, or 15.7%, increase in net sales.

        Segment profit, defined as net income adjusted for interest expense, income taxes, depreciation, amortization, restructuring and other non-cash charges (principally the impairment of goodwill, intangible assets and fixed assets), was $21.7 million for the first quarter of 2005, compared to $27.5 million for the first quarter of 2004, presented on a comparable basis excluding the results of the Pliant Solutions segment (which was sold during the third quarter of 2004 and accounted for as a discontinued operation) for both periods. Segment profit, presented in accordance with generally accepted accounting principles (GAAP), reflects income from continuing operations adjusted for interest expense, income taxes, depreciation, amortization, and restructuring charges. The decrease in segment profit of $5.8 between periods is primarily attributable to the impact of resin price increases, a decline in sales volume, increased freight and packaging costs and an unfavorable shift in product sales mix.

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        Average sales price ("ASP") for the three months ended March 31, 2005 was $1.230 per pound as compared to $1.073 per pound for the three months ended March 31, 2004. This 14.7% increase generated approximately $35 million in incremental sales. However, our raw material costs, of which 60% are resin related, increased approximately $34 million. Furthermore, while our waste in absolute terms declined nearly 25% due to internal waste reduction programs, waste in dollars increased approximately $3 million due to higher resin costs. The sales volume decline between periods yielded approximately $1 million less segment profit. Freight costs increased approximately $1 million between periods due to suppliers passing along energy cost increases. Finally, product mix shifts to more commodity based products away from value added products contributed approximately $2 million to the decline in segment profit.

        For the year ended December 31, 2004 segment profit was $94.6 million in 2004, up $3.4 million or 3.7% from 2003. Sales volume and mix contributed $9.8 million to the increased profit while operational excellence programs, including significant reductions in waste, improved by $15.5 million. Selling, general and administrative costs were better by $4.7 million. Offsetting these improvements was a $16.3 million negative impact from increased resin costs. This resin cost impact reflected a lag in our ability to increase selling prices as well as an adverse effect on waste costs and sales commissions. We use large quantities of polyethylene, PVC, and polypropylene and other resins in manufacturing our products. For the year ended December, 31, 2004, resin costs approximated 61% of our total manufacturing costs. Average resin prices increased approximately 29% during 2004 with half of the increase occurring in the fourth quarter of 2004. To address fluctuations in resin prices we have pass-through or cost-sharing arrangements covering a large portion of our sales, but most of these lag the increase in our cost by 30 to 90 days. We are implementing price increases for many customers that are currently not subject to pass-through adjustments and most new customer contracts contain resin pass-through agreements. However, if resin prices continue to rise, the delayed pass-through will exert downward pressure on short-term segment profit. Freight expenses increased by $4.6 million in 2004 as compared with 2003. In addition to these factors, at year-end we recorded an unfavorable $4.5 million non-cash adjustment to employee vacation accruals.

        On September 30, 2004, we sold substantially all the assets of our wholly owned subsidiary, Pliant Solutions Corporation. Pliant Solutions, previously reported as a separate operating segment, manufactured decorative and surface coverings through the conversion of various films into consumer packaged goods. In accordance with SFAS No. 144, Accounting for the Impairment of Long-Lived Assets, Pliant Solutions is being accounted for as a discontinued operation and, accordingly, the assets are segregated from continuing operations in the accompanying consolidated balance sheet, and its operating results are segmented and reported as discontinued operations in the consolidated statement of operations. Net sales for Pliant Solutions for the three months ended March 31, 2004 were $7.4 million, for the nine months ended September 30, 2004 were $22.5 million, for the twelve months ended December 31, 2003 were $34.9 million, and for the eight months ended December 31, 2002 were $28.3 million. No tax benefits were recorded on the losses from discontinued operations or the loss on sale of discontinued operations as realization of these tax benefits is not certain.

        In the third quarter of 2004, we closed our Harrisville, Rhode Island facility and moved its production to more modern and efficient facilities. The costs related to this restructuring plan are now anticipated to total $2.7 million, consisting primarily of $1.4 million of fixed asset impairments, $0.4 million in equipment relocation, $0.3 million in severance and other personnel related costs and $0.4 million of other costs. Through December 31, 2004, approximately $2.1 million of these costs have been incurred.

        Effective Janaury 1, 2004, the Company adopted Statement of Financial Accounting Standard No. 150 ("SFAS 150"), Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity. As a result, our Series A redeemable preferred stock, which has an unconditional mandatory redemption feature, was recorded as a liability on the date of adoption of SFAS 150 at fair

37

market value measured as the value of the securities on the date of issuance plus accretion of discount from the date of issuance through December 31, 2003 and the cumulative unpaid dividends from the date of issuance through December 31, 2003. Effective January 1, 2004, the dividends and accretion on the preferred shares are included as a part of interest expense in the statement of operations.

        In addition, as a result of adopting SFAS 150, the Company's redeemable common shares that have been put for redemption by a shareholder were recorded as a liability at fair value. The fair value was computed using the agreed upon redemption price per share times the number of shares put by the shareholder. In accordance with SFAS 150, prior periods were not restated.

        On September 24, 2004, the Company adopted a 2004 Restricted Stock Incentive Plan, pursuant to which we sold to our President and Chief Executive Officer and selected additional officers of the Company 704 shares of a total of 720 authorized shares of a newly-created, non-voting Series B Redeemable Preferred Stock for a cash purchase price of $162 per share. These shares were issued in private transactions with officers of the Company and therefore were exempt from the registration requirements of the Securities Act of 1933. On December 22, 2004, the remaining 16 authorized shares were issued to an officer for a cash purchase price of $162 per share.

        On February 17, 2004, we completed the sale of $306,000,000 in aggregate principal amount at maturity of 11¹/8% Senior Secured Discount Notes due 2009 (the "Senior Secured Discount Notes"). The net proceeds from such sale in the amount of $220.2 million (after deducting underwriters' fees) together with borrowings of $30 million under our revolving credit facility described below, were used to pay off our then existing term loan facilities in the amount of $219.6 million and our then existing revolving loan facility of $20 million and $3.8 million in fees and other costs, leaving $6.8 million of cash on hand. Subsequently, the Senior Secured Discount Notes were exchanged for publicly held notes on substantially similar terms.

Critical accounting policies

        In the ordinary course of business, we make a number of estimates and assumptions relating to the reporting of results of operations and financial position in the preparation of financial statements in conformity with generally accepted accounting principles. Actual results could differ significantly from those estimates under different assumptions and conditions. We believe the following discussion addresses our most critical accounting policies. These policies require management to exercise judgments that are often difficult, subjective and complex due to the necessity of estimating the effect of matters that are inherently uncertain.

        Revenue recognition.    Sales revenue is recognized when title transfers, the risks and rewards of ownership have been transferred to the customer, the price is fixed and determinable and collection of the related receivable is probable, which is generally at the time of shipment.

        We have several rebate programs with certain of our customers and a cash discount program on accounts receivable. These costs are estimated at the time of sale and are reported as a reduction to sales revenue. Periodic adjustments are made as a part of our ongoing evaluation of all receivable related allowances.

        Accounts receivable.    We evaluate accounts receivable on a quarterly basis and review any significant customers with delinquent balances to determine future collectibility. We base our determinations on legal issues (such as bankruptcy status), past history, current financial and credit agency reports, and the experience of the credit representatives. We reserve accounts that we deem to be uncollectible in the quarter in which we make the determination. We maintain additional reserves based on our historical bad debt experience. Although there is a greater risk of uncollectibility in an economic downturn, we believe, based on past history and proven credit policies, that the net accounts receivable as of March 31, 2005 are of good quality.

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        Goodwill and other identifiable intangible assets.    Goodwill associated with the excess purchase price over the fair value of assets acquired is currently not amortized. This is in accordance with Statement of Financial Accounting Standards No. 142 effective for fiscal years beginning after December 15, 2001. Goodwill is tested annually for impairment or more frequently if circumstances indicate that they may be impaired. Other identifiable intangible assets, such as customer lists, and other intangible assets are currently amortized on the straight-line method over their estimated useful lives. These assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may be less than the undiscounted cash flows.

        Retirement plans.    We value retirement plan assets and liabilities based on assumptions and actuarial valuations. Assumptions for the retirement plans are subject to the occurrence of future events, which are out of our control and could differ materially from the amounts currently reported.

        Insurance.    Our insurance for workers' compensation and employee-related health care benefits are covered using high deductible insurance policies. A third-party administrator is used to process such claims. We require all workers' compensation claims to be reported within 24 hours. As a result, we accrue our workers' compensation liability based upon the claim reserves established by the third-party administrator each month. Our employee health insurance benefit liability is based on our historical claims experience rate. Our earnings would be impacted to the extent actual claims vary from historical experience. We review our accruals associated with the exposure to these liabilities for adequacy at the end of each reporting period.

        Inventory reserves.    Each quarter we review our inventory and identify slow moving and obsolete items. Thereafter, we create allowances and reserves based on the realizable value of specific inventory items.

        Fixed asset impairments.    We review our fixed assets at each manufacturing facility as a group of assets with a combined cash flow. Any difference between the future cash flows and the carrying value of the asset grouping is recorded as a fixed asset impairment. In addition, we periodically review any idle production lines within a manufacturing facility to determine if the assets need to be disposed.

        Deferred taxes.    We record deferred tax assets and liabilities for the differences in the carrying amounts of assets and liabilities for financial and tax reporting purposes. Deferred tax assets include amounts for net operating loss, foreign tax credit and alternative minimum tax credit carry forwards. Valuation allowances are recorded for amounts that management believes are not recoverable in future periods.

Recent accounting pronouncements

        In December 2004, the FASB issued SFAS 123(R) (revised December 2004), Share-Based Payment, which is a revision of SFAS 123, Accounting for Stock-Based Compensation, and supersedes APB Opinion No. 25, Accounting for Stock Issued to Employees. This statement requires that the fair value at the grant date resulting from all share-based payment transactions be recognized in the financial statements. Further SFAS 123(R) requires entities to apply a fair-value based measurement method in accounting for these transactions. The minimum value method currently used by the Company is not allowed and the Company will be required to adopt the prospective method as proscribed by SFAS 123R. This value is recorded over the vesting period. This statement is effective for the first fiscal year period beginning after June 15, 2005. We are currently evaluating the provisions of SFAS 123(R), and the impact on our consolidated financial position and results of operations.

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Results of operations

        The following table sets forth the amount of certain statement of operations items and such amounts as a percentage of net sales, for the periods indicated.

													Three months ended March 31,
(Dollars in millions)
	2002				2003				2004				2004			2005
													(unaudited)
Net sales	$	850.9	100.0	%	$	894.5	100.0	%	$	968.7	100.0	%	236.8	100.0	%	262.9	100.0	%
Cost of sales		693.7	81.5	%		758.2	84.8	%		826.8	85.3	%	198.5	83.8	%	228.9	87.0	%
Gross profit		157.2	18.5	%		136.3	15.2	%		141.9	14.7	%	38.3	16.2	%	34.0	13.0	%
Operating expenses before restructuring and other costs, goodwill and asset impairment costs		87.5	10.3	%		92.4	10.3	%		87.5	9.0	%	21.7	9.2	%	22.2	8.5	%
Restructuring and other costs		30.1	3.6	%		12.6	1.4	%		2.1	0.2	%	—	—	%	0.1	—	%
Impairment of goodwill and intangible assets		8.6	1.0	%		18.3	2.1	%		—	—	%	—	—	%	—	—	%
Impairment of fixed assets		—	—	%		4.8	0.5	%		0.4	0.1	%	—	—	%	—	—	%
Total operating expenses		126.2	14.9	%		128.1	14.3	%		90.0	9.3	%	21.7	9.2	%	22.3	8.5	%
Operating (loss) income	$	31.0	3.6	%	$	8.2	0.9	%	$	51.9	5.4	%	16.6	7.0	%	11.7	4.5	%

For the three months ended March 31, 2005 compared with the three months ended March 31, 2004

Net Sales

        Net sales increased by $26.1 million, or 11.0%, to $262.9 million for the first quarter of 2005 from $236.8 million for the three months ended March 31, 2005. The increase consisted of a 3.3% decrease in our in sales volume and a 14.7% increase in our average selling prices. See "Operating Segment Review" below for a detailed discussion of sales volumes and selling prices by segment and division.

Gross Profit

        Gross profit decreased by $4.3 million, or 11.2%, to $34.0 million for the first quarter of 2005, from $38.3 million for the first quarter of 2004. This decrease was primarily due to selling price increasing at rates that were insufficient to compensate for increased resin prices, decreased sales volumes, and mix change in customer purchasing to more commodity based products. See "Operating Segment Review" below for a detailed discussion of the margin variances by segment.

Total Operating Expenses before Restructuring and Other Costs

        Total operating expenses before restructuring and other costs increased $0.5 million, or 2.3%, to $22.2 million for the first quarter of 2005, from $21.7 million for the first quarter of 2004. This increase was attributable to a $0.2 million, or 1.1% increase in selling and administrative expenses and $0.2 million, or 9.7% increase in research and development costs.

Restructuring and Other Costs

        Restructuring and other costs were $0.1 million for the first quarter of 2005, compared to none for the first quarter of 2004. The costs for the first quarter of 2005 included $0.1 million of period costs related to the closure of our Harrisville, Rhode Island plant.

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Operating Income

        Operating income decreased by $4.9 million, to $11.7 million for the first quarter of 2005, from $16.6 million for the first quarter of 2004, due to the factors discussed above.

Interest Expense

        Interest expense on current and long-term debt decreased by $8.2 million, or 23.7%, to $26.4 million for the first quarter of 2004, from $34.6 million for the first quarter of 2004. This decrease was principally due to a charge of $10.1 million in the first quarter of 2004 for the write-off of previously capitalized financing fees and interest rate derivative costs. Excluding this prior year write-off interest expense increased $1.9 million due to higher interest costs resulting from the accretion of the issue discount associated with our senior secured discount notes issued in February 2004 used to repay bank debt that carried a lower interest rate.

        Interest expense on preferred stock for the first quarter of 2005 and 2004 of $9.3 million and $8.4 million, respectively, reflects the dividends and accretion on our redeemable preferred stock of the Company that are classified as interest expense pursuant to SFAS 150.

Income Tax Expense

        Income tax expense for the first quarter of 2005 was $0.9 million on pretax losses of $24.2 million, compared to income tax expense of $1.7 million on pretax losses of $26.5 million for the same period in 2004. Income tax benefits related to net operating losses in the United States were offset by a valuation allowance as the realization of these tax benefits is not certain. The income tax expense in the statements of operations primarily reflects foreign income taxes.

Loss from Continuing Operations

        Loss from continuing operations decreased by $3.0 million to $25.1 million for the first quarter of 2005, from $28.1 million for the first quarter of 2004, due to the factors discussed above.

Year ended December 31, 2004 compared with the year ended December 31, 2003

        Net sales.    Net sales increased by $74.2 million, or 8.3%, to $968.7 million for the year ended December 31, 2004 from $894.5 million for the year ended December 31, 2003. The increase was primarily due to a 4.2% increase in sales volume and a 3.9% increase in our average selling prices. See "Operating segment review" below for a detailed discussion of sales volumes and selling prices by segment and division.

        Gross profit.    Gross profit increased by $5.6 million, or 4.1%, to $141.9 million for the year ended December 31, 2004, from $136.3 million for the year ended December 31, 2003. This increase was due to better volume and mix by $9.8 million, improvements in manufacturing conversion costs of $10.1 million, and $5.4 million in waste improvements. Partially offsetting these was $11.2 million from the impact of rising resin costs which could not be immediately passed along in customer prices and a $3.1 million unfavorable impact on waste. Higher freight costs adversely affected gross margins by $4.6 million.

        Total operating expenses before restructuring and other costs.    Total operating expenses before restructuring and other costs decreased by $4.9 million, or 5.3%, to $87.5 million for the year ended December 31, 2004 from $92.4 million for the year ended December 31, 2003. This decrease includes a provision for litigation of $7.2 million recorded in 2003. Excluding the 2003 litigation provision, other operating expenses increased $2.3 million primarily due to increased sales commissions.

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        Restructuring and other costs.    Restructuring and other costs were $2.1 million for the year ended December 31, 2004 as compared to $12.6 million for the year ended December 31, 2003, a decrease of $10.5 million. These costs in 2004 include $1.4 million in fixed asset impairment charges and severance and other costs of $0.2 million and $0.5 million, respectively related to the closure of our Harrisville, facility. Restructuring and other costs for the year ended December 31, 2003 included $2.0 million for fixed asset impairment charges related to the partial closure of our facility in Shelbyville, IN, $0.7 million related to the closure of our facility in Brazil consisting primarily of fixed asset impairment charges, $2.6 million related to the closure and transfer of the production from our facility in Fort Edward, NY to our facilities in Mexico and Danville, KY, $1.4 million related to the consolidation of two plants in Mexico, $2.6 million related to the closure and transfer of production from our Merced, CA facility, and other costs related to the closure of our Shelbyville, IN facility. In addition, during 2003 we accrued the present value of future lease payments on three buildings we do not currently occupy in an amount equal to $3.3 million. We also closed our office in Singapore in the fourth quarter of 2003.

        Impairment of goodwill and intangible assets.    There were no impairment charges for goodwill or intangible assets in the year ended December 31, 2004. In the year ended December 31,2003 goodwill impairment charges totaling $18.3 million were recorded, including $10.1 million in our Engineered Films segment for Canadian operations, $7.2 million in our Specialty Products Group segment related to Mexico and $1.0 million in our Industrial segment related to Australia and Germany.

        Impairment of fixed assets.    These charges reflect costs associated with abandoning production lines and related equipment with total carrying values of $0.4 million in our Engineered Films and Industrial Films segments in the year ended December 31, 2004 and $2.4 million, $1.2 million and $1.2 million in our Performance Films, Specialty Products Group and Industrial segments, respectively, in the year ended December 31, 2003.

        Operating income (loss).    Operating income increased by $43.7 million to $51.9 million for the year ended December 31, 2004 from $8.2 million for the year ended December 31, 2003, due to the factors discussed above.

        Interest expense.    Interest expense increased $49.3 million, or 51%, to $145.7 million for the year ended December 31, 2004 from $96.4 million for 2003. Effective January 1, 2004, dividends and accretion on the preferred shares are included as a part of interest expense in the statement of operations. For the year ended December 31, 2004 these costs were $35.3 million. Furthermore, the increase in interest expense resulted from higher interest costs from the issuance of our $306 million Senior Secured Discount Notes in February 2004 and our $250 million Senior Secured Notes in May of 2003. Also, the write-off of an incremental $2.6 million of previously capitalized financing fees, as a result of the repayment of our old bank credit facilities from the proceeds of the Senior Secured Discount Notes, contributed to the increase.

        Other income (expense).    Other expense was $(0.7) million for the year ended December 31, 2004, as compared to other income of $0.5 million for the year ended December 31, 2003. Other expense for the year ended December 31, 2004 includes $1.3 million loss on the sale of real property, $0.1 million currency gain, and $0.5 million other less significant items. Other expense for 2003 included a $1.4 million for losses on disposal of real property, $0.1 million currency gain, $0.2 million of royalty income, $0.2 million of rental income, and $1.4 million of other less significant items.

        Income tax expense (benefit).    In 2004 our income tax expense was $1.6 million, compared to an income tax expense of $5.2 million in 2003. These amounts represent effective tax rates of 1.7% and 5.9% for the years ended December 31, 2004 and 2003, respectively. The fluctuation in the effective tax rate is principally the result of foreign tax rate differences, the provision for valuation allowances, the write-off of goodwill and the accrued dividends on preferred stock. As of December 31, 2004, our

42

deferred tax assets totaled approximately $125.7 million, of which $100.3 million related to net operating loss carry forwards. Our deferred tax liabilities totaled approximately $83.5 million. Due to uncertainty regarding the timing of the future reversals of existing deferred tax liabilities, the realization of our foreign tax credit carry forwards, and the realization of other deferred tax assets and carry forwards, we have recorded valuation allowances of approximately $61.7 million to offset the net operating loss carry forward and certain other deferred tax assets and carry forwards. Net taxes of zero were provided for the losses from discontinued operations due to any potential tax benefit being offset by the valuation allowance for net operating loss carry forwards.

Year ended December 31, 2003 compared with the year ended December 31, 2002

        Net sales.    Net sales increased by $43.6 million, or 5.1%, to $894.5 million for the year ended December 31, 2003 from $850.9 million for the year ended December 31, 2002. The increase was primarily due to an 8.3% increase in average selling prices, partially offset by a 3.0% decrease in sales volume. Our average selling prices increased primarily due to the pass through of increases in our raw material costs. See "Operating segment review" below for a detailed discussion of sales volumes and selling prices by segment and division.

        Gross profit.    Gross profit decreased by $20.9 million, or 13.3%, to $136.3 million for the year ended December 31, 2003, from $157.2 million for the year ended December 31, 2002. This decrease was primarily due to lower aggregate sales volumes and lower margins in certain segments. See "Operating segment review" below for a detailed discussion of the sales volumes and margins by segment.

        Total operating expenses before restructuring and other costs.    Total operating expenses before restructuring and other costs increased $4.9 million, or 5.6%, to $92.4 million for the year ended December 31, 2003 from $87.5 million for the year ended December 31, 2002. This increase was principally due to severance costs of $1.1 million related to recent organizational changes, increased lease expenses resulting from a sale-leaseback of equipment we entered into during the third quarter of 2002, as well as increases in legal, consulting, and commissions expense. The increase in total operating expenses was partially offset by a general decrease in sales and administrative costs. In addition, we recorded a provision for litigation of $7.2 million in 2003.

        Restructuring and other costs.    Restructuring and other costs were $12.6 million for the year ended December 31, 2003 as compared to $30.1 million for the year ended December 31, 2002. The costs for the year ended December 31, 2003 included $2.0 million for fixed asset impairment charges related to the partial closure of our facility in Shelbyville, IN, $0.7 million related to the closure of our facility in Brazil consisting primarily of fixed asset impairment charges, $2.6 million related to the closure and transfer of the production from our facility in Fort Edward, NY to our facilities in Mexico and Danville, KY, $1.4 million related to the consolidation of two plants in Mexico, $2.6 million related to the closure and transfer of production from our Merced, CA facility, and other costs related to the closure of our Shelbyville, IN facility. In addition, during 2003 we accrued the present value of future lease payments on three buildings we do not currently occupy in an amount equal to $3.3 million. We also closed our office in Singapore in the fourth quarter of 2003. Restructuring and other costs for 2002 reflect approximately $13.2 million related to the partial closure of our Shelbyville, IN facility (including non-cash charges of $12.2 million related to impaired assets), $3.7 million related to the closure of our Merced, CA facility (including non-cash charges of $0.7 million related to impaired assets), $3.9 million related to costs associated with moving production lines purchased in the Uniplast acquisition, approximately $7.4 million related to severance costs related to several company-wide workforce reduction programs implemented in 2002, approximately $2.3 million related to costs associated with moving production equipment from our Fort Edward, NY facility to our Mexico facility, a non-cash charge of $1.0 million related to the impairment of certain manufacturing assets in our U.S.

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plants and approximately $3.0 million related to other costs associated with re-alignment of production resources at several other plants. See Note 3 to the consolidated financial statements included elsewhere in this report.

        Impairment of goodwill and intangible assets.    In the year ended December 31, 2003, goodwill impairment charges totaling $18.3 million were recorded, including $10.1 million in our Engineered Films segment for Canadian operations, $7.2 million in our Specialty Products Group segment related to Mexico and $1.0 million in our Industrial segment related to Australia and Germany. In the year ended December 31, 2002, goodwill impairments of $8.6 million were recorded related to Mexico in our Specialty Products Group segment.

        Impairment of fixed assets.    These charges reflect costs associated with abandoning production lines and related equipment with carrying values of $2.4 million, $1.2 million and $1.2 million in our Performance Films, Specialty Products Group and Industrial Segments, respectively.

        Operating income (loss).    Operating income decreased by $22.8 million to $8.2 million for the year ended December 31, 2003 from $31.0 million for the year ended December 31, 2002, due to the factors discussed above.

        Interest expense.    Interest expense increased $21.1 million, or 28%, to $96.4 million for the year ended December 31, 2003 from $75.3 million for 2002. The increase in interest expense resulted from higher interest costs from the issuance of $100 million of subordinated debt in April 2002 and $250 million of Senior Secured Notes in May 2003. In addition, interest expense for 2003 included a $5.3 million charge in the second quarter of 2003 for previously capitalized financing fees written-off as a result of the repayment of a portion of our credit facilities from the proceeds of the 11¹/8% Senior Secured Notes in May 2003.

        Other income (expense).    Other income was $0.5 million for the year ended December 31, 2003, as compared to other income of $2.3 million for the year ended December 31, 2002. Other income for 2003 included $1.4 million of losses on disposal of real property, $0.1 million of currency gain, $0.2 million of royalty income, $0.2 million of rental income, and $1.4 million of other less significant items. Other income for 2002 included $0.7 million related to a settlement with a customer in our Industrial segment and $1.6 million of other less significant items.

        Income tax expense (benefit).    In 2003 our income tax expense was $5.2 million, compared to an income tax benefit of $1.5 million in 2002. These amounts represent effective tax rates of 5.9% and (3.5%) for the years ended December 31, 2003 and 2002, respectively. The fluctuation in the effective tax rate is principally the result of foreign tax rate differences, the provision for valuation allowances and the write-off of goodwill. As of December 31, 2003, our deferred tax assets totaled approximately $105.8 million, of which $78.3 million related to net operating loss carry forwards. Our deferred tax liabilities totaled approximately $84.5 million. Due to uncertainty regarding the timing of the future reversals of existing deferred tax liabilities and the realization of our foreign tax credit carry forwards, we have recorded a valuation allowance of approximately $39.7 million to offset the net operating loss carry forwards and the foreign tax credit carry forwards.

Operating Segment Review

General

        Operating segments are components of our business 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. We evaluate the performance of our operating segments based on net sales (excluding intercompany sales) and segment profit. The segment profit reflects income before interest expense, income taxes, depreciation, amortization, restructuring and other costs and

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other non-cash charges. For more information on our operating segments, including a reconciliation of segment profit to income before taxes, see Note 14 to the consolidated financial statements included elsewhere in this report.

        We have four operating segments: Specialty Products Group, Industrial Films, Engineered Films and Performance Films.

Summary of segment information (in millions of dollars) for the three months ended March 31, 2005 compared with the three months ended March 31, 2004 (unaudited):

		Specialty Products Group		Industrial Films		Engineered Films		Performance Films		Corporate/ Other			Total
Three months ended March 31, 2005
	Total net sales	$	102.8	$	72.8	$	59.6	$	25.0	$	2.7		$	262.9
	Segment profit		11.3		6.4		8.1		3.6		(7.6	)		21.8
Three months ended March 31, 2004
	Total net sales	$	96.1	$	58.3	$	55.4	$	25.8	$	1.2		$	236.8
	Segment profit		13.4		6.7		9.9		4.4		(6.9	)		27.5

Three months ended March 31, 2005 compared with the three months ended March 31, 2004

Specialty Products Group

        Net sales.    The net sales of our Specialty Products Group segment increased $6.7 million, or 7.0% to $102.8 million for the quarter ended March 31, 2005 from $96.1 million for the quarter ended March 31, 2004. This increase reflects a 14.7% increase in our average selling prices, offset by a sales volume decrease of 6.7%.

        Net sales in our Specialty Films division increased $2.3 million, or 4.9%, to $49.9 million for the quarter ended March 31, 2005 from $47.6 million for the quarter ended March 31, 2004. This increase reflects an increase in our average selling prices of 12.1% offset by a decrease in sales volume of 6.4% as a result of market share loss of a major client and Asian competition. Net sales in our Printed Products Films division increased $4.4 million, or 9.1%, to $52.9 million for the quarter ended March 31, 2005 from $48.5 million for the quarter ended March 31, 2004. This increase reflects an increase in our average selling prices of 17.4% offset by a decrease in sales volume of 7.0% primarily in our Mexican plant, and as a result of competitive pricing in our flexible products markets.

        Segment profit.    The Specialty Products Group segment profit was $11.3 million for the quarter ended March 31, 2005, as compared to $13.4 million for the quarter ended March 31, 2004. This $2.1 million decrease is primarily attributable to sales volume decline and increased labor and freight costs.

Industrial Films

        Net sales.    The net sales of our Industrial Films segment increased by $14.5 million, or 24.9%, to $72.8 million for the quarter ended March 31, 2005 from $58.3 million for the quarter ended March 31, 2004. This increase was principally due to an increase in our sales volumes of 4.6% and an increase in our average selling prices of 19.5%, primarily due to the pass through of raw material price increases and increased sales of value added products.

        Segment profit.    The Industrial Films segment profit was $6.4 million for the quarter ended March 31, 2005, as compared to $6.7 million for the same period in 2004. This $0.3 million decrease in

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segment profit was due to increased labor and freight costs associated with volume increases and higher commission costs.

Engineered Films

        Net Sales.    Net sales in Engineered Films increased by $4.2 million, or 7.6%, to $59.6 million for the quarter ended March 31, 2005 from $55.4 million for 2004. This increase was due to an increase in our average selling prices of 14.7%, principally due to the pass-through of raw material price increases and improvements in our sales mix, offset by a 6.2% decrease in sales volume, primarily in our converter films and Canadian markets.

        Segment profit.    The Engineered Films segment profit was $8.1 million for the quarter ended March 31, 2005, as compared to $9.9 million for the same period in 2004. This decrease in segment profit was primarily due to lower gross margins from sales volume declines and compression between our average selling price and average raw material costs related to contractual customers and the competitive environment with customers who are not parties to purchase agreements.

Performance Films

        Net sales.    The net sales of our Performance Films segment decreased $0.8 million, or 3.1%, to $25.0 million for the quarter ended March 31, 2005 from $25.8 million for 2004. This decrease was principally due to a decrease in our sales volumes of 10.8%, primarily in our custom and industrial films markets due to competitive pressures. This volume decrease was partially offset by an increase in our average selling prices of 8.8%, primarily due to the pass through of resin price increases to customers.

        Segment profit.    Performance Films segment profit was $3.6 million for the quarter ended March 31, 2005, as compared to $4.4 million for the same period in 2004. This decrease in segment profit was primarily due to sales volume declines and lower gross margins from compression between our average selling price and average raw material costs to contractual customers.

Corporate/Other

        Corporate/Other includes our corporate headquarters and our research and development facility in Newport News, Virginia. Unallocated corporate expenses increased by $0.7 million to $7.6 million for the quarter ended March 31, 2005, from $6.9 million for the quarter ended March 31, 2004. This increase was primarily due to an increase of $0.5 million in payroll related costs.

Summary of segment information (in millions of dollars) for years ended December 31, 2004, 2003, and 2002:

	Specialty Products Group		Industrial Films		Engineered Films		Performance Films		Corporate/ Other			Total
Year ended December 31, 2004
Net sales	$	390.7	$	254.1	$	219.0	$	98.1	$	6.8		$	968.7
Segment profit (loss)(1)		47.0		26.2		32.2		19.8		(30.6	)		94.6
Year ended December 31, 2003
Net sales	$	367.7	$	219.6	$	196.1	$	105.2	$	5.9		$	894.5
Segment profit (loss)(1)		49.0		27.2		34.1		24.0		(43.1	)		91.2

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Year ended December 31, 2002
Net sales	$	346.6	$	191.4	$	205.4	$	98.6	$	8.9		$	850.9
Segment profit (loss)(1)		55.2		30.5		38.1		23.2		(28.2	)		118.8

(1)

See Note 14 to the consolidated financial statements included elsewhere in this report for a reconciliation of segment profit to income before taxes.

Year ended December 31, 2004 compared to the year ended December 31, 2003

Specialty Products Group

        Net sales.    The net sales of our Specialty Products Group segment increased $23.0 million, or 6.3% to $390.7 million for the year ended December 31, 2004 from $367.7 million for 2003. This increase was primarily due to a 3.8% increase in our sales volumes and a 2.3% increase in our average selling prices.

        Net sales in our Specialty Films division increased $10.7 million, or 6.2%, to $183.8 million for the year ended December 31, 2004 from $173.1 million for 2003. This increase was principally due to an increase in our sales volume of 5.0% and an increase in our average selling price of 1.1%. Net sales in our Printed Products Films division increased $12.4 million, or 6.4%, to $206.9 million for the year ended December 31, 2004 from $194.5 million for 2003. This increase was principally due to an increase in our sales volume of 2.3% and an increase in our average selling prices of 4.0%. We continue to experience market growth in our agricultural product market, along with growth in our printed products with tortilla, bakery and frozen food customers and with new and existing U.S. customers in our personal care and medical products markets, offset by a loss of personal care business in Mexico due to a diaper platform change for major customers.

        Segment profit.    The Specialty Products Group segment profit was $47.0 million for the year ended December 31, 2004, as compared to $49.0 million for the same period in 2003. This $2.0 million decrease was due to an $2.8 million increase in selling, general and administrative costs driven by higher commission costs associated with average sales prices and an accrual of $2.2 million in vacation related payroll costs, offset by reductions in other general and administrative costs.

Industrial Films

        Net sales.    The net sales of our Industrial Films segment increased $34.5 million, or 15.7%, to $254.1 million for the year ended December 31, 2004 from $219.6 million for 2003. This increase was principally due to an increase in our sales volumes of 6.7% and an increase in our average selling prices of 8.4%, primarily due to the pass through of raw material price increases and increased sales of value added products.

        Segment profit.    Industrial Films segment profit was $26.2 million for the year ended December 31, 2004, as compared to $27.2 million for the same period in 2003. This decrease in segment profit was primarily due to lower gross margins from compression between our average selling price and average raw material costs associated with sales to contractual customers and price erosion on sales to one of our more significant international customers. In addition, this segment experienced $0.5 million of start-up costs for new product launch with a major customer and $0.8 million in higher sales commissions and recorded an accrual of $0.6 million in vacation related payroll costs.

Engineered Films

        Net sales.    Net sales in Engineered Films increased $22.9 million, or 11.7%, to $219.0 million for the year ended December 31, 2004 from $196.1 million for 2003. This increase was principally due to

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an increase in our sales volume of 6.7% and an increase in our average selling prices of 4.7% principally due to the pass-through of raw material price increases and improvements in our sales mix. Increased sales activity and focus on major customers resulted in incremental sales volume in our converter, industrial and custom sales markets.

        Segment profit.    Engineered Films segment profit was $32.2 million for the year ended December 31, 2004, as compared to $34.1 million for the same period in 2003. This decrease in segment profit was primarily due to lower gross margins from compression between our average selling price and average raw material costs to contractual customers and the competitive environment with customers who are not parties to purchase agreements. In addition, this segment recorded an accrual of $0.7 million in vacation related payroll costs.

Performance Films

        Net sales.    The net sales of our Performance Films segment decreased $7.1 million, or 6.7%, to $98.1 million for the year ended December 31, 2004 from $105.2 million for 2003. This decrease was principally due to a decrease in our sales volumes of 8.2%, primarily in our custom and barrier films markets due to increased internal manufacturing by customers. This volume decrease was partially offset by an increase in our average selling prices of 1.6%, primarily due to pass through of resin price increases to customers.

        Segment profit.    Performance Films segment profit was $19.8 million for the year ended December 31, 2004, as compared to $24.0 million for the same period in 2003. This decrease in segment profit was primarily due to lower gross margins from compression between our average selling price and average raw material costs to contractual customers.

Corporate/Other

        Corporate/Other includes our corporate headquarters and our research and development facility in Newport News, Virginia. Unallocated corporate expenses decreased $13.6 million to $30.6 million for the year ended December 31, 2004 from $43.0 million for 2003. This decrease was principally due an accrual in 2003 of $7.2 million for the estimated costs of litigation discussed in Note 13 to the consolidated financial statements and to elimination of administrative cost associated with our former international segment and Singapore operations. Unallocated research and development costs increased $2.9 million to $4.2 million.

Year ended December 31, 2003 compared to the year ended December 31, 2002

Specialty Products Group

        Net sales.    The net sales of our Specialty Products Group segment increased $21.1 million, or 6.1% to $367.7 million for the year ended December 31, 2003 from $346.6 million for 2002. This increase was primarily due to a 3.0% increase in our average selling prices, primarily due to the pass-through of raw material price increases, and in increase in sales volumes of 3.0%.

        Net sales in our Specialty Films division increased $25.8 million, or 17.5%, to $173.2 million for the year ended December 31, 2003 from $147.4 million for 2002. This increase was principally due to an increase in our sales volume of 13.0% and an increase in our average selling prices of 3.9%. The increase in sales volume was primarily the result of incremental sales from a new film line at our Washington, GA plant and the transfer of business from our Engineered Films segment. Average selling prices increased due to the pass-through of raw material price increases and improvements in our sales mix.

        Net sales of our Printed Products Film division decreased $4.7 million, or 2.3%, to $194.5 million for the year ended December 31, 2003 from $199.2 million for 2002. This decrease was principally due to a decrease in our sales volumes of 7.7%, partially offset by an increase in our average selling prices of 5.8%.

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        Segment profit.    The Specialty Films segment profit decreased $6.2 million, to $49.0 million for the year ended December 31, 2003 from $55.2 million for 2002. This decrease in segment profit was primarily due to incremental volumes at lower margins and the competitive environment in the personal care business resulted in less than complete recovery of the increase in raw material prices and thus lower margins.

Industrial Films

        Net sales.    Net sales in our Industrial Films segment increased $28.2 million, or 14.7%, to $219.6 million for the year ended December 31, 2003 from $191.4 million for 2002. This increase was principally due to an increase in our average selling prices of 15.4%, principally due to the pass-through of raw material price increases, and offset by a 0.6% decrease in our sales volumes.

        Segment profit.    Industrial Films segment profit decreased $3.3 million, to $27.2 million for the year ended December 31, 2003 from $30.5 million for 2002. This decrease in segment profit was primarily due to lower gross margins resulting from higher waste and packaging costs of $2.1 million, machine start up costs in Germany and our Toronto Facilities and to $1.2 million increases in selling, general and administrative costs related to higher commission expense.

Engineered Films

        Net sales.    Net sales in our Engineered Films segment decreased $9.3 million, or 4.5%, to $196.1 million for the year ended December 31, 2003 from $205.4 million for 2002. This decrease was principally due to a decrease in our sales volume of 13.2%, partially offset by an increase in our average selling prices of 10.0% principally due to the pass-through of raw material price increases. The sales volumes decreased primarily as a result of the slowdown in the economy and the transfer of business to our Specialty Films division. Excluding the transfer of business to the Specialty Films division, sales volume of the Converter Films division decreased 11.0% for the year ended December 31, 2003 as compared to 2002.

        Segment profit.    Engineered Films segment profit decreased $4.0 million, to $34.1 million for the year ended December 31, 2003 from $38.1 million for 2002. This decrease was principally due to the decrease in sales volume, offset in part by increases in our average selling price exceeding increases in our average raw material costs.

Performance Films

        Net sales.    The net sales of our Performance Films segment increased $6.6 million, or 6.7%, to $105.2 million for the year ended December 31, 2003 from $98.6 million for 2002. This increase was principally due to an increase in our sales volumes of 1.3%, and an increase in our average selling prices of 5.4%, largely due to a favorable shift in the mix of higher value added products.

        Segment profit.    Performance Films segment profit increased $0.8 million, to $24.0 million for the year ended December 31, 2003 from $23.2 million for 2003. This increase in segment profit was primarily due to the shift to a more favorable product mix.

Corporate/Other

        Corporate/Other includes our corporate headquarters and research and development facility in Newport, Virginia. Unallocated corporate expenses increased $14.8 million due primarily to an accrual of $7.2 million for the estimated costs of litigation discussed in Note 13 to the consolidated financial statements, $1.1 million of severance costs related to recent organizational changes, and increases in legal and consulting expenses. Unallocated research and development costs increased $0.8 million to $1.3 million.

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Liquidity and Capital Resources

Sources of capital

        Our principal sources of funds are cash generated by our operations and borrowings under our revolving credit facility. In addition, we have raised funds through the issuance of our 13% Senior Subordinated Notes due 2010 (the "2000/2002 Notes"), 11¹/8% Senior Secured Notes due 2009 (the "2003 Notes"), 11¹/8% Senior Secured Discount Notes due 2009 (the "2004 Notes"), and the 11⁵/8% Senior Secured Notes due 2009 (the "Amended 2004 Notes") and the sale of shares of our preferred stock. As of March 31, 2005, our outstanding long-term debt consisted of: $41.4 million of borrowings under our revolving credit facility; $313.4 million of our 2000/2002 Notes; $250.0 million of our 2003 Notes; $6.5 million of our 2004 Notes and $248.0 million of our Amended 2004 Notes.

        All of the term debt and revolver debt under the credit facilities that existed at December 31, 2003 had been at variable rates of interest, so payment of the term loans with the proceeds of our 2004 Notes and borrowings under our revolving credit facility substantially reduced our exposure to interest rate risk. Although our $100 million revolving credit facility is at a variable rate of interest, there are substantially fewer financial covenants than our credit facilities that existed at December 31, 2003, which will substantially reduce our exposure to covenant default risk. While the effective interest rate on the Amended 2004 Notes and the 2004 Notes is higher than the term loans retired from the proceeds of the February 2004 offering, we will realize greater short-term liquidity and flexibility in our debt structure resulting from the elimination of a number of the financial and other covenants in our then existing credit facilities and the deferral of the cash interest requirements of the Amended 2004 Notes and the 2004 Notes.

Revolving credit facility

        On February 17, 2004, we paid off and terminated our then existing credit facilities and entered into a revolving credit facility providing up to $100 million (subject to a borrowing base). The revolving credit facility includes a $15 million letter of credit subfacility, with letters of credit reducing availability under our revolving credit facility.

        The revolving credit facility is secured by a first priority security interest in substantially all inventory, receivables, deposit accounts, 100% of capital stock of, or other equity interests in existing and future domestic subsidiaries and foreign subsidiaries that are guarantors of the Senior Secured Discount Notes, and 65% of the capital stock of, or other equity interests in existing and future first-tier foreign subsidiaries, investment property and certain other assets of the Company and the note guarantors (the "Second Priority Collateral"), and a second priority security interest in our real property, fixtures, equipment, intellectual property and other assets (the "First Priority Collateral").

        The revolving credit facility matures on February 17, 2009. The Company is subject to periodic reporting of a borrowing base consisting of eligible accounts receivable and eligible inventory. The interest rates are at LIBOR plus 2.5% to 3.0% or ABR plus 1.5% - 2.0%.

        The borrowings under the revolving credit facility may be limited to a reduced availability. If the borrowing base is less than $110,000,000 and the Fixed Charge Coverage Ratio (FCCR) is less than 1.1, the reduced availability is the borrowing base minus $10,000,000. Furthermore, if the FCCR is less than that prescribed in our credit agreement, reduced availability is the lessor of the commitment or the borrowing base minus $15,000,000. As of December 31, 2004, we had approximately $60.1 million available for borrowing under our revolving credit agreement.

11⁵/8% Senior Secured Discount Notes Due 2009 (the "Amended 2004 Notes")

        On April 8, 2005, Pliant Corporation commenced a consent solicitation relating to its 11¹/8% Senior Secured Discount Notes due 2009 seeking consents, among other things, to (i) eliminate the current

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requirement to pay cash interest on the notes beginning in 2007 and, in lieu thereof, pay non-cash interest in the form of additional notes through maturity and (ii) increase the interest rate and redemption prices of the notes for which consents are received. On May 6, 2005, the Company consummated this solicitation as consents to the proposed amendments were delivered with respect to $298.2 million aggregate principal amount at maturity of the notes, all of which were accepted by the company.

        As of May 6, 2005, the aggregate principal amount of the amended notes was approximately $250.6 million and equaled their accreted value immediately prior to such consummation. In addition, $7.8 million aggregate principal amount at maturity of notes with respect to which consents were not delivered remain outstanding. The company, certain of its subsidiaries and the trustee also executed an amended and restated indenture governing the amended notes and the notes with respect to which consents were not delivered. The company, certain of its subsidiaries and J.P. Morgan Securities Inc., the solicitation agent for the consent solicitation, executed a registration rights agreement with respect to the amended notes.

        As a result of the amendments approved in the consent solicitation, the interest rate of the Amended 2004 Notes was increased from 11¹/8% per annum to 11⁵/8% per annum. The Amended 2004 Notes no longer require payment of cash interest beginning in 2007. Instead, they require payment of non-cash interest in the form of additional notes through maturity. The amendments also increased the redemption prices of the Amended 2004 Notes. In addition, the amended and restated indenture eliminates substantially all the restrictive covenants contained in the indenture, as they relate to holders of the 2004 Notes with respect to which consents were not delivered. The Amended 2004 Notes will not be registered under the Securities Act of 1933, as amended, or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and any applicable state securities laws.

11¹/8% Senior Secured Discount Notes due 2009 (the "Senior Secured Discount Notes")

        On February 17, 2004 we completed the sale of $306 million principal amount at maturity (gross proceeds of $225.3 million) of 11¹/8% Senior Secured Discount Notes due 2009. The proceeds of the offering and borrowings under the revolving credit facility were used to repay and terminate the credit facilities that existed at December 31, 2003.

        The Senior Secured Discount Notes mature on June 15, 2009, and are secured by a first priority security interest in the First Priority Collateral and a second priority security interest in the Second Priority Collateral. The 2004 Notes are guaranteed by our existing and future domestic restricted subsidiaries and certain foreign subsidiaries.

        Unless we elect to pay cash interest as described below, and except under certain limited circumstances, the Senior Secured Discount Notes will accrete from the date of issuance at the rate of 11¹/8% until December 15, 2006, compounded semiannually on each June 15 and December 15 commencing June 15, 2004, to an aggregate principal amount of $1,000 per note ($7.8 million in the aggregate assuming no redemption or other repayments). Commencing on December 15, 2006, interest on the Senior Secured Discount Notes will accrue at the rate of 11¹/8% per annum and will be payable in cash semiannually on June 15 and December 15, commencing on June 15, 2007.

        On any interest payment date prior to December 15, 2006, we may elect to commence paying cash interest (from and after such interest payment date) in which case (i) we will be obligated to pay cash interest on each subsequent interest payment date, (ii) the notes will cease to accrete after such interest payment date and (iii) the outstanding principal amount at the stated maturity of each note will equal the accreted value of such note as of such interest payment date.

        On or after June 15, 2007, we may redeem some of all of the Senior Secured Discount Notes at the following redemption prices (expressed as a percentage of principal amount), plus accrued and

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unpaid interest: 105.563% if redeemed prior to June 15, 2008; 102.781% if redeemed prior to June 15, 2009; and 100% if redeemed on or after June 15, 2009. Prior to such date, we may not redeem the notes except as described in the following paragraph.

        At any time prior to June 15, 2007, we may redeem up to 35% of the accreted value of the 2004 Notes with the net cash proceeds of certain equity offerings by us at a redemption price equal to 111.125% of the accreted value thereof plus accrued interest, so long as (i) at least 65% of the accreted value of the notes remains outstanding after such redemption and (ii) any such redemption by us is made within 120 days after such equity offering.

11¹/8% Senior Secured Notes due 2009 (the "2003 Notes")

        On May 30, 2003, we completed the sale of $250 million aggregate principal amount of our 11¹/8% Senior Secured Notes due 2009. The 2003 Notes mature on September 1, 2009, and interest is payable on March 1 and September 1 of each year. The net proceeds from the sale of the 2003 Notes were used to repay borrowings under our then existing credit facilities in accordance with an amendment to our then existing credit facilities. The 2003 Notes rank equally with our existing and future senior debt and rank senior to our existing and future subordinated indebtedness, including the 2000/2002 Notes. The 2003 Notes are secured by a first priority security interest in the First Priority Collateral and a second priority security interest in the Second Priority Collateral. The 2003 Notes are guaranteed by some of our subsidiaries.

        Prior to June 1, 2007, we may, on one or more occasions, redeem up to a maximum of 35% of the original aggregate principal amount of the 2003 Notes with the net cash proceeds of one or more equity offerings by us at a redemption price equal to 111.125% of the principal amount thereof, plus accrued and unpaid interest. Otherwise, we may not redeem the 2003 Notes prior to June 1, 2007. On or after that date, we may redeem some or all of the 2003 Notes at the following redemption prices (expressed as a percentage of principal amount), plus accrued and unpaid interest: 105.563% if redeemed prior to June 1, 2008; 102.781% if redeemed prior to June 1, 2009; and 100% if redeemed on or after June 1, 2009.

13% Senior Subordinated Notes due 2010 (the "2000/2002 Notes")

        In 2000, we issued $220 million aggregate principal amount of 13% Senior Subordinated Notes due 2010. In 2002, we issued an additional $100 million of 13% Senior Subordinated Notes due 2010. The 2000/2002 Notes mature on June 1, 2010, and interest on the 2000/2002 Notes is payable on June 1 and December 1 of each year. The 2000/2002 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 2000/2002 Notes are guaranteed by some of our subsidiaries. The 2000/2002 Notes are unsecured. Prior to June 1, 2003, we may, on one or more occasions, redeem up to a maximum of 35% of the original principal amount of the 2000/2002 Notes with the net cash proceeds of one or more equity offerings by us at a redemption price equal to 113% of the principal amount thereof, plus accrued and unpaid interest. Otherwise, we may not redeem the 2000/2002 Notes prior to June 1, 2005. On or after that date, we may redeem the 2000/2002 Notes, in whole or in part, at the following redemption prices (expressed as percentages of principal amount), plus accrued and unpaid interest: 106.5% if redeemed prior to June 1, 2006; 104.333% if redeemed prior to June 1, 2007; 102.167% if redeemed prior to June 1, 2008; and 100% if redeemed on or after June 1, 2008.

Preferred stock

        As of March 31, 2005, we had approximately $232.9 million of Series A Cumulative Exchangeable Redeemable Preferred Stock outstanding. The Series A preferred stock accrues dividends at the rate of 14% per annum; however, our board of directors has never declared or paid any dividends on the Series A preferred stock. Unpaid dividends accumulate and are added to the liquidation amount of the

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Series A preferred stock. As of May 31, 2005 the annual dividend rate increased to 16% unless we pay dividends in cash. The Series A preferred stock is mandatorily redeemable on June 1, 2011. See Note 10 to the consolidated financial statements included elsewhere in this report. The shares of Series A Preferred Stock are non-voting.

        On September 24, 2004, we adopted a 2004 Restricted Stock Incentive Plan, pursuant to which we sold to our President and Chief Executive Officer and selected additional officers of the Company, 704 shares of a total of 720 shares of a newly-created, non-voting Series B Redeemable Preferred Stock for a cash purchase price of $162 per share. These shares were issued in private transactions with officers of the Company and therefore were exempt from the registration requirements of the Securities Act of 1933. On December 22, 2004, the remaining 16 authorized shares were issued to an officer for a cash purchase price of $162 per share.

        Upon the sale of all or substantially all of the Company's assets, sale of the majority of the outstanding Common Stock of the Company to a person other than J.P. Morgan or its affiliates; merger or consolidation of the Company, or the consummation of a liquidation, as those events are specifically described in the Company's Articles of Incorporation, we are required to redeem all shares of Series B Redeemable Preferred Stock by payment of cash in an amount equal to the product of (x) .000104166; times (y) the sum of the amount of cash distributions actually paid and the fair market value of assets distributed by the Company to its stockholders during the period commencing on September 24, 2004 through the date of such event, plus the net proceeds payable, whether in cash, stock or other assets, to the stockholders of the Company in respect of such event.

        Upon a redemption by the Company of any shares of Series A Preferred Stock (or any payment on any notes issued in exchange therefor), the holder of each share of Series B Redeemable Preferred Stock shall be entitled to receive a cash dividend equal to the product of (x) .000104166; times (y) the net proceeds payable, whether in cash, stock or other assets, to the stockholders of the Company in respect to such redemption or such payment.

        Upon an underwritten public offering of shares of capital stock of the Company to the public resulting in aggregate net proceeds to the Company of not less than $100 million each share of Series B Redeemable Preferred Stock shall be automatically converted into that number of shares of the class of common equity securities of the Company that are outstanding immediately following such public offering equal to the product of (x) .000104166; times (y) the total number of shares of such class of stock outstanding immediately following the consummation of the public offering. The shares of Series B Redeemable Preferred Stock are non-voting and do not bear dividends except as noted above.

Net cash used in operating activities

        Net cash used in operating activities was $7.4 million for the three months ended March 31, 2005, a decrease of $7.8 million, compared to net cash provided by operating activities of $0.4 million for the same period in 2004. This increase was due primarily to reductions in working capital items of $5.8 million.

        Net cash used in operating activities was $1.4 million for the year ended December 31, 2004, compared to net cash used in operations of $14.2 million for the same period in 2003, a difference of $12.8 million. This difference is primarily attributable to the recognition of $35.3 million in deferred dividends, accretion on the Series A preferred stock and $23.5 million of accretion on the senior secured discount notes, offset by reductions in goodwill and fixed asset impairments of $18.3 million and $4.4 million, respectively, $12.7 million in increased working capital requirements, $7.0 million in less losses from discontinued operations and $6.2 million less depreciation and amortization.

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Net cash used in investing activities

        Net cash used in investing activities increased $5.5 million to $8.6 million for the three months ended March 31, 2005, from $3.1 million for the three months ended March 31, 2004 primarily due to an increase in capital expenditures of $5.9 million.

        Net cash used in investing activities was $17.6 million for the year ended December 31, 2004, as compared to $17.0 million for the same period in 2003. Capital expenditures in 2004 of $24.1 million included $8.7 million for new production lines, while capital expenditures in 2003 were principally for upgrading the operating efficiencies at our manufacturing facilities. In addition, during the third quarter of 2004, the Company sold substantially all the assets of our wholly-owned subsidiary, Pliant Solutions, receiving $6.5 million in cash proceeds.

Net cash provided by financing activities

        Net cash provided by financing activities was $16.2 million for the three months ended March 31, 2005, compared to net cash provided by financing activities of $4.9 million for the three months ended March 31, 2004. The activity for the first three months of 2005 include borrowings under the revolving credit facility of $17.4 million, offset by payments of $0.1 million in financing fees and $1.1 million repayments of capital lease and insurance financing. The activity for the first three months of 2004 includes the net proceeds from the issuance of senior secured discount notes of $225.3 million net of financing fees paid of $8.7 million, the repayment of the old credit facilities of $219.6 million and repayment of capital leases and insurance financing of $0.5 million.

        Net cash provided by financing activities was $25.5 million for the year ended December 31, 2004, as compared to net cash provided by financing activities of $46.0 million for the year ended December 31, 2003. As a condition to the effectiveness of the March 2003 amendment to our then existing credit facilities, J.P. Morgan Partners agreed to purchase Series A preferred stock and warrants for $10 million. The activity for 2003 includes the net proceeds from the issuance of such $10 million of Series A preferred stock and warrants, the net proceeds from the issuance of $250 million principal amount of Senior Secured Notes in May 2003, and the use of these proceeds to repay term debt. In addition, we paid $10.5 million in financing fees for a related amendment to our then existing credit facilities and the issuance of the Series A preferred stock and warrants. The activity for both periods also includes scheduled principal payments on our term loans and borrowings and repayments under our then existing revolving credit facility.

Liquidity

        As of March 31, 2005, we had $90.1 million of working capital, excluding current maturities of long term debt. As of March 31, 2005, we had $49.7 million available for borrowings under our revolving credit facility, with $41.4 million of outstanding borrowings under this agreement and approximately $6.7 million of letters of credit issued under our revolving credit facility. Daily borrowings outstanding under the revolving credit facility averaged $32.6 million during the first quarter. Our outstanding borrowings under our revolving credit facility fluctuate significantly during each quarter as a result of the timing of payments for raw materials, capital and interest, as well as the timing of customer collections.

        As of March 31, 2005, we had approximately $4.1 million in cash and cash equivalents. A portion of this amount was held by our foreign subsidiaries. Repatriation tax rates may limit our ability to access cash and cash equivalents generated by our foreign operations for use in our U.S. operations, including to pay principal and interest on outstanding borrowings.

        We expect that our total capital expenditures will be approximately $35 million in each of 2005 and 2006. These expenditures will consist primarily of ongoing capital expenditures for operating improvements and limited capacity additions.

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        As of December 31, 2004, we had approximately $78.5 million of working capital, approximately $60.1 million available for borrowings under our then existing revolving credit facility, with no outstanding borrowings under that facility, and approximately $6.7 million in letters of credit issued under our then existing revolving credit facility. Our outstanding borrowings under our then existing revolving credit facility fluctuated significantly during each quarter as a result of the timing of payments for raw materials, capital and interest, as well as the timing of customer collections. See "Sources of Capital" above for a discussion of the refinancing done in February 2004.

        As of December 31, 2004, we had approximately $5.6 million in cash and cash equivalents. A portion of this amount was held by our foreign subsidiaries. Repatriation tax rates may limit our ability to access cash and cash equivalents generated by our foreign operations for use in our U.S. operations, including to pay principal and interest on outstanding borrowings.

        Our total capital expenditures in 2004, 2003 and 2002 were approximately $24.1 million, $17.0 million, and $49.2 million, respectively.

        Although our outstanding preferred stock accrues dividends, these dividends are only paid if declared. We do not expect to pay any dividends on our preferred stock for the foreseeable future.

        The interest expense and scheduled principal payments on our borrowings also affect our future liquidity requirements. We expect that cash flows from operating activities and available borrowings under our revolving credit facility of up to $100 million (excluding $6.7 million of outstanding letters of credit) will provide sufficient cash flow to operate our business, to make expected capital expenditures and to meet foreseeable liquidity requirements.

        Our revolving credit facility and the indentures relating to our outstanding 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 an attempt to manage our liquidity needs, we and our affiliates are analyzing and formulating potential strategic alternatives to reduce our leverage. In this regard, we or our affiliates may repurchase all or a portion of our Notes, through an exchange offer, a tender offer or open-market or privately-negotiated purchases, or through a combination of any of these or other alternatives. The funds for any such repurchases may be raised by selling additional equity, seeking additional capital contributions from our existing equity holders or by other means. There can be no assurance that any plan to reduce our indebtedness, if commenced, would be successfully completed.

        Based on our current level of operations, we believe that cash flow from operations and available cash, together with available borrowings under our revolving credit facility, will be adequate to meet liquidity needs and fund planned capital expenditures for the next 12 months.

        However, our ability to borrow under our revolving credit facility at any time will be subject to the borrowing base in effect at that time (which will vary depending upon the value of our accounts receivable and inventory). Our ability to make borrowings under our revolving credit facility will also be conditioned upon our compliance with other covenants in the credit agreement, including financial covenants that apply when our borrowings exceed certain amounts. In addition, the terms of our indentures currently limit the amount we may borrow under our revolving credit facility.

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        Changes in raw material costs can significantly affect the amount of cash provided by our operating activities, which can affect our liquidity. Over the past several months, we have experienced a period of extreme uncertainty with respect to resin supplies and prices. High crude oil and natural gas pricing, have had a significant impact on the price and supply of resins. During the same period, many major suppliers of resin have announced price increases to cover their increases in feedstock costs. While the prices of our products generally fluctuate with the prices of resins, certain of our customers have contracts that limit our ability to pass the full cost of higher resin pricing through to our customers immediately. Further, competitive conditions in our industry may make it difficult for us to sufficiently increase our selling prices for all customers to reflect the full impact of increases in raw material costs. If this period of high resin pricing continues, we may be unable to pass on the entire effect of the price increases to our customers, which would adversely affect our profitability and working capital. In addition, further increases in crude oil and natural gas prices could make it difficult for us to obtain an adequate supply of resin from manufacturers affected by these factors.

        If (a) we are not able to increase prices to cover historical and future raw materials cost increases, (b) we are unable to obtain adequate supply of resin, (c) volume growth does not continue as expected, or (d) we experience any significant negative effects to our business, we may not have sufficient cash flow to operate our business, make expected capital expenditures or meet foreseeable liquidity requirements. In that event, we would have to seek modifications to our credit agreements, raise other debt or equity capital, sell assets, or take other steps to create additional working capital. There is no assurance, however, that these efforts would be successful and, if they were not, these working capital limitations could constrain the scope of our business operations and have a significant negative effect on our business and results of operations.

        Further, we may need to refinance all or a portion of the principal amount of our long-term debt and/or revolving credit facility borrowings, on or prior to maturity, to meet liquidity needs in later years. If it is determined that refinancing is necessary, and we are unable to secure such financing on acceptable terms, we may have insufficient liquidity to carry on our operations and meet our obligations at such time.

        The following table sets forth our total contractual cash obligations excluding cash interest payments, as of December 31, 2004 (in thousands):

	Payments Due by Period
Contractual Cash Obligations	Total		Less than 1 year		1-3 years		4-5 years		After 5 years
Long-term debt (including capital lease obligations)	$	842,348	$	1,994	$	2,376	$	524,764	$	313,214
Operating leases		43,196		9,190		15,153		7,997		10,856
Redeemable preferred stock		223,548		—		—		—		223,548
Pension obligations		3,067		3,067		—		—		—
Raw material and other purchase obligations		32,796		28,550		4,246		—		—
Total contractual cash obligations	$	1,144,955	$	42,801	$	21,775	$	532,761	$	547,618

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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 regularly evaluate the advisability of entering into interest rate hedging agreements to manage interest rate market risks and commodity hedging agreements to manage resin market risks. However, 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.

        Since the repayment of $219.6 million of variable rate term debt with the proceeds of our Senior Secured Discount Notes and borrowings under our revolving credit facility on February 17, 2004, our interest rate risk has decreased substantially.

        Our revolving credit facility is at a variable rate of interest. An increase of 1% in interest rates would result in an additional $100,000 of annual interest expense for each $10.0 million in borrowings under our revolving credit facility. We will thus be exposed to interest rate risk to the extent of our borrowings under the revolving credit facility.

        Our raw material costs are comprised primarily of resins. For the year ended December 31, 2004 and the three months ended March 31, 2005, resin costs comprised approximately 61% and 59%, respectively of our total manufacturing costs in 2004. Market risk arises from changes in resin costs. Although the average selling prices of our products generally increase or decrease as the cost of resins increases or decreases, the impact of a change in resin prices is more immediately reflected in our raw material costs than in our selling prices. From time to time we enter into commodity collar agreements to manage resin market risks. At March 31, 2005, we did not have any commodity collar agreements outstanding. Prices for resin have risen dramatically over the last year and could continue to rise in the second quarter of 2005 and beyond. Pliant's costs for resin on a weighted-average basis rose 29% higher from December of 2003 to December of 2004, with over half of that increase occurring in the fourth quarter of 2004.

        Fluctuations in exchange rates may also adversely affect our financial results. The functional currencies for our foreign subsidiaries are the local currency. As a result, certain of our assets and liabilities, including certain bank accounts, accounts receivable and accounts payable, exist in non U.S. dollar-denominated currencies, which are sensitive to foreign currency exchange rate fluctuations.

        We enter into certain transactions denominated in foreign currencies and when advisable we have employed hedging techniques designed to mitigate foreign currency exposures. Gains and losses from these transactions as of March 31, 2005, have been immaterial and are reflected in the results of operations.

        We are exposed to credit losses in the event of nonperformance by the counterparty to a financial instrument to which we are a party. We anticipate, however, that each of the counterparties to the financial instruments to which we are a party will be able to fully satisfy its obligations under the contract.

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BUSINESS

General

        Pliant Corporation ("Pliant," the "Company," "we" or "us"), with 2004 revenues of approximately $968.7 million, is one of North America's leading manufacturers of value-added films and flexible packaging for food, personal care, medical, agricultural and industrial applications. We offer some of the most diverse product lines in the film industry and have achieved leading positions in many of these product lines. We operate 24 manufacturing and research and development facilities worldwide and we currently have approximately 1.0 billion pounds of annual production capacity.

        Pliant has a proud heritage that traces back many decades. We have combined strategic acquisitions, internal growth, product innovation and operational improvements to grow our business from net sales of $310.8 million in 1996 to $968.7 million in 2004. We have invested heavily to expand our capabilities and value-added product offerings for our customers. Between January 1, 2000 and December 31, 2004, we invested a total of $212.3 million to expand, upgrade and maintain our asset base and information systems.

Recapitalization

        On May 31, 2000, we consummated a recapitalization pursuant to an agreement dated March 31, 2000 among us, our then existing stockholders and an affiliate of J.P. Morgan Partners, LLC, whereby the affiliate acquired majority control of our common stock. The total consideration paid in the recapitalization was approximately $1.1 billion, including transaction costs. 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;



•

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 and by members of our current and former senior management;



•

an affiliate of J.P. Morgan Partners, LLC and certain other institutional investors purchased shares of common stock directly from us;



•

the trust and the management investors at that time retained or "rolled-over" approximately one-half of the shares of our common stock collectively owned by them prior to the recapitalization; and



•

we issued to an affiliate of J.P. Morgan Partners, LLC and to certain other institutional investors a new series of senior cumulative exchangeable redeemable preferred stock and detachable warrants for our common stock.

Controlling Shareholders

        As of June 10, 2005, J.P. Morgan Partners (BHCA), L.P. and/or affiliates owned approximately 55% of our outstanding common stock, 74% of our detachable warrants to purchase common stock issued in connection with our Series A preferred stock and 59% of our outstanding Series A preferred stock. J.P. Morgan Partners, LLC serves as investment advisor to J.P. Morgan Partners (BHCA), L.P. J.P. Morgan Partners, LLC is the private equity group of J.P. Morgan Chase & Co., which is one of the largest financial holding companies in the United States. J.P. Morgan Partners, LLC is a global partnership, with approximately $21 billion in capital under management as of December 31, 2004. It is a leading provider of equity capital for middle market buyouts, growth equity and venture capital and has closed over 1,300 individual transactions since its inception in 1984. (See "Risk Factors")

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        On March 1, 2005, JPMorgan Chase & Co. announced that J.P. Morgan Partners, LLC will become independent when it completes the investment of its current $6.5 billion Global Fund and that the independent unit will retain portfolio management responsibility for the Global Fund and heritage investments of affiliates of J.P. Morgan Partners, LLC. However, at this time the Company has no additional information as to the impact, if any, that J.P. Morgan Partners, LLC becoming independent of JPMorgan Chase & Co. may have on the Company or its investments in the Company.

Recent Developments

Senior management changes

        In October 2003, Harold C. Bevis was appointed as our President and Chief Executive Officer and was elected to our Board of Directors. Edward A. Lapekas, who had served as our interim Chief Executive Officer since the August 24, 2003 termination of Jack E. Knott II, was named the Non-Executive Chairman of our Board of Directors. We entered into a consulting agreement with Mr. Lapekas in 2003. In November 2003, R. David Corey was named our Executive Vice President of Global Operations and was promoted to Executive Vice President and Chief Operating Officer in March 2004. Brian Johnson, who served as Chief Financial Officer of the Company beginning in July 2001, resigned as Executive Vice President and Chief Financial Officer of the Company in May 2004, although he continued to be employed as a non-executive officer of the Company until December 31, 2004. In September 2004, James Ide was hired as the Chief Financial Officer of the Company, a position from which he resigned effective January 26, 2005. Since that time, Mr. Bevis has served as the acting Chief Financial Officer of the Company. In May 2004, Lori Roberts was hired as Senior Vice President, Human Resources, a position from which she resigned effective March 18, 2005. Since that time, Mr. Corey has served as the acting director of Human Resources of the Company. Mr. Bevis has established a flatter and simpler organization for Pliant going forward by eliminating several layers of management which will not be replaced. Mr. Bevis has also installed the Pliant Leadership Team which will consist of a broad group of leaders from throughout the organization. This team meets on a monthly basis to review and discuss our business so that the management can make better informed and quicker decisions.

11⁵/8% Senior Secured Notes Due 2009 (the "Amended 2004 Notes")

        On April 8, 2005, Pliant Corporation commenced a consent solicitation relating to its Senior Secured Discount Notes seeking consents, among other things, to (i) eliminate the current requirement to pay cash interest on the notes beginning in 2007 and, in lieu thereof, pay non-cash interest in the form of additional notes through maturity and (ii) increase the interest rate and redemption prices of the notes for which consents are received. On May 6, 2005, Pliant consummated this solicitation as consents to the proposed amendments were delivered with respect to $298.2 million aggregate principal amount at maturity of the notes, all of which were accepted by Pliant.

        As of May 6, 2005, the aggregate principal amount of the Amended 2004 Notes was approximately $250.6 million and equaled their accreted value immediately prior to such consummation. In addition, $7.8 million aggregate principal amount at maturity of Senior Secured Discount with respect to which consents were not delivered remain outstanding. Pliant, certain of its subsidiaries and the trustee also executed an amended and restated indenture governing the Amended 2004 Notes and the Senior Secured Discount Notes with respect to which consents were not delivered. Pliant, certain of its subsidiaries and J.P. Morgan Securities Inc., the solicitation agent for the consent solicitation, executed a registration rights agreement with respect to the Amended 2004 Notes.

        As a result of the amendments approved in the consent solicitation, the interest rate of the Amended 2004 Notes was increased from 11¹/8% per annum to 11⁵/8% per annum. The Amended 2004 Notes no longer require payment of cash interest beginning in 2007. Instead, they require payment of

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non-cash interest in the form of additional notes through maturity. The amendments also increased the redemption prices of the amended notes. In addition, the amended and restated indenture eliminates substantially all the restrictive covenants contained in the indenture, as they relate to holders of the Senior Secured Discount Notes with respect to which consents were not delivered. The transaction in which the terms of the Senior Secured Discount Notes were amended to become the Amended 2004 Notes was not registered under the Securities Act of 1933, as amended, or any state securities laws and the Amended 2004 Notes may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and any applicable state securities laws. Pursuant to a registration rights agreement Pliant agreed to consummate an exchange offer for the Amended 2004 Notes in which the company will issue up to $298,200,000 aggregate principal amount at maturity of 11⁵/8% Senior Secured Notes due 2009 which will be registered under the Securities Act of 1933, as amended, in exchange for the existing Amended 2004 Notes.

Sale of Senior Secured Discount Notes

        On February 17, 2004, we completed the sale of $306,000,000 in aggregate principal amount at maturity of 11¹/8% Senior Secured Discount Notes due 2009. The net proceeds from such sale in the amount of $220.2 million (after deducting underwriters' fees) together with borrowings of $30.0 million under our revolving credit facility described below, were used to pay off our then existing term loan facilities in the amount of $219.6 million and our then existing revolving credit facility in the amount of $20 million and $3.8 million in fees and other costs, leaving $6.8 million of cash on hand. The Senior Secured Discount Notes are secured by a first-priority security interest in the First-Priority Collateral, consisting of substantially all of the real property, fixtures, equipment, intellectual property and all other assets, other than the Second-Priority Collateral described below, of us and those of our subsidiaries that guarantee the notes, and a second-priority security interest in the Second-Priority Collateral, consisting of substantially all of the inventory, receivables, deposit accounts, 100% of the capital stock of, or other equity interests in, existing and future domestic subsidiaries and foreign subsidiaries that are note guarantors, and 65% of the capital stock of, or other equity interests in, existing and future first-tier foreign subsidiaries (other than foreign subsidiaries that are note guarantors), investment property and certain other assets of the Company and the note guarantors.

Revolving credit facility

        On February 17, 2004, we terminated our then existing credit facilities and entered into a revolving credit facility in the principal amount of up to $100 million. See "Description of credit facilities and other indebtedness—Revolving credit facility." The revolving credit facility is secured on a first-priority basis by the Second-Priority Collateral and is secured on a second-priority basis by the First-Priority Collateral. All of the term debt and revolver under the credit facilities that existed at December 31, 2003 had been at variable rates of interest, so payment of the term loans with the proceeds of our Senior Secured Discount Notes and borrowings under our revolving credit facility substantially reduced our exposure to interest rate risk. Although our $100 million revolving credit facility is at a variable rate of interest, there are substantially fewer financial covenants than our credit facilities that existed at December 31, 2003, which substantially reduces our exposure to covenant default risk. While the effective interest rate on the Senior Secured Discount Notes and the Amended 2004 Notes is higher than the term loans retired from the proceeds of the February 2004 offering, we will realize greater short-term liquidity and flexibility in our debt structure resulting from the elimination of a number of the financial and other covenants in our then existing credit facilities and the deferral of cash interest requirements during the period in which the Senior Secured Discount Notes and the Amended 2004 Notes accrete.

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11¹/8% Senior Secured Notes due 2009 (the "2003 Notes")

        In 2003, Pliant Corporation registered an exchange offer for $250,000,000 aggregate principal amount of its 11¹/8% Senior Secured Notes due 2009, which we sometimes refer to as the 2003 Notes.

        The 2003 Notes are senior secured obligations, rank equally in right of payment to all existing and future senior indebtedness, are secured on a second-priority basis by substantially all of our assets and the assets of our note guarantors, are structurally subordinated to our revolving credit facility, our Senior Secured Discount Notes and our Amended 2004 Notes to the extent of the value of the collateral securing our revolving credit facility and those notes on a first-priority basis, and rank senior in right of payment with all existing and future subordinated obligations.

13% Senior Secured Notes due 2010 (the "2000/2002 Notes")

        In 2000, Pliant Corporation registered an exchange offer for $220,000,000 aggregate principal amount of its 13% Senior Subordinated Notes due 2010 and in 2002, Pliant Corporation registered an exchange offer for an additional $100,000,000 aggregate principal amount of its 13% Senior Subordinated Notes due 2010. We sometimes refer to the $320,000,000 aggregate principal amount of 13% Senior Subordinated Notes due 2010 as the 2000/2002 Notes. The 2000/2002 Notes are unsecured and subordinated to all of our existing and future senior debt, rank equally with all of our future senior subordinated debt and rank senior to all of our future subordinated debt.

Sale of Pliant Solutions and Reorganization of Company Operations

        On September 30, 2004, we sold substantially all of the assets of our wholly-owned subsidiary, Pliant Solutions Corporation for a total consideration of $9 million. We acquired Pliant Solutions Corporation from Décora in 2002. Pliant Solutions Corporation, previously reported as a separate operating segment during the first three quarters of the 2004 fiscal year, manufactured decorative and surface coverings through the conversion of various films into consumer packaged goods. The Pliant Solutions operating segment had net sales for the nine months ended September 30, 2004 of $22.5 million; net sales for the twelve months ended December 31, 2003 of $34.9 million; and net sales for the eight months ended December 31, 2002 of $28.3 million. As a result of our sale of Pliant Solutions Corporation, during the fourth quarter of 2004, we reorganized our operations under four operating segments: Specialty Products Group, Industrial Films, Engineered Films and Performance Films.

Adoption of 2004 Incentive Plans and Issuance of Series B Preferred Stock

        Effective January 1, 2004, our Board of Directors adopted two new benefit plans in which some or all of our named executive officers may participate: the 2004 Management Incentive Compensation Plan and the 2004 MIP Long Term Incentive Plan. The participants in the 2004 Management Incentive Compensation Plan were paid cash bonuses relating to achievement of certain EBITDA and operating free cash flow goals for 2004. In addition, participants in the 2004 MIP Long Term Incentive Plan, which includes all officers and other key management personnel of the Company (except the Chief Executive Officer), received a credit of half of the 2004 bonus amount to the accumulated amount of their Long Term Incentive Plan Award that they can earn under the 2004 MIP Long Term Incentive Plan, which will become payable on December 31, 2007 under the terms of that plan to eligible employees who are then employed by the Company and who have satisfied certain other conditions as set forth in the plan. (See "Executive Compensation")

        In August 2004, our Board of Directors adopted the 2004 Restricted Stock Incentive Plan. Since the adoption of the 2004 Restricted Stock Incentive Plan, we sold 720 shares of a newly created Series B Preferred Stock to our Chief Executive Officer and certain other officers in a private transaction at $162 per share, which was determined to be the fair market value of those shares based

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on an independent appraisal received by the Board. On February 14, 2005, 48 shares of non-voting Series B Redeemable Preferred Stock were repurchased from an officer for $162 per share.

Termination of Alliant Joint Venture

        On January 5, 2005, we terminated our joint venture with Supreme Plastics Group PLC by purchasing all of the equity interests in the joint venture Supreme Plastics Group PLC owned for $400,000. As of January 5, 2005, Alliant Company LLC became a wholly-owned subsidiary of the Company. On April 13, 2005, Pliant Corporation sold the intellectual property, working capital, and equipment assets used in the Alliant operation to an independent third party for a purchase price of $6.3 million, subject to certain adjustments with $4.6 million paid in cash at closing, $0.6 million paid 10 days after closing and $0.5 million to be paid within 70 days of closing. The remaining purchase price of $0.63 million will be paid in equal installments twelve and twenty-four months after closing. Net sales and net loss for the three months ended March 31, 2005 were $0.6 million and $0.3 million, respectively.

Industry Overview

        We manufacture and sell a variety of plastic films and flexible packaging products. The plastic film industry serves a variety of flexible packaging markets, including the pharmaceutical, medical, personal care, household, industrial and agricultural film markets, as well as secondary packaging and non-packaging end use markets. According to the Flexible Packaging Association, the North American market for flexible packaging was approximately $21.3 billion in 2004 and has grown at a compound annual growth rate, or CAGR, of approximately 3.9% from 1994-2004. Many of our plastic films are flexible packaging products as defined by the Flexible Packaging Association. However, the flexible packaging market, as defined by the Flexible Packaging Association, does not include certain of the products we sell, such as agricultural films, and includes certain products we do not sell, such as wax papers and aluminum foils. We believe, however, that trends affecting the flexible packaging industry also affect the markets for many of our other products.

        Flexible packaging is used to package a variety of products, particularly food, which accounts for approximately half of all flexible packaging shipments. Recent advancements in film extrusion and resin technology have produced new, sophisticated films that are thinner and stronger and have better barrier and sealant properties than other materials or predecessor films. These technological advances have facilitated the replacement of many traditional forms of rigid packaging with film-based, flexible packaging that is lighter, is lower in cost and has enhanced performance characteristics. For example, in consumer applications, stand-up pouches that use plastic films are now often used instead of paperboard boxes, glass jars and metal cans. In industrial markets, stretch and shrink films are often used instead of corrugated boxes and metal strapping to unitize, bundle and protect items during shipping and storage.

        Except as otherwise indicated, all industry and market share data reported herein is based on estimates made by the Flexible Packaging Association in a "State of the Industry Report 2005," which was compiled based on data compiled from surveys submitted by its members beginning in December of 2004, or from data provided by the Flexible Packaging Association in an investment bank report titled "Paper and Packaging: Industry Overview and Outlook" issued in December 2003. Mr. Bevis serves on the Board of Directors of the Flexible Packaging Association and Pliant is a dues-paying member of the Flexible Packaging Association. Unless otherwise indicated, the market share and industry data used throughout this report were obtained primarily from internal company surveys and management estimates based on these surveys and our management's knowledge of the industry. We have not independently verified any of the data from third-party sources. Similarly, internal company surveys and management estimates, while we believe them to be reliable, have not been verified by any independent sources. While we are not aware of any misstatements regarding our industry data

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presented herein, our estimates involve risks and uncertainties and are subject to change based on various factors, including those discussed in "Cautionary Statement for Forward-Looking Information."

Products, Markets and Customers

        Our products are sold into numerous markets for a wide variety of end uses and are offered through four operating segments: Specialty Products Group, Industrial Films, Engineered Films, and Performance Films. Operating segments are components of our business 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. In previous reporting periods, we had four operating segments: Pliant U.S., Pliant International, Pliant Flexible Packaging and Pliant Solutions. During the third quarter of 2004, we sold Pliant Solutions and reorganized our operations under our four current operating segments: Specialty Products Group, Industrial Films, Engineered Films and Performance Films. Segment information in this report with respect to 2003 and 2002 has been restated for comparative purposes. For more information on our operating segments and geographic information, see Note 14 to the consolidated financial statements included elsewhere in this report.

Specialty Products Group

        The Specialty Products Group includes our Specialty Films and Printed Products Films divisions and accounted for 40.3%, 41.1% and 40.7% of our consolidated net sales in 2004, 2003 and 2002, respectively and 39.1% and 40.6% of our consolidated net sales on March 31, 2005 and 2004, respectively. Our Specialty Films division produces personal care films, medical films, and agricultural films.

        Personal Care.    We are a leading producer of personal care films used in disposable diapers, feminine care products and adult incontinence products. Personal care films must meet diverse and highly technical specifications. Many of these films must "breathe," allowing water vapors to escape. In some applications, the softness or "quietness" of the film is important, as in adult incontinence products. We are one of North America's leading producers of personal care films, with an estimated market share of approximately 35% in 2003 based on sales dollars.

        Medical.    We are a specialized niche manufacturer of medical films. Our medical films are used in disposable surgical drapes and gowns. We also produce protective packaging for medical supplies, such as disposable syringes and intravenous fluid bags. In addition, our products include packaging for disposable medical devices. Our medical films are manufactured in "clean-room" environments and must meet stringent barrier requirements. A sterile barrier is necessary to provide and assure the integrity of the devices and to prevent contamination and tampering. These films must also be able to withstand varied sterilization processes.

        Agricultural.    We are a leading manufacturer of polyethylene mulch films that are sold to fruit and vegetable growers and to nursery operators. Our mulch films are used extensively in North America and Latin America. Commercial growers of crops like peppers, tomatoes, cucumbers and strawberries are the primary consumers of our mulch films. These crops are typically planted on raised beds that are tightly covered with mulch film. The mulch film eliminates or retards weed growth, significantly reduces the amount of water required by plants, controls soil bed temperatures for ideal growing conditions and allows easy application of fertilizer. We are one of North America's two largest producers of mulch films, with an estimated market share of approximately 31%.

        Our Printed Products Films division provides printed rollstock, bags and sheets used to package food and consumer goods. Printed bags or rollstock are sold to bakeries, fresh and frozen food processors, manufacturers of personal care products, textile manufacturers and other dry goods processors. Bread and bakery bags represent a significant portion of our Printed Products Films

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business. Our Printed Products Films division produces approximately four billion bread and bakery bags each year, with an estimated share of 20% of the North American market.

        The Specialty Products Group also includes our Mexican subsidiary, Pliant de Mexico S.A. de C.V., which produces printed products for Mexico and other Latin American countries. Pliant de Mexico S.A. de C.V. also produces personal care and barrier films for these markets. In 2004, management estimates that approximately 10% of our Printed Products sales were outside the United States, primarily in Mexico and Latin America.

Industrial Films

        The Industrial Films segment accounted for 26.2%, 24.6% and 22.5% of our consolidated net sales in 2004, 2003 and 2002, respectively and for 27.7% and 24.6% of our consolidated net sales on March 31, 2005 and 2004, respectively.

        Our Industrial Films segment manufactures stretch and PVC films. In 2004, approximately 23% of our Industrial Films sales were outside the United States, primarily in Canada, Europe and Australia. Our customers in this segment include national distributors, such as Bunzl, and Xpedx; grocery chains, such as A&P, Kroger, Publix and Safeway; and end-users, such as P&G, Costco, and Wal-Mart.

        Stretch Films.    Our stretch films are used to bundle, unitize and protect palletized loads during shipping and storage. Stretch films continue to replace more traditional packaging, such as corrugated boxes and metal strapping, because of stretch films' lower cost, higher strength, and ease of use. We are North America's fourth largest producer of stretch films, with an estimated share of 10% of the North America Market.

        PVC Films.    Our PVC films are used by supermarkets, delicatessens and restaurants to wrap meat, cheese and produce. PVC films are preferred in these applications because of their clarity, elasticity and cling. We also produce PVC films for laundry and dry cleaning bags. Finally, we produce PVC films for companies that repackage the films in smaller cutterbox rolls for sale in retail markets in North America, Latin America and Asia. In 2004, we were the one of the largest producers of PVC films in North America, with an estimated market share of approximately 27%. In addition, we are the leading producer of PVC films in Australia, with an estimated market share of 60%, and have an estimated market share of approximately 15% in Europe.

Engineered Films

        The Engineered Films segment accounted for 22.6%, 21.9% and 24.1% of our consolidated net sales in 2004, 2003 and 2002, respectively and for 22.7% and 23.4% of our consolidated net sales on March 31, 2005 and 2004, respectively.

        Engineered films are sold to converters of flexible packaging who laminate them to foil, paper or other films, print them, and ultimately fabricate them into the final flexible packaging product. Our engineered films are a key component in a wide variety of flexible packaging products, such as fresh-cut produce packages, toothpaste tubes and stand-up pouches. Generally, our engineered films add value by providing the final packaging product with specific performance characteristics, such as moisture, oxygen or odor barriers, ultraviolet protection or desired sealant properties. Because engineered films are sold for their sealant, barrier or other properties, they must meet stringent performance specifications established by the converter, including gauge control, clarity, sealability and width accuracy. We are a leader in introducing new engineered film products to meet flexible packaging industry trends and specific customer needs. We are one of North America's leading manufacturer of films sold to converters, with an estimated market share of approximately 30%.

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Performance Films

        The Performance Films segment accounted for 10.1%, 11.8% and 11.6% of our consolidated net sales in 2004, 2003 and 2002, respectively and for 9.5% and 10.9% of our consolidated net sales on March 31, 2005 and 2004, respectively.

        We manufacture a variety of barrier and custom films, primarily for smaller, but profitable, niche segments in flexible packaging and industrial markets. For example, we have an estimated share of 20% of the North American market for films for cookie, cracker and cereal box liners. We are also a leading manufacturer of barrier films for liners in multi-wall pet food bags, films for photoresist coatings for the electronics industry, and films for the protection and transportation of sheet molding compound used in the manufacture of boats and automotive parts.

Sales and marketing

        Because of our broad range of product offerings and customers, our sales and marketing efforts are generally product or customer specific. We market in various ways, depending on both the customer and the product. However, most of our salespeople are dedicated to a specific product line and sometimes to specific customers.

        The majority of our Specialty Films, Engineered Films and Performance Films are sold by our own direct sales force. These salespeople are supported by customer service and technical specialists assigned to each salesperson, and in some cases, to specific customers. Customer service representatives assist with order intake, scheduling and product information. Technical support personnel assist the salesperson and the customer with technical expertise, quality control and product development. We believe it is critical that our sales, marketing and technical support teams work together in order to meet our customers' product needs and provide meaningful product development.

        We sell some of our Specialty Films, such as our agricultural films, through regional distributors. In addition, certain of our personal care films in Specialty Films and barrier films in Performance Films are sold through brokers who have long-standing relationships with customers.

        Most of our Printed Products are sold through brokers. National grocery chains and some smaller customer accounts are serviced by our own direct sales force. Generally, each salesperson is supported individually by a customer service specialist and by a group of technical specialists.

        Industrial Films are generally sold through distributors. We have an independent contract sales force that sells our stretch films to national and regional distributors. Our PVC films are sold by our own sales force to regional and national distributors, directly to national grocery chains, and directly to converters, who repackage the film into cutterbox rolls for sale in retail markets.

Manufacturing

        Between January 1, 2000 and March 31, 2005, excluding acquisitions, we have invested a total of $221.3 million to expand, upgrade and maintain our asset base and information systems. With 24 plants, we are often able to allocate lines to specific products. Our multiple manufacturing sites and varied production capabilities also allow us to offer multiple plant service to our national customers. Generally, our manufacturing plants operate 24 hours a day, seven days a week.

        We manufacture our film products using both blown and cast extrusion processes. In each process, thermoplastic resin pellets are combined with other resins, plasticizers or modifiers in a controlled, high temperature, pressurized process to create films with specific performance characteristics. Blown film is produced by extruding molten resin through a circular die and chilled air ring to form a bubble. In the cast film process, molten resin is extruded through a horizontal die onto a chill roll, where the film is quickly cooled. These two basic film manufacturing processes produce films with uniquely different

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performance characteristics. Cast films are generally clearer, softer and more uniform in thickness. Blown films offer enhanced physical properties, such as increased tear and puncture resistance and better barrier protection.

        We also produce a significant amount of printed films and bags. We employ both flexographic and rotogravure printing equipment in our printing operations.

Technology and research and development

        We believe our technology base and research and development provide critical support to our business and customers. Our research and development group provides the latest resin and extrusion technology to our manufacturing facilities and allows us to test new resins and process technologies. Our technical center in Newport News, Virginia has a pilot plant that allows the technical center to run commercial "scale-ups" for new products. We are able to use our broad product offerings and technology to transfer technological innovations from one market to another.

        Our technical representatives often work with customers to help them develop new, more competitive products. This allows us to enhance our relationships with these customers by providing the technical service needed to support commercialization of new products and by helping them to improve operational efficiency and quality throughout a product's life cycle.

        We spent $6.5 million, $7.3 million and $8.1 million on research and development for the years ended December 31, 2004, 2003 and 2002, respectively, and $2.0 million for the three months ended March 31, 2005 before giving effect to revenues from pilot plant sales. In addition, we participate in several U.S. government funded research and development programs.

Intellectual property rights

        Patents, trademarks and licenses are significant to our business. We have patent protection on many of our products and processes, and we regularly apply for new patents on significant product and process developments. We have registered trademarks on many of our products. We also rely on unpatented proprietary know-how, continuing technological innovation and other trade secrets to develop and maintain our competitive position. In addition to our own patents, trade secrets and proprietary know-how, we license from third parties the right to use some of their intellectual property. Although we constantly seek to protect our patents, trademarks and other intellectual property, our precautions may not provide meaningful protection against competitors and the value of our trademarks could be diluted.

Raw materials

        Polyethylene, PVC, polypropylene and other resins and additives constitute the major raw materials for our products. We purchase most of our resin from major oil companies and petrochemical companies in North America. For the year ended December 31, 2004, resin costs comprised approximately 61% of our total manufacturing costs. Raw material costs as a percentage of sales have increased to 59% for the first quarter of 2005, from 50% for the comparable period of 2004. Significant increases in the price of resins increase our costs, reduce our operating margins, and impair our ability to service our debt unless we are able to pass all of the increases on to our customers. The price of resins is a function of, among other things, manufacturing capacity, demand, and the price of crude oil and natural gas feed stocks. Resin shortages or significant increases in the price of resin have had and could continue to have a significant adverse effect on our business. Since the middle of 2002, we have experienced a period of significant uncertainty with respect to resin supplies and prices. High crude oil and natural gas pricing have had significant impact on the price and supply of resins. Prices for resin have risen dramatically during 2004 and could continue to rise in the second quarter of 2005 and

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beyond. Pliant's costs for resin on a weighted-average basis rose 29% from December 2003 to December 2004, with over half of that increase occurring in the fourth quarter of 2004.

        Major suppliers of resin have implemented price increases to cover their increases in petroleum costs, and to improve their operating margins as capacity utilization increases. Due in part to consolidation in the resin supply industry, suppliers have resisted the consumers' efforts to limit or defer the effect of these increases. Our goal is for the prices of our products generally to fluctuate with the price of resins. Approximately half of our sales are made on a transactional basis, which allows us to pass through resin price increases, although competitive market conditions in our industry from time to time limit our ability to pass the full cost of higher resin pricing through to our customers immediately or completely. The other approximately one half of our sales are made pursuant to customer contracts, most of which dictate the timing in our ability to pass through the increase. A large majority of these contracts allow resin cost increases to be passed along quarterly, with some allowing increased costs to be passed on more quickly and a small number requiring a longer delay. In combination, the cost to the Company of the gap between the speed in which increased costs are passed on to us and the time in which we can pass these costs on to our customers has a negative impact on both our results of operations and our working capital needs. This trend is industry wide and its impact was significant in 2004 and is likely to continue and possibly increase in the future.

        As one of the largest consumers of packaging resin in the United States, the Company is working on behalf of its customers with its suppliers to minimize the effects and the timing of the pass through of increased resin costs and to maximize the likelihood that resin supplies continue to be available to the Company in sufficient quantities and on timetables necessary to meet the needs of our customers. We also regularly evaluate commodity hedging, collar agreements, and other protective strategies and will implement them if and when appropriate. However, if this period of high resin pricing continues, the limits on our ability to pass through these costs to our customers will exert downward pressure on profits and negatively effect our cash flow and our working capital requirements.

Competition

        The markets in which we operate are highly competitive on the basis of service, product quality, product innovation and price. Small and medium-sized manufacturers that compete primarily in regional markets service a large portion of the film and flexible packaging market, and there are relatively few large national manufacturers. In addition to competition from many smaller competitors, we face strong competition from a number of large film and flexible packaging companies. Some of our competitors are substantially larger, are more diversified, and have greater resources than we have, and, therefore, may have certain competitive advantages.

Employees

        As of March 31, 2005, we had approximately 3,025 employees, of which approximately 740 employees were subject to a total of 8 collective bargaining agreements that expire on various dates between November 6, 2005 and June 30, 2007. The collective bargaining agreement covering our Langley union employees expired on February 28, 2005. We are currently operating under an informal extension of the terms of that agreement and are in negotiations with the union for a new collective bargaining agreement. We consider our current relations with our employees to be good. However, if major work disruptions were to occur, our business could be adversely affected.

Environmental matters

        Our operations are subject to environmental laws in the United States and abroad, including those described below. Our capital and operating budgets include costs and expenses associated with complying with these laws, including the acquisition, maintenance and repair of pollution control

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equipment, and routine measures to prevent, contain and clean up spills of materials that occur in the ordinary course of our business. In addition, our production facilities require environmental permits that are subject to revocation, modification and renewal. We believe that we are in substantial compliance with environmental laws and our environmental permit requirements, and that the costs and expenses associated with such compliance are not material to our business. However, additional operating costs and capital expenditures could be incurred if, for example, additional or more stringent requirements relevant to our operations are promulgated.

        From time to time, contaminants from current or historical operations have been detected at some of our present and former sites, principally in connection with the removal or closure of underground storage tanks. The cost to remediate these sites has not been material, and we are not currently aware that any of our facility locations have material outstanding claims or obligations relating to contamination issues.

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PROPERTIES

        Our principal executive offices are located at 1475 Woodfield Road, Suite 700, Schaumburg, IL 60173. We own most of the improved real property and other assets used in our operations. We lease all or part of six of the sites at which we have manufacturing operations. We also lease warehouse and office space at various locations. We consider the condition of our plants, warehouses and other properties and the other assets owned or leased by us to be generally good.

        Since 2001, the Company has undertaken an effort to maximize the efficiency of our facilities by closing and disposing of a number of facilities. Production from these facilities was moved in large part to plants that were not operating at capacity. During 2004, we closed our Harrisville, Rhode Island manufacturing facility and transferred production to more efficient plants. We also acquired ownership of that portion of our Macedon, New York facility that we previously leased from ExxonMobil Oil Corporation.

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        We have an annual film production capacity of approximately 1 billion pounds. Our principal manufacturing plants are listed below. Unless otherwise indicated, we own each of these properties.

SEGMENT	PRODUCTS
Engineered Films
Chippewa Falls, Wisconsin	Converter and personal care films
Danville, Kentucky	Converter, barrier, and custom films
Deerfield, Massachusetts	Converter films
Orillia, Canada (two plants)*	Converter films
Performance Films
Dalton, Georgia	Converter, barrier, and custom films
Bloomington, Indiana*	Barrier and custom films
Odon, Indiana	Barrier and custom films
Industrial Films
Barrie, Canada*	PVC and polyethylene films
Calhoun, Georgia	PVC films
Danville, Kentucky	Converter, barrier, and custom films
Lewisburg, Tennessee	Stretch films
Phillipsburg, Germany	PVC Films
Preston, Australia*	PVC films
Toronto, Canada	PVC films
Specialty Products Group
Specialty Films Division
Harrington, Delaware	Personal care, medical, and converter films
McAlester, Oklahoma	Personal care, medical, and converter films
Washington, Georgia	Personal care, medical, and agricultural films
Printed Products Division
Kent, Washington	Printed bags and rollstock
Langley, British Columbia*	Printed bags and rollstock
Macedon, New York	Printed bags and rollstock
Mexico City, Mexico*	Barrier and personal care films, printed bags and rollstock
Shelbyville, Indiana*	Reclosable zipper products
Corporate/Other
Newport News, Virginia	Research facility and pilot plant

*

Indicates a leased building. In the case of Orillia, Canada, one of the two plants is leased.

LEGAL PROCEEDINGS

        On June 14, 2004, we settled the complaint filed against us by S.C. Johnson & Sons, Inc. and S.C. Johnson Home Storage filed in the U.S. District Court for the District of Michigan, Northern Division (Case No. 01-CV-10343-BC) for $6.0 million plus legal fees which was within management's estimated costs of $7.2 million accrued in the fourth quarter of 2003.

        On February 26, 2003, former employees of our Fort Edward, NY manufacturing facility, which we acquired as part of the Decora acquisition, named us as defendants in a complaint filed in the Supreme Court of the State of New York, County of Washington (Index No. 4417E). We received service of this complaint on April 2, 2003, and successfully removed the case to the United States District Court for the Northern District of New York (Case No. 1:03cv00533). The complaint alleged claims against us for

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conspiracy to defraud and breach of contract arising out of our court-approved purchase of the assets of Decora Industries, Inc. and Decora, Incorporated. Plaintiffs' complaint sought compensatory and punitive damages and a declaratory judgment nullifying severance agreements for lack of consideration and economic duress. On December 15, 2004, the case was dismissed in response to our motions to dismiss. On January 13, 2005, the Plaintiff appealed the dismissal of the case to the United States Court of Appeals for the Second District. We intend to resist the plaintiffs' claims vigorously. We do not believe this proceeding will have a material adverse affect on our financial condition or results of operations.

        We are involved in ongoing litigation matters from time to time in the ordinary course of our business. In our opinion, none of such litigation is material to our financial condition or results of operations.

MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Market Information, Holders and Dividends

        At June 10, 2005, we had 571,711 shares of common stock outstanding and there were 37 holders of record of our common stock. There is no established trading market for our common stock.

        We have not declared or paid any cash dividends on our common stock during the last two years and do not anticipate paying any cash dividends in the foreseeable future. The indentures governing our outstanding debt securities contain certain restrictions on the payment of cash dividends with respect to our common stock, and our revolving credit facility also restricts such payments. In addition, the terms of our outstanding Series A Preferred Stock restrict the payment of cash dividends with respect to our common stock unless all accrued dividends on the Series A Preferred Stock have been paid.

Recent Sales of Unregistered Securities

        Since the adoption of the 2004 Restricted Stock Incentive Plan, we sold 720 shares of a newly created Series B Preferred Stock to our Chief Executive Officer and certain other officers in private transactions at $162 per share, which was determined to be the fair market value of those shares based on an independent appraisal received by the Board. We believe that the issuance of these shares was exempt from the registration requirements of the Securities Act pursuant to Section 4(2) thereof because the issuance did not involve a public offering or sale.

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MANAGEMENT

        Certain information about our executive officers and directors is presented below. Pursuant to the stockholders' agreement among us, the holders of our common stock and the holders of warrants to purchase our common stock, our board of directors currently consists of eight members, four of whom are designated by our institutional common stockholders and warrant holders, one of whom is designated by The Christena Karen H. Durham Trust, two of whom are independent, and one of whom is appointed by our board of directors and must be a member of our senior management. The trust has the right to designate a second director to the Board, but that Board seat is currently vacant.

Name	Age	Position
Harold C. Bevis	45	President and Chief Executive Officer, Acting Chief Financial Officer, and Director
John D. Bowlin	54	Director
Richard P. Durham	40	Director
Sean Epps	36	Director
Edward A. Lapekas	61	Non-Executive Chairman
Albert (Pat) MacMillan	61	Director
Jeffrey C. Walker	49	Director
Timothy J. Walsh	41	Director
R. David Corey	56	Executive Vice President and Chief Operating Officer
Paul R. Frantz	39	Senior Vice President and General Manager—Performance Films
Greg E. Gard	44	Senior Vice President, Technology & Innovation
Joseph J. Kwederis	58	Senior Vice President, Finance
Robert J. Maltarich	53	Senior Vice President and General Manager—Industrial Film
Kenneth J. Swanson	38	Senior Vice President, President Specialty Products Group
Coleman R. Wooldridge	57	Senior Vice President and General Manager—Engineered Films

        Harold C. Bevis was named President and Chief Executive Officer in October 2003. Mr. Bevis also serves on our Board of Directors and is currently serving as our Chief Financial Officer. He has over 20 years of global experience with multiple types of technology-driven manufactured products sold across a full range of sales channels. Mr. Bevis joined Pliant from Emerson Electric, where he served as President of Emerson Telecommunications Products, a group of manufacturing companies, beginning in 1998. Mr. Bevis led the sale of this group to Emerson while he was President and CEO of Jordan Telecommunication Products, Inc., a manufacturer of nonproprietary communications products. Prior to that, Mr. Bevis served as Senior Vice President and General Manager of General Cable Corporation, a large, vertically integrated domestic manufacturer of wire and cable products sold through wholesale and retail channels to companies such as The Home Depot, True Value Hardware, Rexel and Graybar. Mr. Bevis has also held positions of increasing responsibility with General Electric, Booz, Allen & Hamilton, and General Dynamics, where he began his career as an engineer. Mr. Bevis holds a B.S. in Industrial Engineering from Iowa State University and an MBA in Marketing from Columbia University in New York. Mr. Bevis is the director who is a member of our senior management.

        John D. Bowlin became one of our directors on January 31, 2005. Mr. Bowlin was President and Chief Executive Officer of Miller Brewing Company from 1999 until 2003, leading its sale to South African Breweries in 2002. From 1985 until 2002, Mr. Bowlin was employed by Philip Morris Companies, Inc., in various leadership capacities, including President, International, Kraft, Inc. (1996 - 1999), President and Chief Operating Officer, Kraft Foods, Inc. (1994 - 1996), President and Chief Operating Officer, Miller Brewing Company (1993 - 1994), and President, Oscar Mayer Food Corporation (1991-1993). Mr. Bowlin holds an MBA from Columbia University and a BS from Georgetown University. He is also a director of the Rayovac Corporation. Mr. Bowlin is one of the two independent directors.

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        Richard P. Durham became one of our directors on May 31, 2000. Mr. Durham also served as our President, from March 1997 through March 2001, and as our Chief Executive Officer from March 1997 through June 2002. He was also the chairman of our board of directors from May 31, 2000 to June 2002. Mr. Durham has been with various Huntsman Corporation affiliates since 1987. Prior to becoming our President, Mr. Durham served as Co-President and Chief Financial Officer of Huntsman Corporation. Mr. Durham is also a director of Huntsman Corporation. Mr. Durham is a graduate of The Wharton School of Business at the University of Pennsylvania. Mr. Durham is the Trust's designee to the board.

        Sean Epps became one of our directors on January 31, 2005. Mr. Epps has been a Principal of J.P. Morgan Partners, LLC (formerly, Chase Capital Partners). J.P. Morgan Partners, LLC is a global partnership and has been the company's principal stockholder since 2000, and prior to that was an associate of that entity. Mr. Epps has extensive experience managing J.P. Morgan Partners, LLC' portfolio companies, and is also on the Board of Directors of Brand Services, Inc. and Chromalox Corporation. Mr. Epps holds a BA from Hamilton College and an MBA from The Wharton School, University of Pennsylvania. Mr. Epps is one of the persons designated to serve on the board by our institutional common stockholders and warrant holders.

        Edward A. Lapekas became one of our directors on December 19, 2001 and became our Non-Executive Chairman on October 22, 2003. Mr. Lapekas served as our interim Chief Executive Officer from August 24, 2003 until October 22, 2003. From November 2002 until March 2003, Mr. Lapekas served as Chairman and Chief Executive Officer of NexPak Corporation, a media packaging company. Prior to that, Mr. Lapekas was Executive Chairman of Packtion Corporation, an e-commerce venture, from October 2000 until June 2001. From May 1996 until July 2000, Mr. Lapekas was employed by American National Can Group, Inc., last serving as Chairman and Chief Executive Officer. Prior to that, Mr. Lapekas served as Deputy Chairman and Chief Operating Officer of Schmalbach-Lubeca AG. From 1971 until 1991, Mr. Lapekas was employed by Continental Can Company, where he served in various strategy, planning, operating and marketing capacities. Mr. Lapekas is also a director of Silgan Corp. He received a B.A. degree from Albion College and an M.B.A. degree from Wayne State University. Mr. Lapekas is one of the two independent directors.

        Albert (Pat) MacMillan became one of our directors on December 19, 2001. Mr. MacMillan is the founder and CEO of Team Resources, a consulting firm with offices in the United States, Venezuela, Peru, Chile, and Mexico. Founded in 1980, Team Resources provides client services in the areas of strategy, building team-based organizations, and designing leadership development strategies. He also serves on the boards of directors of Unum/Provident and Metokote Corporation, as well as several foundations and non-profit organizations. He received a B.A. degree in Business and an M.B.A. degree from the University of Washington. Pursuant to the stockholders' agreement, Mr. MacMillan is one of the designees to the board by our institutional common stockholders and warrant holders.

        Jeffrey C. Walker became one of our directors on July 1, 2004. Mr. Walker is Managing Partner of J.P. Morgan Partners, LLC (formerly, Chase Capital Partners) and Vice Chairman of JPMorgan Chase. J.P. Morgan Partners, LLC is a global partnership and has been the Company's principal stockholder since 2000. Before co-founding JPMorgan Partners in 1984, Mr. Walker worked in the Investment Banking and Finance Divisions of Chemical Bank and the Audit and Consulting Divisions of Arthur Young & Co. He is also a director of numerous private and public corporations (1-800-Flowers, Metroplex, Doane Pet Care, House of Blues, Metokote and Axis Insurance). Mr. Walker is a Certified Public Accountant and a Certified Management Accountant, and holds a BS degree from the University of Virginia and an MBA from the Harvard Business School. Mr. Walker is one of the designees to the board by our institutional common stockholders and warrant holders.

        Timothy J. Walsh became one of our directors on May 31, 2000. He served as Non-Executive Chairman from June 2002 until October 2003. Mr. Walsh is an executive officer of JPMP Capital Corp., which is the general partner of JPMP Master Fund Manager, L.P., which is the general partner of

73

J.P. Morgan Partners (BHCA), L.P., our principal stockholder. Since 1999, Mr. Walsh has been a Partner of J.P. Morgan Partners, LLC (formerly, Chase Capital Partners). JP Morgan Partners is a global partnership and has been the Company's principal stockholder since 2000. It is a leading provider of private equity and has closed over 1,300 individual transactions since its inception in 1984. JP Morgan Partners has more than 140 investment professionals in eight regional offices throughout the world. JP Morgan Partners' primary limited partner is J.P. Morgan Chase & Co. (NYSE: JPM), one of the largest financial institutions in the United States. From 1993 to 1999, Mr. Walsh held various positions with J.P. Morgan Partners in Europe and North America. Prior to 1993, he was a Vice President of J.P. Morgan Chase & Co. (formerly, The Chase Manhattan Corporation). Mr. Walsh is also a director of Better Minerals & Aggregates Company, Klockner Pentaplast S.A. and Metokote Corporation. Mr. Walsh received a B.S. degree from Trinity College and an M.B.A. degree from the University of Chicago. Pursuant to the stockholders' agreement, Mr. Walsh is one of the designees to the board by our institutional common stockholders and warrant holders.

        R. David Corey was named Chief Operating Officer in March 2004. He joined Pliant as Executive Vice President for Global Operations in November 2003. Mr. Corey has over 30 years of experience leading extrusion-based manufacturing businesses. Mr. Corey was a senior executive at Emerson Electric where he was President of Dura-Line, a manufacturing business that produced telecom, gas and water conduit products. He supervised plants and sales forces in the US, Mexico, UK, Spain, Brazil, Czech Republic, Malaysia, India and China. Previously, Mr. Corey was President of International Wire with operations in the US and Asia. Prior to that, Mr. Corey was Senior Vice President and General Manager of Telecom products for General Cable Corporation. He earned a B.S. in Business from Eastern Illinois University.

        Paul R. Frantz is currently the Senior Vice President and General Manager of the Performance Films Division. Mr. Frantz joined Pliant Corporation in July of 1992 following the acquisition of Goodyear Tire and Rubber Company's Film Division. Since that time, he has held numerous positions within the company. Most recently he has served as Senior Vice President Sales and Marketing Marquee Accounts. In 2003 he served as Senior Vice President Sales and Marketing for Pliant Solutions, from 2001 - 2003 he was Vice President Sales and Marketing for Secondary Packaging, and from 1999 - 2000 he was Managing Director—Europe. Other positions have included Director Sales and Marketing for Secondary Packaging and Marketing Manager for Secondary Packaging. Prior to joining Pliant Corporation, Mr. Frantz held various sales management positions with Goodyear and operations management positions in the thermoforming segment of the plastics industry. He holds a B.B.A. degree in Economics and Finance from Baylor University.

        Greg E.Gard joined Pliant Corporation in 1989 and has held numerous technical positions supporting the various market segments within Pliant Corporation. Today, he serves as Senior Vice President of Technology and Innovation. His responsibilities in this regard include Product Development and Technical Service for the Corporation, with particular focus on shortening product development cycles, improving speed to market, and directing a team of packaging professionals in the development of packages that protect and preserve while improving functionality and appearance. Before joining Pliant, Mr. Gard held engineering and management positions with Cryovac Sealed Air Corporation. Prior to this he worked for several years as an engineer with Dresser Atlas in oil and gas exploration. He holds a B.S. degree in electrical and computer engineering from the University of Wisconsin Madison. Mr. Gard is actively involved with Clemson University's Packaging Science program, one of only four academic institutions in the United States that offers a four-year program leading to a B.S. degree in Packaging Science. Currently, he serves on the Packaging Advisory Board at Clemson.

        Joseph J. Kwederis joined Pliant Corporation as Senior Vice President, Finance in February 2005. Prior to joining Pliant Corporation, Mr. Kwederis was Senior Vice President/CFO of Dura-line Corporation from 1999 - 2004, and VP of Finance for International Wire Group from 1996 - 1999. From 1974 until 1996 he held positions of increasing responsibility in Accounting and Finance at

74

General Cable Corporation. Mr. Kwederis holds a BS in Accounting from Rutgers University and an MBA from the University of Connecticut.

        Robert J. Maltarich joined Pliant Corporation in July of 1992 following the acquisition of Goodyear Tire & Rubber Company's Films Division. Since that time, he has held numerous positions within Pliant Corporation. From 1992 - 1993 he served as Marketing Manager Film Products Worldwide, from 1994 - 1996 he was Director of National Accounts, and from 1997 - 1998 he was General Manager Custom Films Group. Other positions included Vice President and General Manager Barrier and Custom Films and, most recently, Senior Vice President of Sales, Flexible Packaging. Mr. Maltarich was promoted in October 2002 to Vice President and General Manager, Industrial Films, where he oversees Pliant's Stretch, Custom, and PVC film businesses. Prior to joining Pliant Corporation, Mr. Maltarich held numerous national and international positions in both sales and marketing with Goodyear Tire & Rubber Company. During his 18-year career at Goodyear, he served as General Marketing Manager Film Products Worldwide, General Manager European Film Products, Manager Film Products USA and District Sales Manager. He holds a B.S. degree in Business Administration from the University of Akron.

        Kenneth J. Swanson is currently President, Specialty Products. Prior to this position, Mr. Swanson was the Senior Vice President and General Manager of the Specialty Films Division at Pliant. Since 1992, Mr. Swanson has had various leadership positions with CT Film, Huntsman Packaging, and Pliant. Prior to 1992, Mr. Swanson held multiple sales management positions in the injection molding segment of the plastics industry. Mr. Swanson holds a B.Sc. degree in Business Management from the University of Redlands, Redlands, CA.

        Coleman R. Wooldridge joined Pliant Corporation in 1993 as the Plant Manager of the Dalton, Ga. Facility and in 1997 moved to Bloomington, Indiana as Plant Manager of the Bloomington and Odon plants. He was promoted to Vice President of Manufacturing in May of 1999, where he was responsible for the Converter, Personal Care and Barrier Division manufacturing operations. He was promoted to his current role of Vice President and General Manager of the Converter Division in October of 2002. Prior to joining Pliant, Mr. Wooldridge spent 4 years at Sonoco Products Company, where he held several positions in the manufacturing area, including Plant Manager in the High Density Film Products Division. Mr. Wooldridge began his career at General Electric, where he spent 15 years working in Supervisory roles and as a Product Development Engineer in plastics processing, which included work in injection and compression molding, vacuum forming and engineering resins. He holds a B.Sc. degree in Business Management from the University of Louisville, and a M.A. degree in Human Resource Development and Management from Webster University, St. Louis.

Code of Ethics for Officers

        Our board of directors plans to adopt a code of ethics for all officers and directors which will be available upon request, but has not yet done so because the Company's equity securities are not registered under the Exchange Act or subject to the listing rules of any stock exchange or automated quotation system.

Audit Committee

        Our Board of Directors has an audit committee. The audit committee maintains oversight responsibilities with respect to our accounting, auditing, financial reporting and internal control processes generally. The members of the audit committee are Timothy J. Walsh and Edward A. Lapekas. Mr. Lapekas is considered independent within the meaning of Section 10A(m)(3) of the Securities Exchange Act of 1934, as amended. Mr. Walsh may not be deemed independent in light of the numerous transactions between the Company and J.P. Morgan Partners and its affiliates (see Item 13, "Certain Relationships and Related Transactions"). A person who at the time was serving as a Director was appointed as the financial expert of the audit committee during 2004. However that

75

member resigned from our Board of Directors and as Chairman of the audit committee on January 31, 2005.

Compensation Committee

        Our Board of Directors has a compensation committee. The compensation committee maintains oversight responsibilitieswith respect to the compensation of our officers and directors. The members of the compensation committee are Albert (Pat) MacMillan, Timothy J. Walsh and Harold C. Bevis.

EXECUTIVE COMPENSATION

        The following summary compensation table sets forth information about compensation earned in the fiscal years ended December 31, 2004, 2003 and 2002 by each person serving as Chief Executive Officer during 2004 and the four other most highly compensated persons who were serving as executive officers of the Company (other than the Chief Executive Officer) as of the end of the last fiscal year and one other individual who would have been in that group of the most highly compensated persons but was not serving as an executive officer as of the end of the last fiscal year (collectively, the "Named Executive Officers").

Summary compensation table

					Long-term compensation
		Annual compensation(1)			Restricted Stock Awards
Name and principal position	Year	Salary ($)	Bonus ($)(2)		Total Shares Granted/Vested in 2004(3)	All other Compensation(4)
Harold C. Bevis(5) President and Chief Executive Officer	2004 2003 2002	608,333 78,974 —	928,974 — —	(6)	480 / 30 — —	1,083 — —
R. David Corey(7) Executive Vice President and Chief Operating Officer	2004 2003 2002	333,333 33,175 —	224,880 — —	(8)	48 / 3 — —	65,101 — —	(9)
Paul R. Frantz(10) Senior Vice President and General Manager—Performance Films	2004 2003 2002	196,167 169,086 145,497	100,000 9,968 15,625		16 / 0 — —	3,850 3,394 3,222
Kenneth J. Swanson(11) Senior Vice President, President Specialty Products	2004 2003 2002	219,500 168,500 153,751	150,000 34,518 16,015		40 / 2.5 — —	4,000 4,000 3,353
Greg E. Gard(12) Senior Vice President, Technology and Innovation	2004 2003 2002	215,333 162,500 146,680	90,000 27,900 19,130		16 / 1 — —	4,000 3,808 3,286
Brian E. Johnson(13) Former Executive Vice President and Chief Financial Officer	2004 2003 2002	296,633 267,799 267,799	46,900 47,860 41,928		— — —	4,000 4,000 5,700

(1)

Perquisites and other personal benefits, securities or property, in the aggregate, are less than either $50,000 or 10% of the total annual salary and bonus reported for the applicable Named Executive Officer.

(2)

All amounts for 2004 paid pursuant to 2004 Management Incentive Plan, except as indicated.

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(3)

Pursuant to the 2004 Restricted Stock Incentive Plan, certain executive officers of the Company were permitted to purchase shares of Series B Redeemable Preferred Stock in September of 2004 for $162.00 per share, which we determined to be the fair market value of those shares pursuant to an independent appraisal. One 48^th of those shares vest each month, subject to the holder being employed by the Company as of such dates. Three months (or .0625%) of the restricted shares granted to each such individual other than Mr. Frantz vested during 2004. Mr. Frantz' shares were not issued until December 2004, therefore none of his shares vested in 2004.

(4)

All amounts reflect contributions for employer's 401(k) contributions, except as indicated.

(5)

Mr. Bevis was appointed President and Chief Executive Officer in October 2003.

(6)

Includes bonus of $850,000, paid in 2005 pursuant to the 2004 Management Incentive Compensation Plan and an additional discretionary bonus of $78,974 paid in 2004.

(7)

Mr. Corey was appointed Executive Vice President of Global Operations in November 2003. He was promoted to Chief Operating Officer in March 2004.

(8)

Includes bonus of $200,000, paid in 2005 pursuant to the 2004 Management Incentive Compensation Plan and an additional discretionary bonus of $24,880 paid in 2004.

(9)

Includes $61,101 of moving expenses paid in 2004.

(10)

Mr. Frantz was appointed Senior Vice President and General Manager—Performance films and became an executive officer on March 1, 2004.

(11)

Mr. Swanson was appointed Senior Vice President and General Manager—Specialty Products Group and became an executive officer on February 16, 2004.

(12)

Mr. Gard was appointed Senior Vice President, Technology and Innovation and became an executive officer on March 11, 2004.

(13)

Mr. Johnson resigned as Executive Vice President and Chief Financial Officer effective September 16, 2004, but remained an non-executive officer employee of the Company until December 31, 2004.

Incentive Plans Adopted in 2004

        Effective January 1, 2004, our Board of Directors adopted two new benefit plans in which some or all of the Named Executive Officers may participate: the 2004 Management Incentive Compensation Plan and the 2004 MIP Long Term Incentive Plan. The participants in the 2004 Management Incentive Compensation Plan were paid a bonus of $4,075,780 in 2005 relating to achievement of certain EBITDA and operating free cash flow goals for 2004. All Named Executive Officers participated in this plan and received bonuses for their 2004 performance, except the Chief Executive Officer, in the amounts indicated in the foregoing table. In addition, participants in the 2004 MIP Long Term Incentive Plan, which includes all officers and other key management personnel of the Company (except the Chief Executive Officer), received a credit of half of the 2004 bonus amount to the accumulated amount of their Long term Incentive Plan Award that they can earn under the 2004 MIP Long Term Incentive Plan, which can be become payable on December 31, 2007 under the terms of that plan. In August 2004, our Board of Directors adopted the 2004 Restricted Stock Incentive Plan. The grants under the 2004 Restricted Stock Incentive Plan are described below.

Stock Options and Restricted Stock

        Pursuant to the recapitalization, options covering a total of 8,902 common shares were rolled over from a previous plan. In addition, we adopted our 2000 Stock Incentive Plan. The 2000 plan became effective as of the consummation of the recapitalization and authorizes grants of nonqualified stock options or restricted stock to employees, officers, directors, managers or advisors of Pliant or any of its subsidiaries. As amended, a total of 65,600 shares are authorized for issuance under the 2000 plan. As

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of December 31, 2003, we had outstanding grants of restricted stock covering 8,041 shares of common stock and options to acquire 45,012 shares of common stock under the 2000 plan. Shares of restricted stock that are forfeited, and unissued shares reserved for issuance pursuant to options that terminate, expire or are cancelled without having been fully exercised, become available to be issued pursuant to new grants under the 2000 Plan.

        In August 2002, we adopted our 2002 Stock Incentive Plan. The 2002 plan authorizes grants of incentive stock options, nonqualified stock options and stock bonuses, as well as the sale of shares of common stock, to our and any of our subsidiaries' employees, officers, directors and consultants. A total of 4,793 shares are authorized for issuance under the 2002 plan.

