9335 Harris Corners Parkway, Suite 300
Charlotte, North Carolina 28269
(704) 697-5100
(Address, including zip code, and telephone number, including area code, of registrants’ principal executive offices)

Daniel L. Rikard
Senior Vice President, General Counsel and Secretary
Polymer Group, Inc.
9335 Harris Corners Parkway, Suite 300
Charlotte, North Carolina 28269
(704) 697-5100
(Name, address, including zip code, and telephone number, including area code, of agent for service)

With a copy to:
Igor Fert
Simpson Thacher & Bartlett LLP
425 Lexington Avenue
New York, New York 10017-3954
(212) 455-2000

           Approximate date of commencement of proposed exchange offer: As soon as practicable after this Registration Statement is declared effective.

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

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

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

          Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a small reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

          If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:

Exchange Act Rule 13e-4(i) (Cross Border Issuer Tender Offer) o Exchange Act Rule 14d-1(d) (Cross Border Third Party Tender Offer) o

TABLE OF ADDITIONAL REGISTRANT GUARANTORS

										Address, including Zip
Exact Name of Registrant		State or Other		I.R.S.						Code and Telephone
Guarantor as Specified in its		Jurisdiction of		Employer		Industrial				Number, including Area
Charter (or Other		Incorporation or		Identification		Classification				Code, of Registrant’s
Organizational Document)		Organization		Number		Code Number				Principal Executive Offices
Chicopee, Inc.		Delaware		57-1013629			2221			9335 Harris Corners Parkway Suite 300 Charlotte, NC 28269 (704) 697-5100
Dominion Textile (USA), L.L.C.		Delaware		13-2865428			2200			9335 Harris Corners Parkway Suite 300 Charlotte, NC 28269 (704) 697-5100
Fabrene, L.L.C.		Delaware		51-0319685			2221			9335 Harris Corners Parkway Suite 300 Charlotte, NC 28269 (704) 697-5100
PGI Europe, Inc.		Delaware		56-2154891			2221			9335 Harris Corners Parkway Suite 300 Charlotte, NC 28269 (704) 697-5100
PGI Polymer, Inc.		Delaware		57-0962088			2221			9335 Harris Corners Parkway Suite 300 Charlotte, NC 28269 (704) 697-5100

PRELIMINARY PROSPECTUS

Polymer Group, Inc.
Offers to Exchange

           $560,000,000 aggregate principal amount of 7.75% Senior Secured Notes due 2019 (the “exchange notes”), which have been registered under the Securities Act of 1933, as amended (the “Securities Act”), for any and all outstanding 7.75% Senior Secured Notes due 2019 (the “outstanding notes”, and together with the exchange notes, the “notes”).

           The exchange notes will be fully and unconditionally guaranteed on a senior secured basis by our existing and future wholly-owned domestic subsidiaries that guarantee our existing senior secured asset-based revolving credit facility and the outstanding notes.

           We are conducting the exchange offer in order to provide you with an opportunity to exchange your unregistered outstanding notes for freely tradeable exchange notes that have been registered under the Securities Act.

           You should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with different information. This prospectus may be used only for the purposes for which it has been published and no person has been authorized to give any information not contained herein. If you receive any other information, you should not rely on it. We are not making an offer of these securities in any state where the offer is not permitted.

FORWARD LOOKING STATEMENTS

          This prospectus includes forward-looking statements regarding, among other things, our plans, strategies and prospects, both business and financial. These statements are based on the beliefs and assumptions of our management. These forward-looking statements speak only as of the date of this prospectus. Unless required by law, we do not undertake any obligation to update these statements and caution against any undue reliance on them. These forward-looking statements are based on current expectations and assumptions about future events. Although management considers these expectations and assumptions to be reasonable, they are inherently subject to significant business, economic, competitive, regulatory and other risks, contingencies and uncertainties, most of which are difficult to predict and many of which are beyond our control. Generally, statements that are not historical facts, including statements concerning our possible or assumed future actions, business strategies, events or results of operations, are forward-looking statements. These statements may be preceded by, followed by or include the words “believes,” “estimates,” “expects,” “projects,” “forecasts,” “may,” “will,” “should,” “seeks,” “plans,” “scheduled,” “anticipates,” “targets” or “intends” or similar expressions.

          Forward-looking statements are not guarantees of performance. You should not put undue reliance on these statements which speak only as of the date hereof. You should understand that the following important factors, in addition to those discussed in “Risk Factors” and elsewhere in this prospectus, could affect our future results and could cause those results or other outcomes to differ materially from those expressed or implied in our forward-looking statements:

	•		general economic factors including, but not limited to, changes in interest rates, foreign currency translation rates, consumer confidence, trends in disposable income, changes in consumer demand for goods produced, and cyclical or other downturns;
	•		cost and availability of raw materials, labor and natural and other resources, and our ability to pass raw material cost increases along to customers;
	•		changes to selling prices to customers which are based, by contract, on an underlying raw material index;
	•		substantial debt levels and potential inability to maintain sufficient liquidity to finance our operations and make necessary capital expenditures;
	•		ability to meet existing debt covenants or obtain necessary waivers;
	•		achievement of objectives for strategic acquisitions and dispositions;
	•		ability to achieve successful or timely start-up of new or modified production lines;
	•		reliance on major customers and suppliers;
	•		domestic and foreign competition;
	•		information and technological advances;
	•		risks related to operations in foreign jurisdictions;
	•		changes in environmental laws and regulations, including climate change-related legislation and regulation;
	•		uncertainty regarding the effects of the Transactions; and

•

the outcome of discussions with the Internal Revenue Service regarding the potential payments due associated with the personal holding company tax issue discussed herein.

          The risks described in the “Risk Factors” section in this prospectus are not exhaustive. Other sections of this prospectus describe additional factors that could adversely affect our business, financial condition or results of operations. New risk factors emerge from time to time and it is not possible for us to predict all such risk factors, nor can we assess the impact of all such risk factors on our business or the extent to which any factor or combination of factors may cause actual results to differ materially from those contained in any forward-looking statements. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the foregoing cautionary statements. We undertake no obligations to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

MARKET, RANKING AND OTHER INDUSTRY DATA

          The data included in this prospectus regarding the markets and the industry in which we operate, including the size of certain markets and our position and the position of our competitors within these markets, are based on reports of government agencies, independent industry sources and our own estimates relying on our management’s knowledge and experience in the markets in which we operate. Our management’s knowledge and experience, in turn, are based on information obtained from our customers, distributors, suppliers, trade and business organizations and other contacts in the markets in which we operate. We believe these estimates to be accurate as of the date of this prospectus. However, this information may prove to be inaccurate because of the method by which we obtained some of the data for our estimates or because this information cannot always be verified with complete certainty due to the limits on the availability and reliability of raw data, the voluntary nature of the data gathering process and other limitations and uncertainties.

          In this prospectus, we refer to certain information regarding the nonwovens industry and demand for nonwovens in hygiene, medical, wipes and industrial applications. Some of this information is based upon a report prepared by Arthur D. Little, Inc., a management consulting company (“ADL Consulting”), specifically for the Sponsor (as defined below) in relation to the Transactions (described below). The information and conclusions in ADL Consulting’s report constitute ADL Consulting’s best professional opinion and are based upon ADL Consulting’s technical and business knowledge of the chemicals industry and the information available to ADL Consulting. While the report was based in part on information obtained from sources considered to be reliable, there can be no assurance that the information upon which the report was based was complete or accurate. ADL Consulting’s professional opinion should not and may not be construed as an investment recommendation to any party. ADL Consulting is a leading independent global management consultancy with a developed chemicals practice. ADL Consulting is not affiliated with us or the Sponsor, but has received a customary fee in connection with their engagement. We have agreed to indemnify ADL consulting against certain liabilities arising out of certain information based upon a report prepared by ADL Consulting. ADL Consulting has performed services for the Sponsor from time to time for which they have received customary fees. ADL Consulting may, from time to time, perform services for us or the Sponsor in the ordinary course of their business, for which they may receive customary fees.

          Although we believe market, ranking and other industry data included in this prospectus is generally reliable, it is inherently imprecise. We cannot guarantee the accuracy and completeness of the information and have not independently verified it, nor have we ascertained the underlying assumptions relied upon therein. As a result, you should be aware that market, ranking and other industry data included in this prospectus, and our estimates and beliefs based on that data, may not be reliable, and that we cannot guarantee the accuracy or completeness of any such information contained in this prospectus. While we are not aware of any misstatements regarding the industry data presented herein, our estimates involve risks and uncertainties and are subject to change based on various factors, including those discussed under the heading “Risk Factors” in this prospectus.

TRADEMARKS

          This prospectus contains some of our trademarks, trade names and service marks, including the following: APEX, Chix, PGI, Polymer Group, Inc., and Spinlace. Each one of these trademarks, trade names or service marks

is either (i) our registered trademark, (ii) a trademark for which we have a pending application, (iii) a trade name or service mark for which we claim common law rights or (iv) a registered trademark or application for registration which we have been licensed by a third party to use. All other trademarks, trade names or service marks of any other organization appearing in this prospectus belong to their respective owners.

BASIS OF PRESENTATION

          As used in this prospectus, unless otherwise noted or the context otherwise requires, (i) references to the “Issuer” or “Polymer Group” are to Polymer Group, Inc., exclusive of its subsidiaries; (ii) references to “we”, “us”, “our”, “PGI” and the “Company” are to Polymer Group, Inc. and its subsidiaries; (iii) references to “Holdings” are to Scorpio Holdings Corporation, exclusive of its subsidiaries; (iv) references to “Parent” are to Scorpio Acquisition Corporation, exclusive of its subsidiaries; (v) references to “Blackstone” and the “Sponsor” are to certain investment funds affiliated with Blackstone Capital Partners V L.P.; (vi) references to the “Investor Group” are, collectively, to Blackstone and the management investors (as defined below); (vii) references to the “management investors” are to certain members of our management team and employees who agreed to make investments in Holdings; (viii) references to “PGI Spain” are to PGI Spain S.L., our wholly-owned subsidiary in Spain; (ix) references to “Nanhai Nanxin” are to our Chinese subsidiary Nanhai Nanxin Non-Woven Co., Ltd; (x) references to the “China Noncontrolling Interest Acquisition” are to our acquisition in first quarter 2011 of the 20% noncontrolling ownership interest in Nanhai Nanxin; (xi) references to “Tesalca-Texnovo” are to Tesalca-99, S.A. and Texnovo, S.A.; (xii) references to the “Spain Business Acquisition” are to our acquisition of certain assets and operations of the nonwovens businesses of Tesalca-Texnovo pursuant to that certain Asset Transfer Agreement, dated October 30, 2009, as amended on November 30, 2009; (xiii) references to the “Argentina Noncontrolling Interest Acquisition” are to our acquisition of the 40% noncontrolling ownership interest in our Argentina business, Dominion Nonwovens Sudamericana, S.A. in the fourth quarter of 2009; (xiv) references to the “Fabpro” or the “FabPro business” are to Fabpro Oriented Polymers, LLC; (xv) references to “Equipment Lease Agreement” are, collectively, to that certain equipment lease agreement, dated June 24, 2010, between Chicopee, Inc., a wholly-owned subsidiary of the Company, and Gossamer Holdings, LLC, and the related construction agency agreement, guarantees and other documentation, pursuant to which we have constructed and began leasing, effective October 7, 2011, an integrated manufacturing line for the production of heat sealed polypropylene nonwoven fabrics; and (xvi) references to “Difco” or the “Difco business” are to Difco Performance Fabrics, Inc.

          On October 4, 2010, Polymer Group, Scorpio Merger Sub Corporation (“Merger Sub”), Parent and MatlinPatterson Global Opportunities Partners L.P. entered into an Agreement and Plan of Merger (the “Merger Agreement”). On January 28, 2011, Merger Sub merged with and into Polymer Group (the “Merger”), with Polymer Group being the surviving corporation following the Merger. As a result of the Merger, the Investor Group, through the ownership of Holdings, beneficially owns all of the issued and outstanding capital stock of Polymer Group. A portion of the aggregate merger consideration totaling $64.5 million, subject to adjustment as provided in the Merger Agreement, or approximately $2.91 per share (calculated on a fully diluted basis), was deposited in an escrow fund to cover liabilities, costs and expenses related to the application of the personal holding company (“PHC”) rules of the Internal Revenue Code of 1986, as amended (the “Code”), to Polymer Group and its subsidiaries in periods prior to the effective time of the Merger. Blackstone and the management investors invested $259.9 million in equity (including management rollover) in Holdings and management investors received options to acquire shares of Holdings. The Merger, the equity investment by the Investor Group, the entering into the ABL Facility (as defined in “Description of Other Indebtedness— ABL Facility”), the offering of the outstanding notes, the repayment of certain existing indebtedness of Polymer Group and its subsidiaries and the payment of related fees and expenses are collectively referred to in this prospectus as the “Transactions.”

