FOURTH AMENDMENT
                               TO REVOLVING CREDIT
                             AND GUARANTY AGREEMENT

               FOURTH   AMENDMENT,   dated  as  of   September   28,  1998  (the
"AMENDMENT"), to the REVOLVING CREDIT AND GUARANTY AGREEMENT dated as of January
7,  1998  among  PARAGON  TRADE  BRANDS,   INC.,  a  Delaware  corporation  (the
"BORROWER"),   a  debtor  and  debtor-in-possession  under  Chapter  11  of  the
Bankruptcy  Code, the  Guarantors  named therein (the  "GUARANTORS"),  THE CHASE
MANHATTAN  BANK, a New York  banking  corporation  ("CHASE"),  each of the other
financial  institutions party thereto (together with Chase, the "BANKS") and THE
CHASE MANHATTAN BANK, as Agent for the Banks (in such capacity, the "AGENT"):

                              W I T N E S S E T H:



               WHEREAS,  the Borrower,  the Guarantors,  the Banks and the Agent
are parties to that certain Revolving Credit and Guaranty Agreement, dated as of
January  7, 1998 (as  heretofore  amended  pursuant  to the First  Amendment  to
Revolving Credit and Guaranty Agreement dated as of January 30, 1998, the Second
Amendment to Revolving Credit and Guaranty  Agreement dated as of March 23, 1998
and the Third Amendment to Revolving  Credit and Guaranty  Agreement dated as of
April 15, 1998 and as the same may be further amended,  modified or supplemented
from time to time, the "CREDIT AGREEMENT"); and

               WHEREAS, the Borrower and the Guarantors have requested that from
and after the Effective Date (as  hereinafter  defined) of this  Amendment,  the
Credit  Agreement be amended  subject to and upon the terms and  conditions  set
forth herein;

               NOW, THEREFORE, it is agreed:

          1. As used  herein all terms that are defined in the Credit  Agreement
shall have the same meanings herein.

          2. Section 6.09 of the Credit Agreement is hereby amended by inserting
the words (a) "and  in Section  6.13" immediately  following  the  parenthetical
phrase  "(the  "SECTION 6.09  AGREEMENTS")"  set forth  in  the  first  sentence
thereof, (b) "or any  of the Guarantors"  immediately  following  the words "the
Borrower" set forth in clause (y) of the second sentence  thereof,  and (c) "and
Section  6.11(iv)" immediately  following the words "Section 6.11(ii)" set forth
in subclause (y).

          3. Section 6.10 of the Credit Agreement is hereby  amended by deleting
the word "and" immediately  preceding clause (v) appearing therein and inserting
in lieu thereof a comma,  and by  inserting  the  following  new clause  (vi) at
the end thereof:

<PAGE>

               "and (vi) loans and advances, not to exceed one year in duration,
               to employees of the  Borrower and the  Guarantors  that are being
               relocated  and which are made in the ordinary  course of business
               in an aggregate  principal  amount not in excess of $1,000,000 at
               any one time outstanding."

          4. Section 6.11 of the Credit Agreement is hereby  amended by deleting
the word  "and" immediately  preceding  clause (iii) appearing  therein  and  by
inserting the following new clause (iv) at the end thereof:

               "and (iv) the sale or disposition, upon the terms of that certain
               Asset Purchase Agreement dated as of September 1, 1998, among the
               Borrower,  Changing  Paradigms,  Inc. ("CP") and House,  Home and
               Hardware,  LLC (or  pursuant to a higher and better offer that is
               approved by the  Bankruptcy  Court from such purchaser or another
               Person),  of  substantially  all of the assets (and assumption of
               certain trade payables) of CP."

