<SUBMISSION>
<ACCESSION-NUMBER>0001047469-03-007870
<TYPE>8-A12G
<PUBLIC-DOCUMENT-COUNT>6
<FILING-DATE>20030306
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>POLYMER GROUP INC
<CIK>0000927417
<ASSIGNED-SIC>2221
<IRS-NUMBER>571003983
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>0103
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>8-A12G
<ACT>34
<FILE-NUMBER>000-50198
<FILM-NUMBER>03594209
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>4838 JENKINS AVE
<CITY>NORTH CHARLESTON
<STATE>SC
<ZIP>29405
<PHONE>8037445174
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>4838 JENKINS AVENUE
<CITY>NORTH CHARLESTON
<STATE>SC
<ZIP>29405
</MAIL-ADDRESS>
</FILER>
<DOCUMENT>
<TYPE>8-A12G
<SEQUENCE>1
<FILENAME>a2104906z8-a12g.htm
<DESCRIPTION>FORM 8-A12G
<TEXT>
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<P ALIGN="CENTER"><FONT SIZE=5><B>SECURITIES AND EXCHANGE COMMISSION<BR>  </B></FONT><FONT SIZE=2><B>WASHINGTON, DC 20549  </B></FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=5><B>FORM 8-A  </B></FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=3><B>For Registration of Certain Classes of Securities<BR>
Pursuant to Section 12(b) or 12(g) of the<BR>
Securities Exchange Act  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=5><B>POLYMER GROUP, INC.<BR>  </B></FONT><FONT SIZE=2>(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) </FONT></P>

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<TD WIDTH="49%" ALIGN="CENTER"><FONT SIZE=2><B>Delaware<BR> </B></FONT><FONT SIZE=2>(State or other jurisdiction of incorporation)</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%" ALIGN="CENTER"><FONT SIZE=2><B>57-1003983<BR> </B></FONT><FONT SIZE=2>(IRS Employer Identification No.)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%" ALIGN="CENTER"><BR><FONT SIZE=2><B>4838 Jenkins Avenue, North Charleston, SC<BR> </B></FONT><FONT SIZE=2>(Adress of principal executive offices)</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%" ALIGN="CENTER"><BR><FONT SIZE=2><B>29405<BR> </B></FONT><FONT SIZE=2>(Zip Code)</FONT></TD>
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<TD WIDTH="45%"><FONT SIZE=2>If this form relates to the registration of a class of securities pursuant to Section 12(b) of the Exchange Act and is effective pursuant to:<BR>
General Instruction A.(c), please check the following box.&nbsp;&nbsp;&nbsp;&nbsp;<FONT FACE="WINGDINGS">&#111;</FONT></FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="45%"><FONT SIZE=2>If this form relates to the registration of a class of securities pursuant to Section 12(g) of the Exchange Act and is effective pursuant to:<BR>
General Instruction A.(d), please check the following box&nbsp;&nbsp;&nbsp;&nbsp;<FONT FACE="WINGDINGS">&#253;</FONT></FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
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<P ALIGN="CENTER"><FONT SIZE=2>
Securities Act registration statement file number to which this form relates:&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT SIZE=2><B>N/A  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>Securities to be registered pursuant to Section 12(b) of the Act:&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT SIZE=2><B>None  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>Securities to be registered pursuant to Section 12(g) of the Act:&nbsp;&nbsp;&nbsp;&nbsp;</FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>Class A Common Stock, par value $0.01 per share<BR>  </B></FONT><FONT SIZE=2>(Title of Class) </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>Class B Common Stock, par value $0.01 per share<BR>  </B></FONT><FONT SIZE=2>(Title of Class) </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>Series A Warrants to subscribe for shares of Class D Common Stock, par value $0.01 per share<BR>  </B></FONT><FONT SIZE=2>(Title of Class) </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>Series B Warrants to subscribe for shares of Class E Common Stock, par value $0.01 per share<BR>  </B></FONT><FONT SIZE=2>(Title of Class) </FONT></P>

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<BR></FONT><FONT SIZE=2><B>INFORMATION REQUIRED IN<BR>  REGISTRATION STATEMENT    <BR>  </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This registration statement registers under Section 12(g) of the Securities Exchange Act of 1934 (the "Act") the following securities of Polymer Group, Inc. (the
"Company") being issued pursuant to the Company's Second Amended Modified Plan of Reorganization (the "Plan") and upon the filing with the State of Delaware of the Company's Amended and Restated
Certificate of Incorporation (the "Certificate"): </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Class
A Common Stock, par value $0.01 per share ("Class A Common");
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Class
B Common Stock, par value $0.01 per share ("Class B Common");
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Series
A Warrants to subscribe for shares of Class D Common Stock, par value $0.01 per share (the "Series A Warrants"); and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Series
B Warrants to subscribe for shares of Class E Common Stock, par value $0.01 per share (the "Series B Warrants" and together with the Series A
Warrants, the "Warrants"). </FONT></DD></DL>
</UL>

<P><FONT SIZE=2><A
NAME="de1872_item_1._description_of_registr__ite02458"> </A>
<A NAME="toc_de1872_2"> </A>
<BR></FONT><FONT SIZE=2><B>Item 1. Description of Registrant's Securities to be Registered.    <BR>  </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The description of the Company's securities that follows is qualified in its entirety by the full terms of each security, as set forth in the Exhibits to this
registration statement which are incorporated by reference in this Item&nbsp;1. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>Description of Class A Common and Class B Common  </B></FONT></P>

<P><FONT SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Voting.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Except as otherwise provided by the Delware General Corporation Law (the "DGCL") or the Certificate, each holder of
Class A Common and each holder of Class B Common has one vote for each share held on all matters submitted to a vote of the Company's shareholders. Neither Class A Common nor Class B Common has
cumulative voting rights. Generally, a majority of the votes cast at a meeting of shareholders by holders of shares entitled to vote on the proposal is required for shareholder action. </FONT></P>

<P><FONT SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dividends.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Except as otherwise provided by the DGCL or the Certificate, holders of Class A Common, holders of Class B Common
and holders of other classes of the Company's common stock entitled (pursuant to the Certificate) to participate in dividends and distributions share ratably in all dividends and distributions,
whether upon liquidation or dissolution or otherwise, made to the holders of the Company's common stock. </FONT></P>


<P><FONT SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Class A Common is not convertible into, or exchangeable for, any other class or series of the Company's capital
stock. Each share of Class B Common is convertible at any time into one share of Class A Common. Other than contractual preemptive rights set forth in the Shareholders Agreement, dated as of March 5,
2003, among the Company and certain of its shareholders, neither the holders of the Class A Common nor the Class B Common have preemptive or other rights to subscribe for or purchase additional
securities of the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
of the date of this registration statement, the Certificate contains no provisions modifying the voting or dividend rights of holders of either Class A Common or Class B Common
described above. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Neither
the shares of Class A Common nor the shares of Class B Common are subject to calls or assessments. No personal liability will attach to holders under the laws of the State of
Delaware (the Company's state of incorporation) or of the State of South Carolina (the state in which the Company's principal place of business is located). </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>2</FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><B>Description of the Series A Warrants  </B></FONT></P>

<P><FONT SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;General.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Each Series A Warrant entitles its holder to purchase one share of Class D Common Stock, par value $0.01 per share
(the "Class D Common"), at a price of $0.01 per share. The Series A Warrants are exercisable for an aggregate of 498,688 shares of Class D Common. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Capitalized
terms used but not otherwise defined in this description of the Series A Warrants are defined in Exhibit 4.1 to this Form 8-A. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
holder of a Series A Warrant may exercise, in whole or in part, the purchase rights represented by the Series A Warrants at any time and from time to time after the delivery by the
Company of a Class D Distribution Notice (as defined below) up to and including the Termination Date (as defined delow) (the "Exercise Period"). The purchase rights represented by the Series A
Warrants shall not be exercisable until the Company delivers a Class D Distribution Notice. The Company shall give the holders of the Series A Warrants written notice thirty (30) calendar days prior
to any Distribution or consummation of a Change in Control in which an outstanding share of Class D Common would be entitled to participate pursuant to the terms of the Company's Certificate (a "Class
D Distribution Notice"). The Series A Warrants, the purchase rights represented thereby, all of the Company's obligations thereunder and any other rights of the holders thereunder shall terminate upon
the earlier to occur of (i) the close of business on March 4, 2010, and (ii) the business day immediately preceding the consummation of a Change of Control (collectively, the "Termination Date"). </FONT></P>

<P><FONT SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Anti-dilution Provisions.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;If the Company, at any time after the issuance of the Series A Warrants, (A) pays a dividend or
makes a distribution on its Common Stock in shares of its capital stock (whether shares of Common Stock or of capital stock of any other class), (B) subdivides its outstanding shares of Common Stock
or (C) combines its outstanding shares of Common Stock into a smaller number of shares, the number of shares into which the Series A Warrants are exercisable immediately following such action will be
adjusted so that the holder of any Series A Warrant thereafter exercised will be entitled to receive the number of shares of Class D Common of the Company that represents the same percentage of the
outstanding Common Stock which such holder would have owned immediately prior to such action had such Series A Warrant been exercised immediately prior thereto and had such dividend, distribution,
subdivision, combination or reclassification been made on a pro rata share-for-share basis. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
case of any reclassification of outstanding shares of Class D Common issuable upon exercise of the Series A Warrants (other than as set forth in the immediately preceding paragraph
and other than a change in par value, or from par value to no par value, or from no par value to par value or as a result of a subdivision or combination), or in the case of any merger,
reorganization, restructuring, consolidation, share exchange, business combination, recapitalization or similar transaction involving the Company in which the Company is not the surviving or resulting
entity and which does not constitute a Change in Control, then the Company will make lawful and adequate provision whereby the holder of each Series A Warrant then outstanding will have the right
thereafter to receive on exercise of such Series A Warrant the kind and amount of shares of stock and other securities and property receivable upon such reclassification, merger, reorganization,
restructuring, consolidation, share exchange, business combination, recapitalization or similar transaction by a holder of the number of shares of Class D Common issuable upon exercise of such Series
A Warrant immediately prior to such reclassification,
merger, reorganization, restructuring, consolidation, share exchange business combination, recapitalization or similar transaction. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the event the Company, at any time or from time to time after the date of issuance of the Series A Warrants and prior to the Termination Date, issues, sells, distributes or otherwise
grants to all holders of Common Stock any rights to subscribe for or to purchase, or any warrants or options for the purchase of, Common Stock or any stock or securities convertible into or
exchangeable for Common Stock (any such rights, warrants or options being herein called "Section 2.3 Options" and any such </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>3</FONT></P>

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convertible or exchangeable stock or securities being herein called "Section 2.3 Convertible Securities"), whether or not such Section 2.3 Options or the rights to convert or exchange such Section
2.3 Convertible Securities are immediately exercisable, and the price per share at which Common Stock is issuable upon the exercise of such Section 2.3 Options or upon the conversion or exchange of
such Section 2.3 Convertible Securities is less than the Current Market Price per share of Common Stock on the record date for the issuance, sale, distribution or granting of such Section 2.3 Options
or Section 2.3 Convertible Securities (any such event being herein called a "Section 2.3 Triggering Derivative Issuance") then, effective upon such Section 2.3 Triggering Derivative Issuance, the
number of shares of Class D Common for which each Series A Warrant is exercisable will be adjusted to equal the product obtained by multiplying the number of shares of Class D Common for which each
Series A Warrant is exercisable immediately prior to such Section 2.3 Triggering Derivative Issuance by a fraction (A) the numerator of which is the number of shares of Common Stock outstanding
immediately after such Section 2.3 Triggering Derivative Issuance (calculated on a fully diluted basis, taking into account such Section 2.3 Triggering Derivative Issuance and assuming the exercise of
such Section 2.3 Options or Section 2.3 Convertible Securities, but excluding any adjustments to be made as a result thereof under the Series A Warrants, the Series B Warrants or the Convertible
Notes), and (B) the denominator of which is the sum of (1) the number of shares of Common Stock outstanding immediately prior to such Section 2.3 Triggering Derivative Issuance (calculated on a fully
diluted basis), and (2) the Section 2.3 Aggregate Issuance Price divided by the Current Market Price. No additional adjustment of the Exercise Price will be made upon the actual exercise of such
Section 2.3 Options or upon conversion or exchange of such Section 2.3 Convertible Securities or upon the conversion or exchange of the Section 2.3 Convertible Securities issuable upon the exercise of
rights, warrants or options, or the exercise of Section 2.3 Options issued upon the conversion or exchange of convertible or exchangeable securities. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the event the Company, at any time or from time to time after the date of issuance of the Series A Warrants and prior to the Termination Date, issues, sells, distributes or otherwise
grants in any manner to any but not all holders of the Common Stock any rights to subscribe for or to purchase, or any warrants or options for the purchase of, Common Stock or any stock or securities
convertible into or exchangeable for Common Stock (any such rights, warrants or options being herein called "Section 2.4 Options" and any such convertible or exchangeable stock or securities being
herein called "Section 2.4 Convertible Securities"), whether or not such Section 2.4 Options or the rights to convert or exchange such Section 2.4 Convertible Securities are immediately exercisable,
and the price per share at which Common Stock is issuable upon the exercise of such Section 2.4 Options or upon the conversion or exchange of such Section 2.4 Convertible Securities is less than 75%
of the Current Market Price per share of Common Stock on the record date for the issuance, sale, distribution or granting of such Section 2.4 Options or Section 2.4 Convertible Securities (any such
event being herein called a "Section 2.4 Triggering Derivative Issuance") then, effective upon such Section 2.4 Triggering Derivative Issuance, the number of shares of Class D Common for which each
Series A Warrant is exercisable
shall be adjusted to equal the product obtained by multiplying the number of shares of Class D Common for which each Series A Warrant is exercisable immediately prior to such Section 2.4 Triggering
Derivative Issuance by a fraction (A) the numerator of which is the number of shares of Common Stock outstanding immediately after such Section 2.4 Triggering Derivative Issuance (calculated on a
fully diluted basis, taking into account such Section 2.4 Triggering Derivative Issuance and assuming the exercise of such Section 2.4 Options or Section 2.4 Convertible Securities, but excluding any
adjustments to be made as a result thereof under the Series A Warrants, the Series B Warrants or the Convertible Notes), and (B) the denominator of which is the sum of (1) the number of shares of
Common Stock outstanding immediately prior to such Section 2.4 Triggering Derivative Issuance (calculated on a fully diluted basis), and (2) the Section 2.4 Aggregate Issuance Price divided by the
Current Market Price. No additional adjustment of the Exercise Price will be made upon the actual exercise of such Section 2.4 Options or upon conversion or exchange of such Section 2.4 </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>4</FONT></P>

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<P><FONT SIZE=2>
Convertible Securities or upon the conversion or exchange of the Section 2.4 Convertible Securities issuable upon the exercise of rights, warrants or options, or the exercise of Section 2.4 Options
issued upon the conversion or exchange of convertible or exchangeable securities. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
the Company pays a dividend or makes any other distribution payable in Section 2.3 Options, Section 2.4 Options, Section 2.3 Convertible Securities and Section 2.4 Convertible
Securities, then, for purposes of Sections 2.3 and 2.4 of the Series A Warrants, such Section 2.3 Options, Section 2.4 Options, Section 2.3 Convertible Securities or Section 2.4 Convertible Securities
shall be deemed to have been issued or sold without consideration. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
at any time the Company (except as hereinafter provided) issues or sells any additional shares of Common Stock in a transaction that was offered to all holders of Common Stock then
outstanding for consideration in an amount per additional share of Common Stock less than the Current Market Price, then the number of shares of Class D Common for which each Series A Warrant is
exercisable will be adjusted to equal the product obtained by multiplying the number of shares of Class D Common for which such Series A Warrant is exercisable immediately prior to such issue or sale
by a fraction (A) the numerator of which is the number of shares of Common Stock outstanding immediately after such issue or sale (calculated on a fully diluted basis, taking into account such issue
or sale, but excluding any adjustments to be made as a result thereof under the Sereis A Warrants, the Series B Warrants or the Convertible Notes), and (B) the denominator of which is the sum of (1)
the number of shares of Common Stock outstanding immediately prior to such issue or sale (calculated on a fully diluted basis), and (2) the aggregate consideration received from the issuance or sale
of the additional shares of Common Stock divided by the Current Market Price. Notwithstanding the foregoing, no adjustment will be made under this paragraph for issuances of shares of Common Stock (i)
upon exercise of the Series A Warrants, (ii) upon conversion of the outstanding Convertible Notes, (iii) upon exercise, conversion or exchange of any Section 2.3 Options, Section 2.4 Options, Section
2.3 Convertible Securities or Section 2.4 Convertible Securities, or (iv) in the event that the issuance of Common Stock giving rise to such adjustment is part of a transaction in which the holders of
the Series A Warrants are given the opportunity to purchase such shares of Common Stock at the same price per share as all other offerees in the offering and on a pro rata share-for-share basis with
all other offerees. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
at any time the Company (except as hereinafter provided) issues or sells any additional shares of Common Stock other than in a transaction that was offered to all holders of Common
Stock then
outstanding for consideration in an amount per additional share of Common Stock less than 75% of the Current Market Price, then the number of shares of Class D Common for which each Series A Warrant
is exercisable will be adjusted to equal the product obtained by multiplying the number of shares of Class D Common for which such Series A Warrant is exercisable immediately prior to such issue or
sale by a fraction (A) the numerator of which is the number of shares of Common Stock outstanding immediately after such issue or sale (calculated on a fully diluted basis, taking into account such
issue or sale, but excluding any adjustments to be made as a result thereof under the Series A Warrants, the Series B Warrants or the Convertible Notes), and (B) the denominator of which is the sum of
(1) the number of shares of Common Stock outstanding immediately prior to such issue or sale (calculated on a fully diluted basis), and (2) the aggregate consideration received from the issuance or
sale of the additional shares of Common Stock divided by the Current Market Price. Notwithstanding the foregoing, no adjustment will be made under this paragraph for issuances of shares of Common
Stock (i) upon exercise of the Series A Warrants, (ii) upon conversion of the Convertible Notes, (iii) upon exercise, conversion or exchange of any Section 2.3 Options, Section 2.4 Options, Section
2.3 Convertible Securities or Section 2.4 Convertible Securities, or (iv) in the event that the issuance of Common Stock giving rise to such adjustment is part of a transaction in which the holders of
the Series A Warrants are given the opportunity to purchase such shares of Common Stock at the same price per share as all other offerees in the offering and on a pro rata share-for-share basis with
all other offerees. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>5</FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><B>Description of the Series B Warrants  </B></FONT></P>


<P><FONT SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;General.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Each Series B Warrant entitles its holder to purchase one share of Class E Common Stock, par value $0.01 per share
(the "Class E Common"), at a price of $0.01 per share. The Series B Warrants are exercisable for an aggregate of 498,688 shares of Class E Common. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Capitalized
terms used but not otherwise defined in this description of the Series B Warrants are defined in Exhibit 4.2 to this Form 8-A. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
holder of a Series B Warrant may exercise, in whole or in part, the purchase rights represented by the Series B Warrants at any time and from time to time after the delivery by the
Company of a Class E Distribution Notice (as defined below) up to and including the Termination Date. The purchase rights represented by the Series B Warrants shall not be exercisable until the
Company delivers a Class E Distribution Notice. The Company shall give the holders of the Series B Warrants written notice thirty (30) calendar days prior to any Distribution or consummation of a
Change in Control in which an outstanding share of Class E Common would be entitled to participate pursuant to the terms of the Company's Certificate (a "Class E Distribution Notice"). The Series B
Warrants, the purchase rights represented thereby, all of the Company's obligations thereunder and any other rights of the holders thereunder shall terminate upon the Termination Date. </FONT></P>


<P><FONT SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Anti-dilution Provisions.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;If the Company, at any time after the issuance of the Series B Warrants, (A) pays a dividend or
makes a distribution on its Common Stock in shares of its capital stock (whether shares of Common Stock or of capital stock of any other class), (B) subdivides its outstanding shares of Common Stock
or (C) combines its outstanding shares of Common Stock into a smaller number of shares, the number of shares into which the Series B Warrants are exercisable immediately following such action will be
adjusted so that the holder of any Series B Warrant thereafter exercised will be entitled to receive the number of shares of Class E Common of the Company that represents the same percentage of the
outstanding Common Stock which such holder would have owned immediately prior to such action had such Series B Warrant been exercised immediately prior thereto and had such dividend, distribution,
subdivision, combination or reclassification been made on a pro rata share-for-share basis. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
case of any reclassification of outstanding shares of Class E Common issuable upon exercise of the Series B Warrants (other than as set forth in the immediately preceding paragraph
and other than a change in par value, or from par value to no par value, or from no par value to par value or as a result of a subdivision or combination), or in the case of any merger,
reorganization, restructuring, consolidation, share exchange, business combination, recapitalization or similar transaction involving the Company in which the Company is not the surviving or resulting
entity and which does not constitute a Change in Control, then the Company will make lawful and adequate provision whereby the holder of each Series B Warrant then outstanding will have the right
thereafter to receive on exercise of such Series B Warrant the kind and amount of shares of stock and other securities and property receivable upon such reclassification, merger, reorganization,
restructuring, consolidation, share exchange, business combination, recapitalization or similar transaction by a holder of the number of shares of Class E Common issuable upon exercise of such Series
B Warrant immediately prior to such reclassification, merger, reorganization, restructuring, consolidation, share exchange business combination, recapitalization or similar transaction. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the event the Company, at any time or from time to time after the date of issuance of the Series B Warrants and prior to the Termination Date, issues, sells, distributes or otherwise
grants to all holders of Common Stock any rights to subscribe for or to purchase, or any warrants or options for the purchase of, Common Stock or any stock or securities convertible into or
exchangeable for Common Stock (any such rights, warrants or options being herein called "Section 2.3 Options" and any such convertible or exchangeable stock or securities being herein called "Section
2.3 Convertible Securities"), whether or not such Section 2.3 Options or the rights to convert or exchange such Section 2.3 </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>6</FONT></P>

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<P><FONT SIZE=2>
Convertible Securities are immediately exercisable, and the price per share at which Common Stock is issuable upon the exercise of such Section 2.3 Options or upon the conversion or exchange of such
Section 2.3 Convertible Securities is less than the Current Market Price per share of Common Stock on the record date for the issuance, sale, distribution or granting of such Section 2.3 Options or
Section 2.3 Convertible Securities (any such event being herein called a "Section 2.3 Triggering Derivative Issuance") then, effective upon such Section 2.3 Triggering Derivative Issuance, the number
of shares of Class E Common for which each Series B Warrant is exercisable will be adjusted to equal the product obtained by multiplying the number of shares of Class E Common for which each Series B
Warrant is exercisable immediately prior to such Section 2.3 Triggering Derivative Issuance by a fraction (A) the numerator of which is the number of shares of Common Stock outstanding immediately
after such Section 2.3 Triggering Derivative Issuance (calculated on a fully diluted basis, taking into account such Section 2.3 Triggering Derivative Issuance and assuming the exercise of such
Section 2.3 Options or Section 2.3 Convertible Securities, but excluding any adjustments to be made as a result thereof under the Series B Warrants, the Series A Warrants or the Convertible Notes),
and (B) the denominator of which is the sum of (1) the number of shares of Common Stock outstanding immediately prior to such Section 2.3 Triggering Derivative Issuance (calculated on a fully diluted
basis), and (2) the Section 2.3 Aggregate Issuance Price divided by the Current Market Price. No additional adjustment of the Exercise Price will be made upon the actual exercise of such Section 2.3
Options or upon conversion or exchange of such Section 2.3 Convertible Securities or upon the conversion or exchange of the Section 2.3 Convertible Securities issuable upon the exercise of rights,
warrants or options, or the exercise of Section 2.3 Options issued upon the conversion or exchange of convertible or exchangeable securities. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the event the Company, at any time or from time to time after the date of issuance of the Series B Warrants and prior to the Termination Date, issues, sells, distributes or otherwise
grants in any manner to any but not all holders of the Common Stock any rights to subscribe for or to purchase, or any warrants or options for the purchase of, Common Stock or any stock or securities
convertible into or exchangeable for Common Stock (any such rights, warrants or options being herein called "Section 2.4 Options" and any such convertible or exchangeable stock or securities being
herein called "Section 2.4 Convertible Securities"), whether or not such Section 2.4 Options or the rights to convert or exchange such Section 2.4 Convertible Securities are immediately exercisable,
and the price per share at which Common Stock is issuable upon the exercise of such Section 2.4 Options or upon the conversion or exchange of such Section 2.4 Convertible Securities is less than 75%
of the Current Market Price per share of Common Stock on the record date for the issuance, sale, distribution or granting of such Section 2.4 Options or Section 2.4 Convertible Securities (any such
event being herein called a "Section 2.4 Triggering Derivative Issuance") then, effective upon such Section 2.4 Triggering Derivative Issuance, the number of shares of Class E Common for which each
Series B Warrant is exercisable shall be adjusted to equal the product obtained by multiplying the number of shares of Class E Common for which each Series B Warrant is exercisable immediately prior
to such Section 2.4 Triggering Derivative Issuance by a fraction (A) the numerator of which is the number of shares of Common Stock outstanding immediately after such Section 2.4 Triggering Derivative
Issuance (calculated on a fully diluted basis, taking into account such Section 2.4 Triggering Derivative Issuance and assuming the exercise of such Section 2.4 Options or Section 2.4 Convertible
Securities, but excluding any adjustments to be made as a result thereof under the Series B Warrants, the Series A Warrants or the Convertible Notes), and (B) the denominator of which is the sum of
(1) the number of shares of Common Stock outstanding immediately prior to such Section 2.4 Triggering Derivative Issuance (calculated on a fully diluted basis), and (2) the Section 2.4 Aggregate
Issuance Price divided by the Current Market Price. No additional adjustment of the Exercise Price will be made upon the actual exercise of such Section 2.4 Options or upon conversion or exchange of
such Section 2.4 Convertible Securities or upon the conversion or exchange of the Section 2.4 Convertible Securities </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>7</FONT></P>

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<P><FONT SIZE=2>
issuable upon the exercise of rights, warrants or options, or the exercise of Section 2.4 Options issued upon the conversion or exchange of convertible or exchangeable securities. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
the Company pays a dividend or makes any other distribution payable in Section 2.3 Options, Section 2.4 Options, Section 2.3 Convertible Securities and Section 2.4 Convertible
Securities, then, for purposes of Sections 2.3 and 2.4 of the Series B Warrants, such Section 2.3 Options, Section 2.4 Options, Section 2.3 Convertible Securities or Section 2.4 Convertible Securities
shall be deemed to have been issued or sold without consideration. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
at any time the Company (except as hereinafter provided) issues or sells any additional shares of Common Stock in a transaction that was offered to all holders of Common Stock then
outstanding for consideration in an amount per additional share of Common Stock less than the Current Market Price, then the number of shares of Class E Common for which each Series B Warrant is
exercisable will be adjusted to equal the product obtained by multiplying the number of shares of Class E Common for which such Series B Warrant is exercisable immediately prior to such issue or sale
by a fraction (A) the numerator of which is the number of shares of Common Stock outstanding immediately after such issue or sale (calculated on a fully diluted basis, taking into account such issue
or sale, but excluding any adjustments to be made as a result thereof under the Sereis A Warrants, the Series B Warrants or the Convertible Notes), and (B) the denominator of which is the sum of (1)
the number of shares of Common Stock outstanding immediately prior to such issue or sale (calculated on a fully diluted basis),
and (2) the aggregate consideration received from the issuance or sale of the additional shares of Common Stock divided by the Current Market Price. Notwithstanding the foregoing, no adjustment will
be made under this paragraph for issuances of shares of Common Stock (i) upon exercise of the Series B Warrants, (ii) upon conversion of the outstanding Convertible Notes, (iii) upon exercise,
conversion or exchange of any Section 2.3 Options, Section 2.4 Options, Section 2.3 Convertible Securities or Section 2.4 Convertible Securities, or (iv) in the event that the issuance of Common Stock
giving rise to such adjustment is part of a transaction in which the holders of the Series B Warrants are given the opportunity to purchase such shares of Common Stock at the same price per share as
all other offerees in the offering and on a pro rata share-for-share basis with all other offerees. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
at any time the Company (except as hereinafter provided) issues or sells any additional shares of Common Stock other than in a transaction that was offered to all holders of Common
Stock then outstanding for consideration in an amount per additional share of Common Stock less than 75% of the Current Market Price, then the number of shares of Class E Common for which each Series
B Warrant is exercisable will be adjusted to equal the product obtained by multiplying the number of shares of Class E Common for which such Series B Warrant is exercisable immediately prior to such
issue or sale by a fraction (A) the numerator of which is the number of shares of Common Stock outstanding immediately after such issue or sale (calculated on a fully diluted basis, taking into
account such issue or sale, but excluding any adjustments to be made as a result thereof under the Series B Warrants, the Series A Warrants or the Convertible Notes), and (B) the denominator of which
is the sum of (1) the number of shares of Common Stock outstanding immediately prior to such issue or sale (calculated on a fully diluted basis), and (2) the aggregate consideration received from the
issuance or sale of the additional shares of Common Stock divided by the Current Market Price. Notwithstanding the foregoing, no adjustment will be made under this paragraph for issuances of shares of
Common Stock (i) upon exercise of the Series B Warrants, (ii) upon conversion of the Convertible Notes, (iii) upon exercise, conversion or exchange of any Section 2.3 Options, Section 2.4 Options,
Section 2.3 Convertible Securities or Section 2.4 Convertible Securities, or (iv) in the event that the issuance of Common Stock giving rise to such adjustment is part of a transaction in which the
holders of the Series B Warrants are given the opportunity to purchase such shares of Common Stock at the same price per share as all other offerees in the offering and on a pro rata share-for-share
basis with all other offerees. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>8</FONT></P>

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<P><FONT SIZE=2><A
NAME="dg1872_item_2._exhibits."> </A>
<A NAME="toc_dg1872_1"> </A>
<BR></FONT><FONT SIZE=2><B>Item 2. Exhibits.    <BR>  </B></FONT></P>

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<TH WIDTH="10%" ALIGN="CENTER"><FONT SIZE=1><B>Number</B></FONT><HR NOSHADE></TH>
<TH WIDTH="3%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="88%" ALIGN="CENTER"><FONT SIZE=1><B>Description</B></FONT><HR NOSHADE></TH>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="10%"><FONT SIZE=2>1.</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="88%"><FONT SIZE=2>Amended and Restated Certificate of Incorporation of Polymer Group, Inc.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="10%"><FONT SIZE=2><BR>
2.</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="88%"><FONT SIZE=2><BR>
Amended and Restated By-Laws of Polymer Group, Inc.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="10%"><FONT SIZE=2><BR>
3.</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="88%"><FONT SIZE=2><BR>
Shareholders Agreement, dated March 5, 2003, among Polymer Group, Inc. and certain of its shareholders.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="10%"><FONT SIZE=2><BR>
4.1</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="88%"><FONT SIZE=2><BR>
Series A Warrant Agreement, dated March 5, 2003, among Polymer Group, Inc. and Wachovia Bank, N.A., as Warrant Agent.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="10%"><FONT SIZE=2><BR>
4.2</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="88%"><FONT SIZE=2><BR>
Series B Warrant Agreement, dated March 5, 2003, among Polymer Group, Inc. and Wachovia Bank, N.A., as Warrant Agent.</FONT></TD>
</TR>
</TABLE>
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<P ALIGN="CENTER"><FONT SIZE=2>9</FONT></P>

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NAME="page_jc1872_1_10"> </A> </FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="jc1872_signatures"> </A>
<A NAME="toc_jc1872_1"> </A>
<BR></FONT><FONT SIZE=2><B>SIGNATURES    <BR>  </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant to the requirements of Section 12 of the Securities Exchange Act of 1934, the Registrant has duly caused this registration statement to be signed on its
behalf by the undersigned, thereto duly authorized. </FONT></P>

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<TD WIDTH="39%"><FONT SIZE=2>Date: March 5, 2003</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2><FONT SIZE=2>POLYMER GROUP, INC.<BR>
(Registrant)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="54%" ALIGN="CENTER"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>JAMES G. BOYD</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2><FONT SIZE=2>Name:&nbsp;&nbsp;&nbsp;&nbsp;James G. Boyd</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2><FONT SIZE=2>Title:&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT SIZE=2><I>Executive Vice President, Treasurer and Chief Financial Officer</I></FONT></TD>
</TR>
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<P ALIGN="CENTER"><FONT SIZE=2>10</FONT></P>

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<P><br><A NAME="03CHI1872_1">QuickLinks</A><br></P><!-- TOC_BEGIN -->
<FONT SIZE=2><A HREF="#toc_de1872_1">INFORMATION REQUIRED IN REGISTRATION STATEMENT</A></FONT><BR>
<UL>
<FONT SIZE=2><A HREF="#toc_de1872_2">Item 1. Description of Registrant's Securities to be Registered.</A></FONT><BR>
</UL>
<!-- TOC_BEGIN -->
<UL>
<FONT SIZE=2><A HREF="#toc_dg1872_1">Item 2. Exhibits.</A></FONT><BR>
</UL>
<!-- TOC_BEGIN -->
<FONT SIZE=2><A HREF="#toc_jc1872_1">SIGNATURES</A></FONT><BR>
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</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-1
<SEQUENCE>3
<FILENAME>a2104906zex-1.htm
<DESCRIPTION>EXHIBIT 1
<TEXT>
<HTML>
<HEAD>

</HEAD>
<BODY BGCOLOR="#FFFFFF" LINK=BLUE  VLINK=PURPLE>
<BR>
<FONT SIZE=3 ><A HREF="#03CHI1872_2">QuickLinks</A></FONT>
<font size=3> -- Click here to rapidly navigate through this document</font>
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<P ALIGN="RIGHT"><FONT SIZE=2><A
NAME="ka1872_exhibit_1"> </A>
<A NAME="toc_ka1872_1"> </A>
<BR></FONT><FONT SIZE=2><B>EXHIBIT 1    <BR>  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B><I>AMENDED AND RESTATED<BR>
CERTIFICATE OF INCORPORATION<BR>
OF<BR>
POLYMER GROUP,&nbsp;INC.</I></B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>ARTICLE ONE </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
name of the Corporation is POLYMER GROUP,&nbsp;INC. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>ARTICLE TWO </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
address of the Corporation's registered office in the State of Delaware is 32 Loockerman Square, Suite L-100, Dover, Delaware, County of Kent. The name of its registered
agent at such address is The Prentice-Hall Corporation System,&nbsp;Inc. The registered office and/or registered agent of the Corporation may be changed from time to time by action of
the board of directors of the Corporation (the "Board of Directors"). </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>ARTICLE THREE </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
nature of the business or purposes to be conducted or promoted is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of
the State of Delaware (the "Delaware General Corporation Law") either alone or with others through wholly or
partially owned subsidiaries, as a partner (limited or general) in any partnership, as a joint venturer in any joint venture, or otherwise. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>ARTICLE FOUR </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;1.
</FONT><FONT SIZE=2><I>Authorized Shares</I></FONT><FONT SIZE=2>. </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;The
total number of shares of capital stock which the Corporation has authority to issue is 21,220,086 shares, consisting of: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(i)</FONT></DT><DD><FONT SIZE=2>19,279,388
shares of Class&nbsp;A Common Stock, par value $.01 per share ("Class&nbsp;A Common");
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(ii)</FONT></DT><DD><FONT SIZE=2>800,000
shares of Class&nbsp;B Common Stock, par value $.01 per share ("Class&nbsp;B Common");
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(iii)</FONT></DT><DD><FONT SIZE=2>118,453
shares of Class&nbsp;C Common Stock, par value $.01 per share ("Class&nbsp;C Common");
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(iv)</FONT></DT><DD><FONT SIZE=2>498,688
shares of Class&nbsp;D Common Stock, par value $.01 per share ("Class&nbsp;D Common"); and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(v)</FONT></DT><DD><FONT SIZE=2>523,557
shares of Class&nbsp;E Common Stock, par value $.01 per share ("Class&nbsp;E Common"). </FONT></DD></DL>
</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Class&nbsp;A Common, Class&nbsp;B Common, Class&nbsp;C Common, Class&nbsp;D Common and Class&nbsp;E Common are referred to collectively as the "Common Stock." The shares of
Common Stock shall have the rights, preferences and limitations set forth below. </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;Notwithstanding
anything herein to the contrary, the Corporation shall not be authorized to issue non-voting equity securities of any class, series or other
designation to the extent prohibited by Section&nbsp;1123(a)(6) of title 11 of the United States Code (the "Bankruptcy Code"); provided, however, that the foregoing restriction shall (i)&nbsp;have
no further force and effect beyond that required under Section&nbsp;1123(a)(6) of the Bankruptcy Code, (ii)&nbsp;only have such force and effect for so long as such Section&nbsp;1123(a)(6) is in
effect and applies to the Corporation and (iii)&nbsp;be deemed void or eliminated if required under applicable law. </FONT></P>

</UL>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;2.
The preferences, limitations, designations and relative rights of the shares of each class and the qualifications, limitations or restrictions thereof shall be as
follows: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Common Stock</I></FONT><FONT SIZE=2>. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except
as otherwise provided in this Section&nbsp;2(a) of Article Four or as otherwise required by applicable law, all shares of Class&nbsp;A Common, Class&nbsp;B Common,
Class&nbsp;C Common, Class&nbsp;D Common and Class&nbsp;E Common shall be identical in all respects and shall entitle the holders thereof to the same rights, preferences and privileges, subject
to the same qualifications, limitations and restrictions, as set forth herein. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Voting Rights</I></FONT><FONT SIZE=2>. Except as otherwise required by applicable law, all holders of Class&nbsp;A Common, Class&nbsp;B
Common, Class&nbsp;C Common, Class&nbsp;D Common and Class&nbsp;E Common shall be entitled to one vote per share on all matters to be voted on by the Corporation's stockholders, and the holders
of Class&nbsp;A Common, Class&nbsp;B Common, Class&nbsp;C Common, Class&nbsp;D Common and Class&nbsp;E Common shall vote together as a single class. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Distributions</I></FONT><FONT SIZE=2>. At the time of each Distribution, such Distribution shall be made to the holders of issued and
outstanding shares of Class&nbsp;A Common, Class&nbsp;B Common, Class&nbsp;C Common, Class&nbsp;D Common and Class&nbsp;E Common in the following amounts and priority: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A)&nbsp;&nbsp;The
holders of Class&nbsp;A Common, Class&nbsp;B Common and Class&nbsp;C Common, as a group, shall be entitled to receive all or a portion of such Distribution
(ratably among such holders on a share-for-share basis based upon the number of shares of Class&nbsp;A Common, Class&nbsp;B Common and Class&nbsp;C Common held by each
such holder as of the time of such Distribution) in a cumulative amount equal to the aggregate Initial Equity Hurdle Distribution, and no Distribution or any portion thereof shall be made under
paragraphs (ii)(B) or (ii)(C) below until the entire amount of the Initial Equity Hurdle Distribution payable on the outstanding shares of Class&nbsp;A Common, Class&nbsp;B Common and
Class&nbsp;C Common as of the time of such Distribution has been paid in full. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B)&nbsp;&nbsp;Once
the Initial Equity Hurdle Distribution has been paid in full, the holders of Class&nbsp;A Common, Class&nbsp;B Common, Class&nbsp;C Common and Class&nbsp;D
Common, as a group, shall be entitled to receive all or a portion of such further Distributions (ratably among such holders on a share-for-share basis based upon the number of
shares of Class&nbsp;A Common, Class&nbsp;B Common, Class&nbsp;C Common and Class&nbsp;D Common held by each such holder as of the time of such Distribution) in a cumulative amount equal to
the Subsequent Equity Hurdle Distribution, and no Distribution or any portion thereof shall be made under paragraph&nbsp;(ii)(C) below until the entire amount of the Subsequent Equity Hurdle
Distribution payable on the outstanding shares of Class&nbsp;A Common, Class&nbsp;B Common, Class&nbsp;C Common and Class&nbsp;D Common has been paid in full. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C)&nbsp;&nbsp;After
the required amounts of the Initial Equity Hurdle Distribution and Subsequent Equity Hurdle Distribution have been paid in full, the holders of Class&nbsp;A
Common, Class&nbsp;B Common, Class&nbsp;C Common, Class&nbsp;D Common and Class&nbsp;E Common, as a group, shall be entitled to receive all of such further Distributions (ratably among such
holders on a share-for-share basis based upon the number of shares of Common Stock held by each such holder as of the time of such Distribution). </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(D)&nbsp;&nbsp;In
determining whether the Initial Equity Hurdle Distribution or Subsequent Equity Hurdle Distribution has been satisfied, all Distributions made from March&nbsp;5,
2003 until the date of determination shall be aggregated. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Class&nbsp;C Dividend</I></FONT><FONT SIZE=2>. On the Class&nbsp;C Dividend Payment Date, the Corporation shall (to the extent permitted
under the General Corporation Law of Delaware) pay a cash dividend </FONT></P>

</UL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>2</FONT></P>

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<P><FONT SIZE=2>
on each share of Class&nbsp;C Common (the "</FONT><FONT SIZE=2><I>Class&nbsp;C Dividend</I></FONT><FONT SIZE=2>") equal to a pro rata portion of the lesser of (i)&nbsp;1% per annum of the
aggregate principal amount outstanding under the SPE Notes and (ii)&nbsp;$1,000,000. The Class&nbsp;C Dividend shall be payable on January&nbsp;1 of each year, beginning January&nbsp;1, 2004
(the "</FONT><FONT SIZE=2><I>Class&nbsp;C Dividend Payment Date</I></FONT><FONT SIZE=2>") and shall terminate on the maturity date of the SPE Notes. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Sale Transaction</I></FONT><FONT SIZE=2>. In the event the Corporation is acquired by any Person in a Sale Transaction, proper provision shall
be made by the Corporation to ensure that the holders of Common Stock are treated in accordance with the provisions of Section&nbsp;2(a)(ii)&nbsp;of this Article Four if and only to the extent
that a Distribution of the proceeds of such Sale Transaction is required to be made hereunder. For purposes of ensuring compliance with the provisions of Section&nbsp;2(a)(ii)&nbsp;of this Article
Four, all amounts received by any holders of Common Stock in their sole capacity as a holder of Common Stock in connection with a Sale Transaction shall be treated as a Distribution from the
Corporation to holders of Common Stock, and any non-cash consideration received by a holder of Common Stock in their sole capacity as a holder of Common Stock will be valued at its fair
market value, on a date selected by the Board of Directors within ten days of its distribution to holders of Common Stock, as determined by the Board of Directors in good faith. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Stock Splits and Stock Dividends</I></FONT><FONT SIZE=2>. The Corporation shall not in any manner subdivide (by stock split, stock dividend or
otherwise) or combine (by stock split, stock dividend or otherwise) the outstanding Common Stock of one class unless the outstanding Common Stock of all the other classes shall be proportionately
subdivided or combined. All such subdivisions and combinations shall be payable only in Class&nbsp;A Common to the holders of Class&nbsp;A Common, in Class&nbsp;B Common to the holders of
Class&nbsp;B Common, in Class&nbsp;C Common to the holders of Class&nbsp;C Common, in Class&nbsp;D Common to the holders of Class&nbsp;D Common and in Class&nbsp;E Common to the holders of
the Class&nbsp;E Common. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Registration of Transfer</I></FONT><FONT SIZE=2>. The Corporation shall keep at its principal office (or such other place as the Corporation
reasonably designates) a register for the registration of shares of Common Stock. Upon the surrender of any certificate representing shares of any class of Common Stock at such place, the Corporation
shall, at the request of the registered holder of such certificate, execute and deliver a new certificate or certificates in exchange therefor representing in the aggregate the number of shares of
such class represented by the surrendered certificate, and the Corporation forthwith shall cancel such surrendered certificate. Each such new certificate shall be registered in such name and shall
represent such number of shares of such class as is requested by the holder of the surrendered certificate and shall be substantially identical in form to the surrendered certificate. The issuance of
new certificates shall be made without charge to the holders of the surrendered certificates for any issuance tax in respect thereof or other cost incurred by the Corporation in connection with such
issuance. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Replacement</I></FONT><FONT SIZE=2>. Upon receipt of evidence reasonably satisfactory to the Corporation (an affidavit of the registered holder
shall be satisfactory) of the ownership and the loss, theft, destruction or mutilation of any certificate evidencing one or more shares of any class of Common Stock, and in the case of any such loss,
theft or destruction, upon receipt of indemnity reasonably satisfactory to the Corporation (provided that if the holder is a financial institution or other institutional investor its own agreement
shall be satisfactory), or, in the case of any such mutilation upon surrender of such certificate, the Corporation shall (at its expense) execute and deliver in lieu of such certificate a new
certificate of like kind representing the number of shares of such class represented by such lost, stolen, destroyed or mutilated certificate and dated the date of such lost, stolen, destroyed or
mutilated certificate. </FONT></P>

