EXHIBIT 10(a)
**SIXTH AMENDMENT AND FORBEARANCE AGREEMENT**
**THIS SIXTH AMENDMENT AND FORBEARANCE AGREEMENT** (this "Agreement"), dated andeffective as of the 31st day of March, 2003 (the "Effective Date"), is by andamong **SPEIZMAN INDUSTRIES, INC.,** a Delaware corporation ("Speizman"), **SPEIZMANYARN EQUIPMENT, INC.,** a South Carolina corporation ("Speizman Yarn"), **WINK DAVISEQUIPMENT COMPANY, INC.,** a Georgia corporation ("Wink Davis"), **TODD MOTIONCONTROLS, INC.,** a North Carolina corporation ("Todd Motion;" and together with Speizman, Speizman Yarn, Wink Davis and any future direct or indirectsubsidiaries of Speizman or of any other entities listed above, the"Borrowers"), jointly and severally and their respective successors and assigns,and **SOUTHTRUST BANK**, an Alabama banking corporation("Lender").
**RECITALS :**
**WHEREAS**, Lender and the Borrowers entered into that certain Credit FacilityAgreement dated as of May 31, 2000 (as heretofore or hereafter amended,extended, restated or renewed, the "Credit Agreement"), for the purpose ofestablishing a $17,500,000 Revolving Credit Facility and a $15,000,000 Letter ofCredit Facility with the Lender in favor of the Borrowers.  All capitalizedterms used herein and not otherwise defined shall have the respective meaningsthereunto ascribed in the Credit Agreement.  All obligations, duties andliabilities of the Borrower from time to time existing under and pursuant to theCredit Agreement and the other Loan Documents are sometimes collectivelyreferred to herein as the "Obligations"; and
**WHEREAS**, the parties amended the Credit Agreement pursuant to that certainAmendment and Forbearance Agreement dated as of the 13th day ofNovember, 2000 (the "First Amendment"); and
**WHEREAS**, the parties further amended the Credit Agreement pursuant to thatcertain Second Amendment and Forbearance Agreement dated July 1, 2001 (the"Second Amendment"); and
**WHEREAS**, the parties further amended the Credit Agreement pursuant to thatcertain Third Amendment and Forbearance Agreement dated February 19, 2002 (the"Third Amendment"); and 
**WHEREAS**, the parties further amended the Credit Agreement pursuant to thatcertain Fourth Amendment and Forbearance Agreement dated July 31, 2002 (the"Fourth Amendment"); and 
**WHEREAS**, the parties further amended the Credit Agreement pursuant to thatcertain Fifth Amendment and Forbearance Agreement dated December 31, 2002 (the"Fifth Amendment;" and collectively with the First Amendment, the SecondAmendment, the Third Amendment and the Fourth Amendment, the"Amendments");
**WHEREAS**, pursuant to the Amendments, Lender’s outstanding commitmentunder the Revolving Credit Facility has been reduced to $15,000,000 (subject tothe borrowing base formula set forth in the Credit Facility as amended pursuantto the Amendments and herein, regarding availability under the Revolving CreditFacility), and the outstanding commitment under the Letter of Credit Facilityhas been reduced to  $6,000,000; and 
 
**WHEREAS**, the Borrowers have requested that the maturity of the CreditFacilities under the Credit Agreement be extended, that certain terms of theCredit Agreement be modified, and that Lender continue to forbear from takingremedial actions as a result of the Borrowers’ non-compliance with certaincovenants and warranties in the Credit Agreement (as more particularly describedin Section 2 below, the "Existing Noncompliance"); and
**WHEREAS**, the Lender is willing to accommodate the Borrowers and to continuethe forbearance requested by the Borrowers, but only upon the terms andconditions set forth in this Agreement;
**NOW, THEREFORE,** in consideration of the foregoing Recitals, which the partiesacknowledge to be true and correct in all material respects, the Borrowers andthe Lender agree as follows:
1.     **Certain Definitions**.  Notwithstandingany contrary meaning set forth in the Credit Agreement or in any other LoanDocument, the following terms shall have the meanings hereunto ascribed:

**"ExistingNoncompliance"** shall mean the Borrowers’ current and existing failure tocomply with Sections 10.16, 10.17, 10.18 and 10.19 of the Credit Agreement, asheretofore set forth in Sections 4.01(a), (c) and (d) of the SecondAmendment.
**"Forbearance Period"**shall mean the period of time commencing on the date of this Agreement, andending on December 31, 2003, subject to an earlier termination of theForbearance Period as provided in Section 3 of thisAgreement.

**"Obligations"** shall collectively mean all indebtedness or otherliabilities and obligations of the Borrowers to the Lender arising out of orsecured by the Loan Documents, including, without limitation (i) theBorrowers’ obligation to repay the principal amount of the Loans withinterest thereon as set forth in the Loan Documents, and (ii) theBorrowers’ obligation to pay all commitment fees, extension fees and otheragreed charges in connection with the Loans, and (iii) the Borrowers’obligation to pay certain legal fees, court costs and other costs of collectionas set forth herein and in the other Loan Documents, and (iv) theBorrowers’ obligation to pay and discharge any and all liens orencumbrances upon or tax liabilities with respect to the collateral described inthe Loan Documents, and (v) any and all indemnity obligations of the Borrowersin favor of the Lender set forth in any of the Loan Documents, and (vi) theBorrowers’ obligation timely to observe and perform all other covenantsand agreements set forth in the Loan Documents.

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2.     **Forebearance by Lender.**  The Borrowersacknowledge and agree that by virtue of the Existing Noncompliance, the Lenderis presently entitled to declare an Event of Default under the Credit Agreementand exercise its rights and remedies thereunder and under the related LoanDocuments.  In consideration of the representations, warranties, promises andcovenants of the Borrowers set forth in this Agreement, and the contemplatedfuture performance by the Borrowers of the terms hereof and of the other LoanDocuments, the Lender hereby agrees that during the Forbearance Period (asdefined below), Lender will not enforce or exercise any remedies available to itunder the Loan Documents with respect to the Existing Noncompliance, and willnot seek collection of the Loans from the Borrowers except as set forthherein.
3.     **Termination of Forebearance Period.**Notwithstanding the provisions of Section 2 above, the Forbearance Period shallautomatically terminate without further notice to the Borrowers or any otherperson (all notice otherwise required by the Loan Documents or otherwise beinghereby waived), if (i) any case or other proceeding is instituted by or againstBorrower or any of the Guarantors under any state or federal law relating to thebankruptcy or insolvency of debtors, including, without limitation, the UnitedStates Bankruptcy Code, 11 U.S.C. § 101 et seq., or (ii) any materialand substantial default, event of default or "Event of Default" (as defined inthe Loan Documents), occurs under any of the Loan Documents other than theExisting Noncompliance, or (iii) any of the acknowledgments, warranties, orrepresentations of Borrowers set forth herein shall be untrue or inaccurate inany material respect as of the date made, or (iv) any Borrower shall breach,default, or fail to perform any other obligation or agreement contained in thisAgreement.
4.     **Modification of Credit Facilities.**
(a)     The Credit Facility No. 1 Termination Date ishereby extended to December 31, 2003.  From the Effective Date of this Agreementthrough the Credit Facility No. 1 Termination Date, the Revolving CreditCommitment shall be a principal sum not to exceed the lesser of (i)$10,000,000.00 minus the amount outstanding under the Borrowers’ AutomatedClearinghouse payroll facility with Lender, or (ii) the Borrowing Base Amountless the amount outstanding under the Borrowers’ Automated Clearinghousepayroll facility with Lender.  The Borrowers hereby waive any further right torequest that any standby letters of credit be issued under Facility No. 1.Facility No. 1 shall continue to be administered in accordance with Article IIof the Credit Agreement, as amended by this Agreement.
(b)     The Credit Facility No. 2 Termination Date ishereby extended to December 31, 2003.  From the Effective Date of this Agreementthrough the Credit Facility No. 2 Termination Date, the aggregate maximumprincipal face amount of Documentary Letters of Credit which may be outstandingat any one time shall not exceed the sum of $7,500,000.00, subject to reductionas provided in Section 3.1 of the Credit Agreement.  Facility No. 2 shallcontinue to be administered in accordance with Article III of the CreditAgreement, as amended by this Agreement.
