JPS Industries, Inc.

SUMMARY PLAN DESCRIPTION

For The

Flexible Benefits Program

Dependent Care Spending Account Program

Health Care Spending Account Program

Amended and Restated

Effective January 1, 2004

The Flexible Benefits Program

Expenses for insurance, health care, or day care costs may consume a significant portion of your yearly budget. JPS Industries, Inc. (“JPS”) has adopted several benefit plans which, taken together, are designed to help provide you and your family with financial assistance in meeting these expenses.

JPS sponsors three related benefit plans for its employees:

JPS Industries, Inc. Flexible Benefits Program

JPS Industries, Inc. Dependent Care Spending Account Program

JPS Industries, Inc. Health Care Spending Account Plan

This booklet describes the terms and benefits of these plans as of January 1, 2004. The JPS Industries, Inc. Flexible Benefits Program acts as an "umbrella" over several pretax benefit options, such as coverage under one of the Corporation's Group Medical Plans or Other Group Insurance Plans. The JPS Industries, Inc. Dependent Care Spending Account Program and the JPS Industries, Inc. Health Care Spending Account Program, which are under the umbrella, offer you the option to use before-tax dollars to pay certain expenses which you would otherwise pay with after-tax dollars. This plan structure provides you with a substantial reduction in the cost of each benefit. For purposes of this summary plan description, the JPS Industries, Inc. Flexible Benefits Program and its underlying expense reimbursement plans will be collectively referred to as the "Flexible Benefits Program" or the "Plan," unless the context indicates reference to a specific plan.

Under the Plan, you will be able to choose benefits that best fit your needs and those of your family. You may purchase benefits or be reimbursed for benefit expenses with a portion of your income before federal income or social security taxes are withheld. The money you set aside is also exempt from most state income taxes and, in some cases, local income taxes. Because your taxable income is reduced, you pay less in taxes--and that can mean more money for you to spend or save.

JPS wants you to be able to take advantage of every available benefit under the Plan to the extent appropriate for your situation. To do this, you must understand the many options available to you. This summary plan description is intended to present a general and informative overview of the Plan. You should read it carefully so that you understand the provisions of the Plan and the benefits available to you. We want you to be fully informed before you enroll in the Plan and while you are a Participant. You should direct any questions you have to the Plan Administrator.

There are Plan documents on file with the Plan Administrator which you may review if you desire. All matters of Plan administration are, in all respects, governed by the Plan documents. In the event there is a conflict between this summary plan description and the Plan documents, the Plan documents will control. JPS Industries, Inc. reserves the right to change or discontinue the Plan at any time.

Table of Contents

Flexible Benefits Program at a Glance........................................................................... 1

Joining the Plan........................................................................................................................ 3

Who is eligible to join the Plan?................................................................................................ 3

When may I join the Plan?........................................................................................................ 3

When are the election periods for our Plan?.............................................................................. 4

What is the enrollment procedure?............................................................................................ 4

May I change my elections during the plan year?....................................................................... 4

When will my participation in the Plan end?............................................................................... 7

What happens if my employment ends during a plan year?......................................................... 7

Contributions............................................................................................................................. 8

How are Group Medical Plan and Other Group Insurance Plan contributions made?.................. 8

How are health care spending account and dependent care spending account

contributions made?............................................................................................................. 8

How much may I elect to contribute to the Plan?....................................................................... 8

Do limitations apply to participants who are highly compensated?.............................................. 9

Will my reimbursement accounts earn interest?........................................................................ 10

What if I don’t spend the entire amount in my reimbursement accounts?................................... 10

Qualified Expenses................................................................................................................ 11

Health Care Spending Account............................................................................................... 11

Dependent Care Spending Account........................................................................................ 12

Pretax Premium Payment........................................................................................................ 13

Request for Reimbursement.............................................................................................. 14

How do I request reimbursement of health care or dependent care expenses?......................... 14

What if my request for reimbursement is denied?..................................................................... 15

COBRA Continuation Coverage..................................................................................... 18

What is “COBRA continuation coverage”?............................................................................. 18

Who are “Qualified Beneficiaries”?......................................................................................... 18

What is a “Qualifying Event”?................................................................................................. 18

Which Qualified Beneficiaries are eligible for COBRA continuation coverage?......................... 19

What notices are required for COBRA continuation coverage?............................................... 19

How do I elect COBRA continuation coverage?..................................................................... 19

How long can a Qualified Beneficiary continue COBRA coverage?......................................... 19

Your Rights Under ERISA................................................................................................. 20

Summary.................................................................................................................................... 22

Plan Summary List................................................................................................................ 23

Flexible Benefits Program at a Glance

Who Can Join

The Plan is generally for individuals who: (a) are active full-time or part-time employees of JPS Industries, Inc. and affiliated employers that adopt the Plan ("your employer"); and (b) normally work (or are paid) for at least 30 hours a week.

Elections

Before the beginning of each plan year, your employer will announce an election period. During the election period, you must complete an election form on which you may elect to set aside part of your pay to cover your estimated out-of-pocket costs for the benefits offered through the Flexible Benefits Program for the coming year. Your employer will set aside the amount you designate from your pay before federal and state income taxes and Social Security taxes are calculated.

Benefits You May Choose

You may choose to receive your entire salary in cash, or to have your employer apply a portion of your before-tax pay to one or more of the flexible benefits: