##### 



Exhibit 10.43

LIMITED WAIVER AND THIRD AMENDMENT TO
FOURTH AMENDED AND RESTATED CREDIT AGREEMENT

This LIMITED WAIVER AND THIRD AMENDMENT TO FOURTH AMENDED AND RESTATED
CREDIT AGREEMENT (this Waiver and Amendment) is entered into as of this 11th
day of April, 2003 among WILSONS LEATHER HOLDINGS INC., a Minnesota corporation
(Borrower), GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware corporation, as
Lender, Term Lender, Swing Line Lender and as Agent (Agent), the Credit
Parties signatory hereto and the Lenders signatory hereto. Unless otherwise
specified herein, capitalized terms used in this Waiver and Amendment shall
have the meanings ascribed to them by the Credit Agreement (as hereinafter
defined).

RECITALS

WHEREAS, Borrower, certain Credit Parties, Agent and Lenders have entered
into that certain Fourth Amended and Restated Credit Agreement dated as of
April 23, 2002 (as amended, supplemented, restated or otherwise modified from
time to time, the Credit Agreement); and

WHEREAS, Borrower, the Credit Parties signatories to the Credit Agreement,
the Lenders and Agent wish to waive and amend certain provisions of the Credit
Agreement, as more fully set forth herein.

NOW THEREFORE, in consideration of the mutual covenants herein and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

Section 1      Limited Waiver.

The Agent and the Requisite Lenders hereby waive any breach or violation
of the Credit Agreement (and any resulting Event of Default) which has occurred
solely as a result of the failure to comply with the Minimum Fixed Charges
Coverage Ratio covenant set forth in clause (b) of Schedule I to the Credit
Agreement on or about the last day of January, 2003. This limited waiver shall
be limited precisely as written and shall not be deemed or otherwise construed
to constitute a waiver of any Default or Event of Default arising out of any
other failure of the Credit Parties to comply with the terms of the Credit
Agreement.

Section 2     Amendments to the Credit Agreement.

Subject to the
satisfaction of the conditions precedent set forth in Section 4 hereof, the parties hereto
hereby agree to amend the Credit Agreement as follows:

(a)     The last sentence of Section 1.1(a)(iv) of the Credit Agreement is
hereby amended and restated to read in its entirety as follows:





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| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | In addition, notwithstanding anything to the contrary contained
herein or otherwise, Borrower shall cause (i) at all times during the
period from and including December 31, 2003 through and including March
31, 2004 (x) the outstanding principal balance of the Revolving Credit
Advances and the Swing Line Loan to be reduced to, and remain at, zero
dollars ($0) and (y) the outstanding Letter of Credit Obligations to be
less than or equal to $20,000,000; (ii) at all times during the period
from and including April 1, 2004 through and including May 15, 2004 (x)
the outstanding principal balance of the Revolving Credit Advances and
the Swing Line Loan to be less than or equal to $15,000,000, and (y) the
outstanding Letter of Credit Obligations to be less than or equal to
$20,000,000; and (iii) at all times during the period from and including
December 31, 2004 through and including March 31, 2005 (x) the
outstanding principal balance of the Revolving Credit Advances and the
Swing Line Loan to be reduced to, and remain at, zero dollars ($0) and
(y) the outstanding Letter of Credit Obligations to be less than or equal
to $40,000,000.

(b)      Clause (a) of Section 1.5 of the Credit Agreement is hereby amended by
adding the following at the end thereof -



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | ; provided, that to the extent that the aggregate Revolving Loan
exceeds the amount of Revolving Loan that would have been available to
Borrower if the definition of Borrowing Base did not contain clause (e),
such excess shall be deemed to be utilized to make a Revolving Credit
Advance to the Borrower and such Revolving Credit Advance shall bear
interest at the Index Rate, at a per annum rate equal to the Index Rate
plus the Applicable Index Margin.

