Document:

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                                                                     EXHIBIT 4.3

                             JOINT VENTURE AGREEMENT

                                     Between

                           DSG International Limited,

                             Mitsubishi Corporation,

                                       And

                      Japan Absorbent Technology Institute

                                February 10, 2003

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CONTENTS

                                                                            Page
                                                                            ----

ARTICLE  1  : Definition                                                      2

ARTICLE  2  : Representation and Warranties                                   3

ARTICLE  3  : Establishment of New Companies                                  3

ARTICLE  4  : Issue of Shares                                                 5

ARTICLE  5  : General Meeting of Shareholders                                 5

ARTICLE  6  : Board of Directors                                              7

ARTICLE  7  : Transfer of Shares                                              9

ARTICLE  8  : Financing                                                      11

ARTICLE  9  : Remittance of Dividends                                        12

ARTICLE 10  : Accounting                                                     13

ARTICLE 11  : Auditors                                                       13

ARTICLE 12  : License                                                        14

ARTICLE 13  : Supply of Raw Materials                                        14

ARTICLE 14  : Sales of Products                                              14

ARTICLE 15  : Governmental Approval and Term                                 15

ARTICLE 16  : Termination                                                    15

ARTICLE 17  : Notice                                                         18

ARTICLE 18  : Governing Law                                                  19

ARTICLE 19  : Language                                                       19

ARTICLE 20  : Non-Assignment                                                 19

ARTICLE 21  : Entire Agreement                                               19

ARTICLE 22  : Settlement of Dispute                                          19

ARTICLE 23  : Secrecy Provisions                                             20

ARTICLE 24  : Priority of Joint Venture Agreement                            20

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                             JOINT VENTURE AGREEMENT

This Agreement, made and entered into this 10th day of February, 2003, by and
between Japan Absorbent Technology Institute, a corporation duly organized and
existing under the laws of Japan and having its principal place of business at
26-5, Nihonbashi-hamacho 2-chome, Chuo-ku, Tokyo, Japan (herein after called
"JATI"), MITSUBISHI CORPORATION, a corporation duly organized and existing under
the laws of Japan and having its principal place of business at 6-3, Marunouchi
2-chome, Chiyoda ku, Tokyo, Japan (hereinafter called "MC", MC and JATI
hereinafter sometimes collectively called the "Japanese Shareholders"), and DSG
International Limited., a corporation duly organized and existing under the laws
of British Virgin Islands and having its principal executive office at 17th
Floor, Watson Centre, Kung Yip Street, Kwai Chung, Hong Kong (hereinafter called
"DSG"),

                                   WITNESSETH:

WHEREAS, JATI has developed and owns certain valuable and proprietary patents,
and related technical information, trademarks, and other intellectual property
rights, for the manufacture of the Products (as hereinafter defined),

WHEREAS, MC has received a license under the Patents (hereinafter defined) and
Technical Information (as hereinafter defined) from JATI and has granted such a
license to DSG, and desires to sell raw materials for the Products as a supplier
and to purchase and sell a certain quantity of the Products manufactured by
SSC (as hereinafter defined).

WHEREAS, DSG is engaged in manufacture of absorbent products such as disposable
baby and incontinent diapers, feminine hygiene products and the like, in Hong
Kong, China and other areas, and desires to manufacture the End Products (as
hereinafter defined) by using the Products, and

WHEREAS, the parties hereto (hereinafter individually called the "Party", and
hereinafter collectively called the "Parties") desire (a) to establish a new
company under the laws of British Virgin Island as a holding company
(hereinafter called "SHC"), (b) to cause SHC to issue such number of shares to
the Parties so that they will hold shares in SHC in the ratio stated in Article
3.01 hereof, and (c) to cause SHC to invest in and establish (i) a new company
under the laws of People's Republic of China as a production company in
Waigaoqiao Free Trade Zone, People's Republic of China in order to manufacture
the Products (hereinafter called "SSC") and (ii) a new company under the laws
of Macau as a

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marketing company in Macau in order to sell the Products (hereinafter called
"SMC").

NOW THEREFORE, it is agreed by all the Parties as hereinafter set forth:

ARTICLE 1. Definition

Whenever used in this Agreement, unless otherwise clearly indicated in the
context, the following terms shall have only the meanings as defined in this
Article 1:

1.01 "End Products" means absorbent products such as disposable baby and
     incontinent diapers and feminine hygiene products into which the Products
     are incorporated.

1.02 "New Companies" means SHC, SSC and SMC.

1.03 "Patents" shall mean the China Patents and the Other Patents. "China
     Patents" means Chinese application for invention No.97181473.2, and other
     related Chinese applications and their counterparts in Hong Kong that have
     been or will be filed, and any patents to issue upon any such patent
     application and divisions, continuations, continuations-in-part, or
     reissues of any of the foregoing, now owned by JATI, or other patents
     subsequently acquired by JATI or under which JATI has royalty-free
     sublicensing rights, which patents would be infringed by the manufacture,
     use or sale of the Products or the End Products if their manufacture, use
     or sales in the Territory (as hereinafter defined) were not authorized.
     "Other Patents" shall mean any patents of JATI relating to the technology
     that would be infringed by DSG or MC's distribution, use, or sale of the
     End Products anywhere in the world if DSG or MC's distribution, use, and
     sale of the End Products were not authorized.

1.04 "Products" means certain highly absorbent sheet materials for use in
     absorbent products such as disposable baby and incontinent diapers,
     feminine hygiene products and the like, as covered by the Patents.

1.05 "Technical Information" means confidential technical information and
     know-how JATI has acquired as a result of scientific research, practical
     experience, and otherwise that is reasonably related to the practice of the
     Patents for the manufacture and use of the Products and the End Products.

1.06 "Territory" means the Exclusive Territory and the Nonexclusive Territory.
     "Exclusive Territory" means the People's Republic of China and Hong Kong.
     "Nonexclusive Territory" means Australia, Brunei, India, Indonesia, the
     Republic of Korea, Malaysia,

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     New Zealand, the Philippines, Singapore, Taiwan, Thailand, and Vietnam.

ARTICLE 2. Representation and Warranties,

2.01 DSG represents and warrants to the other Parties as follows:

          (a)  DSG is a duly organized corporation existing in good standing
               under the laws of British Virgin Island.
          (b)  The making and performance of this Agreement are within DSG's
               corporate powers, have been duly authorized by all necessary
               corporate actions of DSG and do not contravene any provisions of
               law or of the Articles of Association of DSG or of any contract
               binding on DSG.

2.02 JATI represents and warrants to the other Parties as follows:

          (a)  JATI is a duly organized corporation existing in good standing
               under the laws of Japan.
          (b)  The making and performance of this Agreement are within JATI's
               corporate powers, have been duly authorized by all necessary
               corporate actions of JATI and do not contravene any provisions of
               law or of the Articles of Association of JATI or of any contract
               binding on JATI.

2.03 MC represents and warrants to the other Parties as follows:-

          (a)  MC is a duly organized corporation existing in good standing
               under the laws of Japan.
          (b)  The making and performance of this Agreement are within MC's
               corporate powers, have been duly authorized by all necessary
               corporate actions of MC and do not contravene any provisions of
               law or of the Articles of Association of MC or of any contract
               binding on MC.

ARTICLE 3. Establishment of New Companies

3.01 Establishment of SHC Within one (1) month after the execution of this
     Agreement, subject to necessary approval of the Governments of British
     Virgin Island, the Parties shall establish SHC in accordance with the
     provisions of this Agreement and following conditions:

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          (a)  The name of SHC shall be "Shuiling Holding Company Limited", or
               such other name as may be mutually agreed upon by the Parties.
          (b)  The primary objects of SHC shall be holding all shares of SSC and
               SMC to control and manage these two companies.
          (c)  The Principal office of SHC shall be located at [Address at Hong
               Kong].
          (d)  The authorized capital of SHC at the time of establishment shall
               be five million US Dollars (US$ 5,000,000), divided into five
               million (5,000,000) ordinary shares with par value of one US
               Dollar (US$1.00) each.
          (e)  The Memorandum of Association and the Article of Association of
               SHC shall be substantially in the form and substance as EXHIBITs
               A and B attached hereto respectively.

3.02 Establishment of SSC Immediately after the establishment of SHC, the
     Parties shall cause SHC to begin the procedure of establishing SSC in
     accordance with the laws of Peoples Republic of China (PRC), the provisions
     of this Agreement and following conditions:

          (a)  The name of SSC shall be ("Shanghai DSG MegaThin Company
               Limited"), or such other name as may be mutually agreed upon by
               the Parties.
          (b)  The primary objects of SSC shall be to manufacture and sell the
               Products.
          (c)  The registered office of SSC shall be located at [Address at
               People's Republic of China]. (The location of the land at
               Waiguoqiao)
          (d)  The registered capital of SSC at the time of establishment shall
               be five million US Dollars (US$ 5,000,000).
          (e)  The Memorandum and Article of Association of SSC shall be
               substantially in the form and substance as EXHIBITs C and D
               attached hereto.

3.03 Establishment of SMC After the establishment of SHC, the Parties shall
     cause SHC to begin the procedure of establishing SMC in accordance with the
     laws of Macau, Special Administration Region (SAR), the provisions of this
     Agreement and following

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     conditions:

          (a)  The name of SMC shall be "Shuiling (Macau) Company Limited", or
               such other name as may be mutually agreed upon by the Parties.
          (b)  The primary objects of SMC shall be to market and sell the
               Products.
          (c)  The registered office of SMC shall be located at Macau.
          (d)  The authorized capital of SMC at the time of establishment shall
               be one thousand US Dollars (US$ 1,000), divided into one thousand
               (1,000) ordinary shares with par value of one US Dollar (US$1.00)
               each.
          (e)  The Memorandum of Association and the Article of Association of
               SMC shall be substantially in the form and substance as EXHIBITs
               E and F attached hereto respectively.

ARTICLE 4. Issue of Shares

4.01 Issue of Shares Immediately after the establishment of the SHC, SHC shall
     issue five million (5,000,000) ordinary shares, and each of the Parties
     shall subscribe and pay fully in cash for such shares at par in the
     following ratio:

Name   Ratio   Number of Shares
----   -----   ----------------
JATI   :  5%         250,000
MC     : 20%       1,000,000
DSG    : 75%       3,750,000

4.02 Additional Shares In the event the issued share capital of SHC is increased
     from time to time, each of the Parties shall have the obligation to
     subscribe and pay -in full for such new shares in proportion to the ratio
     of its then shareholding.

ARTICLE 5. General Meeting of Shareholders

5.01 Annual General Meeting An ordinary general meeting of shareholders shall be
     held within six (6) months after the end of each accounting period of SHC.

5.02 Extraordinary General Meeting An extraordinary general meeting of
     shareholders may be convened by the request of any shareholder when it is
     deemed necessary or appropriate.

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5.03 Notice of General Meeting Prior written notice of all general meetings of
     shareholders shall be sent to all shareholders at least twenty one (21)
     days before the meeting, specifying the time and place of the meeting and
     indicating all matters to be considered thereat, together with copies for
     reports, studies and any other data relating thereto, provided, however,
     that notice may be waived by the written consent of all the shareholders of
     SHC.

5.04 Quorum The quorum for all general meetings of shareholders shall be two (2)
     shareholders representing not less than fifty one percent (51%) of then
     issued and outstanding shares.

5.05 Vote At any general meeting of shareholders, any shareholder may attend and
     vote in person or by proxy appointed by an instrument in writing. Each
     shareholder shall be entitled to one vote for each share owned by it.

5.06 Chairman DSG shall appoint the chairman of the general meeting of
     shareholders. The chairman of the general meeting shall not be entitled to
     a second or casting vote.

5.07 Resolution Unless prohibited by any applicable law, to approve the
     following types of resolutions, the affirmative vote of not less than
     eighty percent (80%) of the issued and outstanding shares of SHC shall be
     required:

     (a)  Amendment, addition, change, modification or deletion of any portion
          of the Memorandum of Association or Articles of Association of the New
          Companies;
     (b)  Increase or decrease in capital of the New Companies, including
          issuance of shares with any preference;
     (c)  Any merger, acquisition of all or substantially all of the assets of
          the New Companies by the third party, or any transaction with a
          similar effect;
     (d)  Sales, lease, transfer, mortgage, charge, pledge, encumbrance or any
          other disposal of all or a substantial part of the shares, assets or
          business of the New Companies;
     (e)  Any other action for which a special or extraordinary resolution is
          required to

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          be passed under the laws of British Virgin Island with respect to SHC.

     (f)  Transaction between the New Companies and any shareholder of the New
          Companies or any person, firm or company that controls, is controlled
          by, or is under common control of any shareholder of the New
          Companies, with not less than the transaction amount US$5,000,000.-;
     (g)  Issuance of debentures, bonds or any other debt securities by the New
          Companies;
     (h)  Guarantee for the obligation or indebtedness of any person, firm or
          company by the New Companies;

     To approve any of the following types of resolutions with respect to the
     New Companies, a unanimous vote of the issued and outstanding shares shall
     be required:

     (a)  Liquidation or dissolution;

ARTICLE 6. Board of Directors

6.01 Directors The Board of Directors of SHC shall consist of four (4) members,
     three (3) of whom shall be nominated and may be removed by DSG and the
     remaining one (1) shall be nominated and may be removed by MC

     If for any reason there is a vacancy in any office of the directors, such
     vacancy shall be filled solely by nomination by the party who nominated the
     director whose absence creates such vacancy to be filled.

6.02 Remuneration No director shall be entitled to receive any remuneration for
     his services from the New Companies except actual expenses for attending
     the meeting of the Board of Directors, provided, however, that nothing
     herein contained shall preclude any director from serving the New Companies
     in any other capacity and receiving remuneration therefor.

6.03 Board of Directors The directors may meet together for the dispatch of
     business, adjourn and otherwise regulate the meetings of the Board of
     Directors as they think fit. A director may at any time, and the secretary
     of the New Companies, who shall be

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     nominated by DSG, (hereinafter referred to as the "Secretary") shall, on
     the request of a director, convene a meeting of the Board of Directors.

6.04 Notice of Board of Directors Prior written notice of meetings of the Board
     of Directors shall be sent to all directors at least seven (7) days before
     the meeting, specifying the time and place of the meeting and indicating
     all matters to be considered thereat, together with copies of reports,
     studies and any other data relating thereto, provided, however, that notice
     may be waived by the unanimous consent of all directors in writing.

6.05 Quorum The quorum for all meetings of the Board of Directors shall be three
     (3).

6.06 Votes

     (a)  Each director shall have one vote.

          In lieu of a validly constituted meeting as above described, unless
          prohibited under the applicable laws or regulations, any resolution of
          the Board of Directors shall be considered to have been validly passed
          if consented in writing by at least three directors of the Board.