          Our accounting for the Merger follows the requirements of ASC 805, which requires that the purchase accounting treatment of the Merger be “pushed down”, resulting in the adjustment of all of our net assets to their respective fair values as of the Merger date of January 28, 2011. Although we continued as the same legal entity after the Merger, the application of push down accounting represents the termination of the old reporting entity and the creation of a new reporting entity. Accordingly, the two entities are not presented on a consistent basis of accounting. As a result, our consolidated financial statements for 2011 are presented for the period from January 2, 2011 through January 28, 2011 and for the old reporting entity preceding the Merger, (the “Predecessor”), and for the period from January 29, 2011 through July 2, 2011 and for the new reporting entity succeeding the Merger (the “Successor”).

          The preliminary allocation of purchase price to the assets and liabilities as of January 28, 2011 has been determined by management with the assistance of outside valuation experts. At present, we are utilizing a preliminary valuation analysis prepared by our outside valuation experts for our inventories, property, plant and equipment and intangible assets. We anticipate that we will have a valuation study of our inventories, property, plant and equipment, intangible assets and goodwill for future periods. The allocation of the purchase price is subject to change based on the completion of such valuation study and the determination of other facts impacting fair value estimates. The adjustments, if any, arising out of the finalization of the allocation of the purchase price will not impact cash flow. However, such adjustments could result in material increases or decreases to depreciation and amortization, earnings before interest expense, income taxes and net income. We are continuing to evaluate our purchase price allocations and the related appraisal work of the asset appraisal firm. We expect to finalize the purchase price allocations prior to the end of fiscal year 2011.

          Our fiscal year ends on the Saturday nearest to December 31. Fiscal 2010 ended January 1, 2011 and included the results of operations for a fifty-two week period; Fiscal 2009 ended January 2, 2010 and included the results of operations for a fifty-two week period; Fiscal 2008 ended January 3, 2009 and included the results of operations for a fifty-three week period. References herein to “2010”, “2009,” and “2008,” generally refer to fiscal 2010, fiscal 2009 and fiscal 2008, respectively, unless the context indicates otherwise. Certain financial and other data presented in this prospectus is different from previously published as a result of a prior restatement of our previously issued financial statements, including the financial statements for the fiscal years ended January 2, 2010 and January 1, 2011.

          In this prospectus, all references to nonwovens volume demand and volume demand growth rates provided by ADL Consulting refer to nonwovens volume demand and volume demand growth rates in certain of the hygiene, medical, wipes and industrial applications which we serve.

          The term “CAGR” as used in this prospectus refers to the compound annual growth rate over the specified period. Totals in some tables in this prospectus may differ from the sum of individual amounts in those tables due to rounding. References to “spunmelt” or “spunmelt technology” in this prospectus refer to spunmelt, spunlaid, spunbond, or related manufacturing technologies, inclusively.

          Defined terms in the consolidated financial statements have the meanings subscribed to them in the consolidated financial statements.

Key Product										Projected
Applications		% of Annual Revenue				Representative End Products		Key Customers		Growth(1)
Hygiene			50	%		Baby diapers, feminine hygiene products, adult incontinence products, and training pants		•    Procter & Gamble •    Kimberly-Clark •    SCA			5.4	%
Medical			16	%		Surgical gowns and drapes, face masks, shoe covers and wound care sponges and dressings		•    Kimberly-Clark •    Cardinal Health •    3M •    Johnson & Johnson			5.9	%
Wipes			14	%		Personal care and facial wipes, baby wipes, and household wipes		•    Procter & Gamble •    Clorox •    Sysco			8.7	%
Industrial			20	%		Filtration, cable wrap, house wrap, furniture and bedding, and landscape and agricultural applications		•    Simmons Bedding •    Dow •    Chiquita			6.0	%

(1)		Represents projected CAGR for global nonwoven volume demand from 2009 to 2014 for each product application group, according to ADL Consulting.

		market for the exchange notes, as permitted by applicable laws and regulations. However, they are not obligated to do so and may discontinue any such market making activities at any time without notice. We do not intend to apply for a listing of the exchange notes on any securities exchange or automated dealer quotation system.
Governing Law		The exchange notes will be governed by the laws of the State of New York.

		Predecessor																					Successor
																		January 2,
		Fiscal Year Ended																2011					January 29,
														Six Months				through					2011
		January 3,				January 2,				January 1,				Ended July 3,				January 28,					through
		2009				2010				2011				2010				2011					July 2, 2011
														(dollars in millions)
														(unaudited)				(unaudited)					(unaudited)
Statement of Operations Data:
Net sales		$	1,026.2			$	850.6			$	1,106.2			$	548.2			$	84.6				$	495.7
Cost of goods sold			856.6				667.2				896.3				447.9				68.5					425.0
Gross profit			169.6				183.4				209.9				100.3				16.1					70.7
Selling, general and administrative expenses			115.5				113.3				141.5				67.3				11.6					62.3
Acquisition and integration expenses			—				1.8				1.7				1.7				—					—
Special charges, net			20.1				20.8				18.0				9.4				20.8					34.8
Other operating (income) loss, net			4.9				(4.7	)			(0.8	)			(1.0	)			(0.6	)				1.0
Operating income (loss)			29.1				52.2				49.5				22.9				(15.7	)				(27.4	)
Other expense (income):
Interest expense, net			31.1				26.7				31.7				16.8				1.9					20.7
Gain on reacquisition of debt			—				(2.4	)			—				—				—					—
Loss on extinguishment of debt			—				5.1				—				—				—					—
Foreign currency and other loss, net			0.5				5.2				1.5				0.9				0.1					1.2
(Loss) income before income tax expense and discontinued operations			(2.5	)			17.6				16.3				5.2				(17.7	)				(49.3	)
Income tax expense (benefit)			7.0				8.6				4.5				5.2				0.6					(1.7	)
(Loss) income from continuing operations		$	(9.5	)		$	9.0			$	11.8			$	—			$	(18.3	)			$	(47.6	)

		Predecessor																					Successor
																		January 2,
		Fiscal Year Ended																2011					January 29,
														Six Months				through					2011
		January 3,				January 2,				January 1,				Ended July 3,				January 28,					through
		2009				2010				2011				2010				2011					July 2, 2011
														(dollars in millions)
														(unaudited)				(unaudited)					(unaudited)
Statement of Cash Flows Data:
Cash provided by (used in) operating activities		$	59.5			$	99.0			$	63.2			$	17.6			$	(25.3	)			$	(27.7	)
Cash used in investing activities			(31.6	)			(14.6	)			(41.3	)			(9.2	)			(8.3	)				(431.5	)
Cash provided by (used in) financing activities			(12.9	)			(72.7	)			(8.1	)			(4.0	)			31.4					442.0

		Predecessor																					Successor
																		January 2,
		Fiscal Year Ended																2011					January 29,
														Six Months				through					2011
		January 3,				January 2,				January 1,				Ended July 3,				January 28,					through
		2009				2010				2011				2010				2011					July 2, 2011
														(dollars in millions)
														(unaudited)				(unaudited)					(unaudited)
Balance Sheet Data (end of period):
Cash and cash equivalents		$	45.7			$	57.9			$	72.3			$	61.3			$	70.8				$	54.9
Operating working capital(a)			95.8				79.2				53.1				57.0				52.7					81.3
Total assets			702.2				699.9				732.0				707.9				819.3					1,125.9
Long-term debt, less current portion			392.5				322.0				328.2				301.9				359.5					590.5
Total Polymer Group, Inc. shareholders’ equity			61.8				116.4				134.3				112.8				148.2					222.3
Ratio of earnings to fixed charges(b)			—				1.6x				1.5x				1.3x				—					—

(a)		Operating working capital is defined as accounts receivable plus inventories less trade accounts payable and accrued liabilities.
(b)		For purposes of determining the ratio of earnings to fixed charges, earnings are defined as pre-tax earnings from continuing operations plus fixed charges. Fixed charges include interest expense on all indebtedness, amortization of debt issuance fees and one-third of rental expense on operating leases representing that portion of rental expense deemed to be attributable to interest. Earnings were insufficient to cover fixed charges for the fiscal year ended January 3, 2009 by $2.6 million. Earnings were insufficient to cover fixed charges for the periods from January 2, 2011 through January 28, 2011 and from January 29, 2011 through July 2, 2011 by $17.9 million and $50.3 million, respectively.

RISK FACTORS

           You should carefully consider the following risk factors and all other information contained in this prospectus before participating in the exchange offer. The risks and uncertainties described below are not the only risks facing us and your investment in the notes. Additional risks and uncertainties that we are unaware of, or those we currently deem immaterial, also may become important factors that affect us. The following risks could materially and adversely affect our business, financial condition, cash flows or results of operations.

Risks Related to the Exchange Offer

If you choose not to exchange your outstanding notes in the exchange offer, the transfer restrictions currently applicable to your outstanding notes will remain in force and the market price of your outstanding notes could decline.

          If you do not exchange your outstanding notes for exchange notes in the exchange offer, then you will continue to be subject to the transfer restrictions on the outstanding notes as set forth in the offering memorandum distributed in connection with the private offering of the outstanding notes. In general, the outstanding notes may not be offered or sold unless they are registered or exempt from registration under the Securities Act and applicable state securities laws. Except as required by the registration rights agreement, we do not intend to register resales of the outstanding notes under the Securities Act.

          The tender of outstanding notes under the exchange offer will reduce the remaining principal amount of the outstanding notes, which may have an adverse effect upon and increase the volatility of, the market price of the outstanding notes due to reduction in liquidity.

Your ability to transfer the notes may be limited by the absence of an active trading market, and an active trading market may not develop for the notes.

          The exchange notes are a new issue of securities for which there is no established trading market. We do not intend to have the exchange notes listed on a national securities exchange or to arrange for quotation on any automated quotation system. The initial purchasers have advised us that they intend to make a market in the exchange notes, as permitted by applicable laws and regulations; however, the initial purchasers are not obligated to make a market in the exchange notes, and they may discontinue their market-making activities at any time without notice. Therefore, we cannot assure you as to the development or liquidity of any trading market for the exchange notes. The liquidity of any market for the exchange notes will depend on a number of factors, including:

	•		the number of holders of exchange notes;
	•		our operating performance and financial condition;
	•		the market for similar securities;
	•		the interest of securities dealers in making a market in the exchange notes; and
	•		prevailing interest rates.

          Historically, the market for non-investment grade debt has been subject to disruptions that have caused substantial volatility in the prices of securities similar to the exchange notes. The market, if any, for the exchange notes may face similar disruptions that may adversely affect the prices at which you may sell your exchange notes. Therefore, you may not be able to sell your exchange notes at a particular time and the price that you receive when you sell may not be favorable.

Risks Related To Our Business

Because the specialized markets in which we sell our products are highly competitive, we may have difficulty growing our business year after year.

          The markets for our products are highly competitive. The primary competitive factors include product innovation and performance, quality, service, cost, distribution and technical support. In addition, we compete against a number of competitors in each of our markets. Some of these competitors are larger companies that have greater financial, technological, manufacturing and marketing resources than us. A reduction in overall demand, a significant increase in market capacity or increased costs to design and produce our products would likely further increase competition and that increased competition could cause us to reduce our prices, which could lower our profit margins and impair our ability to grow from year to year.

We must continue to invest significant resources in developing innovative products in order to maintain a competitive edge in the highly specialized markets in which we operate.

          Our continued success depends, in part, upon our ability to maintain our technological capabilities and to continue to identify, develop and commercialize innovative products for the nonwoven and oriented polymer industries. We must also protect the intellectual property rights underlying our new products to realize the full benefits of our efforts. If we fail to continue to develop products for our markets or to keep pace with technological developments by our competitors, we may lose market share, which could reduce product sales, lower our profits and impair our financial condition.

The loss of any of our large volume customers could significantly reduce our revenues and profits.