(c)      Section 1.6 of the Credit Agreement is hereby amended and restated to
read in its entirety as follows:



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 1.6      Applicable Margins.   The Applicable Swing Line Margin, Applicable
Index Margin, Applicable LIBOR Margin and Applicable L/C Margin will be
3.25%, 2.00%, 3.25% and 3.25% respectively and shall not be subject to
adjustment; provided, that to the extent that any portion of a Revolving
Credit Advance bears interest at the Index Rate as a result of the
proviso in Section 1.5(a), the Applicable Index Margin with respect
thereto shall be 5.00%.

(d)      Section 1.9 of the Credit Agreement is hereby amended by adding the
following new subsections (c) and (d) at the end thereof



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (c)       Borrower agrees to pay to Agent, for the ratable benefit of the
Lenders based on their Commitments, a funding fee in the aggregate amount
of $150,000 on the first date that the aggregate Revolving Loans exceed
the amount of Revolving Loan that would have been available to Borrower
if the definition of Borrowing Base did not contain clause (e) (Draw
Date) (which fee shall be fully earned and payable on the Draw Date).

2



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| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (d)     If Borrower pays after acceleration or reduces or terminates the
Revolving Loan Commitment, whether voluntarily or involuntarily and
whether before or after acceleration of the Obligations, or if any of the
Commitments are otherwise terminated, Borrower shall pay as liquidated
damages and compensation for the costs of being prepared to make funds
available hereunder to the Agent, for the ratable benefit of the Lenders
based upon their Revolving Loan Commitments, an amount equal to 1
multiplied by the amount of the reduction of the Revolving Loan
Commitment. Notwithstanding the foregoing, no prepayment fee shall be
payable by Borrower upon a mandatory prepayment made pursuant to Sections
1.3(a), 1.3(b), 1.3(d) or 1.16(c); provided, that in the case of
prepayments made pursuant to Sections 1.3(b) and 1.3(d), the
transaction giving rise to the applicable prepayment is expressly permitted under
Section 6.

(e)     The first sentence of Section 1.14(a) of the Credit Agreement is
hereby amended and restated to read in its entirety as follows:



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Borrower shall, and in accordance with the Guaranties, shall cause
each other Credit Party who is a signatory thereto to, during normal
business hours, from time to time upon one (1) Business Days prior
notice as frequently as Agent reasonably determines to be appropriate:
(a) provide Agent and any of its officers, employees and agents access to
its properties, facilities, advisors and employees (including officers)
of each Credit Party and to the Collateral, (b) permit Agent, and any of
its officers, employees and agents, to inspect, audit and make extracts
from any Credit Partys books and records, and (c) permit Agent, and its
officers, employees and agents, to inspect, review and evaluate the
Accounts, Inventory and other Collateral of any Credit Party; provided,
that Agent may perform Collateral audits not more than four times in each
year in the absence of an Event of Default (and, unless an Event of
Default has occurred and is continuing, Agent shall use good faith
efforts to provide at least five (5) Business Days notice of such audit,
which notice shall include a summary of the procedures to be followed in
such audit).

(f)     Section 5 of the Credit Agreement is hereby amended by adding the
following Section 5.12 thereto which shall read in its entirety as follows:



| |                                                                                                                                                                                                                                                                                                                                                                                           
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 5.12  Senior Notes Action Plan. No later than April 30, 2004,
Borrower shall deliver to Agent and the Lenders a written plan, in form
and substance satisfactory to Agent and the Lenders, which sets forth in
detail Borrowers proposed plan of action with respect to the amendment,
modification, refunding, renewal or extension of the Senior Notes
contemplated by Section 5.11. 

(g)     Clause
(b) of Section 8.1 of the Credit Agreement is hereby amended and
restated to read in its entirety as follows:

(b)   Any Credit Party shall fail or neglect to perform, keep or observe
any of the provisions of Sections 1.4, 1.8, 5.4, 5.11, 5.12 or 6, or any of the
provisions set forth in Schedules E or I, respectively.