        Since the adoption of our 2004 Restricted Stock Incentive Plan in September 2004, we have sold to our President and Chief Executive Officer and certain other Named Executive Officers a total of 720 shares of a newly-created, non-voting Series B Redeemable Preferred Stock for a cash purchase price of $162 per share, which was determined by our Board to be the fair market value of these shares as of such date based on an independent appraisal received by the Company. The Series B Preferred Stock will be automatically converted into common equity of the Company upon the consummation of an underwritten public offering registered under the Securities Act of shares of capital stock of the Company resulting in aggregate proceeds (net of underwriters discounts and commissions) to the Company of not less than $100 million.

        During the year ended December 31, 2004, 3,850 options to purchase common stock were granted and 17,394 options were cancelled. No stock options were granted to the Named Executive Officers during 2004.

        The following table provides information as to the options held by each of the Named Executive Officers at the end of 2004. There is no established trading market for our common stock and, therefore, the aggregate market value of our shares cannot be determined by reference to recent sales or bid and asked prices. The value of unexercised in-the-money options was assumed to be equal to the price per share paid in the recapitalization $483.13 per share. None of the Named Executive Officers exercised any options during the last fiscal year.

Aggregated option exercises in last fiscal year and FY-end option values

Name	Shares acquired on exercise	Value realized	Number of securities underlying unexercised options at fy-end (#) exercisable/unexercisable		Value of unexercised in-the-money options at fy-end ($) exercisable/unexercisable
Paul R. Frantz	—	—	137/863		0/0
Greg E. Gard	—	—	132/1,368		0/0
Brian E. Johnson	—	—	4,000/0	(1)	0/0
Kenneth J. Swanson	—	—	137/1,363		0/0

(1)

Mr. Johnson has the right to exercise all of his options on or before March 30, 2005. All options unexercised on such date lapsed.

        The options or restricted common stock granted prior to January 1, 2001 pursuant to the 2000 plan, as amended, provide for vesting as follows: (1) one-sixth are "time-vested" options or shares, which vested on January 1, 2001, so long as the recipient was still our employee on such date, and (2) the remainder are "performance-vesting" options or shares, which vest in increments upon the achievement of performance targets as follows: (a) vesting in full, if 100% or more of the applicable performance target is achieved as of the end of any calendar quarter during the option term and (b) partial vesting if more than 90% of the applicable performance target is achieved as of the end of any calendar quarter during the option term. Moreover, all performance-vesting options or shares not previously vested in accordance with the preceding sentence will vest automatically in full on

78

December 31, 2009 so long as the recipient is still our employee on such date. Options granted pursuant to the 2000 plan subsequent to January 1, 2001 vest similarly, except that all of the options are "performance-vesting" options, which vest in increments upon the achievement of performance targets.

Long Term Incentive Plan

        Effective January 1, 2004, we adopted the 2004 MIP Long Term Incentive Plan to provide performance based incentives to eligible management associates who maintain their relationship with the Company over a period of years. Pursuant to this plan, one half of any award earned by any participants under each applicable management incentive plan during the four-year period beginning January 1, 2004 through December 31, 2007, will be added to the amount of the award that can be earned by the participant under this Long Term Incentive Plan. Such amounts can be earned by a participant if he or she (i) is actively employed by the Company or an affiliate during that four-year period and on the date of the payment of the award (March 15, 2008), (ii) has performed his or her duties to the satisfaction of the Board, and (iii) meets certain other criteria requiring not acting in a way that is inimical to the best interests of the Company, complying with Company policies, not breaching agreements benefiting the Company. Mr. Bevis does not participate in the 2004 MIP Long Term Incentive Plan. The following Named Executive Officers participate in this plan and accrued the following award amounts under the plan as a result of bonuses paid with respect to performance during 2004 under the 2004 Management Incentive Compensation Plan:

Long-Term Incentive Plans—Awards in 2004

Name	Award Amount Accrued in 2004	Payout Date
R. David Corey	100,000	December 31, 2007
Paul R. Frantz	50,000	December 31, 2007
Kenneth J. Swanson	75,000	December 31, 2007
Greg E. Gard	45,000	December 31, 2007
Brian E. Johnson	-0-	—

Pension plans

        Effective July 1, 2004, we adopted the Fourth Amendment to the Pliant Corporation Defined Benefit Pension Plan. The purpose of this amendment was to "freeze" the benefits payable under such plan as of June 30, 2004, for all participants in the plan who are not subject to the collective bargaining agreement between the Company, South Deerfield, Massachusetts and the United Electrical Radio and Machine Workers of America and Local 274, such that no further benefits will accrue to current or future employees under that plan. Persons employed by the Company as of December 31, 2002, who did not have 5 years of vesting service as of June 30, 2004 (the minimum service period required to qualify for benefits under the Plan) will continue to accrue vesting service toward this minimum so long as they continue to be employed by the Company after June 30, 2004. For all employees that qualify for benefits under the Plan, as amended, their average final compensation and years of service credit (except as noted above) will be fixed as of June 30, 2004. Mr. Frantz, Mr. Gard and Mr. Swanson were the only Named Executive officers that met the 5 year service requirement at June 30, 2004. As of June 30, 2004, the accrued pension plan benefit for (i) Mr. Frantz was $2,671 per month payable beginning December 1, 2030 or $1,051 per month payable beginning June 1, 2017; (ii) Mr. Gard $1,968 per month payable beginning December 1, 2025 or $628 per month payable beginning June 1, 2015; and (iii) Mr. Swanson $1,878 per month payable beginning November 1, 2031 or $600 per month payable beginning January 1, 2020. None of the other Named Executive Officers are eligible to participate in the Pliant Corporation Defined Benefit Pension Plan.

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Employment agreements

        Effective January 1, 2004, the Company entered into a four-year employment agreement with Mr. Bevis, our President and Chief Executive Officer. The employment agreement provides for the payment of a base salary of $650,000. Mr. Bevis is guaranteed an annual bonus of $650,000 if he is employed during the calendar year, payable no later than ten business days following the Company's receipt from its public accountants of the audited consolidated financial statements of the Company for such calendar year. The employment agreement also provides that Mr. Bevis will participate in all bonus and incentive plans or arrangements which may be provided by the Company from time to time to its senior executives, with award opportunities commensurate with this position, duties and responsibilities. The employment agreement expressly excludes from these benefits the Management Incentive Plan, the Pliant 2000 Stock Incentive Plan, the Pliant 2002 Stock Incentive Plan and any other equity based incentive or compensation plans. The employment agreement expressly includes the Pliant 2004 Restricted Stock Incentive Plan, at least four weeks paid vacation per year, and includes non-disclosure of confidential information provisions and a non-compete provision for one year following termination of employment with us (unless termination was due to the term expiring). Mr. Bevis has agreed in his employment agreement that any inventions, improvements, technical or software developments, trademarks, patents and similar information relating to us or our business, products or services conceived, developed or made by him while employed by us belong to us. If Mr. Bevis' employment is terminated without cause or he resigns for good reason, he will be entitled to receive severance payments and continue to participate in our medical and dental plans for one year.

        On March 30, 2001, we entered into a five-year employment agreement with Brian E. Johnson, our Executive Vice President and Chief Financial Officer. On December 31, 2004 we entered into a Release Agreement with Mr. Johnson, whereby Mr. Johnson terminated his employment with the Company. Pursuant to the Release Agreement, Mr. Johnson acknowledged that he had received all of his compensation from the Company and that the only equity interests Mr. Johnson would hold in the Company post-termination would be 18 shares of Series A Preferred Stock, Warrants to purchase 18,270 shares of common stock and the option to purchase 1,000 shares of common stock pursuant to the 2000 Stock Incentive Plan and the Option Agreement related thereto. The Company agreed to pay Mr. Johnson his base salary until December 31, 2005 and his bonus based on the 2004 calendar year under the Management Incentive Plan. Mr. Johnson also receives medical and dental benefits until December 31, 2005 and outplacement service benefits for six months not to exceed $20,000.

        We have not entered into employment agreements with Mr. Corey, Mr. Frantz, Mr. Swanson and Mr. Gard.

Compensation of directors

        Each director who is not an employee of ours or a partner or senior advisor of J.P. Morgan Partners, LLC is entitled to receive an annual fee of $30,000, plus $10,000 per year for any committee service. Currently there are three directors who receive director fees: Messrs. Durham, Lapekas and MacMillan. In addition, Mr. Lapekas will receive a fee of $100,000 per year for his service as Non-Executive Chairman and a fee of $30,000 per year for serving on our audit committee.

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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT AND RELATED STOCKHOLDER MATTERS

Security Ownership of Certain Beneficial Owners and Management

        The following table contains information with respect to the ownership of our common stock as of June 10, 2005 by:

•

each person known to own beneficially more than 5% of our common stock,



•

each of our directors,



•

each of our Named Executive Officers, and



•

all of our executive officers and directors as a group.

        The amounts set forth in the table and footnotes below do not include shares of restricted common stock issued under the 2000 plan that remain subject to performance vesting requirements that had not been met as of June 10, 2005.

        Pursuant to a stockholders' agreement dated May 31, 2000, the parties to that agreement have committed to vote their shares in the election of directors in the manner described in "Certain relationships and related transactions—The stockholders' agreement."

        The amounts and percentages of shares beneficially owned are reported on the basis of SEC regulations governing the determination of beneficial ownership of securities. Under SEC rules, a person is deemed to be a "beneficial owner" of a security if that person has or shares voting power or investment power, which includes the power to dispose of or to direct the disposition of such security. A person is also deemed to be a beneficial owner of any securities of which that person has a right to acquire beneficial ownership within 60 days. Securities that can be so acquired are deemed to be outstanding for purposes of computing such person's ownership percentage, but not for purposes of computing any other person's percentage. Under these rules, more than one person may be deemed to be a beneficial owner of the same securities and a person may be deemed to be a beneficial owner of securities as to which such person has no economic interest.

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        Except as otherwise indicated in these footnotes, each of the beneficial owners listed has, to our knowledge, sole voting and investment power with respect to the indicated shares of common stock.

	Number of shares of common stock beneficially owned	Percent of class
JPMP Capital Corp.(1)(2)	405,169	61.44	%
Southwest Industrial Films, LLC/Southwest Industrial Films II, LLC(1)(2)	405,169	61.44	%
The Christena Karen H. Durham Trust(3)(4)	158,917	27.8	%
Perry Acquisition Partners-2, L.P.(5).	34,527	6.0	%
Harold C. Bevis	0	0.0	%
R. David Corey	0	0.0	%
Richard P. Durham(4)	24,283	4.07	%
Durham Capital Limited(4)	24,283	4.07	%
Timothy J. Walsh(2)	0	0.0	%
Edward A. Lapekas	207	*
Albert (Pat) MacMillan	0	0.0	%
Brian E. Johnson	1,018	*
Jeffery C. Walker(2)	0	0.0	%
John D. Bowlin	0	0.0	%
Sean Epps(2)	0	0.0	%
Paul R. Frantz(6)	34.21	*
Robert J. Maltarich(7)	112.48	*
Kenneth J. Swanson	45.225	*
Greg E. Gard	152.48	*
Coleman R. Woolridge	144.33	*
All directors and executive officers as a group (14 persons)	24,997	4.36	%

*

Less than 1%.

(1)

Includes (i) 317,306 shares of common stock held by Southwest Industrial Films, LLC, which is controlled by J.P. Morgan Partners (BHCA), L.P., as managing member, (ii) 43,047 shares of common stock which are issuable upon exercise of warrants to purchase common stock issued in connection with our Series A preferred stock held by Southwest Industrial Films II, LLC, which is controlled by J.P. Morgan (BHCA), L.P., as managing member, and (iii) 44,816 shares of common stock which are issuable upon exercise of warrants to purchase common stock issued in connection with our preferred stock held by Southwest Industrial Films, LLC. JPMP Capital Corp. is the indirect general partner of J.P. Morgan Partners (BHCA), L.P., and a wholly-owned subsidiary of J.P. Morgan Chase & Co., a publicly traded company. JPMP Capital Corp. and each of the foregoing entities is an affiliate of J.P. Morgan Partners, LLC and has an address c/o J.P. Morgan Partners, LLC, 1221 Avenue of the Americas, 39^th Floor, New York, New York 10020.

(2)

Mr. Walsh, Mr. Walker and Mr. Epps may be deemed the beneficial owners of the shares of common stock and warrants owned by each of Southwest Industrial Films, LLC and Southwest Industrial Films II, LLC, respectively, due to their positions with JPMP Capital Corp. and J.P. Morgan Partners, LLC, which are affiliates of J.P. Morgan Partners (BHCA), L.P., which in turn controls each of Southwest Industrial Films, LLC and Southwest Industrial Films II, LLC, as managing member. Mr. Walsh, Mr. Walker and Mr. Epps disclaim beneficial ownership of the shares of common stock owned by each of Southwest Industrial Films, LLC and Southwest Industrial Films II, LLC.

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(3)

The address of The Christena Karen H. Durham Trust is P.O. Box 17600, Salt Lake City, Utah 84117. The trustee of the Trust is Richard P. Durham. The Trust was established for the benefit of Christena H. Durham and her children. Christena H. Durham is the wife of Richard P. Durham.

(4)

Includes 23,033 shares of Common Stock held by Durham Capital Limited, an entity controlled by Richard P. Durham, and 1,250 shares of common stock held by Durham Capital Limited issuable upon exercise of warrants to purchase common stock issued in connection with our Series A preferred stock. As trustee of The Christena Karen H. Durham Trust and the spouse of Christena H. Durham, who is a beneficiary of the Trust, Richard P. Durham may be deemed the beneficial owner of the shares of common stock owned by the Trust. Richard P. Durham disclaims beneficial ownership of the shares of common stock owned by the Trust. The address for each of these persons and entities is 5772 South Holladay Blvd., Salt Lake City, Utah 84121.

(5)

Includes 231 shares of common stock held by Perry Principals Holdings, LLC and 4,060 shares of common stock which are issuable upon exercise of warrants to purchase common stock issued in connection with our preferred stock held by Perry Acquisition Partners-3, L.P. Richard C. Perry is the managing member of Perry Principals Holdings, LLC and the managing member of Perry Investors-2, LLC, which is the general partner of Perry Acquisition Partners-2, L.P. Richard C. Perry is also the president of Perry Corp., which is the indirect general partner of Perry Acquisition Partners-3, L.P. As such, Richard C. Perry may be deemed to have voting and investment power with respect to the shares of common stock and warrants owned by Perry Acquisition Partners-2, L.P., Perry Acquisition Partners-3, L.P. and Perry Principals Holdings, LLC. Richard C. Perry disclaims beneficial ownership of such shares and warrants, except to the extent of his pecuniary interest therein. Each of the foregoing entities is an affiliate of Perry Acquisition Partners L.P. and has an address c/o Perry Acquisition Partners L.P., 599 Lexington Avenue, New York, New York 10022.

(6)

Includes 20 shares of issued Common Stock and 14.21 shares of Common Stock issuable upon exercise of warrants.

(7)

Includes 80 shares of issued Common Stock and 32.48 shares of Common Stock issuable upon exercise of warrants.

Securities Authorized for Issuance under Equity Compensation Plans

        The following table sets forth information relating to our equity compensation plans as of December 31, 2004. Our equity securities are closely held and are not publicly traded. In addition, as required by our stockholders' agreement, a majority of our board of directors has been appointed by our institutional common stockholders and warrant holders, including our controlling shareholder. Therefore, our board of directors approves our equity compensation plans without obtaining approval directly from our shareholders.

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Equity Compensation Plan Information

Plan category		Number of securities to be issued upon exercise of outstanding options, warrants and rights(1)		Weighted-average exercise price of outstanding options, warrants and rights		Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column(a))
		(a)		(b)		(c)
Equity compensation plans approved by security holders		—			—	—
Equity compensation plans not approved by security holders		53,289	(2)	$	419.13	21,213
	Total	53,289		$	419.13	21,213

(1)

Pursuant to the 2004 Restricted Stock Incentive Plan, during 2004 the Company issued 720 shares of Series B Redeemable Preferred Stock to the officers at a purchase price of $162 per share, which was deemed to be the fair market value of those shares based on an independent appraisal received by the Board.

(2)

Includes 8,041 shares of restricted stock issued under the 2000 Stock Incentive Plan.

        The equity compensation plans not approved by security holders include our 2000 Stock Incentive Plan 2002 Stock Incentive Plan, and 2004 Restricted Stock Incentive Plan. The material features of these plans are described under Item 11, "Executive Compensation—Stock Options and Restricted Stock," Item 13 "Certain Relationships and Related Transactions," and in Note 11 to our consolidated financial statements.

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CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Transactions with Management

Agreements with Executive Officers and Directors

        Effective January 1, 2004, we entered into a four -year employment agreement with Harold C. Bevis, our President and Chief Executive Officer and on December 31, 2004, we entered into a Release Agreement with Brian E. Johnson (see Item 11—Executive Compensation).

        On January 26, 2005, we entered into a Letter Agreement with James Ide, terminating his employment as our Executive Vice President and Chief Financial Officer, effective February 28, 2005. Pursuant to such Letter Agreement, Mr. Ide received a $70,000 bonus for 2004.

        On March 18, 2005, we entered into a Severance and Release Agreement with Lori Roberts, terminating her employment as our Senior Vice President, Human Resources, effective April 1, 2005. Pursuant to the Severance and Release Agreement, Ms. Roberts will receive a lump sum severance payment in the amount of $404,437, which includes the Company's payment for 28 shares of the Company's Series B Preferred Stock at $162 per share held by Ms. Roberts pursuant to the Company's right to repurchase such shares pursuant to the 2004 Restricted Stock Incentive Plan. After such repurchase, Ms. Roberts will retain four shares of the Series B Preferred Stock and will be entitled to continue participation in the Company's medical, dental and basic life insurance plans through March 31, 2006. Beginning April 1, 2006, Ms. Roberts may elect extended continuation coverage under such plans for a period of 18 months. Ms. Roberts is also entitled to receive outplacement services for a period of 12 months, which shall not exceed $20,000, as well as reimbursement by the Company of Ms. Robert's legal fees incurred in connection with the negotiation of the Severance and Release Agreement, which shall not to exceed $7,500. Ms. Roberts has agreed not to compete with the Company for one year.

        Richard P. Durham is a Director of the Company. On June 10, 2002, we entered into a separation agreement with Mr. Durham terminating his employment as our Chairman and Chief Executive Officer. Pursuant to the separation agreement, Mr. Durham agreed to convert an outstanding promissory note issued as payment for a portion of his shares into two promissory notes. The first note (the "Vested Secured Note"), in the principal amount of $2,430,798, related to Mr. Durham's time-vested shares and the vested portion of his performance-vesting shares. The separation agreement preserved a put option established by Mr. Durham's employment agreement with respect to his shares. For purposes of this put option, the separation agreement provides that the price per share to be paid by us is $483.13 with respect to common stock, $483.13 less any exercise price with respect to warrants, and the liquidation preference with respect to preferred stock. Mr. Durham's put option is subject to any financing or other restrictive covenants to which we are subject at the time of the proposed repurchase. Restrictive covenants under our existing credit facilities limit the number of shares we can currently repurchase from Mr. Durham. As of December 31, 2004, our total remaining purchase obligation to Mr. Durham was approximately $10,623,097, excluding accrued preferred dividends.

2004 Restricted Stock Incentive Plan and Series B Preferred Stock

        On September 24, 2004, we adopted a 2004 Restricted Stock Incentive Plan, pursuant to which we sold to our President and Chief Executive Officer and selected additional officers of the Company, 704 shares of a total of 720 shares of a newly-created, non-voting Series B Redeemable Preferred Stock for a cash purchase price of $162 per share. These shares were issued in private transactions with officers of the Company and therefore were exempt from the registration requirements of the Securities Act of 1933. On December 22, 2004, the remaining 16 authorized shares were issued to an officer for a cash purchase price of $162 per share.

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        Upon the sale of all or substantially all of the Company's assets, sale of the majority of the outstanding Common Stock of the Company to a person other than J.P. Morgan or its affiliates; merger or consolidation of the Company, or the consummation of a liquidation, as those events are specifically described in the Company's Articles of Incorporation, we are required to redeem all shares of Series B Redeemable Preferred Stock by payment of cash in an amount equal to the product of (x) .000104166; times (y) the sum of the amount of cash distributions actually paid and the fair market value of assets distributed by the Company to its stockholders during the period commencing on September 24, 2004 through the date of such event, plus the net proceeds payable, whether in cash, stock or other assets, to the stockholders of the Company in respect of such event.

        Upon a redemption by the Company of any shares of Series A Preferred Stock (or any payment on any notes issued in exchange therefor), the holder of each share of Series B Redeemable Preferred Stock shall be entitled to receive a cash dividend equal to the product of (x) .000104166; times (y) the net proceeds payable, whether in cash, stock or other assets, to the stockholders of the Company in respect to such redemption or such payment.

        Upon an underwritten public offering of shares of capital stock of the Company to the public resulting in aggregate net proceeds to the Company of not less than $100 million each share of Series B Redeemable Preferred Stock shall be automatically converted into that number of shares of the class of common equity securities of the Company that are outstanding immediately following such public offering equal to the product of (x) .000104166; times (y) the total number of shares of such class of stock outstanding immediately following the consummation of the public offering. The shares of Series B Redeemable Preferred Stock are non-voting and do not bear dividends except as noted above.

Transactions Between Pliant and Stockholders

Common Stock Registration Rights Agreement

        Pursuant to a registration rights agreement entered into on May 31, 2000, as amended, we granted to our institutional common stockholders and warrant holders certain "demand" and "piggyback" registration rights for the registration under the Securities Act of the shares of common stock owned by them. Under the registration rights agreement, upon request of holders holding in excess of 50% of the shares of common stock held by our institutional investors and their transferees and affiliates (the "Requisite Investor Stockholders"), we are required to use our best efforts to register the shares. The Requisite Investor Stockholders are entitled to request two demand registrations. Also, if we are not a public company or sold to a third party prior to May 31, 2005, the Trust and its transferees and affiliates will be entitled to request one demand registration. Further, at any time 60 days after any initial public offering of common stock, holders holding in excess of 60% of the shares of common stock underlying our warrants to purchase common stock issued in connection with our preferred stock, and holders holding in excess of 60% of the shares of common stock underlying the note warrants will each be entitled to exercise one demand registration. At any time after we have qualified for use of Form S-3, all parties to the registration rights agreement will have the right to request that we effect a registration under the Securities Act of their shares of common stock, subject to customary "blackout" and "cutback" provisions. The stockholders and holders of the warrants to purchase common stock issued in connection with our preferred stock, and note warrants party to the registration rights agreement also may request that we use our best efforts to register shares of common stock held by them in other registrations initiated by us on our own behalf or on behalf of any other stockholder. We must pay all reasonable out-of-pocket costs and expenses, other than underwriting discounts and commissions, of any registration under the registration rights agreement. The registration rights agreement also contains customary provisions with respect to registration procedures, underwritten offerings and indemnification and contribution rights in connection with the registration of common stock on behalf of the stockholders, holders of the warrants to purchase common stock issued in

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connection with our preferred stock, and holders of the note warrants party to the registration rights agreement.

The stockholders' agreement

        A stockholders' agreement entered into on May 31, 2000, as amended, governs the exercise of voting rights by our stockholders, including holders of our warrants to purchase common stock issued in connection with our preferred stock, who exercise their warrants for common stock, with respect to the election of directors and certain other material events. The parties to the stockholders' agreement agreed initially to vote their shares of common stock to elect (i) four directors designated by the Requisite Investor Stockholders, (ii) two directors designated by the Trust and (iii) one director appointed by our board of directors, who must be a member of our senior management. At the request of the Requisite Investor Stockholders, the size of our board of directors may be increased from seven to nine. If so increased, one of the two additional directors will be designated by the Requisite Investor Stockholders and the other will be our chief executive officer.

        The provisions of the stockholders' agreement also govern:

•

restrictions on the transfer of shares of common stock and warrants to purchase common stock issued in connection with our preferred stock;



•

preemptive rights for holders of our common stock and warrants to purchase certain equity securities to be issued by us in the amounts required to maintain their percentage ownership;



•

stockholder or company rights of first refusal to purchase certain shares of our common stock to be sold by other stockholders;



•

agreement by stockholders and holders of the warrants to consent to the sale of all of, or a controlling interest in, us to a third party, if such sale is approved by our board of directors, and to sell their shares of common stock and warrants if so required;



•

rights of stockholders and holders of the warrants to participate in certain sales of the shares of our common stock by other stockholders; and



•

rights of holders of our common stock and warrants to receive certain financial and other information.

Credit facilities and note offerings

        JPMorgan Chase Bank, N.A. (formerly known as The Chase Manhattan Bank) is the syndication agent and is a lender under our revolving credit facility. JPMorgan Chase Bank, N.A. received customary fees under our revolving credit facility for acting in such capacities. J.P. Morgan Securities Inc. served as the arranger for our revolving credit facility and in connection with certain amendments to our previous credit facilities and received customary fees of approximately $0.9 million for acting in such capacity. An affiliate of JPMorgan Chase Bank received customary fees for arranging the December 2003 waiver with respect to our then existing credit facilities. In addition, JP Morgan Chase Bank, N.A. received fees of approximately $0.6 million in September 2000, approximately $0.5 million in July 2001, approximately $0.6 million in April 2002, approximately $0.6 million in October 2002, approximately $0.5 million in March 2003, approximately $0.3 million in May 2003 and approximately $0.1 million in December 2003, in connection with amendments to our then existing credit facilities.

        J.P. Morgan Securities Inc. was one of the initial purchasers in our May 2000 offering of our 13% Senior Subordinated Notes due 2010 and was also the dealer manager for the debt tender offer and consent solicitation relating to our 9¹/8% Senior Subordinated Notes due 2007. J.P. Morgan Securities Inc. received fees of approximately $8.7 million for acting in such capacities. J.P. Morgan

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Securities Inc. was also one of the initial purchasers in our April 2002 offering of our 13% Senior Subordinated Notes due 2010 and received fees of approximately $1.9 million for acting in such capacity. We used approximately $93.3 million of the net proceeds from the April 2002 offering to repay indebtedness under our then existing credit facilities. J.P. Morgan Securities Inc. was an initial purchaser in our May 2003 offering of 11¹/8% Senior Secured Notes due 2009 and received fees of approximately $4.4 million for acting in such capacity. We used approximately $240 million of the net proceeds from the May 2003 offering to repay indebtedness under our then existing credit facilities. J.P. Morgan Securities Inc. was an initial purchaser in our February 2004 offering of 11¹/8% Senior Secured Discount Notes due 2009 and received fees of approximately $2.5 million for acting in such capacity. We used the proceeds of this February 2004 offering to repay and terminate then existing credit facilities.

        On May 6, 2005, we completed a consent solicitation relating to our 11¹/8% Senior Secured Discount Notes due 2009. J.P. Morgan Securities Inc. served as the solicitation agent for the consent solicitation and received fees of approximately $1.4 million, for acting in such capacity.

        Each of JPMorgan Chase Bank, N.A., J.P. Morgan Chase & Co. and J.P. Morgan Securities Inc. is an affiliate of Southwest Industrial Films, LLC, which owns approximately 55% of our outstanding common stock and currently has the right under the stockholders' agreement to appoint four of our directors, and of Flexible Films, LLC, which, together with affiliates, owns approximately 59% of our outstanding preferred stock, subject to certain preemptive rights with respect to 10,000 shares of preferred stock issued on March 25, 2003. Southwest Industrial Films, LLC and Flexible Films, LLC are subsidiaries of J.P. Morgan Partners (BHCA), L.P. Timothy J. Walsh and Jeffrey Walker, who serve on our board of directors, are partners of J.P. Morgan Partners, LLC and Sean Epps who also serves on our board of directors is a principal of J.P. Morgan Partners, LLC. J.P. Morgan Partners, LLC serves as investment advisor to J.P. Morgan Partners (BHCA), L.P. and JPMP Capital Corp. JPMP Capital Corp. is a subsidiary of J.P. Morgan Chase & Co. and is the general partner JPMP Master Fund Manager, L.P., which is the general partner of J.P. Morgan Partners (BHCA), L.P. Messr. Walsh and Walker are executive officers of JPMP Capital Corp. and a limited partner of JPMP Master Fund Manager, L.P.

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DESCRIPTION OF CREDIT FACILITIES AND OTHER INDEBTEDNESS

        The following summary of the material terms and provisions of our revolving credit facility is less complete than the actual documentation for our revolving credit facility, the 2000/2002 Notes and the 2003 Notes and is qualified in its entirety by reference to all of the provisions of the definitive documentation for our revolving credit facility, the 2000/2002 Notes and the 2003 Notes, copies of which have been filed or incorporated by reference as exhibits to the registration statement of which this prospectus forms a part.

Revolving credit facility

        On February 17, 2004, we entered into a revolving credit facility with a syndicate of lenders which was arranged by J.P. Morgan Securities Inc. and Credit Suisse First Boston, acting through its Cayman Islands Branch. Under the revolving credit facility, have been provided, subject to the terms and conditions set forth in the credit agreement, with a $100 million senior secured asset-based revolving credit facility. Credit Suisse First Boston, acting through its Cayman Islands Branch, LaSalle Business Credit LLC, JPMorgan Chase Bank, N.A. and General Electric Capital Corporation are lenders under the facility, Credit Suisse First Boston, acting through its Cayman Islands Branch, is administrative agent and documentation agent, General Electric Capital Corporation is collateral agent and JPMorgan Chase Bank is syndication agent.

Structure and availability

        The total amount of the facility is $100 million, a portion of which may be made available to one or more of our domestic subsidiaries and a portion of which may be made available to one of our Canadian subsidiaries, available on a fully revolving basis with a $15 million sublimit for letters of credit and a $5 million swingline facility. Availability under the revolving credit facility is subject to a borrowing base consisting of eligible accounts receivable and eligible inventory of the Company, its wholly-owned domestic subsidiaries and the Canadian subsidiary borrower. In addition, if we do not maintain a specified fixed charge coverage ratio (with which we are currently in compliance), the availability under our revolving credit facility will be limited such that the total amount of our outstanding loans and letter of credit exposure under the facility may not exceed 75% of the lesser of the total amount of commitments under the facility and the borrowing base then in effect. The revolving credit facility matures on February 17, 2009.

Interest

        The interest rates will be, at the option of the Company, Adjusted LIBOR or ABR plus, in each case, a spread based upon the availability under the facility on each day (calculated as the baseline commitment amount for such day less the aggregate revolving exposure on such day). The spread will not exceed 2.75% for Adjusted LIBOR or 1.75% for ABR. Adjusted LIBOR is determined by reference to the British Bankers' Association Interest Settlement Rates for deposits in dollars adjusted for statutory reserves. ABR is the alternate base rate, which is the higher of the lender's prime rate or the federal funds effective rate plus ¹/2 of 1%. The calculation of interest is 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.

Fees

        We will pay certain fees with respect to the facility, including a 0.50% commitment fee on the undrawn portion of the commitment of each lender in respect of the facility, commencing to accrue on the closing date (treating swingline loans as undrawn) and payable quarterly in arrears after the closing

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date and at maturity or upon the earlier termination of the facility commitments (in each case computed on the basis of the actual number of days elapsed over a 360-day year).

        We will also pay a letter of credit fee which will be a per annum fee equal to the spread over Adjusted LIBOR from time to time in effect with respect to loans under the facility that will accrue on the aggregate face amount of outstanding letters of credit under the facility, payable in arrears at the end of each quarter and upon the termination of the facility, in each case for the actual number of days elapsed over a 360-day year. Such fees shall be distributed to the lenders participating in the facility pro rata in accordance with the amount of each such lender's commitment. In addition, the Company shall pay to each issuer of a letter of credit, for its own account (a) a fronting fee in an amount to be agreed upon between the Company and the applicable issuer on the aggregate face amount of outstanding letters of credit, payable in arrears at the end of each quarter and upon the termination of the facility, in each case for actual number of days elapsed over a 360-day year, and (b) such issuer's customary issuing and administering fees and expenses.

Guarantees, security and intercreditor agreement

        All obligations under the revolving credit facility are guaranteed by each of the Company's existing and subsequently acquired or organized domestic subsidiaries and by the Canadian subsidiary borrower. The obligations under the facility are secured by a first-priority security interest in the Second-Priority Collateral, and a second-priority security interest in the First-Priority Collateral.

        The collateral agent under the revolving credit facility entered into an intercreditor agreement with the trustee for the holders of the Senior Secured Discount Notes and the trustee for the holders of the 2003 Notes, which provided for the relative priorities (and certain access and other rights) of the lenders, the holders of the Senior Secured Discount Notes and the holders of the 2003 Notes in respect of the collateral. For a description of the terms of the intercreditor agreement, see "Description of Senior Secured Discount Notes—Intercreditor agreement."

Affirmative covenants

        The credit agreement contains a number of affirmative covenants including, among others, covenants relating to:

•

conduct of business and maintenance of corporate existence and rights;



•

delivery of audited annual consolidated financial statements for the Company and unaudited quarterly consolidated financial statements for the Company and other financial information;



•

delivery of notices of ratings changes, default, litigation and material adverse change in the business, operations, properties, assets, condition (financial or otherwise) or contingent or other liabilities of the Company and its subsidiaries, taken as a whole;



•

maintenance of properties and licenses; maintenance of satisfactory insurance; compliance with laws and regulations; inspection of books and properties and appraisal and collateral reviews with respect to the borrowing base calculations and the collateral underlying the borrowing base;



•

further assurances; payment of taxes and other obligations;



•

use of proceeds; and



•

maintenance of collateral and compliance with terms of leases with respect to locations at which inventory and receivables are located.

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Negative covenants

        The credit agreement contains a number of negative covenants including, among others:

•

limitations on dividends, redemptions and repurchases of capital stock;



•

limitations on prepayments, redemptions and repurchases of debt and voluntary payments of interest in cash;



•

limitations on liens and sale-leaseback transactions;



•

limitations on loans and investments;



•

limitations on debt;



•

limitations on swap agreements;



•

limitations on mergers and asset sales;



•

limitations on transactions with affiliates;



•

limitations on changes in business conducted by the Company and its subsidiaries;



•

limitation on changes in fiscal year;



•

limitations on restrictive agreements with respect to subsidiaries;



•

limitations on designated senior debt and first-priority debt;



•

limitations on the amendment of certain debt instruments; and



•

limitations on cash held by non-guarantor foreign subsidiaries.

        The negative covenants under the revolving credit facility prevent us from electing to pay cash interest in respect of the Senior Secured Discount Notes for 18 months from the closing of the facility, and then only if we have met a minimum fixed charge coverage ratio. This negative covenant may prevent us from ever electing to make cash payments in respect of the Senior Secured Discount Notes prior to December 15, 2006.

Mandatory prepayments

        If at any time the aggregate amount of our outstanding loans and letter of credit exposure under our revolving credit facility exceeds the total amount of commitments under the facility or the borrowing base in effect at that time, we will be required to prepay outstanding loans and cash collateralize letters of credit to the extent of such excess. During any period in which we have not maintained a specified fixed charge coverage ratio such that the aggregate amount of our outstanding loans and letter of credit exposure is limited to 75% of the lesser of the total amount of the commitments under the facility and the borrowing base then in effect (as described under "—Structure and availability" above), we will be required to prepay outstanding loans and cash collateralize letters of credit to the extent necessary to comply with this availability threshold.

        In addition, if the amount of cash held by us and our subsidiaries that are guarantors under the revolving credit facility exceeds a specified amount, we will be required to repay outstanding loans to the extent of such excess. Further, if we do not maintain at least $35 million of unused availability under our revolving credit facility, then each day we will be required, subject to certain exceptions, to cause all cash generated by the Company and the note guarantors to be transferred to a collection account maintained by the administrative agent under the facility, and all such cash will be used to reduce exposure under the facility.

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Events of default

        The credit agreement contains customary events of default, including, without limitation: nonpayment of principal or interest, violation of covenants, material incorrectness of representations and warranties, cross default and cross acceleration of material indebtedness, bankruptcy, material judgments, ERISA, actual or asserted invalidity of security documents (including the intercreditor agreement), guarantees or the subordination provisions of other indebtedness and change in control.

11⁵/8% Senior Secured Notes due 2009 (the "Amended 2004 Notes")

        On May 6, 2005, we completed the consent solicitation to relating to our Senior Secured Discount Notes. The 2004 Notes were amended to create the Amended 2004 Notes. The Amended 2004 Notes (i) eliminate the requirement to pay cash interest on the notes beginning in 2007 and, in lieu thereof, pay non-cash interest in the form of additional notes through maturity; (ii) increase the redemption prices of the amended notes; and (iii) increase the interest rate of the notes from 11¹/8% per annum to 11⁵/8% per annum. The amended and restated indenture governs both the Amended 2004 Notes and the Senior Secured Discount Notes (described below) and contains covenants and events of default that are substantially similar to those contained in the indenture described below which previously governed the Senior Secured Discount Notes. However, the covenants in the amended and restated indenture are only applicable to the Amended 2004 Notes.

        The amended and restated indenture contains covenants that among other things, restrict our ability and the ability of our restricted subsidiaries to: incur more indebtedness, including guarantees; create liens; pay dividends and make distributions in respect of our capital stock; enter into agreements that restrict our subsidiaries' ability to pay dividends or make distributions; redeem or repurchase our capital stock; sell assets; issue or sell stock of restricted subsidiaries; make investments or other restricted payments; enter into transactions with affiliates; and merge or consolidate.

        The covenants are subject to a number of important exceptions. In addition, the amended and restated indenture contains events of default that are substantially similar to those contained in the indenture governing the 2000/2002 Notes and the 2003 Notes.

13% Senior Subordinated Notes due 2010 (the "2000/2002 Notes")

        We issued $220 million aggregate principal amount of 13% Senior Subordinated Notes due 2010 in May 2000 to finance in part our recapitalization. We subsequently issued $100 million aggregate principal amount of 2000/2002 Notes in April 2002, the proceeds of which were primarily used to prepay a portion of the loans under our then existing credit facilities. The 2000/2002 Notes are guaranteed by the same domestic subsidiaries that guarantee the Senior Secured Discount Notes. The 2000/2002 Notes were issued under an indenture dated May 31, 2000, among us, the subsidiary guarantors party thereto and The Bank of New York, as trustee, and are treated as a single class of securities.

        The $320 million aggregate principal amount of 2000/2002 Notes are senior subordinated unsecured obligations ranking junior in right of payment to all of our existing and future senior debt, including the Senior Secured Discount Notes, and liabilities of our subsidiaries that do not guarantee the Senior Secured Discount Notes. In the event of liquidation, bankruptcy, insolvency or similar events, holders of senior debt, such as the lenders under our revolving credit facility and holders of the Senior Secured Discount Notes, are entitled to receive payment in full in cash or cash equivalents before holders of the 2000/2002 Notes are entitled to receive any payments. No payments may be made on the 2000/2002 Notes if we default on the payment of senior debt, and payments on the 2000/2002 Notes may be blocked for up to 180 days if we default on the senior debt in some other way until such default is cured or waived. Interest on the 2000/2002 Notes is payable at the rate of 13% per annum

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and is payable semi-annually in cash on each June 1 and December 1. The 2000/2002 Notes due 2010 will mature on June 1, 2010.

        Prior to June 1, 2003, we may, on one or more occasions, redeem up to a maximum of 35% of the original aggregate principal amount of the 2000/2002 Notes due 2010 with the net cash proceeds of one or more equity offerings by us at a redemption price equal to 113% of the principal amount thereof, plus accrued and unpaid interest. Otherwise, we may not redeem the 2000/2002 Notes prior to June 1, 2005. On or after that date, we may redeem the 2000/2002 Notes in whole or in part from time to time at the following redemption price (expressed as percentages of the principal amount) if redeemed during the twelve-month period commencing on June 1 of the year set forth below, plus, in each case, accrued and unpaid interest, if any, to the date of redemption:

Year	Percentage
2005	106.500	%
2006	104.333	%
2007	102.167	%
2008 and thereafter	100.000	%

        The indenture governing the 2000/2002 Notes contains covenants that restrict our ability and the ability of our restricted subsidiaries to:

•

incur more indebtedness, including guarantees;



•

create liens;



•

pay dividends and make distributions in respect of our capital stock;



•

enter into agreements that restrict our subsidiaries' ability to pay dividends or make distributions;



•

redeem or repurchase our capital stock;



•

make investments or other restricted payments;



•

sell assets;



•

issue or sell stock of restricted subsidiaries;



•

enter into transactions with affiliates;



•

merge or consolidate; and



•

incur senior subordinated indebtedness.

        These covenants are subject to a number of important exceptions. In addition, the indenture governing the 2000/2002 Notes contains events of default that are substantially similar to those contained in the indenture governing the Senior Secured Discount Notes.

11¹/8% Senior Secured Notes due 2009 (the "2003 Notes")

        We issued $250 million aggregate principal amount of 11¹/8% Senior Secured Notes due 2009 in May 2003, the net proceeds of which were used to repay a portion of the outstanding borrowings under our then existing credit facilities. The 2003 Notes are guaranteed by the same domestic subsidiaries that guarantee the Senior Secured Discount Notes. The 2003 Notes were issued under an indenture dated May 30, 2003, among us, the subsidiary guarantors party thereto and Wilmington Trust Company, as trustee.

        The 2003 Notes are senior secured obligations, rank equally in right of payment to all existing and future senior indebtedness, have the benefit of a second-priority security interest in the First-Priority

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Collateral and the Second-Priority Collateral, and rank senior in right of payment with all existing and future subordinated obligations. The 2003 Notes due 2009 effectively rank junior in right of payment to liabilities of our subsidiaries that do not guarantee the 2003 Notes. In the event of liquidation, bankruptcy, insolvency or similar events, holders of the Senior Secured Discount Notes are entitled to receive payment in full in cash or cash equivalents, to the extent of the value of the First-Priority Collateral, before holders of the 2003 Notes are entitled to receive payments. The 2003 Notes will mature on September 1, 2009. Interest on the 2003 Notes is payable at the rate of 11¹/8% per annum and is payable semi-annually in cash on each March 1 and September 1.

        Prior to June 1, 2006, we may, on one or more occasions, redeem up to a maximum of 35% of the original aggregate principal amount of the 2003 Notes with net cash proceeds of one or more equity offerings by us at a redemption price equal to 111.125% of the principal amount thereof, plus accrued and unpaid interest. Otherwise, we may not redeem the 2003 Notes prior to June 1, 2007. On or after that date, we may redeem the 2003 Notes from time to time at the following redemption prices (expressed as percentages of principal amount) if redeemed during the twelve-month period commencing on June 1 of the year set forth below, plus, in each case, accrued and unpaid interest, to the date of redemption:

Year	Percentage
2007	105.563	%
2008	102.781	%
2009	100.000	%

        The indenture governing the 2003 Notes contains covenants that, among other things, restrict our ability and the ability of our restricted subsidiaries to: incur more indebtedness, including guarantees; create liens; pay dividends and make distributions in respect of our capital stock; enter into agreements that restrict our subsidiaries' ability to pay dividends or make distributions; redeem or repurchase our capital stock; sell assets; issue or sell stock of restricted subsidiaries; make investments or other restricted payments; enter into transactions with affiliates; and merge or consolidate.

        These covenants are subject to a number of important exceptions. In addition, the indenture governing the 2003 Notes contains events of default that are substantially similar to those contained in the indenture governing the Senior Secured Discount Notes.

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DESCRIPTION OF SENIOR SECURED DISCOUNT NOTES

        On February 17, 2004, we issued $306,000,000 aggregate principal amount at maturity of Senior Secured Discount Notes under an indenture dated February 17, 2004, among us, the guarantors and Wilmington Trust Company, as trustee. On April 8, 2005, we commenced a consent solicitation relating to the Senior Secured Discount Notes seeking consents, among other things, to (i) eliminate the current requirement to pay cash interest on the notes beginning in 2007 and, in lieu thereof, pay non-cash interest in the form of Additional Securities through maturity and (ii) increase the interest rate from 11¹/8% to 11⁵/8% and increase redemption prices of the notes for which consents were received. On May 6, 2005, we consummated this solicitation as consents to the proposed amendments to the Indenture were delivered with respect to $298,200,000 aggregate principal amount at maturity of the Senior Secured Discount Notes. The notes for which consents were received are referred to in the Indenture as the "Consenting Securities" and the remaining notes for which consents were not received are referred to in the Indenture as the "Non-Consenting Securities" and are referred to in this description as the "Senior Secured Discount Notes." The Consenting Securities and the Non-Consenting Securities are collectively referred to in the Indenture as the "Securities."

        Effective May 6, 2005, the terms of the Indenture governing the remaining $7,800,000 aggregate principal amount at maturity of the Senior Secured Discount Notes were amended to eliminate substantially all of the restrictive covenants contained in the Indenture as they relate to the Senior Secured Discount Notes. The terms of the Senior Secured Discount Notes include those expressly set forth in the Indenture as amended and those made part of the Indenture by reference to the Trust Indenture Act of 1939, as amended, (the "Trust Indenture Act"). The Indenture is unlimited in aggregate principal amount, and we may issue an unlimited principal amount of additional Consenting Securities having identical terms and conditions as the Consenting Securities (the "Additional Securities"). We will only be permitted to issue such Additional Securities if at the time of such issuance, we were in compliance with the covenants contained in the Indenture. Any Additional Securities will vote on all matters with the holders of the Securities.

        This description of Senior Secured Discount Notes is intended to be a useful overview of the material provisions of the Indenture as it relates to the Senior Secured Discount Notes, the Note Guarantees and the Indenture. Since this description is only a summary, you should refer to the Indenture for a complete description of the obligations of the Company, the guarantors and your rights. The Indenture, and not this description, governs your rights as holders.

        You will find the definitions of capitalized terms used in this description under the heading "Certain definitions." For purposes of the description, references to "the Company," "we," "our," and "us" refer only to Pliant Corporation and not to its Subsidiaries, and references to the "Senior Secured Discount Notes" refer to the Non-Consenting Securities specifically, and references to the "Securities" refer to the Senior Secured Discount Notes and the Consenting Securities collectively.

Overview of the Senior Secured Discount Notes and the note guarantees

The Senior Secured Discount notes

        The Senior Secured Discount Notes:

•

are senior secured obligations of the Company;



•

rank pari passu with the Consenting Securities;



•

are secured by first-priority security interests in the First-Priority Collateral, which consists of substantially all the real property, fixtures, equipment, intellectual property and all other assets, other than Second-Priority Collateral, of the Company and the Note Guarantors, together with the proceeds therefrom and improvements, alterations and repairs thereto, as well as any assets

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required to be added to the First-Priority Collateral pursuant to the terms of the Indenture or the Security Documents, subject to certain exceptions as more fully described under "—Security" below;

•

are secured by second-priority security interests in the Second-Priority Collateral, which consists of substantially all inventory, receivables, deposit accounts, 100% of the capital stock of, or other equity interests in, existing and future Domestic Subsidiaries and Foreign Subsidiaries that are Note Guarantors, and 65% of the capital stock of, or other equity interests in, existing and future first-tier Foreign Subsidiaries (other than Foreign Subsidiaries that are Note Guarantors), investment property and certain other assets of the Company and the Note Guarantors, all of which will secure the Credit Agreement Obligations and the Secondary Collateral Obligations, together with the proceeds therefrom, subject to certain exceptions as more fully described under "—Security" below;



•

rank equally in right of payment with all existing and any future Senior Indebtedness of the Company;



•

are senior in right of payment to all existing and any future Subordinated Obligations of the Company; and



•

are effectively subordinated to all liabilities (including Trade Payables) and Preferred Stock of each Subsidiary of the Company that is not a Note Guarantor.

The note guarantors

        The Senior Secured Discount Notes are guaranteed by each of the Domestic Subsidiaries of the Company, which currently consist of:

•

Pliant Corporation International;



•

Pliant Film Products of Mexico, Inc.;



•

Pliant Solutions Corporation;



•

Pliant Packaging of Canada, LLC;



•

Uniplast Holdings Inc.; and



•

Uniplast U.S., Inc.

        On August 12, 2004 Turex, Inc., Pierson Industries, Inc. and Uniplast Midwest, Inc. merged into Uniplast U.S., Inc. The Senior Secured Discount Notes are also guaranteed by each Foreign Subsidiary that guarantees Indebtedness of the Company or any domestic Subsidiary (including Bank Indebtedness), which currently consists of:

•

Uniplast Industries Co.

        The Senior Secured Discount Notes are not guaranteed by any other Foreign Subsidiaries of the Company. The Foreign Subsidiaries of the Company which are not Note Guarantors currently consist of the following:

•

Aspen Industrial S.A. de C.V.;



•

Pliant Corporation of Canada Ltd.;



•

Pliant Film Products GmbH;



•

Pliant Corporation Pty, Ltd.;



•

Pliant Corporation Asia & Pacific Rim Pte Ltd.;

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•

Jacinto Mexico S.A. de C.V.;



•

Pliant de Mexico S.A. de C.V.; (f/k/a "Nepsa de Mexico S.A. de C.V."); and



•

Uniplast Films, Inc.

        The Senior Secured Discount Notes are not guaranteed by Pliant Investment Inc., which is a domestic Unrestricted Subsidiary and owns 100% of the membership interest in Alliant Company LLC.

        The Subsidiaries that are not Note Guarantors generated 12.9% of the Company's net sales for the three months ended March 31, 2005, and accounted for 10.5% of the assets of the Company and its Subsidiaries on a consolidated basis as of March 31, 2005.

The note guarantees

        The Note Guarantee of each Note Guarantor and all Note Guarantees, if any, made by future Restricted Subsidiaries of the Company:

•

will be senior secured obligations of the applicable Note Guarantor;



•

will be secured by a first-priority security interest in the First-Priority Collateral of the applicable Note Guarantor, subject to the exceptions under the heading "—Security" below;



•

will be secured by a second-priority security interest in the Second-Priority Collateral of the applicable Note Guarantor, subject to the exceptions under the heading "—Security" below;



•

will rank equally in right of payment with all existing and future Senior Indebtedness of the applicable Note Guarantor; and



•

will be senior in right of payment to all existing and future Subordinated Obligations of the applicable Note Guarantor.

Principal, maturity and interest

        The Senior Secured Discount Notes have been issued at a discount to their principal amount to generate aggregate gross proceeds to the Company of $225,298,620 ($736.27 per $1,000 principal amount of Senior Secured Discount Notes) and will mature on June 15, 2009. Unless the Company elects to pay cash interest as described below, the Senior Secured Discount Notes will accrete from the date of issuance at a rate of 11¹/8% until December 15, 2006, compounded semiannually on each June 15 and December 15 commencing June 15, 2004, to an aggregate principal amount of $1,000 per Note ($306,000,000 in the aggregate assuming no redemption or other repayments). Commencing on December 15, 2006, interest on the Senior Secured Discount Notes will accrue at the rate of 11¹/8% per annum and will be payable in cash semiannually on June 15 and December 15 (each an "Interest Payment Date"), commencing on June 15, 2007, to holders of record on the immediately preceding June 1 and December 1, respectively.

        Notwithstanding the foregoing, on any Interest Payment Date prior to December 15, 2006, the Company may elect to commence to pay cash interest (from and after such Interest Payment Date), in which case (i) the Company will be obligated to pay cash interest on each subsequent Interest Payment Date, (ii) the Senior Secured Discount Notes will cease to accrete after such Interest Payment Date and (iii) the outstanding principal amount at Stated Maturity of each Note will be equal to the Accreted Value of such Senior Secured Discount Note as of such Interest Payment Date. Except as otherwise described in the foregoing paragraph and this paragraph, cash interest on the Senior Secured Discount Notes will accrue from the most recent date to which interest has been paid or, if no interest on the Notes has been paid, from December 15, 2006. Interest and Accreted Value will be computed on the basis of a 360-day year comprised of twelve 30-day months.

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        Interest will be payable as described in the foregoing two paragraphs, except as described in "—Defaults."

Indenture may be used for future issuances

        We may issue from time to time Additional Securities having identical terms and conditions to the Consenting Notes. We will only be permitted to issue such Additional Securities if at the time of such issuance we are in compliance with the covenants contained in the Indenture and such Additional Securities will vote together on all matters with such Senior Secured Discount Notes and the Consenting Notes as a single class.

Paying agent and registrar

        We will pay the principal of, premium, if any, interest (including additional interest, if any), on the Senior Secured Discount Notes at any office of ours or any agency designated by us which is located in the Borough of Manhattan, The City of New York. We have initially designated the corporate trust office of the Trustee to act as our agent in such matters. The location of the corporate trust office is 520 Madison Avenue, 33rd Floor, New York, N.Y. 10022. We, however, reserve the right to pay interest to Holders by check mailed directly to Holders at their registered addresses. Holders may exchange or transfer their Senior Secured Discount Notes at the same location given in the preceding paragraph. No service charge will be made for any registration of transfer or exchange of Senior Secured Discount Notes.

        We may, however, require Holders to pay any transfer tax or other similar governmental charge payable in connection with any such transfer or exchange.

Optional redemption

        Except as set forth in the following paragraph, the Company may not redeem the Senior Secured Discount Notes prior to June 15, 2007. On or after that date, the Company may redeem the Senior Secured Discount Notes, in whole or in part, on not less than 30 nor more than 60 days' prior notice, at the following redemption prices (expressed as percentages of principal amount), plus accrued and unpaid interest (including additional interest, if any), to the redemption date (subject to the right of Holders of record on the relevant record date to receive interest (including additional interest, if any) due on the relevant Interest Payment Date), if redeemed during the 12-month period commencing on June 15 of the years set forth below (or, in the case of June 15, 2009, on such date):

Year	Redemption Price
2007	105.563	%
2008	102.781	%
2009	100.000	%

        Prior to June 15, 2007, the Company may, on one or more occasions, also redeem up to a maximum of 35% of the Accreted Value of the Senior Secured Discount Notes (calculated giving effect to any issuance of Additional Notes) with the Net Cash Proceeds of one or more Equity Offerings by the Company at a redemption price equal to 111.125% of the Accreted Value at the date of redemption plus accrued and unpaid interest (including additional interest, if any) thereon to the date of redemption; provided, however, that after giving effect to any such redemption:

(1)

at least 65% of the Accreted Value of the Senior Secured Discount Notes (calculated giving effect to any issuance of Additional Notes) remains outstanding; and



(2)

any such redemption by the Company must be made within 120 days of such Equity Offering and must be made in accordance with certain procedures set forth in the Indenture.

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Selection

        If we partially redeem the Senior Secured Discount Notes, the Trustee will select the Senior Secured Discount Notes to be redeemed on a pro rata basis, by lot or by such other method as the Trustee in its sole discretion shall deem to be fair and appropriate, although no Note of $1,000 in principal amount at maturity will be redeemed in part. If we redeem any Senior Secured Discount Note in part only, the notice of redemption relating to such Senior Secured Discount Note shall state the portion of the principal amount at maturity thereof to be redeemed. A new Senior Secured Discount Note in principal amount at maturity equal to the unredeemed portion thereof will be issued in the name of the Holder thereof upon cancelation of the original Senior Secured Discount Note.

Ranking

        The Senior Secured Discount Notes rank pari passu with the Consenting Notes. The Senior Secured Discount Notes are senior secured Indebtedness of the Company and effectively rank senior to our unsecured indebtedness and indebtedness secured by junior liens, other than borrowings under our revolving credit facility, and our May 2003 Notes, to the extent of the value of the First-Priority Collateral; effectively rank junior to any indebtedness secured by first-priority security interests, other than borrowings under our revolving credit facility, on the Second-Priority Collateral to the extent of the value of such Second-Priority Collateral; effectively rank pari passu with any indebtedness secured by second-priority security interests, including our May 2003 Notes, on the Second-Priority Collateral to the extent of the value of such Second-Priority Collateral; effectively rank senior to our unsecured indebtedness to the extent of the residual value of the Second-Priority Collateral; rank equally in right of payment to all existing and any future senior indebtedness of the Company; are senior in right of payment with all existing and any future subordinated obligations of the Company; and are effectively subordinated to all liabilities (including trade payables) and preferred stock of each subsidiary of the Company that is not a note guarantor. The Senior Secured Discount Notes will also have the benefit of a first-priority security interest in the First-Priority Collateral and will have the benefit of a second-priority security interest in the Second-Priority Collateral, in each case subject to the exceptions described under the heading "—Security". Pursuant to the Security Documents and the Intercreditor Agreement, the security interests in the Second-Priority Collateral securing the Senior Secured Discount Notes and the Note Guarantees under the Security Documents will be second in priority (subject to Permitted Liens) to any and all security interests at any time granted in the Second- Priority Collateral to secure Credit Agreement Obligations, which include certain Hedging Obligations and certain obligations in respect of cash management services.

        The Company currently conducts certain of its operations through its Subsidiaries. To the extent any existing or future Subsidiary does not Guarantee the Notes, creditors of such Subsidiaries, including trade creditors and preferred stockholders (if any), generally will have priority with respect to the assets and earnings of such Subsidiaries over the claims of the Company's creditors, including Holders. The Notes, therefore, are effectively subordinated to claims of creditors, including trade creditors, and preferred stockholders (if any) of Subsidiaries of the Company, including those formed or acquired in the future, that do not Guarantee the Notes. As of March 31, 2005, the Subsidiaries of the Company, other than those Subsidiaries that are Note Guarantors, had total liabilities, including trade payables, of approximately $21.1 million (excluding liabilities owed to the Company). As of March 31, 2005:

(1)

we had $552.3 million of senior debt including (i) $41.4 million of borrowings under our revolving credit facility (excluding $6.7 million of letters of credit outstanding) secured by a first-priority security interest in the Second-Priority Collateral and a second-priority security interest in the First-Priority Collateral, (ii) $250.0 million of 2003 Notes secured by a second-priority security interest in the First-Priority Collateral and the Second-Priority Collateral, (iii) $6.5 million of the 2004 Notes secured by a first-priority security interest in the First-Priority Collateral and a second-priority security interest in the Second-Priority Collateral, (iv) $248.0 million of the Amended 2004

99

Notes secured by a first-priority security interest in the First-Priority Collateral and a second-priority security interest in the Second-Priority Collateral, and (v) $6.4 million of other senior secured debt; and

(2)

we had $313.4 million principal amount of subordinated debt, consisting of our Senior Subordinated Notes.

        Subject to certain conditions, the Indenture permits us to incur substantial amounts of additional Indebtedness, including Indebtedness that may be secured by first-priority or second-priority liens on the Second-Priority Collateral and Indebtedness that may be secured by second-priority liens in the First-Priority Collateral. In addition, the outstanding May 2003 Notes constitute Senior Indebtedness and have a second-priority security interest in both the First-Priority Collateral and the Second-Priority Collateral. See "Risk Factors—There may not be sufficient collateral to pay all or any of the Senior Secured Discount Notes."

Note guarantees

        The Note Guarantors and certain future Subsidiaries of the Company (as described below), as primary obligors and not merely as sureties, jointly and severally unconditionally Guarantee on a senior secured basis the performance and full and punctual payment when due, whether at Stated Maturity, by acceleration or otherwise, of all obligations of the Company under the Indenture (including obligations to the Trustee) and the Senior Secured Discount Notes, whether for payment of principal and Accreted Value and, when applicable, interest thereon (including additional interest thereon, if any) of the Senior Secured Discount Notes, expenses, indemnification or otherwise (all such obligations guaranteed by such Note Guarantors being herein called the "Guaranteed Obligations"). Such Note Guarantors will agree to pay, in addition to the amount stated above, any and all costs and expenses (including reasonable counsel fees and expenses) incurred by the Trustee or the Holders in enforcing any rights under the Note Guarantees. Each Note Guarantee is limited to an amount not to exceed the maximum amount that can be Guaranteed by the applicable Note Guarantor without rendering the Note Guarantee, as it relates to such Note Guarantor, void or voidable under applicable law relating to fraudulent conveyance or fraudulent transfer or similar laws affecting the rights of creditors generally.

        If, after the date hereof, any domestic Restricted Subsidiary shall be formed or acquired, or if any Foreign Subsidiary shall guarantee any Indebtedness of the Company or any domestic Subsidiary, then in either case the Company shall, at the time, cause such Subsidiary to (a) execute a supplemental indenture pursuant to which such Restricted Subsidiary will Guarantee payment of the Senior Secured Discount Notes, (b) execute counterparts of the Security Documents, subject to the Intercreditor Agreement, that grant the Trustee a first-priority Lien for the benefit of the Holders on all First-Priority Assets owned by such Subsidiary, subject to the exceptions described below under the heading "—Security" and (c) if such Subsidiary grants any Lien upon any of its property constituting Second-Priority Collateral as security for any Credit Agreement Obligations or any Secondary Collateral Obligations, execute a Security Document upon substantially the same terms, but subject to the Intercreditor Agreement, that grants the Trustee a second-priority Lien upon such property for the benefit of the Holders, subject to the exceptions described below under the heading "—Security." Further, if granting the Lien described in clause (c) above requires the consent of a third party, such Subsidiary will use commercially reasonable efforts to obtain such consent with respect to the second-priority Lien, for the benefit of the Trustee, but if the third party does not consent to the granting of the second-priority Lien, after the use of commercially reasonable efforts, such Subsidiary will not be required to do so. Also, if a Lien described in clause (b) or (c) cannot be granted or perfected under applicable law, the Subsidiary will not be required to grant such Lien.

        Each Note Guarantee is a continuing guarantee and shall (a) remain in full force and effect until payment in full of all the Guaranteed Obligations, (b) be binding upon each Note Guarantor and its

100

successors and (c) inure to the benefit of, and be enforceable by, the Trustee, the Holders and their successors, transferees and assigns.

        Notwithstanding the foregoing, a Note Guarantee of the Senior Secured Discount Notes provided by a Note Guarantor will be released without any action required on the part of the Trustee or any Holder:

(1)

if the Note Guarantor is a Foreign Subsidiary and it does not guarantee any Indebtedness of the Company or any domestic Subsidiary; or



(2)

if (a) all of the capital stock of, or other equity interests in, or all or substantially all of the assets of such Note Guarantor is sold or otherwise disposed of (including by way of merger or consolidation) to a Person other than the Company or another Note Guarantor (provided that such Note Guarantor does not continue to guarantee any Indebtedness of the Company or any domestic Subsidiary) or (b) such Note Guarantor ceases to be a Restricted Subsidiary, and the Company otherwise complies, to the extent applicable, with the covenants described below under the caption "—Certain covenants—Merger and consolidation"; or



(3)

if the Company designates such Note Guarantor as an Unrestricted Subsidiary (unless any of the First-Priority Collateral is then owned by such Note Guarantor).

        At our request, the Trustee will execute and deliver any instrument evidencing such release. A Note Guarantor may also be released from its obligations under its Note Guarantee in connection with a permitted amendment. See "—Amendments and waivers."

Security

        The Senior Secured Discount Notes have the benefit of the Collateral, which will consist of (i) the First-Priority Collateral, as to which the Senior Secured Discount Notes Obligations (and any Other First-Priority Obligations) have a first-priority security interest and the Second-Priority Obligations (including in respect of Credit Agreement Obligations and the May 2003 Notes) have a second-priority security interest (in each case subject to Permitted Liens) and (ii) the Second-Priority Collateral, as to which the Senior Secured Discount Notes Obligations and the Secondary Collateral Obligations have a second-priority security interest and the Credit Agreement Obligations have a first-priority security interest (in each case subject to Permitted Liens).

        The Company, the Note Guarantors and the Trustee have entered into one or more security agreements, pledge agreements, mortgages, deeds of trust and collateral assignments (collectively, the "Security Documents") defining the terms of the security interests that secure the Senior Secured Discount Notes. These security interests secure the payment and performance when due of all of the obligations of the Company and the Note Guarantors under the Senior Secured Discount Notes, the Indenture, the Note Guarantees and the Security Documents, as provided in the Security Documents.

First-Priority Collateral

        The Senior Secured Discount Notes are secured by a first-priority security interest (subject to Permitted Liens) in the First-Priority Collateral. The First-Priority Collateral consists of substantially all the real property, fixtures, equipment, intellectual property and all other assets, other than Second-Priority Collateral, of the Company and the Note Guarantors, together with the proceeds therefrom and improvements, alterations and repairs thereto, as well as any assets required to be added to the First-Priority Collateral pursuant to the terms of the Indenture or the Security Documents. However, the First-Priority Collateral will not include any inventory, receivables, deposit accounts, the capital stock of, or other equity interests in, subsidiaries, investment property and certain other assets of the Company and the Note Guarantors, all of which will constitute Second-Priority Collateral.

101

        Initially, only the Senior Secured Discount Notes and the Consenting Securities have the benefit of the first-priority security interest in the First-Priority Collateral (subject to Permitted Liens). Except with respect to certain Permitted Liens, no other Indebtedness incurred by the Company may be granted a first-priority security interest in the First-Priority Collateral; provided, however, that if the Company Refinances some (but not all) of the Senior Secured Discount Notes or the Consenting Securities, the Indebtedness Incurred to Refinance the Senior Secured Discount Notes or the Consenting Securities may be equally and ratably secured by the First-Priority Collateral and share a first-priority security interest in the First-Priority Collateral with the Senior Secured Discount Notes and the Consenting Securities that remain outstanding. Any such additional Indebtedness will constitute Other First-Priority Obligations for purposes of the Indenture.

        The Company has granted a second-priority security interest in the First-Priority Collateral for the benefit of the Second-Priority Obligations, which will initially consist of the Credit Agreement Obligations, which include certain Hedging Obligations and certain obligations in respect of cash management services, and the May 2003 Notes Obligations. Any additional Indebtedness that is Incurred by the Company pursuant to the terms of the Indenture may also be given a second-priority security interest in the First-Priority Collateral that ranks junior to the security interest of the Senior Secured Discount Notes in the First-Priority Collateral. Any such additional Indebtedness will constitute Second-Priority Obligations for purposes of the Indenture.

        The Company will be entitled to releases of assets included in the First-Priority Collateral from the Liens securing the Senior Secured Discount Notes under any one or more of the following circumstances:

(1)

to enable us to consummate asset dispositions;



(2)

if any Subsidiary that is a Note Guarantor is released from its Note Guarantee, that Subsidiary's assets will also be released; or



(3)

as described under "—Amendments and waivers" below.

        The first-priority security interests in the First-Priority Collateral also will be released upon (i) payment in full of the Accreted Value or principal of, accrued and unpaid interest (including additional interest, if any) on the Senior Secured Discount Notes and all other obligations under the Indenture, the Note Guarantees and the Security Documents that are due and payable at or prior to the time such Accreted Value, principal, accrued and unpaid interest (including additional interest, if any) are paid, (ii) a satisfaction and discharge of the Indenture or (iii) a legal defeasance or covenant defeasance as described below under the heading "—Defeasance."

Second-Priority Collateral

        The Senior Secured Discount Notes and the Consenting Securities are secured by a second-priority security interest (subject to Permitted Liens) in the Second-Priority Collateral. The Second-Priority Collateral is also be subject to a second-priority security interest for the benefit of the holders of the May 2003 Notes and any future Secondary Collateral Obligations, which security interest will rank equally and ratably with the Holders' security interest in the Second-Priority Collateral. The Second-Priority Collateral consists of substantially all the inventory, receivables, deposit accounts, 100% of the capital stock of, or other equity interests in, existing and future Domestic Subsidiaries and Foreign Subsidiaries that are Note Guarantors, and 65% of the capital stock of, or other equity interests in, existing and future first-tier Foreign Subsidiaries (other than Foreign Subsidiaries that are Note Guarantors) (subject to the limitation described in the last sentence of this paragraph), investment property, business interruption insurance proceeds relating to the first 45 days of a covered period and certain other assets, in each case that are held by the Company or any of the Note Guarantors to the extent that a second-priority security interest is able to be granted or perfected therein (but in each

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case only to the extent that Credit Agreement Obligations are secured by a first-priority lien thereon or Secondary Collateral Obligations are secured by a second-priority lien thereon). The Second-Priority Collateral is comprised of substantially all of the material collateral (other than First Priority Collateral) of the Company and the Note Guarantors securing Credit Agreement Obligations. Any security interest in any capital stock or other securities of any Subsidiary shall be limited at any time to that portion of capital stock or other security which value (defined as the principal amount, par value, book value as carried by the Company or market value, whichever is greatest), when considered in the aggregate with all other capital stock or other securities of such Subsidiary subject to a security interest under the Indenture, does not exceed 19.99% of the principal amount of the then outstanding Senior Secured Discount Notes issued by the Company; provided, in the event that Rule 3-16 of Regulation S-X under the Securities Act is amended, modified or interpreted by the SEC to require (or is replaced with another rule or regulation or any other law, rule or regulation is adopted, which would require) the filing with the SEC (or any other governmental agency) of separate financial statements of any Subsidiary of the Company due to the fact that such Subsidiary's capital stock or other securities secure the Senior Secured Discount Notes, then the capital stock or other securities of such Subsidiary shall automatically be deemed not to be part of the Collateral but only to the extent necessary to not be subject to such requirement; provided, further in such event, the Security Documents may be amended or modified, without the consent of any Holder of Senior Secured Discount Notes, to the extent necessary to release the second-priority security interests on the shares of capital stock or other securities that are so deemed to no longer constitute part of the Second-Priority Collateral.

        If the Company or any Note Guarantor creates any additional security interest upon any Second-Priority Collateral to secure any Credit Agreement Obligations or any Secondary Collateral Obligations, it must concurrently grant a second-priority security interest (subject to Permitted Liens) upon such property as security for the Senior Secured Discount Notes ratably with any other Secondary Collateral Obligations to be secured thereby. Also, if granting a security interest in such property requires the consent of a third party, we will use commercially reasonable efforts to obtain such consent with respect to the second-priority security interest for the benefit of the Trustee on behalf of the Holders of the Senior Secured Discount Notes. If such third party does not consent to the granting of the second-priority security interest after the use of commercially reasonable efforts, we will not be required to provide such security interest.

        Whether prior to or after the Discharge of Credit Agreement Obligations, the Company will be entitled to releases of assets included in the Second-Priority Collateral from the Liens securing the Senior Secured Discount Notes under any one or more of the following circumstances:

(1)

if all other Liens (other than Permitted Liens described in clauses (2)-(27) of the definition thereof) on that asset securing Credit Agreement Obligations or any Secondary Collateral Obligations then secured by that asset (including all commitments thereunder) are released; provided that after giving effect to the release, obligations secured by the first-priority Liens on the remaining Second-Priority Collateral remain outstanding;



(2)

to enable us to consummate asset dispositions;



(3)

if all of the stock of any of our Subsidiaries that is pledged to the Trustee is released or if any Subsidiary that is a Note Guarantor is released from its Note Guarantee, that Subsidiary's assets will also be released; or



(4)

as described under "—Amendments and waivers" below.

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        The second-priority security interests of the Notes Obligations in the Second-Priority Collateral also will be released upon (i) payment in full of the Accreted Value or principal of, accrued and unpaid interest (including additional interest, if any) on the Senior Secured Discount Notes and all other obligations under the Indenture, the Note Guarantees and the Security Documents that are due and payable at or prior to the time such Accreted Value, principal, accrued and unpaid interest (including additional interest, if any) are paid, (ii) a satisfaction and discharge of the Indenture or (iii) a legal defeasance or covenant defeasance as described below under the heading "—Defeasance."

Intercreditor Agreement

        The Trustee, the Credit Agent and the May 2003 Notes Agent have entered into the Intercreditor Agreement. Pursuant to the terms of the Intercreditor Agreement, the Trustee will determine the time and method by which the security interests in the First-Priority Collateral will be enforced and, prior to the Discharge of Credit Agreement Obligations, the Credit Agent will determine the time and method by which the security interests in the Second-Priority Collateral will be enforced. The Trustee will not be permitted to enforce the security interests in the Second-Priority Collateral even if an Event of Default has occurred and the Senior Secured Discount Notes have been accelerated except (a) in any insolvency or liquidation proceeding, as necessary to file a claim or statement of interest with respect to the Senior Secured Discount Notes or (b) as necessary to take any action not adverse to the first- priority liens in respect of the Credit Agreement Obligations in order to preserve or protect its rights in the second-priority liens. The Credit Agent and the May 2003 Notes Agent will be subject to similar restrictions with respect to their ability to enforce their respective second-priority security interests in the First-Priority Collateral.

        After the Discharge of Credit Agreement Obligations, the Trustee and the May 2003 Notes Agent, in accordance with the terms of the Intercreditor Agreement, the Indenture and the Security Documents, will distribute all cash proceeds (after payment of the costs of enforcement and collateral administration) of the Second-Priority Collateral received by them under the Security Documents for the ratable benefit of the Holders of the Senior Secured Discount Notes and remaining Secondary Collateral Obligations.

        The Intercreditor Agreement also provides that, if the Trustee were to enforce any lien in respect of First-Priority Collateral and the Trustee or a purchaser at a foreclosure sale conducted in foreclosure of any such lien takes actual possession of a facility or property of the Company or a Note Guarantor, then, if so requested by the Credit Agent, the Trustee or such foreclosure purchaser will allow the Credit Agent and its officers, employees and agents reasonable and non-exclusive access to and use of such property for a specified period as necessary or reasonably appropriate for the Credit Agent to process, shop, produce, store, complete, supply, sell or otherwise dispose of, in any lawful manner, any inventory upon which the Credit Agent holds a lien, subject to the terms and conditions set forth in the Intercreditor Agreement.

        The Trustee or any such foreclosure purchaser will agree to provide reasonable cooperation to the Credit Agent in connection with the manufacture, production, completion, removal and sale of the inventory that constitutes Second-Priority Collateral and will be entitled to receive from the Credit Agent fair compensation and reimbursement for the reasonable costs and expenses incurred in connection therewith.

        In the event a bankruptcy proceeding shall be commenced by or against the Company and the Company enters into certain debtor-in-possession financings (a "DIP Financing") in such proceeding, the liens on the First-Priority Collateral and Second-Priority Collateral securing the Senior Secured Discount Notes and the Note Guarantees may, without any further action or consent by the Trustee or the Holders, be made junior and subordinated to liens granted to secure such DIP Financings, subject

104

to the right of the Trustee and the Holders to request adequate protection in connection with any such subordination.

Certain covenants

        The Indenture eliminates the following restrictive covenants and provisions with respect to the Senior Secured Discount Notes:

•

the limitation on indebtedness;



•

the limitation on restricted payments;



•

the limitation on restrictions on distributions from restricted subsidiaries and negative pledges;



•

the limitation on transactions with affiliates;



•

the limitation on sales of assets and subsidiary stock;



•

the obligation to offer to repurchase the Senior Secured Discount Notes upon a change of control;



•

the limitation on lines of business; and



•

the requirement that, in connection with any merger or consolidation of Pliant Corporation with or into, or any conveyance, transfer or lease of all or substantially all its assets to any person, the resulting, surviving or transferee person would be able to incur an additional $1.00 of debt pursuant to the fixed change coverage ratio text contained in the Existing Indenture.

        Such restrictive covenants and events of default will continue in the Indenture solely for the benefit of the Consenting Notes.

        The Indenture does contain covenants relating to the Senior Secured Discount Notes including, among others, the following:

        Limitation on Liens.    The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, assume or suffer to exist any Lien of any kind on any asset now owned or hereafter acquired by the Company or its Restricted Subsidiaries, except Permitted Liens.

        In addition, if the Company or any Note Guarantor creates any additional security interest (other than Permitted Liens described in clauses (2)-(27) of the definition thereof) upon any property (other than First-Priority Collateral) to secure any Credit Agreement Obligations or Secondary Collateral Obligations, it must concurrently grant a second-priority Lien (subject to Permitted Liens) upon such property as security for the Senior Secured Discount Notes, subject to certain exceptions and limitations, all as more fully described above in the first and second paragraphs under the heading "—Security—Second-Priority Collateral."

        SEC Reports.    Notwithstanding that the Company may not be subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act, the Company will file with the SEC (if permitted by SEC practice and applicable law and regulations) and provide the Trustee and Holders and prospective Holders (upon request) within 15 days after it files them with the SEC (or if not permitted, within 15 days after it would have otherwise been required to file them with the SEC), copies of the Company's annual report and the information, documents and other reports that are specified in Sections 13 and 15(d) of the Exchange Act. In addition, following the existence of a Public Market, the Company will furnish to the Trustee and the Holders, promptly upon their becoming available, copies of the annual report to shareholders and any other information provided by the Company to its shareholders generally. The Company also will comply with the other provisions of Section 314(a) of the TIA.

105

        Material After-Acquired Property.    Upon the acquisition by the Company or any Note Guarantor of any Material After-Acquired Property (or the formation or acquisition of any Note Guarantor that holds Material After-Acquired Property), the Company or such Note Guarantor shall execute and deliver such mortgages, deeds of trust, security instruments, financing statements and certificates and opinions of counsel as shall be reasonably necessary or requested by the Trustee to vest in the Trustee a perfected first-priority security interest (subject to Permitted Liens) in such Material After-Acquired Property and to have such Material After-Acquired Property added to the First-Priority Collateral, and thereupon all provisions of the Indenture relating to First-Priority Collateral shall be deemed to relate to such Material After-Acquired Property to the same extent and with the same force and effect.

Merger and consolidation

        The Company will not consolidate with or merge with or into, or convey, transfer or lease all or substantially all its assets to, any Person, unless:

(1)

the resulting, surviving or transferee Person (the "Successor Company") will be a corporation organized and existing under the laws of the United States of America, any State thereof or the District of Columbia and the Successor Company (if not the Company) will expressly assume, by a supplemental indenture, executed and delivered to the Trustee, in form satisfactory to the Trustee, all the obligations of the Company under the Senior Secured Discount Notes and the Indenture;



(2)

immediately after giving effect to such transaction (and treating any Indebtedness which becomes an obligation of the Successor Company or any Restricted Subsidiary as a result of such transaction as having been Incurred by the Successor Company or such Restricted Subsidiary at the time of such transaction), no Default shall have occurred and be continuing; and



(4)

the Company shall have delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, each stating that such consolidation, merger or transfer and such supplemental indenture (if any) comply with the Indenture.

        The Successor Company will succeed to, and be substituted for, and may exercise every right and power of, the Company under the Indenture, but the predecessor Company in the case of a conveyance, transfer or lease of all or substantially all its assets will not be released from the obligation to pay the Accreted Value or principal of and interest on the Senior Secured Discount Notes.

        In addition, the Company will not permit any Note Guarantor to consolidate with or merge with or into, or convey, transfer or lease all or substantially all its assets to, any Person, unless either:

(1)

(A) the resulting, surviving or transferee Person will be a corporation, partnership or limited liability company organized and existing under the laws of the United States of America, any State thereof or the District of Columbia, and such Person (if not such Note Guarantor) will expressly assume, by a supplemental indenture, executed and delivered to the Trustee, in form satisfactory to the Trustee, all the obligations of such Note Guarantor under its Note Guarantee; (B) immediately after giving effect to such transaction (and treating any Indebtedness which becomes an obligation of the resulting, surviving or transferee Person or any Restricted Subsidiary as a result of such transaction as having been Incurred by such Person or such Restricted Subsidiary at the time of such transaction), no Default shall have occurred and be continuing; and (C) the Company will have delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, each stating that such consolidation, merger or transfer and such supplemental indenture (if any) comply with the Indenture; or



(2)

such transaction results in the Company receiving cash or other property (other than Capital Stock representing a controlling interest in the successor entity).

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        Notwithstanding any of the foregoing:

(A)

any Restricted Subsidiary may consolidate with, merge into or transfer or lease all or part of its properties and assets to the Company or a Subsidiary that is a Note Guarantor, and



(B)

the Company may merge with an Affiliate incorporated solely for (i) the purpose of incorporating the Company or (ii) organizing the Company in another jurisdiction to realize tax or other benefits.

Defaults

        Each of the following is an Event of Default:

(1)

a default in any payment of interest (including additional interest, if any) on any Security when due and payable, continued for 30 days;



(2)

a default in the payment of Accreted Value or principal of any Security when due and payable at its Stated Maturity, upon required redemption or repurchase, upon declaration or otherwise;



(3)

the failure by the Company or any Restricted Subsidiary to comply for 45 days after written notice (specifying the default and demanding that the same be remedied) with any of its obligations under the covenants described under "—Certain covenants" above (in each case, other than a failure to purchase Securities);



(4)

the failure by the Company or any Restricted Subsidiary to comply for 60 days after written notice (specifying the default and demanding that the same be remedied) with its other agreements contained in the Securities, the Indenture or the Security Documents;



(5)

the failure by the Company or any Restricted Subsidiary of the Company to pay the principal amount of any Indebtedness within any applicable grace period after final maturity or the acceleration of any such Indebtedness by the holders thereof because of a default if the aggregate principal amount of such Indebtedness unpaid or accelerated exceeds $10.0 million or its foreign currency equivalent (the "cross acceleration provision") and such failure continues for 30 days after receipt of the notice specified in the Indenture;



(6)

certain events of bankruptcy, insolvency or reorganization of the Company or a Significant Subsidiary (the "bankruptcy provisions");



(7)

the rendering of any judgment or decree for the payment of money in excess of $10.0 million (net of any amounts with respect to which a reputable and creditworthy insurance company has acknowledged liability in writing) or its foreign currency equivalent against the Company, or a Restricted Subsidiary of the Company if such judgment or decree becomes final and nonappealable and remains outstanding for a period of 60 days following such judgment and is not discharged, waived or stayed (the "judgment default provision"); or



(8)

(A) any Note Guarantee, or any Security Document executed by, or any security interest granted thereunder, by a Note Guarantor that is a Material Subsidiary ceases to be in full force and effect (except as contemplated by the terms of the Indenture, the Security Documents, the Intercreditor Agreement or the Note Guarantees), except (i) as a result of (x) the Credit Agent's or Trustee's failure to take any action reasonably requested by the Company in order to maintain a valid and perfected Lien on any Collateral or (y) any action taken by the Credit Agent or the Trustee to release any Lien on any Collateral or (ii) Liens on any item of Collateral with a fair market value not exceeding $500,000, (B) any Note Guarantor or Person acting by or on behalf of such Note Guarantor denies or disaffirms such Note Guarantor's obligations under the Indenture, any Note Guarantee or any Security Document and, in each case, such Default continues for 10 days after receipt of the notice specified in the Indenture or (C) the Intercreditor Agreement ceases to be in full force and

107

effect (except as contemplated by the terms of the Indenture, the Security Documents, the Intercreditor Agreement or the Note Guarantees) (the "Note Guarantee provision").

        The foregoing will constitute Events of Default whatever the reason for any such Event of Default and whether it is voluntary or involuntary or is effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body.

        However, a default under clauses (3), (4), (5), or (8) will not constitute an Event of Default until the Trustee or the Holders of at least 25% in principal amount of the outstanding Securities notify the Company of the default and the Company or the Note Guarantor, as applicable, does not cure such default within the time specified in clauses (3), (4), (5), or (8) hereof after receipt of such notice.

        If an Event of Default (other than an Event of Default relating to certain events of bankruptcy, insolvency or reorganization of the Company) occurs and is continuing, the Trustee or the Holders of at least 25% in principal amount of the outstanding Securities by written notice to the Company and the Trustee specifying the Event of Default and that it is a "notice of acceleration" may declare the principal of and accrued but unpaid interest (including additional interest, if any) on all the Securities to be due and payable. Upon such a declaration, such principal and interest (including additional interest, if any) will be due and payable immediately. If an Event of Default relating to certain events of bankruptcy, insolvency or reorganization of the Company occurs, the principal of and interest (including additional interest, if any) on all the Securities will become immediately due and payable without any declaration or other act on the part of the Trustee or any Holders and if such Event of Default occurs prior to the earlier of (i) the Cash Election Date, and (ii) December 15, 2006, the Company will thereafter be obligated to pay cash interest on each subsequent Interest Payment Date and the Securities will cease to accrete. Under certain circumstances, the Holders of a majority in principal amount of the outstanding Securities may rescind any such acceleration with respect to the Securities and its consequences.

        Subject to the provisions of the Indenture relating to the duties of the Trustee, in case an Event of Default occurs and is continuing, the Trustee will be under no obligation to exercise any of the rights or powers under the Indenture at the request or direction of any of the Holders unless such Holders have offered to the Trustee indemnity or security reasonably satisfactory to it against any loss, liability or expense. Except to enforce the right to receive payment of principal, premium (if any) or interest when due, no Holder may pursue any remedy with respect to the Indenture or the Senior Secured Discount Notes unless:

(1)

such Holder has previously given the Trustee notice that an Event of Default is continuing;



(2)

Holders of at least 25% in principal amount of the outstanding Securities have requested the Trustee in writing to pursue the remedy;



(3)

such Holders have offered the Trustee reasonable security or indemnity against any loss, liability or expense;



(4)

the Trustee has not complied with such request within 60 days after the receipt of the request and the offer of security or indemnity; and



(5)

the Holders of a majority in principal amount of the outstanding Securities have not given the Trustee a direction inconsistent with such request within such 60-day period.

        Subject to certain restrictions, the Holders of a majority in principal amount of the outstanding Securities will be given the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or of exercising any trust or power conferred on the Trustee. The Trustee, however, may refuse to follow any direction that conflicts with law or the Indenture or that the Trustee determines is unduly prejudicial to the rights of any other Holder or that would involve the Trustee in personal liability. Prior to taking any action under the Indenture, the Trustee will be entitled

108

to indemnification satisfactory to it in its sole discretion against all losses and expenses caused by taking or not taking such action.

        If a Default occurs and is continuing and is known to the Trustee, the Trustee must mail to each Holder notice of the Default within the earlier of 90 days after it occurs or 30 days after it is actually known to a Trust Officer or written notice of it is received by the Trustee. Except in the case of a Default in the payment of principal of, premium (if any) or interest on any Note (including payments pursuant to the redemption provisions of such Note), the Trustee may withhold notice if and so long as a committee of its Trust Officers in good faith determines that withholding notice is in the interests of the Holders. In addition, the Company will be required to deliver to the Trustee, within 120 days after the end of each fiscal year, a certificate indicating whether the signers thereof know of any Default that occurred during the previous year. The Company will also be required to deliver to the Trustee, within 30 days after the occurrence thereof, written notice of any event which would constitute certain Events of Default, their status and what action the Company is taking or proposes to take in respect thereof.

Amendments and waivers

        Subject to certain exceptions, the Indenture, the Securities, the Security Documents or the Intercreditor Agreement may be amended with the written consent of the Holders of a majority in principal amount of the Securities then outstanding and any past default or compliance with any provisions may be waived with the consent of the Holders of a majority in principal amount of the Securities then outstanding. However, without the consent of each Holder of an outstanding Note affected, no amendment may, among other things:

(1)

reduce the amount of Securities whose Holders must consent to an amendment;



(2)

reduce the rate of or extend the time for payment of interest (including additional interest, if any) on any Security;



(3)

reduce the Accreted Value of or extend the Stated Maturity of any Security;



(4)

reduce the premium payable upon the redemption of any Security or change the time at which any Security may be redeemed as described under "—Optional redemption" above;



(5)

make any Security payable in money other than that stated in the Security;



(6)

impair the right of any Holder to receive payment of Accreted Value of, and interest or any additional interest on, such Holder's Securities on or after the due dates therefor or to institute suit for the enforcement of any payment on or with respect to such Holder's Securities;



(7)

make any change in the amendment provisions which require each Holder's consent or in the waiver provisions; or



(8)

modify the Note Guarantees in any manner adverse to the Holders.

        Notwithstanding the foregoing, without the consent of Holders representing 66²/3% in principal amount of the Securities then outstanding, no amendment or waiver may:

(1)

release any Collateral from the Lien of the Indenture and the Security Documents (except as permitted by the terms of the Security Documents or the Intercreditor Agreement);



(2)

change the provisions applicable to the application of the proceeds from the sale of Collateral; or



(3)

change or alter the priority of the security interests in the Collateral.

        Without the consent of any Holder, the Company, the Note Guarantors and the Trustee may amend the Indenture, the Securities, the Security Documents or the Intercreditor Agreement to:

•

cure any ambiguity, omission, defect or inconsistency;

109

•

provide for the assumption by a successor corporation of the obligations of the Company under the Indenture;



•

provide for uncertificated Securities in addition to or in place of certificated Securities (provided that the uncertificated Securities are issued in registered form for purposes of Section 163(f) of the Code, or in a manner such that the uncertificated Securities are described in Section 163(f)(2)(B) of the Code);



•

add additional Guarantees with respect to the Securities or to secure further the Securities;



•

add to the covenants of the Company for the benefit of the Holders or to surrender any right or power conferred upon the Company;



•

make any change that does not materially and adversely affect the rights of any Holder;



•

provide for the issuance of the New Securities or any Additional Securities;



•

comply with any requirement of the SEC in connection with the qualification of the Indenture under the TIA; or



•

if necessary, in connection with any addition or release of Collateral permitted under the terms of the Indenture or Security Documents.

        The consent of the Holders will not be necessary to approve the particular form of any proposed amendment. It will be sufficient if such consent approves the substance of the proposed amendment. After an amendment becomes effective, the Company is required to mail to Holders a notice briefly describing such amendment. However, the failure to give such notice to all Holders, or any defect therein, will not impair or affect the validity of the amendment.

        In addition, without the consent of any Holder, the Trustee may amend the terms of the Intercreditor Agreement in order to subject the security interests in the Collateral in respect of any Other First-Priority Obligations, Credit Agreement Obligations, Second-Priority Obligations and Secondary Collateral Obligations to the terms of the Intercreditor Agreement, in each case to the extent such Indebtedness was Incurred, and all Liens on the Collateral held for the benefit of such Indebtedness were granted, pursuant to the Indenture.

        In addition, without the consent of any Holder of the Securities, any amendment, waiver or consent agreed to by the Credit Agent or the holders of Credit Agreement Obligations under any provision of any of the security documents granting the first-priority lien on any Collateral to secure the Credit Agreement Obligations will, as such amendment, waiver or consent relates to the Second-Priority Collateral, automatically apply to the comparable provision of the comparable Security Document entered into in connection with the Securities. Similarly, without the consent of any holder of Second-Priority Obligations, any amendment, waiver or consent agreed to by the Trustee or the Holders of the Securities under any provision of the Security Documents granting the first-priority lien on the First-Priority Collateral will, as such amendment, waiver or consent relates to any second-priority lien securing the Second-Priority Obligations, automatically apply to the comparable provision of the comparable security document entered into connection with the Second-Priority Obligations. We will also be entitled to certain releases of the Collateral or the Note Guarantees as described above under the headings "—Note Guarantees" and "—Security." If the Company wishes under other circumstances to obtain an amendment or waiver or seek a consent under any Security Document or Note Guarantee, it will be entitled to do so if it mails written notice of its request to the Trustee and the Holders of the Securities and it does not receive written objection from Holders of at least 25% in principal amount of the Securities within 20 Business Days after that mailing. If the Company receives such objections, then it will not be entitled to effect that amendment or waiver, and such consent will not be effective, unless the Company obtains the consent of Holders of a majority in outstanding principal amount of the Securities.

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Transfer and exchange

        Subject to compliance with the restrictions on transfer and exchange set forth in the Indenture, a Holder will be able to transfer or exchange Senior Secured Discount Notes. Upon any transfer or exchange, the registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and the Company may require a Holder to pay any taxes required by law or permitted by the Indenture. The Company will not be required to transfer or exchange any Senior Secured Discount Note selected for redemption or to transfer or exchange any Senior Secured Discount Note for a period of 15 days prior to a selection of Senior Secured Discount Notes to be redeemed. The Senior Secured Discount Notes will be issued in registered form and the Holder will be treated as the owner of such Senior Secured Discount Note for all purposes.

Defeasance

        The Company may at any time terminate all its obligations under the Senior Secured Discount Notes and the Indenture ("legal defeasance"), except for certain obligations, including those respecting the defeasance trust and obligations to register the transfer or exchange of the Senior Secured Discount Notes, to replace mutilated, destroyed, lost or stolen Senior Secured Discount Notes and to maintain a registrar and paying agent in respect of the Senior Secured Discount Notes. In addition, the Company may at any time terminate:

(1)

its obligations under the covenants described under "—Certain covenants"; and



(2)

the operation of the cross acceleration provision, the bankruptcy provisions with respect to Significant Subsidiaries, the judgment default provision and the Note Guarantee provision described under "—Defaults" above ("covenant defeasance").

        In the event that the Company exercises its legal defeasance option or its covenant defeasance option, each Note Guarantor will be released from all of its obligations with respect to its Note Guarantee.

        The Company may exercise its legal defeasance option notwithstanding its prior exercise of its covenant defeasance option. If the Company exercises its legal defeasance option, payment of the Senior Secured Discount Notes may not be accelerated because of an Event of Default with respect thereto. If the Company exercises its covenant defeasance option, payment of the Senior Secured Discount Notes may not be accelerated because of an Event of Default specified in clause (3), (4), (5), (with respect to Significant Subsidiaries only), or (8) under "—Defaults" above.

        In order to exercise either defeasance option, the Company must irrevocably deposit in trust (the "defeasance trust") with the Trustee money or U.S. Government Obligations for the payment of principal, premium (if any) and interest (including additional interest, if any) in respect of the Senior Secured Discount Notes to redemption or maturity, as the case may be, and must comply with certain other conditions, including delivery to the Trustee of an Opinion of Counsel to the effect that Holders will not recognize income, gain or loss for Federal income tax purposes as a result of such deposit and defeasance and will be subject to Federal income tax on the same amounts and in the same manner and at the same times as would have been the case if such deposit and defeasance had not occurred (and, in the case of legal defeasance only, such Opinion of Counsel must be based on a ruling of the Internal Revenue Service or other change in applicable Federal income tax law).

Concerning the trustee

        Wilmington Trust Company is the Trustee under the Indenture and has been appointed by the Company as Registrar and Paying Agent with regard to the Senior Secured Discount Notes.

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Governing law

        The Indenture and the Senior Secured Discount Notes are governed by and construed in accordance with, the laws of the State of New York without giving effect to applicable principles of conflicts of law to the extent that the application of the law of another jurisdiction would be required thereby.

Certain definitions

        "Accreted Value" as of any date (the "Specified Date") means, with respect to each $1,000 principal amount at maturity of the Senior Secured Discount Notes (subject to the latest sentence of this definition):

(i)

if the Specified Date is one of the following dates (each a "Semi-Annual Accretion Date"), the amount set forth opposite each date below:

Semi-Annual Accretion Date	Accreted Value
Issue Date	$	736.27
June 15, 2004	$	762.87
December 15, 2004	$	805.31
June 15, 2005	$	850.10
December 15, 2005	$	897.39
June 15, 2006	$	947.31
December 15, 2006	$	1,000.00

(ii)

if the Specified Date occurs between two Semi-Annual Accretion Dates, the sum of (a) the Accreted Value for the Semi-Annual Accretion Date immediately preceding the Specified Date and (b) an amount equal to the product of (x) the Accreted Value for the immediately following Semi-Annual Accretion Date less the Accreted Value of the immediately preceding Semi-Annual Accretion Date and (y) the fraction, the numerator of which is the number of days actually elapsed from the immediately preceding Semi-Annual Accretion Date and the denominator of which is 180; or



(iii)

if the Specified Date is after December 15, 2006, $1,000.

        For the purposes hereof, if the Specified Date is prior to December 15, 2006 but on or after the date on which the Company elects to commence to pay cash interest (the "Cash Election Date"), all references in this document to Accreted Value in respect of any Note shall be to the aggregate principal amount of such Note, which shall be equal to the Accreted Value of the such Note as of the Cash Election Date determined in accordance with clauses (i) and (ii) above.

        "Additional Assets" means:

(1)

any property or assets (other than Indebtedness and Capital Stock) to be used by the Company or a Restricted Subsidiary in a Permitted Business or any improvement to any property or assets that are used by the Company or a Restricted Subsidiary in a Permitted Business;



(2)

Capital Stock of a Person that becomes a Restricted Subsidiary as a result of the acquisition of such Capital Stock by the Company or another Restricted Subsidiary; or



(3)

Capital Stock constituting a minority interest in any Person that at such time is a Restricted Subsidiary; provided, however, that:

any such Restricted Subsidiary described in clauses (2) or (3) above is primarily engaged in a Permitted Business.

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        "Affiliate" of any specified Person means any other Person, directly or indirectly, controlling or controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, "control" when used with respect to any Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms "controlling" and "controlled" have meanings correlative to the foregoing.

        "Asset Disposition" means any sale, lease (other than an operating lease entered into in the ordinary course of business), transfer or other disposition (or series of related sales, leases, transfers or dispositions) by the Company or any Restricted Subsidiary, including any disposition by means of a merger, consolidation, or similar transaction (each referred to for the purposes of this definition as a "disposition"), of:

(1)

any shares of Capital Stock of a Restricted Subsidiary (other than directors' qualifying shares or shares required by applicable law to be held by a Person other than the Company or a Restricted Subsidiary);



(2)

all or substantially all the assets of any division or line of business of the Company or any Restricted Subsidiary; or



(3)

any other assets of the Company or any Restricted Subsidiary outside of the ordinary course of business of the Company or such Restricted Subsidiary other than, in the case of (1), (2) and (3) above:



(A)

a disposition by a Restricted Subsidiary to the Company or by the Company or a Restricted Subsidiary to a Wholly Owned Subsidiary;



(C)

sales of accounts receivable and related assets (including contract rights) of the type specified in the definition of "Qualified Securitization Transaction" to a Securitization Entity for the fair market value thereof;



(D)

other than with respect to assets that constitute First-Priority Collateral, a disposition of obsolete or worn out property or equipment or property or equipment that is no longer used or useful in the conduct of business of the Company and its Restricted Subsidiaries;



(E)

any other disposition of assets with a fair market value, as conclusively determined by senior management of the Company in good faith, of less than $1.0 million;



(F)

sales or grants of licenses to use the Company's or any Restricted Subsidiary's patents, trade secrets, know-how and technology to the extent that such license does not prohibit the licensor from using the patent, trade secret, know-how or technology or require the licensor to pay any fees for such use;



(G)

the disposition of all or substantially all of the assets of the Company in compliance with the covenant described under the heading "—Merger and consolidation"; and



(H)

the disposition of any Capital Stock or other ownership interest in or assets or property of an Unrestricted Subsidiary.

        "Attributable Debt" in respect of a Sale/Leaseback Transaction means, as at the time of determination, the present value (discounted at the interest rate borne by the Senior Secured Discount Notes, compounded annually) of the total obligations of the lessee for rental payments during the remaining term of the lease included in such Sale/Leaseback Transaction (including any period for which such lease has been extended).

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        "Average Life" means, as of the date of determination, with respect to any Indebtedness or Preferred Stock, the quotient obtained by dividing:

(1)

the sum of the products of the numbers of years from the date of determination to the dates of each successive scheduled principal payment of such Indebtedness or scheduled redemption or similar payment with respect to such Preferred Stock multiplied by the amount of such payment by



(2)

the sum of all such payments.

        "Bank Indebtedness" means any and all amounts payable under or in respect of the Credit Agreement, including principal, premium (if any), interest (including interest accruing on or after the filing of any petition in bankruptcy or for reorganization relating to the Company or any Subsidiary whether or not a claim for post-filing interest is allowed in such proceedings), fees, charges, expenses, reimbursement obligations, guarantees and all other amounts payable thereunder or in respect thereof.

        "Board of Directors" means the Board of Directors of the Company or any committee thereof duly authorized to act on behalf of the Board of Directors of the Company.

        "Business Day" means each day which is not a Legal Holiday.

        "Capitalized Lease Obligations" means an obligation that is required to be classified and accounted for as a capitalized lease for financial reporting purposes in accordance with GAAP, and the amount of Indebtedness represented by such obligation shall be the capitalized amount of such obligation determined in accordance with GAAP; and the Stated Maturity thereof shall be the date of the last payment of rent or any other amount due under such lease prior to the first date upon which such lease may be prepaid by the lessee without payment of a penalty.

        "Capital Stock" of any Person means any and all shares, interests, rights to purchase, warrants, options, participations or other equivalents of or interests in (however designated) equity of such Person, including any Preferred Stock, but excluding any debt securities convertible into such equity.

        "Closing Date" means May 6, 2005, the date the Indenture is amended and restated.

        "Code" means the Internal Revenue Code of 1986, as amended.

        "Collateral" means the First-Priority Collateral and the Second-Priority Collateral.

        "Commodity Agreement" means any commodity futures contract, commodity option or other similar agreement or arrangement entered into by the Company or any of its Subsidiaries designed to protect the Company or any of its Subsidiaries against fluctuations in the price of commodities actually at the time used in the ordinary course of business of the Company or its Subsidiaries.

        "Consolidated Coverage Ratio" as of any date of determination means the ratio of:

(1)

the aggregate amount of EBITDA for the period of the most recent four consecutive fiscal quarters for which financial statements are publicly available ending prior to the date of such determination to



(2)

Consolidated Interest Expense for such four fiscal quarters; provided, however, that:



(A)

if the Company or any Restricted Subsidiary has Incurred any Indebtedness since the beginning of such period that remains outstanding on such date of determination or if the transaction giving rise to the need to calculate the Consolidated Coverage Ratio is an Incurrence of Indebtedness, EBITDA and Consolidated Interest Expense for such period shall be calculated after giving effect on a pro forma basis to such Indebtedness as if such Indebtedness had been Incurred on the first day of such period and the discharge of any other Indebtedness repaid, repurchased, defeased or otherwise discharged with the

114

proceeds of such new Indebtedness as if such discharge had occurred on the first day of such period;

(B)

if the Company or any Restricted Subsidiary has repaid, repurchased, defeased or otherwise discharged any Indebtedness since the beginning of such period or if any Indebtedness is to be repaid, repurchased, defeased or otherwise discharged (in each case other than Indebtedness Incurred under any revolving credit facility unless such Indebtedness has been permanently repaid and has not been replaced) on the date of the transaction giving rise to the need to calculate the Consolidated Coverage Ratio, EBITDA and Consolidated Interest Expense for such period shall be calculated on a pro forma basis as if such discharge had occurred on the first day of such period and as if the Company or such Restricted Subsidiary has not earned the interest income actually earned during such period in respect of cash or Temporary Cash Investments used to repay, repurchase, defease or otherwise discharge such Indebtedness;



(C)

if since the beginning of such period the Company or any Restricted Subsidiary shall have made any Asset Disposition in excess of $10.0 million, which constitutes all or substantially all of an operating unit of a business, the EBITDA for such period shall be reduced by an amount equal to the EBITDA (if positive) directly attributable to the assets that are the subject of such Asset Disposition for such period or increased by an amount equal to the EBITDA (if negative) directly attributable thereto for such period and Consolidated Interest Expense for such period shall be reduced by an amount equal to the Consolidated Interest Expense directly attributable to any Indebtedness of the Company or any Restricted Subsidiary repaid, repurchased, defeased or otherwise discharged with respect to the Company and its continuing Restricted Subsidiaries in connection with such Asset Disposition for such period (or, if the Capital Stock of any Restricted Subsidiary is sold, the Consolidated Interest Expense for such period directly attributable to the Indebtedness of such Restricted Subsidiary to the extent the Company and its continuing Restricted Subsidiaries are no longer liable for such Indebtedness after such sale);



(D)

if since the beginning of such period the Company or any Restricted Subsidiary (by merger or otherwise) shall have made an Investment in any Restricted Subsidiary (or any Person that becomes a Restricted Subsidiary or is merged with and into the Company) or an acquisition of assets, including any acquisition of assets occurring in connection with a transaction causing a calculation to be made hereunder, which constitutes all or substantially all of an operating unit of a business, EBITDA and Consolidated Interest Expense for such period shall be calculated after giving pro forma effect thereto (including the Incurrence of any Indebtedness) as if such Investment or acquisition occurred on the first day of such period; and



(E)

if since the beginning of such period any Person (that subsequently became a Restricted Subsidiary or was merged with or into the Company or any Restricted Subsidiary since the beginning of such period) shall have made any Asset Disposition or any Investment or acquisition of assets that would have required an adjustment pursuant to clause (C) or (D) above if made by the Company or a Restricted Subsidiary during such period, EBITDA and Consolidated Interest Expense for such period shall be calculated after giving pro forma effect thereto as if such Asset Disposition, Investment or acquisition of assets occurred on the first day of such period.

For purposes of this definition, whenever pro forma effect is to be given to an Investment or acquisition of assets, the amount of income or earnings relating thereto and the amount of Consolidated Interest Expense associated with any Indebtedness Incurred in connection therewith, the

115

pro forma calculations shall be determined in good faith by a responsible financial or accounting Officer of the Company. Any such pro forma calculations may include operating expense reductions for such period resulting from the acquisition which is being given pro forma effect that (a) would be permitted pursuant to Article 11 of Regulation S-X under the Securities Act or (b) have been realized or for which the steps necessary for realization have been taken or are reasonably expected to be taken within six months following any such acquisition, including, but not limited to, the execution or termination of any contracts, the termination of any personnel or the closing (or approval by the Board of Directors of any closing) of any facility, as applicable, provided that, such adjustments are set forth in an Officers' Certificate signed by the Company's chief financial officer and another Officer which states (i) the amount of such adjustment or adjustments, (ii) that such adjustment or adjustments are based on the reasonable good faith beliefs of the officers executing such Officers' Certificate at the time of such execution and (iii) that any related Incurrence of Indebtedness is permitted pursuant to the Indenture.

        If any Indebtedness bears a floating rate of interest and is being given pro forma effect, the interest expense on such Indebtedness shall be calculated as if the rate in effect on the date of determination had been the applicable rate for the entire period (taking into account any Interest Rate Agreement or Currency Agreement applicable to such Indebtedness if such Interest Rate Agreement or Currency Agreement has a remaining term as at the date of determination in excess of 12 months).

        "Consolidated Interest Expense" means, for any period, the total interest expense of the Company and its Consolidated Restricted Subsidiaries plus, to the extent Incurred by the Company and its Restricted Subsidiaries in such period but not included in such interest expense:

(1)

interest expense attributable to Capitalized Lease Obligations and the interest expense attributable to operating leases constituting part of a Sale/Leaseback Transaction;



(2)

amortization of debt discount and debt issuance costs;



(3)

capitalized interest;



(4)

non-cash interest expense;



(5)

commissions, discounts and other fees and charges attributable to letters of credit and bankers' acceptance financing;



(6)

interest accruing on any Indebtedness of any other Person to the extent such Indebtedness is Guaranteed by the Company or any Restricted Subsidiary;



(7)

net costs associated with Hedging Obligations (including amortization of fees), provided, however, that if Hedging Obligations result in net benefits rather than costs, such benefits shall be credited in determining Consolidated Interest Expense unless, pursuant to GAAP, such net benefits are otherwise reflected in Consolidated Net Income;



(8)

dividends and distributions declared in respect of all Disqualified Stock of the Company and dividends and distributions declared and paid in respect of all Preferred Stock of any of the Subsidiaries of the Company that is not a Note Guarantor, to the extent held by Persons other than the Company or a Wholly Owned Subsidiary;



(9)

interest Incurred in connection with investments in discontinued operations; and



(10)

the cash contributions to any employee stock ownership plan or similar trust to the extent such contributions are used by such plan or trust to pay interest or fees to any Person (other than the Company) in connection with Indebtedness Incurred by such plan or trust.

Notwithstanding anything to the contrary contained herein, commissions, discounts, yield and other fees and charges Incurred in connection with any transaction pursuant to which the Company or any

116

Subsidiary of the Company may sell, convey or otherwise transfer or grant a security interest in any accounts receivable or related assets shall be included in Consolidated Interest Expense.

        "Consolidated Net Income" means, for any period, the net income (loss) of the Company and its Consolidated Subsidiaries for such period; provided, however, that there shall not be included in such Consolidated Net Income:

(1)

any net income (loss) of any Person (other than the Company) if such Person is not a Restricted Subsidiary, except that:



(A)

subject to the limitations contained in clauses (4), (5) and (6) below, the Company's equity in the net income of any such Person for such period shall be included in such Consolidated Net Income up to the aggregate amount of cash actually distributed by such Person during such period to the Company or a Restricted Subsidiary as a dividend or other distribution (subject, in the case of a dividend or other distribution made to a Restricted Subsidiary, to the limitations contained in clause (3) below) and



(B)

the Company's equity in a net loss of any such Person for such period shall be included in determining such Consolidated Net Income to the extent such loss has been funded with cash from the Company or a Restricted Subsidiary;



(2)

other than for purposes of clauses (D) and (E) of the definition of Consolidated Coverage Ratio, any net income (or loss) of any Person acquired by the Company or a Subsidiary in a pooling of interests transaction for any period prior to the date of such acquisition;



(3)

any net income (or loss) of any Restricted Subsidiary if such Restricted Subsidiary is subject to restrictions, directly or indirectly, on the payment of dividends or the making of distributions or loans or intercompany advances by such Restricted Subsidiary, directly or indirectly, to the Company, except that:



(A)

subject to the limitations contained in clauses (4), (5) and (6) below, the Company's equity in the net income of any such Restricted Subsidiary for such period shall be included in such Consolidated Net Income up to the aggregate amount of cash actually distributed, loaned or advanced by such Restricted Subsidiary during such period to the Company or another Restricted Subsidiary as a dividend, distribution, loan or advance (subject, in the case of a dividend, distribution, loan or advance made to another Restricted Subsidiary, to the limitation contained in this clause) and



(B)

the Company's equity in a net loss of any such Restricted Subsidiary for such period shall be included in determining such Consolidated Net Income;



(4)

any gain (loss) realized upon the sale or other disposition of any asset of the Company or its Consolidated Subsidiaries (including pursuant to any Sale/Leaseback Transaction) that is not sold or otherwise disposed of in the ordinary course of business and any gain (loss) realized upon the sale or other disposition of any Capital Stock of any Person;



(5)

any extraordinary gain or loss; and



(6)

the cumulative effect of a change in accounting principles.

        "Consolidation" means the consolidation of the amounts of each of the Restricted Subsidiaries with those of the Company in accordance with GAAP consistently applied; provided, however, that "Consolidation" will not include consolidation of the accounts of any Unrestricted Subsidiary, but the interest of the Company or any Restricted Subsidiary in an Unrestricted Subsidiary will be accounted for as an investment. The term "Consolidated" has a correlative meaning.

117

        "Credit Agent" means General Electric Capital Corporation, in its capacity as collateral agent for the lenders party to the Credit Agreement or any successor thereto, or any Person otherwise designated the "Credit Agent" pursuant to the Intercreditor Agreement.

        "Credit Agreement" means the credit agreement dated as of the Original Issue Date, among the Company, Uniplast Industries Co., the financial institutions party thereto as lenders, Credit Suisse First Boston, acting through its Cayman Islands Branch, as administrative agent, Deutsche Bank Trust Company Americas, as collateral agent, and JPMorgan Chase Bank, as syndication agent, together with related documents thereto including any guarantee agreements and security documents, as amended, modified, supplemented, restated, renewed, refunded, replaced, restructured, repaid or refinanced from time to time (including any agreement extending the maturity thereof or increasing the amount of available borrowings thereunder or adding Restricted Subsidiaries of the Company as additional borrowers or guarantors thereunder) whether with the original agents and lenders or otherwise and whether provided under the original credit agreement or other credit agreements or otherwise.

        "Credit Agreement Obligations" means (i) all Bank Indebtedness and all other Indebtedness outstanding under one or more of any other First-Lien Credit Facilities that constitutes Permitted Debt and that is designated by the Company as "Credit Agreement Obligations" for purposes of the Indenture and is secured by a Permitted Lien described in clause (1)(B) of the definition thereof, (ii) all other obligations (not constituting Indebtedness) of the Company or any Note Guarantor under the Credit Agreement or any such other First-Lien Credit Facility and (iii) all other obligations of the Company or any Note Guarantor in respect of Hedging Obligations or obligations in respect of cash management services that are designated by the Company to be "Credit Agreement Obligations" for purposes of the Indenture. Notwithstanding anything to the contrary in the previous sentence, any Indebtedness and other obligations Incurred under the Credit Agreement or otherwise shall be deemed to constitute Credit Agreement Obligations if the holders of such Indebtedness or other obligations or their agent or representative shall have received a written representation from the Company in, or in connection with, the Credit Agreement or other agreement governing such Indebtedness or other obligations that such Indebtedness constitutes, Credit Agreement Obligations (whether or not such Indebtedness is at any time determined not to have been permitted to be Incurred under the Indenture).

        "Credit Facilities" means, one or more (A) debt facilities (including, without limitation, the Credit Agreement) or commercial paper facilities, providing for revolving credit loans, term loans, receivables financing (including through the sale of receivables to lenders or to special purpose entities formed to borrow from lenders against such receivables) or letters of credit, (B) debt securities, indentures or other forms of debt financing (including convertible or exchangeable debt instruments), or (C) instruments or agreements evidencing any other Indebtedness, in each case, as amended, supplemented, modified, extended, renewed, restated or refunded in whole or in part from time to time.

        "Currency Agreement" means with respect to any Person any foreign exchange contract, currency swap agreements or other similar agreement or arrangement to which such Person is a party or of which it is a beneficiary.

        "Default" means any event which is, or after notice or passage of time or both would be, an Event of Default.

118

        "Discharge of Credit Agreement Obligations" means payment in full in cash of the principal of and interest and premium, if any, on all Indebtedness outstanding under the First-Lien Credit Facilities or, with respect to Hedging Obligations or letters of credit outstanding thereunder, delivery of cash collateral or backstop letters of credit in respect thereof in compliance with such First-Lien Credit Facility, in each case after or concurrently with termination of all commitments to extend credit thereunder, and payment in full of any other Credit Agreement Obligations that are due and payable or otherwise accrued and owing at or prior to the time such principal, interest and premium, if any, are paid.

        "Disqualified Stock" means, with respect to any Person, any Capital Stock of such Person which by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable or exercisable) or upon the happening of any event:

(1)

matures or is mandatorily redeemable pursuant to a sinking fund obligation or otherwise;



(2)

is convertible or exchangeable for Indebtedness or Disqualified Stock (excluding Capital Stock convertible or exchangeable solely at the option of the Company or a Restricted Subsidiary, provided, that any such conversion or exchange shall be deemed an issuance of Indebtedness or an issuance of Disqualified Stock, as applicable); or



(3)

is redeemable at the option of the holder thereof, in whole or in part, in each case on or prior to 91 days after the Stated Maturity of the Senior Secured Discount Notes; provided, however, that only the portion of Capital Stock that so matures or is mandatorily redeemable, is so convertible or exchangeable or is so redeemable at the option of the holder thereof prior to such date will be deemed Disqualified Stock; provided, further, that any Capital Stock that would not constitute Disqualified Stock but for provisions thereof giving holders thereof the right to require such Person to repurchase or redeem such Capital Stock upon the occurrence of an "asset sale" or "change of control" shall not constitute Disqualified Stock if the "asset sale" or "change of control" provisions applicable to such Capital Stock provide that such Person may not repurchase or redeem such Capital Stock pursuant to such provisions and provided, further that any class of Capital Stock of such Person that, by its terms, authorizes such Person to satisfy in full its obligations with respect to payment of dividends or upon maturity, redemption (pursuant to a sinking fund or otherwise) or repurchase thereof or other payment obligations or otherwise by delivery of Capital Stock that is not Disqualified Stock, and that is not convertible, puttable or exchangeable for Disqualified Stock or Indebtedness, shall not be deemed Disqualified Stock so long as such Person satisfies its obligations with respect thereto solely by the delivery of Capital Stock that is not Disqualified Stock.

        "Domestic Overdraft Facility" means an overdraft line of credit in a maximum principal amount of $10.0 million at any time outstanding.

        "Domestic Subsidiary" means any Restricted Subsidiary of the Company other than a Foreign Subsidiary.

        "EBITDA" for any period means the Consolidated Net Income for such period, excluding the following to the extent included in calculating such Consolidated Net Income:

(1)

income tax expense of the Company and its Consolidated Restricted Subsidiaries;



(2)

Consolidated Interest Expense;



(3)

depreciation expense of the Company and its Consolidated Restricted Subsidiaries;



(4)

amortization expense of the Company and its Consolidated Restricted Subsidiaries (but excluding amortization expense attributable to a prepaid cash item that was paid in a prior period);

119

(5)

other noncash charges of the Company and its Consolidated Restricted Subsidiaries (excluding any such noncash charge to the extent it represents an accrual of or reserve for cash expenditures in any future period);



(6)

income or loss from discontinued operations;



(7)

plant closing costs (as defined by GAAP); and



(8)

noncash stock-based compensation expense.

Notwithstanding the foregoing, the provision for taxes based on the income or profits of, and the depreciation and amortization and noncash charges of, a Restricted Subsidiary of the Company shall be added to Consolidated Net Income to compute EBITDA only to the extent (and in the same proportion) that the net income (loss) of such Restricted Subsidiary was included in calculating Consolidated Net Income and only if a corresponding amount would be permitted at the date of determination to be dividended, loaned or advanced to the Company by such Restricted Subsidiary without prior approval of Persons other than the Board of Directors or holders of the Company's Capital Stock (that has not been obtained), pursuant to the terms of its charter and all agreements, instruments, judgments, decrees, orders, statutes, rules and governmental regulations applicable to such Restricted Subsidiary or its stockholders.

        "Equity Offering" means any public or private sale of the common stock of the Company, other than any public offering with respect to the Company's common stock registered on Form S-8 or other issuances upon exercise of options by employees of the Company or any of its Restricted Subsidiaries.

        "Exchange Act" means the Securities Exchange Act of 1934, as amended.

        "Excluded Contribution" means net cash proceeds received by the Company from (a) contributions to its common equity capital and (b) the sale (other than to a Subsidiary of the Company or to any Company or Subsidiary management equity plan or stock option plan or any other management or employee benefit plan or agreement) of Capital Stock (other than Disqualified Stock) of the Company, in each case designated as Excluded Contributions pursuant to an Officers' Certificate executed on the date such capital contributions are made or the date such Capital Stock is sold, as the case may be.

        "Existing Management Stockholders" means each of Harold C. Bevis, R. David Corey, Brian E. Johnson, Len Azzaro and Stanley B. Bikulege.

        "First-Lien Credit Facilities" means (x) the Credit Facilities provided pursuant to the Credit Agreement and (y) any other Credit Facility that, in the case of both clauses (x) and (y), is secured by a Permitted Lien described in clause (1)(B) of the definition thereof and, except for the Credit Facilities provided pursuant to the existing senior bank facilities, is designated by the Company as a "First-Lien Credit Facility" for the purposes of the Indenture.

        "First-Priority Assets" means real property, fixtures and equipment (including any leasehold interest therein) and the Other First-Priority Assets.

        "First-Priority Collateral" means any and all of the following assets and properties now owned or at any time hereafter acquired by the Company or any Note Guarantor and with respect to which a Lien is granted as security for the First-Priority Obligations: (a) all First-Priority Assets, (b) the Notes Collateral Account, (c) all books and records relating to the foregoing and (d) all Proceeds of any and all of the foregoing.

        "First-Priority Obligations" means the Notes Obligations and the Other First-Priority Obligations.

        "Foreign Subsidiary" means any Restricted Subsidiary of the Company organized and conducting its principal operations outside the United States.

120

        "Foreign Subsidiary Asset Disposition" means any direct or indirect sale, issuance, conveyance, transfer, lease, assignment or other transfer for value by the Company or any of its Restricted Subsidiaries (including any Sale/Leaseback Transaction) to any Person other than the Company or a Restricted Subsidiary of the Company of the Capital Stock of any Foreign Subsidiary or any of the property or assets of any Foreign Subsidiary.

        "GAAP" means generally accepted accounting principles in the United States of America as in effect as of the Closing Date, including those set forth in:

(1)

the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants;



(2)

statements and pronouncements of the Financial Accounting Standards Board;



(3)

such other statements by such other entities as are approved by a significant segment of the accounting profession; and



(4)

the rules and regulations of the SEC governing the inclusion of financial statements (including pro forma financial statements) in periodic reports required to be filed pursuant to Section 13 of the Exchange Act, including opinions and pronouncements in staff accounting bulletins and similar written statements from the accounting staff of the SEC.

        All ratios and computations based on GAAP contained in the Indenture shall be computed in conformity with GAAP.

