FIRST AMENDMENT TO CREDIT AGREEMENT


      THIS FIRST  AMENDMENT TO CREDIT  AGREEMENT dated as of March 29, 1999 (the
"Agreement") is entered into among Worldtex,  Inc., a Delaware  corporation (the
"Borrower"),  the Domestic  Subsidiaries  of the Borrower,  as  Guarantors,  the
Lenders party thereto and  NationsBank,  N.A., as Agent.  All capitalized  terms
used herein and not otherwise  defined  herein shall have the meanings  given to
such terms in the Credit Agreement (as defined below).

                                    RECITALS

      WHEREAS, the Borrower,  the Guarantors,  the Lenders and the Agent entered
into that certain Credit  Agreement dated as of December 1, 1997 (as amended and
modified from time to time, the "CREDIT AGREEMENT");

      WHEREAS,  the Borrower has  requested and the Lenders have agreed to amend
certain terms of the Credit Agreement as set forth below;

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

            1.    AMENDED DEFINITIONS.

            (a) The pricing grid in the  definition of  "APPLICABLE  PERCENTAGE"
      set forth in Section  1.1 of the Credit  Agreement  is hereby  amended and
      restated in its entirety to read as follows:
<TABLE>
<CAPTION>
                                            Applicable 
                                            Percentage
                                               For
                                            Eurodollar   Applicable   Applicable   
                                            Loans and    Percentage   Percentage   Applicable  
                                             CD Rate        For          For       Percentage      
                                            Loans and      Base       Letter of       For      
         Pricing       Leverage             Swingline      Rate         Credit       Unused
          Level         Ratio                 Loans        Loans         Fees         Fees      
          -----         -----                 -----        -----         ----         ----      

         <S>         <C>                    <C>          <C>          <C>           <C> 
            I        greater than             2.50%        1.25%        2.50%         .50%
                     6.25 to 1.0 
  
           II        less than or equal       2.25%        1.0%         2.25%         .50%
                     to 6.25 to 1.0          
                     but greater than 
                     5.25 to 1.0

           III       less than or equal       1.75%        .75%         1.75%        .375%
                     to 5.25 to 1.0 but 
                     but greater than 
                     4.25 to 1.0

<PAGE>

            IV       less than or equal       1.50%        .50%         1.50%        .30%
                     to 4.25 to 1.0 but
                     greater than 3.0 
                     to 1.0

            V        less than or equal       1.25%        .25%         1.25%        .25%
                     to 3.0 to 1.0 but 
                     greater than 2.0
                     to 1.0

            VI       less than or equal        1.0%          0%          1.0%        .20%
                     to 2.0 to 1.0      
</TABLE>

            (b) The  definition  of  "REQUIRED  LENDERS"  is hereby  amended and
      restated in its entirety to read as follows:

            "REQUIRED  LENDERS" means (i) until such time as there are three (3)
      Lenders  party  to  the  Credit  Agreement,  Lenders  which  are  then  in
      compliance with their  obligations  hereunder (as determined by the Agent)
      and holding in the aggregate  100% of (a) the  Commitments  and (b) if the
      Commitments have been terminated,  the outstanding Loans and Participation
      Interests (including the Participation  Interests of the Issuing Lender in
      any  Letters of Credit)  and (ii) at such time as there are at least three
      (3)  Lenders  party to the  Credit  Agreement,  Lenders  which are then in
      compliance with their  obligations  hereunder (as determined by the Agent)
      and holding in the aggregate at least 67% of (a) the  Commitments  and (b)
      if the  Commitments  have  been  terminated,  the  outstanding  Loans  and
      Participation  Interests  (including  the  Participation  Interests of the
      Issuing Lender in any Letters of Credit). For purposes of this definition,
      NationsBank,   N.A.  and  Bank  of  America  National  Trust  and  Savings
      Association will be considered one Lender.

            (c) A definition of "YEAR 2000 COMPLIANT" is hereby added to Section
      1.1 of the Credit Agreement and shall read as follows:

            "YEAR 2000 COMPLIANT"  shall have the meaning  assigned to such term
      in Section 6.18.

      2. YEAR 2000 COMPLIANCE.  A new Section 6.18 is hereby added to the Credit
Agreement and shall read as follows:

            6.18  YEAR 2000 COMPLIANCE.

            Each of the Credit Parties has (i) initiated a review and assessment
      of all  areas  within  its and each of its  Subsidiaries'  businesses  and
      operations (including those affected by suppliers,  vendors and customers)
      that could be adversely  affected by the "Year 2000 Problem" (that is, the
      risk that computer  applications may not be able to recognize and properly
      perform date-sensitive  functions after December 31, 1999), (ii) developed
      a plan and  timeline  for  addressing  the Year 2000  Problem  on a timely
      basis,  and (iii) to date,  implemented  that plan in accordance with that
      timetable.  Based on the  foregoing,  each Credit Party  believes that all
      computer  applications  (including  those of its  suppliers,  vendors  and
      customers) that are material to its or any of its  Subsidiaries'  business
      and  operations  are  reasonably  expected on a timely basis to be able to
      perform properly  date-sensitive  functions for all dates before and after
      January 1, 2000 (that is, be "Year 2000 Compliant"),  except to the extent
      that a  failure  to do so  could  not  reasonably  be  expected  to have a
      Material Adverse Effect.


<PAGE>

      3.  LEVERAGE  RATIO.  Section  7.9(a) of the  Credit  Agreement  is hereby
amended and restated in its entirety to read as follows:

            (a)   LEVERAGE RATIO.

            There  shall be  maintained  with  respect to the  Borrower  and its
      Subsidiaries  as of the end of each  fiscal  quarter  to occur  during the
      periods shown, a Leverage Ratio less than:

            (i)   From March 31, 1999 to  and  including June 29, 1999, 7.65  to
                  1.0;

            (ii)  From June 30, 1999 to and including  September 29, 1999,  6.85
                  to 1.0;

            (iii) From  September 30, 1999 to and  including  December 30, 1999,
                  6.50 to 1.0;

            (iv)  From December 31, 1999 to and including  March 30, 2000,  5.60
                  to 1.0;

            (v)   From March 31, 2000  to  and  including June 29, 2000, 4.0  to
                  1.0;

            (vi)  From  June 30, 2000  to  and including December 30, 2000, 3.75
                  to 1.0; and

            (vii) From December 31, 2000 and thereafter, 3.6 to 1.0.

      4. INTEREST  COVERAGE  RATIO.  Section  7.9(b) of the Credit  Agreement is
hereby amended and restated in its entirety to read as follows:

            (b)   INTEREST COVERAGE RATIO.

            There  shall be  maintained  with  respect to the  Borrower  and its
      Subsidiaries  as of the end of each  fiscal  quarter  to occur  during the
      periods shown, an Interest Coverage Ratio greater than:

            (i)   From  March 31, 1999 to and  including June 29, 1999, 1.35  to
                  1.0;

            (ii)  From June 30, 1999 to and including  September 29, 1999,  1.50
                  to 1.0;

            (iii) From  September 30, 1999 to and  including  December 30, 1999,
                  1.60 to 1.0;

            (iv)  From December 31, 1999 to and including  March 30, 2000,  1.80
                  to 1.0;

            (v)   From March 31, 2000 to and including  September 29, 2000,  2.5
                  to 1.0; and

            (vi) From September 30, 2000 and thereafter, 2.6 to 1.0.

