POLYMER GROUP INC
EX-10.1
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<TYPE>EX-10.1
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<FILENAME>a06-9411_1ex10d1.htm
<DESCRIPTION>EX-10.1
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<p align="right" style="margin:0pt 0pt 12.0pt;page-break-after:avoid;text-align:right;text-decoration:underline;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;text-decoration:none;">Exhibit&nbsp;10.1</font></b></p>

<p style="margin:0pt 0pt 12.0pt;page-break-after:avoid;text-align:center;text-decoration:underline;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;text-decoration:none;">POLYMER GROUP, INC.</font></b></p>

<p style="margin:0pt 0pt 12.0pt;page-break-after:avoid;text-align:center;text-decoration:underline;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">EXECUTIVE EMPLOYMENT AGREEMENT</font></u></b></p>

<p style="margin:0pt 0pt 12.0pt;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">THIS AGREEMENT is entered into on March&nbsp;24, 2006,
between Polymer Group,&nbsp;Inc., a Delaware corporation (the &#147;Company&#148;), and
James L. Schaeffer (&#147;Executive&#148;).</font></p>

<p style="margin:0pt 0pt 12.0pt;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In consideration of the mutual covenants contained
herein and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:</font></p>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Employment Period</u>. The Company shall employ
Executive, and Executive hereby accepts employment with the Company, upon the
terms and conditions set forth in this Agreement for the period beginning on
and as of April&nbsp;1, 2006 and ending on March&nbsp;31, 2009, unless
otherwise terminated earlier as provided in paragraph 4 hereof (the &#147;<u>Employment
Period</u>&#148;).</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Position and Duties</u>.</font></h1>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; During the
Employment Period, Executive shall serve as the Chief Executive Officer of the
Company and shall have the normal duties, responsibilities, functions and
authority of the Chief Executive Officer, subject to the power and authority of
the Board to expand or limit such duties, responsibilities, functions and
authority within the scope of duties, responsibilities, functions and authority
associated with the position of Chief Executive Officer and to overrule&nbsp;actions
of officers of the Company. During the Employment Period, Executive shall
render such executive and managerial services to the Company and its
Subsidiaries which are consistent with Executive&#146;s position and as the Board
may from time to time direct.</font></h2>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; During the
Employment Period, Executive shall report to the Board and shall devote his
best efforts and his full business time and attention (except for permitted
vacation periods and reasonable periods of illness or other incapacity)
exclusively to the business and affairs of the Company and its Subsidiaries. Executive
shall perform his duties, responsibilities and functions to the Company and its
Subsidiaries hereunder to the best of his abilities in a diligent, trustworthy,
professional and efficient manner and shall comply with the Company&#146;s and its
Subsidiaries&#146; policies and procedures in all material respects. In performing
his duties and exercising his authority under the Agreement, Executive shall
support and implement the business and strategic plans approved from time to
time by the Board and shall support and cooperate with the Company&#146;s and its
Subsidiaries&#146; efforts to expand their businesses and operate profitably and in
conformity with the business and strategic plans approved by the Board. So long
as Executive is employed by the Company, Executive shall not, without the prior
written consent of the Board, accept other employment or perform other services
for compensation. Notwithstanding the foregoing, it shall not be considered a
violation of this Agreement if during the Employment Period Executive (i)&nbsp;agrees
to serve on the board of directors of one other company with operations related
to the nonwovens field which would not be considered to be a competitor of the
company and devotes a reasonable amount of time to performing his duties as an
outside director of such company, or (ii)&nbsp;serves on civic or charitable</font></h2>

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<p style="margin:0pt 0pt 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">boards or committees consistent with his status as a
full-time executive officer, so long as such activities do not significantly
interfere with his performance of his responsibilities as an executive officer
of the Company.</font></p>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; For purposes of this
Agreement, &#147;<u>Subsidiaries</u>&#148; shall mean any corporation or other entity of
which the securities or other ownership interests having the voting power to
elect a majority of the board of directors or other governing body are, at the
time of determination, owned by the Company, directly or through one of more
Subsidiaries.</font></h2>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Compensation and Benefits</u>.</font></h1>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; During the
Employment Period, Executive&#146;s base salary shall be $650,000 per annum,
effective on and after April&nbsp;1, 2006, or such higher rate as the Board may
determine from time to time (as adjusted from time to time, the &#147;<u>Base Salary</u>&#148;),
which salary shall be payable by the Company in regular installments in
accordance with the Company&#146;s general payroll practices (in effect from time to
time). The Board shall undertake an annual review of Executive&#146;s Base Salary,
and shall approve such increases to such Base Salary by such amounts, if any,
as the Board determines to be appropriate. In addition, during the Employment
Period, Executive shall be entitled to participate in all of the Company&#146;s
employee benefit programs for which senior executive employees of the Company
and its Subsidiaries are generally eligible, and Executive shall be entitled to
four weeks of paid vacation each calendar year in accordance with the Company&#146;s
policies, which if not taken during any year may not be carried forward to any
subsequent calendar year and no compensation shall be payable in lieu thereof. During
the Employment Period, the Company shall provide Executive with a car
comparable to that which he is using on the date of this Agreement (&#147;Car&#148;). The
Employee shall take good care of the Car and ensure that the provisions and
conditions of any policy of insurance relating thereto are observed (including
the provision with respect to protection of the Car), and in the event that the
Employee&#146;s employment terminates for whatever reason, he shall forthwith return
the Car with the keys and all licenses and other documentation relating to the
Car, to the Company. The Employee shall not have any lien right in the Car or
in any document or property relating thereto.</font></h2>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; During the
Employment Period, the Company shall reimburse Executive for all reasonable
business expenses incurred by him in the course of performing his duties and
responsibilities under this Agreement which are consistent with the Company&#146;s
policies in effect from time to time with respect to travel, entertainment and
other business expenses, subject to the Company&#146;s requirements with respect to
reporting and documentation of such expenses.</font></h2>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; In addition to the
Base Salary, the Board may, in its sole discretion, award a bonus to Executive
following the end of each fiscal year during the Employment Period based upon
Executive&#146;s performance and the Company&#146;s operating results during such year; <u>provided</u>,
that Executive shall be entitled to a minimum performance bonus opportunity
each year of not less than 50% of his Base Salary, which bonus shall be payable
upon the achievement by the Company of certain performance target levels
established by the Board for Executive and the other senior executive officers
of the Company. In addition, Executive may be eligible for specific bonuses as
may be determined by the Board from time to time relating to certain
extraordinary corporate events, such as acquisitions or dispositions.</font></h2>


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<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; In addition to the
Base Salary and any bonuses payable to Executive pursuant to this paragraph, Executive
shall be entitled to health insurance and disability insurance of such coverage
as reasonably determined by the Board and term life insurance in an amount
equal to two times Executive&#146;s Base Salary.</font></h2>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(e)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; During the
Employment Period, Executive shall also be entitled to reasonable periods of
sick leave (without loss of pay) in accordance with the Company&#146;s policies as
in effect from time to time.</font></h2>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(f)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; All amounts payable
to Executive as compensation hereunder shall be subject to all required and
customary withholding by the Company.</font></h2>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Term</u>.</font></h1>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; Unless renewed by
the mutual agreement of the Company and Executive, the Employment Period shall
end on March&nbsp;31, 2009. The Employment Period shall terminate prior to such
date (i)&nbsp;immediately upon Executive&#146;s resignation (with or without Good
Reason, as defined below), death or Disability and (ii)&nbsp;the Employment
Period may be terminated by the Company at any time prior to such date for
Cause (as defined below) or without Cause. Except as otherwise provided herein,
any termination of the Employment Period by the Company shall be effective as
specified in a written notice, or oral notice later confirmed in writing, from
the Company to Executive.</font></h2>

<h2 style="font-family:Times New Roman;font-size:10.0pt;font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; If the Employment
Period is terminated by the Company without Cause or upon Executive&#146;s
resignation with Good Reason during the term of this Agreement, Executive shall
be entitled to receive from the Company as special severance payments an amount
equal to (i)&nbsp;his Base Salary, as in effect immediately prior to the date of
his termination, for the period equal to the 36 month anniversary of the date
of termination</font><b><font style="font-weight:bold;"> </font></b>(the &#147;<u>Severance
Period</u>&#148;), and (ii)&nbsp;his target bonus opportunity for the fiscal year in
which the termination date occurs, multiplied by a fraction equal to the number
of days of employment completed by Executive during the fiscal year in which
the termination date occurs divided by 365, in each case if and only if
Executive has executed and delivered to the Company the General Release
substantially in form and substance as set forth in <u>Exhibit&nbsp;A</u>
attached hereto and only so long as Executive has not breached the provisions
of paragraphs 5, 6 and 7 hereof and does not apply for unemployment
compensation chargeable to the Company during the Severance Period, and Executive
shall not be entitled to any other salary, compensation or benefits after
termination of the Employment Period, except as specifically provided for in
the Company&#146;s employee benefit plans or as otherwise expressly required by
applicable law. The Base Salary payable pursuant to this paragraph 4(b)&nbsp;for
the first six months of the Severance Period and the target bonus opportunity
shall be paid to Executive in a lump sum on the first day of the calendar month
following the six month anniversary of the termination date, and the Base
Salary payable pursuant to this paragraph 4(b)&nbsp;for the remainder of the
Severance Period shall be payable in regular monthly installments. The amounts
payable pursuant to this paragraph 4(b)&nbsp;shall not be reduced by the amount
of any compensation Executive receives with respect to any other employment
during the Severance Period.</h2>


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<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; If the Employment
Period is terminated by the Company for Cause or is terminated pursuant to
clause (a)(i)&nbsp;above (other than termination with Good Reason) or expires
and is not renewed hereunder, Executive shall only be entitled to receive his
Base Salary through the date of termination or expiration and shall not be
entitled to any other salary, compensation or benefits from the Company or its
Subsidiaries thereafter, except as otherwise specifically provided for under
the Company&#146;s employee benefit plans or as otherwise expressly required by
applicable law.</font></h2>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; For twelve months
following the date of Executive&#146;s termination, the Company shall, at its expense,
continue on behalf of the Executive and his dependants and beneficiaries, the
life insurance, disability, medical, dental and hospitalization benefits
provided to the Executive immediately prior to the date of termination. The
coverage and benefits (including deductibles and costs) provided in this Section&nbsp;4(d)&nbsp;shall
be no less favorable to the Executive and his dependants and beneficiaries,
than the coverage and benefits provided to Executive immediately prior to his
termination. The Company&#146;s obligation hereunder with respect to the foregoing
benefits shall be limited to the extent that the Executive obtains any such
benefits pursuant to a subsequent employer&#146;s benefit plans, in which case the
Company may reduce the coverage of any benefits it is required to provide the
Executive hereunder so long as the aggregate coverage and benefits of the
combined benefit plans is no less favorable to the Executive than the coverages
and benefits required to be provided hereunder. This subsection (d)&nbsp;shall
not be interpreted so as to limit any benefits to which the Executive, his
dependants or beneficiaries may otherwise be entitled under any of the Company&#146;s
employee benefit plans, programs or practices following the termination of
employment of the Executive, including without limitation, any applicable
retiree medical and life insurance benefits. Except as otherwise expressly
provided herein, all of Executive&#146;s rights to salary, bonuses, employee
benefits and other compensation hereunder which would have accrued or become
payable after the termination or expiration of the Employment Period shall
cease upon such termination or expiration, other than those expressly required
under applicable law (such as COBRA); <u>provided</u>, that for purposes of
determining Executive&#146;s rights under COBRA, the date of the later to occur of (x)&nbsp;the
date of the termination or expiration of the Employment Period or (y)&nbsp;the
date of the final payment of any severance payments made pursuant to Section&nbsp;4(b)&nbsp;above,
shall be deemed to be the qualifying event for such purpose. The Company may
offset any amounts Executive owes it or its Subsidiaries against any amounts it
or its Subsidiaries owes Executive hereunder.</font></h2>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(e)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; For purposes of this
Agreement, &#147;<u>Cause</u>&#148; shall mean with respect to Executive one or more of
the following:&#160; (i)&nbsp;a material
breach of this Agreement by Executive; provided, that if such breach is capable
of being cured, Executive shall be provided 15 days notice to cure such breach,
(ii)&nbsp;a breach of Executive&#146;s duty of loyalty to the Company or any of its
Subsidiaries or any act of dishonesty or fraud with respect to the Company or
any of its Subsidiaries, (iii)&nbsp;the commission by Executive of a felony, a
crime involving moral turpitude or other act or omission causing material harm to
the standing and reputation of the Company and its Subsidiaries, (iv)&nbsp;reporting
to work under the influence of alcohol or illegal drugs, the use of illegal
drugs (whether or not at the workplace) or other repeated conduct causing the
Company or any of its Subsidiaries substantial public disgrace or disrepute or
economic harm, or (v)&nbsp;any act or omission aiding or abetting a competitor,
supplier or customer of the Company or any of its Subsidiaries to the material
disadvantage or detriment of the Company and its Subsidiaries.</font></h2>


