INTERCREDITOR AGREEMENT

          THIS INTERCREDITOR  AGREEMENT (this "Agreement") is entered into as of
     _____________,  1998, between Foothill Capital  Corporation (the "Revolving
     Credit  Lender"),  IBJ Schroder  Bank and Trust  Company  (the  "Collateral
     Agent" and the "Note  Agent"),  as agent under the Note Purchase  Agreement
     dated as of  _____________,  1998,  for the  Purchasers  of the 12%  Senior
     Secured  Notes  (the  "Notes")  of  Oneita  Industries,  Inc.,  a  Delaware
     corporation (the "Debtor"),  and as Collateral Agent under the Security and
     Pledge Agreement and the Subsidiary Guaranty and Security  Agreement,  each
     dated as of  _____________,  1998,  and the  undersigned  Purchasers of the
     Notes, with reference to the following recitals of fact:

          A. The Revolving  Credit Lender  provides  financing to the Debtor and
     its Subsidiary,  Oneita-Kinston Corp.  ("Oneita-Kinston"),  pursuant to the
     Revolving  Credit  Documents.  The  Revolving  Credit Claims are secured by
     security interests in the Collateral.

          B. For good and valuable  consideration  the  Purchasers  acquired the
     Notes pursuant to the Note Financing Documents. The Note Claims are secured
     by security interests in the Collateral.

          C. The Revolving Credit Lender,  the Agent, and the Purchasers wish to
     enter into this Agreement to establish the respective rights and priorities
     of the Revolving Credit Lender, the Agent, and the Purchasers in and to the
     Collateral.

          NOW, THEREFORE,  for good and valuable consideration,  the receipt and
     adequacy of which hereby are acknowledged by each party hereto, the parties
     hereto hereby agree that:

     1.  Definitions.  Terms used  herein  that are  defined in the UCC have the
     meanings  defined  for those  terms in the UCC unless  otherwise  expressly
     defined herein. As used herein, the following terms shall have the meanings
     respectively set forth after each:

                    "Agent"  shall mean (a) the Note  Agent with  respect to any
               provision  hereof  that  pertains  to the  Note  Claims,  (b) the
               Collateral  Agent  with  respect  to any  provision  hereof  that
               pertains to the  Collateral,  and (c) both the Note Agent and the
               Collateral  Agent  with  respect  to any  provision  hereof  that
               pertains  both to the Note Claims and the  Collateral,  or if the
               context so requires.
<PAGE>
                    "Claims"  means the  Revolving  Credit  Claims  and the Note
               Claims.

                    "Collateral"  means all tangible and intangible  real and/or
               personal  property of the Debtor and any of its  Subsidiaries  in
               which  any  Creditor  or  Agent  has a  Lien,  including  without
               limitation  their   respective   accounts,   inventory,   general
               intangibles,   documents,  chattel  paper,  instruments,   money,
               deposit accounts,  securities,  investment  property,  machinery,
               equipment, furnishings,  fixtures, real property and improvements
               thereon, now owned or hereafter acquired,  wherever located,, and
               all  products  and  proceeds  of any  thereof,  as such terms are
               defined in the UCC, as applicable.

                    "Collateral  Agent" has the meaning  ascribed thereto in the
               introductory paragraph hereof.

                    "Creditors" means, collectively, the Revolving Credit Lender
               and its successors and assigns,  if any, and the Purchasers,  and
               their successors and assigns, if any.

                    "Creditor  Group" means either,  but not both, the Revolving
               Credit Lender or the Purchasers.

                    "Creditor  Group  Claim"  shall mean  either  the  Revolving
               Credit Claims or the Note Claims, as the context may require.

                    "Enforcement  Action" means,  with respect to any Collateral
               and  any  Creditor  Group:  collecting,   repossessing,  selling,
               leasing  or  otherwise  disposing  of  all or any  part  of  such
               Collateral,  or exercising notification or collection rights with
               respect to all or any portion thereof,  or attempting or agreeing
               to do  so;  commencing  the  enforcement  with  respect  to  such
               Collateral  of any of the default  remedies  under any  Financing
               Documents,  the UCC or other applicable  laws; or  appropriating,
               setting  off, or applying any part or all of such  Collateral  in
               the  possession  of,  or  coming  into the  possession  of,  such
               Creditor  Group or its agent or bailee,  to such  Creditor  Group
               Claim.

                    "Enforcement  Period"  means,  with respect to the Claims of
               either  Creditor  Group,  any period of time  commencing upon the
               occurrence of any default with respect to such Claim that permits
               such  Creditor   Group  or  its  agent  or  bailee  to  take  any
               Enforcement  Action,  and continuing until the earlier of (a) the
               satisfaction  in full of such  Creditor  Group  Claims or (b) the
               Creditor   Group's   agreement  in  writing  to  terminate   such
               Enforcement Period.
<PAGE>
                    "Financing  Documents"  means the Revolving Credit Financing
               Documents and the Note Financing Documents.

                    "Lien"  means  any  mortgage,   pledge,  security  interest,
               encumbrance,  lien,  charge  or  deposit  arrangement,  or  other
               arrangement having the practical effect of the foregoing.

                    "Note  Agent"  has  the  meaning  ascribed  thereto  in  the
               introductory paragraph hereof.

                    "Note  Claims"  means all present  and future  claims of the
               Purchasers  under or  related  to the Note  Financing  Documents,
               against the Debtor or its  Subsidiaries for the payment of money,
               including  all  claims  for  principal  and  interest  (including
               interest   accruing  after  the   commencement  of  a  bankruptcy
               proceeding by or against the Debtor or its Subsidiaries,  whether
               or not such interest is an allowed claim),  or for  reimbursement
               of fees,  costs  or  expenses,  or  otherwise,  whether  fixed or
               contingent, matured or unmatured, liquidated or unliquidated, and
               whether sounding in contract, in tort or otherwise, and including
               all fees and expenses of the Agent in any capacity  (including as
               Registrar,   Transfer  Agent,   Paying  Agent,  Note  Agent,  and
               Collateral Agent).

                    "Note  Collateral"  means  all  Collateral  other  than  the
               Revolving Credit Collateral.

                    "Note   Financing   Documents"   means  the  Note   Purchase
               Agreement,  the Note Security Agreement,  and all notes, security
               documents or other  documents or agreements in any way evidencing
               or relating to the Note Claims, as the same may from time to time
               be amended, modified, renewed, extended or restated.

                    "Note Purchase  Agreement"  means that certain Note Purchase
               Agreement, dated as of _____________, 1998, among the Debtor, the
               Purchasers, and the Note Agent, as agent for the Purchasers.

                    "Note Security Agreement" means the "Security  Documents" as
               such term is defined in the Note Purchase Agreement.

                    "proceeds" has the meaning  ascribed to such term in Article
               9 of the UCC.

                    "Purchasers"  means  the  institutions  party  to  the  Note
               Purchase  Agreement in that capacity,  and who are signatories to
               this Agreement, and their respective successors and assigns.
<PAGE>
                    "Revolving Credit Claims" mean all present and future claims
               of the Revolving  Credit Lender under or related to the Revolving
               Credit   Financing   Documents,   against   the   Debtor  or  its
               Subsidiaries  for the payment of money,  including all claims for
               principal and interest  (including  interest  accruing  after the
               commencement of a bankruptcy  proceeding by or against the Debtor
               or its  Subsidiaries,  whether or not such interest is an allowed
               claim),  or for  reimbursement  in  connection  with amounts paid
               under letters of credit,  or for  reimbursement of fees, costs or
               expenses, or otherwise,  whether fixed or contingent,  matured or
               unmatured,  liquidated or  unliquidated,  and whether sounding in
               contract, in tort or otherwise.

                    "Revolving Credit Collateral" means all accounts, inventory,
               and deposit  accounts  of the Debtor and any of its  Subsidiaries
               that have granted a Lien in such  Collateral to Revolving  Credit
               Lender,  any and all  instruments  taken in  connection  with any
               accounts,  all  books  and  records  of the  Debtor  and any such
               Subsidiary  to the extent that such books and  records  relate to
               any of the  foregoing,  and any and  all  proceeds  of any of the
               foregoing,  including  proceeds  of  proceeds.  As  used  in this
               definition,    "accounts,"   "inventory,"   "deposit   accounts,"
               "instruments,"  and "proceeds" have the meanings ascribed thereto
               in Article 9 of the UCC.

                    "Revolving  Credit  Agreement"  means that  certain Loan and
               Security  Agreement dated as of ____________,  1998,  between the
               Revolving Credit Lender, the Debtor, and Oneita-Kinston.

                    "Revolving  Credit  Financing  Documents" mean the Revolving
               Credit Agreement, the other "Loan Documents" referred to therein,
               and all other notes, reimbursement agreements, security documents
               or  other  documents  or  agreements  in any  way  evidencing  or
               documenting  the Revolving  Credit  Claims,  as the same may from
               time to time be amended, modified, renewed, extended or restated.

                    "Revolving    Credit   Lender"   means   Foothill    Capital
               Corporation, a California corporation.