     (b)  Unless prohibited in any applicable law or regulation, the party may
          by prior notice in writing SHC to nominate and appoint any person to
          act as alternate director for a director, whom the party has
          nominated, in the event of his absence. The alternate director shall
          be granted full power and authority to act as director in meeting of
          the Board of Directors.

6.07 Managing Director The Managing Director shall be appointed from among the
     directors nominated by DSG and shall act as the chairman of the meeting of
     the Board of Directors. In the event of his absence from the meeting of the
     Board of Directors, DSG shall appoint one director from the Board of
     Directors to act as the chairman of the meeting. The chairman shall not
     have a second or casting vote in the event of a tie at any meeting of the
     Board of Directors.

     Unless otherwise provided for in any other provisions of this Agreement,
     the Memorandum of Association or the Articles of Association of the New
     Companies, the Managing Director shall have the general power and authority
     to manage and control all business and affairs of the New Companies except
     for those matters stipulated in Article 6.08 below.

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     In the event the shareholding ratio of SHC mentioned in Article 4.01 is
     changed due to additional shares mentioned in Article 4.02 and the transfer
     of shares stipulated in Article 7.01 and 7.02, the number of directors whom
     each party hereto shall be entitled to nominate shall be revised according
     to the new shareholding ratio.

6.08. Resultions

     The duty, power and authority of the Board of Directors shall be provided
     in the Memorandum of Association and Articles of Association.

ARTICLE 7. Transfer of Shares

7.01 Restriction on Transfer of Shares For three (3) years from the date of the
     establishment of the New Companies, no Party may sell, transfer, assign,
     hypothecate, encumber, pledge or otherwise dispose of all or any part of
     its shares in SHC without the prior written consent of all the other
     Parties. To avoid any doubt, this Article shall not prohibit any
     substantial change in the ownership of any Party, whether by merger or
     sales of stock. Notwithstanding the foregoing, each Party (in this Article
     7.01, called the "Asset Seller") may transfer all (not a part) of its
     shares in SHC to any third party (in this Article 7.01, called the "Asset
     Purchaser") when the Asset Seller sells all or substantial part of its
     assets to the Asset Purchaser, on condition that the Asset Purchaser
     informs the Parties in written form of its consent to assume all
     obligations of the Asset Seller under this Agreement and any agreement
     mentioned herein.

7.02 First Right of Refusal

     (a)  In the event that any of the Parties desires to sell, transfer,
          assign, hypothecate, encumber, pledge or otherwise dispose of all or
          any part of its shares in SHC to any third party(s), such Party (in
          Article 7.02 and 7.03 called the "Transferor") shall first offer in
          writing to sell such shares to each of the other Parties (in this
          Article 7, called the "Offerees") in proportion to the ratio of its
          then shareholding in the New Companies or to sell such shares to the
          other Offeree if any one of the Offerees has declined the said offer.
          The offer made by Transferor to each of the Offerees must be accepted
          in full and not just to a part of the shares so offered to it.

     (b)  In the event that the Offerees do not give to the Transferor written
          notice, within sixty (60) days from the date of the offer of its or
          their desire to purchase the

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          shares so offered, the said offer shall deem to have been declined.

     (c)  In the event that either or both of the other Offerees give to the
          Transferor written notice, within sixty (60) days from the date of the
          offer, of its or their desire to purchase the shares so offered but
          the Transferor and such Offeree or Offerees (hereinafter referred to
          as the "Price Disagreeing Offeree") are unable to agree upon a
          purchase price within thirty (30) days from the date of such notice,
          then the book value of the shares on the basis of the financial
          condition of SHC on the last day of the calendar month immediately
          preceding the date of the said notice as determined by the firm of
          independent certified public accountants then employed to audit the
          books and accounts of SHC shall be determined as a suggested purchase
          price (the "Suggested Price"). Within thiry (30) days from the date of
          the determination of the Suggested Price, the Price Disagreeing Party
          or Price Disagreeing Parties shall give to the Transferor the notice
          of whether it or they agree or decline to purchase the offered shares
          at such Suggested Price.

     (d)  In the event that either or both of the Price Disagreeing Parties do
          not give such notice to the Transferor within thirty (30) days from
          the date of the determination of the Suggested Price, the Price
          Disagreeing Party or Price Disagreeing Parties shall be deemed to have
          declined to purchase the offered shares at the Suggested Price.

   The offer made by Transferor to each of the Offerees must be accepted in full
   not a part of the shares offered. If either of the Offerees, decline the
   offer or does not make cash payment in full within thirty (30) days from the
   date of the agreement as to the purchase price, then the Transferor shall
   offer those shares to the other Offerees.

7.03 Transfer to Third Party

     (a)  If all the shares which the Transferor desires to sell are not
          purchased after the procedures mentioned in the preceding provisions
          of this Article 7.02 have been taken, the Transferor may sell,
          transfer, assign, hypothecate, encumber, pledge or otherwise dispose
          of all or any part of such shares to any third party(s); provided,
          however, that, in case of sale, the price shall not be less than
          (I) the price which Transferor and any of the Offerees agreed upon or
          (II) Suggested Price as determined pursuant to Article 7.02.

     (b)  In case the Transferor should be unable so to dispose of all or a part
          of such shares

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          to any third party(s) within three (3) months after the other parties
          have declined to purchase them, then the Transferor shall no longer be
          free so to dispose of the shares without again following the
          procedures set out in the preceding provisions of this Article 7.

     (c)  In the event that (i) any Offeree, whose shareholding ratio in SHC is
          less than fifty percent (50%) (hereinafter called the "Minority
          Shareholder"), declines (or is deemed to decline) the offer mentioned
          in the Article 7.02 and (ii) the Transferor sells all or part of such
          shares in SHC to any third party (hereinafter referred to as the
          "Possible Purchaser" and this transaction shall be hereinafter
          referred to as the "Proposed Transfer"), then the Minority
          Shareholders shall have the right to require the Transferor, prior to
          the Proposed Transfer, offer to sell the Minority Shareholders' shares
          in SHC in addition to those owned by the Proposed Transferor at the
          same price and on the same terms as set forth in the Proposed
          Transfer.

7.04 Transfer to Subsidiaries Notwithstanding any of the provisions of this
     Article 7; Any of the Parties may sell or transfer all or any part of its
     shares in SHC to its wholly owned subsidiary(s), provided, however, that no
     such sale or transfer shall relieve such transferor of its obligations
     hereunder.

ARTICLE 8. Financing

8.01 Self Financing All necessary funds for the operations and activities of the
     New Companies which cannot be covered by the subscribed and paid up capital
     shall be secured by the New Companies by means of procuring loan(s) from
     independent sources and/or issuing bond(s), debenture(s) or other debt
     securities.

8.02 Financial Obligation, If the New Companies cannot secure such necessary
     funds by itself, all the Parties shall, subject to necessary internal
     approval of them, procure such funds for the New Companies in proportion to
     the ratio of their then respective shareholdings in SHC by way of making
     direct loan(s) to the New Companies, guaranteeing or furnishing collateral
     to banking institutions (hereinafter called the "Lender") for the benefit
     of the New Companies or rendering other appropriate financial assistance to
     the New Companies.

8.03 Maximum Financial Obligations of Shareholders In any event, the total
     amount of financial obligations (including payment for shares provided in
     Article 4.01) of the

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     Parties shall not exceed the amount as follows (hereinafter referred to as
     the "Maximum Financial Obligations")
     JATI  : US$ 1,350,000.-
     MC    : US$ 5,400,000.-
     DSG   : US$20,250,000.-
     TOTAL : US$27,000,000.-

     In the event that JATI is unable to meet its financial obligations
     (excluding payment for shares provided in Article 4.01) in terms of
     providing security, collateral, guarantee and financial assistance for the
     New Companies, MC, subject to its necessary internal approval, undertakes
     to assume the financial obligations of JATI.

     In the event that the maximum financial obligation is exceeded, each
     parties shall decide individually whether or not to increase additional
     financial arrangement for the New Company.

8.04 Assumption of the Obligation of Financial Assistance Upon completion of a
     Party's (hereinafter called the "Purchasing Party") purchase of all of the
     shares of SHC held by another Party (hereinafter called the "Selling
     Party"), the Purchasing Party shall irrevocably and unconditionally assume
     and agree to perform, in due course and without any delay, all the
     financial obligations of the Selling Party under, or being provided
     pursuant to, Article 8.02 at the time of the sale and purchase of such
     shares. The Selling Party shall be released and discharged from the
     financial obligations; provided, however, that, in the event that the
     Lenders do not grant their consent to the release and discharge of the
     financial obligations of the Selling Party, the Purchasing Party shall
     guarantee all such obligations of the Selling Party and indemnify and hold
     harmless the Selling Party from all the losses, damages and costs incurred
     by the Selling Party in connection with the financial obligations.

ARTICLE 9. Remittance of Dividends

9.01 Dividends SHC shall remit dividends in U.S. Dollars, if any, declared at
     the general meeting of shareholders to each of the shareholders of SHC
     within forty-five (45) days after its resolution for payment of such
     dividends. SHC has intention to provide at least 20% of all consolidated
     accumulated surplus earnings of the New Company to shareholder, and the
     Board of Directors of the New Company will decide whether or not SHC is in
     a position to provide such cash distribution. SSC and SMC shall remit

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     dividends, if any, to SHC within thirty (30) days after its resolution for
     payment of such dividends.

9.02 Approval The New Companies shall take all necessary steps at their own
     expenses to obtain any legal or official approval(s) required for the
     payment of dividends.

9.03 Withholding Tax In the event that it is required to deduct withholding tax
     from dividends payable to the Parties or SHC under the laws of the country
     of the New Company paying the dividend, the New Companies shall furnish to
     such Parties official tax receipts or other evidence issued by the tax
     authorities of the country sufficient to enable the Parties or SHC to
     establish payment of such withholding tax in support of a claim for tax
     credit, if any, in the country of the Parties or SHC.

ARTICLE 10. Accounting

10.01 Accounting Period The accounting period of the New Companies shall
     commence on the 1st day of January and end on the 31st day of December in
     each year.

10.02 Accounting Record The New Companies shall keep true and correct accounting
     records and books with regard to all of its operations and activities. Each
     of the Parties shall have the right to inspect, during any business hours
     of the New Companies, such records and books by itself or its authorized
     representative at its expense without interrupting the normal operations
     and activities of the New Companies.

10.03 Accounting Report Each of the New Companies shall furnish audited
     financial report as of the end of each accounting period to all the Parties
     within one hundred twenty (120) days after the end of such accounting
     period. Such financial report must be certified by the firm of independent
     certified public accountants appointed at the Annual General Meeting.

ARTICLE 11. Auditors

11.01 Auditors All New Companies shall have one auditor who shall be nominated
     in the first year to appoint the current existing DSG's auditor.

11.02 Vacancy of Auditors If for any reason there occurs a vacancy in the office
     of auditor, such vacancy shall be filled solely by nomination by the Party
     or Parties who have

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     nominated the auditor whose absence creates the vacancy to be filled.

ARTICLE 12. License

12.01 License Agreement MC has granted to DSG a license to manufacture, use and
     sell the Products in Hong Kong and People's Republic of China. For this
     purpose, a separate "License agreement" has been executed between MC and
     DSG, the genuine copy of which is attached hereto as EXHIBIT G and all the
     rights and obligations of DSG under the License Agreement shall be
     transferred to SHC and a corresponding license agreement between SHC (as
     licenser) and SSC (as licensee) shall be executed when SSC is duly
     established by SHC."

ARTICLE 13. Supply of Raw Materials

13.01 Materials Supply Agreement MC shall have the right to supply super
     absorbent polymer (SAP), to SSC with competitive quality, quantity, price,
     service and free of patent infringement. For this purpose, separate
     "purchase agreement of raw materials" shall be executed between MC and SSC
     substantially in the form and substance as EXHIBIT H attached hereto
     respectively.

ARTICLE 14. Sale of Products

14.01 Sales Agreement between SSC and SMC Each Party agrees that SSC shall
     appoint SMC as Marketing and Selling Agent for the Products for all
     territories except the People's Republic of China. For this purpose, a
     separate "Sales Agreement A" shall be executed between SSC and SMC
     substantially in the form and substance as EXHIBIT I attached hereto.

14.02 Sales of the Products Each party agrees that the Products manufactured by
     SSC and then purchased by SMC from SSC (hereinafter called the "Sales
     Products") are sold to the customers by DSG and MC as sales agent for sales
     of the Products. For this purpose, a separate "Sales agreement B" shall be
     executed between SMC and DSG substantially in the form and substance as
     EXHIBIT J attached hereto, and a separate "Sales Agreement C" shall be
     executed between SMC and MC substantially in the form and substance as
     EXHIBIT K attached hereto.

     And, Each Party agree that DSG have the right to purchase up to thirty
     percent (30%) of the total production volume of SSC at Standard Costs Plus
     (hereinafter defined) and

                                       14

<PAGE>

     for the rest of production volume Sales Products shall be sold to DSG and
     MC, and others at market price basis.

14.03 Standard Costs Plus For the purpose of the purchase by DSG referred in
     14.02 above, the Standard Costs Plus is defined as the costs of production
     including costs of raw materials, packaging, labour, production overheads
     and depreciation plus five percent 5% or a differently percentage number
     mutually agreed upon by all parties.

ARTICLE 15. Governmental Approval and Term

15.01 Term This Agreement shall become effective from the execution hereof,
     subject to any necessary approvals of the Governments of British Virgin
     Island, the PRC and Japan and shall continue for a period of [twenty (20)
     years] commencing on the date hereof. The term shall be automatically
     extended for [one (1) years] and thereafter for the same period
     successively, unless any party gives to the other written notice of
     termination at least three (3) months prior to the expiration of the
     original term or any such extension thereof.

15.02 Governmental Approval If all necessary approvals of the Governments of
     British Virgin Island and the People's Republic of China are not obtained
     within six (6) months from the date hereof, this Agreement shall cease to
     have effect and no party shall have any claim whatsoever against the other
     Party.

ARTICLE 16. Termination

16.01 Event of Termination If one or more of the following events occur with
     regard to any Party (hereinafter called the "Insolvent Party"), any of the
     other Parties (hereinafter individually called the "Non-Insolvent Parties"
     and collectively called the "Non-Insolvent Parties") may, notwithstanding
     the provisions of Article 15.01 hereof, terminate this Agreement by given
     written notice to all the other parties:

     (a)  Appointment of a trustee or a receiver for all or any part of the
          assets of the Insolvent Party;

     (b)  A petition in bankruptcy or insolvency by or against the Insolvent
          Party;

     (c)  Assignment of a substantial part of the assets of the Insolvent Party
          for the

                                       15

<PAGE>

          benefit of creditors other than lender (banks or any financing
          institution) as part of ordinary course of business;

     (d)  Attachment of a substantial part of the assets of the Insolvent Party
          other than lender (banks or any financing institution) as part of
          ordinary course of business;

     (e)  Expropriation or nationalization of a substantial part of the assets
          of the Insolvent Party;

     (f)  Dissolution or liquidation of the Insolvent Party; or

     (g)  Default of its obligations hereunder failing to remedy such default
          within a period of sixty (60) days after receiving written
          notification of such default from any of the other parties. In this
          case, the right of termination shall be exercisable within fourteen
          (14) days after the expiration of such sixty (60) days period.