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<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(f)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; For purposes of
this Agreement, &#147;<u>Disability</u>&#148; shall mean Executive&#146;s inability to perform
the essential duties, responsibilities and functions of his position with the
Company and its Subsidiaries as a result of any mental or physical disability
or incapacity even with reasonable accommodations of such disability or
incapacity provided by the Company and its Subsidiaries or if providing such
accommodations would be unreasonable, all as determined by the Board in its
reasonable good faith judgment. Executive shall cooperate in all respects with
the Company if a question arises as to whether he has become disabled
(including, without limitation, submitting to an examination by a medical
doctor or other health care specialists selected by the Company and authorizing
such medical doctor or such other health care specialist to discuss Executive&#146;s
condition with the Company).</font></h2>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(g)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; For purposes of this
Agreement, &#147;<u>Good Reason</u>&#148; shall mean if Executive resigns from employment
with the Company and its Subsidiaries prior to the end of the Employment Period
as a result of one or more of the following reasons:&#160; (i)&nbsp;the Company reduces the amount of
the Base Salary as set forth in paragraph 3(a)&nbsp;or the target annual bonus
opportunity payable to Executive (assuming achievement of the relevant
performance goals) as set forth in paragraph 3(c), (ii)&nbsp;the Company
changes Executive&#146;s title or reduces his responsibilities inconsistent with the
positions he holds or (iii)&nbsp;Executive and the Company are unable to agree
upon the proper reporting of any financial matter which Executive reasonably
believes is appropriate in order to comply with the rules&nbsp;and regulations
of the United States Securities and Exchange Commission or in order for the
Company&#146;s financial statements to be prepared in conformity with generally
accepted accounting principles; provided that written notice of Executive&#146;s
resignation for Good Reason must be delivered to the Company within 30 days
after the occurrence of any such event in order for Executive&#146;s resignation
with Good Reason to be effective hereunder.</font></h2>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Confidential Information</u>.</font></h1>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Obligation to
Maintain Confidentiality</u>. Executive acknowledges that the continued success
of the Company and its Subsidiaries, depends upon the use and protection of a
large body of confidential and proprietary information. All of such
confidential and proprietary information existing prior hereto, now existing or
to be developed in the future will be referred to in this Agreement as &#147;<u>Confidential
Information</u>.&#148;&#160; Confidential
Information will be interpreted as broadly as possible to include all
information of any sort (whether merely remembered or embodied in a tangible or
intangible form) that is (i)&nbsp;related to the Company&#146;s or its Subsidiaries&#146;
current or potential business and (ii)&nbsp;is not generally or publicly known.
Confidential Information includes, without specific limitation, the
information, observations and data obtained by him during the course of his
performance under this Agreement concerning the business and affairs of the
Company and its Subsidiaries, information concerning acquisition opportunities
in or reasonably related to the Company&#146;s or its Subsidiaries&#146; business or
industry of which Executive becomes aware during the Employment Period, the
persons or entities that are current, former or prospective suppliers or
customers of any one or more of them during Executive&#146;s course of performance
under this Agreement, as well as development, transition and transformation
plans, methodologies and methods of doing business, strategic, marketing and
expansion plans, including plans regarding planned and potential sales,
financial and business plans, employee lists and telephone numbers, locations
of sales representatives, new and existing </font></h2>


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<p style="margin:0pt 0pt 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">programs and services, prices and terms, customer
service, integration processes, requirements and costs of providing service,
support and equipment. Therefore, Executive agrees that he shall not disclose
to any unauthorized person or use for his own account any of such Confidential
Information without both Board&#146;s prior written consent, unless and to the
extent that any Confidential Information (i)&nbsp;becomes generally known to
and available for use by the public other than as a result of Executive&#146;s acts
or omissions to act or (ii)&nbsp;is required to be disclosed pursuant to any
applicable law or court order. Executive agrees to deliver to the Company at
the end of the Employment Period, or at any other time the Company may request
in writing, all memoranda, notes, plans, records, reports and other documents
(and copies thereof) relating to the business of the Company or its
Subsidiaries (including, without limitation, all Confidential Information) that
he may then possess or have under his control.</font></p>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Ownership of
Intellectual Property</u>. Executive agrees to make prompt and full disclosure
to the Company or its Subsidiaries, as the case may be, of all ideas,
discoveries, trade secrets, inventions, innovations, improvements,
developments, methods of doing business, processes, programs, designs,
analyses, drawings, reports, data, software, firmware, logos and all similar or
related information&#160; (whether or not
patentable and whether or not reduced to practice) that relate to the Company&#146;s
or its Subsidiaries&#146; actual or anticipated business, research and development,
or existing or future products or services and that are conceived, developed,
acquired, contributed to, made, or reduced to practice by Executive (either
solely or jointly with others) while employed by the Company or its
Subsidiaries and for a period of one (1)&nbsp;year thereafter (collectively, &#147;<u>Work
Product</u>&#148;). Any copyrightable work falling within the definition of Work
Product shall be deemed a &#147;work made for hire&#148; under the copyright laws of the
United States, and ownership of all rights therein shall vest in the Company or
its Subsidiary. To the extent that any Work Product is not deemed to be a &#147;work
made for hire,&#148; Executive hereby assigns and agrees to assign to the Company or
such Subsidiary all right, title and interest, including without limitation,
the intellectual property rights that Executive may have in and to such Work
Product. Executive shall promptly perform all actions reasonably requested by
the Board (whether during or after the Employment Period) to establish and
confirm the Company&#146;s or such Subsidiary&#146;s ownership (including, without
limitation, providing testimony and executing assignments, consents, powers of
attorney, and other instruments).</font></h2>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Third Party
Information</u>. Executive understands that the Company and its Subsidiaries
will receive from third parties confidential or proprietary information (&#147;<u>Third
Party Information</u>&#148;) subject to a duty on the Company&#146;s and its Subsidiaries&#146;
part to maintain the confidentiality of such information and to use it only for
certain limited purposes. During the Employment Period and thereafter, and
without in any way limiting the provisions of Section&nbsp;5(a)&nbsp;above,
Executive will hold Third Party Information in the strictest confidence and
will not disclose to anyone (other than personnel of the Company or its
Subsidiaries who need to know such information in connection with their work
for the Company or such Subsidiaries) or use, except in connection with his
work for the Company or its Subsidiaries, Third Party Information unless
expressly authorized by a member of the Board in writing.</font></h2>


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<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6.&#160;&#160;&#160;&#160; <u>Non-Compete, Non-Solicitation.</u></font></h1>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; In further
consideration of the compensation to be paid to Executive hereunder, Executive
acknowledges that during the course of his employment with the Company and its
Subsidiaries he shall become familiar with the Company&#146;s trade secrets and with
other Confidential Information concerning the Company and its predecessors and
its Subsidiaries and that his services shall be of special, unique and
extraordinary value to the Company and its Subsidiaries, and therefore, Executive
agrees that, during the Employment Period and for twelve months thereafter (the
&#147;<u>Noncompete Period</u>&#148;), he shall not directly or indirectly own any
interest in, manage, control, participate in, consult with, render services
for, or in any manner engage in any business competing with the businesses of
the Company or its Subsidiaries, as such businesses exist or are in process
during the Employment Period on the date of the termination or expiration of
the Employment Period, within any geographical area in which the Company or its
Subsidiaries engage or plan to engage in such businesses. Nothing herein shall
prohibit Executive from being a passive owner of not more than 2% of the
outstanding stock of any class of a corporation which is publicly traded, so
long as Executive has no active participation in the business of such
corporation.</font></h2>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; During the
Noncompete Period, Executive shall not directly or indirectly through another
person or entity (i)&nbsp;induce or attempt to induce any employee of the
Company or any Subsidiary to leave the employ of the Company or such
Subsidiary, or in any way interfere with the relationship between the Company
or any Subsidiary and any employee thereof, (ii)&nbsp;hire any person who was
an employee of the Company or any Subsidiary at any time during the Employment
Period or (iii)&nbsp;induce or attempt to induce any customer, supplier,
licensee, licensor, franchisee or other business relation of the Company or any
Subsidiary to cease doing business with the Company or such Subsidiary, or in
any way interfere with the relationship between any such customer, supplier,
licensee or business relation and the Company or any Subsidiary (including,
without limitation, making any negative or disparaging statements or
communications regarding the Company or its Subsidiaries).</font></h2>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; If, at the time of
enforcement of this paragraph 6, a court shall hold that the duration, scope or
area restrictions stated herein are unreasonable under circumstances then
existing, the parties agree that the maximum duration, scope or area reasonable
under such circumstances shall be substituted for the stated duration, scope or
area and that the court shall be allowed to revise the restrictions contained
herein to cover the maximum period, scope and area permitted by law. Executive
acknowledges that the restrictions contained in this paragraph 6 are reasonable
and that he has reviewed the provisions of this Agreement with his legal
counsel.</font></h2>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; In the event of the
breach or a threatened breach by Executive of any of the provisions of this
paragraph 6, the Company would suffer irreparable harm, and in addition and
supplementary to other rights and remedies existing in its favor, the Company
shall be entitled to specific performance and/or injunctive or other equitable
relief from a court of competent jurisdiction in order to enforce or prevent
any violations of the provisions hereof (without posting a bond or other
security). In addition, in the event of an alleged breach or violation by
Executive of this paragraph 6, the Noncompete Period shall be tolled until such
breach or violation has been</font></h2>