          A significant amount of our products are sold to large volume customers. For example, our largest customer is Procter & Gamble, which represented 14% of our sales in 2010. Our 20 largest customers represented 56% of our sales for the same period, and included Cardinal Health, Clorox, Dow, Johnson & Johnson, Kimberly-Clark, Molnlycke, Procter & Gamble, SCA, and other global and regional manufacturers. As a result, a decrease in business from, or the loss of, any large volume customers could materially reduce our product sales, lower our profits and impair our financial condition.

Increases in prices for raw materials and energy or the unavailability of raw materials could reduce our profit margins.

          The primary raw materials used to manufacture most of our products are polypropylene resins, polyester fiber, polyethylene resin and, to a lesser extent, rayon and tissue paper. In addition, energy related costs are a significant expense for us. The prices of raw materials and energy can be volatile and are susceptible to rapid and substantial changes due to factors beyond our control such as changing economic conditions, currency fluctuations, political unrest and instability in energy-producing nations, and supply and demand considerations. To the extent that we are able to pass along at least a portion of raw material price increases to some of our customers, there is often a delay between the time we are required to pay the increased raw material price and the time we are able to pass the increase on to our customers. To the extent we are not able to pass along all or a portion of such increased prices of raw materials, our cost of goods sold would increase and our operating income would correspondingly decrease. By way of example, as of January 1, 2011, if the price of polypropylene were to rise $0.01 per pound and we were not able to pass along any of such increase to our customers, we would realize a decrease of approximately $5.5 million, on an annualized basis, in our reported pre-tax operating income. There can be no assurance that the prices of polypropylene, polyethylene and polyester will not increase in the future or that we will be able to pass on any increases to our customers. Material increases in raw material prices that cannot be passed on to customers could have a material adverse effect on our profit margins, results of operations and financial condition. In addition, the loss of any of our key suppliers in the short-term could disrupt our business until we secure alternative supply arrangements or until alternative suppliers were qualified with customers.

Reductions in our selling prices to customers, pursuant to contractual requirements, could reduce our profit margins.

          In cases where changes in our selling prices to customers are determined via contract based on changes in an underlying raw material price index, such as the index for polypropylene, and the index decreases, sales would decrease and our operating income would correspondingly decrease if we are not able to obtain corresponding reductions in our raw material costs, which decreases in operating income could be material. There can be no assurance that the index used in such contracts will not decrease in the future or that we will be able to obtain corresponding reductions in our raw material costs.

In response to changing market conditions, we may decide to restructure certain of our operations, resulting in additional cash restructuring charges and asset impairment charges.

          We review our business on an ongoing basis relative to current and expected market conditions, attempting to match our production capacity and cost structure to the demands of the markets in which we participate, and we strive to continuously streamline our manufacturing operations consistent with world-class standards. Accordingly, from time to time in the future, we may decide to undertake certain restructuring efforts to improve our competitive position. To the extent such decisions are made, we could incur cash restructuring charges and asset impairment charges associated with the restructuring, and such charges could be material.

A material disruption at one of our manufacturing facilities could prevent us from meeting customer demand, reduce our sales or negatively affect our results of operation and financial condition.

          Any of our manufacturing facilities, or any of our machines or equipment within an otherwise operational facility, could cease operations unexpectedly due to a number of events, including:

	•		unscheduled maintenance outages;
	•		prolonged power failures;
	•		an equipment failure;
	•		a chemical spill or release;
	•		explosion of a boiler;
	•		labor difficulties;
	•		disruptions in transportation infrastructure, including roads, bridges, railroad tracks and tunnels;
	•		fires, floods, windstorms, earthquakes, hurricanes or other catastrophes;
	•		terrorism or threats of terrorism;
	•		governmental regulations; and
	•		other operational problems.

          Any such disruption could prevent us from meeting customer orders, reduce our sales or profits and negatively affect our results of operations and financial condition.

          For example, in December 2010, a severe rainy season impacted many parts of Colombia and caused us to temporarily cease manufacturing at our Cali, Colombia facility due to a breach of a levy and flooding at the industrial park where our facility is located. We established temporary offices away from the flooded area and

worked with our customers to meet their critical needs through the use of our global manufacturing base. At the beginning of the second quarter of 2011, the facility had been fully restored and we had initiated production. The operations at this facility reached full run rates in the third quarter of 2011. During the period that the facility was not operational, we estimate that our profits were negatively impacted by approximately $2.5 million to $3.5 million per month due to overhead costs related to the restoration and lost profit contribution from the facility. The cash costs to restore operations are estimated to be approximately $12.5 million to $13.5 million. Through July 2, 2011, cash spending was $10.4 million. The cash outflows were offset by approximately $5.7 million of proceeds from all relevant insurance policies, of which $5.3 million had been collected by July 2, 2011. See Note 23 “Business Interruption and Insurance Recovery” in the notes to the consolidated financial statements included within this prospectus for further information.

Because a significant number of our employees are represented by labor unions or trade councils and work under collective bargaining agreements, any employee slowdown or strikes or the failure to renew our collective bargaining agreements could disrupt our business.

          As of January 1, 2011, approximately 47% of our employees are represented by labor unions or trade councils and work under collective bargaining agreements. Approximately 36% of our labor force is covered by collective bargaining agreements that expire within one year. We may not be able to maintain constructive relationships with these labor unions or trade councils. We may not be able to successfully negotiate new collective bargaining agreements on satisfactory terms in the future. The loss of a substantial number of these employees or a prolonged labor dispute could disrupt our business. Any such disruption could reduce our revenues, increase our costs and result in significant losses.

We generate most of our revenue from the sale of manufactured products that are used in a wide variety of consumer and industrial applications and the potential for product liability exposure could be significant.

          We manufacture a wide variety of products that are used in consumer and industrial applications, such as disposable diapers, baby wipes, surgical gowns, wound dressings, carpet backing and industrial packaging. As a result, we may face exposure to product liability claims in the event that the failure of our products results, or is alleged to result, in property damage, bodily injury and/or death. In addition, if any of our products are, or are alleged to be, defective, we may be required to make warranty payments or to participate in a recall of those products.

          The future costs associated with defending product liability claims or responding to product warranty claims could be material and we may experience significant losses in the future as a result. A successful product liability claim brought against us in excess of available insurance coverage or a requirement to participate in any product recall could substantially reduce our profitability and cash generated from operations.

We rely on a limited number of suppliers to provide significant machinery and components used in our production facilities. A material interruption in supply could prevent or limit our ability to accept and fill orders for our products.

          We currently depend upon a limited number of outside unaffiliated suppliers for key machinery and components used in our manufacturing and converting facilities. We cannot produce most of our nonwoven and oriented polyolefin products within the specifications required by our customers without such key machinery and components. If any of our suppliers cease to provide new machinery and components or replacement parts for existing machinery and components in sufficient quantity to meet our needs, there may not be adequate alternative sources of supply. To date, we have been able to obtain the required machinery and components to allow us to expand our business and supply products to our customers within their required specifications without any significant delays or interruptions. Obtaining alternative sources of such machinery and components could involve significant delays and other costs, and these supply sources may not be available to us on reasonable terms or at all. In some cases, we expect that it would take several months, or longer, for a new supplier to begin providing machinery and components to specification. Any disruption of machinery and component supplies could result in lost or deferred sales which could adversely affect our business and financial results.

Our international operations pose risks to our business that may not be present with our domestic operations.

          Our manufacturing facilities in the United States accounted for approximately 30% of net sales for 2010, with facilities in Europe, Latin America, Canada and Asia accounting for approximately 70% of net sales for the same period. As part of our growth strategy, we may expand operations in foreign countries where we have an existing presence or enter new foreign markets. Our foreign operations are, and any future foreign operations will be, subject to certain risks that are unique to doing business in foreign countries. These risks include fluctuations in foreign currency exchange rates, inflation, economic or political instability, shipping delays, changes in applicable laws, including assessments of income and non-income related taxes, reduced protection of intellectual property and regulatory policies and various trade restrictions including potential changes to export taxes or countervailing and anti-dumping duties for exported products from these countries. Any of these risks could have a negative impact on our ability to deliver products to customers on a competitive and timely basis. This could reduce or impair our net sales, profits, cash flows and financial position. We have not historically hedged our exposure to foreign currency risk except for risk associated with certain capital spending projects.

We could incur substantial costs to comply with environmental laws, and violations of such laws may increase costs or require us to change certain business practices.

          We use and generate a variety of chemicals in our manufacturing operations. As a result, we are subject to a broad range of federal, state, local and foreign environmental laws and regulations. These environmental laws govern, among other things, air emissions, wastewater discharges, the handling, storage and release of wastes and hazardous substances and cleanup of contaminated sites. We regularly incur costs to comply with environmental requirements, and such costs could increase significantly with changes in legal requirements or their interpretation or enforcement. For example, certain local governments have adopted ordinances prohibiting or restricting the use or disposal of certain plastic products, such as certain of the plastic wrapping materials that we produce. Widespread adoption of such prohibitions or restrictions could adversely affect demand for our products and thereby have a material adverse effect upon us. In addition, a decline in consumer preference for plastic products due to environmental considerations could have a material adverse effect upon us. We could incur substantial costs, including clean-up costs, fines and sanctions and third-party property damage or personal injury claims, as a result of violations of environmental laws. Failure to comply with environmental requirements could also result in enforcement actions that materially limit or otherwise affect our operations at our manufacturing facilities. We are also subject to laws, such as the CERCLA, that may impose liability retroactively and without fault for releases or threatened releases of regulated materials at on-site or off-site locations.

          Additionally, greenhouse gas (“GHG”) emissions have increasingly become the subject of a large amount of international, national, regional, state and local attention. Cap and trade initiatives to limit GHG emissions have been enacted in the European Union. Numerous bills related to climate change have been introduced in the U.S. Congress, and various states have taken or are considering actions to regulate GHG emissions, which could adversely impact many industries including our suppliers or customers, which may result in higher costs or other impacts to our business. Within the U.S., most of these proposals would regulate and/or tax, in one fashion or another, the production of carbon dioxide and other GHGs to facilitate the reduction of carbon compound emissions to the atmosphere, and provide tax and other incentives to produce and use more clean energy. For example, in 2009, the U.S. House of Representatives passed the Markey-Waxman bill (HR 2454), which would establish a so-called cap and trade regime and new permitting requirements to regulate GHG generation, as well as provide an incentive for the production and use of clean energy. To date, the U.S. Senate has not passed any comparable legislation and Congressional approval of such legislation currently appears unlikely. Of course, some form of federal GHG legislation remains possible. On the regulatory front, the U.S. Environmental Protection Agency (“EPA”) has recently taken actions under the Clean Air Act (“CAA”) regarding GHG emissions, including the issuance of regulations requiring certain entities to measure and report their GHG emissions and rules which could require certain facilities to adopt measures to control GHG emissions under the Title V and/or Prevention of Significant Deterioration CAA permitting programs commencing in 2011. However, there are various legislative and legal efforts underway to modify, defer or block EPA regulation of GHG emissions. For example, a House Energy and Commerce subcommittee recently passed a measure which would eliminate the EPA’s authority to regulate GHG emissions and repeal certain related rules, including those stated above. Although it is anticipated that the House will pass this measure within the coming weeks, the outlook for its passage is less certain in the Senate.

If we are unable to adequately protect our intellectual property, we could lose a significant competitive advantage.

          Our success depends, in part, on our ability to protect our technologies and products against competitive pressure and to defend our intellectual property rights. If we fail to adequately protect our intellectual property rights, competitors may manufacture and market similar products, which could adversely affect our market share and results of operations. We consider our patents and trademarks, in the aggregate, to be important to our business and seek to protect our proprietary know-how in part through United States and foreign patent and trademark registrations. We have a total of over 450 trademark and domain name registrations and pending trademark applications worldwide and over 400 patents and pending patent applications worldwide, and maintain certain trade secrets for which, in order to maintain the confidentiality of such trade secrets, we have not sought patent protection. We may not receive patents for all our pending patent applications, and existing or future patents or licenses may not provide competitive advantages for our products. Our competitors may challenge, invalidate or avoid the application of any existing or future patents, trademarks, or other intellectual property rights that we receive or license. In addition, patent rights may not prevent our competitors from developing, using or selling products that are similar or functionally equivalent to our products. The loss of protection for our intellectual property could reduce the market value of our products, reduce product sales, lower our profits, and impair our financial condition.

The loss of our senior management could disrupt our business.