16.02 Notification of Insolvency The Insolvent Party shall notify the other
     Parties immediately in writing for the occurrence of any such event
     enumerated in subparagraphs (a) through (g) above.

16.03 Non-Insolvent Party's Option

     Upon termination of this Agreement pursuant to this Article 16.01, the
     Non-Insolvent Party shall have the right to exercise any one of the
     following rights:

     (a)  to dissolve or liquidate the New Companies; or

     (b)  to purchase all or any part of the shares in SHC then held by the
          Insolvent Party at par value or the book value of the shares as fixed
          pursuant to Article 16.04, whichever lower.

     If both of the Non-Insolvent Parties select option (b) above, each of the
     Non-Insolvent Parties shall have the right to purchase the shares in
     proportion to the ratio of its then shareholding in SHC, provided, however,
     that if the number of shares which one of the Non-Insolvent Parties desires
     to purchase does not amount to the total number of shares which such
     Non-Insolvent Party is entitled to purchase, the

                                       16

<PAGE>

     other Non-Insolvent Party shall have the right to purchase all or any part
     of the shares not purchased by the Non-Insolvent Party first mentioned.

     If one of the Non-Insolvent Parties (in this Article 16.03 called the
     "(A)-Party") selects the option (a) above or does not exercise option (a)
     or (b) above and the other Non-Insolvent Party (in this Article 16.03
     called the "(B)-Party") selects option (b) above, the (B)-Party shall have
     the option to purchase all of the shares in SHC then held by the (A)-Party
     at the same price as is mentioned in (b) above. If the (B)-Party does not
     exercise within a reasonable time the option to purchase all of those
     shares, the New Companies shall be dissolved or liquidated.

     If one of the Non-Insolvent Parties selects the option (a) above and the
     other Non-Insolvent Party does not select option (a) or (b) above, the New
     Companies shall be dissolved or liquidated.

     If the Non-Insolvent Party(ies) selects the option (b) above, the provision
     of Article 8.04 shall not be applied to the sales of shares in SHC from the
     Insolvent Party to such Non-Insolvent Party(ies).

16.04 Book Value The book value of the shares stipulated in Article 16.03 and
     16.06 shall be fixed on the basis of the financial condition of SHC on the
     last day of the calendar month immediately preceding the date of the
     exercise of each option as determined by the firm of independent certified
     public accountants then employed to audit the books and accounts of SHC.

16.05 Termination for Special Events If any of the following events occurs,
     Minority Shareholders shall, notwithstanding the provisions of Article
     15.01 hereof, have the right to terminate this Agreement by giving written
     notice to DSG:

     (a)  there is no total net profit on SHC profit and loss statement for
          three (3) consecutive full accounting years from the commencement of
          SSC operation;

     (b)  the consolidated liabilities of the New Companies at any time exceed
          the consolidated assets of the New Companies after three (3) years of
          SHC operation.

                                       17

<PAGE>

16.06 Minority Shareholders' Option Upon termination of this Agreement pursuant
     to above Article 16.05, Minority Shareholders shall have the right to
     demand that DSG purchase all or any part of the shares (at Minority
     Shareholders' sole discretion) in SHC then held by Minority Shareholders at
     a price not higher than the book value of the shares as fixed pursuant to
     Article 16.04.

ARTICLE 17 Notice

17.01 Any notice, declaration, demand, request or other communication which is
     required hereunder shall be in writing, in the English language, and shall
     be given to each of the parties at its address or facsimile number set
     forth:

     To JATI:
          JAPAN ABSORBENT TECHNOLOGY INSTITUTE
          2-26-5 Nihonbashi Hamacho, Chuo-ku,
          Tokyo, Japan
          Attention : Dr. Migaku Suzuki
          Facsimile No.: 81-3-3249-7330

     To MC:
          MITSUBISHI CORPORATION
          6-3, Marunouchi 2-chome, Chiyoda-ku,
          Tokyo, Japan
          Attention: Manager of Organic Ammenities Unit
          Facsimile No.: 81-3-3210-5828

     To DSG:
          DSG International Limited
          17th Floor, Watson Centre, Kung Yip Street,
          Kwai Chung, Hong Kong
          Attention :
          Facsimile No. : 852-2427-6951

     Any such notices given by mail shall be considered to have been given on
     the seventh day after having been mailed in the manner provided above.

     Any party may change its address by giving the other parties written notice
     of such

                                       18

<PAGE>

     change in the manner provided above.

ARTICLE 18. Governing Law

18.01 This Agreement shall be governed by and construed in all respects in
     accordance with the laws of Singapore.

ARTICLE 19. Language

19.01 English shall be used officially in respect of all matters in connection
     with this Agreement, unless otherwise agreed in writing by all the Parties.

19.02 This Agreement shall be prepared in the English language. In case any
     translations are prepared and any dispute arises over the meaning of any
     provision, the English language version shall be controlling.

ARTICLE 20. Non-Assignment

20.01 This Agreement shall not be assigned to any third party(s) without prior
     written consent of all the other Parties.

ARTICLE 21 Entire Agreement

21.01 This Agreement represents the entire agreement and understanding between
     the Parties with respect to the subject matter of this Agreement and
     supersedes any other agreements or understanding, written or verbal, that
     the Parties may have had; provided, however, that Cost-Sharing Agreement
     among DSG, JATI and MC shall be effective even after the execution of this
     Agreement.

ARTICLE 22. Settlement of Dispute

22.01 Any dispute which may arise between the Parties out of or in relation to
     this Agreement or breach thereof shall, unless settled without undue delay
     by amicable arrangement of the Parties, be referred to arbitration in
     Singapore in accordance with the Arbitration Rules of the Singapore
     International Arbitration Centre. Any arbitration procedure shall be
     conducted in English. The award shall be final and binding upon the
     Parties, and judgement on such award may be entered in any court or

                                       19

<PAGE>

     tribunal having jurisdiction there over.

ARTICLE 23. Secrecy Provisions

23.01 Each Party (hereinafter called the "Recipient") shall not, during the term
     of this Agreement, directly or indirectly, disclose or divulge to any third
     party any of the trade secrets, proprietary information or other matters
     deemed confidential by similarly situated business (hereinafter
     collectively called "Confidential Information") received in connection with
     the performance of this Agreement; provided, however, that Confidential
     Information shall not include any information;

     (a)  which is in the public domain at the time of receipt
     (b)  which thereafter enters the public domain through no action or
          inaction by Recipient or those to whom Recipient has disclosed
          Confidential Information;
     (c)  which is in the possession of or known to Recipient prior to its
          receipt thereof;
     (d)  which is rightfully disclosed to Recipient by a third party not in
          violation of any confidential obligation;
     (e)  which is independently developed by Recipient; or
     (f)  which is required to disclose by any applicable orders, rules,
          regulations or laws.

ARTICLE 24. Priority of Joint Venture Agreement

24.01 In the event that there is any discrepancy between the contents in this
     Agreement and those in the Memorandum and Article of Association of the New
     Companies, the Parties agree to apply the former and amend the Memorandum
     and Articles of Association to be consistent with this Agreement.

IN WITNESS WHEREOF, all the parties have caused this Agreement to be executed in
triplicate, each triplicate of which shall be considered an original, by their
respective officers thereunto duly authorized as of the day and year first above
written.

                                       20

<PAGE>

                                 Japan Absorbent Technology Institute

                                 /s/ Migaku Suzuki
                                 -----------------------------------------------
                                 Name: Migaku Suzuki
                                 Title: President-Representative Director

                                 Mitsubishi Corporation

                                 /s/ Takuro Maruoka
                                 -----------------------------------------------
                                 Name: Takuro Maruoka
                                 Title: General Manager, Organic Amenities Unit,
                                        Functional Chemicals Division

                                 DSG International Limited

                                 /s/ Brandon Wang
                                 -----------------------------------------------
                                 Name: Brandon Wang
                                 Title: Member of Executive Cabinet
                                        Chairman & Chief Executive

                                       21<PAGE>

                                                                     EXHIBIT 4.4

                        SIXTH AMENDMENT TO LOAN AGREEMENT

          This SIXTH AMENDMENT TO LOAN AGREEMENT (this "Amendment") is entered
into as of November 14, 2002, among ASSOCIATED HYGIENIC PRODUCTS LLC, a Delaware
limited liability company ("Borrower"), the Lenders signatory hereto, and
FOOTHILL CAPITAL CORPORATION, a California corporation, in its capacity as
administrative agent ("Agent") for the Lenders (as defined below).

                                   WITNESSETH:

          WHEREAS, Borrower, the Lenders (as defined therein) and Agent have
entered into that certain Amended and Restated Loan and Security Agreement dated
as of March 14, 2001, as amended by that certain First Amendment to Loan
Agreement, as further amended by that certain Second Amendment to Loan
Agreement, as further amended by that certain Third Amendment and Waiver to Loan
Agreement, as further amended by that certain Fourth Amendment to Loan
Agreement, and as further amended by that certain Fifth Amendment to Loan
Agreement prior to the date hereof (as the same may be further modified,
amended, restated or supplemented from time to time, the "Loan Agreement"),
pursuant to which the Lenders have agreed to extend credit to Borrower from time
to time; and

          WHEREAS, Borrower has requested that Agent and the Lenders amend the
Loan Agreement to increase the Wal-Mart concentration limit from 25% to 55% for
a period of 60 days, and 50% thereafter; and

          WHEREAS, Borrower, Agent and the Lenders have agreed to amend the Loan
Agreement to provide that Revolver Advances (and not Capital Expenditure Loans
and Term Loans) may only bear interest at the LIBOR Rate; and

          WHEREAS, Borrower, Agent and the Lenders have agreed to amend the Loan
Agreement to provide that the Maximum Amount shall be reduced from $35,000,000
to $30,000,000; and

          WHEREAS, Borrower, Agent and the Lenders have agreed to amend the
provision of the Loan Agreement regarding conditions precedent to all extensions
of credit with regard to any Capital Expenditure Loan; and

          WHEREAS, Borrower has requested that Agent and the Lenders consent to
the purchase of a new high speed diaper machine and the release of two existing
machines as "trade-ins" on such purchased equipment; and

          WHEREAS, Agent and the Lenders have agreed to the requested amendments
on the terms and conditions set forth herein;

<PAGE>

          NOW THEREFORE, in consideration of the foregoing premises and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree that all capitalized terms not
otherwise defined herein shall have the meanings ascribed to such terms in the
Loan Agreement and further agree as follows:

     1. Amendments to Loan Agreement.

          (a) Amendments to Section 1.1 of the Loan Agreement. Section 1.1,
"Definitions," is hereby amended and modified as follows:

               (i) The definition of "Eligible Accounts" is hereby amended and
     modified by deleting cause (i)(c) thereof in its entirety and substituting
     the following in lieu thereof:

               "(c) in the case of Wal-Mart, fifty-five percent (55%) of all
     Eligible Accounts from October 31, 2002 to December 31, 2002, and fifty
     percent (50%) of all Eligible Accounts thereafter; and"

               (ii) The definition of "LIBOR Rate Loan" is hereby amended and
     modified by deleting such definition in its entirety and substituting the
     following in lieu thereof:

               ""LIBOR Rate Loan" means each Borrowing of an Advance that bears
     interest at a rate determined by reference to the LIBOR Rate."

               (iii) The definition of "Maximum Amount" is hereby amended and
     modified by deleting such definition in its entirety and substituting the
     following in lieu thereof:

               ""Maximum Amount" means $30,000,000."

          (b) Amendment to Section 2.6 of the Loan Agreement. Section 2.6 of
the Loan Agreement, "Interest Rates and Letter of Credit Fee: Rates. Payments,
and Calculations," is hereby amended and modified by deleting clause (a),
"Interest Rates", thereof in its entirety and substituting the following in lieu
thereof:

               "(a) Interest Rates. Except as provided in clause (c) below, all
     Obligations (except for undrawn Letters of Credit) that have been charged
     to the Loan Account pursuant to the terms hereof shall bear interest on the
     Daily Balance thereof as follows: (i) if the relevant Obligation is an
     Advance made as a LIBOR Rate Loan, at a per annum rate equal to the LIBOR
     Rate plus the margin (as determined below) in effect from time to time in
     connection with LIBOR Rate Loans (the

                                       2

<PAGE>

     "LIBOR Rate Margin") with respect to Advances, (ii) if the relevant
     Obligation is a Capital Expenditure Loan or Term Loan, at a per annum rate
     equal to the Base Rate plus the margin (as determined below) in effect from
     time to time in connection with Base Rate Loans (the "Base Rate Margin")
     with respect to Capital Expenditure Loans and the Term Loan, and (iii) all
     other Obligations (except for undrawn Letters of Credit), at a per annum
     rate equal to the Base Rate plus the Base Rate Margin in effect for
     Advances made as Base Rate Loans. From the Closing Date to the First
     Adjustment Date, the Base Rate Margin in connection with Advances shall be
     2.25%, the Base Rate Margin in connection with Capital Expenditure Loans
     and the Term Loan shall be 2.75%, and the LIBOR Rate Margin in connection
     with Advances shall be 3.75%. Commencing on the later of March 31, 2002 or
     the sixth (6th) day following the delivery of Borrower's financial
     statements to Agent for the fiscal year ending December 31, 2001 (the
     "First Adjustment Date") and on each Adjustment Date thereafter, the Base
     Rate Margin and the LIBOR Rate Margin shall each be adjusted to be the
     interest rate margin based upon the Total Debt to EBITDA Ratio for the 12
     fiscal months then ended as set forth in such financial statements
     delivered to Agent pursuant to Section 6.3(a) as of the fiscal quarter end
     preceding such Adjustment Date, and expressed as a per annum rate of
     interest as set forth in the table below.