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<p style="margin:0pt 0pt 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">duly cured. Executive acknowledges that the
restrictions contained in paragraph 6 are reasonable and that he has reviewed
the provisions of this Agreement with his legal counsel.</font></p>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7.&#160;&#160;&#160;&#160; <u>Executive&#146;s Representations</u>. Executive
hereby represents and warrants to the Company that (i)&nbsp;the execution,
delivery and performance of this Agreement by Executive do not and shall not
conflict with, breach, violate or cause a default under any contract, agreement,
instrument, order, judgment or decree to which Executive is a party or by which
he is bound, (ii)&nbsp;Executive is not a party to or bound by any employment
agreement, noncompete agreement or confidentiality agreement with any other
person or entity and (iii)&nbsp;upon the execution and delivery of this
Agreement by the Company, this Agreement shall be the valid and binding
obligation of Executive, enforceable in accordance with its terms. Executive
hereby acknowledges and represents that he has consulted with independent legal
counsel regarding his rights and obligations under this Agreement and that he
fully understands the terms and conditions contained herein.</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8.&#160;&#160;&#160;&#160; <u>Survival</u>. Paragraphs 4 through 27
shall survive and continue in full force in accordance with their terms
notwithstanding the expiration or termination of the Employment Period.</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.&#160;&#160;&#160;&#160; <u>Notices</u>. Any notice provided for in
this Agreement shall be in writing and shall be either personally delivered,
sent by reputable overnight courier service or mailed by first class mail,
return receipt requested, to the recipient at the address below indicated:</font></h1>

<p style="margin:0pt 0pt 12.0pt;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Notices to Executive:</font></p>

<p style="margin:0pt 0pt 12.0pt 108.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">James L. Schaeffer<br>
8 Ripplemoor Lane<br>
Charleston, S.C. 29404</font></p>

<p style="margin:0pt 0pt 12.0pt 108.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">With a copy to:</font></p>

<p style="margin:0pt 0pt 12.0pt 108.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">William H. Sturges<br>
Partner<br>
Shumaker, Loop&nbsp;&amp; Kendrick, LLP<br>
128 South Tryon Street<br>
Suite&nbsp;1800<br>
Charlotte, NC&#160; 28202</font></p>

<p style="margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Notices to the Company:</font></p>

<p style="margin:0pt 0pt 12.0pt 108.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Polymer Group,&nbsp;Inc.<br>
4055 Faber Place Drive<br>
North Charleston, S.C. 29405<br>
Attn:&#160; General Counsel</font></p>


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<p style="margin:0pt 0pt 12.0pt 108.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">With a copy to:</font></p>

<p style="margin:0pt 0pt 12.0pt 108.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">H. Kurt von Moltke, P.C.<br>
Kirkland&nbsp;&amp; Ellis LLP<br>
200 East Randolph Drive<br>
Chicago, IL&#160; 60601</font></p>

<p style="margin:0pt 0pt 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">or such other address or to the attention of such
other person as the recipient party shall have specified by prior written
notice to the sending party. Any notice under this Agreement shall be deemed to
have been given when so delivered, sent or mailed.</font></p>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.&#160;&#160; <u>Severability</u>. Whenever possible, each
provision of this Agreement shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of this
Agreement is held to be invalid, illegal or unenforceable in any respect under
any applicable law or rule&nbsp;in any jurisdiction, such invalidity,
illegality or unenforceability shall not affect any other provision of this
Agreement or any action in any other jurisdiction, but this Agreement shall be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11.&#160;&#160; <u>Complete Agreement</u>. This Agreement,
those documents expressly referred to herein and other documents of even date
herewith, including the Change in Control Severance Compensation Agreement
referred to in Section&nbsp;12, embody the complete agreement and understanding
among the parties and supersede and preempt any prior understandings,
agreements or representations by or among the parties, written or oral, which
may have related to the subject matter hereof in any way.</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">12.&#160;&#160; <u>Construction with Change in Control
Severance Compensation Agreement. </u>The Company and Executive are entering
into a Change in Control Severance Compensation Agreement dated as of March&nbsp;24,
2006, concurrently with entering into this Agreement. For the avoidance of
doubt, the Change in Control Severance Compensation Agreement is to be read as
additive to this Agreement solely in the circumstances following a Change in
Control of the Company, so that the provisions of Sections 4 and Section&nbsp;6
of the Change in Control Severance Compensation Agreement are in addition to
the provisions of Sections 4 and 6 of this Agreement; <u>provided</u>, that the
amounts payable to Executive under Section&nbsp;4(a)&nbsp;of the Change in
Control Severance Agreement and the amounts payable to Executive under Section&nbsp;4(b)&nbsp;of
this Agreement shall in no event exceed the total amounts payable to Executive
under Section&nbsp;4(b)&nbsp;of this Agreement.</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.&#160;&#160; <u>No Strict Construction</u>. The language
used in this Agreement shall be deemed to be the language chosen by the parties
hereto to express their mutual intent, and no rule&nbsp;of strict construction
shall be applied against any party.</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">14.&#160;&#160; <u>Counterparts</u>. This Agreement may be
executed in separate counterparts, each of which is deemed to be an original
and all of which taken together constitute one and the same agreement.</font></h1>


 <p style="font-size:10.0pt;margin:24.0pt 0pt .0001pt;text-align:center;"><font face="Times New Roman">9</font></p> <br><hr size="3" width="100%" noshade color="#010101" align="center">