                    "Subsidiary"  of a person  or  entity  means a  corporation,
               partnership,  limited liability company, or other entity in which
               that person or entity directly or indirectly owns or controls the
               shares of stock having  ordinary voting power to elect a majority
               of the board of directors (or appoint other comparable  managers)
               of such corporation,  partnership,  limited liability company, or
               other entity.
<PAGE>
                    "UCC" means the Uniform  Commercial  Code, as in effect from
               time to time in the State of New York.

     2. Security Interest  Priorities.  Notwithstanding  (a) the date, manner or
     order of  attachment  or  perfection  of the security  interests  and Liens
     granted in favor of the Revolving  Credit  Lender,  on the one hand, or the
     Collateral Agent acting on behalf of the Purchasers,  or the Purchasers, on
     the other hand, (b) the  provisions of the UCC or any other  applicable law
     or judicial  decisions,  (c) the  provisions  of any  contract or Financing
     Document in effect between either  Creditor Group, on the one hand, and the
     Debtor or any  Subsidiary  thereof,  on the other,  and (d) whether  either
     Creditor Group or any agent or bailee thereof holds  possession of any part
     or all of the Collateral,  the following,  as between the Revolving  Credit
     Lender,  the Purchasers,  and the Collateral  Agent,  shall be the relative
     priority of the perfected  security interests and Liens of the Creditors in
     the Collateral:

          a. The Revolving  Credit Lender shall have a first  priority  security
          interest  in the  Revolving  Credit  Collateral  to the  extent of the
          Revolving Credit Claims,  and the Collateral Agent, as agent on behalf
          of the  Purchasers,  shall have a second  priority  security  interest
          therein to the extent of the Note Claims.

          b. The Collateral  Agent, as agent on behalf of the Purchasers,  shall
          have a first priority  security interest in the Note Collateral to the
          extent of the Note Claims,  and the Revolving Credit Lender shall have
          a second  priority  security  interest  therein  to the  extent of the
          Revolving Credit Claims.

     For the purposes of the foregoing allocation of priorities,  any claim of a
     right of setoff  shall be treated in all  respects as a security  interest,
     and no claimed  right of setoff shall be asserted to defeat or diminish the
     rights or priorities  provided for herein.  The priorities set forth herein
     are  solely for the  purpose of  establishing  the  relative  rights of the
     Creditor Groups and there are no other persons or entities who are intended
     to be benefitted or otherwise affected in any way by this Agreement.

     3. Distribution of Proceeds of Collateral.  During any Enforcement  Period,
     all proceeds of Collateral  shall be  distributed  in  accordance  with the
     following procedure:

          a. All proceeds of Revolving Credit  Collateral first shall be applied
          to the Revolving Credit Claims.  After the Revolving Credit Claims are
          paid or  otherwise  satisfied  in  full,  any  remaining  proceeds  of
          Revolving  Credit  Collateral  shall be paid by the  Revolving  Credit
          Lender to the  Collateral  Agent for  application  to the Note  Claims
          until they are paid or otherwise satisfied in full.
<PAGE>
          b. All proceeds of Note Collateral  first shall be applied to the Note
          Claims. After the Note Claims are paid or otherwise satisfied in full,
          any  remaining  proceeds  of  Note  Collateral  shall  be  paid by the
          Collateral Agent to the Revolving Credit Lender for application to the
          Revolving Credit Claims until they are paid or otherwise  satisfied in
          full.  The Agent shall have no duty to assume the  application of such
          proceeds by the Revolving  Credit Lender.  The Agent shall be entitled
          to assume that Foothill  Capital  Corporation is the Revolving  Credit
          Lender  until  it  receives  a  written  notice  signed  by  a  person
          purporting to be an authorized officer of Foothill Capital Corporation
          that some other  designated  person or entity is the Revolving  Credit
          Lender.

          c. After all of the Claims  have been  irrevocably  paid or  otherwise
          satisfied  in full,  the balance of proceeds  of  Collateral,  if any,
          shall be paid to the Debtor or the  Subsidiary of the Debtor that owns
          or otherwise has rights in such Collateral,  as the case may be, or as
          otherwise  required by applicable  law. The Agent shall be entitled to
          rely conclusively on a certificate from the Revolving Credit Lender as
          to the amount of any unsatisfied  Revolving  Credit Claims,  and shall
          not be obligated  to  distribute  funds  pursuant to this Section 3(c)
          unless  and  until it has  received  confirmation  from the  Revolving
          Credit  Lender  that all  Revolving  Credit  Claims  have been paid or
          otherwise satisfied in full.

     4. Enforcement Actions. The parties hereto agree that:

          a. The Revolving Credit Lender may, at its option,  but subject to the
          provisions of this Section 4, during any  Enforcement  Period relating
          to the Revolving Credit Claims,  take any Enforcement  Action it deems
          appropriate with respect to the Revolving Credit  Collateral,  without
          any  requirement  that it obtain the prior  consent of the  Collateral
          Agent or any Purchaser.  Nothing  herein excuses the Revolving  Credit
          Lender from giving to the Collateral  Agent any notice  required to be
          given by the Revolving Credit Lender to the Collateral Agent under the
          UCC.

          b. The  Collateral  Agent  may,  at its  option,  but  subject  to the
          provisions of this Section 4, during any  Enforcement  Period relating
          to the Note Claims,  take any Enforcement  Action it deems appropriate
          with respect to the Note  Collateral,  without any requirement that it
          obtain the prior consent of the  Revolving  Credit  Lender;  provided,
          however,  that, prior to the taking of any such Enforcement  Action by
          the Collateral Agent (other than an Enforcement  Action that would not
<PAGE>
          interfere  with the  Revolving  Credit  Lender's  45-day use right and
          license  provided  for  below,  such  as,  without   limitation,   the
          publication or giving of a notice),  the Revolving  Credit Lender,  at
          its option,  shall have the right and license (which right and license
          is  granted by the Debtor and  Oneita-Kinston,  and  acknowledged  and
          consented to by the  Collateral  Agent and the  Purchasers,  who agree
          that the Collateral Agent's security interest in the property affected
          by such right and  license  is subject to the rights of the  Revolving
          Credit  Lender with  respect to such right and  license) to use all or
          part of the equipment,  fixtures,  real property,  trademarks,  and/or
          tradenames  included in the Note Collateral for a reasonable period of
          time not to exceed 45 days after receipt of notice from the Collateral
          Agent of the Collateral  Agent's intention to take Enforcement  Action
          with respect  thereto,  to complete the  production of such portion of
          the inventory as constitutes  "Piece Goods" or  "Work-In-Process"  (as
          such terms are defined in the Revolving Credit  Agreement) at the time
          of the receipt of such notice,  with payment for the reasonable  usage
          value  therefor  to be  made by the  Revolving  Credit  Lender  to the
          Collateral  Agent, for the ratable benefit of the Purchasers,  for the
          use of such  property  and property  rights and for the  corresponding
          standstill  and  postponement  for  such  period  of time  of  certain
          Enforcement  Actions in respect of such items by the Collateral  Agent
          and the  Purchasers as provided for above.  Nothing herein excuses the
          Collateral Agent from giving to the Revolving Credit Lender any notice
          required to be given by the Collateral  Agent to the Revolving  Credit
          Lender under the UCC.

          c.  Notwithstanding  anything to the contrary  herein  contained,  the
          Agent  and the  Purchasers  hereby  agree  and  acknowledge  that  the
          Revolving Credit Lender shall have a first priority  security interest
          in and Lien on the  Revolving  Credit  Collateral  and the  Collateral
          Agent's  or the  Purchasers'  security  interest  in and  Lien  on the
          Revolving  Credit  Collateral  shall be junior and  subordinate to the
          security  interest in and Lien on the Revolving  Credit  Collateral of
          the Revolving Credit Lender,  and the Agent and the Purchasers  hereby
          agree and  acknowledge  that they  shall  hold  back,  standstill  and
          otherwise  refrain  from  taking  any  Enforcement  Action  (including
          notification  to any  account  debtors  of the Lien of the  Collateral
          Agent or any Purchaser on any account,  instruction  to pay any amount
          in respect of any such  account to the Agent or any Person  other than
          the  Revolving  Credit  Lender,  or action to collect any  account) to
          which the  Collateral  Agent or any Purchaser is entitled as a secured
          party under the UCC or otherwise  under  applicable  law in respect of
          the Collateral constituting the Revolving Credit Collateral,  or which
          the  Collateral  Agent or any Purchaser is entitled to take in respect
<PAGE>
          of its interest in the Revolving Credit Collateral upon the occurrence
          and  continuation  of an Event of  Default  under  any Note  Financing
          Document until such time as the Revolving Credit Claims have been paid
          in full;  provided that nothing  herein shall  prevent the  Collateral
          Agent from taking any actions (other than  notification or instruction
          of, or  collection  from,  account  debtors  with respect to accounts)
          necessary or desirable to perfect, maintain,  preserve and protect its
          or  the  Purchasers'   security   interest  in  any  Revolving  Credit
          Collateral so long as the same does not prevent or interfere  with the
          ability of the Revolving  Credit Lender from  realizing the benefit of
          its  prior  and   superior   security   interest  in  the   Collateral
          constituting  the Revolving  Credit  Collateral.  The Revolving Credit
          Lender  shall use its best  efforts  to notify the Agent  pursuant  to
          Section 19 hereof in writing when the  Revolving  Credit  Claims shall
          have been paid in full and the Revolving  Credit Lender has no further
          commitment to extend credit with respect  thereto  (provided  that the
          Revolving  Credit  Lender shall have no  liability  for any failure to
          give such notice unless such failure was intentional or in bad faith),
          and,  during  any  Enforcement  Period,  shall  promptly  remit to the
          Collateral  Agent,  for the  ratable  benefit of the  Purchasers,  any
          surplus proceeds of the Revolving  Credit  Collateral held or received
          by the Revolving  Credit Lender after the Revolving Credit Claims have
          been  paid in full and the  Revolving  Credit  Lender  has no  further
          commitment  to extend  credit  under the  Revolving  Credit  Financing
          Documents.