</UL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>3</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Notices</I></FONT><FONT SIZE=2>. All notices referred to herein shall be in writing, shall be delivered personally or by first class mail,
postage prepaid, and shall be deemed to have been given when so delivered or mailed to the Corporation at its principal executive offices and to any stockholder at such holder's address as it appears
in the stock records of the Corporation (unless otherwise specified in a written notice to the Corporation by such holder). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Amendment and Waiver</I></FONT><FONT SIZE=2>. No amendment or waiver of any provision of this Article Four shall be effective without the prior
written consent of the holders of a majority of the then outstanding shares of Common Stock voting as a single class; provided that no amendment directly to any terms or provisions of any class of
Common Stock that materially and adversely affects such class of Common
Stock shall be effective without the prior consent of the holders of a majority of the then outstanding shares of such class of Common Stock. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Certain Issuances of Additional Shares of Class&nbsp;A Common Stock</I></FONT><FONT SIZE=2>. If at any time the Corporation shall issue any
additional shares of Class&nbsp;A Common Stock upon conversion of the outstanding Convertible Notes, then each holder of a share of Class&nbsp;B Common Stock shall receive additional shares of
Class&nbsp;B Common Stock in an amount per share so that the holders of the Class&nbsp;B Common, as a group, continue to hold the same percentage of the combined outstanding Class&nbsp;A Common,
Class&nbsp;B Common and Class&nbsp;C Common immediately following such issuance as they held immediately prior to such issuance. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xi)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Conversion</I></FONT><FONT SIZE=2>. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A)&nbsp;&nbsp;Each
holder of issued and outstanding shares of Class&nbsp;B Common, Class&nbsp;C Common, Class&nbsp;D Common and Class&nbsp;E Common (collectively, "Convertible
Stock") shall be entitled at any time to convert any or all of the shares of such holder's Convertible Stock into an equal number of shares of Class&nbsp;A Common. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B)&nbsp;&nbsp;Each
conversion of shares of Convertible Stock into shares of Class&nbsp;A Common shall be effected by the surrender of the certificate or certificates representing
the shares to be converted at the office of the transfer agent for the Convertible Stock (or at the principal office of the Corporation if the Corporation serves as its own transfer agent for the
Convertible Stock) at any time during normal business hours, together with a written notice by the holder of such Convertible Stock stating that such holder desires to convert the shares, or a stated
number of the shares, of such Convertible Stock represented by such certificate or certificates into shares of Class&nbsp;A Common. Each conversion shall be deemed to have been effected as of the
close of business on the date on which such certificate or certificates have been surrendered and such notice has been received, and at such time the rights of the holder of the converted shares of
Convertible Stock as such holder shall cease and the person or persons in whose name or names the certificate or certificates for shares of Class&nbsp;A Common are to be issued upon such conversion
shall be deemed to have become the holder or holders of record of the shares of Class&nbsp;A Common represented thereby. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C)&nbsp;&nbsp;Promptly
after the surrender of certificates and the receipt of written notice, the transfer agent for the Convertible Stock or the Corporation, as the case may be,
shall issue and deliver in accordance with the surrendering holder's instructions (a)&nbsp;the certificate or certificates for the Class&nbsp;A Common issuable upon such conversion and
(b)&nbsp;a certificate representing any shares of Convertible Stock which were represented by the certificate or certificates delivered to the Corporation in connection with such conversion but
which were not converted. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(D)&nbsp;&nbsp;The
issuance of certificates for Class&nbsp;A Common upon conversion of shares of Convertible Stock shall be made without charge to the holders of such shares for any
issuance tax in respect thereof or other cost incurred by the Corporation in connection with such </FONT></P>

</UL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>4</FONT></P>

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conversion and the related issuance of Class&nbsp;A Common; provided that the Corporation shall not be required to pay any tax which may be payable in respect of any transfer involved in the
issuance and delivery of shares of Class&nbsp;A Common in a name other than that in which the shares of Convertible Stock were registered and no such issuance or delivery shall be made unless and
until the person or entity requesting such issuance has paid to the Corporation the amount of any such tax or has established to the satisfaction of the Corporation that such tax has been paid. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(E)&nbsp;&nbsp;The
Corporation shall at all times when Convertible Stock shall be issued and outstanding reserve and keep available out of its authorized but unissued shares of
Class&nbsp;A Common, solely for the purpose of issuance upon the conversion of the Convertible Stock such number of duly authorized shares of Class&nbsp;A Common as shall from time to time be
sufficient to effect the conversion of all issued and outstanding Convertible Stock. All shares of Class&nbsp;A Common which are so issuable shall, when issued, be duly and validly issued, fully
paid and nonassessable and free from all liens created by the Corporation. The Corporation shall take all such actions as may be necessary to assure that all such shares of Class&nbsp;A Common may
be so issued without violation of any applicable law or governmental regulation or any requirements of any domestic securities exchange upon which shares of Class&nbsp;A Common Stock may be listed
(except for official notice of issuance which shall be immediately transmitted by the Corporation upon issuance). </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(F)&nbsp;&nbsp;Neither
the transfer agent for the Convertible Stock, if any, nor the Corporation shall close its books against the transfer of shares of Common Stock in any manner
which would interfere with the timely conversion of any shares of Convertible Stock. Any shares of Convertible Stock so converted shall be retired and cancelled and shall not be reissued, and the
Corporation (without the need for stockholder action unless otherwise required by applicable state or Federal laws or regulations or rules of any stock exchange or automated quotation system) may from
time to time take such appropriate action as may be necessary to reduce the authorized number of shares of Convertible Stock accordingly. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Definitions</I></FONT><FONT SIZE=2>. Capitalized terms used in Section&nbsp;1 of this Article Four and Section&nbsp;2(a) of this Article Four
shall have the meanings set forth below. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Affiliate</I></FONT><FONT SIZE=2>" of any Person means any Person, directly or indirectly, through one or more intermediaries, controlling, controlled by, or
under common control with such Person. The term "control," as used in the immediately preceding sentence, shall mean with respect to a corporation or limited liability company, the right to exercise,
directly or indirectly, more than fifty percent (50%) of the voting rights attributable to the controlled corporation or limited liability company, and, with respect to any individual, partnership,
trust, other entity or association, the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of the controlled entity or the actions of the
individual, as the case may be. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Convertible Notes</I></FONT><FONT SIZE=2>: means the 10% convertible subordinated notes due 2007 issued by the Corporation pursuant to the Indenture by and among
the Corporation, the Guarantors named therein and Wilmington Trust Company, as trustee. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Distribution</I></FONT><FONT SIZE=2>" means each distribution on the Common Stock (excluding all Class&nbsp;C Dividends) made by the Corporation to holders of
Common Stock, in their capacity as such, whether in cash, property, or equity securities of the Corporation without consideration and whether by dividend, liquidating distributions or otherwise;
provided that (i)&nbsp;any exchange of any shares of Common Stock for other shares of Common Stock, (ii)&nbsp;any subdivision (by stock split, stock dividend or otherwise) of any outstanding
shares of Common Stock or other equity securities issued by the Company, (iii)&nbsp;any combination (by stock split, stock dividend or otherwise) of any outstanding shares of Common Stock,
(iv)&nbsp;any issuance of shares pursuant to a rights offering to </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>5</FONT></P>

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<P><FONT SIZE=2>
all holders of Common Stock, (v)&nbsp;any issuance in accordance with Article&nbsp;II of the Shareholders Agreement, dated as of March&nbsp;5, 2003, by and among the Corporation and the other
parties identified therein, (v)&nbsp;any issuance of shares in accordance with an anti-takeover plan in the form of a any shareholder rights or similar plan approved by the Board of
Directors of the Corporation, (vii)&nbsp;any payment of principal or interest on the Convertible Notes, (viii)&nbsp;any issuance of shares of Class&nbsp;A Common Stock upon conversion of the
Convertible Notes (including any shares of Class&nbsp;A Common Stock issued as a result of the antidilution provisions thereof), (ix)&nbsp;any payment of principal or interest on the Senior
Subordinated Notes, or (x)&nbsp;any issuance of shares of Class&nbsp;B Common Stock pursuant to Section&nbsp;2(a)(x)&nbsp;of this Article Four shall not be a Distribution. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Initial Equity Hurdle Distribution</I></FONT><FONT SIZE=2>" means Distributions to the holders of Common Stock in a cumulative amount equal to $600,000,000. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Person</I></FONT><FONT SIZE=2>" means an individual, a partnership, a corporation, a limited liability company, an association, a joint stock company, a trust, a
joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Sale Transaction</I></FONT><FONT SIZE=2>" means the acquisition of (i)&nbsp;all or substantially all of the assets of the Corporation or, (ii)&nbsp;at least
51% of the voting capital stock of the Corporation, in each case, by any Person, whether pursuant to a sale, merger, consolidation, reclassification, reorganization, recapitalization, purchase of
stock, tender offer, purchase of assets, lease or otherwise; provided that a transfer of voting capital stock by GOF to an Affiliate of GOF shall not constitute a Sale Transaction. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Senior Subordinated Notes</I></FONT><FONT SIZE=2>" means any of the 10% senior subordinated promissory notes issued pursuant to the Senior Subordinated Note
Purchase Agreement, dated as of March&nbsp;5, 2003, among the Corporation, each of the entities listed as guarantors on the signature pages thereto and MatlinPatterson Global Opportunities Partners
LP. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>SPE Notes</I></FONT><FONT SIZE=2>" means those promissory notes issued by PGI Special Purpose Holdings, LLC on March&nbsp;5, 2003 pursuant to the Corporation's
Joint Second Amended Modified Plan of Reorganization, dated January&nbsp;16, 2003 with an original maturity date of December&nbsp;31, 2007. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Subsequent Equity Hurdle Distribution</I></FONT><FONT SIZE=2>" means Distributions to holders of Common Stock in a cumulative amount greater than $600,000,000
and up to $1,150,000,000. </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>ARTICLE FIVE </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation is to have perpetual existence. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>ARTICLE SIX </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors, and the directors need not be elected by ballot unless required by the
By-laws of the Corporation. In furtherance and not in limitation of the powers conferred by statute, except as set forth in the By-laws of the Corporation the Board of
Directors of the Corporation is expressly authorized to make, alter, amend, change, add to or repeal the By-laws of the Corporation. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>ARTICLE SEVEN </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Meetings
of stockholders may be held within or without the State of Delaware, as the By-laws of the Corporation may provide. The books of the Corporation may be kept outside
the State of Delaware at such place or places as may be designated from time to time by the Board of Directors or in the By-laws of the Corporation. The Board of Directors shall from time
to time decide whether and to what extent and at what times and under what conditions and requirements the accounts and books </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>6</FONT></P>

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of the Corporation, or any of them, except the stock book, shall be open to the inspection of the stockholders, and no stockholder shall have any right to inspect any books or documents of the
Corporation except as conferred by the laws of the State of Delaware or as authorized by the Board of Directors. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>ARTICLE EIGHT </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Special
meetings of stockholders of the Corporation may be called only by the chairman of the board, the president, the Board of Directors, written notice of at least two directors then
in office or stockholders of the Corporation holding at least 25% of the outstanding shares of Common Stock in accordance with the By-laws. Any action required or permitted to be taken by
the stockholders of the Corporation may be effected by the written consent of the stockholders of the Corporation necessary to take such action in lieu of a meeting of the stockholders of the
Corporation. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>ARTICLE NINE </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;1.
The number of directors which shall constitute the whole Board of Directors shall be designated in the By-laws of the Corporation. Directors shall be
elected for a term of office that expires at the next succeeding annual meeting of stockholders and shall hold office until their successors have been elected and qualified. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
director may be removed from office with or without cause by affirmative vote of a majority of the outstanding shares of Common Stock voting at a meeting or acting by written consent
in lieu of an annual or special meeting of the stockholders. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;2.
Except to the extent prohibited by law or otherwise set forth herein or in the By-laws of the Corporation, the Board of Directors shall have the right
(which, to the extent exercised, shall be exclusive) to establish the rights, powers, duties, rules and procedures that from time to time shall govern the Board of Directors and each of its members,
including, without limitation, the vote required for any action by the Board of Directors, and that from time to time shall affect the directors' power to manage the business and affairs of the
Corporation. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>ARTICLE TEN </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;1.
To the fullest extent permitted by the Delaware General Corporation Law as it now exists or may hereafter be amended (but, in the case of any such amendment, only to
the extent that such amendment permits the Corporation to provide broader indemnification rights than permitted prior thereto), no director of the Corporation shall be liable to the Corporation or its
stockholders for monetary damages arising from a breach of fiduciary duty owed to the Corporation or its stockholders. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;2.
Any repeal or modification of the foregoing paragraph by the stockholders of the Corporation shall not adversely affect any right or protection of a director of the
Corporation existing at the time of such repeal or modification. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>ARTICLE ELEVEN </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation expressly elects not to be governed by Section&nbsp;203 of the Delaware General Corporation Law. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>ARTICLE TWELVE </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Corporation reserves the right to amend, alter, change or repeal any provision contained in this Amended and Restated Certificate of Incorporation in the manner now or hereafter
prescribed herein and by the laws of the State of Delaware, and all rights conferred upon stockholders herein are granted subject to this reservation; provided that any amendment, alteration, change
or repeal of </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>7</FONT></P>

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Sections 2(a)(i), (ii), (iii), (iv), (v), (ix)&nbsp;or (x)&nbsp;or 2(b) of Article&nbsp;IV, Article&nbsp;VII, Article&nbsp;IX, Article&nbsp;XII or any amendment, alteration, change or
repeal of Article&nbsp;X that results in an adverse effect upon the limitation of liability provided to directors therein, in each case, shall require the approval of at least one
Non-GOF Board Member (as such term is defined in the Shareholders Agreement dated as of March&nbsp;5, 2003, by and among the Corporation, MatlinPatterson Global Opportunities Partners LP
and the other parties identified therein (the "Shareholders Agreement")) and, in the case of any such amendment, alteration, change or repeal of Article&nbsp;X, the director adversely affected;
provided further that the foregoing approval of at least one Non-GOF Board Member shall only be required if both (a)&nbsp;at lease one Non-GOF Board Member has the right to a
seat on the board of directors pursuant to the Shareholders Agreement, and (b)&nbsp;at the time such approval is sought one of the following is true (i)&nbsp;at least one Non-GOF Board
Member is a member of the board of directors, (ii)&nbsp;if a Non-GOF Board Member is not a member of the board of directors, a Non-GOF Board Member shall have been a member
of the board of directors within sixty days of such time, or (iii)&nbsp;if a Non-GOF Board Member is not, and, within sixty days of such time, has not been, a member of the board of
directors, a nomination or designation of a proposed Non-GOF Board Member shall have been made in good faith pursuant to the terms of the Shareholders Agreement and not withdrawn, and such
nominee or designee shall not have refused or declined appointment to the board of directors. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>8</FONT></P>

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<P ALIGN="RIGHT"><FONT SIZE=2><A
NAME="kc1872_exhibit_2"> </A>
<A NAME="toc_kc1872_1"> </A>
<BR></FONT><FONT SIZE=2><B>EXHIBIT 2    <BR>  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>AMENDED AND RESTATED BY-LAWS<BR>
OF<BR>
POLYMER GROUP,&nbsp;INC.<BR>
A Delaware Corporation  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>ARTICLE I<BR>
OFFICES </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;1.
</FONT><FONT SIZE=2><I>Registered Office</I></FONT><FONT SIZE=2>. The registered office of the Corporation in the State of Delaware shall be located at 32 Loockerman
Square, Suite L-100, Dover, Delaware, County of Kent. The name of the Corporation's registered agent at such address is The Prentice-Hall Corporation System,&nbsp;Inc. The
registered office and/or registered agent of the Corporation may be changed from time to time by action of the board of directors. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;2.
</FONT><FONT SIZE=2><I>Other Offices</I></FONT><FONT SIZE=2>. The Corporation may also have offices at such other places, both within and without the State of
Delaware, as the board of directors may from time to time determine or the business of the Corporation may require. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>ARTICLE II<BR>
MEETINGS OF STOCKHOLDERS </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;1. </FONT> <FONT SIZE=2><I>Place and Time of Meetings</I></FONT><FONT SIZE=2>. An annual meeting of the stockholders shall be held each year for the purpose of electing
directors and conducting such other proper business as may come before the meeting. Unless otherwise directed by the board of directors, annual meetings of stockholders shall
be held on the fourth Friday in May beginning in 2003, if not a legal holiday and, if a legal holiday, then on the first preceding regular business day. At the annual meeting, stockholders shall elect
directors and transact such other business as properly may be brought before the meeting pursuant to Article&nbsp;II, Section&nbsp;11 hereof. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;2. </FONT> <FONT SIZE=2><I>Special Meetings</I></FONT><FONT SIZE=2>. Special meetings of stockholders may be called for any purpose and may be held at such time and place,
within or without the State of Delaware, as shall be stated in a notice of meeting or in a duly executed waiver of notice thereof. Such meetings may be called at any time by the chairman of the board,
the president, the board of directors, any two directors or stockholders of the Corporation holding at least 25% of the outstanding shares of the Corporation's common stock, in each case, by written
notice to the secretary of the Corporation (or, if no secretary is then in office, an assistant secretary or the chairman of the board or president of the Corporation). The notice required by the
foregoing sentence shall set forth the date (which shall not be less than twenty (20)&nbsp;nor more than sixty (60)&nbsp;days after the date of such notice), time and purpose or purposes of the
meeting in reasonable detail. Thereafter, the Corporation promptly shall take all steps required by this Article&nbsp;II, the General Corporation Law of the State of Delaware, as amended, the
Securities Exchange Act of 1934, as amended, the rules and regulations promulgated thereunder, and all other applicable laws, rules and regulations, to call a special meeting of the stockholders on
the date and time and solely for the purpose or purposes set forth in such notice. The only matters that may be considered at any special meeting of the stockholders are the matters specified in the
notice of the meeting delivered by the Corporation to the stockholders pursuant to Section&nbsp;4 of this Article&nbsp;II. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;3. </FONT> <FONT SIZE=2><I>Place of Meetings</I></FONT><FONT SIZE=2>. The board of directors may designate any place, either within or without the State of Delaware, as
the place of meeting for any annual meeting or for any special meeting called by the board of directors. If no designation is made, or if a special meeting be otherwise called, the place of meeting
shall be the principal executive office of the Corporation. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;4.
</FONT><FONT SIZE=2><I>Notice</I></FONT><FONT SIZE=2>. Whenever stockholders are required or permitted to take action at a meeting, written or printed notice stating
the place, date, time, and, in the case of special meetings, the purpose or purposes, of such meeting, shall be given to each stockholder entitled to vote at such meeting not </FONT></P>

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<P><FONT SIZE=2>
less than ten (10)&nbsp;nor more than sixty (60)&nbsp;days before the date of the meeting. All such notices shall be delivered, either personally or by mail, by or at the direction of the board
of directors, the chairman of the board, the president or the secretary, and if mailed, such notice shall be deemed to be delivered when deposited in the United States mail, postage prepaid, addressed
to the stockholder at his, her or its address as the same appears on the records of the Corporation. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except
when the person attends for the express purpose of objecting at the beginning of the meeting to the transaction of any business because the meeting is not lawfully called or convened. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;5.
</FONT><FONT SIZE=2><I>Stockholders List</I></FONT><FONT SIZE=2>. The officer having charge of the stock ledger of the Corporation shall make, at least 10&nbsp;days
before every meeting of the stockholders, a complete list of the stockholders entitled to vote at such meeting arranged in alphabetical order, showing the address of each stockholder and the number of
shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period
of at least 10&nbsp;days prior to the meeting, either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting or, if not so specified,
at the place where the meeting is to be held. The list shall also be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who
is present. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;6.
</FONT><FONT SIZE=2><I>Quorum</I></FONT><FONT SIZE=2>. The holders of a majority of the outstanding shares of capital stock entitled to vote, present in person or
represented by proxy, shall constitute a quorum at all meetings of the stockholders, except as otherwise provided by statute or by the certificate of incorporation. If a quorum is not present, the
holders of a majority of the shares present in person or represented by proxy at the meeting, and entitled to vote at the meeting, may adjourn the meeting to another time and/or place. When a
specified item of business requires a vote by a class or series (if the Corporation shall then have outstanding shares of more than one class or series) voting as a class, the holders of a majority of
the outstanding shares of such class or series entitled to vote, present in person or represented by proxy, shall constitute a quorum (as to such class or series) for the transaction of such item of
business. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;7.
</FONT><FONT SIZE=2><I>Adjourned Meetings</I></FONT><FONT SIZE=2>. When a meeting is adjourned to another time and place, notice need not be given of the adjourned
meeting if the time and place thereof are announced at the meeting at which the adjournment is taken. At the adjourned meeting the Corporation may transact any business which might have been
transacted at the original meeting. If the adjournment is for more than thirty days, or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting
shall be given to each stockholder of record entitled to vote at the meeting. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;8.
</FONT><FONT SIZE=2><I>Vote Required</I></FONT><FONT SIZE=2>. When a quorum is present, the affirmative vote of the majority of shares present in person or represented
by proxy at the meeting and entitled to vote on the subject matter shall be the act of the stockholders, unless (i)&nbsp;by express provisions of an applicable law or of the certificate of
incorporation a different vote is required, in which case such express provision shall govern and control the decision of such question, or (ii)&nbsp;the subject matter is the election of directors,
in which case Section&nbsp;2 of Article&nbsp;III hereof shall govern and control the approval of such subject matter. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;9.
</FONT><FONT SIZE=2><I>Voting Rights</I></FONT><FONT SIZE=2>. Except as otherwise provided by the General Corporation Law of the State of Delaware or by the
certificate of incorporation of the Corporation or any amendments thereto and subject to Section&nbsp;3 of Article&nbsp;VI hereof, every stockholder shall at every meeting of the stockholders be
entitled to one vote in person or by proxy for each share of common stock held by such stockholder. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;10. </FONT> <FONT SIZE=2><I>Proxies</I></FONT><FONT SIZE=2>. Each stockholder entitled to vote at a meeting of stockholders may authorize another person or persons to act
for him or her by proxy, but no such proxy shall be voted or acted </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>2</FONT></P>

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<P><FONT SIZE=2>
upon after three years from its date, unless the proxy provides for a longer period. A duly executed proxy shall be irrevocable if it states that it is irrevocable and if, and only as long as, it is
coupled with an interest sufficient in law to support an irrevocable power. A proxy may be made irrevocable regardless of whether the interest with which it is coupled is an interest in the stock
itself or an interest in the Corporation generally. Any proxy is suspended when the person executing the proxy is present at a meeting of stockholders and elects to vote, except that when such proxy
is coupled with an interest and the fact of the interest appears on the face of the proxy, the agent named in the proxy shall have all voting and other rights referred to in the proxy, notwithstanding
the presence of the person executing the proxy. At each meeting of the stockholders, and before any voting commences, all proxies filed at or before the meeting shall be submitted to and examined by
the secretary or a person designated by the secretary, and no shares may be represented or voted under a proxy that has been found to be invalid or irregular. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;11. </FONT> <FONT SIZE=2><I>Business Brought Before a Meeting</I></FONT><FONT SIZE=2>. At an annual meeting of the stockholders, only such business shall be conducted as
shall have been properly brought before the meeting pursuant to this Section&nbsp;11 of Article&nbsp;II; provided that, nominations for the election of directors properly made pursuant to the
provisions of Article&nbsp;III, Section&nbsp;5 of these by-laws shall also be considered at such annual meeting. To be properly brought before an annual meeting, business must be
(a)&nbsp;specified in the notice of meeting (or any supplement thereto) given by or at the direction of the board of directors, (b)&nbsp;brought before the meeting by or at the direction of the
board of directors, or (c)&nbsp;otherwise properly brought before the meeting by a stockholder. For business to be properly brought before an annual meeting by a stockholder, the stockholder must
have given timely notice thereof in writing to the secretary of the Corporation. To be timely, a stockholder's notice must (x)&nbsp;be delivered to or mailed and received at the principal executive
offices of the Corporation, at any time prior to the date of the annual meeting, and (y)&nbsp;comply with all applicable requirements of the Securities Exchange Act of 1934, as amended, and the
rules and regulations thereunder with respect to the matters set forth in this Section&nbsp;11 of Article&nbsp;II. A stockholder's notice to the secretary shall set forth as to each matter the
stockholder proposes to bring before the annual meeting (a)&nbsp;a brief description of the business desired to be brought before the annual meeting, (b)&nbsp;the name and address, as they appear
on the Corporation's books, of the stockholder proposing such business, (c)&nbsp;the class and number of shares of the Corporation which are beneficially owned by the stockholder, and (d)&nbsp;any
material interest of the stockholder in such business. Notwithstanding anything in these by-laws to the contrary, no business shall be conducted at an annual meeting except in accordance
with the procedures set forth in this Section&nbsp;11 of Article&nbsp;II. The board of directors shall, if the facts warrant, determine that the business was not properly brought before the
meeting and in accordance with the provisions of this Section&nbsp;11 of Article&nbsp;II; and if it should so determine, the board shall so declare to the meeting and any such business not
properly brought before the meeting shall not be transacted. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;12.
</FONT><FONT SIZE=2><I>Action by Written Consent</I></FONT><FONT SIZE=2>. Any action required or permitted to be taken at any meeting of the stockholders of the
Corporation may be taken by written consent in lieu of a meeting of the stockholders of the Corporation without a meeting, without prior notice and without a vote, if a consent or consents in writing,
setting forth the action so taken, shall be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a
meeting at which all shares entitled to vote thereon were present and voted and shall be delivered to the Corporation by delivery to its registered office in the State of
Delaware, its principal place of business or an officer or agent of the Corporation having custody of the book in which proceedings of meetings of stockholders are recorded. Such delivery shall be by
hand or by certified or registered mail, return receipt requested. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>3</FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2>ARTICLE III<BR>
DIRECTORS </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;1.
</FONT><FONT SIZE=2><I>General Powers</I></FONT><FONT SIZE=2>. The business and affairs of the Corporation shall be managed by or under the direction of the board of
directors. In addition to such powers as are herein and in the certificate of incorporation expressly conferred upon it, the board of directors shall have and may exercise all the powers of the
Corporation, subject to the provisions of the laws of Delaware, the certificate of incorporation and these by-laws. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;2.
</FONT><FONT SIZE=2><I>Number, Election and Term of Office</I></FONT><FONT SIZE=2>. The number of directors which shall constitute the board shall be nine (9), but the
number of directors may be changed and established from time to time by resolution adopted by affirmative vote of 50.1% of the outstanding shares of the Corporation's common stock; provided that no
reduction in the number of directors constituting the board shall result in the removal of any director from the board during such director's term of office. The board of directors shall not change
the number of directors without shareholder approval as provided in the foregoing sentence. The directors shall be elected by a plurality of the votes of the shares present in person or represented by
proxy at the meeting and entitled to vote in the election of directors; provided that, whenever the holders of any class or series of capital stock of the Corporation are entitled to elect one or more
directors pursuant to the provisions of the certificate of incorporation of the Corporation (including, but not limited to, for purposes of these by-laws, pursuant to any duly authorized
certificate of designation), such directors shall be elected by a plurality of the votes of such class or series present in person or represented by proxy at the meeting and entitled to vote in the
election of such directors. The directors shall be elected in this manner at the applicable annual meeting of the stockholders as set forth in Article&nbsp;II, Section&nbsp;1, except as provided
in Section&nbsp;4 of this Article&nbsp;III. Each director elected shall hold office until a successor is duly elected and qualified or until his or her earlier death, resignation or removal as
hereinafter provided. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;3.
</FONT><FONT SIZE=2><I>Removal and Resignation</I></FONT><FONT SIZE=2>. A director may be removed at any time with or without cause upon a majority vote of the shares
of common stock voting at a meeting or by stockholders holding a majority of the outstanding shares of the Corporation's common stock acting by written consent in lieu of a meeting. Any director may
resign at any time upon written notice to the Corporation. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;4.
</FONT><FONT SIZE=2><I>Vacancies</I></FONT><FONT SIZE=2>. Vacancies and newly created directorships resulting from any increase in the total number of directors
established by the shareholders pursuant to Section&nbsp;2 of this Article&nbsp;III may be filled only by the affirmative vote of the majority of the total number of directors then in office,
though less than a quorum, by a sole remaining director or by the affirmative vote of 50.1% of the outstanding
shares of the Corporation's common stock. Notwithstanding the foregoing, the board may not fill a vacancy with any director that was not nominated or designated in accordance with Article&nbsp;IV of
the Shareholders Agreement, dated as of March&nbsp;5, 2003, by and among the Corporation, MatlinPatterson Global Opportunities Partners L.P. and the other parties identified therein (the
"Shareholders Agreement"); provided that the foregoing restriction shall be terminated upon any termination of Article&nbsp;IV of the Shareholders Agreement. Any director elected to fill a vacancy
resulting from an increase in the number of directors shall hold office until a successor is duly elected and qualified. A director elected to fill a vacancy not resulting from an increase in the
number of directors shall have the same remaining term as that of his predecessor. Each director so chosen shall hold office until a successor is duly elected and qualified or until his or her earlier
death, resignation or removal as herein provided. Whenever holders of any class or classes of stock or series thereof are entitled by the provisions of the certificate of incorporation to elect one or
more directors, vacancies and newly created directorships of such class or classes or series may only be filled by the affirmative vote of the majority of the total number of directors elected by such
class or classes or series thereof then in office, or by a sole remaining director so elected. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>4</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;5.
</FONT><FONT SIZE=2><I>Nominations</I></FONT><FONT SIZE=2>. </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;Subject
to Section&nbsp;4 of this Article&nbsp;III, only persons who are nominated in accordance with the procedures set forth in these by-laws shall be
eligible to serve as directors. Nominations of persons for election to the board of directors of the Corporation may be made at a meeting of stockholders (i)&nbsp;by or at the direction of the board
of directors or (ii)&nbsp;by any stockholder of the Corporation who was a stockholder of record at the time of giving of notice provided for in this by-law, who is entitled to vote for
the election of directors at the meeting and who shall have complied with the notice procedures set forth below in Section&nbsp;5(b) of this Article&nbsp;III. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;In
order for a stockholder to nominate a person for election to the board of directors of the Corporation at a meeting of stockholders, such stockholder shall have
delivered timely notice of such stockholder's intent to make such nomination in writing to the secretary of the Corporation. To be timely, a stockholder's notice must (i)&nbsp;be delivered to or
mailed and received at the principal executive offices of the Corporation at any time prior to the date of such meeting of the stockholders; and (ii)&nbsp;comply with all applicable requirements of
the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder with respect to the matters set forth in this Section&nbsp;5 of Article&nbsp;III. Such stockholder's
notice shall set forth (i)&nbsp;as to each person whom the stockholder proposes to nominate for election as a director at such meeting all information relating to such person that is required to be
disclosed in solicitations of proxies for election of directors, or is otherwise required, in each case pursuant to Regulation&nbsp;14A under the Securities Exchange Act of 1934, as amended
(including such person's written consent to being named in the proxy statement as a nominee and to serving as a director if elected); (ii)&nbsp;as to the stockholder giving the notice (A)&nbsp;the
name and address, as they appear on the Corporation's books, of such stockholder and (B)&nbsp;the class and number of shares of the Corporation which are beneficially owned by such stockholder and
also which are owned of record by such stockholder; and (iii)&nbsp;as to the beneficial owner, if any, on whose behalf the nomination is made, (A)&nbsp;the name and address of such person and
(B)&nbsp;the class and number of shares of the
Corporation which are beneficially owned by such person. At the request of the board of directors, any person nominated by the board of directors for election as a director shall furnish to the
secretary of the Corporation that information required to be set forth in a stockholder's notice of nomination which pertains to the nominee. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;The
board of directors shall, if the facts warrant, determine that a nomination was not made in accordance with the procedures prescribed by the by-laws, and
if the board should so determine, the board shall so declare to the meeting and the defective nomination shall be disregarded. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;6.
</FONT><FONT SIZE=2><I>Annual Meetings</I></FONT><FONT SIZE=2>. The annual meeting of the board of directors shall be held without other notice than this
by-law immediately after, and at the same place as, the annual meeting of stockholders. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;7.
</FONT><FONT SIZE=2><I>Other Meetings and Notice</I></FONT><FONT SIZE=2>. Regular meetings, other than the annual meeting, of the board of directors may be held
without notice at such time and at such place as shall from time to time be determined by resolution of the board. Special meetings of the board of directors may be called by the chairman of the
board, at least two of the directors then in office, or the secretary of the Corporation on at least 24&nbsp;hours notice to each director, either personally, by telephone, mail, telecopy or
e-mail, which notice shall set forth the date, time and place of such special meeting. Regular meetings and special meetings may be held at any place within or outside of the State of
Delaware. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;8.
</FONT><FONT SIZE=2><I>Chairman of the Board, Quorum, Required Vote and Adjournment</I></FONT><FONT SIZE=2>. The board of directors shall elect, by the affirmative
vote of the majority of the total number of directors then in office, a chairman of the board, who shall preside at all meetings of the stockholders and board of directors at which he or she is
present. If the chairman of the board is not present at a meeting of the stockholders </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>5</FONT></P>

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or the board of directors, the president (if the president is a director and is not also the chairman of the board) shall preside at such meeting, and, if the president is not present at such
meeting, a majority of the directors present at such meeting shall elect one of their members to so preside. A majority of the total number of directors then in office shall constitute a quorum for
the transaction of business. Unless by express provision of an applicable law, the Corporation's certificate of incorporation or these by-laws a different vote is required, the vote of a
majority of directors present at a meeting at which a quorum is present shall be the act of the board of directors. If a quorum shall not be present at any meeting of the board of directors, the
directors present thereat may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;9.
</FONT><FONT SIZE=2><I>Committees</I></FONT><FONT SIZE=2>. The board of directors may, by resolution passed by a majority of the total number of directors then in
office, designate one or more committees, each committee to consist of one or more of the directors of the Corporation, which to the extent provided in such resolution or these by-laws
shall have, and may exercise, the powers of the board of directors in the management and affairs of the Corporation, except as otherwise limited by law. The board of directors may designate one or
more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. Such committee or committees shall have such
name or names as may be determined from time to time by resolution adopted by the board of directors. Each committee shall keep regular minutes of its meetings and report the same to the board of
directors when required. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;10.
</FONT><FONT SIZE=2><I>Committee Rules</I></FONT><FONT SIZE=2>. Each committee of the board of directors may fix its own rules of procedure and shall hold its
meetings as provided by such rules, except as may otherwise be provided by a resolution of the board of directors designating such committee. Unless otherwise provided in such a resolution, the
presence of at least a majority of the members of the committee shall be necessary to constitute a quorum. Unless otherwise provided in such a resolution, in the event that a member and that member's
alternate, if alternates are designated by the board of directors as provided in Section&nbsp;9 of this Article&nbsp;III, of such committee is or are absent or disqualified, the member or members
thereof present at any meeting and not disqualified from voting, whether or not such member or members constitute a quorum, may unanimously appoint another member of the board of directors to act at
the meeting in place of any such absent or disqualified member. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;11. </FONT> <FONT SIZE=2><I>Communications Equipment</I></FONT><FONT SIZE=2>. Members of the board of directors or any committee thereof may participate in and act at any
meeting of such board or committee through the use of a conference telephone or other communications equipment by means of which all persons participating in the meeting can hear and speak with each
other, and participation in the meeting pursuant to this Section&nbsp;11 shall constitute presence in person at the meeting. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;12.
</FONT><FONT SIZE=2><I>Waiver of Notice and Presumption of Assent</I></FONT><FONT SIZE=2>. Any member of the board of directors or any committee thereof who is
present at a meeting shall be conclusively presumed to have waived notice of such meeting except when such member attends for the express purpose of objecting at the beginning of the meeting to the
transaction of any business because the meeting is not lawfully called or convened. Such member shall be conclusively presumed to have assented to any action taken unless his or her dissent shall be
entered in the minutes of the meeting or unless his or her written dissent to such action shall be filed with the person acting as the secretary of the meeting before the adjournment thereof or shall
be forwarded by registered mail to the secretary of the Corporation immediately after the adjournment of the meeting. Such right to dissent shall not apply to any member who voted in favor of such
action. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;13. </FONT> <FONT SIZE=2><I>Action by Written Consent</I></FONT><FONT SIZE=2>. Unless otherwise restricted by the certificate of incorporation, any action required or
permitted to be taken at any meeting of the board of directors, or of any committee thereof, may be taken without a meeting if all members of the board or committee, </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>6</FONT></P>

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as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of the board or committee. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>ARTICLE IV<BR>
OFFICERS </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;1.
</FONT><FONT SIZE=2><I>Number</I></FONT><FONT SIZE=2>. The officers of the Corporation shall be elected by the board of directors and shall consist of a chairman of
the board, chief executive officer, president, one or more vice-presidents, a chief operating officer, a chief financial officer, an executive vice president, a secretary, a treasurer and
such other officers and assistant officers as may be deemed necessary or desirable by the board of directors. Any number of offices may be held by the same person. In its discretion, the board of
directors may choose not to fill any office for any period as it may deem advisable, except that the offices of president and secretary shall be filled as expeditiously as possible. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;2.
</FONT><FONT SIZE=2><I>Election and Term of Office</I></FONT><FONT SIZE=2>. The officers of the Corporation shall be elected annually by the board of directors at its
first meeting held after each annual meeting of stockholders or as soon thereafter as convenient. Vacancies may be filled or new offices created and filled at any meeting of the board of directors.
Each officer shall hold office until a successor is duly elected and qualified or until his or her earlier death, resignation or removal as hereinafter provided. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;3. </FONT> <FONT SIZE=2><I>Removal</I></FONT><FONT SIZE=2>. Any officer or agent elected by the board of directors may be removed by the board of directors at its
discretion, with or without cause, but such removal shall be without prejudice to the contract rights, if any, of the person so removed. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;4.
</FONT><FONT SIZE=2><I>Vacancies</I></FONT><FONT SIZE=2>. Any vacancy occurring in any office because of death, resignation, removal, disqualification or otherwise,
may be filled by the board of directors. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;5.
</FONT><FONT SIZE=2><I>Compensation</I></FONT><FONT SIZE=2>. Compensation of all officers shall be fixed by the board of directors, and no officer shall be prevented
from receiving such compensation by virtue of his or her also being a director of the Corporation. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;6.
</FONT><FONT SIZE=2><I>Chairman of the Board</I></FONT><FONT SIZE=2>. The chairman of the board shall be the chief executive officer of the Corporation, and shall have
the powers and perform the duties incident to that position. Subject to the powers of the board of directors, he or she shall be in the general and active charge of the entire business and affairs of
the Corporation, and shall be its chief policy-making officer. He or she shall preside at all meetings of the board of directors and stockholders and shall have such other powers and perform such
other duties as may be prescribed by the board of directors or provided in these by-laws. The chairman of the board is authorized to execute bonds, mortgages and other contracts requiring
a seal, under the seal of the Corporation, except where required or permitted by law to be otherwise signed and executed and except where the signing and execution thereof shall be expressly delegated
by the board of directors to some other officer or agent of the Corporation. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;7.
</FONT><FONT SIZE=2><I>The President</I></FONT><FONT SIZE=2>. The president of the Corporation shall, subject to the powers of the board of directors, shall have
general charge of the business, affairs and property of the Corporation, and control over its officers, agents and employees; and shall see that all orders and resolutions of the board of directors
are carried into effect. The president shall report to the board of directors and the chairman of the board. The president shall, in the absence or disability of the chairman of the board and chief
executive officer, act with all of the powers and be subject to all the restrictions of the chairman of the board and chief executive officer. The president is authorized to execute bonds, mortgages
and other contracts requiring a seal, under the seal of the Corporation, except where required or permitted by law to be otherwise signed and executed and except where the signing and execution
thereof shall be expressly delegated by the board of directors to some other officer or agent of the Corporation. The president shall have such other powers and perform such other duties as may </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>7</FONT></P>

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be prescribed by the chairman of the board or the board of directors or as may be provided in these by-laws. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;8.
</FONT><FONT SIZE=2><I>Chief Operating Officer</I></FONT><FONT SIZE=2>. The chief operating officer of the Corporation, if any, subject to the powers of the board of
directors, shall have general and active management of the business of the Corporation; and shall see that all orders and resolutions of the board of directors are carried into effect. The chief
operating officer shall have such other powers and perform such other duties as may be prescribed by the board of directors or as may be provided in these by-laws. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;9.
</FONT><FONT SIZE=2><I>Chief Financial Officer</I></FONT><FONT SIZE=2>. The chief financial officer of the Corporation shall, under the direction of the chairman of
the board and chief executive officer, be responsible for all financial and accounting matters and for the direction of the offices of treasurer and controller. The chief financial officer shall have
such other powers and perform such other duties as may be prescribed by the chairman of the board and chief executive officer or the board of directors or as may be provided in these
by-laws. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;10. </FONT> <FONT SIZE=2><I>Vice-presidents</I></FONT><FONT SIZE=2>. The vice-president, or if there shall be more than one, the
vice-presidents in the order determined by the board of directors or the chairman of the board, shall, in the absence or disability of the president, act with all of the powers and be
subject to all the restrictions of the president. The vice-presidents shall also perform such other duties and have such other powers as the board of directors, the chairman of the board,
the president or these by-laws may, from time to time, prescribe. The vice- presidents may also be designated as executive vice-presidents or senior
vice-presidents, as the board of directors may from time to time prescribe. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;11. </FONT> <FONT SIZE=2><I>The Secretary and Assistant Secretaries</I></FONT><FONT SIZE=2>. The secretary shall attend all meetings of the board of directors, all
meetings of the committees thereof and all meetings of the stockholders and record all the proceedings of the meetings in a book or books to be kept for that purpose or shall ensure that his or her
designee attends each such meeting to act in such capacity. Under the chairman of the board's supervision, the secretary shall give, or cause to be given, all notices required to be given by these
by-laws or by law; shall have such powers and perform such duties as the board of directors, the chairman of the board, the president or these by-laws may, from time to time,
prescribe; and shall have custody of the corporate seal of the Corporation. The secretary, or an assistant secretary, shall have
authority to affix the corporate seal to any instrument requiring it and when so affixed, it may be attested by his or her signature or by the signature of such assistant secretary. The board of
directors may give general authority to any other officer to affix the seal of the Corporation and to attest the affixing by his or her signature. The assistant secretary, or if there be more than
one, any of the assistant secretaries in the order determined by the board of directors, shall, in the absence or disability of the secretary, perform the duties and exercise the powers of the
secretary and shall perform such other duties and have such other powers as the board of directors, the chairman of the board, the president, or secretary may, from time to time, prescribe. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;12.
</FONT><FONT SIZE=2><I>The Treasurer and Assistant Treasurer</I></FONT><FONT SIZE=2>. The treasurer shall have the custody of the corporate funds and securities;
shall keep full and accurate accounts of receipts and disbursements in books belonging to the Corporation; shall deposit all monies and other valuable effects in the name and to the credit of the
Corporation as may be ordered by the chairman of the board, the chief financial officer or the board of directors; shall cause the funds of the Corporation to be disbursed when such disbursements have
been duly authorized, taking proper vouchers for such disbursements; and shall render to the chairman of the board, the chief financial officer and the board of directors, at its regular meeting or
when the board of directors so requires, an account of the Corporation; shall have such powers and perform such duties as the board of directors, the chairman of the board, the chief financial officer
or these by-laws may, from time to time, prescribe. If required by the board of directors, the treasurer shall give the Corporation a bond (which shall be rendered every six years) in such
sums and with such surety or sureties as shall be satisfactory to the board of directors for the </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>8</FONT></P>