(c)     Immediately upon termination of theBorrowers’ existing Swap Agreement on June 3, 2003 (i) the Borrowers shallno longer be eligible for any further Swap Agreements, and (ii) all LIBOR Loansshall automatically be converted to Base Rate Loans.  The Borrowers agree that,from and after the date hereof, they shall no longer be eligible to elect thatany Loan be priced as a LIBOR Loan for a LIBOR period which would extend beyondJune 3, 2003.  From and after May 3, 2003, the Borrowers agree that they shallno longer be eligible to elect that any Loan be priced as a LIBOR Loan.
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(d)     Fromand after the Effective Date of this Agreement, the Applicable Margin for allBase Rate Loans shall be one hundred twenty-five (125) basis points (1.25%).Effective as of July 1, 2003, the Applicable Margin for all Base Rate Loansshall be increased to three hundred (300) basis points (3.00%).  Accordingly,the definition of "Applicable Margin" set forth in Section 1.6 of the CreditAgreement is hereby amended as set forth above.
(e)     In consideration of this Agreement, and theextension of maturity of Facility No. 1 and Facility No. 2 as herein set forth,the Borrowers agree to pay to Lender an extension fee in the amount of$150,000.00, which fee shall be fully earned by Lender, and shall be due andpayable by Borrowers, upon the execution and delivery of this Agreement.  In theevent that all outstanding Obligations of the Borrowers are paid in full, andall Credit Facilities are terminated in full, on or before June 30, 2003, theLender agrees that it shall refund the sum of $50,000.00 to the Borrowers.
(f)     From and after the Effective Date of thisAgreement, the Loan Documents shall each be construed and interpreted byreference to the foregoing modifications, mutatis mutandis, such that each andevery term, covenant, condition and agreement set forth in the Loan Documentsshall, to the extent of any direct conflict with the foregoing subsections (a)through (e), be deemed amended as the context may require.
5.     **Status of the Loan Documents.**Borrowers acknowledge and agree that this Agreement and each of the Amendmentsshall for all purposes be deemed to constitute "Loan Documents" as that term isdefined in the Credit Agreement.  Borrowers further acknowledge and agree that,except as expressly set forth in this Agreement, (i) this Agreement is notintended to be, and shall not be deemed or construed to be, a novation orrelease of the Loan Documents or any of them; (ii) except as expressly providedin this Agreement, this Agreement is not intended to be, and shall not be deemedor construed to be, a modification, amendment, or waiver of the Loan Documentsor any of them; (iii) neither this Agreement nor any payments made or otheractions taken pursuant to this Agreement shall be deemed to cure the ExistingNoncompliance unless and until all sums payable pursuant to the Loan Documentsare paid in full; (iv) except as otherwise expressly provided in this Agreement,Lender reserves all available rights and remedies, at law, in equity, and underthe Loan Documents, in connection with any default or event of default,including the Existing Noncompliance, whether now existing or hereafteroccurring, under the Loan Documents; and (v) all requirements in the LoanDocuments for notice by Lender to the Borrowers, or any of them, are herebywaived.
6.     **Reaffirmation of Obligations.**  TheBorrowers hereby ratify and affirm all terms and conditions of the LoanDocuments (as amended hereby).  The Borrowers acknowledge that, as amended andmodified by this Agreement: (i) the Loan Documents remain in full force andeffect, and (ii) the Loan Documents to which each is a party constitute thelegal, valid and binding obligations of the Borrowers, enforceable against eachof the Borrowers in accordance with their respective terms.  The Borrowershereby represent and warrant to Lender that as of the date hereof, the Borrowershave no defenses, setoffs, rights of recoupment, counterclaims or claims of anynature whatsoever in respect to the Loan Documents, and to the extent any suchdefenses, setoffs, rights of recoupment, counterclaims or claims may exist,whether known or unknown, the same are hereby expressly waived, released anddischarged.  Borrowers represent and warrant to Lender that the Loans continueto be secured by the Loan Documents, and that except with respect to theExisting Noncompliance, no Event of Default or default has occurred and iscontinuing under the Loan Documents, and no event has occurred or failed tooccur that, with the lapse of time, giving of notice or both, would constitutean Event of Default or default under the Loan Documents.
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7.     **Waiver and Release of Claims.**  Inconsideration of the Lender’s execution and delivery of this Agreement,and as a material inducement therefor, effective as of the date of thisAgreement the Borrowers do hereby release, remise and discharge Lender and itsaffiliates, parents, divisions, subsidiaries, successors, predecessors,stockholders, officers, directors, agents, employees, attorneys, successors, andassigns (Lender and such other parties being collectively referred to herein asthe "Released Parties"), of and from any and all claims, liabilities, actions,and causes of action, if any, of whatever kind or nature, which have existed orcurrently exist as of the date of this Agreement, arising out of or in any wayconnected with any occurrences, acts, omissions, or transactions involving,directly or indirectly, the Loan Agreement, or any of the Obligations, or anyother transactions or dealings between the Lender and any of theBorrowers.
8.     **Representations and Warranties.**Borrowers represent and warrant to Lender that: (i) each Borrower is acorporation duly organized, validly existing and in good standing under the lawsof the State of organization reflected in the heading of this Agreement, and hasfull power and authority to execute, deliver and perform this Agreement and theother Loan Documents, and the same have been duly authorized pursuant to allrequisite corporate action; (ii) this  Agreement and the other Loan Documentsconstitute valid and legally binding obligations of the Borrowers, enforceablein accordance with their respective terms, except as enforceability may belimited by bankruptcy, insolvency or similar laws affecting the enforcement ofcreditors’ rights generally, and general principles of equity; (iii) theexecution, delivery and performance by the Borrowers of this Agreement and theother Loan Documents, will not and did not violate, conflict with, or constituteany default under any law (including laws relating to usury), governmentregulation, or any other agreement or instrument binding upon the Borrowers; and(iv) no approval, authorization or other action by, or filing with, anygovernmental official, board or authority is required in connection with theexecution and delivery of this Agreement or any of the other Loan Documents, andthe performance of the provisions thereof, except such approvals andauthorizations as have been received, such actions as have been taken, and suchfilings as have been made; and (v) other than the Existing Noncompliance, theBorrowers are not in material breach or violation of any covenant, agreement orother Obligation under the Credit Agreement or any other Loan Document.
9.     **Governing Law; Jurisdiction.**  Thevalidity, interpretation, enforcement and effect of this Agreement and the otherLoan Documents (including, without limitation, provisions with respect tointerest, late charges, and interest on overdue installments), shall be governedby, and construed according to the laws of, the State of North Carolina.Lender’s principal place of business is located in Jefferson County,Alabama, and the Borrowers agree that this Agreement has been made and deliveredto Lender, and shall be held by Lender, at such principal place of business.  Byexecution and delivery of this Agreement, the Borrowers expressly andirrevocably assent and submit to the personal jurisdiction of the state andfederal courts presiding in and over Jefferson County, Alabama, in any legalaction or proceeding arising under, out of, or in any manner relating to thisAgreement or any other Loan Document, and acknowledge that the negotiation,execution and delivery of this Agreement constitute sufficient contacts with theState of Alabama for purposes of independently conferring such jurisdiction.The Borrowers further agree that the exclusive venue of any such legal action orproceeding arising out of or in any manner relating to this Agreement or anyother Loan Document shall be in the state and/or federal courts presiding in andover Jefferson County, Alabama, unless Lender shall, at its sole option, electto bring or permit the maintenance of any such action in another venue, and theBorrowers hereby waive any and all rights under any state or federal law toobject to such venue on grounds of forum non conveniens or otherwise.