        "Guarantee" means any obligation, contingent or otherwise, of any Person directly or indirectly guaranteeing any Indebtedness of any other Person and any obligation, direct or indirect, contingent or otherwise, of such Person:

(1)

to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness of such other Person (whether arising by virtue of partnership arrangements, or by agreement to keep-well, to purchase assets, goods, securities or services, to take-or-pay, or to maintain financial statement conditions or otherwise) or



(2)

entered into for purposes of assuring in any other manner the obligee of such Indebtedness of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part);

provided, however, that the term "Guarantee" shall not include endorsements for collection or deposit in the ordinary course of business. The term "Guarantee" used as a verb has a corresponding meaning. The term "Guarantor" shall mean any Person Guaranteeing any obligation.

        "Hedging Obligations" of any Person means the obligations of such Person pursuant to any Commodity Agreement, Interest Rate Agreement or Currency Agreement.

        "Holder" means the Person in whose name a Note is registered on the Registrar's books.

        "Incur" means issue, assume, Guarantee, incur or otherwise become liable for; provided, however, that any Indebtedness or Capital Stock of a Person existing at the time such Person becomes a Subsidiary (whether by merger, consolidation, acquisition or otherwise) shall be deemed to be Incurred by such Person at the time it becomes a Subsidiary. The term "Incurrence" when used as a noun shall have a correlative meaning.

        "Indebtedness" means, with respect to any Person on any date of determination (without duplication):

(1)

the principal of and premium (if any) in respect of indebtedness of such Person for borrowed money;

121

(2)

the principal of and premium (if any) in respect of obligations of such Person evidenced by bonds, debentures, notes or other similar instruments;



(3)

all obligations of such Person in respect of letters of credit or other similar instruments (including reimbursement obligations with respect thereto);



(4)

all obligations of such Person to pay the deferred and unpaid purchase price of property or services (except Trade Payables and other accrued liabilities arising in the ordinary course of business), which purchase price is due more than six months after the date of placing such property in service or taking delivery and title thereto or the completion of such services;



(5)

all Capitalized Lease Obligations and all Attributable Debt of such Person;



(6)

all obligations of such Person with respect to the redemption, repayment or other repurchase of any Disqualified Stock or, with respect to any Subsidiary of such Person that is not a Note Guarantor, any Preferred Stock (but excluding, in each case, any accrued dividends);



(7)

all Indebtedness of other Persons secured by a Lien on any asset of such Person, whether or not such Indebtedness is assumed by such Person; provided, however, that the amount of Indebtedness of such Person shall be the lesser of:



(A)

the fair market value of such asset at such date of determination and



(B)

the amount of such Indebtedness of such other Persons;



(8)

to the extent not otherwise included in this definition, the net obligations under Hedging Obligations of such Person;



(9)

to the extent not otherwise included, the amount then outstanding (i.e., advanced, and received by, and available for use by, such Person) under any receivables financing (as set forth in the books and records of such Person and confirmed by the agent, trustee or other representative of the institution or group providing such receivables financing); and



(10)

all obligations of the type referred to in clauses (1) through (9) of other Persons and all dividends of other Persons for the payment of which, in either case, such Person is responsible or liable, directly or indirectly, as obligor, guarantor or otherwise, including by means of any Guarantee.

Notwithstanding the foregoing, "Indebtedness" shall not include unsecured indebtedness of the Company and its Restricted Subsidiaries Incurred to finance insurance premiums in a principal amount not in excess of the insurance premiums to be paid by the Company and its Restricted Subsidiaries for a three-year period beginning on the date of Incurrence of any such Indebtedness.

        The amount of Indebtedness of any Person at any date shall be the outstanding balance at such date of all unconditional obligations as described above and the maximum liability, upon the occurrence of the contingency giving rise to the obligation, of any contingent obligations at such date.

        "Intangible Assets" means goodwill, patents, trademarks and other intangibles as determined in accordance with GAAP.

        "Intercreditor Agreement" means that certain intercreditor agreement, dated as of the Original Issue Date, by and among the Company, the Credit Agent, the May 2003 Notes Agent and the Trustee, as amended (including any amendment and restatement thereof), supplemented or otherwise modified or replaced from time to time.

        "Interest Rate Agreement" means with respect to any Person any interest rate protection agreement, interest rate future agreement, interest rate option agreement, interest rate swap

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agreement, interest rate cap agreement, interest rate collar agreement, interest rate hedge agreement or other similar agreement or arrangement as to which such Person is party or a beneficiary.

        "Investment" in any Person means any direct or indirect advance, loan (other than advances to customers in the ordinary course of business that are recorded as accounts receivable on the balance sheet of the lender) or other extension of credit (including by way of Guarantee or similar arrangement) or capital contribution to (by means of any transfer of cash or other property (excluding Capital Stock of the Company) to others or any payment for property or services for the account or use of others), or any purchase or acquisition of Capital Stock, Indebtedness or other similar instruments issued by such Person. For purposes of the definition of "Unrestricted Subsidiary":

(1)

"Investment" shall include the portion (proportionate to the Company's equity interest in such Subsidiary) of the fair market value of the net assets of any Subsidiary of the Company at the time that such Subsidiary is designated an Unrestricted Subsidiary; provided, however, that upon a redesignation of such Subsidiary as a Restricted Subsidiary, the Company shall be deemed to continue to have a permanent "Investment" in an Unrestricted Subsidiary in an amount (if positive) equal to:



(A)

the Company's "Investment" in such Subsidiary at the time of such redesignation less



(B)

the portion (proportionate to the Company's equity interest in such Subsidiary) of the fair market value of the net assets of such Subsidiary at the time of such redesignation;



(2)

any property transferred to or from an Unrestricted Subsidiary shall be valued at its fair market value at the time of such transfer, in each case as determined in good faith by (i) the senior management of the Company if the amount thereof is less than $2.0 million and (ii) the Board of Directors if in excess thereof; and



(3)

the amount of any Investment shall be the original cost as of the date of determination of such Investment plus the cost of all additional Investments by the Company or any of its Restricted Subsidiaries, without any adjustments for increases or decreases in value or writeups, write-downs or write-offs with respect to such Investments.

        "Legal Holiday" means a Saturday, Sunday or other day on which banking institutions in New York State are authorized or required by law to close.

        "Lien" means any mortgage, pledge, security interest, encumbrance, lien or charge of any kind (including any conditional sale or other title retention agreement or lease in the nature thereof).

        "Material After-Acquired Property" means (i) assets acquired by the Company or any Note Guarantor after the date the Senior Secured Discount Notes are issued which constitute accretions, additions or technological upgrades to the assets that form part of the First-Priority Collateral immediately prior to such accretion, addition or upgrade, (ii) First-Priority Assets of the Company or any Note Guarantor acquired after the date the Senior Secured Discount Notes are issued (or First-Priority Assets of any Note Guarantor that is formed or acquired after the date the Senior Secured Discount Notes are issued) and (iii) any First-Priority Assets acquired by the Company or any Restricted Subsidiary.

        "Material Subsidiary" means, at any date of determination, any Subsidiary of the Company that, together with its Subsidiaries, (i) for the most recent fiscal year of the Company accounted for more than 10.0% of the consolidated revenues of the Company or (ii) as of the end of such fiscal year, was the owner of 10.0% of the consolidated assets of the Company, all as set forth on the most recently available consolidated financial statement of the Company and its consolidated Subsidiaries for such fiscal year prepared in conformity with GAAP.

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        "May 2003 Notes" means the $250,000,000 aggregate principal amount of the Company's 11¹/8% senior secured notes due 2009 issued by the Company on May 30, 2003, together with any new notes issued in respect thereof.

        "May 2003 Notes Agent" means Wilmington Trust Company, in its capacity as trustee for the holders of the May 2003 Notes or any successor thereto, or any Person designated as the "May 2003 Notes Agent" pursuant to the Intercreditor Agreement.

        "May 2003 Notes Documents" means the indenture under which the May 2003 Notes were issued, together with related documents thereto, including any guarantee agreements and security documents, as may be amended, modified, supplemented, restated or replaced from time to time.

        "May 2003 Notes Obligations" means the Indebtedness evidenced by the May 2003 Notes, including principal, premium (if any), interest (including interest accruing on or after the filing of any petition in bankruptcy or for reorganization relating to the Company whether or not a claim for post-filing interest is allowed in such proceedings), fees, charges, expenses, reimbursement obligations, guarantees and all other amounts payable thereunder or in respect thereof.

        "May 2003 Notes Security Agreement" means the Second Priority Security Agreement securing the May 2003 Notes, as in effect as of the Closing Date.

        "Net Available Cash" from an Asset Disposition means cash payments received (including any cash payments received by way of deferred payment of principal pursuant to a note or installment receivable or otherwise and proceeds from the sale or other disposition of any securities received as consideration, but only as and when received, but excluding any other consideration received in the form of assumption by the acquiring Person of Indebtedness or other obligations relating to the properties or assets that are the subject of such Asset Disposition or received in any other non-cash form) therefrom, in each case net of:

(1)

all legal, accounting, investment banking, title and recording tax expenses, commissions and other fees and expenses incurred, and all Federal, state, provincial, foreign and local taxes required to be paid or accrued as a liability under GAAP, as a consequence of such Asset Disposition;



(2)

all payments made on any Indebtedness which is secured by any assets subject to such Asset Disposition, in accordance with the terms of any Lien upon or other security agreement of any kind with respect to such assets, or which must by its terms, or in order to obtain a necessary consent to such Asset Disposition, or by applicable law be repaid out of the proceeds from such Asset Disposition;



(3)

all distributions and other payments required to be made to minority interest holders in Subsidiaries or joint ventures as a result of such Asset Disposition;



(4)

the decrease in proceeds from Qualified Securitization Transactions which results from such Asset Disposition; and



(5)

appropriate amounts to be provided by the seller as a reserve, in accordance with GAAP, against any liabilities associated with the property or other assets disposed of in such Asset Disposition and retained by the Company or any Restricted Subsidiary after such Asset Disposition.

        "Net Cash Proceeds", with respect to any issuance or sale of Capital Stock, means the cash proceeds of such issuance or sale net of attorneys' fees, accountants' fees, underwriters' or placement agents' fees, discounts or commissions and brokerage, consultant and other fees and expenses actually incurred in connection with such issuance or sale and net of taxes paid or payable as a result thereof.

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        "Note Guarantee" means each Guarantee of the obligations with respect to the Securities issued by a Person pursuant to the terms of the Indenture.

        "Note Guarantor" means any Person that has issued a Note Guarantee.

        "Notes Collateral Account" means an account maintained by the Company in the name of the Trustee with any financial institution reasonably designated by the Trustee into which Net Cash Proceeds in respect of the First-Priority Collateral is required to be deposited pursuant to the Indenture or the Security Documents.

        "Notes Obligations" means the Indebtedness evidenced by the Securities, including principal, premium (if any), interest (including interest accruing on or after the filing of any petition in bankruptcy or for reorganization relating to the Company whether or not a claim for post-filing interest is allowed in such proceedings), fees, charges, expenses, reimbursement obligations, guarantees and all other amounts payable thereunder or in respect thereof.

        "Officer" means the Chairman of the Board, the Chief Executive Officer, the Chief Financial Officer, the President, any Vice President, the Treasurer, the Secretary or any Assistant Secretary of the Company.

        "Officers' Certificate" means a certificate signed by two Officers.

        "Opinion of Counsel" means a written opinion from legal counsel who is acceptable to the Trustee. The counsel may be an employee of or counsel to the Company or the Trustee.

        "Original Issue Date" means February 17, 2004.

        "Other First-Priority Assets" means intellectual property and all other types of property in which a security interest is granted pursuant to the May 2003 Notes Security Agreement, other than the Second-Priority Collateral.

        "Other First-Priority Obligations" means any Refinancing Indebtedness in respect of the Senior Secured Discount Notes that is designated by the Company as "Other First-Priority Obligations" for purposes of the Indenture, including principal, premium (if any), interest (including interest accruing on or after the filing of any petition in bankruptcy or for reorganization relating to the Company or any Note Guarantor whether or not a claim for post-filing interest is allowed in such proceedings), fees, charges, expenses, reimbursement obligations, guarantees and all other amounts payable thereunder or in respect thereof; provided, however, that if such Refinancing Indebtedness contains or otherwise has the benefit of provisions effectively requiring that proceeds from sales or transfers of property or assets by the Company or any Subsidiary of the Company be applied to repay, redeem or retire, or offer to repay, redeem or retire, such Refinancing Indebtedness, the terms thereof shall be no more favorable to the holders of such Refinancing Indebtedness than those set forth in the Indenture for the benefit of the Holders.

        "Permitted Business" means the design, manufacture and/or marketing of films and flexible packaging products for food, personal care, medical, retail, agricultural, industrial and other applications or any businesses that are reasonably related, ancillary or complementary thereto.

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        "Permitted Holders" means each of (i) J.P. Morgan Partners, LLC and its Affiliates, (ii) Southwest Industrial Films, LLC and its Affiliates, (iii) the Christena Karen H. Durham Trust, (iv) the Existing Management Stockholders and their Related Parties and (v) any Person acting in the capacity of an underwriter in connection with a public or private offering of the Company's Capital Stock.

        "Permitted Investment" means an Investment by the Company or any Restricted Subsidiary in:

(1)

the Company, a Restricted Subsidiary or a Person that will, upon the making of such Investment, become a Restricted Subsidiary;



(2)

another Person if as a result of such Investment such other Person is merged or consolidated with or into, or transfers or conveys all or substantially all its assets to, the Company or a Restricted Subsidiary;



(3)

Temporary Cash Investments;



(4)

receivables owing to the Company or any Restricted Subsidiary if created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary trade terms; provided, however, that such trade terms may include such concessionary trade terms as the Company or any such Restricted Subsidiary deems reasonable under the circumstances;



(5)

payroll, travel and similar advances or loans to cover matters that are expected at the time of such advances ultimately to be treated as expenses for accounting purposes and that are made in the ordinary course of business;



(6)

loans or advances to officers, directors, consultants or employees made (a) in the ordinary course of business and not exceeding $3.0 million in any year or (b) to fund purchases of stock under the Company's 2000 Stock Incentive Plan, 2002 Stock Incentive Plan and any similar plans or employment arrangements;



(7)

Capital Stock, obligations or other securities received in settlement of debts created in the ordinary course of business and owing to the Company or any Restricted Subsidiary or in satisfaction of judgments or pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of a debtor;



(9)

any Investment by the Company or a Restricted Subsidiary in a Securitization Entity or any Investment by a Securitization Entity in any other Person in connection with a Qualified Securitization Transaction; provided that any Investment in a Securitization Entity is in the form of a purchase money note or an equity interest;



(10)

Hedging Obligations entered into in the ordinary course of business;



(11)

endorsements of negotiable instruments and documents in the ordinary course of business;



(12)

assets or securities of a Person acquired by the Company or a Restricted Subsidiary to the extent the consideration for such acquisition consists of Capital Stock (other than Disqualified Stock) of the Company;



(13)

Investments in existence on the Original Issue Date;



(14)

Investments of a Person or any of its Subsidiaries existing at the time such Person becomes a Restricted Subsidiary of the Company or at the time such Person merges or consolidates with the Company or any of its Restricted Subsidiaries, in either case in compliance with the Indenture, provided that such Investments were not made by such Person in connection with, or in anticipation or contemplation of, such Person becoming a Restricted Subsidiary of the Company or such merger or consolidation;

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(15)

Investments in Unrestricted Subsidiaries or joint ventures not to exceed $30.0 million since the Original Issue Date, plus (A) the aggregate net after-tax amount returned since the Original Issue to the Company or any Restricted Subsidiary in cash on or with respect to any Investments made since the Original Issue in Unrestricted Subsidiaries and joint ventures whether through interest payments, principal payments, dividends or other distributions or payments (including such dividends, distributions or payments made concurrently with such Investment), (B) the net after-tax cash proceeds received since the Original Issue Date by the Company or any Restricted Subsidiary from the disposition of all or any portion of such Investments (other than to the Company or a Subsidiary of the Company) and (C) upon redesignation since the Original Issue Date of an Unrestricted Subsidiary as a Restricted Subsidiary, the fair market value of such Subsidiary; and



(16)

additional Investments since the Original Issue Date in an aggregate amount not to exceed $15.0 million.

        "Permitted Liens" means:

(1)

Liens securing the Securities, the New Notes, the Additional Securities and the Note Guarantees thereof;



(2)

Liens in favor of the Company or any Restricted Subsidiary;



(3)

Liens on property of a Person existing at the time such Person is merged with or into or consolidated with or acquired by the Company or any Restricted Subsidiary;



(4)

Liens on property existing at the time of acquisition of the property by the Company or any Restricted Subsidiary;



(6)

Liens for taxes, assessments or governmental charges or claims that are not yet delinquent or that are being contested in good faith by appropriate proceedings promptly instituted and diligently concluded; provided that any reserve or other appropriate provision as is required in conformity with GAAP has been made therefor;



(7)

Liens incurred in the ordinary course of business including, without limitation, judgment and attachment liens of the Company or any Restricted Subsidiary of the Company with respect to obligations that do not exceed in the aggregate $25.0 million at any one time outstanding and that are not incurred in connection with the borrowing of money or the obtaining of advances of credit (other than trade credit in the ordinary course of business, not evidenced by a note and not past due);



(8)

Liens in favor of the Trustee, the trustee under the Senior Subordinated Notes Indentures, the warrant agent under the warrant agreement dated as of May 31, 2000 entered into by the Company and any other trustee or warrant agent acting in such capacity with respect to one or more future indentures or agreements;



(9)

Liens incurred in connection with Refinancing Indebtedness, but only if such Liens extend to no more assets than the Liens securing the Indebtedness being refinanced; provided that no Liens may be incurred pursuant to this clause (10) in respect of First-Priority Collateral, except to the extent the Liens on such First- Priority Collateral are incurred in connection with Refinancing Indebtedness that Refinanced Indebtedness that was secured by Permitted Liens described under clauses (4), (5) or (6) of the definition thereof;



(10)

Liens securing Hedging Obligations;



(11)

statutory Liens of landlords and carriers', warehousemen's, mechanics', suppliers', materialmen's, repairmen's, or other like Liens (including contractual landlords liens) arising in the ordinary course of business and with respect to amounts not yet delinquent by more

127

than 60 days or being contested in good faith by appropriate proceedings, if a reserve or other appropriate provision, if any, as shall be required in conformity with GAAP shall have been made therefor;

(12)

Liens incurred and deposits made in the ordinary course of business in connection with workers' compensation, unemployment insurance and other types of social security;



(13)

Liens to secure Indebtedness of any Foreign Subsidiary (other than Liens described by clause (1)(A) of this definition);



(14)

licenses, sublicenses, subleases, easements, zoning restrictions, rights-of-way, restrictions, minor defects or irregularities in title and other similar charges or encumbrances not interfering in any material respect with the business of the Company or any of its Restricted Subsidiaries;



(15)

Liens on specific items of inventory or other goods and proceeds thereof of any Person securing such Person's obligations in respect of bankers' acceptances issued or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;



(16)

Liens securing reimbursement obligations with respect to commercial letters of credit which encumber documents and the property relating to such letters of credit and products and proceeds thereof;



(17)

any interest or title of a lessor in the property subject to any lease or arising from filing Uniform Commercial Code financing statements regarding leases;



(18)

judgment liens in respect of judgments that do not constitute an Event of Default;



(19)

Liens existing on the Original Issue Date;



(20)

Liens incurred or deposits made to secure the performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case in the ordinary course of business;



(21)

ground leases in respect of real property on which facilities owned or leased by the Company or any of its Restricted Subsidiaries are located;



(22)

Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods;



(23)

leases or subleases granted to other Persons and not interfering in any material respect with the business of the Company and its Restricted Subsidiaries, taken as a whole;



(25)

Liens arising solely by virtue of any statutory or common law provision relating to banker's liens, rights of setoff or similar rights; and



(26)

Liens securing insurance premium financing arrangements which are otherwise excluded from the definition of Indebtedness.

        "Person" means any individual, corporation, partnership, limited liability company, joint venture, association, joint-stock company, trust, unincorporated organization, government or any agency or political subdivision thereof or any other entity.

        "Preferred Stock", as applied to the Capital Stock of any Person, means Capital Stock of any class or classes (however designated) that is preferred as to th1e payment of dividends, or as to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such Person, over Capital Stock of any other class of such Person.

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        "principal" of a Note means the principal of the Note plus the premium, if any, payable on the Note which is due or overdue or is to become due at the relevant time.

        "Proceeds" shall have the meaning assigned to such term in the UCC.

        "Public Market" means any time after:

(1)

an Equity Offering has been consummated and



(2)

at least 15% of the total issued and outstanding common stock of the Company has been distributed by means of an effective registration statement under the Securities Act.

        "Qualified Securitization Transaction" means any transaction or series of transactions that may be entered into by the Company or any of its Subsidiaries pursuant to which the Company or any of its Subsidiaries may sell, convey or otherwise transfer pursuant to customary terms to (a) a Securitization Entity (in the case of a transfer by the Company or any of its Subsidiaries) and (b) any other Person (in the case of transfer by a Securitization Entity), or may grant a security interest in any accounts receivable (whether now existing or arising or acquired in the future) of the Company or any of its Subsidiaries, and any assets related thereto including, without limitation, all collateral securing such accounts receivable, all contracts and contract rights and all guarantees or other obligations in respect of such accounts receivable, proceeds of such accounts receivable and other assets (including contract rights) which are customarily transferred or in respect of which security interests are customarily granted in connection with asset securitization transactions involving accounts receivable.

        "Qualified Stock" means any Capital Stock that is not Disqualified Stock.

        "Refinance" means, in respect of any Indebtedness, to refinance, extend, renew, refund, repay, prepay, redeem, defease or retire, or to issue other Indebtedness exchange or replacement for, such Indebtedness. "Refinanced" and "Refinancing" shall have correlative meanings.

        "Refinancing Indebtedness" means Indebtedness that is Incurred to Refinance any Indebtedness of the Company or any Restricted Subsidiary existing on the Closing Date or Incurred in compliance with the Indenture (including Indebtedness of the Company or a Restricted Subsidiary that Refinances Refinancing Indebtedness); provided, however, that:

(1)

the Refinancing Indebtedness has a Stated Maturity no earlier than the Stated Maturity of the Indebtedness being Refinanced;



(2)

the Refinancing Indebtedness has an Average Life at the time such Refinancing Indebtedness is Incurred that is equal to or greater than the Average Life of the Indebtedness being refinanced;



(3)

such Refinancing Indebtedness is Incurred in an aggregate principal amount (or if issued with original issue discount, an aggregate issue price) (whether in U.S. dollars or a foreign currency) that is equal to or less than the aggregate principal amount (or if issued with original issue discount, the aggregate accreted value) (in U.S. dollars or such foreign currency, as applicable) then outstanding (plus, without duplication, accrued interest, premium and defeasance costs required to be paid under the terms of the Indebtedness being Refinanced and the fees, expenses, discounts, commissions and other issuance costs incurred in connection with the Refinancing Indebtedness) of the Indebtedness being Refinanced; and



(4)

if the Indebtedness being Refinanced is subordinated in right of payment to the Senior Secured Discount Notes or a Note Guarantee of a Note Guarantor, such Refinancing Indebtedness is subordinated in right of payment to the Senior Secured Discount Notes or the Note Guarantee at least to the same extent as the Indebtedness being Refinanced;

129

provided further, however, that Refinancing Indebtedness shall not include:

(A)

Indebtedness of a Restricted Subsidiary that is not a Note Guarantor that Refinances Indebtedness of the Company or



(B)

Indebtedness of the Company or a Restricted Subsidiary that Refinances Indebtedness of an Unrestricted Subsidiary.

        "Registration Rights Agreement" means the Exchange and Registration Rights Agreement dated as of the Original Issue Date and the Closing Date, respectively among the Company, the Note Guarantors and J.P. Morgan Securities Inc., Credit Suisse First Boston LLC, Deutsche Bank Securities Inc. and General Electric Capital Corporation, as Initial Purchasers.

        "Related Parties" means with respect to a Person (a) that is a natural person (1) any spouse, parent or lineal descendant (including adopted children) of such Person or (2) the estate of such Person during any period in which such estate holds Capital Stock of the Company for the benefit of any person referred to in clause (a)(1) and (b) any trust, corporation, partnership, limited liability company or other entity, the beneficiaries, stockholders, partners, owners or Persons beneficially owning an interest of more than 50% of which consist of such Person and/or such other Persons referred to in the immediately preceding clause (a).

        "Representative" means the trustee, agent or representative (if any) for an issue of Senior Indebtedness.

        "Restricted Investment" means any Investment other than a Permitted Investment.

        "Restricted Subsidiary" means any Subsidiary of the Company other than an Unrestricted Subsidiary.

        "Sale/Leaseback Transaction" means an arrangement relating to property now owned or hereafter acquired by the Company or a Restricted Subsidiary whereby the Company or a Restricted Subsidiary transfers such property to a Person and the Company or such Restricted Subsidiary leases it from such Person, other than (a) leases between the Company and a Wholly Owned Subsidiary or between Wholly Owned Subsidiaries or (b) any arrangement whereby the transfer involves fixed or capital assets and is consummated within 120 days after the date the Company or a Restricted Subsidiary acquires or finishes construction of such fixed or capital assets.

        "SEC" means the Securities and Exchange Commission.

        "Secondary Collateral Obligations" means the May 2003 Notes Obligations and any other Indebtedness of the Company and the Restricted Subsidiaries (other than the First-Priority Obligations and the Credit Agreement Obligations) that is secured by a Permitted Lien described in clause (1)(B) of the definition thereof and is designated by the Company as a "Secondary Collateral Obligation" for purposes of the Indenture.

        "Second-Priority Collateral" means any and all of the following assets and properties now owned or at any time hereafter acquired by the Company or any Note Guarantor and with respect to which a Lien is granted as security for the Credit Agreement Obligations or any Secondary Collateral Obligations: receivables, inventory (and Indebtedness arising from loans and advances made to enable the obligors to acquire inventory), payment intangibles (other than payment intangibles that represent tax refunds in respect of, or otherwise relate to, real property, fixtures, equipment or intellectual property), 100% of the capital stock of, or other equity interests in, existing and future Domestic Subsidiaries and Foreign Subsidiaries that are Note Guarantors, and 65% of the capital stock or other equity interests in, existing and future first-tier Foreign Subsidiaries (other than Foreign Subsidiaries that are Note Guarantors), credit card proceeds, investment property, other financial assets, instruments, deposit, securities and commodity accounts (and the cash and other assets contained

130

therein), hedging, commodity and other derivative contracts (and cash and other deposits securing the same), all permits and licenses related to the foregoing (other than permits and licenses related to the ownership or operation of real property, fixtures, equipment or intellectual property), all books and records relating to the foregoing, all general intangibles, chattel paper, instruments and documents to the extent evidencing, governing, securing or otherwise related to the foregoing and all products and proceeds of the foregoing in whatever form received, including proceeds of insurance policies related to the foregoing (including proceeds of business interruption insurance to the extent related to the first 45 days of the covered period for any business interruption), but excluding the Notes Collateral Account (and any cash or other assets held therein in accordance with the Indenture or the Security Documents).

        "Second-Priority Obligations" means Indebtedness of the Company and the Restricted Subsidiaries (other than the Senior Secured Discount Notes and the Other First-Priority Obligations) including principal, premium (if any), interest (including interest accruing on or after the filing of any petition in bankruptcy or for reorganization relating to the Company or any Note Guarantor whether or not a claim for post-filing interest is allowed in such proceedings), fees, charges, expenses, reimbursement obligations, guarantees and all other amounts payable thereunder or in respect thereof that is secured by a security interest in the First-Priority Collateral by a Permitted Lien described in clause (1)(A) of the definition thereof.

        "Securitization Entity" means a Wholly Owned Subsidiary of the Company (or another Person in which the Company or any Subsidiary of the Company makes an Investment and to which the Company or any Subsidiary of the Company transfers accounts receivable and related assets) which engages in no activities other than in connection with the financing of accounts receivable and which is designated by the Board of Directors of the Company (as provided below) as a Securitization Entity (a) no portion of the Indebtedness or any other obligations (contingent or otherwise) of which (i) is guaranteed by the Company or any Subsidiary of the Company (excluding guarantees of obligations (other than the principal of, and interest on, Indebtedness) pursuant to Standard Securitization Undertakings), (ii) is recourse to or obligates the Company or any Subsidiary of the Company in any way other than pursuant to Standard Securitization Undertakings or (iii) subjects any property or asset of the Company or any Subsidiary of the Company, directly or indirectly, contingently or otherwise, to the satisfaction thereof, other than pursuant to Standard Securitization Undertakings, (b) with which neither the Company nor any Subsidiary of the Company has any material contract, agreement, arrangement or understanding other than on terms no less favorable to the Company or such Subsidiary than those that might be obtained at the time from Persons that are not Affiliates of the Company, other than fees payable in the ordinary course of business in connection with servicing receivables of such entity and (c) to which neither the Company nor any Subsidiary of the Company has any obligation to maintain or preserve such entity's financial condition or cause such entity to achieve certain levels of operating results. Any such designation by the Board of Directors of the Company shall be evidenced to the Trustee, by filing with the Trustee a certified copy of the resolution of the Board of Directors giving effect to such designation and an Officers' Certificate certifying that such designation complied with the foregoing conditions.

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        "Senior Indebtedness" of the Company or any Note Guarantor, as the case may be, means the principal of, premium (if any) and accrued and unpaid interest on (including interest accruing on or after the filing of any petition in bankruptcy or for reorganization of the Company or any Note Guarantor, as applicable, regardless of whether or not a claim for post-filing interest is allowed in such proceedings), and fees and other amounts owing in respect of, Bank Indebtedness, the Senior Secured Discount Notes (in the case of the Company), the Note Guarantees (in the case of the Note Guarantors), Other First-Priority Obligations and all other Indebtedness of the Company or any Note Guarantor, as applicable, whether outstanding on the Closing Date or thereafter Incurred, unless in the instrument creating or evidencing the same or pursuant to which the same is outstanding it is provided that such obligations are subordinated in right of payment to the Senior Secured Discount Notes or such Note Guarantor's Note Guarantee.

        "Senior Subordinated Notes" of the Company means the $220,000,000 aggregate principal amount of the Company's 13% senior subordinated notes due 2010 issued by the Company on May 31, 2000 and the $100,000,000 aggregate principal amount of the Company's 13% senior subordinated notes due 2010 issued by the Company on April 10, 2002, in each case together with the new notes issued in respect thereof, in such case, to the extent outstanding.

        "Senior Subordinated Notes Indentures" means the indentures dated as of May 31, 2000, and April 10, 2002, among the Company, the subsidiary guarantors party thereto and The Bank of New York, as trustee, under which the Company's Senior Subordinated Notes were issued, each as amended, modified or supplemented from time to time.

        "Significant Subsidiary" means any Restricted Subsidiary that would be a "Significant Subsidiary" of the Company within the meaning of Rule 1-02 under Regulation S-X promulgated by the SEC.

        "Standard Securitization Undertakings" means representations, warranties, covenants and indemnities entered into by the Company or any Subsidiary of the Company which are reasonably customary in an accounts receivable securitization transaction.

        "Stated Maturity" means, with respect to any security, the date specified in such security as the fixed date on which the final payment of principal of such security is due and payable, including pursuant to any mandatory redemption provision (but excluding any provision providing for the repurchase of such security at the option of the holder thereof upon the happening of any contingency beyond the control of the issuer unless such contingency has occurred).

        "Stockholders Agreement" means the Stockholders Agreement among the Company and the holders of the Company's Capital Stock party thereto, as in effect on the Closing Date as amended from time to time, so long as the Permitted Holders own a majority of the Capital Stock subject to such agreement.

        "Subordinated Obligation" means any Indebtedness of the Company (whether outstanding on the Closing Date or thereafter Incurred) that is subordinate or junior in right of payment to the Senior Secured Discount Notes pursuant to a written agreement. "Subordinated Obligation" of a Note Guarantor has a correlative meaning.

        "Subsidiary" of any Person means any corporation, association, partnership, limited liability company or other business entity of which more than 50% of the total voting power of shares of Capital Stock or other interests (including partnership interests) entitled (without regard to the occurrence of any contingency) to vote in the election of directors, representatives, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by:

(1)

such Person;



(2)

such Person and one or more Subsidiaries of such Person; or

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(3)

one or more Subsidiaries of such Person.

        "Tangible Assets" means Total Assets less Intangible Assets.

        "Temporary Cash Investments" means any of the following:

(1)

any investment in direct obligations of the United States of America or any agency or instrumentality thereof or obligations Guaranteed or insured by the United States of America or any agency or instrumentality thereof;



(2)

investments in checking accounts, savings accounts, time deposit accounts, certificates of deposit, bankers' acceptances and money market deposits maturing within 360 days of the date of acquisition thereof issued by a bank or trust company that is organized under the laws of the United States of America, any state thereof or any foreign country recognized by the United States of America having capital, surplus and undivided profits aggregating in excess of $250,000,000 (or the foreign currency equivalent thereof) and whose long-term debt is rated "A" (or such similar equivalent rating) or higher by at least one nationally recognized statistical rating organization (as defined in Rule 436 under the Securities Act);



(3)

repurchase obligations with a term of not more than 30 days for underlying securities of the types described in clause (1) above entered into with a bank meeting the qualifications described in clause (2) above;



(4)

investments in commercial paper, maturing not more than 270 days after the date of acquisition, issued by a corporation (other than an Affiliate of the Company) organized and in existence under the laws of the United States of America or any foreign country recognized by the United States of America with a rating at the time as of which any investment therein is made of "P-1" (or higher) according to Moody's Investors Service, Inc. or "A-1" (or higher) according to Standard and Poor's Ratings Service, a division of The McGraw-Hill Companies, Inc. ("S&P");



(5)

investments in securities with maturities of six months or less from the date of acquisition issued or fully guaranteed by any state, commonwealth or territory of the United States of America, or by any political subdivision or taxing authority thereof, and rated at least "A" by S&P or "A" by Moody's Investors Service, Inc.; and



(6)

investments in money market funds that invest substantially all of their assets in securities of the types described in clauses (1) through (5) above.

        "TIA" means the Trust Indenture Act of 1939 (15 U.S.C.—77aaa-77bbbb) as in effect on the Closing Date.

        "Total Assets" means the total consolidated assets of the Company and its Restricted Subsidiaries, as shown on the most recent balance sheet of the Company.

        "Trade Payables" means, with respect to any Person, any accounts payable or any indebtedness or monetary obligation to trade creditors created, assumed or Guaranteed by such Person arising in the ordinary course of business in connection with the acquisition of goods or services.

        "Trustee" means the party named as such in the Indenture until a successor replaces it and, thereafter, means the successor.

        "Trust Officer" means the Chairman of the Board, the President or any other officer or assistant officer of the Trustee assigned by the Trustee to administer its corporate trust matters.

        "UCC" means the Uniform Commercial Code as from time to time in effect in the State of New York.

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        "Unrestricted Subsidiary" means:

(1)

Pliant Investment, Inc. and any Subsidiary of the Company that at the time of determination shall be designated an Unrestricted Subsidiary by the Board of Directors in the manner provided below; and



(2)

any Subsidiary of an Unrestricted Subsidiary.

        The Board of Directors may designate any Subsidiary of the Company (including any newly acquired or newly formed Subsidiary of the Company), to be an Unrestricted Subsidiary unless such Subsidiary or any of its Subsidiaries owns any Capital Stock in or Indebtedness of, or owns or holds any Lien on any property of, the Company or any other Subsidiary of the Company that is not a Subsidiary of the Subsidiary to be so designated; provided, however, that the Subsidiary to be so designated at the time of designation has total Consolidated assets of $1,000 or less or

        The Board of Directors may designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided, however, that immediately after giving effect to such designation no Default shall have occurred and be continuing.

        Any such designation of a Subsidiary as a Restricted Subsidiary or Unrestricted Subsidiary by the Board of Directors shall be evidenced to the Trustee by promptly filing with the Trustee a copy of the resolution of the Board of Directors giving effect to such designation and an Officers' Certificate certifying that such designation complied with the foregoing provisions.

        "U.S. Government Obligations" means direct obligations (or certificates representing an ownership interest in such obligations) of the United States of America (including any agency or instrumentality thereof) for the payment of which the full faith and credit of the United States of America is pledged and which are not callable or redeemable at the issuer's option.

        "Voting Stock" of a Person means all classes of Capital Stock or other interests (including partnership interests) of such Person then outstanding and normally entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof.

        "Wholly Owned Subsidiary" means a Restricted Subsidiary of the Company all the Capital Stock of which (other than directors' qualifying Capital Stock) is owned by the Company or another Wholly Owned Subsidiary.

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BOOK-ENTRY SETTLEMENT AND CLEARANCE

The global notes

        The Senior Secured Discount Notes are represented by one or more permanent global notes in definitive, fully registered book-entry form, without interest coupons that will be deposited with, or on behalf of, DTC and registered in the name of DTC or its nominee, on behalf of the acquirers of New Notes represented thereby for credit to the respective accounts of the acquirers, or to such other accounts as they may direct, at DTC.

        Except as set forth below, the global notes may be transferred, in whole and not in part, solely to another nominee of DTC or to a successor of DTC or its nominee. Beneficial interests in the global notes may not be exchanged for notes in physical, certificated form except in the limited circumstances described below.

        All interests in the global notes may be subject to the procedures and requirements of DTC.

Certain book-entry procedures for the global notes

        The descriptions of the operations and procedures of DTC set forth below are provided solely as a matter of convenience. These operations and procedures are solely within the control of DTC and are subject to change by DTC from time to time. We will take no responsibility for these operations or procedures, and investors are urged to contact DTC or its participants directly to discuss these matters.

        DTC has advised us that it is

•

a limited purpose trust company organized under the laws of the State of New York,



•

a "banking organization" within the meaning of the New York Banking Law,



•

a member of the Federal Reserve System,



•

a "clearing corporation" within the meaning of the Uniform Commercial Code, as amended, and



•

a "clearing agency" registered pursuant to Section 17A of the Exchange Act.

        DTC was created to hold securities for its participants and facilitates the clearance and settlement of securities transactions between participants through electronic book-entry changes to the accounts of its participants, thereby eliminating the need for physical transfer and delivery of certificates. DTC's participants include securities brokers and dealers, banks and trust companies, clearing corporations and certain other organizations. Indirect access to DTC's system is also available to other entities such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a participant, either directly or indirectly. Investors who are not participants may beneficially own securities held by or on behalf of DTC only through participants or indirect participants.

        We expect that pursuant to procedures established by DTC ownership of the New Notes will be shown on, and the transfer of ownership thereof will be effected only through, records maintained by DTC (with respect to the interests of participants) and the records of participants and the indirect participants (with respect to the interests of persons other than participants).

        The laws of some jurisdictions may require that certain purchasers of securities take physical delivery of such securities in definitive form. Accordingly, the ability to transfer interests in the New Notes represented by a global note to such persons may be limited. In addition, because DTC can act only on behalf of its participants, who in turn act on behalf of persons who hold interests through participants, the ability of a person having an interest in New Notes represented by a global note to pledge or transfer such interest to persons or entities that do not participate in DTC's system, or to otherwise take actions in respect of such interest, may be affected by the lack of a physical definitive security in respect of such interest.

        So long as DTC or its nominee is the registered owner of a global note, DTC or such nominee, as the case may be, will be considered the sole owner or holder of the notes represented by the global

135

note for all purposes under the indenture. Except as provided below, owners of beneficial interests in a global note

•

will not be entitled to have New Notes represented by such global note registered in their names,



•

will not receive or be entitled to receive physical delivery of certificated New Notes, and



•

will not be considered the owners or holders thereof under the indenture for any purpose, including with respect to the giving of any direction, instruction or approval to the trustee thereunder.

        Accordingly, each holder owning a beneficial interest in a global note must rely on the procedures of DTC and, if such holder is not a participant or an indirect participant, on the procedures of the participant through which such holder owns its interest, to exercise any rights of a holder of Notes under the indenture or such global note. We understand that under existing industry practice, in the event that we request any action of holders of Notes, or a holder that is an owner of a beneficial interest in a global note desires to take any action that DTC, as the holder of such global note, is entitled to take, DTC would authorize the participants to take such action and the participants would authorize holders owning through such participants to take such action or would otherwise act upon the instruction of such holders. Neither we nor the trustee will have any responsibility or liability for any aspect of the records relating to or payments made on account of notes by DTC, or for maintaining, supervising or reviewing any records of DTC relating to such New Notes.

        Payments with respect to the principal of, and premium, if any, and interest on, any New Notes represented by a global note registered in the name of DTC or its nominee on the applicable record date will be payable by the trustee to or at the direction of DTC or its nominee in its capacity as the registered holder of the global note representing the New Notes under the indenture. Under the terms of the indenture, we and the trustee may treat the persons in whose names the New Notes, including the global notes, are registered as the owners thereof for the purpose of receiving payment thereon and for any and all other purposes whatsoever. Accordingly, neither we nor the trustee has or will have any responsibility or liability for the payment of such amounts to owners of beneficial interests in a global note (including principal, premium, if any, liquidated damages, if any, and interest). Payments by the participants and the indirect participants to the owners of beneficial interests in a global note will be governed by standing instructions and customary industry practice and will be the responsibility of the participants or the indirect participants and DTC.

        Transfers between participants in DTC will be effected in accordance with DTC's procedures, and will be settled in same-day funds.

Certificated notes

        If,

•

we notify the trustee in writing that DTC is no longer willing or able to act as a depositary or DTC ceases to be registered as a clearing agency under the Exchange Act and a successor depositary is not appointed within 90 days of such notice or cessation,



•

we, at our option, notify the trustee in writing that we elect to cause the issuance of Notes in definitive form under the indenture or



•

upon the occurrence of certain other events as provided in the indenture,

then, upon surrender by DTC of the global notes, certificated notes will be issued to each person that DTC identifies as the beneficial owner of the notes represented by the global notes. Upon any such issuance, the trustee is required to register such certificated notes in the name of such person or persons (or the nominee of any thereof) and cause the same to be delivered thereto.

        Neither we nor the trustee shall be liable for any delay by DTC or any participant or indirect participant in identifying the beneficial owners of the related notes and each such person may conclusively rely on, and shall be protected in relying on, instructions from DTC for all purposes.

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CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES

General

        This section describes certain material U.S. federal income tax consequences relating to the ownership and disposition of the Senior Secured Discount Notes. The information provided below is based on the Internal Revenue Code of 1986, as amended (the "Code"), Treasury Regulations, Internal Revenue Service ("IRS") published rulings and court decisions, all as currently in effect. These authorities may change, possibly on a retroactive basis. This summary is not binding on the Internal Revenue Service or on the courts; the IRS or courts might interpret the existing authorities differently. In either case, the tax consequences of exchanging, owning or disposing of notes could differ from those described below. We do not intend to obtain a ruling from the IRS with respect to the tax consequences of exchange, ownership or disposition of the notes.

        This description is general in nature and does not discuss all aspects of U.S. federal income taxation that may be relevant to an investor in light of the investor's particular circumstances, or to certain types of investors subject to special treatment under U.S. federal income tax laws (such as financial institutions, real estate investment trusts, regulated investment companies, grantor trusts, insurance companies, pension funds, tax-exempt organizations, expatriates, brokers, dealers or traders in securities or foreign currencies, traders in securities that elect to apply a mark-to-market method of accounting, persons holding notes as part of a position in a "straddle" or as part of a "hedging," "conversion" or "integrated" transaction for U.S. federal income tax purposes, persons deemed to sell notes under the constructive sale provisions of the Code, persons who hold notes through a partnership or other pass-through entity, persons subject to the alternative minimum tax, or U.S. Holders that have a "functional currency" other than the U.S. dollar). This description generally applies to investors who will hold the notes as "capital assets" within the meaning of Section 1221 of the Code. This description does not consider the effect of any foreign, state, local or other tax laws that may be applicable to particular investors.

        As used herein, the term "U.S. Holder" means a beneficial holder of a note that is (i) a citizen or resident of the U.S.; (ii) a corporation organized in or under the laws of the United States or any political subdivision thereof; (iii) an estate the income of which is subject to U.S. federal income taxation regardless of its source; or (iv) a trust, if such trust has made a valid election to be treated as a U.S. person for U.S. federal income tax purposes, or if (a) a court within the U.S. can exercise primary supervision over the administration of such trust and (b) one or more U.S. persons (as defined in Section 7701(a)(30) of the Code) have the authority to control all of the substantial decisions of such trust. Persons other than U.S. Holders ("Non-U.S. Holders"), as defined below, are subject to special U.S. federal income tax considerations, some of which are discussed below.

        If a partnership (including for this purpose any entity treated as a partnership for U.S. tax purposes) is a beneficial owner of the notes, the U.S. federal income tax treatment of a partner in the partnership will generally depend on the status of the partner and the activities of the partnership. A holder of the notes that is a partnership and partners in such partnership should consult their individual tax advisors about the U.S. federal income tax consequences of holding and disposing of the notes.

        Furthermore, all persons considering the ownership or disposition of the Senior Secured Discount Notes should consult their own tax advisors regarding the application of the U.S. federal income tax laws to their particular situations and the consequences of U.S. federal estate or gift tax laws, foreign, state, or local tax laws, and tax treaties.

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U.S. federal income tax consequences of owning and disposing of the Senior Secured Discount Notes

Notes issued at a discount—U.S. Holders

        The tax treatment of interest paid on a note depends on whether the interest is "qualified stated interest." Qualified stated interest is any interest on a note having a maturity of more than one year from its issue date that is payable in cash at least annually over the entire term of the note at a single rate. Because we are not obligated to pay cash interest on the notes until after December 15, 2006, none of the stated interest on the notes will constitute qualified stated interest. Instead, each note will be considered to be issued with original issue discount ("OID") equal to the excess of (i) the "stated redemption price" at maturity of the note over (ii) its "issue price." For purposes of the foregoing, the general rule is that the stated redemption price at maturity of a note is the sum of all payments provided by the note. The issue price of a note is the first price at which a substantial amount of the notes are sold. For these purposes, the issue price of a note was $736.27 per $1,000 note.

        Each U.S. Holder will be required to include in income each year, without regard to whether any cash payments of interest are made with respect to the note and without regard to the holder's method of accounting for U.S. federal income tax purposes, a portion of the OID on the note so as to provide a constant yield to maturity. The Regulations permit a holder to use accrual periods of any length from one day to one year to compute accruals of OID, provided that the yield to maturity is adjusted to reflect the yield period selected, and further provided that each scheduled payment of principal or interest occurs either on the first or the last day of an accrual period. Under these rules a holder must include in income increasingly greater amounts of OID in successive accrual periods, unless payments that are a part of the stated redemption price at maturity of a note are made before its final maturity. The amount included in the income of a U.S. Holder each year in this way will be treated as ordinary income. In compliance with U.S. Treasury Regulations, we will provide certain information to the IRS and U.S. Holders that is relevant in determining the amount of OID in each accrual period.

Sale, repurchase or redemption of the notes—U.S. Holders

        A U.S. Holder generally will recognize capital gain or loss if the U.S. Holder disposes of a note in a sale or a redemption. The U.S. Holder's gain or loss will equal the difference between the amount realized by the U.S. Holder (other than amounts attributable to accrued interest not yet taken into income, which will be treated as OID as described above) and the U.S. Holder's adjusted tax basis in the note. The U.S. Holder's adjusted tax basis in the note will generally equal the amount the U.S. Holder paid for the note, increased by the amount of any OID includible in the U.S. Holder's gross income with respect to the note and decreased by any payments on the note. Such gain or loss will generally be (i) capital gain and (ii) long-term if the holder's holding period in respect of such note is more than one year. Long-term capital gain of non-corporate taxpayers is taxed at lower rates than those applicable to ordinary income. The deductibility of capital loss is subject to certain limitations.

Information reporting and backup withholding—U.S. Holders

        Payments of interest and OID to U.S. Holders of notes generally will be subject to information reporting. In addition to other reporting obligations, we must also report certain information describing the notes to the IRS within thirty days of this exchange on Form 8281 "Information Return for Publicly Offered Original Issue Discount Instruments." Payments of interest and OID to U.S. Holders of notes generally will be subject to backup withholding unless the U.S. Holder provides us or our paying agent with a correct taxpayer identification number and the recipient has not been notified by the IRS that the recipient has failed to report interest or dividends on the recipient's returns. Any amounts withheld from a payment to a U.S. Holder under the backup withholding rules can be credited against any U.S. federal income tax liability of the U.S. Holder.

138

Non-U.S. Holders

        This subsection describes the material U.S. federal income tax consequences of the ownership of notes by a Non-U.S. Holder. Subject to the discussion below concerning backup withholding:

(a)

no withholding of U.S. federal income tax will be required with respect to the payment by us or any paying agent of principal or interest (including OID) on a note owned by a Non-U.S. Holder, provided (i) that the beneficial owner does not actually or constructively own 10% or more of the total combined voting power of all classes of our stock entitled to vote within the meaning of Section 871(h)(3) of the Code and the regulations thereunder, (ii) the beneficial owner is not a controlled foreign corporation that is related to us through stock ownership, (iii) the beneficial owner is not a bank whose receipt of interest on a note is described in Section 881(c)(3)(A) of the Code and (iv) the beneficial owner satisfies the statement requirement (described generally below) set forth in Section 871 (h) and Section 881 (c) of the Code and the regulations thereunder;



(b)

no withholding of U.S. federal income tax will be required with respect to any gain or income realized by a Non-U.S. Holder upon the sale, exchange, retirement or other disposition of a note; and



(c)

a note beneficially owned by an individual who at the time of death is a Non-U.S. Holder will not be subject to United States federal estate tax as a result of such individual's death, provided that such individual satisfies the requirements for the "portfolio interest" exception described in (a) above (without regard to the certification requirement described in (a)(iv) above) and the income on the notes was not effectively connected to the individual's conduct of a trade or business in the United States.

        To satisfy the requirement referred to in (a)(iv) above, the beneficial owner of such note, or a financial institution holding the note on behalf of such owner, must provide, in accordance with specified procedures, our paying agent with a statement to the effect that the beneficial owner is not a U.S. Holder. Currently, these requirements will be met if (1) the beneficial owner provides his name and address, and certifies, under penalties of perjury, that he is not a U.S. Holder (which certification may be made on an IRS Form W-8BEN) or (2) a financial institution holding the note on behalf of the beneficial owner certifies, under penalties of perjury, that such statement has been received by it and, when required, furnishes our paying agent with a copy thereof. The statement requirement referred to in (a)(iv) above may also be satisfied with other documentary evidence with respect to an offshore account or through certain foreign intermediaries.

        If a Non-U.S. Holder cannot satisfy the requirements of the "portfolio interest" exception described in (a) above, payments of premium, if any, and interest (including OID) made to such Non-U.S. Holder will be subject to a 30% withholding tax unless the beneficial owner of the note provides us or our paying agent, as the case may be, with a properly executed (1) IRS Form W-8BEN claiming an exemption from or reduction in withholding under the benefit of a tax treaty or (2) IRS Form W-8ECI stating the interest paid (or OID accrued) on the note is not subject to withholding tax because it is effectively connected with the beneficial owner's conduct of a trade or business in the United States. Alternative documentation may be applicable in certain situations.

        If a Non-U.S. Holder is engaged in a trade or business in the United States, and interest (including OID) on the note is effectively connected with the conduct of such trade or business, the Non-U.S. Holder, although exempt from the withholding tax discussed above, will be subject to U.S. federal income tax on such interest (including OID) on a net income basis in the same manner as if it were a U.S. Holder. In addition, if such holder is a foreign corporation, it may be subject to a branch profits tax equal to 30% (or lesser rate under an applicable treaty) of its effectively connected earnings

139

and profits for the taxable year, subject to adjustments. For this purpose, interest (including OID) on a note will be included in such foreign corporation's earnings and profits.

        Any gain or income realized upon the sale, exchange, retirement or other disposition of a note generally will not be subject to U.S. federal income tax unless (i) such gain or income is effectively connected with the conduct of a trade or business in the United States by the Non-U.S. Holder, or (ii) in the case of a Non-U.S. Holder who is an individual, such individual is present in the United States for 183 days or more in the taxable year of such sale, exchange, retirement or other disposition, and certain other conditions are met.

        Special rules may apply to certain Non-U.S. Holders, such as "controlled foreign corporations," "passive foreign investment companies" and "foreign personal holding companies," that are subject to special treatment under the Code. Such entities should consult their own tax advisors to determine the U.S. federal, state, local and other tax consequences that may be relevant to them.

Information reporting and backup withholding—Non-U.S. Holders

        Generally, we must report annually to the IRS and to a Non-U.S. Holder the amount of interest paid (including OID accrued) to such Non-U.S. Holder and the amount of tax, if any, withheld with respect to such payments. In addition, we must report certain information describing the notes to the IRS within thirty days of this exchange on Form 8281 "Information Return for Publicly Offered Original Issue Discount Instruments." Copies of the information returns reporting such interest payments, OID accruals, any withholding or other information may also be made available to the tax authorities in the country in which a Non-U.S. Holder resides under the provisions of an applicable income tax treaty.

        In general, no backup withholding will be required with respect to payments made by us or our paying agent to Non-U.S. Holders if a statement described in (a)(iv) above has been received (and the payor does not have actual knowledge or reason to know that the beneficial owner is a U.S. Holder).

        In addition, payments of the proceeds of a sale of a note within the United States or conducted through certain United States related financial intermediaries will be subject to information reporting and, depending on the circumstances, backup withholding, unless the statement described in (a)(iv) above has been received (and the payor does not have actual knowledge or reason to know that the beneficial owner is a U.S. Holder) or the holder otherwise establishes an exemption.

        Any amounts withheld under the backup withholding rules will be allowed as a refund or a credit against such holder's U.S. federal income tax liability provided the required information is furnished to the IRS.

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PLAN OF DISTRIBUTION

        This prospectus has been prepared for use by J.P. Morgan Securities Inc. in connection with offers and sales of the Senior Secured Discount Notes in market-making transactions effected from time to time. J.P. Morgan Securities Inc. may act as a principal or agent in these transactions and may receive compensation in the form of discounts and commissions. These sales will be made at prices related to prevailing market prices at the time of sale. We will not receive any of the proceeds of these sales. We have agreed to indemnify J.P. Morgan Securities Inc. against certain liabilities, including liabilities under the Securities Act, and to contribute to payments which J.P. Morgan Securities Inc. might be required to make in respect thereof.

        As of March 31, 2005, affiliates of J.P. Morgan Securities Inc., beneficially owned approximately 55% of our outstanding common stock, 74% of our detachable warrants to purchase common stock issued in connection with our preferred stock and 59% of our outstanding preferred stock, subject to certain preemptive rights with respect to 10,000 shares of preferred stock issued on March 25, 2003. In addition, certain of our directors and advisors are associated with an affiliate of J.P. Morgan Securities Inc. See "Management," "Security ownership of certain beneficial owners and management" and "Certain relationships and related transactions—Transactions between Pliant and stockholders—Credit facilities and note offerings."

        We have been advised by J.P. Morgan Securities Inc. that, subject to applicable laws and regulations, J.P. Morgan Securities Inc. currently intends to continue to make a market in the Notes. However, J.P. Morgan Securities Inc. is not obligated to do so and any such market-making may be interrupted or discontinued at any time without notice. In addition, such market-making activity will be subject to the limits imposed by the Securities Act and the Exchange Act. There can be no assurance that an active trading market for the Notes will develop or be sustained.

        On March 1, 2005, JPMorgan Chase & Co. announced that J.P. Morgan Partners, LLC will become independent when it completes the investment of its current $6.5 billion Global Fund and that the independent unit will retain portfolio management responsibility for the Global Fund and heritage investments of affiliates of J.P. Morgan Partners, LLC. However, at this time the Company has no additional information as to the impact, if any, that J.P. Morgan Partners, LLC becoming independent of JPMorgan Chase & Co. may have on the Company or its investments in the Company or on our obligation to maintain and amend a market-making prospectus for use by J.P. Morgan Securities Inc. or any successor thereto after J.P. Morgan Morgan Partners, LLC becomes independent of JPMorgan Chase & Co. See "Risk factors"—"Risks related to the Senior Secured Discount Notes—Your ability to transfer the Notes may be limited by the absence of an active trading market, and there is no assurance that any active trading market will develop for the Senior Secured Discount Notes."

LEGAL MATTERS

        The validity of the Senior Secured Discount Notes and the Note Guarantees has been passed upon for us by Sonnenschein Nath & Rosenthal LLP. In rendering its opinion, Sonnenschein Nath & Rosenthal LLP has relied upon Stewart McKelvey Stirling Scales, our special Nova Scotia counsel, for certain legal matters relating to the offering.

EXPERTS

        The consolidated financial statements and financial statement schedule for each of the three years in the period ended December 31, 2004, appearing in this prospectus and registration statement have been audited by Ernst & Young LLP, independent registered public accounting firm, as set forth in their report thereon appearing elsewhere herein, and are included in reliance upon such report given on the authority of such firm as experts in accounting and auditing.

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INDEX TO FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULE

Pliant Corporation and Subsidiaries Financial Statements:
Condensed Consolidated Balance Sheets as of March 31, 2005 and December 31, 2004	F-2
Condensed Consolidated Statements of Operations for the Three Months Ended March 31, 2005 and 2004	F-3
Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2005 and 2004	F-4
Condensed Consolidated Statement of Stockholders' Deficit for the Three Months Ended March 31, 2005	F-5
Notes to Condensed Consolidated Financial Statements	F-6
Report of Independent Registered Public Accounting Firm	F-24
Consolidated Balance Sheets as of December 31, 2004 and 2003	F-25
Consolidated Statements of Operations for the years ended December 31, 2004, 2003 and 2002	F-26
Consolidated Statements of Stockholders' Deficit for the years ended December 31, 2004, 2003 and 2002	F-27
Consolidated Statements of Cash Flows for the years ended December 31, 2004, 2003 and 2002	F-29
Notes to Consolidated Financial Statements	F-30
Financial Statement Schedule:
Schedule II—Valuation and Qualifying Accounts	S-1

F-1

PLIANT CORPORATION AND SUBSIDIARIES


CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF MARCH 31, 2005 (UNAUDITED) AND DECEMBER 31, 2004 (DOLLARS IN THOUSANDS)

				March 31, 2005			December 31, 2004
ASSETS
CURRENT ASSETS:
	Cash and cash equivalents			$	4,080		$	5,580
	Receivables, net of allowances of $4,476 and $4,489 respectively				133,534			125,395
	Inventories (Note 2)				102,741			94,300
	Prepaid expenses and other				3,962			4,032
	Income taxes receivable, net				558			361
	Deferred income taxes				10,283			11,961
			Total current assets		255,158			241,629
PLANT AND EQUIPMENT, net					294,238			297,145
GOODWILL					182,226			182,237
INTANGIBLE ASSETS, net					16,420			17,076
OTHER ASSETS					37,935			39,005
			Total assets	$	785,977		$	777,092
LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES:
	Trade accounts payable			$	101,051		$	96,282
	Accrued liabilities:
		Interest payable			17,212			12,985
		Customer rebates			6,364			8,391
		Other			40,429			43,462
	Current portion of long-term debt				1,300			1,994
			Total current liabilities		166,356			163,114
LONG-TERM DEBT, net of current portion					864,462			840,354
OTHER LIABILITIES					28,655			26,454
DEFERRED INCOME TAXES					29,524			31,433
SHARES SUBJECT TO MANDATORY REDEMPTION (Note 11)					239,217			229,910
			Total liabilities		1,328,214			1,291,265
MINORITY INTEREST					—			33
REDEEMABLE PREFERRED STOCK
	Series B 720—shares authorized, no par value, 672 and 720 shares outstanding as March 31, 2005 and December 31, 2004, respectively				109			117
REDEEMABLE COMMON STOCK—no par value; 60,000 shares authorized; 10,873 shares outstanding as of March 31, 2005 and December 31, 2004, respectively, net of related stockholders' notes receivable of $1,827 at March 31, 2005 and December 31, 2004, respectively					6,645			6,645
STOCKHOLDERS' DEFICIT:
	Common stock—no par value; 10,000,000 shares authorized, 542,638 shares outstanding at March 31, 2005 and December 31, 2004				103,376			103,376
	Warrants to purchase common stock				39,133			39,133
	Accumulated deficit				(676,402	)		(650,974	)
	Stockholders' notes receivable				(660	)		(660	)
	Accumulated other comprehensive loss				(14,438	)		(11,843	)
			Total stockholders' deficit		(548,991	)		(520,968	)
			Total liabilities and stockholders' deficit	$	785,977		$	777,092

See notes to condensed consolidated financial statements.

F-2

PLIANT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three Months Ended March 31, 2005 and 2004 (in Thousands) (Unaudited)

			Three Months Ended March 31,
			2005			2004
NET SALES			$	262,888		$	236,799
COST OF SALES				228,938			198,466
		Gross profit		33,950			38,333
OPERATING EXPENSES:
	Sales, General and Administrative			20,115			19,903
	Research and Development			2,010			1,832
	Restructuring and Other Costs (Note 3)			132			—
		Total operating expenses		22,257			21,735
OPERATING INCOME				11,693			16,598
INTEREST EXPENSE—Current and Long-term debt (Note 5, 9)				(26,384	)		(34,594	)
INTEREST EXPENSE—Dividends and accretion on Redeemable Preferred Stock (Note 11)				(9,306	)		(8,367	)
OTHER INCOME(EXPENSE)—Net				(206	)		(138	)
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES				(24,203	)		(26,501	)
INCOME TAX EXPENSE				887			1,652
LOSS FROM CONTINUING OPERATIONS				(25,090	)		(28,153	)
LOSS FROM DISCONTINUED OPERATIONS				(338	)		(2,606	)
NET LOSS			$	(25,428	)	$	(30,759	)

See notes to condensed consolidated financial statements.

F-3

PLIANT CORPORATION AND SUBSIDIARIES


CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Three Months Ended March 31, 2005 and 2004 (In Thousands) (Unaudited)

				2005			2004
Cash Flows From Continuing Operating Activities:
	Net loss			$	(25,428	)	$	(30,759	)
	Adjustments to reconcile net loss to net cash (used in)/provided by continuing operating activities:
		Depreciation and amortization			10,134			11,035
		Amortization of deferred financing costs and accretion of debt discount			8,052			12,227
		Deferred dividends and accretion on preferred shares			9,306			8,367
		Deferred income taxes			(209	)		715
		Loss from discontinued operations			338			2,606
		Gain or loss on disposal of assets			91			48
	Changes in assets and liabilities:
		Receivables			(7,614	)		(11,250	)
		Inventories			(8,366	)		3,470
		Prepaid expenses and other			60			695
		Income taxes payable/receivable			(488	)		767
		Other assets			226			(32	)
		Trade accounts payable			4,873			(868	)
		Accrued liabilities			(452	)		3,160
		Other liabilities			2,136			243
		Other			(33	)		(59	)
			Net cash (used in)/provided by continuing operating activities		(7,374	)		365
Cash Flows From Continuing Investing Activities:
	Proceeds from sale of assets				378			—
	Capital expenditures for plant and equipment				(8,954	)		(3,047	)
			Net cash used in continuing investing activities		(8,576	)		(3,047	)
Cash Flows From Continuing Financing Activities:
	Repurchase of preferred stock				(5	)		—
	Net proceeds from issuance of senior secured discount notes				—			225,299
	Payment of financing fees				(107	)		(8,664	)
	Repayments of term debt and revolver				—			(219,575	)
	Repayment of capital leases and other, net				(1,080	)		(470	)
	Proceeds from revolving debt—net				17,400			8,300
			Net cash provided by/(used in) continuing financing activities		16,208			4,890
Cash Used in Discontinued Operations					(195	)		(1,636	)
Effect of Exchange Rate Changes on Cash and Cash Equivalents					(1,563	)		(534	)
Net Increase (Decrease) in Cash and Cash Equivalents					(1,500	)		38
Cash and Cash Equivalents, Beginning of the Period					5,580			3,308
Cash and Cash Equivalents, end of the Period				$	4,080		$	3,346
Supplemental Disclosures of Cash Flow Information:
	Cash paid (received) during the period for:
		Interest		$	14,150		$	20,854
		Income taxes			1,179			819
	Other non-cash disclosure:
	Preferred Stock dividends accrued but not paid			$	8,770		$	7,922

See notes to condensed consolidated financial statements.

F-4

PLIANT CORPORATION AND SUBSIDIARIES


CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT
For the Three Months Ended March 31, 2005 (In Thousands) (Unaudited)

		Common Stock											Accumulated Other Comprehensive Loss
					Warrants to Purchase Common Stock		Accumulated Deficit			Stockholders' Notes Receivable
		Shares	Amount													Total
Balance, December 31, 2004		543	$	103,376	$	39,133	$	(650,974	)	$	(660	)	$	(11,843	)	$	(520,968	)
	Net loss							(25,428	)								(25,428	)
Foreign currency translation adjustment														(2,595	)		(2,595	)
Balance, March 31, 2005		543	$	103,376	$	39,133	$	(676,402	)	$	(660	)	$	(14,438	)	$	(548,991	)

See notes to condensed consolidated financial statements.

F-5

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," the "Company" or "we") as of the dates and for the periods presented. Results of operations for the period ended March 31, 2005 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, 2004. Certain reclassifications have been made to the condensed consolidated financial statements for the periods ended March 31, 2004 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 March 31, 2005 and December 31, 2004 consisted of the following (in thousands):

	March 31, 2005		December 31, 2004
Finished goods	$	55,530	$	47,259
Raw materials		36,377		37,595
Work-in-process		10,834		9,446
Total	$	102,741	$	94,300

3.    Restructuring and Other Costs

        Restructuring and other costs include plant closing costs (including costs related to relocation of manufacturing equipment), office closing costs and other costs related to workforce reductions. The following table summarizes restructuring and other costs for the three months ended March 31 (in thousands):

		Three Months Ended March 31,
		2005		2004
Plant Closing Costs:
	Severance	$	67	$	—
	Other plant closure costs		65		—
Total Restructuring and other costs		$	132	$	—

F-6

        The following table summarizes the roll-forward of the reserve from December 31, 2004 to March 31, 2005:

					Accruals for the Three Months Ended March 31, 2005
		12/31/2004											3/31/2005
							Other Plant Closure Costs
		# Employees Terminated	Accrual Balance		Additional Employees	Severance		Total		Payments/ Charges			# Employees Terminated	Accrual Balance
Plant Closing Costs:
Merced		54	$	1,000	—	—	—	$	—	$	—		54	$	1,000
Shelbyville		8		1,087	—	—	—		—		(130	)	8		957
Leases		—		1,614	—	—	—		—		(167	)	—		1,447
Rhode Island		49		14	—	67	65		132		(125	)	49		21
		111	$	3,715	—	67	65	$	132	$	(422	)	111	$	3,425
Office Closing and Workforce Reduction Costs:
Leases		—	$	610	—	—	—	$	—	$	(84	)	—	$	526
Severance		114		84	—	—	—		—		—		114		84
Singapore		—		127	—	—	—		—		—		—		127
		114	$	821	—	—	—	$	—	$	(84	)	114		737
Total Plant & Office Closing		225	$	4,536	—	67	65	$	132	$	(506	)	225	$	4,162
Fixed Asset Impairments related to Plant Closing								$	—		—		—	$	—
	TOTAL	225	$	4,536	—	67	65	$	132	$	(506	)	225	$	4,162

Plant Closing Costs

2005—During the first quarter of 2005, we incurred $0.1 million of security, severance and other plant closure costs associated with our Harrisville, Rhode Island facility.

        2004—During the third quarter of 2004, we closed our Harrisville, Rhode Island facility and moved its production to more modern and efficient facilities. This restructuring plan resulted in a workforce reduction of 49 positions. All restructuring plan costs are attributable to our Engineered Films segment and are anticipated to total $2.7 million, consisting primarily of fixed asset impairment of $1.4 million, equipment relocation costs of $0.4 million, severance and other personnel related costs of $0.3 million and other costs of $0.6 million.

        2003—During 2003, we accrued the present value of future lease payments on three buildings we no longer occupied. As of March 31, 2005 $1.4 million of these accruals are remaining.

Office Closing and Workforce Reduction Costs

2002—During 2002, we implemented four workforce reduction programs whereby 111 employees were terminated. Total severance costs including benefits, for these terminations was included as part of restructuring and other costs in our consolidated statement of operations for 2002. The accruals remaining at March 31, 2005 and December 31, 2004 was $0.1 million.

4.    Discontinued Operations

        On September 30, 2004, we sold substantially all of the assets of our wholly-owned subsidiary, Pliant Solutions Corporation. Pliant Solutions, previously reported as a separate operating segment, manufactured decorative and surface coverings through the conversion of various films into consumer packaged goods. These products were sold through retailers to consumers for a wide range of

F-7

applications, including shelf-lining, decorative accents, glass coverings, surface repair, resurfacing and arts and crafts projects.

        In accordance with SFAS No. 144, Accounting for the Impairment of Long-Lived Assets, Pliant Solutions is being accounted for as a discontinued operation and, accordingly, its operating results are segmented and reported as discontinued operations in the accompanying condensed consolidated statement of operations. Net sales for the three month period ended March 31, 2004 were $7.4 million. No tax benefits were recorded on the losses from discontinued operations or the loss on sale of discontinued operations as realization of these tax benefits is not certain.

5.    Interest Expense—Current and Long-Term Debt

        Interest expense—current and long-term debt in the statement of operations for the three months ended March 31, 2005 and 2004 is as follows (in thousands):

	Three Months Ended March 31,
	2005		2004
Interest expense accrued, net	$	25,205	$	23,328
Recurring amortization of financing fees		1,179		1,148
Write-off of previously capitalized financing fees and interest rate derivatives costs(a)		—		10,118
TOTAL	$	26,384	$	34,594
Cash interest payments	$	14,150	$	20,854

(a)

This write-off resulted from the repayment of our previous credit facilities in February 2004, from the net proceeds from the issuance of the senior secured discount notes and borrowings under our revolving credit facility.

6.    Equity

Stock Option Plans

        During the three months ended March 31, 2005, options to purchase 1,835 shares of our common stock were forfeited in connection with employee terminations.

        We apply Accounting Principles Board Opinion No. 25 and related interpretations in accounting for stock-based compensation plans as they relate to employees and directors. We did not have compensation expense related to stock options for the three month periods ended March 31, 2005 and March 31, 2004. Had the compensation cost for all the outstanding options been determined in accordance with SFAS No. 123, Accounting for Stock-Based Compensation, our net income (loss) for the

F-8

three month periods ended March 31, 2005 and 2004 would have been the following pro forma amounts (in thousands):

	Three Months Ended March 31,
	2005			2004
As reported	$	(25,428	)	$	(30,759	)
Pro forma stock compensation expense		(249	)		(200	)
Pro forma	$	(25,677	)	$	(30,959	)

        In December 2004, the FASB issued SFAS 123(R) (revised December 2004), Share-Based Payment, which is a revision of SFAS 123, Accounting for Stock-Based Compensation, and supersedes APB Opinion No. 25, Accounting for Stock Issued to Employees. This statement requires that the fair value at the grant date resulting from all share-based payment transactions be recognized in the financial statements. Further, SFAS 123(R) requires entities to apply a fair-value based measurement method in accounting for these transactions. The minimum value method currently used by the Company is not allowed and the Company will be required to adopt the prospective method as proscribed by SFAS 123(R). This value is recorded over the service period, which typically is the vesting period. This statement is effective no later than the beginning of the first fiscal year beginning after June 15, 2005. We are currently evaluating the provisions of SFAS 123(R), and the impact on our consolidated financial position and results of operations.

Restricted Stock

        On September 24, 2004, we adopted a 2004 Restricted Stock Incentive Plan, pursuant to which we sold shares of a newly-created, non-voting Series B Redeemable Preferred Stock for a cash purchase price of $162 per share to our President and Chief Executive Officer and selected additional officers of the Company. The purchase price was considered to approximate fair value. These shares were issued in private transactions with officers of the Company and therefore were exempt from the registration requirements of the Securities Act of 1933. The Series B Preferred Stock will be automatically converted into common equity of the Company upon the consummation of a Qualified Public Offering, defined as a sale in an underwritten public offering registered under the Securities Act of shares of capital stock of the Company resulting in aggregate proceeds (net of underwriters discounts and commissions) to the Company of not less than $100 million. During the first quarter of 2005, 48 of the total 720 shares issued to management were repurchased for $162 per share.

7.    Income Taxes

        For the three months ended March 31, 2005, income tax expense was $0.9 million on pretax losses from continuing operations of $24.2 million as compared to income tax expense of $1.7 million on pretax loss from continuing operations of $26.5 million for the three months ended March 31, 2004. Income tax benefits related to net operating losses in the United States are offset by a valuation allowance as the realization of these tax benefits is not certain. Therefore, the income tax expense in the statements of operations primarily reflects foreign income taxes. No income taxes are included in the loss from discontinued operations of $0.4 million and $2.6 million for the three months ended March 31, 2005 and March 31, 2004, respectively.

F-9

8.    Comprehensive Loss

        Other comprehensive loss for the three months ended March 31, 2005 and 2004 was ($28.0) million and ($29.3) million, respectively. The components of other comprehensive loss are net income (loss), the change in cumulative unrealized losses on derivatives recorded in accordance with Statement of Financial Accounting Standards No. 133 and foreign currency translation.

9.    Revolving Credit Facility and Issuance of Senior Secured Discount Notes Due 2009

        Long-term debt as of March 31, 2005 and December 31, 2004 consists of the following (in thousands):

	March 31, 2005			December 31, 2004
Credit Facilities:
Revolving credit facility	$	41,400		$	24,000
Senior secured discount notes at 111/8%, net of unamortized issue discount		254,514			247,641
Senior secured notes, interest at 111/8%		250,000			250,000
Senior subordinated notes, interest at 13.0% (net of unamortized issue discount, premium and discount related to warrants)		313,435			313,214
Obligations under capital leases		6,413			6,778
Insurance financing		—			715
Total		865,762			842,348
Less current portion		(1,300	)		(1,994	)
Long-term portion	$	864,462		$	840,354

Revolving Credit Facility

        On February 17, 2004, we entered into a revolving credit facility providing up to $100 million (subject to the borrowing base and other limitations described below). The revolving credit facility includes a $15 million letter of credit sub-facility, with letters of credit reducing availability under the revolving credit facility.

        The revolving credit facility is secured by a first priority security interest in substantially all our inventory, receivables and deposit accounts, 100% of the capital stock of, or other equity interests in existing and future domestic subsidiaries and foreign subsidiaries that are note guarantors, 65% of the capital stock of, or other equity interests in existing and future first-tier foreign subsidiaries, investment property and certain other assets of the Company and the note guarantors (the "Second—Priority Collateral") and a second-priority security interest in our real property, fixtures, equipment, intellectual property and other assets ("First—Priority Collateral").

        The revolving credit facility matures on February 17, 2009. The interest rates are at LIBOR plus 2.5% to 3.0% or ABR plus 1.5% to 2.0%. The average rate on borrowings outstanding during the first quarter of 2005 was 6.95%. The commitment fee for the unused portion of the revolving credit facility is 0.50% per annum.

        The borrowings under the revolving credit facility may be limited to a reduced availability. Reduced Availability is defined as: if the borrowing base is less than $110,000,000 and the Fixed Charge Coverage Ratio (FCCR) is less than 1.1, the reduced availability is the borrowing base minus

F-10

$10,000,000. Furthermore, if the FCCR is less than that prescribed in our credit agreement, RA is the lessor of the commitment or the borrowing base minus $15,000,000. As of March 31, 2005, we had approximately $49.7 million available for borrowing under our revolving credit agreement.

Issuance of 11¹/8% senior secured discount notes due 2009

        On February 17, 2004 we completed the sale of $306 million ($225.3 million of proceeds) principal amount at maturity of 11¹/8% Senior Secured Discount Notes due 2009. The proceeds of this offering and the borrowing under the revolving credit facility (discussed above) were used to repay and terminate the credit facilities that existed at December 31, 2003.

        The Senior Secured Discount Notes are secured by a first priority security interest in the First-Priority Collateral and a second priority security interest in the Second—Priority Collateral. The Senior Secured Discount Notes are guaranteed by our existing and future domestic restricted subsidiaries and certain foreign subsidiaries.

        Unless we elect to pay cash interest as described below, and except under certain limited circumstances, the notes will accrete from the date of issuance at the rate of 11¹/8% until December 15, 2006, compounded semiannually on each June 15 and December 15, commencing June 15, 2004, to an aggregate principal amount of $1,000 per note ($306.0 million in the aggregate assuming no redemption or other repayments). Commencing on December 15, 2006, interest on the notes will accrue at the rate of 11¹/8% per annum and will be payable in cash semiannually on June 15 and December 15, commencing on June 15, 2007.

        On any interest payment date prior to December 15, 2006, we may elect to commence paying cash interest (from and after such interest payment date) in which case (i) we will be obligated to pay cash interest on each subsequent interest payment date, (ii) the notes will cease to accrete after such interest payment date and (iii) the outstanding principal amount at the stated maturity of each note will equal the accreted value of such note as of such interest payment date.

        On or after June 15, 2007, we may redeem some or all of the notes at the following redemption prices (expressed as a percentage of principal amount), plus accrued and unpaid interest: 105.563% if redeemed prior to June 15, 2008; 102.781% if redeemed prior to June 15, 2009; and 100% if redeemed on or after June 15, 2009. Prior to such date, we may not redeem the notes except as described in the following paragraph.

        At any time prior to June 15, 2007, we may redeem up to 35% of the accreted value of the notes with the net cash proceeds of certain equity offerings by us at a redemption price equal to 111.125% of the accreted value thereof plus accrued interest, so long as (i) at least 65% of the accreted value of the notes remains outstanding after such redemption and (ii) any such redemption by us is made within 120 days after such equity offering.

F-11

10.    Operating Segments

        Operating segments are components of our business 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 basis that it is used internally for evaluating segment performance.

        We have four operating segments: Engineered Films, Performance Films, Industrial Films and Specialty Products Group. Sales and transfers between our segments are eliminated in consolidation. We evaluate the performance of our operating segments based on net sales (excluding inter-company sales) and segment profit. The segment profit reflects income before interest expense, income taxes, depreciation, amortization, restructuring costs and other non-cash charges and net adjustments for certain unusual items. Our reportable segments are managed separately with separate management teams, because each segment has differing products, customer requirements, technology and marketing strategies.

        Segment profit and segment assets as of and for the periods ended March 31, 2005 and 2004 are presented in the following table (in thousands). Certain reclassifications have been made to the prior year amounts to be consistent with the 2005 presentation.

			Engineered Films		Performance Films		Industrial Films		Specialty Products Group		Corporate/ Other			Total
Three Months Ended March 31, 2005
	Net sales to customers		$	59,600	$	25,027	$	72,795	$	102,826	$	2,640		$	262,888
	Intersegment sales			1,617		558		3,378		1,511		(7,064	)		—
		Total net sales		61,217		25,585		76,173		104,337		(4,424	)		262,888
	Depreciation and amortization			1,766		848		1,759		4,661		1,100			10,134
	Interest expense			163		5		86		1,317		34,119			35,690
	Segment profit			8,141		3,644		6,351		11,284		(7,667	)		21,753
	Capital expenditures			794		1,253		1,180		4,913		814			8,954
	Segment assets			129,767		69,216		112,544		379,356		95,094			785,977
Three Months Ended March 31, 2004
	Net sales to customers		$	55,385	$	25,783	$	58,277	$	96,089	$	1,265		$	236,799
	Intersegment sales			1,445		43		924		2,948		(5,360	)		0
		Total net sales		56,830		25,826		59,201		99,037		(4,095	)		236,799
	Depreciation and amortization			1,663		849		1,316		4,726		2,481			11,035
	Interest expense			158		4		0		778		42,021			42,961
	Segment profit			9,887		4,413		6,715		13,402		(6,922	)		27,495
	Capital expenditures			336		102		808		1,555		246			3,047
As of December 31, 2004
	Segment assets			140,799		68,190		105,543		375,033		87,527			777,092

F-12

        A reconciliation of the totals reported for the operating segments to the totals reported in the consolidated financial statements for the three months ended March 31, 2004 and 2005 and as of March 31, 2005 and December 31, 2004 is as follows (in thousands):

	Three Months Ended March 31,
	2005			2004
PROFIT OR LOSS
Total segment profit	$	21,753		$	27,495
Depreciation and amortization		(10,134	)		(11,035	)
Restructuring and other costs		(132	)		—
Interest expense		(35,690	)		(42,961	)
Income (loss) from continuing operations before income taxes	$	(24,203	)	$	(26,501	)

	March 31, 2005		December 31, 2004
ASSETS
Total assets for reportable segments		690,883		689,565
Other unallocated assets		95,094		87,527
Total consolidated assets	$	785,977	$	777,092

        Net sales and long-lived assets of our US and foreign operations are as follows:

			Three Months Ended March 31,
			2005		2004
Net Sales
	United States		$	210,560	$	191,690
	Foreign countries(a)			52,328		45,109
		Total	$	262,888	$	236,799

F-13

			March 31, 2005		December 31, 2004
Long-lived assets
	United States			438,209		434,645
	Foreign countries			58,249		61,813
		Total	$	496,458	$	496,458
Total assets
	United States			666,307		655,885
	Foreign countries			119,670		121,207
		Total	$	785,977	$	777,092

(a)

Foreign countries include Australia, Canada, Germany and Mexico, none of which individually represents 10% of consolidated net sales or long-lived assets.

11.    Shares Subject to Mandatory Redemption

        The Company adopted Statement of Financial Accounting Standard No. 150 ( "SFAS 150"), Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity, effective January 1, 2004. As a result, our redeemable preferred stock, which contains an unconditional mandatory redemption feature, is reflected as a liability on the balance sheet and the associated dividends and accretion are included as a part of interest expense in the statement of operations.

        In addition, as a result of adopting SFAS 150, the Company's redeemable common shares that have been put for redemption by a shareholder are reflected as a liability at fair value. The fair value was computed using the agreed upon price of the redemption times the number of shares put by the shareholder.

        The shares subject to mandatory redemption are as follow (in thousands):

	As of March 31, 2005		As of December 31, 2004
Redeemable Preferred Shares 167,000 shares authorized, 140,973 shares outstanding as of March 31, 2005 and 2004, designated as Series A, no par value with a redemption value of $1,000 per share plus accumulated dividends.	$	232,855	$	223,548
18,200 Redeemable Common Shares that have been put for redemption by a shareholder, net of a shareholder note of $2,431		6,362		6,362
Total shares subject to mandatory redemption	$	239,217	$	229,910

        The maximum cash settlement at the redemption date of June 1, 2011 (assuming no cash dividends are paid through the redemption date) is $680.6 million for the redeemable preferred shares and

F-14

$6.4 million (net of the note receivable of $ 2.4 million) for the redeemable common shares that have been put for redemption by the shareholder.

12.    Defined Benefit Plans

        The company sponsors three noncontributory defined benefit pension plans (the "United States Plans") covering domestic employees with 1,000 or more hours of service. The company funds these in accordance with the funding requirements of the Employee Retirement Income Security Act of 1974. Contributions are intended to not only provide for benefits attributed to service to date but also for those expected to be earned in the future. We also sponsor a defined benefit plan in Germany (the "Germany Plan"). For information on the Germany Plan please refer to the Company's Form 10-K for the year ended December 31, 2004. In the second quarter of 2004, the Company redesigned its retirement programs which led to the curtailment and "freeze" of the pension plan for U.S. salaried employees effective June 30, 2004.

        The consolidated accrued net pension expense for the three months ended March 31, 2005 and 2004 includes the following components (in thousands):

	Three Months Ended March 31,
	2005			2004
UNITED STATES PLANS
Service cost-benefits earned during the period	$	104		$	1,189
Interest cost on projected benefit obligation		1,195			1,374
Expected return on assets		(1,286	)		(1,105	)
Other		28			184
Total accrued pension expense	$	41		$	1,642

13.    Contingencies

        Litigation    We are involved in various litigation matters from time to time in the ordinary course of our business, including matters described in previous filings. In our opinion, none of such litigation is material to our financial condition or results of operations.

14.    Condensed Consolidating Financial Statements

        The following condensed consolidating financial statements present, in separate columns, financial information for (i) Pliant Corporation (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 "2000 Indenture") relating to Pliant's $220 million senior subordinated notes due 2010 (the "2000 Notes"), the Indenture dated April 10, 2002 (the "2002 Indenture" and, together with the 2000 Indentures the "Indentures") relating to Pliant's $100 million senior subordinated notes due 2010 (the "2002 Notes" and, together with the 2000 Notes, the "Notes"), on a combined basis, with any investments in non-guarantor subsidiaries specified in the Indentures 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 Corporation and its subsidiaries on a consolidated

F-15

basis, and (v) Pliant Corporation on a consolidated basis, in each case as of March 31, 2005 and December 31, 2004 and for the three months ended March 31, 2005 and 2004. 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 Corporation. There are no contractual restrictions limiting transfers of cash from guarantor and non-guarantor subsidiaries to Pliant Corporation, within the meaning of Rule 3-10(h)(1) of Regulation S-X. There are no contractual restrictions limiting transfers of cash from guarantor and non-guarantor subsidiaries to Pliant Corporation. 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

F-16

PLIANT CORPORATION AND SUBSIDIARIES
Condensed Consolidating Balance Sheet
As of March 31, 2005 (In Thousands) (Unaudited)

			Pliant Corporation (Parent Only)			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations			Consolidated Pliant Corporation
ASSETS
CURRENT ASSETS:
	Cash and cash equivalents		$	—		$	845		$	3,235		$	—		$	4,080
	Receivables—net			101,320			7,624			24,590			—			133,534
	Inventories			82,110			8,439			12,192			—			102,741
	Prepaid expenses and other			2,552			645			765			—			3,962
	Income taxes receivable (payable)			120			(54	)		492			—			558
	Deferred income taxes			10,663			—			(380	)		—			10,283
		Total current assets		196,765			17,499			40,894			—			255,158
PLANT AND EQUIPMENT, Net				241,579			16,074			36,585			—			294,238
GOODWILL				167,583			13,331			1,312			—			182,226
INTANGIBLE ASSETS, Net				4,966			11,404			50			—			16,420
INVESTMENT IN SUBSIDIARIES				(33,344	)		—			—			33,344			—
OTHER ASSETS				34,620			—			3,315			—			37,935
	TOTAL ASSETS		$	612,169		$	58,308		$	82,156		$	33,344		$	785,977
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES:
	Trade accounts payable		$	83,418		$	6,219		$	11,414		$	—		$	101,051
	Accrued liabilities			56,802			3,510			3,693			—			64,005
	Current portion of long-term debt			1,300			—			—			—			1,300
	Due to (from) affiliates			(138,906	)		73,915			64,991			—			—
		Total current liabilities		2,614			83,644			80,098			—			166,356
LONG-TERM DEBT—Net of current portion				864,462			—			—			—			864,462
OTHER LIABILITIES				25,852			—			2,803			—			28,655
DEFERRED INCOME TAXES				22,261			4,085			3,178			—			29,524
SHARES SUBJECT TO MANDATORY REDEMPTION				239,217			—			—			—			239,217
		Total Liabilities		1,154,406			87,729			86,079			—			1,328,214
REDEEMABLE STOCK:
	Preferred Stock			109			—			—			—			109
	Common Stock			6,645			—			—			—			6,645
		Total redeemable stock		6,754			—			—			—			6,754
STOCKHOLDERS' EQUITY (DEFICIT):
	Common stock			103,376			—			—			—			103,376
	Additional paid-in capital			—			14,020			29,302			(43,322	)		—
	Warrants			39,133			—			—			—			39,133
	Retained earnings (deficit)			(676,402	)		(44,861	)		(25,341	)		70,202			(676,402	)
	Stockholders' note receivable			(660	)		—			—			—			(660	)
	Accumulated other comprehensive loss			(14,438	)		1,420			(7,884	)		6,464			(14,438	)
		Total stockholders' equity (deficit)		(548,991	)		(29,421	)		(3,923	)		33,344			(548,991	)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)			$	612,169		$	58,308		$	82,156		$	33,344		$	785,977

F-17

PLIANT CORPORATION AND SUBSIDIARIES
Condensed Consolidating Balance Sheet
As of December 31, 2004 (In Thousands) (Unaudited)

			Pliant Corporation (Parent Only)			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations			Consolidated Pliant Corporation
ASSETS
CURRENT ASSETS:
	Cash and cash equivalents		$	—		$	704		$	4,876		$	—		$	5,580
	Receivables—net			95,439			7,861			22,095			—			125,395
	Inventories			74,672			7,411			12,217			—			94,300
	Prepaid expenses and other			2,764			370			898			—			4,032
	Income taxes receivable			138			223			—			—			361
	Deferred income taxes			12,741			—			(780	)		—			11,961
		Total current assets		185,754			16,569			39,306			—			241,629
PLANT AND EQUIPMENT, Net				240,599			17,127			39,419			—			297,145
GOODWILL				167,583			13,331			1,323			—			182,237
INTANGIBLE ASSETS, Net				5,328			11,692			56			—			17,076
INVESTMENT IN SUBSIDIARIES				(28,793	)		—			—			28,793			—
OTHER ASSETS				35,588			—			3,417			—			39,005
		TOTAL ASSETS	$	606,059		$	58,719		$	83,521		$	28,793		$	777,092
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES:
	Trade accounts payable		$	76,515		$	5,848		$	13,919		$	—		$	96,282
	Accrued liabilities			56,639			3,554			4,645			—			64,838
	Current portion of long-term debt			1,994			—			—			—			1,994
	Due to (from) affiliates			(133,109	)		75,190			57,919			—			—
		Total current liabilities		2,039			84,592			76,483			—			163,114
LONG-TERM DEBT, Net of current portion				840,354			—			—			—			840,354
OTHER LIABILITIES				23,608			—			2,846			—			26,454
DEFERRED INCOME TAXES				24,354			3,938			3,141			—			31,433
SHARES SUBJECT TO MANDATORY REDEMPTION				229,910			—			—			—			229,910
		Total liabilities		1,120,265			88,530			82,470			—			1,291,265
MINORITY INTEREST				—			—			33			—			33
REDEEMABLE STOCK:
	Preferred stock			117			—			—			—			117
	Common stock			6,645			—			—			—			6,645
		Total redeemable stock		6,762			—			—			—			6,762
STOCKHOLDERS' (DEFICIT):
	Common stock			103,376			14,020			29,302			(43,322	)		103,376
	Warrants to purchase common stock			39,133			—			—			—			39,133
	Retained earnings (deficit)			(650,974	)		(45,237	)		(22,767	)		68,004			(650,974	)
	Stockholders' notes receivable			(660	)		—			—			—			(660	)
	Accumulated other comprehensive loss			(11,843	)		1,406			(5,517	)		4,111			(11,843	)
TOTAL STOCKHOLDERS' EQUITY (DEFICIT)				(520,968	)		(29,811	)		1,018			28,793			(520,968	)
		Total liabilities and stockholders' (deficit)	$	606,059		$	58,719		$	83,521		$	28,793		$	777,092

F-18

PLIANT CORPORATION AND SUBSIDIARIES
Condensed Consolidating Income Statement
For the Three Months Ended March 31, 2005 (In Thousands) (Unaudited)

	Pliant Corporation (Parent Only)			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations			Consolidated Pliant Corporation
SALES, Net	$	219,268		$	16,706		$	34,012		$	(7,098	)	$	262,888
COST OF SALES		188,438			14,901			32,697			(7,098	)		228,938
GROSS PROFIT		30,830			1,805			1,315			—			33,950
OPERATING EXPENSES		19,395			660			2,202			—			22,257
OPERATING INCOME		11,435			1,145			(887	)		—			11,693
INTEREST EXPENSE		(34,210	)		(163	)		(1,317	)		—			(35,690	)
EQUITY IN EARNINGS OF SUBSIDIARIES		(2,198	)		—			—			2,198			—
OTHER INCOME (EXPENSE), Net		(112	)		(68	)		(26	)		—			(206	)
NET INCOME (LOSS) BEFORE INCOME TAXES		(25,085	)		914			(2,230	)		2,198			(24,203	)
INCOME TAX PROVISION		5			538			344			—			887
INCOME (LOSS) FROM CONTINUING OPERATIONS		(25,090	)		376			(2,574	)		2,198			(25,090	)
LOSS FROM DISCONTINUED OPERATIONS		(338	)		—			—			—			(338	)
NET INCOME (LOSS)	$	(25,428	)	$	376		$	(2,574	)	$	2,198		$	(25,428	)

F-19

PLIANT CORPORATION AND SUBSIDIARIES
Condensed Consolidating Income Statement
For the Three Months Ended March 31, 2004 (In Thousands) (Unaudited)

	Pliant Corporation (Parent Only)			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations			Consolidated Pliant Corporation
SALES, Net	$	194,065		$	20,034		$	28,169		$	(5,469	)	$	236,799
COST OF SALES		160,059			17,090			26,786			(5,469	)		198,466
GROSS PROFIT		34,006			2,944			1,383			—			38,333
OPERATING EXPENSES		19,034			284			2,417			—			21,735
OPERATING INCOME		14,972			2,660			(1,034	)		—			16,598
INTEREST EXPENSE		(42,025	)		(158	)		(778	)		—			(42,961	)
EQUITY IN EARNINGS OF SUBSIDIARIES		(3,272	)		—			—			3,272			—
OTHER INCOME (EXPENSE), Net		(305	)		6			161			—			(138	)
INCOME (LOSS) BEFORE INCOME TAXES		(30,630	)		2,508			(1,651	)		3,272			(26,501	)
INCOME TAX PROVISION (BENEFIT)		129			779			744			—			1,652
INCOME (LOSS) FROM CONTINUING OPERATIONS		(30,759	)		1,729			(2,395	)		3,272			(28,153	)
LOSS FROM DISCONTINUED OPERATIONS		—			(2,606	)		—			—			(2,606	)
NET INCOME (LOSS)	$	(30,759	)	$	(877	)	$	(2,395	)	$	3,272		$	(30,759	)

F-20

PLIANT CORPORATION AND SUBSIDIARIES
Condensed Consolidating Statement of Cash Flows
For the Three Months Ended March 31, 2005 (In Thousands) (Unaudited)

			Pliant Corporation (Parent Only)			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations		Consolidated Pliant Corporation
CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES			$	(7,552	)	$	834		$	(656	)	$	—	$	(7,374	)
CASH FLOWS FROM INVESTING ACTIVITIES:
	Proceeds from sale of assets			—			378			—			—		378
	Capital expenditures for plant and equipment			(8,233	)		(143	)		(578	)		—		(8,954	)
	Net cash used in investing activities			(8,233	)		235			(578	)		—		(8,576	)
CASH FLOWS FROM FINANCING ACTIVITIES:
	Payment of financing fees			(107	)		—			—			—		(107	)
	Repayment of capital leases and other, net			(1,080	)		—			—			—		(1,080	)
	Proceeds from revolving debt, net			17,400			—			—			—		17,400
	Proceeds from issuance (repurchase) of preferred stock			(5	)		—			—			—		(5	)
		Net cash provided by (used in) financing activities		16,208			—			—					16,208
CASH TO DISCONTINUED OPERATIONS				(195	)		—			—			—		(195	)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS				(228	)		(928	)		(407	)		—		(1,563	)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS				—			141			(1,641	)		—		(1,500	)
CASH AND CASH EQUIVALENTS AT BEGINNING OF THE PERIOD				—			704			4,876			—		5,580
CASH AND CASH EQUIVALENTS AT END OF THE PERIOD			$	—		$	845		$	3,235		$	—	$	4,080

F-21

PLIANT CORPORATION AND SUBSIDIARIES
Condensed Consolidating Statement of Cash Flows
For the Three Months Ended March 31, 2004 (In Thousands) (Unaudited)

			Pliant Corporation (Parent Only)			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations		Consolidated Pliant Corporation
CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES			$	(27,096	)	$	350		$	27,111		$	—	$	365
CASH FLOWS FROM INVESTING ACTIVITIES:
	Capital expenditures for plant and equipment			(1,705	)		(59	)		(1,283	)		—		(3,047	)
	Net cash used in investing activities			(1,705	)		(59	)		(1,283	)		—		(3,047	)
CASH FLOWS FROM FINANCING ACTIVITIES:
	Net proceeds from issuance of senior discount notes			225,299			—			—			—		225,299
	Payment of financing fees			(8,664	)		—			—			—		(8,664	)
	Repayment of capital leases and other, net			(470	)		—			—			—		(470	)
	Borrowings under revolver			8,300			—			—			—		8,300
	Repayment of term debt and revolver			(195,412	)		—			(24,163	)		—		(219,575	)
		Net cash provided by (used in) financing activities		29,053			—			(24,163	)		—		4,890
CASH TO DISCONTINUED OPERATIONS				—			(1,636	)		—			—		(1,636	)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS				(252	)		380			(662	)		—		(534	)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS				—			(965	)		1,003			—		38
CASH AND CASH EQUIVALENTS AT BEGINNING OF THE PERIOD				—			1,192			2,116			—		3,308
CASH AND CASH EQUIVALENTS AT END OF THE PERIOD			$	—		$	227		$	3,119		$	—	$	3,346

F-22

15.    Subsequent Events

Alliant Joint Venture

        On January 5, 2005, we terminated our joint venture with Supreme Plastics Group PLC by purchasing all of the equity interests in the joint venture Supreme Plastics Group PLC owned for $400,000. As of January 5, 2005, Alliant Company LLC became a wholly-owned subsidiary of the Company. On April 13, 2005, Pliant Corporation sold the intellectual property, working capital, and equipment assets used in the Alliant operation to an independent third party for a purchase price of $6.3 million, subject to certain adjustments with $4.6 million paid in cash at closing, $0.6 million paid 10 days after closing and $0.5 million to be paid within 70 days of closing. The remaining purchase price of $0.63 million will be paid in equal installments twelve and twenty-four months after closing. Net sales and net loss for this business during the three months ended March 31, 2005 were $0.6 million and $0.3 million, respectively, and net sales and net loss for the three months ended March 31, 2004 were $0.7 million and $0.3 million, respectively.

Consent Solicitation—11¹/8% Senior Secured Discount Notes Due 2009

        On April 8, 2005, Pliant Corporation commenced a consent solicitation relating to its 11¹/8% Senior Secured Discount Notes due 2009 seeking consents, among other things, to (i) eliminate the current requirement to pay cash interest on the notes beginning in 2007 and, in lieu thereof, pay non-cash interest in the form of additional notes through maturity and (ii) increase the interest rate and redemption prices of the notes for which consents are received. On May 6, 2005, the Company consummated this solicitation as consents to the proposed amendments were delivered with respect to $298.2 million aggregate principal amount at maturity of the notes, all of which were accepted by the company.

        As of May 6, 2005, the aggregate principal amount of the amended notes was approximately $250.6 million and equaled their accreted value immediately prior to such consummation. In addition, $7.8 million aggregate principal amount at maturity of notes with respect to which consents were not delivered remain outstanding. The company, certain of its subsidiaries and the trustee also executed an amended and restated indenture governing the amended notes and the notes with respect to which consents were not delivered. The company, certain of its subsidiaries and J.P. Morgan Securities Inc., the solicitation agent for the consent solicitation, executed a registration rights agreement with respect to the amended notes.

        As a result of the amendments approved in the consent solicitation, the interest rate of the amended notes was increased from 11¹/8% per annum to 11⁵/8% per annum. The amended notes no longer require payment of cash interest beginning in 2007. Instead, they require payment of non-cash interest in the form of additional notes through maturity. The amendments also increased the redemption prices of the amended notes. In addition, the amended and restated indenture eliminates substantially all the restrictive covenants contained in the indenture, as they relate to holders of the notes with respect to which consents were not delivered. In conjunction with these consents, the Company paid aggregate consideration of approximately $4.8 million to the consenting noteholders. The notes for which we receive the holder's consent to the proposed amendments will not be registered under the Securities Act of 1933, as amended, or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and any applicable state securities laws.

F-23

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Shareholders of
    Pliant Corporation

        We have audited the accompanying consolidated balance sheets of Pliant Corporation as of December 31, 2004 and 2003, and the related consolidated statements of operations, cash flows and changes in stockholders' equity (deficit) for each of the three years in the period ended December 31, 2004. Our audits also included the financial statement schedule listed in the Index at page F-1. These financial statements and schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits.

        We conducted our audits in accordance with auditing standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Company's internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

        In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Pliant Corporation at December 31, 2004 and 2003, and the consolidated results of their operations and their cash flows for each of the three years in the period ended December 31, 2004, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

        As discussed in Note 1 to the financial statements, effective January 1, 2004, the Company changed its method of accounting for certain financial instruments to conform with SFAS No. 150, Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity.

/s/ Ernst & Young LLP
Chicago, Illinois
March 23, 2005

F-24

PLIANT CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

As of December 31, 2004 and 2003 (Dollars in Thousands, Except per Share Data)

				2004			2003
ASSETS
CURRENT ASSETS:
	Cash and cash equivalents			$	5,580		$	3,308
	Receivables:
		Trade accounts, net of allowances of $4,489 and $4,736, respectively			117,087			95,606
		Other			8,308			12,136
	Inventories				94,300			84,125
	Prepaid expenses and other				4,032			3,809
	Income taxes receivable				361			1,436
	Deferred income taxes				11,961			9,417
	Discontinued current assets				—			15,294
			Total current assets		241,629			225,131
PLANT AND EQUIPMENT, net					297,145			315,420
GOODWILL					182,237			182,162
OTHER INTANGIBLE ASSETS, net					17,076			19,252
OTHER ASSETS					39,005			40,172
DISCONTINUED NONCURRENT ASSETS					—			4,649
			Total assets	$	777,092		$	786,786
LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES:
	Trade accounts payable			$	96,282		$	89,800
	Accrued liabilities:
		Interest payable			12,985			19,775
		Customer rebates			8,391			7,924
		Other			43,462			35,947
	Current portion of long-term debt				1,994			1,033
			Total current liabilities		163,114			154,479
LONG-TERM DEBT, net of current portion					840,354			782,624
OTHER LIABILITIES					26,454			27,493
DEFERRED INCOME TAXES					31,433			27,792
SHARES SUBJECT TO MANDATORY REDEMPTION					229,910			—
			Total liabilities		1,291,265			992,388
MINORITY INTEREST					33			291
REDEEMABLE PREFERRED STOCK:
	Series A—167,000 shares authorized, no par value, redemption and liquidation value of $1,000 per share; 140,973 shares outstanding at December 31, 2003				—			188,223
	Series B—720 shares authorized, no par value, 720 shares outstanding at December 31, 2004				117			—
REDEEMABLE COMMON STOCK—no par value; 60,000 shares authorized; 10,873 and 29,073 shares outstanding as of December 31, 2004 and December 31, 2003, respectively, net of related stockholders' notes receivable of $1,827 at December 31, 2004 and $4,258 at December 31, 2003					6,645			13,008
STOCKHOLDERS' DEFICIT:
	Common stock—no par value; 10,000,000 shares authorized, 542,638 shares outstanding as of December 31, 2004 and December 31, 2003				103,376			103,376
	Warrants to purchase common stock				39,133			39,133
	Accumulated deficit				(650,974	)		(537,052	)
	Stockholders' notes receivable				(660	)		(660	)
	Accumulated other comprehensive loss				(11,843	)		(11,921	)
			Total stockholders' deficit		(520,968	)		(407,124	)
			Total liabilities and stockholders' deficit	$	777,092		$	786,786

See notes to consolidated financial statements.

F-25

PLIANT CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

For the Years Ended December 31, 2004, 2003 and 2002 (Dollars in Thousands)

			2004			2003			2002
NET SALES			$	968,680		$	894,479		$	850,908
COST OF SALES				826,819			758,145			693,676
		Gross profit		141,861			136,334			157,232
OPERATING EXPENSES:
	Selling, general and administrative			81,058			77,976			79,422
	Research and development			6,489			7,289			8,124
	Impairment of goodwill and intangible assets			—			18,255			8,600
	Impairment of fixed assets			359			4,844			—
	Restructuring and other costs			2,108			12,607			30,066
	Provision for litigation			—			7,200			—
		Total operating expenses		90,014			128,171			126,212
OPERATING INCOME				51,847			8,163			31,020
INTEREST EXPENSE—Current and Long Term debt				(110,353	)		(96,404	)		(75,264	)
INTEREST EXPENSE—Dividends and accretion on Redeemable Preferred Stock				(35,325	)		—			—
OTHER INCOME (EXPENSE), net				(737	)		472			2,278
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES				(94,568	)		(87,769	)		(41,966	)
INCOME TAX EXPENSE (BENEFIT):
	Current			1,794			3,682			3,980
	Deferred			(205	)		1,508			(5,442	)
		Total income tax expense (benefit)		1,589			5,190			(1,462	)
LOSS FROM CONTINUING OPERATIONS				(96,157	)		(92,959	)		(40,504	)
DISCONTINUED OPERATIONS
	Loss from discontinued operations			(7,395	)		(21,343	)		(2,926	)
	Loss on sale of discontinued operations			(10,370	)		—			—
LOSS FROM DISCONTINUED OPERATIONS				(17,765	)		(21,343	)		(2,926	)
NET LOSS			$	(113,922	)	$	(114,302	)	$	(43,430	)

See notes to consolidated financial statements.

F-26

PLIANT CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)

For the Years Ended December 31, 2004, 2003 and 2002
(In Thousands)

					Class A Common Stock			Class B Common Stock							Warrants to Purchase Common Stock
											Common Stock													Accumulated Other Comprehensive Income/(Loss)
																		Accumulated Deficit			Stockholders' Notes Receivable
		Total			Shares	Amount		Shares	Amount		Shares	Amount
Balance, December 31, 2001		$	(194,543	)							543	$	103,362		$	38,715		$	(326,356	)	$	(616	)	$	(9,648	)
Comprehensive loss:
	Net loss		(43,430	)															(43,430	)
Minimum pension liability, net of taxes			(937	)																					(937	)
Fair value change in interest rate derivatives classified as cash flow hedges, net of taxes			(2,453	)																					(2,453	)
Foreign currency translation adjustment			(4,806	)																					(4,806	)
Comprehensive loss			(51,626	)
Issuance of common stock to management for warrants			—										39			(39	)
Preferred stock dividend and accretion			(24,634	)															(24,634	)
Purchase of stock by directors			63										63
Repurchase of stock from management			(88	)									(88	)
Amortization of discount on stockholder's note receivable			(44	)																		(44	)
Balance, December 31, 2002		$	(270,872	)	—	$	—	—	$	—	543	$	103,376		$	38,676		$	(394,420	)	$	(660	)	$	(17,844	)

See notes to consolidated financial statements.

F-27

PLIANT CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)

For the Years Ended December 31, 2004, 2003 and 2002 (In Thousands)

					Class A		Class B
												Warrants to Purchase Common Stock
					Common Stock		Common Stock		Common Stock											Accumulated Other Comprehensive Income/(Loss)
														Accumulated Deficit			Stockholders' Notes Receivable
		Total			Shares	Amount	Shares	Amount	Shares	Amount
Balance, December 31, 2002		$	(270,872	)	—	—	—	—	543	$	103,376	$	38,676	$	(394,420	)	$	(660	)	$	(17,844	)
Comprehensive loss:
	Net loss		(114,302	)											(114,302	)
Minimum pension liability adjustment, net of taxes			(527	)																	(527	)
Fair value change in interest rate derivatives classified as cash flow hedges, net of taxes			3,177																		3,177
Foreign currency translation adjustment			3,273																		3,273
Comprehensive loss			(108,379	)
Issuance of warrants			457										457
Preferred stock dividend and accretion			(28,330	)											(28,330	)
Balance, December 31, 2003		$	(407,124	)	—	—	—	—	543	$	103,376	$	39,133	$	(537,052	)	$	(660	)	$	(11,921	)
Comprehensive loss:
	Net loss		(113,922	)											(113,922	)
Minimum pension liability adjustment, net of taxes			(3,888	)																	(3,888	)
Fair value change in interest rate derivatives classified as cash flow hedges, net of taxes			2,220																		2,220
Foreign currency translation adjustment			1,746																		1,746
Comprehensive loss			(113,844	)
Balance, December 31, 2004		$	(520,968	)	—	—	—	—	543	$	103,376	$	39,133	$	(650,974	)	$	(660	)	$	(11,843	)

See notes to consolidated financial statements.

F-28

PLIANT CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Years Ended December 31, 2004, 2003 and 2002 (Dollars in Thousands)

					2004			2003			2002
Cash flows from operating activities:
	Net loss				$	(113,922	)	$	(114,302	)	$	(43,430	)
	Adjustments to reconcile net loss to net cash provided by (used in) continuing operating activities:
		Depreciation and amortization				41,051			46,896			45,718
		Impairment of fixed assets				359			4,844			—
		Amortization and write-off of deferred financing costs and accretion of debt discount				35,072			9,862			3,707
		Deferred dividends and accretion on preferred shares				35,325			—			—
		Deferred income taxes				(205	)		1,508			(5,442	)
		Provision for losses on accounts receivable				1,600			1,667			2,635
		Loss from discontinued operations				13,770			21,343			2,926
		Write down of impaired assets of discontinued operations				3,995			—			—
		Non-cash plant closing costs				1,443			3,260			9,727
		Write down of impaired goodwill and intangibles				—			18,255			8,600
		(Gain) or loss on disposal of assets				546			1,452			381
		Curtailment gain				1,562			—			—
		Minority Interest				(258	)		99			(79	)
		Changes in operating assets and liabilities—net of effects of acquisitions:
			Trade accounts receivable			(22,110	)		1,307			17,786
			Other receivables			3,957			2,656			(1,565	)
			Inventories			(9,059	)		4,297			1,096
			Prepaid expenses and other			(202	)		191			(556	)
			Intangible assets and other assets			2,443			(1,089	)		(4,687	)
			Trade accounts payable			6,408			(23,316	)		2,252
			Accrued liabilities			1,137			4,715			7,961
			Income taxes payable/receivable			1,258			932			145
			Other liabilities			(5,614	)		1,203			5,244
				Net cash provided by (used in) continuing operating activities		(1,444	)		(14,220	)		52,419
Cash flows from continuing investing activities:
	Capital expenditures for plant and equipment					(24,090	)		(17,039	)		(49,151	)
	Acquisitions, net of cash acquired					—			—			(23,164	)
	Proceeds from sale of assets					6,450			—			17,122
				Net cash used in continuing investing activities		(17,640	)		(17,039	)		(55,193	)
Cash flows from continuing financing activities:
	Payment of capitalized loan fees					(9,864	)		(10,801	)		(7,439	)
	Net proceeds (net of repurchases) from issuance of common stock, preferred stock and warrants					117			9,532			(3,227	)
	Proceeds from issuance of senior discount notes and subordinated debt					225,299			250,000			103,752
	Borrowings (Repayments) under revolver					24,000			49,776			—
	Repayments of term debt and revolver due to refinancing					(214,085	)		(252,500	)		(80,694	)
				Net cash provided by continuing financing activities		25,467			46,007			12,392
Cash used in discontinued operations						(4,844	)		(14,761	)		(8,866	)
Effect of exchange rate changes on cash and cash equivalents					$	733		$	1,686		$	(3,935	)
Net increase (decrease) in cash and cash equivalents						2,272			1,673			(3,183	)
Cash and cash equivalents, beginning of the year						3,308			1,635			4,818
Cash and cash equivalents, end of the year					$	5,580		$	3,308		$	1,635
Supplemental disclosures of cash flow information:
	Cash paid during the year for:
		Interest			$	80,411		$	76,341		$	69,207
		Income taxes			$	1,647		$	2,629		$	4,884

Supplemental schedule of non-cash investing and financing activities:

In 2002 we repurchased $6.5 million of redeemable common stock in exchange for the cancellation of $6.5 million of notes receivable.

See notes to consolidated financial statements.

F-29

PLIANT CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.  Summary of Significant Accounting Policies

        Nature of operations    Pliant Corporation and its subsidiaries (collectively "Pliant") produce polymer-based (plastic), value-added films for flexible packaging, personal care, medical, agricultural and industrial applications. Our manufacturing facilities are located in North America, Latin America, Germany and Australia.

        Principles of Consolidation    The consolidated financial statements include the accounts of Pliant Corporation and its subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation.

        Use of Estimates    The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

        Revenue Recognition    Sales revenue is recognized when title transfers, the risks and rewards of ownership have been transferred to the customer, the price is fixed and determinable and collection of the related receivable is probable, which is generally at the time of shipment. Revenue is reduced by rebates made to customers based on an estimate of the amount of the rebate at the time the sale is recorded.

        Accounts Receivable    Accounts receivable consist primarily of amounts due to us from our normal business activities. Accounts receivable amounts are determined to be past due when the amount is overdue based on contractual terms. We maintain an allowance for doubtful accounts to reflect the expected uncollectibility of accounts receivable based on past collection history and specific risks identified among uncollected amounts. Accounts receivable are charged off against the allowance for doubtful accounts when we have determined that the receivable will not be collected. Collateral is generally not required for accounts receivable. One customer represented approximately 6% and 5% of consolidated receivables at December 31, 2004 and 2003, respectively.

        Inventories    Inventories consist principally of finished film and packaging products and the raw materials necessary to produce them. Inventories are carried at the lower of cost (on a first-in, first-out basis) or market value. Resin costs comprise the majority of our total manufacturing costs. Resin shortages or significant increases in the price of resin could have a significant adverse effect on our business.

        Plant and Equipment    Plant and equipment are stated at cost. Depreciation is computed using the straight-line method over the estimated economic useful lives of the assets as follows:

Land improvements	20 years
Buildings and improvements	20 years
Computer Equipment and Software	3-7 years
Machinery and equipment	7-15 years
Furniture, fixtures and vehicles	3-7 years
Leasehold improvements	Lower of useful life (10-20 years or term of lease agreement)

F-30

        Maintenance and repairs are charged to expense as incurred and costs of improvements and betterments are capitalized. Upon disposal, related costs and accumulated depreciation are removed from the accounts and resulting gains or losses are reflected in operations.

        Costs incurred in connection with the construction or major rebuild of equipment are capitalized as construction in progress. No depreciation is recognized on these assets until placed in service.

        Goodwill and Other Intangible Assets    Goodwill and intangible assets deemed to have indefinite lives are no longer amortized, but are subject to an annual impairment test based on the fair value of the assets. Amortization of other intangible assets is computed using the straight-line method over the estimated economic useful lives of 5-15 years. (See Note 5)

        Impairment of Long-Lived Assets    When events or conditions indicate a potential impairment, we evaluate the carrying value of long-lived assets, including amortizable intangible assets, based upon current and expected undiscounted cash flows, and recognize an impairment when the estimated undiscounted cash flows are less than the carrying value of the asset. Measurement of the amount of impairment, if any, is based upon the difference between the asset's carrying value and fair value.

        Other Assets    Other assets consist primarily of deferred debt issuance costs, deposits, and spare parts. Deferred debt issuance costs are amortized using a straight line method which approximates the effective yield method.

        Cash and Cash Equivalents    For the purpose of the consolidated statements of cash flows, we consider short-term highly liquid investments with maturity when purchased of three months or less to be cash equivalents. Cash generated outside of the United States is generally subject to taxation if repatriated.

        Income Taxes    Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial and tax reporting purposes. The Company, like other multi-national companies, is regularly audited by federal, state and foreign tax authorities, and tax assessments may arise several years after tax returns have been filed. Accordingly, tax reserves have been recorded when, in management's judgment, it is not probable that the Company's tax position will ultimately be sustained. While predicting the outcome of the audits involves uncertainty and requires estimates and informed judgments, we believe that the recorded tax liabilities are adequate and appropriate. The judgments and estimates made at a point in time may change based on the outcome of tax audits, as well as changes to or further interpretation of regulations. Income tax expense is adjusted in the period in which these events occur or when the statute of limitations for a specific exposure item has expired.

        Derivative Financial Instruments    Our borrowings under the credit facilities are at variable rates of interest and expose us to interest rate risk. The Company periodically utilizes interest rate derivative contracts to reduce the effect of interest rate increases. (See Note 7).

        Foreign Currency Translation    The accounts of our foreign subsidiaries are translated into U.S. dollars using the exchange rate at each balance sheet date for assets and liabilities and an average exchange rate for each month for revenues, expenses, gains and losses. Where the local currency is the functional currency, translation adjustments are recorded as a separate component of stockholders'

F-31

equity (deficit). Where the U.S. dollar is the functional currency, translation adjustments are recorded in other income within current operations.

        Shipping and Handling Costs.    Shipping and handling costs are included in cost of sales.

        Accounting For Stock-Based Compensation Plans    We apply Accounting Principles Board Opinion No. 25 and related interpretations in accounting for stock-based compensation plans as they relate to employees and directors. Had compensation cost for all the outstanding options been determined in accordance with SFAS No. 123, "Accounting for Stock-Based Compensation," our net loss for the years ended December 31, 2004, 2003 and 2002 would have been the following pro forma amounts (in thousands):

	2004			2003			2002
As reported	$	(113,922	)	$	(114,302	)	$	(43,430	)
Pro forma stock compensation expense		(800	)		(773	)		(707	)
Pro forma	$	(114,722	)	$	(115,075	)	$	(44,137	)

        The fair market value of each option is estimated on the date of grant using the minimum value option-pricing model based on the following assumptions for 2004, 2003 and 2002 grants, respectively: risk free rate of return of 4.0% in 2004 and 2003 and 6.0% in 2002; expected life of 7 years to 10 years; dividend yield of 0%; and volatility of 0%, The weighted average fair value of the options as determined by the minimum value option-pricing model was $146 per share for 2004, $103 per share for 2003 and $202 per share for 2002.

        Employees    As of December 31, 2004, we had approximately 3,025 employees, of which approximately 850 employees were subject to a total of 8 collective bargaining agreements that expire on various dates between, February 28, 2005 and March 7, 2007. The collective bargaining agreement covering our Langley union employees expired on February 28, 2005. We are currently operating under an informal extension of the terms of that agreement and are in negotiations with the union for a new collective bargaining agreement. As of December 31, 2004 we had approximately 135 employees under collective bargaining agreements, including Langley, which expire in 2005.

        Reclassifications    Certain reclassifications have been made to the consolidated financial statements for comparative purposes.

        Accounting Change    The Company adopted Statement of Financial Accounting Standard No. 150 ("SFAS 150"), Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity, effective January 1, 2004. As a result, our Series A redeemable preferred stock, which has an unconditional mandatory redemption feature, was recorded as a liability on the date of adoption at fair market value. Fair market value was determined using the value of the securities on the date of issuance plus accretion of discount from the date of issuance through December 31, 2003 and the cumulative unpaid dividends from the date of issuance through December 31, 2003. In addition, effective January 1, 2004, the dividends and accretion on the preferred shares are included as a part of interest expense in the statement of operations.

        In addition, as a result of adopting SFAS 150, the Company's redeemable common shares that have been put for redemption by a shareholder were recorded as a liability at fair value. The fair value

F-32

was computed using the agreed upon price of the redemption times the number of shares put by the shareholder. As required by SFAS 150, prior periods were not restated. The shares subject to mandatory redemption are as follow (in thousands):

	As of January 1, 2004		December 31, 2004
Redeemable Preferred Shares 167,000 shares authorized, 140,973 shares outstanding as of January 1, 2004 and December 31, 2004, designated as Series A, no par value with a redemption value of $1,000 per share plus accumulated dividends.	$	188,223	$	223,548
18,200 Redeemable Common Shares that have been put for redemption by a shareholder, net of a shareholder note of $2,431		6,362		6,362
Total shares subject to mandatory redemption	$	194,585	$	229,910

        The maximum cash settlement at the redemption date of June 1, 2011 (assuming no cash dividends are paid through the redemption date) is $680.6 million for the redeemable preferred shares and $6.4 million (net of the note receivable of $2.4 million) for the redeemable common shares that have been put for redemption by the shareholder.