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faithful performance of the duties of the office of treasurer and for the restoration to the Corporation, in case of death, resignation, retirement, or removal from office, of all books, papers,
vouchers, money, and other property of whatever kind in the possession or under the control of the treasurer belonging to the Corporation. The assistant treasurer, or if there are more than one, the
assistant treasurers in the order determined by the board of directors shall, in the absence or disability of the treasurer, perform the duties and exercise the powers of the treasurer. The assistant
treasurers shall perform such other duties and have such other powers as the board of directors, the chairman of the board, the chief financial officer, treasurer or these by-laws may,
from time to time, prescribe. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;13. </FONT> <FONT SIZE=2><I>Other Officers, Assistant Officers and Agents</I></FONT><FONT SIZE=2>. Officers, assistant officers and agents, if any, other than those whose
duties are provided for in these by-laws, shall have such authority and perform such duties as may from time to time be prescribed by resolution of the board of directors. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;14.
</FONT><FONT SIZE=2><I>Absence or Disability of Officers</I></FONT><FONT SIZE=2>. In the case of the absence or disability of any officer of the Corporation and of
any person hereby authorized to act in such officer's place during such officer's absence or disability, the board of directors may by resolution delegate the powers and duties of such officer to any
other officer or to any director, or to any other person selected by it. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>ARTICLE V<BR>
INDEMNIFICATION OF OFFICERS, DIRECTORS AND OTHERS </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;1.
</FONT><FONT SIZE=2><I>Right to Indemnification</I></FONT><FONT SIZE=2>. Each person who was or is made a party or is threatened to be made a party to or is otherwise
involved (including involvement as a witness) in any action, suit or proceeding, whether civil, criminal, administrative or investigative (hereinafter a "proceeding"), by reason of the fact that he or
she is or was a director or officer of the Corporation or, while a director or officer of the Corporation, is or was serving at the request of the Corporation as a director, officer, employee or agent
of another corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to an employee benefit plan (hereinafter, an "indemnitee"), whether the basis of
such proceeding is alleged action in an official capacity as a director or officer or in any other capacity while serving as a director or officer, shall be indemnified and held harmless by the
Corporation to the fullest extent authorized by the Delaware General Corporation Law, as the same exists or may hereafter be amended (but, in the case of any such amendment, only to the extent that
such amendment permits the Corporation to provide broader indemnification rights than permitted prior thereto), against all expense, liability and loss (including attorneys' fees, judgments, fines,
ERISA exercise taxes or penalties and amounts paid in settlement) reasonably incurred or suffered by such indemnitee in connection therewith and such indemnification shall continue as to an indemnitee
who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the indemnitee's heirs, executors and administrators; provided, however, that, except as provided in
Section&nbsp;2 of Article&nbsp;V with respect to proceedings to enforce rights to indemnification, the Corporation shall indemnify any such indemnitee in connection with a proceeding (or part
thereof) initiated by such indemnitee only if such proceeding (or part thereof) was authorized by the board of directors of the Corporation. The right to indemnification conferred in this
Section&nbsp;1 of Article&nbsp;V shall be a contract right and shall include the right to be paid by the Corporation the expenses incurred in defending any such proceeding in advance of its final
disposition (hereinafter an "advance of expenses"); provided, however, that, if and to the extent that the Delaware General Corporation Law requires, an advance of expenses incurred by an indemnitee
in his or her capacity as a director or officer (and not in any other capacity in which service was or is rendered by such indemnitee, including, without limitation, service to an employee benefit
plan) shall be made only upon delivery to the Corporation of an undertaking (hereinafter an "undertaking"), by or on behalf of such indemnitee, to repay all amounts so advanced if it shall ultimately
be determined by final judicial decision from which there is no further right to appeal (hereinafter a "final adjudication") that such indemnitee is not entitled to be indemnified for such expenses
under this Section&nbsp;1 of Article&nbsp;V or otherwise. The Corporation may, by action of its board of </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>9</FONT></P>

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directors, provide indemnification to employees and agents of the Corporation with the same scope and effect as the foregoing indemnification of directors and officers. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;2.
</FONT><FONT SIZE=2><I>Procedure for Indemnification</I></FONT><FONT SIZE=2>. Any indemnification of a director or officer of the Corporation or advance of expenses
under Section&nbsp;1 of this Article&nbsp;V shall be made promptly, and in any event within forty-five (45)&nbsp;days (or, in the case of an advance of expenses, twenty
(20)&nbsp;days), upon the written request of the director or officer. If a determination by the Corporation that the director or officer is entitled to indemnification pursuant to this
Article&nbsp;V is required, and the Corporation fails to respond within sixty (60)&nbsp;days to a written request for indemnity, the Corporation shall be deemed to have approved the request. If
the Corporation denies a written request for indemnification or advance of expenses, in whole or in part, or if payment in full pursuant to such request is not made within forty-five
(45)&nbsp;days (or, in the case of an advance of expenses, twenty (20)&nbsp;days), the right to indemnification or advances as granted by this Article&nbsp;V shall be enforceable by the director
or officer
in any court of competent jurisdiction. Such person's costs and expenses incurred in connection with successfully establishing his or her right to indemnification, in whole or in part, in any such
action shall also be indemnified by the Corporation. It shall be a defense to any such action (other than an action brought to enforce a claim for the advance of expenses where the undertaking
required pursuant to Section&nbsp;1 of this Article&nbsp;V, if any, has been tendered to the Corporation) that the claimant has not met the standards of conduct which make it permissible under the
Delaware General Corporation Law for the Corporation to indemnify the claimant for the amount claimed, but the burden of such defense shall be on the Corporation. Neither the failure of the
Corporation (including its board of directors, independent legal counsel, or its stockholders) to have made a determination prior to the commencement of such action that indemnification of the
claimant is proper in the circumstances because he or she has met the applicable standard of conduct set forth in the Delaware General Corporation Law, nor an actual determination by the Corporation
(including its board of directors, independent legal counsel, or its stockholders) that the claimant has not met such applicable standard of conduct, shall be a defense to the action or create a
presumption that the claimant has not met the applicable standard of conduct. The procedure for indemnification of other employees and agents for whom indemnification is provided pursuant to
Section&nbsp;1 of this Article&nbsp;V shall be the same procedure set forth in this Section&nbsp;2 for directors or officers, unless otherwise set forth in the action of the board of directors
providing indemnification for such employee or agent. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;3.
</FONT><FONT SIZE=2><I>Service for Subsidiaries</I></FONT><FONT SIZE=2>. Any person serving as a director, officer, employee or agent of a Subsidiary shall be
conclusively presumed to be serving in such capacity at the request of the Corporation. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;4.
</FONT><FONT SIZE=2><I>Reliance</I></FONT><FONT SIZE=2>. Persons who after the date of the adoption of this provision become or remain directors or officers of the
Corporation or who, while a director or officer of the Corporation, become or remain a director, officer, employee or agent of a Subsidiary, shall be conclusively presumed to have relied on the rights
to indemnity, advance of expenses and other rights contained in this Article&nbsp;V in entering into or continuing such service. The rights to indemnification and to the advance of expenses
conferred in this Article&nbsp;V shall apply to claims made against an indemnitee arising out of acts or omissions which occurred or occur both prior and subsequent to the adoption hereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;5.
</FONT><FONT SIZE=2><I>Non-Exclusivity of Rights</I></FONT><FONT SIZE=2>. The rights to indemnification and to the advance of expenses conferred in this
Article&nbsp;V shall not be exclusive of any other right which any person may have or hereafter acquire under the Certificate of Incorporation or under any statute, by-law, agreement,
vote of stockholders or disinterested directors or otherwise. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;6.
</FONT><FONT SIZE=2><I>Insurance</I></FONT><FONT SIZE=2>. The Corporation may purchase and maintain insurance on its own behalf and on behalf of any person who is or
was a director, officer, employee or agent of the Corporation or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against any expense, liability or loss </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>10</FONT></P>

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asserted against him or her and incurred by him or her in any such capacity, whether or not the Corporation would have the power to indemnify such person against such expenses, liability or loss
under the Delaware General Corporation Law. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>ARTICLE VI<BR>
CERTIFICATES OF STOCK </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;1. </FONT> <FONT SIZE=2><I>Form</I></FONT><FONT SIZE=2>. Every holder of stock in the Corporation shall be entitled to have a certificate, signed by, or in the name of the
Corporation by the chairman of the board, the president or a vice-president and the secretary or an assistant secretary of the Corporation, certifying the number of shares owned by such
holder in the Corporation. If such a certificate is countersigned (1)&nbsp;by a transfer agent or an assistant transfer agent other than the Corporation or its employee or (2)&nbsp;by a registrar,
other than the Corporation or its employee, the signature of any such chairman of the board, president, vice-president, secretary, or assistant secretary may be facsimiles. In case any
officer or officers who have signed, or whose facsimile signature or signatures have been used on, any such certificate or certificates shall cease to be such officer or officers of the Corporation
whether because of death, resignation or otherwise before such certificate or certificates have been delivered by the Corporation, such certificate or certificates may nevertheless be issued and
delivered as though the person or persons who signed such certificate or certificates or whose facsimile signature or signatures have been used thereon had not ceased to be such officer or officers of
the Corporation. All certificates for shares shall be consecutively numbered or otherwise identified. The name of the person to whom the shares represented thereby are issued, with the number of
shares and date of issue, shall be entered on the books of the Corporation. Shares of stock of the Corporation shall only be transferred on the books of the Corporation by the holder of record thereof
or by such holder's attorney duly authorized in writing, upon surrender to the Corporation of the certificate or certificates for such shares endorsed by the appropriate person or persons, with such
evidence of the authenticity of such endorsement, transfer, authorization, and other matters as the Corporation may reasonably require, and accompanied by all necessary stock transfer stamps. In that
event, it shall be the duty of the Corporation to issue a new certificate to the person entitled thereto, cancel the old certificate or certificates, and record the transaction on its books. The board
of directors may appoint a bank or trust company organized under the laws of the United States or any state thereof to act as its transfer agent or registrar, or both in connection with the transfer
of any class or series of securities of the Corporation. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;2. </FONT> <FONT SIZE=2><I>Lost Certificates</I></FONT><FONT SIZE=2>. The board of directors may direct a new certificate or certificates to be issued in place of any
certificate or certificates previously issued by the Corporation alleged to have been lost, stolen, or destroyed, upon the making of an affidavit of that fact by the person claiming the certificate of
stock to be lost, stolen, or destroyed. When authorizing such issue of a new certificate or certificates, the Corporation may, in its discretion and as a condition precedent to the issuance thereof,
require the owner of such lost, stolen, or destroyed certificate or certificates, or his or her legal representative, to give the Corporation a bond sufficient to indemnify the Corporation against any
claim that may be made against the Corporation on account of the loss, theft or destruction of any such certificate or the issuance of such new certificate. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;3.
</FONT><FONT SIZE=2><I>Fixing a Record Date for Stockholder Meetings</I></FONT><FONT SIZE=2>. In order that the Corporation may determine the stockholders entitled to
notice of or to vote at any meeting of stockholders or any adjournment thereof, the board of directors may fix a record date, which record date shall not precede the date upon which the resolution
fixing the record date is adopted by the board of directors, and which record date shall not be more than sixty (60)&nbsp;nor less than ten (10)&nbsp;days before the date of such meeting. If no
record date is fixed by the board of directors, the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be the close of business on the next
day
preceding the day on which notice is first given. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>11</FONT></P>

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the meeting; provided, however, that the board of directors may fix a new record date for the adjourned meeting. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;4. </FONT> <FONT SIZE=2><I>Fixing a Record Date for Other Purposes</I></FONT><FONT SIZE=2>. In order that the Corporation may determine the stockholders entitled to
receive payment of any dividend or other distribution or allotment or any rights or the stockholders entitled to exercise any rights in respect of any change, conversion or exchange of stock, or for
the purposes of any other lawful action, the board of directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted, and
which record date shall be not more than sixty (60)&nbsp;days prior to such action. If no record date is fixed, the record date for determining stockholders for any such purpose shall be at the
close of business on the day on which the board of directors adopts the resolution relating thereto. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;5. </FONT> <FONT SIZE=2><I>Registered Stockholders</I></FONT><FONT SIZE=2>. Prior to the surrender to the Corporation of the certificate or certificates for a share or
shares of stock with a request to record the transfer of such share or shares, the Corporation may treat the registered owner as the person entitled to receive dividends, to vote, to receive
notifications, and otherwise to exercise all the rights and powers of an owner. The Corporation shall not be bound to recognize any equitable or other claim to or interest in such share or shares on
the part of any other person, whether or not it shall have express or other notice thereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;6.
</FONT><FONT SIZE=2><I>Subscriptions for Stock</I></FONT><FONT SIZE=2>. Unless otherwise provided for in the subscription agreement, subscriptions for shares shall be
paid in full at such time, or in such installments and at such times, as shall be determined by the board of directors. Any call made by the board of directors for payment on subscriptions shall be
uniform as to all shares of the same class or as to all shares of the same series. In case of default in the payment of any installment or call when such payment is due, the Corporation may proceed to
collect the amount due in the same manner as any debt due the Corporation. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>ARTICLE VII<BR>
GENERAL PROVISIONS </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;1.
</FONT><FONT SIZE=2><I>Dividends</I></FONT><FONT SIZE=2>. Dividends upon the capital stock of the Corporation, subject to the provisions of the certificate of
incorporation, if any, may be declared by the board of directors at any regular or special meeting, in accordance with applicable law. Dividends may be paid in cash, in property, or in shares of the
capital stock, subject to the provisions of the certificate of incorporation. Before payment of any dividend, there may be set aside out of any funds of the Corporation available for dividends such
sum or sums as the directors from time to time, in their absolute discretion, think proper as a reserve or reserves to meet contingencies, or for equalizing dividends, or for repairing or maintaining
any property of the Corporation, or any other purpose and the directors may modify or abolish any such reserve in the manner in which it was created. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;2.
</FONT><FONT SIZE=2><I>Checks, Drafts or Orders</I></FONT><FONT SIZE=2>. All checks, drafts, or other orders for the payment of money by or to the Corporation and all
notes and other evidences of indebtedness issued in the name of the Corporation shall be signed by such officer or officers, agent or agents of the Corporation, and in such manner, as shall be
determined by resolution of the board of directors or a duly authorized committee thereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;3.
</FONT><FONT SIZE=2><I>Contracts</I></FONT><FONT SIZE=2>. In addition to the powers otherwise granted to officers pursuant to Article&nbsp;IV hereof, the board of
directors may authorize any officer or officers, or any agent or agents, of the Corporation to enter into any contract or to execute and deliver any instrument in the name of and on behalf of the
Corporation, and such authority may be general or confined to specific instances. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;4. </FONT> <FONT SIZE=2><I>Loans</I></FONT><FONT SIZE=2>. The Corporation may lend money to, or guarantee any obligation of, or otherwise assist any officer or other
employee of the Corporation or of its subsidiaries, including any officer or employee who is a director of the Corporation or its subsidiaries, whenever, in the judgment of the directors, such loan,
guaranty or assistance may reasonably be expected to benefit the </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>12</FONT></P>

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Corporation. The loan, guaranty or other assistance may be with or without interest, and may be unsecured, or secured in such manner as the board of directors shall approve, including, without
limitation, a pledge of shares of stock of the Corporation. Nothing in this section contained shall be deemed to deny, limit or restrict the powers of guaranty or warranty of the Corporation at common
law or under any statute. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;5.
</FONT><FONT SIZE=2><I>Fiscal Year</I></FONT><FONT SIZE=2>. The fiscal year of the Corporation shall be fixed by resolution of the board of directors. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;6.
</FONT><FONT SIZE=2><I>Corporate Seal</I></FONT><FONT SIZE=2>. The board of directors shall provide a corporate seal which shall be in the form of a circle and shall
have inscribed thereon the name of the Corporation and the words "Corporate Seal, Delaware." The seal may be used by causing it or a facsimile thereof to be impressed or affixed or reproduced or
otherwise. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;7. </FONT> <FONT SIZE=2><I>Voting Securities Owned By Corporation</I></FONT><FONT SIZE=2>. Voting securities in any other corporation held by the Corporation shall be
voted by an officer of the Corporation or other person as authorized or directed by the board of directors, which authorization or direction may be general or confined to specific instances. Any
person authorized to vote securities shall have the power to appoint proxies, with general power of substitution. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;8.
</FONT><FONT SIZE=2><I>Inspection of Books and Records</I></FONT><FONT SIZE=2>. Any stockholder of record, in person or by attorney or other agent, shall, upon written
demand under oath stating the purpose thereof, have the right during the
usual hours for business to inspect for any proper purpose the Corporation's stock ledger, a list of its stockholders, and its other books and records, and to make copies or extracts therefrom. A
proper purpose shall mean any purpose reasonably related to such person's interest as a stockholder. In every instance where an attorney or other agent shall be the person who seeks the right to
inspection, the demand under oath shall be accompanied by a power of attorney or such other writing which authorizes the attorney or other agent to so act on behalf of the stockholder. The demand
under oath shall be directed to the Corporation at its registered office in the State of Delaware or at its principal place of business. The Corporation shall have a reasonable amount of time to
respond to any such request. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;9. </FONT> <FONT SIZE=2><I>Section Headings</I></FONT><FONT SIZE=2>. Section headings in these by-laws are for convenience of reference only and shall not be
given any substantive effect in limiting or otherwise construing any provision herein. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;10.
</FONT><FONT SIZE=2><I>Inconsistent Provisions</I></FONT><FONT SIZE=2>. In the event that any provision of these by-laws is or becomes inconsistent with
any provision of the certificate of incorporation, the General Corporation Law of the State of Delaware or any other applicable law, the provision of these by-laws shall not be given any
effect to the extent of such inconsistency but shall otherwise be given full force and effect. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>ARTICLE VIII<BR>
AMENDMENTS </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;These
by-laws may be amended, altered, or repealed and new by-laws adopted at any meeting of the board of directors by the affirmative vote of the majority of the
total number of directors then in office; provided that any amendment, alteration or repeal of Sections 1, 2 or 9 of Article&nbsp;II, Sections 2, 3, 4 or 5 of Article&nbsp;III, Section&nbsp;8 of
Article&nbsp;VII, Article&nbsp;VIII or any amendment, alteration or repeal of Article&nbsp;V that results in an adverse effect upon the indemnification provided to directors therein, in each of
the foregoing cases, pursuant to the affirmative vote of the majority of the total number of directors then in office also shall require the approval of at least one Non-GOF Board Member
(as such term is defined in the Shareholders Agreement); provided further that the foregoing approval of at least one Non-GOF Board Member shall only be required if both (a)&nbsp;at
least one Non-GOF Board Member has the right to a seat on the board of directors pursuant to the Shareholders Agreement, and </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>13</FONT></P>

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(b)&nbsp;at the time such approval is sought one of the following is true (i)&nbsp;at least one Non-GOF Board Member is a member of the board of directors, (ii)&nbsp;if a
Non-GOF Board Member is not a member of the board of directors, a Non-GOF Board Member shall have been a member of the board of directors within sixty days of such time, or
(iii)&nbsp;if a Non-GOF Board Member is not, and, within sixty days of such time, has not been, a member of the board of directors, a nomination or designation of a proposed
Non-GOF Board Member shall have been made in good faith pursuant to the terms of the Shareholders Agreement and not withdrawn, and such nominee or designee shall not have refused or
declined appointment to the board of directors. The fact that the power to adopt, amend, alter, or repeal the by-laws has been conferred upon the board of directors shall not divest the
stockholders of such powers as set forth in the certificate of incorporation. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>14</FONT></P>

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<A NAME="toc_ke1872_1"> </A>
<BR></FONT><FONT SIZE=2><B>EXHIBIT 3    <BR>  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>SHAREHOLDERS AGREEMENT  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Shareholders Agreement (this "</FONT><FONT SIZE=2><I>Agreement</I></FONT><FONT SIZE=2>") dated as of March&nbsp;5, 2003 (the
"</FONT><FONT SIZE=2><I>Effective Date</I></FONT><FONT SIZE=2>") is entered into by and among Polymer Group,&nbsp;Inc., a Delaware corporation (the
"</FONT><FONT SIZE=2><I>Company</I></FONT><FONT SIZE=2>"), MatlinPatterson Global Opportunities Partners L.P., a Delaware limited partnership ("</FONT><FONT SIZE=2><I>GOF</I></FONT><FONT SIZE=2>"),
Northeast Investors Trust, a Massachusetts business trust ("</FONT><FONT SIZE=2><I>NIT</I></FONT><FONT SIZE=2>"), One Group Income Bond Fund, a Massachusetts mutual fund ("</FONT><FONT SIZE=2><I>One
Group Income</I></FONT><FONT SIZE=2>"), One Group High Yield Bond Fund, a Massachusetts mutual fund ("</FONT><FONT SIZE=2><I>One Group High Yield</I></FONT><FONT SIZE=2>"), Southern Ute Growth Fund,
an Indian Tribal Fund ("</FONT><FONT SIZE=2><I>Southern Ute Growth</I></FONT><FONT SIZE=2>"), Southern Ute Permanent Fund, an Indian Tribal Fund (together with One Group Income, One Group High Yield
and Southern Ute Growth, "</FONT><FONT SIZE=2><I>Pacholder</I></FONT><FONT SIZE=2>"), Atlantic Global Funding&nbsp;Ltd., a Cayman Islands company
("</FONT><FONT SIZE=2><I>Atlantic</I></FONT><FONT SIZE=2>"), CHYPS 1997-1&nbsp;Ltd., a Cayman Islands company ("</FONT><FONT SIZE=2><I>CHYPS 1997</I></FONT><FONT SIZE=2>"), CHYPS
1999-1&nbsp;Ltd., a Cayman Islands company (collectively with Atlantic and CHYPS 1997, "</FONT><FONT SIZE=2><I>Delaware Investments</I></FONT><FONT SIZE=2>") (NIT, Pacholder and
Delaware Investments are collectively referred to herein as the "</FONT><FONT SIZE=2><I>Non-GOF Holders</I></FONT><FONT SIZE=2>"), James G. Boyd, in his individual capacity
("</FONT><FONT SIZE=2><I>Boyd</I></FONT><FONT SIZE=2>") and Jerry Zucker, in his individual capacity ("</FONT><FONT SIZE=2><I>Zucker</I></FONT><FONT SIZE=2>"). </FONT></P>

<P><FONT SIZE=2>In
consideration of the mutual promises and covenants contained in this Agreement, the parties hereto hereby agree as follows: </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>ARTICLE I<BR>
DEFINITIONS AND INTERPRETATION  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1
</FONT><FONT SIZE=2><I>Definitions and Interpretation</I></FONT><FONT SIZE=2>. </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Interpretation</I></FONT><FONT SIZE=2>. When a reference is made in this Agreement to Sections, Exhibits, Appendices or Schedules, such reference
shall be to a Section of or Exhibit, Appendix or Schedule to this Agreement unless otherwise indicated. The headings contained in this Agreement are for reference purposes only
and shall not affect in any way the meaning or interpretation of this Agreement. Whenever the words "include," "includes" or "including" are used in this Agreement, they shall be deemed to be followed
by the words "without limitation". The phrases "the date of this Agreement," "the date hereof" and terms of similar import, unless the context otherwise requires, shall be deemed to refer to
March&nbsp;5, 2003. Words used herein, regardless of the number and gender specifically used, shall be deemed and construed to include any other number, singular or plural, and any other gender,
masculine, feminine, or neuter, as the context requires. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Definitions</I></FONT><FONT SIZE=2>. When used in this Agreement, the following terms shall have the meanings set forth below (all terms used in
this Agreement that are not defined in this Article&nbsp;I shall have the meanings set forth elsewhere in this Agreement). </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2
"</FONT><FONT SIZE=2><I>Affiliate</I></FONT><FONT SIZE=2>" of any Person shall mean any Person, directly or indirectly, through one or more intermediaries, controlling, controlled
by, or under common control with such Person. The term "control," as used in the immediately preceding sentence, shall mean with respect to a corporation or limited liability company, the right to
exercise, directly or indirectly, more than fifty percent (50%) of the outstanding voting interests in the controlled corporation or limited liability company, and, with respect to any individual,
partnership, trust, other entity or association, the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of the controlled entity or the
actions of the individual, as the case may be. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3
"</FONT><FONT SIZE=2><I>Bennett</I></FONT><FONT SIZE=2>" shall have the meaning set forth in the first introductory paragraph hereto. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.4
"</FONT><FONT SIZE=2><I>Boyd</I></FONT><FONT SIZE=2>" shall have the meaning set forth in the first introductory paragraph hereto. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.5
"</FONT><FONT SIZE=2><I>Business Day</I></FONT><FONT SIZE=2>" shall mean any day that is not a Saturday, Sunday or other day on which banking institutions in New York, New York are
authorized or required by law or executive order to close. </FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.6
"</FONT><FONT SIZE=2><I>Bylaws</I></FONT><FONT SIZE=2>" shall mean the Bylaws of the Company dated as of March&nbsp;5, 2003, as the same may be amended from time to time.. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.7
"</FONT><FONT SIZE=2><I>Certificate of Incorporation</I></FONT><FONT SIZE=2>" shall mean the Amended and Restated Certificate of Incorporation of the Company, filed with the
Secretary of State of the State of Delaware on March&nbsp;5, 2003, as the same may be amended and restated from time to time. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.8
"</FONT><FONT SIZE=2><I>Change of Control</I></FONT><FONT SIZE=2>" shall mean the acquisition by any Person or group (as defined in Section&nbsp;13(d)(3) of the Exchange Act),
other than any GOF Party, of beneficial ownership (as defined in Section&nbsp;13(d) of the Exchange Act) of all or more than 50% of the assets of the Company and its Subsidiaries, taken as a whole,
or 50% or more of the voting equity of the Company pursuant to a merger, consolidation, other business combination, reorganization, restructuring, sale of equity (whether through a new issuance by the
Company or a transfer by a Shareholder), sale of assets, tender offer, exchange offer or similar transaction or series of transactions. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.9
"</FONT><FONT SIZE=2><I>Class&nbsp;A Common Stock</I></FONT><FONT SIZE=2>" shall mean the Class&nbsp;A Common Stock, par value $.01 per share, of the Company. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.10
"</FONT><FONT SIZE=2><I>Class&nbsp;B Common Stock</I></FONT><FONT SIZE=2>" shall mean the Class&nbsp;B Common Stock, par value $.01 per share, of the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.11
"</FONT><FONT SIZE=2><I>Class&nbsp;C Common Stock</I></FONT><FONT SIZE=2>" shall mean the Class&nbsp;C Common Stock, par value $.01 per share, of the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.12
"</FONT><FONT SIZE=2><I>Class&nbsp;D Common Stock</I></FONT><FONT SIZE=2>" shall mean the Class&nbsp;D Common Stock, par value $.01 per share, of the Company. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.13
"</FONT><FONT SIZE=2><I>Class&nbsp;E Common Stock</I></FONT><FONT SIZE=2>" shall mean the Class&nbsp;E Common Stock, par value $.01 per share, of the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.14
"</FONT><FONT SIZE=2><I>Common Stock</I></FONT><FONT SIZE=2>" shall collectively mean the Class&nbsp;A Common Stock, Class&nbsp;B Common Stock, Class&nbsp;C Common Stock,
Class&nbsp;D Common Stock, and Class&nbsp;E Common Stock. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.15
"</FONT><FONT SIZE=2><I>Company</I></FONT><FONT SIZE=2>" shall have the meaning set forth in the first introductory paragraph hereto. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.16
"</FONT><FONT SIZE=2><I>Company Tag-Along Notice</I></FONT><FONT SIZE=2>" shall have the meaning set forth in Section&nbsp;3.2. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.17
"</FONT><FONT SIZE=2><I>Convertible Notes</I></FONT><FONT SIZE=2>" shall mean the 10% convertible subordinated notes due December&nbsp;2007, to be issued by the Company on the
Effective Date in an aggregate principal amount of $50,000,000. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.18
"</FONT><FONT SIZE=2><I>CSFB</I></FONT><FONT SIZE=2>" shall mean Credit Suisse First Boston. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.19
"</FONT><FONT SIZE=2><I>DIA</I></FONT><FONT SIZE=2>" shall have the meaning set forth in the first introductory paragraph hereto. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.20
"</FONT><FONT SIZE=2><I>Effective Date</I></FONT><FONT SIZE=2>" shall have the meaning set forth in the first introductory paragraph hereto. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.21
"</FONT><FONT SIZE=2><I>Exchange Act</I></FONT><FONT SIZE=2>" shall mean the Securities Exchange Act of 1934 and the rules and regulations promulgated thereunder, as each may be
amended from time to time. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.22
"</FONT><FONT SIZE=2><I>Exempt Securities</I></FONT><FONT SIZE=2>" shall mean: (a)&nbsp;shares of Common Stock issuable upon conversion of the Convertible Notes;
(b)&nbsp;shares of Class&nbsp;B Common Stock issuable pursuant to the anti-dilution provisions of the Class&nbsp;B Common Stock upon conversion of the Convertible Notes as set forth
in Article&nbsp;IV, Section&nbsp;2(a)(x)&nbsp;of the Certificate of Incorporation; (c)&nbsp;equity securities of the Company issued in connection with (i)&nbsp;any acquisition of another
Person (other than an individual) by the Company or any Subsidiary of the Company by merger, stock purchase, purchase of all or substantially all of the assets, or other reorganization, or
(ii)&nbsp;the purchase of all or substantially all of the assets of another Person, in each case that is approved by a majority of the Board of Directors; (d)&nbsp;up to an aggregate of 4,000,000
shares of Common Stock (or related options) issued to employees, officers, directors, consultants, other persons performing services for the Company (including distributors and </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>2</FONT></P>

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sales representatives) and their respective Affiliates, in each case, pursuant to any stock option plan, or similar equity-based compensatory arrangement approved by a majority of the Board of
Directors; (e)&nbsp;shares of Common Stock issued in connection with any stock split, stock dividend, recapitalization or similar transaction by the Company; (f)&nbsp;shares of Common Stock issued
pursuant to a firm commitment underwritten public offering of the Company's Common Stock; (g)&nbsp;non-convertible debt securities or debt instruments; (h)&nbsp;shares of capital stock
issued pursuant to a rights offering made to all holders of Initial Common Stock in accordance with applicable Federal securities laws; (i)&nbsp;shares of Common Stock and other securities issuable
pursuant to the Plan; (j)&nbsp;shares of Common Stock issuable upon exercise of the Series&nbsp;A Warrants and the Series&nbsp;B Warrants; and (k)&nbsp;shares of capital stock issued pursuant
to an anti-takeover plan, takeover defense plan or "poison pill" in the form of a shareholder rights plan or similar plan adopted by the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.23
"</FONT><FONT SIZE=2><I>Expedited Issuance</I></FONT><FONT SIZE=2>" shall have the meaning set forth in Section&nbsp;2.3(a). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.24
"</FONT><FONT SIZE=2><I>Expedited Purchaser</I></FONT><FONT SIZE=2>" shall have the meaning set forth in Section&nbsp;2.3(a). </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.25
"</FONT><FONT SIZE=2><I>GOF Board Member</I></FONT><FONT SIZE=2>" shall have the meaning set forth in Section&nbsp;4.1. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.26
"</FONT><FONT SIZE=2><I>GOF Party</I></FONT><FONT SIZE=2>" shall mean GOF or any Affiliate of GOF. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.27
"</FONT><FONT SIZE=2><I>GOF Party Tag-Along Notice</I></FONT><FONT SIZE=2>" shall have the meaning set forth in Section&nbsp;3.2. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.28
"</FONT><FONT SIZE=2><I>Initial Common Stock</I></FONT><FONT SIZE=2>" shall mean the issued and outstanding shares of Common Stock that were issued (a)&nbsp;pursuant to the Plan,
(b)&nbsp;upon conversion of the Convertible Notes or exercise of the Warrants, (c)&nbsp;upon antidilution adjustments to the Class&nbsp;B Common Stock or Convertible Notes, or (d)&nbsp;upon
stock splits, stock dividends or otherwise, in each case, in respect of any of the securities set forth in clauses (a), (b)&nbsp;and (c)&nbsp;above. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.29
"</FONT><FONT SIZE=2><I>Initial Shareholders</I></FONT><FONT SIZE=2>" shall mean all of the beneficial owners of Initial Common Stock. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.30
"</FONT><FONT SIZE=2><I>Law</I></FONT><FONT SIZE=2>" shall mean any Federal, state, local or foreign statute, law, regulation, rule, ordinance or code. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.31
"</FONT><FONT SIZE=2><I>Non-GOF Board Member</I></FONT><FONT SIZE=2>" shall have the meaning set forth in Section&nbsp;4.1. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.32
"</FONT><FONT SIZE=2><I>Non-GOF Holder</I></FONT><FONT SIZE=2>" shall have the meaning set forth in the first introductory paragraph hereto. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.33
"</FONT><FONT SIZE=2><I>Noteholder Counsel</I></FONT><FONT SIZE=2>" shall mean counsel, to the holders of Convertible Notes and/or Initial Common Stock issued upon conversion
thereof in connection with any registration pursuant to Section&nbsp;5.5, which Noteholder Counsel shall be chosen by GOF; provided that if GOF and its Affiliates shall not hold at least fifty
percent of the Initial Common Stock issuable upon conversion of the Convertible Notes (calculated assuming the conversion of all outstanding Convertible Notes), Noteholder Counsel shall be chosen by
the Non-GOF Holders holding at least fifty percent of the Initial Common Stock issuable upon conversion of the Convertible Notes held by all Non-GOF Holders (calculated
assuming the conversion of all outstanding Convertible Notes); provided, further, that such counsel shall be reasonably satisfactory to the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.34
"</FONT><FONT SIZE=2><I>Notice of Acceptance</I></FONT><FONT SIZE=2>" shall mean a written notice, in a form proscribed by the Company (which form may, at the Company's reasonable
discretion, include purchaser representations and warranties and other terms and provisions customary for transactions of such type, including without limitation, representations and warranties as to
such Initial Shareholder's title to the Common Stock and authority to purchase the Preemptive Securities) delivered by an Initial Shareholder or his nominee to the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.35
"</FONT><FONT SIZE=2><I>Oversubscription Shares</I></FONT><FONT SIZE=2>" shall mean the number of Preemptive Securities (determined on an as exercised or as converted basis)
initially offered in accordance with Section&nbsp;2.2 and 2.3 that Initial </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>3</FONT></P>

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<BR>

<P><FONT SIZE=2>
Shareholders fail to elect to exercise their right to purchase pursuant thereto (excluding elections by Initial Shareholders to purchase Oversubscription Shares). </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.36
"</FONT><FONT SIZE=2><I>Participating Shareholder</I></FONT><FONT SIZE=2>" shall have the meaning set forth in Section&nbsp;3.2(b). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.37
"</FONT><FONT SIZE=2><I>Person</I></FONT><FONT SIZE=2>" shall mean an individual, partnership, limited partnership, limited liability partnership, limited liability company,
corporation, trust, estate, association, custodian, trustee, executor, administrator, nominee or any other entity. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.38
"</FONT><FONT SIZE=2><I>PGI Affiliate</I></FONT><FONT SIZE=2>" shall mean (a)&nbsp;GOF, (b)&nbsp;Boyd, (c)&nbsp;Zucker, (d)&nbsp;CSFB, (e)&nbsp;any Insider (as defined in
11 U.S.C. sec 101) of GOF, Boyd, Zucker or CSFB, (f)&nbsp;the Intertech Group,&nbsp;Inc., (g)&nbsp;the GTC Fund III Limited Partnership and (h)&nbsp;any other entity directly or indirectly
controlling or controlled by or under direct or indirect common control with GOF, Boyd, Zucker or CSFB, where control means the power to direct the management or policies of such entity, directly or
indirectly; provided that nothing in this definition shall be an admission that any such entity is an "affiliate" of the Company for any purpose other than for the purpose of defining PGI Affiliate in
this Agreement. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.39
"</FONT><FONT SIZE=2><I>Plan</I></FONT><FONT SIZE=2>" shall mean the Debtors' Joint Second Amended Modified Plan of Reorganization, dated January&nbsp;16, 2003. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.40
"</FONT><FONT SIZE=2><I>Post-Issuance Offer Notice</I></FONT><FONT SIZE=2>" shall have the meaning set forth in Section&nbsp;2.3(a). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.41
"</FONT><FONT SIZE=2><I>Preemptive Securities</I></FONT><FONT SIZE=2>" shall have the meaning set forth in Section&nbsp;2.1. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.42
"</FONT><FONT SIZE=2><I>Pre-Issuance Offer Notice</I></FONT><FONT SIZE=2>" shall have the meaning set forth in Section&nbsp;2.2(a). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.43
"</FONT><FONT SIZE=2><I>Securities Act</I></FONT><FONT SIZE=2>" shall mean the Securities Act of 1933, as the same may be amended from time to time. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.44
"</FONT><FONT SIZE=2><I>Series&nbsp;A Warrants</I></FONT><FONT SIZE=2>" shall mean the Series&nbsp;A Warrants to purchase shares of Class&nbsp;D Common Stock, par value $.01
per share, which warrants shall be issued by the Company as of the Effective Date. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.45
"</FONT><FONT SIZE=2><I>Series&nbsp;B Warrants</I></FONT><FONT SIZE=2>" shall mean the Series&nbsp;B Warrants to purchase shares of Class&nbsp;E Common Stock, par value $.01
per share, which warrants shall be issued by the Company as of the Effective Date. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.46
"</FONT><FONT SIZE=2><I>Shareholders</I></FONT><FONT SIZE=2>" shall mean all of the beneficial owners of issued and outstanding Common Stock. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.47
"</FONT><FONT SIZE=2><I>Shareholder Tag-Along Acceptance Notice</I></FONT><FONT SIZE=2>" shall mean a written notice, in a form proscribed by the GOF Party proposing to
sell Subject Shares (which form may, at such GOF Party's reasonable discretion, include seller representations and warranties and other terms and provisions customary for transactions of such type,
including without limitation, representations and warranties as to such Initial Shareholder's title to the Common Stock and authority to sell the same) delivered by an Initial Shareholder or his
nominee to the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.48
"</FONT><FONT SIZE=2><I>Subject Shares</I></FONT><FONT SIZE=2>" shall have the meaning set forth in Section&nbsp;3.1. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.49
"</FONT><FONT SIZE=2><I>Subsidiary</I></FONT><FONT SIZE=2>" shall mean, with respect to any Person, any corporation, partnership, limited partnership, limited liability
partnership, limited liability company or other legal entity in which such Person (either directly or indirectly through or together with other Subsidiaries) owns more than 50% of the voting
securities of such corporation, partnership, limited liability company or other legal entity. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.50
"</FONT><FONT SIZE=2><I>Tag-Along Shares</I></FONT><FONT SIZE=2>" shall have the meaning set forth in Section&nbsp;3.2(b). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.51
"</FONT><FONT SIZE=2><I>Third Party</I></FONT><FONT SIZE=2>" shall have the meaning set forth in Section&nbsp;3.1. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.52
"</FONT><FONT SIZE=2><I>Warrants</I></FONT><FONT SIZE=2>" shall mean the Series&nbsp;A Warrants and Series&nbsp;B Warrants. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>4</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.53
"</FONT><FONT SIZE=2><I>ZB Board Member</I></FONT><FONT SIZE=2>" shall have the meaning set forth in Section&nbsp;4.1. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>ARTICLE II<BR>
PREEMPTIVE RIGHTS  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1
</FONT><FONT SIZE=2><I>Preemptive Rights</I></FONT><FONT SIZE=2>. Except for issuances of Exempt Securities, the Company will not issue any shares of capital stock of the Company
and will not issue or grant any options, warrants, conversion rights or other rights to purchase or acquire any shares of capital stock of the Company (collectively,
"</FONT><FONT SIZE=2><I>Preemptive Securities</I></FONT><FONT SIZE=2>") without compliance with Section&nbsp;2.2; </FONT><FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT> <FONT SIZE=2><I>however</I></FONT><FONT SIZE=2>, that the Company may
issue Preemptive Securities solely to Initial Shareholders without compliance with Section&nbsp;2.2 if the Company
complies with Section&nbsp;2.3. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2
</FONT><FONT SIZE=2><I>Offer Prior to Issuance</I></FONT><FONT SIZE=2>. </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;Prior
to any issuance of any Preemptive Securities, the Company (directly or through its agent) shall deliver to each Initial Shareholder that is the record holder of
Initial Common Stock and each broker, dealer, trust company, commercial bank and other nominee that is the record holder of Initial Common Stock, in each case, as of a record date set by the Company
for such purpose, a written notice of any proposed or intended issuance of Preemptive Securities (the "</FONT><FONT SIZE=2><I>Pre-Issuance Offer Notice</I></FONT><FONT SIZE=2>"), which
Pre-Issuance Offer Notice shall (a)&nbsp;identify and describe the Preemptive Securities proposed or intended to be issued, (b)&nbsp;disclose the number, price and other terms upon
which they are to be issued, (c)&nbsp;indicate the procedure for each Initial Shareholder to offer to purchase such Initial Shareholder's initial pro rata portion (determined in accordance with this
Section&nbsp;2.2(a)) of such Preemptive Securities and such Initial Shareholder's pro rata portion of Oversubscription Shares, and (d)&nbsp;include a deadline for Initial Shareholders or their
respective nominees, as the case may be, to deliver a Notice of Acceptance and payment of the purchase price for such Initial Shareholder's initial pro rata portion of Preemptive Securities and any
Oversubscription Shares sought to be purchased thereby to the Company (or its agent), which deadline shall in no event be later than thirty (30)&nbsp;calendar days or earlier than ten
(10)&nbsp;Business Days after the date of the Pre-Issuance Offer Notice; </FONT><FONT SIZE=2><I>provided </I></FONT><FONT SIZE=2>that such deadline may be later than thirty
(30)&nbsp;calendar days after the date of the Pre-Issuance Offer Notice if (i)&nbsp;GOF consents thereto in writing, or (ii)&nbsp;outside legal counsel to the Company (which counsel
shall be reasonably satisfactory to GOF) provides a written opinion addressed to the Company to the effect that a later deadline is required for the Company to comply with a Law applicable to the
Company. An Initial Shareholder shall not be entitled to purchase Oversubscription Shares unless such Initial Shareholder has purchased its full amount of its initial pro rata portion of Preemptive
Securities. For purposes of this Section&nbsp;2.2, an Initial Shareholder's initial pro rata portion of Preemptive Securities shall be determined by multiplying (x)&nbsp;the number of Preemptive
Securities (determined on an as exercised or as converted basis) proposed to be issued by (y)&nbsp;a fraction, the numerator of which is the aggregate number of issued and outstanding shares of
Initial Common Stock then beneficially owned by such Initial Shareholder, and the denominator of which is the aggregate number of issued and outstanding shares of Initial Common Stock then
beneficially owned by all Initial Shareholders. For the purposes of
this Section&nbsp;2.2, an Initial Shareholder's pro rata portion of Oversubscription Shares shall equal the product of (a)&nbsp;the Oversubscription Shares in such offering multiplied by
(b)&nbsp;a fraction, the numerator of which is the aggregate number of issued and outstanding shares of Initial Common Stock then beneficially owned by such Initial Shareholder, and the denominator
of which is the aggregate number of issued and outstanding shares of Initial Common Stock then beneficially owned by all Initial Shareholders who elected to (i)&nbsp;purchase their full initial pro
rata portion of Preemptive Securities and (ii)&nbsp;purchase Oversubscription Shares. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;To
purchase its pro rata portion of any Preemptive Securities to be issued by the Company and any Oversubscription Shares, an Initial Shareholder or his broker, dealer,
trust </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>5</FONT></P>

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company, commercial bank or other nominee must deliver a Notice of Acceptance, along with a certified check (or other form of payment approved by the Company) for the purchase price for such
Preemptive Securities (including any Oversubscription Shares), to the Company (or its agent) in accordance with the instructions set forth on the Notice of Acceptance prior to the deadline set forth
in the Pre-Issuance Offer Notice. The Company shall issue to each Initial Shareholder that has timely returned a properly completed Notice of Election, along with a certified check (or
other means of payment approved by the Company) for the purchase price, the applicable number of Preemptive Securities and Oversubscription Shares in accordance with the terms set forth in the
Pre-Issuance Offer Notice. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;In
the event that the Company complies with the procedures set forth in this Section&nbsp;2.2 and not all of the Preemptive Securities are accepted for purchase (after
taking into account all Oversubscription Shares sought to be purchased by Initial Shareholders), the Company shall have 180&nbsp;days from the date of the deadline set forth in the applicable
Pre-Issuance Offer Notice to issue or sell all or any part of the Preemptive Securities as to which a Notice of Acceptance has not timely been given by the Initial Shareholders to any
other purchaser or purchasers (including Initial Shareholders or their Affiliates) upon the terms and conditions (including the per share price) which are not more favorable to the purchaser than
those set forth in the Pre-Issuance Offer Notice. Any Preemptive Securities not acquired by the Initial Shareholders or any other purchaser or purchasers prior to the date that is
180&nbsp;days after the deadline set forth in the applicable Pre-Issuance Offer Notice may not be issued until they are again offered to the Initial Shareholders under the procedures
specified in this Section&nbsp;2.2 or Section&nbsp;2.3. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3
</FONT><FONT SIZE=2><I>Offer After Issuance</I></FONT><FONT SIZE=2>. </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;Subject
to this Section&nbsp;2.3(a), the Company may issue to one or more Initial Shareholders (or an Affiliate thereof) (each an "</FONT><FONT SIZE=2><I>Expedited
Purchaser</I></FONT><FONT SIZE=2>"), without compliance with the procedures set forth in Section&nbsp;2.2, such Initial Shareholders' initial pro rata portion (as determined in accordance with the
last sentence of this Section&nbsp;2.3(a)) of the total amount of Preemptive Securities proposed to be issued by the Company (an "</FONT><FONT SIZE=2><I>Expedited
Issuance</I></FONT><FONT SIZE=2>"). In such event, the Company (directly or through its agent) shall, as soon as reasonably practicable after an Expedited Issuance, deliver to each Initial Shareholder
that is the record holder of Initial Common Stock and each broker, dealer, trust company, commercial bank and other nominee that is the record holder of Initial Common Stock, in each case, as of a
record date set by the Company for such purpose, a written notice of the issuance of Preemptive Securities
(the "</FONT><FONT SIZE=2><I>Post-Issuance Offer Notice</I></FONT><FONT SIZE=2>"), which Post-Issuance Offer Notice shall (a)&nbsp;identify and describe the Preemptive
Securities that were issued, and disclose the date of such Expedited Issuance, (b)&nbsp;disclose the number, price and other terms upon which they were issued, (c)&nbsp;indicate the procedure for
each Initial Shareholder to purchase such Initial Shareholder's initial pro rata portion (determined in accordance with this Section&nbsp;2.3(a)) of such Preemptive Securities and such Initial
Shareholder's pro rata portion of Oversubscription Shares on the same terms as in such Expedited Issuance, and (d)&nbsp;include a deadline of not less than thirty (30)&nbsp;calendar days for such
Initial Shareholders or their respective nominees, as the case may be, to deliver a Notice of Acceptance and payment of the purchase price for such Initial Shareholder's initial pro rata portion of
Preemptive Securities and any Oversubscription Shares sought to be purchased to the Company (or its agent). An Initial Shareholder shall not be entitled to purchase Oversubscription Shares unless such
Initial Shareholder has purchased its full amount of its initial pro rata portion of Preemptive Securities. For purposes of this Section&nbsp;2.3(a), an Initial Shareholder's initial pro rata
portion of Preemptive Securities shall equal (x)&nbsp;the sum of the number of Preemptive Securities proposed to be issued (or issued) by the Company in the Expedited Issuance, determined on an as
exercised or as converted basis, plus the additional number of Preemptive Securities proposed to be issued by the Company, determined on an as exercised or as converted basis, multiplied by
(y)&nbsp;a fraction, the </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>6</FONT></P>