<TABLE>
<CAPTION>
     ----------------------------------------------------------------------------
                                                        Then the       Then the
                                                       LIBOR Rate      Base Rate
      If the Total Debt          Type of Loan         Margin shall   Margin shall
     to EBITDA Ratio is:         Outstanding:              be:            be:
     ----------------------------------------------------------------------------
<S>                        <C>                            <C>            <C>
         Less than or      Advances                       3.25%          1.75%
     equal to 2.5 to 1.0   ------------------------------------------------------
                           Term Loan,                      N/A           2.25%
                           Capital Expenditure Loan
     ----------------------------------------------------------------------------
       Greater than 2.5    Advances                       3.50%          2.00%
       to 1.0 but less     ------------------------------------------------------
       than 3.0 to 1.0     Term Loan,                      N/A           2.50%
                           Capital Expenditure Loan
     ----------------------------------------------------------------------------
       Greater than 3.0    Advances                       3.75%          2.25%
       to 1.0 but less     ------------------------------------------------------
       than 3.5 to 1.0     Term Loan,                      N/A           2.75%
                           Capital Expenditure Loan
     ----------------------------------------------------------------------------
       Greater than 3.5    Advances                       4.00%          2.50%
       to 1.0 but less     ------------------------------------------------------
       than 4.0 to 1.0     Term Loan,                      N/A           3.00%
                           Capital Expenditure Loan
     ----------------------------------------------------------------------------
         Equal to or       Advances                       4.25%          2.75%
       greater than 4.0    ------------------------------------------------------
            to 1.0         Term Loan,                      N/A           3.25%
                           Capital Expenditure Loan
     ----------------------------------------------------------------------------
</TABLE>

          (c) Amendments to Section 2.13 of the Loan Agreement. Section 2.13,
"LIBOR Option," is hereby amended and modified as follows:

                                       3

<PAGE>

               (i) Clause (a) of Section 2.13 is hereby amended and modified by
     deleting the phrase "Term Loan or Capital Expenditure Loans" from the first
     sentence of such clause.

               (ii) Clause (a) of Section 2.13 is hereby further amended and
     modified by deleting the phrase "or Capital Expenditure Loans or portions
     of the Term Loan" from the last sentence of such clause.

               (iii) Clause (b)(i) of Section 2.13 is hereby amended and
     modified by deleting the phrase "or the Term Loan" from the second sentence
     of such clause.

          (d) Amendment to Section 3.3 of the Loan Agreement. Section 3.3 of the
Loan Agreement, "Conditions Precedent to all Extensions of Credit," is hereby
amended and modified by deleting subsection 3.3(e) in its entirety and
substituting the following in lieu thereof:

               "(e) with regard to any Capital Expenditure Loan, Borrower and
     DSG shall have satisfied all of their respective obligations under the
     Settlement Agreement, and Excess Availability (after subtracting the amount
     of any payables of Borrower that are more than 60 days past due) shall be
     $5,000,000 or more for at least thirty (30) consecutive days prior to the
     date of such Capital Expenditure Loan."

          (e) Amendment to Schedule C-1 of the Loan Agreement. Schedule C-1 of
the Loan Agreement, Commitments, is hereby amended and modified by deleting
Schedule C-1 in its entirety and substituting the schedule attached to this
Amendment as Annex A in lieu thereof.

          (f) Amendment to Schedule L-1 of the Loan Agreement. Schedule L-1 of
the Loan Agreement, Form of LIBOR Notice, is hereby amended and modified by
deleting the following language from the second full paragraph thereof, "an
outstanding portion of the Term Loan / outstanding Capital Expenditure Loans."

          (g) Amendment to Schedule P-1 of the Loan Agreement. Schedule P-1 of
the Loan Agreement, Permitted Liens, is hereby amended and modified by adding
the following language at the end thereof: "Liens on that certain high speed
diaper machine, model number J4-MV Baby Diaper Machine, serial number WM 3270."

          (h) Amendment to Schedule 5.20 of the Loan Agreement. Schedule 5.20 of
the Loan Agreement, Permitted Indebtedness, is hereby amended and modified by
adding the following language at the end thereof: "All obligations of Borrower
under that certain Promissory Note, dated as of October 8, 2002, in the
principal amount of $2,705,250, issued by Borrower in favor of Curt G. JOA,
Inc."

                                       4

<PAGE>

          (i) Conversion. To the extent that as of the date of this Amendment
there are outstanding any Obligations constituting a portion of a Capital
Expenditure Loan or a Term Loan made as a LIBOR Rate Loan, then each such
Obligation shall automatically and without further action on the part of the
parties hereto be deemed converted into a Base Rate Loan on the date immediately
following the last day of the Interest Period applicable to such LIBOR Rate
Loan.

     2.   Waivers Regarding Purchase of JOA Equipment.

          (a) Agent and the Lenders hereby consent to the purchase (the "JOA
Purchase") of that certain high speed diaper machine, model number J4-MV Baby
Diaper Machine, serial number WM 3270-1899 (the "Purchased Equipment"), from
Curt G. JOA, Inc. and waive compliance with Sections 5.5, 6.6, 6.9, 7.1, 7.4 and
7.17 of the Loan Agreement, as necessary to permit Borrower to consummate such
purchase transaction, including (i) the transfer of certain existing equipment
to Curt G. JOA, Inc. (model number SN 500-90, serial number 5651043-F and model
number SN 500-90, serial number 660M1073-F; the "Trade-in Equipment") valued at
$262,500 each as "trade-ins" for the Purchased Equipment and (ii) use of
Advances to fund start-up costs necessary to make the Purchased Equipment
operational, upon the following terms and conditions:

          (b) the terms of the JOA Purchase will be set forth in a Purchase
Agreement, a Promissory Note (the "Note") and a Security Agreement, each in
substantially the form attached hereto as Annex B-l, Annex B-2 and Annex B-3,
respectively;

          (c) Borrower shall use proceeds from Advances to make a prepayment in
the aggregate amount of $224,400 towards the outstanding Term Loans associated
with the disposition of the Trade-in Equipment; provided however that, except as
provided herein, no other amounts, advances, fees, costs, borrowings, charges or
the like shall be made or incurred or deemed made or incurred under the Loan
Agreement in connection with the Trade-In Equipment or the JOA Purchase;

          (d) the Lenders shall have the right of first refusal to extend
financing to Borrower on equivalent terms to any valid competing offer to
refinance the final scheduled payment under the Note, and if the Lenders fail to
exercise the foregoing right of first refusal, Borrower may refinance the final
scheduled payment under the Note upon the terms set forth in the valid competing
offer;

          (e) upon satisfaction in full of Borrower's obligations under the Note
or in connection with any third-party refinancing, Agent shall be granted a
first priority security interest in the Purchased Equipment; and

          (f) Borrower shall provide such other information, documents,
instruments or approvals as Agent or Agent's counsel may reasonably require;

                                       5

<PAGE>

provided, however, the above-referenced waiver shall not waive any other
requirement or hinder, restrict or otherwise modify the rights and remedies of
Agent or the Lenders following the occurrence of any Default or Event of Default
under the Loan Agreement, including, but not limited to, any future defaults by
Borrower of the covenants contained in Sections 5.5, 6.6, 6.9, 7.1, 7.4 and 7.17
of the Loan Agreement. Agent and the Lenders hereby consent to and authorize
Agent to release any and all liens or security interests held by them pursuant
to the Loan Agreement against the Trade-in Equipment. Agent and the Lenders
acknowledge that, as of the effective date of the JOA Purchase, (A) neither
Agent nor the Lenders shall have a continuing right or interest in the Trade-in
Equipment, or proceeds thereof, and (B) until such time as Borrower's
obligations pursuant to the Note have been satisfied, Agent's Lien On the
Purchased Equipment is subordinated to the first priority security interest of
Curt G.Joa in the Purchased Equipment.

          (g) Upon execution of this Amendment and consummation of the JOA
Purchase, Agent agrees to file such documents as Borrower may reasonably
request, at Borrrower's expense, in order to release Agent's Lien on the
Trade-in Equipment; including without limitation, UCC-2 or UCC-3 Termination
Statements, as appropriate, for filing in each office where a UCC-1 Financing
Statement has been filed or other instruments are required to terminate the
filings or recordings in favor of Agent with respect to the Trade-in Equipment.

     3. No Other Amendments or Waivers. The execution, delivery and
effectiveness of this Amendment shall not operate as a waiver of any right,
power or remedy of Agent or the Lenders under the Loan Agreement or any of the
other Loan Documents, nor constitute a waiver of any provision of the Loan
Agreement or any of the other Loan Documents. Except for the amendments set
forth above, the text of the Loan Agreement and all other Loan Documents shall
remain unchanged and in full force and effect and Borrower hereby ratifies and
confirms its obligations thereunder. This Amendment shall not constitute a
modification of the Loan Agreement or any of the other Loan Documents or a
course of dealing with Agent or the Lenders at variance with the Loan Agreement
or the other Loan Documents such as to require further notice by Agent or the
Lenders to require strict compliance with the terms of the Loan Agreement and
the other Loan Documents in the future, except as expressly set forth herein.
Borrower acknowledges and expressly agrees that Agent and the Lenders reserve
the right to, and do in fact, require strict compliance with all terms and
provisions of the Loan Agreement and the other Loan Documents. Borrower has no
knowledge of any challenge to Agent's or any Lenders' claims arising under the
Loan Documents, or to the effectiveness of the Loan Documents.

     4. Conditions Precedent to Effectiveness. This Amendment shall become
effective as of the date hereof when, and only when, Agent shall have received:

                                       6

<PAGE>

          (a) an amendment fee from Borrower in the amount of $30,000, which fee
shall be fully earned and non-refundable when paid (it being understood that, by
execution and delivery of this Amendment, Borrower authorizes Agent to charge
Borrower's Loan Account for such fee and such amount shall thereafter accrue
interest at the rate applicable to Advances under the Loan Agreement in
accordance with Section 2.6 of the Loan Agreement);

          (b) counterparts of this Amendment duly executed and delivered by
Borrower and the Lenders; and

          (c) such other information, documents, instruments or approvals as
Agent or Agent's counsel may reasonably require.

     5. Representations and Warranties of Borrower. Borrower represents and
warrants as follows:

          (a) Borrower is a limited liability company organized, validly
existing and in good standing under the laws of the jurisdiction indicated at
the beginning of this Amendment and all other jurisdictions in which the failure
to be so qualified reasonably could be expected to constitute a Material Adverse
Change;

          (b) The execution, delivery, and performance by Borrower of this
Amendment and the Loan Documents to which it is a party, as amended hereby, are
within Borrower's limited liability company powers, have been duly authorized by
all necessary limited liability company action and do not and will not (i)
violate any provision of federal, state, or local law or regulation applicable
to Borrower, the Governing Documents of Borrower, or any order, judgment, or
decree of any court or other Governmental Authority binding on Borrower, (ii)
conflict with, result in a breach of, or constitute (with due notice or lapse of
time or both) a default under any material contractual obligation of Borrower,
(iii) result in or require the creation or imposition of any Lien of any nature
whatsoever upon any properties or assets of Borrower, other than Permitted
Liens, or (iv) require any approval of Borrower's members or any approval or
consent of any Person under any material contractual obligation of Borrower;

          (c) The execution, delivery, and performance by Borrower of this
Amendment and the Loan Documents to which it is a party, as amended hereby, do
not and will not require any registration with, consent, or approval of, or
notice to, or other action with or by, any Governmental Authority or other
Person;

          (d) This Amendment and each other Loan Document to which Borrower is a
party, and all other documents contemplated hereby and thereby, when executed
and delivered by Borrower will be the legally valid and binding obligations of
Borrower, enforceable against Borrower in accordance with their respective
terms, except as enforcement may be limited by equitable principles or by
bankruptcy, insolvency,

                                       7

<PAGE>

reorganization, moratorium, or similar laws relating to or limiting creditors'
rights generally; and

          (e) After giving effect to this Amendment, no Default or Event of
Default exists.

     6. Counterparts. This Amendment may be executed in multiple counterparts,
each of which shall be deemed to be an original and all of which, taken
together, shall constitute one and the same agreement. In proving this Amendment
in any judicial proceedings, it shall not be necessary to produce or account for
more than one such counterpart signed by the party against whom such enforcement
is sought. Any signatures delivered by a party by facsimile transmission shall
be deemed an original signature hereto.

     7. Reference to and Effect on the Loan Documents. Upon the effectiveness of
this Amendment, on and after the date hereof each reference in the Loan
Agreement to "this Agreement," "hereunder," "hereof" or words of like import
referring to the Loan Agreement, and each reference in the other Loan Documents
to "the Loan Agreement" "thereunder," "thereof" or words of like import
referring to the Loan Agreement, shall mean and be a reference to the Loan
Agreement as amended hereby.

     8. Costs, Expenses and Taxes. Borrower agrees to pay on demand all costs
and expenses in connection with the preparation, execution, and delivery of this
Amendment and the other instruments and documents to be delivered hereunder,
including, without limitation, the reasonable fees and out-of-pocket expenses of
counsel for Agent with respect thereto and with respect to advising Agent as to
its rights and responsibilities hereunder and thereunder.

     9. Governing Law. This Amendment shall be deemed to be made pursuant to the
laws of the State of Georgia with respect to agreements made and to be performed
wholly in the State of Georgia, and shall be construed, interpreted, performed
and enforced in accordance therewith.

     10. Loan Document. This Amendment shall be deemed to be a Loan Document for
all purposes.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       8

<PAGE>

          IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Amendment as of the day and year first written above.

BORROWER:                                       ASSOCIATED HYGIENIC PRODUCTS LLC

                                                By: /s/ GEORGE H. JACKSON III
                                                    ----------------------------
                                                Name:  GEORGE H. JACKSON III
                                                Title: CHIEF EXECUTIVE OFFICER

AGENT
and LENDER:                                     FOOTHILL CAPITAL CORPORATION,
                                                as Agent and a Lender

                                                By:
                                                    ----------------------------
                                                Name:
                                                      --------------------------
                                                Title:
                                                       -------------------------

                                       9

<PAGE>

          IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Amendment as of the day and year first written above.