<PAGE>

      5. NET WORTH. Section 7.9(d) of the Credit Agreement is hereby amended and
restated in its entirety to read as follows:

            (d) NET  WORTH.  At all  times  Net  Worth  shall  be no  less  than
      $82,000,000  increased  on a  cumulative  basis by an amount equal to, (i)
      commencing  with the fiscal  quarter ending March 31, 1999, as of the last
      day of each fiscal quarter,  50% of Net Income for the fiscal quarter then
      ended  (without  deductions  for  losses)  PLUS  (ii) 100% of the Net Cash
      Proceeds from any Equity Transaction subsequent to the Closing Date.

      6. SCHEDULE 6.17.  Schedule 6.17 of the Credit Agreement is hereby amended
to delete therefrom the reference to Elastex,  Inc. and the information relating
to it.

      7. YEAR 2000 COMPLIANCE.  A new Section 7.12 is hereby added to the Credit
Agreement and shall read as follows:

            7.12  YEAR 2000 COMPLIANCE.

            The Credit  Parties will promptly  notify the Agent in the event any
      Credit  Party  discovers  or  determines  that  any  computer  application
      (including those of its suppliers, vendors and customers) that is material
      to its or any of its  Subsidiaries'  business and  operations  will not be
      Year 2000  Compliant,  except to the extent  that such  failure  could not
      reasonably be expected to have a Material Adverse Effect.

      8. SECURITY  AGREEMENT.  The Security  Agreement is hereby  amended in the
following respects:

            (a) Section  5(d) of the Security  Agreement  is hereby  amended and
      restated in its entirety to read as follows:

                  (d) CHANGE IN LOCATION OR NAME. Not, without providing 30 days
            prior written notice to the Agent and without filing such amendments
            to any  previously  filed  financing  statements  as the  Agent  may
            require,  (i) change the location of its chief executive  office and
            chief place of business (as well as its books and records)  from the
            locations set forth on SCHEDULE 4(B)  attached  hereto,  (ii) change
            the  location  of its  Collateral  from the  locations  set forth on
            SCHEDULE  4(A) attached  hereto,  and (iii) change its legal name or
            begin  using a tradename  other than as set forth on  SCHEDULE  4(C)
            attached hereto.

      9. CONDITIONS PRECEDENT. The effectiveness of this Agreement is subject to
the satisfaction of each of the following conditions:

            (a) The Agent  shall have  received  original  counterparts  of this
      Agreement  duly executed by the Borrower,  the Guarantors and the Required
      Lenders;

<PAGE>

            (b) The Agent shall have received an opinion from the counsel to the
      Credit Parties as to authority,  enforceability  and such other matters as
      may be required by the Agent; and

            (c) Payment by the  Borrower to each of the Lenders of an  amendment
      fee in an  amount  equal  to  0.25% of the  Revolving  Commitment  of such
      Lender.

            10.   MISCELLANEOUS.

            (a) The  term  "Credit  Agreement"  as  used  in each of the  Credit
      Documents  shall  hereafter  mean the Credit  Agreement as amended by this
      Agreement. Except as herein specifically agreed, the Credit Agreement, and
      the  obligations  of the  Credit  Parties  thereunder  and under the other
      Credit  Documents,  are hereby  ratified and confirmed and shall remain in
      full force and effect according to their terms.

            (b) The Borrower and the Guarantors, as applicable, affirm the liens
      and security interests created and granted in the Credit Agreement and the
      Credit  Documents  and  agree  that  this  Agreement  shall  in no  manner
      adversely affect or impair such liens and security interests.

            (c) The Borrower and the Guarantors  hereby represent and warrant as
      follows:

                  (i) Each  Credit  Party  has  taken  all  necessary  action to
      authorize the execution, delivery and performance of this Agreement.

                  (ii) This  Agreement  has been duly  executed and delivered by
      the Credit  Parties and  constitutes  each of the Credit  Parties'  legal,
      valid and binding  obligations,  enforceable in accordance with its terms,
      except  as  such   enforceability   may  be  subject  to  (i)  bankruptcy,
      insolvency, reorganization,  fraudulent conveyance or transfer, moratorium
      or similar laws  affecting  creditors'  rights  generally and (ii) general
      principles  of  equity  (regardless  of  whether  such  enforceability  is
      considered in a proceeding at law or in equity).

