Pactiv Corporation

We have completed remediation and testing on the vast majority of our mission critical systems and devices and Y2K work is substantially complete at all of our Manufacturing facilities as of October 1, 1999. Contingency plans and year end rollover procedures are being developed and are designed to address any unanticipated problems created by internal or external factors and to insure a smooth year 2000 transition. These activities are fluid in nature and will continue to evolve through the end of the year. We do not anticipate any disruption of business services relating to internal Year 2000 issues.

In providing this update we wish to note that we are not providing any representation, warranty, certification, guaranty or other assurances that we are or will be Year 2000 "compliant" or that Year 2000 issues will not impact our business in some way. As you may know, the United States Security and Exchange Commission has noted that "it is not, and will not, be possible for a single entity or collective enterprise to represent that it has achieved complete Year 2000 compliance and thus to guarantee its remediation effects." However Pactiv will certify that we have carried out due diligence in our Y2K program and the attached pages provide more details about our program.

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1. PACTIV’S YEAR 2000 PROGRAM

Has Pactiv established a formal program for monitoring and measuring Year 2000 readiness, and, if so, what areas does the program cover?

Response:

Pactiv has created a global team of key information technology and manufacturing managers and other business leaders to address and coordinate our Year 2000 Program initiatives. An Executive Director of the Year 2000 Program Office has been appointed to coordinate Pactiv’s Year 2000 projects. These projects include:

inventorying business applications, technical infrastructure, date sensitive manufacturing, warehousing, services equipment and environmental operations, end-user computing, research & development and test facilities and Pactiv products;

soliciting similar information from suppliers, agents, service providers and others;

planning for and undertaking remediation and/or replacement of, or alternative procedures for, such applications, systems, equipment, operations and products that are not Year 2000 ready; and

testing remediated and replaced applications, systems, equipment, operations and products to verify Year 2000 readiness.

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2. BUSINESS APPLICATIONS

With regard to business applications (e.g., applications relating to product design, material planning, production scheduling, marketing, sales and accounting, customer order processing and purchasing and personnel), including all vendor supplied or custom developed applications supported by Pactiv’s information technology group:

a. When will software and interface inventories be completed?

b. When will the remediation and/or replacement of the business applications be completed?

c. When will acceptance testing for remediated or replaced business applications and systems be completed?

Response:

a. Pactiv has substantially completed inventorying all critical software and interfaces for business applications.

b. Pactiv has substantially completed remediation or replacement of its mission critical business applications. Most of this work was finished in July of 1999.

c. Pactiv has substantially completed acceptance testing for remediated and replaced applications and systems. A substantial amount of acceptance testing was completed prior to July of 1999 and mission critical systems were put through additional testing in August of 1999.

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3. TECHNICAL INFRASTRUCTURE

With regard to technical infrastructure, including the hardware, complete systems and equipment related to the technical infrastructure of Pactiv, such as data center hardware and software, database software, disaster recovery facilities, networks, servers and desktop machines, e-mail, telephones and video, and all end user desktop software such as MS Office:

a. When will technical infrastructure inventories be completed?

b. When will the remediation, replacement and/or alternative procedures be completed?

c. When will acceptance testing for remediated or replaced technical infrastructure equipment or for alternative procedures be completed?

Response:

a. Technical infrastructure inventories are substantially completed. However, Pactiv plans to update this inventory process for new components added to the technical infrastructure as many components are rapidly changing or being replaced. Part of this ongoing process is to require Year 2000 certification and/or warranties from the providers of all such replaced components.

b. Pactiv has substantially completed the remediation, replacement and/or alternative procedures for mission critical technical infrastructure as of September 1, 1999.

c. Pactiv has also completed acceptance testing for remediated and/or replaced technical infrastructure equipment, as well as for alternative procedures, as of September 1, 1999.