          Our senior management is important to the success of our business because there is significant competition for executive personnel with experience in the nonwoven and oriented polyolefin industries. As a result of this need and the competition for a limited pool of industry-based executive experience, we may not be able to retain our existing senior management. In addition, we may not be able to fill new positions or vacancies created by expansion or turnover. The loss of any member of our senior management team without retaining a suitable replacement (either from inside or outside our existing management team) could restrict our ability to enhance existing products in a timely manner, sell products to our customers or manage the business effectively.

The success of our business depends, in part, on achieving our objectives for strategic acquisitions and dispositions.

          We may pursue acquisitions or joint ventures as part of our long-term business strategy. In pursuing these transactions, we may encounter significant challenges and risks including that the transaction does not advance our business strategy, that we do not realize a satisfactory return on the investment made, or that we experience difficulty in completing such transactions or in the integration of new operations, employees, business systems, and technology, or diversion of management’s attention from our other businesses. These factors could adversely affect our operating results or financial condition.

          We may, as part of our long-term business strategy, evaluate the potential disposition of assets and businesses that may no longer be in alignment with our strategic direction. When we decide to sell assets or businesses, we may encounter difficulty finding buyers or alternative exit strategies on acceptable terms in a timely manner, which could delay the accomplishment of strategic objectives, or we may dispose of a business at a price or on terms which are less than optimal. In addition, there is a risk that we sell a business whose subsequent performance exceeds expectations, in which case the decision would have potentially sacrificed enterprise value. Alternatively, we may be too optimistic about a particular business’s prospects, in which case we may be unable to find a buyer at an acceptable price or sacrifice enterprise value by retaining such business.

We may not be able to recover the carrying value of our long-lived assets, which could require us to record additional asset impairment charges and materially and adversely affect our results of operations.

          We had net property, plant and equipment of $508.7 million at July 2, 2011, representing 45% of our total assets. At January 1, 2011, we had property, plant and equipment of $323.1 million, representing 44% of our total assets. We recorded impairment charges to property, plant and equipment of $0.7 million, $3.4 million and $13.1 million for 2010, 2009 and 2008, respectively. Restructuring initiatives and changing market conditions can impact our ability to recover the carrying value of our long-lived assets. The continuing presence of these factors, as well as

other factors, could require us to record additional asset impairment charges in future periods which could materially and adversely affect our results of operations.

Goodwill and other identifiable intangible assets represent a significant portion of our total assets, and we may never realize the full value of our intangible assets.

          As of July 2, 2011, we have recorded, on a preliminary basis, $137.3 million of goodwill and other intangibles assets, excluding deferred financing costs, associated with the Transactions. Goodwill and other identifiable intangible assets are recorded at fair value on the date of acquisition. We review such assets at least annually for impairment. Impairment may result from, among other things, deterioration in performance, adverse market conditions, adverse changes in applicable laws or regulations, including changes that restrict the activities of or affect the products and services we sell, challenges to the validity of certain registered intellectual property, reduced sales of certain products incorporating registered intellectual property, and a variety of other factors. The amount of any quantified impairment must be expensed immediately as a charge to results of operations. Depending on future circumstances, it is possible that we may never realize the full value of our intangible assets. Any future determination of impairment of goodwill or other identifiable intangible assets could have a material adverse effect on our financial position and results of operations.

Our business may be adversely affected by economic downturns.

          General worldwide economic conditions recently experienced a downturn due to the sequential effects of the subprime lending crisis, general credit market crisis, collateral effects on the finance and banking industries, increased energy costs, concerns about inflation, slower economic activity, decreased consumer confidence, reduced corporate profits and capital spending, adverse business conditions and liquidity concerns. These conditions make it difficult for our customers, our vendors and us to accurately forecast and plan future business activities, and they could cause U.S. and foreign businesses to slow spending on our products, primarily in the industrial sector, which would delay and lengthen sales cycles. We cannot predict the timing or duration of any economic slowdown or the timing or strength of a subsequent economic recovery, worldwide, or in the specific end markets we serve. If certain of the markets we serve significantly deteriorate due to these economic effects, our business, financial condition and results of operations may be materially and adversely affected. Additionally, the downturn in economic conditions has negatively impacted the equity markets. As a result, we may experience changes in the funding positions of our defined benefit plans, which may result in increased funding requirements in the future. These factors have also resulted in a tightening in the global credit markets which could impact the ability to renew or extend short-term financing arrangements by us or our customers.

We may have certain unreimbursed costs or liabilities associated with the application of the PHC rules.

          In connection with the Merger, a portion of the aggregate merger consideration totaling $64.5 million, subject to adjustment as provided in the Merger Agreement, was deposited in an escrow fund to cover liabilities, costs and expenses related to the application of the PHC rules of the Code to Polymer Group and its subsidiaries in periods prior to the effective time of the Merger. Polymer Group’s most recent financial statements as of January 1, 2011, reflected a liability for uncertain tax positions associated with the PHC issue of approximately $16.2 million. As provided under the Merger Agreement, the Stockholder Representative (as defined in the Merger Agreement) filed a ruling request with the IRS to determine whether or not Polymer Group, Inc. or any of its subsidiaries were in fact a PHC and subject to the tax as a PHC. The initial ruling request was filed on December 15, 2010, with supplemental filings on June 2, 2011 and June 20, 2011. As of the date hereof, we have not received the ruling from the IRS. The actual tax liability relating to the application of the PHC rules in such periods will depend on the outcome of this process. We expect that the amount in the escrow fund will be sufficient to cover the actual tax liability related to the application of the PHC rules in such periods. However, in certain circumstances, we could be liable for costs and liabilities relating to the application of the PHC rules. As of September 2011, the statute of limitations for the 2004 tax year has expired. Pursuant to the Merger Agreement, the amount in respect of potential PHC liability being held in the escrow related to the 2004 taxable year is subject to release. As of October 21, 2011, the amount to be released associated with the expired 2004 taxable year has not been finally determined by the parties.

If we fail to maintain effective internal control over financial reporting at a reasonable assurance level, we may not be able to accurately report our financial results, and may require the restatement of previously published financial information which could have a material adverse effect on our operations, investor confidence in our business and the trading prices of our securities.

     We have identified past accounting errors which resulted in the restatement of previously issued financial statements, including the financial statements for the fiscal years ended January 2, 2010 and January 1, 2011. Such accounting errors resulted from a material weakness and other identified deficiencies in our internal control over financial reporting associated with processes related to (i) the preparation and adjustment of our tax accounts and (ii) intercompany reconciliations. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

     We have designed and have implemented extensive remediation programs to address these internal control deficiencies and material weaknesses and to strengthen our internal controls over financial reporting. Management believes that our remediation efforts have been effective with respect to our internal control over financial reporting associated with tax accounting and intercompany reconciliations. The previous material weaknesses in our internal controls associated with tax accounting and intercompany reconciliations have been remediated. Management concluded that our internal controls over financial reporting as of January 1, 2011 are both designed and operating effectively.

     If additional material weaknesses in our internal controls are discovered in the future, they may adversely affect our ability to record, process, summarize and report financial information timely and accurately and, as a result, we may fail to prevent or detect material misstatements in our annual or interim financial statements.

     In addition, it is possible that control deficiencies could be identified by our management or by our independent registered accounting firm in the future or may occur without being identified. Such a failure could result in regulatory scrutiny, cause investors to lose confidence in our reported financial condition, lead to a default under our indebtedness and otherwise materially adversely affect our business and financial condition.

Affiliates of the Sponsor own substantially all of the equity interests in us and may have conflicts of interest with us or the holders of the notes in the future.

          As a result of the Merger, the Sponsor owns a substantial majority of our capital stock, and the Sponsor designees hold a majority of the seats on our board of directors. As a result, affiliates of the Sponsor will have control over our decisions to enter into any corporate transaction and will have the ability to prevent any transaction that requires the approval of stockholders regardless of whether holders of the notes believe that any such transactions are in their own best interests. For example, affiliates of the Sponsor could collectively cause us to make acquisitions that increase the amount of our indebtedness or to sell assets, or could cause us to issue additional capital stock or declare dividends. So long as the Sponsor continues to indirectly own a significant amount of the outstanding shares of our common stock, affiliates of the Sponsor will continue to be able to strongly influence or effectively control our decisions. The indenture governing the notes and the credit agreement governing our ABL Facility will permit us to pay advisory and other fees, dividends and make other restricted payments to the Sponsor under certain circumstances and the Sponsor or its affiliates may have an interest in our doing so. In addition, the Sponsor has no obligation to provide us with any additional debt or equity financing.

          The Sponsor is in the business of making investments in companies and may from time to time acquire and hold interests in businesses that compete directly or indirectly with us or that supply us with goods and services. The Sponsor may also pursue acquisition opportunities that may be complementary to our business and, as a result, those acquisition opportunities may not be available to us. See “Security Ownership of Principal Stockholders and Management,” “Certain Relationships and Related Party Transactions,” “Description of Notes,” and “Description of Other Indebtedness.”

Risks Relating to the Notes

Our substantial indebtedness could adversely affect our financial condition and prevent us from fulfilling our obligations under the notes.

          We have a substantial amount of debt, which requires significant interest and principal payments. As of July 2, 2011, our total debt is approximately $597.8 million. Subject to the limits contained in the credit agreement

governing our ABL Facility, the Indenture governing the notes and our other debt instruments, we may be able to incur substantial additional debt from time to time to finance working capital, capital expenditures, investments or acquisitions, or for other purposes. If we do so, the risks related to our high level of debt could increase. Specifically, our high level of debt could have important consequences to the holders of the notes, including the following:

•

making it more difficult for us to satisfy our obligations with respect to the notes and our other debt;

•

limiting our ability to obtain additional financing to fund future working capital, capital expenditures, acquisitions or other general corporate requirements;

•

requiring a substantial portion of our cash flows to be dedicated to debt service payments instead of other purposes, thereby reducing the amount of cash flows available for working capital, capital expenditures, acquisitions and other general corporate purposes;

•

increasing our vulnerability to general adverse economic and industry conditions;

•

exposing us to the risk of increased interest rates as certain of our borrowings are at variable rates of interest;

•

limiting our flexibility in planning for and reacting to changes in the industry in which we compete;

•

placing us at a disadvantage compared to other, less leveraged competitors; and

•

increasing our cost of borrowing.

Despite our current level of indebtedness, we may be able to incur substantially more debt. This could further exacerbate the risks to our financial condition described above.

          We may be able to incur significant additional indebtedness in the future. Although the indenture governing the notes and the credit agreement governing the ABL Facility contain restrictions on the incurrence of additional indebtedness, these restrictions are subject to a number of qualifications and exceptions and additional indebtedness incurred in compliance with these restrictions could be substantial. These restrictions also will not prevent us from incurring obligations, such as trade payables, that do not constitute indebtedness as defined under our debt instruments. In addition, our ABL Facility provides for unused commitments of $29.2 million (subject to availability under a borrowing base and after giving effect to $10.8 million of outstanding letters of credit) as of July 2, 2011. Furthermore, we may increase our commitments under our ABL Facility without the consent of lenders under our ABL Facility other than those lenders, who, in their discretion, issue a commitment to provide all or a portion of such increase by up to an additional $20.0 million, subject to certain conditions, including debt capacity under the indentures governing the notes. To the extent new debt is added to our currently anticipated debt levels, the substantial leverage risks described in the previous risk factor would increase. See “Description of Other Indebtedness” and “Description of Notes.”

Our variable rate indebtedness subjects us to interest rate risk, which could cause our indebtedness service obligations to increase significantly.

          Borrowings under our ABL Facility and certain of our foreign indebtedness are at variable rates of interest and expose us to interest rate risk. If interest rates increase, our debt service obligations on the variable rate indebtedness would increase even though the amount borrowed remained the same, and our net income and cash flows, including cash available for servicing our indebtedness, would correspondingly decrease.

We may be unable to service our indebtedness, including the notes.

          Our ability to make scheduled payments on and to refinance our indebtedness including the notes, depends on and is subject to our financial and operating performance, which in turn is affected by general and regional

economic, financial, competitive, business and other factors beyond our control, including the availability of financing in the international banking and capital markets. We cannot assure you that our business will generate sufficient cash flow from operations or that future borrowings will be available to us in an amount sufficient to enable us to service our debt, including the notes, to refinance our debt or to fund our other liquidity needs. If we are unable to meet our debt service obligations or to fund our other liquidity needs, we will need to restructure or refinance all or a portion of our debt, including the notes, which could cause us to default on our debt obligations and impair our liquidity. Any refinancing of our indebtedness could be at higher interest rates and may require us to comply with more onerous covenants that could further restrict our business operations.