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numerator of which is the aggregate number of issued and outstanding shares of Initial Common Stock beneficially owned by such Initial Shareholder immediately prior to the Expedited Issuance, and the
denominator of which is the aggregate number of issued and outstanding shares of Initial Common Stock beneficially owned by all Initial Shareholders immediately prior to the Expedited Issuance. For
the purposes of this Section&nbsp;2.3, an Initial Shareholder's pro rata portion of Oversubscription Shares shall equal the product of (a)&nbsp;the Oversubscription Shares in such offering
multiplied by (b)&nbsp;a fraction, the numerator of which is the aggregate number of issued and outstanding shares of Initial Common Stock beneficially owned by such Initial Shareholder immediately
prior to the Expedited Issuance, and the denominator of which is the aggregate number of issued and outstanding shares of Initial Common Stock beneficially owned immediately prior to the Expedited
Issuance by all Initial Shareholders who elected to (i)&nbsp;purchase their full initial pro rata portion of Preemptive Securities and (ii)&nbsp;purchase Oversubscription Shares. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;To
purchase its pro rata portion of Preemptive Securities and any Oversubscription Shares, an Initial Shareholder (other than the Expedited Purchasers) or such Initial
Shareholder's broker, dealer, trust company, commercial bank or other nominee must deliver a Notice of Acceptance, along with a certified check (or other form of payment approved by the Company) for
the purchase price for such Preemptive Securities (including any Oversubscription Shares), to the Company (or its agent) in accordance with the instructions set forth on the Notice of Acceptance prior
to the deadline set forth in the Post-Issuance Offer Notice. The Company shall issue to each Initial Shareholder that has timely returned a properly completed Notice of Election, along
with a certified check (or other means of payment approved by the Company) for the purchase price, the applicable number of Preemptive Securities and any Oversubscription Shares in accordance with the
terms set forth in the Post-Issuance Offer Notice. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4
</FONT><FONT SIZE=2><I>Non-Material Variation of Procedures</I></FONT><FONT SIZE=2>. The Company, with the approval of its Board of Directors, including at least one
Non-GOF Board Member, and the written consent of GOF, may alter the procedures set forth in Sections 2.2 and 2.3 to the extent required to comply with any applicable Law or as is otherwise
advisable; </FONT><FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT><FONT SIZE=2><I>however</I></FONT><FONT SIZE=2>, that no alteration to the procedures set forth in Sections
2.2 or 2.3 may be made in the manner set forth in this Section&nbsp;2.4 if such alteration would result in a material adverse effect on the preemptive rights provided in this Article&nbsp;II. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5
</FONT><FONT SIZE=2><I>Waiver</I></FONT><FONT SIZE=2>. The Company may issue Preemptive Securities without compliance with the terms and provisions of Sections 2.2 and 2.3 with the
prior consent of both (a)&nbsp;the Board of Directors of the Company, including at least one Non-GOF Board Member, and (b)&nbsp;GOF. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.6
</FONT><FONT SIZE=2><I>Termination</I></FONT><FONT SIZE=2>. The terms and provisions of this Article&nbsp;II shall terminate upon the earlier of (a)&nbsp;a Change of Control or
(b)&nbsp;the consent of both (i)&nbsp;the Board of Directors of the Company, including at least one Non-GOF Board Member, and (ii)&nbsp;GOF. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>ARTICLE III<BR>
TAG-ALONG RIGHTS  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1
</FONT><FONT SIZE=2><I>Tag-Along Rights</I></FONT><FONT SIZE=2>. The GOF Parties will not sell any shares of Common Stock to any Person that is not a GOF Party (a
"</FONT><FONT SIZE=2><I>Third Party</I></FONT><FONT SIZE=2>") without compliance with the terms of this Article&nbsp;III; </FONT><FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT> <FONT SIZE=2><I>however</I></FONT><FONT SIZE=2>, that the terms
and provisions of this Article&nbsp;III shall not be applicable to any sale by a GOF Party if (a)&nbsp;prior to and after
giving effect to such sale the GOF Parties shall beneficially own at least an aggregate of 54.9% of the Common Stock of the Company, assuming the exercise, conversion and exchange of all securities
immediately exercisable, convertible or exchangeable for Common Stock on the date of determination, or (b)&nbsp;the GOF Party's sale to a Third Party is in connection with a tender offer by such
Third Party open to all holders of Initial Common Stock and in accordance with the requirements of applicable Federal securities laws. All shares of Common Stock proposed to be sold by a GOF Party and
not excluded from the terms and provisions of this Article&nbsp;III </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>7</FONT></P>

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<P><FONT SIZE=2>
pursuant to the proviso of the immediately preceding sentence are referred to herein as "</FONT><FONT SIZE=2><I>Subject Shares</I></FONT><FONT SIZE=2>". </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2
</FONT><FONT SIZE=2><I>Procedures</I></FONT><FONT SIZE=2>. </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;Prior
to the sale of any Subject Shares to a Third Party, the GOF Party shall deliver to the Company a written notice of the proposed or intended sale of Subject Shares
(the "</FONT><FONT SIZE=2><I>GOF Party Tag-Along Notice</I></FONT><FONT SIZE=2>"), which GOF Party Tag-Along Notice shall (a)&nbsp;identify the Subject Shares proposed or
intended to be sold, and (b)&nbsp;disclose the number, price and other terms upon which they are to be sold. Within three (3)&nbsp;Business Days of the receipt of the GOF Party
Tag-Along Notice, the Company shall set a record date for the determination of Initial Shareholders entitled to exercise tag-along rights with respect to the Subject Shares
identified in the GOF Party Tag-Along Notice (which record date shall not
be more than 15 calendar days after the receipt of the GOF Party Tag-Along Notice) and, within two Business Days of such record date, the Company (directly or through its agent) shall take
all steps necessary and/or advisable (including preparing necessary and/or advisable documentation and making all necessary and/or advisable filings with the U.S. Securities and Exchange Commission
and any other governmental authority) to deliver to each Initial Shareholder that is the record holder of Common Stock and each broker, dealer, trust company, commercial bank and other nominee that is
the record holder of Common Stock, in each case, as of the record date set by the Company, a written notice of the proposed or intended sale of Subject Shares (the "</FONT><FONT SIZE=2><I>Company
Tag-Along Notice</I></FONT><FONT SIZE=2>"). The Company Tag-Along Notice shall be satisfactory in all respects to GOF and shall (a)&nbsp;identify the Subject Shares proposed
or intended to be sold, (b)&nbsp;disclose the number, price and other terms upon which they are to be sold, (c)&nbsp;inform each Initial Shareholder of his right to sell such Initial Shareholder's
pro rata portion (determined in accordance with the last sentence of this Section&nbsp;3.2) of shares of Common Stock along with the GOF Party to the Third Party, (d)&nbsp;include all other
information, disclosures, statements and documents as may be required by Law (which information, disclosures, statements and documents shall be reasonably satisfactory to GOF), and (e)&nbsp;include
a deadline for Initial Shareholders or their respective nominees, as the case may be, to deliver a Shareholder Tag-Along Acceptance Notice, along with the shares of Common Stock to be
sold, to GOF (or its agent) in accordance with the terms of the Shareholder Tag-Along Acceptance Notice, which deadline shall in no event be later than thirty (30)&nbsp;calendar days or
earlier than ten (10)&nbsp;Business Days after the date of the Company Tag-Along Notice; </FONT><FONT SIZE=2><I>provided </I></FONT><FONT SIZE=2>that such deadline may be later than
thirty (30)&nbsp;calendar days after the date of the Company Tag-Along Notice if (i)&nbsp;GOF consents thereto in writing, or (ii)&nbsp;outside legal counsel to the Company (which
counsel shall be reasonably satisfactory to GOF) provides a written opinion addressed to the Company to the effect that a later deadline is required for the Company to comply with a Law applicable to
the Company. The Company shall enclose a sufficient number of Shareholder Tag-Along Acceptance Notices with each Company Tag-Along Notice. For purposes of this
Section&nbsp;3.2, an Initial Shareholder's pro rata portion shall be determined by multiplying (x)&nbsp;the number of Subject Shares proposed to be sold to a Third Party by (y)&nbsp;a fraction,
the numerator of which is the aggregate number of issued and outstanding shares of Initial Common Stock then beneficially owned by such Initial Shareholder, and the denominator of which is the
aggregate number of shares of Initial Common Stock then issued and outstanding. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;To
sell his pro rata portion of shares of Common Stock along with the GOF Party to the Third Party each Initial Shareholder or his broker, dealer, trust company,
commercial bank or other nominee must (a)&nbsp;deliver a Shareholder Tag-Along Acceptance Notice, along with the shares of Common Stock to be sold, to GOF (or its agent) in accordance
with the instructions set forth on the Shareholder Tag-Along Acceptance Notice; and (b)&nbsp;comply with any other applicable terms of the proposed sale (including executing definitive
documentation and any related documents), in each case, prior to the deadline set forth in the Company Tag-Along Notice (an Initial Shareholder </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>8</FONT></P>

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<P><FONT SIZE=2>
satisfying such requirements shall be referred to herein as a "</FONT><FONT SIZE=2><I>Participating Shareholder</I></FONT><FONT SIZE=2>"). Upon compliance with the foregoing procedures, the GOF
Party may sell the Subject Shares (less the number of Tag-Along Shares (as defined below)) for a period of up to 180&nbsp;days after the deadline set forth in the Company
Tag-Along Notice, upon terms and conditions (including the per share price) which are not more favorable to the GOF Party, in the aggregate, than those set forth in the GOF
Tag-Along Notice; </FONT><FONT SIZE=2><I>provided </I></FONT><FONT SIZE=2>that such sale provides for the purchase of each Participating Shareholders pro rata portion of Common Stock (the
"</FONT><FONT SIZE=2><I>Tag-Along Shares</I></FONT><FONT SIZE=2>") on terms and conditions no less favorable than those set forth in the GOF Tag-Along Notice. Any Subject
Shares not sold by the GOF Party prior to the date that is 180&nbsp;days after the deadline set forth in the Company Party Tag-Along Notice may not be sold without compliance with this
Section&nbsp;3.2. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;Promptly
(but in no event later than three (3)&nbsp;Business Days) after the consummation of the sale of Subject Shares by a GOF Party to a Third Party, the GOF Party
shall (i)&nbsp;notify the Company of such sale, and (ii)&nbsp;cause to be remitted to the Company the total sales proceeds attributable to the sale of Tag-Along Shares. Thereafter the
Company (directly or through its agent) shall promptly distribute such sales proceeds to the applicable Initial Shareholders. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1
</FONT><FONT SIZE=2><I>Non-Material Variation of Procedures</I></FONT><FONT SIZE=2>. The Company, with the approval of its Board of Directors, including at </FONT> <FONT SIZE=2><I>least </I></FONT><FONT SIZE=2>one Non-GOF Board Member, and the
written consent of GOF, may alter the procedures set forth in Section&nbsp;3.2 to the extent
required to comply with any applicable Law or as is otherwise advisable; </FONT><FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT><FONT SIZE=2><I>however</I></FONT><FONT SIZE=2>, that no
alteration to the procedures set forth in Section&nbsp;3.2 may be made in the manner set forth in this Section&nbsp;3.3 if such alteration would result in a material adverse effect on the
tag-along rights provided in this Article&nbsp;III. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2
</FONT><FONT SIZE=2><I>Waiver</I></FONT><FONT SIZE=2>. A GOF Party may sell Subject Shares without compliance with the terms and provisions of </FONT><FONT SIZE=2><I>Sections 3.2  </I></FONT><FONT SIZE=2>with the prior consent of both (a)&nbsp;the
Board of Directors of the Company, including at least one Non-GOF Board Member, and (b)&nbsp;GOF. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3 </FONT> <FONT SIZE=2><I>Termination</I></FONT><FONT SIZE=2>. The terms and provisions of this Article&nbsp;III shall terminate upon the earlier of (a)&nbsp;a Change of Control or
(b)&nbsp;the consent of both (i)&nbsp;the Board of Directors of the Company, including at least one Non-GOF Board Member, and (ii)&nbsp;GOF. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>ARTICLE IV<BR>
BOARD OF DIRECTORS  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1
</FONT><FONT SIZE=2><I>Number, Term, and Qualifications</I></FONT><FONT SIZE=2>. </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Initial Board of Directors</I></FONT><FONT SIZE=2>. Pursuant to the Plan and this Agreement, on the Effective Date, the Company's Board of
Directors shall be (a)&nbsp;fixed at nine (9)&nbsp;members, each with one year terms, subject to the removal provisions of the Company's Bylaws, and (b)&nbsp;composed of five
(5)&nbsp;directors designated by GOF (together with any direct or indirect successors thereto designated by GOF, the "</FONT><FONT SIZE=2><I>GOF Board Members</I></FONT><FONT SIZE=2>"), two
(2)&nbsp;directors designated by the pre-Effective Date Board of Directors of the Company, who shall be Zucker and Boyd (together with any direct or indirect successors thereto, the
"</FONT><FONT SIZE=2><I>ZB Board Members</I></FONT><FONT SIZE=2>"), and two (2)&nbsp;directors designated by the Non-GOF Holders (together with any direct or indirect successors
thereto, the "</FONT><FONT SIZE=2><I>Non-GOF Board Members</I></FONT><FONT SIZE=2>"). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Subsequent Elections</I></FONT><FONT SIZE=2>. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At
the annual meeting of stockholders for the calendar years 2003, 2004 and 2005, GOF, each Non-GOF Holder, Zucker (as long as he is a director) and Boyd (as long as he is a
director) each shall vote or cause to be voted all shares of Common Stock and other voting equity owned by him or it, or over which he or it has voting control, and otherwise use its respective best
efforts, so as to nominate and elect to the Board of Directors the GOF Board Members, Non-GOF Board Members and ZB Board Members sitting on the Board of Directors on the date immediately </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>9</FONT></P>

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preceding such meeting; provided that if there shall be any vacancy on the Board of Directors on the date immediately preceding such meeting as the result of the removal, resignation, death,
disability or otherwise of a GOF Board Member, Non-GOF Board Member or ZB Board Member, GOF, each Non-GOF Holder, Zucker and Boyd each shall vote or cause to be voted all
shares of Common Stock and other voting equity owned by him or it, or over which he or it has voting control, and otherwise use its respective best efforts, so as to nominate and elect a successor
designated by GOF, if the director was a GOF Board Member, designated by the remaining Non-GOF Board Member, if the director was a Non-GOF Board Member and designated by the
remaining ZB Board Member, if the director was a ZB Board Member; provided that (i)&nbsp;GOF shall not be required to vote, or cause to be voted, the shares of Common Stock or other voting equity
owned by it or over which it has voting control, or use its best efforts, to nominate or elect any proposed director if such proposed director was previously removed from the Board of Directors in
accordance with the terms of this Agreement, and (ii)&nbsp;upon the removal of any ZB Board Member pursuant to Sections 4.2(c) or (d), the remaining ZB Board Member shall not have the right to
designate a successor to the removed ZB Board Member. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2
</FONT><FONT SIZE=2><I>Vacancies</I></FONT><FONT SIZE=2>. </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;At
any time prior to the third (3rd) anniversary of the Effective Date, upon the vacancy of any director due to resignation, removal or otherwise, GOF, each
Non-GOF Holder, Zucker and Boyd each shall vote or cause to be voted all shares of Common Stock and other voting equity owned by him or it, or over which he or it has voting control, and
otherwise use its respective best efforts, so as to nominate and elect a successor designated by GOF, if the director was a GOF Board Member, designated by the remaining Non-GOF Board
Member, if the director was a Non-GOF Board Member and designated by the remaining ZB Board Member, if the director was a ZB Board Member; provided that (i)&nbsp;GOF shall not be
required to vote, or cause to be voted, the shares of Common Stock or other voting equity owned by it or over which it has voting control, or use its best efforts, to nominate or elect any proposed
director if such proposed director was previously removed from the Board of Directors in accordance with the terms of this Agreement, and (ii)&nbsp;upon the removal of any ZB Board Member pursuant
to Sections 4.2(c) or (d), the remaining ZB Board Member shall not have the right to designate a successor to the removed ZB Board Member. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;At
any time on or after the third (3rd) anniversary of the Effective Date, GOF, each Non-GOF Holder, Zucker and Boyd shall each vote or cause to be voted all
shares of Common Stock and other voting equity owned by him or it, or over which he or it has voting control, so as to nominate, include on the Company's slate of directors and elect each GOF Board
Member, ZB Board Member and
Non-GOF Board Member that served on the Board of Directors immediately prior to such election and/or each other Shareholder nominee; provided that in the case of each such specific
nomination (i)&nbsp;such GOF Board Member, ZB Board Member, Non-GOF Board Member or other Shareholder nominee has been properly nominated by a Shareholder, and (ii)&nbsp;the nomination
thereof has the support of the affirmative vote of at least 12.5% of the issued and outstanding shares of Common Stock; provided, further that each share of Common Stock may be counted in support of
only one nominee; provided further that in no event shall the size of the Company's Board of Directors be increased by operation of this Section&nbsp;4.2(b). </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>10</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;GOF
shall not vote, or cause to be voted, the shares of Common Stock or other voting equity owned by it, or over which it has voting control, to remove Zucker or any ZB
Board Member that is a direct or indirect successor thereto from the Board of Directors without cause unless (i)&nbsp;Zucker's employment with the Company or its Subsidiaries is terminated for
cause, or (ii)&nbsp;(A)&nbsp;Zucker's employment with the Company or its Subsidiaries is terminated without cause or Zucker resigns and (B)&nbsp;the Company tenders or otherwise pays to Zucker
the amounts that he is entitled to receive under his letter agreement dated May&nbsp;22, 1998, as amended on May&nbsp;11, 2002 (as the same may be amended from time to time, the "Zucker Change of
Control Agreement") or any other applicable agreement; provided, however, that during the pendency of any dispute relating to (I)&nbsp;Zucker's termination of employment, (II)&nbsp;whether such
termination of employment is for cause, or (III)&nbsp;whether Zucker is entitled to payment under the Zucker Change of Control Agreement or any other applicable agreement, GOF shall be permitted to
vote, and cause to be voted, the shares of Common Stock or other voting equity owned by it, and over which it has voting control, to remove Zucker (or any ZB Board Member that is a direct or indirect
successor thereto) from the Board of Directors. Nothing in this Section&nbsp;4.2(c) shall limit GOF's right to vote, or cause to be voted, the shares of Common Stock or other voting equity owned by
it, or over which it has voting control, to remove for cause Zucker or any ZB Board Member that is a direct or indirect successor thereto from the Board of Directors. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;GOF
shall not vote, or cause to be voted, the shares of Common Stock or other voting equity owned by it, or over which it has voting control, to remove Boyd or any ZB
Board Member that is a direct or indirect successor thereto from the Board of Directors without cause unless (i)&nbsp;Boyd's employment with the Company or its Subsidiaries is terminated for cause,
or (ii)&nbsp;(A)&nbsp;Boyd's employment with the Company or its Subsidiaries is terminated without cause or Boyd resigns and (B)&nbsp;the Company tenders or otherwise pays Boyd the amounts that
he is entitled to receive under his letter agreement dated May&nbsp;22, 1998, as amended on May&nbsp;11, 2002 (as the same may be amended from time to time, the "Boyd Change of Control Agreement")
or any other applicable agreement; provided, however, that during the pendency of any dispute relating to (I)&nbsp;Boyd's termination of employment, (II)&nbsp;whether such termination of
employment is for cause, or (III)&nbsp;whether Boyd is entitled to payment under the Boyd Change of Control Agreement or any other applicable agreement, GOF shall be permitted to vote, and cause to
be voted, the shares of Common Stock or other voting equity owned by it, and over which it has voting control, to remove Boyd (or any ZB Board Member that is a direct or indirect successor thereto)
from the Board of Directors. Nothing in this Section&nbsp;4.2(d) shall limit GOF's right to vote, or cause to be voted, the shares of Common Stock or other voting equity owned by it, or over which
it has voting control, to remove for cause Boyd or any ZB Board Member that is a direct or indirect successor thereto from the Board of Directors. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;If
a ZB Board Member is removed as a director for cause or otherwise in accordance with Section&nbsp;4.2(c) or (d), the Company promptly shall call a special meeting
of shareholders for the purpose of reducing the number of directors on the Company's Board of Directors to eliminate the vacancy created by such removal and GOF shall, at such special meeting, vote,
and cause to be voted, the
shares of Common Stock or other voting equity owned by it, or over which it has voting control, in favor of reducing the number of directors on the Company's Board of Directors to eliminate such
vacancy; provided, however, that (i)&nbsp;during the pendency of any dispute described in the proviso of Section&nbsp;4.2(c)(ii), GOF shall not vote, or cause to be voted, the shares of Common
Stock or other voting equity owned by it, or over which it has voting control in favor of either the elimination of the vacancy created by the removal of Zucker or any ZB Board Member that is a direct
or indirect successor thereto or the election of any director to fill such vacancy, and (ii)&nbsp;during the pendency of any dispute described in the proviso of Section&nbsp;4.2(d)(ii), GOF shall
not vote, or cause to be voted, the shares of Common Stock or other voting equity owned by it, or over which it has voting control in favor of either the elimination of the vacancy </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>11</FONT></P>

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<P><FONT SIZE=2>
created by the removal of Boyd or any ZB Board Member that is a direct or indirect successor thereto or the election of any director to fill such vacancy. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;GOF
shall not vote, or cause to be voted, the shares of Common Stock or other voting equity owned by it, or over which it has voting control, to remove without cause any
Non-GOF Board Member. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3 </FONT> <FONT SIZE=2><I>Committees</I></FONT><FONT SIZE=2>. At least one Non-GOF Board Member shall be a member of each of the audit committee, compensation committee and
executive committee for so long as a Non-GOF Board Member has a right to a seat on the Board of Directors pursuant to Sections 4.1, 4.2(a) or 4.2(b); </FONT><FONT SIZE=2><I>provided  </I></FONT><FONT SIZE=2>that at least one Non-GOF Board Member is a
member of the Company's Board of Directors during such period and that the member to serve on such committees satisfies
all applicable Federal, state, securities exchange, quotation system, and self regulatory organization (including, without limitation, the Securities and Exchange Commission, New York Stock Exchange,
Nasdaq and the OTC Bulletin Board, as the case may be) rules and regulations regarding, concerning and relating to qualifications and requirements necessary for service on such committees. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4
</FONT><FONT SIZE=2><I>Termination</I></FONT><FONT SIZE=2>. The terms and provisions of this Article&nbsp;IV shall terminate upon a Change of Control. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>ARTICLE V<BR>
AFFIRMATIVE COVENANTS  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1
</FONT><FONT SIZE=2><I>Reporting Obligations</I></FONT><FONT SIZE=2>. </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Obligation to Register</I></FONT><FONT SIZE=2>. If a class of the Company's equity securities is not otherwise registered pursuant to
Section&nbsp;12(d) or Sections 12(g)(1)(A) or (B)&nbsp;of the Exchange Act, the Company shall (a)&nbsp;use its best efforts to register the Class&nbsp;A Common Stock, on a voluntary basis,
with the Commission
pursuant to Section&nbsp;12(g) of the Exchange Act and to have such registration declared effective as soon as possible after the date hereof, and (b)&nbsp;file all periodic and other reports and
filings required to be filed by issuers with a class of equity securities registered under Sections 12(d) or (g)&nbsp;of the Exchange Act. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Termination of Obligation to Register</I></FONT><FONT SIZE=2>. The Company shall not seek to terminate the voluntary registration of its
Class&nbsp;A Common Stock required by Section&nbsp;5.1(a) above, and shall continue to file all periodic and other reports and filings required to be filed by issuers with a class of equity
securities registered under Section&nbsp;12(g) of the Exchange Act, until the termination of the covenants in this Article&nbsp;V in accordance with Section&nbsp;5.6. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2
</FONT><FONT SIZE=2><I>Incorporation</I></FONT><FONT SIZE=2>. The Company shall maintain its corporate existence in Delaware; </FONT> <FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT><FONT SIZE=2><I>however</I></FONT><FONT SIZE=2>, that the
Company may reincorporate elsewhere if such reincorporation is necessary to
effectuate a bona fide business combination or other transaction; </FONT><FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT><FONT SIZE=2><I>further</I></FONT><FONT SIZE=2>, that any such
business combination or other transaction with a PGI Affiliate shall require the approval of one (1)&nbsp;Non-GOF Board Member. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3
</FONT><FONT SIZE=2><I>Listing</I></FONT><FONT SIZE=2>. On the Effective Date, or as soon as practicable thereafter, the Company shall use its reasonable best efforts to become a
listed company on the New York Stock Exchange or to become included for quotation on The Nasdaq Stock Market; provided that the Company shall initially list its shares of Class&nbsp;A Common Stock
and Class&nbsp;B Common Stock for trading on the Nasdaq bulletin board or over-the-counter market. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4
</FONT><FONT SIZE=2><I>Related Party Transactions</I></FONT><FONT SIZE=2>. </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;Without
the written approval of at least one Non-GOF Board Member, the Company shall not enter into any transactions with any PGI Affiliate; provided,
however, that in the case of GOF, CSFB or any Affiliate of GOF or CSFB, such approval is only required for transactions that </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>12</FONT></P>

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exceed $10,000,000; provided further, that no such approval is required for transactions between the Company, its Subsidiaries or its Affiliates and Huntsman Company, LLC, its Subsidiaries or its
Affiliates that are substantially consistent with past practice; provided further that, solely for the avoidance of doubt, nothing in this Section&nbsp;5.4 will require the termination of any of the
existing terms or provisions of, or existing obligations under, any of the following relationships between the Company and any PGI Affiliate: (a)&nbsp;the existing lease and shared services
agreement relating to the Company's headquarters, each between the Company and [&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;]; (b)&nbsp;the shared
insurance purchasing arrangement between the Company and
[&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;]; and (c)&nbsp;the shared employee benefits management agreement between the Company and
[&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;]. Notwithstanding anything
to the contrary herein, (x)&nbsp;any amendment, modification, extension or change to, or waiver under, any of the relationships between the Company and any PGI Affiliate set forth in the final
proviso to the immediately preceding sentence shall require the written approval of at least one Non-GOF Board Member, and (y)&nbsp;the Company shall not be restricted in any
respect from terminating any of the relationships, agreements or arrangements set forth in the final proviso to the immediately preceding sentence. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;Notwithstanding
the provisions of Section&nbsp;5.4(a), in no case shall the Company enter into any agreement to pay, nor shall it pay, any management fee or
transaction fee to any PGI Affiliate, excluding fees of up to an aggregate of $4,500,000 payable to GOF pursuant to the Plan. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.5
</FONT><FONT SIZE=2><I>Registration Rights</I></FONT><FONT SIZE=2>. In the event that the Company, GOF or any Non-GOF Holder shall determine, based upon the reasonable
advice of counsel, that (a)&nbsp;the Convertible Notes may not be offered for resale or resold, or (b)&nbsp;the Initial Common Stock issuable upon conversion of the Convertible Notes may not be
issued, offered for resale and/or resold, in each of the cases set forth in the foregoing clauses (a)&nbsp;and (b), without the registration of such offer, resale and/or issuance under the
Securities Act and the rules and regulations promulgated thereunder, or an exemption therefrom, GOF or such Non-GOF Holder shall have the right to cause the Company to use its reasonable
best efforts to register the offer, resale and/or issuance of all Convertible Notes and/or Initial Common Stock issuable upon the conversation thereof, as the case may be, under the Securities Act
pursuant to a registration statement on Form&nbsp;S-1 or Form&nbsp;S-3, if available to the Company (or successors to such forms adopted by the Securities and Exchange
Commission or any successor thereto). In the event a registration is requested pursuant to this Section&nbsp;5.5, GOF and the Non-GOF Holders shall reasonably cooperate with the Company
in the preparation of the registration statement, and the Company shall, among other things, pay all expenses of the registration (including, without limitation, the costs and expenses of Noteholder
Counsel), provide Noteholder Counsel with a reasonable opportunity to review and comment upon the registration statement, communications with the staff of the Securities Exchange Commission and
related documents, and effect such registration as soon as shall be reasonably practicable. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.6 </FONT> <FONT SIZE=2><I>Termination of Covenants</I></FONT><FONT SIZE=2>. The covenants of the Company contained in this Article&nbsp;V shall terminate, and be of no further force
or effect, upon the consummation of a going private transaction or Change of Control. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>ARTICLE VI<BR>
GENERAL  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1
</FONT><FONT SIZE=2><I>Transfer</I></FONT><FONT SIZE=2>. </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Transfers by GOF Parties</I></FONT><FONT SIZE=2>. Upon any transfer of shares of Class&nbsp;A Common Stock by a GOF Party that complies with
Article&nbsp;III other than transfers to other GOF Parties (including, without limitation, (a)&nbsp;transfers of shares of Class&nbsp;A Common Stock that are not deemed Subject Shares pursuant
to
Section&nbsp;3.01; and (b)&nbsp;transfers of shares of Class&nbsp;A Common Stock that are not subject to Section&nbsp;3.2 as a result of a waiver obtained pursuant to Section&nbsp;3.4), such
transferred </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>13</FONT></P>

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shares and the transferee that acquires them shall not be subject to the terms of Article&nbsp;III. The rights of GOF under Article&nbsp;IV of this Agreement may be assigned, in whole or in part,
by GOF to any Person to which GOF transfers Class&nbsp;A Common Stock; provided that the transferee provides written notice of such assignment to the Company and the other signatories hereto and
agrees in writing to be bound by the terms of Article&nbsp;IV applicable to GOF. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Transfers by the Non-GOF Holders, Zucker and Boyd</I></FONT><FONT SIZE=2>. The Non-GOF Holders, Zucker and Boyd shall be
prohibited from transferring any or all of their respective rights or obligations under Article&nbsp;IV to any Person; provided, however, that nothing in this Section&nbsp;6.1(b) shall limit the
rights granted to each beneficial owner of Initial Common Stock pursuant to Article&nbsp;II and Article&nbsp;III and nothing in this Agreement shall prevent any such holders from transferring
their shares of Common Stock. </FONT></P>

</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>6.2</FONT></DT><DD><FONT SIZE=2><I>Legends</I></FONT><FONT SIZE=2>. Each certificate evidencing shares of Initial Common Stock and each certificate issued in exchange for or upon the transfer of
any shares of Initial Common Stock shall be stamped or otherwise imprinted with a legend in substantially the following form (in addition to any other legends required by applicable law or other
agreements to which the such shares are subject): </FONT></DD></DL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"THE
SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A SHAREHOLDERS' AGREEMENT DATED AS OF MARCH 5, 2003, AMONG POLYMER GROUP,&nbsp;INC. (THE "COMPANY") AND CERTAIN OF THE
COMPANY'S SHAREHOLDERS. THE TERMS OF SUCH SHAREHOLDERS' AGREEMENT INCLUDES, AMONG OTHER THINGS, A VOTING AGREEMENT AMONG CERTAIN OF THE COMPANY'S SHAREHOLDERS AND CONTRACTUAL PREEMPTIVE RIGHTS, IN
FAVOR OF THE HOLDER HEREOF AND THE OTHER HOLDERS OF INITIAL COMMON STOCK (AS SUCH TERM IS DEFINED THEREIN), ON CERTAIN ISSUANCES BY THE COMPANY. A COPY OF SUCH SHAREHOLDERS' AGREEMENT WILL BE
FURNISHED WITHOUT CHARGE BY THE COMPANY TO THE HOLDER HEREOF UPON WRITTEN REQUEST." </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
legend set forth above shall be removed from the certificates evidencing any shares which cease to be governed by this Agreement. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3 </FONT> <FONT SIZE=2><I>Severability</I></FONT><FONT SIZE=2>. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4
</FONT><FONT SIZE=2><I>Enforcement</I></FONT><FONT SIZE=2>. </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Third Party Beneficiaries</I></FONT><FONT SIZE=2>. All holders of Initial Common Stock shall be third party beneficiaries of Article&nbsp;II,
Article&nbsp;III and Sections 5.1, 5.3, 5.4, 6.4, 6.8 and 6.9 of this Agreement, and shall have the right to enforce the terms of such provisions as if they were parties hereto. Notwithstanding the
foregoing or anything to the contrary in this Agreement, no holder of Initial Common Stock shall be deemed a third party beneficiary of, or have the right to enforce, any Article, Section, term or
provision of this Agreement not explicitly identified in the immediately preceding sentence. All initial holders of Convertible Notes as of the Effective Date shall be third party beneficiaries of
Section&nbsp;5.5 of this Agreement and shall have the right to enforce the terms of such provision as if they were parties hereto provided that such holder still beneficially owns such Convertible
Notes. Notwithstanding the foregoing or anything to the contrary in this Agreement, no holder of Convertible Notes shall be deemed a third party beneficiary of, or have the right to enforce, any
Article, Section, term or provision of this Agreement not explicitly identified in the immediately preceding sentence. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Specific Performance</I></FONT><FONT SIZE=2>. In addition to any and all other remedies that may be available at law in the event of any breach
of this Agreement, each party shall be entitled to specific performance of the agreements and obligations of the Company and the other parties hereunder </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>14</FONT></P>

<HR NOSHADE>
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<A NAME="page_kg1872_1_15"> </A>
<UL>
<BR>

<P><FONT SIZE=2>
and to such other injunctive or other equitable relief as may be granted by a court of competent jurisdiction. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.5 </FONT> <FONT SIZE=2><I>Governing Law</I></FONT><FONT SIZE=2>. This Agreement shall be governed by and construed in accordance with the internal laws of the State of New York
(without reference to the conflicts of law provisions thereof). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.6
</FONT><FONT SIZE=2><I>Notices</I></FONT><FONT SIZE=2>. All notices, requests, consents, and other communications under this Agreement shall be in writing and shall be deemed
delivered (a)&nbsp;three (3)&nbsp;business days after being sent by registered or certified mail, return receipt requested, postage prepaid, (b)&nbsp;one business day after being sent via a
reputable nationwide overnight courier service guaranteeing next business day delivery (provided that such notice, request, consent or other communication was deposited with such courier prior to its
deadline for next day delivery), or (c)&nbsp;the same day of such notice being sent by facsimile (where a fax confirmation is retained and presented to the intended recipient of such notice,
request, consent or other communication when requested thereby) or by personal delivery, in each case to the intended recipient as set forth below: </FONT></P>

<!-- User-specified TAGGED TABLE -->
<DIV ALIGN="CENTER"><TABLE WIDTH="63%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2>If to the Company, to:</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2><BR>
Polymer Group,&nbsp;Inc.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>4838 Jenkins Avenue</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>North Charleston, South Carolina 29405</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>Facsimile: (843)&nbsp;747-4092</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>Attention: General Counsel</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2><BR>
with a copy to:</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2><BR>
Kirkland&nbsp;&amp; Ellis</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>200 East Randolph Drive</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>Chicago, Illinois 60601</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>Facsimile: (312)&nbsp;861-2200</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>Attention: H. Kurt von Moltke</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2><BR>
If to GOF, to:</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2><BR>
MatlinPatterson Global Opportunities Partners L.P.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>c/o: MatlinPatterson Global Advisers LLC</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>520 Madison Avenue</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>New York, New York 10022</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>Facsimile: (212)&nbsp;651-4010</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>Attention: Ramon Betolaza</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2><BR>
with a copy to:</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2><BR>
Orrick, Herrington&nbsp;&amp; Sutcliffe LLP</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>666 Fifth Avenue</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>New York, NY 10103</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>Facsimile: (212)&nbsp;506-5151</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>Attention: Duncan N. Darrow, Esq.</FONT></TD>
</TR>
</TABLE></DIV>
<!-- end of user-specified TAGGED TABLE -->

<P ALIGN="CENTER"><FONT SIZE=2>15</FONT></P>

<HR NOSHADE>
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<A NAME="page_kg1872_1_16"> </A>
<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
to a Non-GOF Holder, at the address set forth below such Non-GOF Holder's signature hereto. </FONT></P>
</UL>
<!-- User-specified TAGGED TABLE -->
<DIV ALIGN="CENTER"><TABLE WIDTH="63%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2>If to Zucker, to:</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2><BR>
Jerry Zucker</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>C/o Polymer Group,&nbsp;Inc.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>4838 Jenkins Avenue</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>North Charleston, South Carolina 29405</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>Facsimile: (843)&nbsp;747-4092</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2><BR>
If to Boyd, to:</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2><BR>
James G. Boyd</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>C/o Polymer Group,&nbsp;Inc.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>4838 Jenkins Avenue</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>North Charleston, South Carolina 29405</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="94%"><FONT SIZE=2>Facsimile: (843)&nbsp;747-4092</FONT></TD>
</TR>
</TABLE></DIV>
<!-- end of user-specified TAGGED TABLE -->


<P><FONT SIZE=2>Any
party may give any notice, request, consent or other communication under this Agreement using any other means (including, without limitation, personal delivery, messenger service, telecopy, first
class mail or electronic mail), but no such notice, request, consent or other communication using such other means shall be deemed to have been duly given unless and until it is actually received by
the party for whom it is intended. Any party may change the address to which notices, requests, consents or other communications hereunder are to be delivered by giving the other parties notice in the
manner set forth in this Section. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.7
</FONT><FONT SIZE=2><I>Complete Agreement</I></FONT><FONT SIZE=2>. This Agreement constitutes the entire agreement and understanding of the parties hereto with respect to the
subject matter hereof and supersedes all prior agreements and understandings relating to such subject matter. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.8
</FONT><FONT SIZE=2><I>Amendments</I></FONT><FONT SIZE=2>. Except as may otherwise be set forth in Sections 2.4 and 3.3, all amendments to this Agreement shall be in writing and
must be approved by (a)&nbsp;the Board of Directors of the Company, including at least one Non-GOF Board Member, and (b)&nbsp;GOF; provided, however, that any amendment to
Article&nbsp;IV must be approved by the director affected by such amendment. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.9 </FONT> <FONT SIZE=2><I>Additional Shareholder</I></FONT><FONT SIZE=2>. Notwithstanding anything to the contrary contained herein, in connection with the issuance by the Company of
additional shares of Common Stock (including shares of Common Stock issuable upon the conversion, exercise or exchange of securities issued by the Company), the Company, with the approval of the Board
of Directors, including at least one Non-GOF Board Member, and the written consent of GOF, may grant to any purchaser of such shares of Common Stock (or such shares of Common Stock
issuable upon the conversion, exercise or exchange of securities) rights equivalent to those granted to the Initial Shareholders pursuant to Article&nbsp;II and Article&nbsp;III. Upon execution
and delivery by such purchaser of an additional counterpart signature page to this Agreement, such Common Stock shall be deemed "Initial Common Stock" hereunder, and such purchaser shall be deemed an
"Initial Shareholder" hereunder. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.10
</FONT><FONT SIZE=2><I>Counterparts</I></FONT><FONT SIZE=2>; Facsimile Signatures. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be
an original, and all of which together shall constitute one and the same document. This Agreement may be executed by facsimile signatures. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.11
</FONT><FONT SIZE=2><I>Non-GOF Board Member Vote</I></FONT><FONT SIZE=2>. Notwithstanding anything to the contrary herein, any waiver, termination, amendment or other
action that, pursuant to any Section of this Agreement, requires the consent or approval of a Non-GOF Board Member shall require such consent or approval only if both (a)&nbsp;at least
one Non-GOF Board Member has the right to a seat on the Board of Directors pursuant to </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>16</FONT></P>

<HR NOSHADE>
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<A NAME="page_kg1872_1_17"> </A>
<BR>

<P><FONT SIZE=2>
Sections 4.1, 4.2(a) or 4.2(b) of this Agreement, and (b)&nbsp;at the time such approval is sought one of the following is true (i)&nbsp;at least one Non-GOF Board Member is a member
of the board of directors, (ii)&nbsp;if a Non-GOF Board Member is not a member of the board of directors, a Non-GOF Board Member shall have been a member of the board of
directors within sixty days of such time, or (iii)&nbsp;if a Non-GOF Board Member is not, and, within sixty days of such time, has not been, a member of the board of directors, a
nomination or designation of a proposed Non-GOF Board Member shall have been made in good faith pursuant to the terms of the Shareholders Agreement and not withdrawn, and such nominee or
designee shall not have refused or declined appointment to the board of directors. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.12
</FONT><FONT SIZE=2><I>Fractional Shares</I></FONT><FONT SIZE=2>. Notwithstanding anything to the contrary herein, the provisions of Article&nbsp;II and Article&nbsp;III shall
not be deemed to grant any shareholder the right to purchase or sell any fractional share, and (a)&nbsp;with respect to Article&nbsp;II, the Company shall have the right to determine, in its
reasonable discretion, the treatment of fractional share amounts, and (b)&nbsp;with respect to Article&nbsp;III, the applicable GOF Party shall have the right to determine, in its reasonable
discretion, the treatment of fractional share amounts. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>*
* * * * * </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>17</FONT></P>

<HR NOSHADE>
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<P><FONT SIZE=2>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first written above. </FONT></P>