          d.  Notwithstanding  anything to the contrary  herein  contained,  the
          Revolving  Credit  Lender  hereby  agrees  and  acknowledges  that the
          Collateral Agent shall have a first priority  security interest in and
          Lien on the Note Collateral and the Revolving Credit Lender's security
          interest  in and  Lien on the Note  Collateral  shall  be  junior  and
          subordinate  to  the  security  interest  in  and  Lien  on  the  Note
          Collateral of the Collateral  Agent,  and the Revolving  Credit Lender
          hereby agrees and acknowledges that it shall hold back, standstill and
          otherwise  refrain  from  taking any  Enforcement  Action to which the
          Revolving  Credit  Lender is entitled as a secured party under the UCC
          or  otherwise  under  applicable  law in  respect  of  the  Collateral
          constituting the Note Collateral, or which the Revolving Credit Lender
          is entitled to take in respect of its interest in the Note  Collateral
          upon the occurrence and  continuation of an Event of Default under any
          Revolving Credit Financing Document until such time as the Note Claims
          have been paid in full; provided that nothing herein shall prevent the
          Revolving Credit Lender from taking any actions necessary or desirable
<PAGE>
          to perfect,  maintain,  preserve and protect its security  interest in
          any Note  Collateral so long as the same does not prevent or interfere
          with the ability of the Collateral Agent from realizing the benefit of
          its  prior  and   superior   security   interest  in  the   Collateral
          constituting the Note Collateral,  or from exercising its right to use
          Note  Collateral to the extent  permitted by, and subject to the terms
          of, Section 4b hereof. The Collateral Agent shall use its best efforts
          to notify the Revolving Credit Lender pursuant to Section 19 hereof in
          writing  when the Note Claims  shall have been paid in full  (provided
          that the  Collateral  Agent shall have no liability for any failure to
          give such notice unless such failure was intentional or in bad faith),
          and, during any Enforcement  Period, the Agent and each Purchaser,  as
          applicable,  shall promptly  remit to the Revolving  Credit Lender any
          surplus  proceeds of the Note  Collateral held or received by it after
          the Note Claims have been paid in full.

     5. Waiver of Right to Require  Marshaling.  The Revolving Credit Lender and
     the  Collateral  Agent on behalf of its  respective  Creditor  Group hereby
     expressly  waives any right  that it  otherwise  might have to require  the
     other  Creditor  Group,  or its agent,  to  marshal  assets or to resort to
     Collateral  in any  particular  order or manner,  whether  provided  for by
     common law or statute,  provided  however,  that this  paragraph  shall not
     override any specific  provision of this Agreement.  Neither Creditor Group
     nor its agent shall be required  to enforce  any  guaranty or any  security
     interest given by any person or entity other than the Debtor as a condition
     precedent or concurrent to the taking of any Enforcement Action.

     6.  Exercise of  Remedies.  Subject  only to any express  provision of this
     Agreement  that  requires a Creditor  Group,  or its agent  (including  the
     Collateral Agent), to take or refrain from taking any action, each Creditor
     Group, or its agent acting on its behalf (including the Collateral Agent on
     behalf of the  Purchasers),  may  exercise its good faith  discretion  with
     respect to exercising or refraining  from  exercising any of its rights and
     remedies or taking any  Enforcement  Action.  The Agent and the  Purchasers
     agree that the Revolving Credit Lender shall not incur any liability to the
     Agent or the  Purchasers  for taking or  refraining  from taking any action
     with respect to the  Revolving  Credit  Collateral so long as the Revolving
<PAGE>
     Credit Lender complies with the express  provisions of this  Agreement,  to
     the extent  applicable to it. The Revolving  Credit Lender agrees that none
     of the Agent and the Purchasers  shall incur any liability to the Revolving
     Credit Lender for taking or refraining  from taking any action with respect
     to the Note  Collateral so long as, in the case of any of them, it complies
     with the express provisions of this Agreement,  to the extent applicable to
     it.