        New Accounting Pronouncements    In December 2004, the FASB issued SFAS 123(R) (revised December 2004), Share-Based Payment, which is a revision of SFAS 123, Accounting for Stock-Based Compensation, and supersedes APB Opinion No. 25, Accounting for Stock Issued to Employees, This statement requires that the fair value at the grant date resulting from all share-based payment transactions be recognized in the financial statements. Further, SFAS 123(R) requires entities to apply a fair-value based measurement method in accounting for these transactions. The minimum value method currently used by the Company is not allowed and the Company will be required to adopt the prospective method as proscribed by SFAS123(R). This value is recorded over the vesting period. This statement is effective for the first interim reporting period beginning after June 15, 2005. We are currently evaluating the provisions of SFAS 123(R), and the impact on our consolidated financial position and results of operations.

2.  Inventories

        Inventories consisted of the following at December 31 (in dollars in thousands):

	2004		2003
Finished goods	$	47,259	$	49,880
Raw materials and other		37,595		27,066
Work-in-process		9,446		7,179
Total	$	94,300	$	84,125

F-33

3.  Restructuring and Other Costs

        Restructuring and other costs include plant closing costs (including costs related to relocation of manufacturing equipment), charges for impairment of fixed assets related to plant closures, office closing costs and other costs related to workforce reductions. The following table summarizes restructuring and other costs for the three years ended December 31 (in dollars in thousands):

		2004		2003		2002
Plant Closing Costs:
	Severance	$	206	$	263	$	2,511
	Relocation of production lines		36		1,452		2,955
	Leases		—		1,903		—
	Other plant closing costs		437		4,130		9,077
Office closing and workforce reduction costs
	Severance		—		660		6,551
	Leases		—		1,357		—
	Other office closure costs		—		188		352
Total Plant/Office			679		9,953		21,446
	Fixed asset impairments related To plant closures		1,429		2,654		8,620
Total Restructuring and other costs		$	2,108	$	12,607	$	30,066

        Restructuring and other costs for the year ended December 31, 2004 included $1.4 million for fixed asset impairment charges, $0.2 million in severance and $0.5 million in other costs related to the closure of our facility in Harrisville, Rhode Island.

        Restructuring and other costs for the year ended December 31, 2003 included $2.0 million for fixed asset impairment charges related to the closure of our facility in Shelbyville, IN, $0.7 million related to the closure of our facility in Brazil consisting primarily of fixed asset impairment charges, $2.6 million related to the closure and transfer of the production from our facility in Fort Edward, NY to our facilities in Mexico and Danville, KY, $1.4 million related to the consolidation of two plants in Mexico, $2.6 million related to the closure and transfer of production from our Merced, CA facility, and other costs related to the closure of our Shelbyville, IN facility, our Singapore office and a section of our Toronto facility. In addition, during 2003 we accrued the present value of future lease payments on three buildings we do not currently occupy in an amount equal to $3.3 million.

        Restructuring and other costs for the year ended December 31, 2002 included $16.8 million related to the closure of our plant in Merced, CA, a portion of our plant in Shelbyville, IN, a part of our plant in Toronto, Canada, one of our plants in Mexico, and our Fort Edward, NY facility (acquired as part of the Decora acquisition). In addition, these costs reflect $7.9 million for the costs of relocating several of our production lines related to plant closures and costs associated with production rationalizations at several plants. Restructuring and other costs for 2002 also include $5.3 million related to severance costs, including benefits for several companywide workforce reduction programs that were completed in 2002.

F-34

        The following table summarizes the roll-forward of the reserve from December 31, 2003 to December 31, 2004 (dollars in thousands):

					Accruals for the Year Ended December 31, 2004
		12/31/2003																	12/31/04
												Other Plant Closure Costs
		# Employees Terminated	Accrual Balance		Additional Employees	Severance		Relocated Production Lines		Leases				Total		Payments/ Charges			# Employees Terminated	Accrual Balance
Plant Closing Costs:
Merced		54	$	1,235	—	$	—	$	—	$	—	$	—	$	—	$	(235	)	54	$	1,000
Rhode Island		—		—	49		206		36		—		437		679		(665	)	49		14
Shelbyville		8		1,606	—		—		—		—		—		—		(519	)	8		1,087
Leases		—		2,004	—		—		—		—		—		—		(390	)	—		1,614
		62	$	4,845	49	$	206	$	36	$	—	$	437	$	679	$	(1,809	)	111	$	3,715
Office Closing and Workforce Reduction Costs:
Leases		—	$	1,129	—	$	—	$	—	$	—	$	—	$	—	$	(519	)	—	$	610
Severance		114		237	—		—		—		—		—		—		(153	)	114		84
Singapore		—		152	—		—		—		—		—		—		(25	)	—		127
		114	$	1,518	—	$	—	$	—	$	—	$	—	$	—	$	(697	)	114	$	821
Subtotal Plant/Office		176	$	6,363	49	$	206	$	36	$	—	$	437	$	679	$	(2,506	)	225	$	4,536
Fixed Asset Impairments related to Plant Closures:
Rhode Island		—		—	—		—		—		—		—	$	1,429		—		—		—
		—		—	—		—		—		—		—	$	1,429		—		—		—
	TOTAL	176	$	6,363	49	$	206	$	36	$	—	$	437	$	2,108	$	(2,506	)	225	$	4,536

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        The following table summarizes the roll-forward of the reserve from December 31, 2002 to December 31, 2003 (dollars in thousands):

					Accruals for the Year Ended December 31, 2003
		12/31/2002																			12/31/03
														Other Plant Closure Costs
		# Employees Terminated	Accrual Balance		Additional Employees		Severance			Relocated Production Lines		Leases				Total		Payments/ Charges			# Employees Terminated	Accrual Balance
Plant Closing Costs:
Merced		54	$	1,527	(44	)	$	—		$	725	$	—	$	1,825	$	2,550	$	(2,842	)	10	$	1,235
Toronto		18		124	(18	)		28			114		—		44		186		(310	)	—		—
Shelbyville		12		2,451	(12	)		(48	)		87		—		327		366		(1,211	)	—		1,606
Mexico—Solutions		—		—	—			134			526		—		746		1,406		(1,406	)	—		—
Clearfield		—		641	—			—			—		1,903		—		1,903		(540	)	—		2,004
Mexico		—		—	—			223			—		—		1,188		1,411		(1,411	)	—		—
		84	$	4,743	(74	)	$	337		$	1,452	$	1,903	$	4,130	$	7,822	$	(7,720	)	10	$	4,845
Office Closing and Workforce Reduction Costs:
Leases		—	$	430	—		$	—		$	—	$	1,357	$	—	$	1,357	$	(658	)	—	$	1,129
Severance		90		3,580	(86	)		586			—		—		—		586		(3,929	)	4		237
Singapore		—		—	—			—			—		—		188		188		(36	)	—		152
		90	$	4,010	(86	)	$	586		$	—	$	1,357	$	188	$	2,131	$	(4,623	)	4	$	1,518
Subtotal Plant/Office		174	$	8,753	(160	)	$	923		$	1,452	$	3,260	$	4,318	$	9,953	$	(12,343	)	14	$	6,363
Fixed Asset Impairments related to Plant Closures:
Shelbyville		—		—	—			—			—		—		—	$	1,958		—		—		—
Brazil		—		—	—			—			—		—		—	$	696		—		—		—
		—		—	—			—			—		—		—	$	2,654		—		—		—
	TOTAL	174	$	8,753	(160	)	$	923		$	1,452	$	3,260	$	4,318	$	12,607	$	(12,343	)	14	$	6,363

Plant Closing Costs:

2004—During the third quarter of 2004, we closed our Harrisville, Rhode Island facility and moved its production to more modern and efficient facilities. It is anticipated that this restructuring plan will result in a workforce reduction of 49 positions, all of which were effective by December 31, 2004. All restructuring plan costs are attributable to our Engineered Films segment and are anticipated to total 2.7 million, consisting primarily of fixed asset impairment charges of $1.4 million, equipment relocation costs of $0.4 million, severance and other personnel related costs of $0.3 million and other costs of $0.6 million.

        2003—During 2003, we accrued the present value of future lease payments on three buildings we no longer occupied in an amount equal to $3.3 million. As of December 31, 2004 $2.2 million of these accruals are remaining

        2002—In September 2002, we approved a plan to close our production facility in Merced, California and relocate its production lines to our plants in Toronto, Canada and Danville, Kentucky. As of December 31, 2002, we accrued $1.6 million as part of plant closing costs for the severance

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expenses related to the closure of the Merced facility. The cost of relocating the production lines are expensed to plant closing costs as incurred. In October 2002, we approved a plan to close our production facility in Shelbyville, Indiana and consolidate its production lines with our Alliant joint venture. As of December 31, 2002 we accrued $0.7 million as part of plant closing costs for severance expenses. Other costs are expensed to our plant closing costs as incurred. The Shelbyville closure and the Merced closure were completed in the first quarter of 2003. As of December 31, 2004, the $1.0 million remaining reserves for Merced relate to environmental cleanup and the $1.1 million in Shelbyville for remaining future lease payments.

        In addition, we commenced a process in 2002 to consolidate our two plants in Mexico. The cost of relocating the production lines was expensed to plant closing costs as incurred. We also incurred $2.3 million in plant closure costs in connection with the closing of our Fort Edward, New York facility and moving production to our facilities in Mexico and Danville, Kentucky. We also made certain production rationalizations at our Toronto, Canada plant and Calhoun, Georgia plant. There are no remaining accruals as of December 31, 2003.

        As a part of the 2001 Uniplast acquisition the Company approved a plan to close three Uniplast production facilities and reduce the sales and administrative personnel. As of December 31, 2002 the closure of the production plants and reduction of sales and administrative personnel were complete. Severance costs associated with this plan of $3.0 million were accrued as a part of the cost of the acquisition. The cost of relocating production lines to existing Company locations was expensed to plant closing costs as incurred. The Company incurred approximately $3.9 million for these relocation costs in 2002. There is no accrual remaining at December 31, 2002.

        In connection with the closure of our Shelbyville facility in 2002, we determined that the values of several assets relating to this facility were impaired. This facility manufactured re-closable bags and was part of our Specialty Products Group segment. We closed this facility due to low sales volumes of re-closable bags. The impairment charges totaled $7.9 million, consisting of $5.2 million for equipment, $2.3 million for patents, moulds and intangible assets, and $0.4 million for the plant building. The $4.5 million of other closure costs associated with the closure of the Shelbyville facility consisted of $2.1 million relating to the write off of an equipment lease, $1.5 million of obsolete inventory that was written off, $0.3 million of accounts receivable that were written off and $0.6 million of labor and other costs related to an orderly shut down of the facility. The Shelbyville plant had a pre-tax loss of $1.9 million during the year ended December 31, 2002.

Office Closings and Workforce Reduction Costs

2002  During the year ended December 31, 2002, we implemented four workforce reduction programs. During the year ended December 31, 2002, 111 employees were terminated, resulting in an estimated annual cost saving, including benefits, of $10.1 million. Total severance cost, including benefits, for these terminations was $6.9 million. The accruals remaining at December 31, 2004, 2003 and 2002 were $0.1 million, $0.2 million and $3.6 million, respectively.

        Total plant closing costs and severance and related costs resulting from the 2002 workforce reductions discussed above have been included as part of restructuring and other costs in the consolidated statement of operations for the year ended December 31, 2002.

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        As of December 31, 2002, all of the expected employee terminations had been completed in connection with the workforce reduction, closure of the Salt Lake City and the closure of the Dallas offices.

4.  Discontinued Operations

        In May 2002, we acquired substantially all of the assets and assumed certain liabilities of Decora Industries, Inc. and its operating subsidiary, Decora Incorporated (collectively, "Decora"), a New York based manufacturer and reseller of printed, plastic films, including plastic films and other consumer products sold under the Con-Tact® brand name for approximately $23.2 million and formed a new wholly-owned subsidiary, Pliant Solutions Corporation. The purchase price was negotiated with the creditors committee and was paid in cash using borrowings from our existing revolving credit facility.

        On September 30, 2004, we sold substantially all of the assets of Pliant Solutions Corporation. Pliant Solutions, previously reported as a separate operating segment, manufactured decorative and surface coverings through the conversion of various films into consumer packaged goods. These products were sold through retailers to consumers for a wide range of applications, including shelf-lining, decorative accents, glass coverings, surface repair, resurfacing and arts and crafts projects.

        In accordance with SFAS No. 144, Accounting for the Impairment of Long-Lived Assets, Pliant Solutions is being accounted for as a discontinued operation and, accordingly, its assets are segregated from continuing operations in the accompanying consolidated balance sheet, and its operating results are segmented and reported as discontinued operations in the accompanying consolidated statement of operations in all periods presented. Net sales for the nine and twelve months ended December 31, 2004 and 2003 were $22.5 million and $34.9 million, respectively. Net sales for the eight months ended December 31, 2002 were $28.3 million. No tax benefits were recorded on the losses from discontinued operations or the loss on sale of discontinued operations as realization of these tax benefits is not certain.

        The assets of Pliant Solutions were sold for $9 million, of which $6.5 million was paid in cash at closing, and $2.5 million will be paid in equal monthly installments over a 3-year period. We recognized a loss on the sale of $10.4 million.

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5.  Plant and Equipment

        The cost and the related accumulated depreciation at December 31 is as follows (in thousands):

	2004			2003
Land and improvements	$	7,729		$	7,711
Buildings and improvements		68,338			65,896
Machinery and equipment		414,695			403,451
Computer equipment and software		36,066			34,519
Furniture, fixtures and vehicles		6,369			6,361
Leasehold improvements		4,906			5,547
Construction in progress		5,586			8,379
		543,689			531,864
Less accumulated depreciation and amortization		(246,544	)		(216,444	)
Plant and equipment, net	$	297,145		$	315,420

        The depreciation expense for the years ended December 2004, 2003 and 2002 was $38.1 million, $43.7 million and $42.1 million, respectively.

        During the year ended December 31, 2004, we recorded an impairment change of $0.4 million to scrap fixed assets in our Engineered Films and Industrial Films segments. During the year ended December 31, 2003 we recorded an impairment charge to scrap unused fixed assets for $4.8 million. This impairment was a result of the lack of business in one production line in our Industrial segment, one production line in our Performance segment and several small production lines in our Specialty Products Group segment.

6.  Goodwill and Intangible Assets

        In July 2001, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards ("SFAS") No. 142 "Goodwill and Other Intangible Assets". SFAS No. 142, which was effective for fiscal years beginning after December 15, 2001, requires that ratable amortization of goodwill be replaced with periodic tests of goodwill impairment and that intangible assets, other than goodwill, which have determinable useful lives, be amortized over their useful lives. As required by SFAS 142, the Company stopped amortizing goodwill effective January 1, 2002. The Company has evaluated goodwill for impairment under SFAS 142 guidelines. The Company's annual impairment test is conducted on October 1 of each year based on a methodology including prices of comparable businesses and discounted cash flows. Based on the 2004 annual impairment test, no impairments were recorded. Based upon the 2003 annual impairment test, the Company determined that goodwill was impaired in various international operations in the Specialty Products Group, Industrial Films and Engineered Films segment, and a total of $18.2 million goodwill was written down. These impairments were a result of lower sales volumes and margins from these units. In 2002, based on this evaluation, the Company determined that the goodwill in certain units was impaired, and $8.6 million of goodwill in the Specialty Products Group was written down in the fourth quarter.

        Intangible assets, other than goodwill, that have indefinite lives are not amortized. Instead, the Company evaluates the fair value of these assets in connection with its annual impairment test on October 1 of each year. Currently, the Company does not have any intangible asset, other than goodwill, with an indefinite life.

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        We have four operating segments, all of which have goodwill. Our operating segments are consistent with our reporting units as defined in SFAS 142. Operating segments are components of our business 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. Goodwill is allocated to the segments based on fair value. As discussed in Note 15, our operating segments were reorganized in 2004 and goodwill reallocated based on fair value. The changes in the carrying value of goodwill for the year ended December 31, 2003 and 2004 were as follows (in thousands):

	Specialty Products Group			Industrial Films			Engineered Films			Performance Films		Corporate/ Other		Total
Balance as of December 31, 2002	$	138,741		$	3,394		$	43,206		$	14,996	$	—	$	200,337
Goodwill impaired		(7,162	)		(1,027	)		(9,986	)		—		—		(18,175	)
Balance as of December 31, 2003	$	131,579		$	2,367		$	33,220		$	14,996	$	—	$	182,162
Foreign exchange rate adjustment		—			75			—			—		—		75
Goodwill impaired		—			—			—			—		—		—
Balance as of December 31, 2004	$	131,579		$	2,442		$	33,220		$	14,996	$	—	$	182,237

        Other intangible assets, are as follows as of December 31 (in thousands):

	2004					2003
	Gross Carrying Value		Accumulated Amortization			Gross Carrying Value		Accumulated Amortization
Other intangible assets:
Customer lists	$	22,965	$	(8,587	)	$	22,500	$	(6,717	)
Other		22,741		(20,043	)		22,717		(19,248	)
Total	$	45,706	$	(28,630	)	$	45,217	$	(25,965	)

        The weighted average remaining amortization periods for customer lists is 8.1 and 8.7 years for 2004 and 2003, respectively. The weighted average remaining amortization periods for other intangibles is 2.6 and 2.9 years for 2004 and 2003, respectively.

        The estimated amortization for each of the next five years on the other intangible assets included above is as follows (in thousands):

Year Ending December 31
2005	$	2,461
2006		2,405
2007		2,237
2008		1,376
2009		960

        Amortization expense for other intangible assets was approximately $2.5 million, $3.2 million, and $3.6 million, for the years ended December 31, 2004, 2003 and 2002, respectively.

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7.  Long-Term Debt

        Long-term debt as of December 31, consists of the following (in thousands):

	2004			2003
Credit Facilities:
Revolver, variable interest, 6.75% as of December 31, 2004	$	24,000		$	—
Tranche A and B term loans, variable interest at a weighted average rate of 5.9% as of December 31, 2003		—			219,575
Senior secured discount notes at 111/8%, net of unamortized issue discount of $58,359		247,641			—
Senior secured notes, interest at 111/8%		250,000			250,000
Senior subordinated notes, interest at 13.0% (net of unamortized issue discount, premium and discount related to warrants of $6,786 and $7,598 at 2004 and 2003, respectively)		313,214			312,402
Obligations under capital leases		6,778			856
Insurance financing, interest at 3.03% as of December 31, 2004		715			824
Total		842,348			783,657
Less current portion		(1,994	)		(1,033	)
Long-term portion	$	840,354		$	782,624

        The scheduled maturities of long-term debt by year, as of December 31, 2004 are as follows (in thousands):

Year Ending December 31,
2005	$	1,994
2006		1,387
2007		989
2008		928
2009		523,836
Thereafter		313,214
Total debt as of December 31, 2004	$	842,348

        On February 17, 2004 we repaid the balance outstanding on the revolving credit facility and term loans that existed on that date from the proceeds of the issuance of Senior Secured Discount Notes and the revolving credit agreement discussed below.

Revolving Credit Facility

        On February 17, 2004, we entered into a revolving credit facility providing up to $100 million (subject to a borrowing base). The revolving credit facility includes a $15 million letter of credit subfacility, with letters of credit reducing availability under our revolving credit facility.

        The revolving credit facility is secured by a first priority security interest on substantially all inventory, receivables, deposit accounts, 100% of capital stock of, or other equity interests in existing

F-41

and future domestic subsidiaries and foreign subsidiaries that are note guarantors, and 65% of the capital stock of, or other equity interests in existing and future first-tier foreign subsidiaries investment property and certain other assets of the Company and the note guarantors (the "Second Priority Collateral"), and a second priority security interest in our real property, fixtures, equipment, intellectual property and other assets (the "First Priority Collateral").

        The revolving credit facility matures on February 17, 2009. The Company is subject to periodic reporting of a borrowing base consisting of eligible accounts receivable and eligible inventory. The interest rates are at LIBOR plus 2.5% to 3.0% or ABR plus 1.5% - 2.0%. The commitment fees for the unused portion of the revolving credit facility is 0.50% per annum.

        The borrowings under the revolving credit facility may be limited to a reduced availability. Reduced Availability is defined as: if the borrowing base is less than $110,000,000 and the Fixed Charge Coverage Ratio (FCCR) is less than 1.1, the reduced availability is the borrowing base minus $10,000,000. Furthermore, if the FCCR is less than that prescribed in our credit agreement, RA is the lessor of the commitment or the borrowing base minus $15,000,000. As of December 31, 2004, we had approximately $60.1 million available for borrowing under our revolving credit agreement.

Issuance of 11¹/8% Senior Secured Discount Notes due 2009

        On February 17, 2004 we completed the sale of $306 million ($225.3 million of proceeds) principal at maturity of 11¹/8% Senior Secured Discount Notes due 2009. The proceeds of this offering and the revolving credit facility (discussed above) were used to repay and terminate the credit facilities that existed at December 31, 2003.

        The Senior Secured Discount Notes are secured by a first priority security interest in the First Priority Collateral and a second priority security interest in the Second Priority Collateral. The Senior Secured Discount Notes are guaranteed by our existing and future domestic restricted subsidiaries and certain foreign subsidiaries.

        Unless we elected to pay cash interest as described below, and except under certain limited circumstances, the notes will accrete from the date of issuance at the rate of 11¹/8% until December 15, 2006, compounded semiannually on each June 15 and December 15 commencing June 15, 2004, to an aggregate principal amount of $1,000 per note ($306.0 million in the aggregate assuming no redemption or other repayments). Commencing on December 15, 2006, interest on the notes will accrue at the rate of 11¹/8% per annum and will be payable in cash semiannually on June 15 and December 15, commencing on June 15, 2007.

        On any interest payment date prior to December 15, 2006, we may elect to commence paying cash interest (from and after such interest payment date) in which case (i) we will be obligated to pay cash interest on each subsequent interest payment date, (ii) the notes will cease to accrete after such interest payment date and (iii) the outstanding principal amount at the stated maturity of each note will equal the accreted value of such note as of such interest payment date.

        On or after June 15, 2007, we may redeem some or all of the notes at the following redemption prices (expressed as a percentage of principal amount), plus accrued and unpaid interest: 105.563% if redeemed prior to June 15, 2008; 102.781% if redeemed prior to June 15, 2009; and 100% if redeemed on or after June 15, 2009. Prior to such date, we may not redeem the notes except as described in the following paragraph.

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        At any time prior to June 15, 2007, we may redeem up to 35% of the accreted value of the notes with the net cash proceeds of certain equity offerings by us at a redemption price equal to 111.125% of the accreted value thereof plus accrued interest, so long as (i) at least 65% of the accreted value of the notes remains outstanding after such redemption and (ii) any such redemption by us is made within 120 days after such equity offering.

11¹/8% Senior Secured Notes due 2009

        On May 30, 2003, we completed the sale of $250 million aggregate principal amount of our 11¹/8% Senior Secured Notes due 2009. The 11¹/8 Senior Secured Notes due 2009 mature on September 1, 2009, and interest is payable on March 1 and September 1 of each year. The net proceeds from the sale of the 11¹/8% Senior Secured Notes due 2009 were used to repay borrowings under our then existing credit facilities in accordance with an amendment to our existing credit facilities. The Senior Secured Notes due 2009 rank equally with our existing and future senior debt and rank senior to our existing and future subordinated indebtedness, including the 13% Senior Subordinated Notes due 2010. The 11¹/8% Senior Secured Notes due 2009 are secured, on a second-priority lien basis, by a substantial portion of our assets. Due to this second-priority status, the 11¹/8% Senior Secured Notes due 2009 effectively rank junior to our obligations secured by a first-priority lien on the collateral securing the 11¹/8% Senior Secured Notes due 2009 to the extent of the value of such collateral. In addition, the 11¹/8% Senior Secured Notes due 2009 effectively rank junior to any of our obligations that are secured by a lien on assets that are not part of the collateral securing the 11¹/8% Senior Secured Notes due 2009, to the extent of the value of such assets. The 11¹/8% Senior Secured Notes due 2009 are guaranteed by some of our subsidiaries.

        Prior to June 1, 2006, we may, on one or more occasions redeem up to a maximum of 35% of the original aggregate principal amount of the 11¹/8% Senior Secured Notes due 2009 with the net cash proceeds of one or more equity offerings by us at a redemption price equal to 111.125% of the principal amount thereof, plus accrued and unpaid interest. Otherwise, we may not redeem the 11¹/8% Senior Secured Notes due 2009 prior to June 1, 2007. On or after that date, we may redeem some or all of the 11¹/8% Senior Secured Notes due 2009 at the following redemption prices (expressed as a percentage of principal amount). Plus accrued and unpaid interest: 105.563% if redeemed prior to June 1, 2008; 102.781% if redeemed prior to June 1, 2009; and 100% if redeemed on or after June 1, 2009.

13% Senior Subordinated Notes due 2010

        In 2000, we issued $220 million aggregate principal amount of 13% Senior Subordinated Notes due 2010. In 2002, we issued an additional $100 million of 13% Senior Subordinated Notes due 2010. The 13% Senior Subordinated Notes due 2010 mature on June 1, 2010, and interest on the 13% Senior Subordinated Notes due 2010 is payable on June 1 and December 1 of each year. The 13% Senior Subordinated Notes due 2010 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 13% Senior Subordinated Notes due 2010 are guaranteed by some of our subsidiaries. The 13% Senior Subordinated Notes due 2010 are unsecured. We may not redeem the 13% Senior Subordinated Notes due 2010 prior to June 1, 2005. On or after that date, we may redeem the 13% Senior Subordinated Notes due 2010, in whole or in part, at the following redemption prices (expressed as percentages of principal amount), plus accrued and unpaid interest: 106.5% if redeemed prior to June 1, 2006;

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104.333% if redeemed prior to June 1, 2007; 102.167% if redeemed prior to June 1, 2008; and 100% if redeemed on or after June 1, 2008.

        The credit facilities and the indentures described above 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.

Interest Rate Risk and Derivative Instruments

        Borrowings under our credit facilities are at variable rates of interest, exposing us to the risk of increased interest rates. Our leveraged position and the covenants contained in our debt instruments may also limit our flexibility to adjust to changing market conditions and our ability to withstand competitive pressures, thus putting us at a competitive disadvantage. We may be vulnerable to a downturn in general economic conditions or in our business or be unable to carry out capital spending that is important to our growth and productivity improvement programs. Thus the Company periodically utilizes interest rate derivatives contracts to reduce the effect of interest rate increases.

        We apply SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities", as amended by SFAS No. 137 and SFAS No. 138. In accordance with these statements, we recognize the fair value of derivatives as either assets or liabilities in the balance sheet. To the extent that the derivatives qualify as a hedge, 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.

        As of December 31, 2004, we had no outstanding interest rate derivatives. The fair value of our interest rate derivative agreements reported on our consolidated balance sheet at December 31, 2003 in other liabilities is approximately $3.6 million. The effective portion of the changes in fair value of these instruments is reported in other comprehensive income. As the hedged contract matures, the gain or loss is recorded as interest expense in the consolidated statement of operations. Any changes in fair value of the ineffective portion of the instruments is reported as interest expense in the consolidated statement of operations. The ineffective portion for the years ended December 31, 2003 was not material.

        The change in accumulated derivative loss included as a part of accumulated other comprehensive loss as of December 31, is as follows (in thousands):

	2004			2003			2002
Beginning accumulated derivative loss, net of taxes	$	2,220		$	5,397		$	2,944
Change associated with current period hedge transactions		—			(3,022	)		2,674
Amount reclassified into earnings		(2,220	)		(155	)		(221	)
Ending accumulated derivative loss, net of taxes	$	—		$	2,220		$	5,397

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Interest Expense

        Interest expense—current and long-term debt in the statement of operations for 2004, 2003 and 2002 are as follows (in thousands):

	2004		2003		2002
Interest expense accrued, net	$	95,191	$	78,299	$	65,751
Recurring amortization of financing fees		4,510		5,282		4,289
Write-off of previously capitalized financing fees		7,897		5,294		—
Change in fair value and cash payment of interest rate derivatives		2,755		7,529		5,224
TOTAL	$	110,353	$	96,404	$	75,264
Cash interest payments	$	80,411	$	76,341	$	69,207

8.  Leases

        Capital Leases    We have acquired certain land, building, machinery and equipment under capital lease arrangements that expire at various dates through 2008. At December 31, the gross amounts of plant and equipment and related accumulated amortization recorded under capital leases were as follows (in thousands):

	2004			2003
Land and building	$	247		$	247
Machinery and equipment		7,317			1,072
Total assets held under capital leases		7,564			1,319
Less: accumulated amortization		(436	)		(400	)
	$	7,128		$	919

        The amortization expense is included in depreciation expense. In November of 2004, the Company entered into a capital lease of $5.1 million for a production line in our Industrial segment.

        Operating Leases We have non-cancelable operating leases, primarily for vehicles, equipment, warehouse, and office space that expire through 2014, as well as month-to-month leases. The total expense recorded under all operating lease agreements in the accompanying consolidated statements of operations is approximately $11.2 million, $12.6 million, and $10.5 million for the years ended December 31, 2004, 2003 and 2002, respectively. Future minimum lease payments under operating

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leases and the present value of future minimum capital lease payments (with interest rates between 8.9% and 11.75%) as of December 31, 2004 are as follows (in thousands):

Year Ending December 31		Operating Leases		Capital Leases
	2005	$	9,190	$	1,782
	2006		8,511		1,771
	2007		6,642		1,251
	2008		4,026		1,094
	2009		3,971		2,286
Thereafter			10,856		—
Total minimum lease payments		$	43,196	$	8,184
Amounts representing interest					(1,407	)
Present value of net minimum capital lease payments				$	6,777

        During the year ended December 31, 2002, the Company entered into a transaction in which production lines were sold for approximately $15 million ($5 million of which was retained by the lessor as a required security deposit) and leased back to the Company under an operating lease agreement. These production lines were sold for their carrying values, thus no gain or loss was recorded on the transactions.

9.  Income Taxes

        The components of income (loss) from continuing operations before income taxes for the years ended December 31 are as follows (in thousands):

	2004			2003			2002
United States	$	(82,859	)	$	(70,539	)	$	(43,551	)
Foreign		(11,709	)		(17,230	)		1,585
Total	$	(94,568	)	$	(87,769	)	$	(41,966	)

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        The following is a summary of domestic and foreign provisions for current and deferred income taxes and a reconciliation of the U.S. statutory income tax rate to the effective income tax rate.

        The provisions (benefits) for income taxes for the years ended December 31, are as follows (in thousands):

			2004			2003		2002
Current:
	Federal		$	—		$	—	$	—
	State			80			82		261
	Foreign			1,714			3,600		3,719
		Total current		1,794			3,682		3,980
Deferred:
	Federal			(1,048	)		216		(5,887	)
	State			(346	)		169		(1,848	)
	Foreign			1,189			1,123		2,293
		Total deferred		(205	)		1,508		(5,442	)
		Total income tax expense (benefit)	$	1,589		$	5,190	$	(1,462	)

        The effective income tax rate reconciliations for the years ended December 31, are as follows (in thousands):

		2004			2003			2002
Income (loss) before income taxes		$	(94,568	)	$	(87,769	)	$	(41,966	)
Expected income tax provision (benefit) at U.S. statutory rate of 35%			(33,099	)		(30,719	)		(14,688	)
Increase (decrease) resulting from:
	Goodwill		3			3,075			—
	Accrued dividends on preferred stock		12,364			—			—
	State taxes		(1,597	)		(2,304	)		(975	)
	Change in valuation allowance		15,074			20,594			7,766
	Foreign rate difference		4,277			9,755			7,761
	Other, net		4,567			4,789			(1,326	)
Total income tax expense (benefit)		$	1,589		$	5,190		$	(1,462	)
Effective income tax rate			1.7	%		5.9	%		(3.5	)%

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        Components of net deferred income tax assets and liabilities as of December 31, are as follows (in thousands):

			2004			2003
Deferred income tax assets:
	Net operating loss carry forwards		$	100,267		$	78,328
	AMT and foreign tax credit carry forwards			4,755			4,755
	Accrued pension costs			6,132			8,129
	Accrued employee benefits			7,664			4,137
	Accrued plant closing costs			1,929			2,235
	Allowance for doubtful trade accounts receivable			1,129			366
	Inventory related costs			973			2,145
	Other			2,852			5,729
				125,701			105,824
		Valuation Allowance		(61,694	)		(39,693	)
	Total deferred income tax assets			64,007			66,131
Deferred income tax liabilities:
	Tax depreciation in excess of book depreciation			(71,090	)		(76,321	)
	Amortization of intangibles			(7,329	)		(5,113	)
	Other			(5,060	)		(3,072	)
		Total deferred income tax liabilities		(83,479	)		(84,506	)
Net deferred income tax liability			$	(19,472	)	$	(18,375	)
As reported on consolidated balance sheets:
	Net current deferred income tax asset		$	11,961		$	9,417
	Net non-current deferred income tax liability			(31,433	)		(27,792	)
		Net deferred income tax liability	$	(19,472	)	$	(18,375	)

        The net operating loss carry forwards for federal tax purposes are approximately $257.1 million. These losses expire in 2020 through 2024. Due to uncertainty regarding realization, valuation allowances of approximately $55.7 million and $36.1 million in 2004 and 2003 respectively have been recorded to offset the deferred tax asset related to the net operating losses.

        The foreign tax credit carry forwards for federal tax purposes are approximately $3.6 million expiring in 2010 through 2011. Due to uncertainty regarding realization, valuation allowances of approximately $3.6 million for 2004 and 2003 has been recorded to offset the deferred tax asset related to the foreign tax credits.

        Undistributed earnings of foreign subsidiaries amounted to approximately $13.1 million as of December 31, 2004. Approximately $3.6 million is considered to be permanently invested and $9.5 million may be distributed in future years. Upon distribution of those earnings in the form of dividends or otherwise, the Company would be subject to both U.S. income taxes, subject to an adjustment for foreign tax credits, and withholding taxes payable to foreign countries. Determination of the amount of unrecognized deferred U.S. income tax liability is not practicable because of the complexities associated with the calculation.

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        On October 22, 2004, the President signed the American Jobs Creation Act of 2004 (the "Act"). The Act creates a temporary incentive for U. S. corporations to repatriate accumulated income earned abroad by providing an 85% dividends received deduction for certain dividends from controlled foreign corporations. The deduction is subject to a number of limitations and, as of today, uncertainty remains as to how to interpret numerous provisions in the Act.

10.  Employee Benefit Plans

        Defined Contribution Plan    We sponsor a salary deferral plan covering substantially all of our non-union domestic employees. Plan participants may elect to make voluntary contributions to this plan up to 15% of their compensation. We contribute up to 1% of the participants' compensation based on our profits and also match employee contributions up to 2% of the participants' compensation. We expensed approximately $1.7 million, $2.0 million and $2.4 million as our contribution to this plan for the years ended December 31, 2004, 2003 and 2002, respectively.

        Defined Benefit Plans    We sponsor three noncontributory defined benefit pension plans (the "United States Plans") covering domestic employees with 1,000 or more hours of service. We fund our plans in amounts to fulfill the minimumfunding requirements of the Employee Retirement Income Security Act of 1974. Contributions are intended to not only provide for benefits attributed to service to date but also for those expected to be earned in the future. In the second quarter of 2004, the Company redesigned its retirement programs which led to the curtailment and "freeze" of the pension plan for U.S. salaried employees effective June 30, 2004. As a result, a curtailment gain of $1.6 million was recognized as income in 2004. We also sponsor a defined benefit plan in Germany (the "Germany Plan").

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        The consolidated accrued net pension expense for the years ended December 31, 2004, 2003 and 2002 includes the following components (in thousands):

	2004			2003			2002
United States Plans
Service cost-benefits earned during the period	$	2,583		$	4,474		$	3,845
Interest cost on projected benefit obligation		4,970			5,157			4,582
Expected return on assets		(4,560	)		(3,476	)		(3,698	)
Curtailment gain		(1,562	)		—			—
Other		372			517			160
Total accrued pension expense	$	1,803		$	6,672		$	4,889
Germany Plan
Service cost-benefits earned during the period	$	112		$	98		$	82
Interest cost on projected benefit obligation		115			93			80
Total accrued pension expense	$	227		$	191		$	162

Employer Contributions
2005 Expected to plan trusts	$3,067
Expected Benefit Payments
2005	$2,765
2006	2,861
2007	3,042
2008	3,226
2009	3,394
2010-2014	20,888

	2004		2003		2002
Weighted-Average Assumptions Used to Determine Net Cost
Discounted rate	6.25	%	6.75	%	7.25	%
Expected return on plan assets	9.00	%	9.00	%	9.00	%
Rate of compensation increase (non-union plans)	4 .0	%	4.0	%	4.0	%

Long-Term Rate Investment Return Assumption

        The rate of investment return assumption was developed through analysis of historical market returns, current market conditions, and the fund's past experience. Estimates of future market returns by asset category are lower than actual long-term historical returns in order to generate a conservative forecast. Overall, it was projected that funds could achieve a 9.00% return over time.

Investment Strategy

        Our investment portfolio contains a diversified blend of equity and debt securities. Furthermore, equity investments are diversified across domestic and international stocks as well as large and small capitalizations. Investment risk is measured and monitored on an ongoing basis through quarterly

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investment portfolio reviews. The target allocation of equity securities is 70 percent of the plan assets. The target allocation of debt securities is 30 percent of the plan assets. As of December 31, 2004, the actual allocation was 52 percent equity securities, 21 percent debt securities and 27 percent insurance contracts.

Measurement date

        Pliant Corporation uses a measurement date of December 31 for its pension plans. The following tables set forth the funded status of the United States Plans and the Germany Plan as of December 31, 2004, 2003, and 2002 and the amounts recognized in the consolidated balance sheets at those dates (in thousands):

		2004			2003			2002
United States Plans
Change in benefit obligation:
	Obligation at January 1	$	87,369		$	73,003		$	60,706
	Service cost		2,583			4,474			3,845
	Interest cost		4,970			5,157			4,582
	Plan amendments		—			122			593
	Curtailments		(14,875	)		—			—
	Actuarial (gain) loss		3,247			7,112			5,388
	Other		—			—			152
	Benefits paid		(2,730	)		(2,499	)		(2,263	)
	Obligation at December 31	$	80,564		$	87,369		$	73,003
Change in plan assets:
	Fair value of assets at January 1	$	48,838		$	37,071		$	41,872
	Actual return on plan assets		5,004			7,146			(3,260	)
	Employer contributions		7,261			7,120			569
	Other		—			—			153
	Benefit payments		(2,730	)		(2,499	)		(2,263	)
Fair value of plan assets at December 31		$	58,373		$	48,838		$	37,071
Underfunded status at December 31		$	22,191		$	38,531		$	35,932
Unrecognized net actuarial gain (loss)			(6,506	)		(15,762	)		(12,661	)
Unrecognized prior service cost			(789	)		(2,415	)		(2,469	)
Accrued long-term pension liability included in other liabilities		$	14,896		$	20,354		$	20,802

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        Amounts recognized in the balance sheet consist of (in thousands):

	2004			2003
Accrued benefit cost	$	14,896		$	20,354
Additional minimum liability in other liabilities		6,388			2,194
Intangible asset		(789	)		(773	)
Accumulated other comprehensive income		(5,599	)		(1,421	)
Accumulated pension liability	$	14,896		$	20,354

        The projected benefit obligation, accumulated benefit obligation, and fair value of assets for the plans were as follows (in thousands):

	2004			2003
Projected benefit obligation	$	80,564		$	87,369
Accumulated benefit obligation		79,657			70,882
Fair value of Assets		58,373			48,838
Weighted-Average Assumptions as of December 31
Discount rate		6.00	%		6.25	%
Rate of Compensation increase		4.00	%		4.00	%

		2004			2003
Germany Plan
Change in benefit obligation:
	Obligation at January 1	$	1,967		$	1,492
	Service cost		112			98
	Interest cost		115			93
	Benefits paid		(34	)		(25	)
	Change due to exchange rate		155			309
	Obligation at December 31	$	2,315		$	1,967
Fair value of plan assets at December 31			None			None
Underfunded status at December 31		$	2,315		$	1,967
Unrecognized net actuarial gain			139			122
Accrued long-term pension liability included in other liabilities		$	2,454		$	2,089

        Assumptions used for future compensation was 1.75% for 2004 and 2003. Discount rates were 5.25% for 2004 and 5.75% for 2003. The cash surrender value of life insurance policies for Germany Plan participants included in other assets in the consolidated balance sheets is approximately $1.3 million and $0.5 million as of December 31, 2004 and 2003.

        Effective January 1, 2003 we revised the United States Plans to exclude the participation of new non-union employees in such plans.

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        Foreign Plans Other Than Germany    Employees in other foreign countries are covered by various post employment arrangements consistent with local practices and regulations. Such obligations are not significant and are included in the consolidated financial statements in other liabilities.

        Other Plans    As part of the acquisition of Blessings Corporation in 1998, we assumed two supplemental retirement plans covering certain former employees of Blessings Corporation. The liability for these plans included in other liabilities and at December 31, 2004 was approximately $1.9 million. The liability for these plans was included in other liabilities at December 31, 2003 was approximately $1.8 million. This liability was frozen at the time of the acquisition.

11.  Redeemable Stock

        Common Stock    On May 31, 2000, we consummated a recapitalization pursuant to an agreement dated March 31, 2000 ("Recapitalization") among us, our then existing stockholders and an affiliate of J. P. Morgan Partners, LLC, whereby J. P. Morgan Partners, LLC acquired majority control of our common stock. Prior to the Recapitalization, we sold 50,611 shares of Class C nonvoting common stock to employees. As consideration, we received cash of approximately $2.5 million and secured promissory notes for approximately $2.6 million. We redeemed 1,100 of these shares prior to the Recapitalization. An additional 17,967 shares were redeemed in connection with the Recapitalization, and the remaining 31,544 shares were exchanged for the same number of common shares.

        As part of the Recapitalization, we entered into employment agreements with our executive officers serving at that time: Richard P. Durham, Jack E. Knott II, Scott K. Sorensen and Ronald G. Moffitt. The employment agreements established repurchase rights and put options for shares held by these executive officers following the Recapitalization. These repurchase rights allow us to repurchase these shares from the employee in the event of termination for any reason. The put options allow the employees to require us to purchase all of the shares held by the employee in the event of resignation for good reason, death, disability or retirement, subject to the restrictive provisions of our credit facilities or any other agreements. The purchase price under the repurchase rights and the put options is the fair market value of the common stock, as determined in good faith by our board of directors.

        The $2.6 million of notes receivable we originally received as partial consideration for the shares sold prior to the Recapitalization related to shares purchased by Mr. Durham, Mr. Sorensen and Mr. Moffitt. These secured promissory notes bore interest at 7% per annum. These notes were amended in connection with the Recapitalization and were further amended in connection with certain severance arrangements and other events relating to the transition to a new management team. Pursuant to these amendments, interest ceased to accrue on Mr. Sorensen's note as of December 31, 2000, and interest ceased to accrue on Mr. Durham's note and Mr. Moffitt's note as of February 28, 2001. Interest accrued prior to these dates is payable in three annual installments beginning on May 31, 2006 and the principal is due May 31, 2008.

        In connection with the Recapitalization in May 2000, we sold an aggregate of 32,750 shares of additional restricted common stock to Messrs. Durham, Knott, Sorensen and Moffitt for $483.13 per share, the estimated fair market value. We received, as consideration, notes receivable totaling $15.8 million. Under the May 2000 restricted stock purchase agreements related to the restricted common stock, we have repurchase rights, which allow us to repurchase unvested shares from these individuals, if the individuals cease to be employees for any reason. The repurchase rights lapsed with

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respect to one-sixth of these shares on January 1, 2001. The repurchase rights lapsed with respect to an additional one-sixth of these shares in January 2002 based on the financial results for the year ended December 31, 2001. Vesting for the remainder of the shares is reviewed at the end of each calendar quarter as follows: (a) vesting in full if 100% or more of the applicable target market value of equity is achieved as of the end of the applicable calendar quarter and (b) partial vesting if more than 90% of the applicable target market of equity is achieved as of the end of the applicable calendar quarter. If the applicable targets are below 90% each year, vesting will automatically occur in full on December 31, 2009. The repurchase rights also 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. The foregoing repurchase rights with respect to the restricted stock apply only to unvested restricted shares. As discussed above, however, our employment agreements with Messrs. Durham, Knott, Sorensen and Moffitt established additional repurchase rights and put options applicable to all other shares held by these individuals.

        The $15.8 million of secured promissory notes received as consideration for the 32,750 shares of restricted common stock bore interest at 7% per annum. These notes were also modified in connection with the severance arrangements and other events relating to the transition to a new management team. These modifications are described below.

        On December 27, 2000, we entered into a severance agreement with Mr. Sorensen. 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, we agreed on January 2, 2001, to repurchase 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 Mr. Sorensen, 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 or the balance on the note receivable. Interest ceased to accrue on the remaining $787,000 balance of the note related to Mr. Sorensen's purchase of stock in 1999. Further, the put option was cancelled.

        On January 22, 2001, we entered into a severance agreement with Mr. Moffitt. 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 per share and offset the purchase price against $1.5 million of note principal. We further agreed to cease charging interest on the remaining $302,000 principal balance of the note receivable related to 625 shares and to cease charging interest on the $262,000 principal balance related to Mr. Moffitt's purchase of stock in 1999. In addition, the Company's repurchase rights and Mr. Moffitt's put option were changed on the remaining 3,457 shares of common stock held by him. We agreed not to repurchase and Mr. Moffitt 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.

        On February 1, 2001, we amended Mr. Durham's promissory notes that were issued in connection with his purchases of stock in 1999 and 2000. Under the amended notes receivable, interest ceased 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 related pledge agreement.

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        On April 21, 2001, we amended the terms of Mr. Knott's promissory note issued in connection with his purchase of stock in 2000. Further, Mr. Knott's note was modified to remove the full recourse provisions and modify the related pledge agreement. As a result of these modifications and the modifications to the other officer's notes in the first quarter of 2001, Mr. Knott's purchase of stock for a promissory note in 2000 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.

        On June 10, 2002, we entered into a separation agreement with Mr. Durham. As of the date of the separation agreement, Mr. Durham owned 28,289 shares of common stock, 12,083 performance-vested shares, 2,417 time-vested shares, warrants to purchase 1,250.48 shares of common stock and 1,232 shares of preferred stock of Pliant. All of Mr. Durham's time-vested shares and 2,416 of Mr. Durham's performance-vested shares had vested as of the date of the separation agreement. Pursuant to the separation agreement, Mr. Durham agreed to convert one of his outstanding promissory notes issued as payment for a portion of his shares into two promissory notes. The first note (the "Vested Secured Note"), in the principal amount of $2,430,798, relates to Mr. Durham's time-vested shares and the vested portion of his performance-vested shares. The second note (the "Non-Vested Secured Note"), in the principal amount of $4,862,099, related to the 9,667 performance-vested shares which had not vested as of the date of the separation agreement. In addition to these notes, Mr. Durham had an additional outstanding promissory note (the "Additional Note"), with a principal amount of $1,637,974, relating to a portion of the shares of common stock held by Mr. Durham. In accordance with the separation agreement, we repurchased and cancelled Mr. Durham's 9,667 unvested shares in exchange for cancellation of the Non-Vested Secured Note on October 3, 2002.

        The separation agreement preserved the put option established by Mr. Durham's employment agreement with respect to his shares. For purposes of this put option, the separation agreement provides that the price per share to be paid by us is $483.13 with respect to common stock, $483.13 less any exercise price with respect to warrants, and the liquidation preference with respect to preferred stock. On July 9, 2002, Mr. Durham exercised his put option with respect to 28,289 shares of common stock, 1,232 shares of preferred stock and warrants to purchase 1,250.48 shares of common stock. Mr. Durham's put option is subject to any financing or other restrictive covenants to which we are subject at the time of the proposed repurchase. Restrictive covenants under our credit facilities limit the number of shares we can currently repurchase from Mr. Durham. On October 3, 2002, as permitted by the covenants contained in our credit facilities, we purchased 8,204 shares from Mr. Durham for a purchase price of $3,963,599 less the outstanding amount of the Additional Note, which was cancelled. In December 2002 we purchased an additional 1,885 shares of common stock from Mr. Durham for an aggregate purchase price of approximately $910,700. As of December 31, 2004, our total remaining purchase obligation to Mr. Durham was approximately $10,623,097, excluding accrued preferred dividends. We were limited to a maximum purchase from Mr. Durham of $5,000,000 of shares in 2003, which purchase may only be made if we meet certain leverage ratios.

        As of December 31, 2004 and 2003, there were a total of 29,073 outstanding common shares subject to put options as described above, of which 12,765 shares were acquired by the employees for cash from 1997 through 1999. As a result of the put options, the carrying value of all shares subject to put options will be adjusted to fair value at each reporting period with a corresponding offset to shareholders' equity for amounts related to the 12,765 shares and compensation expense for amounts related to the remaining shares until the notes receivable are paid in full.

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        Preferred Stock    We are authorized to issue up to 200,000 shares of preferred stock. As of December 31, 2003, 140,973 shares were issued and designated as Series A Cumulative Exchangeable Redeemable Preferred Stock (the "Series A Preferred Stock"). In connection with the Recapitalization, we sold 100,000 shares of the Series A Preferred Stock and detachable warrants to purchase 43,242 shares of common stock for net consideration of $98.5 million, net of issuance costs of $1.5 million. We allocated approximately $80.0 million to the Series A Preferred Stock and $18.5 million to the warrants based on the relative fair values of the instruments. In connection with the Uniplast acquisition we issued 30,983 shares of the Series A Preferred Stock (including 1,983 shares to employees) and detachable warrants to purchase shares of common stock for a consideration of $31.0 million, net of issue costs. We allocated $18.6 million to the Series A Preferred Stock, and $12.4 million to the warrants based on the relative fair values of the instruments. The common stock warrants have an exercise price of $0.01 per share and expire on May 31, 2011. In March 2003 we issued 10,000 shares of the Series A Preferred Stock and detachable warrants to purchase 43,962 shares of common stock. We allocated $9.5 million to the Series A Preferred Stock and $0.5 million to the warrants based on the relative fair values of the instrument. Direct issuance costs of $0.5 million were netted against the proceeds received.

        Dividends on the Series A Preferred Stock accrue at an annual rate of 14%. We have the option to pay dividends in cash or to have the dividends accrue and compound quarterly. After May 31, 2005, however, the annual dividend rate increases to 16% unless we pay dividends in cash. The annual dividend rate also increases to 16% if we fail to comply with certain of our obligations or upon certain events of bankruptcy. The shares of Series A Preferred Stock are non-voting.

        The Series A Preferred Stock is our most senior class of capital stock. We may, at our option, exchange the Series A Preferred Stock for 14% senior subordinated exchange notes so long as such exchange and the associated debt incurrence is permitted by our existing debt instruments. We must redeem the Series A Preferred Stock at a price equal to its liquidation preference of $1,000 per share, plus accumulated dividends, on May 31, 2011. On or after May 31, 2003, we may redeem the Series A Preferred Stock at our option, in whole or in part, at a redemption price equal to the sum of the liquidation preference plus accrued and unpaid dividends multiplied by the following percentages: 107% if redeemed prior to May 31, 2004; 103% if redeemed on or after May 31, 2004 and prior to May 31, 2005; and 100% if redeemed at any time on or after May 31, 2005.

        As a result of the mandatory redemption features, as of December 31, 2004, the carrying value of the Series A Preferred Stock is net of $27.1 million unamortized discount due to detachable warrants to purchase common stock. This unamortized discount is being accreted towards the $141.0 million redemption value at May 31, 2011. In addition, the Series A Preferred Stock balance as of December 31, 2004 includes $109.6 million for accrued dividends.

        On September 24, 2004, we adopted a 2004 Restricted Stock Incentive Plan, pursuant to which we sold to our President and Chief Executive Officer and selected additional officers of the Company, 704 shares of a total of 720 shares of a newly-created, non-voting Series B Redeemable Preferred Stock (the "Series B Preferred Stock") for a cash purchase price of $162 per share. These shares of Series B Preferred Stock were issued in private transactions with officers of the Company and therefore were exempt from the registration requirements of the Securities Act of 1933. On December 22, 2004, the remaining 16 authorized shares of Series B Preferred Stock were issued to an officer for a cash purchase price of $162 per share.

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        Upon the sale of all or substantially all of the Company's assets, sale of the majority of the outstanding Common Stock of the Company to a person other than J.P. Morgan or its affiliates; merger or consolidation of the Company, or the consummation of a liquidation, as those events are specifically described in the Company's Articles of Incorporation, we are required to redeem all shares of Series B Redeemable Preferred Stock by payment of cash in an amount equal to the product of (x) .000104166; times (y) the sum of the amount of cash distributions actually paid and the fair market value of assets distributed by the Company to its stockholders during the period commencing on September 24, 2004 through the date of such event, plus the net proceeds payable, whether in cash, stock or other assets, to the stockholders of the Company in respect of such event.

        Upon a redemption by the Company of any shares of Series A Preferred Stock (or any payment on any notes issued in exchange therefor), the holder of each share of Series B Redeemable Preferred Stock shall be entitled to receive a cash dividend equal to the product of (x) .000104166; times (y) the net proceeds payable, whether in cash, stock or other assets, to the stockholders of the Company in respect to such redemption or such payment.

        Upon an underwritten public offering of shares of capital stock of the Company to the public resulting in aggregate net proceeds to the Company of not less than $100 million each share of Series B Redeemable Preferred Stock shall be automatically converted into that number of shares of the class of common equity securities of the Company that are outstanding immediately following such public offering equal to the product of (x) .000104166; times (y) the total number of shares of such class of stock outstanding immediately following the consummation of the public offering. The shares of Series B Redeemable Preferred Stock are non-voting and do not bear dividends except as noted above.

        On September 8, 2003, we entered into a separation agreement with Jack E. Knott. As of the date of the separation agreement, Mr. Knott owned 232 shares of our common stock, 6,458 performance-vesting shares (of which 1,291 had vested), 1,292 time-vested shares, options to purchase 8,902 shares of our common stock and 229 shares of our preferred stock. We cancelled 5,167 unvested performance vesting shares owned by Mr. Knott against a note receivable from Mr. Knott for $2.5 million. Pursuant to the terms of the severance agreement, and in addition to the benefits payable to Mr. Knott following a termination without cause under the terms of his employment agreement with us, we agreed: to extend the termination date of his right to exercise his vested options to acquire 8,902 shares of common stock until August 22, 2005; not to exercise our rights to redeem the common stock, vested performance-vesting shares, time-vested shares and preferred stock owned by him until the earlier of a transaction consisting of a sale of us or August 22, 2005; and to pay him a cash payment of $50,000.

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12.  Stock Option Plans

        Pursuant to the Recapitalization, we adopted a 2000 stock incentive plan, which, as amended, allows us to grant to employees nonqualified options to purchase up to 65,600 shares of common stock. The option price must be no less than fair market value on the date of grant. Unvested options are forfeited upon the employee's termination of employment. Vested options are forfeited, if not exercised 90 days after the employee's termination of employment. The plan is administered by the board of directors who determines the quantity, terms and conditions of an award, including any vesting conditions. The plan expires on either May 31, 2010 or a date which the board of directors, in its sole discretion, determines that the plan will terminate.

        In August 2002, we adopted our 2002 Stock Incentive Plan. The 2002 plan authorizes grants of incentive stock options, nonqualified stock options and stock bonuses, as well as the sale of shares of common stock, to our employees, officers, directors and consultants of Pliant or any of its subsidiaries. A total of 4,793 shares are authorized for issuance under the 2002 plan. As of December 31, 2004, no options or shares had been granted or sold under the 2002 plan.

        A summary of stock option activity under the 2000 plan is as follows:

		Option Share		Weighted Average Exercise Price
Outstanding at December 31, 2001		34,837		$	385.22
	Granted	20,425			483.13
	Exercised	—			—
	Forfeited or cancelled	(3,920	)		483.13
Outstanding at December 31, 2002		51,342			416.70
	Granted	250			483.13
	Exercised	—			—
	Forfeited or cancelled	(6,580	)		483.13
Outstanding at December 31, 2003		45,012			407.25
	Granted	3,850			483.13
	Exercised	—			—
	Forfeited or cancelled	(17,394	)		483.13
Outstanding at December 31, 2004		31,468			396.74
Exercisable at December 31, 2004		13,277			226.25

        The weighted average remaining contractual life of the options is approximately five years at December 31, 2004. The options granted prior to January 1, 2001 pursuant to the 2000 plan, as amended, provide for vesting as follows: (1) one-sixth are "time-vested" options or shares, which vested on January 1, 2001, so long as the recipient was still our employee on such date, and (2) the remainder are "performance-vested" options or shares, which vest in increments upon the achievement of performance targets as follows: (a) vesting in full, if 100% or more of the applicable performance target is achieved as of the end of any calendar quarter during the option term and (b) partial vesting if more than 90% of the applicable performance target is achieved as of the end of any calendar quarter during the option term. Moreover, all performance-vested options or shares not previously vested in accordance with the preceding sentence will vest automatically in full on December 31, 2009 so long as the recipient is still our employee on such date. Options granted pursuant to the 2000 plan subsequent to January 1, 2001 vest similarly, except that all of the options are "performance-vested"

F-58

options, which vest in increments upon the achievement of performance targets. As of December 31, 2004, 8,902 options are exercisable at $100 per share and 4,375 are exercisable at $483.13 per share.

13.  Commitments and Contingencies

        Environmental Contingencies    Our operations are subject to extensive environmental laws and regulations concerning emissions to the air, discharges to surface and subsurface waters, and the generation, handling, storage, transportation, treatment, and disposal of waste materials, as adopted by various governmental authorities in the jurisdictions in which we operate. We make every reasonable effort to remain in full compliance with existing governmental laws and regulations concerning the environment.

        Royalty Agreements    We have entered into royalty agreements (the "Agreements") for the right to use certain patents in the production of our Winwrap stretch film. The Agreements require us to pay the patent holder a fee of $.05 for each pound of Winwrap produced and $.10 per pound for each pound of coreless Winwrap produced. The Agreements terminate upon the expiration of the related patents in 2009. During the years ended December 31, 2004, 2003 and 2002, we paid and expensed royalties of $1.6 million, $2.0 million, and $1.5 million, respectively, under the Agreements.

        Litigation    On June 14, 2004, we settled the complaint filed against us by S.C. Johnson & Sons, Inc. and S.C. Johnson Home Storage filed in the U.S. District Court for the District of Michigan, Northern Division (Case No. 01-CV-10343-BC) for $6.0 million plus legal fees which was within management's estimated costs of $7.2 million accrued in the fourth quarter 2003.

        On February 26, 2003, former employees of our Fort Edward, NY manufacturing facility, which we acquired as part of the Decora acquisition, named us as defendants in a complaint filed in the Supreme court of the State of New York, County of Washington (Index No. 4417E). We received service of this complaint on April 2, 2003, and successfully removed the case to the United States District Court for the Northern District of New York (Case No. 1:03cv00533). The complaint alleges claims against us for conspiracy to defraud and breach of contract arising out of our court-approved purchase of the assets of Decora Industries, Inc. and Decora, Incorporated. Plaintiffs' complaint seeks compensatory and punitive damages and a declaratory judgment nullifying severance agreements for lack of consideration and economic duress. On December 15, 2004, the case was dismissed in response to our motions to dismiss. On January 13, 2005, the Plaintiff appealed the dismissal of the case to the United States Court of Appeals for the Second District. We intend to resist the plaintiffs' claims vigorously. We do not believe this proceeding will have a material adverse affect on our financial condition or results of operations.

        We are involved in ongoing litigation matters from time to time in the ordinary course of our business. In our opinion, none of such litigation is material to our financial condition or results of operations.

14.  Operating Segments

        Operating segments are components of our business 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 basis that it is used internally for evaluating segment performance.

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        During the fourth quarter of 2004, we reorganized our operations under four operating segments; our Specialty Products Group, which manufactures personal care, medical and agricultural films in it's Specialty Films division and printed rollstock, bags and sheets used to package food and consumer goods in the Printed Products division; our Industrial Films segment which manufactures stretch film used to bundle, unitize and protect palletized loads during shipping and storage and PVC films used by supermarkets, delicatessens and restaurants to wrap meat, cheese and produce; our Engineered Films segment which manufactures film for sale to converters of flexible packaging; and our Performance Films segment which manufactures a variety of barrier and custom film for smaller niche flexible packaging and industrial markets. Segment information in this report with respect to 2003 and 2002 has been restated to reflect this reorganization.

        The accounting policies of the operating segments are the same as those described in the summary of significant accounting policies. Sales and transfers between our segments are eliminated in consolidation. We evaluate the performance of our operating segments based on net sales (excluding intercompany sales) and segment profit. The segment profit reflects income from continuing operations adjusted for interest expense, income taxes, depreciation, amortization, restructuring and other costs and other non-cash charges (principally the impairment of goodwill, intangible assets and fixed assets). Our reportable segments are managed separately with separate management teams, because each segment has differing products, customer requirements, technology and marketing strategies.

F-60

        Segment profit and segment assets as of and for the years ended December 31, 2004, 2003 and 2002 are presented in the following table (in thousands). Certain reclassifications have been made to the prior year amounts to be consistent with the 2004 presentation.

			Specialty Products Group		Industrial Films			Engineered Films		Performance Films		Corporate / Other			Total
2004
	Net sales to customers		$	390,733	$	254,104		$	218,963	$	98,148	$	6,732		$	968,680
	Intersegment sales			14,030		7,170			6,146		1,936		(29,282	)		—
		Total net sales		404,763		261,274			225,109		100,084		(22,550	)		968,680
	Depreciation and amortization			18,932		5,589			7,090		3,447		6,352			41,410
	Interest expense			4,467		29			646		13		140,523			145,678
	Segment profit (loss)			46,972		26,245			32,228		19,828		(30,645	)		94,628
	Segment total assets			375,033		105,543			140,799		68,190		87,527			777,092
	Capital expenditures			10,452		8,113			2,011		1,140		2,374			24,090
2003
	Net sales to customers		$	367,707	$	219,617		$	196,066	$	105,233	$	5,856		$	894,479
	Intersegment sales			16,974		1,792			5,043		475		(24,284	)		—
		Total net sales		384,681		221,409			201,109		105,708		(18,428	)		894,479
	Depreciation and amortization			21,970		7,316			6,486		3,486		12,482			51,740
	Interest expense			1,974		6			603		18		93,803			96,404
	Segment profit (loss)			48,981		27,182			34,054		24,049		(43,030	)		91,236
	Segment total assets			376,686		94,633			140,206		68,314		106,947			786,786
	Capital expenditures			6,254		4,213			1,746		3,821		1,005			17,039
2002
	Net sales to customers		$	346,635	$	191,378		$	205,352	$	98,625	$	8,917		$	850,907
	Intersegment sales			11,781		7,136			4,898		1,719		(25,534	)		—
		Total net sales		358,416		198,514			210,250		100,344		(16,617	)		850,907
	Depreciation and amortization			19,620		5,326			6,105		3,461		11,206			45,718
	Interest expense			1,669		(100	)		534		19		73,142			75,264
	Segment profit (loss)			55,220		30,526			38,159		23,171		(28,227	)		118,849
	Segment total assets			408,652		95,130			148,134		72,481		128,806			853,203
	Capital expenditures			22,379		9,912			8,305		2,423		6,132			49,151

F-61

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

			2004			2003			2002
Profit or Loss
	Total segment profit		$	94,628		$	91,236		$	118,849
	Depreciation, amortization and impairments			(41,410	)		(51,739	)		(45,718	)
Impairment of Goodwill and Intangible assets				—			(18,255	)		(8,600	)
Restructuring and other costs				(2,108	)		(12,607	)		(30,066	)
	Interest expense			(145,678	)		(96,404	)		(75,264	)
	Other expenses and adjustments for non-cash charges and certain adjustments defined by our credit agreement			—			—			(1,167	)
		Loss from continuing operations before income taxes	$	(94,568	)	$	(87,769	)	$	(41,966	)
Assets
	Total assets for reportable segments		$	689,565		$	679,839		$	724,397
	Assets of discontinued operations			—			20,708			27,625
	Other unallocated assets			87,527			86,239			101,181
		Total consolidated assets	$	777,092		$	786,786		$	853,203

        There were no sales to a single customer in 2004, 2003 or 2002 that was more than 10% of consolidated net sales.

        Net sales and long-lived assets of our US and foreign operations are as follows:

			2004		2003		2002
Net Sales
	United States		$	779,966	$	724,048	$	695,435
	Foreign countries(1)			188,714		170,431		155,473
		Total	$	968,680	$	894,479	$	850,908
Long-lived assets
	United States			434,645		452,407
	Foreign countries			61,813		64,427
		Total	$	496,458	$	516,834
Total Assets
	United States			655,885		671,776
	Foreign countries			121,207		115,010
		Total	$	777,092	$	786,786

(1)

Foreign countries include Australia, Canada, Germany and Mexico, none of which individually represents 10% of consolidated net sales or long-lived assets.

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15.  Warrants Outstanding

        The following warrants were issued and outstanding as of December 31:

		2004	2003
Issued with the senior subordinated notes		18,532	18,532
Issued in connection with recapitalization transaction		43,242	43,242
Issued in connection with Uniplast acquisition		31,003	31,003
Issued in connection with the March 2003 Preferred Stock issuance		43,962	43,962
	Total outstanding	136,739	136,739

        As of December 31, 2004, 136,739 warrants were exercisable at an exercise price of $0.01 per share. The Company has reserved up to 136,739 shares of common stock for issuance upon the exercise of issued and outstanding warrants.

16.  Estimated Fair Value of Financial Instruments

        The estimated fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. In the case of cash and cash equivalents, accounts receivable and accounts payable, the carrying amount is considered a reasonable estimate of fair value. The fair value of fixed debt in 2004 and 2003 was obtained from market quotes. Fair value estimates are made at a specific point in time. Because no market exists for a significant portion of our financial instruments, fair value estimates are based on judgments regarding current economic conditions, risk characteristics of various financial instruments, interest rate levels, and other factors. These estimates are subjective in nature and involve uncertainties and matters of judgment and therefore cannot be determined or relied on with any degree of certainty. Changes in assumptions could significantly affect the estimates. See Note 6 for interest rate derivative information.

        Below is a summary of our financial instruments' carrying amounts and estimated fair values as of December 31, (in thousands):

			2004				2003
			Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Financial assets:
	Cash and cash equivalents		$	5,580	$	5,580	$	3,308	$	3,308
	Accounts receivable			117,087		117,087		95,606		95,606
		Total financial assets	$	122,667	$	122,667	$	98,914	$	98,914
Financial liabilities:
	Floating rate debt		$	24,000	$	24,000	$	219,575	$	219,575
	Fixed rate debt			818,348		865,583		564,082		562,800
	Accounts payable			96,282		96,282		89,800		89,800
		Total financial liabilities	$	938,630	$	985,865	$	873,457	$	872,175

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17.  Related-Party Transactions

        J.P. Morgan Partner and Affiliates    JPMorgan Chase Bank is the syndication agent, and its affiliate, J.P. Morgan Chase & Co., is a lender under our credit facilities. Both JPMorgan Chase Bank and J.P. Morgan Chase & Co. receive customary fees under the credit facilities for acting in such capacities including approximately $1.2 million in 2002 and $0.9 million in 2003 and $3.4 million in 2004. JPMorgan Chase Bank was also a lender under our prior credit facility, and as a result, received a portion of the proceeds from the financing for the Recapitalization and related transactions. Chase Securities Inc. was one of the initial purchasers in the offering of the $220.0 million aggregate principal amount of 13% senior subordinated notes due 2010, and was also the dealer manager for the debt tender offer and consent solicitation relating to our 9¹/8% senior subordinated notes due 2007 and received customary fees for acting in such capacities. Each of JPMorgan Chase Bank, J.P. Morgan Chase & Co. and Chase Securities Inc. are affiliates of Southwest Industrial Films, LLC, which owns approximately 55% of our outstanding common stock and currently has the right under the stockholders' agreement to appoint four of our directors, and of Flexible Films, LLC, which, together with affiliates, owns approximately 59% of our Preferred Stock, subject to certain preemptive rights with respect to 10,000 shares of Preferred Stock issued on March 25, 2003.

18.  Accumulated Other Comprehensive Income/(Loss)

        The components of accumulated other comprehensive income/(loss) as of December 31, were as follows (in thousands):

	2004			2003
Minimum pension liability, net of taxes of $575 and $575	$	(5,352	)	$	(1,464	)
Fair value change in interest rate derivatives classified as cash flow hedges, net of taxes of $0 and $1,420		—			(2,220	)
Foreign currency translation adjustments		(6,491	)		(8,237	)
Accumulated other comprehensive income/(loss)	$	(11,843	)	$	(11,921	)

        Due to the February 2004 termination of the credit facilities that existed at December 31, 2003, the balance in the other comprehensive income related to interest rate derivatives of $2.2 million ($3.6 million pre-tax) was charged to interest expense in the first quarter of 2004.

19.  Condensed Consolidating Financial Statements

        The following condensed consolidating financial statements present, in separate columns, financial information for (i) Pliant Corporation (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 "2000 Indenture") relating to Pliant Corporation's $220 million senior subordinated notes due 2010 (the "2000 Notes") and the Indenture, dated April 10, 2002 (the "2002 Indenture" and, together with the 2000 Indenture, the "Indentures"), relating to Pliant's $100 million senior subordinated notes due 2010 (the "2002 Notes" and, together with the 2000 Notes, the "Notes") on a combined basis, with any investments in non-guarantor subsidiaries specified in the Indentures 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 Corporation and its subsidiaries on a consolidated basis, and (v) Pliant Corporation on a consolidated basis, in each case as of December 31, 2004 and 2003 and for the years ended December 31, 2004, 2003 and 2002. The Notes are fully and unconditionally guaranteed on a joint and several basis by each guarantor subsidiary and each guarantor subsidiary is 100% owned, directly or indirectly, by Pliant Corporation within the meaning of Rule 3-10(h)(1) of Regulation S-X. There are no contractual restrictions limiting transfers of cash from guarantor and non-guarantor subsidiaries to Pliant Corporation except from our Alliant joint venture. 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.

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Condensed Consolidating Balance Sheet
As of December 31, 2004 (In Thousands)

			Pliant Corporation Parent Only			Combined Guarantors			Combined Non-Guarantors			Eliminations			Consolidated Pliant Corporation
ASSETS
Current assets:
	Cash and cash equivalents		$	—		$	704		$	4,876		$	—		$	5,580
	Receivables			95,439			7,861			22,095			—			125,395
	Inventories			74,672			7,411			12,217			—			94,300
	Prepaid expenses and other			2,764			370			898			—			4,032
	Income taxes receivable			138			223			—			—			361
	Deferred income taxes			12,741			—			(780	)		—			11,961
		Total current assets		185,754			16,569			39,306			—			241,629
Plant and equipment, net				240,599			17,127			39,419			—			297,145
Goodwill				167,583			13,331			1,323			—			182,237
Intangible assets, net				5,328			11,692			56			—			17,076
Investment in subsidiaries				(28,793	)		—			—			28,793			—
Other assets				35,588			—			3,417			—			39,005
	Total assets		$	606,059		$	58,719		$	83,521		$	28,793		$	777,092
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
	Trade accounts payable		$	76,515		$	5,848		$	13,919		$	—		$	96,282
	Accrued liabilities			56,639			3,554			4,645			—			64,838
	Current portion of long-term debt			1,994			—			—			—			1,994
	Due to (from) affiliates			(133,109	)		75,190			57,919			—			—
		Total current liabilities		2,039			84,592			76,483			—			163,114
Long-term debt, net of current portion				840,354			—			—			—			840,354
Other liabilities				23,608			—			2,846			—			26,454
Deferred income taxes				24,354			3,938			3,141			—			31,433
Shares subject to mandatory redemption				229,910			—			—			—			229,910
		Total liabilities		1,120,265			88,530			82,470			—			1,291,265
Minority interest				—			—			33			—			33
Redeemable stock:
	Preferred stock			117			—			—			—			117
	Common stock			6,645			—			—			—			6,645
		Total redeemable stock		6,762			—			—			—			6,762
Stockholders' (deficit):
	Common stock			103,376			14,020			29,302			(43,322	)		103,376
	Warrants to purchase common stock			39,133			—			—			—			39,133
	Retained earnings (deficit)			(650,974	)		(45,237	)		(22,767	)		68,004			(650,974	)
	Stockholders' notes receivable			(660	)		—			—			—			(660	)
	Accumulated other comprehensive loss			(11,843	)		1,406			(5,517	)		4,111			(11,843	)
Total stockholders' (deficit)				(520,968	)		(29,811	)		1,018			28,793			(520,968	)
	Total liabilities and stockholders' (deficit)		$	606,059		$	58,719		$	83,521		$	28,793		$	777,092

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Condensed Consolidating Statement of Operations
For the Year Ended December 31, 2004 (In Thousands)

		Pliant Corporation Parent Only			Combined Guarantors			Combined Non-Guarantors			Eliminations			Consolidated Pliant Corporation
Net sales		$	796,794		$	75,931		$	125,335		$	(29,380	)	$	968,680
Cost of sales			671,297			66,431			118,471			(29,380	)		826,819
	Gross profit		125,497			9,500			6,864			—			141,861
Total operating expenses			76,869			4,026			9,119			—			90,014
	Operating income (loss)		48,628			5,474			(2,255	)		—			51,847
Interest expense			(140,566	)		(646	)		(4,466	)		—			(145,678	)
Equity in earnings of subsidiaries			(30,004	)		—			—			30,004			—
Other income (expense), net			8,139			(3,278	)		(5,598	)		—			(737	)
	Income (loss) from continuing operations before income taxes		(113,803	)		1,550			(12,319	)		30,004			(94,568	)
Income tax (benefit) expense			119			867			603			—			1,589
Loss from continuing operations			(113,922	)		683			(12,922	)		30,004			(96,157	)
Loss from discontinued operations			—			(17,765	)		—			—			(17,765	)
Net income (loss)		$	(113,922	)	$	(17,082	)	$	(12,922	)	$	30,004		$	(113,922	)

F-66

Condensed Consolidating Statement of Cash Flows
For the Year Ended December 31, 2004 (In Thousands)

		Pliant Corporation Parent Only			Combined Guarantors			Combined Non-Guarantors			Eliminations		Consolidated Pliant Corporation
Cash flows from continuing operating activities:		$	(35,311	)	$	3,305		$	30,562		$	—	$	(1,444	)
Cash flows from continuing investing activities:
	Capital expenditures for plant and equipment		(17,086	)		(517	)		(6,487	)		—		(24,090	)
	Proceeds from sale of assets		6,450			—			—			—		6,450
	Net cash used in investing activities		(10,636	)		(517	)		(6,487	)		—		(17,640	)
Cash flows from continuing financing activities:
	Payment of capitalized fees		(9,864	)		—			—			—		(9,864	)
	Net proceeds from issuance of preferred stock		117			—			—			—		117
	Proceeds from issuance of senior discount notes		225,299			—			—			—		225,299
	Borrowings/(payments) on long-term debt		(165,922	)		—			(24,163	)		—		(190,085	)
	Net cash provided by (used) in continuing financing activities		49,630			—			(24,163	)		—		25,467
Cash used in discontinued operations			(3,952	)		(892	)		—			—		(4,844	)
Effect of exchange rate changes on cash and cash equivalents			269			(2,384	)		2,848			—		733
Net (decrease)/increase in cash and cash equivalents			—			(488	)		2,760			—		2,272
Cash and cash equivalents at beginning of the year			—			1,192			2,116			—		3,308
Cash and cash equivalents at end of the year		$	—		$	704		$	4,876		$	—	$	5,580

F-67

Condensed Consolidating Balance Sheet
As of December 31, 2003 (In Thousands)

			Pliant Corporation Parent Only			Combined Guarantors			Combined Non-Guarantors			Eliminations			Consolidated Pliant Corporation
ASSETS
Current assets:
	Cash and cash equivalents		$	—		$	552		$	2,756		$	—		$	3,308
	Receivables			79,685			6,259			21,798			—			107,742
	Inventories			63,954			6,155			14,016			—			84,125
	Prepaid expenses and other			2,626			406			777			—			3,809
	Income taxes receivable			167			525			744			—			1,436
	Deferred income taxes			10,934			—			(1,517	)		—			9,417
	Discontinued current assets			—			15,294			—			—			15,294
		Total current assets		157,366			29,191			38,574			—			225,131
Plant and equipment, net				253,601			11,999			49,820			—			315,420
Goodwill				182,162			—			—			—			182,162
Intangible assets, net				19,252			—			—			—			19,252
Investment in subsidiaries				(916	)		—			—			916			—
Other assets				36,125			—			4,047			—			40,172
Discontinued noncurrent assets				500			4,149			—			—			4,649
	Total assets		$	648,090		$	45,339		$	92,441		$	916		$	786,786
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
	Trade accounts payable		$	66,839		$	4,701		$	18,260		$	—		$	89,800
	Accrued liabilities			53,714			3,139			6,793			—			63,646
	Current portion of long-term debt			1,033			—			—			—			1,033
	Due to (from) affiliates			(72,692	)		42,738			29,954			—
		Total current liabilities		48,894			50,578			55,007			—			154,479
Long-term debt, net of current portion				758,461			—			24,163			—			782,624
Other liabilities				24,952			—			2,541			—			27,493
Deferred income taxes				21,676			2,502			3,614			—			27,792
		Total liabilities		853,983			53,080			85,325			—			992,388
Minority interest				—			—			291			—			291
Redeemable stock:
	Preferred stock			188,223			—			—			—			188,223
	Common stock			13,008			—			—			—			13,008
		Total redeemable stock		201,231			—			—			—			201,231
Stockholders' (deficit):
	Common stock			103,376			14,020			29,302			(43,322	)		103,376
	Warrants to purchase common stock			39,133			—			—			—			39,133
	Retained earnings (deficit)			(537,052	)		(21,750	)		(16,250	)		38,000			(537,052	)
	Stockholders' notes receivable			(660	)		—			—			—			(660	)
	Accumulated other comprehensive loss			(11,921	)		(11	)		(6,227	)		6,238			(11,921	)
Total stockholders' (deficit)				(407,124	)		(7,741	)		6,825			916			(407,124	)
	Total liabilities and stockholders' (deficit)		$	648,090		$	45,339		$	92,441		$	916		$	786,786

F-68

Condensed Consolidating Statement of Operations
For the Year Ended December 31, 2003 (In Thousands)

		Pliant Corporation Parent Only			Combined Guarantors			Combined Non-Guarantors			Eliminations			Consolidated Pliant Corporation
Net sales		$	729,528		$	75,767		$	113,839		$	(24,655	)	$	894,479
Cost of sales			609,085			67,677			106,038			(24,655	)		758,145
	Gross profit		120,443			8,090			7,801			—			136,334
Total operating expenses			94,853			10,907			22,411			—			128,171
	Operating income (loss)		25,590			(2,817	)		(14,610	)		—			8,163
Interest expense			(93,821	)		(603	)		(1,980	)		—			(96,404	)
Equity in earnings of subsidiaries			(55,057	)		—			—			55,057			—
Other income (expense), net			7,238			(5,214	)		(1,552	)		—			472
	Income (loss) before income taxes		(116,050	)		(8,634	)		(18,142	)		55,057			(87,769	)
Income tax (benefit) expense			(1,953	)		5,159			1,984			—			5,190
Loss from continuing operations			(114,097	)		(13,793	)		(20,126	)		55,057			(92,959	)
Loss from discontinued operations			156			(21,499	)		—			—			(21,343	)
Net income (loss)		$	(113,941	)	$	(35,292	)	$	(20,126	)	$	55,057		$	(114,302	)

F-69

Condensed Consolidating Statement of Cash Flows
For the Year Ended December 31, 2003 (In Thousands)

		Pliant Corporation Parent Only			Combined Guarantors			Combined Non-Guarantors			Eliminations		Consolidated Pliant Corporation
Cash flows from continuing operating activities:		$	(14,405	)	$	(9,262	)	$	9,447		$	—	$	(14,220	)
Cash flows from continuing investing activities:
	Capital expenditures for plant and equipment		(10,288	)		(1,335	)		(5,416	)		—		(17,039	)
	Net cash used in continuing investing activities		(10,288	)		(1,335	)		(5,416	)		—		(17,039	)
Cash flows from financing activities:
	Payment of capitalized fees		(10,801	)		—			—			—		(10,801	)
	Net proceeds from issuance of common and preferred stock		9,532			—			—			—		9,532
	Payment/receipt of dividend		2,499			—			(2,499	)		—		—
	Borrowings/(payments) on long-term debt		47,905			—			(629	)		—		47,276
	Net cash provided by (used) in continuing financing activities		49,135			—			(3,128	)		—		46,007
Cash provided by (used) in discontinued operations			(24,485	)		9,724			—			—		(14,761	)
Effect of exchange rate changes on cash and cash equivalents			747			1,382			(443	)		—		1,686
Net (decrease)/increase in cash and cash equivalents			704			509			460			—		1,673
Cash and cash equivalents at beginning of the year			(184	)		163			1,656			—		1,635
Cash and cash equivalents at end of the year		$	520		$	672		$	2,116		$	—	$	3,308

F-70

Condensed Consolidating Statement of Operations
For the Year Ended December 31, 2002 (In Thousands)

		Pliant Corporation Parent Only			Combined Guarantors			Combined Non-Guarantors			Eliminations			Consolidated Pliant Corporation
Net sales		$	695,002		$	75,153		$	107,373		$	(26,620	)	$	850,908
Cost of sales			567,702			63,173			89,421			(26,620	)		693,676
	Gross profit		127,300			11,980			17,952			—			157,232
Total operating expenses			103,830			1,722			20,660			—			126,212
	Operating income		23,470			10,258			(2,708	)		—			31,020
Interest expense			(73,035	)		(535	)		(1,694	)		—			(75,264	)
Equity in earnings of subsidiaries			(5,159	)		—			—			5,159			—
Other income (expense), net			8,277			(5,418	)		(581	)		—			2,278
Income (loss) from continuing operations before income taxes			(46,447	)		4,305			(4,983	)		5,159			(41,966	)
Income tax (benefit) expense			(5,054	)		770			2,822			—			(1,462	)
Income (loss) from continuing operations			(41,393	)		3,535			(7,805	)		5,159			(40,504	)
Loss from discontinued operations			(2,037	)		(889	)		—			—			(2,926	)
Net income (loss)		$	(43,430	)	$	2,646		$	(7,805	)	$	5,159		$	(43,430	)

F-71

Condensed Consolidating Statement of Cash Flows
For the Year Ended December 31, 2002 (In Thousands)

		Pliant Corporation Parent Only			Combined Guarantors			Combined Non-Guarantors			Eliminations		Consolidated Pliant Corporation
Cash flows from continuing operating activities:		$	25,813		$	3,761		$	22,845		$	—	$	52,419
Cash flows from continuing investing activities:
	Capital expenditures for plant and equipment		(35,181	)		(5,649	)		(8,321	)		—		(49,151	)
	Acquisition, net of cash acquired		(8,794	)		(14,370	)		—			—		(23,164	)
	Asset transfer		(9,116	)		9,762			(646	)		—		—
	Proceeds from sale of assets		15,033			3,589			(1,500	)		—		17,122
	Net cash used in continuing investing activities		(38,058	)		(6,668	)		(10,467	)		—		(55,193	)
Cash flows from financing activities:
	Payment of capitalized fees		(7,439	)		—			—			—		(7,439	)
	Net proceeds from issuance of common and preferred stock		(3,227	)		—			—			—		(3,227	)
	Borrowings/(payments) on long-term debt		31,266			—			(8,208	)		—		23,058
	Net cash provided by (used in) continuing financing activities		20,600			—			(8,208	)		—		12,392
Cash used in discontinued operations			(15,812	)		6,946			—			—		(8,866	)
Effect of exchange rate changes on cash and cash equivalents			7,273			(5,149	)		(6,059	)		—		(3,935	)
Net (decrease)/increase in cash and cash equivalents			(184	)		(1,110	)		(1,889	)		—		(3,183	)
Cash and cash equivalents at beginning of the year			—			1,934			2,884			—		4,818
Cash and cash equivalents at end of the year		$	(184	)	$	824		$	995		$	—	$	1,635

F-72

20.  OTHER INCOME/EXPENSE

        Other expense for the year ended December 31, 2004 includes $1.3 million loss on the sale of real property, $0.1 million currency gain, and $0.5 million other less significant items. Other income for the year ended December 31, 2003 includes $1.4 million loss on disposal of real property, $0.2 million currency gain, $0.1 million royalty income, $0.2 million rental income, and $1.4 million other less significant items. Other income for the year ended December 31, 2002 includes a cash settlement with a customer of $0.7 million and $1.6 of other less significant items.

21.  SELECTED QUARTERLY INFORMATION—UNAUDITED

        Selected quarterly financial information for the years ended December 31, 2004 and 2003 are as follows (in thousands):

	Quarter Ended
	December 31, 2004			September 30, 2004			June 30, 2004			March 31, 2004
Net sales previously reported	$	253,536		$	243,160		$	242,696		$	244,167
Net sales discontinued operations		—			—			(7,511	)		(7,368	)
Net sales restated		253,536			243,160			235,185			236,799
Gross profit previously reported		29,982			36,219			35,551			36,792
Gross profit discontinued operations		—			—			1,776			1,541
Gross profit restated		29,982			36,219			37,327			38,333
Net income/(loss)		(29,638	)		(32,156	)		(21,369	)		(30,759	)

	Quarter Ended
	December 31, 2003			September 30, 2003			June 30, 2003			March 31, 2003
Net sales previously reported	$	223,604		$	238,718		$	226,573		$	240,511
Net sales discontinued operations		(6,266	)		(11,129	)		(8,743	)		(8,789	)
Net sales restated		217,338			227,589			217,830			231,722
Gross profit previously reported		22,472			34,387			36,241			42,797
GE Lease Reclass from SG&A		(1,002	)		(1,002	)		(1,094	)		(936	)
Gross profit discontinued operations		2,828			3,534			(1,017	)		(874	)
Gross profit restated		24,298			36,919			34,130			40,987
Net income/(loss)		(67,957	)		(20,101	)		(18,901	)		(7,343	)

        Substantially all the assets of Pliant Solutions, previously reported as a separate operating segment, were sold in the third quarter of 2004 and its operating results reported as discontinued operations. The net loss for the quarter ended December 31, 2003 reflects the impairment of Goodwill and Intangible assets discussed in Note 5, the impairment of fixed assets discussed in Note 4, and the provision for litigation discussed in Note 12. The quarter ended December 31, 2004 includes $4.5 million expense for an error related to accrued vacation not previously recorded. The amount does not affect historical or future cash flows and its effect on operations and financial position is immaterial.

22.  SUBSEQUENT EVENT—ALLIANT JOINT VENTURE

        On January 5, 2005, we terminated our joint venture with Supreme Plastics Group PLC by purchasing all of the equity interests in the joint venture Supreme Plastics Group PLC owned for $400,000. As of January 5, 2005, Alliant Company LLC became a wholly-owned subsidiary of the Company. On January 5, 2005, Pliant Corporation signed a nonbinding letter of intent to sell the intellectual property, working capital, and equipment assets used in the Alliant operation to an independent third party for a purchase price of $6.3 million, subject to certain adjustments. Although a purchase agreement is being negotiated, there is no assurance if or when this sale will be completed. Any such sale will require the consent of or waivers by the Company's lenders, who may require that the proceeds of that sale be used to repay indebtedness.

F-73

PLIANT CORPORATION AND SUBSIDIARIES
SCHEDULE II
VALUATION AND QUALIFYING ACCOUNTS
For the Years Ended December 31, 2004, 2003 and 2002
(In Thousands)

Description	Balance at Beginning of Year		Additions Charged to Profit & Loss		Write-offs			Foreign Currency impact		Balance at End of Year
ALLOWANCE FOR DOUBTFUL ACCOUNTS:
2004	$	4,736	$	1,600	$	(1,878	)	$	31	$	4,489
2003	$	4,627	$	1,667	$	(1,700	)	$	142	$	4,736
2002	$	2,438	$	2,635	$	(549	)	$	103	$	4,627

	Balance at Beginning of Year	Additions Charged To Continuing Operations	Additions Charged To Discontinued Operations	Balance at End of Year
INCOME TAX VALUATION ALLOWANCE
2004	39,693	15,074	6,927	61,694
2003	10,775	20,594	8,324	39,693
2002	1,868	7,766	1,141	10,775

S-1

Pliant Corporation
$7,800,000 Principal Amount at Maturity of
11¹/8% Senior Secured Discount Notes due 2009
Which Are Guaranteed on a Senior Secured Basis by
our Existing and Future Restricted Domestic Subsidiaries
and Certain Foreign Subsidiaries

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

Item 20.    Indemnification of Directors and Officers.

        Article IV of Pliant Corporation's Third Amended and Restated Articles of Incorporation, as amended, provides that Pliant Corporation shall indemnify and advance expenses to its directors and officers and to any person who is or was serving at its request as a director or officer of another domestic or foreign corporation (and their respective estates or personal representatives) to the fullest extent as from time to time permitted by Utah law. In addition, pursuant to Article IV of the Third Amended and Restated Articles of Incorporation, as amended, the personal liability of the directors and officers of Pliant Corporation to Pliant Corporation or its shareholders, or to any third person, is eliminated or limited to the fullest extent as from time to time permitted by Utah law. Sections 16-10a-902 and 16-10a-907 of the Utah Revised Business Corporation Act provide that a corporation may indemnify its directors and officers who are made parties to a legal proceeding because of their positions with the corporation against liability incurred in the proceeding if the individual's conduct was in good faith, the individual reasonably believed that his conduct was in, or not opposed to, the corporation's best interests, and in the case of a criminal proceeding, had no reasonable cause to believe his conduct was unlawful. Under the Utah Revised Business Corporation Act, Pliant Corporation may not indemnify its directors or officers in connection with a proceeding by, or in the right of, Pliant Corporation in which the individual was adjudged liable to it or in any proceeding in which the individual was adjudged liable on the basis that he derived an improper personal benefit.

        As authorized by Section 16-10a-841(1) of the Utah Revised Business Corporation Act, the Amended and Restated Bylaws of Pliant Corporation provide that Pliant Corporation's directors shall not be personally liable to Pliant Corporation or its shareholders for monetary damages for any action taken or any failure to take any action, as a director, except liability for: (a) the amount of a financial benefit received by a director to which he or she is not entitled; (b) an intentional infliction of harm on Pliant Corporation or its shareholders; (c) a violation of Section 16-10a-842 of the Utah Revised Business Corporation Act for unlawful distributions; or (d) an intentional violation of criminal law. The Amended and Restated Bylaws also provide for indemnification of Pliant Corporation's directors and officers and advancement of their expenses to the fullest extent as from time to time permitted by applicable law, including, without limitation, Section 16-10a-902 of the Utah Revised Business Corporation Act.

Item 21.    Exhibits and Financial Statement Schedules.

(a)

EXHIBITS

Exhibit Number
2.1	Recapitalization Agreement, dated as of March 31, 2000 (the "Recapitalization Agreement"), among Pliant Corporation, Chase Domestic Investments, L.L.C., Richard P. Durham as Representative, and the shareholders of Pliant Corporation signatory thereto (incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K filed by Pliant Corporation on April 12, 2000).
2.2	Amendment No. 1, dated as of April 3, 2000, to the Recapitalization Agreement (incorporated by reference to Exhibit 2.2 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
2.3	Amendment No. 2, dated as of May 31, 2000, to the Recapitalization Agreement (incorporated by reference to Exhibit 2.3 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).

II-1

3.1	Third Amended and Restated Articles of Incorporation of Pliant Corporation (incorporated by reference to Exhibit 3.1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
3.2	Articles of Amendment of Third Amended and Restated Articles of Incorporation of Pliant Corporation (incorporated by reference to Exhibit 3.2 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2000 filed on April 2, 2001).
3.3	Articles of Amendment of Third Amended and Restated Articles of Incorporation of Pliant Corporation (incorporated by reference to Exhibit 3.3 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.4	Articles of Amendment of Third Amended and Restated Articles of Incorporation of Pliant Corporation (incorporated by reference to Exhibit 3.4 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2002 filed on March 28, 2003).
3.5	Articles of Amendment of Third Amended and Restated Articles of Incorporation of Pliant Corporation (incorporated by reference to Exhibit 3.5 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2002 filed on March 28, 2003).
3.6	Articles of Incorporation of Pliant Corporation International (formerly known as Huntsman Container Corporation International) (incorporated by reference to Exhibit 3.14 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-40067)).
3.7	Articles of Amendment to the Articles of Incorporation of Pliant Corporation International (formerly known as Huntsman Container Corporation International) (incorporated by reference to Exhibit 3.19 to Post-Effective Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
3.8	Articles of Incorporation of Pliant Film Products of Mexico, Inc. (formerly known as Huntsman Film Products of Mexico, Inc.) (incorporated by reference to Exhibit 3.16 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-40067)).
3.9	Articles of Amendment to the Articles of Incorporation of Pliant Film Products of Mexico, Inc. (formerly known as Huntsman Film Products of Mexico, Inc.) (incorporated by reference to Exhibit 3.20 to Post-Effective Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
3.10	Articles of Incorporation of Pliant Solutions Corporation (formerly known as Huntsman KCL Corporation) (incorporated by reference to Exhibit 3.7 to Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
3.11	Articles of Amendment to the Articles of Incorporation of Pliant Solutions Corporation (formerly known as Huntsman KCL Corporation) (incorporated by reference to Exhibit 3.21 to Post-Effective Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
3.12	Articles of Organization of Pliant Packaging of Canada, LLC (formerly known as Huntsman Packaging of Canada, LLC) (incorporated by reference to Exhibit 3.9 to Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
3.13	Certificate of Amendment to the Articles of Organization of Pliant Packaging of Canada, LLC (formerly known as Huntsman Packaging of Canada, LLC) (incorporated by reference to Exhibit 3.18 to Post-Effective Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).

II-2

3.14		Certificate of Incorporation of Uniplast Holdings Inc., as amended (incorporated by reference to Exhibit 3.14 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.15		Certificate of Incorporation of Uniplast U.S., Inc., as amended (incorporated by reference to Exhibit 3.15 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.16		Certificate of Incorporation of Turex, Inc (incorporated by reference to Exhibit 3.16 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.17		Articles of Organization of Pierson Industries, Inc., as amended (incorporated by reference to Exhibit 3.17 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.18		Certificate of Incorporation of Uniplast Midwest, Inc. (incorporated by reference to Exhibit 3.18 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.19	*	Memorandum and Articles of Association of Uniplast Industries Co. (formerly known as 3017010 Nova Scotia Company).
3.20		Second Amended and Restated Bylaws of Pliant Corporation (incorporated by reference to Exhibit 3.6 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2002 filed on March 28, 2003).
3.21		Bylaws of Pliant Corporation International (formerly known as Huntsman Container Corporation International) (incorporated by reference to Exhibit 3.24 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-40067)).
3.22		Bylaws of Pliant Film Products of Mexico, Inc. (formerly known as Huntsman Film Products of Mexico, Inc.) (incorporated by reference to Exhibit 3.26 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-40067)).
3.23		Bylaws of Pliant Solutions Corporation (formerly known as Huntsman KCL Corporation) (incorporated by reference to Exhibit 3.16 to Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
3.24		Operating Agreement of Pliant Packaging of Canada, LLC (formerly known as Huntsman Packaging of Canada, LLC) (incorporated by reference to Exhibit 3.18 to Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
3.25		Bylaws of Uniplast Holdings Inc., as amended (incorporated by reference to Exhibit 3.25 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.26		Bylaws of Uniplast U.S., Inc., as amended (incorporated by reference to Exhibit 3.26 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.27		Bylaws of Turex, Inc. (incorporated by reference to Exhibit 3.27 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.28		Bylaws of Pierson Industries, Inc., as amended (incorporated by reference to Exhibit 3.28 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.29		Code of Bylaws of Uniplast Midwest, Inc. (incorporated by reference to Exhibit 3.29 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.30		Fourth Amended and Restated Articles of Incorporation of Pliant Corporation (incorporated by reference to Exhibit 3.1 to Pliant Corporation's Current Report on Form 8-K filed on September 30, 2004).

II-3

4.1	Indenture, dated as of May 31, 2000, among Pliant Corporation, the Note Guarantors party thereto and The Bank of New York, as trustee (incorporated by reference to Exhibit 4.1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
4.2	First Supplemental 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-1 (File No. 333-65754)).
4.3	Form of Second Supplemental Indenture, dated as of April 30, 2004, among Pliant Corporation, the New Note Guarantor 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-1 (File No. 333-115114)).
4.4	Form of 2000 Notes (incorporated by reference to Exhibit B to Exhibit 4.1).
4.5	Indenture, dated as of April 10, 2002, among Pliant Corporation, the Note Guarantors party thereto and The Bank of New York, as trustee (incorporated by reference to Exhibit 4.4 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-86532)).
4.6	Form of First Supplemental Indenture, dated as of April 30, 2004, among Pliant Corporation, the New Note Guarantor party thereto, the existing Note Guarantors party thereto and Bank of New York, as trustee (incorporated by reference to Exhibit 4.6 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-115114)).
4.7	Form of 2002 Note (incorporated by reference to Exhibit B to Exhibit 4.5).
4.8	Indenture, dated as of May 30, 2003, among Pliant Corporation, the Note Guarantors party thereto and Wilmington Trust Company, as trustee (incorporated by reference to Exhibit 4.6 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-106432)).
4.9	Form of First Supplemental Indenture, dated as of April 30, 2004, among Pliant Corporation, the New Note Guarantor party thereto, the existing Note Guarantors party thereto and Wilmington Trust Company, as trustee (incorporated by reference to Exhibit 4.9 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-115114)).
4.10	Form of Senior Secured Note (incorporated by reference to Exhibit B to Exhibit 4.6) (incorporated by reference to Exhibit 4.6 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-106432)).
4.11	Form of Indenture, dated as of February 17, 2004, among Pliant Corporation, the Note Guarantors party thereto and Wilmington Trust Company, as trustee (incorporated by reference to Exhibit 4.8 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
4.12	Form of Senior Secured Discount Note (incorporated by reference to Exhibit B to Exhibit 4.11)
4.13	Second Priority Security Agreement, dated as of May 30, 2003, among Pliant Corporation, the subsidiary guarantors party thereto and Wilmington Trust Company, as Collateral Agent (incorporated by reference to Exhibit 4.8 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-106432)).
4.14	Form of Supplement No. 1 to Second Priority Security Agreement, dated as of April 30, 2004, among Uniplast Industries Co. and Wilmington Trust Company, as collateral agent (incorporated by reference to Exhibit 4.14 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-115114)).

II-4

4.15	Form of Security Agreement dated as of February 17, 2004, among Pliant Corporation, the subsidiary guarantors party thereto and Wilmington Trust Company, as Collateral Agent (incorporated by reference to Exhibit 4.11 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
4.16	Form of Canadian Security Agreement, dated as of February 17, 2004, among Uniplast Industries Co., the guarantors party thereto, and Wilmington Trust Company, as Collateral Agent (incorporated by reference to Exhibit 4.12 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
4.17	Second Priority Pledge Agreement, dated as of May 30, 2003, among Pliant Corporation, the subsidiary guarantors party thereto and Wilmington Trust Company, as Collateral Agent (incorporated by reference to Exhibit 4.9 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-106432)).
4.18	Form of Supplement No. 1 to the Second Priority Pledge Agreement dated, as of April 30, 2004, among Uniplast Industries Co. and Wilmington Trust Company, as collateral agent (incorporated by reference to Exhibit 4.18 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-115114)).
4.19	Form of Pledge Agreement dated as of February 17, 2004, among Pliant Corporation, the subsidiary pledgors party thereto and Wilmington Trust Company, as Collateral Agent (incorporated by reference to Exhibit 4.14 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
4.20	Form of Canadian Pledge Agreement, dated as of February 17, 2004, among Uniplast Industries Co., the pledgors party thereto, and Wilmington Trust Company, as Collateral Agent (incorporated by reference to Exhibit 4.15 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
4.21	Exchange and Registration Rights Agreement, dated as of May 31, 2000, among Pliant Corporation, the Note Guarantors party thereto, and Chase Securities, Inc. and Deutsche Bank Securities Inc., as Initial Purchasers (incorporated by reference to Exhibit 4.3 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
4.22	Exchange and Registration Rights Agreement, dated as of April 10, 2002, among Pliant Corporation, the Note Guarantors party thereto, and J.P. Morgan Securities, Inc. and Deutsche Bank Securities Inc., as Initial Purchasers (incorporated by reference to Exhibit 4.7 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-86532)).
4.23	Exchange and Registration Rights Agreement, dated as of May 30, 2003, among Pliant Corporation, the Note Guarantors party thereto, and J.P. Morgan Securities Inc., Deutsche Bank Securities, Inc. and Credit Suisse First Boston LLC, as Initial Purchasers (incorporated by reference to Exhibit 4.12 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-106432)).
4.24	Form of Exchange and Registration Rights Agreement, dated as of February 17, 2004, among Pliant Corporation, the Note Guarantors party thereto, and J.P. Morgan Securities Inc., Credit Suisse First Boston LLC and Deutsche Bank Securities Inc., as Initial Purchasers (incorporated by reference to Exhibit 4.19 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
4.25	Fourth Amended and Restated Articles of Incorporation of Pliant Corporation (incorporated by reference to Exhibit 3.1 to Pliant Corporation's Current Report on Form 8-K filed on September 30, 2004).

II-5

4.26		Amended and Restated Indenture, dated as of February 17, 2004 (as amended and restated as of May 6, 2005).
4.27		Exchange and Registration Rights Agreement, dated as of May 6, 2005.
5.1	*	Opinion of Sonnenschein Nath & Rosenthal LLP.
5.2	*	Opinion of Stewart McKelvey Stirling Scales, special Nova Scotia counsel.
8.1	*	Opinion of Sonnenschein Nath and Rosenthal LLP (included in Exhibit 5.1)
10.1		Note Warrant Agreement, dated as of May 31, 2000, among Pliant Corporation and The Bank of New York, as Warrant Agent, relating to the 220,000 Note Warrants (incorporated by reference to Exhibit 10.1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.2		Stockholders' 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 10.2 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.3		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-1 (File No. 333-65754)).
10.4		Amendment No. 2, dated as of December 19, 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 10.4 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2001).
10.5		Amendment No. 3, dated as of March 25, 2003, 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 10.5 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2002 filed on March 28, 2003).
10.6		Amendment No. 4, dated as of June 5, 2003, 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 10.6 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-106432)).
10.7		Registration Rights 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. 333-42008)).
10.8		Amendment No. 1, dated as of June 13, 2000, to the Registration Rights 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 10.4 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).

II-6

10.9	Amendment No. 2, dated as of March 25, 2003, to the Registration Rights 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 10.8 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2002 filed on March 28, 2003).
10.10	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 10.5 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.11	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-1 (File No. 333-65754)).
10.12	Warrant Agreement, dated as of May 31, 2000, among Pliant Corporation and Chase Domestic Investments, L.L.C. (incorporated by reference to Exhibit 10.6 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.13	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-1 (File No. 333-65754)).
10.14	Amendment No. 2, dated as of March 25, 2003, 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 10.13 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2002 filed on March 28, 2003).
10.15	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-1 (File No. 333-65754)).
10.16	Securities Purchase Agreement, dated as of March 25, 2003, among Pliant Corporation and the Purchasers named therein (incorporated by reference to Exhibit 10.15 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2002 filed on March 28, 2003).
10.17	Securities Purchase Agreement, dated as of March 25, 2003, between Pliant Corporation and J.P. Morgan Partners (BHCA), L.P. (incorporated by reference to Exhibit 10.16 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2002 filed on March 28, 2003).
10.18	Form of Purchase Agreement, dated as of February 6, 2004, among Pliant Corporation, J. P. Morgan Securities Inc., Credit Suisse First Boston LLC and Deutsche Bank Securities Inc. (incorporated by reference to Exhibit 10.18 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).

II-7

10.19	Form of Credit Agreement, dated as of February 17, 2004, among Pliant Corporation, Uniplast Industries Co., the subsidiary borrowers party thereto, the various lenders party thereto, Credit Suisse First Boston, as Administrative Agent and Documentation Agent, Deutsche Bank Trust Company Americas, as Collateral Agent, General Electric Capital Corporation, as Co-Collateral Agent, and JPMorgan Chase Bank, as Syndication Agent (incorporated by reference to Exhibit 10.19 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
10.20	Form of Consent and Amendment, dated as of March 8, 2004, to the Credit Agreement dated as of February 17, 2004, among Pliant Corporation, Uniplast Industries Co., the subsidiary borrowers party to the Credit Agreement, the financial institutions party to the Credit Agreement as Lenders, Credit Suisse First Boston, as Administrative Agent and Documentation Agent, Deutsche Bank Trust Company Americas, as Collateral Agent, General Electric Capital Corporation, as Co-Collateral Agent, and JPMorgan Chase Bank, as Syndication Agent (incorporated by reference to Exhibit 10.20 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
10.21	Form of Amended and Restated Intercreditor Agreement, dated as of February 17, 2004, among Deutsche Bank Trust Company Americas, as Credit Agent, Wilmington Trust Company, as Second Priority Noteholder Agent and as 2004 Noteholder Agent, and Pliant Corporation (incorporated by reference to Exhibit 10.21 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
10.22	Form of Guarantee Agreement, dated as of February 17, 2004, among Pliant Corporation, Uniplast Industries Co., the subsidiaries guarantors party thereto and Credit Suisse First Boston, as Administrative Agent (incorporated by reference to Exhibit 10.22 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
10.23	Form of Domestic Security Agreement, dated as of February 17, 2004, among Pliant Corporation, the subsidiary guarantors party thereto and Deutsche Bank Trust Company Americas, as Collateral Agent (incorporated by reference to Exhibit 10.23 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
10.24	Form of Canadian Security Agreement, dated as of February 17, 2004, among Uniplast Industries Co., the guarantors party thereto, and Deutsche Bank Trust Company Americas, as Collateral Agent (incorporated by reference to Exhibit 10.24 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
10.25	Form of Domestic Pledge Agreement, dated as of February 17, 2004, among Pliant Corporation, the subsidiary pledgors party thereto and Deutsche Bank Trust Company Americas, as Collateral Agent (incorporated by reference to Exhibit 10.25 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
10.26	Form of Canadian Pledge Agreement, dated as of February 17, 2004, among Uniplast Industries Co., the pledgors party thereto, and Deutsche Bank Trust Company Americas, as Collateral Agent (incorporated by reference to Exhibit 10.26 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).

II-8

10.27	Form of Indemnity, Subrogation and Contribution Agreement, dated as of February 17, 2004, among Pliant Corporation, Uniplast Industries Co., the subsidiary guarantors party thereto and Credit Suisse First Boston, as Administrative Agent (incorporated by reference to Exhibit 10.27 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
10.28	Employment Agreement, dated as of May 31, 2000, between Pliant Corporation and Richard P. Durham (incorporated by reference to Exhibit 10.12 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.29	Amendment No. 1, dated as of February 1, 2001, to the Employment Agreement, dated as of May 31, 2000, between Pliant Corporation and Richard P. Durham (incorporated by reference to Exhibit 10.14 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2000 filed on April 2, 2001).
10.30	Separation Agreement, dated as of June 10, 2002, between Pliant Corporation and Richard P. Durham (incorporated by reference to Exhibit 10.1 to Pliant Corporation's Quarterly Report on Form 10-Q for the quarter ended June 30, 2002).
10.31	Employment Agreement, dated as of May 31, 2000, between Pliant Corporation and Jack E. Knott (incorporated by reference to Exhibit 10.13 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008) ).
10.32	Employment Agreement, dated as of May 31, 2000, between Pliant Corporation and Scott K. Sorensen (incorporated by reference to Exhibit 10.14 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.33	Letter Agreement, dated as of December 27, 2000, terminating the Employment Agreement, dated as of May 31, 2000, between Pliant Corporation and Scott K. Sorensen (incorporated by reference to Exhibit 10.17 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2000 filed on April 2, 2001).
10.34	Employment Agreement, dated as of May 31, 2000, between Pliant Corporation and Ronald G. Moffitt (incorporated by reference to Exhibit 10.15 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.35	Letter Agreement, dated as of January 22, 2001, terminating the Employment Agreement, dated as of May 31, 2000, between Pliant Corporation and Ronald G. Moffitt (incorporated by reference to Exhibit 10.19 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2000 filed on April 2, 2001).
10.36	Employment Agreement, dated as of March 30, 2001, between Pliant Corporation and Brian E. Johnson (incorporated by reference to Exhibit 10.30 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2001).
10.37	Restricted Stock Agreement, dated as of May 31, 2000, between Pliant Corporation and Richard P. Durham (incorporated by reference to Exhibit 10.16 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.38	Restricted Stock Agreement, dated as of May 31, 2000, between Pliant Corporation and Jack E. Knott (incorporated by reference to Exhibit 10.17 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.39	Restricted Stock Agreement, dated as of May 31, 2000, between Pliant Corporation and Scott K. Sorensen (incorporated by reference to Exhibit 10.18 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).

II-9

10.40	Stock Redemption Agreement, dated as of December 27, 2000, between Pliant Corporation and Scott K. Sorensen (incorporated by reference to Exhibit 10.23 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2000 filed on April 2, 2001).
10.41	Restricted Stock Agreement, dated as of May 31, 2000, between Pliant Corporation and Ronald G. Moffitt (incorporated by reference to Exhibit 10.19 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.42	Stock Redemption Agreement, dated as of February 1, 2001, between Pliant Corporation and Ronald G. Moffitt (incorporated by reference to Exhibit 10.25 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2000 filed on April 2, 2001).
10.43	Pledge Agreement, dated as of May 31, 2000, in favor of Pliant Corporation made by Richard P. Durham (incorporated by reference to Exhibit 10.20 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.44	Amendment No. 1, dated as of March 1, 2001, to the Pledge Agreement dated as of May 31, 2000, among Pliant Corporation and Richard P. Durham (incorporated by reference to Exhibit 10.35 to Post-Effective Amendment No. 2 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.45	Pledge Agreement, dated as of May 31, 2000, in favor of Pliant Corporation made by Jack E. Knott (incorporated by reference to Exhibit 10.21 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.46	Amendment No. 1, dated as of April 1, 2001, to the Pledge Agreement dated as of May 31, 2000, among Pliant Corporation and Jack E. Knott (incorporated by reference to Exhibit 10.36 to Post-Effective Amendment No. 2 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.47	Pledge Agreement, dated as of May 31, 2000, in favor of Pliant Corporation made by Scott K. Sorensen (incorporated by reference to Exhibit 10.22 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.48	Pledge Agreement, dated as of May 31, 2000, in favor of Pliant Corporation made by Ronald G. Moffitt (incorporated by reference to Exhibit 10.23 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.49	1998 Pliant Corporation Stock Option Plan (incorporated by reference to Exhibit 10.10 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 1998).
10.50	Pliant Corporation Management Incentive Plan for Senior Divisional Management (1999) (incorporated by reference to Exhibit 10.1 to Pliant Corporation's Quarterly Report on Form 10-Q for the quarter ended March 31, 2000).
10.51	Pliant Corporation 2000 Stock Incentive Plan (as amended and restated through April 17, 2002) (incorporated by reference to Exhibit 10.54 to Pliant Corporation's Annual report on Form 10-K for the year ended December 31, 2002 filed on March 28, 2003).
10.52	Second Amended and Restated Stock Option Agreement, dated as of May 31, 2000 between Pliant Corporation and Jack E. Knott (incorporated by reference to Exhibit 10.27 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.53	Pliant Corporation Management Incentive Plan (2000) (incorporated by reference to Exhibit 10.2 to Pliant Corporation's Quarterly Report on Form 10-Q for the quarter ended March 31, 2000).

II-10

10.54	Pliant Corporation Management Incentive Plan (2001) (incorporated by reference to Exhibit 10.48 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2001).
10.55	Pliant Corporation Management Incentive Plan (2002) (incorporated by reference to Exhibit 10.49 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2001).
10.56	Pliant Corporation Management Incentive Plan (2003) (incorporated by reference to Exhibit 10.56 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
10.57	Pliant Corporation 2002 Stock Incentive Plan (incorporated by reference to Exhibit 10.1 to Pliant Corporation's Quarterly Report on Form 10-Q for the quarter ended September 30, 2002).
10.58	Consulting Agreement dated as of August 24, 2003, between Pliant corporation and Edward A. Lapekas (incorporated by reference to Exhibit 10.63 to Post-Effective Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-107843).
10.59	Separation Agreement, dated as of September 8, 2003, between Pliant Corporation and Jack E. Knott (incorporated by reference to Exhibit 10.64 to Post-Effective Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-107843).
10.60	Separation Agreement, dated as of September 8, 2003, between Pliant Corporation and Elise H. Scroggs (incorporated by reference to Exhibit 10.65 to Post-Effective Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-107843).
10.61	Employment Agreement, dated January 1, 2004, between Pliant Corporation and Harold Bevis (incorporated by reference to Exhibit 10.61 to Pliant Corporation Annual Report on Form 10-K for the year ended December 31, 2004).
10.62	Release Agreement, dated December 31, 2004, between Pliant Corporation and Brian Johnson (incorporated by reference to Exhibit 10.62 to Pliant Corporation Annual Report on Form 10-K for the year ended December 31, 2004).
10.63	Letter Agreement, dated January 26, 2005, between Pliant Corporation and James Ide (incorporated by reference to Exhibit 10.63 to Pliant Corporation Annual Report on Form 10-K for the year ended December 31, 2004).
10.64	Severance and Release Agreement, dated as of March 18, 2005, between Pliant Corporation and Lori Roberts (incorporated by reference to Exhibit 10.64 to Pliant Corporation Annual Report on Form 10-K for the year ended December 31, 2004).
10.65	Pliant Corporation 2004 Management Incentive Compensation Plan (incorporated by reference to Exhibit 10.65 to Pliant Corporation Annual Report on Form 10-K for the year ended December 31, 2004).
10.66	Pliant Corporation 2004 MIP Long Term Incentive Plan (incorporated by reference to Exhibit 10.66 to Pliant Corporation Annual Report on Form 10-K for the year ended December 31, 2004).
10.67	Pliant Corporation 2004 Restricted Stock Incentive Plan (incorporated by reference to Exhibit 10.1 to Pliant Corporation's Current Report on Form 8-K filed on September 30, 2004).

II-11

10.68		Pliant Corporation 2004 Restricted Stock Incentive Plan Form of Restricted Stock Agreement (incorporated by reference to Exhibit 10.68 to Pliant Corporation Annual Report on Form 10-K for the year ended December 31, 2004).
10.69		Fourth Amendment to the Pliant Corporation Defined Benefit Pension Plan (incorporated by reference to Exhibit 10.69 to Pliant Corporation Annual Report on Form 10-K for the year ended December 31, 2004).
10.70		Buy Out Agreement, dated January 5, 2005, among Pliant Corporation, Pliant Investment, Inc. and Supreme Plastics Group PLC (incorporated by reference to Exhibit 10.70 to Pliant Corporation Annual Report on Form 10-K for the year ended December 31, 2004).
10.71		Assignment of Limited Liability Company Interests, dated January 5, 2005, between Pliant Investment, Inc. and Supreme Plastics Group PLC (incorporated by reference to Exhibit 10.71 to Pliant Corporation Annual Report on Form 10-K for the year ended December 31, 2004).
10.72		Agreement for Purchase and Sale of Assets, dated July 12, 2004, among Pliant Corporation, Pliant Solutions Corporation and Kittrich Corporation (incorporated by reference to Exhibit 10.1 to Pliant Corporation's Current Report on Form 8-K filed on October 6, 2004).
10.73		Form of Amendment to Credit Agreement (incorporated by reference to Exhibit 10.61 to Pliant Corporation's Current Report on Form 8-K filed on December 23, 2004).
10.74		Pliant Corporation 2005 Management Incentive Compensation Plan (incorporated by reference to Exhibit 10.1 to Pliant Corporation's Current Report on Form 8-K (filed on June 13, 2005)).
10.75		Exhibits to Pliant Corporation 2005 Management Incentive Compensation Plan for R. David Corey Plan (incorporated by reference to Exhibit 10.2 to Pliant Corporation's Current Report on Form 8-K (filed June 13, 2005)).
10.76		Exhibits to Pliant Corporation 2005 Management Incentive Compensation Plan for Paul R. Frantz Plan (incorporated by reference to Exhibit 10.3 to Pliant Corporation's Current Report on Form 8-K (filed June 13, 2005)).
10.77		Exhibits to Pliant Corporation 2005 Management Incentive Compensation Plan for Greg E. Gard Plan (incorporated by reference to Exhibit 10.4 to Pliant Corporation's Current Report on Form 8-K (filed June 13, 2005)).
10.78		Exhibits to Pliant Corporation 2005 Management Incentive Compensation Plan for Kenneth J. Swanson Plan (incorporated by reference to Exhibit 10.5 to Pliant Corporation's Current Report on Form 8-K (filed June 13, 2005)).
10.79		Employment Agreement, dated June 10, 2005, between Pliant Corporation and R. David Corey (incorporated by reference to Exhibit 10.6 to Pliant Corporation's Current Report on Form 8-K (filed on June 13, 2005)).
10.80		Amended and Restated Indenture, dated as of February 17, 2004 (as amended and restated May 6, 2005) (incorporated by reference to Exhibit 4.26)
10.81		Exchange and Registration Rights Agreement, dated as of May 6, 2005 (incorporated by reference to Exhibit 4.27).
21.1		Subsidiaries of Pliant Corporation (incorporated by reference to Exhibit 21.1 to Pliant Corporation Annual Report on Form 10-K for the year ended December 31, 2004).
23.1	*	Consent of Sonnenschein Nath & Rosenthal LLP (included in Exhibit 5.1).
23.2	*	Consent of Stewart McKelvey Stirling Scales (included in Exhibit 5.6).

II-12

23.3		Consent of Ernst & Young LLP.
24.1		Powers of Attorney.
25.1		Form T-1 Statement of Eligibility and Qualifications under the Trust Indenture Act of 1939 of The Bank of New York, as Trustee (incorporated by reference to Exhibit 25.1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
25.2		Form T-1 Statement of Eligibility and Qualifications under the Trust Indenture Act of 1939 of The Bank of New York, as Trustee (incorporated by reference to Exhibit 25.1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-86532)).
25.3	*	Form T-1 Statement of Eligibility and Qualifications under the Trust Indenture Act of 1939 of Wilmington Trust Company, as Trustee.
99.1		Letter of Pliant Corporation regarding Arthur Andersen LLP (incorporated by reference to Exhibit 99.1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-86532)).
99.2	*	Form of Letter of Transmittal.
99.3	*	Form of Notice of Guaranteed Delivery.
99.4	*	Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees.
99.5	*	Form of Letter to Clients.

*

Previously filed as part of this Registration Statement.

(b)

FINANCIAL STATEMENT SCHEDULES

        Pliant Corporation and Subsidiaries—Schedule II—Valuation and Qualifying Accounts for the years ended December 31, 2004, 2003 and 2002 (included on page S-1 of the prospectus filed pursuant to Part I of this registration statement).

        Schedules other than the above have been omitted because they are either not applicable or the required information has been disclosed in the financial statements or notes thereto.

Item 17.    Undertakings.

        Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrants pursuant to the forgoing provisions, or otherwise, the Registrants have been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrants of expenses incurred or paid by a director, officer or controlling person of the Registrants in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrants will, unless in the opinion of their counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by them is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

        The undersigned Registrants hereby undertake:

        1.     To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement;

(a)

To include any prospectus required by Section 10(a)(3) of the Securities Act;

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(b)

To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in the volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; and



(c)

To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;

        2.     That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof; and

        3.     To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

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SIGNATURES

        Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this Amendment No. 2 to the registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Schaumburg, in the State of Illinois, on the 16^th day of June, 2005.