<!-- User-specified TAGGED TABLE -->
<TABLE WIDTH="78%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=3><FONT SIZE=2><B>POLYMER GROUP,&nbsp;INC.</B></FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Name:<BR>
Title:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3><BR><FONT SIZE=2><B>MATLINPATTERSON GLOBAL<BR>
OPPORTUNITIES PARTNERS L.P.</B></FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2><BR>
MatlinPatterson Global Advisers LLC, its Investment Advisor</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Name:<BR>
Title:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3><BR><FONT SIZE=2><B>NORTHEAST INVESTORS TRUST</B></FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Name:<BR>
Title:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3><FONT SIZE=2><BR>
50 Congress Street, Room 1000<BR>
Boston, MA 02109</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3><BR><FONT SIZE=2><B>ONE GROUP INCOME BOND FUND</B></FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2><BR>
Banc One High Yield Partners, LLC, its investment advisor</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Name:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2>James P. Shanahan, Jr.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Title:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2>Manager</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3><FONT SIZE=2><BR>
8044 Montgomery Road, Suite 480<BR>
Cincinnati, OH 45236</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3><BR><FONT SIZE=2><B>ONE GROUP HIGH YIELD BOND FUND</B></FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2><BR>
Banc One High Yield Partners, LLC, its investment advisor</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Name:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2>James P. Shanahan, Jr.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Title:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2>Manager</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3><FONT SIZE=2><BR>
8044 Montgomery Road, Suite 480<BR>
Cincinnati, OH 45236</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3><BR><FONT SIZE=2><B>SOUTHERN UTE GROWTH FUND</B></FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2><BR>
Banc One High Yield Partners, LLC, its investment advisor</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><HR NOSHADE></TD>
</TR>
</TABLE>
<!-- insert table folio -->
<HR NOSHADE>
<!-- ZEQ.=1,SEQ=18,EFW="2104906",CP="POLYMER GROUP, INC.",DN="4",CHK=315342,FOLIO='blank',FILE='DISK013:[03CHI2.03CHI1872]KH1872A.;8',USER='SSINN',CD=';5-MAR-2003;09:35' -->
<!-- end of table folio -->
<TABLE WIDTH="78%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Name:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2>James P. Shanahan, Jr.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Title:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2>Manager</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3><FONT SIZE=2><BR>
8044 Montgomery Road, Suite 480<BR>
Cincinnati, OH 45236</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3><BR><FONT SIZE=2><B>SOUTHERN UTE PERMANENT FUND</B></FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2><BR>
Banc One High Yield Partners, LLC, its investment advisor</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Name:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2>James P. Shanahan, Jr.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Title:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2>Manager</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3><FONT SIZE=2><BR>
8044 Montgomery Road, Suite 480<BR>
Cincinnati, OH 45236</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3><BR><FONT SIZE=2><B>ATLANTIC GLOBAL FUNDING&nbsp;LTD.</B></FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2><BR>
Delaware Investment Advisors, its collateral manager</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Name:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2>Carl E. Mabry</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Title:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2>Vice-President</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3><FONT SIZE=2><BR>
One Commerce Square, 40th Floor<BR>
Philadelphia, PA 19103</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3><BR><FONT SIZE=2><B>CHYPS 1997-1&nbsp;LTD.</B></FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2><BR>
Delaware Investment Advisors, its collateral manager</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Name:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2>Carl E. Mabry</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Title:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2>Vice-President</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3><FONT SIZE=2><BR>
One Commerce Square, 40th Floor<BR>
Philadelphia, PA 19103</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3><BR><FONT SIZE=2><B>CHYPS 1999-1&nbsp;LTD.</B></FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2><BR>
Delaware Investment Advisors, its collateral manager</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Name:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2>Carl E. Mabry</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Title:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2>Vice-President</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3><FONT SIZE=2><BR>
One Commerce Square, 40th Floor<BR>
Philadelphia, PA 19103</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3><BR><HR NOSHADE><FONT SIZE=2> James G. Boyd, in his individual capacity</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="39%" ALIGN="CENTER"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3><BR><HR NOSHADE><FONT SIZE=2> Jerry Zucker, in his individual capacity</FONT></TD>
</TR>
</TABLE>
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<HR NOSHADE>
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<BR>
<P><br><A NAME="03CHI1872_4">QuickLinks</A><br></P><!-- TOC_BEGIN -->
<UL>
<FONT SIZE=2><A HREF="#toc_ke1872_1">EXHIBIT 3</A></FONT><BR>
</UL>
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</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.1
<SEQUENCE>6
<FILENAME>a2104906zex-4_1.htm
<DESCRIPTION>EXHIBIT 4.1
<TEXT>
<HTML>
<HEAD>

</HEAD>
<BODY BGCOLOR="#FFFFFF" LINK=BLUE  VLINK=PURPLE>
<BR>
<FONT SIZE=3 ><A HREF="#03CHI1872_5">QuickLinks</A></FONT>
<font size=3> -- Click here to rapidly navigate through this document</font>
<!-- TOC_END -->
<P ALIGN="RIGHT"><FONT SIZE=2><A
NAME="ki1872_exhibit_4.1"> </A>
<A NAME="toc_ki1872_1"> </A>
<BR></FONT><FONT SIZE=2><B>EXHIBIT 4.1    <BR>  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;POLYMER GROUP,&nbsp;INC.<BR>
<BR>
and<BR>
<BR>
WACHOVIA BANK, N.A.,<BR>
<BR>
as Warrant Agent<BR>
<BR>
SERIES A WARRANT AGREEMENT<BR>
<BR>
Dated as of March&nbsp;5, 2003 </FONT></P>

<HR NOSHADE>
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<!-- THIS IS THE END OF A COMPOSITION COMPONENT -->
<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="page_kj1872_1_1"> </A> </FONT> <FONT SIZE=2><B>TABLE OF CONTENTS  </B></FONT></P>

<!-- User-specified TAGGED TABLE -->
<TABLE WIDTH="81%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH WIDTH="4%" ALIGN="LEFT"><FONT SIZE=2>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TH>
<TH WIDTH="8%" ALIGN="LEFT"><FONT SIZE=2>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TH>
<TH WIDTH="79%" ALIGN="LEFT"><FONT SIZE=2>&nbsp;</FONT><BR></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="5%" ALIGN="CENTER"><FONT SIZE=1><B>Page</B></FONT><HR NOSHADE></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>1.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2>DEFINITIONS</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>1</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
2.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
EXECUTION AND DELIVERY OF WARRANT CERTIFICATES</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
3</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
3.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
EXERCISE OF WARRANT</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
4</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>3.1.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Exercise Period</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>4</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>3.2.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Exercise Procedure</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>4</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>3.3.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Exercise Agreement</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>5</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
4.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
TRANSFER, DIVISION AND COMBINATION</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
5</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>4.1.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Division, Combination and Exchange</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>5</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>4.2.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Expenses</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>6</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>4.3.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Maintenance of Books</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>6</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>4.4.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Transfer</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>6</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
5.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
ADJUSTMENTS</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
6</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
6.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
NOTICES OF AdJUSTMENT</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
6</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
7.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
RESERVATION AND AUTHORIZATION OF COMMON STOCK; REGISTRATION WITH OR APPROVAL OF ANY GOVERNMENTAL AUTHORITY</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
7</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
8.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
STOCK AND WARRANT TRANSFER BOOKS</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
7</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
9.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
SUPPLYING INFORMATION</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
7</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
10.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
LOSS OR MUTILATION</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
8</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
11.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
OFFICE OF COMPANY</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
8</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
12.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
LIMITATION OF LIABILITY</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
8</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
13.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
CONCERNING THE WARRANT AGENT</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
8</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>13.1.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Correctness of Statement</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>8</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>13.2.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Breach of Covenants</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>8</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>13.3.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Reliance on Counsel</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>8</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>13.4.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Reliance on Documents</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>8</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>13.5.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Compensation and Indemnification</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>9</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>13.6.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Legal Proceedings</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>9</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>13.7.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Other Transactions in Securities of the Company</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>9</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>13.8.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Liability of Warrant Agent</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>9</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>13.9.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Adjustments</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>9</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>13.10.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Resignation and Removal</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>9</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
14.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
MISCELLANEOUS</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
10</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>14.1.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Nonwaiver</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>10</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>14.2.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Notice Generally</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>10</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>14.3.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Appointment of Warrant Agent</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>10</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>14.4.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Successors and Assigns</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>10</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>14.5.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Amendment</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>10</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>14.6.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Severability</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>11</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>14.7.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Headings</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>11</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>14.8.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Governing Law</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>11</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=5 VALIGN="TOP"><FONT SIZE=2><BR>
Exhibit&nbsp;A&nbsp;&nbsp;&nbsp;&nbsp;Form of Series&nbsp;A Warrant Certificate</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
13</FONT></TD>
</TR>
</TABLE>
<!-- insert table folio -->
<P ALIGN="CENTER"><FONT SIZE=2>i</FONT></P>

<HR NOSHADE>
<!-- ZEQ.=1,SEQ=2,EFW="2104906",CP="POLYMER GROUP, INC.",DN="5",CHK=936279,FOLIO='i',FILE='DISK013:[03CHI2.03CHI1872]KJ1872A.;7',USER='SSINN',CD=';5-MAR-2003;09:58' -->
<A NAME="page_kj1872_1_2"> </A>
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<TABLE WIDTH="81%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=5 VALIGN="TOP"><FONT SIZE=2><BR>
Exhibit&nbsp;B Subscription Form</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=5 VALIGN="TOP"><FONT SIZE=2><BR>
Exhibit&nbsp;C Assignment Form</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
</TABLE>
<!-- end of user-specified TAGGED TABLE -->

<P ALIGN="CENTER"><FONT SIZE=2>ii</FONT></P>

<HR NOSHADE>
<!-- ZEQ.=2,SEQ=3,EFW="2104906",CP="POLYMER GROUP, INC.",DN="5",CHK=632167,FOLIO='ii',FILE='DISK013:[03CHI2.03CHI1872]KJ1872A.;7',USER='SSINN',CD=';5-MAR-2003;09:58' -->
<!-- THIS IS THE END OF A COMPOSITION COMPONENT -->
<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="page_kl1872_1_1"> </A> </FONT> <FONT SIZE=2><B><I>WARRANT AGREEMENT</I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WARRANT
AGREEMENT, dated as of March&nbsp;5, 2003 (the "Warrant Agreement"), between Polymer Group,&nbsp;Inc., a Delaware corporation (the "Company"), and Wachovia Bank, N.A., as
Warrant Agent (the "Warrant Agent"). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
pursuant to the Joint Second Amended Modified Plan of Reorganization (the "</FONT><FONT SIZE=2><I>Plan</I></FONT><FONT SIZE=2>") of the Company and certain of its subsidiaries,
as confirmed by the United States Bankruptcy Court for the District of South Carolina on January&nbsp;16, 2003, the Company proposes to issue Series&nbsp;A Warrants (as defined herein),
representing the right to purchase up to an aggregate of 498,688 shares of its Class&nbsp;D Common (as defined herein), subject to adjustment as hereinafter provided; and </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
the Company desires to appoint the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing so to act in connection with the issuance, transfer, exchange,
replacement and exercise of the Series&nbsp;A Warrant Certificates (as defined herein) and other matters as provided herein; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOW
THEREFORE, in consideration of the foregoing and for the purpose of defining the terms and conditions of the Series&nbsp;A Warrants and the respective rights and obligations
thereunder of the Company and the holders from time to time of the Series&nbsp;A Warrants, the Company and the Warrant Agent hereby agree as follows: </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. </FONT> <FONT SIZE=2><I>DEFINITIONS</I></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
used in this Warrant Agreement, the following terms have the respective meanings set forth below: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Business
Day" means any day that is not a Saturday or Sunday or a day on which banks are required or permitted to be closed in the State of New York. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Change
of Control" means (i)&nbsp;a merger, reorganization, restructuring, consolidation, share exchange, business combination, recapitalization, liquidation, dissolution or similar
transaction involving the Company in which the Company is not the surviving or resulting entity, as a result of which the Company's stockholders prior to such transactions, MatlinPatterson Global
Opportunities Partners L.P., any Affiliates of MatlinPatterson Global Opportunities Partners L.P. and any Group that includes as a member MatlinPatterson Global Opportunities Partners L.P. or any
Affiliates of MatlinPatterson Global Opportunities Partners L.P. cease to own at least 50% of the voting securities of the entity surviving or resulting from such transaction (or the ultimate parent
entity thereof), or (ii)&nbsp;the acquisition, directly or indirectly, by any Person (other than MatlinPatterson Global Opportunities Partners L.P. or its Affiliates or any Group that includes as a
member MatlinPatterson Global Opportunities Partners L.P. or any Affiliates of MatlinPatterson Global Opportunities Partners L.P.) of 50% or more of the Company's voting securities whether by merger,
consolidation, share exchange, business combination, tender or exchange offer, issuance or sale of securities or otherwise, other than in any such transaction following which the Company's
stockholders prior to such transaction, MatlinPatterson Global Opportunities Partners L.P., any Affiliates of MatlinPatterson Global Opportunities Partners L.P. and any Group that includes as a member
MatlinPatterson Global Opportunities Partners L.P. or any Affiliates of MatlinPatterson Global Opportunities Partners L.P., continue to own at least 50% of the voting securities of the entity
surviving or resulting from such transaction (or the ultimate parent entity thereof). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Class&nbsp;D
Common" means shares of the Company's Class&nbsp;D Common Stock, par value $.01 per share; provided that if there is a change such that the securities issuable upon
exercise of the Series&nbsp;A Warrants are issued by an entity other than the Company or there is a change in the type or class of securities so issuable, then the term "Class&nbsp;D Common" shall
mean one share of the security issuable upon exercise of the Series&nbsp;A Warrants if such security is issuable in shares, or </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>1</FONT></P>

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<P><FONT SIZE=2>
shall mean the smallest unit in which such security is issuable if such security is not issuable in shares. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Closing
Date" means March&nbsp;5, 2003. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Commission"
means the Securities and Exchange Commission or any other federal agency then administering the Securities Act and other federal securities laws. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Common
Stock" means, collectively, the Company's Class&nbsp;A Common Stock, par value $.01 per share, the Company's Class&nbsp;B Common Stock, par value $.01 per share, the
Company's Class&nbsp;C Common Stock, par value $.01 per share, the Class&nbsp;D Common, the Company's Class&nbsp;E Common Stock, par value $.01 per share, and any capital stock of any class of
the Company hereafter authorized which is not limited to a fixed sum or percentage of par or stated value in respect to the rights of the holders thereof to participate in dividends or in the
distribution of assets upon any liquidation, dissolution or winding up of the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Current
Market Price" means, for the purpose of any computation of Current Market Price pursuant to this Warrant Agreement, the Current Market Price per share of Common Stock at any
date shall be the average of the daily closing sales prices for the shorter of (i)&nbsp;the 20 consecutive trading days ending on the last full trading day on the exchange or market specified in the
second succeeding sentence prior to the Time of Determination (as defined below) and (ii)&nbsp;the period commencing on the date next succeeding the first public announcement of the issuance, sale,
distribution or granting in question through such last full trading day prior to the Time of Determination; provided that in the case of a firm commitment underwritten public offering, the Current
Market Price shall mean the closing price of the Common Stock on the day of the pricing of such offering. The term "Time of Determination" as used herein shall be the time and date of the earlier to
occur of (A)&nbsp;the date as of which the Current Market Price is to be computed and (B)&nbsp;the last full trading day on such exchange or market before the commencement of
"ex-dividend" trading in the Common Stock relating to the event giving rise to the adjustment required by Section&nbsp;2.1, 2.2, 2.3, 2.4, 2.5 or 2.7 of the Series&nbsp;A Warrant
Certificates. The closing price for any day shall be the last reported sale price regular way or, in case no such reported sale takes place on such day, the average of the closing bid and asked prices
regular way for such day, in each case (1)&nbsp;on the principal national securities exchange on which the shares of Common Stock are listed or to which such shares are admitted to trading or
(2)&nbsp;if the Common Stock is not listed or admitted to trading on a national securities exchange, in the over-the-counter market as reported by the NASDAQ National Market
or any comparable system or (3)&nbsp;if the Common Stock is not listed on the NASDAQ National Market or a comparable system, the fair market value as determined in good faith by the Board of
Directors of the Company for that purpose. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Distribution
Notice" has the meaning set forth in Section&nbsp;3.1. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Exchange
Act" means the Securities Exchange Act of 1934, as amended, or any similar federal statute, and the rules and regulations of the Commission thereunder, as the same shall be in
effect from time to time. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Exercise
Period" has the meaning set forth in Section&nbsp;3.1. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Exercise
Price" means an amount equal to $.01 per share of Class&nbsp;D Common purchasable upon exercise of the Series&nbsp;A Warrants, as adjusted from time to time pursuant to
Section&nbsp;5 hereof and Section&nbsp;2 of the Series&nbsp;A Warrant Certificates. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Group"
means a "group" within the meaning of Section&nbsp;13(d)(3) of the Exchange Act. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Person"
means an individual, a partnership, a limited liability partnership, a joint venture, a corporation, a limited liability company, a trust, an unincorporated organization, any
other legal entity and a government or any department or agency thereof. </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>2</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Plan"
has the meaning assigned to such term in the recitals in this Warrant Agreement. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Registered
Holder" means, at any time, a Person in whose name a Series&nbsp;A Warrant is then registered on the books of the Company maintained by the Warrant Agent for such purpose. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Securities
Act" means the Securities Act of 1933, as amended, or any similar federal statute, and the rules and regulations of the Commission thereunder, all as the same shall be in
effect at the time. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Series&nbsp;A
Warrant" means each of the Company's warrants issued pursuant to this Warrant Agreement, each of which evidences the right to purchase one share of Class&nbsp;D
Common, subject to adjustment as set forth in the Series&nbsp;A Warrant Certificates, and all warrants issued upon transfer, division or combination of, or in substitution for, any thereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Series&nbsp;A
Warrant Certificate" means a certificate, substantially in the form of Exhibit&nbsp;A hereto, representing one or more Series&nbsp;A Warrants held by a Holder. All
Series&nbsp;A Warrant Certificates shall be identical as to terms and conditions, except as to the number of Series&nbsp;A Warrants represented thereby. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Series&nbsp;A
Warrant Stock" means the shares of Class&nbsp;D Common purchased by the Holders of the Series&nbsp;A Warrants upon the exercise thereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Series&nbsp;B
Warrant" means each of the Company's warrants issued pursuant to the Series&nbsp;B Warrant Agreement, each of which evidences the right to purchase one share of the
Company's Class&nbsp;E Common, par value $.01 per share, subject to adjustment as set forth in the Series&nbsp;B Warrant Certificates, and all warrants issued upon transfer, division or
combination of, or in substitution for, any thereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Series&nbsp;B
Warrant Agreement" means the Series&nbsp;B Warrant Agreement, dated as of the date hereof, between the Company and the Warrant Agent. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Series&nbsp;B
Warrant Certificate" means a certificate, substantially in the form of Exhibit&nbsp;A to the Series&nbsp;B Warrant Agreement, representing one or more
Series&nbsp;B Warrants held by a holder thereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Termination
Date" has the meaning set forth in Section&nbsp;3.1. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.
</FONT><FONT SIZE=2><I>EXECUTION AND DELIVERY OF WARRANT CERTIFICATES</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Series&nbsp;A
Warrant Certificates evidencing 498,688 Series&nbsp;A Warrants, each Series&nbsp;A Warrant to purchase initially one share of Class&nbsp;D Common, may be executed,
on or after the date of this Warrant Agreement, by the Company and delivered to the Warrant Agent for countersignature, and the Warrant Agent shall thereupon countersign and deliver such
Series&nbsp;A Warrant Certificates upon the order and at the written direction of the Company signed by its Chief Executive Officer, President, Chief Financial Officer, any Vice President or other
duly authorized executive officer. The Warrant Agent is hereby authorized to countersign and deliver Series&nbsp;A Warrant Certificates as required by this Section&nbsp;2 or by Section&nbsp;3.2,
4 or 11 hereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Series&nbsp;A Warrant Certificates shall be executed on behalf of the Company by its Chairman of the Board, Chief Executive Officer, President, Chief Financial Officer, any Vice
President or other duly authorized executive officer of the Company either manually or by facsimile signature printed thereon. The Series&nbsp;A Warrant Certificates shall be countersigned by manual
signature of the Warrant Agent and shall not be valid for any purpose unless so countersigned. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
case any officer or director of the Company whose signature shall have been placed upon any Series&nbsp;A Warrant Certificate shall cease to be such officer or director of the
Company before </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>3</FONT></P>

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<P><FONT SIZE=2>
countersignature by the Warrant Agent and the issuance and delivery thereof, such Series&nbsp;A Warrant Certificate may nevertheless be countersigned by the Warrant Agent and issued and delivered
with the same force and effect as though such person had not ceased to be such officer or director of the Company. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.
</FONT><FONT SIZE=2><I>EXERCISE OF WARRANT</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1
</FONT><FONT SIZE=2><I>Exercise Period</I></FONT><FONT SIZE=2>. A Registered Holder may exercise, in whole or in part, the purchase rights represented by Series&nbsp;A Warrants at
any time and from time to time after the delivery by the Company of a Distribution Notice to the Registered Holders up to and including the Termination Date (the "Exercise Period"). The purchase
rights represented by the Series&nbsp;A Warrants shall not be exercisable until the Company delivers a Distribution Notice. The Company shall give the Registered Holders written notice thirty
(30)&nbsp;calendar days prior to any Distribution (as defined in the Company's Amended and Restated Certificate of Incorporation) or consummation of a Change in Control in which an outstanding share
of Class&nbsp;D Common would be entitled to participate pursuant to the terms of the Company's Amended and Restated Certificate of Incorporation (a "Distribution Notice"). The Series&nbsp;A
Warrants, the purchase rights represented thereby, all of the Company's obligations thereunder and any other rights of the Registered Holders thereunder shall terminate upon the earlier to occur of
(i)&nbsp;the
close of business on March&nbsp;4, 2010, and (ii)&nbsp;the business day immediately preceding the consummation of a Change of Control (collectively, the "Termination Date"). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2.
</FONT><FONT SIZE=2><I>Exercise Procedure</I></FONT><FONT SIZE=2>. </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;The
Series&nbsp;A Warrants shall be deemed to have been exercised when the Company has received all of the following items (the "Exercise Time"): </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;a
completed Exercise Agreement, as described in Section&nbsp;3.3 below, executed by the Person exercising all or part of the purchase rights represented by the
Series&nbsp;A Warrant being exercised (the "Purchaser"); </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;the
Series&nbsp;A Warrant Certificate in respect of the Series&nbsp;A Warrant being exercised; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;if
the Series&nbsp;A Warrant being exercised is not registered in the name of the Purchaser, an Assignment or Assignments in the form attached to the Series&nbsp;A
Warrant Certificate evidencing the assignment of the Series&nbsp;A Warrant being exercised to the Purchaser, in which case the Registered Holder shall have complied with the provisions set forth in
Section&nbsp;4 hereof; and </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;either
(1)&nbsp;a check payable to the Company in an amount equal to the product of the Exercise Price multiplied by the number of shares of Class&nbsp;D Common
being purchased upon such exercise (the "Aggregate Exercise Price"), or (2)&nbsp;a written notice to the Company that the Purchaser is exercising the Series&nbsp;A Warrant (or a portion thereof)
by authorizing the Company to withhold from issuance a number of shares of Class&nbsp;D Common issuable upon such exercise of such Series&nbsp;A Warrant which when multiplied by the Current Market
Price of the Common Stock is equal to the Aggregate Exercise Price (and such withheld shares shall no longer be issuable under such Series&nbsp;A Warrant). </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;Upon
delivery of the foregoing, certificates for shares of Class&nbsp;D Common purchased upon exercise of a Series&nbsp;A Warrant shall be delivered by the Company,
or, if so requested by the Company in writing, by the Warrant Agent, to the Purchaser within three business days after the date of the Exercise Time. Unless the Series&nbsp;A Warrants represented by
a surrendered Series&nbsp;A Warrant Certificate have expired or all of the purchase rights represented thereby have been exercised, the Company, or if so requested in writing by the Company, the
Warrant Agent, shall prepare a new Series&nbsp;A Warrant Certificate, substantially </FONT></P>

</UL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>4</FONT></P>

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<P><FONT SIZE=2>
identical thereto, representing the rights formerly represented by such Series&nbsp;A Warrant Certificate which have not expired or been exercised and shall, within such three-day
period, deliver such new Series&nbsp;A Warrant Certificate to the Person designated for delivery in the Exercise Agreement; </FONT><FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT> <FONT SIZE=2><I>however</I></FONT><FONT SIZE=2>, that if
(A)&nbsp;the Series&nbsp;A Warrants represented by such Series&nbsp;A Warrant Certificate are not
exercised in the name of the Purchaser and (B)&nbsp;the Assignment or Assignments delivered to the Company therewith are for less than all of the rights formerly represented by such Series&nbsp;A
Warrant Certificate, then a new Series&nbsp;A Warrant Certificate, substantially identical thereto, representing the rights formerly represented by such Series&nbsp;A Warrant Certificate which
have not expired or been exercised and which were not assigned pursuant to the Assignment or Assignments delivered to the Company shall, within such three-day period, be delivered by the
Company, or the Warrant Agent, as applicable, to the Registered Holder and a new Series&nbsp;A Warrant Certificate, substantially identical thereto, representing the rights formerly represented by
such Series&nbsp;A Warrant Certificate which have not expired or been exercised and which were assigned pursuant to the Assignment or Assignment delivered to the Company shall, within such
three-day period, be delivered by the Company, or the Warrant Agent, as applicable, to the Person designated for delivery in the Exercise Agreement. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;Notwithstanding
anything to the contrary herein, the exercise of a Series&nbsp;A Warrant upon the delivery of a Distribution Notice shall not be deemed effective, the
Class&nbsp;D Common issuable upon the exercise of such Series&nbsp;A Warrant shall not be deemed to have been issued to the Purchaser, and the Purchaser shall not be deemed to have become the
record holder of such Class&nbsp;D Common until immediately prior to the occurrence of the Distribution that was the subject of such Distribution Notice; </FONT> <FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT><FONT
SIZE=2><I>however</I></FONT><FONT SIZE=2>, that if the Distribution that was the subject of such Distribution Notice will result
from a Change of Control, the exercise of such Series&nbsp;A Warrant shall be deemed effective, the Class&nbsp;D Common issuable upon the exercise of such Series&nbsp;A Warrant shall be deemed
to have been issued to the Purchaser, and the Purchaser shall be deemed to have become the record holder of such Class&nbsp;D Common immediately prior to the consummation of such Change in Control. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;The
issuance of certificates for shares of Class&nbsp;D Common upon exercise of the Series&nbsp;A Warrants shall be made without charge to the Registered Holders or
any Purchaser for any issuance tax in respect thereof or other cost incurred by the Company or the Warrant Agent in connection with such exercise and the related issuance of shares of Class&nbsp;D
Common. Each share of Class&nbsp;D Common issuable upon exercise of the Series&nbsp;A Warrants shall, upon payment of the Exercise Price therefor, be fully paid and nonassessable and free from all
liens and charges with respect to the issuance thereof. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3.
</FONT><FONT SIZE=2><I>Exercise Agreement</I></FONT><FONT SIZE=2>. Upon any exercise of a Series&nbsp;A Warrant, the Exercise Agreement shall be substantially in the form set
forth in </FONT><FONT SIZE=2><I>Exhibit&nbsp;I </I></FONT><FONT SIZE=2>to the Series&nbsp;A Warrant Certificates, except that if the shares of Class&nbsp;D Common are not to be issued in the
name of the Person in whose name a Series&nbsp;A Warrant is registered, the Exercise Agreement shall also state the name of the Person to whom the certificates for the shares of Class&nbsp;D
Common are to be issued, and if the number of shares of Class&nbsp;D Common to be issued does not include all the shares of Class&nbsp;D Common purchasable thereunder, it shall also state the name
of the Person to whom a new Series&nbsp;A Warrant Certificate for the unexercised portion of the rights thereunder is to be delivered. Such Exercise Agreement shall be dated the actual date of
execution thereof. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.
</FONT><FONT SIZE=2><I>TRANSFER, DIVISION AND COMBINATION</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.
</FONT><FONT SIZE=2><I>Division, Combination and Exchange</I></FONT><FONT SIZE=2>. A Series&nbsp;A Warrant Certificate is exchangeable, upon the surrender thereof by the
Registered Holder at the office or agency of the Warrant Agent, together with a written notice specifying the names and denominations in which new Series&nbsp;A </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>5</FONT></P>

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<P><FONT SIZE=2>
Warrant Certificates are to be issued, signed by the Registered Holder of such Series&nbsp;A Warrant Certificate or Certificates or its agent or attorney, for new Series&nbsp;A Warrant
Certificates of like tenor representing in the aggregate the purchase rights thereunder. Subject to compliance with this Section&nbsp;4.1, as to any transfer which may be involved in such exchange,
the Warrant Agent shall execute and deliver a new Series&nbsp;A Warrant Certificate(s) in exchange for the Series&nbsp;A Warrant Certificate(s) representing the Series&nbsp;A Warrants to be
exchanged in accordance with such notice, and each of such new Series&nbsp;A Warrant Certificates shall represent such portion of such rights as is designated in writing by the Registered Holder at
the time of such surrender. The date the Company initially issues a Series&nbsp;A Warrant shall be deemed to be the "Date of Issuance" thereof regardless of the number of times new certificates
representing the unexpired and unexercised rights formerly represented by a Series&nbsp;A Warrant Certificate shall be issued. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2.
</FONT><FONT SIZE=2><I>Expenses</I></FONT><FONT SIZE=2>. The preparation, issuance and delivery of the new Series&nbsp;A Warrant Certificates under this Section&nbsp;4 shall be
at the Company's expense (other than transfer taxes). The Company shall not be required, however, to pay any tax or other charge imposed in connection with any transfer of any Series&nbsp;A
Warrants, including, but not limited to, any transfer involved in the exchange of any Series&nbsp;A Warrant Certificates under this Section&nbsp;4, and in such case the Company shall not be
required to issue or deliver any Series&nbsp;A Warrant Certificates until such tax or other charge has been paid or it has been established to the satisfaction of the Company that no such tax or
other charge is due. If such tax or other charge is due, the Warrant Agent shall have no duty or obligation under this Section&nbsp;4 or any other similar provision of this Warrant Agreement unless
and until it is satisfied that all such taxes and/or governmental charges have been paid in full. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3. </FONT> <FONT SIZE=2><I>Maintenance of Books</I></FONT><FONT SIZE=2>. The Company agrees to maintain, at the office or agency of the Warrant Agent as provided in Section&nbsp;11,
books for the registration and the registration of transfer of the Series&nbsp;A Warrants. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4.
</FONT><FONT SIZE=2><I>Transfer</I></FONT><FONT SIZE=2>. The Series&nbsp;A Warrants and all rights thereunder are transferable, in whole or in part, without charge to the
Registered Holders, upon surrender of a Series&nbsp;A Warrant Certificate with a properly executed Assignment (in the form of </FONT><FONT SIZE=2><I>Exhibit&nbsp;II  </I></FONT><FONT SIZE=2>attached to the Series&nbsp;A Warrant Certificates) at the
office or agency of the Warrant Agent as provided Section&nbsp;11. Upon any partial transfer, the Warrant Agent
shall promptly issue and deliver to the Registered Holder thereof a new Series&nbsp;A Warrant Certificate of like tenor, in the name of the Registered Holder thereof, which shall be exercisable for
such number of shares of Series&nbsp;A Warrant Stock which were not so transferred in accordance with Section&nbsp;4.1. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.
</FONT><FONT SIZE=2><I>ADJUSTMENTS</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
order to prevent dilution of the rights granted under the Series&nbsp;A Warrants under certain circumstances, the number of shares of Class&nbsp;D Common for which each
Series&nbsp;A Warrant is exercisable, shall be subject to adjustment from time to time as set forth in the Series&nbsp;A Warrant Certificates. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. </FONT> <FONT SIZE=2><I>NOTICES OF AdJUSTMENT</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
soon as reasonably practicable after any adjustment of the Exercise Price or the number of shares of Class&nbsp;D Common for which the Series&nbsp;A Warrants are exercisable, and
in no event later than the date of the first Distribution Notice delivered thereafter, the Company shall give written notice thereof to the Registered Holders, setting forth in reasonable detail and
certifying the calculation of such adjustment. </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>6</FONT></P>

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<P><FONT SIZE=2><I>7. RESERVATION AND AUTHORIZATION OF COMMON STOCK; REGISTRATION WITH OR APPROVAL OF ANY GOVERNMENTAL AUTHORITY</I></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;From
and after the Closing Date, the Company shall at all times reserve and keep available for issue upon the exercise of Series&nbsp;A Warrants such number of authorized but unissued
shares of Class&nbsp;D Common as will be sufficient to permit the exercise in full of all outstanding Series&nbsp;A Warrants; </FONT><FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT> <FONT SIZE=2><I>however</I></FONT><FONT SIZE=2>, that if
(A)&nbsp;the number of shares of Class&nbsp;D Common issuable upon exercise of all outstanding Series&nbsp;A Warrants shall
increase after the date hereof as the result of any adjustment required pursuant to Section&nbsp;2 of the Series&nbsp;A Warrant Certificates (the increased number of shares issuable thereunder
being referred to herein as "Adjustment Shares") and (B)&nbsp;the Company, at the time of such adjustment (or the transaction or other occurrence triggering such adjustment) does not have sufficient
authorized capital stock to reserve and keep available such additional number of shares of Class&nbsp;D Common as equals the number of Adjustment Shares, then the Company shall be permitted not to
reserve and keep available such additional number of shares of Class&nbsp;D Common as equals the number of Adjustment Shares until the earlier to occur of the date immediately preceding the date of
any Distribution Notice and the date that is forty-five (45)&nbsp;days after the Company's next annual meeting of shareholders. The Company shall not take any action that would cause it
to violate the requirements of the immediately preceding sentence. All shares of Class&nbsp;D Common which shall be so issuable, when issued upon exercise of any Series&nbsp;A Warrant and payment
therefor in accordance with the terms thereof and of this Warrant Agreement, shall be duly and validly issued and fully paid and nonassessable, not subject to preemptive rights, and free from all
taxes, liens, charges, security interests, encumbrances and other restrictions created by or through the Company. The Company shall from time to time take all such action as may be necessary to assure
that the par value per share of the unissued Class&nbsp;D Common acquirable upon exercise of the Series&nbsp;A Warrants is at all times equal to or less than the Exercise Price then in effect. The
Company shall take all such actions as may be necessary to assure that all such shares of Class&nbsp;D Common may be so issued without violation of any applicable law or governmental regulation or
any requirements of any domestic securities exchange upon which shares of Common Stock may be listed (except for official notice of issuance which shall be immediately delivered by the Company upon
each such issuance). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
any shares of Class&nbsp;D Common required to be reserved for issuance upon exercise of Series&nbsp;A Warrants require registration or qualification with any governmental
authority or other governmental approval or filing under any federal law before such shares may be so issued, the Company will in good faith (subject to all applicable laws including, without
limitation, those rules and regulations promulgated under the Securities Act) and as expeditiously as possible and at its expense endeavor to cause such shares to be duly registered. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. </FONT> <FONT SIZE=2><I>STOCK AND WARRANT TRANSFER BOOKS</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prior
to the delivery of a Distribution Notice, the Company shall not close its books against the transfer of the Series&nbsp;A Warrants or of any share of Class&nbsp;D Common issued
or issuable upon the exercise of the Series&nbsp;A Warrants in any manner which interferes with the timely exercise of the Series&nbsp;A Warrants. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.
</FONT><FONT SIZE=2><I>SUPPLYING INFORMATION</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company shall reasonably cooperate with each Registered Holder of a Series&nbsp;A Warrant and each holder of Series&nbsp;A Warrant Stock in supplying such information as may be
reasonably necessary for such holder to complete and file any information reporting forms presently or hereafter required by the Commission as a condition to the availability of an exemption from the
Securities Act for the sale of any Series&nbsp;A Warrant or Series&nbsp;A Warrant Stock. </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>7</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. </FONT> <FONT SIZE=2><I>LOSS OR MUTILATION</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon
receipt of evidence reasonably satisfactory to the Company (an affidavit of the Registered Holder shall be satisfactory) of the ownership and the loss, theft, destruction or
mutilation of any certificate evidencing a Series&nbsp;A Warrant Certificate, and in the case of any such loss, theft or destruction, upon receipt of indemnity reasonably satisfactory to the Company
(provided that if the holder is a financial institution or other institutional investor its own agreement shall be satisfactory), or, in the case of any such mutilation upon surrender of such
certificate, the Company shall (at its expense) execute and deliver in lieu of such certificate a new certificate of like kind representing the same rights represented by such lost, stolen, destroyed
or mutilated certificate and dated the date of such lost, stolen, destroyed or mutilated certificate. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.
</FONT><FONT SIZE=2><I>OFFICE OF COMPANY</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
long as any of the Series&nbsp;A Warrants remain outstanding, the Warrant Agent, on behalf of the Company, shall maintain an office or agency (which shall be the principal executive
offices of the Warrant Agent) where the Series&nbsp;A Warrants may be presented for exercise, registration of transfer or exchange as provided in this Warrant Agreement. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.
</FONT><FONT SIZE=2><I>LIMITATION OF LIABILITY</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No
provision hereof, in the absence of affirmative action by a Registered Holder to purchase shares of Class&nbsp;D Common, and no enumeration herein of the rights or privileges of a
Registered Holder hereof, shall give rise to any liability of such Registered Holder for the purchase price of any Class&nbsp;D Common or as a stockholder of the Company, whether such liability is
asserted by the Company or by creditors of the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Series&nbsp;A Warrants shall not entitle the Registered Holders to any voting rights or other rights as a stockholder of the Company. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.
</FONT><FONT SIZE=2><I>CONCERNING THE WARRANT AGENT</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Warrant Agent undertakes the duties and obligations imposed by this Warrant Agreement upon the following terms and conditions, by all of which the Company and the Registered Holders,
by their acceptance of the Series&nbsp;A Warrants, shall be bound: </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.1. </FONT> <FONT SIZE=2><I>Correctness of Statement</I></FONT><FONT SIZE=2>. The statements contained herein and in the Series&nbsp;A Warrant Certificates shall be taken as
statements of the Company, and the Warrant Agent assumes no responsibility for the correctness of any of the same except such as describe the Warrant Agent or action to be taken by it. The Warrant
Agent assumes no responsibility with respect to the distribution of the Series&nbsp;A Warrant Certificates except as herein otherwise provided. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.2.
</FONT><FONT SIZE=2><I>Breach of Covenants</I></FONT><FONT SIZE=2>. The Warrant Agent shall not be responsible for any failure of the Company to comply with any of the covenants
contained in this Warrant Agreement or in the Series&nbsp;A Warrant Certificates to be complied with by the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.3.
</FONT><FONT SIZE=2><I>Reliance on Counsel</I></FONT><FONT SIZE=2>. The Warrant Agent may consult at any time with counsel satisfactory to it (who may be counsel for the Company)
and the Warrant Agent shall incur no liability or responsibility
to the Company or to any Registered Holder in respect of any action taken, suffered or omitted by it hereunder in good faith and in accordance with the opinion or the advice of such counsel. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.4. </FONT> <FONT SIZE=2><I>Reliance on Documents</I></FONT><FONT SIZE=2>. The Warrant Agent shall incur no liability or responsibility to the Company or to any Registered Holder for
any action taken, suffered or omitted in reliance on any Series&nbsp;A Warrant Certificate, certificate of shares, notice, resolution, waiver, consent, order certificate, or other paper, document or
instrument believed by it to be genuine and to have signed, sent or presented by the proper party or parties. </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>8</FONT></P>

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<BR>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.5. </FONT> <FONT SIZE=2><I>Compensation and Indemnification</I></FONT><FONT SIZE=2>. The Company agrees to pay to the Warrant Agent reasonable compensation for all services rendered
by the Warrant Agent in the execution of this Warrant Agreement, to reimburse the Warrant Agent for all expenses, taxes and governmental charges and other charges of any kind and nature incurred by
the Warrant Agent in the execution of this Warrant Agreement and, to indemnify the Warrant Agent and save it harmless against any and all liabilities, including judgments, costs and counsel fees, for
anything done or omitted by the Warrant Agent in the execution of its duties and powers under this Warrant Agreement, except for such liabilities that arise as a result of the Warrant Agent's
negligence, willful misconduct or bad faith. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.6. </FONT> <FONT SIZE=2><I>Legal Proceedings</I></FONT><FONT SIZE=2>. The Warrant Agent shall be under no obligation to institute any action, suit or legal proceeding or to take any
other action likely to involve expense unless the Company or one or more Registered Holders shall furnish the Warrant Agent with reasonable security and indemnity for any costs and expenses which may
be incurred, but this provision shall not affect the power of the Warrant Agent to take such action as it may consider proper, whether with or without any such security indemnity. All rights of action
under this Warrant Agreement or under any of the Series&nbsp;A Warrant Certificates may be enforced by the Warrant Agent without possession of any of the Series&nbsp;A Warrant Certificates or the
production thereof at any trial or other proceeding relative thereto, and any such action, suit or proceeding instituted by the Warrant Agent shall be brought in its name as Warrant Agent, and any
recovery of judgment shall be for the ratable benefit of the Holders, as their respective rights or interests may appear. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.7.
</FONT><FONT SIZE=2><I>Other Transactions in Securities of the Company</I></FONT><FONT SIZE=2>. Except as prohibited by law, the Warrant Agent, and any stockholder, director,
officer or employee of it, may buy, sell or deal in any of the Series&nbsp;A Warrants or other securities of the Company or become pecuniarily interested in any transaction in which the Company may
be interested, or contract with or lend money to the Company or otherwise act as fully and freely as though it were not Warrant Agent under this Warrant Agreement. Nothing herein shall preclude the
Warrant Agent from acting in any other capacity for the Company or for any other legal entity. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.8.
</FONT><FONT SIZE=2><I>Liability of Warrant Agent</I></FONT><FONT SIZE=2>. The Warrant Agent shall act hereunder solely as agent for the Company, and its duties shall be
determined solely by the provisions hereof. The Warrant Agent shall
not be liable for anything which it may do or refrain from doing in connection with this Warrant Agreement except for its own negligence, willful misconduct or bad faith. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.9. </FONT> <FONT SIZE=2><I>Adjustments</I></FONT><FONT SIZE=2>. The Warrant Agent shall not at any time be under any duty or responsibility to any Holder to make or cause to be made
any adjustment of the Exercise Price or number of shares of Series&nbsp;A Warrant Stock deliverable as provided in this Warrant Agreement, or to determine whether any facts exist which may require
any of such adjustments, or with respect to the nature or extent of any such adjustments, when made, or with respect to the method employed in making the same. The Warrant Agent shall not be
accountable with respect to the validity or value or the kind or amount of any shares of Series&nbsp;A Warrant Stock or of any securities or property which may at any time be issued or delivered
upon the exercise of any Series&nbsp;A Warrant or with respect to whether any such shares of Series&nbsp;A Warrant Stock or other securities will be, when issued, validly issued, fully paid and
nonassessable, and makes no representation with respect thereto. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.10.
</FONT><FONT SIZE=2><I>Resignation and Removal</I></FONT><FONT SIZE=2>. The Warrant Agent may resign at any time by so notifying the Company in writing. The Company may remove
the Warrant Agent by so notifying the Warrant Agent in writing and may appoint a successor Warrant Agent. If the Warrant Agent resigns or is removed or if a vacancy exists in the office of Warrant
Agent for any reason (the Warrant Agent in such event being referred to herein as the retiring Warrant Agent), the Company shall promptly appoint a successor Warrant Agent. A successor Warrant Agent
shall deliver a written acceptance </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>9</FONT></P>

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<UL>
<BR>

<P><FONT SIZE=2>
of its appointment to the retiring Warrant Agent and to the Company. As promptly as practicable after that, the retiring Warrant Agent shall transfer, after payment of all sums then owing to the
Warrant Agent, all property held by it as Warrant Agent to the successor Warrant Agent, the resignation or removal of the retiring Warrant Agent shall become effective, and the successor Warrant Agent
shall have the rights, powers and duties of the Warrant Agent under this Agreement. A successor Warrant Agent shall mail notice of its succession to each Registered Holder. If a successor Warrant
Agent does not take office within 60&nbsp;days after the retiring Warrant Agent resigns or is removed, the retiring Warrant Agent or the Company may petition, at the expense of the Company, any
court of competent jurisdiction for the appointment of a successor Warrant Agent. Notwithstanding replacement of the Warrant Agent pursuant to this Section&nbsp;13.10, the Company's obligations
under Section&nbsp;13.5 shall continue for the benefit of the retiring Warrant Agent. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.
</FONT><FONT SIZE=2><I>MISCELLANEOUS</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.1. </FONT> <FONT SIZE=2><I>Nonwaiver</I></FONT><FONT SIZE=2>. No course of dealing or any delay or failure to exercise any right hereunder on the part of any Holder shall operate as a
waiver of such right or otherwise prejudice Holder's rights, powers or remedies. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2.
</FONT><FONT SIZE=2><I>Notice Generally</I></FONT><FONT SIZE=2>. Except as otherwise expressly provided herein, all notices referred to in this Agreement shall be in writing and
shall be delivered personally, sent by reputable overnight courier service (charges prepaid) or sent by registered or certified mail, return receipt requested, postage
prepaid and shall be deemed to have been given when so delivered, sent or deposited in the U.S. Mail, addressed as follows: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;If
to any Registered Holder or holder of Series&nbsp;A Warrant Stock, at such Registered Holder's address as it appears in the records of the Company maintained by the
Warrant Agent for such purpose; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;If
to the Warrant Agent, to Wachovia Bank, N.A., as Warrant Agent, Corporate Trust Group, Corporate Actions Department, 1525 West W.T. Harris Blvd., Bldg. 3C3,
Charlotte, NC 28262-1153 (overnight courier) 28288-1153 (first class mail); </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;If
to the Company, at its principal executive offices; </FONT></P>

</UL>

<P><FONT SIZE=2>or
at such other address as may be substituted by notice given as herein provided. The giving of any notice required hereunder may be waived in writing by the party entitled to receive such notice. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.3.
</FONT><FONT SIZE=2><I>Appointment of Warrant Agent</I></FONT><FONT SIZE=2>. The Company hereby appoints the Warrant Agent to act as agent for the Company in accordance with the
instructions set forth herein, and the Warrant Agent hereby accepts such appointment. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.4. </FONT> <FONT SIZE=2><I>Successors and Assigns</I></FONT><FONT SIZE=2>. This Warrant Agreement and the rights evidenced hereby shall inure to the benefit of and be binding upon the
successors of the Company, the Warrant Agent and the successors and assigns of each Registered Holder. The provisions of this Warrant Agreement are intended to be for the benefit of all Registered
Holders from time to time of a Series&nbsp;A Warrant or Series&nbsp;A Warrants and holders of Series&nbsp;A Warrant Stock, and shall be enforceable by any such Registered Holder or holder of
Series&nbsp;A Warrant Stock. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.5.
</FONT><FONT SIZE=2><I>Amendment</I></FONT><FONT SIZE=2>. The Company and the Warrant Agent may from time to time supplement or amend this Warrant Agreement without the approval
of any Registered Holders in order to cure any ambiguity or to correct or supplement any provision contained herein which may be defective or inconsistent with any other provision herein, or to make
any other provisions or change in regard to matters or questions arising hereunder which the Company and the Warrant Agent may </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>10</FONT></P>