3



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(h)     The following definitions which appear in Schedule A to the Credit
Agreement are hereby amended and restated to read in their entirety as follows:



| |                                                                          
| | -------------------------------------------------------------------------
| | Borrowing Base shall mean, as of any date of determination, the sum of:



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a)     85% of the book value of Eligible Inventory-Apparel (the
Eligible Inventory-Apparel Advance Rate); provided, that in no event
shall the Eligible Inventory-Apparel Advance Rate exceed the product of
(i) .85 multiplied by (ii) the then applicable NOLV of Inventory-Apparel
(provided that, solely for the purposes of this definition of Borrowing
Base, at all times on and after (x) August 17 but prior to October 1 of
each year, the NOLV of Inventory-Apparel shall be increased by an amount
equal to the product of (a) the number of full calendar weeks completed
since the then most recent August 17 multiplied by (b) one-sixth of the
difference between the NOLV of Inventory-Apparel as of October 1 and the
NOLV of Inventory-Apparel as of August 17 and (y) December 17 of any year
but prior to February 1 of the next year, the NOLV of Inventory-Apparel
shall be decreased by an amount equal to the product of (a) the number of
full calendar weeks completed since the then most recent December 17
multiplied by (b) one-sixth of the difference between the NOLV of
Inventory-Apparel as of December 17 and the NOLV of Inventory-Apparel as
of February 1.); plus



| |                                                                      
| | ---------------------------------------------------------------------
| | (b)     85% of the book value of Eligible Accounts at all times; plus



| |                                
| | -------------------------------
| | (c)     [Intentionally deleted]



| |                                                                                                                                                                                                                                                                                                                                            
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (d)     85% of the face amount of all then outstanding and undrawn
Eligible Trade L/Cs at all times (the Eligible Trade L/C Advance Rate);
provided, that in no event shall the Eligible Trade L/C Advance Rate
exceed 85% of the NOLV of the Inventory-Apparel, which shall exist upon a
draw on the applicable Eligible Trade L/C; plus



| |                                                     
| | ----------------------------------------------------
| | (e)     the Eligible Tax Refund Amount at such time;



| |                                                                                                                              
| | -----------------------------------------------------------------------------------------------------------------------------
| | less the Minimum Excess Availability Reserve and in each case less
any additional Reserve established by Agent at such time.



| |                                                                                                                                                                                                            
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Inventory-Apparel shall mean finished goods Inventory owned by
Borrower valued on a first-in, first-out basis in accordance with GAAP
(and as set forth on the Borrowers stock ledger perpetual system).



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Minimum Excess Availability Reserve shall mean a special Reserve
established by Agent on the Closing Date and maintained by Agent until
the Termination Date (1) with respect to Fiscal Year 2003 in an amount
equal to (x) $5,000,000 during the period from and including the first
day of the Fiscal Month of July, 2003 and through and including December
15, 2003 and (y) $10,000,000 at all other times during Fiscal Year 2003,
(ii) $5,000,000 during the Fiscal Months of

4



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| |                                                                                                                           
| | --------------------------------------------------------------------------------------------------------------------------
| | August, September, October, November in each of the Fiscal Years
2004 and 2005, and (iii) $10,000,000 at all other times.

(i)     Schedule A to the Credit Agreement is hereby amended by adding the
following new definitions in alphabetical order therein:



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Anticipated Tax Refund Amount means (i) prior to the proper filing
of the Borrowers United States Federal Income Tax Return for the tax
year ending August 2, 2003 (Tax Return), the amount, provided in a
writing satisfactory to the Agent by Ernst & Young LLP, as the amount of
the tax refund that will be due to the Borrower upon the filing of the
Borrowers Tax Return, and (ii) after the proper filing of the Borrowers
Tax Return, the amount reflected on audited financial statements of the
Borrower prepared in accordance with GAAP and delivered to the Agent and
certified by the Borrowers Chief Financial Officer and KPMG (and
accompanied by a letter from Ernst & Young LLP that acknowledges that the
Agent and the Lenders may rely upon such accounting firms
representation), as credit to income tax payable.



