The CIT Group/
Commercial Services, Inc,
1211 Avenue of the Americas
New York, NY 10036




                                                              March 31, 1998


Leslie Fay Marketing, Inc.
1412 Broadway
New York, New York 10018

Gentlemen:

Reference is made to the Revolving Credit Agreement between us, dated as of June
2, 1997, as supplemented and amended (herein the "Agreement"). Capitalized terms
used herein and  defined in the  Agreement  shall have the same  meanings as set
forth therein unless otherwise specifically defined herein.

Pursuant to mutual consent and understanding, effective as of April 1, 1998, the
following sections of Article X of the Agreement  entitled "Negative  Covenants"
shall be, and hereby are, amended as follows:

           1. (a) The  reference  in  subparagraph  (i) of Section  10.02 of the
Agreement to "clauses  (a)-(h)  above" shall be, and hereby is,  amended to read
"clauses (a)-(i) above",  and subparagraph  (i)shall  hereafter be renamed to be
subparagraph "(j)"; and

                      (b) The following new subparagraph "(i)" shall be added to
Section 10.02 prior to subparagraph (j) referenced above:

                      "(i) Liens related to an acquisition by the Borrower which
           acquisition has been previously approved, in writing, by CIT."

           2. (a) The  reference  in  subparagraph  (h) of Section  10.03 of the
Agreement to "clauses  (a)-(g)  above" shall be, and hereby is,  amended to read
"clauses  (a)-(h) above",  and subparagraph (h) shall hereafter be renamed to be
subparagraph "(i)"; and

                      (b) The following new subparagraph "(h)" shall be added to
Section 10.03 prior to subparagraph (i) referenced above:



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                                       -2-

                      "(h)  Indebtedness   related  to  an  acquisition  by  the
           Borrower which acquisition has been previously approved,  in writing,
           by CIT."

           3. (a) The  reference  in  subparagraph  (d) of Section  10.04 of the
Agreement to "clauses  (a)-(c)  above" shall be, and hereby is,  amended to read
"clauses  (a)-(d) above",  and subparagraph (d) shall hereafter be renamed to be
subparagraph "(e)"; and

                      (b) The following new subparagraph "(d)" shall be added to
Section 10.03 prior to subparagraph (e) referenced above:

                      "(d) guarantees and contingent  liabilities  related to an
           acquisition by the Borrower which  acquisition has been approved,  in
           writing, by CIT."

           4. The following new subparagraph  "(e)" shall be added to the end of
Section 10.05 of the Agreement:

                      "(e)  an  acquisition  by  the  Borrower  which  has  been
           previously approved, in writing, by CIT."

           5. The following  language shall be added to the end of Section 10.06
of the Agreement:

           ";  provided,  however,  the  Borrower  shall  be  permitted  to  pay
           dividends   or   repurchase   stock  in  the   aggregate   amount  of
           $5,000,000.00  in each of fiscal  year  1998 and  fiscal  year  1999,
           provided  that:  (1) at the time of, and after giving  effect to, the
           payment of  dividends  or  repurchase  of stock,  no Event of Default
           shall  have  occurred  and  be   continuing,   and  (2)  the  undrawn
           Availability   before  and  after  said  dividend  payment  or  stock
           repurchase shall not be less than $5,000,000.00."

           6.  The  following  subparagraph  "(d)"  shall be added to the end of
Section 10.09 of the Agreement:

           "(d) the Borrower may acquire the assets of an  affiliate,  provided,
           however,  such  acquisition is previously  approved,  in writing,  by
           CIT."

           7. The following  sentence shall be added to the end of Section 10.17
of the Agreement:

           "CIT will not unreasonably  withhold  approval to amend the foregoing
           ratios in the event a  violation  is solely  the result of a dividend
           payout


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                                       -3-

           or stock repurchase permitted in Section 10.06 hereinabove, and there
           are no other Events of Default that shall have occurred."

           8. The following  sentence shall be added to the end of Section 10.20
of the Agreement:

           "The unused portion of allowable  Capital  Expenditures in any fiscal
           year can be carried over to the next fiscal year."

Except to the extent specifically set forth herein, no other change or waiver of
any of the terms or provisions of the Agreement is intended or implied,  and all
of the terms and  conditions of the Agreement  shall  continue in full force and
effect.  This letter shall not  constitute  a waiver by us of any other  default
under the  Agreement,  whether  or not we have  knowledge  of same and shall not
constitute a waiver of any other defaults whatsoever.

If the  foregoing-is  in accordance  with your  understanding  of our agreement,
kindly so indicate by signing and returning the enclosed copy of this letter.

                                        Very truly yours,

                                        THE CIT GROUP/COMMERCIAL SERVICES, INC.


                                        By   /s/John Hendrickson
                                             Name:  John Hendrickson
                                             Title:   Vice President


Read and Agreed to:

LESLIE FAY MARKETING, INC.

By   /s/Warren Wishart
    Name
    Title