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<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">15.&#160;&#160; <u>Successors and Assigns</u>. This Agreement
is intended to bind and inure to the benefit of and be enforceable by
Executive, the Company and their respective heirs, successors and assigns,
except that Executive may not assign his rights or delegate his duties or
obligations hereunder without the prior written consent of the Company.</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">16.&#160;&#160; <u>Choice of Law</u>. All issues and
questions concerning the construction, validity, enforcement and interpretation
of this Agreement and the exhibits and schedules hereto shall be governed by,
and construed in accordance with, the laws of the State of South Carolina,
without giving effect to any choice of law or conflict of law rules&nbsp;or
provisions (whether of the State of South Carolina or any other jurisdiction)
that would cause the application of the laws of any jurisdiction other than the
State of South Carolina.</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">17.&#160;&#160; <u>Amendment and Waiver</u>. The provisions
of this Agreement may be amended or waived only with the prior written consent
of the Company (as approved by the Board) and Executive, and no course of
conduct or course of dealing or failure or delay by any party hereto in enforcing
or exercising any of the provisions of this Agreement (including, without
limitation, the Company&#146;s right to terminate the Employment Period for Cause)
shall affect the validity, binding effect or enforceability of this Agreement
or be deemed to be an implied waiver of any provision of this Agreement.</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">18.&#160;&#160; <u>Insurance</u>. The Company may, at its
discretion, apply for and procure in its own name and for its own benefit life
and/or disability insurance on Executive in any amount or amounts considered
advisable. Executive agrees to cooperate in any medical or other examination,
supply any information and execute and deliver any applications or other
instruments in writing as may be reasonably necessary to obtain and constitute
such insurance. Executive hereby represents that he has no reason to believe
that his life is not insurable at rates now prevailing for healthy men of his
age.</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">19.&#160;&#160; <u>Indemnification and Reimbursement of
Payments on Behalf of Executive</u>. The Company and its respective
Subsidiaries shall be entitled to deduct or withhold from any amounts owing
from the Company or any of its Subsidiaries to Executive any federal, state,
local or foreign withholding taxes, excise tax, or employment taxes (&#147;<u>Taxes</u>&#148;)
imposed with respect to Executive&#146;s compensation or other payments from the
Company or any of its Subsidiaries or Executive&#146;s ownership interest in the
Company (including, without limitation, wages, bonuses, dividends, the receipt
or exercise of equity options and/or the receipt or vesting of restricted equity).
In the event the Company or any of its Subsidiaries does not make such
deductions or withholdings, Executive shall indemnify the Company and its
Subsidiaries for any amounts paid with respect to any such Taxes.</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">20.&#160;&#160; <u>Waiver of Jury Trial</u>. AS A SPECIFICALLY
BARGAINED FOR INDUCEMENT FOR EACH OF THE PARTIES HERETO TO ENTER INTO THIS
AGREEMENT (AFTER HAVING THE OPPORTUNITY TO CONSULT WITH COUNSEL), EACH PARTY
HERETO EXPRESSLY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY LAWSUIT OR PROCEEDING
RELATING TO OR ARISING IN ANY WAY FROM THIS AGREEMENT OR THE MATTERS
CONTEMPLATED HEREBY.</font></h1>


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<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">21.&#160;&#160; <u>Executive&#146;s Cooperation</u>. During the
Employment and thereafter, Executive shall cooperate with the Company and its
Subsidiaries in any internal investigation or administrative, regulatory or
judicial proceeding as reasonably requested by the Company (including, without
limitation, Executive being available to the Company upon reasonable notice for
interviews and factual investigations, appearing at the Company&#146;s request to
give testimony without requiring service of a subpoena or other legal process,
volunteering to the Company all pertinent information and turning over to the
Company all relevant documents which are or may come into Executive&#146;s
possession, all at times and on schedules that are reasonably consistent with
Executive&#146;s other permitted activities and commitments). In the event the
Company requires Executive&#146;s cooperation in accordance with this paragraph, the
Company shall reimburse Executive solely for reasonable travel expenses
(including lodging and meals, upon submission of receipts).</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">22.&#160;&#160; <u>Arbitration</u>. Except with respect to
disputes or claims under paragraphs 5 and 6 hereof (which may be pursued in any
court of competent jurisdiction as specified below and with respect to which
each party shall bear the cost of its own attorney&#146;s fees and expenses except
as otherwise required by applicable law), each party hereto agrees that the
arbitration procedure set forth in Exhibit&nbsp;B hereto shall be the sole and
exclusive method for resolving any claim or dispute (&#147;Claim&#148;) arising out of or
relating to the rights and obligations acknowledged and agreed to in this
Agreement and the employment of Executive by the Company and its Subsidiaries
(including, without limitation, disputes and claims regarding employment
discrimination, sexual harassment, termination and discharge), whether such
Claim arose or the facts on which such Claim is based occurred prior to or
after the execution and delivery of adoption of this Agreement. The parties
agree that the result of any arbitration hereunder shall be final, conclusive
and binding on all of the parties. Nothing in this paragraph shall prohibit a
party hereto from instituting litigation to enforce any Final Determination (as
defined in <u>Exhibit&nbsp;B</u> hereto). Each party hereto hereby irrevocably
submits to the jurisdiction of any United States District Court or South
Carolina state court of competent jurisdiction sitting in Charleston County,
South Carolina, and agrees that such court shall be the exclusive forum with
respect to disputes and claims under paragraphs 5 and 6 and for the enforcement
of any Final Determination, and irrevocably and unconditionally waives (i)&nbsp;any
objection to the laying of venue of any such action, suit or proceeding in such
court or (ii)&nbsp;any argument, claim, defense or allegation that any such
action, suit or proceeding brought in such court has been brought in an
inconvenient forum. Each party hereto irrevocably consents to service of
process by registered mail or personal service and waives any objection on the
grounds of personal jurisdiction, venue or inconvenience of the forum.</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">23.&#160;&#160; <u>Section&nbsp;and Headings</u>. The
division of this Agreement into sections and the insertion of headings are for
the convenience of reference only and shall not affect the construction or
interpretation of this Agreement. The terms &#147;this Agreement&#148;, &#147;hereof&#148;, &#147;hereunder&#148;
and similar expressions refer to this Agreement and not to any particular
section or other portion hereof. Unless something in the subject matter or
context is inconsistent therewith, references to sections and clauses are to
sections and clauses of this Agreement.</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">24.&#160;&#160; <u>Number</u>. In this Agreement, words
importing the singular number only shall include the plural and vice versa, and
words importing the masculine gender shall include</font></h1>


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<p style="margin:0pt 0pt 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">the feminine and neuter genders and vice versa, and
words importing persons shall include individuals, partnerships, associations,
trusts, unincorporated organizations and corporations.</font></p>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">25.&#160;&#160; <u>Independent Advice</u>. The Company and
the Executive acknowledge and agree that they have each obtained independent
legal advice in connection with this Agreement and they further acknowledge and
agree that they have read, understand and agree with all of the terms hereof
and that they are executing this Agreement voluntarily and in good faith.</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">26.&#160;&#160; <u>Copy of Agreement</u>. The Executive
hereby acknowledges receipt of a copy of this Agreement duly signed by the
Company.</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">27.&#160;&#160; <u>Termination Prior to Effective Date</u>. In
the event of a termination of employment of the Executive prior to the
Effective Date, this Agreement shall be terminated and shall have no further
force or effect.</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">28.&#160;&#160; <u>Currency</u>. All dollar amounts set forth
or referred to in this Agreement refer to U.S. currency.</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">29.&#160;&#160; <u>Effectiveness</u>. Once this Agreement has
been duly executed and delivered by each party hereto, all of the provisions
shall become effective as of April&nbsp;1, 2006, as if this Agreement had been
entered into at such time, including the compensation provisions contained in Section&nbsp;3.</font></h1>

<p align="center" style="margin:0pt 0pt 12.0pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;&#160;&#160; *&#160;&#160;&#160;
*&#160;&#160;&#160; *&#160;&#160;&#160; *</font></p>


 <p style="font-size:10.0pt;margin:24.0pt 0pt .0001pt;text-align:center;"><font face="Times New Roman">12</font></p> <br><hr size="3" width="100%" noshade color="#010101" align="center">

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<p style="margin:0pt 0pt 12.0pt;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">IN WITNESS WHEREOF, the parties hereto have executed
this Agreement as of the date first written above.</font></p>