BORROWER:                                       ASSOCIATED HYGIENIC PRODUCTS LLC

                                                By:
                                                    ----------------------------
                                                Name:
                                                      --------------------------
                                                Title:
                                                       -------------------------

AGENT
and LENDER:                                     FOOTHILL CAPITAL CORPORATION,
                                                as Agent and a Lender

                                                By: /s/ Drew Stawin
                                                    ----------------------------
                                                Name:  Drew Stawin
                                                Title: Senior Vice President

                                       10

<PAGE>

                                     Annex A

                                  Schedule C-1
                                   Commitments

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------
                                  Term Loan A     Term Loan B     Term Loan C
                     Revolver      Commitment      Commitment      Commitment       Total
    Lender          Commitment   (subfacility)   (subfacility)   (subfacility)    Commitment
--------------------------------------------------------------------------------------------
<S>                <C>             <C>             <C>             <C>           <C>
Foothill Capital   $30,000,000     $2,780,601      $2,934,365      $2,997,034    $30,000,000
Corporation
--------------------------------------------------------------------------------------------
All Lenders        $30,000,000     $2,780,601      $2,934,365      $2,997,034    $30,000,000
--------------------------------------------------------------------------------------------
</TABLE>

<PAGE>

                                    Annex B-1

                    Form Purchase Agreement for JOA Purchase

<PAGE>

                                  Attachment A

JOA Model J4-MV Baby Diaper Machine per Specification QW010397 dated November 2,
2001, and QW020159-E, dated October 4, 2002. Equipment includes:

..    3 Dimensional core former
..    Timed debulking unit
..    Upper tissue
..    Waistband applicator & unwind
..    Frontal tape applicator & unwind w/off-line loop material unwind & entrance
     kit
..    On-line glue hardware
..    ADL applicator & unwind
..    Nonwoven unwind with space for AHP uni-cuff folder
..    Soft backsheet laminator
..    Rotomatic tape applicator
..    C-fold
..    Bi-fold
..    5 Sprocket horizontal stacker w/2 discharge stations
..    (1) size change kit to product our Size 6 product
..    Nordson ATS hotmelt system ($275,000 OEM allowance is included)
..    Acrison Gravimetric SAP System ($85,000 allowance is included)
..    3/4" pitch on stacker for no extra cost
..    19.5" width capability for nonwoven included.
..    Full-width lamination capability (up to 15")
..    Innovent pockets at no additional cost
..    Free installation of Vision system
..    Nexen Air clutches instead of standard clutches at no charge (Air Champ TL
     50A-E for most uses, and TL 60-A for knife sections)
..    Vacuum filters on splice units at no cost
..    New style spreader rolls (At appropriate stations) with single bearings
     (cantilevered) at no charge
..    Dual vacuum manifolds on AD applicator unit at no cost
..    30 gallon air accumulator at stacker at no cost
..    Longer stacker carriage capability at no cost
..    End tab detect optics included

PRICE                                                             US $3,650,250
--------------------------------------------------------------------------------

Trade Option:

Base Price ...................................................    US$3,650,250
   Credit for (2) used JOA Napkin lines "Trade-in" ...........   (US$  525,000)
   Equipment Price ...........................................    US$3,125,250
   Finance Charge ............................................    US$   80,000
                                                                 -------------
   TOTAL PRICE ...............................................    US$3,205,250

<PAGE>

NOTE: Price includes 160 hours technical service (travel & living expenses
      by customer).

      Price includes one (1) Lyora unwind vs. the two (2) specified.

The removal of the 2 JOA Napkin lines by Curt G. Joa Inc. can be facilitated
3-4 weeks after October 11, 2002.

Schedule:

Based on today's engineering and manufacturing workload, shipment would be
approximately 18-20 weeks from receipt of purchase order and down payment.

Terms of Payment:
-----------------
Oct. 11, 2002   Down Payment with Order........................US$  500,000
Apr. 1, 2003    Progress Payment...............................US$  100,000
May 1, 2003     Progress Payment...............................US$  100,000
June 1, 2003    Progress Payment...............................US$  100,000
July 1, 2003    Progress Payment...............................US$  100,000
Aug. 1, 2003    Progress Payment...............................US$  100,000
Sept. 1, 2003   Progress Payment...............................US$  100,000
Oct. 1, 2003    Progress Payment...............................US$  100,000
Nov. 1, 2003    Progress Payment...............................US$  100,000
Dec. 1, 2003    Progress Payment...............................US$  100,000
Jan. 1, 2004    Progress Payment...............................US$  100,000
Feb. 1, 2004    Progress Payment...............................US$  100,000
Mar. 1, 2004    Progress Payment...............................US$  100,000
Apr. 1, 2004    Final Payment..................................US$1,505,250

NOTE: Curt G. Joa, Inc. will hold title of the equipment until final payment is
      received on April 1, 2004 through a promissory note. Foothill Capital
      Corporation will be granted a second priority interest until Final Payment
      is made.

      The April 1, 2003 payment and subsequent payments will be delayed if
      shipment of the machine is delayed. The first $100,000 payment will
      begin the first month after the machine is fully installed and making
      pads no earlier than April 1, 2003..

Future Equipment Purchase Incentive:

Within 12 months from receipt of purchase order of the machine proposed herein,
JOA offers the following discounted price for duplicate machine orders based on
US $3,650,250 base price. If the duplicate machine is ordered within 6 months, a
rebate of $46,000 will be credited against the final payment of the first
machine proposed herein.

Order of Qty. 1, price each.........................................US$3,504,000
Order of Qty. 2, price each.........................................US$3,395,000

<PAGE>

                                                    Purchase Order

<TABLE>
<S>                                                          <C>
Vancouver Maintenance Parts                                     DUPLICATE
Associated Hygienic Products LLC                             --------------------------------------------------------
Vancouver Maintenance Parts                                     Purchase Order      Date          Revision   Page
801 SE Assembly Ave                                             VANMP 0000003546    10/01/2002                 1
Vancouver WA 98661                                           --------------------------------------------------------
United States                                                   Payment Terms   Freight Terms                Ship Via
                                                                Scheduled       Customer Pickup at Factory   PICKUP
                                                             --------------------------------------------------------
                                                                Buyer: Connelly Owen   Currency Code:        USD
                                                             --------------------------------------------------------
     Vendor: 0000000840                                      Ship To: Associated Hygienic Products LLC
     CURT G JOA INC.                                                  Vancouver Maintenance Parts
     BIN NO 53193                                                     801 SE Assembly Ave
     MILWAUKEE WI 53288                                               Vancouver WA 98661
     United States                                                    United States

                                                             Bill To: Associated Hygienic Products LLC
                                                                      4455 RIVER GREEN PARKWAY
                                                                      DULUTH GA ______
                                                                      United States

Tax Exempt:   Y   Tax Exempt ID: NONE AVAILABL
----------------------------------------------------------------------------------------------------------------------
______________        Description                Mfg ID      Quantity   ___     PO Prize     Extended Amt    Due Date
----------------------------------------------------------------------------------------------------------------------
                      JOA Model J4-MV Baby                       1.00    __   3,205,250.00   3,205,250.00   01/01/2003
                      Diaper Machine                                        Schedule Total   3,205,250.00
                                                                                             ------------

                                                             Item Total                      3,205,250.00
                                                                                             ------------

SEE ATTACHMENT A

                                                                           Total PO Amount   3,205,250.00
                                                                                             ------------

----------------------------------------------------------------------------------------------------------------------

                                                                  Authorized Signature
                                                                                      --------------------------------
</TABLE>

<PAGE>

                                    Annex B-2

                      Form Promissory Note for JOA Purchase

<PAGE>

                                 PROMISSORY NOTE

$2,705,250.00

                                                      Sheboygan Falls, Wisconsin
                                                                October   , 2002
                                                                        --

     FOR VALUE RECEIVED, ASSOCIATED HYGIENIC PRODUCTS LLC, a Delaware limited
liability company (the "Borrower") hereby promises to pay to the order of CURT
G. JOA, INC. (the "Lender"), the principal sum of TWO MILLION SEVEN HUNDRED FIVE
THOUSAND TWO HUNDRED FIFTY AND 00/100 DOLLARS ($2,705,250.00) plus accrued and
unpaid interest on or before April 1, 2004, in the manner set forth hereinafter,
or such earlier date as the outstanding principal balance and accrued and unpaid
interest shall become due pursuant to Section 6(b) below. The Borrower also
promises to pay interest on the outstanding principal balance at the rates and
on the dates set forth in Section 2 below.

     1. Principal Payments. The outstanding principal balance of this Note shall
be repaid as follows: (a) One Million Two Hundred Thousand and 00/100 Dollars
($1,200,000.00) shall be payable in twelve (12) equal consecutive monthly
installments of One Hundred Thousand and 00/100 Dollars ($100,000.00) due on the
first day of each calendar month commencing on April 1, 2003; and (b) a final
payment of One Million Five Hundred Five Thousand Two Hundred Fifty and 00/100
Dollars ($1,505,250.00) due on April 1, 2004.

     2. Interest. Upon the occurrence and during the continuance of an Event of
Default (as defined in Section 6 below), the aggregate unpaid principal amount
of this Note shall bear interest at an annual rate equal to 8%.

     3. Payments. All interest and principal payments due under this Note shall
be made in lawful money of the United States of America to the Lender at the
principal office of the Lender as set forth below, or to such other address, or
by wire transfer to such account, as may be designated from time to time by the
Lender to the Borrower in writing.

     4. Optional Prepayment. The Borrower may, at any time, prepay the
outstanding principal balance of this Notein inverse order of maturity in whole
or in part without premium or penalty; provided, however, that in the event of
any such prepayment, the Borrower shall also pay all accrued and unpaid interest
on the principal amount prepaid. The Borrower may not reborrow the amount of any
such principal prepayment.

     5. Application of Payments. All payments on the indebtedness evidenced by
this Note shall be applied first to pay any and all costs incurred by or on
behalf of the holder hereof and next to pay interest hereon and finally to pay
principal.

     6. Event of Defaults; Remedies.

          (a) Event of Default. As used in this Note, an "Event of Default"
shall mean any one of the following:

<PAGE>

               (i) The Borrower shall: (A) become insolvent or take or fail to
take any action which constitutes an admission of inability to pay its debts as
they mature, (B) make a general assignment for the benefit of creditors or to an
agent authorized to liquidate any substantial amount of its assets, (C) become
the subject of an "order for relief" within the meaning of the United States
Bankruptcy Code, (D) file a petition in bankruptcy, or for reorganization, or to
effect a plan or other arrangement with creditors, (E) file an answer to a
creditor's petition, admitting the material allegations thereof, for an
adjudication of bankruptcy or for reorganization or to effect a plan or other
arrangement with creditors, (F) apply to a court for the appointment of a
receiver or custodian for any of its assets or properties, or (G) have a
receiver or custodian appointed for any of its assets or properties, with or
without consent, and such receiver shall not be discharged within sixty (60)
days after his appointment; or

               (ii) The Borrower dissolves or liquidates; or

               (iii) The Borrower shall fail to pay when due any installment of
the principal or interest under this Note;

               (iv) A default occurs under the Selective Business Security
Agreement referred to in Section 8 hereof; or

               (v) Any representation or warranty made or deemed made by or on
behalf of the Borrower to the Lender under or in connection with this Note, the
Selective Business Security Agreement referred to in Section 8 hereof, or any
certificate or information delivered in connection with this Note shall be
materially false on the date as of when made or delivered.

          (b) Remedies.

               (i) Upon the occurrence of any Event of Default, then without
notice, demand or action of any kind by the Lender, the entire amount of unpaid
principal and accrued and unpaid interest under this Note shall be automatically
and immediately due and payable.

               (ii) Upon the occurrence of an Event of Default, the Borrower
agrees to pay all reasonable fees and expenses incurred by the Lender, including
the reasonable fees of counsel, in connection with the protection and
enforcement of the rights of the Lender under this Note, including without
limitation the collection of any amounts due under this Note and the protection
and enforcement of such rights in any bankruptcy, reorganization or insolvency
proceeding involving the Borrower.

               (iii) No remedy herein conferred upon the Lender is intended to
be exclusive of any other remedy and each and every such remedy shall be
cumulative and shall be in addition to every other remedy given under this Note
or now or hereafter existing by law. No failure or delay on the part of the
Lender in exercising any right or remedy hereunder shall operate as a waiver
thereof nor shall any single or partial exercise of any right hereunder preclude
other or further exercise.

     7. Notices. All notices given hereunder shall be in Writing and (a)
delivered, (b) sent by express or first class mail, or (c) sent by facsimile to
the number set forth below, or to such other

                                      -2-

<PAGE>

address with respect to either party as such party shall notify the other in
writing; such notices shall be deemed given when delivered, mailed or
transmitted:

          If to the Borrower:

               Associated Hygienic Products LLC
               4455 River Green Parkway
               Duluth, GA 30096
               Facsimile No. (770) 623-8887

          If to the Lender:

               Curt G. Joa, Inc.
               100 Crocker Avenue
               Sheboygan Falls, WI 53085
               Facsimile No. (920) 467-2924

     8. Security. All of the obligations evidenced by this Note are secured by
that certain Selective Business Security Agreement of even date herewith from
the Borrower to the Lender.

     9. Waiver. The Borrower hereby waives presentment for payment, protest and
demand, notice of protest and demand.

     10. Waiver of Jury Trial: THE BORROWER (AND THE LENDER BY ACCEPTANCE OF
THIS NOTE) HEREBY AGREE THAT THE BORROWER AND THE LENDER IRREVOCABLY WAIVE ANY
AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR
RELATING TO THIS NOTE.

     11. Governing Law. This Note shall be governed by the substantive law of
the State of Wisconsin.

     12. No Violation. The Borrower represents that no agreement to which it is
a party would prohibit it from entering into this Note or enforcing any term of
this Note against it.

                                                ASSOCIATED HYGIENIC PRODUCTS LLC

                                                --------------------------------
                                                Its:
                                                     ---------------------------

                                      -3-

<PAGE>

<TABLE>
<S>                                                     <C>
UCC FINANCING STATEMENT
FOLLOW INSTRUCTIONS (front and back) CAREFULLY
==============================================
A. NAME & PHONE OF CONTACT AT FILER [optional]
   David L. Bourne
----------------------------------------------
B. SEND ACKNOWLEDGMENT TO: (Name and Address)

     David L. Bourne
     Quarles & Brady LLP
     411 E. Wisconsin Avenue
     Milwaukee, WI 53202
                                                        THE ABOVE SPACE IS FOR FILING OFFICE USE ONLY
====================================================================================================================================

1. DEBTOR'S EXACT FULL LEGAL NAME - insert only one debtor name (1a or 1b) - do not abbreviate or combine names

   ---------------------------------------------------------------------------------------------------------------------------------
   1a. ORGANIZATION'S NAME

   Associated Hygienic Products LLC
OR ---------------------------------------------------------------------------------------------------------------------------------
   1b. INDIVIDUAL'S LAST NAME                                 FIRST NAME                        MIDDLE NAME         SUFFIX

------------------------------------------------------------------------------------------------------------------------------------
1c. MAILING ADDRESS                                           CITY                              STATE  POSTAL CODE  COUNTRY

4455 River Green Parkway                                      Duluth                            GA     30096        U.S.A.
------------------------------------------------------------------------------------------------------------------------------------
1d. SEE INSTRUCTIONS  ADD'L INFO RE 1e. TYPE OF ORGANIZATION  1f. JURISDICTION OF ORGANIZATION  1g. ORGANIZATION ID #, if any
                      ORGANIZATION
                      DEBTOR                                  Delaware                                                      [ ] NONE
====================================================================================================================================
2. ADDITIONAL DEBTOR'S EXACT FULL LEGAL NAME - insert only one debtor name (2a or 2b) - do not abbreviate or combine names

   ---------------------------------------------------------------------------------------------------------------------------------
   2a. ORGANIZATION'S NAME

OR ---------------------------------------------------------------------------------------------------------------------------------
   2b. INDIVIDUAL'S LAST, NAME                                FIRST NAME                        MIDDLE NAME         SUFFIX

------------------------------------------------------------------------------------------------------------------------------------
2c. MAILING ADDRESS                                           CITY                              STATE  POSTAL CODE  COUNTRY

------------------------------------------------------------------------------------------------------------------------------------
2d. SEE INSTRUCTIONS  ADD'L INFO RE 2e. TYPE OF ORGANIZATION  2f. JURISDICTION OF ORGANIZATION  2g. ORGANIZATION ID #, if any
                      ORGANIZATION
                      DEBTOR                                                                                                [ ] NONE
====================================================================================================================================
3. SECURED PARTY'S NAME (or NAME of TOTAL ASSIGNEE of ASSIGNOR S/P)-insert only one secured party name (3a or 3b)

   ---------------------------------------------------------------------------------------------------------------------------------
   3a. ORGANIZATION'S NAME

   Curt G. Joa, Inc.
OR ---------------------------------------------------------------------------------------------------------------------------------
   3b. INDIVIDUAL'S LAST NAME                                 FIRST NAME                        MIDDLE NAME         SUFFIX

------------------------------------------------------------------------------------------------------------------------------------
3c. MAILING ADDRESS                                           CITY                              STATE  POSTAL CODE  COUNTRY

100 Crocker Avenue                                            Sheboygan Falls                   WI     53085        U.S.A.
====================================================================================================================================
4. This FINANCING STATEMENT covers the following collateral:

JOA Model J4-MV Baby Diaper Machine, Serial No. WM3270-1899 as offered on Quotation No. QW020159-E dated October 4, 2002.