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4. MANUFACTURING, WAREHOUSING AND SERVICES EQUIPMENT AND ENVIRONMENTAL OPERATIONS

In this era of highly automated manufacturing, material storage and distribution, servicing and environmental operations, a failure or error in one or more of these areas can interrupt a core business. Although many operations are not themselves date dependent, they may be providing date based feeds to other processes, or functioning on machines that are date dependent. Therefore, with regard to manufacturing, warehousing, services equipment and environmental operations:

a. When will hardware, software, data and interface inventories be completed?

b. When will the remediation, replacement and/or alternative procedures be completed?

c. When will acceptance testing for remediated or replaced equipment or for alternative procedures be completed?

Response:

a. Pactiv has substantially completed its hardware, software, data and interface inventories.

b. Pactiv has substantially completed the remediation, replacement and/or alternative procedures for manufacturing equipment as of September 1, 1999.

c. Pactiv has completed acceptance testing for remediated and/or replaced equipment, as well as alternative procedures, as of September 1, 1999.

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5. END-USER COMPUTING

With regard to end-user computing, pursuant to which individuals expedite the development of applications and the processing of programs, by using among other things user written reports, spreadsheets, macro applications and databases:

a. When will reports, spreadsheets, macro applications and database inventories be completed?

b. When will the remediation and/or replacement of reports, spreadsheets, macro applications and databases be completed?

c. When will acceptance testing for remediated or replaced reports, spreadsheets, macro applications and databases be completed?

Response:

a. Pactiv has substantially completed its business critical reports, spreadsheets, macro applications and database inventories.

b. Pactiv has substantially completed remediation and replacement of reports, macro applications and databases as of July 1, 1999.

c. Pactiv has substantially completed acceptance testing for remediated and/or replaced business critical reports, spreadsheets, macro applications and as of July 30, 1999.

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6. RESEARCH & DEVELOPMENT AND TEST FACILITIES

With regard to Pactiv’s research & development and test facilities:

a. When will hardware, software, data and interface inventories be completed?

b. When will the remediation and/or replacement of the research & development and test facilities be completed?

c. When will acceptance testing for remediated or replaced research & development and test facilities be completed?

Response:

a. Pactiv has substantially completed its hardware, software, data and interface inventories.

b. Pactiv has substantially remediation or replacement of research & development and test facilities as of September 1, 1999.

c. Pactiv has substantially completed acceptance testing for remediated and/or replaced research & development and test facilities as of September 1, 1999.

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7. PRODUCTS

Pactiv’s products do not contain bios chips and are not date sensitive. Therefore, Pactiv’s products will not be affected by the advent of the Year 2000. Pactiv is identifying date stamping and bar-coding equipment that is used on or in connection with its products as part of its manufacturing, warehousing services equipment and environmental operations initiatives.
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8. SUPPLIERS, AGENTS, SERVICE PROVIDERS AND OTHERS

With regard to suppliers, agents and service provider and other third party interfaces:

a. When will canvassing of these entities regarding Year 2000 compliance be completed?

b. When will the remediation and/or replacement of the supplies and services by these entities be completed?

Response:

On an ongoing basis, Pactiv is contacting material suppliers, agents, service providers and others and assessing their Year 2000 readiness. Pactiv has followed up with critical vendors with a more in depth assessment in order to determine Pactiv’s risk. Pactiv plans to develop work arounds and contingency plans for those vendors whose Year 2000 problems pose major risks. While Pactiv is taking all reasonable care to have its critical suppliers, agents and service providers be Year 2000 ready, certain factors related to these entities, including the Year 2000 readiness of their own suppliers, agents, service providers and others, limit Pactiv’s ability to ensure such readiness.

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Year 2000 Definitions

Year 2000 ready means that the applicable software program, equipment, system or service when used in accordance with its associated documentation is Year 2000 compliant, or is not Year 2000 compliant but will process date/time data accurately with the implementation of a tested procedure, or is not Year 2000 compliant but will not cause any processing problem.

Year 2000 compliant means that the applicable software program, equipment, system or service when used in accordance with its associated documentation will accurately process date/time data (including, but not limited to, calculating, comparing and sequencing) such that: no value for a date prior to year 2028 will cause any interruption in processing; date-based functionality operates consistently for dates prior to, during and after year 2000; in all interfaces and data storage, the century in any date is specified either explicitly or by algorithms or inferencing rules; and leap years will be accurately recognized and processed.