     7.  UCC  Notices.  The  provisions  of this  Agreement  shall  satisfy  any
     requirement  that a  subordinated  secured  party  must give  notice to the
     holder  of a senior  security  interest  of its  claim to the  proceeds  of
     realization  of the  collateral  and any  requirement  for furnishing of an
     indemnity bond pursuant to Section  9-504(1)(c)  or any similar  statute is
     hereby waived. In the event that any Creditor Group, or its agent, shall be
     required by the UCC or any other  applicable  law to give any notice to the
     other  Creditor  Group,  or its  agent,  such  notice  shall  be  given  in
     accordance  with  Section  19 hereof  and ten (10)  days'  notice  shall be
     conclusively deemed to be commercially reasonable.

     8. Independent Credit  Investigations.  No Creditor, nor the Agent, nor any
     of their  respective  directors,  officers,  agents or  employees  shall be
     responsible to any other Creditor, the other Creditor Group or the Agent or
     to any other person or entity for the Debtor's solvency,  creditworthiness,
     financial  condition  or  ability  to repay  any of the  Claims  or for the
     accuracy of any recitals, statements,  representations or warranties of the
     Debtor, oral or written, or for the validity,  sufficiency,  enforceability
     or  perfection of the Claims or the  Financing  Documents,  or any security
     interests or Liens granted by the Debtor to any Creditor or Creditor  Group
     in connection  therewith.  The Revolving Credit Lender hereby represents to
     each member of the other Creditor  Group and the Agent,  each Purchaser has
     represented to the Agent and other members of its Creditor  Group,  and the
     Agent hereby represents to the Revolving Credit Lender on its behalf and on
     behalf of the  Purchasers,  that  each such  person  has  entered  into its
     respective financing agreements with the Debtor and any of its Subsidiaries
     based upon its own  independent  investigation,  and makes no  warranty  or
     representation  to the other  Creditors,  the other  Creditor  Group or the
     Agent,  nor  does it  rely  upon  any  representation  of any of the  other
     Creditors,  the other Creditor Group, or the Agent, with respect to matters
     identified  or referred to in this  paragraph.  Subject to the terms of the
     "Agency   Agreement"  (as  such  term  is  defined  in  the  Note  Purchase
     Agreement),  no  Creditor,  Creditor  Group,  nor the Agent  shall have any
     responsibility  to any other Creditor,  Creditor  Group, or the Agent,  for
     monitoring or assuring  compliance by the Debtor or any of its Subsidiaries
<PAGE>
     with any of the Debtor's or such Subsidiary's  covenants or representations
     made to any Creditor.  Without  limiting the  generality of the  foregoing,
     either  Creditor  Group may  perform  in  accordance  with the terms of its
     Financing  Documents  (subject to this Agreement) without regard to whether
     the Debtor's or such Subsidiary's  performance in accordance with the terms
     thereof  might or would  constitute  or result in a breach of  covenants or
     representations  under the other Creditor Group's Financing Documents,  and
     under no circumstances shall any Creditor,  Creditor Group, or the Agent be
     liable to any other  Creditor,  Creditor  Group or the Agent for inducing a
     breach  or  violation  of the  other's  Financing  Documents  by  virtue of
     performing in accordance with the terms of its Financing Documents (subject
     to the terms of this Agreement).

     9.  Non-Avoidability  and Perfection of Liens. The Lien  subordinations and
     relative priorities set forth in this
     Agreement  are  expressly   conditioned  upon  the   non-avoidability   and
     perfection of the security  interest to which another security  interest is
     subordinated.  If the security  interest to which another security interest
     is  subordinated  is not  perfected  or is void or voidable for any reason,
     then the  subordination  provided  for herein shall not be effective to the
     extent of such non-perfection or avoidability.