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<UL>
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<P><FONT SIZE=2>
deem necessary or desirable and which shall not adversely affect the interests of any Registered Holder. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.6.
</FONT><FONT SIZE=2><I>Severability</I></FONT><FONT SIZE=2>. Wherever possible, each provision of this Warrant Agreement shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Warrant Agreement shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition
or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Warrant Agreement. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.7.
</FONT><FONT SIZE=2><I>Headings</I></FONT><FONT SIZE=2>. The headings used in this Warrant Agreement are for the convenience of reference only and shall not, for any purpose, be
deemed a part of this Warrant Agreement. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.8.
</FONT><FONT SIZE=2><I>Governing Law</I></FONT><FONT SIZE=2>. This Warrant Agreement shall be governed by the laws of the State of New York, without regard to the provisions
thereof relating to conflict of laws; provided however, that the corporation laws of the State of Delaware shall govern all issues concerning the relative rights of the Company and its stockholders. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>*
* * * * </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>11</FONT></P>

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<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN
WITNESS WHEREOF, the Company and the Warrant Agent have caused this Warrant Agreement to be duly executed as of the date first written above. </FONT></P>
</UL>
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<TABLE WIDTH="79%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=5><FONT SIZE=2>POLYMER GROUP,&nbsp;INC.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="43%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=3><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Name:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="43%"><FONT SIZE=2>James G. Boyd</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Title:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="43%"><FONT SIZE=2>Executive Vice President, Treasurer Chief Financial Officer and Director</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=5><FONT SIZE=2><BR>
WACHOVIA BANK, N.A.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="43%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=3><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Name:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="43%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Title:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="43%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
</TABLE>
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<P ALIGN="CENTER"><FONT SIZE=2>12</FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2>
EXHIBIT A<BR>
<BR>
FORM OF SERIES A WARRANT CERTIFICATE<BR>
<BR>
SERIES A WARRANT<BR>
<BR>
POLYMER GROUP,&nbsp;INC. </FONT></P>

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<TABLE WIDTH="100%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="TOP">
<TD WIDTH="20%" ALIGN="RIGHT"><FONT SIZE=2>Date of Issuance:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="29%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="18%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="20%" ALIGN="RIGHT"><FONT SIZE=2>Certificate No. W-</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="20%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="29%"><HR NOSHADE></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="18%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="20%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><HR NOSHADE></TD>
</TR>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FOR
VALUE RECEIVED, Polymer Group,&nbsp;Inc., a Delaware corporation (the "Company"), hereby grants to&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;or its
registered assigns (the "Registered Holder") the right to
purchase from the Company&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares of the Company's Class&nbsp;D Common at a price per share of $.01 (the "Exercise Price"). This Warrant is one of several warrants to purchase
Class&nbsp;D Common (collectively, the "Warrants") issued in connection with the Company's Second Amended Modified Joint Plan of Reorganization, dated as of January&nbsp;16, 2003 (the "Plan") and
pursuant to the terms of a Warrant Agreement, dated as of March&nbsp;5, 2003, between the Company and Wachovia Bank, N.A. Certain capitalized terms used herein are defined in Section&nbsp;3
hereof. The amount and kind of securities obtainable pursuant to the rights granted hereunder are subject to adjustment pursuant to the provisions contained in this Warrant. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
Warrant is subject to the following provisions: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.
</FONT><FONT SIZE=2><I>EXERCISE OF WARRANT</I></FONT><FONT SIZE=2>. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1.
</FONT><FONT SIZE=2><I>Exercise Period</I></FONT><FONT SIZE=2>. The Registered Holder may exercise, in whole or in part, the purchase rights represented by this Warrant at any time
and from time to time after the delivery by the Company of a Distribution Notice (as defined below) to the Registered Holder up to and including the Termination Date (as defined below) (the "Exercise
Period"). The purchase rights represented by this Warrant shall not be exercisable until the Company delivers a Distribution Notice. The Company shall give the Registered Holder written notice thirty
(30)&nbsp;calendar days prior to any Distribution (as defined in the Company's Amended and Restated Certificate of Incorporation) or consummation of a Change in
Control in which an outstanding share of Class&nbsp;D Common would be entitled to participate pursuant to the terms of the Company's Amended and Restated Certificate of Incorporation (a
"Distribution Notice"). This Warrant, the purchase rights represented hereby, all of the Company's obligations hereunder and any other rights of the Registered Holder hereunder shall terminate upon
the earlier to occur of (i)&nbsp;the close of business on March&nbsp;4, 2010, and (ii)&nbsp;the business day immediately preceding the consummation of a Change of Control (collectively, the
"Termination Date"). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2.
</FONT><FONT SIZE=2><I>Exercise Procedure</I></FONT><FONT SIZE=2>. </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;This
Warrant shall be deemed to have been exercised when the Company has received all of the following items (the "Exercise Time"): </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;a
completed Exercise Agreement, as described in Section&nbsp;1.3 below, executed by the Person exercising all or part of the purchase rights represented by this
Warrant (the "Purchaser"); </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;this
Warrant; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;if
this Warrant is not registered in the name of the Purchaser, an Assignment or Assignments in the form set forth in Exhibit&nbsp;II hereto evidencing the
assignment of this Warrant to the Purchaser, in which case the Registered Holder shall have complied with the provisions set forth in Section&nbsp;5 hereof; and </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;either
(1)&nbsp;a check payable to the Company in an amount equal to the product of the Exercise Price multiplied by the number of shares of Class&nbsp;D Common
being </FONT></P>

</UL>
</UL>
</UL>
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purchased upon such exercise (the "Aggregate Exercise Price"), or (2)&nbsp;a written notice to the Company that the Purchaser is exercising the Warrant (or a portion thereof) by authorizing the
Company to withhold from issuance a number of shares of Class&nbsp;D Common issuable upon such exercise of the Warrant which when multiplied by the Current Market Price of the Common Stock is equal
to the Aggregate Exercise Price (and such withheld shares shall no longer be issuable under this Warrant). </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;Certificates
for shares of Class&nbsp;D Common purchased upon exercise of this Warrant shall be delivered by the Company or the Warrant Agent to the Purchaser within
three business days after the
date of the Exercise Time. Unless this Warrant has expired or all of the purchase rights represented hereby have been exercised, the Company or the Warrant Agent shall prepare a new Warrant,
substantially identical hereto, representing the rights formerly represented by this Warrant which have not expired or been exercised and shall, within such three-day period, deliver such
new Warrant to the Person designated for delivery in the Exercise Agreement; </FONT><FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT><FONT SIZE=2><I>however</I></FONT><FONT SIZE=2>, that if
(A)&nbsp;this Warrant is not exercised in the name of the Purchaser and (B)&nbsp;the Assignment or Assignments delivered to the Company herewith are for less than all of the rights formerly
represented by this Warrant, then a new Warrant, substantially identical hereto, representing the rights formerly represented by this Warrant which have not expired or been exercised and which were
not assigned pursuant to the Assignment or Assignments delivered to the Company shall, within such three-day period, be delivered by the Company or the Warrant Agent to the Registered
Holder and a new Warrant, substantially identical hereto, representing the rights formerly represented by this Warrant which have not expired or been exercised and which were assigned pursuant to the
Assignment or Assignment delivered to the Company shall, within such three-day period, be delivered by the Company or the Warrant Agent to the Person designated for delivery in the
Exercise Agreement. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;Notwithstanding
anything to the contrary herein, the exercise of this Warrant upon the delivery of a Distribution Notice shall not be deemed effective, the
Class&nbsp;D Common issuable upon the exercise of this Warrant shall not be deemed to have been issued to the Purchaser, and the Purchaser shall not be deemed to have become the record holder of
such Class&nbsp;D Common until immediately prior to the occurrence of the Distribution that was the subject of such Distribution Notice; </FONT><FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT> <FONT SIZE=2><I>however</I></FONT><FONT SIZE=2>,
that if the Distribution that was the subject of such Distribution Notice will result from a Change of Control, the exercise of this Warrant
shall be deemed effective, the Class&nbsp;D Common issuable upon the exercise of this Warrant shall be deemed to have been issued to the Purchaser, and the Purchaser shall be deemed to have become
the record holder of such Class&nbsp;D Common immediately prior to the consummation of such Change in Control. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;The
issuance of certificates for shares of Class&nbsp;D Common upon exercise of this Warrant shall be made without charge to the Registered Holder or the Purchaser for
any issuance tax in respect thereof or other cost incurred by the Company in connection with such exercise and the related issuance of shares of Class&nbsp;D Common. Each share of Class&nbsp;D
Common issuable upon exercise of this Warrant shall, upon payment of the Exercise Price therefor, be fully paid and nonassessable and free from all liens and charges with respect to the issuance
thereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;Prior
to the delivery of a Distribution Notice, the Company shall not close its books against the transfer of this Warrant or of any share of Class&nbsp;D Common
issued or issuable upon the exercise of this Warrant in any manner which interferes with the timely exercise of this Warrant. The Company shall from time to time take all such action as may be
necessary to assure that the par value per share of the unissued Class&nbsp;D Common acquirable upon exercise of this Warrant is at all times equal to or less than the Exercise Price then in effect. </FONT></P>

</UL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>2</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;The
Company shall at all times reserve and keep available out of its authorized but unissued shares of Class&nbsp;D Common solely for the purpose of issuance upon the
exercise of the Warrants, such number of shares of Class&nbsp;D Common issuable upon the exercise of all outstanding Warrants; </FONT><FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT> <FONT SIZE=2><I>however</I></FONT><FONT SIZE=2>, that if
(A)&nbsp;the number of shares of Class&nbsp;D Common issuable upon exercise of all outstanding Warrants shall increase after the
Date of Issuance as the result of any adjustment required pursuant to Section&nbsp;2 (the increased number of shares issuable hereunder being referred to herein as "Adjustment Shares") and
(B)&nbsp;the Company, at the time of such adjustment (or the transaction or other occurrence triggering such adjustment) does not have sufficient authorized capital stock to reserve and keep
available such additional number of shares of Class&nbsp;D Common as equals the number of Adjustment Shares, then the Company shall be permitted not to reserve and keep available such additional
number of shares of Class&nbsp;D Common as equals the number of Adjustment Shares until the earlier to occur of the date immediately preceding the date of any Distribution Notice and the date that
is forty-five (45)&nbsp;days after the Company's next annual meeting of shareholders. All shares of Class&nbsp;D Common which are so issuable shall, when issued, be duly and validly
issued, fully paid and nonassessable and free from all taxes, liens and charges. The Company shall take all such actions as may be necessary to assure that all such shares of Class&nbsp;D Common may
be so issued without violation of any applicable law or governmental regulation or any requirements of any domestic securities exchange upon which shares of Common Stock may be listed (except for
official notice of issuance which shall be immediately delivered by the Company upon each such issuance). The Company shall not take any action that would cause it to violate the requirements of the
first sentence of this Section&nbsp;1.2(f). </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3.
</FONT><FONT SIZE=2><I>Exercise Agreement</I></FONT><FONT SIZE=2>. Upon any exercise of this Warrant, the Exercise Agreement shall be substantially in the form set forth in </FONT> <FONT SIZE=2><I>Exhibit&nbsp;I </I></FONT><FONT SIZE=2>hereto, except
that if the shares of Class&nbsp;D Common are not to be issued in the name of the Person in whose name this Warrant is
registered, the Exercise Agreement shall also state the name of the Person to whom the certificates for the shares of Class&nbsp;D Common are to be issued, and if the number of shares of
Class&nbsp;D Common to be issued does not include all the shares of Class&nbsp;D Common purchasable hereunder, it shall also state the name of the Person to whom a new Warrant for the unexercised
portion of the rights hereunder is to be delivered. Such Exercise Agreement shall be dated the actual date of execution thereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.
</FONT><FONT SIZE=2><I>ADJUSTMENT OF NUMBER OF SHARES</I></FONT><FONT SIZE=2>. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
order to prevent dilution of the rights granted under this Warrant under certain circumstances, the number of shares of Class&nbsp;D Common obtainable upon exercise of this Warrant
shall be subject to adjustment from time to time as provided in this Section&nbsp;2. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1.
</FONT><FONT SIZE=2><I>Stock Splits, Combinations. etc</I></FONT><FONT SIZE=2>. In case the Company shall hereafter (A)&nbsp;pay a dividend or make a distribution on its Common
Stock in shares of its capital stock (whether shares of Common Stock or of capital stock of any other class), (B)&nbsp;subdivide its outstanding shares of Common Stock or (C)&nbsp;combine its
outstanding shares of Common Stock into a smaller number of shares, the number of shares into which this Warrant is exercisable immediately following such action shall be adjusted so that the Holder
of any Warrant thereafter exercised shall be entitled to receive the number of shares of Class&nbsp;D Common of the Company that represents the same percentage of the outstanding Common Stock which
such Holder would have owned immediately prior to such action had such Warrant been exercised immediately prior thereto and had such dividend, distribution, subdivision, combination or
reclassification been made on a pro rata share-for-share basis. An adjustment made pursuant to this
Section shall become effective immediately after the record date in the case of a dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision,
combination or reclassification. If, as a result of an adjustment made pursuant to this Section, the Holder of any </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>3</FONT></P>

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Warrant thereafter exercised shall become entitled to receive shares of two or more classes of capital stock of the Company, the Board of Directors of the Company (whose determination shall be
conclusive) shall determine the allocation of the Exercise Price between or among shares of such classes of capital stock. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.
</FONT><FONT SIZE=2><I>Reclassification; Merger, Business Combination, etc</I></FONT><FONT SIZE=2>. In case of any reclassification of outstanding shares of Class&nbsp;D Common
issuable upon exercise of the Warrants (other than as set forth in Section&nbsp;2.1 above and other than a change in par value, or from par value to no par value, or from no par value to par value
or as a result of a subdivision or combination), or in the case of any merger, reorganization, restructuring, consolidation, share exchange, business combination, recapitalization or similar
transaction involving the Company in which the Company is not the surviving or resulting entity and which does not constitute a Change in Control, then the Company shall forthwith make lawful and
adequate provision whereby the Holder of such Warrant then outstanding shall have the right thereafter to receive on exercise of such Warrant the kind and amount of shares of stock and other
securities and property receivable upon such reclassification, merger, reorganization, restructuring, consolidation, share exchange, business combination, recapitalization or similar transaction by a
holder of the number of shares of Class&nbsp;D Common issuable upon exercise of such Warrant immediately prior to such reclassification, merger, reorganization, restructuring, consolidation, share
exchange business combination, recapitalization or similar transaction. The above provisions of this Section&nbsp;2.2 shall similarly apply to successive reclassifications, mergers, reorganizations,
restructurings, consolidations, share exchanges, business combinations, recapitalizations or similar transactions. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3.
</FONT><FONT SIZE=2><I>Issuance of Options or Convertible Securities at Below Current Market Price</I></FONT><FONT SIZE=2>. In the event the Company shall, at any time or from time
to time after the date hereof and prior to the Termination Date, issue, sell, distribute or otherwise grant in any manner to all holders of Common Stock any rights to subscribe for or to purchase, or
any warrants or options for the purchase of, Common Stock or any stock or securities convertible into or exchangeable for Common Stock (any such rights, warrants or options being herein called
"Section&nbsp;2.3 Options" and any such convertible or exchangeable stock or securities being herein called "Section&nbsp;2.3 Convertible Securities"), whether or not such Section&nbsp;2.3
Options or the rights to convert or exchange such Section&nbsp;2.3 Convertible Securities are immediately exercisable, and the price per share at which Common Stock is issuable upon the exercise of
such Section&nbsp;2.3 Options or upon the conversion or exchange of such Section&nbsp;2.3 Convertible Securities (determined by dividing (i)&nbsp;the aggregate amount, if any, received or
receivable by the Company as consideration for the issuance, sale, distribution or granting of such Section&nbsp;2.3 Options or any such Convertible Security, plus the minimum aggregate amount of
additional consideration, if any, payable to the Company upon the exercise of all such Section&nbsp;2.3 Options or upon conversion or exchange of all such Section&nbsp;2.3 Convertible Securities,
plus, in the case of rights, options or warrants to acquire Section&nbsp;2.3 Convertible Securities or convertible or exchangeable securities to acquire Section&nbsp;2.3 Options, the minimum
aggregate amount of additional consideration, if any, payable upon the conversion or exchange of all such Section&nbsp;2.3 Convertible Securities or exercise of all such Section&nbsp;2.3 Options,
as the case may be (the "Section&nbsp;2.3 Aggregate Issue Price"), by (ii)&nbsp;the total maximum number of shares of Common Stock issuable upon the exercise of all such Section&nbsp;2.3 Options
or upon the conversion or exchange of all such Section&nbsp;2.3 Convertible Securities or upon the conversion or
exchange of all Section&nbsp;2.3 Convertible Securities issuable upon the exercise of all options or warrants therefor or Section&nbsp;2.3 Options issuable upon the convertible or exchangeable
securities therefor) shall be less than the Current Market Price per share of Common Stock on the record date for the issuance, sale, distribution or granting of such Section&nbsp;2.3 Options or
Section&nbsp;2.3 Convertible Securities (any such event being herein called a "Section&nbsp;2.3 Triggering Derivative Issuance") then, effective upon such Section&nbsp;2.3 Triggering Derivative
Issuance, the number of shares of Class&nbsp;D Common for which this Warrant is </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>4</FONT></P>

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exercisable shall be adjusted to equal the product obtained by multiplying the number of shares of Class&nbsp;D Common for which this Warrant is exercisable immediately prior to such
Section&nbsp;2.3 Triggering Derivative Issuance by a fraction (A)&nbsp;the numerator of which shall be the number of shares of Common Stock outstanding immediately after such Section&nbsp;2.3
Triggering Derivative Issuance (calculated on a fully diluted basis, taking into account such Section&nbsp;2.3 Triggering Derivative Issuance and assuming the exercise of such Section&nbsp;2.3
Options or Section&nbsp;2.3 Convertible Securities, but excluding any adjustments to be made as a result thereof under the Warrants, the Series&nbsp;B Warrants or the Convertible Notes), and
(B)&nbsp;the denominator of which shall be the sum of (1)&nbsp;the number of shares of Common Stock outstanding immediately prior to such Section&nbsp;2.3 Triggering Derivative Issuance
(calculated on a fully diluted basis), and (2)&nbsp;the Section&nbsp;2.3 Aggregate Issuance Price divided by the Current Market Price. No additional adjustment of the Exercise Price shall be made
upon the actual exercise of such Section&nbsp;2.3 Options or upon conversion or exchange of such Section&nbsp;2.3 Convertible Securities or upon the conversion or exchange of the
Section&nbsp;2.3 Convertible Securities issuable upon the exercise of rights, warrants or options, or the exercise of Section&nbsp;2.3 Options issued upon the conversion or exchange of convertible
or exchangeable securities. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4. </FONT> <FONT SIZE=2><I>Issuance of Options or Convertible Securities at 25% Below Current Market Price</I></FONT><FONT SIZE=2>. In the event the Company shall, at any time or from
time to time after the date hereof and prior to the Termination Date, issue, sell, distribute or otherwise grant in any manner to any but not all holders of the Common Stock any rights to subscribe
for or to purchase, or any warrants or options for the purchase of, Common Stock or any stock or securities convertible into or exchangeable for Common Stock (any such rights, warrants or options
being herein called "Section&nbsp;2.4 Options" and any such convertible or exchangeable stock or securities being herein called "Section&nbsp;2.4 Convertible Securities"), whether or not such
Section&nbsp;2.4 Options or the rights to convert or exchange such Section&nbsp;2.4 Convertible Securities are immediately exercisable, and the price per share at which Common Stock is issuable
upon the exercise of such Section&nbsp;2.4 Options or upon the conversion or exchange of such Section&nbsp;2.4 Convertible Securities (determined by dividing (i)&nbsp;the aggregate amount, if
any, received or receivable by the Company as consideration for the issuance, sale, distribution or granting of such Section&nbsp;2.4 Options or any such Section&nbsp;2.4 Convertible Security,
plus the minimum aggregate amount of additional consideration, if any, payable to the Company upon the exercise of all such Section&nbsp;2.4 Options or upon conversion or exchange of all such
Section&nbsp;2.4 Convertible Securities, plus, in the case of rights, options or warrants to acquire Section&nbsp;2.4 Convertible Securities or convertible or exchangeable securities to acquire
Section&nbsp;2.4 Options, the minimum aggregate amount of additional consideration, if any, payable upon the conversion or exchange of all such Section&nbsp;2.4 Convertible Securities or exercise
of all such Section&nbsp;2.4 Options, as the case may be (the "Section&nbsp;2.4 Aggregate Issue Price"), by (ii)&nbsp;the total maximum number of shares of Common Stock issuable upon the
exercise of all such Section&nbsp;2.4 Options or upon the conversion or exchange of all such Section&nbsp;2.4 Convertible Securities or upon the conversion or exchange of all Section&nbsp;2.3
Convertible Securities issuable upon the exercise of all options or warrants therefor or Section&nbsp;2.3 Options issuable upon the convertible or exchangeable securities therefor) shall be less
than 75% of the Current Market Price per share of Common Stock on the record date for the issuance, sale, distribution or granting of such Section&nbsp;2.4 Options or Section&nbsp;2.4 Convertible
Securities (any such event being herein called a "Section&nbsp;2.4 Triggering Derivative
Issuance") then, effective upon such Section&nbsp;2.4 Triggering Derivative Issuance, the number of shares of Class&nbsp;D Common for which this Warrant is exercisable shall be adjusted to equal
the product obtained by multiplying the number of shares of Class&nbsp;D Common for which this Warrant is exercisable immediately prior to such Section&nbsp;2.4 Triggering Derivative Issuance by a
fraction (A)&nbsp;the numerator of which shall be the number of shares of Common Stock outstanding immediately after such Section&nbsp;2.4 Triggering Derivative Issuance (calculated on a fully
diluted basis, taking into account such Section&nbsp;2.4 Triggering </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>5</FONT></P>

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Derivative Issuance and assuming the exercise of such Section&nbsp;2.4 Options or Section&nbsp;2.4 Convertible Securities, but excluding any adjustments to be made as a result thereof under the
Warrants, the Series&nbsp;B Warrants or the Convertible Notes), and (B)&nbsp;the denominator of which shall be the sum of (1)&nbsp;the number of shares of Common Stock outstanding immediately
prior to such Section&nbsp;2.4 Triggering Derivative Issuance (calculated on a fully diluted basis), and (2)&nbsp;the Section&nbsp;2.4 Aggregate Issuance Price divided by the Current Market
Price. No additional adjustment of the Exercise Price shall be made upon the actual exercise of such Section&nbsp;2.4 Options or upon conversion or exchange of such Section&nbsp;2.4 Convertible
Securities or upon the conversion or exchange of the Section&nbsp;2.4 Convertible Securities issuable upon the exercise of rights, warrants or options, or the exercise of Section&nbsp;2.4 Options
issued upon the conversion or exchange of convertible or exchangeable securities. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5.
</FONT><FONT SIZE=2><I>Issuance of Additional Shares of Common Stock at Below Current Market Price</I></FONT><FONT SIZE=2>. If at any time the Company shall (except as hereinafter
provided) issue or sell any additional shares of Common Stock in a transaction that was offered to all holders of Common Stock then outstanding for consideration in an amount per additional share of
Common Stock less than the Current Market Price, then the number of shares of Class&nbsp;D Common for which this Warrant is exercisable shall be adjusted to equal the product obtained by multiplying
the number of shares of Class&nbsp;D Common for which this Warrant is exercisable immediately prior to such issue or sale by a fraction (A)&nbsp;the numerator of which shall be the number of
shares of Common Stock outstanding immediately after such issue or sale (calculated on a fully diluted basis, taking into account such issue or sale, but excluding any adjustments to be made as a
result thereof under the Warrants, the Series&nbsp;B Warrants or the Convertible Notes), and (B)&nbsp;the denominator of which shall be the sum of (1)&nbsp;the number of shares of Common Stock
outstanding immediately prior to such issue or sale (calculated on a fully diluted basis), and (2)&nbsp;the aggregate consideration received from the issuance or sale of the additional shares of
Common Stock divided by the Current Market Price. For the purposes of this Section&nbsp;2.5, the date as of which the Current Market Price per share of Common Stock shall be computed shall be the
earlier of (a)&nbsp;the date on which the Company shall enter into a firm contract for the issuance of such additional shares of Common Stock or (b)&nbsp;the date of actual issuance of such
additional shares of Common Stock. Notwithstanding the foregoing, no adjustment shall be made under this Section for issuances of shares of Common Stock (i)&nbsp;upon exercise of the Warrants,
(ii)&nbsp;upon conversion of the outstanding Convertible Notes, (iii)&nbsp;upon exercise, conversion or exchange of any Section&nbsp;2.3 Options, Section&nbsp;2.4 Options, Section&nbsp;2.3
Convertible Securities or Section&nbsp;2.4 Convertible Securities, or (iv)&nbsp;in the event that the issuance of Common Stock giving rise to such adjustment is part of a transaction in which the
holder of this Warrant is given the opportunity to purchase such shares of Common Stock at the same price per share as all other offerees in the offering and on a pro rata
share-for-share basis with all other offerees. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.6.
</FONT><FONT SIZE=2><I>Issuance of Additional Shares of Common Stock at 25% Below Current Market Price</I></FONT><FONT SIZE=2>. If at any time the Company shall (except as
hereinafter provided) issue or sell any additional shares of Common Stock other than in a transaction that was offered to all holders of Common Stock then outstanding for consideration in an amount
per additional share of Common Stock less than 75% of the Current
Market Price, then the number of shares of Class&nbsp;D Common for which this Warrant is exercisable shall be adjusted to equal the product obtained by multiplying the number of shares of
Class&nbsp;D Common for which this Warrant is exercisable immediately prior to such issue or sale by a fraction (A)&nbsp;the numerator of which shall be the number of shares of Common Stock
outstanding immediately after such issue or sale (calculated on a fully diluted basis, taking into account such issue or sale, but excluding any adjustments to be made as a result thereof under the
Warrants, the Series&nbsp;B Warrants or the Convertible Notes), and (B)&nbsp;the denominator of which shall be the sum of (1)&nbsp;the number of shares of Common Stock outstanding immediately
prior to such issue or sale (calculated on a fully diluted basis), and (2)&nbsp;the aggregate consideration received </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>6</FONT></P>

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<P><FONT SIZE=2>
from the issuance or sale of the additional shares of Common Stock divided by the Current Market Price. For the purposes of this Section&nbsp;2.6, the date as of which the Current Market Price per
share of Common Stock shall be computed shall be the earlier of (a)&nbsp;the date on which the Company shall enter into a firm contract for the issuance of such additional shares of Common Stock or
(b)&nbsp;the date of actual issuance of such additional shares of Common Stock. Notwithstanding the foregoing, no adjustment shall be made under this Section for issuances of shares of Common Stock
(i)&nbsp;upon exercise of the Warrants, (ii)&nbsp;upon conversion of the Convertible Notes, (iii)&nbsp;upon exercise, conversion or exchange of any Section&nbsp;2.3 Options, Section&nbsp;2.4
Options, Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities, or (iv)&nbsp;in the event that the issuance of Common Stock giving rise to such adjustment is part of
a transaction in which the holder of this Warrant is given the opportunity to purchase such shares of Common Stock at the same price per share as all other offerees in the offering and on a pro rata
share-for-share basis with all other offerees. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.7.
</FONT><FONT SIZE=2><I>Certain Other Distributions</I></FONT><FONT SIZE=2>. If the Company shall pay a dividend or make any other distribution payable in Section&nbsp;2.3
Options, Section&nbsp;2.4 Options, Section&nbsp;2.3 Convertible Securities and Section&nbsp;2.4 Convertible Securities, then, for purposes of Sections 2.3 and 2.4 above, such Section&nbsp;2.3
Options, Section&nbsp;2.4 Options, Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities shall be deemed to have been issued or sold without consideration. Nothing
in this Section&nbsp;2.7 is intended to alter the component involving the exercise price contained in the calculations under Sections 2.3 or 2.4 with respect to any Section&nbsp;2.3 Options,
Section&nbsp;2.3 Convertible Securities, Section&nbsp;2.4 Options or Section&nbsp;2.4 Convertible Securities that are issued with an exercise price. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.8.
</FONT><FONT SIZE=2><I>Consideration Received</I></FONT><FONT SIZE=2>. If any shares of Common Stock, Section&nbsp;2.3 Options, Section&nbsp;2.4 Options, Section&nbsp;2.3
Convertible Securities or Section&nbsp;2.4 Convertible Securities shall be issued, sold or distributed for a consideration other than cash, the amount of the consideration other than cash received
by the Company in respect thereof shall be deemed to be the then fair market value of such consideration (as determined in good faith by the Board of Directors of the Company). If any
Section&nbsp;2.3 Options, Section&nbsp;2.3 Options, Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities shall be issued in connection with the issuance and sale
of other securities of the Company, together comprising one integral transaction in which no specific consideration is allocated to such Section&nbsp;2.3 Options, Section&nbsp;2.4 Options,
Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities by the parties thereto, such Section&nbsp;2.3 Options, Section&nbsp;2.4 Options, Section&nbsp;2.3
Convertible Securities or Section&nbsp;2.4 Convertible Securities shall be deemed to have been issued without consideration; provided, however, that if such Section&nbsp;2.3 Options,
Section&nbsp;2.4 Options, Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities have an exercise price equal to or greater than the Current Market Price of the
Common Stock on the date of issuance of such Section&nbsp;2.3 Options, Section&nbsp;2.4 Options, Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities, then such
Section&nbsp;2.3 Options, Section&nbsp;2.4 Options, Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities shall be deemed to have
been issued for consideration equal to such exercise price. Nothing in this Section&nbsp;2H is intended to alter the component involving the exercise price contained in the calculations under
Sections 2.3 or 2.4 with respect to any Section&nbsp;2.3 Options, Section&nbsp;2.3 Convertible Securities, Section&nbsp;2.4 Options or Section&nbsp;2.4 Convertible Securities that are issued
with an exercise price. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.9.
</FONT><FONT SIZE=2><I>Expiration of Options and Convertible Securities</I></FONT><FONT SIZE=2>. If, at any time after any adjustment to the number of shares of Class&nbsp;D
Common purchasable upon the exercise of each Warrant shall have been made pursuant to Sections 2.3 or 2.4 above or this Section&nbsp;2.9, any Section&nbsp;2.3 Options, Section&nbsp;2.4 Options,
Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities shall have expired unexercised, the number of such shares so purchasable shall, upon such expiration, be
readjusted and shall thereafter be such as they would have been had they been originally adjusted </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>7</FONT></P>

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<P><FONT SIZE=2>
(or had the original adjustment not been required, as the case may be) as if (i)&nbsp;the only shares of Common Stock deemed to have been issued in connection with such Section&nbsp;2.3 Options,
Section&nbsp;2.4 Options, Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities were the shares of Common Stock, if any, actually issued or sold upon the exercise of
such Section&nbsp;2.3 Options, Section&nbsp;2.4 Options, Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities and (ii)&nbsp;such shares of Common Stock, if any,
were issued or sold for the consideration actually received by the Company upon such exercise, conversion or exchange plus the aggregate consideration, if any, actually received by the Company for the
issuance, sale, distribution or granting of all such Section&nbsp;2.3 Options, Section&nbsp;2.4 Options, Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities,
whether or not exercised, plus, in the case of rights, options or warrants to acquire Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities or convertible or
exchangeable securities to acquire Section&nbsp;2.3 Options or Section&nbsp;2.4 Options, the minimum aggregate amount of additional consideration, if any, payable upon the exercise, conversion or
exchange of all such rights, options, warrants or convertible or exchangeable securities; provided that no such readjustment shall have the effect of decreasing the number of such shares so
purchasable by an amount (calculated by adjusting such decrease to account for all other adjustments made pursuant to this Section&nbsp;2 following the date of the original adjustment referred to
above) in excess of the amount of the adjustment initially made in respect of the issuance, sale, distribution or granting of such Section&nbsp;2.3 Options, Section&nbsp;2.4 Options,
Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.10.
</FONT><FONT SIZE=2><I>Notice</I></FONT><FONT SIZE=2>. As soon as reasonably practicable after any adjustment of the Exercise Price or the number of shares of Class&nbsp;D
Common for which this Warrant is exercisable, and in no event later than the date of the first Distribution Notice delivered thereafter, the Company shall give written notice thereof to the Registered
Holder, setting forth in reasonable detail and certifying the calculation of such adjustment. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.11.
</FONT><FONT SIZE=2><I>Other Adjustments</I></FONT><FONT SIZE=2>. In the event that at any time, as a result of an adjustment made pursuant to this Section&nbsp;2, the Holders
shall become entitled to receive any securities of the Company other than shares of Common Stock, thereafter the number of such other securities so receivable upon exercise of the Warrants and the
Exercise Price applicable to such exercise shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to the shares of
Common Stock contained in this Section&nbsp;2. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.
</FONT><FONT SIZE=2><I>DEFINITIONS</I></FONT><FONT SIZE=2>. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following terms have meanings set forth below: </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Affiliate</I></FONT><FONT SIZE=2>" of any Person shall mean any Person, directly or indirectly, through one or more intermediaries, controlling, controlled by,
or under common control with such Person. The term "control," as used in the immediately preceding sentence, shall mean with respect to a corporation or limited liability company, the right to
exercise, directly or indirectly, more than fifty percent (50%) of the voting rights attributable to the controlled corporation or limited liability company, and, with respect to any individual,
partnership, trust, other entity or association, the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of the controlled entity or the
actions of the individual, as the case may be. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Change of Control</I></FONT><FONT SIZE=2>" means (i)&nbsp;a merger, reorganization, restructuring, consolidation, share exchange, business combination,
recapitalization, liquidation, dissolution or similar transaction involving the Company in which the Company is not the surviving or resulting entity, as a result of which the Company's stockholders
prior to such transactions, MatlinPatterson Global Opportunities Partners, L.P., any Affiliates of MatlinPatterson Global Opportunities Partners L.P. and any Group that includes as a member
MatlinPatterson Global Opportunities Partners L.P. or </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>8</FONT></P>

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any Affiliates of MatlinPatterson Global Opportunities Partners L.P. cease to own at least 50% of the voting securities of the entity surviving or resulting from such transaction (or the ultimate
parent entity thereof), or (ii)&nbsp;the acquisition, directly or indirectly, by any Person (other than MatlinPatterson Global Opportunities Partners L.P. or its Affiliates or any Group that
includes as a member MatlinPatterson Global Opportunities Partners L.P. or any Affiliates of MatlinPatterson Global Opportunities Partners L.P.) of 50% or more of the Company's voting securities
whether by merger, consolidation, share exchange, business combination, tender or exchange offer, issuance or sale of securities or otherwise, other than in any such transaction following which the
Company's stockholders prior to such transaction, MatlinPatterson Global Opportunities Partners, L.P., any Affiliates of MatlinPatterson Global Opportunities Partners, L.P. and any Group that includes
as a member MatlinPatterson Global Opportunities Partners, L.P. or any Affiliates of MatlinPatterson Global Opportunities Partners, L.P., continue to own at least 50% of the voting securities of the
entity surviving or resulting from such transaction (or the ultimate parent entity thereof). </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Class&nbsp;D Common</I></FONT><FONT SIZE=2>" means shares of the Company's Class&nbsp;D Common Stock, par value $.01 per share; provided that if there is a
change such that the securities issuable upon exercise of the Warrants are issued by an entity other than the Company or there is a change in the type or class of securities so issuable, then the term
"Class&nbsp;D Common" shall mean one share of the security issuable upon exercise of the Warrants if such security is issuable in shares, or shall mean the smallest unit in which such security is
issuable if such security is not issuable in shares. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Common Stock</I></FONT><FONT SIZE=2>" means, collectively, the Company's Class&nbsp;A Common Stock, the Company's Class&nbsp;B Common Stock, the Company's
Class&nbsp;C Common Stock, the Company's Class&nbsp;D Common Stock, the Company's Class&nbsp;E Common Stock and any capital stock of any class of the Company hereafter authorized which is not
limited to a fixed sum or percentage of par or stated value in respect to the rights of the holders thereof to participate in dividends or in the distribution of assets upon any liquidation,
dissolution or winding up of the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Convertible Notes</I></FONT><FONT SIZE=2>" means the $50,000,000 principal amount of 10% convertible subordinated notes due December&nbsp;2007 issued by the
Company pursuant to the Plan. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Current Market Price</I></FONT><FONT SIZE=2>" means, for the purpose of any computation of Current Market Price pursuant to this Warrant, the Current Market
Price per share of Common Stock at any date shall be the average of the daily closing sales prices for the shorter of (i)&nbsp;the 20 consecutive trading days ending on the last full trading day on
the exchange or market specified in the second succeeding sentence prior to the Time of Determination (as defined below) and (ii)&nbsp;the period commencing on the date next succeeding the first
public announcement of the issuance, sale, distribution or granting in question through such last full trading day prior to the Time of Determination; provided that in the case of a firm commitment
underwritten public offering, the Current Market Price shall mean the closing price of the Common Stock on the day of the pricing of such offering. The term "Time of Determination" as used herein
shall be the time and date of the earlier to occur of (A)&nbsp;the date as of which the Current Market Price is to be computed and (B)&nbsp;the last full trading day on such exchange or market
before the commencement of "ex-dividend" trading in the Common Stock relating to the event giving rise to the adjustment required by Sections 2.1, 2.2, 2.3, 2.4, 2.5 or 2.7. The closing
price for any day shall be the last reported sale price regular way or, in case no such reported sale takes place on such day, the average of the closing bid and asked prices regular way for such day,
in each case (1)&nbsp;on the principal national securities exchange on which the shares of Common Stock are listed or to which such shares are admitted to trading or (2)&nbsp;if the Common Stock
is not listed or admitted to trading on a national securities exchange, in the over-the-counter market as reported by the NASDAQ National Market or any comparable system or
(3)&nbsp;if the Common Stock is not listed on the NASDAQ National Market or a comparable system, the fair market value as determined in good faith by the Board of Directors of the Company for that
purpose. </FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2>9</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Exchange Act</I></FONT><FONT SIZE=2>" means the Securities Exchange Act of 1934, as amended. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Group</I></FONT><FONT SIZE=2>" means a "group" within the meaning of Section&nbsp;13(d)(3) of the Exchange Act. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Person</I></FONT><FONT SIZE=2>" means an individual, a partnership, a limited liability partnership, a joint venture, a corporation, a limited liability company,
a trust, an unincorporated organization, any other legal entity and a government or any department or agency thereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Series&nbsp;B Warrants</I></FONT><FONT SIZE=2>" means the Company's Series&nbsp;B Warrants to purchase Class&nbsp;E Common Stock, issued pursuant to the
Plan. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.
</FONT><FONT SIZE=2><I>NO VOTING RIGHTS; LIMITATIONS OF LIABILITY</I></FONT><FONT SIZE=2>. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
Warrant shall not entitle the holder hereof to any voting rights or other rights as a stockholder of the Company. No provision hereof, in the absence of affirmative action by the
Registered Holder to purchase Class&nbsp;D Common, and no enumeration herein of the rights or privileges of the Registered Holder shall give rise to any liability of such holder for the Exercise
Price of Class&nbsp;D Common acquirable by exercise hereof or as a stockholder of the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.
</FONT><FONT SIZE=2><I>WARRANT TRANSFERABLE</I></FONT><FONT SIZE=2>. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
Warrant and all rights hereunder are transferable, in whole or in part, without charge to the Registered Holder, upon surrender of this Warrant with a properly executed Assignment
(in the form of </FONT><FONT SIZE=2><I>Exhibit&nbsp;II </I></FONT><FONT SIZE=2>hereto) at the office or agency of the Warrant Agent. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.
</FONT><FONT SIZE=2><I>WARRANT EXCHANGEABLE FOR DIFFERENT DENOMINATIONS</I></FONT><FONT SIZE=2>. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
Warrant is exchangeable, upon the surrender hereof by the Registered Holder at the office or agency of the Warrant Agent, for new Warrants of like tenor representing in the
aggregate the purchase rights hereunder, and each of such new Warrants shall represent such portion of such rights as is designated by the Registered Holder at the time of such surrender. The date the
Company initially issues this Warrant shall be deemed to be the "Date of Issuance" hereof regardless of the number of times new certificates representing the unexpired and unexercised rights formerly
represented by this Warrant shall be issued. All Warrants representing portions of the rights hereunder are referred to herein as the "Warrants." </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.
</FONT><FONT SIZE=2><I>REPLACEMENT</I></FONT><FONT SIZE=2>. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon
receipt of evidence reasonably satisfactory to the Company (an affidavit of the Registered Holder shall be satisfactory) of the ownership and the loss, theft, destruction or
mutilation of any certificate evidencing this Warrant, and in the case of any such loss, theft or destruction, upon receipt of indemnity reasonably satisfactory to the Company (provided that if the
holder is a financial institution or other institutional investor its own agreement shall be satisfactory), or, in the case of any such mutilation upon surrender of such certificate, the Company shall
(at its expense) execute and deliver in
lieu of such certificate a new certificate of like kind representing the same rights represented by such lost, stolen, destroyed or mutilated certificate and dated the date of such lost, stolen,
destroyed or mutilated certificate. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.
</FONT><FONT SIZE=2><I>NOTICES</I></FONT><FONT SIZE=2>. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except
as otherwise expressly provided herein, all notices referred to in this Warrant shall be in writing and shall be delivered personally, sent by reputable overnight courier service
(charges prepaid) or sent by registered or certified mail, return receipt requested, postage prepaid and shall be deemed to have been given when so delivered, sent or deposited in the U.S. Mail
(i)&nbsp;to the Company, at its principal executive offices and (ii)&nbsp;to the Registered Holder of this Warrant, at such holder's address as it appears in the records of the Company (unless
otherwise indicated by any such holder). </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>10</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.
</FONT><FONT SIZE=2><I>AMENDMENT AND WAIVER</I></FONT><FONT SIZE=2>. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except
as otherwise provided herein, the provisions of all of the Warrants may be amended and the Company may take any action herein prohibited, or omit to perform any act herein
required to be performed by it, only if the Company has obtained the written consent of the Registered Holders of Warrants representing a majority of the shares of Class&nbsp;D Common obtainable
upon exercise of the Warrants; </FONT><FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT><FONT SIZE=2><I>however</I></FONT><FONT SIZE=2>, that the Company may amend the provisions of any
single Warrant with the written consent of the Registered Holder of such Warrant. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.
</FONT><FONT SIZE=2><I>DESCRIPTIVE HEADINGS; GOVERNING LAW</I></FONT><FONT SIZE=2>. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
descriptive headings of the several Sections and paragraphs of this Warrant are inserted for convenience only and do not constitute a part of this Warrant. The corporation laws of
the State of Delaware shall govern all issues concerning the relative rights of the Company and its stockholders. All other questions concerning the construction, validity, enforcement and
interpretation of this Warrant shall be governed by the internal law of the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of
New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>*
* * * * </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>11</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN
WITNESS WHEREOF, the Company has caused this Warrant to be signed and attested by its duly authorized officers under its corporate seal and to be dated the Date of Issuance hereof. </FONT></P>
</UL>
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<TD COLSPAN=3 VALIGN="TOP"><FONT SIZE=2>Countersigned and Registered:</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="TOP"><FONT SIZE=2><B>POLYMER GROUP, INC.</B></FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD COLSPAN=3 VALIGN="TOP"><FONT SIZE=2><BR>
WACHOVIA BANK, N.A., as<BR>
Warrant Agent</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="7%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2>By</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="7%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" ALIGN="CENTER" VALIGN="TOP"><HR NOSHADE></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="7%" VALIGN="TOP"><FONT SIZE=2>By:</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="7%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" ALIGN="CENTER" VALIGN="TOP"><HR NOSHADE><FONT SIZE=2> Authorized Signature</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
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<TD WIDTH="7%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2>Its</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="7%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" ALIGN="CENTER" VALIGN="TOP"><HR NOSHADE></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD COLSPAN=3 VALIGN="TOP"><FONT SIZE=2><B>[Corporate Seal]</B></FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD COLSPAN=3 VALIGN="TOP"><FONT SIZE=2><BR>
Attest:</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="7%" ALIGN="RIGHT" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD COLSPAN=3 ALIGN="CENTER" VALIGN="TOP"><BR><HR NOSHADE><FONT SIZE=2> Secretary<BR></FONT>
</TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
</TABLE>
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<P ALIGN="RIGHT"><FONT SIZE=2>EXHIBIT I </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>EXERCISE AGREEMENT </FONT></P>