<p style="margin:0pt 0pt 12.0pt 216.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Polymer
Group,&nbsp;Inc.</font></p>

<p style="margin:0pt 0pt 12.0pt 216.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By:&#160;&#160;&#160;&#160;&#160; <u>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </u></font></p>

<p style="margin:0pt 0pt 12.0pt 216.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Its:&#160;&#160;&#160;&#160;&#160; <u>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </u></font></p>

<p style="margin:0pt 0pt 12.0pt 216.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0pt 0pt 12.0pt 216.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0pt 0pt 12.0pt 216.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">__________________________________________________</font></p>

<p style="margin:0pt 0pt 12.0pt 216.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">James L. Schaeffer</font></p>


 <p style="font-size:10.0pt;margin:24.0pt 0pt .0001pt;text-align:center;"><font face="Times New Roman">13</font></p>
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<div>
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<p align="right" style="margin:0pt 0pt 12.0pt;text-align:right;"><u><font size="2" face="Times New Roman" style="font-size:10.0pt;">Exhibit&nbsp;A</font></u></p>

<p style="margin:0pt 0pt 12.0pt;page-break-after:avoid;text-align:center;text-decoration:underline;"><u><font size="2" face="Times New Roman" style="font-size:10.0pt;">GENERAL RELEASE</font></u></p>

<p style="margin:0pt 0pt 12.0pt;text-indent:36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">I, James L. Schaeffer, in&#160; consideration of and subject to the
performance by Polymer Group,&nbsp;Inc., a Delaware corporation (together with
its subsidiaries, the &#147;Company&#148;), of its obligations under the Employment
Agreement, entered into on March&nbsp;24, 2006, (the &#147;<u>Agreement</u>&#148;), do
hereby release and forever discharge as of the date hereof the Company and its
affiliates and all present and former directors, officers, agents,
representatives, employees, successors and assigns of the Company and its
affiliates and the Company&#146;s direct or indirect owners (collectively, the &#147;<u>Released
Parties</u>&#148;) to the extent provided below.</font></p>

<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>I
understand that any payments or benefits paid or granted to me under paragraph
4(b)&nbsp;of the Agreement represent, in part, consideration for signing this
General Release and are not salary, wages or benefits to which I was already
entitled. I understand and agree that I will not receive the payments and
benefits specified in paragraph 4(b)&nbsp;of the Agreement unless I execute
this General Release and do not revoke this General Release within the time
period permitted hereafter or breach this General Release. Such payments and
benefits will not be considered compensation for purposes of any employee
benefit plan, program, policy or arrangement maintained or hereafter
established by the Company or its affiliates. I also acknowledge and represent
that I have received all payments and benefits that I am entitled to receive
(as of the date hereof) by virtue of any employment by the Company.</p>

<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Except
as provided in paragraph 4 below and except for the provisions of my Employment
Agreement which expressly survive the termination of my employment with the
Company, I knowingly and voluntarily (for myself, my heirs, executors,
administrators and assigns) release and forever discharge the Company and the
other Released Parties from any and all claims, suits, controversies, actions,
causes of action, cross-claims, counter-claims, demands, debts, compensatory
damages, liquidated damages, punitive or exemplary damages, other damages,
claims for costs and attorneys&#146; fees, or liabilities of any nature whatsoever
in law and in equity, existing or hereafter arising, based in whole or in part
upon any act or omission, transaction, agreement, event or other occurrence
taking place from the beginning of time through the date this General Release
becomes effective and enforceable and whether known or unknown, suspected, or
claimed against the Company or any of the Released Parties which I, my spouse,
or any of my heirs, executors, administrators or assigns, may have, which arise
out of or are connected with my employment with, or my separation or
termination from, the Company (including, but not limited to, any allegation,
claim or violation, arising under: Title VII of the Civil Rights Act of 1964,
as amended; the Civil Rights Act of 1991; the Age Discrimination in Employment
Act of 1967, as amended (including the Older Workers Benefit Protection Act);
the Equal Pay Act of 1963, as amended; the Americans with Disabilities Act of
1990; the Family and Medical Leave Act of 1993; the Worker Adjustment
Retraining and Notification Act; the Employee Retirement Income Security Act of
1974; any applicable Executive Order Programs; the Fair Labor Standards Act; or
their state or local counterparts; the South Carolina Human Affairs Law, S.C.
Code</p>


 <p style="font-size:10.0pt;margin:24.0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">ExA-</font><font face="Times New Roman">1</font></p> <br><hr size="3" width="100%" noshade color="#010101" align="center">

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<p style="margin:0pt 0pt 12.0pt 36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">sections 1-13-10
et seq.; S.C. Code sections 41-10-10 et seq. or under any other
federal, state or local civil or human rights law, or under any other local,
state, or federal law, regulation or ordinance; or under any public policy,
contract or tort, or under common law; or arising under any policies, practices
or procedures of the Company; or any claim for wrongful discharge, breach of
contract, infliction of emotional distress, defamation; or any claim for costs,
fees, or other expenses, including attorneys&#146; fees incurred in these matters)
(all of the foregoing collectively referred to herein as the &#147;<u>Claims</u>&#148;).</font></p>

<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>I
represent that I have made no assignment or transfer of any right, claim,
demand, cause of action, or other matter covered by paragraph 2 above.</p>

<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>I
agree that this General Release does not waive or release any rights or claims
that I may have under the Age Discrimination in Employment Act of 1967 which
arise after the date I execute this General Release. I acknowledge and agree
that my separation from employment with the Company in compliance with the
terms of the Agreement shall not serve as the basis for any claim or action
(including, without limitation, any claim under the Age Discrimination in
Employment Act of 1967).</p>

<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>In
signing this General Release, I acknowledge and intend that it shall be
effective as a bar to each and every one of the Claims hereinabove mentioned or
implied. I expressly consent that this General Release shall be given full
force and effect according to each and all of its express terms and provisions,
including those relating to unknown and unsuspected Claims (notwithstanding any
state statute that expressly limits the effectiveness of a general release of
unknown, unsuspected and unanticipated Claims), if any, as well as those
relating to any other Claims hereinabove mentioned or implied. I acknowledge
and agree that this waiver is an essential and material term of this General
Release and that without such waiver the Company would not have agreed to the
terms of the Agreement. I further agree that in the event I should bring a
Claim seeking damages against the Company, or in the event I should seek to
recover against the Company in any Claim brought by a governmental agency on my
behalf, this General Release shall serve as a complete defense to such Claims.
I further agree that I am not aware of any pending charge or complaint of the
type described in paragraph 2 as of the execution of this General Release.</p>

<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>I
agree that neither this General Release, nor the furnishing of the
consideration for this General Release, shall be deemed or construed at any
time to be an admission by the Company, any Released Party or myself of any
improper or unlawful conduct.</p>

<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>I
agree that I will forfeit all amounts payable by the Company pursuant to the
Agreement if I challenge the validity of this General Release. I also agree
that if I violate this General Release by suing the Company or the other Released
Parties, I will pay all costs and expenses of defending against the suit
incurred by the Released Parties, including reasonable attorneys&#146; fees, and
return all payments received by me pursuant to the Agreement.</p>


 <p style="font-size:10.0pt;margin:24.0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">ExA-</font><font face="Times New Roman">2</font></p> <br><hr size="3" width="100%" noshade color="#010101" align="center">