PLIANT CORPORATION
By	/s/  HAROLD C. BEVISHarold C. Bevis Chief Executive Officer

        Pursuant to the requirements of the Securities Exchange Act of 1934, this Amendment No. 2 to the registration statement has been signed on June 16, 2005 by the following persons in the capacities indicated.

By	/s/  HAROLD C. BEVIS Harold C. Bevis, Chief Executive Officer, Acting Chief Financial Officer and Director (Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer)
By	/s/  JOHN D. BOWLIN* John D. Bowlin, Director
By	/s/  RICHARD P. DURHAM* Richard P. Durham, Director
By	/s/  SEAN EPPS* Sean Epps, Director
By	/s/  EDWARD A. LAPEKAS* Edward A. Lapekas, Director
By	/s/  ALBERT MACMILLAN* Albert MacMillan, Director
By	/s/  JEFFREY C. WALKER* Jeffrey C. Walker, Director
By	/s/  TIMOTHY J. WALSH* Timothy J. Walsh, Director

*By:
/s/  JOSEPH J. KWEDERIS (Joseph J. Kwederis, as
ATTORNEY-IN-FACT)

II-15

SIGNATURES

        Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this Amendment No. 2 to the registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Schaumburg, in the State of Illinois, on the 16^th day of June, 2005.

PLIANT CORPORATION INTERNATIONAL
By:	/s/  HAROLD C. BEVISHarold C. Bevis President

        Pursuant to the requirements of the Securities Act of 1933, this Amendment No. 2 to the registration statement has been signed on June 16, 2005 by the following persons in the capacities indicated:

Signature	Title
/s/  HAROLD C. BEVISHarold C. Bevis	President and Director (Principal Executive Officer)
/s/  JOSEPH J. KWEDERISJoseph J. Kwederis	Executive Vice President, Chief Financial Officer and Director (Principal Financial Officer and Principal Accounting Officer)

II-16

SIGNATURES

        Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this Amendment No. 2 to the registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Schaumburg, in the State of Illinois, on the 16^th day of June, 2005.

PLIANT FILM PRODUCTS OF MEXICO, INC.
By:	/s/  HAROLD C. BEVISHarold C. Bevis President

        Pursuant to the requirements of the Securities Act of 1933, this Amendment No. 2 to the registration statement has been signed on June 16, 2005 by the following persons in the capacities indicated:

Signature	Title
/s/  HAROLD C. BEVISHarold C. Bevis	President and Director (Principal Executive Officer)
/s/  JOSEPH J. KWEDERISJoseph J. Kwederis	Executive Vice President, Chief Financial Officer and Director (Principal Financial Officer and Principal Accounting Officer)

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SIGNATURES

        Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this Amendment No. 2 to the registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Schaumburg, in the State of Illinois, on the 16^th day of June, 2005.

PLIANT SOLUTIONS CORPORATION
By:	/s/  HAROLD C. BEVISHarold C. Bevis Executive Vice President

        Pursuant to the requirements of the Securities Act of 1933, this Amendment No. 2 to the registration statement has been signed on June 16, 2005 by the following persons in the capacities indicated:

Signature	Title
/s/  HAROLD C. BEVISHarold C. Bevis	Executive Vice President and Director (Principal Executive Officer)
/s/  JOSEPH J. KWEDERISJoseph J. Kwederis	Executive Vice President, Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)
/s/  CHRIS M. NIELSENChris M. Nielsen	Director

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SIGNATURES

        Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this Amendment No. 2 to the registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Schaumburg, in the State of Illinois, on the 16^th day of June, 2005.

PLIANT PACKAGING OF CANADA, LLC
By:	/s/  HAROLD C. BEVISHarold C. Bevis President

        Pursuant to the requirements of the Securities Act of 1933, this Amendment No. 2 to the registration statement has been signed on June 16, 2005 by the following persons in the capacities indicated:

Signature	Title
/s/  HAROLD C. BEVIS Harold C. Bevis	President and Manager (Principal Executive Officer)
/s/  CHRIS M. NIELSEN Chris M. Nielsen	Treasurer, Secretary and Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)
/s/  R. DAVID COREY R. David Corey	Manager

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SIGNATURES

        Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this Amendment No. 2 to the registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Schaumburg, in the State of Illinois, on the 16^th day of June, 2005.

UNIPLAST HOLDINGS INC.
By:	/s/  HAROLD C. BEVISHarold C. Bevis Executive Vice President

        Pursuant to the requirements of the Securities Act of 1933, this Amendment No. 2 to the registration statement has been signed on June 16, 2005 by the following persons in the capacities indicated:

Signature	Title
/s/  R. DAVID COREYR. David Corey	President and Director (Principal Executive Officer)
/s/  JOSEPH J. KWEDERISJoseph J. Kwederis	Executive Vice President, Chief Financial Officer and Director (Principal Financial Officer and Principal Accounting Officer)
/s/  CHRIS M. NIELSENChris M. Nielsen	Director
/s/  HAROLD C. BEVISHarold C. Bevis	Executive Vice President and Director

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SIGNATURES

        Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this Amendment No. 2 to the registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Schaumburg, in the State of Illinois, on the 16^th day of June, 2005.

UNIPLAST U.S., INC.
By:	/s/  HAROLD C. BEVISHarold C. Bevis Executive Vice President

        Pursuant to the requirements of the Securities Act of 1933, this Amendment No. 2 to the registration statement has been signed on June 16, 2005 by the following persons in the capacities indicated:

Signature	Title
/s/  R. DAVID COREYR. David Corey	President and Director (Principal Executive Officer)
/s/  JOSEPH J. KWEDERISJoseph J. Kwederis	Executive Vice President and Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)
/s/  HAROLD C. BEVISHarold C. Bevis	Executive Vice President and Director

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SIGNATURES

        Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this Amendment No. 2 to the registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Schaumburg, in the State of Illinois, on the 16^th day of June, 2005.

UNIPLAST INDUSTRIES CO.
By:	/s/  HAROLD C. BEVISHarold C. Bevis Chief Executive Officer

        Pursuant to the requirements of the Securities Act of 1933, this Amendment No. 2 to the registration statement has been signed on June 16, 2005 by the following persons in the capacities indicated:

Signature	Title
/s/  HAROLD C. BEVISHarold C. Bevis	Chief Executive Officer and Director (Principal Executive Officer)
/s/  JOSEPH J. KWEDERISJoseph J. Kwederis	Executive Vice President and Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)
/s/  DAVID L. KING*David L. King	Director

*By:
/s/  JOSEPH J. KWEDERIS (Joseph J. Kwederis, as
ATTORNEY-IN-FACT)

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INDEX TO EXHIBITS

Exhibit Number
2.1	Recapitalization Agreement, dated as of March 31, 2000 (the "Recapitalization Agreement"), among Pliant Corporation, Chase Domestic Investments, L.L.C., Richard P. Durham as Representative, and the shareholders of Pliant Corporation signatory thereto (incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K filed by Pliant Corporation on April 12, 2000).
2.2	Amendment No. 1, dated as of April 3, 2000, to the Recapitalization Agreement (incorporated by reference to Exhibit 2.2 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
2.3	Amendment No. 2, dated as of May 31, 2000, to the Recapitalization Agreement (incorporated by reference to Exhibit 2.3 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
3.1	Third Amended and Restated Articles of Incorporation of Pliant Corporation (incorporated by reference to Exhibit 3.1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
3.2	Articles of Amendment of Third Amended and Restated Articles of Incorporation of Pliant Corporation (incorporated by reference to Exhibit 3.2 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2000 filed on April 2, 2001).
3.3	Articles of Amendment of Third Amended and Restated Articles of Incorporation of Pliant Corporation (incorporated by reference to Exhibit 3.3 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.4	Articles of Amendment of Third Amended and Restated Articles of Incorporation of Pliant Corporation (incorporated by reference to Exhibit 3.4 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2002 filed on March 28, 2003).
3.5	Articles of Amendment of Third Amended and Restated Articles of Incorporation of Pliant Corporation (incorporated by reference to Exhibit 3.5 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2002 filed on March 28, 2003).
3.6	Articles of Incorporation of Pliant Corporation International (formerly known as Huntsman Container Corporation International) (incorporated by reference to Exhibit 3.14 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-40067)).
3.7	Articles of Amendment to the Articles of Incorporation of Pliant Corporation International (formerly known as Huntsman Container Corporation International) (incorporated by reference to Exhibit 3.19 to Post-Effective Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
3.8	Articles of Incorporation of Pliant Film Products of Mexico, Inc. (formerly known as Huntsman Film Products of Mexico, Inc.) (incorporated by reference to Exhibit 3.16 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-40067)).
3.9	Articles of Amendment to the Articles of Incorporation of Pliant Film Products of Mexico, Inc. (formerly known as Huntsman Film Products of Mexico, Inc.) (incorporated by reference to Exhibit 3.20 to Post-Effective Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).

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3.10	Articles of Incorporation of Pliant Solutions Corporation (formerly known as Huntsman KCL Corporation) (incorporated by reference to Exhibit 3.7 to Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
3.11	Articles of Amendment to the Articles of Incorporation of Pliant Solutions Corporation (formerly known as Huntsman KCL Corporation) (incorporated by reference to Exhibit 3.21 to Post-Effective Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
3.12	Articles of Organization of Pliant Packaging of Canada, LLC (formerly known as Huntsman Packaging of Canada, LLC) (incorporated by reference to Exhibit 3.9 to Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
3.13	Certificate of Amendment to the Articles of Organization of Pliant Packaging of Canada, LLC (formerly known as Huntsman Packaging of Canada, LLC) (incorporated by reference to Exhibit 3.18 to Post-Effective Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
3.14	Certificate of Incorporation of Uniplast Holdings Inc., as amended (incorporated by reference to Exhibit 3.14 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.15	Certificate of Incorporation of Uniplast U.S., Inc., as amended (incorporated by reference to Exhibit 3.15 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.16	Certificate of Incorporation of Turex, Inc (incorporated by reference to Exhibit 3.16 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.17	Articles of Organization of Pierson Industries, Inc., as amended (incorporated by reference to Exhibit 3.17 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.18	Certificate of Incorporation of Uniplast Midwest, Inc. (incorporated by reference to Exhibit 3.18 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.19*	Memorandum and Articles of Association of Uniplast Industries Co. (formerly known as 3017010 Nova Scotia Company).
3.20	Second Amended and Restated Bylaws of Pliant Corporation (incorporated by reference to Exhibit 3.6 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2002 filed on March 28, 2003).
3.21	Bylaws of Pliant Corporation International (formerly known as Huntsman Container Corporation International) (incorporated by reference to Exhibit 3.24 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-40067) ).
3.22	Bylaws of Pliant Film Products of Mexico, Inc. (formerly known as Huntsman Film Products of Mexico, Inc.) (incorporated by reference to Exhibit 3.26 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-40067) ).
3.23	Bylaws of Pliant Solutions Corporation (formerly known as Huntsman KCL Corporation) (incorporated by reference to Exhibit 3.16 to Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008) ).

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3.24	Operating Agreement of Pliant Packaging of Canada, LLC (formerly known as Huntsman Packaging of Canada, LLC) (incorporated by reference to Exhibit 3.18 to Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
3.25	Bylaws of Uniplast Holdings Inc., as amended (incorporated by reference to Exhibit 3.25 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.26	Bylaws of Uniplast U.S., Inc., as amended (incorporated by reference to Exhibit 3.26 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.27	Bylaws of Turex, Inc. (incorporated by reference to Exhibit 3.27 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.28	Bylaws of Pierson Industries, Inc., as amended (incorporated by reference to Exhibit 3.28 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.29	Code of Bylaws of Uniplast Midwest, Inc. (incorporated by reference to Exhibit 3.29 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-65754)).
3.30	Fourth Amended and Restated Articles of Incorporation of Pliant Corporation (incorporated by reference to Exhibit 3.1 to Pliant Corporation's Current Report on Form 8-K filed on September 30, 2004).
4.1	Indenture, dated as of May 31, 2000, among Pliant Corporation, the Note Guarantors party thereto and The Bank of New York, as trustee (incorporated by reference to Exhibit 4.1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
4.2	First Supplemental 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-1 (File No. 333-65754)).
4.3	Form of Second Supplemental Indenture, dated as of April 30, 2004, among Pliant Corporation, the New Note Guarantor 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-1 (File No. 333-115114)).
4.4	Form of 2000 Notes (incorporated by reference to Exhibit B to Exhibit 4.1).
4.5	Indenture, dated as of April 10, 2002, among Pliant Corporation, the Note Guarantors party thereto and The Bank of New York, as trustee (incorporated by reference to Exhibit 4.4 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-86532)).
4.6	Form of First Supplemental Indenture, dated as of April 30, 2004, among Pliant Corporation, the New Note Guarantor party thereto, the existing Note Guarantors party thereto and Bank of New York, as trustee (incorporated by reference to Exhibit 4.6 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-115114)).
4.7	Form of 2002 Note (incorporated by reference to Exhibit B to Exhibit 4.5).
4.8	Indenture, dated as of May 30, 2003, among Pliant Corporation, the Note Guarantors party thereto and Wilmington Trust Company, as trustee (incorporated by reference to Exhibit 4.6 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-106432)).

II-25

4.9	Form of First Supplemental Indenture, dated as of April 30, 2004, among Pliant Corporation, the New Note Guarantor party thereto, the existing Note Guarantors party thereto and Wilmington Trust Company, as trustee (incorporated by reference to Exhibit 4.9 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-115114)).
4.10	Form of Senior Secured Note (incorporated by reference to Exhibit B to Exhibit 4.6) (incorporated by reference to Exhibit 4.6 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-106432)).
4.11	Form of Indenture, dated as of February 17, 2004, among Pliant Corporation, the Note Guarantors party thereto and Wilmington Trust Company, as trustee (incorporated by reference to Exhibit 4.8 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
4.12	Form of Senior Secured Discount Note (incorporated by reference to Exhibit B to Exhibit 4.11)
4.13	Second Priority Security Agreement, dated as of May 30, 2003, among Pliant Corporation, the subsidiary guarantors party thereto and Wilmington Trust Company, as Collateral Agent (incorporated by reference to Exhibit 4.8 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-106432)).
4.14	Form of Supplement No. 1 to Second Priority Security Agreement, dated as of April 30, 2004, among Uniplast Industries Co. and Wilmington Trust Company, as collateral agent (incorporated by reference to Exhibit 4.14 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-115114)).
4.15	Form of Security Agreement dated as of February 17, 2004, among Pliant Corporation, the subsidiary guarantors party thereto and Wilmington Trust Company, as Collateral Agent (incorporated by reference to Exhibit 4.11 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
4.16	Form of Canadian Security Agreement, dated as of February 17, 2004, among Uniplast Industries Co., the guarantors party thereto, and Wilmington Trust Company, as Collateral Agent (incorporated by reference to Exhibit 4.12 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
4.17	Second Priority Pledge Agreement, dated as of May 30, 2003, among Pliant Corporation, the subsidiary guarantors party thereto and Wilmington Trust Company, as Collateral Agent (incorporated by reference to Exhibit 4.9 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-106432)).
4.18	Form of Supplement No. 1 to Second Priority Pledge Agreement, dated as of April 30, 2004, among Uniplast Industries Co. and Wilmington Trust Company, as collateral agent (incorporated by reference to Exhibit 4.18 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-115114)).
4.19	Form of Pledge Agreement dated as of February 17, 2004, among Pliant Corporation, the subsidiary pledgors party thereto and Wilmington Trust Company, as Collateral Agent (incorporated by reference to Exhibit 4.14 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).

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4.20	Form of Canadian Pledge Agreement, dated as of February 17, 2004, among Uniplast Industries Co., the pledgors party thereto, and Wilmington Trust Company, as Collateral Agent (incorporated by reference to Exhibit 4.15 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
4.21	Exchange and Registration Rights Agreement, dated as of May 31, 2000, among Pliant Corporation, the Note Guarantors party thereto, and Chase Securities, Inc. and Deutsche Bank Securities Inc., as Initial Purchasers (incorporated by reference to Exhibit 4.3 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
4.22	Exchange and Registration Rights Agreement, dated as of April 10, 2002, among Pliant Corporation, the Note Guarantors party thereto, and J.P. Morgan Securities, Inc. and Deutsche Bank Securities Inc., as Initial Purchasers (incorporated by reference to Exhibit 4.7 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-86532)).
4.23	Exchange and Registration Rights Agreement, dated as of May 30, 2003, among Pliant Corporation, the Note Guarantors party thereto, and J.P. Morgan Securities Inc., Deutsche Bank Securities, Inc. and Credit Suisse First Boston LLC, as Initial Purchasers (incorporated by reference to Exhibit 4.12 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-106432)).
4.24	Form of Exchange and Registration Rights Agreement, dated as of February 17, 2004, among Pliant Corporation, the Note Guarantors party thereto, and J.P. Morgan Securities Inc., Credit Suisse First Boston LLC and Deutsche Bank Securities Inc., as Initial Purchasers (incorporated by reference to Exhibit 4.19 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
4.25	Fourth Amended and Restated Articles of Incorporation of Pliant Corporation (incorporated by reference to Exhibit 3.1 to Pliant Corporation's Current Report on Form 8-K filed on September 30, 2004).
4.26	Amended and Restated Indenture, dated as of February 17, 2004 (as amended and restated as of May 6, 2005).
4.27	Exchange and Registration Rights Agreement, dated as of May 6, 2005.
5.1*	Opinion of Sonnenschein Nath & Rosenthal LLP.
5.2*	Opinion of Stewart McKelvey Stirling Scales, special Nova Scotia counsel.
8.1*	Opinion of Sonnenschein Nath and Rosenthal LLP (included in Exhibit 5.1)
10.1	Note Warrant Agreement, dated as of May 31, 2000, among Pliant Corporation and The Bank of New York, as Warrant Agent, relating to the 220,000 Note Warrants (incorporated by reference to Exhibit 10.1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.2	Stockholders' 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 10.2 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).

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10.3	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-1 (File No. 333-65754)).
10.4	Amendment No. 2, dated as of December 19, 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 10.4 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2001).
10.5	Amendment No. 3, dated as of March 25, 2003, 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 10.5 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2002 filed on March 28, 2003).
10.6	Amendment No. 4, dated as of June 5, 2003, 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 10.6 to Pliant Corporation's Registration Statement on Form S-1 (File No. 333-106432)).
10.7	Registration Rights 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. 333-42008)).
10.8	Amendment No. 1, dated as of June 13, 2000, to the Registration Rights 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 10.4 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.9	Amendment No. 2, dated as of March 25, 2003, to the Registration Rights 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 10.8 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2002 filed on March 28, 2003).
10.10	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 10.5 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.11	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-1 (File No. 333-65754)).

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10.12	Warrant Agreement, dated as of May 31, 2000, among Pliant Corporation and Chase Domestic Investments, L.L.C. (incorporated by reference to Exhibit 10.6 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008) ).
10.13	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-1 (File No. 333-65754)).
10.14	Amendment No. 2, dated as of March 25, 2003, 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 10.13 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2002 filed on March 28, 2003).
10.15	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-1 (File No. 333-65754)).
10.16	Securities Purchase Agreement, dated as of March 25, 2003, among Pliant Corporation and the Purchasers named therein (incorporated by reference to Exhibit 10.15 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2002 filed on March 28, 2003).
10.17	Securities Purchase Agreement, dated as of March 25, 2003, between Pliant Corporation and J.P. Morgan Partners (BHCA), L.P. (incorporated by reference to Exhibit 10.16 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2002 filed on March 28, 2003).
10.18	Form of Purchase Agreement, dated as of February 6, 2004, among Pliant Corporation, J. P. Morgan Securities Inc., Credit Suisse First Boston LLC and Deutsche Bank Securities Inc. (incorporated by reference to Exhibit 10.18 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
10.19	Form of Credit Agreement, dated as of February 17, 2004, among Pliant Corporation, Uniplast Industries Co., the subsidiary borrowers party thereto, the various lenders party thereto, Credit Suisse First Boston, as Administrative Agent and Documentation Agent, Deutsche Bank Trust Company Americas, as Collateral Agent, General Electric Capital Corporation, as Co-Collateral Agent, and JPMorgan Chase Bank, as Syndication Agent (incorporated by reference to Exhibit 10.19 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
10.20	Form of Consent and Amendment, dated as of March 8, 2004, to the Credit Agreement dated as of February 17, 2004, among Pliant Corporation, Uniplast Industries Co., the subsidiary borrowers party to the Credit Agreement, the financial institutions party to the Credit Agreement as Lenders, Credit Suisse First Boston, as Administrative Agent and Documentation Agent, Deutsche Bank Trust Company Americas, as Collateral Agent, General Electric Capital Corporation, as Co-Collateral Agent, and JPMorgan Chase Bank, as Syndication Agent (incorporated by reference to Exhibit 10.20 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).

II-29

10.21	Form of Amended and Restated Intercreditor Agreement, dated as of February 17, 2004, among Deutsche Bank Trust Company Americas, as Credit Agent, Wilmington Trust Company, as Second Priority Noteholder Agent and as 2004 Noteholder Agent, and Pliant Corporation (incorporated by reference to Exhibit 10.21 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
10.22	Form of Guarantee Agreement, dated as of February 17, 2004, among Pliant Corporation, Uniplast Industries Co., the subsidiaries guarantors party thereto and Credit Suisse First Boston, as Administrative Agent (incorporated by reference to Exhibit 10.22 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
10.23	Form of Domestic Security Agreement, dated as of February 17, 2004, among Pliant Corporation, the subsidiary guarantors party thereto and Deutsche Bank Trust Company Americas, as Collateral Agent (incorporated by reference to Exhibit 10.23 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
10.24	Form of Canadian Security Agreement, dated as of February 17, 2004, among Uniplast Industries Co., the guarantors party thereto, and Deutsche Bank Trust Company Americas, as Collateral Agent (incorporated by reference to Exhibit 10.24 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
10.25	Form of Domestic Pledge Agreement, dated as of February 17, 2004, among Pliant Corporation, the subsidiary pledgors party thereto and Deutsche Bank Trust Company Americas, as Collateral Agent (incorporated by reference to Exhibit 10.25 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
10.26	Form of Canadian Pledge Agreement, dated as of February 17, 2004, among Uniplast Industries Co., the pledgors party thereto, and Deutsche Bank Trust Company Americas, as Collateral Agent (incorporated by reference to Exhibit 10.26 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
10.27	Form of Indemnity, Subrogation and Contribution Agreement, dated as of February 17, 2004, among Pliant Corporation, Uniplast Industries Co., the subsidiary guarantors party thereto and Credit Suisse First Boston, as Administrative Agent (incorporated by reference to Exhibit 10.27 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
10.28	Employment Agreement, dated as of May 31, 2000, between Pliant Corporation and Richard P. Durham (incorporated by reference to Exhibit 10.12 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.29	Amendment No. 1, dated as of February 1, 2001, to the Employment Agreement, dated as of May 31, 2000, between Pliant Corporation and Richard P. Durham (incorporated by reference to Exhibit 10.14 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2000 filed on April 2, 2001).
10.30	Separation Agreement, dated as of June 10, 2002, between Pliant Corporation and Richard P. Durham (incorporated by reference to Exhibit 10.1 to Pliant Corporation's Quarterly Report on Form 10-Q for the quarter ended June 30, 2002).

II-30

10.31	Employment Agreement, dated as of May 31, 2000, between Pliant Corporation and Jack E. Knott (incorporated by reference to Exhibit 10.13 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.32	Employment Agreement, dated as of May 31, 2000, between Pliant Corporation and Scott K. Sorensen (incorporated by reference to Exhibit 10.14 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.33	Letter Agreement, dated as of December 27, 2000, terminating the Employment Agreement, dated as of May 31, 2000, between Pliant Corporation and Scott K. Sorensen (incorporated by reference to Exhibit 10.17 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2000 filed on April 2, 2001).
10.34	Employment Agreement, dated as of May 31, 2000, between Pliant Corporation and Ronald G. Moffitt (incorporated by reference to Exhibit 10.15 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.35	Letter Agreement, dated as of January 22, 2001, terminating the Employment Agreement, dated as of May 31, 2000, between Pliant Corporation and Ronald G. Moffitt (incorporated by reference to Exhibit 10.19 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2000 filed on April 2, 2001).
10.36	Employment Agreement, dated as of March 30, 2001, between Pliant Corporation and Brian E. Johnson (incorporated by reference to Exhibit 10.30 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2001).
10.37	Restricted Stock Agreement, dated as of May 31, 2000, between Pliant Corporation and Richard P. Durham (incorporated by reference to Exhibit 10.16 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008) ).
10.38	Restricted Stock Agreement, dated as of May 31, 2000, between Pliant Corporation and Jack E. Knott (incorporated by reference to Exhibit 10.17 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008) ).
10.39	Restricted Stock Agreement, dated as of May 31, 2000, between Pliant Corporation and Scott K. Sorensen (incorporated by reference to Exhibit 10.18 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008) ).
10.40	Stock Redemption Agreement, dated as of December 27, 2000, between Pliant Corporation and Scott K. Sorensen (incorporated by reference to Exhibit 10.23 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2000 filed on April 2, 2001).
10.41	Restricted Stock Agreement, dated as of May 31, 2000, between Pliant Corporation and Ronald G. Moffitt (incorporated by reference to Exhibit 10.19 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008) ).
10.42	Stock Redemption Agreement, dated as of February 1, 2001, between Pliant Corporation and Ronald G. Moffitt (incorporated by reference to Exhibit 10.25 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2000 filed on April 2, 2001).
10.43	Pledge Agreement, dated as of May 31, 2000, in favor of Pliant Corporation made by Richard P. Durham (incorporated by reference to Exhibit 10.20 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008) ).

II-31

10.44	Amendment No. 1, dated as of March 1, 2001, to the Pledge Agreement dated as of May 31, 2000, among Pliant Corporation and Richard P. Durham (incorporated by reference to Exhibit 10.35 to Post-Effective Amendment No. 2 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.45	Pledge Agreement, dated as of May 31, 2000, in favor of Pliant Corporation made by Jack E. Knott (incorporated by reference to Exhibit 10.21 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.46	Amendment No. 1, dated as of April 1, 2001, to the Pledge Agreement dated as of May 31, 2000, among Pliant Corporation and Jack E. Knott (incorporated by reference to Exhibit 10.36 to Post-Effective Amendment No. 2 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.47	Pledge Agreement, dated as of May 31, 2000, in favor of Pliant Corporation made by Scott K. Sorensen (incorporated by reference to Exhibit 10.22 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008) ).
10.48	Pledge Agreement, dated as of May 31, 2000, in favor of Pliant Corporation made by Ronald G. Moffitt (incorporated by reference to Exhibit 10.23 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008) ).
10.49	1998 Pliant Corporation Stock Option Plan (incorporated by reference to Exhibit 10.10 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 1998).
10.50	Pliant Corporation Management Incentive Plan for Senior Divisional Management (1999) (incorporated by reference to Exhibit 10.1 to Pliant Corporation's Quarterly Report on Form 10-Q for the quarter ended March 31, 2000).
10.51	Pliant Corporation 2000 Stock Incentive Plan (as amended and restated through April 17, 2002) (incorporated by reference to Exhibit 10.54 to Pliant Corporation's Annual report on Form 10-K for the year ended December 31, 2002 filed on March 28, 2003).
10.52	Second Amended and Restated Stock Option Agreement, dated as of May 31, 2000 between Pliant Corporation and Jack E. Knott (incorporated by reference to Exhibit 10.27 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
10.53	Pliant Corporation Management Incentive Plan (2000) (incorporated by reference to Exhibit 10.2 to Pliant Corporation's Quarterly Report on Form 10-Q for the quarter ended March 31, 2000).
10.54	Pliant Corporation Management Incentive Plan (2001) (incorporated by reference to Exhibit 10.48 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2001).
10.55	Pliant Corporation Management Incentive Plan (2002) (incorporated by reference to Exhibit 10.49 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2001).
10.56	Pliant Corporation Management Incentive Plan (2003) (incorporated by reference to Exhibit 10.56 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2003 (filed on March 26, 2004)).
10.57	Pliant Corporation 2002 Stock Incentive Plan (incorporated by reference to Exhibit 10.1 to Pliant Corporation's Quarterly Report on Form 10-Q for the quarter ended September 30, 2002).

II-32

10.58	Consulting Agreement dated as of August 24, 2003, between Pliant corporation and Edward A. Lapekas (incorporated by reference to Exhibit 10.63 to Post-Effective Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-107843).
10.59	Separation Agreement, dated as of September 8, 2003, between Pliant Corporation and Jack E. Knott (incorporated by reference to Exhibit 10.64 to Post-Effective Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-107843).
10.60	Separation Agreement, dated as of September 8, 2003, between Pliant Corporation and Elise H. Scroggs (incorporated by reference to Exhibit 10.65 to Post-Effective Amendment No. 1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-107843).
10.61	Employment Agreement, dated January 1, 2004, between Pliant Corporation and Harold Bevis (incorporated by reference to Exhibit 10.61 to Pliant Corporation Annual Report on Form 10-K for the year ended December 31, 2004).
10.62	Release Agreement, dated December 31, 2004, between Pliant Corporation and Brian Johnson (incorporated by reference to Exhibit 10.62 to Pliant Corporation Annual Report on Form 10-K for the year ended December 31, 2004).
10.63	Letter Agreement, dated January 26, 2005, between Pliant Corporation and James Ide (incorporated by reference to Exhibit 10.63 to Pliant Corporation Annual Report on Form 10-K for the year ended December 31, 2004).
10.64	Severance and Release Agreement, dated as of March 18, 2005, between Pliant Corporation and Lori Roberts (incorporated by reference to Exhibit 10.64 to Pliant Corporation Annual Report on Form 10-K for the year ended December 31, 2004).
10.65	Pliant Corporation 2004 Management Incentive Compensation Plan (incorporated by reference to Exhibit 10.65 to Pliant Corporation Annual Report on Form 10-K for the year ended December 31, 2004).
10.66	Pliant Corporation 2004 MIP Long Term Incentive Plan (incorporated by reference to Exhibit 10.66 to Pliant Corporation Annual Report on Form 10-K for the year ended December 31, 2004).
10.67	Pliant Corporation 2004 Restricted Stock Incentive Plan (incorporated by reference to Exhibit 10.1 to Pliant Corporation's Current Report on Form 8-K filed on September 30, 2004).
10.68	Pliant Corporation 2004 Restricted Stock Incentive Plan Form of Restricted Stock Agreement (incorporated by reference to Exhibit 10.68 to Pliant Corporation Annual Report on Form 10-K for the year ended December 31, 2004).
10.69	Fourth Amendment to the Pliant Corporation Defined Benefit Pension Plan (incorporated by reference to Exhibit 10.69 to Pliant Corporation Annual Report on Form 10-K for the year ended December 31, 2004).
10.70	Buy Out Agreement, dated January 5, 2005, among Pliant Corporation, Pliant Investment, Inc. and Supreme Plastics Group PLC (incorporated by reference to Exhibit 10.70 to Pliant Corporation Annual Report on Form 10-K for the year ended December 31, 2004).
10.71	Assignment of Limited Liability Company Interests, dated January 5, 2005, between Pliant Investment, Inc. and Supreme Plastics Group PLC (incorporated by reference to Exhibit 10.71 to Pliant Corporation Annual Report on Form 10-K for the year ended December 31, 2004).

II-33

10.72	Agreement for Purchase and Sale of Assets, dated July 12, 2004, among Pliant Corporation, Pliant Solutions Corporation and Kittrich Corporation (incorporated by reference to Exhibit 10.1 to Pliant Corporation's Current Report on Form 8-K filed on October 6, 2004).
10.73	Form of Amendment to Credit Agreement (incorporated by reference to Exhibit 10.61 to Pliant Corporation's Current Report on Form 8-K filed on December 23, 2004).
10.74	Pliant Corporation 2005 Management Incentive Compensation Plan (incorporated by reference to Exhibit 10.1 to Pliant Corporation's Current Report on Form 8-K (filed on June 13, 2005)).
10.75	Exhibits to Pliant Corporation 2005 Management Incentive Compensation Plan for R. David Corey Plan (incorporated by reference to Exhibit 10.2 to Pliant Corporation's Current Report on Form 8-K (filed June 13, 2005)).
10.76	Exhibits to Pliant Corporation 2005 Management Incentive Compensation Plan for Paul R. Frantz Plan (incorporated by reference to Exhibit 10.3 to Pliant Corporation's Current Report on Form 8-K (filed June 13, 2005)).
10.77	Exhibits to Pliant Corporation 2005 Management Incentive Compensation Plan for Greg E. Gard Plan (incorporated by reference to Exhibit 10.4 to Pliant Corporation's Current Report on Form 8-K (filed June 13, 2005)).
10.78	Exhibits to Pliant Corporation 2005 Management Incentive Compensation Plan for Kenneth J. Swanson Plan (incorporated by reference to Exhibit 10.5 to Pliant Corporation's Current Report on Form 8-K (filed June 13, 2005) ).
10.79	Employment Agreement, dated June 10, 2005, between Pliant Corporation and R. David Corey (incorporated by reference to Exhibit 10.6 to Pliant Corporation's Current Report on Form 8-K (filed on June 13, 2005)).
10.80	Amended and Restated Indenture, dated as of February 17, 2004 (as amended and restated May 6, 2005) (incorporated by reference to Exhibit 4.26)
10.81	Exchange and Registration Rights Agreement, dated as of May 6, 2005 (incorporated by reference to Exhibit 4.27).
21.1	Subsidiaries of Pliant Corporation (incorporated by reference to Exhibit 21.1 to Pliant Corporation's Annual Report on Form 10-K for the year ended December 31, 2004).
23.1*	Consent of Sonnenschein Nath & Rosenthal LLP (included in Exhibit 5.1).
23.2*	Consent of Stewart McKelvey Stirling Scales (included in Exhibit 5.6).
23.3	Consent of Ernst & Young LLP.
24.1	Powers of Attorney.
25.1	Form T-1 Statement of Eligibility and Qualifications under the Trust Indenture Act of 1939 of The Bank of New York, as Trustee (incorporated by reference to Exhibit 25.1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-42008)).
25.2	Form T-1 Statement of Eligibility and Qualifications under the Trust Indenture Act of 1939 of The Bank of New York, as Trustee (incorporated by reference to Exhibit 25.1 to Pliant Corporation's Registration Statement on Form S-4 (File No. 333-86532)).
25.3*	Form T-1 Statement of Eligibility and Qualifications under the Trust Indenture Act of 1939 of Wilmington Trust Company, as Trustee.

II-34

99.2*	Form of Letter of Transmittal.
99.3*	Form of Notice of Guaranteed Delivery.
99.4*	Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees.
99.5*	Form of Letter to Clients.

*

Previously filed as part of this Registration Statement.

II-35

QuickLinks

TABLE OF CONTENTS
MARKET AND INDUSTRY DATA
WHERE YOU CAN FIND MORE INFORMATION
SUMMARY
Summary of the terms of the Senior Secured Discount Notes
Risk factors
Summary financial data
RISK FACTORS
DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS
USE OF PROCEEDS
CAPITALIZATION
SELECTED FINANCIAL DATA
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
BUSINESS
PROPERTIES
LEGAL PROCEEDINGS
MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
MANAGEMENT
EXECUTIVE COMPENSATION
Aggregated option exercises in last fiscal year and FY-end option values
Long-Term Incentive Plans—Awards in 2004
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
Equity Compensation Plan Information
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
DESCRIPTION OF CREDIT FACILITIES AND OTHER INDEBTEDNESS
DESCRIPTION OF SENIOR SECURED DISCOUNT NOTES
BOOK-ENTRY SETTLEMENT AND CLEARANCE
CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
PLAN OF DISTRIBUTION
LEGAL MATTERS
EXPERTS
INDEX TO FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULE
PLIANT CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS AS OF MARCH 31, 2005 (UNAUDITED) AND DECEMBER 31, 2004 (DOLLARS IN THOUSANDS)
PLIANT CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS For the Three Months Ended March 31, 2005 and 2004 (in Thousands) (Unaudited)
PLIANT CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS For the Three Months Ended March 31, 2005 and 2004 (In Thousands) (Unaudited)
PLIANT CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT For the Three Months Ended March 31, 2005 (In Thousands) (Unaudited)
PLIANT CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
PLIANT CORPORATION AND SUBSIDIARIES Condensed Consolidating Balance Sheet As of March 31, 2005 (In Thousands) (Unaudited)
PLIANT CORPORATION AND SUBSIDIARIES Condensed Consolidating Balance Sheet As of December 31, 2004 (In Thousands) (Unaudited)
PLIANT CORPORATION AND SUBSIDIARIES Condensed Consolidating Income Statement For the Three Months Ended March 31, 2005 (In Thousands) (Unaudited)
PLIANT CORPORATION AND SUBSIDIARIES Condensed Consolidating Income Statement For the Three Months Ended March 31, 2004 (In Thousands) (Unaudited)
PLIANT CORPORATION AND SUBSIDIARIES Condensed Consolidating Statement of Cash Flows For the Three Months Ended March 31, 2005 (In Thousands) (Unaudited)
PLIANT CORPORATION AND SUBSIDIARIES Condensed Consolidating Statement of Cash Flows For the Three Months Ended March 31, 2004 (In Thousands) (Unaudited)
PLIANT CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS As of December 31, 2004 and 2003 (Dollars in Thousands, Except per Share Data)
PLIANT CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS For the Years Ended December 31, 2004, 2003 and 2002 (Dollars in Thousands)
PLIANT CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) For the Years Ended December 31, 2004, 2003 and 2002 (In Thousands)
PLIANT CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) For the Years Ended December 31, 2004, 2003 and 2002 (In Thousands)
PLIANT CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS For the Years Ended December 31, 2004, 2003 and 2002 (Dollars in Thousands)
PLIANT CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
SIGNATURES
SIGNATURES
SIGNATURES
SIGNATURES
SIGNATURES
SIGNATURES
SIGNATURES
SIGNATURES
INDEX TO EXHIBITS

EX-4.26

                                                                    Exhibit 4.26

                                                                 EXECUTION COPY]

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


                               PLIANT CORPORATION

                          Senior Secured Notes due 2009


                                   ----------

                              AMENDED and RESTATED

                                    INDENTURE


                          Dated as of February 17, 2004
                   (as amended and restated as of May 6, 2005)

                                   ----------


                            WILMINGTON TRUST COMPANY,

                                   as Trustee


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



                                TABLE OF CONTENTS



                                                                            Page
                                                                            ----
                                                                             
                                    ARTICLE I

                   Definitions and Incorporation by Reference

SECTION 1.01.   Definitions.........................................................2
SECTION 1.02.   Other Definitions..................................................31
SECTION 1.03.   Incorporation by Reference of Trust Indenture Act..................32
SECTION 1.04.   Rules of Construction..............................................33
SECTION 1.05.   Designated Senior Indebtedness.....................................34


                                   ARTICLE II

                                 The Securities

SECTION 2.01.   Amount of Securities; Issuable in Series...........................34
SECTION 2.02.   Form and Dating....................................................35
SECTION 2.03.   Execution and Authentication.......................................36
SECTION 2.04.   Registrar and Paying Agent.........................................36
SECTION 2.05.   Paying Agent to Hold Money in Trust................................37
SECTION 2.06.   Holder Lists.......................................................37
SECTION 2.07.   Transfer and Exchange..............................................38
SECTION 2.08.   Replacement Securities.............................................39
SECTION 2.09.   Outstanding Securities.............................................39
SECTION 2.10.   Temporary Securities...............................................39
SECTION 2.11.   Cancelation........................................................40
SECTION 2.12.   Defaulted Interest.................................................40
SECTION 2.13.   CUSIP and ISIN Numbers.............................................40
SECTION 2.14.   Issuance of Additional Securities as Payment of Interest...........40

                                   ARTICLE III

                                   Redemption

SECTION 3.01.   Notices to Trustee.................................................41
SECTION 3.02.   Selection of Securities To Be Redeemed.............................41
SECTION 3.03.   Notice of Redemption...............................................42
SECTION 3.04.   Effect of Notice of Redemption.....................................42
SECTION 3.05.   Deposit of Redemption Price........................................43
SECTION 3.06.   Securities Redeemed in Part........................................43




                                                                              ii

                                                                             
                                   ARTICLE IV

                                    Covenants

SECTION 4.01.   Payment of Securities..............................................43
SECTION 4.02.   SEC Reports........................................................44
SECTION 4.03.   Limitation on Indebtedness.........................................44
SECTION 4.04.   Limitation on Restricted Payments..................................48
SECTION 4.05.   Limitation on Restrictions on Distributions from Restricted
                Subsidiaries and Negative Pledges..................................51
SECTION 4.06.   Limitation on Sales of Assets and Subsidiary Stock.................54
SECTION 4.07.   Limitation on Transactions with Affiliates.........................59
SECTION 4.08.   Change of Control..................................................60
SECTION 4.09.   Compliance Certificate.............................................62
SECTION 4.10.   Further Instruments and Acts.......................................62
SECTION 4.11.   Future Note Guarantors and Liens...................................62
SECTION 4.12.   Limitation on Lines of Business....................................64
SECTION 4.13.   Limitation on Liens................................................64
SECTION 4.14.   Material After-Acquired Property...................................65

                                    ARTICLE V

                                Successor Company

SECTION 5.01.   When Company May Merge or Transfer Assets..........................65

                                   ARTICLE VI

                              Defaults and Remedies

SECTION 6.01.   Events of Default..................................................67
SECTION 6.02.   Acceleration.......................................................69
SECTION 6.03.   Other Remedies.....................................................70
SECTION 6.04.   Waiver of Past Defaults............................................70
SECTION 6.05.   Control by Majority................................................70
SECTION 6.06.   Limitation on Suits................................................70
SECTION 6.07.   Rights of Holders to Receive Payment...............................71
SECTION 6.08.   Collection Suit by Trustee.........................................71
SECTION 6.09.   Trustee May File Proofs of Claim...................................71
SECTION 6.10.   Priorities.........................................................71
SECTION 6.11.   Undertaking for Costs..............................................72
SECTION 6.12.   Waiver of Stay or Extension Laws...................................72





                                                                             iii

                                                                             
                                   ARTICLE VII

                                     Trustee

SECTION 7.01.   Duties of Trustee..................................................72
SECTION 7.02.   Rights of Trustee..................................................73
SECTION 7.03.   Individual Rights of Trustee.......................................74
SECTION 7.04.   Trustee's Disclaimer...............................................75
SECTION 7.05.   Notice of Defaults.................................................75
SECTION 7.06.   Reports by Trustee to Holders......................................75
SECTION 7.07.   Compensation and Indemnity.........................................75
SECTION 7.08.   Replacement of Trustee.............................................76
SECTION 7.09.   Successor Trustee by Merger........................................77
SECTION 7.10.   Eligibility; Disqualification......................................77
SECTION 7.11.   Preferential Collection of Claims Against the Company..............78

                                  ARTICLE VIII

                       Discharge of Indenture; Defeasance

SECTION 8.01.   Discharge of Liability on Securities; Defeasance...................78
SECTION 8.02.   Conditions to Defeasance...........................................79
SECTION 8.03.   Application of Trust Money.........................................80
SECTION 8.04.   Repayment to Company...............................................80
SECTION 8.05.   Indemnity for Government Obligations...............................81
SECTION 8.06.   Reinstatement......................................................81

                                   ARTICLE IX

                                   Amendments

SECTION 9.01.   Without Consent of Holders.........................................81
SECTION 9.02.   With Consent of Holders............................................82
SECTION 9.03.   Compliance with Trust Indenture Act................................84
SECTION 9.04.   Revocation and Effect of Consents and Waivers......................84
SECTION 9.05.   Notation on or Exchange of Securities..............................84
SECTION 9.06.   Trustee to Sign Amendments.........................................85

                                    ARTICLE X

                             Collateral and Security

SECTION 10.01.  Security Documents.................................................85
SECTION 10.02.  Recording and Opinions.............................................86
SECTION 10.03.  Release of Collateral..............................................86
SECTION 10.04.  Certificates of the Trustee........................................88





                                                                              iv

                                                                             
SECTION 10.05.  Authorization of Actions to Be Taken by the Trustee Under the
                Security Documents.................................................88
SECTION 10.06.  Authorization of Receipt of Funds by the Trustee Under the
                Security Documents.................................................88
SECTION 10.07.  Termination of Security Interest...................................89
SECTION 10.08.  Collateral Agent...................................................89
SECTION 10.09.  Designations.......................................................90

                                   ARTICLE XI

                                 Note Guarantees

SECTION 11.01.  Note Guarantees....................................................90
SECTION 11.02.  Limitation on Liability............................................93
SECTION 11.03.  Releases of Note Guarantees........................................93
SECTION 11.04.  Successors and Assigns.............................................93
SECTION 11.05.  No Waiver..........................................................94
SECTION 11.06.  Modification.......................................................94
SECTION 11.07.  Execution of Supplemental Indenture for Future Note Guarantors.....94
SECTION 11.08.  Non-Impairment.....................................................94

                                   ARTICLE XII

                                  Miscellaneous

SECTION 12.01.  Trust Indenture Act Controls.......................................94
SECTION 12.02.  Notices............................................................95
SECTION 12.03.  Communication by Holders with Other Holders........................95
SECTION 12.04.  Certificate and Opinion as to Conditions Precedent.................96
SECTION 12.05.  Statements Required in Certificate or Opinion......................96
SECTION 12.06.  When Securities Disregarded........................................96
SECTION 12.07.  Rules by Trustee, Paying Agent and Registrar.......................96
SECTION 12.08.  Legal Holidays.....................................................97
SECTION 12.09.  GOVERNING LAW......................................................97
SECTION 12.10.  No Recourse Against Others.........................................97
SECTION 12.11.  Successors.........................................................97
SECTION 12.12.  Multiple Originals.................................................97
SECTION 12.13.  Table of Contents; Headings........................................97



             
Appendix A   -  Provisions Relating to Original Securities, Additional Securities, Private
                Exchange Notes and Exchange Notes
Exhibit A-1  -  Form of Initial Security and Private Exchange Note - Consenting Security
Exhibit B-1  -  Form of Exchange Note - Consenting Security
Exhibit B-2  -  Form of Exchange Note - Non-Consenting Security
Exhibit C    -  Form of Supplemental Indenture
Exhibit D    -  Form of Transferee Letter of Representation





                    INDENTURE dated as of February 17, 2004, (as amended and
               restated as of May 6, 2005), among PLIANT CORPORATION, a Utah
               corporation (the "Company"), PLIANT CORPORATION INTERNATIONAL, a
               Utah corporation, PLIANT FILM PRODUCTS OF MEXICO, INC., a Utah
               corporation, PLIANT PACKAGING OF CANADA, LLC, a Utah limited
               liability company, UNIPLAST HOLDINGS INC., a Delaware
               corporation, UNIPLAST U.S., INC., a Delaware corporation, and
               UNIPLAST INDUSTRIES CO., a Canadian corporation, (collectively,
               the "Note Guarantors") and WILMINGTON TRUST COMPANY, a Delaware
               banking corporation, as trustee (the "Trustee").

          WHEREAS the Company, the Note Guarantors, Pliant Solutions
Corporation, a Utah corporation, Pierson Industries, Inc., a Massachusetts
corporation, Turex, Inc., a Rhode Island corporation, Uniplast Midwest, Inc., an
Indiana corporation, and the Trustee entered into this indenture as of February
17, 2004 (as so executed, the "Existing Indenture") under which the Company
issued $306,000,000 in aggregate principal amount at maturity of its 11 1/8%
Senior Secured Discount Notes due 2009 (the "Original Securities") on the
Original Issue Date (as defined herein);

          WHEREAS, on June 2, 2004, the Company consummated an exchange offer
pursuant to which it issued $306,000,000 in aggregate principal amount at
maturity of its 11 1/8% Senior Secured Discount Notes due 2009 that had been
registered under the Securities Act of 1933, as amended (the "Securities Act")
(the "Existing Securities") in exchange for all the Original Securities;

          WHEREAS the Company has solicited consents from the Holders of the
Existing Securities to amend certain provisions of the Existing Securities and
the Existing Indenture (the "Amendments");

          WHEREAS the Holders of Existing Securities having an aggregate
principal amount of maturity of $298.2 million consented to the Amendments (such
Existing Securities, as amended by the Amendments, the "Consenting Securities")
and the Holders of the remaining Existing Securities have not consented to the
Amendments (such Existing Securities, the "Non-Consenting Securities");

          WHEREAS, the aggregate principal amount of the Consenting Securities
shall equal the aggregate Accreted Value (as defined herein) as of the Closing
Date of the Existing Securities with respect to which consents to the Amendments
were given and accepted by the Company, which is $250,607,280;

          WHEREAS, the Company, the Note Guarantors and the Trustee agree that
the Existing Indenture is hereby amended and restated in its entirety to reflect
the Amendments, so that, upon this Amended and Restated Indenture becoming
effective, the Existing Indenture shall be amended and restated as provided
herein in its entirety;



                                                                               2

          NOW THEREFORE, each party agrees as follows for the benefit of the
other parties and for the equal and ratable benefit of the Holders of (a) the
Existing Securities, consisting of the Consenting Securities and the
Non-Consenting Securities, (b) any Additional Securities (as defined herein)
that may be issued on any Issue Date (all such Securities in clauses (a) and (b)
being referred to collectively as the "Initial Securities"), (c) if and when
issued as provided in any Registration Agreement (as defined in Appendix A
hereto (the "Appendix")), the Company's Senior Secured Notes due 2009 issued in
a Registered Exchange Offer (as defined in the Appendix) in exchange for any
Initial Securities (the "Exchange Notes") and (d) if and when issued as provided
in a Registration Agreement, the Private Exchange Notes (as defined in the
Appendix; the Private Exchange Notes, together with the Initial Securities and
any Exchange Notes issued hereunder, the "Securities") issued in a Private
Exchange. Subject to the conditions and in compliance with the covenants set
forth herein, the Company may issue an unlimited aggregate principal amount of
Additional Securities from time to time.

                                    ARTICLE I

                   DEFINITIONS AND INCORPORATION BY REFERENCE

          SECTION 1.01.  DEFINITIONS.

          "Accreted Value" as of any date (the "Specified Date") means with
respect to each $1,000 principal amount at maturity of the Non-Consenting
Securities (subject to the latest sentence of this definition):

          (i) if the Specified Date is one of the following dates (each a
     "Semi-Annual Accretion Date"), the amount set forth opposite each date
     below:



SEMI-ANNUAL ACCRETION DATE                                                         ACCRETED VALUE
- --------------------------                                                         --------------
                                                                                
Original Issue Date.............................................................   $       736.27
June 15, 2004...................................................................   $       762.87
December 15, 2004...............................................................   $       805.31
June 15, 2005...................................................................   $       850.10
December 15, 2005...............................................................   $       897.39
June 15, 2006...................................................................   $       947.31
December 15, 2006...............................................................   $     1,000.00


          (ii) if the Specified Date occurs between two Semi-Annual Accretion
     Dates, the sum of (a) the Accreted Value for the Semi-Annual Accretion Date
     immediately preceding the Specified Date and (b) an amount equal to the
     product of (x) the Accreted Value for the immediately following Semi-Annual
     Accretion Date less the Accreted Value of the immediately preceding
     Semi-Annual Accretion Date and (y) the fraction, the numerator of which is
     the number of days actually elapsed from the immediately preceding
     Semi-Annual Accretion Date and the denominator of which is 180; or



                                                                               3

          (iii) if the Specified Date is after December 15, 2006, $1,000.

          For the purposes hereof, if the Specified Date is prior to December
15, 2006 but on or after the date on which the Company elects to commence to pay
cash interest with respect to the Non-Consenting Securities (the "Cash Election
Date"), all references in this document to Accreted Value in respect of any
Non-Consenting Security shall be to the aggregate principal amount of such
Non-Consenting Security, which shall be equal to the Accreted Value of such
Non-Consenting Security as of the Cash Election Date determined in accordance
with clauses (i) and (ii) above. If Additional Interest is payable with respect
to any Non-Consenting Security prior to the earlier of (A) the Cash Election
Date and (B) December 15, 2006, the Accreted Value of such Non-Consenting
Security shall be increased to reflect such Additional Interest.

          "Additional Assets" means (a) any property or assets (other than
Indebtedness and Capital Stock) to be used by the Company or a Restricted
Subsidiary in a Permitted Business or any improvements to any property or assets
that are used by the Company or a Restricted Subsidiary in a Permitted Business;
(b) Capital Stock of a Person that becomes a Restricted Subsidiary as a result
of the acquisition of such Capital Stock by the Company or another Restricted
Subsidiary; or (c) Capital Stock constituting a minority interest in any Person
that at such time is a Restricted Subsidiary; PROVIDED, HOWEVER, that any such
Restricted Subsidiary described in clauses (b) or (c) above is primarily engaged
in a Permitted Business.

          "Additional Interest" means any additional interest or liquidated
damages payable under a Registration Agreement.

          "Additional Securities" means any 11 5/8% Senior Secured Notes due
2009, issued under the terms of this Indenture subsequent to the Closing Date
(other than the Exchange Notes or the Private Exchange Notes issued in exchange
for Consenting Securities or in exchange for Additional Securities issued as
Initial Securities).

          "Affiliate" of any specified Person means any other Person, directly
or indirectly, controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing. For
purposes of Sections 4.06 and 4.07 only, "Affiliate" shall also mean any
beneficial owner of shares representing 10% or more of the total voting power of
the Voting Stock (on a fully diluted basis) of the Company or of rights or
warrants to purchase such Voting Stock (whether or not currently exercisable)
and any Person who would be an Affiliate of any such beneficial owner pursuant
to the first sentence hereof.

          "Asset Disposition" means any sale, lease (other than an operating
lease entered into in the ordinary course of business), transfer or other
disposition (or series of related sales, leases, transfers or dispositions) by
the Company or any Restricted



                                                                               4

Subsidiary, including any disposition by means of a merger, consolidation or
similar transaction (each referred to for the purposes of this definition as a
"disposition"), of (a) any shares of Capital Stock of a Restricted Subsidiary
(other than directors' qualifying shares or shares required by applicable law to
be held by a Person other than the Company or a Restricted Subsidiary), (b) all
or substantially all the assets of any division or line of business of the
Company or any Restricted Subsidiary or (c) any other assets of the Company or
any Restricted Subsidiary outside of the ordinary course of business of the
Company or such Restricted Subsidiary (other than, in the case of (a), (b) and
(c) above, (i) a disposition by a Restricted Subsidiary to the Company or by the
Company or a Restricted Subsidiary to a Wholly Owned Subsidiary, (ii) for
purposes of Section 4.06 only, the making of a Permitted Investment or a
disposition that constitutes a Restricted Payment permitted by Section 4.04,
(iii) sales of accounts receivable and related assets (including contract
rights) of the type specified in the definition of "Qualified Securitization
Transaction" to a Securitization Entity for the fair market value thereof, (iv)
other than with respect to assets that constitute First-Priority Collateral, a
disposition of obsolete or worn out property or equipment or property or
equipment that is no longer used or useful in the conduct of business of the
Company and its Restricted Subsidiaries, (v) any other disposition of assets
with a fair market value, as conclusively determined by senior management of the
Company in good faith, of less than $1.0 million, (vi) sales or grants of
licenses to use the Company's or any Restricted Subsidiary's patents, trade
secrets, know-how and technology to the extent that such license does not
prohibit the licensor from using the patent, trade secret, know-how or
technology or require the licensor to pay any fees for such use, (vii) the
disposition of all or substantially all of the assets of the Company in
compliance with Section 5.01 and (viii) the disposition of any Capital Stock or
other ownership interest in or assets or property of an Unrestricted Subsidiary.

          "Attributable Debt" in respect of a Sale/Leaseback Transaction means,
as at the time of determination, the present value (discounted at the interest
rate borne by the Consenting Securities compounded annually) of the total
obligations of the lessee for rental payments during the remaining term of the
lease included in such Sale/Leaseback Transaction (including any period for
which such lease has been extended).

          "Average Life" means, as of the date of determination, with respect to
any Indebtedness or Preferred Stock, the quotient obtained by dividing (a) the
sum of the products of the numbers of years from the date of determination to
the dates of each successive scheduled principal payment of such Indebtedness or
scheduled redemption or similar payment with respect to such Preferred Stock
multiplied by the amount of such payment by (b) the sum of all such payments.

          "Bank Indebtedness" means any and all amounts payable under or in
respect of the Credit Agreement, including principal, premium (if any), interest
(including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Company or any Subsidiary
whether or not a claim for post-filing interest is allowed in such proceedings),
fees, charges, expenses, reimbursement obligations, guarantees and all other
amounts payable thereunder or in respect thereof.



                                                                               5

          "Board of Directors" means the Board of Directors of the Company or
any committee thereof duly authorized to act on behalf of the Board of Directors
of the Company.

          "Business Day" means each day which is not a Legal Holiday.

          "Canadian Pledge Agreement" means the Pledge Agreement dated as of the
Original Issue Date, among the Company, Uniplast Industries Co. and the
Collateral Agent, as such agreement may be amended, modified, supplemented or
restated from time to time.

          "Canadian Security Agreement" means the Security Agreement dated as of
the Original Issue Date, among the Company, Uniplast Industries Co. and the
Collateral Agent, as such agreement may be amended, modified, supplemented or
restated from time to time.

          "Capitalized Lease Obligations" means an obligation that is required
to be classified and accounted for as a capitalized lease for financial
reporting purposes in accordance with GAAP, and the amount of Indebtedness
represented by such obligation shall be the capitalized amount of such
obligation determined in accordance with GAAP; and the Stated Maturity thereof
shall be the date of the last payment of rent or any other amount due under such
lease prior to the first date upon which such lease may be prepaid by the lessee
without payment of a penalty.

          "Capital Stock" of any Person means any and all shares, interests,
rights to purchase, warrants, options, participations or other equivalents of or
interests in (however designated) equity of such Person, including any Preferred
Stock, but excluding any debt securities convertible into such equity.

          "Change of Control" means the occurrence of any of the following
events:

          (a) prior to the first public offering of common stock of the Company,
     the Permitted Holders cease to be the "beneficial owner" (as defined in
     Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of a
     majority in the aggregate of the total voting power of the Voting Stock of
     the Company, whether as a result of issuance of securities of the Company,
     any merger, consolidation, liquidation or dissolution of the Company, any
     direct or indirect transfer of securities by any Permitted Holder or
     otherwise (for purposes of this clause (a) and clause (b) below, the
     Permitted Holders shall be deemed to beneficially own any Voting Stock of
     an entity (the "specified entity") held by any other entity (the "parent
     entity") so long as the Permitted Holders beneficially own (as so defined),
     directly or indirectly, in the aggregate a majority of the voting power of
     the Voting Stock of the parent entity);

          (b) (i) any "person" (as such term is used in Sections 13(d) and 14(d)
     of the Exchange Act, including any group acting for the purpose of
     acquiring, holding or disposing of securities within the meaning of Rule
     13d-5(b)(1) under the Exchange Act), other than one or more Permitted
     Holders, is or becomes the



                                                                               6

     beneficial owner (as defined in clause (a) above, except that for purposes
     of this clause (b) a person (including a Permitted Holder) shall be deemed
     to have "beneficial ownership" of all shares that any such person has the
     right to acquire, whether such right is exercisable immediately, only after
     the passage of time, upon the happening of any event or otherwise),
     directly or indirectly, of more than 50% of the total voting power of the
     Voting Stock of the Company and (ii) the Permitted Holders "beneficially
     own" (as defined in clause (a) above), directly or indirectly, in the
     aggregate a lesser percentage of the total voting power of the Voting Stock
     of the Company than such other person and do not have the right or ability
     by voting power, contract or otherwise to elect or designate for election a
     majority of the Board of Directors of the Company (for the purposes of this
     clause (b), such other person shall be deemed to beneficially own any
     Voting Stock of a specified entity held by a parent entity, if such other
     person is the beneficial owner (as defined in this clause (b)), directly or
     indirectly, of more than 50% of the voting power of the Voting Stock of
     such parent entity and the Permitted Holders "beneficially own" (as defined
     in clause (a) above), directly or indirectly, in the aggregate a lesser
     percentage of the voting power of the Voting Stock of such parent entity
     and do not have the right or ability by voting power, contract or otherwise
     to elect or designate for election a majority of the Board of Directors of
     such parent entity);

          (c) during any period of two consecutive years, individuals who at the
     beginning of such period constituted the Board of Directors of the Company
     (together with any new directors (i) selected in accordance with the
     Stockholders Agreement so long as such agreement is in effect or otherwise
     nominated by the Permitted Holders or (ii) whose election by the Board of
     Directors of the Company or whose nomination for election by the
     stockholders of the Company was approved by a vote of at least a majority
     of the members of the Board of Directors of the Company, then still in
     office, who were either directors at the beginning of such period or whose
     election or nomination for election was previously so approved by the Board
     of Directors or in accordance with the Stockholders Agreement or otherwise
     by the Permitted Holders) cease for any reason to constitute a majority of
     the Board of Directors of the Company then in office;

          (d) the adoption of a plan relating to the liquidation or
     dissolution of the Company; or

          (e) the merger or consolidation of the Company with or into another
     Person or the merger of another Person with or into the Company, or the
     sale of all or substantially all the assets of the Company to another
     Person (other than a Person that is controlled by the Permitted Holders),
     and, in the case of any such merger or consolidation, the securities of the
     Company that are outstanding immediately prior to such transaction and
     which represent 100% of the aggregate voting power of the Voting Stock of
     the Company are changed into or exchanged for cash, securities or property,
     unless pursuant to such transaction such securities are changed into or
     exchanged for, in addition to any other consideration,



                                                                               7

     securities of the surviving Person or transferee that represent immediately
     after such transaction, at least a majority of the aggregate voting power
     of the Voting Stock of the surviving Person or transferee.

          "Closing Date" means May 6, 2005, the date that the Existing Indenture
is amended and restated hereby.

          "Code" means the Internal Revenue Code of 1986, as amended.

          "Collateral" means the First-Priority Collateral and the
Second-Priority Collateral.

          "Collateral Agent" means the Trustee in its capacity as the
"Collateral Agent" under and as defined in the Security Documents and any
successor thereto in such capacity.

          "Commodity Agreement" means any commodity futures contract, commodity
option or other similar agreement or arrangement entered into by the Company or
any of its Subsidiaries designed to protect the Company or any of its
Subsidiaries against fluctuations in the price of commodities actually at the
time used in the ordinary course of business of the Company or its Subsidiaries.

          "Common Collateral Agent" means a bank or trust company authorized to
exercise corporate trust powers that has been appointed by the Company, and has
agreed, to act as collateral agent for the equal and ratable benefit of both the
holders of obligations secured by the Second-Priority Liens Securing Note
Obligations and the holders of all other obligations secured by Liens Securing
Secondary Collateral Obligations, in its capacity as such collateral agent.

          "Company" means the party named as such in this Indenture until a
successor replaces it and, thereafter, means the successor and, for purposes of
any provision contained herein and required by the TIA, each other obligor on
the indenture securities.

          "Consolidated Coverage Ratio" as of any date of determination means
the ratio of (a) the aggregate amount of EBITDA for the period of the most
recent four consecutive fiscal quarters for which financial statements are
publicly available ending prior to the date of such determination to (b)
Consolidated Interest Expense for such four fiscal quarters; PROVIDED, HOWEVER,
that (i) if the Company or any Restricted Subsidiary has Incurred any
Indebtedness since the beginning of such period that remains outstanding on such
date of determination or if the transaction giving rise to the need to calculate
the Consolidated Coverage Ratio is an Incurrence of Indebtedness, EBITDA and
Consolidated Interest Expense for such period shall be calculated after giving
effect on a pro forma basis to such Indebtedness as if such Indebtedness had
been Incurred on the first day of such period and the discharge of any other
Indebtedness repaid, repurchased, defeased or otherwise discharged with the
proceeds of such new Indebtedness as if such discharge had occurred on the first
day of such period, (ii) if the Company or any Restricted Subsidiary has repaid,
repurchased, defeased or otherwise



                                                                               8

discharged any Indebtedness since the beginning of such period or if any
Indebtedness is to be repaid, repurchased, defeased or otherwise discharged (in
each case other than Indebtedness Incurred under any revolving credit facility
unless such Indebtedness has been permanently repaid and has not been replaced)
on the date of the transaction giving rise to the need to calculate the
Consolidated Coverage Ratio, EBITDA and Consolidated Interest Expense for such
period shall be calculated on a pro forma basis as if such discharge had
occurred on the first day of such period and as if the Company or such
Restricted Subsidiary has not earned the interest income actually earned during
such period in respect of cash or Temporary Cash Investments used to repay,
repurchase, defease or otherwise discharge such Indebtedness, (iii) if since the
beginning of such period the Company or any Restricted Subsidiary shall have
made any Asset Disposition in excess of $10.0 million which constitutes all or
substantially all of an operating unit of a business, the EBITDA for such period
shall be reduced by an amount equal to the EBITDA (if positive) directly
attributable to the assets that are the subject of such Asset Disposition for
such period or increased by an amount equal to the EBITDA (if negative) directly
attributable thereto for such period and Consolidated Interest Expense for such
period shall be reduced by an amount equal to the Consolidated Interest Expense
directly attributable to any Indebtedness of the Company or any Restricted
Subsidiary repaid, repurchased, defeased or otherwise discharged with respect to
the Company and its continuing Restricted Subsidiaries in connection with such
Asset Disposition for such period (or, if the Capital Stock of any Restricted
Subsidiary is sold, the Consolidated Interest Expense for such period directly
attributable to the Indebtedness of such Restricted Subsidiary to the extent the
Company and its continuing Restricted Subsidiaries are no longer liable for such
Indebtedness after such sale), (iv) if since the beginning of such period the
Company or any Restricted Subsidiary (by merger or otherwise) shall have made an
Investment in any Restricted Subsidiary (or any Person that becomes a Restricted
Subsidiary or is merged with and into the Company) or an acquisition of assets,
including any acquisition of assets occurring in connection with a transaction
causing a calculation to be made hereunder, which constitutes all or
substantially all of an operating unit of a business, EBITDA and Consolidated
Interest Expense for such period shall be calculated after giving pro forma
effect thereto (including the Incurrence of any Indebtedness) as if such
Investment or acquisition occurred on the first day of such period and (v) if
since the beginning of such period any Person (that subsequently became a
Restricted Subsidiary or was merged with or into the Company or any Restricted
Subsidiary since the beginning of such period) shall have made any Asset
Disposition or any Investment or acquisition of assets that would have required
an adjustment pursuant to clause (iii) or (iv) above if made by the Company or a
Restricted Subsidiary during such period, EBITDA and Consolidated Interest
Expense for such period shall be calculated after giving pro forma effect
thereto as if such Asset Disposition, Investment or acquisition of assets
occurred on the first day of such period. For purposes of this definition,
whenever pro forma effect is to be given to an Investment or acquisition of
assets, the amount of income or earnings relating thereto and the amount of
Consolidated Interest Expense associated with any Indebtedness Incurred in
connection therewith, the pro forma calculations shall be determined in good
faith by a responsible financial or accounting Officer of the Company. Any such
pro forma calculations may include operating expense reductions for such period
resulting from the



                                                                               9

acquisition which is being given pro forma effect that (a) would be permitted
pursuant to Article 11 of Regulation S-X under the Securities Act or (b) have
been realized or for which the steps necessary for realization have been taken
or are reasonably expected to be taken within six months following any such
acquisition, including, but not limited to, the execution or termination of any
contracts, the termination of any personnel or the closing (or approval by the
Board of Directors of any closing) of any facility, as applicable, PROVIDED
that, such adjustments are set forth in an Officers' Certificate signed by the
Company's chief financial officer and another Officer which states (i) the
amount of such adjustment or adjustments, (ii) that such adjustment or
adjustments are based on the reasonable good faith beliefs of the officers
executing such Officers' Certificate at the time of such execution and (iii)
that any related Incurrence of Indebtedness is permitted pursuant to this
Indenture. If any Indebtedness bears a floating rate of interest and is being
given pro forma effect, the interest expense on such Indebtedness shall be
calculated as if the rate in effect on the date of determination had been the
applicable rate for the entire period (taking into account any Interest Rate
Agreement or Currency Agreement applicable to such Indebtedness if such Interest
Rate Agreement or Currency Agreement has a remaining term as at the date of
determination in excess of 12 months).

          "Consolidated Interest Expense" means, for any period, the total
interest expense of the Company and its Consolidated Restricted Subsidiaries
plus, to the extent Incurred by the Company and its Restricted Subsidiaries in
such period but not included in such interest expense, (a) interest expense
attributable to Capitalized Lease Obligations and the interest expense
attributable to operating leases constituting part of a Sale/Leaseback
Transaction, (b) amortization of debt discount and debt issuance costs, (c)
capitalized interest, (d) non-cash interest expense, (e) commissions, discounts
and other fees and charges attributable to letters of credit and bankers'
acceptance financing, (f) interest accruing on any Indebtedness of any other
Person to the extent such Indebtedness is Guaranteed by the Company or any
Restricted Subsidiary, (g) net costs associated with Hedging Obligations
(including amortization of fees), PROVIDED, HOWEVER, that if Hedging Obligations
result in net benefits rather than costs, such benefits shall be credited in
determining Consolidated Interest Expense unless, pursuant to GAAP, such net
benefits are otherwise reflected in Consolidated Net Income, (h) dividends and
distributions declared in respect of all Disqualified Stock of the Company and
dividends and distributions declared and paid in respect of all Preferred Stock
of any of the Subsidiaries of the Company that is not a Note Guarantor, to the
extent held by Persons other than the Company or a Wholly Owned Subsidiary, (i)
interest Incurred in connection with investments in discontinued operations and
(j) the cash contributions to any employee stock ownership plan or similar trust
to the extent such contributions are used by such plan or trust to pay interest
or fees to any Person (other than the Company) in connection with Indebtedness
Incurred by such plan or trust. Notwithstanding anything to the contrary
contained herein, commissions, discounts, yield and other fees and charges
Incurred in connection with any transaction pursuant to which the Company or any
Subsidiary of the Company may sell, convey or otherwise transfer or grant a
security interest in any accounts receivable or related assets shall be included
in Consolidated Interest Expense.



                                                                              10

          "Consolidated Net Income" means, for any period, the net income (loss)
of the Company and its Consolidated Subsidiaries for such period; PROVIDED,
HOWEVER, that there shall not be included in such Consolidated Net Income:

          (a) any net income (loss) of any Person (other than the Company) if
     such Person is not a Restricted Subsidiary, except that (i) subject to the
     limitations contained in clauses (d), (e) and (f) below, the Company's
     equity in the net income of any such Person for such period shall be
     included in such Consolidated Net Income up to the aggregate amount of cash
     actually distributed by such Person during such period to the Company or a
     Restricted Subsidiary as a dividend or other distribution (subject, in the
     case of a dividend or other distribution made to a Restricted Subsidiary,
     to the limitations contained in clause (c) below) and (ii) the Company's
     equity in a net loss of any such Person for such period shall be included
     in determining such Consolidated Net Income to the extent such loss has
     been funded with cash from the Company or a Restricted Subsidiary;

          (b) other than for purposes of clauses (iv) and (v) of the definition
     of Consolidated Coverage Ratio any net income (or loss) of any Person
     acquired by the Company or a Subsidiary in a pooling of interests
     transaction for any period prior to the date of such acquisition;

          (c) any net income (or loss) of any Restricted Subsidiary if such
     Restricted Subsidiary is subject to restrictions, directly or indirectly,
     on the payment of dividends or the making of distributions or loans or
     intercompany advances by such Restricted Subsidiary, directly or
     indirectly, to the Company, except that (i) subject to the limitations
     contained in clauses (d), (e) and (f) below, the Company's equity in the
     net income of any such Restricted Subsidiary for such period shall be
     included in such Consolidated Net Income up to the aggregate amount of cash
     actually distributed, loaned or advanced by such Restricted Subsidiary
     during such period to the Company or another Restricted Subsidiary as a
     dividend, distribution, loan or advance (subject, in the case of a
     dividend, distribution, loan or advance made to another Restricted
     Subsidiary, to the limitation contained in this clause) and (ii) the
     Company's equity in a net loss of any such Restricted Subsidiary for such
     period shall be included in determining such Consolidated Net Income;

          (d) any gain (loss) realized upon the sale or other disposition of any
     asset of the Company or its Consolidated Subsidiaries (including pursuant
     to any Sale/Leaseback Transaction) that is not sold or otherwise disposed
     of in the ordinary course of business and any gain (loss) realized upon the
     sale or other disposition of any Capital Stock of any Person;

          (e) any extraordinary gain or loss; and

          (f) the cumulative effect of a change in accounting principles.



                                                                              11

          Notwithstanding the foregoing, for the purposes of Section 4.04 only,
there shall be excluded from Consolidated Net Income any dividends, repayments
of loans or advances or other transfers of assets from Unrestricted Subsidiaries
to the Company or a Restricted Subsidiary to the extent such dividends,
repayments or transfers increase the amount of Restricted Payments permitted
under such Section pursuant to clause (a)(iv)(C)(vi) thereof.

          "Consolidation" means the consolidation of the amounts of each of the
Restricted Subsidiaries with those of the Company in accordance with GAAP
consistently applied; PROVIDED, HOWEVER, that "Consolidation" shall not include
consolidation of the accounts of any Unrestricted Subsidiary, but the interest
of the Company or any Restricted Subsidiary in an Unrestricted Subsidiary shall
be accounted for as an investment. The term "Consolidated" has a correlative
meaning.

          "Corporate Trust Office" means the principal office of the Trustee at
which at any time its corporate trust business shall be administered, which
office at the date hereof is located at Rodney Square North, 1100 North Market
Street, Wilmington, DE 19890-0001, Attention: Corporate Trust Administration, or
such other address as the Trustee may designate from time to time by notice to
the Holders and the Issuer, or the principal corporate trust office of any
successor Trustee (or such other address as a successor Trustee may designate
from time to time by notice to the Holders and the Company).

          "Credit Agent" means General Electric Capital Corporation, in its
capacity as collateral agent for the lenders party to the Credit Agreement or
any successor thereto, or any Person otherwise designated the "Credit Agent"
pursuant to the Intercreditor Agreement.

          "Credit Agreement" means the credit agreement dated as of the Original
Issue Date, as amended through the Closing Date, among the Company, Uniplast
Industries Co., the financial institutions party thereto as lenders, Credit
Suisse First Boston, acting through its Cayman Islands Branch, as administrative
agent, General Electric Capital Corporation, as collateral agent, and JPMorgan
Chase Bank, as syndication agent, together with related documents thereto
including any guarantee agreements and security documents, as amended, modified,
supplemented, restated, renewed, refunded, replaced, restructured, repaid or
refinanced from time to time (including any agreement extending the maturity
thereof or increasing the amount of available borrowings thereunder or adding
Restricted Subsidiaries of the Company as additional borrowers or guarantors
thereunder) whether with the original agents and lenders or otherwise and
whether provided under the original credit agreement or other credit agreements
or otherwise.

          "Credit Agreement Obligations" means (i) all Bank Indebtedness and all
other Indebtedness outstanding under one or more of any other First-Lien Credit
Facilities that constitutes Permitted Debt or is otherwise permitted pursuant to
Section 4.03 and that is designated by the Company as "Credit Agreement
Obligations" for purposes of this Indenture and is secured by a Permitted Lien
described in



                                                                              12

clause (a)(2) of the definition thereof, (ii) all other obligations (not
constituting Indebtedness) of the Company or any Note Guarantor under the Credit
Agreement or any such other First-Lien Credit Facility and (iii) all other
obligations of the Company or any Note Guarantor in respect of Hedging
Obligations or obligations in respect of cash management services that are
designated by the Company to be "Credit Agreement Obligations" for purposes of
this Indenture. Notwithstanding anything to the contrary in the previous
sentence, any Indebtedness and other obligations Incurred under the Credit
Agreement or otherwise shall be deemed to constitute Credit Agreement
Obligations if the holders of such Indebtedness or other obligations or their
agent or representative shall have received a written representation from the
Company in, or in connection with, the Credit Agreement or other agreement
governing such Indebtedness or other obligations that such Indebtedness
constitutes, Credit Agreement Obligations (whether or not such Indebtedness is
at any time determined not to have been permitted to be Incurred under this
Indenture).

          "Credit Facilities" means one or more (i) debt facilities (including,
without limitation, the Credit Agreement) or commercial paper facilities,
providing for revolving credit loans, term loans, receivables financing
(including through the sale of receivables to lenders or to special purpose
entities formed to borrow from lenders against such receivables) or letters of
credit, (ii) debt securities, indentures or other forms of debt financing
(including convertible or exchangeable debt instruments) or (iii) instruments or
agreements evidencing any other Indebtedness, in each case, as amended,
supplemented, modified, extended, renewed, restated or refunded in whole or in
part from time to time.

          "Currency Agreement" means with respect to any Person any foreign
exchange contract, currency swap agreements or other similar agreement or
arrangement to which such Person is a party or of which it is a beneficiary.

          "Default" means any event which is, or after notice or passage of time
or both would be, an Event of Default.

          "Discharge of Credit Agreement Obligations" means payment in full in
cash of the principal of and interest and premium, if any, on all Indebtedness
outstanding under the First-Lien Credit Facilities or, with respect to Hedging
Obligations or letters of credit outstanding thereunder, delivery of cash
collateral or backstop letters of credit in respect thereof in compliance with
such First-Lien Credit Facility, in each case after or concurrently with
termination of all commitments to extend credit thereunder, and payment in full
of any other Credit Agreement Obligations that are due and payable or otherwise
accrued and owing at or prior to the time such principal, interest and premium,
if any, are paid.

          "Disqualified Stock" means, with respect to any Person, any Capital
Stock of such Person which by its terms (or by the terms of any security into
which it is convertible or for which it is exchangeable or exercisable) or upon
the happening of any event (a) matures or is mandatorily redeemable pursuant to
a sinking fund obligation or otherwise, (b) is convertible or exchangeable for
Indebtedness or Disqualified Stock (excluding Capital Stock convertible or
exchangeable solely at the option of the



                                                                              13

Company or a Restricted Subsidiary, PROVIDED, that any such conversion or
exchange shall be deemed an issuance of Indebtedness or an issuance of
Disqualified Stock, as applicable) or (c) is redeemable at the option of the
holder thereof, in whole or in part, in the case of clauses (a), (b) and (c), on
or prior to 91 days after the Stated Maturity of the Securities; PROVIDED,
HOWEVER, that only the portion of Capital Stock that so matures or is
mandatorily redeemable, is so convertible or exchangeable or is so redeemable at
the option of the holder thereof prior to such date will be deemed Disqualified
Stock; PROVIDED FURTHER, that any Capital Stock that would not constitute
Disqualified Stock but for provisions thereof giving holders thereof the right
to require such Person to repurchase or redeem such Capital Stock upon the
occurrence of an "asset sale" or "change of control" shall not constitute
Disqualified Stock if the "asset sale" or "change of control" provisions
applicable to such Capital Stock provide that such Person may not repurchase or
redeem such Capital Stock pursuant to such provisions unless such Person has
first complied with the provisions of Sections 4.06 and 4.08, as applicable; and
PROVIDED FURTHER that any class of Capital Stock of such Person that, by its
terms, authorizes such Person to satisfy in full its obligations with respect to
payment of dividends or upon maturity, redemption (pursuant to a sinking fund or
otherwise) or repurchase thereof or other payment obligations or otherwise by
delivery of Capital Stock that is not Disqualified Stock, and that is not
convertible, puttable or exchangeable for Disqualified Stock or Indebtedness,
shall not be deemed Disqualified Stock so long as such Person satisfies its
obligations with respect thereto solely by the delivery of Capital Stock that is
not Disqualified Stock.

          "Domestic Overdraft Facility" means an overdraft line of credit in a
maximum principal amount of $10.0 million at any time outstanding.

          "Domestic Subsidiary" means any Restricted Subsidiary of the Company
other than a Foreign Subsidiary.

          "EBITDA" for any period means the Consolidated Net Income for such
period, excluding the following to the extent included in calculating such
Consolidated Net Income: (a) income tax expense of the Company and its
Consolidated Restricted Subsidiaries, (b) Consolidated Interest Expense, (c)
depreciation expense of the Company and its Consolidated Restricted
Subsidiaries, (d) amortization expense of the Company and its Consolidated
Restricted Subsidiaries (but excluding amortization expense attributable to a
prepaid cash item that was paid in a prior period), (e) other noncash charges of
the Company and its Consolidated Restricted Subsidiaries (excluding any such
noncash charge to the extent that it represents an accrual of or reserve for
cash expenditures in any future period), (f) income or loss from discontinued
operations, (g) plant closing costs (as defined by GAAP) and (h) noncash
stock-based compensation expense. Notwithstanding the foregoing, the provision
for taxes based on the income or profits of, and the depreciation and
amortization and noncash charges of, a Restricted Subsidiary of the Company
shall be added to Consolidated Net Income to compute EBITDA only to the extent
(and in the same proportion) that the net income (loss) of such Restricted
Subsidiary was included in calculating Consolidated Net Income and only if a
corresponding amount would be permitted at the date of determination to be
dividended, loaned or advanced to the Company by such Restricted Subsidiary
without



                                                                              14

prior approval of Persons other than the Board of Directors or holders of the
Company's Capital Stock (that has not been obtained), pursuant to the terms of
its charter and all agreements, instruments, judgments, decrees, orders,
statutes, rules and governmental regulations applicable to such Restricted
Subsidiary or its stockholders.

          "Equity Offering" means any public or private sale of the common stock
of the Company, other than any public offering with respect to the Company's
common stock registered on Form S-8 or other issuances upon exercise of options
by employees of the Company or any of its Restricted Subsidiaries.

          "Exchange Act" means the Securities Exchange Act of 1934, as amended.

          "Exchange Note Guarantees" means the guarantees made by the Note
Guarantors pursuant to a Registration Agreement.

          "Excluded Contribution" means net cash proceeds received by the
Company from (a) contributions to its common equity capital and (b) the sale
(other than to a Subsidiary of the Company or to any Company or Subsidiary
management equity plan or stock option plan or any other management or employee
benefit plan or agreement) of Capital Stock (other than Disqualified Stock) of
the Company, in each case designated as Excluded Contributions pursuant to an
Officers' Certificate executed on the date such capital contributions are made
or the date such Capital Stock is sold, as the case may be, which are excluded
from the calculation set forth in Section 4.04(a)(iv)(3).

          "Existing Management Stockholders" means each of Harold C. Bevis,
R. David Corey, Brian E. Johnson, Len Azzaro and Stanley B. Bikulege.

          "First-Lien Credit Facilities" means (x) the Credit Facilities
provided pursuant to the Credit Agreement and (y) any other Credit Facility
that, in the case of both clauses (x) and (y), is secured by a Permitted Lien
described in clause (a)(2) of the definition thereof and, except for the Credit
Facilities provided pursuant to the senior bank facilities existing on the
Closing Date, is designated by the Company as a "First-Lien Credit Facility" for
the purposes of this Indenture.

          "First-Priority Assets" means real property, fixtures and equipment
(including any leasehold interest therein) and the Other First-Priority Assets.

          "First-Priority Collateral" means any and all of the following assets
and properties now owned or at any time hereafter acquired by the Company or any
Note Guarantor and with respect to which a Lien is granted as security for the
First-Priority Obligations: (a) all First-Priority Assets, (b) the Notes
Collateral Account, (c) all books and records relating to the foregoing and (d)
all Proceeds of any and all of the foregoing.

          "First-Priority Obligations" means the Notes Obligations and the Other
First-Priority Obligations.

          "Foreign Subsidiary" means any Restricted Subsidiary of the Company
organized, and conducting its principal operations, outside the United States of
America.



                                                                              15

          "Foreign Subsidiary Asset Disposition" means any direct or indirect
sale, issuance, conveyance, transfer, lease, assignment or other transfer for
value by the Company or any of its Restricted Subsidiaries (including any
Sale/Leaseback Transaction) to any Person other than the Company or a Restricted
Subsidiary of the Company of the Capital Stock of any Foreign Subsidiary or any
of the property or assets of any Foreign Subsidiary.

          "GAAP" means generally accepted accounting principles in the United
States of America as in effect as of the Original Issue Date, including those
set forth in (a) the opinions and pronouncements of the Accounting Principles
Board of the American Institute of Certified Public Accountants, (b) statements
and pronouncements of the Financial Accounting Standards Board, (c) such other
statements by such other entities as are approved by a significant segment of
the accounting profession, and (d) the rules and regulations of the SEC
governing the inclusion of financial statements (including pro forma financial
statements) in periodic reports required to be filed pursuant to Section 13 of
the Exchange Act, including opinions and pronouncements in staff accounting
bulletins and similar written statements from the accounting staff of the SEC.
All ratios and computations based on GAAP contained in this Indenture shall be
computed in conformity with GAAP.

          "Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness of any other Person
and any obligation, direct or indirect, contingent or otherwise, of such Person
(a) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness of such other Person (whether arising by virtue of
partnership arrangements, or by agreement to keep-well, to purchase assets,
goods, securities or services, to take-or-pay, or to maintain financial
statement conditions or otherwise) or (b) entered into for purposes of assuring
in any other manner the obligee of such Indebtedness of the payment thereof or
to protect such obligee against loss in respect thereof (in whole or in part);
PROVIDED, HOWEVER, that the term "Guarantee" shall not include endorsements for
collection or deposit in the ordinary course of business. The term "Guarantee"
used as a verb has a corresponding meaning. The term "Guarantor" shall mean any
Person Guaranteeing any obligation.

          "Hedging Obligations" of any Person means the obligations of such
Person pursuant to any Commodity Agreement, Interest Rate Agreement or Currency
Agreement.

          "Holder" means the Person in whose name a Security is registered on
the Registrar's books.

          "Incur" means issue, assume, Guarantee, incur or otherwise become
liable for; PROVIDED, HOWEVER, that any Indebtedness or Capital Stock of a
Person existing at the time such Person becomes a Subsidiary (whether by merger,
consolidation, acquisition or otherwise) shall be deemed to be Incurred by such
Person at the time it becomes a Subsidiary. The term "Incurrence" when used as a
noun shall have a correlative meaning.



                                                                              16

          "Indebtedness" means, with respect to any Person on any date of
determination (without duplication):

          (a) the principal of and premium (if any) in respect of
     indebtedness of such Person for borrowed money;

          (b) the principal of and premium (if any) in respect of obligations of
     such Person evidenced by bonds, debentures, notes or other similar
     instruments;

          (c) all obligations of such Person in respect of letters of credit or
     other similar instruments (including reimbursement obligations with respect
     thereto);

          (d) all obligations of such Person to pay the deferred and unpaid
     purchase price of property or services (except Trade Payables and other
     accrued liabilities arising in the ordinary course of business), which
     purchase price is due more than six months after the date of placing such
     property in service or taking delivery and title thereto or the completion
     of such services;

          (e) all Capitalized Lease Obligations and all Attributable Debt of
     such Person;

          (f) all obligations of such Person with respect to the redemption,
     repayment or other repurchase of any Disqualified Stock or, with respect to
     any Subsidiary of such Person that is not a Note Guarantor, any Preferred
     Stock (but excluding, in each case, any accrued dividends);

          (g) all Indebtedness of other Persons secured by a Lien on any asset
     of such Person, whether or not such Indebtedness is assumed by such Person;
     PROVIDED, HOWEVER, that the amount of Indebtedness of such Person shall be
     the lesser of (i) the fair market value of such asset at such date of
     determination and (ii) the amount of such Indebtedness of such other
     Persons;

          (h) to the extent not otherwise included in this definition, the
     net obligations under Hedging Obligations of such Person;

          (i) to the extent not otherwise included, the amount then outstanding
     (I.E., advanced, and received by, and available for use by, such Person)
     under any receivables financing (as set forth in the books and records of
     such Person and confirmed by the agent, trustee or other representative of
     the institution or group providing such receivables financing); and

          (j) all obligations of the type referred to in clauses (a) through (i)
     of other Persons and all dividends of other Persons for the payment of
     which, in either case, such Person is responsible or liable, directly or
     indirectly, as obligor, guarantor or otherwise, including by means of any
     Guarantee.

          Notwithstanding the foregoing, "Indebtedness" shall not include
unsecured indebtedness of the Company and its Restricted Subsidiaries Incurred
to



                                                                              17

finance insurance premiums in a principal amount not in excess of the insurance
premiums to be paid by the Company and its Restricted Subsidiaries for a
three-year period beginning on the date of Incurrence of any such Indebtedness.
The amount of Indebtedness of any Person at any date shall be the outstanding
balance at such date of all unconditional obligations as described above and the
maximum liability, upon the occurrence of the contingency giving rise to the
obligation, of any contingent obligations at such date.

          "Indenture" means this Amended and Restated Indenture as amended or
supplemented from time to time.

          "Indenture Documents" means (a) this Indenture, the Securities and the
Security Documents and (b) any other related document or instrument executed and
delivered pursuant to any Indenture Document described in clause (a) of this
definition evidencing or governing Obligations.

          "Intangible Assets" means goodwill, patents, trademarks and other
intangibles as determined in accordance with GAAP.

          "Intercreditor Agreement" means (a) that certain amended and restated
intercreditor agreement, dated as of the Original Issue Date, by and among the
Company, the Credit Agent, the May 2003 Notes Agent and the Trustee, as amended
(including any amendment and restatement thereof), supplemented or otherwise
modified or replaced from time to time and (b) after the termination of the
Intercreditor Agreement referred to in clause (a) above, any other intercreditor
agreement, with terms no less favorable to the Holders than the Intercreditor
Agreement referred to in clause (a) above, entered into by and among the
Company, a Representative and the Trustee, as amended (including any amendment
and restatement thereof), supplemented or otherwise modified or replaced from
time to time.

          "Interest Rate Agreement" means with respect to any Person any
interest rate protection agreement, interest rate future agreement, interest
rate option agreement, interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate hedge agreement or
other similar agreement or arrangement as to which such Person is party or a
beneficiary.

          "Investment" in any Person means any direct or indirect advance, loan
(other than advances to customers in the ordinary course of business that are
recorded as accounts receivable on the balance sheet of the lender) or other
extension of credit (including by way of Guarantee or similar arrangement) or
capital contribution to (by means of any transfer of cash or other property
(excluding Capital Stock of the Company) to others or any payment for property
or services for the account or use of others), or any purchase or acquisition of
Capital Stock, Indebtedness or other similar instruments issued by such Person.
For purposes of the definition of "Unrestricted Subsidiary" and Section 4.04,
(a) "Investment" shall include the portion (proportionate to the Company's
equity interest in such Subsidiary) of the fair market value of the net assets
of any Subsidiary of the Company at the time that such Subsidiary is designated
an Unrestricted



                                                                              18

Subsidiary; PROVIDED, HOWEVER, that upon a redesignation of such Subsidiary as a
Restricted Subsidiary, the Company shall be deemed to continue to have a
permanent "Investment" in an Unrestricted Subsidiary in an amount (if positive)
equal to (i) the Company's "Investment" in such Subsidiary at the time of such
redesignation less (ii) the portion (proportionate to the Company's equity
interest in such Subsidiary) of the fair market value of the net assets of such
Subsidiary at the time of such redesignation; (b) any property transferred to or
from an Unrestricted Subsidiary shall be valued at its fair market value at the
time of such transfer, in each case as determined in good faith by (x) the
senior management of the Company if the amount thereof is less than $2.0 million
and (y) the Board of Directors if in excess thereof; and (c) the amount of any
Investment shall be the original cost as of the date of determination of such
Investment plus the cost of all additional Investments by the Company or any of
its Restricted Subsidiaries, without any adjustments for increases or decreases
in value or write-ups, write-downs or write-offs with respect to such
Investments.

          "Lien" means any mortgage, pledge, security interest, encumbrance,
lien or charge of any kind (including any conditional sale or other title
retention agreement or lease in the nature thereof).

          "Material After-Acquired Property" means (i) assets acquired by the
Company or any Note Guarantor after the date the Securities are issued which
constitute accretions, additions or technological upgrades to the assets that
form part of the First-Priority Collateral immediately prior to such accretion,
addition or upgrade, (ii) First-Priority Assets of the Company or any Note
Guarantor acquired after the date the Securities are issued (or First-Priority
Assets of any Note Guarantor that is formed or acquired after the date the
Securities are issued) and (iii) any First-Priority Assets acquired by the
Company or any Restricted Subsidiary pursuant to clauses (a)(ii), (a)(iii) and
(a)(iv)(1) of Section 4.06, other than, in the case of clauses (i) and (ii),
assets that are not permitted to be subject to a first-priority security
interest for the benefit of the First-Priority Obligations by the terms of any
encumbrance or restriction described in Section 4.05(d).

          "Material Subsidiary" means, at any date of determination, any
Subsidiary of the Company that, together with its Subsidiaries, (a) for the most
recent fiscal year of the Company accounted for more than 10.0% of the
consolidated revenues of the Company or (b) as of the end of such fiscal year,
was the owner of 10.0% of the consolidated assets of the Company, all as set
forth on the most recently available consolidated financial statement of the
Company and its consolidated Subsidiaries for such fiscal year prepared in
conformity with GAAP.

          "May 2003 Notes" means the $250,000,000 aggregate principal amount of
the Company's 11 1/8% senior secured notes due 2009 issued by the Company on
May 30, 2003, together with any exchange notes issued in respect thereof.

          "May 2003 Notes Agent" means Wilmington Trust Company, in its capacity
as trustee for the holders of the May 2003 Notes or any successor thereto, or
any



                                                                              19

Person designated as the "May 2003 Notes Agent" pursuant to the Intercreditor
Agreement.

          "May 2003 Notes Documents" means the indenture under which the May
2003 Notes were issued, together with related documents thereto, including any
guarantee agreements and security documents, as may be amended, modified,
supplemented, restated or replaced from time to time.

          "May 2003 Notes Obligations" means the Indebtedness evidenced by the
May 2003 Notes, including principal, premium (if any), interest (including
interest accruing on or after the filing of any petition in bankruptcy or for
reorganization relating to the Company whether or not a claim for post-filing
interest is allowed in such proceedings), fees, charges, expenses, reimbursement
obligations, guarantees and all other amounts payable thereunder or in respect
thereof.

          "May 2003 Notes Security Agreement" means the Second Priority Security
Agreement securing the May 2003 Notes, as in effect as of the Closing Date.

          "Mortgaged Property" means, initially as of the Original Issue Date,
the parcels of real property located at the following locations: (i) 299 Clukey
Drive, Harrington, Delaware; (ii) 1330 Lebanon Road, Danville, Kentucky; (iii)
10 Greenfield Road, South Deerfield, Massachusetts; (iv) 1 Edison Drive,
McAlester, Oklahoma; (v) 851 Garrett Parkway, Lewisburg, Tennessee; (vi) 230
Enterprise Drive, Newport News, Virginia; (vii) 8039 South 192nd Street, Kent,
Washington; and (viii) 1701 First Avenue, Chippewa Falls, Wisconsin, and
includes each other parcel of real property and the improvements thereto with
respect to which a Mortgage is granted pursuant to Section 4.11.

          "Mortgages" means a mortgage, deed of trust, assignment of leases and
rents, leasehold mortgage or other security document granting a Lien on any
Mortgaged Property to secure the Obligations.

          "Net Available Cash" from an Asset Disposition means cash payments
received (including any cash payments received by way of deferred payment of
principal pursuant to a note or installment receivable or otherwise and proceeds
from the sale or other disposition of any securities received as consideration,
but only as and when received, but excluding any other consideration received in
the form of assumption by the acquiring Person of Indebtedness or other
obligations relating to the properties or assets that are the subject of such
Asset Disposition or received in any other non-cash form) therefrom, in each
case net of (a) all legal, accounting, investment banking, title and recording
tax expenses, commissions and other fees and expenses incurred, and all Federal,
state, provincial, foreign and local taxes required to be paid or accrued as a
liability under GAAP, as a consequence of such Asset Disposition, (b) all
payments made on any Indebtedness which is secured by any assets subject to such
Asset Disposition, in accordance with the terms of any Lien upon or other
security agreement of any kind with respect to such assets, or which must by its
terms, or in order to obtain a necessary consent to such Asset Disposition, or
by applicable law be repaid out of the proceeds



                                                                              20

from such Asset Disposition, (c) all distributions and other payments required
to be made to minority interest holders in Subsidiaries or joint ventures as a
result of such Asset Disposition, (d) the decrease in proceeds from Qualified
Securitization Transactions which results from such Asset Disposition and (e)
appropriate amounts to be provided by the seller as a reserve, in accordance
with GAAP, against any liabilities associated with the property or other assets
disposed of in such Asset Disposition and retained by the Company or any
Restricted Subsidiary after such Asset Disposition.

          "Net Cash Proceeds", with respect to any issuance or sale of Capital
Stock, means the cash proceeds of such issuance or sale net of attorneys' fees,
accountants' fees, underwriters' or placement agents' fees, discounts or
commissions and brokerage, consultant and other fees and expenses actually
incurred in connection with such issuance or sale and net of taxes paid or
payable as a result thereof.

          "Note Guarantee" means each Guarantee of the obligations with respect
to the Securities issued by a Person pursuant to the terms of this Indenture.

          "Note Guarantor" means any Person that has issued a Note Guarantee.

          "Notes Collateral Account" means an account maintained by the Company
in the name of the Trustee with any financial institution reasonably designated
by the Trustee into which Net Cash Proceeds in respect of the First-Priority
Collateral is required to be deposited pursuant to this Indenture or the
Security Documents.

          "Notes Obligations" means the Indebtedness evidenced by the
Securities, including Accreted Value or principal, premium (if any), interest
(including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Company whether or not a claim
for post-filing interest is allowed in such proceedings), fees, charges,
expenses, reimbursement obligations, guarantees and all other amounts payable
thereunder or in respect thereof.

          "Obligations" means all obligations of the Company and the Note
Guarantors under this Indenture, the Securities and the other Indenture
Documents, including obligations to the Trustee and the Collateral Agent,
whether for payment of principal of, and interest, including Additional
Interest, if any, on, the Securities and all other monetary obligations of the
Company and the Note Guarantors under this Indenture, the Securities and the
other Indenture Documents, whether for fees, expenses, indemnification or
otherwise.

          "Officer" means the Chairman of the Board, the Chief Executive
Officer, the Chief Financial Officer, the President, any Vice President, the
Treasurer, the Secretary or any Assistant Secretary of the Company.

          "Officers' Certificate" means a certificate signed by two Officers.

          "Opinion of Counsel" means a written opinion from legal counsel who is
acceptable to the Trustee. The counsel may be an employee of or counsel to the
Company.



                                                                              21

          "Original Issue Date" means February 17, 2004.

          "Other First-Priority Assets" means intellectual property and all
other types of property in which a security interest is granted pursuant to the
May 2003 Notes Security Agreement, other than the Second-Priority Collateral.

          "Other First-Priority Obligations" means any Refinancing Indebtedness
in respect of the Securities that is designated by the Company as "Other
First-Priority Obligations" for purposes of this Indenture, including principal,
premium (if any), interest (including interest accruing on or after the filing
of any petition in bankruptcy or for reorganization relating to the Company or
any Note Guarantor whether or not a claim for post-filing interest is allowed in
such proceedings), fees, charges, expenses, reimbursement obligations,
guarantees and all other amounts payable thereunder or in respect thereof;
PROVIDED, HOWEVER, that if such Refinancing Indebtedness contains or otherwise
has the benefit of provisions effectively requiring that proceeds from sales or
transfers of property or assets by the Company or any Subsidiary of the Company
be applied to repay, redeem or retire, or offer to repay, redeem or retire, such
Refinancing Indebtedness, the terms thereof shall be no more favorable to the
holders of such Refinancing Indebtedness than those set forth in this Indenture
for the benefit of the Holders.

          "Permitted Business" means the design, manufacture and/or marketing of
films and flexible packaging products for food, personal care, medical, retail,
agricultural, industrial and other applications or any businesses that are
reasonably related, ancillary or complementary thereto.

          "Permitted Holders" means each of (i) J.P. Morgan Partners, LLC and
its Affiliates, (ii) Southwest Industrial Films, LLC and its Affiliates, (iii)
the Christena Karen H. Durham Trust, (iv) the Existing Management Stockholders
and their Related Parties and (v) any Person acting in the capacity of an
underwriter in connection with a public or private offering of the Company's
Capital Stock

          "Permitted Investment" means an Investment by the Company or any
Restricted Subsidiary in: (a) the Company, a Restricted Subsidiary or a Person
that will, upon the making of such Investment, become a Restricted Subsidiary;
PROVIDED, HOWEVER, that after giving effect to such Investment the Company is
still in compliance with Section 4.12; (b) another Person if as a result of such
Investment such other Person is merged or consolidated with or into, or
transfers or conveys all or substantially all its assets to, the Company or a
Restricted Subsidiary; PROVIDED, HOWEVER, that after giving effect to such
Investment the Company is still in compliance with Section 4.12; (c) Temporary
Cash Investments; (d) receivables owing to the Company or any Restricted
Subsidiary if created or acquired in the ordinary course of business and payable
or dischargeable in accordance with customary trade terms; PROVIDED, HOWEVER,
that such trade terms may include such concessionary trade terms as the Company
or any such Restricted Subsidiary deems reasonable under the circumstances; (e)
payroll, travel and similar advances or loans to cover matters that are expected
at the time of such advances ultimately to be treated as expenses for accounting
purposes and that are made



                                                                              22

in the ordinary course of business; (f) loans or advances to officers,
directors, consultants or employees made (A) in the ordinary course of business
and not exceeding $3.0 million in any year or (B) to fund purchases of stock
under the Company's 2000 Stock Incentive Plan, the 2002 Stock Incentive Plan and
any similar plans or employment arrangements; (g) Capital Stock, obligations or
other securities received in settlement of debts created in the ordinary course
of business and owing to the Company or any Restricted Subsidiary or in
satisfaction of judgments or pursuant to any plan of reorganization or similar
arrangement upon the bankruptcy or insolvency of a debtor; (h) any Person to the
extent such Investment represents the non-cash portion of the consideration
received for an Asset Disposition that was made pursuant to and in compliance
with Section 4.06; (i) any Investment by the Company or a Restricted Subsidiary
in a Securitization Entity or any Investment by a Securitization Entity in any
other Person in connection with a Qualified Securitization Transaction; PROVIDED
that any Investment in a Securitization Entity is in the form of a purchase
money note or an equity interest; (j) Hedging Obligations entered into in the
ordinary course of business; (k) endorsements of negotiable instruments and
documents in the ordinary course of business; (l) assets or securities of a
Person acquired by the Company or a Restricted Subsidiary to the extent the
consideration for such acquisition consists of Capital Stock (other than
Disqualified Stock) of the Company; (m) Investments in existence on the Closing
Date; (n) Investments of a Person or any of its Subsidiaries existing at the
time such Person becomes a Restricted Subsidiary of the Company or at the time
such Person merges or consolidates with the Company or any of its Restricted
Subsidiaries, in either case in compliance with this Indenture; PROVIDED that
such Investments were not made by such Person in connection with, or in
anticipation or contemplation of, such Person becoming a Restricted Subsidiary
of the Company or such merger or consolidation; (o) Investments in Unrestricted
Subsidiaries or joint ventures not to exceed $30.0 million since the Original
Issue Date plus (A) the aggregate net after-tax amount returned since the
Original Issue Date to the Company or any Restricted Subsidiary in cash on or
with respect to any Investments made since the Original Issue Date in
Unrestricted Subsidiaries and joint ventures whether through interest payments,
principal payments, dividends or other distributions or payments (including such
dividends, distributions or payments made concurrently with such Investment),
(B) the net after-tax cash proceeds received since the Original Issue Date by
the Company or any Restricted Subsidiary from the disposition of all or any
portion of such Investments (other than to the Company or a Subsidiary of the
Company), and (C) upon redesignation since the Original Issue Date of an
Unrestricted Subsidiary as a Restricted Subsidiary, the fair market value of
such Subsidiary, PROVIDED that any amounts included pursuant to the foregoing
clauses (A), (B) and (C) are excluded from the calculation set forth in clause
(a)(iv)(3) under Section 4.04; and (p) additional Investments since the Original
Issue Date in an aggregate amount not to exceed $15.0 million.

          "Permitted Liens" means: (a) Liens upon (1) any First-Priority
Collateral securing any Indebtedness permitted to be incurred under Section 4.03
and all other obligations of the Company or any Restricted Subsidiary in respect
of such Indebtedness not constituting Indebtedness; PROVIDED that, (x) unless
the Indebtedness secured by such Lien constitutes Other First-Priority
Obligations, such Lien does not rank prior to or PARI PASSU with the Liens on
the First-Priority Collateral in favor of the Securities and (y) the holder of
such Lien (i) becomes party to the Intercreditor Agreement, or agrees to be



                                                                              23

bound by the terms of the Intercreditor Agreement, and (ii) agrees to have the
obligations of the Company and the Note Guarantors that are secured by the
property subject to such Lien treated as Second-Priority Obligations thereunder;
and (2) any Second-Priority Collateral securing any Indebtedness permitted to be
incurred under Section 4.03 and all other obligations of the Company or any
Restricted Subsidiary in respect of such Indebtedness not constituting
Indebtedness; (b) Liens securing the Securities (including any Additional
Securities and any Exchange Notes) and the Note Guarantees thereof; (c) Liens in
favor of the Company or any Restricted Subsidiary; (d) Liens on property of a
Person existing at the time such Person is merged with or into or consolidated
with or acquired by the Company or any Restricted Subsidiary; (e) Liens on
property existing at the time of acquisition of the property by the Company or
any Restricted Subsidiary; (f) Liens to secure Indebtedness (including
Capitalized Lease Obligations) permitted by Section 4.03(b) (vi) covering only
the property, equipment or other assets acquired with such Indebtedness or
additions or improvements to such assets; (g) Liens for taxes, assessments or
governmental charges or claims that are not yet delinquent or that are being
contested in good faith by appropriate proceedings promptly instituted and
diligently concluded; PROVIDED that any reserve or other appropriate provision
as is required in conformity with GAAP has been made therefor; (h) Liens
incurred in the ordinary course of business, including, without limitation,
judgment and attachment liens of the Company or any Restricted Subsidiary of the
Company with respect to obligations that do not exceed in the aggregate $25.0
million at any one time outstanding and that are not incurred in connection with
the borrowing of money or the obtaining of advances of credit (other than trade
credit in the ordinary course of business, not evidenced by a note and not past
due); (i) Liens in favor of the Trustee, the trustee under the Senior
Subordinated Notes Indentures, the warrant agent under the warrant agreement
dated as of May 31, 2000 entered into by the Company and any other trustee or
warrant agent acting in such capacity with respect to one or more future
indentures or agreements so long as the related Indebtedness is permitted to be
Incurred under Section 4.03; (j) Liens incurred in connection with Refinancing
Indebtedness, but only if such Liens extend to no more assets than the Liens
securing the Indebtedness being refinanced; PROVIDED that no Liens may be
incurred pursuant to this clause (j) in respect of First-Priority Collateral,
except to the extent the Liens on such First-Priority Collateral are incurred in
connection with Refinancing Indebtedness that Refinanced Indebtedness that was
secured by Permitted Liens described under clauses (d), (e) or (f) of this
definition; (k) Liens securing Hedging Obligations; (l) statutory Liens of
landlords and carriers', warehousemen's, mechanics', suppliers', materialmen's,
repairmen's, or other like Liens (including contractual landlords liens) arising
in the ordinary course of business and with respect to amounts not yet
delinquent by more than 60 days or being contested in good faith by appropriate
proceedings, if a reserve or other appropriate provision, if any, as shall be
required in conformity with GAAP shall have been made therefor; (m) Liens
incurred and deposits made in the ordinary course of business in connection with
workers' compensation, unemployment insurance and other types of social
security; (n) Liens to secure Indebtedness of any Foreign Subsidiary (other than
Liens described by clause (a)(1) of this definition); (o) licenses, sublicenses,
subleases, easements, zoning restrictions, rights-of-way, restrictions, minor
defects or irregularities in title and other similar charges or encumbrances not
interfering in any material respect with the business



                                                                              24

of the Company or any of its Restricted Subsidiaries; (p) Liens on specific
items of inventory or other goods and proceeds thereof of any Person securing
such Person's obligations in respect of bankers' acceptances issued or created
for the account of such Person to facilitate the purchase, shipment or storage
of such inventory or other goods; (q) Liens securing reimbursement obligations
with respect to commercial letters of credit which encumber documents and the
property relating to such letters of credit and products and proceeds thereof;
(r) any interest or title of a lessor in the property subject to any lease or
arising from filing Uniform Commercial Code financing statements regarding
leases; (s) judgment liens in respect of judgments that do not constitute an
Event of Default; (t) Liens existing on the Closing Date; (u) Liens incurred or
deposits made to secure the performance of bids, trade contracts, leases,
statutory obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature, in each case in the ordinary course of business;
(v) ground leases in respect of real property on which facilities owned or
leased by the Company or any of its Restricted Subsidiaries are located; (w)
Liens in favor of customs and revenue authorities arising as a matter of law to
secure payment of customs duties in connection with the importation of goods;
(x) leases or subleases granted to other Persons and not interfering in any
material respect with the business of the Company and its Restricted
Subsidiaries, taken as a whole; (y) Liens in connection with a Qualified
Securitization Transaction incurred in compliance with Section 4.03(b) (ix) ;
(z) Liens arising solely by virtue of any statutory or common law provision
relating to banker's liens, rights of setoff or similar rights; and (aa) Liens
securing insurance premium financing arrangements which are otherwise excluded
from the definition of Indebtedness.

          "Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.

          "Pledge Agreement" means the Pledge Agreement dated as of the Original
Issue Date, among the Company, the Subsidiary Pledgors (as defined therein) and
the Collateral Agent, as such agreement may be amended, modified, supplemented
or restated from time to time.

          "Preferred Stock", as applied to the Capital Stock of any Person,
means Capital Stock of any class or classes (however designated) that is
preferred as to the payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution of such Person,
over Capital Stock of any other class of such Person.

          "principal" of a Security means the principal of the Security plus the
premium, if any, payable on the Security which is due or overdue or is to become
due at the relevant time.

          "Proceeds" shall have the meaning assigned to such term in the Uniform
Commercial Code.



                                                                              25

          "Public Market" means any time after (a) an Equity Offering has been
consummated and (b) at least 15% of the total issued and outstanding common
stock of the Company has been distributed by means of an effective registration
statement under the Securities Act.

          "Qualified Securitization Transaction" means any transaction or series
of transactions that may be entered into by the Company or any of its
Subsidiaries pursuant to which the Company or any of its Subsidiaries may sell,
convey or otherwise transfer pursuant to customary terms to (a) a Securitization
Entity (in the case of a transfer by the Company or any of its Subsidiaries) and
(b) any other Person (in the case of a transfer by a Securitization Entity), or
may grant a security interest in any accounts receivable (whether now existing
or arising or acquired in the future) of the Company or any of its Subsidiaries,
and any assets related thereto including, without limitation, all collateral
securing such accounts receivable, all contracts and contract rights and all
guarantees or other obligations in respect of such accounts receivable, proceeds
of such accounts receivable and other assets (including contract rights) which
are customarily transferred or in respect of which security interests are
customarily granted in connection with asset securitization transactions
involving accounts receivable.

          "Qualified Stock" means any Capital Stock that is not Disqualified
Stock.

          "Refinance" means, in respect of any Indebtedness, to refinance,
extend, renew, refund, repay, prepay, redeem, defease or retire, or to issue
other Indebtedness in exchange or replacement for, such Indebtedness.
"Refinanced" and "Refinancing" shall have correlative meanings.

          "Refinancing Indebtedness" means Indebtedness that is Incurred to
Refinance any Indebtedness of the Company or any Restricted Subsidiary existing
on the Closing Date or Incurred in compliance with this Indenture (including
Indebtedness of the Company or a Restricted Subsidiary that Refinances
Refinancing Indebtedness); PROVIDED, HOWEVER, that: (a) the Refinancing
Indebtedness has a Stated Maturity no earlier than the Stated Maturity of the
Indebtedness being Refinanced, (b) the Refinancing Indebtedness has an Average
Life at the time such Refinancing Indebtedness is Incurred that is equal to or
greater than the Average Life of the Indebtedness being refinanced, (c) such
Refinancing Indebtedness is Incurred in an aggregate principal amount (or if
issued with original issue discount, an aggregate issue price) (whether in U.S.
dollars or a foreign currency) that is equal to or less than the aggregate
principal amount (or if issued with original issue discount, the aggregate
accreted value) (in U.S. dollars or such foreign currency, as applicable) then
outstanding (plus, without duplication, accrued interest, premium and defeasance
costs required to be paid under the terms of the Indebtedness being Refinanced
and the fees, expenses, discounts, commissions and other issuance costs incurred
in connection with the Refinancing Indebtedness) of the Indebtedness being
Refinanced, and (d) if the Indebtedness being Refinanced is subordinated in
right of payment to the Securities or a Note Guarantee of a Note Guarantor, such
Refinancing Indebtedness is subordinated in right of payment to the Securities
or the Note Guarantee at least to the same extent as the Indebtedness being
Refinanced; PROVIDED FURTHER, HOWEVER, that Refinancing Indebtedness shall not
include:



                                                                              26

(i) Indebtedness of a Restricted Subsidiary that is not a Note Guarantor that
Refinances Indebtedness of the Company or (ii) Indebtedness of the Company or a
Restricted Subsidiary that Refinances Indebtedness of an Unrestricted
Subsidiary.

          "Related Parties" means with respect to a Person (a) that is a natural
person (1) any spouse, parent or lineal descendant (including adopted children)
of such Person or (2) the estate of such Person during any period in which such
estate holds Capital Stock of the Company for the benefit of any person referred
to in clause (a)(1) and (b) any trust, corporation, partnership, limited
liability company or other entity, the beneficiaries, stockholders, partners,
owners or Persons beneficially owning an interest of more than 50% of which
consist of such Person and/or such other Persons referred to in the immediately
preceding clause (a).

          "Representative" means the trustee, agent or representative (if any)
for an issue of Senior Indebtedness.

          "Restricted Investment" means any Investment other than a Permitted
Investment.

          "Restricted Subsidiary" means any Subsidiary of the Company other than
an Unrestricted Subsidiary.

          "Sale/Leaseback Transaction" means an arrangement relating to property
now owned or hereafter acquired by the Company or a Restricted Subsidiary
whereby the Company or a Restricted Subsidiary transfers such property to a
Person and the Company or such Restricted Subsidiary leases it from such Person,
other than (a) leases between the Company and a Wholly Owned Subsidiary or
between Wholly Owned Subsidiaries or (b) any arrangement whereby the transfer
involves fixed or capital assets and is consummated within 120 days after the
date the Company or a Restricted Subsidiary acquires or finishes construction of
such fixed or capital assets.

          "SEC" means the Securities and Exchange Commission.

          "Secondary Collateral Obligations" means the May 2003 Notes
Obligations and any other Indebtedness of the Company and the Restricted
Subsidiaries (other than the First-Priority Obligations and the Credit Agreement
Obligations) that is secured by a Permitted Lien described in clause (a)(2) of
the definition thereof and is designated by the Company as a "Secondary
Collateral Obligation" for purposes of this Indenture.

          "Second-Priority Collateral" means any and all of the following assets
and properties now owned or at any time hereafter acquired by the Company or any
Note Guarantor and with respect to which a Lien is granted as security for the
Credit Agreement Obligations or any Secondary Collateral Obligations:
receivables, inventory (and Indebtedness arising from loans and advances made to
enable the obligors to acquire inventory), payment intangibles (other than
payment intangibles that represent tax refunds in respect of, or otherwise
relate to, real property, fixtures, equipment or intellectual property), 100% of
the capital stock of, or other equity interests in, existing



                                                                              27

and future Domestic Subsidiaries and Foreign Subsidiaries that are Note
Guarantors (subject to the limitation set forth in the Pledge Agreement), and
65% of the capital stock or other equity interests in, existing and future
first-tier Foreign Subsidiaries (other than Foreign Subsidiaries that are Note
Guarantors) (subject to the limitation set forth in the Pledge Agreement),
credit card proceeds, investment property, other financial assets, instruments,
deposit, securities and commodity accounts (and the cash and other assets
contained therein), hedging, commodity and other derivative contracts (and cash
and other deposits securing the same), all permits and licenses related to the
foregoing (other than permits and licenses related to the ownership or operation
of real property, fixtures, equipment or intellectual property), all books and
records relating to the foregoing, all general intangibles, chattel paper,
instruments and documents to the extent evidencing, governing, securing or
otherwise related to the foregoing and all products and proceeds of the
foregoing in whatever form received, including proceeds of insurance policies
related to the foregoing (including proceeds of business interruption insurance
to the extent related to the first 45 days of the covered period for any
business interruption), but excluding the Notes Collateral Account (and any cash
or other assets held therein in accordance with this Indenture or the Security
Documents).

          "Second-Priority Obligations" means Indebtedness of the Company and
the Restricted Subsidiaries (other than the First-Priority Obligations)
including principal, premium (if any), interest (including interest accruing on
or after the filing of any petition in bankruptcy or for reorganization relating
to the Company or any Note Guarantor whether or not a claim for post-filing
interest is allowed in such proceedings), fees, charges, expenses, reimbursement
obligations, guarantees and all other amounts payable thereunder or in respect
thereof that is secured by a security interest in the First-Priority Collateral
by a Permitted Lien described in clause (a)(1) of the definition thereof.

          "Security Agreement" means the Security Agreement dated as of the
Original Issue Date, among the Company, the Guarantors (as defined therein) and
the Collateral Agent, as such agreement may be amended, modified, supplemented
or restated from time to time.

          "Security Documents" means the Pledge Agreement, the Canadian Pledge
Agreement, the Security Agreement, the Canadian Security Agreement, the
Mortgages and any other document or instrument pursuant to which a Lien is
granted by the Company or any Note Guarantor to secure any Obligations or under
which rights or remedies with respect to such Lien are governed, as such
agreements may be amended, modified, supplemented or restated from time to time.

          "Securitization Entity" means a Wholly Owned Subsidiary of the Company
(or another Person in which the Company or any Subsidiary of the Company makes
an Investment and to which the Company or any Subsidiary of the Company
transfers accounts receivable and related assets) which engages in no activities
other than in connection with the financing of accounts receivable and which is
designated by the Board of Directors of the Company (as provided below) as a
Securitization Entity (a) no portion of the Indebtedness or any other
obligations (contingent or otherwise) of which (i) is guaranteed by the Company
or any Subsidiary of the Company (excluding



                                                                              28

guarantees of obligations (other than the principal of, and interest on,
Indebtedness) pursuant to Standard Securitization Undertakings), (ii) is
recourse to or obligates the Company or any Subsidiary of the Company in any way
other than pursuant to Standard Securitization Undertakings or (iii) subjects
any property or asset of the Company or any Subsidiary of the Company, directly
or indirectly, contingently or otherwise, to the satisfaction thereof, other
than pursuant to Standard Securitization Undertakings, (b) with which neither
the Company nor any Subsidiary of the Company has any material contract,
agreement, arrangement or understanding other than on terms no less favorable to
the Company or such Subsidiary than those that might be obtained at the time
from Persons that are not Affiliates of the Company, other than fees payable in
the ordinary course of business in connection with servicing receivables of such
entity and (c) to which neither the Company nor any Subsidiary of the Company
has any obligation to maintain or preserve such entity's financial condition or
cause such entity to achieve certain levels of operating results. Any such
designation by the Board of Directors of the Company shall be evidenced to the
Trustee, by filing with the Trustee a certified copy of the resolution of the
Board of Directors giving effect to such designation and an Officers'
Certificate certifying that such designation complied with the foregoing
conditions.