          Moreover, in the event of a default, the holders of our indebtedness, including the notes and the ABL Facility, could elect to declare all the funds borrowed to be due and payable, together with accrued and unpaid interest. The lenders under our ABL Facility could also elect to terminate their commitments thereunder, cease making further loans, and institute foreclosure proceedings against their collateral, and we could be forced into bankruptcy or liquidation. If our operating performance declines, we may in the future need to obtain waivers from the required lenders under our ABL Facility to avoid being in default. If we breach our covenants under our ABL Facility, we would be in default under our ABL Facility. The lenders could exercise their rights, as described above, and we could be forced into bankruptcy or liquidation.

The indenture governing the notes, the credit agreement governing our ABL Facility and the Lease Agreement associated with the new U.S. spunmelt line impose significant operating and financial restrictions on us, which may prevent us from capitalizing on business opportunities.

          The indenture governing the notes, the credit agreement governing our ABL Facility and the Lease Agreement associated with the new U.S. spunmelt line impose significant operating and financial restrictions on us. These restrictions will limit our ability to, among other things:

•

incur additional indebtedness, issue preferred stock or enter into sale and leaseback obligations;

•

pay certain dividends or make certain distributions on our capital stock or repurchase or redeem our capital stock;

•

make certain capital expenditures;

•

make certain loans, investments or other restricted payments;

•

place restrictions on the ability of subsidiaries to pay dividends or make other payments to us;

•

engage in transactions with stockholders or affiliates;

•

sell certain assets or engage in mergers, acquisitions and other business combinations;

•

amend or otherwise alter the terms of our indebtedness;

•

alter the business that we conduct;

•

guarantee indebtedness or incur other contingent obligations; and

•

create liens.

          In addition, the restrictive covenants in our ABL Facility may require us to maintain a specified financial ratio and satisfy other financial condition tests, under certain conditions. Our ability to comply with those financial ratios and tests can be affected by factors beyond our control.

          As a result of these restrictions, we will be limited as to how we conduct our business and we may be unable to raise additional debt or equity financing to compete effectively or to take advantage of new business opportunities. The terms of any future indebtedness we may incur could include more restrictive covenants. We cannot assure you that we will be able to maintain compliance with these covenants in the future and, if we fail to do so, that we will be able to obtain waivers from the lenders and/or amend the covenants.

          Our failure to comply with the restrictive covenants described above as well as other terms of our existing indebtedness and/or the terms of any future indebtedness from time to time could result in an event of default, which, if not cured or waived, could result in our being required to repay these borrowings before their due date. If we are forced to refinance these borrowings on less favorable terms or cannot refinance these borrowings, our results of operations and financial condition could be adversely affected.

Our failure to comply with the agreements relating to our outstanding indebtedness, including as a result of events beyond our control, could result in an event of default that could materially and adversely affect our results of operations and our financial condition.

          If there were an event of default under any of the agreements relating to our outstanding indebtedness, the holders of the defaulted debt could cause all amounts outstanding with respect to that debt to be due and payable immediately. We cannot assure you that our assets or cash flow would be sufficient to fully repay borrowings under our outstanding debt instruments if accelerated upon an event of default. Further, if we are unable to repay, refinance or restructure our indebtedness under our secured debt, the holders of such debt could proceed against the collateral securing that indebtedness. In addition, any event of default or declaration of acceleration under one debt instrument could also result in an event of default under one or more of our other debt instruments.

Claims of holders of the notes will be effectively subordinated to claims of lenders under the ABL Facility to the extent of the value of the collateral securing the ABL Facility on a first-priority lien basis.

          The notes are secured on a first-priority lien basis by the Notes Collateral (as defined below) and on a second-priority lien basis by the ABL Collateral (as defined below), subject to certain exceptions and permitted liens. The notes and the related guarantees will be effectively subordinated in right of payment to all of our existing and future subsidiary guarantors’ secured indebtedness under the ABL Facility to the extent of the value of the collateral securing the ABL Facility on a first-priority lien basis. In the event of a bankruptcy, liquidation, dissolution, reorganization or similar proceeding against us, the assets that are securing indebtedness under the ABL Facility on a first-priority lien basis must first be used to pay the first-priority claims under the ABL Facility in full before these assets may be used to make any payments on the notes. After claims of the lenders under the ABL Facility have been satisfied in full, to the extent of the value of the collateral securing the ABL Facility on a first-priority lien basis, there may be no assets remaining under the ABL Collateral that may be applied to satisfy the claims of holders of the notes. See “Description of Other Indebtedness — ABL Facility.”

Claims of holders of the notes will be structurally subordinated to claims of creditors of certain of our subsidiaries that will not guarantee the notes.

          The notes may not be guaranteed by certain of our existing and future subsidiaries, including all of our non-U.S. subsidiaries. Accordingly, claims of holders of the notes will be structurally subordinated to the claims of creditors of these non-guarantor subsidiaries, including trade creditors. Our non-guarantor subsidiaries accounted for $782.4 million, or 71%, and $407.0 million, or 70%, of our consolidated net sales (including intercompany sales) for the fiscal year ended January 1, 2011 and the six months ended July 2, 2011, respectively. Our non-guarantor subsidiaries accounted for $356.0 million, or 70%, of our property, plant and equipment, net as of July 2, 2011. Before intercompany eliminations with our non-guarantor subsidiaries, our non-guarantor subsidiaries accounted for $768.3 million, or 50.1%, of the combined Issuer, guarantor and non-guarantor subsidiaries total assets (including intercompany receivables with such non-guarantor subsidiaries, but excluding the value of such non-guarantor subsidiaries’ investments in our other subsidiaries) as of July 2, 2011. After intercompany eliminations, our non-guarantor subsidiaries accounted for $700.9 million, or 62.3%, of our consolidated total assets (excluding the value of such non-guarantor subsidiaries’ investments in our other subsidiaries) as of July 2, 2011. We and our guarantor subsidiaries hold $335.2 million of intercompany receivables due from our non-guarantor subsidiaries to facilitate cash repatriation from our non-guarantor subsidiaries to us. Our guarantor subsidiaries will also guarantee our ABL

Facility. All obligations of our non-guarantor subsidiaries will have to be satisfied before any of the assets of such subsidiaries would be available for distribution, upon a liquidation or otherwise, to us or a guarantor of the notes. The indenture governing the notes will permit these subsidiaries to incur certain additional debt and will not limit their ability to incur other liabilities that are not considered indebtedness under the indenture.

          Additionally, a significant portion of our domestic assets and the Notes Collateral is represented by intercompany receivables owed to us by our non-guarantor subsidiaries. In the event of a bankruptcy, liquidation, dissolution, reorganization or similar proceeding against us, the ability of holders of the notes to realize upon the Notes Collateral constituting intercompany receivables will be subject to, among other things, the applicable court’s determination of whether such intercompany receivables should be treated as debt (giving us a valid claim against our non-guarantor subsidiaries) or equity (in which case we would not hold a valid claim against our non-guarantor subsidiaries for payment of such intercompany receivable, which would instead be treated as an equity investment in such non-guarantor subsidiaries). Such determination would be based on, among other factors, whether the intercompany receivables would be treated as indebtedness under applicable law and whether the intercompany receivables bear the traditional earmarks of debt or whether they have any features more typical of an equity investment in a subsidiary. If the applicable court determines that the intercompany receivables should be recharacterized and treated as an equity investment, then creditors holding claims against our non-guarantor subsidiaries would have priority over the claim held by us on account of the intercompany receivables, and our ability to collect on the intercompany receivables may be compromised. Furthermore, to the extent the intercompany receivables are respected and treated as debt, the ability of the holders of the notes to realize upon the Notes Collateral will be subject to certain insolvency and bankruptcy law limitations, in addition to any limitations imposed by applicable law, including the law of jurisdiction of incorporation or organization of our non-guarantor subsidiaries that are organized outside of the U.S.

The Tranche 2 Sub-Facility will have priority in right of payment upon a foreclosure or a bankruptcy, insolvency or similar event and holders of notes will receive proceeds in respect of Notes Collateral only after the lenders under the Tranche 2 Sub-Facility have been paid in full.

          While both the notes and the indebtedness and other obligations under our Tranche 2 Sub-Facility will be secured by first-priority liens on the Notes Collateral, the Tranche 2 Sub-Facility will have priority in right of payment upon a foreclosure or a bankruptcy, insolvency or similar event and, therefore, holders of the notes will receive proceeds in respect of Notes Collateral only after the lenders under the Tranche 2 Sub-Facility have been paid in full. As a result, the claims of holders of the notes to such proceeds will effectively rank behind the claims, including interest, of the lenders under our Tranche 2 Sub-Facility. See “Description of Other Indebtedness — ABL Facility — Security” and “Description of Notes — Security for the Notes.” If the holders of the notes (or the trustee on their behalf) receive any proceeds as a result of an enforcement of security interests or the guarantees prior to the satisfaction of the claims under the Tranche 2 Sub-Facility, the holders of the notes (or the trustee on their behalf) will be required to turn over such proceeds until the claims under the Tranche 2 Sub-Facility are satisfied. Accordingly, the holders of the notes may recover less from the proceeds of an enforcement of interests in the Notes Collateral than the holders of the notes otherwise might have.

The imposition of certain permitted liens could materially and adversely affect the value of the Notes Collateral.

          The Notes Collateral is also subject to liens permitted under the terms of the indenture governing the notes and the credit agreement governing the ABL Facility, whether arising on or after the date the notes are issued. The existence of any permitted liens could materially adversely affect the value of the collateral that could be realized by the holders of the notes as well as the ability of the collateral agent to realize or foreclose on such collateral. The Notes Collateral may also secure future indebtedness and other obligations of ours on a pari passu first-priority basis to the extent permitted by the indenture and the security documents and as a result your rights to the collateral would be diluted by any increase in the indebtedness secured on a pari passu first-priority basis by the Notes Collateral.

State law may limit the ability of the collateral agent on behalf of the holders of the notes to foreclose on the real property and improvements included in the collateral.

          The notes are secured by, among other things, liens on real property and improvements located in various states in which the collateral real properties are located. The laws of those states may limit the ability of the collateral agent on behalf of the holders of the notes to foreclose on the improved real property collateral located in those states. Laws of those states govern the perfection, enforceability and foreclosure of mortgage liens against real property interests which secure debt obligations such as the notes. These laws may impose procedural requirements for foreclosure different from and necessitating a longer time period for completion than the requirements for foreclosure of security interests in personal property. Debtors may have the right to reinstate defaulted debt (even if it has been accelerated) before the foreclosure date by paying the past due amounts and a right of redemption after foreclosure. Governing laws may also impose security first and one form of action rules (such as California), which rules can affect the ability to foreclose or the timing of foreclosure on real and personal property collateral regardless of the location of the collateral and may limit the right to recover a deficiency following a foreclosure.

          You also may be limited in your ability to enforce the “no liens” and “no transfer or assignments” covenants. Some decisions in state courts have placed limits on a lender’s ability to prohibit and to accelerate the debt secured by real property upon breach of covenants prohibiting sales or assignments or the creation of certain junior liens, and the lender may need to demonstrate that enforcement of such covenants is reasonably necessary to protect against impairment of the lender’s security or to protect against an increased risk of default. Although the foregoing may have been preempted by certain federal laws, the scope of such preemption is uncertain.

Federal and state statutes may allow courts, under specific circumstances, to void the notes, the guarantees and the security interests, subordinate claims in respect of the notes, the guarantees and the security interests and/or require holders of the notes to return payments received from us.

          Under federal bankruptcy laws and comparable provisions of state fraudulent transfer laws, the notes, the guarantees and the security interests could be voided, or claims in respect of the notes, the guarantees and the security interests could be subordinated to all of our other debt, if the issuance of the notes, a guarantee or a grant of security was found to have been made for less than their reasonable equivalent value and we, at the time we incurred the indebtedness evidenced by the notes:

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were insolvent or rendered insolvent by reason of such indebtedness;

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were engaged in, or about to engage in, a business or transaction for which our remaining assets constituted unreasonably small capital; or

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intended to incur, or believed that we would incur, debts beyond our ability to repay such debts as they mature.

          A court might also void the issuance of the notes, a guaranty or grant of security, without regard to the above factors, if the court found that we issued the notes or the guarantors entered into their respective guaranty or security agreements with actual intent to hinder, delay or defraud our or their respective creditors.