====================================================================================================================================
5. ALTERNATIVE DESIGNATION [if applicable]: [ ] LESSEE/LESSOR [ ] CONSIGNEE/CONSIGNOR [ ] BAILEE/BAILOR [ ] SELLER/BUYER [ ]
   AG. LIEN [ ] NON-UCC FILING
====================================================================================================================================
6. [ ] This FINANCING STATEMENT is to be filed [for   7. Check to REQUEST SEARCH REPORT(S) [ ] All Debtors [ ] Debtor 1 [ ] Debtor 2
   record] [or recorded] in the REAL ESTATE RECORDS      on Debtor(s) [ADDITIONAL FEE]
   Attach Addendum                     [applicable]      [optional]
====================================================================================================================================
8. OPTIONAL FILER REFERENCE DATA

====================================================================================================================================
</TABLE>

FILING OFFICE COPY -- UCC FINANCING STATEMENT (FORM UCC1) (REV. 05/22/02)
WIUCCIPNAT - 10/01/02 C T CORPORATION SYSTEM

<PAGE>

                                    Annex B-3

                    Form Security Agreement for JOA Purchase

<PAGE>

                      SELECTIVE BUSINESS SECURITY AGREEMENT

                              1. SECURITY INTEREST

Wisconsin Bankers Association 1990                         Dated October  , 2002
                                                                        --

     The undersigned ("Debtor") grants Curt G. Joa, Inc. ("Lender") a security
interest in property, wherever located, checked in Section 2 ("Collateral") to
secure all debts, obligations and liabilities, Debtor to Lender arising out of,
credit contemporaneously granted by Lender to Debtor, ("Obligations").

                          2. DESCRIPTION OF COLLATERAL

One or more boxes must be checked.

     (a)  [ ]  All Collateral. If checked here, all equipment, fixtures,
               inventory (including all goods held for sale, lease or
               demonstration or to be furnished under contracts of service,
               goods leased to others, trade-ins and repossessions, raw
               materials, work in process and materials or supplies used or
               consumed in Debtor's business), documents relating to inventory,
               general intangibles, accounts, contract rights, chattel paper and
               instruments, now owned or hereafter acquired by Debtor (or by
               Debtor with spouse);
     (b)  [ ]  Scheduled Collateral. If checked here, all inventory, accounts,
               contract rights, equipment, general intangibles, instruments,
               documents of title and chattel paper described in the attached
               schedule and any additional schedules delivered by Debtor to
               Lender from time to time;
     (c)  [X]  Specific Collateral. If checked here, the following described
               property now owned or hereafter acquired by Debtor Joa Model
               J4-MV Baby Diaper Machine, Serial No. WM 3270-1899 as purchased
               under Purchase Order No. VNAMP 0000003546 dated Oct, 8, 2002
     (d)  [ ]  All Inventory. If checked here, all inventory and documents
               relating to inventory now owned or hereafter acquired by Debtor
               (or by Debtor with spouse), including all goods held for sale,
               lease or demonstration or to be furnished under contracts of
               service, goods leased to others, trade-ins and repossessions, raw
               materials, work in process and materials or supplies used or
               consumed in Debtor's business;
     (e)  [ ]  All Receivables. If checked here, all acoounts, contract rights,
               chattel paper and instruments now owned or hereafter acquired by
               Debtor (or by Debtor with spouse);
     (f)  [ ]  All equipment. If checked here, all equipment and fixtures now
               owned or hereafter acquired by Debtor (or by Debtor with spouse);
     (g)  [ ]  All General Intangibles. If checked here, all general intangibles
               now owned or hereafter acquired by Debtor (or by Debtor with a
               spouse);

and all additions and accessions to, all spare and repair parts, special tools,
equipment and replacements for, all returned or repossessed goods the sale of
which _______ to, and all proceeds and products of the foregoing.

                             3. DEBTOR'S WARRANTIES

     Debtor warrants that while any at the Obligations are unpaid:

     (a) Ownership. Debtor owns the Collateral free of all encumbrances and
security interests (except Lender's purchase money security interest and
Foothill Capital Corporation's security interest). No financing statement (other
than Lender's and Foothill Capital Corporation's) is on file covering the
Collateral. Debtor, acting alone (having obtained the prior written consent of
Foothill Capital Corporation), may grant a security interest in the Collateral.
     (f) Valid incorporation. Debtor is duly organized, validly existing and in
good standing under the laws of the state of Delaware and is licensed to do
business in Washington.
     (g) Other agreements. Debtor is not in default under any material agreement
for the payment of money.
     (h) Authority to contract. The execution and delivery of this Agreement and
any instruments evidencing Obligations will not violate or constitute a
____________ of Debtor's articles of incorporation, by-laws, partnership
agreement or any agreement or restriction to which Debtor is a party or is
subject.
     (i) Accuracy of information. All information, certificates or statements
given to Lender pursuant to this Agreement shall be true and complete when
given.
     (j) Addresses. The address of Debtor's place of business, or if Debtor has
more than one place of business, then the address of the Debtor's chief
executive office, is shown opposite Debtor's signature. The address where the
Collateral will be kept, if different from that appearing opposite Debtor's
signature, is 801 S.E. Assembly Avenue, Vancouver, NA 98661. Such locations
shall not be changed without prior written consent of Lender, but the parties
intend that the Collateral, wherever located, is covered by this Agreement.
     (k) Change of name or address. Debtor shall immediately advise Lender in
writing of any change in name of chief executive office.
     (l) Environmental laws. To the knowledge of the senior management of
Debtor, Debtor is in compliance with all federal, state or local laws,
regulations, ordinance or rules (collectively, "Environmental Laws"), other than
for such non-compliance as could not reasonably be expected to have a material
adverse effect on the business or operations of Debtor. Debtor shall indemnify
and hold harmless Lender, its directors, officers, employees and agents from all
loss, costs (including reasonable attorneys' fees and legal expenses),
liabilities and damages whatsoever directly or indirectly resulting from,
arising out of, or based upon Debtor's noncompliance with Environmental Laws at
any of its facilities or properties at which the Collateral is located.

                      5. PERSONS BOUND AND OTHER PROVISIONS

     This Agreement benefits Lender, its successor and assigns, and binds Debtor
and its successors and assigns. THIS AGREEMENT INCLUDES ADDITIONAL PROVISIONS ON
REVERSE SIDE.

                                                ASSOCIATED HYGIENIC PRODUCTS LLC

                                  (SEAL)   By:
----------------------------------            ----------------------------------

(--------------------------------------)   (-----------------------------------)
          TYPE OF ORGANIZATION                             (TITLE)

By:                                        *
   -------------------------------------    ------------------------------------

(--------------------------------------)
                 (TITLE)                   Address: 4455 River Green Parkway
                                                      See Section 3(_)
*
 ---------------------------------------            Duluth, GA 30096
                                           (County)
                                                   -----------------------------
*    Type or print name above.                       ORIGINAL BANK COPY

<PAGE>

                              ADDITIONAL PROVISIONS

                             6. SALE AND COLLECTIONS

     (a) Deposit with Lender. At any time Lender may require that all proceeds
of Collateral received by Debtor upon the disposition of the Collateral shall be
held by Debtor upon an express trust for Lender, shall not be commingled with
any other funds or property of Debtor and shall be turned over to Lender in
precisely the form received (but endorsed by Debtor if necessary for collection)
not later than the business day following the day of their receipt. All proceeds
of Collateral received by Lender upon the disposition of the Collateral directly
or from Debtor shall be applied against the Obligations in such order and at
such times as Lender shall determine.

                              7. DEBTOR'S COVENANTS

     Debtor agrees:

     (a) Maintenance of Collateral. Debtor shall; maintain the Collateral in
good condition and repair and not permit its value to be impaired: keep it free
from all liens, encumbrances and security interests (other than Lender's
security interest); defend it against all claims and legal proceedings by
persons other than Lender; pay and discharge when due all taxes, license fees,
levies, and other charges upon it; not sell, lease or otherwise dispose of it or
permit it to become a fixture or an accession to other goods, except for sales
or leases of inventory as provided in this Agreement, not permit it to be used
in violation of any applicable law, regulation or policy of insurance. Loss of
or damage to the Collateral shall not release Debtor from any of the
Obligations.
     (b) Insurance. Debtor shall keep the Collateral and Lender's interest in it
insured under policies with such provisions, for such amounts and by such
insurers as are typical in Debtor's business, and shall furnish evidence of such
insurance satisfactory to Lender. Debtor assigns (and directs any insurer to
pay) to Lender the proceeds of all such insurance, and authorizes Lender to
indorse in the name of Debtor any instrument for such proceeds and, at the
option of Lender, to apply such proceeds to any unpaid balance of the
Obligations, whether or not due, and/or to restoration of the Collateral,
returning any excess to Debtor.
     (c) Maintenance of security interest. Debtor shall pay all expenses and,
upon request, take any action reasonably deemed advisable by Lender to preserve
the Collateral or to establish, determine priority of, perfect, continue
perfected, terminate and/or enforce Lender's interest in it or rights under this
Agreement.
     (d) Taxes and other charges. Pay and discharge all lawful taxes,
assessments and government charges upon Debtor or against its properties prior
to the date on which penalties attach, unless and to the extent only that such
taxes, assessments and charges are contested in good faith and by appropriate
proceedings by Debtor.
     (e) Records and statements. Debtor shall furnish to Lender financial
statements and such other financial information respecting Debtor at such times
and in such form as Lender may reasonably request. Debtor shall keep accurate
and complete records respecting the Collateral in such form as Lender may
approve. At such times as Lender may reasonably require. Debtor shall furnish to
Lender a statement certified by Debtor and in such form and containing such
information as may be prescribed by Lender, showing the current status and value
of the Collateral.
     (f) Inspection of Collateral. Subject to Lender's execution and delivery to
Debtor of a confidentiality agreement in form and substance reasonably
satisfactory to Lender and Debtor, At reasonable times during normal business
hours Lender may examine the Collateral and Debtor's records pertaining to it,
wherever located, and make copies of record (except confidential or ________
records) Debtor shall assist Lender in so doing.
     (g) Service charge. In addition to the required payments under the
Obligations and this Agreement, Debtor will pay Lender's service charges in
respect of the Collateral as set forth on Exhibit A attached hereto if Debtor
requests such services and Lender provides such services.

                               8. RIGHTS OF LENDER

     (a) Authority to perform for Debtor. Upon the occurrence of an event of
default or it Debtor fails to perform any of Debtor's duties set forth in this
Agreement or in any evidence of or document relating to the Obligations, Lender
is authorized, in Debtor's name or otherwise, to take any such action including
without limitation signing Debtor's name or paying any amount so required, and
the cost shall be one of the Obligations secured by this Agreement and shall be
payable by Debtor upon demand with interest from the date of payment by Lender
at the highest rate stated in any evidence of any Obligation but not in excess
of the maximum rate permitted by law,
     (d) Non-liability of Lender. Lender has no duty to protect, insure, collect
or realize upon the Collateral or preserve rights in it against prior parties.
Debtor releases Lender from any liability for any act or omission relating to
the Obligations, the Collateral or this Agreement, except Lender's gross
negligence willful misconduct.

                                   9. DEFAULT

     Upon the occurrence of one or more of the following events of default,

     Nonperformance. Debtor fails to pay when due any of the Obligations or to
     perform, or rectify breach of, any warranty or other undertaking by Debtor
     in this Agreement or in any evidence of or document relating to the
     Obligations;

     Inability to Perform. Debtor or a surety for any of the Obligations ceases
     to exist, becomes insolvent or the subject of bankruptcy or insolvency
     proceedings;

     Misrepresentation. Any representation made to induce Lender to extend
     credit to Debtor, under this Agreement or otherwise, is false in any
     material respect when made

all of the Obligations shall, at the option of Lender and without any notice or
demand, become immediately payable; and Lender shall have all rights and
remedies for default provided by the Winsconsin Uniform Commercial Code, as well
as any other applicable law and any evidence of or document relating to any
Obligations. With repect to such rights and remedies.

     (a) Repossession. Lender may take possession of Collateral without notice
or hearing, which Debtor waives
     (b) Assembling Collateral. Lender may require Debtor to assemble the
Collateral and to make it available to Lender at any convenient place designated
by Lender.
     (c) Notice of disposition. Written notice, when required by law, sent to
any address of Debtor in this Agreement at least 10 calendar days (counting the
day of sending) before the date of a proposed disposition of the Collateral is
reasonable notice.
     (d) Expenses and application of proceeds. Debtor shall reimburse Lender for
any expense incurred by Lender in protecting or enforcing its rights under this
Agreement before and after judgment, including, without limitation, reasonable
attorneys' fees and legal expenses and all expenses of taking possession,
holding, preparing for disposition and disposing of the Collateral. After
deduction of such expenses, Lender may apply the proceeds of disposition to the
Obligations in such order and amounts as it elects; provided, that once the
Obligations have been satisfied in full, any excess proceeds shall be paid over
to Foothill Capital Corporation.
     (e) Waiver. Lender may permit Debtor to remedy any default without waiving
the default so remedied, and Lender may waive any default without waiving any
other subsequent or prior default by Debtor.

                               10. INTERPRETATION

     The validity, construction and enforcement of this Agreement are governed
by the internal laws of Wisconsin. All terms not otherwise defined have the
meanings assigned to them by the Wisconsin Uniform Commercial Code. Invalidity
of any provision of this Agreement shall not affect the validity of any other
provision. This Agreement is intended by the Debtor and Lender as a final
expression of this Agreement and as a complete and exclusive statement of its
terms, there being no conditions to the enforceability of this Agreement This
Agreement may not be supplemented or modified except in writing.

<PAGE>

                                                                       Illegible

                        [LETTERHEAD OF CURT G. JOA, INC.]