          "Senior Indebtedness" of the Company or any Note Guarantor, as the
case may be, means the principal of, premium (if any) and accrued and unpaid
interest on (including interest accruing on or after the filing of any petition
in bankruptcy or for reorganization of the Company or any Note Guarantor, as
applicable, regardless of whether or not a claim for post-filing interest is
allowed in such proceedings), and fees and other amounts owing in respect of,
Bank Indebtedness, the Securities (in the case of the Company), the Note
Guarantees (in the case of the Note Guarantors), Other First-Priority
Obligations and all other Indebtedness of the Company or any Note Guarantor, as
applicable, whether outstanding on the Closing Date or thereafter Incurred,
unless in the instrument creating or evidencing the same or pursuant to which
the same is outstanding it is provided that such obligations are subordinated in
right of payment to the Securities or such Note Guarantor's Note Guarantee.

          "Senior Subordinated Notes" of the Company means the $220,000,000
aggregate principal amount of the Company's 13% senior subordinated notes due
2010 issued by the Company on May 31, 2000 and the $100,000,000 aggregate
principal amount of the Company's 13% senior subordinated notes due 2010 issued
by the Company on April 10, 2002, in each case together with the exchange notes
issued in respect thereof, in such case, to the extent outstanding.

          "Senior Subordinated Notes Indentures" means the indentures dated as
of May 31, 2000, and April 10, 2002, among the Company, the subsidiary
guarantors party thereto and The Bank of New York, as trustee, under which the
Company's Senior Subordinated Notes were issued, each as amended, modified or
supplemented from time to time.

           "Significant Subsidiary" means any Restricted Subsidiary that would
be a "Significant Subsidiary" of the Company within the meaning of Rule 1-02
under Regulation S-X promulgated by the SEC.



                                                                              29

          "Standard Securitization Undertakings" means representations,
warranties, covenants and indemnities entered into by the Company or any
Subsidiary of the Company which are reasonably customary in an accounts
receivable securitization transaction.

          "Stated Maturity" means, with respect to any security, the date
specified in such security as the fixed date on which the final payment of
principal of such security is due and payable, including pursuant to any
mandatory redemption provision (but excluding any provision providing for the
repurchase of such security at the option of the holder thereof upon the
happening of any contingency beyond the control of the issuer unless such
contingency has occurred).

          "Stockholders Agreement" means the Stockholders Agreement among the
Company and the holders of the Company's Capital Stock party thereto, as in
effect on the Closing Date and as amended from time to time, so long as the
Permitted Holders own a majority of the Capital Stock subject to such agreement.

          "Subordinated Obligation" means any Indebtedness of the Company
(whether outstanding on the Closing Date or thereafter Incurred) that is
subordinate or junior in right of payment to the Securities pursuant to a
written agreement. "Subordinated Obligation" of a Note Guarantor has a
correlative meaning.

          "Subsidiary" of any Person means any corporation, association,
partnership, limited liability company or other business entity of which more
than 50% of the total voting power of shares of Capital Stock or other interests
(including partnership interests) entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, representatives, managers
or trustees thereof is at the time owned or controlled, directly or indirectly,
by (a) such Person, (b) such Person and one or more Subsidiaries of such Person
or (c) one or more Subsidiaries of such Person.

          "Tangible Assets" means Total Assets less Intangible Assets.

          "Temporary Cash Investments" means any of the following: (a) any
investment in direct obligations of the United States of America or any agency
or instrumentality thereof or obligations Guaranteed or insured by the United
States of America or any agency or instrumentality thereof, (b) investments in
checking accounts, savings accounts, time deposit accounts, certificates of
deposit, bankers' acceptances and money market deposits maturing within 360 days
of the date of acquisition thereof issued by a bank or trust company that is
organized under the laws of the United States of America, any state thereof or
any foreign country recognized by the United States of America having capital,
surplus and undivided profits aggregating in excess of $250,000,000 (or the
foreign currency equivalent thereof) and whose long-term debt is rated "A" (or
such similar equivalent rating) or higher by at least one nationally recognized
statistical rating organization (as defined in Rule 436 under the Securities
Act), (c) repurchase obligations with a term of not more than 30 days for
underlying securities of the types described in clause (a) above entered into
with a bank meeting the qualifications described in clause (b) above, (d)
investments in commercial paper,



                                                                              30

maturing not more than 270 days after the date of acquisition, issued by a
corporation (other than an Affiliate of the Company) organized and in existence
under the laws of the United States of America or any foreign country recognized
by the United States of America with a rating at the time as of which any
investment therein is made of "P-1" (or higher) according to Moody's Investors
Service, Inc. or "A-1" (or higher) according to Standard and Poor's Ratings
Service, a division of The McGraw-Hill Companies, Inc. ("S&P"), (e) investments
in securities with maturities of six months or less from the date of acquisition
issued or fully guaranteed by any state, commonwealth or territory of the United
States of America, or by any political subdivision or taxing authority thereof,
and rated at least "A" by S&P or "A" by Moody's Investors Service, Inc. and (f)
investments in money market funds that invest substantially all of their assets
in securities of the types described in clauses (a) through (e) above.

          "TIA" means the Trust Indenture Act of 1939 (15 U.S.C. Sections
77aaa-77bbbb) as amended from time to time.

          "Total Assets" means the total consolidated assets of the Company and
its Restricted Subsidiaries, as shown on the most recent balance sheet of the
Company.

          "Trade Payables" means, with respect to any Person, any accounts
payable or any indebtedness or monetary obligation to trade creditors created,
assumed or Guaranteed by such Person arising in the ordinary course of business
in connection with the acquisition of goods or services.

          "Trustee" means the party named as such in this Indenture until a
successor replaces it and, thereafter, means the successor.

          "Trust Officer" means the Chairman of the Board, the President or any
other officer or assistant officer of the Trustee assigned by the Trustee to
administer its corporate trust matters.

          "Uniform Commercial Code" means the New York Uniform Commercial Code
as in effect from time to time.

          "Unrestricted Subsidiary" means (a) Pliant Investment, Inc. and any
Subsidiary of the Company that at the time of determination shall be designated
an Unrestricted Subsidiary by the Board of Directors in the manner provided
below and (b) any Subsidiary of an Unrestricted Subsidiary. The Board of
Directors may designate any Subsidiary of the Company (including any newly
acquired or newly formed Subsidiary of the Company) to be an Unrestricted
Subsidiary unless such Subsidiary or any of its Subsidiaries owns any Capital
Stock in or Indebtedness of, or owns or holds any Lien on any property of, the
Company or any other Subsidiary of the Company that is not a Subsidiary of the
Subsidiary to be so designated; PROVIDED, HOWEVER, that either (i) the
Subsidiary to be so designated at the time of designation has total Consolidated
assets of $1,000 or less or (ii) if such Subsidiary has Consolidated assets
greater than $1,000, then such designation would be permitted under Section
4.04. The Board of Directors may designate any Unrestricted Subsidiary to be a
Restricted Subsidiary;



                                                                              31

PROVIDED, HOWEVER, that immediately after giving effect to such designation (a)
the Company could Incur $1.00 of additional Indebtedness under Section 4.03(a)
and (b) no Default shall have occurred and be continuing. Any such designation
of a Subsidiary as a Restricted Subsidiary or Unrestricted Subsidiary by the
Board of Directors shall be evidenced to the Trustee by promptly filing with the
Trustee a copy of the resolution of the Board of Directors giving effect to such
designation and an Officers' Certificate certifying that such designation
complied with the foregoing provisions.

          "U.S. Government Obligations" means direct obligations (or
certificates representing an ownership interest in such obligations) of the
United States of America (including any agency or instrumentality thereof) for
the payment of which the full faith and credit of the United States of America
is pledged and which are not callable or redeemable at the issuer's option.

          "Voting Stock" of a Person means all classes of Capital Stock or other
interests (including partnership interests) of such Person then outstanding and
normally entitled (without regard to the occurrence of any contingency) to vote
in the election of directors, managers or trustees thereof.

          "Wholly Owned Subsidiary" means a Restricted Subsidiary of the Company
all the Capital Stock of which (other than directors' qualifying Capital Stock)
is owned by the Company or another Wholly Owned Subsidiary.

          SECTION 1.02.  OTHER DEFINITIONS.



                                                            Defined in
Term                                                         Section
- ----                                                       ------------
                                                        
"Affiliate Transaction".................................   4.07(a)
"Amendments"............................................   Preamble
"Appendix"..............................................   Preamble
"Bankruptcy Law"........................................   6.01
"Cash Election Date"....................................   1.01
"Change of Control Offer"...............................   4.08(b)
"Consenting Securities".................................   Preamble
"covenant defeasance option"............................   8.01(b)
"Custodian".............................................   6.01
"Definitive Securities".................................   Appendix A
"Event of Default"......................................   6.01
"Existing Indenture"....................................   Preamble
"Existing Securities"...................................   Preamble
"Global Securities".....................................   Appendix A
"Guaranteed Obligations"................................   11.01(a)
"incorporated provision"................................   12.01
"Initial Securities"....................................   Preamble
"Issue Date"............................................   Appendix A
"legal defeasance option"...............................   8.01(b)




                                                                              32



                                                            Defined in
Term                                                         Section
- ----                                                       ------------
                                                        
"Legal Holiday".........................................   12.08
"Liens Securing Secondary Collateral Obligations".......   10.08(d)
"Non-Consenting Securities".............................   Preamble
"Notice of Default".....................................   6.01
"Offer".................................................   4.06(c)
"Offer Amount"..........................................   4.06(d) (ii)
"Offer Period"..........................................   4.06(d) (ii)
"Original Securities"...................................   Preamble
"Paying Agent"..........................................   2.04(a)
"Permitted Debt"........................................   4.03(b)
"Private Exchange"......................................   Appendix A
"Private Exchange Notes"................................   Appendix A
"protected purchaser"...................................   2.08
"Purchase Date".........................................   4.06(d) (i)
"Registration Agreement"................................   Appendix A
"Registered Exchange Offer".............................   Appendix A
"Registrar".............................................   2.04(a)
"Restricted Payment"....................................   4.04(a)
"Second-Priority Liens Securing Note Obligations".......   10.08(d)
"Securities"............................................   Preamble
"Securities Act"........................................   Preamble
"Securities Custodian"..................................   Appendix A
"Semi-Annual Accretion Date"............................   1.01
"Specified Date"........................................   1.01
"Successor Company".....................................   5.01(a) (i)
"Transfer Restricted Securities"........................   Appendix A


          SECTION 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT. This
Indenture is subject to the mandatory provisions of the TIA, which are
incorporated by reference in and made a part of this Indenture. The following
TIA terms have the following meanings:

          "Commission" means the SEC.

          "indenture securities" means the Securities and the Note Guarantees.

          "indenture security holder" means a Holder.

          "indenture to be qualified" means this Indenture.

          "indenture trustee" or "institutional trustee" means the Trustee.

          "obligor" on the indenture securities means the Company, the Note
Guarantors and any other obligor on the indenture securities.



                                                                              33

          All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule have the
meanings assigned to them by such definitions.

          SECTION 1.04. RULES OF CONSTRUCTION. Unless the context otherwise
requires:

          (a) a term has the meaning assigned to it;

          (b) an accounting term not otherwise defined has the meaning assigned
     to it in accordance with GAAP;

          (c) "or" is not exclusive;

          (d) "including" means including without limitation;

          (e) words in the singular include the plural and words in the plural
     include the singular;

          (f) unsecured Indebtedness shall not be deemed to be subordinate or
     junior to Secured Indebtedness merely by virtue of its nature as unsecured
     Indebtedness;

          (g) the principal amount of any noninterest bearing or other discount
     security at any date shall be the principal amount thereof that would be
     shown on a balance sheet of the issuer dated such date prepared in
     accordance with GAAP;

          (h) the principal amount of any Preferred Stock shall be (i) the
     maximum liquidation value of such Preferred Stock or (ii) the maximum
     mandatory redemption or mandatory repurchase price (not including, in
     either case, any redemption or repurchase premium) with respect to such
     Preferred Stock, whichever is greater;

          (i) all references in this Indenture, in any context, to Accreted
     Value or any interest or other amount payable on or with respect to the
     Securities shall be defined to include any Additional Interest pursuant to
     a Registration Agreement, and such adjustments shall be made to the
     Accreted Value of any Security as is necessary to reflect the foregoing;

          (j) references to "principal amount" of any Security shall mean
     "principal amount at maturity" with respect to any Non-Consenting Security;
     PROVIDED that for purposes of calculations in matters where the Consenting
     Securities and the Non-Consenting Securities vote, consent or otherwise act
     together as one class, including for purposes of Sections 6.01, 6.02, 6.04,
     6.05, 6.06 and 9.02, "principal amount" of any Security shall mean
     "Accreted Value" with respect to any Non-Consenting Security; and



                                                                              34

          (k) unless specifically indicated otherwise, the terms of this
     Indenture shall apply to all Securities issued hereunder.

          SECTION 1.05. DESIGNATED SENIOR INDEBTEDNESS. For purposes of the
Senior Subordinated Notes Indentures, the Securities and the Note Guarantees
shall constitute Designated Senior Indebtedness (as such term is defined in the
Senior Subordinated Notes Indentures) of the Company and the Note Guarantors, as
the case may be.

                                   ARTICLE II

                                 THE SECURITIES

          SECTION 2.01. AMOUNT OF SECURITIES; ISSUABLE IN SERIES. The aggregate
principal amount of Securities that may be authenticated and delivered under
this Indenture is unlimited. The Securities may be issued in one or more series.
All Securities of any one series shall be substantially identical except as to
denomination.

          With respect to any Additional Securities issued after the Closing
Date (except for Securities authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, other Securities pursuant to
Sections 2.07, 2.08, 2.09, 2.10 or 3.06 or the Appendix), there shall be (a)
established in or pursuant to a resolution of the Board of Directors and (b) set
forth or determined in the manner provided in an Officers' Certificate prior to
the issuance of such Additional Securities:

          (1) whether such Additional Securities shall be issued as part of a
new or existing series of Securities and the title of such Additional Securities
(which shall distinguish the Additional Securities of the series from Securities
of any other series);

          (2) the aggregate principal amount of such Additional Securities which
may be authenticated and delivered under this Indenture, which may be in an
unlimited aggregate principal amount;

          (3) the issue price and issuance date of such Additional Securities,
including the date from which interest on such Additional Securities shall
accrue; PROVIDED, HOWEVER, that Additional Securities may be issued only if they
are fungible with the other Securities issued under this Indenture for U.S.
federal income tax purposes;

          (4) if applicable, that such Additional Securities shall be issuable
in whole or in part in the form of one or more Global Securities and, in such
case, the respective depositaries for such Global Securities, the form of any
legend or legends which shall be borne by such Global Securities in addition to
or in lieu of those set forth in Exhibit A-1 hereto and any circumstances in
addition to or in lieu of those set forth in Section 2.03 of the Appendix in
which any such Global Security may be exchanged in whole or in part for
Additional Securities registered, or any transfer of such Global



                                                                              35

Security in whole or in part may be registered, in the name or names of Persons
other than the depositary for such Global Security or a nominee thereof; and

          (5) if applicable, that such Additional Securities shall not be issued
in the form of Initial Securities as set forth in Exhibit A-1, but shall be
issued in the form of Exchange Notes as set forth in Exhibit B-1.

          If any of the terms of any Additional Securities are established by
action taken pursuant to a resolution of the Board of Directors, a copy of an
appropriate record of such action shall be certified by the Secretary or any
Assistant Secretary of the Company and delivered to the Trustee at or prior to
the delivery of the Officers' Certificate or the indenture supplemental hereto
setting forth the terms of the Additional Securities.

          Notwithstanding the foregoing, Additional Securities may be issued as
payment of interest on the Consenting Securities from time to time in accordance
with the terms of the Consenting Securities.

          SECTION 2.02. FORM AND DATING. Provisions relating to the Existing
Securities (consisting of the Consenting Securities and the Non-Consenting
Securities), the Additional Securities, the Private Exchange Notes and the
Exchange Notes are set forth in the Appendix, which is hereby incorporated in
and expressly made a part of this Indenture. The (a) Consenting Securities and
the Trustee's certificate of authentication, (b) Private Exchange Notes and the
Trustee's certificate of authentication and (c) Additional Securities (if issued
as Transfer Restricted Securities), if any, and the Trustee's certificate of
authentication shall each be substantially in the form of Exhibit A-1 hereto,
which is hereby incorporated in and expressly made a part of this Indenture. The
Exchange Notes and the Additional Securities issued other than as Transfer
Restricted Securities, if any, and the Trustee's certificate of authentication
and the Non-Consenting Notes and the Trustee's certificate of authentication
shall each be substantially in the form of Exhibit B-1 or B-2, hereto, as
applicable, both of which are hereby incorporated in and expressly made a part
of this Indenture. The Securities may have notations, legends or endorsements
required by law, stock exchange rule, agreements to which the Company or any
Note Guarantor is subject, if any, or usage (provided that any such notation,
legend or endorsement is in a form acceptable to the Company). Each Security
shall be dated the date of its authentication. The Securities shall be issuable
only in registered form without interest coupons and only in denominations of
$1,000 principal amount and integral multiples thereof; provided that (x) the
aggregate principal amount of the Consenting Securities shall equal the
aggregate Accreted Value as of the Closing Date of the Existing Securities with
respect to which consents to the Amendments were given and accepted by the
Company, which is $250,607,280 and (y) the aggregate principal amount of the
Exchange Notes and Private Exchange Notes issued in exchange for any Consenting
Securities shall equal the aggregate principal amount of such Consenting
Securities; provided further that Additional Securities issued as payment of
interest, including Additional Interest, if any, on the Consenting Securities,
the Exchange Notes and the Private Exchange Notes shall be issued in
denominations of $0.01 and integral multiples of $0.01.



                                                                              36

          Except as otherwise specified herein, the Initial Securities, the
Private Exchange Notes and the Exchange Notes shall vote and consent together on
all matters (as to which any of the Securities may vote or consent) as one class
and shall be treated as a single class of Securities issued under this
Indenture.

          SECTION 2.03. EXECUTION AND AUTHENTICATION. Two Officers shall sign
the Securities for the Company by manual or facsimile signature.

          If an Officer whose signature is on a Security no longer holds that
office at the time the Trustee authenticates the Security, the Security shall be
valid nevertheless.

          A Security shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security. The
signature shall be conclusive evidence that the Security has been authenticated
under this Indenture.

          The Trustee shall authenticate and make available for delivery
Securities as set forth in the Appendix.

          The Trustee may appoint an authenticating agent reasonably acceptable
to the Company to authenticate the Securities. Any such appointment shall be
evidenced by an instrument signed by a Trust Officer, a copy of which shall be
furnished to the Company. Unless limited by the terms of such appointment, an
authenticating agent may authenticate Securities whenever the Trustee may do so.
Each reference in this Indenture to authentication by the Trustee includes
authentication by such agent. An authenticating agent has the same rights as any
Registrar, Paying Agent or agent for service of notices and demands.

          SECTION 2.04. REGISTRAR AND PAYING AGENT. (a) The Company shall
maintain an office or agency where Securities may be presented for registration
of transfer or for exchange (the "Registrar") and an office or agency where
Securities may be presented for payment (the "Paying Agent"). The Registrar
shall keep a register of the Securities and of their transfer and exchange. The
Company may have one or more co-registrars and one or more additional paying
agents. The term "Paying Agent" includes any additional paying agent, and the
term "Registrar" includes any co-registrars. The Company initially appoints the
Trustee as (i) Registrar and Paying Agent in connection with the Securities and
(ii) the Securities Custodian with respect to the Global Securities.

          (b) The Company shall enter into an appropriate agency agreement with
any Registrar or Paying Agent not a party to this Indenture, which shall
incorporate the terms of the TIA. The agreement shall implement the provisions
of this Indenture that relate to such agent. The Company shall notify the
Trustee of the name and address of any such agent. If the Company fails to
maintain a Registrar or Paying Agent, the Trustee shall act as such and shall be
entitled to appropriate compensation therefor pursuant to Section 7.07. The
Company or any of its domestically organized Wholly Owned Subsidiaries may act
as Paying Agent or Registrar.



                                                                              37

          (c) The Company may remove any Registrar or Paying Agent upon written
notice to such Registrar or Paying Agent and to the Trustee; PROVIDED, HOWEVER,
that no such removal shall become effective until (i) acceptance of an
appointment by a successor as evidenced by an appropriate agreement entered into
by the Company and such successor Registrar or Paying Agent, as the case may be,
and delivered to the Trustee or (ii) notification to the Trustee that the
Trustee shall serve as Registrar or Paying Agent until the appointment of a
successor in accordance with clause (i) above. The Registrar or Paying Agent may
resign at any time upon written notice to the Company and the Trustee.

          SECTION 2.05. PAYING AGENT TO HOLD MONEY IN TRUST. Prior to each due
date of the principal of and interest, including Additional Interest, if any, on
any Security, the Company shall deposit with the Paying Agent (or if the Company
or a Wholly Owned Subsidiary is acting as Paying Agent, segregate and hold in
trust for the benefit of the Persons entitled thereto) a sum sufficient to pay
such principal and interest, including Additional Interest, if any, when so
becoming due. The Company shall require each Paying Agent (other than the
Trustee) to agree in writing that the Paying Agent shall hold in trust for the
benefit of Holders or the Trustee all money held by the Paying Agent for the
payment of principal of and interest, including Additional Interest, if any, on
the Securities, and shall notify the Trustee of any default by the Company in
making any such payment. If the Company or a Subsidiary of the Company acts as
Paying Agent, it shall segregate the money held by it as Paying Agent and hold
it as a separate trust fund. The Company at any time may require a Paying Agent
to pay all money held by it to the Trustee and to account for any funds
disbursed by the Paying Agent. Upon complying with this Section, the Paying
Agent shall have no further liability for the money delivered to the Trustee.

          SECTION 2.06. HOLDER LISTS. The Trustee shall preserve in as current a
form as is reasonably practicable the most recent list available to it of the
names and addresses of Holders. If the Trustee is not the Registrar, the Company
shall furnish, or cause the Registrar to furnish, to the Trustee, in writing at
least five Business Days before each interest payment date and at such other
times as the Trustee may request in writing, a list in such form and as of such
date as the Trustee may reasonably require of the names and addresses of
Holders.

          SECTION 2.07. TRANSFER AND EXCHANGE. The Securities shall be issued in
registered form and shall be transferable only upon the surrender of a Security
for registration of transfer and in compliance with the Appendix. When a
Security is presented to the Registrar with a request to register a transfer,
the Registrar shall register the transfer as requested if its requirements
therefor are met. When Securities are presented to the Registrar with a request
to exchange them for an equal principal amount of Securities of other
denominations, the Registrar shall make the exchange as requested if the same
requirements are met. To permit registration of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate Securities at the
Registrar's request. The Company may require payment of a sum sufficient to pay
all taxes, assessments or other governmental charges in connection with any
transfer or exchange pursuant to this Section. The Company shall not be required
to make and the Registrar



                                                                              38

need not register transfers or exchanges of Securities selected for redemption
(except, in the case of Securities to be redeemed in part, the portion thereof
not to be redeemed) or any Securities for a period of 15 days before a selection
of Securities to be redeemed.

          Prior to the due presentation for registration of transfer of any
Security, the Company, the Note Guarantors, the Trustee, the Paying Agent, and
the Registrar may deem and treat the Person in whose name a Security is
registered as the absolute owner of such Security for the purpose of receiving
payment of principal of and (subject to paragraph 2 of the Securities) interest,
if any, on such Security and for all other purposes whatsoever, whether or not
such Security is overdue, and none of the Company, any Note Guarantor, the
Trustee, the Paying Agent, or the Registrar shall be affected by notice to the
contrary.

          Any Holder of a Global Security shall, by acceptance of such Global
Security, agree that transfers of beneficial interest in such Global Security
may be effected only through a book-entry system maintained by (a) the Holder of
such Global Security (or its agent) or (b) any Holder of a beneficial interest
in such Global Security, and that ownership of a beneficial interest in such
Global Security shall be required to be reflected in a book entry.

          All Securities issued upon any transfer or exchange pursuant to the
terms of this Indenture shall evidence the same debt and shall be entitled to
the same benefits under this Indenture as the Securities surrendered upon such
transfer or exchange.

          The Trustee shall have no obligation or duty to monitor, determine or
inquire as to compliance with any restrictions on transfer imposed under this
Indenture or under applicable law with respect to any transfer of any interest
in any Security (including any transfers between or among Depositary
Participants or beneficial owners of interests in any Global Security) other
than to require delivery of such certificates and other documentation or
evidence as are expressly required by, and to do so if and when expressly
required by the terms of, this Indenture, and to examine the same to determine
substantial compliance as to form with the express requirements hereof.

          SECTION 2.08. REPLACEMENT SECURITIES. If a mutilated Security is
surrendered to the Registrar or if the Holder of a Security claims that the
Security has been lost, destroyed or wrongfully taken, the Company shall issue
and the Trustee shall authenticate a replacement Security if the requirements of
Section 8-405 of the Uniform Commercial Code are met, such that the Holder (a)
satisfies the Company or the Trustee within a reasonable time after such Holder
has notice of such loss, destruction or wrongful taking and the Registrar does
not register a transfer prior to receiving such notification, (b) makes such
request to the Company or the Trustee prior to the Security being acquired by a
protected purchaser as defined in Section 8-303 of the Uniform Commercial Code
(a "protected purchaser") and (c) satisfies any other reasonable requirements of
the Trustee. If required by the Trustee or the Company, such Holder shall
furnish an indemnity bond sufficient in the judgment of the Trustee to protect
the Company, the Trustee, the Paying Agent and the Registrar from any loss that
any of them may suffer if a Security is replaced. The Company and the Trustee
may charge the



                                                                              39

Holder for their expenses in replacing a Security. In the event any such
mutilated, lost, destroyed or wrongfully taken Security has become or is about
to become due and payable, the Company in its discretion may pay such Security
instead of issuing a new Security in replacement thereof.

          Every replacement Security is an additional obligation of the Company.

          The provisions of this Section 2.08 are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, lost, destroyed or wrongfully taken
Securities.

          SECTION 2.09. OUTSTANDING SECURITIES. Securities outstanding at any
time are all Securities authenticated by the Trustee except for those canceled
by it, those delivered to it for cancelation and those described in this Section
as not outstanding. Subject to Section 12.06, a Security does not cease to be
outstanding because the Company or an Affiliate of the Company holds the
Security.

          If a Security is replaced pursuant to Section 2.08, it ceases to be
outstanding unless the Trustee and the Company receive proof satisfactory to
them that the replaced Security is held by a protected purchaser.

          If the Paying Agent segregates and holds in trust, in accordance with
this Indenture, on a redemption date or maturity date money sufficient to pay
all principal and interest, including Additional Interest, if any, payable on
that date with respect to the Securities (or portions thereof) to be redeemed or
maturing, as the case may be, then on and after that date such Securities (or
portions thereof) cease to be outstanding and interest or accretion, as
applicable, on them ceases to accrue or accrete, as applicable.

          SECTION 2.10. TEMPORARY SECURITIES. In the event that Definitive
Securities are to be issued under the terms of this Indenture, until such
Definitive Securities are ready for delivery, the Company may prepare and the
Trustee shall authenticate temporary Securities. Temporary Securities shall be
substantially in the form of Definitive Securities but may have variations that
the Company considers appropriate for temporary Securities. Without unreasonable
delay, the Company shall prepare and the Trustee shall authenticate Definitive
Securities and deliver them in exchange for temporary Securities upon surrender
of such temporary Securities at the office or agency of the Company, without
charge to the Holder.

          SECTION 2.11. CANCELATION. The Company at any time may deliver
Securities to the Trustee for cancelation. The Registrar and the Paying Agent
shall forward to the Trustee any Securities surrendered to them for registration
of transfer, exchange or payment. The Trustee and no one else shall cancel all
Securities surrendered for registration of transfer, exchange, payment or
cancelation and shall dispose of canceled Securities in accordance with its
customary procedures or deliver canceled Securities to the Company pursuant to
written direction by an Officer. The Company may not issue new Securities to
replace Securities it has redeemed, paid or delivered to



                                                                              40

the Trustee for cancelation. The Trustee shall not authenticate Securities in
place of canceled Securities other than pursuant to the terms of this Indenture.

          SECTION 2.12. DEFAULTED INTEREST. If the Company defaults in a payment
of interest on the Securities, the Company shall pay the defaulted interest
(plus interest on such defaulted interest to the extent lawful) in any lawful
manner. The Company may pay the defaulted interest to the Persons who are
Holders on a subsequent special record date. The Company shall fix or cause to
be fixed any such special record date and payment date to the reasonable
satisfaction of the Trustee and shall promptly mail or cause to be mailed to
each Holder a notice that states the special record date, the payment date and
the amount of defaulted interest to be paid.

          SECTION 2.13. CUSIP AND ISIN NUMBERS. The Company in issuing the
Securities may use "CUSIP" and "ISIN" numbers (if then generally in use) and, if
so, the Trustee shall use "CUSIP" and "ISIN" numbers in notices of redemption as
a convenience to Holders; PROVIDED, HOWEVER, that any such notice may state that
no representation is made as to the correctness of such numbers either as
printed on the Securities or as contained in any notice of a redemption and that
reliance may be placed only on the other identification numbers printed on the
Securities, and any such redemption shall not be affected by any defect in or
omission of such numbers. The Company shall promptly notify the Trustee of any
change in the CUSIP number.

          SECTION 2.14. ISSUANCE OF ADDITIONAL SECURITIES AS PAYMENT OF
INTEREST. The Company shall be entitled to issue Additional Securities under
this Indenture as payment of interest, including Additional Interest, if any, on
the Consenting Securities, the Exchange Notes and the Private Exchange Notes, as
applicable, which shall have identical terms as the underlying securities. The
Consenting Securities issued on the Closing Date and any Additional Securities
issued as payment of interest, including Additional Interest, if any, on the
Consenting Securities shall be treated as a single class for all purposes under
this Indenture.

          With respect to any such Additional Securities, the Company shall
deliver to the Trustee and the Paying Agent no later than two Business Days
prior to the relevant interest payment date, (i) with respect to Consenting
Securities, Exchange Notes and Private Exchange Notes that are in global form,
an order to increase the principal amount of such Global Securities by the
relevant amount (or, if requested by the Trustee or the Holder of such Global
Securities, to authenticate a new Global Security executed by the Company with
such increased principal amounts) or (ii) with respect to Consenting Securities,
Exchange Notes and Private Exchange Notes that are in definitive form, the
required amount of new definitive Additional Securities and an order to
authenticate and deliver such Additional Securities to the registered Holder of
the definitive Consenting Securities, Exchange Notes or Private Exchange Notes,
as applicable.

          Any such Additional Securities shall, after being executed and
authenticated pursuant to Section 2.03, be (i) deposited into the account
specified by the Holder or Holders thereof as of the relevant record date if the
Consenting Securities, Exchange Notes or Private Exchange Notes are held in
global form or otherwise



                                                                              41

according to the procedures of the Depositary or (ii) mailed to the person
entitled thereto as shown on the register for the definitive Consenting
Securities, Exchange Notes or Private Exchange Notes as of the relevant record
date. Alternatively, the Company may direct the Paying Agent to make the
appropriate amendments to the schedule of principal amounts of the relevant
Consenting Securities outstanding and arrange for deposit into the account
specified by the Holder or Holders thereof as of the relevant record date.
Payment shall be made in such form and upon such terms as specified herein and
the Company shall and Paying Agent may take additional steps as is necessary to
effect such payment.

                                   ARTICLE III

                                   REDEMPTION

          SECTION 3.01. NOTICES TO TRUSTEE. If the Company elects to redeem
Securities pursuant to paragraph 5 of the Securities, it shall notify the
Trustee in writing of the redemption date and the principal amount of Securities
to be redeemed.

          The Company shall give each notice to the Trustee provided for in this
Section at least 60 days before the redemption date unless the Trustee consents
to a shorter period. Such notice shall be accompanied by an Officers'
Certificate from the Company to the effect that such redemption will comply with
the conditions herein. Any such notice may be canceled at any time prior to
notice of such redemption being mailed to any Holder and shall thereby be void
and of no effect.

          SECTION 3.02. SELECTION OF SECURITIES TO BE REDEEMED. If fewer than
all the Securities are to be redeemed, the Trustee shall select the Securities
to be redeemed pro rata or by lot or by a method that the Trustee in its sole
discretion shall deem to be fair and appropriate. The Trustee shall make the
selection from outstanding Securities not previously called for redemption. The
Trustee may select for redemption portions of the principal amount of Securities
that have denominations larger than $1,000 of principal amount. Securities and
portions of them the Trustee selects shall be in amounts of $1,000 of principal
amount or a whole multiple of $1,000 of principal amount. Provisions of this
Indenture that apply to Securities called for redemption also apply to portions
of Securities called for redemption. The Trustee shall notify the Company
promptly of the method it has chosen for the selection of Securities or portions
of Securities to be called for redemption.

          SECTION 3.03. NOTICE OF REDEMPTION. (a) At least 30 days but not more
than 60 days before a date for redemption of Securities, the Company shall mail
a notice of redemption by first-class mail to each Holder of Securities to be
redeemed at such Holder's registered address.



                                                                              42

          The notice shall identify the Securities to be redeemed and shall
state:

          (i) the redemption date;

          (ii)   the redemption price and the amount of accrued interest,
     including Additional Interest, if any, to the redemption date;

          (iii) the name and address of the Paying Agent;

          (iv) that Securities called for redemption must be surrendered to the
     Paying Agent to collect the redemption price;

          (v) if fewer than all the outstanding Securities are to be redeemed,
     the certificate numbers and principal amounts of the particular Securities
     to be redeemed;

          (vi) that, unless the Company defaults in making such redemption
     payment or the Paying Agent is prohibited from making such payment pursuant
     to the terms of this Indenture, interest or accretion, as applicable, on
     Securities (or portion thereof) called for redemption ceases to accrue or
     accrete, as applicable, on and after the redemption date;

          (vii) the CUSIP or ISIN number, if any, printed on the Securities
     being redeemed; and

          (viii) that no representation is made as to the correctness or
     accuracy of the CUSIP or ISIN number, if any, listed in such notice or
     printed on the Securities.

          (b) At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at the Company's expense. In such event,
the Company shall provide the Trustee with the information required by this
Section.

          SECTION 3.04. EFFECT OF NOTICE OF REDEMPTION. Once notice of
redemption is mailed, Securities called for redemption become due and payable on
the redemption date and at the redemption price stated in the notice. Upon
surrender to the Paying Agent, such Securities shall be paid at the redemption
price stated in the notice, plus accrued interest, including Additional
Interest, if any, to the redemption date; PROVIDED, HOWEVER, that if the
redemption date is after a regular record date and on or prior to the interest
payment date, the accrued interest, including Additional Interest, if any, shall
be payable to the Holder of the redeemed Securities registered on the relevant
record date. Failure to give notice or any defect in the notice to any Holder
shall not affect the validity of the notice to any other Holder.

          SECTION 3.05. DEPOSIT OF REDEMPTION PRICE. Prior to 11:00 a.m., New
York City time, on the redemption date, the Company shall deposit with the
Paying Agent (or, if the Company or a Wholly Owned Subsidiary is the Paying
Agent, shall segregate and hold in trust) money sufficient to pay the redemption
price of and accrued interest, including Additional Interest, if any, on all
Securities or portions thereof to be



                                                                              42

redeemed on that date other than Securities or portions of Securities called for
redemption that have been delivered by the Company to the Trustee for
cancelation. Concurrently with such deposit, the Company shall deliver an
Officers' Certificate and an Opinion of Counsel to the effect that the
redemption complies with the conditions contained in this Indenture. On and
after the redemption date, interest, including Additional Interest, if any, or
accretion, as applicable, shall cease to accrue or accrete, as applicable, on
Securities or portions thereof called for redemption so long as the Company has
deposited with the Paying Agent funds sufficient to pay the principal of, plus
accrued and unpaid interest, including Additional Interest, if any, on, the
Securities to be redeemed, unless the Paying Agent is prohibited from making
such payment pursuant to the terms of this Indenture.

          SECTION 3.06. SECURITIES REDEEMED IN PART. Upon surrender of a
Security that is redeemed in part, the Company shall execute and the Trustee
shall authenticate for the Holder (at the Company's expense) a new Security
equal in principal amount to the unredeemed portion of the Security surrendered.

                                   ARTICLE IV

                                    COVENANTS

          SECTION 4.01. PAYMENT OF SECURITIES. The Company shall promptly pay
the principal of and interest, including Additional Interest, if any, on the
Securities on the dates and in the manner provided in the Securities and in this
Indenture. Principal and interest, including Additional Interest, if any, shall
be considered paid on the date due if on such date the Trustee or the Paying
Agent holds in accordance with this Indenture money sufficient to pay all
principal and interest then due and the Trustee or the Paying Agent, as the case
may be, is not prohibited from paying such money to the Holders on that date
pursuant to the terms of this Indenture.

          The Company shall pay interest on overdue principal at the rate borne
by the Securities, and it shall pay interest on overdue installments of interest
at the same rate to the extent lawful.

          SECTION 4.02. SEC REPORTS. Notwithstanding that the Company may not be
subject to the reporting requirements of Section 13 or 15(d) of the Exchange
Act, the Company shall file with the SEC (if permitted by SEC practice and
applicable law and regulations) and provide the Trustee and Holders and
prospective Holders (upon request) within 15 days after it files them with the
SEC (or if not permitted, within 15 days after it would have otherwise been
required to file them with the SEC), copies of the Company's annual report and
the information, documents and other reports that are specified in Sections 13
and 15(d) of the Exchange Act. In addition, following the existence of a Public
Market, the Company shall furnish to the Trustee and the Holders, promptly upon
their becoming available, copies of the annual report to shareholders and any
other information provided by the Company to its shareholders generally. The
Company also shall comply with the other provisions of Section 314(a) of the
TIA.



                                                                              44

          Delivery of such reports, information and documents to the Trustee is
for informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).

          For all purposes under this Indenture, including Article VI and
Section 9.02 hereof, holders of Non-Consenting Securities shall not have the
benefit of the terms and provisions of this Section 4.02.

          SECTION 4.03. LIMITATION ON INDEBTEDNESS. (a) The Company shall not,
and shall not permit any Restricted Subsidiary to, Incur, directly or
indirectly, any Indebtedness; PROVIDED, HOWEVER, that the Company or any
Restricted Subsidiary that is a Note Guarantor may Incur Indebtedness if on the
date of such Incurrence and after giving effect thereto the Consolidated
Coverage Ratio would be greater than 2.25:1.00.

          (b) Notwithstanding Section 4.03(a), the Company and its Restricted
Subsidiaries may Incur the following Indebtedness (collectively, the "Permitted
Debt"):

          (i) Indebtedness Incurred pursuant to the Credit Agreement in an
     aggregate principal amount not to exceed $100.0 million at any one time
     outstanding less the aggregate amount of (1) all repayments of principal of
     such Indebtedness pursuant to Section 4.06 and (2) the aggregate principal
     amount of Indebtedness Incurred and at such time outstanding pursuant to
     Section 4.03(b) (ix) .

          (ii) Indebtedness of the Company owed to and held by any Restricted
     Subsidiary or Indebtedness of a Restricted Subsidiary owed to and held by
     the Company or any Restricted Subsidiary; PROVIDED, HOWEVER, that (1) any
     subsequent issuance or transfer of any Capital Stock or any other event
     that results in any such Restricted Subsidiary ceasing to be a Restricted
     Subsidiary or any subsequent transfer of any such Indebtedness (except to
     the Company or a Restricted Subsidiary) shall be deemed, in each case, to
     constitute the Incurrence of such Indebtedness by the issuer thereof, (2)
     if the Company is the obligor on such Indebtedness, such Indebtedness is
     expressly subordinated to the prior payment in full in cash of all
     obligations with respect to the Securities, (3) if a Restricted Subsidiary
     is the obligor on such Indebtedness, such Indebtedness is made pursuant to
     an intercompany note and (4) if a Note Guarantor is the obligor on such
     Indebtedness and the Company or another Note Guarantor is not the obligee,
     such Indebtedness is subordinated in right of payment to the Note Guarantee
     of such Note Guarantor;

          (iii) Indebtedness (1) represented by the Securities, (not including,
     except for clause (2) below, any Additional Securities), the Exchange Notes
     and any replacement Securities issued pursuant to this Indenture, (2)
     represented by Additional Securities issued from time to time in payment of
     accrued interest on



                                                                              45

     the Consenting Securities, including payment of Additional Interest, (3)
     outstanding on the Closing Date (other than the Indebtedness described in
     clauses (i) and (ii) above) including, without limitation, the Senior
     Subordinated Notes and the May 2003 Notes, (4) consisting of Refinancing
     Indebtedness Incurred in respect of any Indebtedness described in this
     clause (iii) (including Refinancing Indebtedness) or Section 4.03(a) and
     (5) consisting of Guarantees of any Indebtedness otherwise permitted by the
     terms of this Indenture;

          (iv) (1) Indebtedness of a Restricted Subsidiary Incurred and
     outstanding on or prior to the date on which such Restricted Subsidiary was
     acquired by the Company (other than Indebtedness Incurred as consideration
     in, or to provide all or any portion of the funds or credit support
     utilized to consummate, the transaction or series of related transactions
     pursuant to which such Restricted Subsidiary became a Subsidiary of or was
     otherwise acquired by the Company) and (2) Refinancing Indebtedness
     Incurred by a Restricted Subsidiary in respect of Indebtedness Incurred by
     such Restricted Subsidiary pursuant to this clause (iv);

          (v) Indebtedness of the Company or a Restricted Subsidiary (1) in
     respect of performance bonds, bankers' acceptances, letters of credit and
     surety or appeal bonds provided by the Company and its Restricted
     Subsidiaries in the ordinary course of their business, and (2) under
     Commodity Agreements, Interest Rate Agreements and Currency Agreements
     entered into for bona fide hedging purposes of the Company or any
     Restricted Subsidiary in the ordinary course of business; PROVIDED,
     HOWEVER, that such Interest Rate Agreements or Currency Agreements do not
     increase the principal amount of Indebtedness of the Company and its
     Restricted Subsidiaries outstanding at any time other than as a result of
     fluctuations in interest rates or foreign currency exchange rates or by
     reason of fees, indemnities and compensation payable thereunder;

          (vi) Indebtedness (including Capitalized Lease Obligations and
     Attributable Debt) Incurred by the Company or any of its Restricted
     Subsidiaries to finance the purchase, lease or improvement of property
     (real or personal), equipment or other assets (in each case whether through
     the direct purchase of assets or the Capital Stock of any Person owning
     such assets); PROVIDED that the aggregate principal amount of all
     Indebtedness Incurred pursuant to this clause (vi) and all Refinancing
     Indebtedness Incurred to refund, refinance or replace any Indebtedness
     Incurred pursuant to this clause (vi), at any time outstanding, does not
     exceed the greater of (x) 5.0% of Tangible Assets and (y) $30.0 million;

          (vii) Indebtedness arising from the honoring by a bank or other
     financial institution of a check, draft or similar instrument drawn against
     insufficient funds in the ordinary course, PROVIDED that such Indebtedness
     is extinguished within five Business Days of Incurrence;



                                                                              46

          (viii) Indebtedness of the Company and its Restricted Subsidiaries
     arising from agreements of the Company or a Restricted Subsidiary providing
     for indemnification, adjustment of purchase price or similar obligations,
     in each case incurred or assumed in connection with the disposition of any
     business, assets or a Subsidiary of the Company in accordance with the
     terms of this Indenture, other than Guarantees by the Company or any
     Restricted Subsidiary of Indebtedness Incurred by any Person acquiring all
     or any portion of such business, assets or a Subsidiary of the Company for
     the purpose of financing such acquisition; PROVIDED, HOWEVER, that the
     maximum aggregate liability in respect of all such Indebtedness shall not
     exceed the gross proceeds, including the fair market value as determined in
     good faith by a majority of the Board of Directors of noncash proceeds (the
     fair market value of such noncash proceeds being measured at the time it is
     received and without giving effect to any subsequent changes in value),
     actually received by the Company and its Restricted Subsidiaries in
     connection with such disposition;

          (ix) the Incurrence by a Securitization Entity of Indebtedness in a
     Qualified Securitization Transaction that is not recourse to the Company or
     any Restricted Subsidiary of the Company (except for Standard
     Securitization Undertakings) in an aggregate principal amount, together
     with the aggregate principal amount of Indebtedness Incurred and at such
     time outstanding pursuant to Section 4.03(b) (i) , not to exceed $100.0
     million at any one time outstanding, less the aggregate amount of all
     repayments of principal of Indebtedness Incurred pursuant to Section
     4.03(b) (i) pursuant to Section 4.06;

          (x) Indebtedness of Foreign Subsidiaries; PROVIDED that the aggregate
     outstanding amount of Indebtedness incurred by such Foreign Subsidiaries
     under this clause (x) does not exceed at any one time an amount equal to
     the sum of (A) 80% of the consolidated book value of the accounts
     receivable of all Foreign Subsidiaries and (B) 60% of the consolidated book
     value of the inventory of all Foreign Subsidiaries;

          (xi) Indebtedness under any Domestic Overdraft Facility; or

          (xii) Indebtedness of the Company and its Restricted Subsidiaries (in
     addition to Indebtedness permitted to be Incurred pursuant to Section
     4.03(a) or any other clause of this Section 4.03(b)); PROVIDED that the
     aggregate principal amount on the date of Incurrence, when added to all
     other Indebtedness Incurred pursuant to this clause (xii) and then
     outstanding, shall not exceed $20.0 million.

          (c) Notwithstanding any other provision of this Section 4.03, the
maximum amount of Indebtedness that the Company or any Restricted Subsidiary may
Incur pursuant to this Section shall not be deemed to be exceeded solely as a
result of fluctuations in the exchange rates of currencies. For purposes of
determining the outstanding principal amount of any particular Indebtedness
Incurred pursuant to this Section 4.03, (i) Indebtedness Incurred pursuant to
the Credit Agreement on the Original Issue Date shall be treated as Incurred
pursuant to Section 4.03 (b)(i), (ii) Guarantees of,



                                                                              47

or obligations in respect of letters of credit relating to, Indebtedness which
is otherwise included in the determination of a particular amount of
Indebtedness shall not be included, (iii) if obligations in respect of letters
of credit are Incurred pursuant to the Credit Agreement and are being treated as
Incurred pursuant to Section 4.03(b)(i) and the letters of credit relate to
other Indebtedness, then such other Indebtedness shall not be included, (iv) the
principal amount of any Disqualified Stock of the Company or a Restricted
Subsidiary or Preferred Stock of a Restricted Subsidiary that is not a Note
Guarantor will be equal to the greater of the maximum mandatory redemption or
repurchase price (not including, in either case, any redemption or repurchase
premium) or the maximum liquidation preference, (v) the principal amount of
Indebtedness, Disqualified Stock of the Company or a Restricted Subsidiary or
Preferred Stock of a Restricted Subsidiary that is not a Note Guarantor issued
at a price less than the principal amount thereof, the maximum fixed redemption
or repurchase price thereof or liquidation preference thereof, as applicable,
will be equal to the amount of the liability or obligation in respect thereof
determined in accordance with GAAP, (vi) if such Indebtedness is denominated in
a currency other than U.S. dollars, the U.S. dollar equivalent principal amount
thereof shall be calculated based on the relevant currency exchange rates in
effect on the date such Indebtedness was Incurred, (vii) the accrual of
interest, accrual of dividends, the accretion of accreted value, the payment of
interest in the form of additional Indebtedness (including the issuance of
Additional Securities in payment of interest on the Consenting Securities, the
Exchange Notes and the Private Exchange Notes) and the payment of dividends or
distributions in the form of additional Capital Stock shall not be deemed an
Incurrence of Indebtedness for purposes of this Section 4.03, (viii)
Indebtedness permitted by this Section 4.03 need not be permitted solely by
reference to one provision permitting such Indebtedness but may be permitted in
part by one such provision and in part by one or more other provisions of this
Section permitting such Indebtedness, and (ix) in the event that Indebtedness
meets the criteria of more than one of the types of Indebtedness described in
this Section 4.03, the Company, in its sole discretion, shall classify (or later
reclassify) such Indebtedness and only be required to include the amount of such
Indebtedness in one of such clauses.

          For all purposes under this Indenture, including Article VI and
Section 9.02 hereof, holders of Non-Consenting Securities shall not have the
benefit of the terms and provisions of this Section 4.03.

          SECTION 4.04. LIMITATION ON RESTRICTED PAYMENTS. (a) The Company shall
not, and shall not permit any Restricted Subsidiary, directly or indirectly, to
(i) declare or pay any dividend or make any distribution of any kind on or in
respect of its Capital Stock (including any payment in connection with any
merger or consolidation involving the Company) or similar payment to the holders
(solely in their capacities as such) of its Capital Stock except dividends or
distributions payable solely in its Capital Stock (other than Disqualified
Stock) and except dividends or distributions payable to the Company or another
Restricted Subsidiary (and, if such Restricted Subsidiary has shareholders other
than the Company or other Restricted Subsidiaries, to its other shareholders on
a pro rata basis), (ii) purchase, redeem, retire or otherwise acquire for value
any Capital Stock of the Company or any Restricted Subsidiary held by Persons
other than the Company or another Restricted Subsidiary, (iii) purchase,
repurchase,



                                                                              48

redeem, defease or otherwise acquire or retire for value, prior to scheduled
maturity, scheduled repayment or scheduled sinking fund payment any Subordinated
Obligations (other than (1) the purchase, repurchase or other acquisition of
Subordinated Obligations purchased in anticipation of satisfying a sinking fund
obligation, principal installment or final maturity, in each case due within one
year of the date of acquisition and (2) Indebtedness Incurred pursuant to
Section 4.03(b)(ii)) or (iv) make any Investment (other than a Permitted
Investment) in any Person (any such dividend, distribution, purchase,
redemption, repurchase, defeasance, other acquisition, retirement or Investment
being herein referred to as a "Restricted Payment") if at the time the Company
or such Restricted Subsidiary makes such Restricted Payment:

          (1) a Default shall have occurred and be continuing (or would
     result therefrom);

          (2) the Company could not Incur at least $1.00 of additional
     Indebtedness under Section 4.03(a); or

          (3) the aggregate amount of such Restricted Payment and all other
     Restricted Payments (the amount so expended, if other than in cash, to be
     determined in good faith by the Board of Directors, whose determination
     shall be conclusive and evidenced by a resolution of the Board of
     Directors) declared or made subsequent to the Original Issue Date would
     exceed the sum, without duplication, of:

               (i) 50% of the Consolidated Net Income accrued during the period
          (treated as one accounting period) from the beginning of the second
          quarter of fiscal year 2004 to the end of the most recent fiscal
          quarter ending prior to the date of such Restricted Payment for which
          consolidated financial statements of the Company are publicly
          available (or, in case such Consolidated Net Income shall be a
          deficit, minus 100% of such deficit);

               (ii) 100% of the aggregate Net Cash Proceeds (other than in
          respect of an Excluded Contribution) received by the Company (x) as
          capital contributions to the Company after the Original Issue Date or
          (y) from the issue or sale of its Capital Stock (other than
          Disqualified Stock) subsequent to the Original Issue Date (other than
          a capital contribution from or an issuance or sale to (a) a Subsidiary
          of the Company or (b) an employee equity ownership or participation
          plan or other trust established by the Company or any of its
          Subsidiaries);

               (iii) 100% of the fair market value (as determined in good faith
          by the Board of Directors of the Company) of shares of Qualified Stock
          of the Company or any Restricted Subsidiary issued after the Original
          Issue Date to acquire assets from a third party;



                                                                              49

               (iv) the amount by which Indebtedness of the Company or its
          Restricted Subsidiaries is reduced on the Company's balance sheet upon
          the conversion or exchange (other than by a Subsidiary of the Company)
          subsequent to the Original Issue Date of any Indebtedness of the
          Company or its Restricted Subsidiaries issued after the Original Issue
          Date which is convertible or exchangeable for Capital Stock (other
          than Disqualified Stock) of the Company (less the amount of any cash
          or the fair market value of other property distributed by the Company
          or any Restricted Subsidiary upon such conversion or exchange);

               (v) 100% of the aggregate amount received by the Company or any
          Restricted Subsidiary in cash from the sale or other disposition
          (other than to (x) the Company or a Subsidiary of the Company or (y)
          an employee equity ownership or participation plan or other trust
          established by the Company or any of its Subsidiaries) of Restricted
          Investments made by the Company or any Restricted Subsidiary after the
          Original Issue Date and from repurchases and redemptions of such
          Restricted Investments from the Company or any Restricted Subsidiary
          by any Person (other than (x) the Company or any of its Subsidiaries
          or (y) an employee equity ownership or participation plan or other
          trust established by the Company or any of its Restricted
          Subsidiaries) and from repayments of loans or advances which
          constituted Restricted Investments;

               (vi) the amount equal to the net reduction in Investments in
          Unrestricted Subsidiaries since the Original Issue Date, resulting
          from (x) payments of dividends, repayments of the principal of loans
          or advances or other transfers of assets to the Company or any
          Restricted Subsidiary from Unrestricted Subsidiaries or (y) the
          redesignation of Unrestricted Subsidiaries as Restricted Subsidiaries
          (valued in each case as provided in the definition of "Investment")
          not to exceed, in the case of any Unrestricted Subsidiary, the amount
          of Investments previously made by the Company or any Restricted
          Subsidiary in such Unrestricted Subsidiary, which amount was included
          in the calculation of the amount of Restricted Payments; and

               (vii) $5.0 million.

          (b) The provisions of Section 4.04(a) shall not prohibit:

          (i) any purchase, repurchase, retirement or other acquisition or
     retirement for value of, or other distribution in respect of, Capital Stock
     of the Company made by exchange for, or out of the proceeds of the
     substantially concurrent sale of, Capital Stock of the Company or capital
     contributions to the Company after the Closing Date (other than
     Disqualified Stock and other than Capital Stock issued or sold to, or
     capital contributions from, a Subsidiary of the Company or an employee
     equity ownership or participation plan or other trust established by the
     Company or any of its Subsidiaries); PROVIDED, HOWEVER, that (1) such
     Restricted



                                                                              50

     Payment shall be excluded in the calculation of the amount of Restricted
     Payments and (2) the Net Cash Proceeds from such sale or capital
     contribution applied in the manner set forth in this clause (i) shall be
     excluded from the calculation of amounts under Section 4.04(a)(iv)(3)(ii);

          (ii) any purchase, repurchase, redemption, defeasance or other
     acquisition or retirement for value of Subordinated Obligations of the
     Company or a Restricted Subsidiary made by exchange for, or out of the
     proceeds of the substantially concurrent sale of, (x) Capital Stock of the
     Company or a Restricted Subsidiary or (y) Subordinated Obligations of the
     Company or a Restricted Subsidiary that are permitted to be Incurred
     pursuant to Section 4.03; PROVIDED, HOWEVER, that such purchase,
     repurchase, redemption, defeasance or other acquisition or retirement for
     value shall be excluded in the calculation of the amount of Restricted
     Payments;

          (iii) any purchase or redemption of Subordinated Obligations from Net
     Available Cash to the extent permitted by Section 4.06; PROVIDED, HOWEVER,
     that such purchase or redemption shall be excluded in the calculation of
     the amount of Restricted Payments;

          (iv) Investments that are made with Excluded Contributions; PROVIDED,
     HOWEVER, that such Investments shall be excluded in the calculation of the
     amount of Restricted Payments;

          (v) dividends or other distributions paid to holders of, or
     redemptions from holders of, Capital Stock within 60 days after the date of
     declaration thereof, or the giving of formal notice of redemption, if at
     such date of declaration such dividends or other distributions or
     redemptions would have complied with Section 4.04(a); PROVIDED, HOWEVER,
     that such dividend, distribution or redemption shall be included in the
     calculation of the amount of Restricted Payments;

          (vi) any repurchase of Capital Stock owned by former officers,
     directors, consultants or employees of the Company or its Subsidiaries or
     their assigns, estates and heirs or entities controlled by them; PROVIDED,
     HOWEVER, that the amount of such repurchases since the Original Issue Date
     shall not, in the aggregate, exceed the sum of (1) $10.0 million (which
     amount shall be increased by the amount of any Net Cash Proceeds to the
     Company from (A) sales of Capital Stock of the Company to management, other
     employees or Permitted Holders subsequent to the Closing Date to the extent
     such amounts are not included under Section 4.04(a)(iv)(3)(ii) and (B) any
     "key-man" life insurance policies which are used to make such repurchases)
     and (2) $2.0 million per fiscal year of the Company commencing with fiscal
     year 2003 (which amount may be used in a subsequent fiscal year to the
     extent not used during a fiscal year); PROVIDED FURTHER, HOWEVER, that the
     cancelation of Indebtedness owing to the Company from such former officers,
     directors, consultants or employees of the Company or any of its Restricted
     Subsidiaries in connection with a repurchase of Capital Stock of the
     Company shall not be deemed to constitute a Restricted



                                                                              51

     Payment under this Indenture; PROVIDED FURTHER, HOWEVER, that such
     repurchase shall be included in the calculation of the amount of Restricted
     Payments;

          (vii) repurchases of Capital Stock deemed to occur upon the exercise
     of stock options, warrants or other convertible securities if such Capital
     Stock represents a portion of the exercise price thereof; PROVIDED,
     HOWEVER, that such repurchases shall be excluded in the calculation of the
     amount of Restricted Payments; or

          (viii) so long as no Default or Event of Default shall have occurred
     and be continuing, payments not to exceed $500,000 in the aggregate since
     the Original Issue Date to enable the Company to make payments to holders
     of its Capital Stock in lieu of the issuance of fractional shares of its
     Capital Stock; PROVIDED, HOWEVER, that such payments shall be excluded in
     the calculation of the amount of Restricted Payments.

          For all purposes under this Indenture, including Article VI and
Section 9.02 hereof, holders of Non-Consenting Securities shall not have the
benefit of the terms and provisions of this Section 4.04.

          SECTION 4.05. LIMITATION ON RESTRICTIONS ON DISTRIBUTIONS FROM
RESTRICTED SUBSIDIARIES AND NEGATIVE PLEDGES. The Company shall not, and shall
not permit any Restricted Subsidiary to, create or otherwise cause or permit to
exist or become effective any consensual encumbrance or restriction on the
ability of any Restricted Subsidiary to (a) pay dividends or make any other
distributions on its Capital Stock or pay any Indebtedness or other obligations
owed to the Company or any of its Restricted Subsidiaries (it being understood
that the priority of any preferred stock in receiving dividends or liquidating
distributions prior to dividends or liquidating distributions being paid on
common stock shall not be deemed a restriction on the ability to make
distributions on Capital Stock), (b) make any loans or advances to the Company
(it being understood that the subordination of loans or advances made to the
Company to other Indebtedness Incurred by the Company shall not be deemed a
restriction on the ability to make loans or advances), (c) transfer any of its
property or assets to the Company, except (with respect to clauses (a), (b) and
(c), unless stated otherwise):

          (i) any encumbrance or restriction pursuant to applicable law or any
     applicable rule, regulation or order, or an agreement in effect at or
     entered into on the Closing Date (including the Credit Agreement, this
     Indenture, the Security Documents (whether or not they become effective on
     or after the Closing Date), the Senior Subordinated Notes Indentures and
     the May 2003 Notes Documents);

          (ii) any encumbrance or restriction with respect to Second-Priority
     Collateral pursuant to a security agreement, pledge agreement or other
     document in connection with any Credit Agreement Obligation Incurred after
     the Closing Date;



                                                                              52

          (iii) any encumbrance or restriction with respect to a Restricted
     Subsidiary pursuant to an agreement relating to any Capital Stock or
     Indebtedness of such Restricted Subsidiary, in each case Incurred by such
     Restricted Subsidiary prior to the date on which such Restricted Subsidiary
     was acquired by the Company (other than Capital Stock or Indebtedness
     Incurred as consideration in, in contemplation of, or to provide all or any
     portion of the funds or credit support utilized to consummate the
     transaction or series of related transactions pursuant to which such
     Restricted Subsidiary became a Restricted Subsidiary or was otherwise
     acquired by the Company) and outstanding on such date;

          (iv) any encumbrance or restriction pursuant to an agreement effecting
     a Refinancing of Indebtedness Incurred pursuant to an agreement referred to
     in clause (c)(i), (c)(ii) or (c)(iii) of this Section 4.05 or this clause
     (c)(iv) or contained in any amendment to an agreement referred to in clause
     (c)(i), (c)(ii) or (c)(iii) of this Section 4.05 or this clause (c)(iv);
     PROVIDED, HOWEVER, that the encumbrances and restrictions contained in any
     such Refinancing agreement or amendment (1) are no more restrictive, taken
     as a whole, than the encumbrances and restrictions contained in such
     predecessor agreements and (2) may restrict the ability of the Company or
     any Restricted Subsidiary to transfer any First-Priority Collateral only to
     the extent the terms of the Indebtedness being Refinanced contained a
     similar restriction;

          (v) in the case of clause (c), any encumbrance or restriction (1) that
     restricts in a customary manner the assignment of any lease, license or
     similar contract or the subletting, assignment or transfer of any property
     or asset that is subject to a lease, license or similar contract, (2) that
     is or was created by virtue of any transfer of, agreement to transfer or
     option or right with respect to any property or assets of the Company or
     any Restricted Subsidiary not otherwise prohibited by this Indenture, (3)
     contained in security agreements securing Indebtedness of a Restricted
     Subsidiary to the extent such encumbrance or restriction restricts the
     transfer of the property subject to such security agreements, or (4)
     encumbrances or restrictions relating to Indebtedness permitted to be
     Incurred pursuant to Section 4.03(b)(vi) for property acquired in the
     ordinary course of business that only imposes encumbrances or restrictions
     on the property so acquired (it being agreed that any such encumbrance or
     restriction may also secure other Indebtedness permitted to be Incurred by
     the Company and provided by the same financing source providing the
     Indebtedness Incurred pursuant to Section 4.03(b)(vi));

          (vi) with respect to a Restricted Subsidiary, any customary
     restriction imposed pursuant to an agreement entered into for the sale or
     disposition of all or substantially all the Capital Stock or assets of such
     Restricted Subsidiary pending the closing of such sale or disposition;

          (vii) customary provisions in joint venture agreements and other
     similar agreements entered into in the ordinary course of business;



                                                                              53

          (viii) Indebtedness or other contractual requirements of a
     Securitization Entity in connection with a Qualified Securitization
     Transaction; PROVIDED, that such restrictions apply only to such
     Securitization Entity;

          (ix) net worth provisions in leases and other agreements entered into
     by the Company or any Restricted Subsidiary in the ordinary course of
     business; or

          (x) any agreement or instrument governing Indebtedness (whether or not
     outstanding) of Foreign Subsidiaries of the Company permitted to be
     Incurred pursuant to Section 4.03(a) or Section 4.03(b)(x); or

     (d) create, incur or permit to exist any Lien on any First-Priority
Collateral for the benefit of any First-Priority Obligations, except:

          (i) any encumbrance or restriction pursuant to applicable law or any
     applicable rule, regulation or order, or an agreement in effect at or
     entered into on the Closing Date;

          (ii) any encumbrance or restriction pursuant to an agreement effecting
     a Refinancing of Indebtedness Incurred pursuant to an agreement referred to
     in clause (d)(i) of this Section 4.05 or this clause (d)(ii) or contained
     in any amendment to an agreement referred to in clause (d)(i) of this
     Section 4.05 or this clause (d)(ii); PROVIDED, HOWEVER, that the
     encumbrances and restrictions contained in any such Refinancing agreement
     or amendment are no more restrictive, taken as a whole, than the
     encumbrances and restrictions contained in such predecessor agreements;

          (iii) with respect to a Restricted Subsidiary, any customary
     restriction imposed pursuant to an agreement entered into for the sale or
     disposition of all or substantially all the Capital Stock or assets of such
     Restricted Subsidiary pending the closing of such sale or disposition; or

          (iv) customary restrictions and conditions provided by the terms of
     any (a) Permitted Lien (or the agreements governing any Indebtedness to
     which such Permitted Lien relates) described under clause (d), (e) or (f)
     of the definition thereof or, to the extent Incurred in connection with
     Refinancing Indebtedness that Refinances the Indebtedness secured by such
     Permitted Lien described under clause (d), (e) or (f) of the definition
     thereof, clause (j) of the definition thereof; PROVIDED that such
     restrictions or conditions apply only to the property or assets the subject
     of such Permitted Lien and such restrictions and conditions are no more
     restrictive than those provided by the terms of the Permitted Lien (or the
     agreements governing any Indebtedness to which such Permitted Lien relates)
     and or (b) Indebtedness permitted by Section 4.03(b)(iv); PROVIDED that
     such restrictions or conditions apply only to the property or assets of the
     applicable Restricted Subsidiary and any such restrictions and conditions
     provided by the terms of any Refinancing Indebtedness with respect to any
     such Indebtedness are



                                                                              54

     no more restrictive than those provided by the terms of the Indebtedness
     being Refinanced.

          For all purposes under this Indenture, including Article VI and
Section 9.02 hereof, holders of Non-Consenting Securities shall not have the
benefit of the terms and provisions of this Section 4.05.

          SECTION 4.06. LIMITATION ON SALES OF ASSETS AND SUBSIDIARY STOCK. (a)
The Company shall not, and shall not permit any Restricted Subsidiary to, make
any Asset Disposition with respect to First-Priority Collateral unless (i) the
Company or such Restricted Subsidiary receives consideration (including by way
of relief from, or by any other Person assuming sole responsibility for, any
liabilities, contingent or otherwise) at the time of such Asset Disposition at
least equal to the fair market value of the Capital Stock and assets subject to
such Asset Disposition, (ii) at least 75% of the consideration thereof received
by the Company or such Restricted Subsidiary is in the form of (A) cash or
Temporary Cash Investments, (B) First-Priority Assets to be owned by the Company
or any Restricted Subsidiary and used in a Permitted Business, to the extent
they are concurrently with their acquisition added to the First-Priority
Collateral securing the Securities, or (C) Capital Stock in one or more Persons
engaged in a Permitted Business that are or thereby become Wholly Owned
Subsidiaries of the Company and (iii) to the extent Capital Stock of a Person is
received by the Company and its Restricted Subsidiaries pursuant to clause
(ii)(C) above, assets of such Person that qualify as First-Priority Assets with
a fair market value that is equal to or greater than (A) 75% of the fair market
value of the First-Priority Collateral that is the subject of such Asset
Disposition less (B) the fair market value of any consideration received by the
Company and its Restricted Subsidiaries pursuant to clause (ii)(A) or (B) above
are concurrently with the acquisition added to the First-Priority Collateral
securing the Securities; and (iv) an amount equal to 100% of the Net Available
Cash from such Asset Disposition is applied by the Company (or such Restricted
Subsidiary, as the case may be):

          (A) first, to the extent the Company or such Restricted Subsidiary
     elects, to reinvest in Additional Assets (including by means of an
     Investment in Additional Assets by a Restricted Subsidiary with Net
     Available Cash received by the Company or another Restricted Subsidiary or
     the application by the Company of the Net Available Cash received by a
     Restricted Subsidiary of the Company), in each case within 365 days (or, in
     the case of Foreign Subsidiary Asset Dispositions, 545 days) from the later
     of such Asset Disposition or the receipt of such Net Available Cash,
     PROVIDED that such Additional Assets constitute (x) First-Priority Assets
     that are concurrently with their acquisition added to the First-Priority
     Collateral securing the Securities or (y) Capital Stock of a Wholly Owned
     Subsidiary with assets that qualify as First-Priority Assets to the extent
     that such First Priority Assets, together with any First-Priority Assets
     described in clause (x), have a fair market value that is equal to or
     greater than the Net Available Cash applied pursuant to this clause (A) and
     such First-Priority Assets are concurrently with the acquisition added to
     the First-Priority Collateral securing the Securities and PROVIDED FURTHER
     that pending the final application of



                                                                              55

     any such Net Available Cash, it must be deposited in a Notes Collateral
     Account and pledged as additional First-Priority Collateral;

          (B) second, within 365 days from the later of such Asset Disposition
     or the receipt of such Net Available Cash (or, in the case of Foreign
     Subsidiary Asset Dispositions, 545 days), to the extent of the balance of
     such Net Available Cash after such application in accordance with clause
     (A), to make an Offer (as defined below) to purchase First-Priority
     Obligations pursuant to and subject to the conditions set forth in Section
     4.06(c); and

          (C) third, to the extent of the balance of such Net Available Cash
     after application in accordance with clauses (A) (other than the second
     proviso thereto) and (B), for any general corporate purpose not restricted
     by the terms of this Indenture.

          (b) The Company will not, and will not permit any Restricted
Subsidiary to, make any Asset Disposition (other than an Asset Disposition of
First-Priority Collateral) unless:

          (i) the Company or such Restricted Subsidiary receives consideration
     (including by way of relief from, or by any other Person assuming sole
     responsibility for, any liabilities, contingent or otherwise) at the time
     of such Asset Disposition at least equal to the fair market value of the
     Capital Stock and assets subject to such Asset Disposition, (ii) at least
     75% of the consideration thereof received by the Company or such Restricted
     Subsidiary is in the form of (A) cash or Temporary Cash Investments, (B)
     properties and assets to be owned by the Company or any Restricted
     Subsidiary and used in a Permitted Business or (C) Capital Stock in one or
     more Persons engaged in a Permitted Business that are or thereby become
     Restricted Subsidiaries of the Company, and (iii) an amount equal to 100%
     of the Net Available Cash from such Asset Disposition is applied by the
     Company (or such Restricted Subsidiary, as the case may be):

          (A) first, (i) to the extent the Company elects (or is required by the
     terms of any Indebtedness), to prepay, repay, redeem or purchase any Credit
     Agreement Obligations or any Indebtedness Incurred by a Subsidiary of the
     Company that is not a Note Guarantor, or (ii) to the extent the Company or
     such Restricted Subsidiary elects, to reinvest in Additional Assets
     (including by means of an Investment in Additional Assets by a Restricted
     Subsidiary with Net Available Cash received by the Company or another
     Restricted Subsidiary or the application by the Company of the Net
     Available Cash received by a Restricted Subsidiary of the Company), in each
     case within 365 days (or, in the case of Foreign Subsidiary Asset
     Dispositions, 545 days) from the later of such Asset Disposition or the
     receipt of such Net Available Cash, PROVIDED that pending the final
     application of any such Net Available Cash, the Company and its Restricted
     Subsidiaries may temporarily reduce Indebtedness or otherwise invest such
     Net Available Cash in any manner not prohibited by this Indenture;



                                                                              56

          (B) second, within 365 days from the later of such Asset Disposition
     or the receipt of such Net Available Cash (or, in the case of Foreign
     Subsidiary Asset Dispositions, 545 days), to the extent of the balance of
     such Net Available Cash after such application in accordance with clause
     (A), to make an Offer (as defined below) to purchase Securities pursuant to
     and subject to the conditions set forth in Section 4.06(c); PROVIDED,
     HOWEVER, that if the Company elects (or is required by the terms of any
     other Senior Indebtedness) such Offer may be made ratably to purchase the
     Securities and such other Senior Indebtedness of the Company; and

          (C) third, to the extent of the balance of such Net Available Cash
     after application in accordance with clauses (A) (other than the proviso
     thereof) and (B), for any general corporate purpose not restricted by the
     terms of this Indenture;

PROVIDED, HOWEVER, that in connection with any prepayment, repayment or purchase
of Indebtedness pursuant to clause (A) or (B) above, the Company or such
Restricted Subsidiary shall retire such Indebtedness and shall cause the related
loan commitment (if any) to be permanently reduced in an amount equal to the
principal amount so prepaid, repaid or purchased.

          Notwithstanding the foregoing provisions of this Section 4.06, the
Company and the Restricted Subsidiaries shall not be required to apply any Net
Available Cash from Asset Dispositions that are not Asset Dispositions of
First-Priority Collateral in accordance with this Section 4.06 except to the
extent that the aggregate Net Available Cash from all such Asset Dispositions
since the Original Issue Date that is not applied in accordance with this
Section 4.06 exceeds $10.0 million since the Original Issue Date.

          For the purposes of this Section 4.06, the following are deemed to be
cash: (A) the assumption of any liabilities of the Company (other than
Disqualified Stock of the Company) or any Restricted Subsidiary and the release
of the Company or such Restricted Subsidiary from all liability on such
liabilities in connection with such Asset Disposition; PROVIDED that, with
respect to any Asset Disposition of First-Priority Collateral, such liabilities
constituted Trade Payables or First-Priority Obligations and (B) securities
received by the Company or any Restricted Subsidiary from the transferee that
are promptly converted by the Company or such Restricted Subsidiary into cash.

          For the purposes of this Section 4.06, any sale by the Company or a
Restricted Subsidiary of the Capital Stock of a Note Guarantor that owns assets
constituting First-Priority Collateral or Second-Priority Collateral shall be
deemed to be a sale of such First-Priority Collateral or Second-Priority
Collateral (or, in the event of a Note Guarantor that owns assets that include
both First-Priority Collateral and Second-Priority Collateral, a separate sale
of such First-Priority Collateral and a separate sale of such Second-Priority
Collateral). In the event of any such sale (or a sale of assets that includes
both First-Priority Collateral and Second-Priority Collateral), the proceeds
received by the Company and the Restricted Subsidiaries in respect of such sale
shall be allocated to the First-Priority Collateral and the Second-Priority
Collateral in accordance



                                                                              57

with their respective fair market values, which shall be determined by Board of
Directors or an independent third party as provided by the terms of the
Intercreditor Agreement.

          (c) In the event of an Asset Disposition that requires the purchase of
Securities (and other Senior Indebtedness) pursuant to Section 4.06(a)(iv)(B) or
4.06(b)(iii)(B), the Company shall be required to purchase Securities (and other
Senior Indebtedness) tendered pursuant to an offer by the Company for the
Securities (and other Senior Indebtedness) (the "Offer") at a purchase price of
(i) in the case of Non-Consenting Securities, 100% of their Accreted Value or
principal amount plus accrued and unpaid interest, including Additional
Interest, if any, to the date of purchase (subject to the right of Holders of
record on the relevant record date to receive interest due on the relevant
interest payment date) or (ii) in the case of all other Securities, 100% of the
sum of their principal amount plus accrued and unpaid interest, including
Additional Interest, if any, to the date of purchase (subject to the right of
Holders of record on the relevant record date to receive interest due on the
relevant interest payment date), in each case, in accordance with the procedures
(including proration in the event of oversubscription) set forth in Section
4.06(d). If the aggregate purchase price of Securities (and other Senior
Indebtedness) tendered pursuant to the Offer is less than the Net Available Cash
allotted to the purchase of the Securities (and other Senior Indebtedness), the
Company shall apply the remaining Net Available Cash for any general corporate
purpose not restricted by the terms of this Indenture. The Company shall not be
required to make an Offer for Securities (and other Senior Indebtedness)
pursuant to this Section 4.06 if the Net Available Cash available therefor
(after application of the proceeds as provided in Section 4.06(a)(iv)(A) or
4.06(b)(iii)(A)) is less than $10.0 million for any particular Asset Disposition
since the Original Issue Date (which lesser amount shall be carried forward for
purposes of determining whether an Offer is required with respect to the Net
Available Cash from any subsequent Asset Disposition). Upon completion of the
Offer, the amount of Net Available Cash shall be reduced to zero.

          (d) (i) Promptly, and in any event within 10 days after the Company
becomes obligated to make an Offer, the Company shall be obligated to deliver to
the Trustee and send, by first-class mail to each Holder, a written notice
stating that the Holder may elect to have his Securities purchased by the
Company either in whole or in part (subject to proration as hereinafter
described in the event the Offer is oversubscribed) in integral multiples of
$1,000 of principal amount, at the applicable purchase price. The notice shall
specify a purchase date not less than 30 days nor more than 60 days after the
date of such notice (the "Purchase Date") and shall contain such information
concerning the business of the Company which the Company in good faith believes
will enable such Holders to make an informed decision (which at a minimum shall
include (1) the most recently filed Annual Report on Form 10-K (including
audited consolidated financial statements) of the Company, the most recent
subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form
8-K of the Company filed subsequent to such Quarterly Report, other than Current
Reports describing Asset Dispositions otherwise described in the offering
materials (or corresponding successor reports), (2) a description of material
developments in the Company's business subsequent to the date of the latest of
such reports, and (3) if material, appropriate pro



                                                                              58

forma financial information) and all instructions and materials necessary to
tender Securities pursuant to the Offer, together with the address referred to
in clause (d)(iii).

          (ii) Not later than the date upon which written notice of an Offer is
     delivered to the Trustee as provided above, the Company shall deliver to
     the Trustee an Officers' Certificate as to (1) the amount of the Offer (the
     "Offer Amount"), (2) the allocation of the Net Available Cash from the
     Asset Dispositions pursuant to which such Offer is being made and (3) the
     compliance of such allocation with the provisions of Section 4.06(a) and
     Section 4.06(b), as applicable. By no later than 11:00 a.m. New York City
     time on the Purchase Date, the Company shall irrevocably deposit with the
     Trustee or with a paying agent (or, if the Company is acting as its own
     paying agent, segregate and hold in trust) an amount equal to the Offer
     Amount or, if less, the purchase price of Securities (and other Senior
     Indebtedness) tendered and accepted for payment in the Offer. Upon the
     expiration of the period for which the Offer remains open (the "Offer
     Period"), the Company shall deliver to the Trustee for cancellation the
     Securities or portions thereof that have been properly tendered to and are
     to be accepted by the Company. The Trustee (or the Paying Agent, if not the
     Trustee) shall, on the date of purchase, mail or deliver payment to each
     tendering Holder in the amount of the purchase price.

          (iii) Holders electing to have a Security purchased shall be required
     to surrender the Security, with an appropriate form duly completed, to the
     Company at the address specified in the notice at least three Business Days
     prior to the Purchase Date. Holders shall be entitled to withdraw their
     election if the Trustee or the Company receives not later than one Business
     Day prior to the Purchase Date, a telegram, telex, facsimile transmission
     or letter setting forth the name of the Holder, the principal amount of the
     Security which was delivered by the Holder for purchase and a statement
     that such Holder is withdrawing his election to have such Security
     purchased. If at the expiration of the Offer Period the aggregate principal
     amount of Securities and any other Senior Indebtedness included in the
     Offer surrendered by holders thereof exceeds the Offer Amount, the Company
     shall select the Securities and other Senior Indebtedness to be purchased
     on a pro rata basis (with such adjustments as may be deemed appropriate by
     the Company so that only Securities and other Senior Indebtedness in
     denominations of $1,000 principal amount, or integral multiples thereof,
     shall be purchased). Holders whose Securities are purchased only in part
     will be issued new Securities equal in principal amount to the unpurchased
     portion of the Securities surrendered.

          (iv) At the time the Company delivers Securities to the Trustee which
     are to be accepted for purchase, the Company shall also deliver an
     Officers' Certificate stating that such Securities are to be accepted by
     the Company pursuant to and in accordance with the terms of this Section. A
     Security shall be deemed to have been accepted for purchase at the time the
     Trustee, directly or through an agent, mails or delivers payment therefor
     to the surrendering Holder.



                                                                              59

          (v) The Company shall comply, to the extent applicable, with the
     requirements of Section 14(e) of the Exchange Act and any other securities
     laws or regulations in connection with the repurchase of Securities
     pursuant to this Section. To the extent that the provisions of any
     securities laws or regulations conflict with provisions of this Section,
     the Company shall comply with the applicable securities laws and
     regulations and shall not be deemed to have breached its obligations under
     this Section by virtue thereof.

          For all purposes under this Indenture, including Article VI and
Section 9.02 hereof, holders of Non-Consenting Securities shall not have the
benefit of the terms and provisions of this Section 4.06.

          SECTION 4.07. LIMITATION ON TRANSACTIONS WITH AFFILIATES. (a) The
Company shall not, and shall not permit any Restricted Subsidiary to, directly
or indirectly, enter into or conduct any transaction (including, the purchase,
sale, lease or exchange of any property or the rendering of any service) with
any Affiliate of the Company (an "Affiliate Transaction") unless such Affiliate
Transaction is on terms (i) that are no less favorable to the Company or such
Restricted Subsidiary, as the case may be, than those that could be obtained at
the time of such transaction in arm's-length dealings with a Person who is not
such an Affiliate, (ii) that, in the event that such Affiliate Transaction
involves an aggregate amount in excess of $5.0 million, (1) are set forth in
writing and (2) except as provided in Section 4.07(a)(iii), have been approved
by a majority of the members of the Board of Directors having no personal stake
in such Affiliate Transaction (if any such members exist) and (iii) that, in the
event (1) such Affiliate Transaction involves an amount in excess of $10.0
million, or (2) if there are no members of the Board of Directors having no
personal stake in such Affiliate Transaction and such Affiliate Transaction
involves an aggregate amount in excess of $5.0 million, have been determined by
a nationally recognized appraisal, accounting or investment banking firm to be
fair, from a financial standpoint, to the Company and its Restricted
Subsidiaries.

          (b) The provisions of Section 4.07(a) shall not prohibit (i) any
Restricted Payment permitted to be paid pursuant to Section 4.04, (ii) any
issuance of securities, or other payments awards or grants in cash, securities
or otherwise pursuant to, or the funding of, employment arrangements, options to
purchase Capital Stock of the Company and equity ownership, restricted stock
plans, long-term incentive plans, stock appreciation rights plans, participation
plans or similar employee benefits plans approved by the Board of Directors,
(iii) the grant of options (and the exercise thereof) to purchase Capital Stock
of the Company or similar rights to employees and directors of the Company
pursuant to plans approved by the Board of Directors, (iv) loans or advances to
officers, directors or employees in the ordinary course of business, but in any
event not to exceed $2.0 million in the aggregate outstanding at any one time
with respect to all loans and advances made since the Original Issue Date, (v)
the payment of reasonable fees to directors of the Company and its Subsidiaries
who are not employees of the Company or its Subsidiaries and other reasonable
fees, compensation, benefits and indemnities paid or entered into by the Company
or its Restricted Subsidiaries in the ordinary course of business to or with the
officers, directors or employees of the Company and its Restricted



                                                                              60

Subsidiaries, (vi) any transaction between the Company and a Restricted
Subsidiary or between Restricted Subsidiaries, (vii) the provision by Persons
who may be deemed Affiliates or stockholders of the Company (other than J.P.
Morgan Partners, LLC and Persons directly or indirectly controlled by J.P.
Morgan Partners, LLC) of investment banking, commercial banking, trust, lending
or financing, investment, underwriting, placement agent, financial advisory or
similar services to the Company or its Subsidiaries performed after the Closing
Date, (viii) sales of Capital Stock to Permitted Holders approved by a majority
of the members of the Board of Directors who do not have a material direct or
indirect financial interest in or with respect to the transaction being
considered, or (ix) the existence or performance by the Company or any
Restricted Subsidiary under any agreement as in effect as of the Closing Date or
replacement agreement therefor or any transaction contemplated thereby
(including pursuant to any amendment thereto or replacement agreement therefor)
so long as such amendment or replacement is not more disadvantageous to the
Holders of the Securities in any material respect than the original agreement as
in effect on the Closing Date.

          For all purposes under this Indenture, including Article VI and
Section 9.02 hereof, holders of Non-Consenting Securities shall not have the
benefit of the terms and provisions of this Section 4.07.

          SECTION 4.08. CHANGE OF CONTROL. (a) Upon a Change of Control, each
Holder shall have the right to require that the Company repurchase all or any
part of such Holder's Securities at a purchase price in cash equal to (i) in the
case of Non-Consenting Securities, 101% of the Accreted Value or principal
amount thereof plus accrued and unpaid interest, including Additional Interest,
if any, to the date of repurchase (subject to the right of Holders of record on
the relevant record date to receive interest, including Additional Interest, if
any, due on the relevant interest payment date) or (ii) in the case of all other
Securities, 101% of the sum of their principal amount plus accrued and unpaid
interest, including Additional Interest, if any, to the date of purchase
(subject to the right of Holders of record on the relevant record date to
receive interest due on the relevant interest payment date), in each case, in
accordance with the terms contemplated in Section 4.08(b); PROVIDED, HOWEVER,
that notwithstanding the occurrence of a Change of Control, the Company shall
not be obligated to repurchase the Securities pursuant to this Section 4.08 in
the event that it has exercised its right to redeem all the Securities under
paragraph 5 of the Securities. In the event that at the time of such Change of
Control the terms of any agreement governing Bank Indebtedness of the Company or
its Subsidiaries restrict or prohibit the repurchase of Securities pursuant to
this Section 4.08, then prior to the mailing of the notice to Holders provided
for in Section 4.08(b) but in any event within 30 days following any Change of
Control, the Company shall (i) repay in full all such Bank Indebtedness or offer
to repay in full all such Bank Indebtedness and repay the Bank Indebtedness of
each lender who has accepted such offer or (ii) obtain the requisite consent of
the lenders under such agreements to permit the repurchase of the Securities as
provided for in Section 4.08(b).



                                                                              61

          (b) Within 30 days following any Change of Control (except as provided
in the proviso to the first sentence of Section 4.08(a)), the Company shall mail
a notice to each Holder with a copy to the Trustee (the "Change of Control
Offer") stating:

          (i) that a Change of Control has occurred and that such Holder has the
     right to require the Company to purchase all or a portion (in integral
     multiples of $1,000 principal amount) of such Holder's Securities at a
     purchase price in cash equal to (A) in the case of Non-Consenting
     Securities, 101% of the Accreted Value or principal amount thereof, plus
     accrued and unpaid interest, including Additional Interest, if any, to the
     date of repurchase (subject to the right of Holders of record on the
     relevant record date to receive interest, if any, due on the relevant
     interest payment date) or (B) in the case of all other Securities, 101% of
     the sum of their principal amount plus accrued and unpaid interest,
     including Additional Interest, if any, to the date of purchase (subject to
     the right of Holders of record on the relevant record date to receive
     interest due on the relevant interest payment date);

          (ii) the circumstances and relevant facts and financial information
     regarding such Change of Control;

          (iii) the repurchase date (which shall be no earlier than 30 days nor
     later than 60 days from the date such notice is mailed); and

          (iv) the instructions determined by the Company, consistent with this
     Section, that a Holder must follow in order to have its Securities
     purchased.

          (c) Holders electing to have a Security purchased shall be required to
surrender the Security, with an appropriate form duly completed, to the Company
at the address specified in the notice at least three Business Days prior to the
purchase date. Holders shall be entitled to withdraw their election if the
Trustee or the Company receives not later than one Business Day prior to the
purchase date a telegram, telex, facsimile transmission or letter setting forth
the name of the Holder, the principal amount of the Security which was delivered
for purchase by the Holder and a statement that such Holder is withdrawing his
election to have such Security purchased. Holders whose Securities are purchased
only in part shall be issued new Securities equal in principal amount to the
unpurchased portion of the Securities surrendered.

          (d) On the purchase date, all Securities purchased by the Company
under this Section shall be delivered to the Trustee for cancelation, and the
Company shall pay the purchase price plus accrued and unpaid interest, including
Additional Interest, if any, to the Holders entitled thereto.

          (e) Notwithstanding the foregoing provisions of this Section, the
Company shall not be required to make a Change of Control Offer upon a Change of
Control if a third party makes the Change of Control Offer in the manner, at the
times and otherwise in compliance with the requirements set forth in Section
4.08(b) applicable to a



                                                                              62

Change of Control Offer made by the Company and purchases all Securities validly
tendered and not withdrawn under such Change of Control Offer.

          (f) At the time the Company delivers Securities to the Trustee which
are to be accepted for purchase, the Company shall also deliver an Officers'
Certificate stating that such Securities are to be accepted by the Company
pursuant to and in accordance with the terms of this Section 4.08. A Security
shall be deemed to have been accepted for purchase at the time the Trustee,
directly or through an agent, mails or delivers payment therefor to the
surrendering Holder.

          (g) Prior to any Change of Control Offer, the Company shall deliver to
the Trustee an Officers' Certificate stating that all conditions precedent
contained herein to the right of the Company to make such offer have been
complied with.

          (h) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Securities pursuant to this
Section. To the extent that the provisions of any securities laws or regulations
conflict with provisions of this Section, the Company shall comply with the
applicable securities laws and regulations and shall not be deemed to have
breached its obligations under this Section by virtue thereof.

          For all purposes under this Indenture, including Article VI and
Section 9.02 hereof, holders of Non-Consenting Securities shall not have the
benefit of the terms and provisions of this Section 4.08.

          SECTION 4.09. COMPLIANCE CERTIFICATE. The Company shall deliver to the
Trustee within 120 days after the end of each fiscal year of the Company an
Officers' Certificate (which certificate may be the same certificate required by
TIA Section 314(a)(4)) stating that in the course of the performance by the
signers of their duties as Officers of the Company they would normally have
knowledge of any Default and whether or not the signers know of any Default that
occurred during such period. If they do, the certificate shall describe the
Default, its status and what action the Company is taking or proposes to take
with respect thereto. The Company also shall comply with TIA Section 314(a)(4).

          SECTION 4.10. FURTHER INSTRUMENTS AND ACTS. Upon request of the
Trustee, the Company shall execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.

          SECTION 4.11. FUTURE NOTE GUARANTORS AND LIENS. If, after the Closing
Date, any domestic Restricted Subsidiary shall be formed or acquired, or if any
Foreign Subsidiary shall guarantee any Indebtedness of the Company or any
domestic subsidiary, then, in either case, the Company shall, at the time, cause
such Subsidiary to (a) execute a supplemental indenture substantially in the
form set forth in Exhibit C hereto pursuant to which such Restricted Subsidiary
will Guarantee payment of the Securities, (b) execute counterparts of the
Security Documents, subject to the Intercreditor Agreement, that grant



                                                                              63

the Trustee a first-priority Lien for the benefit of the Holders on all
First-Priority Assets owned by such Subsidiary, subject to the terms of the
Security Documents, (c) if such Subsidiary grants any Lien upon any of its
property constituting Second-Priority Collateral as security for any Credit
Agreement Obligations or any Secondary Collateral Obligations, execute a
Security Document upon substantially the same terms, but subject to the
Intercreditor Agreement, that grants the Trustee a second-priority Lien upon
such property for the benefit of the Holders, subject to the terms of such
Security Document, (d) in the case of clauses (b) and (c), take all such actions
(including the filing and recording of financing statements, fixture filings,
Mortgages and other documents) that may be required under any applicable law, or
which the Trustee may reasonably request, to create and perfect such Lien, all
at the expense of the Company and the Note Guarantors, including all reasonable
fees and expenses of counsel incurred by the Trustee in connection therewith,
and (e) deliver to the Trustee an Opinion of Counsel, reasonably satisfactory to
the Trustee, that such supplemental indenture and any such Security Documents,
as the case may be, are valid and binding obligations of such Subsidiary
enforceable against such Subsidiary in accordance with their terms, subject to
customary exceptions, including exceptions for bankruptcy, fraudulent conveyance
and equitable principles. Notwithstanding the foregoing, if granting the Lien
described in clause (b) above is not permitted in any respect by the terms of
any encumbrance or restriction described in Section 4.05(d), the Subsidiary will
not be required to grant such Lien to the extent not so permitted. Further, if
granting the Lien described in clause (c) above requires the consent of a third
party, such Subsidiary will use commercially reasonable efforts to obtain such
consent with respect to the second-priority Lien, for the benefit of the
Trustee, but if the third party does not consent to the granting of the
second-priority Lien, after the use of commercially reasonable efforts, such
Subsidiary will not be required to do so. Also, if a Lien described in clause
(b) or (c) cannot be granted or perfected under applicable law, the Subsidiary
will not be required to grant such Lien.

          From and after the Closing Date, if the Company or any Note Guarantor
creates any additional security interest (other than Permitted Liens described
in clauses (b)-(aa) of the definition thereof) upon any Second-Priority
Collateral to secure any Credit Agreement Obligations or any Secondary
Collateral Obligations, it shall concurrently grant a second-priority Lien
(subject to Permitted Liens) upon such property as security for the Securities
ratably with any other Secondary Collateral Obligations to be secured thereby by
(i) executing Security Documents that grant the Trustee a second-priority Lien
upon such property for the benefit of the Holders upon substantially the same
terms as those that create such additional security interests, but subject to
the Intercreditor Agreement, and (ii) take all such actions (including the
filing and recording of financing statements, fixture filings, Mortgages and
other documents) that may be required under any applicable law, or which the
Trustee may reasonably request to create and perfect such second-priority Lien,
all at the expense of the Company and the Note Guarantors, including all
reasonable fees and expenses of counsel incurred by the Trustee in connection
therewith; PROVIDED that the Company or such Note Guarantor shall not be
required to grant a second-priority Lien upon such property as security for the
Securities if (x) a second-priority Lien in such property cannot be granted or
perfected under applicable law or (y) such grant requires the consent of any
third party, which consent the



                                                                              64

Company or such Note Guarantor is unable to obtain using commercially reasonable
efforts.

          In addition, the Company and each Note Guarantor shall, with respect
to each parcel of real property in the United States acquired by the Company or
any Note Guarantor after the Closing Date, use commercially reasonable efforts
to deliver to the Collateral Agent, for the benefit of or addressed to the
Trustee or the Collateral Agent, as applicable, the following:

          (a) a fully executed, acknowledged, and recorded Mortgage similar to
those provided for the benefit of the Collateral Agent on the Original Issue
Date and subject to the terms of the Intercreditor Agreement;

          (b) an opinion of local counsel in a form substantially similar to
those provided for the benefit of the Collateral Agent on the Original Issue
Date, or otherwise reasonably acceptable to the Trustee;

          (c) a fully-paid title insurance policy in a form substantially
similar to the title insurance policies delivered to the Collateral Agent on the
Original Issue Date with no exceptions other than (i) Permitted Liens and (ii)
other changes reasonably acceptable to the Trustee; and

          (d) the most recent survey of each property together with either (i)
an updated survey certification from the applicable surveyor stating that, based
on a visual inspection of the property and the knowledge of the surveyor, there
has been no change in the facts depicted in the survey or (ii) an affidavit from
the Company and the Note Guarantors stating that there has been no change, other
than, in each case, changes reasonably acceptable to the Trustee, in the facts
depicted in the survey.

          The Company shall provide each of the foregoing described in clauses
(a) through (d) above at its own expense and shall pay all reasonable fees and
expenses of counsel incurred by the Trustee in connection with each of the
foregoing.

          SECTION 4.12. LIMITATION ON LINES OF BUSINESS. The Company shall not,
and shall not permit any Restricted Subsidiary to, engage in any business, other
than a Permitted Business, except that the Company and any of its Restricted
Subsidiaries may engage in a new business so long as the Company and its
Restricted Subsidiaries, taken as a whole, remain substantially engaged in a
Permitted Business.

          For all purposes under this Indenture, including Article VI and
Section 9.02 hereof, holders of Non-Consenting Securities shall not have the
benefit of the terms and provisions of this Section 4.12.

          SECTION 4.13. LIMITATION ON LIENS. The Company shall not, and shall
not permit any of its Restricted Subsidiaries to, directly or indirectly,
create, incur, assume or suffer to exist any Lien of any kind on any asset now
owned or hereafter acquired by the Company or its Restricted Subsidiaries,
except Permitted Liens.



                                                                              65

          For all purposes under this Indenture, including Article VI and
Section 9.02 hereof, holders of Non-Consenting Securities shall not have the
benefit of the terms and provisions of this Section 4.13.

          SECTION 4.14. MATERIAL AFTER-ACQUIRED PROPERTY. Upon the acquisition
by the Company or any Note Guarantor of any Material After-Acquired Property (or
the formation or acquisition of any Note Guarantor that holds Material
After-Acquired Property), the Company or such Note Guarantor shall execute and
deliver such mortgages, deeds of trust, security instruments, financing
statements and certificates and opinions of counsel as shall be reasonably
necessary or requested by the Trustee to vest in the Trustee a perfected
first-priority security interest (subject to Permitted Liens) in such Material
After-Acquired Property and to have such Material After-Acquired Property added
to the First-Priority Collateral, and thereupon all provisions of this Indenture
relating to First-Priority Collateral shall be deemed to relate to such Material
After-Acquired Property to the same extent and with the same force and effect.

                                    ARTICLE V

                                SUCCESSOR COMPANY

          SECTION 5.01. WHEN COMPANY MAY MERGE OR TRANSFER ASSETS. (a) The
Company shall not consolidate with or merge with or into, or convey, transfer or
lease all or substantially all its assets to, any Person, unless:

          (i) the resulting, surviving or transferee Person (the "Successor
     Company") shall be a corporation organized and existing under the laws of
     the United States of America, any State thereof or the District of Columbia
     and the Successor Company (if not the Company) shall expressly assume, by a
     supplemental indenture hereto, executed and delivered to the Trustee, in
     form satisfactory to the Trustee, all the obligations of the Company under
     the Securities and this Indenture;

          (ii) immediately after giving effect to such transaction (and treating
     any Indebtedness which becomes an obligation of the Successor Company or
     any Restricted Subsidiary as a result of such transaction as having been
     Incurred by the Successor Company or such Restricted Subsidiary at the time
     of such transaction), no Default shall have occurred and be continuing;

          (iii) immediately after giving effect to such transaction, the
     Successor Company would be able to Incur an additional $1.00 of
     Indebtedness pursuant to Section 4.03(a); and

          (iv) the Company shall have delivered to the Trustee an Officers'
     Certificate and an Opinion of Counsel, each stating that such
     consolidation, merger or transfer and such supplemental indenture (if any)
     comply with this Indenture.



                                                                              66

          The Successor Company shall succeed to, and be substituted for, and
may exercise every right and power of, the Company under this Indenture, but the
predecessor Company in the case of a conveyance, transfer or lease of all or
substantially all its assets shall not be released from the obligation to pay
the principal of and interest on the Securities.

          For all purposes under this Indenture, including Article VI and
Section 9.02 hereof, holders of Non-Consenting Securities shall not have the
benefit of the terms and provisions of clause (iii) of this Section 5.01(a).

          (b) The Company shall not permit any Note Guarantor to consolidate
with or merge with or into, or convey, transfer or lease all or substantially
all its assets to, any Person, unless either:

          (i) (1) the resulting, surviving or transferee Person will be a
     corporation, partnership or limited liability company organized and
     existing under the laws of the United States of America, any State thereof
     or the District of Columbia, and such Person (if not such Note Guarantor)
     shall expressly assume, by a supplemental indenture, executed and delivered
     to the Trustee, in form satisfactory to the Trustee, all the obligations of
     such Note Guarantor under its Note Guarantee; (2) immediately after giving
     effect to such transaction (and treating any Indebtedness which becomes an
     obligation of the resulting, surviving or transferee Person or any
     Restricted Subsidiary as a result of such transaction as having been
     Incurred by such Person or such Restricted Subsidiary at the time of such
     transaction), no Default shall have occurred and be continuing; and (3) the
     Company shall have delivered to the Trustee an Officers' Certificate and an
     Opinion of Counsel, each stating that such consolidation, merger or
     transfer and such supplemental indenture (if any) comply with this
     Indenture; or

          (ii) such transaction results in the Company receiving cash or other
     property (other than Capital Stock representing a controlling interest in
     the successor entity), and the transaction is made in compliance with
     Section 4.06.

          (c) Notwithstanding the foregoing, (i) any Restricted Subsidiary may
consolidate with, merge into or transfer or lease all or part of its properties
and assets to the Company or a Subsidiary that is a Note Guarantor and (ii) the
Company may merge with an Affiliate incorporated solely for (1) the purpose of
incorporating the Company or (2) organizing the Company in another jurisdiction
to realize tax or other benefits.



                                                                              67

                                   ARTICLE VI

                              DEFAULTS AND REMEDIES

          SECTION 6.01. EVENTS OF DEFAULT. An "Event of Default" occurs if:

          (a) the Company defaults in any payment of interest on any Security or
in any payment of Additional Interest, in each case, when the same becomes due
and payable and such default continues for a period of 30 days;

          (b) the Company (i) defaults in the payment of Accreted Value or the
principal of any Security when the same becomes due and payable at its Stated
Maturity, upon required redemption or repurchase, upon declaration or otherwise
or (ii) fails to redeem or purchase Securities when required pursuant to this
Indenture or the Securities;

          (c) the Company or any Note Guarantor fails to comply with Section
5.01; provided that the failure to comply with Section 5.01(a)(iii) shall not
constitute a Default or an Event of Default with respect to any Non-Consenting
Securities and all Non-Consenting Securities shall be excluded from any
calculation of outstanding Securities for purposes of delivering notices of
default or acceleration, rescinding any prior acceleration, waiving an existing
Default or pursuing any other remedies related thereto;

          (d) the Company or any Restricted Subsidiary fails to comply with
Section 4.02, 4.03, 4.04, 4.05, 4.06, 4.07, 4.08, 4.11, 4.12, 4.13, or 4.14
(other than a failure to purchase Securities when required under Section 4.06 or
4.08) and such failure continues for 45 days after the written notice specified
below; provided that the failure to comply with Section 4.02, 4.03, 4.04, 4.05,
4.06, 4.07, 4.08, 4.12 and 4.13 shall not constitute a Default or an Event of
Default with respect to any Non-Consenting Securities and any such
Non-Consenting Securities shall be excluded from any calculation of outstanding
Securities for purposes of delivering notices of default or acceleration,
rescinding any prior acceleration, waiving an existing Default or pursuing any
other remedies related thereto;

          (e) the Company or any Restricted Subsidiary fails to comply with any
of its agreements in the Securities, this Indenture or any Security Document
(other than those referred to in (a), (b), (c) or (d) above) and such failure
continues for 60 days after the written notice specified below;

          (f) the principal amount of any Indebtedness of the Company or any
Restricted Subsidiary is not paid within any applicable grace period after final
maturity or the acceleration by the holders thereof because of a default and the
aggregate principal amount of such Indebtedness unpaid or accelerated exceeds
$10.0 million or its foreign currency equivalent at the time and such failure
continues for 30 days after the written notice specified below;



                                                                              68

          (g) the Company or any Significant Subsidiary pursuant to or within
the meaning of any Bankruptcy Law:

          (i) commences a voluntary case;

          (ii) consents to the entry of an order for relief against it in an
     involuntary case;

          (iii) consents to the appointment of a Custodian of it or for any
     substantial part of its property; or

          (iv) makes a general assignment for the benefit of its creditors; or
     takes any comparable action under any foreign laws relating to insolvency;

          (h) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:

          (i) is for relief against the Company or any Significant Subsidiary in
     an involuntary case;

          (ii) appoints a Custodian of the Company or any Significant Subsidiary
     or for any substantial part of its property; or

          (iii) orders the winding up or liquidation of the Company or any
     Significant Subsidiary;

or any similar relief is granted under any foreign laws and the order or
decree remains unstayed and in effect for 60 days;

          (i) any judgment or decree for the payment of money in excess of $10.0
million (net of any amounts with respect to which a reputable and creditworthy
insurance company has acknowledged liability in writing) or its foreign currency
equivalent against the Company or a Restricted Subsidiary if such judgment or
decree becomes final and nonappealable and remains outstanding for a period of
60 days following such judgment and is not discharged, waived or the execution
thereof stayed; or

          (j) (1) any Note Guarantee, or any Security Document executed by, or
any security interest granted thereunder by a Note Guarantor that is a Material
Subsidiary ceases to be in full force and effect (except as contemplated by the
terms of this Indenture, the Security Documents, the Intercreditor Agreement or
the Note Guarantees), except (i) as a result of (A) the Credit Agent's or
Trustee's failure to take any action reasonably requested by the Company in
order to maintain a valid and perfected Lien on any Collateral or (B) any action
taken by the Credit Agent or Trustee to release any Lien on any Collateral or
(ii) Liens on any item of Collateral with a fair market value not exceeding
$500,000, (2) any Note Guarantor or Person acting by or on behalf of such Note
Guarantor denies or disaffirms its obligations under this Indenture, any Note
Guarantee or any Security Document and, in each case, such Default continues for



                                                                              69

10 days after the written notice specified below or (3) the Intercreditor
Agreement ceases to be in full force and effect (except as contemplated
hereunder or by the terms of the Security Documents, the Intercreditor Agreement
or the Note Guarantees).

          The foregoing shall constitute Events of Default whatever the reason
for any such Event of Default and whether it is voluntary or involuntary or is
effected by operation of law or pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body.

          The term "Bankruptcy Law" means Title 11, UNITED STATES CODE, or any
similar Federal or state law for the relief of debtors. The term "Custodian"
means any receiver, trustee, assignee, liquidator, custodian or similar official
under any Bankruptcy Law.

          A Default under clause (d), (e), (f) or (j) above is not an Event of
Default until the Trustee or the Holders of at least 25% in principal amount of
the outstanding Securities notify the Company of the Default and the Company or
the Note Guarantor, as applicable, does not cure such Default within the time
specified after receipt of such notice. Such notice must specify the Default,
demand that it be remedied and state that such notice is a "Notice of Default".

          The Company shall deliver to the Trustee, within 30 days after the
occurrence thereof, written notice in the form of an Officers' Certificate of
any event which is, or with the giving of notice or the lapse of time or both
would become, an Event of Default, its status and what action the Company is
taking or proposes to take with respect thereto.

          SECTION 6.02. ACCELERATION. If an Event of Default (other than an
Event of Default specified in Section 6.01(g) or (h) with respect to the
Company) occurs and is continuing, the Trustee or the Holders of at least 25% in
principal amount of the outstanding Securities by written notice (specifying the
Event of Default and stating that the notice is a "notice of acceleration") to
the Company and the Trustee may declare the principal of and accrued but unpaid
interest, including Additional Interest, if any, on all the Securities to be due
and payable. Upon such a declaration, such principal and interest (including
Additional Interest, if any) shall be due and payable immediately. If an Event
of Default specified in Section 6.01(g) or (h) with respect to the Company
occurs, the principal of and interest (including Additional Interest, if any) on
all the Securities shall IPSO FACTO become and be immediately due and payable
without any declaration or other act on the part of the Trustee or any Holders
and if such Event of Default occurs prior to the earlier of (i) the Cash
Election Date and (ii) December 15, 2006, the Company will thereafter be
obligated to pay cash interest on any Non-Consenting Securities on each
subsequent interest payment date and the Non-Consenting Securities will cease to
accrete. The Holders of a majority in principal amount of the Securities by
notice to the Trustee may rescind an acceleration and its consequences if the
rescission would not conflict with any judgment or decree and if all existing
Events of Default have been cured or waived except nonpayment of principal or
interest that has become due solely



                                                                              70

because of acceleration. No such rescission shall affect any subsequent Default
or impair any right consequent thereto.

          SECTION 6.03. OTHER REMEDIES. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy to collect the payment
of principal of or interest on the Securities or to enforce the performance of
any provision of the Securities or this Indenture.

          The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder in exercising any right or remedy accruing
upon an Event of Default shall not impair the right or remedy or constitute a
waiver of or acquiescence in the Event of Default. No remedy is exclusive of any
other remedy. All available remedies are cumulative.

          SECTION 6.04. WAIVER OF PAST DEFAULTS. The Holders of a majority in
principal amount of the Securities by notice to the Trustee may waive an
existing Default and its consequences except (a) a Default in the payment of the
principal of or interest on a Security, (b) a Default arising from the failure
to redeem or purchase any Security when required pursuant to the terms of this
Indenture or (c) a Default in respect of a provision that under Section 9.02
cannot be amended without the consent of each Holder affected. When a Default is
waived, it is deemed cured, but no such waiver shall extend to any subsequent or
other Default or impair any consequent right.

          SECTION 6.05. CONTROL BY MAJORITY. The Holders of a majority in
principal amount of the Securities may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or of
exercising any trust or power conferred on the Trustee. However, the Trustee may
refuse to follow any direction that conflicts with law or this Indenture or,
subject to Section 7.01, that the Trustee determines is unduly prejudicial to
the rights of other Holders or would involve the Trustee in personal liability;
PROVIDED, HOWEVER, that the Trustee may take any other action deemed proper by
the Trustee that is not inconsistent with such direction. Prior to taking any
action hereunder, the Trustee shall be entitled to indemnification satisfactory
to it in its sole discretion against all losses and expenses caused by taking or
not taking such action.

          SECTION 6.06. LIMITATION ON SUITS. (a) Except to enforce the right to
receive payment of principal, premium (if any) or interest when due, no Holder
may pursue any remedy with respect to this Indenture or the Securities unless:

          (i) the Holder gives to the Trustee written notice stating that an
     Event of Default is continuing;

          (ii) the Holders of at least 25% in principal amount of the Securities
     make a written request to the Trustee to pursue the remedy;

          (iii) such Holder or Holders offer to the Trustee reasonable security
     or indemnity against any loss, liability or expense;



                                                                              71

          (iv) the Trustee does not comply with the request within 60 days after
     receipt of the request and the offer of security or indemnity; and

          (v) the Holders of a majority in principal amount of the Securities do
     not give the Trustee a direction inconsistent with the request during such
     60-day period.

          (b) A Holder may not use this Indenture to prejudice the rights of
another Holder or to obtain a preference or priority over another Holder.

          SECTION 6.07. RIGHTS OF HOLDERS TO RECEIVE PAYMENT. Notwithstanding
any other provision of this Indenture, the right of any Holder to receive
payment of principal of and interest, including Additional Interest, if any, on
the Securities held by such Holder, on or after the respective due dates
expressed or provided for in the Securities, or to bring suit for the
enforcement of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of such Holder.

          SECTION 6.08. COLLECTION SUIT BY TRUSTEE. If an Event of Default
specified in Section 6.01(a) or (b) occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Company or any other obligor on the Securities for the whole amount then due and
owing (together with interest on overdue principal and (to the extent lawful) on
any unpaid interest at the rate provided for in the Securities) and the amounts
provided for in Section 7.07.

          SECTION 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM. The Trustee may file
such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee and the Holders allowed in
any judicial proceedings relative to the Company, any Subsidiary or Note
Guarantor, their creditors or their property and, unless prohibited by law or
applicable regulations, may vote on behalf of the Holders in any election of a
trustee in bankruptcy or other Person performing similar functions, and any
Custodian in any such judicial proceeding is hereby authorized by each Holder to
make payments to the Trustee and, in the event that the Trustee shall consent to
the making of such payments directly to the Holders, to pay to the Trustee any
amount due it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and its counsel, and any other amounts due
the Trustee under Section 7.07.

          SECTION 6.10. PRIORITIES. Subject to the terms of the Intercreditor
Agreement, if the Trustee collects any money or property pursuant to this
Article 6, it shall pay out the money or property in the following order:

          FIRST: to the Trustee for amounts due under Section 7.07;

          SECOND: to Holders for amounts due and unpaid on the Securities for
     principal and interest ratably and any Additional Interest, without
     preference or priority of any kind, according to the amounts due and
     payable on the Securities for principal and interest, including any
     Additional Interest, respectively; and



                                                                              72

          THIRD: to the Company.

          The Trustee may fix a record date and payment date for any payment to
Holders pursuant to this Section. At least 15 days before such record date, the
Trustee shall mail to each Holder and the Company a notice that states the
record date, the payment date and amount to be paid.

          SECTION 6.11. UNDERTAKING FOR COSTS. In any suit for the enforcement
of any right or remedy under this Indenture or in any suit against the Trustee
for any action taken or omitted by it as Trustee, a court in its discretion may
require the filing by any party litigant in the suit of an undertaking to pay
the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees and expenses, against any party
litigant in the suit, having due regard to the merits and good faith of the
claims or defenses made by the party litigant. This Section does not apply to a
suit by the Trustee, a suit by a Holder pursuant to Section 6.07 or a suit by
Holders of more than 10% in principal amount of the Securities.

          SECTION 6.12. WAIVER OF STAY OR EXTENSION LAWS. Neither the Company
nor any Note Guarantor (to the extent it may lawfully do so) shall at any time
insist upon, or plead, or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereafter in force, which may affect the covenants or the performance of this
Indenture; and the Company and each Note Guarantor (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and shall not hinder, delay or impede the execution of any power herein
granted to the Trustee, but shall suffer and permit the execution of every such
power as though no such law had been enacted.

                                   ARTICLE VII

                                     TRUSTEE

          SECTION 7.01. DUTIES OF TRUSTEE. (a) If an Event of Default has
occurred and is continuing, the Trustee shall exercise the rights and powers
vested in it by this Indenture and use the same degree of care and skill in
their exercise as a prudent person would exercise or use under the circumstances
in the conduct of such person's own affairs.

          (b)  Except during the continuance of an Event of Default:

          (i) the Trustee undertakes to perform such duties and only such duties
     as are specifically set forth in this Indenture and no implied covenants or
     obligations shall be read into this Indenture against the Trustee; and

          (ii) in the absence of bad faith on its part, the Trustee may
     conclusively rely, as to the truth of the statements and the correctness of
     the opinions expressed therein, upon certificates or opinions furnished to
     the Trustee and conforming to the requirements of this Indenture. However,
     with respect to any certificate or



                                                                              73

     opinions required to be furnished to it hereunder, the Trustee shall
     examine the certificates and opinions to determine whether or not they
     conform to the requirements of this Indenture (but need not confirm or
     investigate the accuracy of mathematical calculations or other facts stated
     therein).

          (c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:

          (i) this paragraph does not limit the effect of paragraph (b) of this
     Section;

          (ii) the Trustee shall not be liable for any error of judgment made in
     good faith by a Trust Officer unless it is proved that the Trustee was
     negligent in ascertaining the pertinent facts; and

          (iii) the Trustee shall not be liable with respect to any action it
     takes or omits to take in good faith in accordance with a direction
     received by it pursuant to Section 6.05.

          (iv) No provision of this Indenture shall require the Trustee to
     expend or risk its own funds or otherwise incur financial liability in the
     performance of any of its duties hereunder or in the exercise of any of its
     rights or powers, if it shall have reasonable grounds to believe that
     repayment of such funds or adequate indemnity against such risk or
     liability is not reasonably assured to it.

          (d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b) and (c) of this Section.

          (e) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company.

          (f) Money held in trust by the Trustee need not be segregated from
other funds except to the extent required by law.

          (g) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section and to the provisions of the TIA.

          SECTION 7.02. RIGHTS OF TRUSTEE. (a) The Trustee may conclusively rely
on any document (whether in its original or facsimile form) believed by it to be
genuine and to have been signed or presented by the proper person. The Trustee
need not investigate any fact or matter stated in the document.

          (b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel. The Trustee shall not be liable
for any action it takes or omits to take in good faith in reliance on the
Officers' Certificate or Opinion of Counsel.



                                                                              74

          (c) The Trustee may act through agents and shall not be responsible
for the misconduct or negligence of any agent appointed with due care.

          (d) The Trustee shall not be liable for any action it takes or omits
to take in good faith which it believes to be authorized or within its rights or
powers; PROVIDED, HOWEVER, that the Trustee's conduct does not constitute
willful misconduct or negligence.

          (e) The Trustee may consult with counsel of its selection, and the
advice or opinion of such counsel with respect to legal matters relating to this
Indenture and the Securities shall be full and complete authorization and
protection from liability in respect of any action taken, omitted or suffered by
it hereunder in good faith and in accordance with the advice or opinion of such
counsel.

          (f) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond, debenture,
note or other paper or document unless requested in writing to do so by the
Holders of not less than a majority in principal amount of the Securities at the
time outstanding, but the Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit, and, if
the Trustee shall determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises of the Company,
personally or by agent or attorney at the Company's expense and shall incur no
liability or additional liability of any kind by reason of such inquiry or
investigation.

          (g) The rights, privileges, protections, immunities and benefits given
to the Trustee, including, without limitation, its right to be indemnified, are
extended to, and shall be enforceable by, the Trustee in each of its capacities
hereunder, and to each agent, custodian and other Person employed to act
hereunder.

          (h) The Trustee may request that the Company deliver a certificate
setting forth the names of individuals and/or titles of officers authorized at
such time to take specified actions pursuant to this Indenture, which Officers'
Certificate may be signed by any person authorized to sign an Officers'
Certificate, including any person specified as so authorized in any certificate
previously delivered and not superseded.

          (i) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders pursuant to this Indenture, unless such Holders shall have
offered to the Trustee security or indemnity reasonably satisfactory to the
Trustee against the costs, expenses and liabilities which might be incurred by
it in compliance with such request or direction.

          SECTION 7.03. INDIVIDUAL RIGHTS OF TRUSTEE. The Trustee in its
individual or any other capacity may become the owner or pledgee of Securities
and may otherwise deal with the Company or its Affiliates with the same rights
it would have if it were not Trustee. Any Paying Agent or Registrar may do the
same with like rights. However, the Trustee must comply with Sections 7.10 and
7.11.



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          SECTION 7.04. TRUSTEE'S DISCLAIMER. The Trustee shall not be
responsible for and makes no representation as to the validity or adequacy of
this Indenture, any Note Guarantee or the Securities, it shall not be
accountable for the Company's use of the proceeds from the Securities, and it
shall not be responsible for any statement of the Company or any Note Guarantor
in this Indenture or in any document issued in connection with the sale of the
Securities or in the Securities other than the Trustee's certificate of
authentication. The Trustee shall not be charged with knowledge of any Default
or Event of Default under Sections 6.01(c), (d), (e), (f), (i) or (j) or of the
identity of any Significant Subsidiary unless either (a) a Trust Officer shall
have actual knowledge thereof or (b) the Trustee shall have received notice
thereof in accordance with Section 12.02 hereof from the Company, any Note
Guarantor or any Holder at the Corporate Trust Office of the Trustee, such
notice referencing the Securities and this Indenture.

          SECTION 7.05. NOTICE OF DEFAULTS. If a Default occurs and is
continuing and if it is known to the Trustee, the Trustee shall mail to each
Holder notice of the Default within the earlier of 90 days after it occurs or 30
days after it is actually known to a Trust Officer or written notice of it is
received by the Trustee. Except in the case of a Default in payment of principal
of, premium (if any) or interest on any Security (including payments pursuant to
the mandatory redemption provisions of such Security, if any), the Trustee may
withhold the notice if and so long as a committee of its Trust Officers in good
faith determines that withholding the notice is in the interests of Holders.

          SECTION 7.06. REPORTS BY TRUSTEE TO HOLDERS. As promptly as
practicable after each May 15 beginning with May 15, 2004, and in any event
prior to July 15 in each year, the Trustee shall mail to each Holder a brief
report dated as of such May 15 that complies with TIA Section 313(a) if and to
the extent required thereby. The Trustee shall also comply with TIA Section
313(b) and 313(c).

          A copy of each report at the time of its mailing to Holders shall be
filed with the SEC and each stock exchange (if any) on which the Securities are
listed. The Company agrees to notify promptly the Trustee whenever the
Securities become listed on any stock exchange and of any delisting thereof.

          SECTION 7.07. COMPENSATION AND INDEMNITY. The Company shall pay to the
Trustee from time to time reasonable compensation for its services as shall be
agreed to in writing from time to time by the Company and the Trustee. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the Trustee upon
request for all reasonable out-of-pocket expenses incurred or made by it,
including costs of collection, in addition to the compensation for its services.
Such expenses shall include the reasonable compensation and expenses,
disbursements and advances of the Trustee's agents, counsel, accountants and
experts. The Company and each Note Guarantor, jointly and severally, shall
indemnify the Trustee and any predecessor Trustee against any and all loss,
liability, claim, damage or expense (including reasonable attorneys' fees),
including taxes (other than taxes based upon, measured by or determined by the
income of the Trustee),



                                                                              76

incurred by or in connection with the administration of this trust and the
performance of its duties hereunder, including its duties as Collateral Agent.
The Trustee shall notify the Company of any claim for which it may seek
indemnity promptly upon obtaining actual knowledge thereof; PROVIDED, HOWEVER,
that any failure so to notify the Company shall not relieve the Company or any
Note Guarantor of its indemnity obligations hereunder. The Company shall defend
the claim and the indemnified party shall provide reasonable cooperation at the
Company's expense in the defense. Such indemnified parties may have separate
counsel and the Company and the Note Guarantors, as applicable shall pay the
fees and expenses of such counsel; PROVIDED, HOWEVER, that the Company shall not
be required to pay such fees and expenses if it assumes such indemnified
parties' defense and, in such indemnified parties' reasonable judgment, there is
no conflict of interest between the Company and the Note Guarantors, as
applicable, and such parties in connection with such defense. The Company need
not reimburse any expense or indemnify against any loss, liability or expense
incurred by an indemnified party through such party's own willful misconduct,
negligence or bad faith or in the case of the Collateral Agent, through its own
willful misconduct, gross negligence or bad faith.