          A court would likely find that we or a guarantor did not receive reasonably equivalent value or fair consideration for the notes or the guarantees and security agreements, respectively, if we or a guarantor did not substantially benefit directly or indirectly from the issuance of the notes. If a court were to void the issuance of the notes, the guarantees or the related security agreements, you would no longer have a claim against us or the guarantors or, in the case of the security agreements, a claim with respect to the related collateral. Sufficient funds to repay the notes may not be available from other sources, including the remaining guarantors, if any. In addition, the court might direct you to repay any amounts that you already received from us or the guarantors or, with respect to the notes, any guarantee or the collateral.

          In addition, any payment by us pursuant to the notes made at a time when we were subsequently found to be insolvent could be voided and required to be returned to us or to a fund for the benefit of our creditors if such

payment is made to an insider within a one-year period prior to a bankruptcy filing or within 90 days for any outside party and such payment would give the creditors more than such creditors would have received in a distribution under Title 11 of the United States Code, as amended (the “Bankruptcy Code”).

          The measures of insolvency for purposes of these fraudulent transfer laws will vary depending upon the law applied in any proceeding to determine whether a fraudulent transfer has occurred. Generally, however, we would be considered insolvent if:

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the sum of our debts, including contingent liabilities, were greater than the fair saleable value of all our assets;

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the present fair saleable value of our assets were less than the amount that would be required to pay our probable liability on existing debts, including contingent liabilities, as they become absolute and mature; or

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we could not pay our debts as they become due.

          In addition, although each guarantee will contain a provision intended to limit that guarantor’s liability to the maximum amount that it could incur without causing the incurrence of obligations under its guarantee to be a fraudulent transfer, this provision may not be effective to protect those guarantees from being voided under fraudulent transfer law, or may reduce that guarantor’s obligation to an amount that effectively makes its guarantee worthless.

          Finally, as a court of equity, the bankruptcy court may subordinate the claims in respect of the notes to other claims against us under the principle of equitable subordination, if the court determines that: (i) the holders of the notes engaged in some type of inequitable conduct; (ii) such inequitable conduct resulted in injury to our other creditors or conferred an unfair advantage upon the holder of the notes; and (iii) equitable subordination is not inconsistent with the provisions of the Bankruptcy Code.

Holders of the notes may not be able to fully realize the value of their liens.

          The security interests and liens for the benefit of holders of the notes may be released without such holders’ consent in specified circumstances. In particular, the security documents governing the notes and our ABL Facility generally provide for an automatic release of all liens on any asset securing our ABL Facility on a first-priority basis and that is disposed of in compliance with the provisions of the credit agreement governing our ABL Facility and the indenture governing the notes. As a result, we cannot assure holders of the notes that the notes will continue to be secured by a substantial portion of our assets. In addition, the capital stock of our subsidiaries will be excluded from the collateral to the extent liens thereon would trigger reporting obligations under Rule 3-16 of Regulation S-X, which requires financial statements from any company whose securities are collateral if its book value or market value, whichever is greater, would exceed 20% of the principal amount of the notes secured thereby.

          Moreover, the collateral agent may need to evaluate the impact of potential liabilities before determining to foreclose on collateral consisting of real property because secured creditors that hold a security interest in real property may be held liable under environmental laws for the costs of remediating or preventing the release or threatened release of hazardous substances at such real property. Consequently, the collateral agent may decline to foreclose on such collateral or exercise remedies available in respect thereof if it does not receive indemnification to its satisfaction from the holders of the notes.

          In addition, all or a portion of the collateral may be released:

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to enable the sale, transfer or other disposal of such collateral in a transaction not prohibited under the indenture governing the notes or the credit agreement governing the ABL Facility, including the sale of assets in accordance with the asset sale covenant in the indenture that will govern the notes and the sale of any entity in its entirety that owns or holds such collateral; and

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with respect to collateral held by a guarantor, upon the release of such guarantor from its guarantee.

          In addition, the guarantee of a subsidiary guarantor will be released in connection with a sale of such subsidiary guarantor in a transaction not prohibited by the indenture or upon certain other events described in the “Description of Notes.” See “Description of Notes — Repurchase at the Option of Holders — Asset Sales” and “Description of Notes — Security for the Notes — Release of Collateral.”

          The indenture also permits us to designate one or more of our restricted subsidiaries that is a guarantor of the notes as an unrestricted subsidiary. If we designate a subsidiary guarantor as an unrestricted subsidiary, all of the liens on any collateral owned by such subsidiary or any of its subsidiaries and any guarantees of the notes by such subsidiary or any of its subsidiaries will be released under the indenture. Designation of a subsidiary as unrestricted will reduce the aggregate value of the collateral securing the notes to the extent that liens on the assets of the unrestricted subsidiary and its subsidiaries are released. In addition, the creditors of the unrestricted subsidiary and its subsidiaries will have a senior claim on the assets of such unrestricted subsidiary and its subsidiaries.

The collateral may not be valuable enough to satisfy all the obligations secured by such collateral.

          The notes are secured on a first-priority lien basis (subject to certain exceptions and permitted liens) by substantially all of our and the guarantors’ assets (other than accounts receivable, inventory and cash and proceeds and products of the foregoing and certain assets related thereto securing our ABL Facility on a first-priority lien basis (the “ABL Collateral”)) (the “Notes Collateral”) and such collateral may be shared in certain circumstances with our future creditors. The actual value of the Notes Collateral at any time will depend upon market and other economic conditions. As of July 2, 2011, the book value of the Notes Collateral (other than capital stock of the Issuer and Restricted Subsidiaries) was approximately $674.5 million.

          The notes are also secured on a second-priority lien basis (subject to certain exceptions and permitted liens) by the ABL Collateral. The ABL Collateral is subject to a first-priority security interest for the benefit of the lenders under our ABL Facility, and may be shared with our future creditors. Although the holders of obligations secured by first-priority liens on the ABL Collateral and the holders of obligations secured by second-priority liens on the ABL Collateral, including the notes, will share in the proceeds of the ABL Collateral, the holders of obligations secured by first-priority liens in the ABL Collateral will be entitled to receive proceeds from any realization of the ABL Collateral to repay the obligations held by them in full before the holders of the notes and the holders of other obligations secured by second-priority liens in the ABL Collateral receive any such proceeds.

          In addition, the asset sale covenant and the definition of asset sale in the indenture governing the notes have a number of significant exceptions pursuant to which we will be able to sell Notes Collateral without being required to reinvest the proceeds of such sale into assets that will comprise Notes Collateral or to make an offer to the holders of the notes to repurchase the notes.

          As of July 2, 2011, we had $560.0 million of indebtedness outstanding under the notes and no indebtedness outstanding under our ABL Facility, with approximately $29.2 million of additional availability under our ABL Facility (subject to availability under a borrowing base and after giving effect to $10.8 million of outstanding letters of credit) as of July 2, 2011. All indebtedness under our ABL Facility will be secured by first-priority liens on the ABL Collateral (subject to certain exceptions). In addition, under the terms of the indenture governing the notes, we may grant certain additional liens on any property or asset that constitutes ABL Collateral. Any grant of additional liens on the ABL Collateral would further dilute the value of the second-priority lien on the ABL Collateral securing the notes. Further, as described above, we will be permitted under the terms of the indenture governing the notes to sell all assets that constitute ABL Collateral and not apply the proceeds to invest in additional assets that will secure the notes or repay outstanding indebtedness.

          The value of the pledged assets in the event of a liquidation will depend upon market and economic conditions, the availability of buyers and similar factors. No independent appraisals of any of the pledged property were prepared by or on behalf of us in connection with the offering of the notes. Accordingly, we cannot assure holders of the notes that the proceeds of any sale of the pledged assets following an acceleration to maturity with respect to the notes would be sufficient to satisfy, or would not be substantially less than, amounts due on the notes

and the other debt secured thereby. If the proceeds of any sale of the pledged assets were not sufficient to repay all amounts due on the notes, the holders of the notes (to the extent their notes were not repaid from the proceeds of the sale of the pledged assets) would have only an unsecured claim against our remaining assets. By their nature, some or all of the pledged assets may be illiquid and may have no readily ascertainable market value. Likewise, we cannot assure holders of the notes that the pledged assets will be saleable or, if saleable, that there will not be substantial delays in their liquidation. To the extent that liens, rights and easements granted to third parties encumber assets located on property owned by us or constitute subordinate liens on the pledged assets, those third parties may have or may exercise rights and remedies with respect to the property subject to such encumbrances (including rights to require marshalling of assets) that could adversely affect the value of the pledged assets located at that site and the ability of the collateral agent to realize or foreclose on the pledged assets at that site.

          In addition, the indenture governing the notes permits us to issue additional secured debt, including debt secured equally and ratably by the same assets pledged for the benefit of the holders of the notes. This could reduce amounts payable to holders of the notes from the proceeds of any sale of the collateral.

          Additionally, a significant portion of our domestic assets and the Notes Collateral is represented by intercompany receivables owed to us by our non-guarantor subsidiaries. In the event of a bankruptcy, liquidation, dissolution, reorganization or similar proceeding against us, the ability of holders of the notes to realize upon the Notes Collateral constituting intercompany receivables will be subject to, among other things, the applicable court’s determination of whether such intercompany receivables should be treated as debt (giving us a valid claim against our non-guarantor subsidiaries) or equity (in which case we would not hold a valid claim against our non-guarantor subsidiaries for payment of such intercompany receivable, which would instead be treated as an equity investment in such non-guarantor subsidiaries). Such determination would be based on, among other factors, whether the intercompany receivables would be treated as indebtedness under applicable law and whether the intercompany receivables bear the traditional earmarks of debt or whether they have any features more typical of an equity investment in a subsidiary. If the applicable court determines that the intercompany receivables should be recharacterized and treated as an equity investment, then creditors holding claims against our non-guarantor subsidiaries would have priority over the claim held by us on account of the intercompany receivables, and our ability to collect on the intercompany receivables may be compromised. Furthermore, to the extent the intercompany receivables are respected and treated as debt, the ability of the holders of the notes to realize upon the Notes Collateral will be subject to certain insolvency and bankruptcy law limitations, in addition to any limitations imposed by applicable law, including the law of jurisdiction of incorporation or organization of our non-guarantor subsidiaries that are organized outside of the U.S.

The rights of holders of the notes with respect to the ABL collateral will be substantially limited by the terms of the intercreditor agreement.

          Under the terms of the intercreditor agreement which was entered into in connection with our ABL Facility, at any time that obligations that have the benefit of the first-priority liens on the ABL Collateral are outstanding, any actions that may be taken in respect of the ABL Collateral, including the ability to cause the commencement of enforcement proceedings against the ABL Collateral and to control the conduct of such proceedings, and the approval of amendments to, releases of ABL Collateral from the lien of, and waivers of past defaults under, the security documents, will be at the direction of the holders of the obligations secured by the first-priority liens. Neither the trustee nor the collateral agent, on behalf of the holders of the notes, will have the ability to control or direct such actions, even if the rights of the holders of the notes are adversely affected, subject to certain exceptions. See “Description of Notes — Security for the Notes” and “Description of Notes — Amendment, Supplement and Waiver.” Under the terms of the intercreditor agreement, at any time that obligations that have the benefit of the first-priority liens on the ABL Collateral are outstanding, if the holders of such indebtedness release the ABL Collateral for any reason whatsoever, including, without limitation, in connection with any sale of assets, the second-priority security interest in such ABL Collateral securing the notes will be automatically and simultaneously released without any consent or action by the holders of the notes, subject to certain exceptions. The ABL Collateral so released will no longer secure our and the guarantors’ obligations under the notes. In addition, because the holders of the indebtedness secured by first-priority liens in the ABL Collateral control the disposition of the ABL Collateral, such holders could decide not to proceed against the ABL Collateral, regardless of whether there is a default under the documents governing such indebtedness or under the indenture governing the notes. In such event, the only remedy available to the holders of the notes would be to sue for payment on the notes and the related

guarantees under the indenture. In addition, the intercreditor agreement gives the holders of first-priority liens on the ABL Collateral the right to access and use the collateral that secures the notes to allow those holders to protect the ABL Collateral and to process, store and dispose of the ABL Collateral.

The value of the collateral securing the notes may not be sufficient to secure post-petition interest.

          In the event of a bankruptcy, liquidation, dissolution, reorganization or similar proceeding against us, holders of the notes will only be entitled to post-petition interest under the Bankruptcy Code to the extent that the value of their security interest in the collateral is greater than their pre-bankruptcy claim. Holders of the notes that have a security interest in collateral with a value equal or less than their pre-bankruptcy claim will not be entitled to post-petition interest under the Bankruptcy Code. No appraisals of the fair market value of the collateral were prepared in connection with the offering and we therefore cannot assure you that the value of the noteholders’ interest in the collateral equals or exceeds the principal amount of the notes. See “— The collateral may not be valuable enough to satisfy all the obligations secured by such collateral.”