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<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>I
agree that this General Release is confidential and agree not to disclose any
information regarding the terms of this General Release, except to my immediate
family and any tax, legal or other counsel I have consulted regarding the
meaning or effect hereof or as required by law, and I will instruct each of the
foregoing not to disclose the same to anyone.</p>

<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Any
non-disclosure provision in this General Release does not prohibit or restrict
me (or my attorney) from responding to any inquiry about this General Release
or its underlying facts and circumstances by the Securities and Exchange
Commission (SEC), the National Association of Securities Dealers,&nbsp;Inc.
(NASD), any other self-regulatory organization or governmental entity.</p>

<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>I
agree to reasonably cooperate with the Company in any internal investigation or
administrative, regulatory, or judicial proceeding. I understand and agree that
my cooperation may include, but not be limited to, making myself available to
the Company upon reasonable notice for interviews and factual investigations;
appearing at the Company&#146;s request to give testimony without requiring service
of a subpoena or other legal process; volunteering to the Company pertinent
information; and turning over to the Company all relevant documents which are
or may come into my possession all at times and on schedules that are
reasonably consistent with my other permitted activities and commitments. I
understand that in the event the Company asks for my cooperation in accordance
with this provision, the Company will reimburse me solely for reasonable travel
expenses, including lodging and meals, upon my submission of receipts.</p>

<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>I
agree not to disparage the Company, its past and present investors, officers,
directors or employees or its affiliates and to keep all confidential and proprietary
information about the past or present business affairs of the Company and its
affiliates confidential unless a prior written release from the Company is
obtained. I further agree that as of the date hereof, I have returned to the
Company any and all property, tangible or intangible, relating to its business,
which I possessed or had control over at any time (including, but not limited
to, company-provided credit cards, building or office access cards, keys,
computer equipment, manuals, files, documents, records, software, customer data
base and other data) and that I shall not retain any copies, compilations,
extracts, excerpts, summaries or other notes of any such manuals, files,
documents, records, software, customer data base or other data.</p>

<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">12.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Notwithstanding
anything in this General Release to the contrary, this General Release shall
not relinquish, diminish, or in any way affect any rights or claims arising out
of any breach by the Company or by any Released Party of the Agreement after
the date hereof.</p>

<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Whenever
possible, each provision of this General Release shall be interpreted in, such
manner as to be effective and valid under applicable law, but if any provision
of this General Release is held to be invalid, illegal or unenforceable in any
respect under any applicable law or rule&nbsp;in any jurisdiction, such
invalidity, illegality or unenforceability shall not affect any other provision
or any other jurisdiction, but this General Release</p>


 <p style="font-size:10.0pt;margin:24.0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">ExA-</font><font face="Times New Roman">3</font></p> <br><hr size="3" width="100%" noshade color="#010101" align="center">

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<p style="margin:0pt 0pt 12.0pt 36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">shall be reformed,
construed and enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision had never been contained herein.</font></p>

<p style="margin:0pt 0pt 12.0pt;page-break-after:avoid;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">BY SIGNING THIS GENERAL RELEASE, I REPRESENT AND AGREE
THAT:</font></p>

<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>I
HAVE READ IT CAREFULLY;</p>

<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>I
UNDERSTAND ALL OF ITS TERMS AND KNOW THAT I AM GIVING UP IMPORTANT RIGHTS,
INCLUDING BUT NOT LIMITED TO, RIGHTS UNDER THE AGE DISCRIMINATION IN EMPLOYMENT
ACT OF 1967, AS AMENDED, TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, AS AMENDED;
THE EQUAL PAY ACT OF 1963, THE AMERICANS WITH DISABILITIES ACT OF 1990; AND THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED;</p>

<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>I
VOLUNTARILY CONSENT TO EVERYTHING IN IT;</p>

<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>I
HAVE BEEN ADVISED TO CONSULT WITH AN ATTORNEY BEFORE EXECUTING IT AND I HAVE
DONE SO OR, AFTER CAREFUL READING AND CONSIDERATION I HAVE CHOSEN NOT TO DO SO
OF MY OWN VOLITION;</p>

<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(e)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>I
HAVE HAD AT LEAST 21 DAYS FROM THE DATE OF MY RECEIPT OF THIS RELEASE
SUBSTANTIALLY IN ITS FINAL FORM&nbsp;ON &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;, &nbsp;&nbsp;&nbsp;&nbsp; TO CONSIDER IT AND THE CHANGES MADE
SINCE THE &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;, &nbsp;&nbsp;&nbsp;&nbsp; VERSION OF THIS RELEASE ARE NOT MATERIAL
AND WILL NOT RESTART THE REQUIRED 21-DAY PERIOD;</p>

<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(f)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>THE
CHANGES TO THE AGREEMENT SINCE &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;, &nbsp;&nbsp;&nbsp;&nbsp; EITHER ARE NOT MATERIAL OR WERE MADE AT
MY REQUEST.</p>

<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(g)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>I
UNDERSTAND THAT I HAVE SEVEN DAYS AFTER THE EXECUTION OF THIS RELEASE TO REVOKE
IT AND THAT THIS RELEASE SHALL NOT BECOME EFFECTIVE OR ENFORCEABLE UNTIL THE
REVOCATION PERIOD HAS EXPIRED;</p>

<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(h)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>I
HAVE SIGNED THIS GENERAL RELEASE KNOWINGLY AND VOLUNTARILY AND WITH THE ADVICE
OF ANY COUNSEL RETAINED TO ADVISE ME WITH RESPECT TO IT; AND</p>

<p style="font-family:Times New Roman;font-size:10.0pt;margin:0pt 0pt 12.0pt 36.0pt;text-indent:-36.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>I
AGREE THAT THE PROVISIONS OF THIS GENERAL RELEASE MAY&nbsp;NOT BE AMENDED,
WAIVED, CHANGED OR MODIFIED EXCEPT BY AN INSTRUMENT IN WRITING SIGNED BY AN
AUTHORIZED REPRESENTATIVE OF THE COMPANY AND BY ME.</p>

<p style="margin:0pt 0pt 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">DATE:&#160; &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; ____________________________________</font></p>


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<p align="right" style="margin:0pt 0pt 12.0pt;text-align:right;"><u><font size="2" face="Times New Roman" style="font-size:10.0pt;">Exhibit&nbsp;B</font></u></p>