          To secure the Company's payment obligations in this Section, the
Trustee shall have a lien prior to the Securities on all money or property held
or collected by the Trustee other than money or property held in trust to pay
principal of, interest and Additional Interest, if any, and premium, if any, on
particular Securities.

          The Company's payment obligations pursuant to this Section shall
survive the satisfaction or discharge of this Indenture, any rejection or
termination of this Indenture under any bankruptcy law or the resignation or
removal of the Trustee. Without prejudice to any other rights available to the
Trustee under applicable law, when the Trustee incurs expenses after the
occurrence of a Default specified in Section 6.01(g) or (h) with respect to the
Company, the expenses are intended to constitute expenses of administration
under the Bankruptcy Law.

          SECTION 7.08. REPLACEMENT OF TRUSTEE. (a) The Trustee may resign at
any time by so notifying the Company. The Holders of a majority in principal
amount of the Securities may remove the Trustee by so notifying the Trustee and
may appoint a successor Trustee. The Company shall remove the Trustee if:

          (i) the Trustee fails to comply with Section 7.10;

          (ii) the Trustee is adjudged bankrupt or insolvent;

          (iii) a receiver or other public officer takes charge of the Trustee
     or its property; or

          (iv) the Trustee otherwise becomes incapable of acting.

          (b) If the Trustee resigns, is removed by the Company or by the
Holders of a majority in principal amount of the Securities and such Holders do
not reasonably promptly appoint a successor Trustee, or if a vacancy exists in
the office of Trustee for



                                                                              77

any reason (the Trustee in such event being referred to herein as the retiring
Trustee), the Company shall promptly appoint a successor Trustee.

          (c) A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders. The retiring Trustee shall promptly transfer all property
held by it as Trustee to the successor Trustee, subject to the lien provided for
in Section 7.07.

          (d) If a successor Trustee does not take office within 30 days after
the retiring Trustee resigns or is removed, the retiring Trustee or the Holders
of 10% in principal amount of the Securities may petition, at the expense of the
Company, any court of competent jurisdiction for the appointment of a successor
Trustee at the expense of the Company.

          (e) If the Trustee fails to comply with Section 7.10, unless the
Trustee's duty to resign is stayed as provided in TIA Section 310(b), any Holder
who has been a bona fide holder of a Security for at least six months may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.

          (f) Notwithstanding the replacement of the Trustee pursuant to this
Section, the Company's obligations under Section 7.07 shall continue for the
benefit of the retiring Trustee.

          SECTION 7.09. SUCCESSOR TRUSTEE BY MERGER. If the Trustee consolidates
with, merges or converts into, or transfers all or substantially all its
corporate trust business or assets to, another corporation or banking
association, the resulting, surviving or transferee corporation without any
further act shall be the successor Trustee.

          In case at the time such successor or successors by merger, conversion
or consolidation to the Trustee shall succeed to the trusts created by this
Indenture any of the Securities shall have been authenticated but not delivered,
any such successor to the Trustee may adopt the certificate of authentication of
any predecessor trustee, and deliver such Securities so authenticated; and in
case at that time any of the Securities shall not have been authenticated, any
successor to the Trustee may authenticate such Securities either in the name of
any predecessor hereunder or in the name of the successor to the Trustee; and in
all such cases such certificates shall have the full force which it is anywhere
in the Securities or in this Indenture provided that the certificate of the
Trustee shall have.

          SECTION 7.10. ELIGIBILITY; DISQUALIFICATION. The Trustee shall at all
times satisfy the requirements of TIA Section 310(a). The Trustee shall have a
combined capital and surplus of at least $50,000,000 as set forth in its most
recent published annual report of condition. The Trustee shall comply with TIA
Section 310(b); subject to its right to apply for a stay of its duty to resign
under the penultimate paragraph of TIA Section 310(b);



                                                                              78

PROVIDED, HOWEVER, that there shall be excluded from the operation of TIA
Section 310(b)(1) any indenture or indentures under which other securities or
certificates of interest or participation in other securities of the Company are
outstanding if the requirements for such exclusion set forth in TIA Section
310(b)(1) are met.

          SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST THE COMPANY.
The Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated.

                                  ARTICLE VIII

                       DISCHARGE OF INDENTURE; DEFEASANCE

          SECTION 8.01. DISCHARGE OF LIABILITY ON SECURITIES; DEFEASANCE. (a)
When (i) all outstanding Securities (other than Securities replaced or paid
pursuant to Section 2.08) have been canceled or delivered to the Trustee for
cancellation or (ii) all outstanding Securities have become due and payable,
whether at maturity or as a result of the mailing of a notice of redemption
pursuant to Article 3 hereof, and the Company irrevocably deposits with the
Trustee funds in an amount sufficient or U.S. Government Obligations, the
principal of and interest on which will be sufficient, or a combination thereof
sufficient, in the written opinion of a nationally recognized firm of
independent public accountants delivered to the Trustee (which delivery shall
only be required if U.S. Government Obligations have been so deposited), to pay
the principal of, premium (if any) and interest, and Additional Interest, if
any, on the outstanding Securities when due at maturity or upon redemption of,
including interest thereon to maturity or such redemption date (other than
Securities replaced or paid pursuant to Section 2.08) and Additional Interest,
if any, and if in the case of both clause (i) and (ii) the Company pays all
other sums payable hereunder by the Company, then this Indenture shall, subject
to Section 8.01(c), cease to be of further effect. The Trustee shall acknowledge
satisfaction and discharge of this Indenture on demand of the Company
accompanied by an Officers' Certificate and an Opinion of Counsel and at the
cost and expense of the Company.

          (b) Subject to Sections 8.01(c) and 8.02, the Company at any time may
terminate (i) all of its obligations under the Securities and this Indenture
("legal defeasance option") or (ii) its obligations under Sections 4.02, 4.03,
4.04, 4.05, 4.06, 4.07, 4.08, 4.11, 4.12, 4.13, 4.14 and 10.02 the operation of
Section 5.01(a)(iii), 6.01(d), 6.01(f), 6.01(g) (with respect to Significant
Subsidiaries of the Company only), 6.01(h) (with respect to Significant
Subsidiaries of the Company only) 6.01(i) and 6.01(j) ("covenant defeasance
option"). The Company may exercise its legal defeasance option notwithstanding
its prior exercise of its covenant defeasance option. In the event that the
Company terminates all of its obligations under the Securities and this
Indenture by exercising its legal defeasance option or its covenant defeasance
option, the obligations under the Note Guarantees shall each be terminated
simultaneously with the termination of such obligations.



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          If the Company exercises its legal defeasance option, payment of the
Securities may not be accelerated because of an Event of Default. If the Company
exercises its covenant defeasance option, payment of the Securities may not be
accelerated because of an Event of Default specified in Section 6.01(d),
6.01(f), 6.01(g) (with respect to Significant Subsidiaries only), 6.01(h) (with
respect to Significant Subsidiaries only), 6.01(i) or 6.01(j) or because of the
failure of the Company to comply with Section 5.01(a)(iii).

          Upon satisfaction of the conditions set forth herein and upon request
of the Company, the Trustee shall acknowledge in writing the discharge of those
obligations that the Company terminates.

          (c) Notwithstanding clauses (a) and (b) above, the Company's
obligations in Sections 2.04, 2.05, 2.06, 2.07, 2.08, 2.09, 7.07, 7.08, and in
this Article 8 shall survive until the Securities have been paid in full.
Thereafter, the Company's obligations in Sections 7.07, 8.04, 8.05, and 8.06
shall survive.

          SECTION 8.02. CONDITIONS TO DEFEASANCE. (a) The Company may exercise
its legal defeasance option or its covenant defeasance option only if:

          (i) the Company irrevocably deposits in trust with the Trustee money
     in an amount sufficient or U.S. Government Obligations, the principal of
     and interest on which will be sufficient, or a combination thereof
     sufficient, to pay the principal of, premium (if any) and interest, on the
     Securities when due at maturity or redemption, as the case may be,
     including interest thereon to maturity or such redemption date and
     Additional Interest (if any);

          (ii) the Company delivers to the Trustee a certificate from a
     nationally recognized firm of independent accountants expressing their
     opinion that the payments of principal and interest when due and without
     reinvestment on the deposited U.S. Government Obligations plus any
     deposited money without investment will provide cash at such times and in
     such amounts as will be sufficient to pay principal, premium, if any,
     interest and Additional Interest, if any, when due on all the Securities to
     maturity or redemption, as the case may be;

          (iii) 123 days pass after the deposit is made and during the 123-day
     period no Default specified in Section 6.01(g) or (h) with respect to the
     Company occurs which is continuing at the end of the period;

          (iv) the deposit does not constitute a default under any other
     agreement binding on the Company;

          (v) the Company delivers to the Trustee an Opinion of Counsel to the
     effect that the trust resulting from the deposit does not constitute, or is
     qualified as, a regulated investment company under the Investment Company
     Act of 1940;

          (vi) in the case of the legal defeasance option, the Company shall
     have delivered to the Trustee an Opinion of Counsel stating that (1) the
     Company has



                                                                              80

     received from, or there has been published by, the Internal Revenue Service
     a ruling, or (2) since the date of this Indenture there has been a change
     in the applicable Federal income tax law, in either case to the effect
     that, and based thereon such Opinion of Counsel shall confirm that, the
     Holders will not recognize income, gain or loss for Federal income tax
     purposes as a result of such deposit and legal defeasance and will be
     subject to Federal income tax on the same amounts, in the same manner and
     at the same times as would have been the case if such deposit and legal
     defeasance had not occurred;

          (vii) in the case of the covenant defeasance option, the Company shall
     have delivered to the Trustee an Opinion of Counsel to the effect that the
     Holders will not recognize income, gain or loss for Federal income tax
     purposes as a result of such deposit and covenant defeasance and will be
     subject to Federal income tax on the same amounts, in the same manner and
     at the same times as would have been the case if such deposit and covenant
     defeasance had not occurred; and

          (viii) the Company delivers to the Trustee an Officers' Certificate
     and an Opinion of Counsel, each stating that all conditions precedent to
     the defeasance and discharge of the Securities as contemplated by this
     Article 8 have been complied with.

          (b) Before or after a deposit, the Company may make arrangements
satisfactory to the Trustee for the redemption of Securities at a future date in
accordance with Article 3.

          (c) Notwithstanding the foregoing, the Opinion of Counsel required by
clause (vi) above need not be delivered if all Securities not theretofore
delivered to the Trustee for cancellation have become due and payable.

          SECTION 8.03. APPLICATION OF TRUST MONEY. The Trustee shall hold in
trust money or U.S. Government Obligations deposited with it pursuant to this
Article 8. It shall apply the deposited money and the money from U.S. Government
Obligations through the Paying Agent and in accordance with this Indenture to
the payment of principal of and interest and Additional Interest, if any, on the
Securities.

          SECTION 8.04. REPAYMENT TO COMPANY. The Trustee and the Paying Agent
shall promptly turn over to the Company upon request any money or U.S.
Government Obligations held by it as provided in this Article which, in the
written opinion of nationally recognized firm of independent public accountants
delivered to the Trustee (which delivery shall only be required if U.S.
Government Obligations have been so deposited), are in excess of the amount
thereof which would then be required to be deposited to effect an equivalent
discharge or defeasance in accordance with this Article.

          Subject to any applicable abandoned property law, the Trustee and the
Paying Agent shall pay to the Company upon written request any money held by
them for the payment of principal, interest and Additional Interest (if any)
that remains unclaimed for two years, and, thereafter, Holders entitled to the
money must look to the Company



                                                                              81

for payment as general creditors, and the Trustee and the Paying Agent shall
have no further liability with respect to such monies.

          SECTION 8.05. INDEMNITY FOR GOVERNMENT OBLIGATIONS. The Company shall
pay and shall indemnify the Trustee against any tax, fee or other charge imposed
on or assessed against deposited U.S. Government Obligations or the principal
and interest received on such U.S. Government Obligations.

          SECTION 8.06. REINSTATEMENT. If the Trustee or Paying Agent is unable
to apply any money or U.S. Government Obligations in accordance with this
Article 8 by reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, the Company's obligations under this
Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to this Article 8 until such time as the Trustee
or Paying Agent is permitted to apply all such money or U.S. Government
Obligations in accordance with this Article 8; PROVIDED, HOWEVER, that, if the
Company has made any payment of principal of or interest or Additional Interest,
if any, on, any Securities because of the reinstatement of its obligations, the
Company shall be subrogated to the rights of the Holders of such Securities to
receive such payment from the money or U.S. Government Obligations held by the
Trustee or Paying Agent.

                                   ARTICLE IX

                                   AMENDMENTS

          SECTION 9.01. WITHOUT CONSENT OF HOLDERS. (a) The Company, the Note
Guarantors and the Trustee may amend this Indenture, the Securities, the
Security Documents or the Intercreditor Agreement without notice to or consent
of any Holder:

          (i) to cure any ambiguity, omission, defect or inconsistency;

          (ii) to comply with Article 5;

          (iii) to provide for uncertificated Securities in addition to or in
     place of certificated Securities; PROVIDED, HOWEVER, that the
     uncertificated Securities are issued in registered form for purposes of
     Section 163(f) of the Code or in a manner such that the uncertificated
     Securities are described in Section 163(f)(2)(B) of the Code;

          (iv) to add additional Guarantees with respect to the Securities or to
     secure further the Securities;

          (v) to add to the covenants of the Company for the benefit of the
     Holders or to surrender any right or power herein conferred upon the
     Company;

          (vi) to comply with any requirement of the SEC in connection with
     qualifying, or maintaining the qualification of, this Indenture under the
     TIA;



                                                                              82

          (vii) to make any change that does not materially and adversely affect
     the rights of any Holder under the provisions of this Indenture;

          (viii) to provide for the issuance of the Exchange Notes, Private
     Exchange Notes, or the Additional Securities which shall have terms
     substantially identical in all material respects to the Consenting
     Securities (except that the transfer restrictions and Additional Interest
     provisions contained in the Consenting Securities shall be modified or
     eliminated, as appropriate), and which shall be treated, together with any
     outstanding Consenting Securities, as a single issue of securities; and

          (ix) if necessary, in connection with any addition or release of
     Collateral permitted under the terms of this Indenture or the Security
     Documents.

          The Company and the Note Guarantors shall also be entitled to other
releases of the Collateral or the Note Guarantees as described in Article 8 and
Sections 10.03, 10.07 and 11.03 hereof. If the Company wishes under other
circumstances to obtain an amendment or waiver or seek a consent under any
Security Document, any Note Guarantee or the Intercreditor Agreement, the
Company may mail written notice of its request to the Trustee and the Holders,
specifying the amendment, waiver or consent, the reason it is being sought and
any other information necessary for the Holders to reasonably consider such
matter. If the Company does not receive written objections from Holders of at
least 25% in aggregate principal amount of the Securities within 20 Business
Days after such mailing, such amendment, waiver or consent shall be deemed
granted. If the Company receives such objections, then it shall not be entitled
to effect such amendment or waiver, and such consent shall not be effective,
unless the Company obtains the consent of the Holders of a majority in
outstanding principal amount of the Securities (including any Additional
Securities) then outstanding voting as a single class (including consents
obtained in connection with a tender offer or exchange offer for, or purchase
of, the Securities). In addition, without the consent of any Holder, the Trustee
may amend the terms of the Intercreditor Agreement in order to subject the
security interests in the Collateral in respect of any Other First Priority
Obligations, Credit Agreement Obligations, Second Priority Obligations and
Secondary Collateral Obligations to the terms of the Intercreditor Agreement, in
each case to the extent such Indebtedness was Incurred, and all Liens on the
Collateral held for the benefit of such Indebtedness were granted, pursuant to
this Indenture and the Intercreditor Agreement.

          (b) After an amendment under this Section 9.01 becomes effective, the
Company shall mail to Holders a notice briefly describing such amendment. The
failure to give such notice to all Holders, or any defect therein, shall not
impair or affect the validity of an amendment under this Section 9.01.

          SECTION 9.02. WITH CONSENT OF HOLDERS. (a) The Company, the Note
Guarantors and the Trustee may amend this Indenture, the Securities, the
Security Documents or the Intercreditor Agreement without notice to any Holder
but with the written consent of the Holders of at least a majority in principal
amount of the Securities then outstanding (including consents obtained in
connection with a tender offer or



                                                                              83

exchange for, or purchase of, the Securities) and compliance with any provisions
of this Indenture may be waived with the written consent of the Holders of at
least a majority in principal amount of the Securities then outstanding
(including consents obtained in connection with a tender offer or exchange offer
for, or purchase of, the Securities). However, without the consent of each
Holder of a Security affected, an amendment or waiver may not:

          (i) reduce the amount of Securities whose Holders must consent to an
     amendment;

          (ii) reduce the rate of or extend the time for payment of interest
     (including Additional Interest, if any) on any Security;

          (iii) reduce the Accreted Value or principal of or extend the Stated
     Maturity of any Security;

          (iv) reduce the premium payable upon the redemption of any Security or
     change the time at which any Security may be redeemed in accordance with
     Article 3;

          (v) make any Security payable in money other than that stated in the
     Security;

          (vi) impair the right of any Holder to receive payment of Accreted
     Value or principal of, and interest (including Additional Interest, if any)
     on, such Holder's Securities on or after the due dates therefor or to
     institute suit for the enforcement of any payment on or with respect to
     such Holder's Securities;

          (vii) make any change in Section 6.04 or 6.07 or the second sentence
     of this Section 9.02; or

          (viii) modify the Note Guarantees in any manner adverse to the
     Holders.

          (b) Notwithstanding the foregoing, without the consent of Holders
representing 66 2/3% in principal amount of the Securities then outstanding, no
amendment or waiver may:

          (i) release any Collateral from the Lien of this Indenture and the
     Security Documents (except as permitted by the terms of the Security
     Documents or the Intercreditor Agreement);

          (ii) change the provisions applicable to the application of the
     proceeds from the sale of Collateral; or

          (iii) change or alter the priority of the security interests in the
     Collateral.



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          It shall not be necessary for the consent of the Holders under this
Section 9.02 to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent approves the substance thereof.

          After an amendment under this Section 9.02 becomes effective, the
Company shall mail to Holders a notice briefly describing such amendment. The
failure to give such notice to all Holders, or any defect therein, shall not
impair or affect the validity of an amendment under this Section 9.02.

          SECTION 9.03. COMPLIANCE WITH TRUST INDENTURE ACT. Every amendment to
this Indenture or the Securities shall comply with the TIA as then in effect.

          SECTION 9.04. REVOCATION AND EFFECT OF CONSENTS AND WAIVERS. (a) A
consent to an amendment or a waiver by a Holder of a Security shall bind the
Holder and every subsequent Holder of that Security or portion of the Security
that evidences the same debt as the consenting Holder's Security, even if
notation of the consent or waiver is not made on the Security. However, any such
Holder or subsequent Holder may revoke the consent or waiver as to such Holder's
Security or portion of the Security if the Trustee receives the notice of
revocation before the date on which the Trustee receives an Officers'
Certificate from the Company certifying that the requisite number of consents
have been received. After an amendment or waiver becomes effective, it shall
bind every Holder. An amendment or waiver becomes effective upon the (i) receipt
by the Company or the Trustee of the requisite number of consents, (ii)
satisfaction of conditions to effectiveness as set forth in this Indenture and
any indenture supplemental hereto containing such amendment or waiver and (iii)
execution of such amendment or waiver (or supplemental indenture) by the Company
and the Trustee.

          (b) The Company may, but shall not be obligated to, fix a record date
for the purpose of determining the Holders entitled to give their consent or
take any other action described above or required or permitted to be taken
pursuant to this Indenture. If a record date is fixed, then notwithstanding the
immediately preceding paragraph, those Persons who were Holders at such record
date (or their duly designated proxies), and only those Persons, shall be
entitled to give such consent or to revoke any consent previously given or to
take any such action, whether or not such Persons continue to be Holders after
such record date. No such consent shall be valid or effective for more than 120
days after such record date.

          SECTION 9.05. NOTATION ON OR EXCHANGE OF SECURITIES. If an amendment
changes the terms of a Security, the Trustee may require the Holder of the
Security to deliver it to the Trustee. The Trustee may place an appropriate
notation on the Security regarding the changed terms and return it to the
Holder. Alternatively, if the Company or the Trustee so determines, the Company
in exchange for the Security shall issue and the Trustee shall authenticate a
new Security that reflects the changed terms. Failure to make the appropriate
notation or to issue a new Security shall not affect the validity of such
amendment.



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          SECTION 9.06. TRUSTEE TO SIGN AMENDMENTS. The Trustee shall sign any
amendment authorized pursuant to this Article 9 if the amendment does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
If it does, the Trustee may but need not sign it. In signing such amendment the
Trustee shall be entitled to receive indemnity reasonably satisfactory to it and
to receive, and (subject to Section 7.01) shall be fully protected in relying
upon, an Officers' Certificate and an Opinion of Counsel stating that such
amendment is authorized or permitted by this Indenture and that such amendment
is the legal, valid and binding obligation of the Company and the Note
Guarantors enforceable against them in accordance with its terms, subject to
customary exceptions, and complies with the provisions hereof (including Section
9.03).

                                    ARTICLE X

                             COLLATERAL AND SECURITY

          SECTION 10.01. SECURITY DOCUMENTS. The due and punctual payment of the
principal of and interest (including Additional Interest, if any) on the
Securities when and as the same shall be due and payable, whether on an interest
payment date, at maturity, by acceleration, repurchase, redemption or otherwise,
and interest on the overdue principal of and interest (including Additional
Interest, if any) on the Securities and performance of all other obligations of
the Company and the Note Guarantors to the Holders or the Trustee under this
Indenture and the Securities, according to the terms hereunder or thereunder,
are secured as provided in the Security Documents, subject to the terms of the
Intercreditor Agreement. Each Holder of a Security, by its acceptance thereof,
consents and agrees to all of the terms of the Security Documents (including the
provisions providing for foreclosure and release of Collateral) and the
Intercreditor Agreement as the same may be in effect or may be amended from time
to time in accordance with their terms and authorizes and directs the Collateral
Agent to enter into the Security Documents and the Intercreditor Agreement and
to perform its obligations and exercise its rights thereunder in accordance
therewith. The Company shall deliver to the Trustee (if it is not then the
Collateral Agent) copies of all documents delivered to the Collateral Agent
pursuant to the Security Documents, and will do or cause to be done all such
acts and things as may be required by the next sentence of this Section 10.01,
to assure and confirm to the Trustee and the Collateral Agent the security
interest in the Collateral contemplated hereby, by the Security Documents or any
part thereof, as from time to time constituted, so as to render the same
available for the security and benefit of this Indenture and of the Securities
secured hereby, according to the intent and purposes herein expressed. The
Company shall take, and shall cause its Restricted Subsidiaries to take, any and
all actions reasonably required to cause the Security Documents to create and
maintain, as security for the Obligations of the Company and the Note Guarantors
hereunder, a valid and enforceable perfected (a) first-priority Lien and
security interest in and on all First-Priority Collateral (consisting of the
2004 Notes First Lien Collateral, as defined in the Intercreditor Agreement, as
in effect on the Closing Date) and (b) second-priority Lien and security
interest in and on all Second-Priority Collateral (consisting of the Senior
Lender First Lien Collateral, as defined in the Intercreditor Agreement, as in



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effect on the Closing Date), in each case, subject to the terms of the
Intercreditor Agreement and in favor of the Collateral Agent for the benefit of
the Holders.

          SECTION 10.02. RECORDING AND OPINIONS. (a) The Company will deliver to
the Collateral Agent and the Trustee on May 15 in each year beginning with May
15 , 2004, an Opinion of Counsel, which may be rendered by internal counsel to
the Company, dated as of such date, either:

          (i) stating substantially to the effect that, in the opinion of such
     counsel, action has been taken with respect to the recording, filing,
     re-recording, and re-filing of this Indenture or any Security Document as
     is necessary to maintain the Lien of this Indenture or any Security
     Documents and reciting with respect to the security interests in the
     Collateral the details of such action or referring to prior Opinions of
     Counsel in which such details are given; or

          (ii) stating that, in the opinion of such counsel, no such action is
     necessary to maintain and perfect such Lien under this Indenture and the
     Security Documents.

          (b)  The Company will otherwise comply with the provisions of
TIA Section 314(b).

          SECTION 10.03. RELEASE OF COLLATERAL. (a) Subject to subsections (b),
(c) and (d) of this Section 10.03, Collateral may be released from the Lien and
security interest created by the Security Documents at any time or from time to
time in accordance with the provisions of the Security Documents and as provided
hereby.

          (i) Upon the request of the Company pursuant to an Officers'
     Certificate certifying that all conditions precedent hereunder have been
     met and without the consent of any Holder, the Company and the Note
     Guarantors will be entitled to releases of assets included in the
     First-Priority Collateral from the Liens securing the Securities under any
     one or more of the following circumstances:

          (A) to enable the Company or any Note Guarantor to consummate any
     Asset Disposition permitted or not prohibited by Section 4.06 hereof;

          (B) if any Subsidiary that is a Note Guarantor is released from its
     Note Guarantee, such Subsidiary's assets will also be released; or

          (C) pursuant to an amendment, waiver or supplement in accordance with
     Article 9 hereof.

     Upon receipt of such Officers' Certificate and any necessary or proper
     instruments of termination, satisfaction or release prepared by the
     Company, the Collateral Agent shall execute, deliver or acknowledge such
     instruments or releases to evidence the release of any Collateral permitted
     to be released pursuant to this Indenture or the Security Documents.



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          (ii) Whether prior to or after the Discharge of Credit Agreement
     Obligations, upon the request of the Company pursuant to an Officers'
     Certificate certifying that all conditions precedent hereunder have been
     met and without the consent of any Holder, the Company and the Note
     Guarantors will be entitled to releases of assets included in the
     Second-Priority Collateral from the Liens securing the Securities under any
     one or more of the following circumstances:

          (A) if all other Liens (other than Permitted Liens described in
     clauses (b) through (aa) of the definition thereof) on any such asset that
     secure Credit Agreement Obligations or any Secondary Collateral Obligations
     then secured by that asset (including all commitments thereunder) are
     released; PROVIDED, that after giving effect to the release, obligations
     secured by the first-priority Liens on the remaining Second-Priority
     Collateral remain outstanding;

          (B) to enable the Company or any Note Guarantor to consummate any
     Asset Disposition permitted or not prohibited by Section 4.06 hereof;

          (C) if all of the stock of any Subsidiary of the Company that is
     pledged to the Collateral Agent is released or if any Subsidiary that is a
     Note Guarantor is released from its Note Guarantee, such Subsidiary's
     assets will also be released; or

          (D) pursuant to an amendment, waiver or supplement in accordance with
     Article 9 hereof.

          Upon receipt of such Officers' Certificate and any necessary or proper
instruments of termination, satisfaction or release prepared by the Company, the
Collateral Agent shall execute, deliver or acknowledge such instruments or
releases to evidence the release of any Collateral permitted to be released
pursuant to this Indenture or the Security Documents.

          (b) Except as otherwise provided in the Intercreditor Agreement and
except as set forth in the preceding paragraph, no Collateral may be released
from the Lien and security interest created by the Security Documents pursuant
to the provisions of the Security Documents unless the Officers' Certificate
required by this Section 10.03 has been delivered to the Collateral Agent.

          (c) At any time when a Default or Event of Default has occurred and is
continuing and the maturity of the Securities has been accelerated (whether by
declaration or otherwise) and the Trustee has delivered a notice of acceleration
to the Collateral Agent, no release of Collateral pursuant to the provisions of
the Security Documents will be effective as against the Holders, except as
otherwise provided in the Intercreditor Agreement.

          (d) The release of any Collateral from the terms of this Indenture and
the Security Documents shall not be deemed to impair the security under this
Indenture in contravention of the provisions hereof if and to the extent the
Collateral is released pursuant to the terms of (i) the Intercreditor Agreement
or (ii) this Indenture and the



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Security Documents. To the extent applicable, the Company will cause TIA Section
313(b), relating to reports, and TIA Section 314(d), relating to the release of
property or securities from the Lien and security interest of this Indenture and
the Security Documents and relating to the substitution therefor of any property
or securities to be subjected to the Lien and security interest of this
Indenture and the Security Documents, to be complied with. Any certificate or
opinion required by TIA Section 314(d) may be made by an Officer of the Company
except in cases where TIA Section 314(d) requires that such certificate or
opinion be made by an independent Person, which Person will be an independent
engineer, appraiser or other expert selected or approved by the Trustee and the
Collateral Agent in the exercise of reasonable care.

          SECTION 10.04. CERTIFICATES OF THE TRUSTEE. In the event that the
Company wishes to release Collateral in accordance with the Security Documents
at a time when the Trustee is not itself also the Collateral Agent and the
Company has delivered the certificates and documents required by the Security
Documents and Section 10.03 hereof, the Trustee will determine whether it has
received all documentation required by TIA Section 314(d) in connection with
such release and, based on such determination, will deliver a certificate to the
Collateral Agent setting forth such determination.

          SECTION 10.05. AUTHORIZATION OF ACTIONS TO BE TAKEN BY THE TRUSTEE
UNDER THE SECURITY DOCUMENTS. Subject to the provisions of Section 7.01 and 7.02
hereof and the Intercreditor Agreement, the Trustee may, in its sole discretion
and without the consent of the Holders, direct, on behalf of the Holders, the
Collateral Agent to take all actions it deems necessary or appropriate in order
to:

          (a) enforce any of the terms of the Security Documents; and

          (b) collect and receive any and all amounts payable in respect of the
Obligations of the Company hereunder.

          Subject to Section 3 of the Intercreditor Agreement, the Trustee will
have power to institute and maintain such suits and proceedings as it may deem
expedient to prevent any impairment of the Collateral by any acts that may be
unlawful or in violation of the Security Documents or this Indenture, and such
suits and proceedings as the Trustee may deem expedient to preserve or protect
its interests and the interests of the Holders in the Collateral (including
power to institute and maintain suits or proceedings to restrain the enforcement
of or compliance with any legislative or other governmental enactment, rule or
order that may be unconstitutional or otherwise invalid if the enforcement of,
or compliance with, such enactment, rule or order would impair the security
interest hereunder or be prejudicial to the interests of the Holders or of the
Trustee).

          SECTION 10.06. AUTHORIZATION OF RECEIPT OF FUNDS BY THE TRUSTEE UNDER
THE SECURITY DOCUMENTS. Subject to the provisions of the Intercreditor
Agreement, the Trustee is authorized to receive any funds for the benefit of the
Holders distributed under



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the Security Documents, and to make further distributions of such funds to the
Holders according to the provisions of this Indenture.

          SECTION 10.07. TERMINATION OF SECURITY INTEREST. The Trustee will, at
the request of the Company, deliver a certificate to the Collateral Agent
stating that such Obligations have been paid in full, and instruct the
Collateral Agent to release the Liens pursuant to this Indenture and the
Security Documents upon (1) payment in full of the Accreted Value or principal
of and accrued and unpaid interest (including Additional Interest, if any) on
the Securities and all other Obligations under this Indenture, the Note
Guarantees and the Security Documents that are due and payable at or prior to
the time such Accreted Value or principal, accrued and unpaid interest and
Additional Interest, if any, are paid, (2) a satisfaction and discharge of this
Indenture as described in Article 8 or (3) a legal defeasance or covenant
defeasance as described in Article 8. Upon receipt of such instruction and any
necessary or proper instruments of termination, satisfaction or release prepared
by the Company, the Collateral Agent shall execute, deliver or acknowledge any
such instruments or releases to evidence the release of all such Liens.

          SECTION 10.08. COLLATERAL AGENT. (a) The Trustee shall initially act
as Collateral Agent and shall be authorized to appoint co-Collateral Agents as
necessary in its sole discretion. Except as otherwise explicitly provided herein
or in the Security Documents, neither the Collateral Agent nor any of its
respective officers, directors, employees or agents shall be liable for failure
to demand, collect or realize upon any of the Collateral or for any delay in
doing so or shall be under any obligation to sell or otherwise dispose of any
Collateral upon the request of any other Person or to take any other action
whatsoever with regard to the Collateral or any part thereof. The Collateral
Agent shall be accountable only for amounts that it actually receives as a
result of the exercise of such powers, and neither the Collateral Agent nor any
of its officers, directors, employees or agents shall be responsible for any act
or failure to act hereunder, except for its own willful misconduct, gross
negligence or bad faith.

          (b) The Trustee, as Collateral Agent, is authorized and directed to
(i) enter into the Security Documents, (ii) enter into the Intercreditor
Agreement, (iii) bind the Holders on the terms as set forth in the Security
Documents and the Intercreditor Agreement and (iv) perform and observe its
obligations under the Security Documents and the Intercreditor Agreement.

          (c) If the Company (i) incurs Indebtedness constituting Credit
Agreement Obligations at any time when no Intercreditor Agreement is in effect
or at any time when Indebtedness constituting Credit Agreement Obligations
entitled to the benefit of an existing Intercreditor Agreement is concurrently
retired, and (ii) delivers to the Collateral Agent an Officers' Certificate so
stating and requesting the Collateral Agent to enter into an Intercreditor
Agreement in favor of a designated agent or representative for the holders of
the Indebtedness so incurred, the Collateral Agent shall (and is hereby
authorized and directed to) enter into such Intercreditor Agreement, bind the
Holders on the terms set forth therein, and perform and observe its obligations
thereunder.



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          (d) If (i) the Company at any time after the Closing Date incurs any
Indebtedness constituting Secondary Collateral Obligations, (ii) the indenture
or agreement governing such Indebtedness provides that, notwithstanding the
date, manner or order of grant, attachment or perfection of any second-priority
Liens granted to the Collateral Agent under the Security Documents (the
"Second-Priority Liens Securing Note Obligations") or granted to the holders of
Secondary Collateral Obligations or any agent or representative for the holders
of Secondary Collateral Obligations (the "Liens Securing Secondary Collateral
Obligations"), the Second-Priority Liens Securing Note Obligations and the Liens
Securing Secondary Collateral Obligations shall be of equal, dignity, priority
and rank, (iii) the Company delivers to the Collateral Agent an Officers'
Certificate so stating and requesting that the Collateral Agent assign or
transfer the Second-Priority Liens Securing Note Obligations to a Common
Collateral Agent identified therein and (iv) the Company delivers to the
Collateral Agent and the Common Collateral Agent an Opinion of Counsel further
confirming as to all such Liens each of the matters referred to in Section
10.02(a)(i), giving effect to the assignment or transfer requested in such
Officers' Certificate, then (A) the Second-Priority Liens Securing Note
Obligations shall be of equal dignity, priority and rank with all such Liens
Securing Secondary Collateral Obligations and (B) the Collateral Agent shall,
upon receipt of the necessary or proper documentation prepared by the Company,
assign or transfer the Second-Priority Liens Securing Note Obligations to the
Common Collateral Agent as requested in such Officers' Certificate.

          SECTION 10.09. DESIGNATIONS. Except as provided in the next sentence,
for purposes of the provisions hereof and the Intercreditor Agreement requiring
the Company to designate Indebtedness for the purposes of the term "Credit
Agreement Obligations", "First-Lien Credit Facilities", "Other First-Priority
Obligations", "Secondary Collateral Obligations" or any other such designations
hereunder or under the Intercreditor Agreement, any such designation shall be
sufficient if the relevant designation is set forth in writing, signed on behalf
of the Company by an Officer and delivered to the Trustee, the Collateral Agent,
the Credit Agent and the May 2003 Notes Agent. For all purposes hereof and the
Intercreditor Agreement, the Company hereby designates the Credit Facilities
provided pursuant to the Credit Agreement as a "First-Lien Credit Facility".

                                   ARTICLE XI

                                 NOTE GUARANTEES

          SECTION 11.01. NOTE GUARANTEES. (a) Each Note Guarantor hereby jointly
and severally and unconditionally guarantees, as a primary obligor and not
merely as a surety, to each Holder and to the Trustee and its successors and
assigns (i) the full and punctual payment when due, whether at Stated Maturity,
by acceleration, by redemption or otherwise, of all obligations of the Company
under this Indenture (including obligations to the Trustee) and the Securities,
whether for payment of principal of, interest on or Additional Interest, if any,
in respect of the Securities and all other monetary obligations (to the fullest
extent permitted by applicable law) of the Company



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under this Indenture and the Securities and (ii) the full and punctual
performance within applicable grace periods of all other obligations of the
Company whether for fees, expenses, indemnification or otherwise under this
Indenture and the Securities (all the foregoing being hereinafter collectively
called the "Guaranteed Obligations"). To the fullest extent permitted by
applicable law, each Note Guarantor further agrees that the Guaranteed
Obligations may be extended or renewed, in whole or in part, without notice or
further assent from each such Note Guarantor, and that each such Note Guarantor
shall remain bound under this Article 11 notwithstanding any extension or
renewal of any Guaranteed Obligation.

          (b) Each Note Guarantor waives presentation to, demand of payment from
and protest to the Company of any of the Guaranteed Obligations and also waives
notice of protest for nonpayment. Each Note Guarantor waives notice of any
default under the Securities or the Guaranteed Obligations. The obligations of
each Note Guarantor hereunder shall not be affected by (i) the failure of any
Holder or the Trustee to assert any claim or demand or to enforce any right or
remedy against the Company or any other Person under this Indenture, the
Securities or any other agreement or otherwise; (ii) any extension or renewal of
any thereof; (iii) any rescission, waiver, amendment or modification of any of
the terms or provisions of this Indenture, the Securities or any other
agreement; (iv) the release of any security held by any Holder or the Trustee
for the Guaranteed Obligations or any of them; (v) the failure of any Holder or
Trustee to exercise any right or remedy against any other guarantor of the
Guaranteed Obligations; or (vi) any change in the ownership of such Note
Guarantor, except as provided in Section 11.02(b).

          (c) Each Note Guarantor hereby waives any right to which it may be
entitled to have its obligations hereunder divided among the Note Guarantors,
such that such Note Guarantor's obligations would be less than the full amount
claimed. Each Note Guarantor hereby waives any right to which it may be entitled
to have the assets of the Company first be used and depleted as payment of the
Company's or such Note Guarantor's obligations hereunder prior to any amounts
being claimed from or paid by such Note Guarantor hereunder. Each Note Guarantor
hereby waives any right to which it may be entitled to require that the Company
be sued prior to an action being initiated against such Note Guarantor.

          (d) Each Note Guarantor further agrees that its Note Guarantee herein
constitutes a guarantee of payment, performance and compliance when due (and not
a guarantee of collection) and waives any right to require that any resort be
had by any Holder or the Trustee to any security held for payment of the
Guaranteed Obligations.

          (e) Except as expressly set forth in Sections 8.01(b), 11.02 and
11.07, the obligations of each Note Guarantor hereunder shall not be subject to
any reduction, limitation, impairment or termination for any reason, including
any claim of waiver, release, surrender, alteration or compromise, and shall not
be subject to any defense of setoff, counterclaim, recoupment or termination
whatsoever or by reason of the invalidity, illegality or unenforceability of the
Guaranteed Obligations or otherwise. Without limiting the generality of the
foregoing, the obligations of each Note Guarantor



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herein shall not be discharged or impaired or otherwise affected by the failure
of any Holder or the Trustee to assert any claim or demand or to enforce any
remedy under this Indenture, the Securities or any other agreement, by any
waiver or modification of any thereof, by any default, failure or delay, willful
or otherwise, in the performance of the obligations, or by any other act or
thing or omission or delay to do any other act or thing which may or might in
any manner or to any extent vary the risk of any Note Guarantor or would
otherwise operate as a discharge of any Note Guarantor as a matter of law or
equity.

          (f) Each Note Guarantor agrees that its Note Guarantee shall remain in
full force and effect until payment in full of all the Guaranteed Obligations or
such Note Guarantee is released in compliance with Section 11.03 or upon the
merger or the sale of all the Capital Stock or assets of the Note Guarantor in
compliance with Section 4.06 or Article 5. Each Note Guarantor further agrees
that its Note Guarantee herein shall, to the fullest extent permitted by
applicable law, continue to be effective or be reinstated, as the case may be,
if at any time payment, or any part thereof, of principal of or interest or
Additional Interest, if any, on any Guaranteed Obligation is rescinded or must
otherwise be restored by any Holder or the Trustee upon the bankruptcy or
reorganization of the Company or otherwise.

          (g) In furtherance of the foregoing and not in limitation of any other
right which any Holder or the Trustee has at law or in equity against any Note
Guarantor by virtue hereof, upon the failure of the Company to pay the principal
of or interest or Additional Interest, if any, on any Guaranteed Obligation when
and as the same shall become due, whether at maturity, by acceleration, by
redemption or otherwise, or to perform or comply with any other Guaranteed
Obligation, each Note Guarantor hereby promises to and shall, upon receipt of
written demand by the Trustee, forthwith pay, or cause to be paid, in cash, to
the Holders or the Trustee an amount equal to the sum of (i) the unpaid
principal amount of such Guaranteed Obligations, (ii) accrued and unpaid
interest on such Guaranteed Obligations (but only to the extent not prohibited
by law) and (iii) all other monetary obligations of the Company to the Holders
and the Trustee.

          (h) Each Note Guarantor agrees that it shall not be entitled to any
right of subrogation in relation to the Holders in respect of any Guaranteed
Obligations guaranteed hereby until payment in full of all Guaranteed
Obligations. Each Note Guarantor further agrees that, as between it, on the one
hand, and the Holders and the Trustee, on the other hand, to the fullest extent
permitted by applicable law, (i) the maturity of the Guaranteed Obligations
guaranteed hereby may be accelerated as provided in Article 6 for the purposes
of any Note Guarantee herein, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the Guaranteed
Obligations guaranteed hereby, and (ii) in the event of any declaration of
acceleration of such Guaranteed Obligations as provided in Article 6, such
Guaranteed Obligations (whether or not due and payable) shall forthwith become
due and payable by such Note Guarantor for the purposes of this Section 11.01.



                                                                              93

          (i) Each Note Guarantor also agrees to pay any and all costs and
expenses (including reasonable attorneys' fees and expenses) incurred by the
Trustee or any Holder in enforcing any rights under this Section 11.01.

          (j) Upon request of the Trustee, each Note Guarantor shall execute and
deliver such further instruments and do such further acts as may be reasonably
necessary or proper to carry out more effectively the purpose of this Indenture.

          SECTION 11.02. LIMITATION ON LIABILITY. Any term or provision of this
Indenture to the contrary notwithstanding, the maximum aggregate amount of the
Guaranteed Obligations guaranteed hereunder by any Note Guarantor shall not
exceed the maximum amount that can be hereby guaranteed without rendering this
Indenture, as it relates to such Note Guarantor, void or voidable under
applicable law relating to fraudulent conveyance or fraudulent transfer or
similar laws affecting the rights of creditors generally.

          SECTION 11.03. RELEASES OF NOTE GUARANTEES. A Note Guarantee shall be
released without any action required on the part of the Trustee or any Holder:
(a) if the Note Guarantor is a Foreign Subsidiary and it does not guarantee any
Indebtedness of the Company or any domestic Subsidiary; (b) if (i) all of the
Capital Stock of, or all or substantially all of the assets of such Note
Guarantor is sold or otherwise disposed of (including by way of merger or
consolidation) to a Person other than the Company or another Note Guarantor
(PROVIDED that such Note Guarantor does not continue to guarantee any
Indebtedness of the Company or any domestic Subsidiary) or (ii) such Note
Guarantor ceases to be a Restricted Subsidiary, and the Company otherwise
complies, to the extent applicable, with Section 4.06 and Section 5.01 hereof;
or (c) if the Company designates such Note Guarantor as an Unrestricted
Subsidiary (unless any of the First-Priority Collateral is then owned by such
Note Guarantor). A Note Guarantor may also be released from its obligations
under its Note Guarantee in connection with an amendment permitted by Article 9.

          Upon delivery by the Company to the Trustee of an Officers'
Certificate and an Opinion of Counsel to the effect that such release was made
by the Company in accordance with the provisions of this Indenture, the Trustee
will execute any documents prepared by the Company reasonably required in order
to evidence the release of any Note Guarantor from its obligations under its
Note Guarantee.

          Any Note Guarantor not released from its obligations under its Note
Guarantee will remain liable for the full amount of principal of and interest on
the Securities and for the other obligations of any Note Guarantor under this
Indenture as provided in this Article 11.

          SECTION 11.04. SUCCESSORS AND ASSIGNS. This Article 11 shall be
binding upon each Note Guarantor and its successors and assigns and shall inure
to the benefit of the successors and assigns of the Trustee and the Holders and,
in the event of any transfer or assignment of rights by any Holder or the
Trustee, the rights and privileges conferred upon that party in this Indenture
and in the Securities shall



                                                                              94

automatically extend to and be vested in such transferee or assignee, all
subject to the terms and conditions of this Indenture.

          SECTION 11.05. NO WAIVER. Neither a failure nor a delay on the part of
either the Trustee or the Holders in exercising any right, power or privilege
under this Article 11 shall operate as a waiver thereof, nor shall a single or
partial exercise thereof preclude any other or further exercise of any right,
power or privilege. The rights, remedies and benefits of the Trustee and the
Holders herein expressly specified are cumulative and not exclusive of any other
rights, remedies or benefits which either may have under this Article 11 at law,
in equity, by statute or otherwise.

          SECTION 11.06. MODIFICATION. No modification, amendment or waiver of
any provision of this Article 11, nor the consent to any departure by any Note
Guarantor therefrom, shall in any event be effective unless the same shall be in
writing and signed by the Trustee, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given. No
notice to or demand on any Note Guarantor in any case shall entitle such Note
Guarantor to any other or further notice or demand in the same, similar or other
circumstances.

          SECTION 11.07. EXECUTION OF SUPPLEMENTAL INDENTURE FOR FUTURE NOTE
GUARANTORS. Each Subsidiary which is required to become a Note Guarantor
pursuant to Section 4.11 shall promptly execute and deliver to the Trustee a
supplemental indenture in the form of Exhibit C hereto pursuant to which such
Subsidiary shall become a Note Guarantor under this Article 11 and shall
guarantee the Guaranteed Obligations. Concurrently with the execution and
delivery of such supplemental indenture, the Company shall deliver to the
Trustee an Opinion of Counsel and an Officers' Certificate to the effect that
such supplemental indenture has been duly authorized, executed and delivered by
such Subsidiary and that, subject to the application of bankruptcy, insolvency,
moratorium, fraudulent conveyance or transfer and other similar laws relating to
creditors' rights generally and to the principles of equity, whether considered
in a proceeding at law or in equity, the Note Guarantee of such Note Guarantor
is a valid and binding obligation of such Note Guarantor, enforceable against
such Note Guarantor in accordance with its terms and or to such other matters as
the Trustee may reasonably request.

          SECTION 11.08. NON-IMPAIRMENT. The failure to endorse a Note Guarantee
on any Security shall not affect or impair the validity thereof.

                                   ARTICLE XII

                                  MISCELLANEOUS

          SECTION 12.01. TRUST INDENTURE ACT CONTROLS. If and to the extent that
any provision of this Indenture limits, qualifies or conflicts with the duties
imposed by, or with another provision (an "incorporated provision") included in
this Indenture by operation of, TIA Sections 310 to 318, inclusive, such imposed
duties or incorporated provision shall control.



                                                                              95

          SECTION 12.02. NOTICES. Any notice or communication shall be in
writing (which may be a facsimile with the original to follow) and delivered in
person or mailed by first-class mail addressed as follows:

                    if to the Company:

                    Pliant Corporation
                    1515 Woodfield Road, Suite 600
                    Schaumburg, Illinois 60173

                    Attention of:
                    Chief Financial Officer

                    if to the Trustee:

                    Wilmington Trust Company
                    Rodney Square North
                    1100 North Market Street
                    Wilmington, DE 19890-0001

                    Attention of:
                    Corporate Trust Administration

          The Company or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.

          Any notice or communication mailed to a Holder shall be mailed, first
class mail, to the Holder at the Holder's address as it appears on the
registration books of the Registrar and shall be sufficiently given if so mailed
within the time prescribed.

          Failure to mail a notice or communication to a Holder or any defect in
it shall not affect its sufficiency with respect to other Holders. If a notice
or communication is mailed in the manner provided above, it is duly given,
whether or not the addressee receives it.

          SECTION 12.03. COMMUNICATION BY HOLDERS WITH OTHER HOLDERS. Holders
may communicate pursuant to TIA Section 312(b) with other Holders with respect
to their rights under this Indenture or the Securities. The Company, the
Trustee, the Registrar and anyone else shall have the protection of TIA Section
312(c).

          SECTION 12.04. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company to the Trustee to take or refrain
from taking any action under this Indenture, the Company shall furnish to the
Trustee:

          (a) an Officers' Certificate in form reasonably satisfactory to the
     Trustee stating that, in the opinion of the signers, all conditions
     precedent, if any, provided for in this Indenture relating to the proposed
     action have been complied with; and



                                                                              96

          (b) an Opinion of Counsel in form reasonably satisfactory to the
     Trustee stating that, in the opinion of such counsel, all such conditions
     precedent have been complied with (PROVIDED, HOWEVER, that such counsel may
     rely as to matters of fact on Officers' Certificates).

          SECTION 12.05. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION. Each
certificate or opinion with respect to compliance with a covenant or condition
provided for in this Indenture (other than pursuant to Section 4.09) shall
include:

          (a)  a statement that the individual making such certificate or
     opinion has read such covenant or condition;

          (b) a brief statement as to the nature and scope of the examination or
     investigation upon which the statements or opinions contained in such
     certificate or opinion are based;

          (c) a statement that, in the opinion of such individual, he has made
     such examination or investigation as is necessary to enable him to express
     an informed opinion as to whether or not such covenant or condition has
     been complied with; and

          (d) a statement as to whether or not, in the opinion of such
     individual, such covenant or condition has been complied with.

          SECTION 12.06. WHEN SECURITIES DISREGARDED. In determining whether the
Holders of the required principal amount of Securities have concurred in any
direction, waiver or consent, Securities owned by the Company, any Note
Guarantor or by any Person directly or indirectly controlling or controlled by
or under direct or indirect common control with the Company or any Note
Guarantor (other than JP Morgan Securities, Inc.) shall be disregarded and
deemed not to be outstanding, except that, for the purpose of determining
whether the Trustee shall be protected in relying on any such direction, waiver
or consent, only Securities which the Trustee knows are so owned shall be so
disregarded. Subject to the foregoing, only Securities outstanding at the time
shall be considered in any such determination.

          SECTION 12.07. RULES BY TRUSTEE, PAYING AGENT AND REGISTRAR. The
Trustee may make reasonable rules for action by or a meeting of Holders. The
Registrar and the Paying Agent may make reasonable rules for their functions.

          SECTION 12.08. LEGAL HOLIDAYS. A "Legal Holiday" is a Saturday, a
Sunday or other day on which banking institutions are not required by law or
regulation to be open in the State of New York. If a payment date is a Legal
Holiday, payment shall be made on the next succeeding day that is not a Legal
Holiday, and no interest shall accrue for the intervening period. If a regular
record date is a Legal Holiday, the record date shall not be affected.

          SECTION 12.09. GOVERNING LAW. THIS INDENTURE AND THE SECURITIES SHALL
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE



                                                                              97

WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

          SECTION 12.10. NO RECOURSE AGAINST OTHERS. A director, officer,
employee or stockholder, as such, of the Company or any of the Note Guarantors,
shall not have any liability for any obligations of the Company or any of the
Note Guarantors under the Securities or this Indenture or for any claim based
on, in respect of or by reason of such obligations or their creation. By
accepting a Security, each Holder shall waive and release all such liability.
The waiver and release shall be part of the consideration for the issue of the
Securities.

          SECTION 12.11. SUCCESSORS. All agreements of the Company and each Note
Guarantor in this Indenture and the Securities shall bind its successors. All
agreements of the Trustee in this Indenture shall bind its successors.

          SECTION 12.12. MULTIPLE ORIGINALS. The parties may sign any number of
copies of this Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement. One signed copy is enough to prove this
Indenture.

          SECTION 12.13. TABLE OF CONTENTS; HEADINGS. The table of contents,
cross-reference sheet and headings of the Articles and Sections of this
Indenture have been inserted for convenience of reference only, are not intended
to be considered a part hereof and shall not modify or restrict any of the terms
or provisions hereof.



                                                                              98

          IN WITNESS WHEREOF, the parties have caused this Indenture to be duly
executed as of the date first written above.

                               PLIANT CORPORATION,


                               By
                                  -------------------------
                                  Name:
                                  Title:


                               PLIANT CORPORATION INTERNATIONAL,
                               PLIANT FILM PRODUCTS OF MEXICO, INC.,
                               PLIANT PACKAGING OF CANADA, LLC,
                               UNIPLAST HOLDINGS INC.,
                               UNIPLAST U.S., INC.,
                               UNIPLAST INDUSTRIES CO.,


                               By
                                  -------------------------
                                  Name:
                                  Title:


                               WILMINGTON TRUST COMPANY, as Trustee


                               By
                                  -------------------------
                                  Name:
                                  Title:



                                                                      APPENDIX A

                   PROVISIONS RELATING TO EXISTING SECURITIES,
                  ADDITIONAL SECURITIES, PRIVATE EXCHANGE NOTES
                               AND EXCHANGE NOTES

     1. DEFINITIONS

     1.1 DEFINITIONS

     For the purposes of this Appendix A the following terms shall have the
meanings indicated below:

          "Applicable Procedures" means, with respect to any transfer or
transaction involving a Regulation S Global Security or beneficial interest
therein, the rules and procedures of the Depositary for such Global Security to
the extent applicable to such transaction and as in effect from time to time.

          "Definitive Security" means a certificated Initial Security, Private
Exchange Note or Exchange Note (bearing the Restricted Securities Legend if the
transfer of such Security is restricted by applicable law) that does not include
the Global Securities Legend.

          "Depositary" means The Depository Trust Company, its nominees and
their respective successors.

          "Global Securities Legend" means the legend set forth under that
caption in Exhibit A-1 to this Indenture.

          "IAI" means an institutional "accredited investor" as described in
Rule 501(a)(1), (2), (3) or (7) under the Securities Act.

          "Initial Purchasers" means J.P. Morgan Securities, Inc., Credit
Suisse First Boston LLC and Deutsche Bank Securities Inc.

          "Issue Date" means, with respect to any Initial Securities, the date
on which such Initial Securities are originally issued.

          "Private Exchange" means an offer by the Company, pursuant to a
Registration Agreement, to issue and deliver to certain purchasers, in exchange
for Initial Securities held by such purchasers as part of their initial
distribution, a like aggregate principal amount of Private Exchange Notes.

          "Private Exchange Notes" means the Securities of the Company issued in
exchange for Initial Securities pursuant to this Indenture in connection with a
Private Exchange pursuant to a Registration Agreement.

          "Purchase Agreement" means (a) the Purchase Agreement dated February
6, 2004, among the Company, the Note Guarantors and the Initial Purchasers and
(b) any other similar Purchase Agreement relating to Additional Securities.



                                                                               2

          "QIB" means a "qualified institutional buyer" as defined in Rule 144A.

          "Registered Exchange Offer" means an offer by the Company, pursuant to
a Registration Agreement, to certain Holders of Initial Securities, to issue and
deliver to such Holders, in exchange for their Initial Securities, a like
aggregate principal amount of Exchange Notes registered under the Securities
Act.

          "Registration Agreement" means (a) the Exchange and Registration
Rights Agreement dated February 17, 2004, among the Company, the Note Guarantors
and the Initial Purchasers, (b) the Exchange and Registration Rights Agreement
dated May 6, 2005 among the Company, the Note Guarantors and J.P. Morgan
Securities Inc., as solicitation agent, relating to the Consenting Securities
and (c) any other similar Exchange and Registration Rights Agreement relating to
Additional Securities.

          "Regulation S" means Regulation S under the Securities Act.

          "Regulation S Securities" means all Initial Securities offered and
sold outside the United States in reliance on Regulation S.

          "Restricted Period", with respect to any Securities, means the period
of 40 consecutive days beginning on and including the later of (a) the day on
which such Securities are first offered to persons other than distributors (as
defined in Regulation S under the Securities Act) in reliance on Regulation S,
notice of which day shall be promptly given by the Company to the Trustee, and
(b) the Issue Date with respect to such Securities.

          "Restricted Securities Legend" means the legend set forth in Section
2.3(e)(i) herein.

          "Rule 501" means Rule 501(a)(1), (2), (3) or (7) under the Securities
Act.

          "Rule 144A" means Rule 144A under the Securities Act.

          "Rule 144A Securities" means all Initial Securities offered and sold
to QIBs in reliance on Rule 144A.

          "Securities Act" means the Securities Act of 1933, as amended.

          "Securities Custodian" means the custodian with respect to a Global
Security (as appointed by the Depositary) or any successor person thereto, who
shall initially be the Trustee.

          "Shelf Registration Statement" means a registration statement filed by
the Company in connection with the offer and sale of Initial Securities pursuant
to the Registration Agreement.

          "Transfer Restricted Securities" means Definitive Securities and any
other Securities that bear or are required to bear the Restricted Securities
Legend.



                                                                               3

     1.2 OTHER DEFINITIONS



                                                                       Defined
          Term:                                                      in Section:
          -----                                                      -----------
                                                                    
"Agent Members"..................................................      2.1(c)
"IAI Global Security"............................................      2.1(b)
"Global Security"................................................      2.1(b)
"Regulation S Global Security"...................................      2.1(b)
"Rule 144A Global Security"......................................      2.1(b)


     2.  THE SECURITIES

     2.1 FORM AND DATING

          (a) The Consenting Securities issued on the Closing Date will be
issued by the Company only to (1) QIBs, (2) Persons other than U.S. Persons (as
defined in Regulation S) and Persons not in the United States (as defined in
Regulation S) and (3) IAIs. Such Consenting Securities may thereafter be
transferred to, among others, QIBs, purchasers in reliance on Regulation S and
IAIs in accordance with Rule 501. Additional Securities offered after the date
hereof may be offered and sold by the Company from time to time pursuant to one
or more Purchase Agreements in accordance with applicable law.

          (b) GLOBAL SECURITIES. Securities issued to QIBs shall be issued
initially in the form of one or more permanent global Securities in definitive,
fully registered form (collectively, the "Rule 144A Global Security"),
Securities issued to non-U.S. Persons and Persons not in the United States shall
be issued initially in the form of one or more global Securities (collectively,
the "Regulation S Global Security") and Securities issued to IAIs shall be
issued initially in the form of one or more permanent global Securities in
definitive, fully registered form (collectively, the "IAI Global Security"), in
each case without interest coupons and bearing the Global Securities Legend and,
in the case of Consenting Securities, the Restricted Securities Legend, which
shall be deposited on behalf of the holders of the Securities represented
thereby with the Securities Custodian, and registered in the name of the
Depositary or a nominee of the Depositary, duly executed by the Company and
authenticated by the Trustee as provided in this Indenture. Beneficial ownership
interests in the Regulation S Global Security shall not be exchangeable for
interests in the Rule 144A Global Security, the IAI Global Security or any other
Security without a Restricted Securities Legend until the expiration of the
Restricted Period. The Rule 144A Global Security, the IAI Global Security and
the Regulation S Global Security are each referred to herein as a "Global
Security" and are collectively referred to herein as "Global Securities",
PROVIDED, that the term "Global Security" when used in Sections 2.1(b), 2.1(c),
2.3(g)(i), 2.3(h)(i) and 2.4 of this Appendix shall also include any Security in
global form issued in connection with a Registered Exchange Offer or Private
Exchange. The aggregate principal amount of the Global Securities may from time
to time be increased or decreased by adjustments made



                                                                               4

on the records of the Trustee and the Depositary or its nominee and on the
schedules thereto as hereinafter provided.

          (c) BOOK-ENTRY PROVISIONS. This Section 2.1(c) shall apply only to a
Global Security deposited with or on behalf of the Depositary.

          The Company shall execute and the Trustee shall, in accordance with
this Section 2.1(c) and Section 2.2 and pursuant to an order of the Company
signed by two Officers, authenticate and deliver initially one or more Global
Securities that (i) shall be registered in the name of the Depositary for such
Global Security or Global Securities or the nominee of such Depositary and (ii)
shall be delivered by the Trustee to such Depositary or pursuant to such
Depositary's instructions or held by the Trustee as Securities Custodian.

          Members of, or participants in, the Depositary ("Agent Members") shall
have no rights under this Indenture with respect to any Global Security held on
their behalf by the Depositary or by the Trustee as Securities Custodian or
under such Global Security, and the Depositary may be treated by the Company,
the Trustee and any agent of the Company or the Trustee as the absolute owner of
such Global Security for all purposes whatsoever. Notwithstanding the foregoing,
nothing herein shall prevent the Company, the Trustee or any agent of the
Company or the Trustee from giving effect to any written certification, proxy or
other authorization furnished by the Depositary or impair, as between the
Depositary and its Agent Members, the operation of customary practices of such
Depositary governing the exercise of the rights of a holder of a beneficial
interest in any Global Security.

          (d) DEFINITIVE SECURITIES. Except as provided in Section 2.3 or 2.4,
owners of beneficial interests in Global Securities will not be entitled to
receive physical delivery of certificated Securities.

     2.2 AUTHENTICATION. The Trustee shall authenticate and make available for
delivery upon a written order of the Company signed by two Officers (a)
Consenting Securities in an aggregate principal amount of $250,607,280 for issue
pursuant to Section 9.05 of the Indenture in exchange for Existing Securities
with respect to which consents to the Amendments were given and accepted by the
Company and Non-Consenting Securities in an aggregate principal amount at
maturity of $7,800,000 for issue pursuant to Section 9.05 of the Indenture in
exchange for Existing Securities with respect to which consents to the
Amendments were not given and accepted by the Company (provided that in lieu of
issuing and authenticating Non-Consenting Securities, upon written order of the
Company, the Trustee may instead reflect a notation decreasing the amount
outstanding under the global certificate evidencing the Existing Notes, such
that after such notation, such global certificate shall represent the
Non-Consenting Securities), (b) subject to the terms of this Indenture,
Additional Securities in an unlimited aggregate principal amount and (c) the (i)
Exchange Notes for issue only in a Registered Exchange Offer and (ii) Private
Exchange Notes for issue only in a Private Exchange, in the case of each of (i)
and (ii) pursuant to a Registration Agreement and for a like principal amount of
Initial Securities exchanged pursuant thereto. Such order shall specify the
aggregate principal



                                                                               5

amount of the Securities to be authenticated, the date on which the original
issue of Securities is to be authenticated and whether the Securities are to be
Consenting Securities, Additional Securities, Exchange Notes or Private Exchange
Notes. The aggregate principal amount of Securities outstanding at any time is
unlimited.

     2.3 TRANSFER AND EXCHANGE. (a) TRANSFER AND EXCHANGE OF DEFINITIVE
SECURITIES. When Definitive Securities are presented to the Registrar with a
request:

          (i) to register the transfer of such Definitive Securities; or

          (ii) to exchange such Definitive Securities for an equal principal
     amount of Definitive Securities of other authorized denominations,

the Registrar shall register the transfer or make the exchange as requested if
its reasonable requirements for such transaction are met; PROVIDED, HOWEVER,
that the Definitive Securities surrendered for transfer or exchange:

          (1) shall be duly endorsed or accompanied by a written instrument of
     transfer in form reasonably satisfactory to the Company and the Registrar,
     duly executed by the Holder thereof or his attorney duly authorized in
     writing; and

          (2) in the case of Definitive Securities which are Transfer Restricted
     Securities, are accompanied by the following additional information and
     documents, as applicable:

               (A) if such Definitive Securities are being delivered to the
          Registrar by a Holder for registration in the name of such Holder,
          without transfer, a certification from such Holder to that effect (in
          the form set forth on the reverse side of the Initial Security or
          Private Exchange Note, as applicable); or

               (B) if such Definitive Securities are being transferred to the
          Company, a certification to that effect (in the form set forth on the
          reverse side of the Initial Security or Private Exchange Note, as
          applicable); or

               (C) if such Definitive Securities are being transferred pursuant
          to an exemption from registration in accordance with Rule 144 under
          the Securities Act or in reliance upon another exemption from the
          registration requirements of the Securities Act, (x) a certification
          to that effect (in the form set forth on the reverse side of the
          Initial Security or Private Exchange Note, as applicable) and (y) if
          the Company so requests, an opinion of counsel or other evidence
          reasonably satisfactory to it as to the compliance with the
          restrictions set forth in the legend set forth in Section 2.3(e)(i)
          and (z) in the case of a transfer to an IAI, a signed letter
          substantially in the form of Exhibit D.

          (b) RESTRICTIONS ON TRANSFER OF A DEFINITIVE SECURITY FOR A BENEFICIAL
INTEREST IN A GLOBAL SECURITY. A Definitive Security may not be exchanged for a



                                                                               6

beneficial interest in a Global Security except upon satisfaction of the
requirements set forth below. Upon receipt by the Trustee of a Definitive
Security, duly endorsed or accompanied by a written instrument of transfer in
form reasonably satisfactory to the Company and the Registrar, together with:

          (i) certification (in the form set forth on the reverse side of the
     Initial Security or Private Exchange Note, as applicable) that such
     Definitive Security is being transferred (1) to a QIB in accordance with
     Rule 144A, (2) to an IAI that has furnished to the Trustee a signed letter
     substantially in the form of Exhibit D, and in the case of clause (2), an
     opinion of counsel or other evidence reasonably satisfactory to it as to
     the compliance with the restrictions set forth in the legend set forth in
     Section 2.3(e)(i) or (3) outside the United States in an offshore
     transaction within the meaning of Regulation S and in compliance with Rule
     904 under the Securities Act; and

          (ii) written instructions directing the Trustee to make, or to direct
     the Securities Custodian to make, an adjustment on its books and records
     with respect to such Global Security to reflect an increase in the
     aggregate principal amount of the Securities represented by the Global
     Security, such instructions to contain information regarding the Depositary
     account to be credited with such increase, then the Trustee shall cancel
     such Definitive Security and cause, or direct the Securities Custodian to
     cause, in accordance with the standing instructions and procedures existing
     between the Depositary and the Securities Custodian, the aggregate
     principal amount of Securities represented by the Global Security to be
     increased by the aggregate principal amount of the Definitive Security to
     be exchanged and shall credit or cause to be credited to the account of the
     Person specified in such instructions a beneficial interest in the Global
     Security equal to the principal amount of the Definitive Security so
     canceled. If no Global Securities are then outstanding and the Global
     Security has not been previously exchanged for certificated securities
     pursuant to Section 2.4, the Company shall issue and the Trustee shall
     authenticate, upon written order of the Company in the form of an Officers'
     Certificate, a new Global Security in the appropriate principal amount.

          (c) TRANSFER AND EXCHANGE OF GLOBAL SECURITIES. (i) The transfer and
exchange of Global Securities or beneficial interests therein shall be effected
through the Depositary, in accordance with this Indenture (including applicable
restrictions on transfer set forth herein, if any) and the procedures of the
Depositary therefor. A transferor of a beneficial interest in a Global Security
shall deliver a written order given in accordance with the Depositary's
procedures containing information regarding the participant account of the
Depositary to be credited with a beneficial interest in such Global Security or
another Global Security and such account shall be credited in accordance with
such order with a beneficial interest in the applicable Global Security and the
account of the Person making the transfer shall be debited by an amount equal to
the beneficial interest in the Global Security being transferred. Transfers by
an owner of a beneficial interest in the Rule 144A Global Security or the IAI
Global Security to a transferee who takes delivery of such interest through the
Regulation S Global Security,



                                                                               7

whether before or after the expiration of the Restricted Period, shall be made
only upon receipt by the Trustee of a certification in the form provided on the
reverse of the Initial Securities from the transferor to the effect that such
transfer is being made in accordance with Regulation S or (if available) Rule
144 under the Securities Act. In the case of a transfer of a beneficial interest
in the Rule 144A Global Security for an interest in the IAI Global Security, the
transferee must furnish a signed letter substantially in the form of Exhibit D
to the Trustee and an opinion of counsel or other evidence reasonably
satisfactory to the Trustee as to the compliance with the restrictions set forth
in the legend set forth in Section 2.3(e)(i).

          (ii) If the proposed transfer is a transfer of a beneficial interest
     in one Global Security to a beneficial interest in another Global Security,
     the Registrar shall reflect on its books and records the date and an
     increase in the principal amount of the Global Security to which such
     interest is being transferred in an amount equal to the principal amount of
     the interest to be so transferred, and the Registrar shall reflect on its
     books and records the date and a corresponding decrease in the principal
     amount of Global Security from which such interest is being transferred.

          (iii) Notwithstanding any other provisions of this Appendix (other
     than the provisions set forth in Section 2.4), a Global Security may not be
     transferred as a whole except by the Depositary to a nominee of the
     Depositary or by a nominee of the Depositary to the Depositary or another
     nominee of the Depositary or by the Depositary or any such nominee to a
     successor Depositary or a nominee of such successor Depositary.

          (iv) In the event that a Global Security is exchanged for Definitive
     Securities pursuant to Section 2.4 prior to the consummation of the
     Registered Exchange Offer or the effectiveness of the Shelf Registration
     Statement with respect to such Securities, such Securities may be exchanged
     only in accordance with such procedures as are substantially consistent
     with the provisions of this Section 2.3 (including the certification
     requirements set forth on the reverse of the Initial Securities intended to
     ensure that such transfers comply with Rule 144A or such other applicable
     exemption from registration under the Securities Act, as the case may be)
     and such other procedures as may from time to time be adopted by the
     Company.

          (d) RESTRICTIONS ON TRANSFER OF REGULATION S GLOBAL SECURITY. (i)
During the Restricted Period, beneficial ownership interests in the Regulation S
Global Security may only be sold, pledged or transferred in accordance with the
Applicable Procedures and only (1) to the Company, (2) so long as such security
is eligible for resale pursuant to Rule 144A, to a person whom the selling
holder reasonably believes is a QIB that purchases for its own account or for
the account of a QIB to whom notice is given that the resale, pledge or transfer
is being made in reliance on Rule 144A, (3) in an offshore transaction in
accordance with Regulation S, (4) pursuant to an exemption from registration
under the Securities Act provided by Rule 144 (if applicable) under the
Securities Act, (5) to an IAI purchasing for its own account, or for the account
of such an



                                                                               8

IAI, in a minimum principal amount of Securities of $250,000 or (6) pursuant to
an effective registration statement under the Securities Act, in each case in
accordance with any applicable securities laws of any state of the United
States. Prior to the expiration of the Restricted Period, transfers by an owner
of a beneficial interest in the Regulation S Global Security to a transferee who
takes delivery of such interest through the Rule 144A Global Security or the IAI
Global Security shall be made only in accordance with Applicable Procedures and
upon receipt by the Trustee of a written certification from the transferor of
the beneficial interest in the form provided on the reverse of the Initial
Security to the effect that such transfer is being made to (1) a QIB within the
meaning of Rule 144A in a transaction meeting the requirements of Rule 144A or
(2) an IAI purchasing for its own account, or for the account of such an IAI, in
a minimum principal amount of the Securities of $250,000. Such written
certification shall no longer be required after the expiration of the Restricted
Period. In the case of a transfer of a beneficial interest in the Regulation S
Global Security for an interest in the IAI Global Security, the transferee must
furnish a signed letter substantially in the form of Exhibit D to the Trustee.

          (ii) Upon the expiration of the Restricted Period, beneficial
     ownership interests in the Regulation S Global Security shall be
     transferable in accordance with applicable law and the other terms of this
     Indenture.

          (e) LEGEND.

          (i) Except as permitted by the following paragraphs (ii), (iii) or
     (iv), each Security certificate evidencing the Global Securities and the
     Definitive Securities (and all Securities issued in exchange therefor or in
     substitution thereof) shall bear a legend in substantially the following
     form (each defined term in the legend being defined as such for purposes of
     the legend only):

     "THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
     AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR
     OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
     HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED
     OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
     TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.

     THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES ON ITS BEHALF
     AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED
     SECURITIES, TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO
     THE DATE (THE "RESALE RESTRICTION TERMINATION DATE") THAT IS [IN THE CASE
     OF RULE 144A AND IAI NOTES: TWO YEARS] [IN THE CASE OF REGULATION S NOTES:
     40 DAYS] AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST
     DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF
     THIS



                                                                               9

     SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE COMPANY,
     (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE
     UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE
     FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT
     REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE
     144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
     ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
     TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND
     SALES THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION
     S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL "ACCREDITED INVESTOR"
     WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES
     ACT THAT IS AN INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE SECURITY FOR
     ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED
     INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF THE SECURITIES OF
     $250,000, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR OFFER OR
     SALE IN CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT
     OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
     REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY'S AND THE
     TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO
     CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
     CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM. THIS
     LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE
     RESTRICTION TERMINATION DATE."

Each Definitive Security shall bear the following additional legend:

     "IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR
     AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER
     AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE
     FOREGOING RESTRICTIONS."

          (ii) Upon any sale or transfer of a Transfer Restricted Security that
     is a Definitive Security, the Registrar shall permit the Holder thereof to
     exchange such Transfer Restricted Security for a Definitive Security that
     does not bear the legends set forth above and rescind any restriction on
     the transfer of such Transfer Restricted Security if the Holder certifies
     in writing to the Registrar that its request for such exchange was made in
     reliance on Rule 144 (such certification to be in the form set forth on the
     reverse of the Initial Security, or Private Exchange Note, as applicable)
     and delivers an opinion of counsel or other evidence



                                                                              10

     reasonably satisfactory to the Registrar as to the compliance with the
     restrictions set forth in the legend set forth in Section 2.3(e)(i)).

          (iii) After a transfer of any Initial Securities or Private Exchange
     Notes during the period of the effectiveness of a Shelf Registration
     Statement with respect to such Initial Securities or Private Exchange
     Notes, as the case may be, all requirements pertaining to the Restricted
     Securities Legend on such Initial Securities or such Private Exchange Notes
     shall cease to apply and the requirements that any such Initial Securities
     or such Private Exchange Notes be issued in global form shall continue to
     apply.

          (iv) Upon the consummation of a Registered Exchange Offer with respect
     to the Initial Securities pursuant to which Holders of such Initial
     Securities are offered Exchange Notes in exchange for their Initial
     Securities, all requirements pertaining to Initial Securities that Initial
     Securities be issued in global form shall continue to apply, and Exchange
     Notes in global form without the Restricted Securities Legend shall be
     available to Holders that exchange such Initial Securities in such
     Registered Exchange Offer.

          (v) Upon the consummation of a Private Exchange with respect to the
     Initial Securities pursuant to which Holders of such Initial Securities are
     offered Private Exchange Notes in exchange for their Initial Securities,
     all requirements pertaining to such Initial Securities that Initial
     Securities be issued in global form shall continue to apply, and Private
     Exchange Notes in global form with the Restricted Securities Legend shall
     be available to Holders that exchange such Initial Securities in such
     Private Exchange.

          (vi) Upon a sale or transfer after the expiration of the Restricted
     Period of any Initial Security acquired pursuant to Regulation S, all
     requirements that such Initial Security bear the Restricted Securities
     Legend shall cease to apply and the requirements requiring any such Initial
     Security be issued in global form shall continue to apply.

          (vii) Any Additional Securities sold in a registered offering shall
     not be required to bear the Restricted Notes Legend.

          (f) CANCELATION OR ADJUSTMENT OF GLOBAL SECURITY. At such time as all
beneficial interests in a Global Security have either been exchanged for
Definitive Securities, transferred, redeemed, repurchased or canceled, such
Global Security shall be returned by the Depositary to the Trustee for
cancelation or retained and canceled by the Trustee. At any time prior to such
cancelation, if any beneficial interest in a Global Security is exchanged for
Definitive Securities, transferred in exchange for an interest in another Global
Security, redeemed, repurchased or canceled, the principal amount of Securities
represented by such Global Security shall be reduced and an adjustment shall be
made on the books and records of the Trustee (if it is then the Securities
Custodian for such Global Security) with respect to such Global Security, by the
Trustee or the Securities Custodian, to reflect such reduction.



                                                                              11

          (g) OBLIGATIONS WITH RESPECT TO TRANSFERS AND EXCHANGES OF SECURITIES.

          (i) To permit registrations of transfers and exchanges, the Company
     shall execute and the Trustee shall authenticate, Definitive Securities and
     Global Securities at the Registrar's request.

          (ii) No service charge shall be made for any registration of transfer
     or exchange, but the Company may require payment of a sum sufficient to
     cover any transfer tax, assessments, or similar governmental charge payable
     in connection therewith (other than any such transfer taxes, assessments or
     similar governmental charge payable upon exchanges to be registered in the
     name of the registered Holder effecting the exchange pursuant to Sections
     2.06, 3.06, 4.06, 4.08 and 9.05 of this Indenture).

          (iii) Prior to the due presentation for registration of transfer of
     any Security, the Company, the Trustee, the Paying Agent or the Registrar
     may deem and treat the person in whose name a Security is registered as the
     absolute owner of such Security for the purpose of receiving payment of
     principal of and interest on such Security and for all other purposes
     whatsoever, whether or not such Security is overdue, and none of the
     Company, the Trustee, the Paying Agent or the Registrar shall be affected
     by notice to the contrary.

          (iv) All Securities issued upon any transfer or exchange pursuant to
     the terms of this Indenture shall evidence the same debt and shall be
     entitled to the same benefits under this Indenture as the Securities
     surrendered upon such transfer or exchange.

          (h) NO OBLIGATION OF THE TRUSTEE.

          (i) The Trustee shall have no responsibility or obligation to any
     beneficial owner of a Global Security, a member of, or a participant in the
     Depositary or any other Person with respect to the accuracy of the records
     of the Depositary or its nominee or of any participant or member thereof,
     with respect to any ownership interest in the Securities or with respect to
     the delivery to any participant, member, beneficial owner or other Person
     (other than the Depositary) of any notice (including any notice of
     redemption or repurchase) or the payment of any amount, under or with
     respect to such Securities. All notices and communications to be given to
     the Holders and all payments to be made to Holders under the Securities
     shall be given or made only to the registered Holders (which shall be the
     Depositary or its nominee in the case of a Global Security). The rights of
     beneficial owners in any Global Security shall be exercised only through
     the Depositary subject to the applicable rules and procedures of the
     Depositary. The Trustee may rely and shall be fully protected in relying
     upon information furnished by the Depositary with respect to its members,
     participants and any beneficial owners.



                                                                              12

          (ii) The Trustee shall have no obligation or duty to monitor,
     determine or inquire as to compliance with any restrictions on transfer
     imposed under this Indenture or under applicable law with respect to any
     transfer of any interest in any Security (including any transfers between
     or among Depositary participants, members or beneficial owners in any
     Global Security) other than to require delivery of such certificates and
     other documentation or evidence as are expressly required by, and to do so
     if and when expressly required by, the terms of this Indenture, and to
     examine the same to determine substantial compliance as to form with the
     express requirements hereof.

     2.4 DEFINITIVE SECURITIES

          (a) A Global Security deposited with the Depositary or with the
Trustee as Securities Custodian pursuant to Section 2.1 or issued in connection
with a Registered Exchange Offer or Private Exchange shall be transferred to the
beneficial owners thereof in the form of Definitive Securities in an aggregate
principal amount equal to the principal amount of such Global Security, in
exchange for such Global Security, only if such transfer complies with Section
2.3 and (i) the Depositary notifies the Company that it is unwilling or unable
to continue as a Depositary for such Global Security or if at any time the
Depositary ceases to be a "clearing agency" registered under the Exchange Act,
and a successor depositary is not appointed by the Company within 90 days of
such notice or after the Company becomes aware of such cessation, or (ii) an
Event of Default has occurred and is continuing or (iii) the Company, in its
sole discretion, notifies the Trustee in writing that it elects to cause the
issuance of certificated Securities under this Indenture.

          (b) Any Global Security that is transferable to the beneficial owners
thereof pursuant to this Section 2.4 shall be surrendered by the Depositary to
the Trustee, to be so transferred, in whole or from time to time in part,
without charge, and the Trustee shall authenticate and deliver, upon such
transfer of each portion of such Global Security, an equal aggregate principal
amount of Definitive Securities of authorized denominations. Any portion of a
Global Security transferred pursuant to this Section shall be executed,
authenticated and delivered only in denominations of $1,000 principal amount and
any integral multiple thereof and registered in such names as the Depositary
shall direct. Any certificated Initial Security in the form of a Definitive
Security delivered in exchange for an interest in the Global Security shall,
except as otherwise provided by Section 2.3(d), bear the Restricted Securities
Legend.

          (c) Subject to the provisions of Section 2.4(b), the registered Holder
of a Global Security may grant proxies and otherwise authorize any Person,
including Agent Members and Persons that may hold interests through Agent
Members, to take any action which a Holder is entitled to take under this
Indenture or the Securities.

          (d) In the event of the occurrence of any of the events specified in
Section 2.4(a)(i), (ii) or (iii), the Company will promptly make available to
the Trustee a reasonable supply of Definitive Securities in fully registered
form without interest coupons.



                                                                     EXHIBIT A-1

                        [FORM OF FACE OF INITIAL SECURITY
                 AND PRIVATE EXCHANGE NOTE-CONSENTING SECURITY]

                           [Global Securities Legend]

          UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW
YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

          TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO DTC, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR
SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL
BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.

                         [Restricted Securities Legend]

          THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR
OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.

          THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES ON ITS
BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED
SECURITIES, TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE
DATE (THE "RESALE RESTRICTION TERMINATION DATE") THAT IS [IN THE CASE OF RULE
144A OR IAI NOTES: TWO YEARS] [IN THE CASE OF REGULATION S NOTES: 40 DAYS] AFTER
THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE
COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY
PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE COMPANY, (B) PURSUANT TO A
REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE



                                                                               2

UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT REASONABLY
BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING
MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES THAT OCCUR
OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE
SECURITIES ACT, (E) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING
OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS AN
INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT OR
FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A
MINIMUM PRINCIPAL AMOUNT OF THE SECURITIES OF $250,000, FOR INVESTMENT PURPOSES
AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION
IN VIOLATION OF THE SECURITIES ACT OR (F) PURSUANT TO ANOTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO
THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM.
THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE
RESTRICTION TERMINATION DATE.

          FOR UNITED STATES FEDERAL INCOME TAX PURPOSES, THIS INSTRUMENT IS
CONSIDERED TO BE ISSUED WITH ORIGINAL ISSUE DISCOUNT. FOR INFORMATION CONCERNING
THE ISSUE PRICE, AMOUNT OF ORIGINAL ISSUE DISCOUNT, ISSUE DATE AND YIELD TO
MATURITY OF THIS INSTRUMENT, CONTACT JOE KWEDERIS, SENIOR VICE-PRESIDENT FINANCE
OF THE ISSUER AT 1475 WOODFIELD ROAD, SUITE 700, SCHAUMBURG, ILLINOIS 60173,
TEL: (847) 407-5117.

          [Each Definitive Security shall bear the following additional legend]

          IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE
REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH
TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH
THE FOREGOING RESTRICTIONS.



                                                                               3

No.                                                                  $__________


                      11 5/8% Senior Secured Note due 2009

                                                          CUSIP No. ____________
                                                           ISIN No. ____________


          PLIANT CORPORATION, a Utah corporation, promises to pay to Cede & Co.,
or registered assigns, the principal amount [listed on the Schedule of Increases
or Decreases in Global Security attached hereto](1) [of $_____](2) on June 15,
2009.

          Interest Payment Dates:  June 15 and December 15.

          Record Dates:  June 1 and December 1.


- ----------
     (1) Insert if Security is to be issued in global form.

     (2) Insert if Security is to be issued in definitive form.



                                                                               4

          Additional provisions of this Security are set forth on the other side
of this Security.

          IN WITNESS WHEREOF, the parties have caused this instrument to be duly
executed.

PLIANT CORPORATION,

     by


           -------------------------------
     Name:

     Title:


     by


           -------------------------------
     Name:

     Title:


Dated:

TRUSTEE'S CERTIFICATE OF
     AUTHENTICATION

WILMINGTON TRUST COMPANY,

as Trustee, certifies that this is one of
the Securities referred to in the Indenture.

by

    -------------------------
       Authorized Signatory

- ----------
*/ If the Security is to be issued in global form, add the Global Securities
Legend and the attachment from Exhibit A captioned "TO BE ATTACHED TO GLOBAL



                                                                               5

SECURITIES - SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY".



                                                                               6

                    [FORM OF REVERSE SIDE OF INITIAL SECURITY
                 AND PRIVATE EXCHANGE NOTE-CONSENTING SECURITY]

                      11 5/8% Senior Secured Note due 2009

1.  INTEREST

          (a) PLIANT CORPORATION, a Utah corporation (such corporation, and its
successors and assigns under the Indenture hereinafter referred to, being herein
called the "Company"), promises to pay interest on the principal amount of this
Consenting Security at the rate per annum shown above.

          All references in this Consenting Security, in any context, to
interest or other amount payable on or with respect to the Consenting Securities
shall be deemed to include any Additional Interest pursuant to the Registration
Agreement.

          Interest on the Consenting Securities will accrue from the date of
issuance at a rate of 11 5/8% per annum until maturity, and will be payable
semiannually on each June 15 and December 15 commencing June 15, 2005, to
holders of record on the immediately preceding June 1 and December 1. On each
Interest Payment Date, the Company shall, in lieu of the payment of interest on
the Consenting Securities in cash, pay interest on the Consenting Securities
through the issuance of Additional Securities in an aggregate principal amount
equal to the aggregate amount of interest (rounded to the nearest whole cent)
that would be payable with respect to the Consenting Securities if such interest
were paid in cash. On or before each such Interest Payment Date, the Company
shall deliver to the Trustee and the Paying Agent [an order to increase the
principal amount of this Consenting Security by the amount required to pay such
interest (or, if requested by the Trustee or the Holder of this Consenting
Security, to authenticate a new global Security executed by the Company with
such increased principal amounts)](3) [new Additional Securities in the amount
required to pay such interest and an order to authenticate and deliver such
Additional Securities to the record Holder of this Consenting Security](4). Any
Additional Securities so issued shall be dated the applicable Interest Payment
Date, shall bear interest from and after such date, shall mature on June 15,
2009 and shall be governed by, and be subject to the terms of the Indenture and
shall have the same rights and benefits as the Consenting Securities. Interest
will be computed on the basis of a 360-day year comprised of twelve 30-day
months.

          (b) ADDITIONAL INTEREST. The holder of this Consenting Security is
entitled to the benefits of an Exchange and Registration Rights Agreement, dated
as of May 6, 2005, among the Company, Pliant Corporation International, Pliant
Film Products of Mexico, Inc., Pliant Packaging of Canada, LLC, Uniplast
Holdings Inc., Uniplast U.S.,

- ----------
    (3) Insert if the Security is to be issued in global form.

    (4) Insert if the Security is to be issued in definitive form.



                                                                               7

Inc., and Uniplast Industries Co. (the "Note Guarantors") and J.P. Morgan
Securities Inc. (the "Registration Agreement"). Capitalized terms used in this
paragraph (b) but not defined herein have the meanings assigned to them in the
Registration Agreement. Subject to the terms of the Registration Agreement, if
(i) the Shelf Registration Statement or Exchange Offer Registration Statement,
as applicable under the Registration Agreement, is not filed with the Commission
on or prior to the date specified in the Registration Agreement, (ii) the
Exchange Offer Registration Statement or the Shelf Registration Statement, as
the case may be, is not declared effective on or prior to the date specified in
the Registration Agreement, (iii) the Registered Exchange Offer is not
consummated on or prior to 190 days after the Issue Date (other than in the
event the Company files a Shelf Registration Statement), or (iv) the Shelf
Registration Statement is filed and declared effective on or prior to the date
specified in the Registration Agreement but shall thereafter cease to be
effective (at any time that the Company is obligated to maintain the
effectiveness thereof) without being succeeded within 60 days by an additional
Registration Statement filed and declared effective (each such event referred to
in clauses (i) through (iv), a "Registration Default"), the interest rate on
Securities constituting Transfer Restricted Securities, during the period of
such Registration Default, shall be increased by 1.0% per annum (the amount paid
as a result of such increase being herein referred to as "liquidated damages")
until the applicable Registration Statement is filed or declared effective, the
Registered Exchange Offer is consummated or the Shelf Registration Statement
again becomes effective, an additional Registration Statement becomes effective
or a post-effective amendment to the Shelf Registration Statement becomes
effective, as the case may be. Liquidated damages shall be payable through the
issuance of Additional Securities in the same manner and at the same time as
interest payments on the Consenting Securities. Following the cure of all
Registration Defaults, the accrual of liquidated damages shall cease. The
Trustee shall have no responsibility with respect to the determination of the
amount of any such liquidated damages. For purposes of the foregoing, "Transfer
Restricted Securities" means (i) each Initial Security until the date on which
such Initial Security has been exchanged for a freely transferable Exchange Note
in the Registered Exchange Offer, it being understood that the requirement that
an Exchange Dealer deliver a prospectus in connection with sales of Exchange
Notes acquired in the Registered Exchange Offer shall not mean that the Exchange
Note is not freely transferable, (ii) each Initial Security or Private Exchange
Note until the date on which such Initial Security or Private Exchange Note has
been effectively registered under the Securities Act and disposed of in
accordance with a Shelf Registration Statement or (iii) each Initial Security or
Private Exchange Note until the date on which such Initial Security or Private
Exchange Note is distributed to the public pursuant to Rule 144 under the
Securities Act or is saleable pursuant to Rule 144(k) under the Securities Act.
The Company shall not be responsible for liquidated damages with respect to any
Holder of Transfer Restricted Securities to the extent such Holder fails to
comply with certain obligations specified in the Registration Agreement.

2.  METHOD OF PAYMENT

          The Company shall pay interest on the Consenting Securities (except
defaulted interest) to the registered Holders at the close of business on the
June 1 and



                                                                               8

December 1 next preceding the Interest Payment Date even if the Consenting
Securities are canceled after the record date and on or before the Interest
Payment Date. Holders must surrender Consenting Securities to a Paying Agent to
collect principal payments. The Company shall pay principal, premium, if any,
and, except as set forth in paragraph 1, interest and liquidated damages, if
any, in money of the United States of America that at the time of payment is
legal tender for payment of public and private debts. Payments in respect of the
Consenting Securities represented by a Global Security (including principal and
premium, if any, and interest and liquidated damages, if any) shall be made by
wire transfer of immediately available funds to the accounts specified by The
Depository Trust Company or any successor depositary; PROVIDED that any such
payment of interest or liquidated damages in the form of Additional Securities
shall be made in accordance with paragraph 1. The Company will make all payments
in respect of a certificated Consenting Security (including principal and
premium, if any, and interest and liquidated damages, if any), at the office of
the Paying Agent; PROVIDED, HOWEVER, that payments on the Consenting Securities
may also be made, in the case of a Holder of at least $1,000,000 aggregate
principal amount of Consenting Securities, by wire transfer to a U.S. dollar
account maintained by the payee with a bank in the United States if such Holder
elects payment by wire transfer by giving written notice to the Trustee or the
Paying Agent to such effect designating such account no later than 30 days
immediately preceding the relevant due date for payment (or such other date as
the Trustee may accept in its discretion); PROVIDED further that any such
payment of interest or liquidated damages in the form of Additional Securities
shall be made in accordance with paragraph 1.

3.  PAYING AGENT AND REGISTRAR

          Initially, WILMINGTON TRUST COMPANY, a Delaware banking corporation
(the "Trustee"), will act as Paying Agent and Registrar. The Company may appoint
and change any Paying Agent or Registrar without notice. The Company or any of
its domestically incorporated Wholly Owned Subsidiaries may act as Paying Agent
or Registrar.

4.  INDENTURE

          The Company issued the Securities under an Indenture dated as of
February 17, 2004, as amended and restated as of May 6, 2005, (as amended and
restated, the "Indenture"), among the Company, the Note Guarantors and the
Trustee. The terms of the Securities include those stated in the Indenture and
those made part of the Indenture by reference to the Trust Indenture Act of 1939
(15 U.S.C. Sections 77aaa-77bbbb) as in effect on the date of the Indenture (the
"TIA"). Terms defined in the Indenture and not defined herein have the meanings
ascribed thereto in the Indenture. The Securities are subject to all terms and
provisions of the Indenture, and Holders (as defined in the Indenture) are
referred to the Indenture and the TIA for a statement of such terms and
provisions.

          The Securities are senior secured obligations of the Company. The
Company shall be entitled, subject to its compliance with Section 4.03 of the
Indenture,



                                                                               9

to issue Additional Securities pursuant to Section 2.01 of the Indenture. This
Security is one of the [Consenting Securities] [Additional Securities] [Private
Exchange Notes] referred to in the Indenture. The Securities include the
Consenting Securities, Non-Consenting Securities, the Additional Securities and
any Exchange Notes and Private Exchange Notes issued in exchange for the Initial
Securities pursuant to the Indenture. The Consenting Securities, the
Non-Consenting Securities, the Additional Securities and any Exchange Notes and
Private Exchange Notes are treated as a single class of securities under the
Indenture, except as specifically stated otherwise therein. The Indenture
imposes certain limitations on the ability of the Company and its Restricted
Subsidiaries to, among other things, make certain Investments and other
Restricted Payments, pay dividends and other distributions, incur Indebtedness,
enter into consensual restrictions upon the payment of certain dividends and
distributions by such Restricted Subsidiaries, enter into or permit certain
transactions with Affiliates, make asset sales and incur Liens. The Indenture
also imposes limitations on the ability of the Company and each Note Guarantor
to consolidate or merge with or into any other Person or the Company to convey,
transfer or lease all or substantially all of its property.

          To guarantee the due and punctual payment of the principal, interest
and liquidated damages, if any, on the Securities and all other amounts payable
by the Company under the Indenture and the Securities when and as the same shall
be due and payable, whether at maturity, by acceleration or otherwise, according
to the terms of the Securities and the Indenture, the Note Guarantors have,
jointly and severally, unconditionally guaranteed the Guaranteed Obligations on
a senior secured basis pursuant to the terms of the Indenture.

          The Securities are secured (i) on a first-priority basis with respect
to the First-Priority Collateral and (ii) on a second-priority basis with
respect to the Second-Priority Collateral, in each case, by the Liens created by
the Security Documents pursuant to, and subject to, the terms of the Indenture
and the Intercreditor Agreement.

5.  OPTIONAL REDEMPTION

          Except as set forth in the following paragraph, the Consenting
Securities shall not be redeemable at the option of the Company prior to June
15, 2007. On or after June 15, 2007, the Consenting Securities shall be
redeemable at the option of the Company, in whole or in part, on not less than
30 nor more than 60 days prior notice, at the following redemption prices
(expressed as percentages of the sum of the principal amount plus accrued and
unpaid interest and liquidated damages, if any, to the redemption date (subject
to the right of Holders of record on the relevant record date to receive
interest and liquidated damages, if any, due on the relevant Interest Payment
Date)), if redeemed during the six-month period commencing on the date set forth
below (or, in the case of June 15, 2009, on such date):



                                                           REDEMPTION
         YEAR                                                 PRICE
         ------------------------------------------------------------
                                                         
         June 15, 2007                                      111.625%




                                                                              10



                                                           REDEMPTION
         YEAR                                                 PRICE
         ------------------------------------------------------------
                                                         
         December 15, 2007                                  108.719%
         June 15, 2008                                      105.813%
         December 15, 2008                                  102.906%
         June 15, 2009                                      100.000%


          In addition, prior to June 15, 2007, the Company may redeem up to a
maximum of 35% of the principal amount of the Consenting Securities (calculated
after giving effect to any issuance of Additional Securities) with the Net Cash
Proceeds of one or more Equity Offerings by the Company at a redemption price
equal to 111.625% of the sum of the principal amount plus accrued and unpaid
interest and liquidated damages, if any, thereon at the date of redemption;
PROVIDED, HOWEVER, that after giving effect to any such redemption, at least 65%
of the principal amount of the Consenting Securities (calculated after giving
effect to any issuance of Additional Securities) remains outstanding, and any
such redemption shall be made within 120 days of such Equity Offering upon not
less than 30 nor more than 60 days notice mailed to each Holder of Consenting
Securities being redeemed and otherwise in accordance with the procedures set
forth in the Indenture.

6.  SINKING FUND

          The Consenting Securities are not subject to any sinking fund.

7.  NOTICE OF REDEMPTION

          Notice of redemption will be mailed by first-class mail at least 30
days but not more than 60 days before the redemption date to each Holder of
Consenting Securities to be redeemed at his or her registered address.
Consenting Securities in denominations larger than $1,000 principal amount may
be redeemed in part but only in whole multiples of $1,000 principal amount. If
money sufficient to pay the redemption price of and accrued and unpaid interest
and liquidated damages, if any, on all Consenting Securities (or portions
thereof) to be redeemed on the redemption date is deposited with the Paying
Agent on or before the redemption date and certain other conditions are
satisfied, on and after such date interest and liquidated damages, if any, cease
to accrue on such Consenting Securities (or such portions thereof) called for
redemption.

8.  REPURCHASE OF SECURITIES AT THE OPTION OF HOLDERS UPON CHANGE OF CONTROL

          Upon a Change of Control, any Holder of Consenting Securities will
have the right, subject to certain conditions specified in the Indenture, to
cause the Company to repurchase all or any part of the Consenting Securities of
such Holder at a purchase price equal to 101% of the sum of the principal amount
of the Consenting Securities to be repurchased plus accrued and unpaid interest
and liquidated damages, if any, to the date of repurchase (subject to the right
of the Holders of record on the relevant record date to receive interest due and
liquidated damages, if any, on the relevant Interest Payment Date



                                                                              11

that is on or prior to the date of purchase) as provided in, and subject to the
terms of, the Indenture.

          In accordance with Section 4.06 of the Indenture, the Company will be
required to offer to purchase Consenting Securities upon the occurrence of
certain events.

9.  DENOMINATIONS; TRANSFER; EXCHANGE

          The Consenting Securities are in registered form without coupons in
denominations of $1,000 principal amount and whole multiples of $1,000 principal
amount; provided that (x) the aggregate principal amount of the Consenting
Securities issued on the Closing Date shall equal the aggregate Accreted Value
as of the Closing Date of the Existing Securities with respect to which consents
to the Amendments were given and accepted by the Company, which is $250,607,280
and (y) the aggregate principal amount of the Exchange Notes and Private
Exchange Notes issued in exchange for any Consenting Securities shall equal the
aggregate principal amount of such Consenting Securities; provided further that
Additional Securities issued as payment of interest on the Consenting Securities
shall be issued in denominations of $0.01 and integral multiples of $0.01. A
Holder may transfer or exchange Consenting Securities in accordance with, and
subject to the restrictions on transfer and exchange set forth in, the
Indenture. Upon any transfer or exchange, the Registrar and the Trustee may
require a Holder, among other things, to furnish appropriate endorsements or
transfer documents and to pay any taxes required by law or permitted by the
Indenture. The Registrar need not register the transfer of or exchange any
Consenting Securities selected for redemption (except, in the case of a
Consenting Security to be redeemed in part, the portion of the Security not to
be redeemed) or to transfer or exchange any Securities for a period of 15 days
prior to a selection of Consenting Securities to be redeemed.

10. PERSONS DEEMED OWNERS

          Except as provided in paragraph 2 hereof, the registered Holder of
this Consenting Security may be treated as the owner of it for all purposes.

11. UNCLAIMED MONEY

          If money for the payment of principal, interest or liquidated damages,
if any, remains unclaimed for two years, the Trustee and the Paying Agent shall
pay the money back to the Company at its written request unless an abandoned
property law designates another Person. After any such payment, Holders entitled
to the money must look only to the Company for payment and not to the Trustee
for payment as general creditors and the Trustee and the Paying Agent shall have
no further liability with respect to such monies.

12. DISCHARGE AND DEFEASANCE

          Subject to certain conditions, the Company at any time may terminate
some of or all its obligations under the Securities and the Indenture if the
Company deposits with the Trustee money or U.S. Government Obligations for the
payment of



                                                                              12

principal of, and interest and liquidated damages, if any, on, the Securities to
redemption or maturity, as the case may be.

13. AMENDMENT, WAIVER

          Subject to certain exceptions set forth in the Indenture, (i) the
Indenture, the Securities, the Security Documents or the Intercreditor Agreement
may be amended without prior notice to any Holder but with the written consent
of the Holders of at least a majority in aggregate principal amount of the
outstanding Securities; PROVIDED that without the consent of the Holders of at
least 66 2/3% in aggregate principal amount of the outstanding Securities, no
amendment or waiver may (x) release any Collateral from the Lien of the
Indenture and the Security Documents (except as permitted by the terms of the
Security Documents or the Intercreditor Agreement), (y) change the provisions
applicable to the application of the proceeds from the sale of Collateral or (z)
change or alter the priority of the security interests in the Collateral and
(ii) any default or compliance with any provisions of the Indenture may be
waived with the written consent of the Holders of at least a majority in
principal amount of the outstanding Securities. Subject to certain exceptions
set forth in the Indenture, without the consent of any Holder, the Company, the
Note Guarantors and the Trustee may amend the Indenture or the Securities (i) to
cure any ambiguity, omission, defect or inconsistency; (ii) to comply with
Article 5 of the Indenture; (iii) to provide for uncertificated Securities in
addition to or in place of certificated Securities; (iv) to add Note Guarantees
with respect to the Securities or to secure further the Securities; (v) to add
additional covenants or to surrender rights and powers conferred on the Company;
(vi) to comply with the requirements of the SEC in order to effect or maintain
the qualification of the Indenture under the TIA; (vii) to make any change that
does not materially and adversely affect the rights of any Holder under the
provisions of the Indenture; (viii) to provide for the issuance of the
Additional Securities, the Exchange Notes or Private Exchange Notes; and (ix) if
necessary, in connection with any addition or release of Collateral permitted
under the terms of the Indenture or the Security Documents.

14. DEFAULTS AND REMEDIES

          If an Event of Default occurs (other than an Event of Default relating
to certain events of bankruptcy, insolvency or reorganization of the Company)
and is continuing, the Trustee or the Holders of at least 25% in principal
amount of the outstanding Securities may declare the principal of and accrued
but unpaid interest on all the Securities to be due and payable. If an Event of
Default relating to certain events of bankruptcy, insolvency or reorganization
of the Company occurs, the principal of and interest on all the Securities shall
become immediately due and payable without any declaration or other act on the
part of the Trustee or any Holders. Under certain circumstances, the Holders of
a majority in principal amount of the outstanding Securities may rescind any
such acceleration with respect to the Securities and its consequences.

          If an Event of Default occurs and is continuing, the Trustee shall be
under no obligation to exercise any of the rights or powers under the Indenture
at the request or direction of any of the Holders unless such Holders have
offered to the Trustee



                                                                              13

reasonable indemnity or security against any loss, liability or expense and
certain other conditions are complied with. Except to enforce the right to
receive payment of principal, premium (if any) or interest when due, no Holder
may pursue any remedy with respect to the Indenture or the Securities unless (i)
such Holder has previously given the Trustee notice that an Event of Default is
continuing, (ii) Holders of at least 25% in principal amount of the outstanding
Securities have requested the Trustee in writing to pursue the remedy, (iii)
such Holders have offered the Trustee reasonable security or indemnity against
any loss, liability or expense, (iv) the Trustee has not complied with such
request within 60 days after the receipt of the request and the offer of
security or indemnity and (v) the Holders of a majority in principal amount of
the outstanding Securities have not given the Trustee a direction inconsistent
with such request within such 60-day period. Subject to certain restrictions,
the Holders of a majority in principal amount of the outstanding Securities are
given the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or of exercising any trust or
power conferred on the Trustee. The Trustee, however, may refuse to follow any
direction that conflicts with law or the Indenture or that the Trustee
determines is unduly prejudicial to the rights of any other Holder or that would
involve the Trustee in personal liability. Prior to taking any action under the
Indenture, the Trustee shall be entitled to indemnification or security
reasonably satisfactory to it against all losses and expenses caused by taking
or not taking such action.

15. TRUSTEE DEALINGS WITH THE COMPANY

          Subject to certain limitations imposed by the TIA, the Trustee under
the Indenture, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with and collect obligations owed
to it by the Company, a Note Guarantor or its Affiliates and may otherwise deal
with the Company, a Note Guarantor or its Affiliates with the same rights it
would have if it were not Trustee.

16. NO RECOURSE AGAINST OTHERS

          A director, officer, employee or stockholder, as such, of the Company
or any Note Guarantor shall not have any liability for any obligations of the
Company or any Note Guarantor under the Securities or the Indenture or for any
claim based on, in respect of or by reason of such obligations or their
creation. By accepting a Security, each Holder waives and releases all such
liability. The waiver and release are part of the consideration for the issue of
the Securities.

17. AUTHENTICATION

          This Consenting Security shall not be valid until an authorized
signatory of the Trustee (or an authenticating agent) manually signs the
certificate of authentication on the other side of this Security.

18. ABBREVIATIONS

          Customary abbreviations may be used in the name of a Holder or an
assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the



                                                                              14

entireties), JT TEN (=joint tenants with rights of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).

19. GOVERNING LAW

          THIS CONSENTING SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO
APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF
THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

20. CUSIP AND ISIN NUMBERS

          The Company has caused CUSIP and ISIN numbers to be printed on the
Consenting Securities and has directed the Trustee to use CUSIP and ISIN numbers
in notices of redemption as a convenience to Holders. No representation is made
as to the accuracy of such numbers either as printed on the Consenting
Securities or as contained in any notice of redemption and reliance may be
placed only on the other identification numbers placed thereon.

21. DESIGNATED SENIOR INDEBTEDNESS

          For purposes of the Senior Subordinated Notes Indentures, the
Securities and the Note Guarantees shall constitute Designated Senior
Indebtedness (as such term is defined in the Senior Subordinated Notes
Indentures) of the Company and the Note Guarantors, as the case may be.

          THE COMPANY WILL FURNISH TO ANY HOLDER OF CONSENTING SECURITIES UPON
WRITTEN REQUEST AND WITHOUT CHARGE TO THE HOLDER A COPY OF THE INDENTURE WHICH
HAS IN IT THE TEXT OF THIS CONSENTING SECURITY.



                                                                              15


                                 ASSIGNMENT FORM

To assign this Security, fill in the form below:


I or we assign and transfer this Security to

________________________________________________________________________________
            (Print or type assignee's name, address and zip code)

________________________________________________________________________________
                (Insert assignee's soc. sec. or tax I.D. No.)

and irrevocably appoint            agent to transfer this Security on the books
of the Company. The agent may substitute another to act for him.

Date:                    Your Signature:
     ------------------                 ---------------------

(Sign exactly as your name appears on the other side of this Security.)


Signature Guarantee:

Date:
     --------------------             --------------------------
Signature must be guaranteed          Signature of Signature
by a participant in a                 Guarantee
recognized signature guaranty
medallion program or other
signature guarantor acceptable
to the Trustee



                                                                              16

      CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION OF TRANSFER
                              RESTRICTED SECURITIES

This certificate relates to $_________ principal amount of Securities held in
(check applicable space) _____ book-entry or _____ definitive form by the
undersigned.

The undersigned (check one box below):

/ /  has requested the Trustee by written order to deliver in exchange for its
     beneficial interest in the Global Security held by the Depositary a
     Security or Securities in definitive, registered form of authorized
     denominations and an aggregate principal amount equal to its beneficial
     interest in such Global Security (or the portion thereof indicated above);

/ /  has requested the Trustee by written order to exchange or register the
     transfer of a Security or Securities.

In connection with any transfer of any of the Securities evidenced by this
certificate, the undersigned confirms that such Securities are being transferred
in accordance with its terms:

CHECK ONE BOX BELOW

(1)  / /   to the Company; or

(2)  / /   to the Registrar for registration in the name of the Holder, without
           transfer; or

(3)  / /   pursuant to an effective registration statement under the Securities
           Act of 1933; or

(4)  / /   inside the United States to a "qualified institutional buyer" (as
           defined in Rule 144A under the Securities Act of 1933) that purchases
           for its own account or for the account of a qualified institutional
           buyer to whom notice is given that such transfer is being made in
           reliance on Rule 144A, in each case pursuant to and in compliance
           with Rule 144A under the Securities Act of 1933; or

(5)  / /   outside the United States in an offshore transaction within the
           meaning of Regulation S under the Securities Act of 1933 in
           compliance with Rule 904 under the Securities Act of 1933 and such
           security shall be held immediately after the transfer through
           Euroclear or Clearstream until the expiration of the Restricted
           Period (as defined in the Indenture); or

(6)  / /   to an institutional "accredited investor" (as defined in Rule
           501(a)(1), (2), (3) or (7) under the Securities Act of 1933) that has
           furnished to the Trustee a signed letter containing certain
           representations and agreements; or



                                                                              17

(7)  / /   pursuant to another available exemption from registration provided by
           Rule 144 under the Securities Act of 1933.

           Unless one of the boxes is checked, the Trustee will refuse to
     register any of the Securities evidenced by this certificate in the name of
     any Person other than the registered Holder thereof; PROVIDED, HOWEVER,
     that if box (5), (6) or (7) is checked, the Trustee may require, prior to
     registering any such transfer of the Securities, such legal opinions,
     certifications and other information required by the Indenture to confirm
     that such transfer is being made pursuant to an exemption from, or in a
     transaction not subject to, the registration requirements of the Securities
     Act of 1933.

                                          ------------------------
                                          Your Signature

Signature Guarantee:

Date:
      -------------------             --------------------------
Signature must be guaranteed          Signature of Signature
by a participant in a                 Guarantee
recognized signature guaranty
medallion program or other
signature guarantor acceptable
to the Trustee



                                                                              18

              TO BE COMPLETED BY PURCHASER IF (4) ABOVE IS CHECKED.

          The undersigned represents and warrants that it is purchasing this
Security for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, and is aware that the sale to it is being made in reliance on Rule 144A
and acknowledges that it has received such information regarding the Company as
the undersigned has requested pursuant to Rule 144A or has determined not to
request such information and that it is aware that the transferor is relying
upon the undersigned's foregoing representations in order to claim the exemption
from registration provided by Rule 144A.

Dated:
      -----------------             ------------------------------
                                    NOTICE: To be executed by
                                            an executive officer



                                                                              19

                      [TO BE ATTACHED TO GLOBAL SECURITIES]

              SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY

          The initial principal amount of this Global Security is $[    ]. The
following increases or decreases in this Global Security have been made:



             Amount of decrease in       Amount of increase in      Principal amount of this    Signature of authorized
Date of      principal  amount of this   principal amount of this   Global Security following   signatory of Trustee or
Exchange     Global Security             Global Security            such decrease or increase   Securities Custodian
                                                                                    





                                                                              20

                       OPTION OF HOLDER TO ELECT PURCHASE

          IF YOU WANT TO ELECT TO HAVE THIS SECURITY PURCHASED BY THE COMPANY
PURSUANT TO SECTION 4.06 (ASSET DISPOSITION) OR 4.08 (CHANGE OF CONTROL) OF THE
INDENTURE, CHECK THE BOX:

                   ASSET DISPOSITION / / CHANGE OF CONTROL / /

          IF YOU WANT TO ELECT TO HAVE ONLY PART OF THIS SECURITY PURCHASED BY
THE COMPANY PURSUANT TO SECTION 4.06 OR 4.08 OF THE INDENTURE, STATE THE AMOUNT
($1,000 PRINCIPAL AMOUNT OR AN INTEGRAL MULTIPLE THEREOF):

$


DATE:                      YOUR SIGNATURE:
     ---------------------                 -------------------
(SIGN EXACTLY AS YOUR NAME APPEARS ON THE OTHER SIDE OF THE SECURITY)


SIGNATURE GUARANTEE:
                    ---------------------------------------
                    SIGNATURE MUST BE GUARANTEED BY A PARTICIPANT IN A
                    RECOGNIZED SIGNATURE GUARANTY MEDALLION PROGRAM OR OTHER
                    SIGNATURE GUARANTOR ACCEPTABLE TO THE TRUSTEE



                                                                     EXHIBIT B-1

               [FORM OF FACE OF EXCHANGE NOTE-CONSENTING SECURITY]

                           [GLOBAL SECURITIES LEGEND]

          UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW
YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

          TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO DTC, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR
SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL
BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.

          FOR UNITED STATES FEDERAL INCOME TAX PURPOSES, THIS INSTRUMENT IS
CONSIDERED TO BE ISSUED WITH ORIGINAL ISSUE DISCOUNT. FOR INFORMATION CONCERNING
THE ISSUE PRICE, AMOUNT OF ORIGINAL ISSUE DISCOUNT, ISSUE DATE AND YIELD TO
MATURITY OF THIS INSTRUMENT, CONTACT JOE KWEDERIS, SENIOR VICE-PRESIDENT FINANCE
OF THE ISSUER AT 1475 WOODFIELD ROAD, SUITE 700, SCHAUMBURG, ILLINOIS 60173,
TEL: (847) 407-5117.



                                                                               2

No.                                                                  $__________


                      11 5/8% Senior Secured Note due 2009

                                                            CUSIP No. __________
                                                             ISIN No. __________


          PLIANT CORPORATION, a Utah corporation, promises to pay to Cede & Co.,
or registered assigns, the principal amount [listed on the Schedule of Increases
or Decreases in Global Security attached hereto](1) [of $______](2) on June 15,
2009.

          Interest Payment Dates:  June 15 and December 15

          Record Dates:   June 1 and December 1.


- ----------
     (1) Insert if Security is to be issued in global form.

     (2) Insert if Security is to be issued in definitive form.



                                                                               3

          Additional provisions of this Security are set forth on the other side
of this Security.

          IN WITNESS WHEREOF, the parties have caused this instrument to be duly
executed.


                                  PLIANT CORPORATION,

                                    by

                                      --------------------------------
                                      Name:
                                      Title:

                                    by

                                      --------------------------------
                                      Name:
                                      Title:


Dated:

TRUSTEE'S CERTIFICATE OF
     AUTHENTICATION

WILMINGTON TRUST COMPANY,

as Trustee, certifies that this is one of
the Securities referred to in the Indenture.

     by

        -----------------------------
             Authorized Signatory


- ----------
*/ If the Security is to be issued in global form, add the Global Securities
Legend and the attachment from Exhibit A captioned "TO BE ATTACHED TO GLOBAL
SECURITIES - SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY".



                                                                               4

           [FORM OF REVERSE SIDE OF EXCHANGE NOTE-CONSENTING SECURITY]

                      11 5/8% Senior Secured Note due 2009

1.  INTEREST

          PLIANT CORPORATION, a Utah corporation (such corporation, and its
successors and assigns under the Indenture hereinafter referred to, being herein
called the "Company"), promises to pay interest on the principal amount of this
Consenting Security at the rate per annum shown above.

          Interest on the Consenting Securities will accrue from the date of
issuance at a rate of 11 5/8% per annum until maturity, and will be payable,
semiannually on each June 15 and December 15 commencing June 15, 2005, to
Holders of record on the immediately preceding June 1 and December 1. On each
Interest Payment Date, the Company shall, in lieu of the payment of interest on
the Consenting Securities in cash, pay interest on the Consenting Securities
through the issuance of Additional Securities in an aggregate principal amount
equal to the aggregate amount of interest (rounded to the nearest whole cent)
that would be payable with respect to the Consenting Securities if such interest
were paid in cash. On or before each such Interest Payment Date, the Company
shall deliver to the Trustee and the Paying Agent [an order to increase the
principal amount of this Consenting Security by the amount required to pay such
interest (or, if requested by the Trustee or the Holder of this Consenting
Security, to authenticate a new global Security executed by the Company with
such increased principal amounts)](3) [new Additional Securities in the amount
required to pay such interest and an order to authenticate and deliver such
Additional Securities to the record Holder of this Consenting Security](4). Any
Additional Securities so issued shall be dated the applicable Interest Payment
Date, shall bear interest from and after such date, shall mature on June 15,
2009 and shall be governed by, and be subject to the terms of the Indenture and
shall have the same rights and benefits as the Consenting Securities. Interest
will be computed on the basis of a 360-day year comprised of twelve 30-day
months.

2.  METHOD OF PAYMENT

          The Company shall pay interest on the Consenting Securities (except
defaulted interest) to the registered Holders at the close of business on the
June 1 and December 1 next preceding the Interest Payment Date even if the
Consenting Securities are canceled after the record date and on or before the
Interest Payment Date. Holders must surrender Consenting Securities to a Paying
Agent to collect principal payments. The Company shall pay principal and
premium, if any, and, except as set forth in paragraph 1, interest, and
liquidated damages, if any, in money of the United States of

- ----------
    (3) Insert if the Security is to be issued in global form.

    (4) Insert if the Security is to be issued in definitive form.



                                                                               5

America that at the time of payment is legal tender for payment of public and
private debts. Payments in respect of the Consenting Securities represented by a
Global Security (including principal, premium, if any, interest and liquidated
damages, if any) shall be made by wire transfer of immediately available funds
to the accounts specified by The Depository Trust Company or any successor
depository; PROVIDED that any such payment of interest or liquidated damages in
the form of Additional Securities shall be made in accordance with paragraph 1.
The Company will make all payments in respect of a certificated Consenting
Security (including principal and premium, if any, and interest and liquidated
damages, if any), at the office of the Paying Agent; PROVIDED, HOWEVER, that
payments on the Consenting Securities may also be made, in the case of a Holder
of at least $1,000,000 aggregate principal amount of Consenting Securities, by
wire transfer to a U.S. dollar account maintained by the payee with a bank in
the United States if such Holder elects payment by wire transfer by giving
written notice to the Trustee or the Paying Agent to such effect designating
such account no later than 30 days immediately preceding the relevant due date
for payment (or such other date as the Trustee may accept in its discretion);
PROVIDED further that any such payment of interest or liquidated damages in the
form of Additional Securities shall be made in accordance with paragraph 1.

3.  PAYING AGENT AND REGISTRAR

          Initially, WILMINGTON TRUST COMPANY , a Delaware banking corporation
(the "Trustee"), will act as Paying Agent and Registrar. The Company may appoint
and change any Paying Agent or Registrar without notice. The Company or any of
its domestically incorporated Wholly Owned Subsidiaries may act as Paying Agent
or Registrar.

4.  INDENTURE

          The Company issued the Securities under an Indenture dated as of
February 17, 2004, as amended and restated as of May 6, 2005 (as amended and
restated, the "Indenture"), among the Company, the Note Guarantors and the
Trustee. The terms of the Securities include those stated in the Indenture and
those made part of the Indenture by reference to the Trust Indenture Act of 1939
(15 U.S.C. Sections 77aaa-77bbbb) as in effect on the date of the Indenture (the
"TIA"). Terms defined in the Indenture and not defined herein have the meanings
ascribed thereto in the Indenture. The Securities are subject to all terms and
provisions of the Indenture, and Holders (as defined in the Indenture) are
referred to the Indenture and the TIA for a statement of such terms and
provisions.