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10.     **Waiver of Jury Trial.  BORROWERS ANDLENDER HEREBY MUTUALLY WAIVE ANY RIGHT THEY MAY HAVE TO A TRIAL BY JURY IN ANYLAWSUIT OR OTHER COURT ACTION RELATED TO THE THIS AGREEMENT, ANY OF THE LOANDOCUMENTS, ANY OBLIGATIONS ARISING THEREUNDER OR ANY TRANSACTION CONTEMPLATEDHEREBY OR THEREBY, INCLUDING, WITHOUT LIMITATION, IN RESPECT TO ANY CLAIM,COUNTERCLAIM, THIRD-PARTY CLAIM, DEFENSE, OR SET-OFF ASSERTED IN ANY SUCHLAWSUIT OR COURT ACTION.  ANY SUCH LAWSUIT OR COURT ACTION SHALL BE TRIEDEXCLUSIVELY TO A COURT WITHOUT A JURY.  THE BORROWERS SPECIFICALLY ACKNOWLEDGETHAT THEIR EXECUTION OF THIS WAIVER CONSTITUTES A MATERIAL PORTION OF THECONSIDERATION RECEIVED BY THE LENDER IN EXCHANGE FOR ITS ENTERING INTO THISAGREEMENT.**
11.     **Payment of Expenses**.  Borrowers agreeto pay all expenses, including reasonable attorneys’ fees, incurred byLender in connection with the negotiation and preparation of this Agreement.The Borrowers further agree that they shall pay on demand any and all furtherout-of-pocket costs or expenses hereafter incurred by Lender in connection withthe administration of the Loan Documents and/or the enforcement of theObligations, including reasonable attorneys’ fees.
12.     **Miscellaneous.**
(a)     Except as expressly set forth herein, Lendershall not by any act, delay, omission, or otherwise be deemed to have waived anyof its rights or remedies under this Agreement or any other Loan Document, andno waiver of any kind shall be valid unless in writing and signed by Lender.
(b)     All rights and remedies of Lender under theterms of this Agreement and the other Loan Documents and applicable statutes orrules of law shall be cumulative and may be exercised successively orconcurrently.  
(c)     Any provision in this Agreement or of any otherLoan Document which may be unenforceable or invalid under any law shall beineffective to the extent of such unenforceability or invalidity withoutaffecting the enforceability or validity of any other provision hereof orthereof.
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(d)     This Agreement and the obligations of theBorrowers hereunder shall be binding upon and enforceable against the Borrowersand their respective heirs, administrators, successors and assigns, and shallinure to the benefit of Lender and its successors and assigns, including anysubsequent holder of the Notes.
(e)     Lender may, at its option, release anycollateral given to secure the Obligations, or release any guarantor from itsobligations under any guaranty or surety agreement, and no such release shallimpair the Obligations of any Borrower to Lender under this Agreement and theother Loan Documents.
(f)     Section headings are inserted for convenienceof reference only and shall be disregarded in the interpretation of thisAgreement.
(g)     No provision of this Agreement shall beconstrued against or interpreted to the disadvantage of any party by reason ofsuch party’s having or being deemed to have drafted, structured ordictated the terms of such provision.
(h)     This Agreement may be executed in any number ofcounterparts bearing the original signatures of one or more of the partieshereto, each of which shall for all purposes be deemed an original, but all ofwhich, taken together, shall constitute one and the same Agreement.  It shallnot be necessary that all parties execute the same counterpart.
(i)     The Borrowers acknowledge that prior to theexecution and delivery of this Agreement they have had full and fair opportunityto review the same with independent legal counsel of their choosing, and thatthis Agreement has been executed and delivered as a free and voluntary act ofthe Borrowers, without coercion or duress.
(j)     Time is of the essence of this Agreement andthe performance of each of the covenants and agreements containedherein.
 
