THIS FIFTH AMENDMENT TO CREDIT AGREEMENT (the "Fifth Amendment") dated

as of December ___, 2001, is to that Credit Agreement dated as of October

14, 1998, as amended by that certain First Amendment to Credit Agreement

dated May 21, 1999, as further amended by that certain Second Amendment to

Credit Agreement dated December 29, 1999, that certain Third Amendment to

Credit Agreement dated June 26, 2000 and that certain Fourth Amendment to

Credit Agreement dated February 14, 2001 (as may be subsequently amended

and modified from time to time, the "Credit Agreement"; terms used but not

otherwise defined herein shall have the meanings provided in the Credit

Agreement), by and among DAN RIVER INC., a Georgia corporation (the

"Borrower"), the Guarantors identified therein, the several banks and other

financial institutions identified therein (the "Lenders") and FIRST UNION

NATIONAL BANK, as administrative agent for the Lenders thereunder (in such

capacity, the "Administrative Agent"), BANK ONE, formerly The First

National Bank of Chicago, as syndication agent, and WACHOVIA BANK, N.A., as

documentation agent.





                                W I T N E S S E T H:



       WHEREAS, the Lenders have established a credit facility for the

benefit of the Borrower pursuant to the terms of the Credit Agreement;



       WHEREAS, the Borrower wishes to amend the Credit Agreement and certain

of the Security Documents to modify certain provisions contained therein;

and



       WHEREAS, the Lenders have agreed to the requested amendment on the

terms and conditions hereinafter set forth;



       NOW, THEREFORE, in consideration of the premises and other good and

valuable consideration, the receipt and sufficiency of which are hereby

acknowledged, the parties hereto agree as follows:



       A.     Amendments.  The Credit Agreement is amended in the following

respects (Section references contained herein being references to Sections

of the Credit Agreement unless otherwise indicated herein):



              1.     Section 1.1 is hereby amended as follows:



                  a.     Section 1.1 is hereby amended by making the additions

       and deletions set forth in bold below:



                     "Consolidated EBITDA" means, for any period, the sum of

              (i) Consolidated Net Income for such period, plus (ii) an amount

              which, in the determination of Consolidated Net Income for such

              period, has been deducted for (A) Consolidated Interest Expense,

              (B) total federal, state, local and foreign income taxes and

              similar taxes on income, (C) depreciation, amortization expense

              and other non-cash charges, (D) Cost Savings Add-Backs resulting

              from the acquisition of the Acquired Business, (E) other non-

              recurring, non-cash charges, (F) charges associated with



{PAGE}

{PAGE}     2





              restructuring, provided that the amount paid in cash referred to

              in this clause shall not, in the aggregate, exceed $2,000,000,

              (G) charges permitted to be amortized for the purpose of

              transitional funding of customer marketing programs and (H)

              other adjustments to Consolidated EBITDA reasonably acceptable to

              the Required Lenders.



                     "Interest Coverage Ratio" shall mean, with respect to the

              Borrower and its Restricted Subsidiaries for any period, the

              ratio of (a) Consolidated EBITDA for such period to (b)

              Consolidated Interest Expense for such period.



                     "Required Lenders" shall mean (i) Lenders holding in the

              aggregate not less than 51% (provided that (i) for any

              modification or waiver to the financial covenants in Section 5.9

              for the April 2002 financial covenant tests and October 2002

              financial covenant tests, such percentage shall be 75%, and

              (ii) for any other modification or waiver to the financial

              covenants in Section 5.9, such percentage shall be 66 2/3%) of

              all Revolving Loans and LOC Obligations then outstanding at such

              time plus the aggregate unused Revolving Commitments at such time

              (treating for purposes hereof in the case of Swingline Loans and

              LOC Obligations, in the case of the Swingline Lender and the

              Issuing Lender, only the portion of the Swingline Loans and the

              LOC Obligations of the Swingline Lender and the Issuing Lender,

              respectively, which is not subject to the Participation Interests

              of the other Lenders and, in the case of the Lenders other than

              the Swingline Lender and the Issuing Lender, the Participation

              Interests of such Lenders in Swingline Loans and LOC Obligations

              hereunder as direct Obligations) and (ii) Lenders holding in the

              aggregate not less than 51% (provided that (i) for any

              modification or waiver to the financial covenants in Section 5.9

              for the April 2002 financial covenant tests and October 2002

              financial covenant tests, such percentage shall be 75%, and

              (ii) for any other modification or waiver to the financial

              covenants in Section 5.9, such percentage shall be 66 2/3%) of

              all Term Loans then outstanding at such time; provided, however,

              that if any Lender shall be a Defaulting Lender at such time,

              then there shall be excluded from the determination of Required

              Lenders, Obligations (including Participation Interests) owing to

              such Defaulting Lender and such Defaulting Lender's Commitments,

              or after termination of the Commitments, the principal balance of

              the Obligations owing to such Defaulting Lender.



                  b.     Section 1.1 is hereby amended by amending the

       definition of "Applicable Percentage" by the addition of the following

       new level immediately above Level I:



{PAGE}

{PAGE}     3



{Table}

{Caption}

                                                               LIBOR RATE

                                    Alternate                  Margin for

                                    Base Rate                  Revolving

                                    Margin for                 Loans, Term

                                     Revolving                    Loans

                     Leverage      Loans and Term              and Letter of        Commitment

       Level           Ratio           Loans                     Credit Fee             Fee

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

       {S}           {C}           {C}                         {C}                  {C}



         A           }5.50 to             3.00%                4.25%                     .500%

                      1.0

{/Table}

                     c.     Section 1.1 is hereby amended by the deletion of the

       definition of "Interest Payment Date" and replacing it with the

       following:



                     "Interest Payment Date" shall mean (a) as to any Alternate

              Base Rate Loan or Swingline Loan, the last day of each calendar

              month and the applicable Maturity Date and (b) as to any LIBOR

              Rate Loan, the last day of each calendar month and the last day

              of each Interest Period applicable thereto.



                     d.     Section 1.1 is hereby amended by the addition of the

       following definitions thereto in the appropriate alphabetical order:



                  "Accounts" shall mean, as to any Person, all rights to

              receive payment for goods sold or leased by such Person or for

              services rendered in the ordinary course of business of such

              Person to the extent not evidenced by an instrument or chattel

              paper, including any rights in, to and under all purchase orders

              or receipts now owned or hereafter acquired for goods and

              services, and all collateral security and guarantees with respect

              to any of the foregoing.



                  "Advance Rate" shall mean, (a) with respect to Eligible

              Accounts, 85%, (b) with respect to Eligible Inventory, (i) 60%,

              in the case of raw materials and finished goods, (ii) 40%, in the

              case of work-in-progress and (iii) 15%, in the case of supplies;

              provided, that the foregoing advance rates may be modified from

              time to time in accordance with Section 2.1(b)(iv).



                  "Borrowing Base" shall mean, as of any Calculation Date, an

              amount equal to the sum of (i) the amount of Eligible Accounts at

              such date multiplied by the applicable Advance Rate and (ii) the

              amount of Eligible Inventory at such date multiplied by the

              applicable Advance Rate; provided that in no event can such

              amount exceed the sum of (i) 85% of the book value of the

              Borrower's consolidated accounts receivable and (ii) 55% of the

              book value of the Borrower's consolidated inventory.  The

              Borrowing Base shall be determined from time to time by the

              Administrative Agent in its reasonable judgment by reference to

Home        Intelligence        Services        Subscriptions        News        About Us

Contact Us       Terms of Use       Resend Documents       Shopping Cart

Copyright © 2008 The Consus Group LLC