SERVICE RATES - EFFECTIVE JUNE 1, 2001

TECHNICAN:

Monday - Saturday    US$800/day (minimum) plus living and travel expenses.
                     US$100/hr. in excess of 8 hrs./day.
Sundays & Holidays   US$1000/day (minimum) plus living and travel expenses.
                     US$125/hr. in excess of 8 hrs./day.

ENGINEER:

Monday - Saturday    US$1000/day (minimum) plus living and travel expenses.
                     US$125/hr. in excess of 8 hrs./day.
Sundays & Holidays   US$1200/day (minimum) plus living and travel expenses.
                     US$150/hr. in excess of 8 hrs./day.

TRAVEL TIME (MINIMUM DAILY CHARGE APPLIES - SEE NOTE 2):

Monday - Friday               US$80/hr.
Saturday, Sunday & Holidays   US$100/hr.

WEEKENDS:            US$150/day plus living expenses for Saturday and Sunday
NOTES:               with no work.

     1.   Travel time and working time occurring on the same day will be
          combined to meet the minimum daily charge.

     2.   Minimum daily charge does not apply to travel time occurring on
          Saturday, Sunday, Holidays, or any day when the technician or engineer
          has worked eight (8) hours in the JOA Factory. In this case, only
          travel time will be billed.

     3.   Weekends and holidays are according to the U.S.A. and Joa calendars,
          unless otherwise agreed at the time service is requested.

     4.   Rates are subject to change and must be confirmed when the service is
          requested.

     5.   Overseas air travel is booked in Business Class. All other flights are
          booked in Coach Class, subject to availability.

     6.   Travel time is determined from the time leaving home, the job site or
          hotel and arriving at destination.

     7.   On extended visits, the technician or engineer is authorized to return
          home for a weekend every two (2) weeks within the continental U.S. and
          Canada or every four (4) weeks when working in any other location. All
          travel time and expenses are to Buyer's account.

                                                            CURT G. JOA, INC.

<PAGE>

                                 PROMISSORY NOTE

$2,705,250.00                                         Sheboygan Falls, Wisconsin
                                                               October   , 2002
                                                                       --

     FOR VALUE RECEIVED, ASSOCIATED HYGIENIC PRODUCTS LLC, a Delaware limited
liability company (the "Borrower") hereby promises to pay to the order of CURT
G. JOA, INC. (the "Lender"), the principal sum of TWO MILLION SEVEN HUNDRED FIVE
THOUSAND TWO HUNDRED FIFTY AND 00/100 DOLLARS ($2,705,250.00) plus accrued and
unpaid interest on or before April 1, 2004, in the manner set forth hereinafter,
or such earlier date as the outstanding principal balance and accrued and unpaid
interest shall become due pursuant to Section 6(b) below. The Borrower also
promises to pay interest on the outstanding principal balance at the rates and
on the dates set forth in Section 2 below.

     1. Principal Payments. The outstanding principal balance of this Note shall
be repaid as follows: (a) One Million Two Hundred Thousand and 00/100 Dollars
($1,200,000.00) shall be payable in twelve (12) equal consecutive monthly
installments of One Hundred Thousand and 00/100 Dollars ($100,000.00) due on the
first day of each calendar month commencing on April 1, 2003; and (b) a final
payment of One Million Five Hundred Five Thousand Two Hundred Fifty and 00/100
Dollars ($1,505,250.00) due on April 1, 2004.

     2. Interest. Upon the occurrence and during the continuance of an Event of
Default (as defined in Section 6 below), the aggregate unpaid principal amount
of this Note shall bear interest at an annual rate equal to 8%.

     3. Payments. All interest and principal payments due under this Note shall
be made in lawful money of the United States of America to the Lender at the
principal office of the Lender as set forth below, or to such other address, or
by wire transfer to such account, as may be designated from time to time by the
Lender to the Borrower in writing.

     4. Optional Prepayment. The Borrower may, at any time, prepay the
outstanding principal balance of this Notein inverse order of maturity in whole
or in part without premium or penalty; provided, however, that in the event of
any such prepayment, the Borrower shall also pay all accrued and unpaid interest
on the principal amount prepaid. The Borrower may not reborrow the amount of any
such principal prepayment.

     5. Application of Payments. All payments on the indebtedness evidenced by
this Note shall be applied first to pay any and all costs incurred by or on
behalf of the holder hereof and next to pay interest hereon and finally to pay
principal.

     6. Event of Defaults; Remedies.

          (a) Event of Default. As used in this Note, an "Event of Default"
shall mean any one of the following:

<PAGE>

               (i) The Borrower shall: (A) become insolvent or take or fail to
take any action which constitutes an admission of inability to pay its debts as
they mature, (B) make a general assignment for the benefit of creditors or to an
agent authorized to liquidate any substantial amount of its assets, (C) become
the subject of an "order for relief" within the meaning of the United States
Bankruptcy Code, (D) file a petition in bankruptcy, or for reorganization, or to
effect a plan or other arrangement with creditors, (E) file an answer to a
creditor's petition, admitting the material allegations thereof, for an
adjudication of bankruptcy or for reorganization or to effect a plan or other
arrangement with creditors, (F) apply to a court for the appointment of a
receiver or custodian for any of its assets or properties, or (G) have a
receiver or custodian appointed for any of its assets or properties, with or
without consent, and such receiver shall not be discharged within sixty (60)
days after his appointment; or

               (ii) The Borrower dissolves or liquidates; or

               (iii) The Borrower shall fail to pay when due any installment of
the principal or interest under this Note;

               (iv) A default occurs under the Selective Business Security
Agreement referred to in Section 8 hereof; or

               (v) Any representation or warranty made or deemed made by or on
behalf of the Borrower to the Lender under or in connection with this Note, the
Selective Business Security Agreement referred to in Section 8 hereof, or any
certificate or information delivered in connection with this Note shall be
materially false on the date as of when made or delivered.

          (b) Remedies.

               (i) Upon the occurrence of any Event of Default, then without
notice, demand or action of any kind by the Lender, the entire amount of unpaid
principal and accrued and unpaid interest under this Note shall be automatically
and immediately due and payable.

               (ii) Upon the occurrence of an Event of Default, the Borrower
agrees to pay all reasonable fees and expenses incurred by the Lender, including
the reasonable fees of counsel, in connection with the protection and
enforcement of the rights of the Lender under this Note, including without
limitation the collection of any amounts due under this Note and the protection
and enforcement of such rights in any bankruptcy, reorganization or insolvency
proceeding involving the Borrower.

               (iii) No remedy herein conferred upon the Lender is intended to
be exclusive of any other remedy and each and every such remedy shall be
cumulative and shall be in addition to every other remedy given under this Note
or now or hereafter existing by law. No failure or delay on the part of the
Lender in exercising any right or remedy hereunder shall operate as a waiver
thereof nor shall any single or partial exercise of any right hereunder preclude
other or further exercise.

     7. Notices. All notices given hereunder shall be in writing and (a)
delivered, (b) sent by express or first class mail, or (c) sent by facsimile to
the number set forth below, or to such other

                                      -2-

<PAGE>

address with respect to either party as such party shall notify the other in
writing; such notices shall be deemed given when delivered, mailed or
transmitted:

        If to the Borrower:

             Associated Hygienic Products LLC
             4455 River Green Parkway
             Duluth, GA 30096
             Facsimile No. (770) 623-8887

        If to the Lender:

             Curt G. Joa, Inc.
             100 Crocker Avenue
             Sheboygan Falls, WI 53085
             Facsimile No. (920) 467-2924

     8. Security. All of the obligations evidenced by this Note are secured by
that certain Selective Business Security Agreement of even date herewith from
the Borrower to the Lender.

     9. Waiver. The Borrower hereby waives presentment for payment, protest and
demand, notice of protest and demand.

     10. Waiver of Jury Trial: THE BORROWER (AND THE LENDER BY ACCEPTANCE OF
THIS NOTE) HEREBY AGREE THAT THE BORROWER AND THE LENDER IRREVOCABLY WAIVE ANY
AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR
RELATING TO THIS NOTE.

     11. Governing Law. This Note shall be governed by the substantive law of
the State of Wisconsin.

     12. No Violation. The Borrower represents that no agreement to which it is
a party would prohibit it from entering into this Note or enforcing any term of
this Note against it.

                                                ASSOCIATED HYGIENIC PRODUCTS LLC

                                                /s/ George H. Jackson
                                                --------------------------------
                                                Its: CHIEF EXECUTIVE OFFICER

                                      -3-

<PAGE>

                      SELECTIVE BUSINESS SECURITY AGREEMENT

                              1. SECURITY INTEREST

Wisconsin Bankers Association 1990                        Dated October   , 2002
                                                                        --

     The undersigned ("Debtor") grants Curt G. Joa, Inc., ("Lender") a security
interest in property, wherever located, checked in Section 2 ("Collateral") to
secure all debts, obligations and liabilities of Debtor to Lender arising out
of, credit contemporaneously granted by Lender to Debtor, ("Obligations").

                          2. DESCRIPTION OF COLLATERAL

One or more boxes must be checked.

     (a)  [ ]  All Collateral. If checked here, all equipment, fixtures,
               inventory (including all goods held for sale, lease or
               demonstration or to be furnished under contracts of service,
               goods leased to others, trade-ins and repossessions, raw
               materials, work in process and materials or supplies used or
               consumed in Debtor's business), documents relating to inventory,
               general intangibles, accounts, contract rights, chattel paper and
               instruments, now owned or hereafter acquired by Debtor (or by
               Debtor with spouse);
     (b)  [ ]  Scheduled Collateral. If checked here, all inventory, accounts,
               contract rights, equipment, general intangibles, instruments,
               documents of title and chattel paper described in the attached
               schedule and any additional schedules delivered by Debtor to
               Lender from time to time;
     (c)  [X]  Specific Collateral. If checked here, the following described
               property now owned or hereafter acquired by Debtor: Joa Model
               J4-MV Baby Diaper Machine, Serial No, WM 3270-1899 as purchased
               under Purchase Order No. VNAMP 4000003546 dated Oct, _, 2002
     (d)  [ ]  All Inventory. If checked here, all inventory and documents
               relating to inventory now owned or hereafter acquired by Debtor
               (or by Debtor with spouse), including all goods held for sale,
               lease or demonstration or to be furnished under contracts of
               service, goods leased to others, trade-ins and repossessions, raw
               materials, work in process and materials or supplies used or
               consumed in Debtor's business;
     (e)  [ ]  All Receivables. If checked here, all accounts, contract rights,
               chattel paper and instruments now owned or hereafter acquired by
               Debtor (or by Debtor with spouse);
     (f)  [ ]  All Equipment. If checked here, all equipment and fixtures now
               owned or hereafter acquired by Debtor (or by Debtor with spouse);
     (g)  [ ]  All General Intangibles. If checked here, all general intangibles
               now owned or hereafter acquired by Debtor (or by Debtor with
               spouse);

and all additions and accessions to, all spare and repair parts, special tools,
equipment and replacements for, all returned or repossessed goods the sale of
which _________ to, and all proceeds and products of the foregoing.

                             3. DEBTOR'S WARRANTIES

     Debtor warrants that while any of the Obligations are unpaid:

     (a) Ownership. Debtor owns the Collateral free of all encumbrances and
security interests (except Lender's purchase money security interest and
Foothill Capital Corporation's security interest). No financing statement (other
than Lender's and Foothill Capital Corporation's) is on file covering the
Collateral. Debtor, acting alone (having obtained the prior written consent of
Foothill Capital Corporation), may grant a security interest in the Collateral.
     (f) Valid incorporation. Debtor is duly organized, validly existing and in
good standing under the laws of the state of Delaware and is licensed to do
business in Washington.
     (g) Other agreements. Debtor is not in default under any material agreement
for the payment of money.
     (h) Authority to contract. The execution and delivery of this Agreement and
any instruments evidencing Obligations will not violate or constitute a _______
of Debtor's articles of incorporation, by-laws, partnership agreement or any
agreement or restriction to which Debtor is a party or is subject.
     (i) Accuracy of information. All information, certificates or statements
given to Lender pursuant to this Agreement shall be true and complete when
given.
     (j) Addresses. The address of Debtor's place of business, or if Debtor has
more than one place of business, then the address of the Debtor's chief
executive office, is shown opposite Debtor's signature. The address where the
Collateral will be kept, if different from that appearing opposite Debtor's
signature is 801 S.E. Assembly Avenue, Vancouver, NA 98661. Such locations shall
not be changed without prior written consent of Lender, but the parties intend
that the Collateral, wherever located, is covered by this Agreement.
     (k) Change of name or address. Debtor shall immediately advise Lender in
writing of any change in name of chief executive office.
     (l) Environmental laws. To the knowledge of the senior management of
Debtor, Debtor is in compliance with all federal, state or local laws,
regulations, ordinance or rules (collectively, "Environmental Laws"), other than
for such non-compliance as could not reasonably be expected to have a material
adverse effect on the business or operations of Debtor. Debtor shall indemnify
and hold harmless Lender, its directors, officers, employees and agents from all
loss, costs (including reasonable attorneys' fees and legal expenses),
liabilities and damages whatsoever directly or indirectly resulting from,
arising out of, or based upon Debtor's noncompliance with Environmental Laws at
any of its facilities or properties at which the Collateral is located.

                      5. PERSONS BOUND AND OTHER PROVISIONS

     This Agreement benefits Lender, its successor and assigns, and binds Debtor
and its successors and assigns. THIS AGREEMENT INCLUDES ADDITIONAL PROVISIONS ON
REVERSE SIDE.

                                           ASSOCIATED HYGIENIC PRODUCTS LLC

                                  (SEAL)   By: /s/ George H. Jackson
----------------------------------            ----------------------------------
                                              CHIEF EXECUTIVE OFFICER
(--------------------------------------)              (TITLE)
         TYPE OF ORGANIZATION

By:                                           GEORGE H. JACKSON III
   -------------------------------------   -------------------------------------

(--------------------------------------)
                 (TITLE)                   Address: 4455 River Green Parkway
                                                      See Section 3(_)
*
----------------------------------------            Duluth, GA 30096
                                           (County) GWINNETT

*    Type or print name above.                      ORIGINAL BANK COPY

<PAGE>

                              ADDITIONAL PROVISIONS

                             6. SALE AND COLLECTIONS

     (a) Deposit with Lender. At any time Lender may require that all proceeds
of Collateral received by Debtor upon the disposition of the Collateral shall be
held by Debtor upon an express trust for Lender, shall not be commingled with
any other funds or property of Debtor and shall be turned over to Lender in
precisely the form received (but endorsed by Debtor if necessary for collection)
not later than the business day following the day of their receipt. All proceeds
of Collateral received by Lender upon the disposition of the Collateral directly
or from Debtor shall be applied against the Obligations in such order and at
such times as Lender shall determine.

                              7. DEBTOR'S COVENANTS

     Debtor agrees:

     (a) Maintenance of Collateral. Debtor shall: maintain the Collateral in
good condition and repair and not permit its value to be impaired: keep it free
from all liens, encumbrances and security interests (other than Lender's
security interest); defend it against all claims and legal proceedings by
persons other than Lender: pay and discharge when due all taxes, license fees,
levies, and other charges upon it; not sell, lease or otherwise dispose of it or
permit it to become a fixture or an accession to other goods, except for sales
or leases of inventory as provided in this Agreement, not permit it to be used
in violation of any applicable law, regulation or policy of insurance. Loss of
or damage to the Collateral shall not release Debtor from any of the
Obligations.
     (b) Insurance. Debtor shall keep the Collateral and Lender's interest in it
insured under policies with such provisions, for such amounts and by such
insurers as are typical in Debtor's business; and shall furnish evidence of such
insurance satisfactory to Lender. Debtor assigns (and directs any insurer to
pay) to Lender the proceeds of all such insurance, and authorizes Lender to
indorse in the name of Debtor any instrument for such proceeds and, at the
option of Lender, to apply such proceeds to any unpaid balance of the
Obligations, whether or not due, and/or to restoration of the Collateral,
returning any excess to Debtor.
     (c) Maintenance of security interest. Debtor shall pay all expenses and,
upon request, take any action reasonably deemed advisable by Lender to preserve
the Collateral or to establish, determine priority of, perfect, continue
perfected, terminate and/or enforce Lender's interest in it or rights under this
Agreement
     (d) Taxes and other charges. Pay and discharge all lawful taxes,
assessments and government charges upon Debtor or against its properties prior
to the date on which penalties attach, unless and to the extent only that such
taxes, assessments and charges are contested in good faith and by appropriate
proceedings by Debtor.
     (e) Records and statements. Debtor shall furnish to Lender financial
statements and such other financial information respecting Debtor at such times
and in such form as Lender may reasonably request. Debtor shall keep accurate
and complete records respecting the Collateral in such form as Lender may
approve. At such times as Lender may reasonably require. Debtor shall furnish to
Lender a statement certified by Debtor and in such form and containing such
information as may be presented by Lender, showing the current status and value
of the Collateral.
     (f) Inspection of Collateral. Subject to Lender's execution and delivery to
Debtor of a confidentiality agreement in form and substance reasonably
satisfactory to Lender and Debtor. At reasonable times during normal business
hours Lender may examine the Collateral and Debtor's records pertaining to it,
wherever located and make copies of records (except confidential _____________
records) Debtor shall assist Lender in so doing.
     (g) Service charge. In addition to the required payments under the
Obligations and this Agreement, Debtor will pay Lender's service charges in
respect of the Collateral as set forth on Exhibit A attached hereto if Debtor
requests such services and Lender provides such services.

                               8. RIGHTS OF LENDER

     (a) Authority to perform for Debtor. Upon the occurrence of an event of
default or if Debtor fails to perform any of Debtor's duties set forth in this
Agreement or in any evidence of or document relating to the Obligations, Lender
is authorized, in Debtor's name or otherwise, to take any such action including
without limitation signing Debtor's name or paying any amount so required and
the cost shall be one of the Obligations secured by this Agreement and shall be
payable by Debtor upon demand with interest from the date of payment by Lender
at the highest rate stated in any evidence of any Obligation but not in excess
of the maximum permitted by law.
     (d) Non-liability of Lender. Lender has no duty to protect, insure, collect
or realize upon the Collateral or preserve rights in it against prior parties.
Debtor releases Lender from any liability for any act or omission relating to
the Obligations, the Collateral or this Agreement, except Lender's gross
negligence willful misconduct.

                                    9. DEFAULT

     Upon the occurrence of one or more of the following events of default,

     Nonperformance. Debtor fails to pay when due any of the Obligations or to
     perform, or rectify breach of, any warranty or other undertaking by Debtor
     in this Agreement or in any evidence of or document relating to the
     Obligations;

     Inability to Perform. Debtor, or a surety for any of the Obligations ceases
     to exist, becomes insolvent or the subject of bankruptcy or insolvency
     proceedings;

     Misrepresentation. Any representation made to induce Lender to extend
     credit to Debtor, under this Agreement or otherwise, is false in any
     material respect when made

all of the Obligations shall, at the option of Lender and without any notice or
demand, become immediately payable; and Lender shall have all rights and
remedies for default provided by the Wisconsin Uniform Commercial Code, as well
as any other applicable law and any evidence of or document relating to any
Obligation. With respect to such rights and remedies

     (a) Repossession. Lender may take possession of Collateral without notice
or hearing, which Debtor waives.
     (b) Assembling Collateral. Lender may require Debtor to assemble the
Collateral and to make it available to Lender at any convenient place designate
by Lender.
     (c) Notice of disposition. Written notice, when required by law, sent to
any address of Debtor in this Agreement at least 10 calendar days (counting the
day of sending) before the date of a proposed disposition of the Collateral is
reasonable notice.
     (d) Expenses and application of proceeds. Debtor shall reimburse Lender for
any expense incurred by Lender in protecting or enforcing its rights under this
Agreement before and after judgment, including, without limitation, reasonable
attorneys' fees and legal expenses and all expenses of taking possession,
holding, preparing for disposition and disposing of the Collateral. After
deduction of such expenses Lender may apply the proceeds of disposition to the
Obligations in such order and amounts as it elects; provided, that once the
Obligations have been satisfied in full, any excess procceds shall be paid over
to Foothill Capital Corporation.
     (e) Waiver. Lender may permit Debtor to remedy any default without waiving
the default so remedied, and Lender may waive any default without waving any
other subsequent or prior default by Debtor.

                               10. INTERPRETATION

     The validity, construction and enforcement of this Agreement are governed
by the internal laws of Wisconsin. All terms not otherwise defined have the
meanings assigned to them by the Wisconsin Uniform Commercial Code. Invalidity
of any provision of this Agreement shall not affect the validity of any other
provision. This Agreement is intended by the Debtor and Lender as a final
expression of this Agreement and as a complete and exclusive statement of its
terms, there being no conditions to the enforceability of this Agreement. This
Agreement may not be supplemented or modified except in writing.

<PAGE>

                        [LETTERHEAD OF CURT G. JOA, INC.]

SERVICE RATES - EFFECTIVE JUNE 1, 2001

TECHNICIAN:

Monday - Saturday    US$800/day (minimum) plus living and travel expenses.
                     US$100/hr. in excess of 8 hrs./day.
Sundays & Holidays   US$1000/day (minimum) plus living and travel expenses.
                     US$125/hr. in excess of 8 hrs./day.

ENGINEER:

Monday - Saturday    US$1000/day (minimum) plus living and travel expenses.
                     US$125/hr. in excess of 8 hrs./day.
Sundays & Holidays   US$1200/day (minimum) plus living and travel expenses.
                     US$150/hr. in excess of 8 hrs./day.

TRAVEL TIME (MINIMUM DAILY CHARGE APPLIES - SEE NOTE 2):

Monday - Friday               US$80/hr.
Saturday, Sunday & Holidays   US$100/hr.

WEEKENDS:            US$150/day plus living expenses for Saturday and Sunday
NOTES:               with no work.

     1.   Travel time and working time occurring on the same day will be
          combined to meet the minimum daily charge.

     2.   Minimum daily charge does not apply to travel time occurring on
          Saturday, Sunday, Holidays, or any day when the technician or engineer
          has worked eight (8) hours in the JOA factory. In this case, only
          travel time will be billed.

     3.   Weekends and holidays are according to the U.S.A. and Joa calendars,
          unless otherwise agreed at the time service is requested.

     4.   Rates are subject to change and must be confirmed when the service is
          requested.

     5.   Overseas air travel is booked in Business Class. All other flights are
          booked in Coach Class, subject to availability.

     6.   Travel time is determined from the time leaving home, the job site or
          hotel and arriving at destination.

     7.   On extended visits, the technician or engineer is authorized to return
          home for a weekend every two (2) weeks within the continental U.S. and
          Canada or every four (4) weeks when working in any other location. All
          travel time and expenses are to Buyer's account.

                                                       CURT G. JOA, INC.

                                                       /s/ George H. Jackson
                                                       -------------------------
                                                       11/14/02

<PAGE>

                               WAIVER AND CONSENT

     This WAIVER AND CONSENT (this "Waiver") is made and entered into as of
March 28, 2003, between ASSOCIATED HYGIENIC PRODUCTS LLC, a Delaware limited
liability company (the "Borrower"), and FOOTHILL CAPITAL CORPORATION, in its
capacity as administrative agent (the "Agent") for the Lenders (as defined
below).

                                   WITNESSETH:

     WHEREAS, the Borrower, the Lenders and the Agent have entered into that
certain Amended and Restated Loan and Security Agreement dated as of March 14,
2001, as amended by that certain First Amendment to Loan Agreement effective as
of May 28, 2001, that certain Second Amendment to Loan Agreement effective as of
July 5, 2001, that certain Third Amendment and Waiver to Loan Agreement dated as
of September 10, 2001, that certain Fourth Amendment to Loan Agreement dated as
of December 19, 2001, that certain Fifth Amendment to Loan Agreement dated as of
April 17, 2002, and that certain Sixth Amendment to Loan Agreement dated as of
November 14, 2002 (as amended and as the same may hereafter be modified,
amended, restated or supplemented from time to time, the "Loan Agreement"),
pursuant to which the Lenders have agreed to make loans and other financial
accommodations to the Borrower from time to time; and

     WHEREAS, the Borrower is required to deliver audited financial statements
for the Borrower and its Subsidiaries for each fiscal year no later than 90 days
after the end of each of its fiscal years pursuant to Section 6.3(b)(i) of the
Loan Agreement; and

     WHEREAS, the Borrower has informed the Agent that it will be unable to
deliver such financial statements for the fiscal year ending December 31, 2002,
within 90 days of such fiscal year end; and

     WHEREAS, the Borrower has requested that the Agent and the Lenders waive
the provisions of Section 6.3(b)(i) of the Loan Agreement with respect to such
financial statements and consent to an extension of the 90 day period to April
30, 2003; and

     WHEREAS, the Agent and the Lenders have agreed to the requested waiver and
consent on the terms and conditions set forth herein;

     NOW THEREFORE, in consideration of the foregoing premises and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree that all capitalized terms not otherwise
defined herein shall have the meanings ascribed to such terms in the Loan
Agreement and further agree as follows:

     1. Waiver and Consent. The Agent and the Lenders hereby waive the
provisions of Section 6.3(b)(i) of the Loan Agreement to the extent necessary to
permit the Borrower to deliver audited financial statements for the Borrower and
its Subsidiaries for the fiscal year ending December 31, 2002, no later than
April 30, 2003.

<PAGE>

     2. Representations and Warranties. The Borrower hereby represents and
warrants, for the benefit of the Agent and the Lenders, as follows:

          (a) The Borrower is a limited liability company organized, validly
existing and in good standing under the laws of the jurisdiction indicated at
the beginning of this Waiver and all other jurisdictions in which the failure to
be so qualified reasonably could be expected to constitute a Material Adverse
Change;

          (b) The execution, delivery, and performance by the Borrower of this
Waiver and the Loan Documents to which it is a party are within the Borrower's
limited liability company powers, have been duly authorized by all necessary
limited liability company action and do not and will not (i) violate any
provision of federal, state, or local law or regulation applicable to the
Borrower, the Governing Documents of the Borrower, or any order, judgment, or
decree of any court or other Governmental Authority binding on the Borrower,
(ii) conflict with, result in a breach of, or constitute (with due notice or
lapse of time or both) a default under any material contractual obligation of
the Borrower, (iii) result in or require the creation or imposition of any Lien
of any nature whatsoever upon any properties or assets of the Borrower, other
than Permitted Liens, or (iv) require any approval of the Borrower's members or
any approval or consent of any Person under any material contractual obligation
of the Borrower;

          (c) The execution, delivery and performance by the Borrower of this
Waiver and the Loan Documents to which it is a party do not and will not require
any registration with, consent or approval of, notice to, or other action with
or by, any Governmental Authority or other Person;

          (d) This Waiver and each other Loan Document to which the Borrower is
a party, and all other documents contemplated hereby and thereby, when executed
and delivered by the Borrower, will be the legally valid and binding obligations
of the Borrower, enforceable against the Borrower in accordance with their
respective terms, except as enforcement may be limited by equitable principles
or by bankruptcy, insolvency, reorganization, moratorium, or similar laws
relating to or limiting creditors' rights generally; and

          (e) After giving effect to this Waiver, no Default or Event of Default
is existing.

     3. No Other Waiver or Modification. Except for the waiver and consent set
forth herein, the text of the Loan Agreement and the Loan Documents shall remain
in full force and effect. The Borrower acknowledges and expressly agrees that
the Agent and the Lenders reserve the right to, and do in fact, require strict
compliance with all terms and provisions of the Loan Agreement and the other
Loan Documents.

     4. Counterparts. This Waiver may be executed in multiple counterparts, each
of which shall be deemed to be an original and all of which, taken together,
shall constitute one and the same agreement. In proving this Waiver in any
judicial proceedings, it shall not be necessary to produce or account for more
than one such counterpart signed by the party against whom such enforcement is
sought. Any

                                       2

<PAGE>

signatures delivered by a party by facsimile transmission shall be deemed an
original signature hereto.

     5. Loan Document. This Waiver shall be deemed to be a Loan Document for all
purposes.

     6. Costs and Expenses. The Borrower agrees to pay on demand all reasonable
costs and expenses in connection with the preparation, execution, and delivery
of this Waiver and the other instruments and documents to be delivered
hereunder, including, without limitation, the reasonable fees and out-of-pocket
expenses of counsel for the Agent with respect thereto and with respect to
advising the Agent as to its rights and responsibilities hereunder and
thereunder.

     7. Governing Law. This Waiver shall be deemed to be made pursuant to the
laws of the State of Georgia with respect to agreements made and to be performed
wholly in the State of Georgia, and shall be construed, interpreted, performed
and enforced in accordance therewith.

     8. Effectiveness. This Waiver shall be effective as of the date first
written above upon the Agent's receipt of (i) a counterpart hereof duly executed
by the Borrower and the Lenders, and (ii) such other documents executed by the
Borrower and Hygienic as the Agent may reasonably require.

                [Remainder of this page intentionally left blank]

                                       3

<PAGE>

     IN WITNESS WHEREOF, the parties hereto have executed this Waiver or caused
it to be executed by their duly authorized officers, effective as of the day and
year first written above.

BORROWER:                                       ASSOCIATED HYGIENIC PRODUCTS LLC

                                                By: /s/ Owen Connelly
                                                    ----------------------------
                                                Name: Owen Connelly
                                                Title: Vice President Accounting
                                                       & Finance

AGENT AND LENDER:                               FOOTHILL CAPITAL CORPORATION

                                                By: /s/ Kristy S. Loucks
                                                    ----------------------------
                                                Name: KRISTY S. LOUCKS
                                                Title: Vice President

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