          The Securities are senior secured obligations of the Company. The
Company shall be entitled, subject to its compliance with Section 4.03 of the
Indenture, to issue Additional Securities pursuant to Section 2.01 of the
Indenture. This Security is one of the Exchange Notes referred to in the
Indenture. The Securities include the Consenting Securities, the Non-Consenting
Securities, the Additional Securities and any Exchange Notes and Private
Exchange Notes issued in exchange for the Initial Securities pursuant to the
Indenture. The Consenting Securities, the Non-Consenting Securities, the



                                                                               6

Additional Securities, the Exchange Notes and the Private Exchange Notes are
treated as a single class of securities under the Indenture, except as
specifically stated otherwise therein. The Indenture imposes certain limitations
on the ability of the Company and its Restricted Subsidiaries to, among other
things, make certain Investments and other Restricted Payments, pay dividends
and other distributions, incur Indebtedness, enter into consensual restrictions
upon the payment of certain dividends and distributions by such Restricted
Subsidiaries, enter into or permit certain transactions with Affiliates, make
asset sales and incur Liens. The Indenture also imposes limitations on the
ability of the Company and each Note Guarantor to consolidate or merge with or
into any other Person or the Company to convey, transfer or lease all or
substantially all of its property.

          To guarantee the due and punctual payment of the principal and
interest on the Securities and all other amounts payable by the Company under
the Indenture and the Securities when and as the same shall be due and payable,
whether at maturity, by acceleration or otherwise, according to the terms of the
Securities and the Indenture, the Note Guarantors have, jointly and severally,
unconditionally guaranteed the Guaranteed Obligations on a senior secured basis
pursuant to the terms of the Indenture.

          The Securities are secured (i) on a first-priority basis with respect
to the First-Priority Collateral and (ii) on a second-priority basis with
respect to the Second-Priority Collateral, in each case, by the Liens created by
the Security Documents pursuant to, and subject to, the terms of the Indenture
and the Intercreditor Agreement.

5.  OPTIONAL REDEMPTION

          Except as set forth in the following paragraph, the Consenting
Securities shall not be redeemable at the option of the Company prior to June
15, 2007. On or after June 15, 2007, the Consenting Securities shall be
redeemable at the option of the Company, in whole or in part, on not less than
30 nor more than 60 days prior notice, at the following redemption prices
(expressed as percentages of the sum of the principal amount plus accrued and
unpaid interest and liquidated damages, if any, to the redemption date (subject
to the right of Holders of record on the relevant record date to receive
interest and liquidated damages, if any, due on the relevant Interest Payment
Date)), if redeemed during the six-month period commencing on the date set forth
below (or, in the case of June 15, 2009, on such date):



                                                    REDEMPTION
          YEAR                                        PRICE
          ----------------------------------------------------
                                                 
          June 15, 2007                             111.625%
          December 15, 2007                         108.719%
          June 15, 2008                             105.813%
          December 15, 2008                         102.906%
          June 15, 2009                             100.000%




                                                                               7

          In addition, prior to June 15, 2007, the Company may redeem up to a
maximum of 35% of the principal amount of the Consenting Securities (calculated
after giving effect to any issuance of Additional Securities) with the Net Cash
Proceeds of one or more Equity Offerings by the Company at a redemption price
equal to 111.625% of the sum of the principal amount plus accrued and unpaid
interest and liquidated damages, if any, thereon at the date of redemption;
PROVIDED, HOWEVER, that after giving effect to any such redemption, at least 65%
of the principal amount of the Consenting Securities (calculated after giving
effect to any issuance of Additional Securities) remains outstanding, and any
such redemption shall be made within 120 days of such Equity Offering upon not
less than 30 nor more than 60 days notice mailed to each Holder of Consenting
Securities being redeemed and otherwise in accordance with the procedures set
forth in the Indenture.

6.  SINKING FUND

          The Consenting Securities are not subject to any sinking fund.

7.  NOTICE OF REDEMPTION

          Notice of redemption will be mailed by first-class mail at least 30
days but not more than 60 days before the redemption date to each Holder of
Consenting Securities to be redeemed at his or her registered address.
Consenting Securities in denominations larger than $1,000 principal amount may
be redeemed in part but only in whole multiples of $1,000 principal amount. If
money sufficient to pay the redemption price of and accrued and unpaid interest
and liquidated damages, if any, on all Consenting Securities (or portions
thereof) to be redeemed on the redemption date is deposited with the Paying
Agent on or before the redemption date and certain other conditions are
satisfied, on and after such date interest ceases to accrue on such Consenting
Securities (or such portions thereof) called for redemption.

8.  REPURCHASE OF SECURITIES AT THE OPTION OF HOLDERS UPON CHANGE OF CONTROL

          Upon a Change of Control, any Holder of Consenting Securities will
have the right, subject to certain conditions specified in the Indenture, to
cause the Company to repurchase all or any part of the Consenting Securities of
such Holder at a purchase price equal to 101% of the sum of the principal amount
of the Consenting Securities to be repurchased plus accrued and unpaid interest
and liquidated damages, if any, to the date of repurchase (subject to the right
of Holders of record at the relevant record date to receive interest due and
liquid damages, if any, on the relevant Interest Payment Date that is prior to
the date of purchase) as provided in, and subject to the terms of, the
Indenture.

          In accordance with Section 4.06 of the Indenture, the Company will be
required to offer to purchase Consenting Securities upon the occurrence of
certain events.

9.  DENOMINATIONS; TRANSFER; EXCHANGE

          The Consenting Securities are in registered form without coupons in
denominations of $1,000 principal amount and whole multiples of $1,000 principal



                                                                               8

amount; provided that (x) the aggregate principal amount of the Consenting
Securities issued on the Closing Date shall equal the aggregate Accreted Value
as of the Closing Date of the Existing Securities with respect to which consents
to the Amendments were given and accepted by the Company, which is $250,607,280
and (y) the aggregate principal amount of the Exchange Notes and Private
Exchange Notes issued in exchange for any Consenting Securities shall equal the
aggregate principal amount of such Consenting Securities; provided further that
Additional Securities issued as payment of interest on the Consenting Securities
shall be issued in denominations of $0.01 and integral multiples of $0.01. A
Holder may transfer or exchange Consenting Securities in accordance with the
Indenture. Upon any transfer or exchange, the Registrar and the Trustee may
require a Holder, among other things, to furnish appropriate endorsements or
transfer documents and to pay any taxes required by law or permitted by the
Indenture. The Registrar need not register the transfer of or exchange any
Consenting Securities selected for redemption (except, in the case of a
Consenting Security to be redeemed in part, the portion of the Security not to
be redeemed) or to transfer or exchange any Consenting Securities for a period
of 15 days prior to a selection of Consenting Securities to be redeemed.

10. PERSONS DEEMED OWNERS

          Except as provided in paragraph 2 hereof, the registered Holder of
this Consenting Security may be treated as the owner of it for all purposes.

11. UNCLAIMED MONEY

          If money for the payment of principal or interest remains unclaimed
for two years, the Trustee and the Paying Agent shall pay the money back to the
Company at its written request unless an abandoned property law designates
another Person. After any such payment, Holders entitled to the money must look
only to the Company for payment and not to the Trustee for payment as general
creditors and the Trustee and the Paying Agent shall have no further liability
with respect to such monies.

12. DISCHARGE AND DEFEASANCE

          Subject to certain conditions, the Company at any time may terminate
some of or all its obligations under the Securities and the Indenture if the
Company deposits with the Trustee money or U.S. Government Obligations for the
payment of principal of, and interest and liquidated damages, if any, on, the
Securities to redemption or maturity, as the case may be.

13. AMENDMENT, WAIVER

          Subject to certain exceptions set forth in the Indenture, (i) the
Indenture, the Securities, the Security Documents or the Intercreditor Agreement
may be amended without prior notice to any Holder but with the written consent
of the Holders of at least a majority in aggregate principal amount of the
outstanding Securities; PROVIDED that without the consent of the Holders of at
least 66 2/3% in aggregate principal amount of the



                                                                               9

outstanding Securities, no amendment or waiver may (x) release any Collateral
from the Lien of the Indenture and the Security Documents (except as permitted
by the terms of the Security Documents or the Intercreditor Agreement), (y)
change the provisions applicable to the application of the proceeds from the
sale of Collateral or (z) change or alter the priority of the security interests
in the Collateral and (ii) any default or compliance with any provisions of the
Indenture may be waived with the written consent of the Holders of at least a
majority in principal amount of the outstanding Securities. Subject to certain
exceptions set forth in the Indenture, without the consent of any Holder, the
Company, the Note Guarantors and the Trustee may amend the Indenture or the
Securities (i) to cure any ambiguity, omission, defect or inconsistency; (ii) to
comply with Article 5 of the Indenture; (iii) to provide for uncertificated
Securities in addition to or in place of certificated Securities; (iv) to add
Note Guarantees with respect to the Securities or to secure further the
Securities; (v) to add additional covenants or to surrender rights and powers
conferred on the Company; (vi) to comply with the requirements of the SEC in
order to effect or maintain the qualification of the Indenture under the TIA;
(vii) to make any change that does not materially and adversely affect the
rights of any Holder under the provisions of the Indenture; (viii) to provide
for the issuance of the Additional Securities, the Exchange Notes or Private
Exchange Notes; and (ix) if necessary, in connection with any addition or
release of Collateral permitted under the terms of the Indenture or the Security
Documents.

14. DEFAULTS AND REMEDIES

          If an Event of Default occurs (other than an Event of Default relating
to certain events of bankruptcy, insolvency or reorganization of the Company)
and is continuing, the Trustee or the Holders of at least 25% in principal
amount of the outstanding Securities may declare the principal of and accrued
but unpaid interest on all the Securities to be due and payable. If an Event of
Default relating to certain events of bankruptcy, insolvency or reorganization
of the Company occurs, the principal of and interest on all the Securities shall
become immediately due and payable without any declaration or other act on the
part of the Trustee or any Holders. Under certain circumstances, the Holders of
a majority in principal amount of the outstanding Securities may rescind any
such acceleration with respect to the Securities and its consequences.

          If an Event of Default occurs and is continuing, the Trustee shall be
under no obligation to exercise any of the rights or powers under the Indenture
at the request or direction of any of the Holders unless such Holders have
offered to the Trustee reasonable indemnity or security against any loss,
liability or expense and certain other conditions are complied with. Except to
enforce the right to receive payment of principal, premium (if any) or interest
when due, no Holder may pursue any remedy with respect to the Indenture or the
Securities unless (i) such Holder has previously given the Trustee notice that
an Event of Default is continuing, (ii) Holders of at least 25% in principal
amount of the outstanding Securities have requested the Trustee in writing to
pursue the remedy, (iii) such Holders have offered the Trustee reasonable
security or indemnity against any loss, liability or expense, (iv) the Trustee
has not complied with such request within 60 days after the receipt of the
request and the offer of security or indemnity and (v) the Holders of a majority
in principal amount of the outstanding



                                                                              10

Securities have not given the Trustee a direction inconsistent with such request
within such 60-day period. Subject to certain restrictions, the Holders of a
majority in principal amount of the outstanding Securities are given the right
to direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee or of exercising any trust or power conferred on the
Trustee. The Trustee, however, may refuse to follow any direction that conflicts
with law or the Indenture or that the Trustee determines is unduly prejudicial
to the rights of any other Holder or that would involve the Trustee in personal
liability. Prior to taking any action under the Indenture, the Trustee shall be
entitled to indemnification or security reasonably satisfactory to it against
all losses and expenses caused by taking or not taking such action.

15. TRUSTEE DEALINGS WITH THE COMPANY

          Subject to certain limitations imposed by the TIA, the Trustee under
the Indenture, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with and collect obligations owed
to it by the Company, a Note Guarantor or its Affiliates and may otherwise deal
with the Company, a Note Guarantor or its Affiliates with the same rights it
would have if it were not Trustee.

16. NO RECOURSE AGAINST OTHERS

          A director, officer, employee or stockholder, as such, of the Company
or any Note Guarantor shall not have any liability for any obligations of the
Company or any Note Guarantor under the Securities or the Indenture or for any
claim based on, in respect of or by reason of such obligations or their
creation. By accepting a Security, each Holder waives and releases all such
liability. The waiver and release are part of the consideration for the issue of
the Securities.

17. AUTHENTICATION

          This Consenting Security shall not be valid until an authorized
signatory of the Trustee (or an authenticating agent) manually signs the
certificate of authentication on the other side of this Security.

18. ABBREVIATIONS

          Customary abbreviations may be used in the name of a Holder or an
assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with rights of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).

19. GOVERNING LAW

          THIS CONSENTING SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO
APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE



                                                                              11

APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

20. CUSIP AND ISIN NUMBERS

          The Company has caused CUSIP and ISIN numbers to be printed on the
Consenting Securities and has directed the Trustee to use CUSIP and ISIN numbers
in notices of redemption as a convenience to Holders. No representation is made
as to the accuracy of such numbers either as printed on the Consenting
Securities or as contained in any notice of redemption and reliance may be
placed only on the other identification numbers placed thereon.

21. DESIGNATED SENIOR INDEBTEDNESS

          For purposes of the Senior Subordinated Notes Indentures, the
Securities and the Note Guarantees shall constitute Designated Senior
Indebtedness (as such term is defined in the Senior Subordinated Notes
Indentures) of the Company and the Note Guarantors, as the case may be.

          THE COMPANY WILL FURNISH TO ANY HOLDER OF CONSENTING SECURITIES UPON
WRITTEN REQUEST AND WITHOUT CHARGE TO THE HOLDER A COPY OF THE INDENTURE WHICH
HAS IN IT THE TEXT OF THIS CONSENTING SECURITY.



                                                                              12

                                 ASSIGNMENT FORM


To assign this Security, fill in the form below:


I or we assign and transfer this Security to

________________________________________________________________________________
              (Print or type assignee's name, address and zip code)

________________________________________________________________________________
                  (Insert assignee's soc. sec. or tax I.D. No.)


and irrevocably appoint            agent to transfer this Security on the books
of the Company. The agent may substitute another to act for him.

Date:                    Your Signature:
      ------------------                 ---------------------

(Sign exactly as your name appears on the other side of this Security.)


Signature Guarantee:

Date:
      ----------------------           ---------------------------
Signature must be guaranteed           Signature of Signature
by a participant in a                  Guarantee
recognized signature guaranty
medallion program or other
signature guarantor acceptable
to the Trustee



                                                                              13

                       OPTION OF HOLDER TO ELECT PURCHASE

          IF YOU WANT TO ELECT TO HAVE THIS SECURITY PURCHASED BY THE COMPANY
PURSUANT TO SECTION 4.06 (ASSET DISPOSITION) OR 4.08 (CHANGE OF CONTROL) OF THE
INDENTURE, CHECK THE BOX:

                   ASSET DISPOSITION / / CHANGE OF CONTROL / /

          IF YOU WANT TO ELECT TO HAVE ONLY PART OF THIS SECURITY PURCHASED BY
THE COMPANY PURSUANT TO SECTION 4.06 OR 4.08 OF THE INDENTURE, STATE THE AMOUNT
($1,000 PRINCIPAL AMOUNT OR AN INTEGRAL MULTIPLE THEREOF):

$


DATE:                       YOUR SIGNATURE:
      --------------------                  --------------------
(SIGN EXACTLY AS YOUR NAME APPEARS ON THE OTHER SIDE OF THE SECURITY)


SIGNATURE GUARANTEE:
                    ----------------------------------------
                    SIGNATURE MUST BE GUARANTEED BY A PARTICIPANT IN A
                    RECOGNIZED SIGNATURE GUARANTY MEDALLION PROGRAM OR OTHER
                    SIGNATURE GUARANTOR ACCEPTABLE TO THE TRUSTEE



                                                                              14

                      [TO BE ATTACHED TO GLOBAL SECURITIES]

              SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY

          The initial principal amount of this Global Security is $[    ]. The
following increases or decreases in this Global Security have been made:



           Amount of decrease in      Amount of increase           Principal amount of this    Signature of authorized
Date of    principal amount of this   inprincipal amount of this   Global Security following   signatory of Trustee or
Exchange   Global Security            Global Security              such decrease or increase   Securities Custodian
                                                                                   





                                                                     EXHIBIT B-2

            [FORM OF FACE OF EXCHANGE NOTE - NON-CONSENTING SECURITY]

                           [GLOBAL SECURITIES LEGEND]

          UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW
YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

          TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO DTC, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR
SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL
BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.

          FOR UNITED STATES FEDERAL INCOME TAX PURPOSES, THIS INSTRUMENT IS
CONSIDERED TO BE ISSUED WITH ORIGINAL ISSUE DISCOUNT. FOR INFORMATION CONCERNING
THE ISSUE PRICE, AMOUNT OF ORIGINAL ISSUE DISCOUNT, ISSUE DATE AND YIELD TO
MATURITY OF THIS INSTRUMENT, CONTACT JOE KWEDERIS, SENIOR VICE-PRESIDENT FINANCE
OF THE ISSUER AT 1475 WOODFIELD ROAD, SUITE 700, SCHAUMBURG, ILLINOIS 60173,
TEL: (847) 407-5117.



                                                                               2

No.                                                                  $__________


                  11 1/8% Senior Secured Discount Note due 2009

                                                            CUSIP No. __________
                                                             ISIN No. __________


          PLIANT CORPORATION, a Utah corporation, promises to pay to Cede & Co.,
or registered assigns, the principal amount at maturity [listed on the Schedule
of Increases or Decreases in Global Security attached hereto](9) [of $______]
(10) on June 15, 2009.

          Interest Payment Dates:  June 15 and December 15.

          Record Dates:   June 1 and December 1.


- ----------
      (9) Insert if Security is to be issued in global form.

      (10) Insert if Security is to be issued in definitive form.



                                                                               3

          Additional provisions of this Security are set forth on the other side
of this Security.

          IN WITNESS WHEREOF, the parties have caused this instrument to be duly
executed.


                                       PLIANT CORPORATION,

                                         by
                                           -------------------------------------
                                           Name:
                                           Title:

                                         by
                                           -------------------------------------
                                           Name:
                                           Title:


Dated:

TRUSTEE'S CERTIFICATE OF
     AUTHENTICATION

WILMINGTON TRUST COMPANY,

as Trustee, certifies that this is one of
the Securities referred to in the Indenture.

     by
         -----------------------------
             Authorized Signatory


- ----------
*/ If the Security is to be issued in global form, add the Global Securities
Legend and the attachment from Exhibit A captioned "TO BE ATTACHED TO GLOBAL
SECURITIES - SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY".



                                                                               4

[FORM OF REVERSE SIDE OF EXCHANGE NOTE - NON-CONSENTING SECURITY]

                  11 1/8% Senior Secured Discount Note due 2009

1.  ACCRETED VALUE; INTEREST

          PLIANT CORPORATION, a Utah corporation (such corporation, and its
successors and assigns under the Indenture hereinafter referred to, being herein
called the "Company"), promises to pay interest on the principal amount at
maturity of this Non-Consenting Security at the rate per annum shown above.

          Unless the Company elects to pay cash interest as described below, no
cash interest will accrue on the Non-Consenting Securities prior to December 15,
2006. The Accreted Value of each Non-Consenting Security will increase from the
date of issuance until December 15, 2006, at a rate of 11?% per annum,
compounded semiannually on each June 15 and December 15 commencing June 15,
2004, reflecting the accrual of non-cash interest, such that the Accreted Value
will equal the stated principal amount at maturity on December 15, 2006. Cash
interest on the Non-Consenting Securities will accrue at the rate of 11?% per
annum from December 15, 2006, or from the most recent date to which interest has
been paid or provided for, and will be payable in cash semiannually on June 15
and December 15 of each year (each an "Interest Payment Date"), commencing on
June 15, 2007, to holders of record on the immediately preceding June 1 and
December 1, respectively. Notwithstanding the foregoing, on any Interest Payment
Date prior to December 15, 2005, the Company may elect to commence to pay cash
interest (from and after such Interest Payment Date), in which case (i) the
Company will be obligated to pay cash interest on each subsequent Interest
Payment Date, (ii) the Non-Consenting Securities will cease to accrete after
such Interest Payment Date and (iii) the outstanding principal amount at Stated
Maturity of each Non-Consenting Security will be equal to the Accreted Value of
such Non-Consenting Security as of such Interest Payment Date. Interest and
Accreted Value will be computed on the basis of a 360-day year comprised of
twelve 30-day months. The Company shall pay interest on overdue principal at the
rate borne by the Non-Consenting Securities, and it shall pay interest on
overdue installments of interest at the same rate to the extent lawful. Interest
will be payable as described in the foregoing paragraph, except as described
under paragraph 14 of this Non-Consenting Security.

          "Accreted Value" as of any date (the "Specified Date") means, with
respect to each $1,000 principal amount at maturity of the Non-Consenting
Securities (subject to the latest sentence of this definition):

          (i) if the Specified Date is one of the following dates (each a
     "Semi-Annual Accretion Date"), the amount set forth opposite each date
     below:



                                                                               5



SEMI-ANNUAL ACCRETION DATE                                      ACCRETED VALUE
- --------------------------                                      --------------
                                                               
Issue Date.................................................       $   736.27
June 15, 2004..............................................       $   762.87
December 15, 2004..........................................       $   805.31
June 15, 2005..............................................       $   897.39
December 15, 2005..........................................       $   947.31
June 15, 2006..............................................       $ 1,000.00


          (ii) if the Specified Date occurs between two Semi-Annual Accretion
     Dates, the sum of (a) the Accreted Value for the Semi-Annual Accretion Date
     immediately preceding the Specified Date and (b) an amount equal to the
     product of (x) the Accreted Value for the immediately following Semi-Annual
     Accretion Date less the Accreted Value of the immediately preceding
     Semi-Annual Accretion Date and (y) the fraction, the numerator of which is
     the number of days actually elapsed from the immediately preceding
     Semi-Annual Accretion Date and the denominator of which is 180; or

          (iii) if the Specified Date is after December 15, 2006, $1,000.

          For the purposes hereof, if the Specified Date is prior to December
15, 2006 but on or after the date on which the Company elects to commence to pay
cash interest (the "Cash Election Date"), all references in this document to
Accreted Value in respect of any Non-Consenting Security shall be to the
aggregate principal amount of such Non-Consenting Security, which shall be equal
to the Accreted Value of the such Non-Consenting Security as of the Cash
Election Date determined in accordance with clauses (i) and (ii) above.

2.  METHOD OF PAYMENT

          The Company shall pay interest on the Non-Consenting Securities
(except defaulted interest) to the Persons who are registered Holders at the
close of business on the June 1 and December 1 next preceding the Interest
Payment Date even if the Non-Consenting Securities are canceled after the record
date and on or before the Interest Payment Date. Holders must surrender
Non-Consenting Securities to a Paying Agent to collect principal payments. The
Company shall pay principal, premium, if any, and interest in money of the
United States of America that at the time of payment is legal tender for payment
of public and private debts. Payments in respect of the Non-Consenting
Securities represented by a Global Security (including principal, premium and
interest) shall be made by wire transfer of immediately available funds to the
accounts specified by The Depository Trust Company or any successor depositary.
The Company will make all payments in respect of a certificated Non-Consenting
Security (including principal, premium, if any and interest), at the office of
the Paying Agent, except that, at the option of the Company, payment of interest
may be made by mailing a check to the registered address of each Holder thereof;
PROVIDED, HOWEVER, that payments on the Non-Consenting Securities may also be
made, in the case of a Holder of at least $1,000,000 aggregate principal amount
at maturity of Non-Consenting Securities,



                                                                               6

by wire transfer to a U.S. dollar account maintained by the payee with a bank in
the United States if such Holder elects payment by wire transfer by giving
written notice to the Trustee or the Paying Agent to such effect designating
such account no later than 30 days immediately preceding the relevant due date
for payment (or such other date as the Trustee may accept in its discretion).

3.  PAYING AGENT AND REGISTRAR

          Initially, WILMINGTON TRUST COMPANY , a Delaware banking corporation
(the "Trustee"), will act as Paying Agent and Registrar. The Company may appoint
and change any Paying Agent or Registrar without notice. The Company or any of
its domestically incorporated Wholly Owned Subsidiaries may act as Paying Agent
or Registrar.

4.  INDENTURE

          The Company issued the Securities under an Indenture dated as of
February 17, 2004, as amended and restated on May 6, 2005 (as amended and
restated, the "Indenture"), among the Company, the Note Guarantors and the
Trustee. The terms of the Securities include those stated in the Indenture and
those made part of the Indenture by reference to the Trust Indenture Act of 1939
(15 U.S.C. Sections 77aaa-77bbbb) as in effect on the date of the Indenture (the
"TIA"). Terms defined in the Indenture and not defined herein have the meanings
ascribed thereto in the Indenture. The Securities are subject to all terms and
provisions of the Indenture, and Holders (as defined in the Indenture) are
referred to the Indenture and the TIA for a statement of such terms and
provisions.

          The Securities are senior secured obligations of the Company. The
Company shall be entitled, subject to its compliance with Section 4.03 of the
Indenture, to issue Additional Securities pursuant to Section 2.01 of the
Indenture. This Security is one of the Exchange Notes referred to in the
Indenture. The Securities include the Non-Consenting Securities, the Consenting
Securities, the Additional Securities and any Exchange Notes and Private
Exchange Notes issued in exchange for the Initial Securities pursuant to the
Indenture. The Non-Consenting Securities, the Consenting Securities, the
Additional Securities, the Exchange Notes and the Private Exchange Notes are
treated as a single class of securities under the Indenture, except as
specifically stated otherwise therein. The Indenture imposes certain limitations
on the ability of the Company and its Restricted Subsidiaries to, among other
things, make certain Investments and other Restricted Payments, pay dividends
and other distributions, incur Indebtedness, enter into consensual restrictions
upon the payment of certain dividends and distributions by such Restricted
Subsidiaries, enter into or permit certain transactions with Affiliates, make
asset sales and incur Liens. The Indenture also imposes limitations on the
ability of the Company and each Note Guarantor to consolidate or merge with or
into any other Person or the Company to convey, transfer or lease all or
substantially all of its property.

          To guarantee the due and punctual payment of the principal and
interest, if any, on the Securities and all other amounts payable by the Company
under the Indenture



                                                                               7

and the Securities when and as the same shall be due and payable, whether at
maturity, by acceleration or otherwise, according to the terms of the Securities
and the Indenture, the Note Guarantors have, jointly and severally,
unconditionally guaranteed the Guaranteed Obligations on a senior secured basis
pursuant to the terms of the Indenture.

          The Securities are secured (i) on a first-priority basis with respect
to the First-Priority Collateral and (ii) on a second-priority basis with
respect to the Second-Priority Collateral, in each case, by the Liens created by
the Security Documents pursuant to, and subject to, the terms of the Indenture
and the Intercreditor Agreement.

5.  OPTIONAL REDEMPTION

          Except as set forth in the following paragraph, the Non-Consenting
Securities shall not be redeemable at the option of the Company prior to June
15, 2007. On or after June 15, 2007, the Non-Consenting Securities shall be
redeemable at the option of the Company, in whole or in part, on not less than
30 nor more than 60 days prior notice, at the following redemption prices
(expressed as percentages of Accreted Value), plus accrued and unpaid interest
and liquidated damages, if any, to the redemption date (subject to the right of
Holders of record on the relevant record date to receive interest due on the
relevant Interest Payment Date), if redeemed during the 12-month period
commencing on June 15 of the years set forth below (or, in the case of June 15,
2009, on such date):



                                                      REDEMPTION
         YEAR                                           PRICE
         -------------------------------------------------------
                                                    
         2007                                          105.563%
         2008                                          102.781%
         2009                                          100.000%


          In addition, prior to June 15, 2007, the Company may redeem up to a
maximum of 35% of the Accreted Value of the Non-Consenting Securities
(calculated after giving effect to any issuance of Additional Securities) with
the Net Cash Proceeds of one or more Equity Offerings by the Company at a
redemption price equal to 111.125% of the Accreted Value at the date of
redemption, plus accrued and unpaid interest and liquidated damages thereon, if
any, to the date of redemption; PROVIDED, HOWEVER, that after giving effect to
any such redemption, at least 65% of the Accreted Value of the Non-Consenting
Securities (calculated after giving effect to any issuance of Additional
Securities) remains outstanding, and any such redemption shall be made within
120 days of such Equity Offering upon not less than 30 nor more than 60 days
notice mailed to each Holder of Non-Consenting Securities being redeemed and
otherwise in accordance with the procedures set forth in the Indenture.

6.  SINKING FUND

          The Non-Consenting Securities are not subject to any sinking fund.



                                                                               8

7.  NOTICE OF REDEMPTION

          Notice of redemption will be mailed by first-class mail at least 30
days but not more than 60 days before the redemption date to each Holder of
Non-Consenting Securities to be redeemed at his or her registered address.
Non-Consenting Securities in denominations larger than $1,000 principal amount
at maturity may be redeemed in part but only in whole multiples of $1,000
principal amount at maturity. If money sufficient to pay the redemption price of
and accrued and unpaid interest and liquidated damages, if any, on all
Non-Consenting Securities (or portions thereof) to be redeemed on the redemption
date is deposited with the Paying Agent on or before the redemption date and
certain other conditions are satisfied, on and after such date interest ceases
to accrue on such Non-Consenting Securities (or such portions thereof) called
for redemption.

[Intentionally Deleted]

9.  DENOMINATIONS; TRANSFER; EXCHANGE

          The Non-Consenting Securities are in registered form without coupons
in denominations of $1,000 principal amount at maturity and whole multiples of
$1,000 principal amount at maturity. A Holder may transfer or exchange
Non-Consenting Securities in accordance with the Indenture. Upon any transfer or
exchange, the Registrar and the Trustee may require a Holder, among other
things, to furnish appropriate endorsements or transfer documents and to pay any
taxes required by law or permitted by the Indenture. The Registrar need not
register the transfer of or exchange any Non-Consenting Securities selected for
redemption (except, in the case of a Security to be redeemed in part, the
portion of the Security not to be redeemed) or to transfer or exchange any
Non-Consenting Securities for a period of 15 days prior to a selection of
Non-Consenting Securities to be redeemed.

10. PERSONS DEEMED OWNERS

          Except as provided in paragraph 2 hereof, the registered Holder of
this Non-Consenting Security may be treated as the owner of it for all purposes.

11. UNCLAIMED MONEY

          If money for the payment of principal or interest remains unclaimed
for two years, the Trustee and the Paying Agent shall pay the money back to the
Company at its written request unless an abandoned property law designates
another Person. After any such payment, Holders entitled to the money must look
only to the Company for payment and not to the Trustee for payment as general
creditors and the Trustee and the Paying Agent shall have no further liability
with respect to such monies.

12. DISCHARGE AND DEFEASANCE

          Subject to certain conditions, the Company at any time may terminate
some of or all its obligations under the Securities and the Indenture if the
Company



                                                                               9

deposits with the Trustee money or U.S. Government Obligations for the payment
of principal and interest on the Securities to redemption or maturity, as the
case may be.

13. AMENDMENT, WAIVER

          Subject to certain exceptions set forth in the Indenture, (i) the
Indenture, the Securities, the Security Documents or the Intercreditor Agreement
may be amended without prior notice to any Holder but with the written consent
of the Holders of at least a majority in aggregate principal amount at maturity
of the outstanding Securities; PROVIDED that without the consent of the Holders
of at least 66 2/3% in aggregate principal amount at maturity of the outstanding
Securities, no amendment or waiver may (x) release any Collateral from the Lien
of the Indenture and the Security Documents (except as permitted by the terms of
the Security Documents or the Intercreditor Agreement), (y) change the
provisions applicable to the application of the proceeds from the sale of
Collateral or (z) change or alter the priority of the security interests in the
Collateral and (ii) any default or compliance with any provisions of the
Indenture may be waived with the written consent of the Holders of at least a
majority in principal amount at maturity of the outstanding Securities. Subject
to certain exceptions set forth in the Indenture, without the consent of any
Holder, the Company, the Note Guarantors and the Trustee may amend the Indenture
or the Securities (i) to cure any ambiguity, omission, defect or inconsistency;
(ii) to comply with Article 5 of the Indenture; (iii) to provide for
uncertificated Securities in addition to or in place of certificated Securities;
(iv) to add Note Guarantees with respect to the Securities or to secure further
the Securities; (v) to add additional covenants or to surrender rights and
powers conferred on the Company; (vi) to comply with the requirements of the SEC
in order to effect or maintain the qualification of the Indenture under the TIA;
(vii) to make any change that does not materially and adversely affect the
rights of any Holder under the provisions of the Indenture; (viii) to provide
for the issuance of the Additional Securities, the Exchange Notes or Private
Exchange Notes; and (ix) if necessary, in connection with any addition or
release of Collateral permitted under the terms of the Indenture or the Security
Documents.

14. DEFAULTS AND REMEDIES

          If an Event of Default occurs (other than an Event of Default relating
to certain events of bankruptcy, insolvency or reorganization of the Company)
and is continuing, the Trustee or the Holders of at least 25% in principal
amount at maturity of the outstanding Securities may declare the principal of
and accrued but unpaid interest on all the Securities to be due and payable. If
an Event of Default relating to certain events of bankruptcy, insolvency or
reorganization of the Company occurs, the principal of and interest on all the
Securities shall become immediately due and payable without any declaration or
other act on the part of the Trustee or any Holders and if such Event of Default
occurs prior to the earlier of (i) the Cash Election Date and (ii) December 15,
2006, the Company will thereafter be obligated to pay cash interest on each
subsequent Interest Payment Date and the Securities will cease to accrete. Under
certain circumstances, the Holders of a majority in principal amount at maturity
of the



                                                                              10

outstanding Securities may rescind any such acceleration with respect to the
Securities and its consequences.

          If an Event of Default occurs and is continuing, the Trustee shall be
under no obligation to exercise any of the rights or powers under the Indenture
at the request or direction of any of the Holders unless such Holders have
offered to the Trustee reasonable indemnity or security against any loss,
liability or expense and certain other conditions are complied with. Except to
enforce the right to receive payment of principal, premium (if any) or interest
when due, no Holder may pursue any remedy with respect to the Indenture or the
Securities unless (i) such Holder has previously given the Trustee notice that
an Event of Default is continuing, (ii) Holders of at least 25% in principal
amount at maturity of the outstanding Securities have requested the Trustee in
writing to pursue the remedy, (iii) such Holders have offered the Trustee
reasonable security or indemnity against any loss, liability or expense, (iv)
the Trustee has not complied with such request within 60 days after the receipt
of the request and the offer of security or indemnity and (v) the Holders of a
majority in principal amount at maturity of the outstanding Securities have not
given the Trustee a direction inconsistent with such request within such 60-day
period. Subject to certain restrictions, the Holders of a majority in principal
amount at maturity of the outstanding Securities are given the right to direct
the time, method and place of conducting any proceeding for any remedy available
to the Trustee or of exercising any trust or power conferred on the Trustee. The
Trustee, however, may refuse to follow any direction that conflicts with law or
the Indenture or that the Trustee determines is unduly prejudicial to the rights
of any other Holder or that would involve the Trustee in personal liability.
Prior to taking any action under the Indenture, the Trustee shall be entitled to
indemnification or security reasonably satisfactory to it against all losses and
expenses caused by taking or not taking such action.

15. TRUSTEE DEALINGS WITH THE COMPANY

          Subject to certain limitations imposed by the TIA, the Trustee under
the Indenture, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with and collect obligations owed
to it by the Company, a Note Guarantor or its Affiliates and may otherwise deal
with the Company, a Note Guarantor or its Affiliates with the same rights it
would have if it were not Trustee.

16. NO RECOURSE AGAINST OTHERS

          A director, officer, employee or stockholder, as such, of the Company
or any Note Guarantor shall not have any liability for any obligations of the
Company or any Note Guarantor under the Securities or the Indenture or for any
claim based on, in respect of or by reason of such obligations or their
creation. By accepting a Security, each Holder waives and releases all such
liability. The waiver and release are part of the consideration for the issue of
the Securities.



                                                                              11

17. AUTHENTICATION

          This Non-Consenting Security shall not be valid until an authorized
signatory of the Trustee (or an authenticating agent) manually signs the
certificate of authentication on the other side of this Security.

18. ABBREVIATIONS

          Customary abbreviations may be used in the name of a Holder or an
assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with rights of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).

19. GOVERNING LAW

          THIS NON-CONSENTING SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO
APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF
THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

20. CUSIP AND ISIN NUMBERS

          The Company has caused CUSIP and ISIN numbers to be printed on the
Non-Consenting Securities and has directed the Trustee to use CUSIP and ISIN
numbers in notices of redemption as a convenience to Holders. No representation
is made as to the accuracy of such numbers either as printed on the
Non-Consenting Securities or as contained in any notice of redemption and
reliance may be placed only on the other identification numbers placed thereon.

21. DESIGNATED SENIOR INDEBTEDNESS

          For purposes of the Senior Subordinated Notes Indentures, the
Securities and the Note Guarantees shall constitute Designated Senior
Indebtedness (as such term is defined in the Senior Subordinated Notes
Indentures) of the Company and the Note Guarantors, as the case may be.

          THE COMPANY WILL FURNISH TO ANY HOLDER OF NON-CONSENTING SECURITIES
UPON WRITTEN REQUEST AND WITHOUT CHARGE TO THE HOLDER A COPY OF THE INDENTURE
WHICH HAS IN IT THE TEXT OF THIS NON-CONSENTING SECURITY.



                                                                              12

                                 ASSIGNMENT FORM

To assign this Security, fill in the form below:


I or we assign and transfer this Security to

________________________________________________________________________________
              (Print or type assignee's name, address and zip code)

________________________________________________________________________________
                  (Insert assignee's soc. sec. or tax I.D. No.)


and irrevocably appoint              agent to transfer this Security on the
books of the Company. The agent may substitute another to act for him.

Date:                   Your Signature:
     -----------------                 ---------------------

(Sign exactly as your name appears on the other side of this Security.)


Signature Guarantee:

Date:
      -----------------------        --------------------------
Signature must be guaranteed         Signature of Signature
by a participant in a                Guarantee
recognized signature guaranty
medallion program or other
signature guarantor acceptable
to the Trustee



                                                                              13

                       OPTION OF HOLDER TO ELECT PURCHASE

          IF YOU WANT TO ELECT TO HAVE THIS SECURITY PURCHASED BY THE COMPANY
PURSUANT TO SECTION 4.06 (ASSET DISPOSITION) OF THE INDENTURE, CHECK THE BOX:

                              ASSET DISPOSITION / /

          IF YOU WANT TO ELECT TO HAVE ONLY PART OF THIS SECURITY PURCHASED BY
THE COMPANY PURSUANT TO SECTION 4.06 OF THE INDENTURE, STATE THE AMOUNT ($1,000
PRINCIPAL AMOUNT AT MATURITY OR AN INTEGRAL MULTIPLE THEREOF):

$


DATE:                    YOUR SIGNATURE:
     -------------------                -------------------
(SIGN EXACTLY AS YOUR NAME APPEARS ON THE OTHER SIDE OF THE SECURITY)


SIGNATURE GUARANTEE:
                    ---------------------------------------
                    SIGNATURE MUST BE GUARANTEED BY A PARTICIPANT IN A
                    RECOGNIZED SIGNATURE GUARANTY MEDALLION PROGRAM OR OTHER
                    SIGNATURE GUARANTOR ACCEPTABLE TO THE TRUSTEE



                                                                              14

                      [TO BE ATTACHED TO GLOBAL SECURITIES]

              SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY

          The initial principal amount at maturity of this Global Security is
$[   ]. The following increases or decreases in this Global Security have been
made:



                                                                         Principal amount at maturity
           Amount of decrease in          Amount of increase in          of this Global Security        Signature of authorized
Date of    principal amount at maturity   principal amount at maturity   following such decrease or     signatory of Trustee or
Exchange   of this Global Security        of this Global Security        increase                       Securities Custodian
                                                                                            





                                                                       EXHIBIT C

                         FORM OF SUPPLEMENTAL INDENTURE

                    SUPPLEMENTAL INDENTURE (this "Supplemental Indenture") dated
               as of           , among [GUARANTOR] (the "New Guarantor"), a
               subsidiary of PLIANT CORPORATION (or its successor), a Utah
               corporation (the "Company"), [OTHER EXISTING GUARANTORS] and
               WILMINGTON TRUST COMPANY, a Delaware banking corporation, as
               trustee under the indenture referred to below (the "Trustee").

                              W I T N E S S E T H :

          WHEREAS the Company and [OLD GUARANTORS] (the "Existing Guarantors")
have heretofore executed and delivered to the Trustee an Indenture dated as of
February 17, 2004, and amended and restated on May 6, 2005 (as amended and
restated, the "Indenture"), providing for the issuance of Senior Secured Notes
due 2009 (the "Securities");

          WHEREAS Section 4.11 of the Indenture provides that under certain
circumstances the Company is required to cause the New Guarantor to execute and
deliver to the Trustee a supplemental indenture pursuant to which the New
Guarantor shall unconditionally guarantee all the Company's obligations under
the Securities pursuant to a Note Guarantee on the terms and conditions set
forth herein; and

          WHEREAS pursuant to Section 9.01 of the Indenture, the Trustee, the
Company and the Existing Guarantors are authorized to execute and deliver this
Supplemental Indenture;

          NOW THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt of which is hereby acknowledged, the New
Guarantor, the Company, the Existing Guarantors and the Trustee mutually
covenant and agree for the equal and ratable benefit of the holders of the
Securities as follows:

          1. AGREEMENT TO GUARANTEE. The New Guarantor hereby agrees, jointly
and severally with all the Existing Guarantors, to unconditionally guarantee the
Company's obligations under the Securities on the terms and subject to the
conditions set forth in Article 11 the Indenture and to be bound by all other
applicable provisions of the Indenture and the Securities.

          2. RATIFICATION OF INDENTURE; SUPPLEMENTAL INDENTURES PART OF
INDENTURE. Except as expressly amended hereby, the Indenture is in all respects
ratified and confirmed and all the terms, conditions and provisions thereof
shall remain in full force and effect. This Supplemental Indenture shall form a
part of the Indenture for all



                                                                               2

purposes, and every holder of Securities heretofore or hereafter authenticated
and delivered shall be bound hereby.

          3. GOVERNING LAW. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT
GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT
THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

          4. TRUSTEE MAKES NO REPRESENTATION. The recitals contained herein
shall be taken as the statements of the Company, [NEW GUARANTOR] and the
Existing Guarantors, and the Trustee assumes no responsibility for their
correctness. The Trustee makes no representation as to the validity or
sufficiency of this Supplemental Indenture.

          5. COUNTERPARTS. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.

          6. EFFECT OF HEADINGS. The Section headings herein are for convenience
only and shall not effect the construction thereof.

          IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed as of the date first above written.

                                          [NEW GUARANTOR],

                                            by
                                              ----------------------------------
                                              Name:
                                              Title:


                                          PLIANT CORPORATION,

                                            by
                                              ----------------------------------
                                              Name:
                                              Title:



                                                                               3

                                          [OTHER EXISTING GUARANTORS],

                                            by
                                              ----------------------------------
                                              Name:
                                              Title:


                                          WILMINGTON TRUST COMPANY, as
                                          Trustee,

                                            by
                                              ----------------------------------
                                              Name:
                                              Title:



                                                                       EXHIBIT D

                                     Form of
                       Transferee Letter of Representation

Pliant Corporation
1515 Woodfield Road, Suite 600
Schaumburg, Illinois 60173


Ladies and Gentlemen:

          This certificate is delivered to request a transfer of $
principal amount of the Senior Secured Notes due 2009 (the "Notes") of Pliant
Corporation (the "Issuer").

Upon transfer, the Notes would be registered in the name of the new beneficial
owner as follows:

Name:__________________________________________________________________
Address:_______________________________________________________________
Taxpayer ID Number:____________________________________________________

The undersigned represents and warrants to you that:

1.   We are an institutional "accredited investor" (as defined in
     Rule 501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as
     amended (the "Securities Act")), purchasing for our own account or for the
     account of such an institutional "accredited investor" at least $250,000
     principal amount at maturity of the Notes, and we are acquiring the Notes
     not with a view to, or for offer or sale in connection with, any
     distribution in violation of the Securities Act. We have such knowledge and
     experience in financial and business matters as to be capable of evaluating
     the merits and risks of our investment in the Notes, and we invest in or
     purchase securities similar to the Notes in the normal course of our
     business. We, and any accounts for which we are acting, are each able to
     bear the economic risk of our or its investment.

2.   We understand that the Notes have not been registered under the
     Securities Act and, unless so registered, may not be sold except as
     permitted in the following sentence.  We agree on our own behalf and on
     behalf of any investor account for which we are purchasing Notes to
     offer, sell or otherwise transfer such Securities prior to the date
     that is two years after the later of the date of original issue and the
     last date on which the Company or any affiliate of the Company was the
     owner of such Notes (or any predecessor thereto) (the "Resale
     Restriction Termination Date") only (a) to the Company, (b) pursuant to
     a registration statement that has been declared effective under the
     Securities Act, (c) in a transaction complying with the requirements of
     Rule 144A under the Securities Act ("Rule 144A"), to a person we
     reasonably believe is a qualified institutional buyer under Rule 144A
     (a "QIB") that is purchasing for its own account or for the



                                                                               2

     account of a QIB and to whom notice is given that the transfer is being
     made in reliance on Rule 144A, (d) to an institutional "accredited
     investor" within the meaning of Rule 501(a)(1), (2), (3) or (7) under the
     Securities Act that is purchasing for its own account or for the account of
     such an institutional "accredited investor," in each case, in a minimum
     principal amount at maturity of Notes of $250,000, or (e) pursuant to any
     other available exemption from the registration requirements of the
     Securities Act, including the exemption provided for by Rule 144 thereunder
     (if available) subject in each of the foregoing cases to any requirement of
     law that the disposition of our property or the property of such investor
     account or accounts be at all times within our or their control and in
     compliance with any applicable state securities laws. The foregoing
     restrictions on resale will not apply subsequent to the Resale Restriction
     Termination Date. If any resale or other transfer of the Notes is proposed
     to be made pursuant to clause (d) above prior to the Resale Restriction
     Termination Date, the transferor shall deliver a letter from the transferee
     substantially in the form of this letter to the Company and the Trustee,
     which shall provide, among other things, that the transferee is an
     institutional "accredited investor" within the meaning of Rule 501(a)(1),
     (2), (3) or (7) under the Securities Act and that it is acquiring such
     Notes for investment purposes and not for distribution in violation of the
     Securities Act. Each purchaser acknowledges that the Company and the
     Trustee reserve the right prior to the offer, sale or other transfer prior
     to the Resale Restriction Termination Date of the Securities pursuant to
     clause (d) or (e) above to require the delivery of an opinion of counsel,
     certifications or other information satisfactory to the Company and the
     Trustee.

                                             TRANSFEREE:
                                                        ----------------------


                                              By:
                                                 -------------------------------

EX-4.27

                                                                    Exhibit 4.27

                                                                  EXECUTION COPY


                               PLIANT CORPORATION

                      11 5/8% SENIOR SECURED NOTES DUE 2009

                   EXCHANGE AND REGISTRATION RIGHTS AGREEMENT

                                                                     May 6, 2005

J.P. MORGAN SECURITIES INC.
270 Park Avenue, 5th floor
New York, New York 10017

Ladies and Gentlemen:

          Pliant Corporation, a Utah corporation (the "COMPANY"), has solicited
consents (the "CONSENTS") from holders of its outstanding 11 1/8% Senior Secured
Discount Notes due 2009 (the "NOTES") to certain amendments to the Notes and the
Indenture (as defined below) upon the terms and subject to the conditions set
forth in the solicitation agent agreement dated April 8, 2005, among the
Company, certain of the Note Guarantors (as defined below) and the Solicitation
Agent (the "SOLICITATION AGENT AGREEMENT") and the Confidential Consent
Solicitation Statement dated April 8, 2005 (as amended, the "Consent
Solicitation"). Capitalized terms used but not defined herein shall have the
meanings given to such terms in the Solicitation Agent Agreement.

          The Notes were issued pursuant to an indenture (the "INDENTURE") dated
as of February 17, 2004, by and among the Company, Pliant Corporation
International, Pliant Film Products of Mexico, Inc., Pliant Solutions
Corporation ("PLIANT SOLUTIONS"), Pliant Packaging of Canada, LLC, Uniplast
Holdings, Inc., Uniplast U.S., Inc., Turex, Inc. ("TUREX"), Pierson Industries,
Inc. ("PIERSON"), Uniplast Midwest, Inc. ("UNIPLAST MIDWEST") and Uniplast
Industries Co. (collectively, but excluding the Company, Pliant Solutions,
Turex, Pierson and Uniplast Midwest, the "NOTE GUARANTORS") and Wilmington Trust
Company, as trustee (the "TRUSTEE"). If Consents are received from the holders
of at least 66 2/3% in principal amount at maturity of the Notes and are
accepted by the Company, the Indenture will be amended and restated (the
"AMENDED AND RESTATED INDENTURE"). Notes whose holders deliver Consents that are
accepted by the Company are referred to herein as "Consenting Notes". Notes
whose holders do not deliver Consents are referred to herein as "Non-Consenting
Notes". The date on which the Amended and Restated Indenture goes into effect is
referred to herein as the "Closing Date".

          As an inducement to the Solicitation Agent to enter into the
Solicitation Agent Agreement and in satisfaction of a condition to the
obligations of the Solicitation Agent thereunder, the Company and the Note
Guarantors agree with the Solicitation Agent, for the benefit of the holders
(and the Market-Maker (as defined herein)) of the Consenting Notes, the Exchange
Notes (as defined herein) and the Private Exchange Notes (as defined herein)
(collectively, the "HOLDERS"), as follows:

          1. REGISTERED EXCHANGE OFFER. Unless, because of any change in law or
applicable interpretations thereof by the Commission's staff, the Company and
the Note Guarantors determine in good faith after consultation with counsel that
they are not permitted to effect the Registered Exchange Offer (as defined
herein), the Company and the Note Guarantors shall (i) prepare and, not later
than 75 days following the Closing Date, file with the Commission a registration
statement (the "EXCHANGE OFFER REGISTRATION STATEMENT") on an appropriate form



                                                                               2

under the Securities Act with respect to a proposed offer to the Holders of the
Consenting Notes (the "REGISTERED EXCHANGE OFFER") to issue and deliver to such
Holders, in exchange for the Consenting Notes, a like aggregate principal amount
of debt securities of the Company (the "EXCHANGE NOTES") that are identical in
all material respects to the Consenting Notes, except for the transfer
restrictions relating to the Consenting Notes and provisions relating to
liquidated damages or additional interest, (ii) use commercially reasonable
efforts to cause the Exchange Offer Registration Statement to become effective
under the Securities Act no later than 150 days after the Closing Date and the
Registered Exchange Offer to be consummated no later than 190 days after the
Closing Date and (iii) keep the Registered Exchange Offer open for not less than
20 business days (or longer, if required by applicable law) after the date on
which notice of the Registered Exchange Offer is mailed to the Holders (such
period being called the "EXCHANGE OFFER REGISTRATION PERIOD"). The Exchange
Notes will be issued under the Amended and Restated Indenture or an indenture
(the "EXCHANGE NOTES INDENTURE") among the Company, the Note Guarantors and the
Trustee or such other bank or trust company that is reasonably satisfactory to
the Solicitation Agent, as trustee (the "EXCHANGE NOTES TRUSTEE"), such
indenture to be identical in all material respects to the Amended and Restated
Indenture, except for the transfer restrictions relating to the Consenting Notes
and provisions relating to liquidated damages or additional interest (as
described above). All references in this Agreement to "prospectus" shall, except
where the context otherwise requires, include any prospectus (or amendment or
supplement thereto) filed with the Commission pursuant to Section 6 of this
Agreement.

          Upon the effectiveness of the Exchange Offer Registration Statement,
the Company shall promptly commence the Registered Exchange Offer, it being the
objective of such Registered Exchange Offer to enable each Holder electing to
exchange Consenting Notes for Exchange Notes (assuming that such Holder (a) is
not an affiliate (within the meaning of Rule 405 under the Securities Act) of
the Company or an Exchanging Dealer (as defined herein) not complying with the
requirements of the next sentence, (b) acquires the Exchange Notes in the
ordinary course of such Holder's business, (c) has no arrangements or
understandings with any person to participate in the distribution of the
Exchange Notes and (d) if such Holder is not an Exchanging Dealer (as defined
below), it is not engaged in, and does not intend to engage in, a distribution
of the Exchange Notes) and to trade such Exchange Notes from and after their
receipt without any limitations or restrictions under the Securities Act and
without material restrictions under the securities laws of the several states of
the United States. The Company, the Note Guarantors, the Solicitation Agent and
each Exchanging Dealer acknowledge that, pursuant to current interpretations by
the Commission's staff of Section 5 of the Securities Act, each Holder that is a
broker-dealer electing to exchange Consenting Notes, acquired for its own
account as a result of market-making activities or other trading activities, for
Exchange Notes (an "EXCHANGING DEALER"), is required to deliver a prospectus
containing substantially the information set forth in Annex A hereto on the
cover, in Annex B hereto in the "Exchange Offer Procedures" section and the
"Purpose of the Exchange Offer" section (if any) and in Annex C hereto in the
"Plan of Distribution" section of such prospectus in connection with a sale of
any such Exchange Notes received by such Exchanging Dealer pursuant to the
Registered Exchange Offer.

          If, prior to the consummation of the Registered Exchange Offer, any
Holder shall notify the Company in writing that it holds any Consenting Notes
acquired by it that have, or that are reasonably likely to be determined to
have, the status of an unsold allotment in an initial distribution, or any
Holder notifies the Company in writing that it believes that it is not entitled
to participate in the Registered Exchange Offer (other than because it has an
understanding or



                                                                               3

arrangement with any person to participate in the distribution of the Exchange
Notes) and such Holder has not received a written opinion from counsel to the
Company, reasonably acceptable to such Holder to the effect that such Holder is
legally permitted to participate in the Registered Exchange Offer, the Company
shall, upon the request of any such Holder, simultaneously with the delivery of
the Exchange Notes in the Registered Exchange Offer, issue and deliver to any
such Holder, in exchange for the Consenting Notes held by such Holder (the
"PRIVATE EXCHANGE"), a like aggregate principal amount of debt securities of the
Company (the "PRIVATE EXCHANGE NOTES") that are identical in all material
respects to the Exchange Notes, except for the transfer restrictions relating to
such Private Exchange Notes and provisions relating to liquidated damages and
additional interest. The Private Exchange Notes will be issued under the same
indenture as the Exchange Notes, and, if permitted under the policies
established at such time by the CUSIP Service Bureau of Standard & Poor's
Corporation, the Company shall use commercially reasonable efforts to cause the
Private Exchange Notes to bear the same CUSIP number as the Exchange Notes.

          In connection with the Registered Exchange Offer, the Company shall:

          (a) mail to each Holder a copy of the prospectus forming part of the
     Exchange Offer Registration Statement, together with an appropriate letter
     of transmittal and related documents;

          (b) keep the Registered Exchange Offer open for not less than 20
     business days (or longer, if required by applicable law) after the date on
     which notice of the Registered Exchange Offer is mailed to the Holders;

          (c) utilize the services of a depositary for the Registered Exchange
     Offer with an address in the Borough of Manhattan, The City of New York;

          (d) permit Holders to withdraw tendered Consenting Notes at any time
     prior to the close of business, New York City time, on the last business
     day on which the Registered Exchange Offer shall remain open; and

          (e) otherwise comply in all respects with all laws that are applicable
     to the Registered Exchange Offer.

          As soon as practicable after the close of the Registered Exchange
Offer and any Private Exchange, as the case may be, the Company shall:

          (a) accept for exchange all Consenting Notes tendered and not validly
     withdrawn pursuant to the Registered Exchange Offer and the Private
     Exchange;

          (b) deliver to the Trustee for cancelation all Consenting Notes so
     accepted for exchange; and

          (c) cause the Trustee or the Exchange Notes Trustee, as the case may
     be, promptly to authenticate and deliver to each Holder, Exchange Notes or
     Private Exchange Notes, as the case may be, equal in principal amount at
     maturity to the Consenting Notes of such Holder so accepted for exchange.



                                                                               4

          The Company and the Note Guarantors shall use commercially reasonable
efforts to keep the Exchange Offer Registration Statement effective and to amend
and supplement the prospectus contained therein in order to permit such
prospectus to be used by all persons (including Exchanging Dealers) subject to
the prospectus delivery requirements of the Securities Act for 180 days after
the consummation of the Registered Exchange Offer (such 180 days, the
"APPLICABLE PERIOD").

          Subject to limited exceptions, the Amended and Restated Indenture or
the Exchange Notes Indenture, as the case may be, shall provide that the
Consenting Notes, the Exchange Notes, the Non-Consenting Notes and the Private
Exchange Notes shall vote and consent together on all matters as one class and
that none of the Consenting Notes, the Exchange Notes, the Non-Consenting Notes
or the Private Exchange Notes will have the right to vote or consent as a
separate class on any matter.

          Interest on each Exchange Note and Private Exchange Note issued
pursuant to the Registered Exchange Offer and in the Private Exchange will
accrue from the last interest payment date on which interest was paid on the
Consenting Notes surrendered in exchange therefor or, if no interest has been
paid on the Consenting Notes, from the Closing Date.

          Each Holder participating in the Registered Exchange Offer shall be
required to represent to the Company and the Note Guarantors in writing (which
may be contained in the applicable letter of transmittal) that at the time of
the consummation of the Registered Exchange Offer (i) any Exchange Notes
received by such Holder will be acquired in the ordinary course of business,
(ii) such Holder will have no arrangements or understanding with any person to
participate in the distribution of the Consenting Notes or the Exchange Notes
within the meaning of the Securities Act, (iii) such Holder is not an affiliate
(within the meaning of Rule 405 under the Securities Act) of the Company or, if
it is such an affiliate, such Holder will comply with the registration and
prospectus delivery requirements of the Securities Act to the extent applicable
and (iv) if such Holder is a broker-dealer, that it will deliver a prospectus in
connection with any resale of such Exchange Notes during the Applicable Period.

          Notwithstanding any other provisions hereof, the Company and the Note
Guarantors will ensure that (i) any Exchange Offer Registration Statement and
any amendment thereto and any prospectus forming part thereof and any supplement
thereto complies in all material respects with the Securities Act and the rules
and regulations of the Commission thereunder, (ii) any Exchange Offer
Registration Statement and any amendment thereto does not, when it becomes
effective, contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading and (iii) any prospectus forming part of any Exchange
Offer Registration Statement, and any supplement to such prospectus, does not,
as of the consummation of the Registered Exchange Offer, include an untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances under which
they were made, not misleading.

          2. SHELF REGISTRATION. If (i) because of any change in law or
applicable interpretations thereof by the Commission's staff the Company and the
Note Guarantors determine in good faith after consultation with counsel that
they are not permitted to effect the Registered Exchange Offer as contemplated
by Section 1 hereof, or (ii) any Consenting Notes validly tendered pursuant to
the Registered Exchange Offer are not exchanged for Exchange



                                                                               5

Notes within 190 days after the Closing Date, or (iii) the Solicitation Agent so
requests with respect to Consenting Notes or Private Exchange Notes not eligible
to be exchanged for Exchange Notes in the Registered Exchange Offer, or (iv) any
applicable law or interpretations do not permit any Holder to participate in the
Registered Exchange Offer (other than because such Holder has an understanding
or arrangement with any person to participate in the distribution of the
Exchange Notes), or (v) any Holder that participates in the Registered Exchange
Offer notifies the Company in writing within 30 days following the consummation
of the Registered Exchange Offer that such Holder may not resell the Exchange
Notes acquired by it in the Registered Exchange Offer to the public without
delivering a prospectus and the prospectus contained in the Exchange Offer
Registration Statement is not legally available for such resales by such Holder,
or (vi) the Company so elects, then the following provisions shall apply:

          (a) The Company and the Note Guarantors shall use commercially
     reasonable efforts to file as promptly as practicable (but in no event more
     than 60 days after so required or requested pursuant to this Section 2;
     PROVIDED that in the case of any filing in response to clause (i) or (iii)
     or (iv) of the preceding paragraph, the Company and the Note Guarantors
     shall not be required to make any such filing earlier than 75 days
     following the Closing Date (the date of such filing, the "SHELF FILING
     DATE")) with the Commission, and thereafter shall use commercially
     reasonable efforts to cause to be declared effective on or prior to 115
     days after the Shelf Filing Date (but, in the case of any filing in
     response to clause (i), (iii), (iv) or (vi) of the preceding paragraph, in
     no event earlier than the 190th day after the Closing Date), a shelf
     registration statement on an appropriate form under the Securities Act
     relating to the offer and sale of the Transfer Restricted Notes (as defined
     below) by the Holders thereof from time to time in accordance with the
     methods of distribution set forth in such registration statement
     (hereafter, a "SHELF REGISTRATION STATEMENT" and, together with any
     Exchange Offer Registration Statement, a "REGISTRATION STATEMENT").

          (b) The Company and the Note Guarantors shall use commercially
     reasonable efforts to keep the Shelf Registration Statement continuously
     effective in order to permit the prospectus forming part thereof to be used
     by Holders of Transfer Restricted Notes for a period ending on the earlier
     of (i) two years from the Closing Date or such shorter period that will
     terminate when all the Transfer Restricted Notes covered by the Shelf
     Registration Statement have been sold pursuant thereto and (ii) the date on
     which the Consenting Notes become eligible for resale without volume
     restrictions pursuant to Rule 144 under the Securities Act (in any such
     case, such period being called the "SHELF REGISTRATION PERIOD"). The
     Company and the Note Guarantors shall be deemed not to have used
     commercially reasonable efforts to keep the Shelf Registration Statement
     effective during the requisite period if any of them voluntarily take any
     action that would result in Holders of Transfer Restricted Notes covered
     thereby not being able to offer and sell such Transfer Restricted Notes
     during that period, unless (A) such action is required by applicable law or
     (B) such action was permitted by Section 2(c).

          (c) Notwithstanding the provisions of Section 2(b) (but subject to the
     provisions of Section 3(b)), the Company and the Note Guarantors may for
     valid business reasons, including without limitation, a potential
     acquisition, divestiture of assets or other material corporate transaction,
     issue a notice that the Shelf Registration Statement is no longer effective
     or the prospectus included therein is no longer usable for offers and sales
     of Transfer Restricted Notes and may issue any notice suspending use of the
     Shelf



                                                                               6

     Registration Statement required under applicable securities laws to be
     issued. The provisions of this Section 2(c) shall also be applicable to the
     Exchange Offer Registration Statement during the Applicable Period;
     PROVIDED that the Applicable Period shall be extended for the number of
     days (which shall not exceed 60) that the use of the Exchange Offer
     Registration Statement is suspended.

          (d) Notwithstanding any other provisions hereof, the Company and the
     Note Guarantors shall ensure that (i) any Shelf Registration Statement and
     any amendment thereto and any prospectus forming part thereof and any
     supplement thereto complies in all material respects with the Securities
     Act and the rules and regulations of the Commission thereunder, (ii) any
     Shelf Registration Statement and any amendment thereto (in either case,
     other than with respect to information included therein in reliance upon or
     in conformity with written information furnished to the Company by or on
     behalf of any Holder specifically for use therein (the "HOLDERS'
     INFORMATION")) does not contain an untrue statement of a material fact or
     omit to state a material fact required to be stated therein or necessary to
     make the statements therein not misleading and (iii) any prospectus forming
     part of any Shelf Registration Statement, and any supplement to such
     prospectus (in either case, other than with respect to Holders'
     Information), does not include an untrue statement of a material fact or
     omit to state a material fact necessary in order to make the statements
     therein, in the light of the circumstances under which they were made, not
     misleading.

          3. LIQUIDATED DAMAGES. (a) The parties hereto agree that the Holders
of Transfer Restricted Notes will suffer damages if the Company and the Note
Guarantors fail to fulfill their obligations under Section 1 or Section 2, as
applicable, and that it would not be feasible to ascertain the extent of such
damages. Accordingly, if (i) the applicable Registration Statement is not filed
with the Commission on or prior to the date specified in this Agreement, (ii)
the Exchange Offer Registration Statement or the Shelf Registration Statement,
as the case may be, is not declared effective on or prior to the date specified
in this Agreement, (iii) the Registered Exchange Offer is not consummated on or
prior to 190 days after the Closing Date (other than in the event the Company is
requested or required or elected to file a Shelf Registration Statement), or
(iv) the Shelf Registration Statement is filed and declared effective on or
prior to the date specified in this Agreement but shall thereafter cease to be
effective (at any time that the Company and the Note Guarantors are obligated to
maintain the effectiveness thereof) without being succeeded within 60 days by an
additional Registration Statement or a post-effective amendment to the Shelf
Registration Statement filed and declared effective (each such event referred to
in clauses (i) through (iv), a "REGISTRATION DEFAULT"), the interest rate on the
Transfer Restricted Notes will be increased by 1.00% per annum (the amount paid
as a result of such increase being herein referred to as "liquidated damages")
until (i) the applicable Registration Statement is filed, (ii) the Exchange
Offer Registration Statement is declared effective and the Registered Exchange
Offer is consummated, (iii) the Shelf Registration Statement is declared
effective or (iv) the Shelf Registration Statement again becomes effective, an
additional Registration Statement becomes effective or a post-effective
amendment to the Shelf Registration Statement becomes effective, as the case may
be. Following the cure of all Registration Defaults, the accrual of liquidated
damages will cease. As used herein, the term "TRANSFER RESTRICTED NOTES" means
(i) each Consenting Note until the date on which such Consenting Note has been
exchanged for a freely transferable Exchange Note in the Registered Exchange
Offer (it being understood that the requirement that an Exchanging Dealer
deliver a prospectus in connection with sales of Exchange Notes acquired in the
Registered Exchange



                                                                               7

Offer shall not mean that the Exchange Note is not freely transferable for
purposes of this Section 3), (ii) each Consenting Note or Private Exchange Note
until the date on which it has been effectively registered under the Securities
Act and disposed of in accordance with the Shelf Registration Statement or (iii)
each Consenting Note or Private Exchange Note until the date on which it is
distributed to the public pursuant to Rule 144 under the Securities Act or is
saleable pursuant to Rule 144(k) under the Securities Act. Notwithstanding
anything to the contrary in this Section 3(a), the Company shall not be required
to pay liquidated damages to a Holder of Transfer Restricted Notes if such
Holder failed to comply with its obligations to make the representations set
forth in the second to last paragraph of Section 1 or failed to provide the
information required to be provided by it, if any, pursuant to Section 4(o).

          (b) Notwithstanding the foregoing provisions of Section 3(a), the
Company and the Note Guarantors may for valid business reasons, including
without limitation, a potential acquisition, divestiture of assets or other
material corporate transaction, issue a notice that the Shelf Registration
Statement is no longer effective or the prospectus included therein is no longer
usable for offers and sales of Transfer Restricted Notes and may issue any
notice suspending use of the Shelf Registration Statement required under
applicable securities laws to be issued and, in the event that the aggregate
number of days in any consecutive twelve-month period for which all such notices
are issued and effective exceeds 60 days in the aggregate, then the interest
rate on the Transfer Restricted Notes covered by the Shelf Registration
Statement will be increased by 1.00% per annum (the amount paid as a result of
such increase being herein referred to as "liquidated damages"). Upon the
Company and the Note Guarantors declaring that the Shelf Registration Statement
is useable after the period of time described in the preceding sentence, accrual
of liquidated damages shall cease; PROVIDED, HOWEVER, that if after any such
cessation of the accrual of liquidated damages the Shelf Registration Statement
again ceases to be useable beyond the period permitted above, liquidated damages
will again accrue pursuant to the foregoing provisions.

          (c) The Company shall notify the Trustee and the Paying Agent under
the Indenture immediately upon the happening of each and every Registration
Default. Each obligation to pay liquidated damages shall be deemed to accrue
from and including the date of the applicable Registration Default. The
liquidated damages due shall be payable on each interest payment date and in the
form specified by the Amended and Restated Indenture and the Consenting Notes to
the record holder entitled to receive the interest payment to be made on such
date.

          (d) The parties hereto agree that the liquidated damages provided for
in this Section 3 constitute a reasonable estimate of and are intended to
constitute the sole damages that will be suffered by Holders of Transfer
Restricted Notes by reason of the failure of (i) the Shelf Registration
Statement or the Exchange Offer Registration Statement to be filed, (ii) the
Shelf Registration Statement to remain effective or (iii) the Exchange Offer
Registration Statement to be declared effective and the Registered Exchange
Offer to be consummated, in each case to the extent required by this Agreement.

          4. REGISTRATION PROCEDURES. In connection with any Registration
Statement, the following provisions shall apply:

          (a) The Company shall (i) furnish to the Solicitation Agent, prior to
     the filing thereof with the Commission, a copy of the Exchange Offer
     Registration Statement and



                                                                               8

     each amendment thereof and each supplement, if any, to the prospectus
     included therein and shall use commercially reasonable efforts to reflect
     in each such document, when so filed with the Commission, such comments as
     the Solicitation Agent may reasonably propose; (ii) include information
     substantially as set forth in Annex A hereto on the cover, in Annex B
     hereto in the "Exchange Offer Procedures" section and the "Purpose of the
     Exchange Offer" section (if any) and in Annex C hereto in the "Plan of
     Distribution" section of the prospectus forming a part of the Exchange
     Offer Registration Statement, and include information substantially as set
     forth in Annex D hereto in the Letter of Transmittal delivered pursuant to
     the Registered Exchange Offer; and (iii) if requested in writing by the
     Solicitation Agent, include the information required by Items 507 or 508 of
     Regulation S-K, as applicable, in the prospectus forming a part of the
     Exchange Offer Registration Statement.

          (b) The Company shall advise the Solicitation Agent, each Exchanging
     Dealer and the Holders (if applicable) and, if requested by any such
     person, confirm such advice in writing (which advice pursuant to clauses
     (ii)-(v) hereof shall be accompanied by an instruction to suspend the use
     of the prospectus until the requisite changes have been made):

               (i) when any Registration Statement and any amendment thereto has
          been filed with the Commission and when such Registration Statement or
          any post-effective amendment thereto has become effective;

               (ii) of any request by the Commission for amendments or
          supplements to any Registration Statement or the prospectus included
          therein or for additional information;

               (iii) of the issuance by the Commission of any stop order
          suspending the effectiveness of any Registration Statement or the
          initiation of any proceedings for that purpose;

               (iv) of the receipt by the Company of any notification with
          respect to the suspension of the qualification of the Consenting
          Notes, the Exchange Notes or the Private Exchange Notes for sale in
          any jurisdiction or the initiation or threatening of any proceeding
          for such purpose; and

               (v) of the happening of any event that requires the making of any
          changes in any Registration Statement or the prospectus included
          therein in order that the statements therein are not misleading and do
          not omit to state a material fact required to be stated therein or
          necessary to make the statements therein not misleading.

          (c) The Company and the Note Guarantors will make every reasonable
     effort to obtain the withdrawal at the earliest possible time of any order
     suspending the effectiveness of any Registration Statement.

          (d) The Company will furnish to each Holder of Transfer Restricted
     Notes included within the coverage of any Shelf Registration Statement,
     without charge, at least one conformed copy of such Shelf Registration
     Statement and any post-effective amendment thereto, including financial
     statements and schedules and, if any such Holder



                                                                               9

     so requests in writing, all exhibits thereto (including those, if any,
     incorporated by reference).

          (e) The Company will, during the Shelf Registration Period, promptly
     deliver to each Holder of Transfer Restricted Notes included within the
     coverage of any Shelf Registration Statement, without charge, as many
     copies of the prospectus (including each preliminary prospectus) included
     in such Shelf Registration Statement and any amendment or supplement
     thereto as such Holder may reasonably request; and the Company consents to
     the use of such prospectus or any amendment or supplement thereto by each
     of the selling Holders of Transfer Restricted Notes in connection with the
     offer and sale of the Transfer Restricted Notes covered by such prospectus
     or any amendment or supplement thereto.

          (f) The Company will furnish to the Solicitation Agent, each
     Exchanging Dealer who so requests in writing, and to any other Holder who
     so requests in writing, without charge, at least one conformed copy of the
     Exchange Offer Registration Statement and any post-effective amendment
     thereto, including financial statements and schedules and, if the
     Solicitation Agent or Exchanging Dealer or any such Holder so requests in
     writing, all exhibits thereto (including those, if any, incorporated by
     reference).

          (g) The Company will, during the Exchange Offer Registration Period or
     the Shelf Registration Period, as applicable, promptly deliver to the
     Solicitation Agent, each Exchanging Dealer and such other persons that are
     required to deliver a prospectus following the Registered Exchange Offer,
     without charge, as many copies of the final prospectus included in the
     Exchange Offer Registration Statement or the Shelf Registration Statement
     and any amendment or supplement thereto as the Solicitation Agent, such
     Exchanging Dealer or other persons may reasonably request in writing; and
     the Company and the Note Guarantors consent to the use of such prospectus
     or any amendment or supplement thereto by the Solicitation Agent, such
     Exchanging Dealer or other persons, as applicable, as aforesaid.

          (h) Prior to the effective date of any Registration Statement, the
     Company and the Note Guarantors will use commercially reasonable efforts to
     register or qualify, or cooperate with the Holders of Consenting Notes,
     Exchange Notes or Private Exchange Notes included therein and their
     respective counsel in connection with the registration or qualification of,
     such Consenting Notes, Exchange Notes or Private Exchange Notes for offer
     and sale under the securities or blue sky laws of such jurisdictions as any
     such Holder reasonably requests in writing and do any and all other acts or
     things necessary or advisable to enable the offer and sale in such
     jurisdictions of the Consenting Notes, Exchange Notes or Private Exchange
     Notes covered by such Registration Statement; PROVIDED that the Company and
     the Note Guarantors will not be required to qualify generally to do
     business in any jurisdiction where they are not then so qualified or to
     take any action which would subject them to general service of process or
     to taxation in any such jurisdiction where they are not then so subject.

          (i) The Company and the Note Guarantors will cooperate with the
     Holders of Consenting Notes, Exchange Notes or Private Exchange Notes to
     facilitate the timely preparation and delivery of certificates representing
     Consenting Notes, Exchange Notes or Private Exchange Notes to be sold
     pursuant to any Registration Statement free of any restrictive legends and
     in such denominations and registered in such names as the



                                                                              10

     Holders thereof may request in writing prior to sales of Consenting Notes,
     Exchange Notes or Private Exchange Notes pursuant to such Registration
     Statement.

          (j) If any event contemplated by Section 4(b)(ii) through (v) occurs
     during the period for which the Company and the Note Guarantors are
     required to maintain an effective Registration Statement, the Company and
     the Note Guarantors will promptly prepare and file with the Commission a
     post-effective amendment to the Registration Statement or a supplement to
     the related prospectus or file any other required document so that, as
     thereafter delivered to purchasers of the Consenting Notes, Exchange Notes
     or Private Exchange Notes from a Holder, the prospectus will not include an
     untrue statement of a material fact or omit to state a material fact
     necessary in order to make the statements therein, in the light of the
     circumstances under which they were made, not misleading.

          (k) If any event contemplated by Section 2(c) or 3(b) occurs during
     the period for which the Company and the Note Guarantors are required to
     maintain an effective Registration Statement, the Company and the Note
     Guarantors will, to the extent required after the end of the applicable
     periods referred to in Sections 2(c) and 3(b), promptly prepare and file
     with the Commission a post-effective amendment to the Registration
     Statement or a supplement to the related prospectus or file any other
     required document so that, as thereafter delivered to purchasers of the
     Consenting Notes, Exchange Notes or Private Exchange Notes from a Holder,
     the prospectus will not include an untrue statement of a material fact or
     omit to state a material fact necessary in order to make the statements
     therein, in the light of the circumstances under which they were made, not
     misleading.

          (l) Not later than the effective date of the applicable Registration
     Statement, the Company will provide a CUSIP number for the Consenting
     Notes, the Exchange Notes and the Private Exchange Notes, as the case may
     be, and provide the applicable trustee with certificates for the Consenting
     Notes, the Exchange Notes or the Private Exchange Notes, as the case may
     be, in a form eligible for deposit with The Depository Trust Company.

          (m) The Company and the Note Guarantors will comply with all
     applicable rules and regulations of the Commission and the Company and the
     Note Guarantors will make generally available to their security holders as
     soon as practicable after the effective date of the applicable Registration
     Statement an earnings statement of the Company satisfying the provisions of
     Section 11(a) of the Securities Act; PROVIDED that in no event shall such
     earning statement be delivered later than 45 days after the end of a
     12-month period (or 90 days, if such period is a fiscal year) beginning
     with the first month of the Company's first fiscal quarter commencing after
     the effective date of the applicable Registration Statement, which
     statement shall cover such 12-month period.

          (n) The Company and the Note Guarantors will cause the Amended and
     Restated Indenture or the Exchange Notes Indenture, as the case may be, to
     be qualified under the Trust Indenture Act as required by applicable law in
     a timely manner.

          (o) The Company may require each Holder of Transfer Restricted Notes
     to be registered pursuant to any Shelf Registration Statement to furnish to
     the Company such information concerning the Holder and the distribution of
     such Transfer Restricted Notes



                                                                              11

     as the Company may from time to time reasonably require for inclusion in
     such Shelf Registration Statement, and the Company may exclude from such
     registration the Transfer Restricted Notes of any Holder that fails to
     furnish such information within a reasonable time after receiving such
     request. Each Holder of Transfer Restricted Notes as to which a Shelf
     Registration Statement is being effected, by its participation in the Shelf
     Registration Statement, shall be deemed to agree to furnish the Company and
     the Note Guarantors all information concerning such Holder required to be
     described in order to make the information previously furnished by such
     Holder to the Company and the Note Guarantors not materially misleading.

          (p) In the case of (A) a Shelf Registration Statement, each Holder of
     Transfer Restricted Notes to be registered pursuant thereto agrees by
     acquisition of such Transfer Restricted Notes that, and (B) the Exchange
     Offer Registration Statement during the Applicable Period only, each Holder
     of Exchange Notes subject to the prospectus delivery requirements of the
     Securities Act agrees that, upon receipt of any notice from the Company
     pursuant to Sections 2(c), 3(b) or 4(b)(ii) through (v), such Holder will
     discontinue disposition of such Transfer Restricted Notes or Exchange
     Notes, as applicable, until such Holder's receipt of copies of the
     supplemental or amended prospectus contemplated by Section 4(j) or 4(k), as
     the case may be, or until advised in writing by the Company that the use of
     the applicable prospectus may be resumed (the "Advice"). If the Company
     shall give any notice under Sections 2(c), 3(b) or 4(b)(ii) through (v)
     during the period that the Company is required to maintain an effective
     Registration Statement (the "EFFECTIVENESS PERIOD"), such Effectiveness
     Period shall be extended by the number of days during such period from and
     including the date of the giving of such notice to and including the date
     when each seller of Transfer Restricted Notes or Exchange Notes, as
     applicable, covered by such Registration Statement shall have received (x)
     the copies of the supplemental or amended prospectus contemplated by
     Section 4(j) or 4(k), as the case may be, (if an amended or supplemental
     prospectus is required) or (y) the Advice (if no amended or supplemental
     prospectus is required).

          (q) In the case of a Shelf Registration Statement, the Company and the
     Note Guarantors shall enter into such customary agreements (including, if
     requested by Holders of a majority in aggregate principal amount of the
     Consenting Notes, an underwriting agreement in customary form) and take all
     such other action, if any, as Holders of a majority in aggregate principal
     amount of the Consenting Notes, Exchange Notes and Private Exchange Notes
     covered by the Shelf Registration Statement or the managing underwriters
     (if any) shall reasonably request in order to facilitate any disposition of
     Consenting Notes, Exchange Notes or Private Exchange Notes pursuant to such
     Shelf Registration Statement. Notwithstanding anything to the contrary
     contained in this Agreement, the Company and the Note Guarantors shall not
     be required to engage in more than one underwritten offering pursuant to
     this Agreement.

          (r) In the case of a Shelf Registration Statement, the Company shall
     (i) make reasonably available for inspection by a representative of, and
     Special Counsel (as defined below) acting for, Holders of a majority in
     aggregate principal amount of the Consenting Notes, Exchange Notes and
     Private Exchange Notes covered by the Shelf Registration Statement and any
     underwriter participating in any disposition of Consenting Notes, Exchange
     Notes or Private Exchange Notes pursuant to such Shelf Registration
     Statement, all relevant financial and other records, pertinent corporate
     documents and



                                                                              12

     properties of the Company and its subsidiaries and (ii) use commercially
     reasonable efforts to have its officers, directors, employees, accountants
     and counsel supply all relevant information reasonably requested by such
     representative, Special Counsel or any such underwriter (an "INSPECTOR") in
     connection with such Shelf Registration Statement.

          (s) In the case of a Shelf Registration Statement, the Company shall,
     if requested by Holders of a majority in aggregate principal amount of the
     Consenting Notes, Exchange Notes and Private Exchange Notes covered by the
     Shelf Registration Statement, their Special Counsel or the managing
     underwriters (if any) in connection with such Shelf Registration Statement,
     use commercially reasonable efforts to cause (i) its counsel to deliver an
     opinion relating to the Shelf Registration Statement and the Consenting
     Notes, Exchange Notes or Private Exchange Notes, as applicable, in
     customary form, (ii) its officers to execute and deliver all customary
     documents and certificates requested by Holders of a majority in aggregate
     principal amount of the Consenting Notes, Exchange Notes and Private
     Exchange Notes being sold, its Special Counsel or the managing underwriters
     (if any) and (iii) its independent public accountants to provide a comfort
     letter or letters in customary form, subject to receipt of appropriate
     documentation as contemplated, and only if permitted, by Statement of
     Auditing Standards No. 72.

          5. REGISTRATION EXPENSES. The Company and the Note Guarantors will
jointly and severally bear all expenses incurred in connection with the
performance of their obligations under Sections 1, 2, 3 and 4 and the Company
will reimburse the Solicitation Agent or the Holders, as applicable, for the
reasonable fees and disbursements of one firm of attorneys (in addition to any
local counsel) chosen by the Holders of a majority in aggregate principal amount
of the Consenting Notes, the Exchange Notes and the Private Exchange Notes
covered by each Registration Statement (the "SPECIAL COUNSEL") acting for the
Solicitation Agent or Holders in connection therewith. The Company and the Note
Guarantors are not required to pay any commissions or concessions of any
broker-dealers.

          6. MARKET-MAKING. (a) For so long as any of the Consenting Notes,
Exchange Notes or Private Exchange Notes are outstanding and JPMorgan (in such
capacity, the "Market-Maker") or any of its affiliates (as defined in the rules
and regulations of the Commission) owns any equity securities of the Company,
the Note Guarantors or any of their affiliates and proposes to make a market in
the Consenting Notes, Exchange Notes or Private Exchange Notes as part of its
business in the ordinary course, the following provisions shall apply for the
sole benefit of the Market-Maker:

          (i) The Company and the Note Guarantors shall (A) on the date that the
     Exchange Offer Registration Statement or, if required hereby, the Shelf
     Registration Statement, is filed with the Commission, file a registration
     statement (the "Market-Making Registration Statement") (which may be the
     Exchange Offer Registration Statement or the Shelf Registration Statement
     if permitted by the rules and regulations of the Commission) and use
     commercially reasonable efforts to cause such Market-Making Registration
     Statement to be declared effective by the Commission on or prior to the
     consummation of the Exchange Offer or the effective date of the Shelf
     Registration Statement, as applicable; (B) periodically amend such
     Market-Making Registration Statement so that the information contained
     therein complies with the requirements of Section 10(a) under the
     Securities Act; (C) if reasonably requested in writing by the



                                                                              13

     Market-Maker, within 45 days following the end of each of the Company's
     fiscal quarters (other than the fourth quarter), file a supplement to the
     prospectus contained in the Market-Making Registration Statement that sets
     forth the financial results of the Company for such quarter; (D) amend the
     Market-Making Registration Statement or amend or supplement the related
     prospectus when necessary to reflect any material changes in the
     information provided therein; and (E) amend the Market-Making Registration
     Statement when required to do so in order to comply with Section 10(a)(3)
     of the Securities Act; PROVIDED, HOWEVER, that (1) prior to filing the
     Market-Making Registration Statement, any amendment thereto or any
     amendment or supplement to the related prospectus (other than a supplement
     filed pursuant to clause (C) of this paragraph unless the Market-Maker
     reasonably requests), the Company will furnish to the Market-Maker copies
     of all such documents proposed to be filed, which documents will be subject
     to the review of the Market-Maker and its counsel and (2) the Company and
     the Note Guarantors will not file the Market-Making Registration Statement,
     any amendment thereto or any supplement to the related prospectus (other
     than a supplement filed pursuant to clause (C) of this paragraph unless the
     Market-Maker reasonably requests) to which the Market-Maker and its counsel
     shall reasonably object unless the Company and the Note Guarantors are
     advised by counsel that such Market-Making Registration Statement,
     amendment or supplement is required to be filed under applicable securities
     laws and the Company will provide the Market-Maker and its counsel with
     copies of the Market-Making Registration Statement and each amendment and
     supplement filed.

          (ii) The Company shall notify the Market-Maker and, if requested by
     the Market-Maker, confirm such advice in writing, (A) when any
     Market-Making Registration Statement, any post-effective amendment to the
     Market-Making Registration Statement or any amendment or supplement to the
     related prospectus has been filed, and, with respect to any post-effective
     amendment, when the same has become effective; (B) of any request by the
     Commission for any post-effective amendment to the Market-Making
     Registration Statement, any supplement or amendment to the related
     prospectus or for additional information; (C) the issuance by the
     Commission of any stop order suspending the effectiveness of the
     Market-Making Registration Statement or the initiation of any proceedings
     for that purpose; (D) of the receipt by the Company of any notification
     with respect to the suspension of the qualification of the Consenting Notes
     or Exchange Notes for sale in any jurisdiction or the initiation or
     threatening of any proceedings for such purpose; (E) of the happening of
     any event that makes any statement made in the Market-Making Registration
     Statement, the related prospectus or any amendment or supplement thereto
     untrue or that requires the making of any changes in the Market-Making
     Registration Statement, such prospectus or any amendment or supplement
     thereto, in order to make the statements therein not misleading; and (F) of
     any advice from a nationally recognized statistical rating organization
     that such organization has placed the Company under surveillance or review
     with negative implications or has determined to downgrade the rating of the
     Consenting Notes, Exchange Notes or Private Exchange Notes or any other
     debt obligation of the Company whether or not such downgrade shall have
     been publicly announced.

          (iii) If any event contemplated by Section 6(a)(ii)(B) through (E)
     occurs during the period for which the Company and the Note Guarantors are
     required to maintain an effective Market-Making Registration Statement, the
     Company and the Note Guarantors shall promptly prepare and file with the
     Commission a post-effective amendment to the



                                                                              14

     Market-Making Registration Statement or an amendment or supplement to the
     related prospectus or file any other required document so that the
     prospectus will not include an untrue statement of a material fact or omit
     to state a material fact necessary in order to make the statements therein,
     in the light of the circumstances under which they were made, not
     misleading.

          (iv) In the event of the issuance of any stop order suspending the
     effectiveness of the Market-Making Registration Statement or of any order
     suspending the qualification of the Consenting Notes, Exchange Notes or
     Private Exchange Notes for sale in any jurisdiction, the Company and the
     Note Guarantors shall use promptly commercially reasonable efforts to
     obtain its withdrawal.

          (v) The Company shall furnish to the Market-Maker, without charge, (i)
     at least one conformed copy of the Market-Making Registration Statement and
     any post-effective amendment thereto; and (ii) as many copies of the
     related prospectus and any amendment or supplement thereto as the
     Market-Maker may reasonably request.

          (vi) The Company and the Note Guarantors shall consent to the use of
     the prospectus contained in the Market-Making Registration Statement or any
     amendment or supplement thereto by the Market-Maker in connection with its
     market making activities.

          (vii) For so long as the Consenting Notes, Exchange Notes or Private
     Exchange Notes shall be outstanding, the Company shall furnish to the
     Market-Maker (A) as soon as practicable after the end of each of the
     Company's fiscal years, the number of copies reasonably requested by the
     Market-Maker of the Company's annual report for such year, (B) as soon as
     available, the number of copies reasonably requested by the Market-Maker of
     each report (including, without limitation, reports on Forms 10-K, 10-Q and
     8-K) or definitive proxy statements of the Company filed under the Exchange
     Act or mailed to stockholders and (C) all public reports and all reports
     and financial statements furnished by the Company to the Nasdaq National
     Market System or any U.S. national securities exchange or quotation service
     upon which the Consenting Notes or Exchange Notes may be listed pursuant to
     requirements of or agreements with such exchange or quotation service or to
     the Commission pursuant to the Exchange Act or any rule or regulation of
     the Commission thereunder.

          (viii) Notwithstanding the foregoing provisions of Section 6, the
     Company and the Note Guarantors may for valid business reasons, including
     without limitation, a potential material acquisition, divestiture of assets
     or other material corporate transaction, notify the Market-Maker in writing
     that the Market-Making Registration Statement is no longer effective or the
     prospectus included therein is no longer usable for offers and sales of
     Consenting Notes, Exchange Notes or Private Exchange Notes; PROVIDED that
     the use of the Market-Making Registration Statement or the prospectus
     contained therein shall not be suspended for more than 60 days in the
     aggregate in any consecutive 12 month period. The Market-Maker agrees that
     upon receipt of any notice from the Company pursuant to Section 6(a)(ii)(B)
     through (E) or this Section 6(a)(viii), it will discontinue use of the
     prospectus contained in the Market-Making Registration Statement until
     receipt of copies of the supplemented or amended prospectus relating
     thereto or until advised in writing by the Company that the use of the
     prospectus contained in the Market-Making Registration Statement may be
     resumed.



                                                                              15

          (b) In connection with the Market-Making Registration Statement, the
Company shall (i) make reasonably available for inspection by a representative
of, and counsel acting for, the Market-Maker all relevant financial and other
records, pertinent corporate documents and properties of the Company and its
subsidiaries and (ii) use its commercially reasonable efforts to have its
officers, directors, employees, accountants and counsel supply all relevant
information reasonably requested by such representative or counsel or the
Market-Maker.

          (c) Prior to the effective date of the Market-Making Registration
Statement, the Company and the Note Guarantors will use commercially reasonable
efforts to register or qualify, or cooperate with the Market-Maker and its
counsel in connection with the registration or qualification of, the Consenting
Notes, Exchange Notes or Private Exchange Notes for offer and sale under the
securities or blue sky laws of such jurisdictions as the Market-Maker reasonably
requests in writing and do any and all other acts or things necessary or
advisable to enable the offer and sale in such jurisdictions of the Consenting
Notes, Exchange Notes or Private Exchange Notes covered by the Market-Making
Registration Statement; PROVIDED that the Company and the Note Guarantors will
not be required to qualify generally to do business in any jurisdiction where
they are not then so qualified or to take any action which would subject them to
general service of process or to taxation in any such jurisdiction where they
are not then so subject.

          (d) The Company and the Note Guarantors represent and agree that the
Market-Making Registration Statement, any post-effective amendments thereto, any
amendments or supplements to the related prospectus and any documents filed by
them under the Exchange Act will, when they become effective or are filed with
the Commission, as the case may be, conform in all respects to the requirements
of the Securities Act and the Exchange Act and the rules and regulations of the
Commission thereunder and will not, as of the effective date of such
Market-Making Registration Statement or post-effective amendments and as of the
filing date of amendments or supplements to such prospectus or filings under the
Exchange Act, contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; PROVIDED that no representation or warranty is made as to
information contained in or omitted from the Market-Making Registration
Statement or the related prospectus in reliance upon and in conformity with
written information furnished to the Company by the Market-Maker specifically
for inclusion therein, which information the parties hereto agree will be
limited to the statements concerning the market-making activities of the
Market-Maker to be set forth on the cover page and in the "Plan of distribution"
section of the prospectus (the "Market-Maker's Information").

          (e) At the time of effectiveness of the Market-Making Registration
Statement and concurrently with each time the Market-Making Registration
Statement or the related prospectus shall be amended or such prospectus shall be
supplemented, the Company shall (if requested by the Market-Maker) furnish the
Market-Maker and its counsel with a certificate of its Chairman of the Board of
Directors or its President and Chief Financial Officer to the effect that:

          (i) the Market-Making Registration Statement has been declared
     effective; (ii) in the case of an amendment to the Market-Making
     Registration Statement, such amendment has become effective under the
     Securities Act as of the date and time specified in such certificate, if
     applicable; and in the case of an amendment or supplement to the related
     prospectus, such amendment or supplement to the prospectus was filed with
     the Commission pursuant to the subparagraph of Rule 424(b) under the
     Securities Act specified in such certificate on the date specified therein;
     (iii) to the



                                                                              16

     knowledge of such officers, no stop order suspending the effectiveness of
     the Market-Making Registration Statement has been issued and no proceeding
     for that purpose is pending or threatened by the Commission; (iv) such
     officers have carefully examined the Market-Making Registration Statement
     and the prospectus (and, in the case of an amendment or supplement, such
     amendment or supplement) and as of the date of such Market-Making
     Registration Statement, amendment or supplement, as applicable, the
     Market-Making Registration Statement and the prospectus, as amended or
     supplemented, if applicable, did not include any untrue statement of a
     material fact and did not omit to state a material fact required to be
     stated therein or necessary to make the statements therein not misleading.

          (f) At the time of effectiveness of the Market-Making Registration
Statement and concurrently with each time the Market-Making Registration
Statement or the related prospectus shall be amended or such prospectus shall be
supplemented, the Company shall (if requested by the Market-Maker) furnish the
Market-Maker and its counsel with the written opinion of counsel for the Company
satisfactory to the Market-Maker to the effect that:

          (i) the Market-Making Registration Statement has been declared
     effective; (ii) in the case of an amendment to the Market-Making
     Registration Statement, such amendment has become effective under the
     Securities Act as of the date and time specified in such opinion, if
     applicable; and in the case of an amendment or supplement to the related
     prospectus, such amendment or supplement to the prospectus was filed with
     the Commission pursuant to the subparagraph of Rule 424(b) under the
     Securities Act specified in such opinion on the date specified therein;
     (iii) to the knowledge of such counsel, no stop order suspending the
     effectiveness of the Market-Making Registration Statement has been issued
     and no proceeding for that purpose is pending or threatened by the
     Commission; and (iv) such counsel has reviewed the Market-Making
     Registration Statement and the prospectus (and, in the case of an amendment
     or supplement, such amendment or supplement) and participated with officers
     of the Company and independent public accountants for the Company in the
     preparation of such Market-Making Registration Statement and prospectus
     (and, in the case of an amendment or supplement, such amendment or
     supplement) and has no reason to believe that (except for the financial
     statements and other financial and statistical data contained therein as to
     which such counsel need express no belief) as of the date of such
     Market-Making Registration Statement, amendment or supplement, as
     applicable, the Market-Making Registration Statement and the prospectus, as
     amended or supplemented, if applicable, contained any untrue statement of a
     material fact or omitted to state a material fact required to be stated
     therein or necessary to make the statements therein not misleading.

          (g) At the time of effectiveness of the Market-Making Registration
Statement and concurrently with each time the Market-Making Registration
Statement or the related prospectus shall be amended or such prospectus shall be
supplemented to include audited annual financial information, the Company shall
(if requested by the Market-Maker) furnish the Market-Maker and its counsel with
a letter of Ernst & Young LLP (or other independent public accountants for the
Company or the Note Guarantors of nationally recognized standing) in form
satisfactory to the Market-Maker, addressed to the Market-Maker and dated the
date of delivery of such letter, (i) confirming that they are independent public
accountants within the meaning of the Securities Act and are in compliance with
the applicable requirements relating to the qualification of accountants under
Rule 2-01 of Regulation S-X of the Commission and, (ii) in all



                                                                              17

other respects, substantially in the form of the letter delivered to the
Solicitation Agent pursuant to Section 5(g) of the Solicitation Agent Agreement,
with, in the case of an amendment or supplement that includes audited financial
information, such changes as may be necessary to reflect the amended or
supplemented financial information.

          (h) The Company and the Note Guarantors, on the one hand, and the
Market-Maker, on the other hand, hereby agree to indemnify each other, and, if
applicable, contribute to the other, in accordance with Sections 7 and 8 of this
Agreement.

          (i) The Company will comply with the provisions of this Section 6 at
its own expense and will reimburse the Market-Maker for its expenses associated
with this Section 6 (including reasonable fees of counsel for the Market-Maker).

          (j) The agreements contained in this Section 6 and the
representations, warranties and agreements contained in this Agreement shall
survive all offers and sales of the Consenting Notes and Exchange Notes and
shall remain in full force and effect, regardless of any termination or
cancelation of this Agreement or any investigation made by or on behalf of any
indemnified party.

          (k) For purposes of this Section 6, (i) any reference to the terms
"amend", "amendment" or "supplement" with respect to the Market-Making
Registration Statement or the prospectus contained therein shall be deemed to
refer to and include the filing under the Exchange Act of any document deemed to
be incorporated therein by reference and (ii) any reference to the terms
"Consenting Notes", "Exchange Notes" or "Private Exchange Notes" shall be deemed
to refer to and include any securities issued in exchange for or with respect to
such Consenting Notes, Exchange Notes or Private Exchange Notes.

          7. INDEMNIFICATION. (a) In the event of a Shelf Registration Statement
or in connection with any prospectus delivery pursuant to an Exchange Offer
Registration Statement by an Exchanging Dealer, or in connection with the
Market-Making Registration Statement, the Company and the Note Guarantors shall
jointly and severally indemnify and hold harmless each Holder (including,
without limitation, the Solicitation Agent, the Market-Maker or such Exchanging
Dealer), its affiliates, its respective officers, directors, employees,
representatives and agents, and each person, if any, who controls such Holder
within the meaning of the Securities Act or the Exchange Act (collectively
referred to for purposes of this Section 7 and Section 8 as a Holder) from and
against any loss, claim, damage or liability, joint or several, or any action in
respect thereof (including, without limitation, any loss, claim, damage,
liability or action relating to purchases and sales of Consenting Notes,
Exchange Notes or Private Exchange Notes), to which that Holder may become
subject, whether commenced or threatened, under the Securities Act, the Exchange
Act, any other federal or state statutory law or regulation, at common law or
otherwise, insofar as such loss, claim, damage, liability or action arises out
of, or is based upon, (i) any untrue statement or alleged untrue statement of a
material fact contained in any such Registration Statement or Market-Making
Registration Statement or any prospectus forming part thereof or in any
amendment or supplement thereto, (ii) the omission or alleged omission to state
therein a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading or (iii) in the case of the Market-Maker, any material
breach by the Company of the representations, warranties and agreements
contained in Section 6, and shall reimburse each Holder promptly upon demand for
any legal or other expenses reasonably incurred by that Holder in connection



                                                                              18

with investigating or defending or preparing to defend against or appearing as a
third party witness in connection with any such loss, claim, damage, liability
or action as such expenses are incurred; PROVIDED, HOWEVER, that the Company and
the Note Guarantors shall not be liable in any such case to the extent that any
such loss, claim, damage, liability or action arises out of, or is based upon,
an untrue statement or alleged untrue statement in or omission or alleged
omission from any of such documents in reliance upon and in conformity with any
Holders' Information or Market-Maker's Information, respectively; and PROVIDED,
FURTHER, that with respect to any such untrue statement in or omission from any
related preliminary prospectus, the indemnity agreement contained in this
Section 7(a) shall not inure to the benefit of any Holder from whom the person
asserting any such loss, claim, damage, liability or action received Consenting
Notes, Exchange Notes or Private Exchange Notes to the extent that such loss,
claim, damage, liability or action of or with respect to such Holder results
from the fact that both (A) a copy of the final prospectus was not sent or given
to such person at or prior to the written confirmation of the sale of such
Consenting Notes, Exchange Notes or Private Exchange Notes to such person and
(B) the untrue statement in or omission from the related preliminary prospectus
was corrected in the final prospectus unless, in either case, such failure to
deliver the final prospectus was a result of non-compliance by the Company with
Section 4(d), 4(e), 4(f), 4(g) or 6(a)(v), as applicable.

          (b) In (i) the event of a Shelf Registration Statement, each Holder or
(ii) connection with the Market-Making Registration Statement, the Market-Maker,
as applicable, shall indemnify and hold harmless the Company, its affiliates,
its respective officers, directors, employees, representatives and agents, and
each person, if any, who controls the Company within the meaning of the
Securities Act or the Exchange Act (collectively referred to for purposes of
this Section 7(b) and Section 8 as the Company), from and against any loss,
claim, damage or liability, joint or several, or any action in respect thereof,
to which the Company may become subject, whether commenced or threatened, under
the Securities Act, the Exchange Act, any other federal or state statutory law
or regulation, at common law or otherwise, insofar as such loss, claim, damage,
liability or action arises out of, or is based upon, (i) any untrue statement or
alleged untrue statement of a material fact contained in any such Registration
Statement or Market-Making Registration Statement, respectively, or any
prospectus forming part thereof or in any amendment or supplement thereto or
(ii) the omission or alleged omission to state therein a material fact required
to be stated therein or necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading, but
in each case only to the extent that the untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with any Holders' Information or Market-Maker's Information,
respectively, furnished to the Company by such Holder and shall reimburse the
Company for any legal or other expenses reasonably incurred by the Company in
connection with investigating or defending or preparing to defend against or
appearing as a third party witness in connection with any such loss, claim,
damage, liability or action as such expenses are incurred; PROVIDED, HOWEVER,
that no such Holder shall be liable for any indemnity claims hereunder in excess
of the amount of net proceeds received by such Holder from the sale of
Consenting Notes, Exchange Notes or Private Exchange Notes pursuant to such
Shelf Registration Statement, Market-Making Registration Statement or
prospectus.

          (c) Promptly after receipt by an indemnified party under this
Section 7 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party pursuant to Section 7(a) or 7(b), notify the indemnifying
party in writing of the claim or the commencement of that action; PROVIDED,
HOWEVER, that the failure to notify the indemnifying party shall not relieve it
from any liability



                                                                              19

which it may have under this Section 7 except to the extent that it has been
materially prejudiced (through the forfeiture of substantive rights or defenses)
by such failure; and PROVIDED, FURTHER, that the failure to notify the
indemnifying party shall not relieve it from any liability which it may have to
an indemnified party otherwise than under this Section 7. If any such claim or
action shall be brought against an indemnified party, and it shall notify the
indemnifying party thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 7 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than the reasonable costs of investigation; PROVIDED, HOWEVER,
that an indemnified party shall have the right to employ its own counsel in any
such action, but the fees, expenses and other charges of such counsel for the
indemnified party will be at the expense of such indemnified party unless (1)
the employment of counsel by the indemnified party has been authorized in
writing by the indemnifying party, (2) the indemnified party has reasonably
concluded (based upon advice of counsel to the indemnified party) that there may
be legal defenses available to it or other indemnified parties that are
different from or in addition to those available to the indemnifying party, (3)
a conflict or potential conflict exists (based upon advice of counsel to the
indemnified party) between the indemnified party and the indemnifying party (in
which case the indemnifying party will not have the right to direct the defense
of such action on behalf of the indemnified party) or (4) the indemnifying party
has not in fact employed counsel reasonably satisfactory to the indemnified
party to assume the defense of such action within a reasonable time after
receiving notice of the commencement of the action, in each of which cases the
reasonable fees, disbursements and other charges of counsel will be at the
expense of the indemnifying party or parties. It is understood that the
indemnifying party or parties shall not, in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the reasonable fees,
disbursements and other charges of more than one separate firm of attorneys (in
addition to any local counsel) at any one time for all such indemnified party or
parties. Each indemnified party, as a condition of the indemnity agreements
contained in Sections 7(a) and 7(b), shall use all reasonable efforts to
cooperate with the indemnifying party in the defense of any such action or
claim. No indemnifying party shall be liable for any settlement of any such
action effected without its written consent (which consent shall not be
unreasonably withheld), but if settled with its written consent or if there be a
final judgment for the plaintiff in any such action, the indemnifying party
agrees to indemnify and hold harmless any indemnified party from and against any
loss or liability by reason of such settlement or judgment. No indemnifying
party shall, without the prior written consent of the indemnified party (which
consent shall not be unreasonably withheld), effect any settlement of any
pending or threatened proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such proceeding.

          8. CONTRIBUTION. If the indemnification provided for in Section 7 is
unavailable or insufficient to hold harmless an indemnified party under
Section 7(a) or 7(b), then each indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid or payable by
such indemnified party as a result of such loss, claim, damage or liability, or
action in respect thereof, (a) in such proportion as shall be appropriate to
reflect the relative benefits received by the Company from the Consent
Solicitation and the issuance of the



                                                                              20

Consenting Notes, on the one hand, and by a Holder from receiving Consenting
Notes, Exchange Notes or Private Exchange Notes, as applicable, registered under
the Securities Act or, if applicable, by the Market Maker from the filing and
effectiveness of a Market Making Registration Statement on the other, or (b) if
the allocation provided by clause (a) above is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (a) above but also the relative fault of the Company and
the Note Guarantors, on the one hand, and such Holder, on the other, with
respect to the statements or omissions that resulted in such loss, claim, damage
or liability, or action in respect thereof, as well as any other relevant
equitable considerations. The relative fault shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to the Company and the Note Guarantors or information supplied by the
Company and the Note Guarantors, on the one hand, or to any Holders' Information
or Market-Maker's Information, respectively, supplied by such Holder, on the
other, the intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such untrue statement or
omission. The parties hereto agree that it would not be just and equitable if
contributions pursuant to this Section 8 were to be determined by PRO RATA
allocation or by any other method of allocation that does not take into account
the equitable considerations referred to herein. The amount paid or payable by
an indemnified party as a result of the loss, claim, damage or liability, or
action in respect thereof, referred to above in this Section 8 shall be deemed
to include, for purposes of this Section 8, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending or preparing to defend any such action or claim. Notwithstanding
the provisions of this Section 8, an indemnifying party that is a Holder of
Consenting Notes, Exchange Notes or Private Exchange Notes or the Market-Maker
shall not be required to contribute any amount in excess of the amount by which
the total price at which the Consenting Notes, Exchange Notes or Private
Exchange Notes sold by such indemnifying party to any purchaser exceeds the
amount of any damages which such indemnifying party has otherwise paid or become
liable to pay by reason of any untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.

          9. RULES 144 AND 144A. The Company and the Note Guarantors shall use
commercially reasonable efforts to file the reports required to be filed by them
under the Securities Act and the Exchange Act in a timely manner and, if at any
time the Company and the Note Guarantors are not required to file such reports,
they will, upon the written request of any Holder of Transfer Restricted Notes
or the Market-Maker, make publicly available other information so long as
necessary to permit sales of such Holder's or the Market-Maker's securities
pursuant to Rules 144 and 144A. The Company and the Note Guarantors covenant
that they will take such further action as any Holder of Transfer Restricted
Notes or the Market-Maker may reasonably request, all to the extent required
from time to time to enable such Holder or the Market-Maker to sell Transfer
Restricted Notes without registration under the Securities Act within the
limitation of the exemptions provided by Rules 144 and 144A (including, without
limitation, the requirements of Rule 144A(d)(4)). Upon the written request of
any Holder of Transfer Restricted Notes, the Company and the Note Guarantors
shall deliver to such Holder or the Market-Maker a written statement as to
whether they have complied with such requirements. Notwithstanding the
foregoing, nothing in this Section 9 shall be deemed to require the Company to
register any of its securities pursuant to the Exchange Act.



                                                                              21

          10. UNDERWRITTEN REGISTRATIONS. If any of the Transfer Restricted
Notes covered by any Shelf Registration Statement are to be sold in an
underwritten offering, the investment banker or investment bankers and manager
or managers that will administer the offering will be selected by the Holders of
a majority in aggregate principal amount at maturity of such Transfer Restricted
Notes included in such offering, subject to the consent of the Company and the
Note Guarantors (which shall not be unreasonably withheld or delayed), and such
Holders shall be responsible for all underwriting commissions and discounts in
connection therewith.

          No person may participate in any underwritten registration hereunder
unless such person (i) agrees to sell such person's Transfer Restricted Notes on
the basis reasonably provided in any underwriting arrangements approved by the
persons entitled hereunder to approve such arrangements and (ii) completes and
executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents reasonably required under the terms of such
underwriting arrangements.

          11. MISCELLANEOUS. (a) AMENDMENTS AND WAIVERS. The provisions of this
Agreement may not be amended, modified or supplemented, and waivers or consents
to departures from the provisions hereof may not be given, unless the Company
has obtained the written consent of Holders of a majority in aggregate principal
amount of the Consenting Notes, the Exchange Notes and the Private Exchange
Notes, taken as a single class (and, with respect to the provisions of
Section 6, the written consent of the Market-Maker). Notwithstanding the
foregoing, a waiver or consent to depart from the provisions hereof with respect
to a matter that relates exclusively to the rights of Holders whose Consenting
Notes, Exchange Notes or Private Exchange Notes are being sold pursuant to a
Registration Statement and that does not directly or indirectly affect the
rights of other Holders may be given by Holders of a majority in aggregate
principal amount of the Consenting Notes, the Exchange Notes and the Private
Exchange Notes being sold by such Holders pursuant to such Registration
Statement whose rights are so affected.

          (b) NOTICES. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class mail,
telecopier or air courier guaranteeing next-day delivery:

          (1) if to a Holder, at the most current address given by such Holder
     to the Company in accordance with the provisions of this Section 11(b),
     which address initially is, with respect to each Holder, the address of
     such Holder maintained by the registrar under the Indenture, with a copy in
     like manner to JPMorgan;

          (2) if to the Solicitation Agent or the Market-Maker, initially
     pursuant to Section 9 of the Solicitation Agent Agreement; and

          (3) if to the Company or the Note Guarantors, initially at the address
     of the Company set forth in the Solicitation Agent Agreement.

          All such notices and communications shall be deemed to have been duly
given: when delivered by hand, if personally delivered; one business day after
being delivered to a next-day air courier; five business days after being
deposited in the mail; and when receipt is acknowledged by the recipient's
telecopier machine, if sent by telecopier.



                                                                              22

          The Company and the Note Guarantors or the Solicitation Agent may, by
written notice to the other, designate additional or different addresses for
subsequent notices or communications.

          (c) SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the
Company and its successors and assigns.

          (d) COUNTERPARTS. This Agreement may be executed in any number of
counterparts (which may be delivered in original form or by telecopier) and by
the parties hereto in separate counterparts, each of which when so executed
shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.

          (e) DEFINITION OF TERMS. For purposes of this Agreement, (a) the term
"business day" means any day on which the New York Stock Exchange, Inc. is open
for trading, (b) the term "subsidiary" has the meaning set forth in Rule 405
under the Securities Act and (c) except where otherwise expressly provided, the
term "affiliate" has the meaning set forth in Rule 405 under the Securities Act.

          (f) HEADINGS. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.

          (g) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

          (h) REMEDIES. In the event of a breach by the Company, the Note
Guarantors or by any Holder of any of their obligations under this Agreement,
each Holder, the Company or the Note Guarantors, as the case may be, in addition
to being entitled to exercise all rights granted by law, including recovery of
damages (other than the recovery of damages for a breach by the Company or the
Note Guarantors of their obligations under Sections 1 or 2 hereof for which
liquidated damages have been paid pursuant to Section 3 hereof), will be
entitled to specific performance of its rights under this Agreement. The
Company, the Note Guarantors and each Holder agree that monetary damages would
not be adequate compensation for any loss incurred by reason of a breach by each
such person of any of the provisions of this Agreement and hereby further agree
that, in the event of any action for specific performance in respect of such
breach, each such person shall waive the defense that a remedy at law would be
adequate.

          (i) NO INCONSISTENT AGREEMENTS. Each of the Company and the Note
Guarantors represents, warrants and agrees with the Solicitation Agent that (i)
it has not entered into, and shall not, on or after the date of this Agreement,
enter into any agreement that is inconsistent with the rights granted to the
Holders in this Agreement or otherwise conflicts with the provisions hereof,
(ii) it has not previously entered into any agreement which remains in effect
granting any registration rights with respect to any of its debt securities to
any person and (iii) (with respect to the Company) without limiting the
generality of the foregoing, without the written consent of the Holders of a
majority in aggregate principal amount at maturity of the then outstanding
Transfer Restricted Notes and the Market-Maker, it shall not grant to any person
the right to request the Company to register any debt securities of the Company
under the Securities Act unless the rights so granted are not in conflict or
inconsistent with the provisions of this Agreement.



                                                                              23

          (j) NO PIGGYBACK ON REGISTRATIONS. Neither the Company nor any of its
security holders (other than the Holders of Transfer Restricted Notes in such
capacity) shall have the right to include any securities of the Company in any
Shelf Registration or Registered Exchange Offer other than Transfer Restricted
Notes.

          (k) SEVERABILITY. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use commercially reasonable efforts to find and employ an
alternative means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction. It is hereby
stipulated and declared to be the intention of the parties that they would have
executed the remaining terms, provisions, covenants and restrictions without
including any of such that may be hereafter declared invalid, illegal, void or
unenforceable.



                                                                              24

          Please confirm that the foregoing correctly sets forth the agreement
among the Company, the Note Guarantors and the Solicitation Agent.

                                         Very truly yours,

                                         PLIANT CORPORATION,


                                         by
                                           -------------------------------------
                                           Name:
                                           Title:


                                         PLIANT CORPORATION INTERNATIONAL,
                                         PLIANT FILM PRODUCTS OF MEXICO, INC.,
                                         PLIANT PACKAGING OF CANADA, LLC,
                                         UNIPLAST HOLDINGS INC.,
                                         UNIPLAST U.S., INC.,
                                         UNIPLAST INDUSTRIES CO.,


                                         by
                                           -------------------------------------
                                           Name:
                                           Title:



                                                                              25

Confirmed and accepted as of the date first written above.

J.P. MORGAN SECURITIES INC.,


by
  -------------------------------------
  Name:
  Title:



                                                                         ANNEX A

          Each broker-dealer that receives Exchange Notes for its own account
pursuant to the Registered Exchange Offer must acknowledge that it will deliver
a prospectus in connection with any resale of such Exchange Notes. The Letter of
Transmittal states that by so acknowledging and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it is an "underwriter" within the
meaning of the Securities Act. This Prospectus, as it may be amended or
supplemented from time to time, may be used by a broker-dealer in connection
with resales of Exchange Notes received in exchange for Consenting Notes where
such Consenting Notes were acquired by such broker-dealer as a result of
market-making activities or other trading activities. The Company has agreed
that, for a period of 180 days after the Expiration Date (as defined herein), it
will make this Prospectus available to any broker-dealer for use in connection
with any such resale. See "Plan of Distribution".



                                                                         ANNEX B

          Each broker-dealer that receives Exchange Notes for its own account in
exchange for Consenting Notes, where such Consenting Notes were acquired by such
broker-dealer as a result of market-making activities or other trading
activities, must acknowledge that it will deliver a prospectus in connection
with any resale of such Exchange Notes. See "Plan of distribution".



                                                                         ANNEX C

                              PLAN OF DISTRIBUTION

          Each broker-dealer that receives Exchange Notes for its own account
pursuant to the Registered Exchange Offer must acknowledge that it will deliver
a prospectus in connection with any resale of such Exchange Notes. This
Prospectus, as it may be amended or supplemented from time to time, may be used
by a broker-dealer in connection with resales of Exchange Notes received in
exchange for Consenting Notes where such Consenting Notes were acquired as a
result of market-making activities or other trading activities. The Company has
agreed that, for a period of 180 days after the Expiration Date, it will make
this prospectus, as amended or supplemented, available to any broker-dealer for
use in connection with any such resale.

          The Company will not receive any proceeds from any sale of Exchange
Notes by broker-dealers. Exchange Notes received by broker-dealers for their own
account pursuant to the Registered Exchange Offer may be sold from time to time
in one or more transactions in the over-the-counter market, in negotiated
transactions, through the writing of options on the Exchange Notes or a
combination of such methods of resale, at market prices prevailing at the time
of resale, at prices related to such prevailing market prices or at negotiated
prices. Any such resale may be made directly to purchasers or to or through
brokers or dealers who may receive compensation in the form of commissions or
concessions from any such broker-dealer or the purchasers of any such Exchange
Notes. Any broker-dealer that resells Exchange Notes that were received by it
for its own account pursuant to the Registered Exchange Offer and any broker or
dealer that participates in a distribution of such Exchange Notes may be deemed
to be an "underwriter" within the meaning of the Securities Act and any profit
on any such resale of Exchange Notes and any commission or concessions received
by any such persons may be deemed to be underwriting compensation under the
Securities Act. The Letter of Transmittal states that, by acknowledging that it
will deliver and by delivering a prospectus, a broker-dealer will not be deemed
to admit that it is an "underwriter" within the meaning of the Securities Act.

          For a period of 180 days after the Expiration Date the Company will
promptly send additional copies of this Prospectus and any amendment or
supplement to this Prospectus to any broker-dealer that requests such documents
in the Letter of Transmittal. The Company has agreed to pay all expenses
incident to the Registered Exchange Offer (including the expenses of one counsel
for the Holders of the Consenting Notes) other than commissions or concessions
of any broker-dealers and will indemnify the Holders of the Consenting Notes
(including any broker-dealers) against certain liabilities, including
liabilities under the Securities Act.



                                                                         ANNEX D

               / /  CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10
                    ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY
                    AMENDMENTS OR SUPPLEMENTS THERETO.

               Name:
               Address:

If the undersigned is not a broker-dealer, the undersigned represents that it is
not engaged in, and does not intend to engage in, a distribution of Exchange
Notes. If the undersigned is a broker-dealer that will receive Exchange Notes
for its own account in exchange for Consenting Notes that were acquired as a
result of market-making activities or other trading activities, it acknowledges
that it will deliver a prospectus in connection with any resale of such Exchange
Notes; however, by so acknowledging and by delivering a prospectus, the
undersigned will not be deemed to admit that it is an "underwriter" within the
meaning of the Securities Act.

EX-23.3

                                                                    Exhibit 23.3

           Consent of Independent Registered Public Accounting Firm

We consent to the reference to our firm under the caption "Experts" and to
the use of our report dated March 23, 2005 included in Amendment No. 2 to the
Registration Statement (Form S-4 No. 333-114608) and related Prospectus of
Pliant Corporation for the registration of $7,800,000 principal amount at
maturity of the Company's 11 1/8% Senior Secured Discount Notes due 2009.

/s/ Ernst & Young LLP
Chicago, Illinois
June 13, 2005

EX-24.1

                                                                    EXHIBIT 24.1

                                POWER OF ATTORNEY

         Each person whose signature appears below constitutes and appoints
Joseph J. Kwederis his true and lawful attorney-in-fact and agent, each acting
alone, with full power of substitution and resubstitution, for him and in his
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to any registration statement, and to sign
any registration statement for the same offering covered by any registration
statement that is to be effective upon filing pursuant to Rule 462(b) under the
Securities Act of 1933, as amended, and all post-effective amendments thereto,
and to file the same, with all exhibits thereto, and all documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, full power and authority to do and perform each
and every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, each acting alone, or his substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.




      Signature                        Name and Capacity                          Date
      ---------                        -----------------                          ----

                                                                         
/s/ JOHN D. BOWLIN             John D. Bowlin,
_______________________        Director of Pliant Corporation                 June 14, 2005

/s/ RICHARD P. DURHAM          Richard P. Durham,
_______________________        Director of Pliant Corporation                 June 14, 2005

/s/ SEAN EPPS                  Sean Epps,
_______________________        Director of Pliant Corporation                 June 14, 2005

/s/ EDWARD A. LAPEKAS          Edward A. Lapekas,
_______________________        Director of Pliant Corporation                 June 14, 2005

/s/ ALBERT MACMILLAN           Albert MacMillan,
_______________________        Director of Pliant Corporation                 June 14, 2005

/s/ JEFFREY C. WALKER          Jeffrey C. Walker,
_______________________        Director of Pliant Corporation                 June 14, 2005

/s/ TIMOTHY J. WALSH           Timothy J. Walsh,
_______________________        Director of Pliant Corporation                 June 14, 2005

/s/ JAMES HARDER               James Harder,
_______________________        President and Director of                      June 14, 2005
                               Pliant Solutions Corporation

/s/ DAVID L. KING              David L. King,
_______________________        Director of Uniplast Holdings, Inc. and        June 14, 2005
                               Uniplast Industries, Co.