 
**[No further text this page; Signature pages follow.]**
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 IN WITNESS WHEREOF, the partieshereto have executed and delivered this Agreement, or have caused the same to beproperly executed and delivered, as of the day and year first above written.

 **BORROWERS:****LENDER:**** **** ****COMPANY AND SUBSIDIARIES:****LENDER:**** **** ****SPEIZMAN INDUSTRIES, INC. (SEAL)****SOUTHTRUST BANK (SEAL)**  By:/s/ Paul Demmink                                                  Paul Demmink               Title: Vice PresidentTBy:  /s/ Cole Taylor                                                  ColeTaylor              Title:   Vice President  **SPEIZMAN YARN EQUIPMENT, INC.(SEAL)**   By:  /s/ Paul Demmink                                                Paul Demmink          Title:   Vice President  
  **TODD MOTION CONTROLS, INC.(SEAL)**   By:  /s/ Paul Demmink                                                  Paul Demmink           Title:   Vice President   **WINK DAVIS EQUIPMENTCOMPANY, INC. (SEAL)**   By:  /s/ Paul Demmink                                                      Paul Demmink           Title:   Vice President 
 
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**STATE OF NORTH CAROLINA)                                                       )COUNTY OF MECKLENBURG)**

I, L. Gail Gormly, a Notary Public in and for said County in said State, herebycertify that Paul Demmink, whose name as Vice President of SPEIZMANINDUSTRIES, INC., a Delaware corporation, is signed to the foregoingForbearance Agreement, and who is known to me, acknowledged before me on thisday that, being informed of the contents of such instrument, he, as such officerand with full authority, executed the same voluntarily for and as the act ofsaid corporation.
Given under my hand and seal, this 1st day of April, 2003
  /s/ L. GailGormly                         NOTARY PUBLIC [SEAL]  My Commission Expires: November 11, 2005
 
**STATE OF NORTH CAROLINA)                                                        )      COUNTY OF MECKLENBURG)**

I, L. Gail Gormly, a Notary Public in and for said County in said State, herebycertify that Paul Demmink, whose name as Vice President of SPEIZMAN YARNEQUIPMENT, INC., a South Carolina corporation, is signed to the foregoingForbearance Agreement, and who is known to me, acknowledged before me on thisday that, being informed of the contents of such instrument, he, as such officerand with full authority, executed the same voluntarily for and as the act ofsaid corporation.
Given under my hand and seal, this 1st day of April, 2003 /s/ L. GailGormly                         NOTARY PUBLIC [SEAL]  My Commission Expires: November 11, 2005
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**STATE OF NORTH CAROLINA)                                                       )COUNTY OF MECKLENBURG)**

I, L. Gail Gormly, a Notary Public in and for said County in said State, herebycertify that Paul Demmink, whose name as Vice President of TODD MOTIONCONTROLS, INC., a North Carolina corporation, is signed to the foregoingForbearance Agreement, and who is known to me, acknowledged before me on thisday that, being informed of the contents of such instrument, he, as such officerand with full authority, executed the same voluntarily for and as the act ofsaid corporation.
Given under my hand and seal, this 1st day of April, 2003 /s/ L. GailGormly                         NOTARY PUBLIC [SEAL]  My Commission Expires: November 11, 2005
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**STATE OF NORTH CAROLINA)                                                       )COUNTY OF MECKLENBURG)**

 

I, L. Gail Gormly, a Notary Public in and for said County in said State, herebycertify that Paul Demmink, whose name as Vice President of WINK DAVISEQUIPMENT, INC., a Georgia corporation, is signed to the foregoingForbearance Agreement, and who is known to me, acknowledged before me on thisday that, being informed of the contents of such instrument, he, as such officerand with full authority, executed the same voluntarily for and as the act ofsaid corporation.
Given under my hand and seal, this 1st day of April, 2003
 
 /s/ L. GailGormly                         NOTARY PUBLIC [SEAL]  My Commission Expires: November 11, 2005
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**STATE OF ALABAMA       )                                              )COUNTY OF JEFFERSON)**

I, Terri Yavonne Williams, a Notary Public in and for said County in said State,hereby certify that Cole Taylor, whose name as Vice President of SOUTHTRUSTBANK is signed to the foregoing Forbearance, and who is known to me,acknowledged before me on this day that, being informed of the contents of suchinstrument, he, as such officer and with full authority, executed the samevoluntarily for and as the act of said SOUTHTRUST BANK.
Given under my hand and seal, this 1st day of April, 2003
 
 /s/ Terri Yavonne Williams                         NOTARY PUBLIC [SEAL]  My Commission Expires: February 5, 2005
 

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**EXHIBIT A**
**EBITDA PROJECTIONS**

 

 

 

 

 

 

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