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Eligible Tax Refund Amount shall mean, during the period from and
including the first day of the Fiscal Month of September, 2003 through
and including the earlier of (a) the date that the Borrower receives any
or all of the Tax Refund or (b) December 15, 2003, an amount equal to the
lesser of (i) $15,000,000 or (ii) 85% of the Anticipated Tax Refund
Amount; provided, that prior to the proper filing of Borrowers Tax
Return, the Eligible Tax Refund Amount should not exceed the lesser of
(i) $6,000,000 or (ii) the product of $2,000,000 multiplied by the number
of calendar weeks which have then started since August 30, 2003.



| |                                                                                                                                                                                                                                                                                                 
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Tax Refund shall mean the amount of money received by the Borrower
as a result of the filing of (1) its United States Federal Income Tax
Return for the tax year ending August 2, 2003, and (2) a Net Operating
Loss (NOL) Carryback Return to the Borrowers tax year ended July 28,
2001.

(j)     Clause
(a) of Schedule H to the Credit Agreement is hereby amended and
restated to read in its entirety as follows:



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a)     (i)     To Agent, upon its request and no less frequently than
weekly, by 12:00 p.m. (Chicago time) on Wednesday of each week, a
Borrowing Base Certificate with respect to Borrower, accompanied by such
supporting detail and documentation as shall be requested by Agent in its
reasonable discretion, which shall be prepared by the Borrower as of the
last Friday of the immediately preceding week or the date 2 days prior to
the date of any such request; and



| |                                                                                                                                                                                                                                                                                                                                                                                                                             
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (ii)     To Agent, upon its request and no less frequently than monthly,
within 5 Business Days after the end of each Fiscal Month, with respect
to Borrower, a summary of Inventory by location and type with a
supporting perpetual Inventory report, in each case accompanied by such
supporting detail and documentation as shall be requested by Agent in its
reasonable discretion, each of which shall be prepared by

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| |                                                                                                                                     
| | ------------------------------------------------------------------------------------------------------------------------------------
| | the Borrower as of the last day of the immediately preceding Fiscal
Month or the date 2 days prior to the date of any such request.

(k)     Clause (g) of Schedule H to the Credit Agreement is hereby amended and
restated to read in its entirety as follows:



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (g)     Borrower, at its own expense, shall deliver to Agent at least
four times in each year, at such times as requested by Agent, an
appraisal of Borrowers assets as of the last day of the Fiscal Month
preceding such request (or such other time as requested by the Agent),
provided, that (i) such appraisals shall be conducted by an appraiser
selected by Agent and consented to by Borrower (which consent cannot be
unreasonably withheld by Borrower), and shall be in form and substance,
reasonably satisfactory to Agent; (ii) Borrower may, within 30 days
following the receipt by Borrower of such appraisal, dispute the
assumptions set forth therein by delivery of a written notice to Agent
(Notice of Dispute); (iii) Agent shall use good faith efforts to
resolve such dispute with Borrower within 15 days following the receipt
by Agent of the Notice of Dispute, and (iv) until a resolution has been
reached with respect to the assumptions in question, Agent, in its sole
discretion, may implement Reserves to reflect the going-out-of-business
appraisal then most recently delivered to Agent. Notwithstanding the
foregoing, if an Event of Default has occurred or is continuing, Agent
may select the appraiser without the consent of Borrower and items
(ii)-(iv) above shall not be applicable.

(1)     Clause (a) of Schedule I to the Credit Agreement is hereby amended and
restated to read in its entirety as follows:

(a)     Maximum Capital Expenditures. The Credit Parties on a
consolidated basis shall not make Capital Expenditures during the
following periods that exceed in the aggregate the amounts set forth
opposite each of such periods:

|                                               |  |                         |             | 
|---------------------------------------------- |  | ----------------------- | ----------- | 
|                                               |  | Maximum Capital        
|Period                                         |  | Expenditures per Period
|                                               |  |                        
|Fiscal Year ending in January of 2004 and 2005 |  | $                       | 10,000,000  | 
|Each Fiscal Year thereafter                    |  | $                       | 30,000,000 | 

(m)     Clause (b) of Schedule I to the Credit Agreement is hereby amended and
restated to read in its entirety as follows:



| |                                                                                                                                                                                                                                                              
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (b)     Minimum Fixed Charges Coverage Ratio. Ultimate Parent shall
have, on a consolidated basis, at the end of each Fiscal Quarter set
forth below for the four Fiscal Quarters then ended, a Fixed Charges
Coverage Ratio of not less than the following:

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|                                               |  |                |  | 
|---------------------------------------------- |  | -------------- |  | 
|                                               |  | Fixed Charges 
|Fiscal Quarter Ending:                         |  | Coverage Ratio
|                                               |  |               
|On or about the last day of April, 2004 and on |  | 1.0 to 1.0    
|the last day of each Fiscal Quarter thereafter |  |                |  | 



| |                                                                                                                                                                                                                                                            
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The Fixed Charges Coverage Ratio will in each case be measured based
on the Borrowers internal quarterly financial statements, which
statements shall be submitted by Borrower to Agent within forty-five
(45) days after the end of each Fiscal Quarter.
| |                                                                                                                                                                                                                                                            
| | (n)     Clause (c) of Schedule I to the Credit Agreement is hereby amended and
restated to read in its entirety as follows:                                                                                                                                



| |                                                                                                                                                                                                                                                                                                                    
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (c)     Minimum EBITDA. Ultimate Parent shall have, at the end of each
Fiscal Month set forth below, for the period commencing on February 2,
2003 and ending on the last day of the specified Fiscal Month below,
EBITDA for such period, of not less than the amount set forth opposite
such Fiscal Month below:

|               |  |        |            |  
|-------------- |  | ------ | ---------- | -
|Month          |  | EBITDA
|               |  |       
|March 2003     |  | ($     | 7,204,000  | )
|April 2003     |  | ($     | 16,938,000 | )
|May 2003       |  | ($     | 26,378,000 | )
|June 2003      |  | ($     | 39,530,000 | )
|July 2003      |  | ($     | 50,292,000 | )
|August 2003    |  | ($     | 58,866,000 | )
|September 2003 |  | ($     | 63,440,000 | )
|October 2003   |  | ($     | 60,443,000 | )
|November 2003  |  | ($     | 45,090,000 | )
|December 2003  |  | $      | 27,634,000 |  
|January 2004   |  | $      | 26,771,000 | 

| |                                                                                                                        
| | -----------------------------------------------------------------------------------------------------------------------
| | (o)     Schedule I to the Credit Agreement is hereby amended by adding the
following new clause (d) at the end thereof:



| |                                                                                                                                                                                                                                                                                                                                                                               
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (d)     Maximum and Minimum Inventory Level Covenant. During the
Fiscal Year ending in January 2004, Borrower shall maintain finished
goods Inventory and In-Transit Inventory with an aggregate book value (i)
not to exceed the maximum amounts set forth below and (ii) not to be less
than the minimum amounts set forth below, measured at the end of each
Fiscal Month:

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|               |  |                |             |                |  |   |             |  
|-------------- |  | -------------- | ----------- | -------------- |  | - | ----------- | -
|Fiscal Month   |  | Maximum Amount |             | Minimum Amount
|               |  |                |             |               
|March 2003     |  | $              | 98,074,000  |                |  | $ | 75,785,000  |  
|April 2003     |  | $              | 92,542,000  |                |  | $ | 71,510,000  |  
|May 2003       |  | $              | 99,566,000  |                |  | $ | 76,937,000  |  
|June 2003      |  | $              | 106,960,000 |                |  | $ | 82,651,000  |  
|July 2003      |  | $              | 117,232,000 |                |  | $ | 90,588,000  |  
|August 2003    |  | $              | 134,393,000 |                |  | $ | 103,849,000 |  
|September 2003 |  | $              | 160,892,000 |                |  | $ | 124,325,000 |  
|October 2003   |  | $              | 194,978,000 |                |  | $ | 150,665,000 |  
|November 2003  |  | $              | 181,258,000 |                |  | $ | 140,063,000 |  
|December 2003  |  | $              | 104,922,000 |                |  | $ | 81,076,000  |  
|January 2004   |  | $              | 96,507,000  |                |  | $ | 74,574,000  | 

Section 3      Representations and Warranties.