The waiver in the intercreditor agreement of rights of marshaling may adversely affect the recovery rates of holders of the notes in a bankruptcy or foreclosure scenario.

          The notes and the guarantees are secured on a second-priority lien basis by the ABL Collateral. The intercreditor agreement provides that, at any time that obligations that have the benefit of the first-priority liens on the ABL Collateral are outstanding, the holders of the notes, the trustee under the indenture governing the notes and the collateral agent for the notes may not assert or enforce any right of marshaling accorded to a junior lienholder, as against the holders of such indebtedness secured by first-priority liens in the ABL Collateral. Without this waiver of the right of marshaling, holders of such indebtedness secured by first-priority liens in the ABL Collateral would likely be required to liquidate collateral on which the notes did not have a lien, if any, prior to liquidating the ABL Collateral, thereby maximizing the proceeds of the ABL Collateral that would be available to repay our obligations under the notes. As a result of this waiver, the proceeds of sales of the ABL Collateral could be applied to repay any indebtedness secured by first-priority liens in the ABL Collateral before applying proceeds of the sale of other collateral securing indebtedness, and the holders of the notes may recover less than they would have if such proceeds were applied in the order most favorable to the holders of the notes.

Certain significant assets will be excluded from the collateral.

               Certain assets are excluded from the collateral securing the notes as described under “Description of Notes — Security for the Notes” including, among other things, any assets held by foreign and unrestricted subsidiaries, any assets in real property (including leaseholds) other than fee interests having a value in excess of certain amounts, as well as other exclusions. In addition, the collateral will not include any capital stock of a subsidiary of the Issuer, to the extent that the pledge of such capital stock results in our being required to file separate financial statements of such subsidiary with the SEC, and any such capital stock that triggers such a requirement to file financial statements of such subsidiary of the Issuer with the SEC would be automatically released from the collateral. The value of this excluded collateral is significant and in certain circumstances may be pledged to other lenders. Additionally, we are not required to create or perfect liens in assets where we reasonably determine that such creation or perfection would be considered excessive in view of the benefits obtained therefrom by the holders of the notes (including material adverse tax consequences). See “Description of Notes — Security for the Notes.”

We will in most cases have control over the collateral, and the sale of particular assets by us could reduce the pool of assets securing the notes and the guarantees.

          The collateral documents allow us to remain in possession of, retain exclusive control over, freely operate, and collect, invest and dispose of any income from, the collateral securing the notes and the guarantees. In addition, we will not be required to comply with all or any portion of Section 314(d) of the Trust Indenture Act of 1939, as amended (the “Trust Indenture Act”) if we determine, in good faith based on advice of counsel, that, under the terms of that Section and/or any interpretation or guidance as to the meaning thereof of the SEC and its staff, including “no action” letters or exemptive orders, all or such portion of Section 314(d) of the Trust Indenture Act is inapplicable to the released collateral. For example, so long as no default or event of default under the indenture would result therefrom and such transaction would not violate the Trust Indenture Act, we may, among other things, without any

release or consent by the applicable trustee, conduct ordinary course activities with respect to collateral, such as selling, factoring, abandoning or otherwise disposing of collateral and making ordinary course cash payments (including repayments of indebtedness). With respect to such releases, we must deliver to the collateral agent, from time to time, an officers’ certificate to the effect that all releases and withdrawals during the preceding six-month period in which no release or consent of the collateral agent was obtained in the ordinary course of our business were not prohibited by the indenture.

In the event of a bankruptcy of us or any of the guarantors, holders of the notes may be deemed to have an unsecured claim to the extent that our obligations in respect of the notes exceed the fair market value of the collateral securing the notes.

          In any bankruptcy proceeding with respect to us or any of the guarantors, it is possible that the bankruptcy trustee, the debtor-in-possession or competing creditors will assert that the fair market value of the collateral with respect to the notes on the date of the bankruptcy filing was less than the then-current principal amount of the notes. Upon a finding by the bankruptcy court that the notes are under-collateralized, the claims in the bankruptcy proceeding with respect to the notes would be bifurcated between a secured claim and an unsecured claim, and the unsecured claim would not be entitled to the benefits of security in the collateral. Other consequences of a finding of under-collateralization would be, among other things, a lack of entitlement on the part of the notes to receive post-petition interest and a lack of entitlement on the part of the unsecured portion of the notes to receive other “adequate protection” under federal bankruptcy laws. In addition, if any payments of post-petition interest had been made at the time of such a finding of under-collateralization, those payments could be recharacterized by the bankruptcy court as a reduction of the principal amount of the secured claim with respect to the notes.

Because each guarantor’s liability under its guarantees may be reduced to zero, avoided or released under certain circumstances, holders of the notes may not receive any payments from some or all of the guarantors.

          Holders of the notes have the benefit of the guarantees of the guarantors. However, the guarantees by the guarantors are limited to the maximum amount that the guarantors are permitted to guarantee under applicable law. As a result, a guarantor’s liability under its guarantee could be reduced to zero, depending upon the amount of other obligations of such guarantor. Further, under the circumstances discussed more fully above, a court under federal and state fraudulent conveyance and transfer statutes could void the obligations under a guarantee or further subordinate it to all other obligations of the guarantor. See “— Federal and state statutes may allow courts, under specific circumstances, to void the notes, the guarantees and the security interests, subordinate claims in respect of the notes, the guarantees and the security interests and/or require holders of the notes to return payments received from us.” In addition, you will lose the benefit of a particular guarantee if it is released under certain circumstances described under “Description of Notes — Guarantees.”

Bankruptcy laws may limit the ability of holders of the notes to realize value from the collateral.

               The right of the collateral agent to repossess and dispose of the pledged assets upon the occurrence of an event of default under the indenture governing the notes is likely to be significantly impaired by applicable bankruptcy law if a bankruptcy case were to be commenced by or against us before the collateral agent repossessed and disposed of the pledged assets. For example, under the Bankruptcy Code, pursuant to the automatic stay imposed upon the bankruptcy filing, a secured creditor is prohibited from repossessing its security from a debtor in a bankruptcy case, or from disposing of security repossessed from such debtor or creating, perfecting or enforcing any lien against a debtor, or taking other actions to levy against a debtor, without bankruptcy court approval. Moreover, the Bankruptcy Code permits the debtor to continue to retain and to use collateral (including cash collateral) and to provide liens senior to the lien of the collateral agent in respect of the notes to secure indebtedness incurred after the commencement of a bankruptcy case even though the debtor is in default under the applicable debt instruments, provided that the secured creditor is given “adequate protection.” The meaning of the term “adequate protection” may vary according to circumstances (and is within the discretion of the bankruptcy court), but it is intended in general to protect the value of the secured creditor’s interest in the collateral and may include cash payments or the granting of additional security, if and at such times as the court in its discretion determines, for any diminution in the value of the collateral as a result of the automatic stay of repossession or disposition or any use of the collateral by the debtor during the pendency of the bankruptcy case. Generally, adequate protection payments, in the form of interest or otherwise, are not required to be paid by a debtor to a secured creditor unless the bankruptcy court

determines that the value of the secured creditor’s interest in the collateral is declining during the pendency of the bankruptcy case. In addition, the bankruptcy court may determine not to provide cash payments as adequate protection to the holders of the notes if, among other possible reasons, the bankruptcy court determines that the fair market value of the collateral with respect to the notes on the date of the bankruptcy filing was less than the then-current principal amount of the notes. Furthermore, due to the imposition of the automatic stay, the lack of a precise definition of the term “adequate protection” and the broad discretionary powers of a bankruptcy court, it is impossible to predict (1) how long payments under the notes could be delayed following commencement of a bankruptcy case, (2) whether or when the collateral agent could repossess or dispose of the pledged assets or (3) whether or to what extent holders of the notes would be compensated for any delay in payment or loss of value of the pledged assets through the requirement of “adequate protection.”

The collateral is subject to casualty risks.

          We are obligated under our ABL Facility to at all times cause all the pledged assets to be properly insured and kept insured against loss or damage by fire or other hazards to the extent that such properties are usually insured by corporations operating in the same or similar business. There are, however, some losses, including losses resulting from terrorist acts, that may be either uninsurable or not economically insurable, in whole or in part. As a result, we cannot assure holders of the notes that the insurance proceeds will compensate us fully for our losses. If there is a total or partial loss of any of the pledged assets, we cannot assure holders of the notes that the proceeds received by us in respect thereof will be sufficient to satisfy all the secured obligations, including the notes.

          In the event of a total or partial loss to any of the mortgaged facilities, certain items of equipment and inventory may not be easily replaced. Accordingly, even though there may be insurance coverage, the extended period needed to manufacture replacement units or inventory could cause significant delays.

Rights of holders of the notes in the collateral may be adversely affected by the failure to perfect security interests in the collateral.

          Applicable law requires that a security interest in certain tangible and intangible assets can only be properly perfected and its priority retained through certain actions undertaken by the secured party. The liens in the collateral securing the notes may not be perfected with respect to the claims of the notes if the collateral agent is not able to take the actions necessary to perfect any of these liens on or prior to the Issue Date.

          In addition, applicable law requires that certain property and rights acquired after the grant of a general security interest, such as real property, equipment subject to a certificate of title and certain proceeds, can only be perfected at the time such property and rights are acquired and identified. We and the guarantors have limited obligations to perfect the security interest of the holders of the notes in specified collateral. There can be no assurance that the trustee or the collateral agent for the notes will monitor, or that we will inform such trustee or collateral agent of, the future acquisition of property and rights that constitute collateral, and that the necessary action will be taken to properly perfect the security interest in such after-acquired collateral. Neither the trustee nor the collateral agent for the notes has an obligation to monitor the acquisition of additional property or rights that constitute collateral or the perfection of any security interest. Such failure may result in the loss of the security interest in the collateral or the priority of the security interest in favor of the notes against third parties.

          If the Issuer or any guarantor were to become subject to a bankruptcy proceeding, any liens recorded or perfected or any mortgages delivered after the Issue Date would face a greater risk of being invalidated than if they had been recorded, perfected or delivered on the Issue Date. Liens recorded or perfected or any mortgages delivered after the Issue Date may be treated under bankruptcy law as if they were delivered to secure previously existing indebtedness. In bankruptcy proceedings commenced within 90 days of lien perfection or mortgage delivery, a lien or mortgage given to secure previously existing debt is significantly more likely to be avoided as a preference by the bankruptcy court than if delivered and promptly recorded on the Issue Date. Accordingly, if the Issuer or a guarantor were to file for bankruptcy protection after the Issue Date and the liens had been perfected or the mortgages had been delivered less than 90 days before commencement of such bankruptcy proceeding, or not yet perfected or delivered at all, the liens or mortgages securing the notes may be especially subject to challenge as a result of having not been perfected or delivered before the Issue Date. To the extent that such challenge succeeded, you would lose the benefit of the security that the collateral was intended to provide.

Pledges of equity interests in our foreign subsidiaries may not be enforceable under the laws of the jurisdictions where such foreign subsidiaries are organized.

          Part of the security for the repayment of the notes consists of a pledge of the capital stock of or equity interests in certain foreign subsidiaries (with capital stock of such foreign subsidiaries capped at 65%). Although such pledges are granted under security documents governed by U.S. law, some foreign jurisdictions may not recognize such security interests as enforceable. Consequently, the collateral agent may be unable to exercise remedies against the equity interests in foreign subsidiaries.

We may not be able to finance a change of control offer required by the indenture.

          Upon a change of control, as defined under the indenture governing the notes, you will have the right to require us to offer to purchase all of the notes then outstanding at a price equal to 101% of the principal amount of the notes, plus accrued interest. In order to obtain sufficient funds to pay the purchase price of the outstanding notes, we expect that we would have to refinance the notes. We cannot assure you that we would be able to refinance the notes on reasonable terms, if at all. Our failure to offer to purchase all outstanding notes or to purchase all validly tendered notes would be an event of default under the indenture. Such an event of default may cause the acceleration of our other debt, including debt under our ABL Facility. Our future debt also may contain restrictions on repayment requirements with respect to specified events or transactions that constitute a change of control under the indenture.