          5.  Section 6 of the Credit  Agreement is hereby  amended by inserting
the following new Section 6.13 at the end thereof:

                      "SECTION    6.13    CHANGING    PARADIGMS     TRANSACTION.
               Notwithstanding  anything to the  contrary  set forth in Sections
               6.03,  6.09 and 6.10 of the Credit  Agreement , the Borrower,  CP
               and PTB International shall be permitted,  in connection with the
               sale of  substantially  all of CP's assets  described  in Section
               6.11(iv),  to enter  into a series of  intercompany  transactions
               pursuant   to  which  (x)  the   Borrower   may   assign  to  PTB
               International  an  intercompany  receivable  owing  by CP to  the
               Borrower  in the  amount of  approximately  $7,800,000,  with PTB
               International  to be obligated under an  intercompany  payable to
               the  Borrower  in  the  same  amount  in  consideration  of  such
               assignment  and (y) CP shall use the  proceeds of such asset sale
               to  repay  such  intercompany  receivable  owing  by  CP.  It  is
               understood  and agreed that such  intercompany  payable  from PTB
               International  to the Borrower  shall not be treated as a loan or
               advance by the Borrower to PTB  International for purposes of the
               formulas appearing in the "PROVIDED" clause of the first sentence
               of Section 6.09 and in the "PROVIDED" clause of Section 6.10."

          6. This  Amendment  shall  not become  effective  until  the date (the
"EFFECTIVE DATE") on  which this  Amendment  shall  have  been  executed  by the
Borrower,  the  Guarantors  and Banks  constituting  the Required  Banks and the
Agent,  and the  Agent shall  have received evidence  satisfactory to it of such
execution.


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<PAGE>


          7. The Borrower agrees that its obligations set forth in Section 10.05
of the  Credit Agreement shall extend to the preparation, execution and delivery
of this Amendment.

          8. This Amendment shall be limited  precisely as written and shall not
be deemed (a) to be a consent granted  pursuant to, or a waiver or  modification
of,  any  other  term or  condition  of  the  Credit  Agreement  or any  of  the
instruments  or agreements  referred to therein or (b) to prejudice any right or
rights which  the Agent or the Banks  may now have or have in the  future  under
or in  connection  with  the  Credit  Agreement or  any  of  the  instruments or
agreements  referred to therein. Whenever the Credit Agreement is referred to in
the Credit Agreement or any of the  instruments, agreements  or other  documents
or papers  executed or delivered in connection  therewith, such reference  shall
be deemed to mean the Credit Agreement as modified by this Amendment.

          9. This Amendment may be executed in any number of counterparts and by
the different  parties  hereto  in  separate  counterparts,  each of  which when
so  executed and  delivered  shall be deemed to be an original  and all of which
taken together shall constitute but one and the same instrument.

          10. This  Amendment  shall in all respects be construed in  accordance
with and  governed by the laws of the State of New York  applicable to contracts
made and to be performed wholly within such State.

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


                                    PARAGON TRADE BRANDS, INC.


                                    By:  /s/ 
                                    Title:

                                    PTB INTERNATIONAL, INC.


                                    By:  /s/
                                    Title:



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<PAGE>

                                    CHANGING PARADIGMS, INC.


                                    By:  /s/
                                    Title:

                                    PARAGON TRADE BRANDS FSC, INC.


                                     By:  /s/
                                    Title:

                                    PTB ACQUISITION SUB, INC.


                                    By:  /s/
                                    Title:

                                    THE CHASE MANHATTAN BANK,
                                    INDIVIDUALLY AND AS AGENT


                                    By:  /s/
                                    Title:

                                    AMSOUTH BANK


                                    By:  /s/
                                    Title:

                                    THE BANK OF NOVA SCOTIA


                                    By:  /s/
                                    Title:



                                       4
<PAGE>


                                    BHF-BANK AKTIENGESELLSCHAFT


                                    By:  /s/
                                    Title:

                                    By:  /s/
                                    Title:

                                    HELLER FINANCIAL, INC.


                                    By:  /s/
                                    Title:

                                    IBJ BUSINESS CREDIT CORPORATION


                                    By:  /s/
                                    Title:

                                    PNC BANK, NATIONAL ASSOCIATION


                                    By:  /s/
                                    Title:

                                    WACHOVIA, N.A.


                                    By:  /s/
                                    Title:



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