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<TD WIDTH="50%"><FONT SIZE=2>To:</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2>Dated:</FONT></TD>
</TR>
</TABLE>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
undersigned, pursuant to the provisions set forth in the attached Warrant (Certificate No.&nbsp;W-&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;), hereby agrees to subscribe for the purchase of
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares of the Class&nbsp;D Common covered by such Warrant and makes payment herewith in full therefor at the price per share provided by such Warrant. </FONT></P>

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<TD WIDTH="43%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%"><FONT SIZE=2>Signature</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="43%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="43%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="43%" ALIGN="CENTER"><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="43%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="11%"><FONT SIZE=2><BR>
Address</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="43%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="43%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="43%" ALIGN="CENTER"><HR NOSHADE></TD>
</TR>
</TABLE>
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<BR>
<P><br><A NAME="03CHI1872_5">QuickLinks</A><br></P><!-- TOC_BEGIN -->
<UL>
<FONT SIZE=2><A HREF="#toc_ki1872_1">EXHIBIT 4.1</A></FONT><BR>
</UL>
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</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.2
<SEQUENCE>7
<FILENAME>a2104906zex-4_2.htm
<DESCRIPTION>EXHIBIT 4.2
<TEXT>
<HTML>
<HEAD>

</HEAD>
<BODY BGCOLOR="#FFFFFF" LINK=BLUE  VLINK=PURPLE>
<BR>
<FONT SIZE=3 ><A HREF="#03CHI1872_6">QuickLinks</A></FONT>
<font size=3> -- Click here to rapidly navigate through this document</font>
<!-- TOC_END -->
<P ALIGN="RIGHT"><FONT SIZE=2><A
NAME="kr1872_exhibit_4.2"> </A>
<A NAME="toc_kr1872_1"> </A>
<BR></FONT><FONT SIZE=2><B>EXHIBIT 4.2    <BR>  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;POLYMER GROUP,&nbsp;INC.<BR>
<BR>
and<BR>
<BR>
WACHOVIA BANK, N.A.,<BR>
<BR>
as Warrant Agent<BR>
<BR>
SERIES B WARRANT AGREEMENT<BR>
<BR>
Dated as of March&nbsp;5, 2003 </FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="page_kt1872_1_1"> </A> </FONT> <FONT SIZE=2><B>TABLE OF CONTENTS  </B></FONT></P>

<!-- User-specified TAGGED TABLE -->
<TABLE WIDTH="81%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH WIDTH="4%" ALIGN="LEFT"><FONT SIZE=2>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TH>
<TH WIDTH="8%" ALIGN="LEFT"><FONT SIZE=2>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TH>
<TH WIDTH="79%" ALIGN="LEFT"><FONT SIZE=2>&nbsp;</FONT><BR></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="5%" ALIGN="CENTER"><FONT SIZE=1><B>Page</B></FONT><HR NOSHADE></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>1.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2>DEFINITIONS</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>1</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
2.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
EXECUTION AND DELIVERY OF WARRANT CERTIFICATES</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
3</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
3.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
EXERCISE OF WARRANT</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
4</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>3.1.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Exercise Period</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>4</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>3.2.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Exercise Procedure</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>4</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>3.3.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Exercise Agreement</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>5</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
4.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
TRANSFER, DIVISION AND COMBINATION</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
5</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>4.1.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Division, Combination and Exchange</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>5</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>4.2.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Expenses</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>6</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>4.3.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Maintenance of Books</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>6</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>4.4.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Transfer</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>6</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
5.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
ADJUSTMENTS</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
6</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
6.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
NOTICES OF AdJUSTMENT</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
6</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
7.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
RESERVATION AND AUTHORIZATION OF COMMON STOCK; REGISTRATION WITH OR APPROVAL OF ANY GOVERNMENTAL AUTHORITY</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
7</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
8.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
STOCK AND WARRANT TRANSFER BOOKS</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
7</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
9.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
SUPPLYING INFORMATION</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
7</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
10.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
LOSS OR MUTILATION</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
8</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
11.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
OFFICE OF COMPANY</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
8</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
12.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
LIMITATION OF LIABILITY</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
8</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
13.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
CONCERNING THE WARRANT AGENT</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
8</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>13.1.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Correctness of Statement</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>8</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>13.2.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Breach of Covenants</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>8</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>13.3.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Reliance on Counsel</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>8</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>13.4.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Reliance on Documents</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>8</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>13.5.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Compensation and Indemnification</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>9</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>13.6.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Legal Proceedings</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>9</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>13.7.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Other Transactions in Securities of the Company</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>9</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>13.8.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Liability of Warrant Agent</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>9</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>13.9.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Adjustments</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>9</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>13.10.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Resignation and Removal</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>9</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2><BR>
14.</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
MISCELLANEOUS</FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2><BR>
10</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>14.1.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Nonwaiver</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>10</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>14.2.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Notice Generally</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>10</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>14.3.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Appointment of Warrant Agent</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>10</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>14.4.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Successors and Assigns</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>10</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>14.5.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Amendment</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>10</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>14.6.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Severability</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>11</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>14.7.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Headings</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>11</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>14.8.</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="79%" VALIGN="BOTTOM"><FONT SIZE=2><I>Governing Law</I></FONT></TD>
<TD WIDTH="2%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT" VALIGN="BOTTOM"><FONT SIZE=2>11</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=5 VALIGN="TOP"><FONT SIZE=2><BR>
Exhibit&nbsp;A&nbsp;&nbsp;&nbsp;&nbsp;Form of Series&nbsp;B Warrant Certificate</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
13</FONT></TD>
</TR>
</TABLE>
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<P ALIGN="CENTER"><FONT SIZE=2>i</FONT></P>

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Exhibit&nbsp;B&nbsp;&nbsp;&nbsp;&nbsp;Subscription Form</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
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<TD COLSPAN=5 VALIGN="TOP"><FONT SIZE=2><BR>
Exhibit&nbsp;C&nbsp;&nbsp;&nbsp;&nbsp;Assignment Form</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
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<P ALIGN="CENTER"><FONT SIZE=2>ii</FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="page_kv1872_1_1"> </A> </FONT> <FONT SIZE=2><B><I>WARRANT AGREEMENT</I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WARRANT
AGREEMENT, dated as of March&nbsp;5, 2003 (the "Warrant Agreement"), between Polymer Group,&nbsp;Inc., a Delaware corporation (the "Company"), and Wachovia Bank, N.A., as
Warrant Agent (the "Warrant Agent"). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
pursuant to the Joint Second Amended Modified Plan of Reorganization (the "</FONT><FONT SIZE=2><I>Plan</I></FONT><FONT SIZE=2>") of the Company and certain of its subsidiaries,
as confirmed by the United States Bankruptcy Court for the District of South Carolina on January&nbsp;16, 2003, the Company proposes to issue Series&nbsp;B Warrants (as defined herein),
representing the right to purchase up to an aggregate of 523,557 shares of its Class&nbsp;E Common (as defined herein), subject to adjustment as hereinafter provided; and </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
the Company desires to appoint the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing so to act in connection with the issuance, transfer, exchange,
replacement and exercise of the Series&nbsp;B Warrant Certificates (as defined herein) and other matters as provided herein; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOW
THEREFORE, in consideration of the foregoing and for the purpose of defining the terms and conditions of the Series&nbsp;B Warrants and the respective rights and obligations
thereunder of the Company and the holders from time to time of the Series&nbsp;B Warrants, the Company and the Warrant Agent hereby agree as follows: </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. </FONT> <FONT SIZE=2><I>DEFINITIONS</I></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
used in this Warrant Agreement, the following terms have the respective meanings set forth below: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Business
Day" means any day that is not a Saturday or Sunday or a day on which banks are required or permitted to be closed in the State of New York. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Change
of Control" means (i)&nbsp;a merger, reorganization, restructuring, consolidation, share exchange, business combination, recapitalization, liquidation, dissolution or similar
transaction involving the Company in which the Company is not the surviving or resulting entity, as a result of which the Company's stockholders prior to such transactions, MatlinPatterson Global
Opportunities Partners L.P., any Affiliates of MatlinPatterson Global Opportunities Partners L.P. and any Group that includes as a member MatlinPatterson Global Opportunities Partners L.P. or any
Affiliates of MatlinPatterson Global Opportunities Partners L.P. cease to own at least 50% of the voting securities of the entity surviving or resulting from such transaction (or the ultimate parent
entity thereof), or (ii)&nbsp;the acquisition, directly or indirectly, by any Person (other than MatlinPatterson Global Opportunities Partners L.P. or its Affiliates or any Group that includes as a
member MatlinPatterson Global Opportunities Partners L.P. or any Affiliates of MatlinPatterson Global Opportunities Partners L.P.) of 50% or more of the Company's voting securities whether by merger,
consolidation, share exchange, business combination, tender or exchange offer, issuance or sale of securities or otherwise, other than in any such transaction following which the Company's
stockholders prior to such transaction, MatlinPatterson Global Opportunities Partners L.P., any Affiliates of MatlinPatterson Global Opportunities Partners L.P. and any Group that includes as a member
MatlinPatterson Global Opportunities Partners L.P. or any Affiliates of MatlinPatterson Global Opportunities Partners L.P., continue to own at least 50% of the voting securities of the entity
surviving or resulting from such transaction (or the ultimate parent entity thereof). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Class&nbsp;E
Common" means shares of the Company's Class&nbsp;E Common Stock, par value $.01 per share; provided that if there is a change such that the securities issuable upon
exercise of the Series&nbsp;B Warrants are issued by an entity other than the Company or there is a change in the type or class of securities so issuable, then the term "Class&nbsp;E Common" shall
mean one share of the security issuable upon exercise of the Series&nbsp;B Warrants if such security is issuable in shares, or </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>1</FONT></P>

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<P><FONT SIZE=2>
shall mean the smallest unit in which such security is issuable if such security is not issuable in shares. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Closing
Date" means March&nbsp;5, 2003. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Commission"
means the Securities and Exchange Commission or any other federal agency then administering the Securities Act and other federal securities laws. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Common
Stock" means, collectively, the Company's Class&nbsp;A Common Stock, par value $.01 per share, the Company's Class&nbsp;B Common Stock, par value $.01 per share, the
Company's Class&nbsp;C Common Stock, par value $.01 per share, the Company's Class&nbsp;D Common Stock, par value $.01 per share, and the Class&nbsp;E Common, and any capital stock of any class
of the Company hereafter authorized which is not limited to a fixed sum or percentage of par or stated value in respect to the rights of the holders thereof to participate in dividends or in the
distribution of assets upon any liquidation, dissolution or winding up of the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Current
Market Price" means, for the purpose of any computation of Current Market Price pursuant to this Warrant Agreement, the Current Market Price per share of Common Stock at any
date shall be the average of the daily closing sales prices for the shorter of (i)&nbsp;the 20 consecutive trading days ending on the last full trading day on the exchange or market specified in the
second succeeding sentence prior to the Time of Determination (as defined below) and (ii)&nbsp;the period commencing on the date next succeeding the first public announcement of the issuance, sale,
distribution or granting in question through such last full trading day prior to the Time of Determination; provided that in the case of a firm commitment underwritten public offering, the Current
Market Price shall mean the closing price of the Common Stock on the day of the pricing of such offering. The term "Time of Determination" as used herein shall be the time and date of the earlier to
occur of (A)&nbsp;the date as of which the Current Market Price is to be computed and (B)&nbsp;the last full trading day on such exchange or market before the commencement of
"ex-dividend" trading in the Common Stock relating to the event giving rise to the adjustment required by Section&nbsp;2.1, 2.2, 2.3, 2.4, 2.5 or 2.7 of the Series&nbsp;B Warrant
Certificates. The closing price for any day shall be the last reported sale price regular way or, in case no such reported sale takes place on such day, the average of the closing bid and asked prices
regular way for such day, in each case (1)&nbsp;on the principal national securities exchange on which the shares of Common Stock are listed or to which such shares are admitted to trading or
(2)&nbsp;if the Common Stock is not listed or admitted to trading on a national securities exchange, in the over-the-counter market as reported by the NASDAQ National Market
or any comparable system or (3)&nbsp;if the Common Stock is not listed on the NASDAQ National Market or a comparable system, the fair market value as determined in good faith by the Board of
Directors of the Company for that purpose. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Distribution
Notice" has the meaning set forth in Section&nbsp;3.1. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Exchange
Act" means the Securities Exchange Act of 1934, as amended, or any similar federal statute, and the rules and regulations of the Commission thereunder, as the same shall be in
effect from time to time. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Exercise
Period" has the meaning set forth in Section&nbsp;3.1. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Exercise
Price" means an amount equal to $.01 per share of Class&nbsp;E Common purchasable upon exercise of the Series&nbsp;B Warrants, as adjusted from time to time pursuant to
Section&nbsp;5 hereof and Section&nbsp;2 of the Series&nbsp;B Warrant Certificates. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Group"
means a "group" within the meaning of Section&nbsp;13(d)(3) of the Exchange Act. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Person"
means an individual, a partnership, a limited liability partnership, a joint venture, a corporation, a limited liability company, a trust, an unincorporated organization, any
other legal entity and a government or any department or agency thereof. </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>2</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Plan"
has the meaning assigned to such term in the recitals in this Warrant Agreement. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Registered
Holder" means, at any time, a Person in whose name a Series&nbsp;B Warrant is then registered on the books of the Company maintained by the Warrant Agent for such purpose. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Securities
Act" means the Securities Act of 1933, as amended, or any similar federal statute, and the rules and regulations of the Commission thereunder, all as the same shall be in
effect at the time. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Series&nbsp;A
Warrant" means each of the Company's warrants issued pursuant to the Series&nbsp;A Warrant Agreement, each of which evidences the right to purchase one share of the
Company's Class&nbsp;D Common, par value $.01 per share, subject to adjustment as set forth in the Series&nbsp;A Warrant Certificates, and all warrants issued upon transfer, division or
combination of, or in substitution for, any thereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Series&nbsp;A
Warrant Agreement" means the Series&nbsp;A Warrant Agreement, dated as of the date hereof, between the Company and the Warrant Agent. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Series&nbsp;A
Warrant Certificate" means a certificate, substantially in the form of Exhibit&nbsp;A to the Series&nbsp;A Warrant Agreement, representing one or more
Series&nbsp;A Warrants held by a holder thereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Series&nbsp;B
Warrant" means each of the Company's warrants issued pursuant to this Warrant Agreement, each of which evidences the right to purchase one share of Class&nbsp;E
Common, subject to adjustment as set forth in the Series&nbsp;B Warrant Certificates, and all warrants issued upon transfer, division or combination of, or in substitution for, any thereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Series&nbsp;B
Warrant Certificate" means a certificate, substantially in the form of Exhibit&nbsp;A hereto, representing one or more Series&nbsp;B Warrants held by a Holder. All
Series&nbsp;B Warrant Certificates shall be identical as to terms and conditions, except as to the number of Series&nbsp;B Warrants represented thereby. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Series&nbsp;B
Warrant Stock" means the shares of Class&nbsp;E Common purchased by the Holders of the Series&nbsp;B Warrants upon the exercise thereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Termination
Date" has the meaning set forth in Section&nbsp;3.1. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.
</FONT><FONT SIZE=2><I>EXECUTION AND DELIVERY OF WARRANT CERTIFICATES</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Series&nbsp;B
Warrant Certificates evidencing 523,557 Series&nbsp;B Warrants, each Series&nbsp;B Warrant to purchase initially one share of Class&nbsp;E Common, may be executed,
on or after the date of this Warrant Agreement, by the Company and delivered to the Warrant Agent for countersignature, and the Warrant Agent shall thereupon countersign and deliver such
Series&nbsp;B Warrant Certificates upon the order and at the written direction of the Company signed by its Chief Executive Officer, President, Chief Financial Officer, any Vice President or other
duly authorized executive officer. The Warrant Agent is hereby authorized to countersign and deliver Series&nbsp;B Warrant Certificates as required by this Section&nbsp;2 or by Section&nbsp;3.2,
4 or 11 hereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Series&nbsp;B Warrant Certificates shall be executed on behalf of the Company by its Chairman of the Board, Chief Executive Officer, President, Chief Financial Officer, any Vice
President or other duly authorized executive officer of the Company either manually or by facsimile signature printed thereon. The Series&nbsp;B Warrant Certificates shall be countersigned by manual
signature of the Warrant Agent and shall not be valid for any purpose unless so countersigned. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
case any officer or director of the Company whose signature shall have been placed upon any Series&nbsp;B Warrant Certificate shall cease to be such officer or director of the
Company before </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>3</FONT></P>

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<P><FONT SIZE=2>
countersignature by the Warrant Agent and the issuance and delivery thereof, such Series&nbsp;B Warrant Certificate may nevertheless be countersigned by the Warrant Agent and issued and delivered
with the same force and effect as though such person had not ceased to be such officer or director of the Company. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.
</FONT><FONT SIZE=2><I>EXERCISE OF WARRANT</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1. </FONT> <FONT SIZE=2><I>Exercise Period</I></FONT><FONT SIZE=2>. A Registered Holder may exercise, in whole or in part, the purchase rights represented by Series&nbsp;B Warrants
at any time and from time to time after the delivery by the Company of a Distribution Notice to the Registered Holders up to and including the Termination Date (the "Exercise Period"). The purchase
rights represented by the Series&nbsp;B Warrants shall not be exercisable until the Company delivers a Distribution Notice. The Company shall give the Registered Holders written notice thirty
(30)&nbsp;calendar days prior to any Distribution (as defined in the Company's Amended and Restated Certificate of Incorporation) or consummation of a Change in Control in which an outstanding share
of Class&nbsp;E Common would be entitled to participate pursuant to the terms of the Company's Amended and Restated Certificate of Incorporation (a "Distribution Notice"). The Series&nbsp;B
Warrants, the purchase rights represented thereby, all of the Company's obligations thereunder and any other rights of the Registered Holders thereunder shall terminate upon the earlier to occur of
(i)&nbsp;the
close of business on March&nbsp;4, 2010, and (ii)&nbsp;the business day immediately preceding the consummation of a Change of Control (collectively, the "Termination Date"). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2.
</FONT><FONT SIZE=2><I>Exercise Procedure</I></FONT><FONT SIZE=2>. </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;The
Series&nbsp;B Warrants shall be deemed to have been exercised when the Company has received all of the following items (the "Exercise Time"): </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;a
completed Exercise Agreement, as described in Section&nbsp;3.3 below, executed by the Person exercising all or part of the purchase rights represented by the
Series&nbsp;B Warrant being exercised (the "Purchaser"); </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;the
Series&nbsp;B Warrant Certificate in respect of the Series&nbsp;B Warrant being exercised; </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;if
the Series&nbsp;B Warrant being exercised is not registered in the name of the Purchaser, an Assignment or Assignments in the form attached to the Series&nbsp;B
Warrant Certificate evidencing the assignment of the Series&nbsp;B Warrant being exercised to the Purchaser, in which case the Registered Holder shall have complied with the provisions set forth in
Section&nbsp;4 hereof; and </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;either
(1)&nbsp;a check payable to the Company in an amount equal to the product of the Exercise Price multiplied by the number of shares of Class&nbsp;E Common
being purchased upon such exercise (the "Aggregate Exercise Price"), or (2)&nbsp;a written notice to the Company that the Purchaser is exercising the Series&nbsp;B Warrant (or a portion thereof)
by authorizing the Company to withhold from issuance a number of shares of Class&nbsp;E Common issuable upon such exercise of such Series&nbsp;B Warrant which when multiplied by the Current Market
Price of the Common Stock is equal to the Aggregate Exercise Price (and such withheld shares shall no longer be issuable under such Series&nbsp;B Warrant). </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;Upon
delivery of the foregoing, certificates for shares of Class&nbsp;E Common purchased upon exercise of a Series&nbsp;B Warrant shall be delivered by the Company,
or, if so requested by the Company in writing, by the Warrant Agent, to the Purchaser within three business days after the date of the Exercise Time. Unless the Series&nbsp;B Warrants represented by
a surrendered Series&nbsp;B Warrant Certificate have expired or all of the purchase rights represented thereby have been exercised, the Company, or if so requested in writing by the Company, the
Warrant Agent, shall prepare a new Series&nbsp;B Warrant Certificate, substantially </FONT></P>

</UL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>4</FONT></P>

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<UL>
<UL>

<P><FONT SIZE=2>
identical thereto, representing the rights formerly represented by such Series&nbsp;B Warrant Certificate which have not expired or been exercised and shall, within such three-day
period, deliver such new Series&nbsp;B Warrant Certificate to the Person designated for delivery in the Exercise Agreement; </FONT><FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT> <FONT SIZE=2><I>however</I></FONT><FONT SIZE=2>, that if
(A)&nbsp;the Series&nbsp;B Warrants represented by such Series&nbsp;B Warrant Certificate are not
exercised in the name of the Purchaser and (B)&nbsp;the Assignment or Assignments delivered to the Company therewith are for less than all of the rights formerly represented by such Series&nbsp;B
Warrant Certificate, then a new Series&nbsp;B Warrant Certificate, substantially identical thereto, representing the rights formerly represented by such Series&nbsp;B Warrant Certificate which
have not expired or been exercised and which were not assigned pursuant to the Assignment or Assignments delivered to the Company shall, within such three-day period, be delivered by the
Company, or the Warrant Agent, as applicable, to the Registered Holder and a new Series&nbsp;B Warrant Certificate, substantially identical thereto, representing the rights formerly represented by
such Series&nbsp;B Warrant Certificate which have not expired or been exercised and which were assigned pursuant to the Assignment or Assignment delivered to the Company shall, within such
three-day period, be delivered by the Company, or the Warrant Agent, as applicable, to the Person designated for delivery in the Exercise Agreement. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;Notwithstanding
anything to the contrary herein, the exercise of a Series&nbsp;B Warrant upon the delivery of a Distribution Notice shall not be deemed effective, the
Class&nbsp;E Common issuable upon the exercise of such Series&nbsp;B Warrant shall not be deemed to have been issued to the Purchaser, and the Purchaser shall not be deemed to have become the
record holder of such Class&nbsp;E Common until immediately prior to the occurrence of the Distribution that was the subject of such Distribution Notice; </FONT> <FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT><FONT
SIZE=2><I>however</I></FONT><FONT SIZE=2>, that if the Distribution that was the subject of such Distribution Notice will result
from a Change of Control, the exercise of such Series&nbsp;B Warrant shall be deemed effective, the Class&nbsp;E Common issuable upon the exercise of such Series&nbsp;B Warrant shall be deemed
to have been issued to the Purchaser, and the Purchaser shall be deemed to have become the record holder of such Class&nbsp;E Common immediately prior to the consummation of such Change in Control. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;The
issuance of certificates for shares of Class&nbsp;E Common upon exercise of the Series&nbsp;B Warrants shall be made without charge to the Registered Holders or
any Purchaser for any issuance tax in respect thereof or other cost incurred by the Company or the Warrant Agent in connection with such exercise and the related issuance of shares of Class&nbsp;E
Common. Each share of Class&nbsp;E Common issuable upon exercise of the Series&nbsp;B Warrants shall, upon payment of the Exercise Price therefor, be fully paid and nonassessable and free from all
liens and charges with respect to the issuance thereof. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3.
</FONT><FONT SIZE=2><I>Exercise Agreement</I></FONT><FONT SIZE=2>. Upon any exercise of a Series&nbsp;B Warrant, the Exercise Agreement shall be substantially in the form set
forth in </FONT><FONT SIZE=2><I>Exhibit&nbsp;I </I></FONT><FONT SIZE=2>to the Series&nbsp;B Warrant Certificates, except that if the shares of Class&nbsp;E Common are not to be issued in the
name of the Person in whose name a Series&nbsp;B Warrant is registered, the Exercise Agreement shall also state the name of the Person to whom the certificates for the shares of Class&nbsp;E
Common are to be issued, and if the number of shares of Class&nbsp;E Common to be issued does not include all the shares of Class&nbsp;E Common purchasable thereunder, it shall also state the name
of the Person to whom a new Series&nbsp;B Warrant Certificate for the unexercised portion of the rights thereunder is to be delivered. Such Exercise Agreement shall be dated the actual date of
execution thereof. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.
</FONT><FONT SIZE=2><I>TRANSFER, DIVISION AND COMBINATION</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.
</FONT><FONT SIZE=2><I>Division, Combination and Exchange</I></FONT><FONT SIZE=2>. A Series&nbsp;B Warrant Certificate is exchangeable, upon the surrender thereof by the
Registered Holder at the office or agency of the Warrant Agent, together with a written notice specifying the names and denominations in which new Series&nbsp;B </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>5</FONT></P>

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<UL>

<P><FONT SIZE=2>
Warrant Certificates are to be issued, signed by the Registered Holder of such Series&nbsp;B Warrant Certificate or Certificates or its agent or attorney, for new Series&nbsp;B Warrant
Certificates of like tenor representing in the aggregate the purchase rights thereunder. Subject to compliance with this Section&nbsp;4.1, as to any transfer which may be involved in such exchange,
the Warrant Agent shall execute and deliver a new Series&nbsp;B Warrant Certificate(s) in exchange for the Series&nbsp;B Warrant Certificate(s) representing the Series&nbsp;B Warrants to be
exchanged in accordance with such notice, and each of such new Series&nbsp;B Warrant Certificates shall represent such portion of such rights as is designated in writing by the Registered Holder at
the time of such surrender. The date the Company initially issues a Series&nbsp;B Warrant shall be deemed to be the "Date of Issuance" thereof regardless of the number of times new certificates
representing the unexpired and unexercised rights formerly represented by a Series&nbsp;B Warrant Certificate shall be issued. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2.
</FONT><FONT SIZE=2><I>Expenses</I></FONT><FONT SIZE=2>. The preparation, issuance and delivery of the new Series&nbsp;B Warrant Certificates under this Section&nbsp;4 shall be
at the Company's expense (other than transfer taxes). The Company shall not be required, however, to pay any tax or other charge imposed in connection with any transfer of any Series&nbsp;B
Warrants, including, but not limited to, any transfer involved in the exchange of any Series&nbsp;B Warrant Certificates under this Section&nbsp;4, and in such case the Company shall not be
required to issue or deliver any Series&nbsp;B Warrant Certificates until such tax or other charge has been paid or it has been established to the satisfaction of the Company that no such tax or
other charge is due. If such tax or other charge is due, the Warrant Agent shall have no duty or obligation under this Section&nbsp;4 or any other similar provision of this Warrant Agreement unless
and until it is satisfied that all such taxes and/or governmental charges have been paid in full. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3. </FONT> <FONT SIZE=2><I>Maintenance of Books</I></FONT><FONT SIZE=2>. The Company agrees to maintain, at the office or agency of the Warrant Agent as provided in Section&nbsp;11,
books for the registration and the registration of transfer of the Series&nbsp;B Warrants. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4.
</FONT><FONT SIZE=2><I>Transfer</I></FONT><FONT SIZE=2>. The Series&nbsp;B Warrants and all rights thereunder are transferable, in whole or in part, without charge to the
Registered Holders, upon surrender of a Series&nbsp;B Warrant Certificate with a properly executed Assignment (in the form of </FONT><FONT SIZE=2><I>Exhibit&nbsp;II  </I></FONT><FONT SIZE=2>attached to the Series&nbsp;B Warrant Certificates) at the
office or agency of the Warrant Agent as provided Section&nbsp;11. Upon any partial transfer, the Warrant Agent
shall promptly issue and deliver to the Registered Holder thereof a new Series&nbsp;B Warrant Certificate of like tenor, in the name of the Registered Holder thereof, which shall be exercisable for
such number of shares of Series&nbsp;B Warrant Stock which were not so transferred in accordance with Section&nbsp;4.1. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.
</FONT><FONT SIZE=2><I>ADJUSTMENTS</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
order to prevent dilution of the rights granted under the Series&nbsp;B Warrants under certain circumstances, the number of shares of Class&nbsp;E Common for which each
Series&nbsp;B Warrant is exercisable, shall be subject to adjustment from time to time as set forth in the Series&nbsp;B Warrant Certificates. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. </FONT> <FONT SIZE=2><I>NOTICES OF AdJUSTMENT</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
soon as reasonably practicable after any adjustment of the Exercise Price or the number of shares of Class&nbsp;E Common for which the Series&nbsp;B Warrants are exercisable, and
in no event later than the date of the first Distribution Notice delivered thereafter, the Company shall give written notice thereof to the Registered Holders, setting forth in reasonable detail and
certifying the calculation of such adjustment. </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>6</FONT></P>

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<UL>

<P><FONT SIZE=2><I>7. RESERVATION AND AUTHORIZATION OF COMMON STOCK; REGISTRATION WITH OR APPROVAL OF ANY GOVERNMENTAL AUTHORITY</I></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;From
and after the Closing Date, the Company shall at all times reserve and keep available for issue upon the exercise of Series&nbsp;B Warrants such number of authorized but unissued
shares of Class&nbsp;E Common as will be sufficient to permit the exercise in full of all outstanding Series&nbsp;B Warrants; </FONT><FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT> <FONT SIZE=2><I>however</I></FONT><FONT SIZE=2>, that if
(A)&nbsp;the number of shares of Class&nbsp;E Common issuable upon exercise of all outstanding Series&nbsp;B Warrants shall
increase after the date hereof as the result of any adjustment required pursuant to Section&nbsp;2 of the Series&nbsp;B Warrant Certificates (the increased number of shares issuable thereunder
being referred to herein as "Adjustment Shares") and (B)&nbsp;the Company, at the time of such adjustment (or the transaction or other occurrence triggering such adjustment) does not have sufficient
authorized capital stock to reserve and keep available such additional number of shares of Class&nbsp;E Common as equals the number of Adjustment Shares, then the Company shall be permitted not to
reserve and keep available such additional number of shares of Class&nbsp;E Common as equals the number of Adjustment Shares until the earlier to occur of the date immediately preceding the date of
any Distribution Notice and the date that is forty-five (45)&nbsp;days after the Company's next annual meeting of shareholders. The Company shall not take any action that would cause it
to violate the requirements of the immediately preceding sentence. All shares of Class&nbsp;E Common which shall be so issuable, when issued upon exercise of any Series&nbsp;B Warrant and payment
therefor in accordance with the terms thereof and of this Warrant Agreement, shall be duly and validly issued and fully paid and nonassessable, not subject to preemptive rights, and free from all
taxes, liens, charges, security interests, encumbrances and other restrictions created by or through the Company. The Company shall from time to time take all such action as may be necessary to assure
that the par value per share of the unissued Class&nbsp;E Common acquirable upon exercise of the Series&nbsp;B Warrants is at all times equal to or less than the Exercise Price then in effect. The
Company shall take all such actions as may be necessary to assure that all such shares of Class&nbsp;E Common may be so issued without violation of any applicable law or governmental regulation or
any requirements of any domestic securities exchange upon which shares of Common Stock may be listed (except for official notice of issuance which shall be immediately delivered by the Company upon
each such issuance). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
any shares of Class&nbsp;E Common required to be reserved for issuance upon exercise of Series&nbsp;B Warrants require registration or qualification with any governmental
authority or other governmental approval or filing under any federal law before such shares may be so issued, the Company will in good faith (subject to all applicable laws including, without
limitation, those rules and regulations promulgated under the Securities Act) and as expeditiously as possible and at its expense endeavor to cause such shares to be duly registered. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. </FONT> <FONT SIZE=2><I>STOCK AND WARRANT TRANSFER BOOKS</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prior
to the delivery of a Distribution Notice, the Company shall not close its books against the transfer of the Series&nbsp;B Warrants or of any share of Class&nbsp;E Common issued
or issuable upon the exercise of the Series&nbsp;B Warrants in any manner which interferes with the timely exercise of the Series&nbsp;B Warrants. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.
</FONT><FONT SIZE=2><I>SUPPLYING INFORMATION</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company shall reasonably cooperate with each Registered Holder of a Series&nbsp;B Warrant and each holder of Series&nbsp;B Warrant Stock in supplying such information as may be
reasonably necessary for such holder to complete and file any information reporting forms presently or hereafter required by the Commission as a condition to the availability of an exemption from the
Securities Act for the sale of any Series&nbsp;B Warrant or Series&nbsp;B Warrant Stock. </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>7</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. </FONT> <FONT SIZE=2><I>LOSS OR MUTILATION</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon
receipt of evidence reasonably satisfactory to the Company (an affidavit of the Registered Holder shall be satisfactory) of the ownership and the loss, theft, destruction or
mutilation of any certificate evidencing a Series&nbsp;B Warrant Certificate, and in the case of any such loss, theft or destruction, upon receipt of indemnity reasonably satisfactory to the Company
(provided that if the holder is a financial institution or other institutional investor its own agreement shall be satisfactory), or, in the case of any such mutilation upon surrender of such
certificate, the Company shall (at its expense) execute and deliver in lieu of such certificate a new certificate of like kind representing the same rights represented by such lost, stolen, destroyed
or mutilated certificate and dated the date of such lost, stolen, destroyed or mutilated certificate. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.
</FONT><FONT SIZE=2><I>OFFICE OF COMPANY</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
long as any of the Series&nbsp;B Warrants remain outstanding, the Warrant Agent, on behalf of the Company, shall maintain an office or agency (which shall be the principal executive
offices of the Warrant Agent) where the Series&nbsp;B Warrants may be presented for exercise, registration of transfer or exchange as provided in this Warrant Agreement. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.
</FONT><FONT SIZE=2><I>LIMITATION OF LIABILITY</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No
provision hereof, in the absence of affirmative action by a Registered Holder to purchase shares of Class&nbsp;E Common, and no enumeration herein of the rights or privileges of a
Registered Holder hereof, shall give rise to any liability of such Registered Holder for the purchase price of any Class&nbsp;E Common or as a stockholder of the Company, whether such liability is
asserted by the Company or by creditors of the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Series&nbsp;B Warrants shall not entitle the Registered Holders to any voting rights or other rights as a stockholder of the Company. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.
</FONT><FONT SIZE=2><I>CONCERNING THE WARRANT AGENT</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Warrant Agent undertakes the duties and obligations imposed by this Warrant Agreement upon the following terms and conditions, by all of which the Company and the Registered Holders,
by their acceptance of the Series&nbsp;B Warrants, shall be bound: </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.1. </FONT> <FONT SIZE=2><I>Correctness of Statement</I></FONT><FONT SIZE=2>. The statements contained herein and in the Series&nbsp;B Warrant Certificates shall be taken as
statements of the Company, and the Warrant Agent assumes no responsibility for the correctness of any of the same except such as describe the Warrant Agent or action to be taken by it. The Warrant
Agent assumes no responsibility with respect to the distribution of the Series&nbsp;B Warrant Certificates except as herein otherwise provided. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.2.
</FONT><FONT SIZE=2><I>Breach of Covenants</I></FONT><FONT SIZE=2>. The Warrant Agent shall not be responsible for any failure of the Company to comply with any of the covenants
contained in this Warrant Agreement or in the Series&nbsp;B Warrant Certificates to be complied with by the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.3.
</FONT><FONT SIZE=2><I>Reliance on Counsel</I></FONT><FONT SIZE=2>. The Warrant Agent may consult at any time with counsel satisfactory to it (who may be counsel for the Company)
and the Warrant Agent shall incur no liability or responsibility
to the Company or to any Registered Holder in respect of any action taken, suffered or omitted by it hereunder in good faith and in accordance with the opinion or the advice of such counsel. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.4. </FONT> <FONT SIZE=2><I>Reliance on Documents</I></FONT><FONT SIZE=2>. The Warrant Agent shall incur no liability or responsibility to the Company or to any Registered Holder for
any action taken, suffered or omitted in reliance on any Series&nbsp;B Warrant Certificate, certificate of shares, notice, resolution, waiver, consent, order certificate, or other paper, document or
instrument believed by it to be genuine and to have signed, sent or presented by the proper party or parties. </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>8</FONT></P>

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<UL>
<BR>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.5. </FONT> <FONT SIZE=2><I>Compensation and Indemnification</I></FONT><FONT SIZE=2>. The Company agrees to pay to the Warrant Agent reasonable compensation for all services rendered
by the Warrant Agent in the execution of this Warrant Agreement, to reimburse the Warrant Agent for all expenses, taxes and governmental charges and other charges of any kind and nature incurred by
the Warrant Agent in the execution of this Warrant Agreement and, to indemnify the Warrant Agent and save it harmless against any and all liabilities, including judgments, costs and counsel fees, for
anything done or omitted by the Warrant Agent in the execution of its duties and powers under this Warrant Agreement, except for such liabilities that arise as a result of the Warrant Agent's
negligence, willful misconduct or bad faith. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.6. </FONT> <FONT SIZE=2><I>Legal Proceedings</I></FONT><FONT SIZE=2>. The Warrant Agent shall be under no obligation to institute any action, suit or legal proceeding or to take any
other action likely to involve expense unless the Company or one or more Registered Holders shall furnish the Warrant Agent with reasonable security and indemnity for any costs and expenses which may
be incurred, but this provision shall not affect the power of the Warrant Agent to take such action as it may consider proper, whether with or without any such security indemnity. All rights of action
under this Warrant Agreement or under any of the Series&nbsp;B Warrant Certificates may be enforced by the Warrant Agent without possession of any of the Series&nbsp;B Warrant Certificates or the
production thereof at any trial or other proceeding relative thereto, and any such action, suit or proceeding instituted by the Warrant Agent shall be brought in its name as Warrant Agent, and any
recovery of judgment shall be for the ratable benefit of the Holders, as their respective rights or interests may appear. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.7.
</FONT><FONT SIZE=2><I>Other Transactions in Securities of the Company</I></FONT><FONT SIZE=2>. Except as prohibited by law, the Warrant Agent, and any stockholder, director,
officer or employee of it, may buy, sell or deal in any of the Series&nbsp;B Warrants or other securities of the Company or become pecuniarily interested in any transaction in which the Company may
be interested, or contract with or lend money to the Company or otherwise act as fully and freely as though it were not Warrant Agent under this Warrant Agreement. Nothing herein shall preclude the
Warrant Agent from acting in any other capacity for the Company or for any other legal entity. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.8.
</FONT><FONT SIZE=2><I>Liability of Warrant Agent</I></FONT><FONT SIZE=2>. The Warrant Agent shall act hereunder solely as agent for the Company, and its duties shall be
determined solely by the provisions hereof. The Warrant Agent shall
not be liable for anything which it may do or refrain from doing in connection with this Warrant Agreement except for its own negligence, willful misconduct or bad faith. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.9. </FONT> <FONT SIZE=2><I>Adjustments</I></FONT><FONT SIZE=2>. The Warrant Agent shall not at any time be under any duty or responsibility to any Holder to make or cause to be made
any adjustment of the Exercise Price or number of shares of Series&nbsp;B Warrant Stock deliverable as provided in this Warrant Agreement, or to determine whether any facts exist which may require
any of such adjustments, or with respect to the nature or extent of any such adjustments, when made, or with respect to the method employed in making the same. The Warrant Agent shall not be
accountable with respect to the validity or value or the kind or amount of any shares of Series&nbsp;B Warrant Stock or of any securities or property which may at any time be issued or delivered
upon the exercise of any Series&nbsp;B Warrant or with respect to whether any such shares of Series&nbsp;B Warrant Stock or other securities will be, when issued, validly issued, fully paid and
nonassessable, and makes no representation with respect thereto. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.10.
</FONT><FONT SIZE=2><I>Resignation and Removal</I></FONT><FONT SIZE=2>. The Warrant Agent may resign at any time by so notifying the Company in writing. The Company may remove
the Warrant Agent by so notifying the Warrant Agent in writing and may appoint a successor Warrant Agent. If the Warrant Agent resigns or is removed or if a vacancy exists in the office of Warrant
Agent for any reason (the Warrant Agent in such event being referred to herein as the retiring Warrant Agent), the Company shall promptly appoint a successor Warrant Agent. A successor Warrant Agent
shall deliver a written acceptance </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>9</FONT></P>

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<P><FONT SIZE=2>
of its appointment to the retiring Warrant Agent and to the Company. As promptly as practicable after that, the retiring Warrant Agent shall transfer, after payment of all sums then owing to the
Warrant Agent, all property held by it as Warrant Agent to the successor Warrant Agent, the resignation or removal of the retiring Warrant Agent shall become effective, and the successor Warrant Agent
shall have the rights, powers and duties of the Warrant Agent under this Agreement. A successor Warrant Agent shall mail notice of its succession to each Registered Holder. If a successor Warrant
Agent does not take office within 60&nbsp;days after the retiring Warrant Agent resigns or is removed, the retiring Warrant Agent or the Company may petition, at the expense of the Company, any
court of competent jurisdiction for the appointment of a successor Warrant Agent. Notwithstanding replacement of the Warrant Agent pursuant to this Section&nbsp;13.10, the Company's obligations
under Section&nbsp;13.5 shall continue for the benefit of the retiring Warrant Agent. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.
</FONT><FONT SIZE=2><I>MISCELLANEOUS</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.1. </FONT> <FONT SIZE=2><I>Nonwaiver</I></FONT><FONT SIZE=2>. No course of dealing or any delay or failure to exercise any right hereunder on the part of any Holder shall operate as a
waiver of such right or otherwise prejudice Holder's rights, powers or remedies. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2.
</FONT><FONT SIZE=2><I>Notice Generally</I></FONT><FONT SIZE=2>. Except as otherwise expressly provided herein, all notices referred to in this Agreement shall be in writing and
shall be delivered personally, sent by reputable overnight courier service (charges prepaid) or sent by registered or certified mail, return receipt requested, postage
prepaid and shall be deemed to have been given when so delivered, sent or deposited in the U.S. Mail, addressed as follows: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;If
to any Registered Holder or holder of Series&nbsp;B Warrant Stock, at such Registered Holder's address as it appears in the records of the Company maintained by the
Warrant Agent for such purpose; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;If
to the Warrant Agent, to Wachovia Bank, N.A., as Warrant Agent, Corporate Trust Group, Corporate Actions Department, 1525 West W.T. Harris Blvd., Bldg. 3C3,
Charlotte, NC 28262-1153 (overnight courier) 28288-1153 (first class mail); </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;If
to the Company, at its principal executive offices; </FONT></P>

</UL>

<P><FONT SIZE=2>or
at such other address as may be substituted by notice given as herein provided. The giving of any notice required hereunder may be waived in writing by the party entitled to receive such notice. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.3.
</FONT><FONT SIZE=2><I>Appointment of Warrant Agent</I></FONT><FONT SIZE=2>. The Company hereby appoints the Warrant Agent to act as agent for the Company in accordance with the
instructions set forth herein, and the Warrant Agent hereby accepts such appointment. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.4. </FONT> <FONT SIZE=2><I>Successors and Assigns</I></FONT><FONT SIZE=2>. This Warrant Agreement and the rights evidenced hereby shall inure to the benefit of and be binding upon the
successors of the Company, the Warrant Agent and the successors and assigns of each Registered Holder. The provisions of this Warrant Agreement are intended to be for the benefit of all Registered
Holders from time to time of a Series&nbsp;B Warrant or Series&nbsp;B Warrants and holders of Series&nbsp;B Warrant Stock, and shall be enforceable by any such Registered Holder or holder of
Series&nbsp;B Warrant Stock. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.5.
</FONT><FONT SIZE=2><I>Amendment</I></FONT><FONT SIZE=2>. The Company and the Warrant Agent may from time to time supplement or amend this Warrant Agreement without the approval
of any Registered Holders in order to cure any ambiguity or to correct or supplement any provision contained herein which may be defective or inconsistent with any other provision herein, or to make
any other provisions or change in regard to matters or questions arising hereunder which the Company and the Warrant Agent may </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>10</FONT></P>