                  (iii) No  consent,  approval,  authorization  or order  of, or
      filing,  registration  or  qualification  with, any court or  governmental
      authority  or third party is required in  connection  with the  execution,
      delivery or performance by any Credit Party of this Agreement.

            (d) The Credit Parties represent and warrant to the Lenders that (i)
      the  representations  and  warranties  of the Credit  Parties set forth in
      Section 6 of the Credit  Agreement  and in each other Credit  Document are
      true and  correct as of the date hereof with the same effect as if made on
      and as of the date hereof,  except to the extent such  representations and
      warranties expressly relate solely to an earlier date and (ii) no unwaived
      event has occurred and is  continuing  which  constitutes  a Default or an
      Event of Default.

<PAGE>

            (e) The Guarantors (i)  acknowledge  and consent to all of the terms
      and  conditions of this  Agreement,  (ii) affirm all of their  obligations
      under the Credit  Documents  and (iii) agree that this  Agreement  and all
      documents  executed  in  connection  herewith  do not operate to reduce or
      discharge the Guarantors'  obligations  under the Credit  Agreement or the
      other Credit Documents.

            (f) This  Agreement  may be executed in any number of  counterparts,
      each of which when so executed and delivered shall be an original, but all
      of which  shall  constitute  one and the same  instrument.  Delivery of an
      executed  counterpart  of this Agreement by telecopy shall be effective as
      an  original  and  shall  constitute  a  representation  that an  executed
      original shall be delivered.

            (g) THIS  AGREEMENT  AND THE RIGHTS AND  OBLIGATIONS  OF THE PARTIES
      HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE
      WITH THE LAWS OF THE STATE OF NORTH CAROLINA.

                 [remainder of page intentionally left blank]



<PAGE>

      Each of the parties  hereto has caused a counterpart  of this Agreement to
be duly executed and delivered as of the date first above written.


                                    WORLDTEX, INC., a Delaware corporation


                                    By: ________________________________
                                    Name: ______________________________
                                    Title: _____________________________


                                    REGAL MANUFACTURING COMPANY, INC., a
                                    Delaware corporation


                                    By: ________________________________
                                    Name: ______________________________
                                    Title: _____________________________


                                    ELASTIC CORPORATION OF AMERICA, INC., a
                                    Delaware corporation


                                    By: ________________________________
                                    Name: ______________________________
                                    Title: _____________________________


                                    WTX COLOMBIA II, INC., a Delaware
                                    corporation


                                    By: ________________________________
                                    Name: ______________________________
                                    Title: _____________________________


                                    WTX COLOMBIA I, INC., a Delaware
                                    corporation


                                    By: ________________________________
                                    Name: ______________________________
                                    Title: _____________________________

                            [SIGNATURES CONTINUE]

<PAGE>

                                    WILLCOX & GIBBS FILIX OF DELAWARE, INC.,
                                    a Delaware corporation


                                    By: ________________________________
                                    Name: ______________________________
                                    Title: _____________________________


                                    REGAL YARNS OF ARGENTINA, INC., a North
                                    Carolina corporation


                                    By: ________________________________
                                    Name: ______________________________
                                    Title: _____________________________


                                    NATIONSBANK, N.A., individually in its
                                    capacity as a Lender and in its capacity
                                    as the Agent


                                    By: ________________________________
                                    Name: ______________________________
                                    Title: _____________________________


                                    BANK OF AMERICA NATIONAL TRUST AND
                                    SAVINGS ASSOCIATION


                                    By: ________________________________
                                    Name: ______________________________
                                    Title: _____________________________


                                    BANQUE NATIONALE DE PARIS


                                    By: ________________________________
                                    Name: ______________________________
                                    Title: _____________________________