Borrower and the Credit Parties who are party hereto represent and warrant
that:

(a)     the execution, delivery and performance by Borrower and such Credit
Parties of this Waiver and Amendment have been duly authorized by all necessary
corporate action and this Waiver and Amendment is a legal, valid and binding
obligation of Borrower and such Credit Parties enforceable against Borrower and
such Credit Parties in accordance with its terms, except as the enforcement
thereof may be subject to (i) the effect of any applicable bankruptcy,
insolvency, reorganization, moratorium or similar law affecting creditors
rights generally and (ii) general principles of equity (regardless of whether
such enforcement is sought in a proceeding in equity or at law);

(b)     each of the representations and warranties contained in the Credit
Agreement is true and correct in all material respects on and as of the date
hereof as if made on the date hereof, except to the extent that such
representations and warranties expressly relate to an earlier date;

(c)     neither the execution, delivery and performance of this Waiver and
Amendment nor the consummation of the transactions contemplated hereby does or
shall contravene, result in a breach of, or violate (i) any provision of
Borrowers or Credit Parties certificate or articles of incorporation or
bylaws, (ii) any law or regulation, or any order or decree of any court or
government instrumentality or (iii) indenture, mortgage, deed of trust, lease,
agreement or other instrument to which Borrower, the Credit Parties or any of
their Subsidiaries is a party or by which Borrower, the Credit Parties or any
of their Subsidiaries or any of their property is bound, except in any such
case to the extent such conflict or breach has

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been waived by a written waiver document, a copy of which has been
delivered to Agent on or before the date hereof; and

(d)     no Default or Event of Default will exist or result after giving
effect hereto.

Section 4      Conditions to Effectiveness.

This Waiver and Amendment will be effective only upon satisfaction of the
following:

(a)     Execution and delivery of this Waiver and Amendment by Borrower, the
Credit Parties that are listed on the signature pages hereto, the Agent and the
Lenders;

(b)     Execution and delivery of the Reaffirmation of Guaranty dated as of
the date hereof by the Credit Parties and Store Guarantors that are parties
thereto;

(c)     Payment to each Lender executing this Amendment of an amendment fee
equal to half of one percent (.50%) of such Lenders Commitment as of the date
hereof (which fee shall be fully earned and payable on the date hereof); and

(d)     The representations and warranties contained herein shall be true and
correct in all respects.

Section 5      Reference to and Effect Upon the Credit Agreement.

(a)     Except as specifically set forth herein, the Credit Agreement and the
other Loan Documents shall remain in full force and effect and are hereby
ratified and confirmed.

(b)     The execution, delivery and effectiveness of this Waiver and Amendment
shall not operate as a waiver of any right, power or remedy of Agent or any
Lender under the Credit Agreement or any Loan Document, nor constitute a waiver
of any provision of the Credit Agreement or any Loan Document, except as
specifically set forth herein. Upon the effectiveness of this Waiver and
Amendment, each reference in the Credit Agreement to this Agreement,
hereunder, hereof, herein or words of similar import shall mean and refer
to the Credit Agreement as amended hereby.

Section 6      Waiver and Release.

In consideration of the foregoing, each of Borrower and each Credit Party
hereby waives, releases and covenants not to sue Agent or any Lender with
respect to any and all claims it may have against Agent or any Lender, whether
known or unknown, arising in tort, by contract or otherwise prior to the date
hereof relating to one or more Loan Documents.

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|           |                                                                                                                                                                                                                                                                                            
|---------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Section 7  | Costs and Expenses.                                                                                                                                                                                                                                                                        
|          
|           | As provided in Section 11.3 of the Credit Agreement, Borrower agrees to
reimburse Agent for all fees, costs and expenses, including the fees, costs and
expenses of counsel or other advisors for advice, assistance, or other
representation in connection with this Waiver and Amendment.
|          
|Section 8  | Governing Law.                                                                                                                                                                                                                                                                             
|          
|           | THIS WAIVER AND AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE INTERNAL LAWS OF THE STATE OF ILLINOIS.                                                                                                                                                                
|          
|Section 9  | Headings.                                                                                                                                                                                                                                                                                  
|          
|           | Section headings in this Waiver and Amendment are included herein for
convenience of reference only and shall not constitute a part of this Waiver
and Amendment for any other purposes.                                                                                                   
|          
|Section 10 | Counterparts.                                                                                                                                                                                                                                                                              
|          
|           | This Waiver and Amendment may be executed in any number of counterparts,
each of which when so executed shall be deemed an original but all such
counterparts shall constitute one and the same instrument.                                                                                
|          
|Section 11 | Confidentiality.                                                                                                                                                                                                                                                                           
|          
|           | The matters set forth herein are subject to Section 11.18 of the Credit
Agreement, which is incorporated herein by reference.                                                                                                                                                              