          Certain important corporate events, such as leveraged recapitalizations, may not, under the indenture governing the notes, constitute a “change of control” that would require us to repurchase the notes, notwithstanding the fact that such corporate events could increase the level of our indebtedness or otherwise adversely affect our capital structure, credit ratings or the value of the notes. In addition, the definition of change of control in the indenture governing the notes includes a phrase relating to the sale of “all or substantially all” of our assets. There is no precise established definition of the phrase “substantially all” under applicable law. Accordingly, the ability of a holder of notes to require us to repurchase its notes as a result of a sale of less than all our assets to another person may be uncertain. See “Description of Notes — Repurchase at the Option of Holders — Change of Control.”

A lowering or withdrawal of the ratings assigned to our debt securities by rating agencies may adversely affect the market price or liquidity of the notes.

          Our debt currently has a non-investment grade rating, and there can be no assurances that any rating assigned will remain for any given period of time or that a rating will not be lowered or withdrawn entirely by a rating agency if, in that rating agency’s judgment, future circumstances relating to the basis of the rating, such as adverse changes, so warrant. Credit ratings are not recommendations to purchase, hold or sell the notes, and may be revised or withdrawn at any time. Additionally, credit ratings may not reflect the potential effect of risks relating to the structure or marketing of the notes. If any credit rating initially assigned to the notes is subsequently lowered or withdrawn for any reason, you may not be able to resell your notes without a substantial discount.

If the notes are rated investment grade by both Standard & Poor’s and Moody’s, certain covenants contained in the indenture will be suspended, and holders of the notes will lose the protection of these covenants unless and until the notes subsequently fall back below investment grade.

          The indenture contains certain covenants that will be suspended for so long as the notes are rated investment grade by both Standard & Poor’s and Moody’s Investors Service, Inc. These covenants restrict the Issuer and its restricted subsidiaries’ ability to, among other things:

•

incur additional indebtedness or issue preferred stock;

•

make distributions or other restricted payments;

•

sell capital stock or other assets;

•

engage in transaction with affiliates; and

•

designate our subsidiaries as unrestricted subsidiaries.

          Because these restrictions will not apply when the notes are rated investment grade, we will be able to incur additional debt and consummate transactions that may impair our ability to satisfy our obligations with respect to the notes. In addition, we will not have to make certain offers to repurchase the notes.

THE TRANSACTIONS

The Transactions

          On October 4, 2010, Polymer Group, Merger Sub, Parent and MatlinPatterson Global Opportunities Partners L.P. entered into the Merger Agreement, pursuant to which Merger Sub merged with and into Polymer Group, with Polymer Group being the surviving corporation following the Merger. As a result of the Merger, the Investor Group, through the ownership of Holdings, beneficially owns all of the issued and outstanding capital stock of Polymer Group. A portion of the aggregate merger consideration totaling $64.5 million, subject to adjustment as provided in the Merger Agreement, or approximately $2.91 per share (calculated on a fully diluted basis), were deposited in an escrow fund to cover liabilities, costs and expenses related to the application of the personal holding company (“PHC”) rules of the Internal Revenue Code of 1986, as amended (the “Code”), to Polymer Group and its subsidiaries in periods prior to the effective time of the Merger. As described below and in “Management” and “Certain Relationships and Related Party Transactions — Shareholders Agreement” the management investors made investments in Holdings. In connection with the Transactions, the management investors received options to acquire shares of Holdings. Blackstone and the management investors invested $259.9 million in equity of Holdings. The Merger, the equity investment by the Investor Group, the entering into the ABL Facility, the offering of the notes, the repayment of certain existing indebtedness of Polymer Group and the payment of related fees and expenses are collectively referred to in this prospectus as the “Transactions.”

          In addition to the Merger Agreement, the parties entered into various ancillary agreements governing relationships between the parties after the Merger. See “Certain Relationships and Related Party Transactions.”

          As a result of the Transactions, Parent owns all of the issued and outstanding common stock of Polymer Group. See “Prospectus Summary — The Transactions” and “Security Ownership of Principal Stockholders and Management.”

          The following financing transactions occurred in connection with the closing of the Merger:

•

an investment made by Blackstone and the management investors totaling $259.9 million in equity of Holdings;

•

the entering into the ABL Facility; and

•

the issuance of the notes.

          On the closing date of the Merger, we terminated all commitments and repaid all outstanding borrowings under our senior secured credit facilities (the “old credit facilities”). In addition, we repaid our Mexico Credit Facility and a portion of existing indebtedness under our Argentine Facilities in connection with the Transactions. We repaid the Argentine peso-denominated loans soon after the closing of the Transactions. See “Use of Proceeds” and “Description of Other Indebtedness.”

          We completed the final phase of the Spain Business Acquisition on January 28, 2011, which included repayment of approximately $34.8 million of outstanding debt of Tesalca-Texnovo and issuance of 393,675 new shares of our common stock to Tesalca-Texnovo owners, in conjunction with the closing of the Transactions. Additionally, we completed the China Noncontrolling Interest Acquisition for a purchase price of $7.2 million in the first quarter of 2011.

USE OF PROCEEDS

          We will not receive any proceeds from the issuance of the exchange notes in the exchange offer. The exchange offer is intended to satisfy our obligations under the registration rights agreement that we entered into in connection with the private offering of the outstanding notes. As consideration for issuing the exchange notes as contemplated in this prospectus, we will receive in exchange a like principal amount of outstanding notes, the terms of which are identical in all material respects to the exchange notes, except that the exchange notes will not contain terms with respect to transfer restrictions or additional interest upon a failure to fulfill certain of our obligations under the registration rights agreement. The outstanding notes that are surrendered in exchange for the exchange notes will be retired and cancelled and cannot be reissued. As a result, the issuance of the exchange notes will not result in any change in our capitalization.

CAPITALIZATION

          The following table sets forth our consolidated cash and cash equivalents and capitalization as of July 2, 2011.

          You should read this table in conjunction with “Prospectus Summary—Summary Historical Financial Information,” “Use of Proceeds,” “Selected Historical Consolidated Financial Data,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our historical consolidated financial statements and the related notes thereto included elsewhere in this prospectus.

•

our Argentine facilities entered into by our Argentina subsidiary, consisting of short-term credit facilities to finance working capital requirements, under which $3.0 million of indebtedness is currently outstanding, and a long-term facility under which $17.3 million (with a $16.7 million carrying value) of indebtedness are currently outstanding;

•

our China Facility entered into by our Suzhou, China subsidiary, under which $17.0 million of indebtedness was outstanding as of July 2, 2011. We borrowed an additional $3.0 million of indebtedness under this facility in the third quarter of 2011; and

•

$0.3 million of capital leases and $0.3 million of other short-term borrowings.

UNAUDITED PRO FORMA FINANCIAL INFORMATION

          The following unaudited pro forma financial information is based on our audited and unaudited financial statements included in this prospectus, as adjusted to illustrate the estimated pro forma effects of the Transactions and certain acquisitions (including the preliminary application of purchase accounting). The unaudited pro forma financial information should be read in conjunction with our financial statements and related notes and other financial information appearing elsewhere in this prospectus, including under “The Transactions” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

          The unaudited pro forma financial information gives effect to the Transactions and the China Noncontrolling Interest Acquisition, as if they had occurred on January 3, 2010 for purposes of the unaudited pro forma condensed statements of operations.

          The unaudited pro forma financial information also gives effect to the completion of the final phase of the Spain Business Acquisition as if it had occurred on December 2, 2009, the date we completed the initial phase of the acquisition, for purposes of the unaudited pro forma condensed statements of operations. We completed the final phase of the Spain Business Acquisition in conjunction with the closing of the Transactions. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Recent Transactions and Events — Business Acquisitions and Divestitures — Spain Business Acquisition.”

          The unaudited pro forma financial information is for illustrative and informational purposes only and does not purport to represent or be indicative of what our financial condition or results of operations would have been had the Transactions and the acquisitions described above occurred on such dates. The unaudited pro forma financial information should not be considered representative of our future financial condition or results of operations.

          The Merger was accounted for under the purchase method of accounting in accordance with ASC 805. Under purchase accounting, fixed assets and identifiable intangible assets acquired and liabilities assumed are recorded at their respective fair values. We are in the process of completing valuations of certain assets. Thus, the allocation of the purchase price to our assets is subject to adjustment.

See accompanying notes.

Unaudited Pro Forma Condensed Statements of Operations
Six Months Ended July 2, 2011

		Historical
		Predecessor One				Successor Five								Pro Forma Six
		Month Ended				Months Ended								Months Ended
		January 28, 2011				July 2, 2011				Adjustments				July 2, 2011
						(dollars in millions)
Net sales		$	84.6			$	495.7			$				$	580.3
Cost of goods sold			68.5				425.0				(19.5	)(a)			474.0
Gross profit			16.1				70.7				19.5				106.3
Selling, general and administrative expenses			11.6				62.3				0.5	(a)			74.4
Special charges, net			20.8				34.8				(44.3	)(b)			11.3
Other operating (income) loss, net			(0.6	)			1.0								0.4
Operating income (loss)			(15.7	)			(27.4	)			63.3				20.2
Other expense (income):
Interest expense, net			1.9				20.7				1.7	(c)			24.3
Foreign currency and other loss (gain), net			0.2				1.2				(0.3	)(d)			1.1
Income (loss) before income tax expense and discontinued operations			(17.8	)			(49.3	)			61.9				(5.2	)
Income tax expense			0.5				(1.7	)			0.1	(e)			(1.1	)
Income (loss) from continuing operations		$	(18.3	)		$	(47.6	)		$	61.8			$	(4.1	)

See accompanying notes.

Notes to Unaudited Pro Forma Condensed Statements of Operations

(a)

Reflects the following pro forma adjustments:

The above pro forma adjustments are reflected as follows:

(b)

Reflects the following pro forma adjustments:

(c)

Reflects pro forma interest expense resulting from our new capital structure as follows:

      Interest Rate Sensitivity

As of July 2, 2011, the ABL Facility was undrawn. The actual amounts of borrowings under the ABL Facility will fluctuate from time to time and will be subject to borrowing base availability, which would be reduced by certain outstanding letters of credit. Borrowings under the ABL Facility bear interest at variable rates. If the ABL Facility were fully drawn, based on an assumed interest rate of 4.0%, our annual interest payments on the ABL Facility would have been $2.0 million. A 0.125% change in interest rates would increase or decrease annual interest expense on the ABL Facility by less than $0.1 million.

(d)

Reflects changes in the value of the tax indemnification asset associated with the potential application of the PHC rules. Income tax expense (benefit) resulting from changes in the recorded tax liability for the potential application of the PHC rules, for which we will have indemnification from the selling shareholders, is offset by an equal amount of income (expense) relating to the tax indemnification asset, which is recorded in Foreign currency and other loss (gain), net.

(e)

Reflects pro forma income tax expense (benefit) applicable to the pro forma adjustments based on the respective jurisdictions to which the pro forma adjustments pertain and the associated applicable statutory tax rates, after taking into consideration the impact of changes in our valuation allowance.

SELECTED HISTORICAL CONSOLIDATED FINANCIAL INFORMATION

           The following selected historical consolidated financial information and other data set forth below should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our historical consolidated financial statements and the related notes thereto contained elsewhere in this prospectus.

          The selected historical consolidated statement of operations data, cash flow data and other financial data presented below for the fiscal years ended January 3, 2009, January 2, 2010 and January 1, 2011, and the selected consolidated balance sheet data as of January 2, 2010 and January 1, 2011 have been derived from our audited consolidated financial statements included in this prospectus. The selected historical consolidated statement of operations data, cash flow data and other financial data presented below for the fiscal years ended December 30, 2006 and December 29, 2007 and the selected consolidated balance sheet data as of December 30, 2006, December 29, 2007 have been derived from our unaudited consolidated financial statements which are not included in this prospectus and have been prepared on the same basis as the audited consolidated financial statements included in this prospectus. The selected historical consolidated financial and other data presented below for, and as of the end of, the six month period ended July 3, 2010, for the one month period ended January 28, 2011 and for the five month period ended July 2, 2011, have been derived from our unaudited condensed consolidated financial statements included in this prospectus and have been prepared on the same basis as the audited consolidated financial statements. Operating results for the one month period ended January 28, 2011 and the five month period ended July 2, 2011 are not necessarily indicative of the results that may be expected for the year ending December 31, 2011.

          The fiscal year ended January 3, 2009 included the results of operations for a fifty-three week period. Other fiscal years presented below included fifty-two weeks.