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<P><FONT SIZE=2>
deem necessary or desirable and which shall not adversely affect the interests of any Registered Holder. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.6.
</FONT><FONT SIZE=2><I>Severability</I></FONT><FONT SIZE=2>. Wherever possible, each provision of this Warrant Agreement shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Warrant Agreement shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition
or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Warrant Agreement. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.7.
</FONT><FONT SIZE=2><I>Headings</I></FONT><FONT SIZE=2>. The headings used in this Warrant Agreement are for the convenience of reference only and shall not, for any purpose, be
deemed a part of this Warrant Agreement. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.8.
</FONT><FONT SIZE=2><I>Governing Law</I></FONT><FONT SIZE=2>. This Warrant Agreement shall be governed by the laws of the State of New York, without regard to the provisions
thereof relating to conflict of laws; provided however, that the corporation laws of the State of Delaware shall govern all issues concerning the relative rights of the Company and its stockholders. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>*
* * * * </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>11</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN
WITNESS WHEREOF, the Company and the Warrant Agent have caused this Warrant Agreement to be duly executed as of the date first written above. </FONT></P>
</UL>
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<TD WIDTH="38%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=5><FONT SIZE=2>POLYMER GROUP,&nbsp;INC.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="43%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=3><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Name:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="43%"><FONT SIZE=2>James G. Boyd</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Title:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="43%"><FONT SIZE=2>Executive Vice President, Treasurer Chief Financial Officer and Director</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=5><FONT SIZE=2><BR>
WACHOVIA BANK, N.A.</FONT></TD>
</TR>
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<TD WIDTH="38%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="43%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=3><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Name:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="43%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Title:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="43%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
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<P ALIGN="CENTER"><FONT SIZE=2>12</FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2>
EXHIBIT A<BR>
<BR>
FORM OF SERIES B WARRANT CERTIFICATE<BR>
<BR>
SERIES B WARRANT<BR>
<BR>
POLYMER GROUP,&nbsp;INC. </FONT></P>

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<TD WIDTH="20%"><FONT SIZE=2>Date of Issuance:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="29%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="18%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="20%" ALIGN="RIGHT"><FONT SIZE=2>Certificate No. W-</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="20%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="29%"><HR NOSHADE></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="18%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="20%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FOR
VALUE RECEIVED, Polymer Group,&nbsp;Inc., a Delaware corporation (the "Company"), hereby grants to&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;or its
registered assigns (the "Registered Holder") the right to
purchase from the Company&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares of the Company's Class&nbsp;E Common at a price per share of $.01 (the "Exercise Price"). This Warrant is one of several warrants to purchase
Class&nbsp;E Common (collectively, the "Warrants") issued in connection with the Company's Second Amended Modified Joint Plan of Reorganization, dated as of January&nbsp;16, 2003 (the "Plan") and
pursuant to the terms of a Warrant Agreement, dated as of March&nbsp;5, 2003, between the Company and Wachovia Bank, N.A. Certain capitalized terms used herein are defined in Section&nbsp;3
hereof. The amount and kind of securities obtainable pursuant to the rights granted hereunder are subject to adjustment pursuant to the provisions contained in this Warrant. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
Warrant is subject to the following provisions: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.
</FONT><FONT SIZE=2><I>EXERCISE OF WARRANT</I></FONT><FONT SIZE=2>. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1.
</FONT><FONT SIZE=2><I>Exercise Period</I></FONT><FONT SIZE=2>. The Registered Holder may exercise, in whole or in part, the purchase rights represented by this Warrant at any time
and from time to time after the delivery by the Company of a Distribution Notice (as defined below) to the Registered Holder up to and including the Termination Date (as defined below) (the "Exercise
Period"). The purchase rights represented by this Warrant shall not be exercisable until the Company delivers a Distribution Notice. The Company shall give the Registered Holder written notice thirty
(30)&nbsp;calendar days prior to any Distribution (as defined in the Company's Amended and Restated Certificate of Incorporation) or consummation of a Change in
Control in which an outstanding share of Class&nbsp;E Common would be entitled to participate pursuant to the terms of the Company's Amended and Restated Certificate of Incorporation (a
"Distribution Notice"). This Warrant, the purchase rights represented hereby, all of the Company's obligations hereunder and any other rights of the Registered Holder hereunder shall terminate upon
the earlier to occur of (i)&nbsp;the close of business on March&nbsp;4, 2010, and (ii)&nbsp;the business day immediately preceding the consummation of a Change of Control (collectively, the
"Termination Date"). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2.
</FONT><FONT SIZE=2><I>Exercise Procedure</I></FONT><FONT SIZE=2>. </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.&nbsp;&nbsp;&nbsp;&nbsp;This
Warrant shall be deemed to have been exercised when the Company has received all of the following items (the "Exercise Time"): </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;a
completed Exercise Agreement, as described in Section&nbsp;1.3 below, executed by the Person exercising all or part of the purchase rights represented by this
Warrant (the "Purchaser"); </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;this
Warrant; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;if
this Warrant is not registered in the name of the Purchaser, an Assignment or Assignments in the form set forth in </FONT><FONT SIZE=2><I>Exhibit&nbsp;II  </I></FONT><FONT SIZE=2>hereto evidencing the assignment of this Warrant to the Purchaser, in
which case the Registered Holder shall have complied with the provisions set forth in Section&nbsp;5
hereof; and </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;either
(1)&nbsp;a check payable to the Company in an amount equal to the product of the Exercise Price multiplied by the number of shares of Class&nbsp;E Common
being </FONT></P>

</UL>
</UL>
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<P><FONT SIZE=2>
purchased upon such exercise (the "Aggregate Exercise Price"), or (2)&nbsp;a written notice to the Company that the Purchaser is exercising the Warrant (or a portion thereof) by authorizing the
Company to withhold from issuance a number of shares of Class&nbsp;E Common issuable upon such exercise of the Warrant which when multiplied by the Current Market Price of the Common Stock is equal
to the Aggregate Exercise Price (and such withheld shares shall no longer be issuable under this Warrant). </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;Certificates
for shares of Class&nbsp;E Common purchased upon exercise of this Warrant shall be delivered by the Company or the Warrant Agent to the Purchaser within
three business days after the
date of the Exercise Time. Unless this Warrant has expired or all of the purchase rights represented hereby have been exercised, the Company or the Warrant Agent shall prepare a new Warrant,
substantially identical hereto, representing the rights formerly represented by this Warrant which have not expired or been exercised and shall, within such three-day period, deliver such
new Warrant to the Person designated for delivery in the Exercise Agreement; </FONT><FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT><FONT SIZE=2><I>however</I></FONT><FONT SIZE=2>, that if
(A)&nbsp;this Warrant is not exercised in the name of the Purchaser and (B)&nbsp;the Assignment or Assignments delivered to the Company herewith are for less than all of the rights formerly
represented by this Warrant, then a new Warrant, substantially identical hereto, representing the rights formerly represented by this Warrant which have not expired or been exercised and which were
not assigned pursuant to the Assignment or Assignments delivered to the Company shall, within such three-day period, be delivered by the Company or the Warrant Agent to the Registered
Holder and a new Warrant, substantially identical hereto, representing the rights formerly represented by this Warrant which have not expired or been exercised and which were assigned pursuant to the
Assignment or Assignment delivered to the Company shall, within such three-day period, be delivered by the Company or the Warrant Agent to the Person designated for delivery in the
Exercise Agreement. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;Notwithstanding
anything to the contrary herein, the exercise of this Warrant upon the delivery of a Distribution Notice shall not be deemed effective, the
Class&nbsp;E Common issuable upon the exercise of this Warrant shall not be deemed to have been issued to the Purchaser, and the Purchaser shall not be deemed to have become the record holder of
such Class&nbsp;E Common until immediately prior to the occurrence of the Distribution that was the subject of such Distribution Notice; </FONT><FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT> <FONT SIZE=2><I>however</I></FONT><FONT SIZE=2>,
that if the Distribution that was the subject of such Distribution Notice will result from a Change of Control, the exercise of this Warrant
shall be deemed effective, the Class&nbsp;E Common issuable upon the exercise of this Warrant shall be deemed to have been issued to the Purchaser, and the Purchaser shall be deemed to have become
the record holder of such Class&nbsp;E Common immediately prior to the consummation of such Change in Control. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;The
issuance of certificates for shares of Class&nbsp;E Common upon exercise of this Warrant shall be made without charge to the Registered Holder or the Purchaser for
any issuance tax in respect thereof or other cost incurred by the Company in connection with such exercise and the related issuance of shares of Class&nbsp;E Common. Each share of Class&nbsp;E
Common issuable upon exercise of this Warrant shall, upon payment of the Exercise Price therefor, be fully paid and nonassessable and free from all liens and charges with respect to the issuance
thereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;Prior
to the delivery of a Distribution Notice, the Company shall not close its books against the transfer of this Warrant or of any share of Class&nbsp;E Common
issued or issuable upon the exercise of this Warrant in any manner which interferes with the timely exercise of this Warrant. The Company shall from time to time take all such action as may be
necessary to assure that the par value per share of the unissued Class&nbsp;E Common acquirable upon exercise of this Warrant is at all times equal to or less than the Exercise Price then in effect. </FONT></P>

</UL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>2</FONT></P>

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<UL>
<BR>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;The
Company shall at all times reserve and keep available out of its authorized but unissued shares of Class&nbsp;E Common solely for the purpose of issuance upon the
exercise of the Warrants, such number of shares of Class&nbsp;E Common issuable upon the exercise of all outstanding Warrants; </FONT><FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT> <FONT SIZE=2><I>however</I></FONT><FONT SIZE=2>, that if
(A)&nbsp;the number of shares of Class&nbsp;E Common issuable upon exercise of all outstanding Warrants shall increase after the
Date of Issuance as the result of any adjustment required pursuant to Section&nbsp;2 (the increased number of shares issuable hereunder being referred to herein as "Adjustment Shares") and
(B)&nbsp;the Company, at the time of such adjustment (or the transaction or other occurrence triggering such adjustment) does not have sufficient authorized capital stock to reserve and keep
available such additional number of shares of Class&nbsp;E Common as equals the number of Adjustment Shares, then the Company shall be permitted not to reserve and keep available such additional
number of shares of Class&nbsp;E Common as equals the number of Adjustment Shares until the earlier to occur of the date immediately preceding the date of any Distribution Notice and the date that
is forty-five (45)&nbsp;days after the Company's next annual meeting of shareholders. All shares of Class&nbsp;E Common which are so issuable shall, when issued, be duly and validly
issued, fully paid and nonassessable and free from all taxes, liens and charges. The Company shall take all such actions as may be necessary to assure that all such shares of Class&nbsp;E Common may
be so issued without violation of any applicable law or governmental regulation or any requirements of any domestic securities exchange upon which shares of Common Stock may be listed (except for
official notice of issuance which shall be immediately delivered by the Company upon each such issuance). The Company shall not take any action that would cause it to violate the requirements of the
first sentence of this Section&nbsp;1.2(f). </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3.
</FONT><FONT SIZE=2><I>Exercise Agreement</I></FONT><FONT SIZE=2>. Upon any exercise of this Warrant, the Exercise Agreement shall be substantially in the form set forth in </FONT> <FONT SIZE=2><I>Exhibit&nbsp;I </I></FONT><FONT SIZE=2>hereto, except
that if the shares of Class&nbsp;E Common are not to be issued in the name of the Person in whose name this Warrant is
registered, the Exercise Agreement shall also state the name of the Person to whom the certificates for the shares of Class&nbsp;E Common are to be issued, and if the number of shares of
Class&nbsp;E Common to be issued does not include all the shares of Class&nbsp;E Common purchasable hereunder, it shall also state the name of the Person to whom a new Warrant for the unexercised
portion of the rights hereunder is to be delivered. Such Exercise Agreement shall be dated the actual date of execution thereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.
</FONT><FONT SIZE=2><I>ADJUSTMENT OF NUMBER OF SHARES</I></FONT><FONT SIZE=2>. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
order to prevent dilution of the rights granted under this Warrant under certain circumstances, the number of shares of Class&nbsp;E Common obtainable upon exercise of this Warrant
shall be subject to adjustment from time to time as provided in this Section&nbsp;2. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1.
</FONT><FONT SIZE=2><I>Stock Splits, Combinations. etc</I></FONT><FONT SIZE=2>. In case the Company shall hereafter (A)&nbsp;pay a dividend or make a distribution on its Common
Stock in shares of its capital stock (whether shares of Common Stock or of capital stock of any other class), (B)&nbsp;subdivide its outstanding shares of Common Stock or (C)&nbsp;combine its
outstanding shares of Common Stock into a smaller number of shares, the number of shares into which this Warrant is exercisable immediately following such action shall be adjusted so that the Holder
of any Warrant thereafter exercised shall be entitled to receive the number of shares of Class&nbsp;E Common of the Company that represents the same percentage of the outstanding Common Stock which
such Holder would have owned immediately prior to such action had such Warrant been exercised immediately prior thereto and had such dividend, distribution, subdivision, combination or
reclassification been made on a pro rata share-for-share basis. An adjustment made pursuant to this
Section shall become effective immediately after the record date in the case of a dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision,
combination or reclassification. If, as a result of an adjustment made pursuant to this Section, the Holder of any </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>3</FONT></P>

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Warrant thereafter exercised shall become entitled to receive shares of two or more classes of capital stock of the Company, the Board of Directors of the Company (whose determination shall be
conclusive) shall determine the allocation of the Exercise Price between or among shares of such classes of capital stock. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.
</FONT><FONT SIZE=2><I>Reclassification; Merger, Business Combination, etc</I></FONT><FONT SIZE=2>. In case of any reclassification of outstanding shares of Class&nbsp;E Common
issuable upon exercise of the Warrants (other than as set forth in Section&nbsp;2.1 above and other than a change in par value, or from par value to no par value, or from no par value to par value
or as a result of a subdivision or combination), or in the case of any merger, reorganization, restructuring, consolidation, share exchange, business combination, recapitalization or similar
transaction involving the Company in which the Company is not the surviving or resulting entity and which does not constitute a Change in Control, then the Company shall forthwith make lawful and
adequate provision whereby the Holder of such Warrant then outstanding shall have the right thereafter to receive on exercise of such Warrant the kind and amount of shares of stock and other
securities and property receivable upon such reclassification, merger, reorganization, restructuring, consolidation, share exchange, business combination, recapitalization or similar transaction by a
holder of the number of shares of Class&nbsp;E Common issuable upon exercise of such Warrant immediately prior to such reclassification, merger, reorganization, restructuring, consolidation, share
exchange business combination, recapitalization or similar transaction. The above provisions of this Section&nbsp;2.2 shall similarly apply to successive reclassifications, mergers, reorganizations,
restructurings, consolidations, share exchanges, business combinations, recapitalizations or similar transactions. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3.
</FONT><FONT SIZE=2><I>Issuance of Options or Convertible Securities at Below Current Market Price</I></FONT><FONT SIZE=2>. In the event the Company shall, at any time or from time
to time after the date hereof and prior to the Termination Date, issue, sell, distribute or otherwise grant in any manner to all holders of Common Stock any rights to subscribe for or to purchase, or
any warrants or options for the purchase of, Common Stock or any stock or securities convertible into or exchangeable for Common Stock (any such rights, warrants or options being herein called
"Section&nbsp;2.3 Options" and any such convertible or exchangeable stock or securities being herein called "Section&nbsp;2.3 Convertible Securities"), whether or not such Section&nbsp;2.3
Options or the rights to convert or exchange such Section&nbsp;2.3 Convertible Securities are immediately exercisable, and the price per share at which Common Stock is issuable upon the exercise of
such Section&nbsp;2.3 Options or upon the conversion or exchange of such Section&nbsp;2.3 Convertible Securities (determined by dividing (i)&nbsp;the aggregate amount, if any, received or
receivable by the Company as consideration for the issuance, sale, distribution or granting of such Section&nbsp;2.3 Options or any such Convertible Security, plus the minimum aggregate amount of
additional consideration, if any, payable to the Company upon the exercise of all such Section&nbsp;2.3 Options or upon conversion or exchange of all such Section&nbsp;2.3 Convertible Securities,
plus, in the case of rights, options or warrants to acquire Section&nbsp;2.3 Convertible Securities or convertible or exchangeable securities to acquire Section&nbsp;2.3 Options, the minimum
aggregate amount of additional consideration, if any, payable upon the conversion or exchange of all such Section&nbsp;2.3 Convertible Securities or exercise of all such Section&nbsp;2.3 Options,
as the case may be (the "Section&nbsp;2.3 Aggregate Issue Price"), by (ii)&nbsp;the total maximum number of shares of Common Stock issuable upon the exercise of all such Section&nbsp;2.3 Options
or upon the conversion or exchange of all such Section&nbsp;2.3 Convertible Securities or upon the conversion or
exchange of all Section&nbsp;2.3 Convertible Securities issuable upon the exercise of all options or warrants therefor or Section&nbsp;2.3 Options issuable upon the convertible or exchangeable
securities therefor) shall be less than the Current Market Price per share of Common Stock on the record date for the issuance, sale, distribution or granting of such Section&nbsp;2.3 Options or
Section&nbsp;2.3 Convertible Securities (any such event being herein called a "Section&nbsp;2.3 Triggering Derivative Issuance") then, effective upon such Section&nbsp;2.3 Triggering Derivative
Issuance, the number of shares of Class&nbsp;E Common for which this Warrant is </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>4</FONT></P>

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exercisable shall be adjusted to equal the product obtained by multiplying the number of shares of Class&nbsp;E Common for which this Warrant is exercisable immediately prior to such
Section&nbsp;2.3 Triggering Derivative Issuance by a fraction (A)&nbsp;the numerator of which shall be the number of shares of Common Stock outstanding immediately after such Section&nbsp;2.3
Triggering Derivative Issuance (calculated on a fully diluted basis, taking into account such Section&nbsp;2.3 Triggering Derivative Issuance and assuming the exercise of such Section&nbsp;2.3
Options or Section&nbsp;2.3 Convertible Securities, but excluding any adjustments to be made as a result thereof under the Warrants, the Series&nbsp;A Warrants or the Convertible Notes), and
(B)&nbsp;the denominator of which shall be the sum of (1)&nbsp;the number of shares of Common Stock outstanding immediately prior to such Section&nbsp;2.3 Triggering Derivative Issuance
(calculated on a fully diluted basis), and (2)&nbsp;the Section&nbsp;2.3 Aggregate Issuance Price divided by the Current Market Price. No additional adjustment of the Exercise Price shall be made
upon the actual exercise of such Section&nbsp;2.3 Options or upon conversion or exchange of such Section&nbsp;2.3 Convertible Securities or upon the conversion or exchange of the
Section&nbsp;2.3 Convertible Securities issuable upon the exercise of rights, warrants or options, or the exercise of Section&nbsp;2.3 Options issued upon the conversion or exchange of convertible
or exchangeable securities. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4. </FONT> <FONT SIZE=2><I>Issuance of Options or Convertible Securities at 25% Below Current Market Price</I></FONT><FONT SIZE=2>. In the event the Company shall, at any time or from
time to time after the date hereof and prior to the Termination Date, issue, sell, distribute or otherwise grant in any manner to any but not all holders of the Common Stock any rights to subscribe
for or to purchase, or any warrants or options for the purchase of, Common Stock or any stock or securities convertible into or exchangeable for Common Stock (any such rights, warrants or options
being herein called "Section&nbsp;2.4 Options" and any such convertible or exchangeable stock or securities being herein called "Section&nbsp;2.4 Convertible Securities"), whether or not such
Section&nbsp;2.4 Options or the rights to convert or exchange such Section&nbsp;2.4 Convertible Securities are immediately exercisable, and the price per share at which Common Stock is issuable
upon the exercise of such Section&nbsp;2.4 Options or upon the conversion or exchange of such Section&nbsp;2.4 Convertible Securities (determined by dividing (i)&nbsp;the aggregate amount, if
any, received or receivable by the Company as consideration for the issuance, sale, distribution or granting of such Section&nbsp;2.4 Options or any such Section&nbsp;2.4 Convertible Security,
plus the minimum aggregate amount of additional consideration, if any, payable to the Company upon the exercise of all such Section&nbsp;2.4 Options or upon conversion or exchange of all such
Section&nbsp;2.4 Convertible Securities, plus, in the case of rights, options or warrants to acquire Section&nbsp;2.4 Convertible Securities or convertible or exchangeable securities to acquire
Section&nbsp;2.4 Options, the minimum aggregate amount of additional consideration, if any, payable upon the conversion or exchange of all such Section&nbsp;2.4 Convertible Securities or exercise
of all such Section&nbsp;2.4 Options, as the case may be (the "Section&nbsp;2.4 Aggregate Issue Price"), by (ii)&nbsp;the total maximum number of shares of Common Stock issuable upon the
exercise of all such Section&nbsp;2.4 Options or upon the conversion or exchange of all such Section&nbsp;2.4 Convertible Securities or upon the conversion or exchange of all Section&nbsp;2.3
Convertible Securities issuable upon the exercise of all options or warrants therefor or Section&nbsp;2.3 Options issuable upon the convertible or exchangeable securities therefor) shall be less
than 75% of the Current Market Price per share of Common Stock on the record date for the issuance, sale, distribution or granting of such Section&nbsp;2.4 Options or Section&nbsp;2.4 Convertible
Securities (any such event being herein called a "Section&nbsp;2.4 Triggering Derivative
Issuance") then, effective upon such Section&nbsp;2.4 Triggering Derivative Issuance, the number of shares of Class&nbsp;E Common for which this Warrant is exercisable shall be adjusted to equal
the product obtained by multiplying the number of shares of Class&nbsp;E Common for which this Warrant is exercisable immediately prior to such Section&nbsp;2.4 Triggering Derivative Issuance by a
fraction (A)&nbsp;the numerator of which shall be the number of shares of Common Stock outstanding immediately after such Section&nbsp;2.4 Triggering Derivative Issuance (calculated on a fully
diluted basis, taking into account such Section&nbsp;2.4 Triggering </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>5</FONT></P>

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Derivative Issuance and assuming the exercise of such Section&nbsp;2.4 Options or Section&nbsp;2.4 Convertible Securities, but excluding any adjustments to be made as a result thereof under the
Warrants, the Series&nbsp;A Warrants or the Convertible Notes), and (B)&nbsp;the denominator of which shall be the sum of (1)&nbsp;the number of shares of Common Stock outstanding immediately
prior to such Section&nbsp;2.4 Triggering Derivative Issuance (calculated on a fully diluted basis), and (2)&nbsp;the Section&nbsp;2.4 Aggregate Issuance Price divided by the Current Market
Price. No additional adjustment of the Exercise Price shall be made upon the actual exercise of such Section&nbsp;2.4 Options or upon conversion or exchange of such Section&nbsp;2.4 Convertible
Securities or upon the conversion or exchange of the Section&nbsp;2.4 Convertible Securities issuable upon the exercise of rights, warrants or options, or the exercise of Section&nbsp;2.4 Options
issued upon the conversion or exchange of convertible or exchangeable securities. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5.
</FONT><FONT SIZE=2><I>Issuance of Additional Shares of Common Stock at Below Current Market Price</I></FONT><FONT SIZE=2>. If at any time the Company shall (except as hereinafter
provided) issue or sell any additional shares of Common Stock in a transaction that was offered to all holders of Common Stock then outstanding for consideration in an amount per additional share of
Common Stock less than the Current Market Price, then the number of shares of Class&nbsp;E Common for which this Warrant is exercisable shall be adjusted to equal the product obtained by multiplying
the number of shares of Class&nbsp;E Common for which this Warrant is exercisable immediately prior to such issue or sale by a fraction (A)&nbsp;the numerator of which shall be the number of
shares of Common Stock outstanding immediately after such issue or sale (calculated on a fully diluted basis, taking into account such issue or sale, but excluding any adjustments to be made as a
result thereof under the Warrants, the Series&nbsp;A Warrants or the Convertible Notes), and (B)&nbsp;the denominator of which shall be the sum of (1)&nbsp;the number of shares of Common Stock
outstanding immediately prior to such issue or sale (calculated on a fully diluted basis), and (2)&nbsp;the aggregate consideration received from the issuance or sale of the additional shares of
Common Stock divided by the Current Market Price. For the purposes of this Section&nbsp;2.5, the date as of which the Current Market Price per share of Common Stock shall be computed shall be the
earlier of (a)&nbsp;the date on which the Company shall enter into a firm contract for the issuance of such additional shares of Common Stock or (b)&nbsp;the date of actual issuance of such
additional shares of Common Stock. Notwithstanding the foregoing, no adjustment shall be made under this Section for issuances of shares of Common Stock (i)&nbsp;upon exercise of the Warrants,
(ii)&nbsp;upon conversion of the outstanding Convertible Notes, (iii)&nbsp;upon exercise, conversion or exchange of any Section&nbsp;2.3 Options, Section&nbsp;2.4 Options, Section&nbsp;2.3
Convertible Securities or Section&nbsp;2.4 Convertible Securities, or (iv)&nbsp;in the event that the issuance of Common Stock giving rise to such adjustment is part of a transaction in which the
holder of this Warrant is given the opportunity to purchase such shares of Common Stock at the same price per share as all other offerees in the offering and on a pro rata
share-for-share basis with all other offerees. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.6.
</FONT><FONT SIZE=2><I>Issuance of Additional Shares of Common Stock at 25% Below Current Market Price</I></FONT><FONT SIZE=2>. If at any time the Company shall (except as
hereinafter provided) issue or sell any additional shares of Common Stock other than in a transaction that was offered to all holders of Common Stock then outstanding for consideration in an amount
per additional share of Common Stock less than 75% of the Current
Market Price, then the number of shares of Class&nbsp;E Common for which this Warrant is exercisable shall be adjusted to equal the product obtained by multiplying the number of shares of
Class&nbsp;E Common for which this Warrant is exercisable immediately prior to such issue or sale by a fraction (A)&nbsp;the numerator of which shall be the number of shares of Common Stock
outstanding immediately after such issue or sale (calculated on a fully diluted basis, taking into account such issue or sale, but excluding any adjustments to be made as a result thereof under the
Warrants, the Series&nbsp;A Warrants or the Convertible Notes), and (B)&nbsp;the denominator of which shall be the sum of (1)&nbsp;the number of shares of Common Stock outstanding immediately
prior to such issue or sale (calculated on a fully diluted basis), and (2)&nbsp;the aggregate consideration received </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>6</FONT></P>

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from the issuance or sale of the additional shares of Common Stock divided by the Current Market Price. For the purposes of this Section&nbsp;2.6, the date as of which the Current Market Price per
share of Common Stock shall be computed shall be the earlier of (a)&nbsp;the date on which the Company shall enter into a firm contract for the issuance of such additional shares of Common Stock or
(b)&nbsp;the date of actual issuance of such additional shares of Common Stock. Notwithstanding the foregoing, no adjustment shall be made under this Section for issuances of shares of Common Stock
(i)&nbsp;upon exercise of the Warrants, (ii)&nbsp;upon conversion of the Convertible Notes, (iii)&nbsp;upon exercise, conversion or exchange of any Section&nbsp;2.3 Options, Section&nbsp;2.4
Options, Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities, or (iv)&nbsp;in the event that the issuance of Common Stock giving rise to such adjustment is part of
a transaction in which the holder of this Warrant is given the opportunity to purchase such shares of Common Stock at the same price per share as all other offerees in the offering and on a pro rata
share-for-share basis with all other offerees. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.7.
</FONT><FONT SIZE=2><I>Certain Other Distributions</I></FONT><FONT SIZE=2>. If the Company shall pay a dividend or make any other distribution payable in Section&nbsp;2.3
Options, Section&nbsp;2.4 Options, Section&nbsp;2.3 Convertible Securities and Section&nbsp;2.4 Convertible Securities, then, for purposes of Sections 2.3 and 2.4 above, such Section&nbsp;2.3
Options, Section&nbsp;2.4 Options, Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities shall be deemed to have been issued or sold without consideration. Nothing
in this Section&nbsp;2.7 is intended to alter the component involving the exercise price contained in the calculations under Sections 2.3 or 2.4 with respect to any Section&nbsp;2.3 Options,
Section&nbsp;2.3 Convertible Securities, Section&nbsp;2.4 Options or Section&nbsp;2.4 Convertible Securities that are issued with an exercise price. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.8.
</FONT><FONT SIZE=2><I>Consideration Received</I></FONT><FONT SIZE=2>. If any shares of Common Stock, Section&nbsp;2.3 Options, Section&nbsp;2.4 Options, Section&nbsp;2.3
Convertible Securities or Section&nbsp;2.4 Convertible Securities shall be issued, sold or distributed for a consideration other than cash, the amount of the consideration other than cash received
by the Company in respect thereof shall be deemed to be the then fair market value of such consideration (as determined in good faith by the Board of Directors of the Company). If any
Section&nbsp;2.3 Options, Section&nbsp;2.3 Options, Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities shall be issued in connection with the issuance and sale
of other securities of the Company, together comprising one integral transaction in which no specific consideration is allocated to such Section&nbsp;2.3 Options, Section&nbsp;2.4 Options,
Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities by the parties thereto, such Section&nbsp;2.3 Options, Section&nbsp;2.4 Options, Section&nbsp;2.3
Convertible Securities or Section&nbsp;2.4 Convertible Securities shall be deemed to have been issued without consideration; provided, however, that if such Section&nbsp;2.3 Options,
Section&nbsp;2.4 Options, Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities have an exercise price equal to or greater than the Current Market Price of the
Common Stock on the date of issuance of such Section&nbsp;2.3 Options, Section&nbsp;2.4 Options, Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities, then such
Section&nbsp;2.3 Options, Section&nbsp;2.4 Options, Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities shall be deemed to have
been issued for consideration equal to such exercise price. Nothing in this Section&nbsp;2H is intended to alter the component involving the exercise price contained in the calculations under
Sections 2.3 or 2.4 with respect to any Section&nbsp;2.3 Options, Section&nbsp;2.3 Convertible Securities, Section&nbsp;2.4 Options or Section&nbsp;2.4 Convertible Securities that are issued
with an exercise price. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.9.
</FONT><FONT SIZE=2><I>Expiration of Options and Convertible Securities</I></FONT><FONT SIZE=2>. If, at any time after any adjustment to the number of shares of Class&nbsp;E
Common purchasable upon the exercise of each Warrant shall have been made pursuant to Sections 2.3 or 2.4 above or this Section&nbsp;2.9, any Section&nbsp;2.3 Options, Section&nbsp;2.4 Options,
Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities shall have expired unexercised, the number of such shares so purchasable shall, upon such expiration, be
readjusted and shall thereafter be such as they would have been had they been originally adjusted </FONT></P>

</UL>
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(or had the original adjustment not been required, as the case may be) as if (i)&nbsp;the only shares of Common Stock deemed to have been issued in connection with such Section&nbsp;2.3 Options,
Section&nbsp;2.4 Options, Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities were the shares of Common Stock, if any, actually issued or sold upon the exercise of
such Section&nbsp;2.3 Options, Section&nbsp;2.4 Options, Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities and (ii)&nbsp;such shares of Common Stock, if any,
were issued or sold for the consideration actually received by the Company upon such exercise, conversion or exchange plus the aggregate consideration, if any, actually received by the Company for the
issuance, sale, distribution or granting of all such Section&nbsp;2.3 Options, Section&nbsp;2.4 Options, Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities,
whether or not exercised, plus, in the case of rights, options or warrants to acquire Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities or convertible or
exchangeable securities to acquire Section&nbsp;2.3 Options or Section&nbsp;2.4 Options, the minimum aggregate amount of additional consideration, if any, payable upon the exercise, conversion or
exchange of all such rights, options, warrants or convertible or exchangeable securities; provided that no such readjustment shall have the effect of decreasing the number of such shares so
purchasable by an amount (calculated by adjusting such decrease to account for all other adjustments made pursuant to this Section&nbsp;2 following the date of the original adjustment referred to
above) in excess of the amount of the adjustment initially made in respect of the issuance, sale, distribution or granting of such Section&nbsp;2.3 Options, Section&nbsp;2.4 Options,
Section&nbsp;2.3 Convertible Securities or Section&nbsp;2.4 Convertible Securities. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.10.
</FONT><FONT SIZE=2><I>Notice</I></FONT><FONT SIZE=2>. As soon as reasonably practicable after any adjustment of the Exercise Price or the number of shares of Class&nbsp;E
Common for which this Warrant is exercisable, and in no event later than the date of the first Distribution Notice delivered thereafter, the Company shall give written notice thereof to the Registered
Holder, setting forth in reasonable detail and certifying the calculation of such adjustment. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.11.
</FONT><FONT SIZE=2><I>Other Adjustments</I></FONT><FONT SIZE=2>. In the event that at any time, as a result of an adjustment made pursuant to this Section&nbsp;2, the Holders
shall become entitled to receive any securities of the Company other than shares of Common Stock, thereafter the number of such other securities so receivable upon exercise of the Warrants and the
Exercise Price applicable to such exercise shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to the shares of
Common Stock contained in this Section&nbsp;2. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.
</FONT><FONT SIZE=2><I>DEFINITIONS.</I></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following terms have meanings set forth below: </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Affiliate</I></FONT><FONT SIZE=2>" of any Person shall mean any Person, directly or indirectly, through one or more intermediaries, controlling, controlled by,
or under common control with such Person. The term "control," as used in the immediately preceding sentence, shall mean with respect to a corporation or limited liability company, the right to
exercise, directly or indirectly, more than fifty percent (50%) of the voting rights attributable to the controlled corporation or limited liability company, and, with respect to any individual,
partnership, trust, other entity or association, the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of the controlled entity or the
actions of the individual, as the case may be. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Change of Control</I></FONT><FONT SIZE=2>" means (i)&nbsp;a merger, reorganization, restructuring, consolidation, share exchange, business combination,
recapitalization, liquidation, dissolution or similar transaction involving the Company in which the Company is not the surviving or resulting entity, as a result of which the Company's stockholders
prior to such transactions, MatlinPatterson Global Opportunities Partners, L.P., any Affiliates of MatlinPatterson Global Opportunities Partners L.P. and any Group that includes as a member
MatlinPatterson Global Opportunities Partners L.P. or </FONT></P>

</UL>
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any Affiliates of MatlinPatterson Global Opportunities Partners L.P. cease to own at least 50% of the voting securities of the entity surviving or resulting from such transaction (or the ultimate
parent entity thereof), or (ii)&nbsp;the acquisition, directly or indirectly, by any Person (other than MatlinPatterson Global Opportunities Partners L.P. or its Affiliates or any Group that
includes as a member MatlinPatterson Global Opportunities Partners L.P. or any Affiliates of MatlinPatterson Global Opportunities Partners L.P.) of 50% or more of the Company's voting securities
whether by merger, consolidation, share exchange, business combination, tender or exchange offer, issuance or sale of securities or otherwise, other than in any such transaction following which the
Company's stockholders prior to such transaction, MatlinPatterson Global Opportunities Partners, L.P., any Affiliates of MatlinPatterson Global Opportunities Partners, L.P. and any Group that includes
as a member MatlinPatterson Global Opportunities Partners, L.P. or any Affiliates of MatlinPatterson Global Opportunities Partners, L.P., continue to own at least 50% of the voting securities of the
entity surviving or resulting from such transaction (or the ultimate parent entity thereof). </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Class&nbsp;E Common</I></FONT><FONT SIZE=2>" means shares of the Company's Class&nbsp;E Common Stock, par value $.01 per share; provided that if there is a
change such that the securities issuable upon exercise of the Warrants are issued by an entity other than the Company or there is a change in the type or class of securities so issuable, then the term
"Class&nbsp;E Common" shall mean one share of the security issuable upon exercise of the Warrants if such security is issuable in shares, or shall mean the smallest unit in which such security is
issuable if such security is not issuable in shares. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Common Stock</I></FONT><FONT SIZE=2>" means, collectively, the Company's Class&nbsp;A Common Stock, the Company's Class&nbsp;B Common Stock, the Company's
Class&nbsp;C Common Stock, the Company's Class&nbsp;E Common Stock, the Company's Class&nbsp;E Common Stock and any capital stock of any class of the Company hereafter authorized which is not
limited to a fixed sum or percentage of par or stated value in respect to the rights of the holders thereof to participate in dividends or in the distribution of assets upon any liquidation,
dissolution or winding up of the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Convertible Notes</I></FONT><FONT SIZE=2>" means the $50,000,000 principal amount of 10% convertible subordinated notes due December&nbsp;2007 issued by the
Company pursuant to the Plan. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Current Market Price</I></FONT><FONT SIZE=2>" means, for the purpose of any computation of Current Market Price pursuant to this Warrant, the Current Market
Price per share of Common Stock at any date shall be the average of the daily closing sales prices for the shorter of (i)&nbsp;the 20 consecutive trading days ending on the last full trading day on
the exchange or market specified in the second succeeding sentence prior to the Time of Determination (as defined below) and (ii)&nbsp;the period commencing on the date next succeeding the first
public announcement of the issuance, sale, distribution or granting in question through such last full trading day prior to the Time of Determination; provided that in the case of a firm commitment
underwritten public offering, the Current Market Price shall mean the closing price of the Common Stock on the day of the pricing of such offering. The term "Time of Determination" as used herein
shall be the time and date of the earlier to occur of (A)&nbsp;the date as of which the Current Market Price is to be computed and (B)&nbsp;the last full trading day on such exchange or market
before the commencement of "ex-dividend" trading in the Common Stock relating to the event giving rise to the adjustment required by Sections 2.1, 2.2, 2.3, 2.4, 2.5 or 2.7. The closing
price for any day shall be the last reported sale price regular way or, in case no such reported sale takes place on such day, the average of the closing bid and asked prices regular way for such day,
in each case (1)&nbsp;on the principal national securities exchange on which the shares of Common Stock are listed or to which such shares are admitted to trading or (2)&nbsp;if the Common Stock
is not listed or admitted to trading on a national securities exchange, in the over-the-counter market as reported by the NASDAQ National Market or any comparable system or
(3)&nbsp;if the Common Stock is not listed on the NASDAQ National Market or a comparable system, the fair market value as determined in good faith by the Board of Directors of the Company for that
purpose. </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>9</FONT></P>

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<UL>
<BR>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Exchange Act</I></FONT><FONT SIZE=2>" means the Securities Exchange Act of 1934, as amended. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Group</I></FONT><FONT SIZE=2>" means a "group" within the meaning of Section&nbsp;13(d)(3) of the Exchange Act. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Person</I></FONT><FONT SIZE=2>" means an individual, a partnership, a limited liability partnership, a joint venture, a corporation, a limited liability company,
a trust, an unincorporated organization, any other legal entity and a government or any department or agency thereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Series&nbsp;A Warrants</I></FONT><FONT SIZE=2>" means the Company's Series&nbsp;A Warrants to purchase Class&nbsp;D Common Stock, issued pursuant to the
Plan. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.
</FONT><FONT SIZE=2><I>NO VOTING RIGHTS; LIMITATIONS OF LIABILITY.</I></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
Warrant shall not entitle the holder hereof to any voting rights or other rights as a stockholder of the Company. No provision hereof, in the absence of affirmative action by the
Registered Holder to purchase Class&nbsp;E Common, and no enumeration herein of the rights or privileges of the Registered Holder shall give rise to any liability of such holder for the Exercise
Price of Class&nbsp;E Common acquirable by exercise hereof or as a stockholder of the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.
</FONT><FONT SIZE=2><I>WARRANT TRANSFERABLE.</I></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
Warrant and all rights hereunder are transferable, in whole or in part, without charge to the Registered Holder, upon surrender of this Warrant with a properly executed Assignment
(in the form of </FONT><FONT SIZE=2><I>Exhibit&nbsp;II </I></FONT><FONT SIZE=2>hereto) at the office or agency of the Warrant Agent. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.
</FONT><FONT SIZE=2><I>WARRANT EXCHANGEABLE FOR DIFFERENT DENOMINATIONS.</I></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
Warrant is exchangeable, upon the surrender hereof by the Registered Holder at the office or agency of the Warrant Agent, for new Warrants of like tenor representing in the
aggregate the purchase rights hereunder, and each of such new Warrants shall represent such portion of such rights as is designated by the Registered Holder at the time of such surrender. The date the
Company initially issues this Warrant shall be deemed to be the "Date of Issuance" hereof regardless of the number of times new certificates representing the unexpired and unexercised rights formerly
represented by this Warrant shall be issued. All Warrants representing portions of the rights hereunder are referred to herein as the "Warrants." </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.
</FONT><FONT SIZE=2><I>REPLACEMENT.</I></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon
receipt of evidence reasonably satisfactory to the Company (an affidavit of the Registered Holder shall be satisfactory) of the ownership and the loss, theft, destruction or
mutilation of any certificate evidencing this Warrant, and in the case of any such loss, theft or destruction, upon receipt of indemnity reasonably satisfactory to the Company (provided that if the
holder is a financial institution or other institutional investor its own agreement shall be satisfactory), or, in the case of any such mutilation upon surrender of such certificate, the Company shall
(at its expense) execute and deliver in
lieu of such certificate a new certificate of like kind representing the same rights represented by such lost, stolen, destroyed or mutilated certificate and dated the date of such lost, stolen,
destroyed or mutilated certificate. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.
</FONT><FONT SIZE=2><I>NOTICES.</I></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except
as otherwise expressly provided herein, all notices referred to in this Warrant shall be in writing and shall be delivered personally, sent by reputable overnight courier service
(charges prepaid) or sent by registered or certified mail, return receipt requested, postage prepaid and shall be deemed to have been given when so delivered, sent or deposited in the U.S. Mail
(i)&nbsp;to the Company, at its principal executive offices and (ii)&nbsp;to the Registered Holder of this Warrant, at such holder's address as it appears in the records of the Company (unless
otherwise indicated by any such holder). </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>10</FONT></P>

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<UL>
<BR>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.
</FONT><FONT SIZE=2><I>AMENDMENT AND WAIVER</I></FONT><FONT SIZE=2>. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except
as otherwise provided herein, the provisions of all of the Warrants may be amended and the Company may take any action herein prohibited, or omit to perform any act herein
required to be performed by it, only if the Company has obtained the written consent of the Registered Holders of Warrants representing a majority of the shares of Class&nbsp;E Common obtainable
upon exercise of the Warrants; </FONT><FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT><FONT SIZE=2><I>however</I></FONT><FONT SIZE=2>, that the Company may amend the provisions of any
single Warrant with the written consent of the Registered Holder of such Warrant. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.
</FONT><FONT SIZE=2><I>DESCRIPTIVE HEADINGS; GOVERNING LAW</I></FONT><FONT SIZE=2>. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
descriptive headings of the several Sections and paragraphs of this Warrant are inserted for convenience only and do not constitute a part of this Warrant. The corporation laws of
the State of Delaware shall govern all issues concerning the relative rights of the Company and its stockholders. All other questions concerning the construction, validity, enforcement and
interpretation of this Warrant shall be governed by the internal law of the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of
New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>*
* * * * </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>11</FONT></P>

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<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN
WITNESS WHEREOF, the Company has caused this Warrant to be signed and attested by its duly authorized officers under its corporate seal and to be dated the Date of Issuance hereof. </FONT></P>
</UL>
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<TABLE WIDTH="78%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TD COLSPAN=3 VALIGN="TOP"><FONT SIZE=2>Countersigned and Registered:</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="TOP"><FONT SIZE=2><B>POLYMER GROUP, INC.</B></FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD COLSPAN=3 VALIGN="TOP"><FONT SIZE=2><BR>
WACHOVIA BANK, N.A., as<BR>
Warrant Agent</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="7%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2>By</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="7%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" ALIGN="CENTER" VALIGN="TOP"><HR NOSHADE></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="7%" VALIGN="TOP"><FONT SIZE=2>By:</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="7%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" ALIGN="CENTER" VALIGN="TOP"><HR NOSHADE><FONT SIZE=2> Authorized Signature</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="7%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2>Its</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="7%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" ALIGN="CENTER" VALIGN="TOP"><HR NOSHADE></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD COLSPAN=3 VALIGN="TOP"><FONT SIZE=2><B>[Corporate Seal]</B></FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD COLSPAN=3 VALIGN="TOP"><FONT SIZE=2><BR>
Attest:</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="7%" ALIGN="RIGHT" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD COLSPAN=3 ALIGN="CENTER" VALIGN="TOP"><BR><HR NOSHADE><FONT SIZE=2> Secretary<BR></FONT>
</TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="41%" VALIGN="TOP"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
</TABLE>
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<P ALIGN="RIGHT"><FONT SIZE=2>EXHIBIT I </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>EXERCISE AGREEMENT </FONT></P>

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<TABLE WIDTH="76%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="TOP">
<TD WIDTH="50%"><FONT SIZE=2>To:</FONT></TD>
<TD WIDTH="50%"><FONT SIZE=2>Dated:</FONT></TD>
</TR>
</TABLE>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
undersigned, pursuant to the provisions set forth in the attached Warrant (Certificate No.&nbsp;W-&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;), hereby agrees to subscribe for the purchase of
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares of the Class&nbsp;E Common covered by such Warrant and makes payment herewith in full therefor at the price per share provided by such Warrant. </FONT></P>

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<TR VALIGN="TOP">
<TD WIDTH="43%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%"><FONT SIZE=2>Signature</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="43%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="43%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="43%" ALIGN="CENTER"><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="43%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="11%"><FONT SIZE=2><BR>
Address</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="43%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="43%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="43%" ALIGN="CENTER"><HR NOSHADE></TD>
</TR>
</TABLE>
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<BR>
<P><br><A NAME="03CHI1872_6">QuickLinks</A><br></P><!-- TOC_BEGIN -->
<UL>
<FONT SIZE=2><A HREF="#toc_kr1872_1">EXHIBIT 4.2</A></FONT><BR>
</UL>
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