     10. Perfection of Possessory Security Interests. For the limited purpose of
     perfecting the security interests of any Creditor, the Collateral Agent for
     the benefit of the Purchasers, or any Purchaser, in those types or items of
     Collateral  in which a security  interest may be  perfected by  possession,
     each Creditor Group hereby appoints (subject to the priorities  established
     by Section 2) the Revolving  Credit Lender or the Collateral  Agent, as the
     case may be, as its agent and bailee for the limited  purpose of possessing
     on its behalf any such  Collateral that may come into the possession of the
     other from time to time,  the  Purchasers  agree to instruct the Collateral
     Agent to act, and the  Collateral  Agent agrees so to act, as the Revolving
     Credit Lender's agent and bailee for such limited purpose of perfecting the
     Revolving Credit Lender's security interest by possession  through an agent
     or bailee,  and the Revolving Credit Lender agrees to act as the Collateral
     Agent's  and  Purchasers'  agent and  bailee  for such  limited  purpose of
     perfecting  the  Collateral  Agent's or  Purchasers'  security  interest by
     possession through an agent or bailee, provided that neither Creditor Group
     shall incur any liability to the other  Creditor  Group by virtue of acting
     or having  its  agent act as the  other's  agent or bailee  hereunder,  and
     either  Creditor  Group may  relinquish  possession  of  Collateral  in its
     possession  without  the  consent of the other  Creditor  Group  (except as
     provided in Section 4c and 4d above),  and without  incurring  liability to
     the other Creditor Group,  unless there is an express written  agreement to
     the contrary in effect between the Creditor Groups.
<PAGE>
     11. Amendments,  Modifications and Increases. Each Creditor Group, directly
     or  through  the  Agent  in the  case of the  Purchasers,  may  enter  into
     amendments,   modifications,   renewals  or  extensions  of  its  Financing
     Documents  with the Debtor or any of its  Subsidiaries,  or may increase or
     decrease the credit facilities made available by it to the Debtor or any of
     its  Subsidiaries,  or may  release  or  surrender  any  part or all of its
     Collateral  without in any way affecting the rights and  obligations of the
     other  Creditor  Group or the Agent under this  Agreement or its respective
     Financing Documents.  Should either or both Creditor Groups cease extending
     further credit to the Debtor, this Agreement nevertheless shall continue in
     effect as to the  outstanding  Claims of each  Creditor  Group  until  this
     Agreement is terminated as set forth in Section 12 hereof.

     12. Termination. This Agreement is a continuing agreement, and, unless both
     Creditor Groups, or the Revolving Credit Lender and the Collateral Agent on
     behalf of the  Purchasers,  have  specifically  consented in writing to its
     earlier  termination,  this Agreement shall remain in full force and effect
     in all  respects  until  the  earlier  of (a)  the  date on  which  (i) the
     Revolving  Credit Claims are paid or otherwise  satisfied in full, (ii) the
     Revolving Credit Lender has no further commitment to extend or maintain the
     Revolving  Credit  Financing  Documents  with  the  Debtor  or  any  of its
     Subsidiaries,  (iii) the Revolving Credit Lender has released or terminated
     its security  interest in the  Collateral,  and (iv) the  Revolving  Credit
     Lender shall have delivered to the Collateral Agent any surplus proceeds of
     Revolving Credit Collateral if and to the extent required by Section 4c, as
     provided therein,  or (b) the date on which (x) the Note Claims are paid or
     otherwise  satisfied  in  full,  (y) the  Purchasers,  acting  through  the
     Collateral Agent have released or terminated their security interest in the
     Note  Collateral,  and (z) the Collateral Agent shall have delivered to the
     Revolving  Credit  Lender any surplus Note  Collateral if and to the extent
     required by Section 4d.

     13. Accountings.  Each of the Revolving Credit Lender and the Agent agrees,
     upon the occurrence and during the continuance of any  Enforcement  Action,
     to provide the other, upon reasonable request,  periodic accountings of the
     amount of Claims being  asserted,  and not satisfied,  giving effect to any
     applications of realizations upon Collateral.

     14. Effect of Bankruptcy.  This Agreement  shall be and remain  enforceable
     notwithstanding any bankruptcy or other insolvency proceeding by or against
     the Debtor.

     15. Effect of Dispositions of Collateral on Junior Security Interests.  The
     Revolving  Credit Lender,  the Collateral  Agent,  and the Purchasers agree
     that (a) any collection,  sale or other disposition of the Revolving Credit
<PAGE>
     Collateral by the Revolving  Credit Lender pursuant to the UCC or any other
     applicable  law, shall be free and clear of the junior  security  interest,
     Lien,  claim or offset of the  Collateral  Agent or the  Purchasers in such
     Revolving Credit Collateral (but subject to the Collateral Agent's security
     interest  and  Lien in any  surplus  proceeds);  and (b) any  sale or other
     disposition of the Note Collateral by the Collateral Agent or any Purchaser
     pursuant to any applicable  law, shall be free and clear of the junior Lien
     or security  interest or claim of the Revolving  Credit Lender in such Note
     Collateral (but subject to the Revolving Credit Lender's  security interest
     and Lien in any surplus  proceeds).  To the extent reasonably  requested by
     the Revolving  Credit Lender or the Collateral  Agent,  as the case may be,
     and in accordance with the terms of this Agreement,  the Collateral  Agent,
     the  Purchasers,  and  the  Revolving  Credit  Lender,  respectively,  will
     cooperate in providing any necessary or appropriate  releases,  termination
     and satisfaction of Liens to permit a collection, sale or other disposition
     of the Revolving  Credit  Collateral by the Revolving  Credit Lender and of
     the  Note  Collateral  by the  Collateral  Agent,  free  and  clear  of the
     Collateral  Agent's,  the  Purchasers',  or the Revolving  Credit  Lender's
     junior security interest,  without releasing or affecting any obligation of
     the  Revolving  Credit  Lender under  Section 4c or any  obligation  of the
     Collateral Agent or any Purchaser under Section 4d.