[signature page follows]

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IN WITNESS WHEREOF, this Waiver and Amendment has been duly executed as of
the date first written above.

|                                   |  |                                         
|---------------------------------- |  | ----------------------------------------
|                                   |  | BORROWER:                               
|                                   |  |                                         
|                                   |  | WILSONS LEATHER HOLDINGS INC.           
|                                   |  |                                         
|                                   |  | By: /s/ Peter G. Michielutti            
|                                   |  |                                         
|                                   |  | Title: Executive Vice President & CFO   
|                                   |  |                                         
|Revolving Loan Commitment:         |  | GENERAL ELECTRIC CAPITAL                
|$50,000,000 (including $10,000,000 |  | CORPORATION, as Agent, Lender and       
|Swing Line Commitment)             |  | Swing Line Lender                       
|                                   |  |                                         
|Term Loan B Commitment:            |  | By: /s/ Donna H. Evans                  
|$30,000,000                        |  |                                         
|                                   |  | Title: Duly Authorized Signatory        
|                                   |  |                                         
|Revolving Loan Commitment:         |  | LASALLE RETAIL FINANCE, a division      
|$30,000,000                        |  | of LaSalle Business Credit, as agent for
|                                   |  | Standard Federal Bank National          
|                                   |  | Association, as Lender                  
|                                   |  |                                         
|                                   |  | By: /s/ Robert Barnhard                 
|                                   |  |                                         
|                                   |  | Title: Senior Vice President            
|                                   |  |                                         
|Revolving Loan Commitment:         |  | THE CIT GROUP/BUSINESS CREDIT,          
|$45,000,000                        |  | INC. as Lender and Documentation Agent  
|                                   |  |                                         
|                                   |  | By: /s/ Deborah Rogut                   
|                                   |  |                                         
|                                   |  | Title: Vice President                   

[Signature Page to Limited Waiver and Third Amendment]

11



---



##### 



|                           |  |                                
|-------------------------- |  | -------------------------------
|Revolving Loan Commitment: |  | WELLS FARGO RETAIL FINANCE LLC,
|$45,000,000                |  | as Lender and Syndication Agent
|                           |  |                                
|                           |  | By: /s/ Kathy A. Mahoney       
|                           |  |                                
|                           |  | Title: Vice President          
|                           |  |                                
|Revolving Loan Commitment: |  | U.S. BANK NATIONAL ASSOCIATION,
|$10,000,000                |  | as Lender                      
|                           |  |                                
|                           |  | By: /s/ Jaqueline Ryan         
|                           |  |                                
|                           |  | Title: Vice President          

[Signature Page to Limited Waiver and Third Amendment]

12



---



##### 



The undersigned are executing this Waiver and Amendment in their capacity
as Credit Parties:

|                                     
|-------------------------------------
|Wilsons The Leather Experts Inc.     
|                                     
|By: /s/ Peter G. Michielutti         
|                                     
|Title: Executive Vice President & CFO
|                                     
|Wilsons Center, Inc.                 
|                                     
|By: /s/ Peter G. Michielutti         
|                                     
|Title: Executive Vice President & CFO
|                                     
|Rosedale Wilsons, Inc.               
|                                     
|By: /s/ Peter G. Michielutti         
|                                     
|Title: Executive Vice President & CFO
|                                     
|River Hills Wilsons, Inc.            
|                                     
|By: /s/ Peter G. Michielutti         
|                                     
|Title: Executive Vice President & CFO
|                                     
|Bermans The Leather Experts Inc.     
|                                     
|By: /s/ Peter G. Michielutti         
|                                     
|Title: Executive Vice President & CFO

[Signature Page to Limited Waiver and Third Amendment]

13