<p style="margin:0pt 0pt 12.0pt;page-break-after:avoid;text-align:center;text-decoration:underline;"><u><font size="2" face="Times New Roman" style="font-size:10.0pt;">ARBITRATION PROCEDURE</font></u></p>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Notice of Claim</u>. A party asserting a Claim (the &#147;<u>Claimant</u>&#148;)
shall deliver written notice to each party against whom the Claim is asserted
(collectively, the &#147;<u>Opposing Party</u>&#148;), with a copy to the persons
required to receive copies of notices under the Agreement (the &#147;<u>Additional
Notice Parties</u>&#148;), specifying the nature of the Claim and requesting a
meeting to resolve same. The Additional Notice Parties shall be given
reasonable notice of and invited and permitted to attend any such meeting. If
no resolution is reached within 10 business days after delivery of such notice,
the Claimant or the Opposing Party may, within 45 days after giving such
notice, invoke the arbitration procedure provided herein by delivering to each
Opposing Party and the Additional Notice Parties a notice of arbitration which
shall specify the Claim as to which arbitration is sought, the nature of the
Claim, the basis for the Claim and the nature and amount of any damages or
other compensation or relief sought (a &#147;<u>Notice of Arbitration</u>&#148;). Each
party agrees that no punitive damages may be sought or recovered in any
arbitration, judicial proceeding or otherwise. Failure to file a Notice of
Arbitration within 45 days shall constitute a waiver of any right to relief for
the matters asserted in the notice of Claim. Any Claim shall be forever barred,
and no relief may be sought therefor, if written notice of such Claim is not
made as provided above within one year of the date such Claim accrues.</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Selection of Arbitrator</u>. Within 20 business days
after receipt of the Notice of Arbitration, the Executive and a duly authorized
representative of the Company shall confer, whether in person, by telephone or
in writing, and attempt to agree on an arbitrator to hear and decide the Claim.
If the Executive and the Board cannot agree on an arbitrator within ten
business days, then they shall request the American Arbitration Association
(the &#147;<u>AAA</u>&#148;) in Charleston, South Carolina to appoint an arbitrator
experienced in the area of dispute who does not have an ongoing business
relationship with any of the parties to the dispute. If the arbitrator selected
informs the parties he cannot hear and resolve the Claim within the time-frame
specified below, the Executive and the Board shall request the appointment of
another arbitrator by the AAA subject to the same requirements.</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Arbitration Procedure</u>. The following procedures
shall govern the conduct of any arbitration under this section. All procedural
matters relating to the conduct of the arbitration other than those specified
below shall be discussed among counsel for the parties and the arbitrator. Subject
to any agreement of the parties, the arbitrator shall determine all procedural
matters not specified herein.</font></h1>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; Within 30 days after
the delivery of a Notice of Arbitration, each party shall afford the other, or
its counsel, with reasonable access to documents relating directly to the
issues raised in the Notice of Arbitration. All documents produced and all
copies thereof shall be maintained as strictly confidential, shall be used for
no purpose other than the arbitration hereunder, and shall be returned to the
producing party upon completion of the arbitration. There shall be no other
discovery except that, if a reasonable need is shown, limited depositions may
be allowed in the discretion of the arbitrator, it being the expressed
intention and agreement of each</font></h2>


 <p style="font-size:10.0pt;margin:24.0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">ExB-</font><font face="Times New Roman">1</font></p> <br><hr size="3" width="100%" noshade color="#010101" align="center">

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<p style="margin:0pt 0pt 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">party to have the arbitration proceedings conducted
and resolved as expeditiously, economically and fairly as reasonably
practicable, and with the maximum degree of confidentiality.</font></p>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; All written
communications regarding the proceeding sent to the arbitrator shall be sent
simultaneously to each party or its counsel, with a copy to the Additional
Notice Parties. Oral communications between any of the parties or their counsel
and the arbitrator shall be conducted only when all parties or their counsel
are present and participating in the conversation.</font></h2>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; Within 20 days after
selection of the arbitrator, the Claimant shall submit to the arbitrator a copy
of the Notice of Arbitration, along with a supporting memorandum and any
exhibits or other documents supporting the Claim.</font></h2>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; Within 20 days after
receipt of the Claimant&#146;s submission, the Opposing Party shall submit to the
arbitrator a memorandum supporting its position and any exhibits or other
supporting documents. If the Opposing Party fails to respond to any of the
issues raised by the Claimant within 20 days of receipt of the Claimant&#146;s
submission, then the arbitrator may find for the Claimant on any such issue and
bar any subsequent consideration of the matter.</font></h2>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(e)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; Within 20 days after
receipt of the Opposing Party&#146;s response, the Claimant may submit to the
arbitrator a reply to the Opposing Party&#146;s response, or notification that no
reply is forthcoming.</font></h2>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(f)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; Within 10 days
after the last submission as provided above, the arbitrator shall confer with
the parties to select the date of the hearing on the issues raised by the Claim.
Scheduling of the hearing shall be within the sole discretion of the
arbitrator, but in no event more than 30 days after the last submission by the
parties, and shall take place within 50 miles of the corporate headquarters of
the Company at a place selected by the arbitrator or such other place as is
mutually agreed. Both parties shall be granted substantially equal time to
present evidence at the hearing. The hearing shall not exceed one business day,
except for good cause shown.</font></h2>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(g)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; Within 30 days after
the conclusion of the hearing, the arbitrator shall issue a written decision to
be delivered to both parties and the Additional Notice Parties (the &#147;Final
Determination&#148;). The Final Determination shall address each issue disputed by
the parties, state the arbitrator&#146;s findings and reasons therefor, and state
the nature and amount of any damages, compensation or other relief awarded.</font></h2>

<h2 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(h)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; The award rendered
by the arbitrator shall be final and non-appealable, except as otherwise
provided under the Federal Arbitration Act, and judgment may be entered upon it
in accordance with applicable law in such court as has jurisdiction thereof.</font></h2>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Costs of Arbitration</u>. Each party shall bear its
own costs of conducting the arbitration, and administrative fees shall be
shared equally among the parties.</font></h1>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Satisfaction of Award</u>. If any party fails to pay
the amount of the award, if any, assessed against it within 30 days after the
delivery to such party of the Final Determination,</font></h1>


 <p style="font-size:10.0pt;margin:24.0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">ExB-</font><font face="Times New Roman">2</font></p> <br><hr size="3" width="100%" noshade color="#010101" align="center">

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<p style="margin:0pt 0pt 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">the unpaid amount shall bear interest from the date of
such delivery at the lesser of (i)&nbsp;prime lending rate announced by
Citibank N.A. plus three hundred basis points and (ii)&nbsp;the maximum rate
permitted by applicable usury laws. In addition, such party shall promptly
reimburse the other party for any and all costs or expenses of any nature or
kind whatsoever (including attorneys&#146; fees) reasonably incurred in seeking to
collect such award or to enforce any Final Determination.</font></p>

<h1 style="font-weight:normal;margin:0pt 0pt 12.0pt;page-break-after:avoid;text-indent:72.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Confidentiality of Proceedings</u>. The parties
hereto agree that all of the arbitration proceedings provided for herein,
including any notice of claim, the Notice of Arbitration, the submissions of
the parties, and the Final Determination issued by the arbitrator, shall be
confidential and shall not be disclosed at any time to any person other than
the parties, their representatives, the arbitrator and the Additional Notice
Parties; provided, however, that this provision shall not prevent the party
prevailing in the arbitration from submitting the Final Determination to a
court for the purpose of enforcing the award, subject to comparable
confidentiality protections if the court agrees; and further provided that the
foregoing shall not prohibit disclosure to the minimum extent reasonably
necessary to comply with (i)&nbsp;applicable law (or requirement having the
force of law), court order, judgment or decree, including, without limitation,
disclosures which may be required pursuant to applicable securities laws, and (ii)&nbsp;the
terms of contractual arrangements (such as financing arrangements) to which the
Company or any Additional Notice Party may be subject so long as such
contractual arrangements were not entered into for the primary purpose of
permitting disclosure which would otherwise be prohibited hereunder.</font></h1>


 <p style="font-size:10.0pt;margin:24.0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">ExB-</font><font face="Times New Roman">3</font></p>
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