     16.  Construction.  Unless the context of this Agreement  clearly  requires
     otherwise,  references  to the plural  include the  singular,  the singular
     includes  the  plural,  the part  includes  the whole,  "including"  is not
     limiting,  and "or" has the  inclusive  meaning  represented  by the phrase
     "and/or." The words "hereof," "herein," "hereby,"  "hereunder," and similar
     terms in this  Agreement  refer to this Agreement as a whole and not to any
     particular  provision of this  Agreement.  Section  references  are to this
     Agreement unless otherwise specified.

     17.  Modifications  in Writing.  No  amendment,  modification,  supplement,
     termination,  consent,  or waiver of or to any provision of this  Agreement
     nor any consent to any departure  therefrom shall in any event be effective
     unless the same shall be in writing and signed by or on behalf of the party
     against whom enforcement is sought; except that no amendment, modification,
     supplement, termination, consent, or waiver of or to paragraph 2, 3 or 4 of
     this  Agreement  nor any consent to any  departure  therefrom  shall in any
     event be effective unless the same shall be in writing and signed by all of
     the parties hereto.  Any waiver of any provision of this Agreement,  or any
     consent  to any  departure  from  the  terms  of  any  provisions  of  this
     Agreement,  shall be effective  only in the  specific  instance and for the
     specific purpose for which given.
<PAGE>
     18.  Waivers;  Failure or Delay.  No failure or delay on the part of either
     the  Revolving  Credit  Lender or the Agent in the  exercise  of any power,
     right,  remedy,  or privilege under this Agreement shall impair such power,
     right, remedy, or privilege or shall operate as a waiver thereof; nor shall
     any single or partial  exercise  of any such  power,  right,  or  privilege
     preclude  any other or  further  exercise  of any other  power,  right,  or
     privilege.  The waiver of any such right, power,  remedy, or privilege with
     respect to particular facts and  circumstances  shall not be deemed to be a
     waiver with respect to other facts and circumstances.

     19. Notices and Communications.  All notices,  demands,  instructions,  and
     other communications  required or permitted to be given to or made upon any
     party hereto shall be in
     writing  and  shall be  delivered  or sent by  hand,  nationally-recognized
     overnight  courier,  first-class  certified  or  registered  mail,  postage
     prepaid, or telefaxed, and shall be deemed to be given for purposes of this
     Agreement when received,  if delivered by hand, on the second  Business Day
     after sending, if sent by a nationally-recognized overnight courier, on the
     third Business Day after sending, if sent by U.S. mail, postage prepaid, or
     when sent, if sent by confirmed  telefax.  Unless otherwise  specified in a
     notice mailed or delivered in accordance  with the foregoing  provisions of
     this Section,  notices,  demands,  instructions and other communications in
     writing  shall be given to or made upon the  respective  parties  hereto at
     their respective addresses indicated on the signature pages hereof.

     20.  Headings.  Section headings used in this Agreement are for convenience
     of reference only and shall not constitute a part of this Agreement for any
     purpose or affect the construction of this Agreement.

     21. Execution in Counterparts. This Agreement may be executed in any number
     of counterparts and by different parties on separate counterparts,  each of
     which counterparts,  when so executed and delivered,  shall be deemed to be
     an original and all of which counterparts, taken together, shall constitute
     but one and the same Agreement.  This Agreement shall become effective upon
     the execution  and delivery of a counterpart  hereof by each of the parties
     hereto.

     22.  Severability  of Provisions.  Any provision of this Agreement which is
     illegal,  invalid,  prohibited, or unenforceable in any jurisdiction shall,
     as to such  jurisdiction,  be ineffective to the extent of such illegality,
     invalidity,   prohibition,  or  unenforceability  without  invalidating  or
     impairing  the  remaining  provisions  hereof or affecting  the validity or
     enforceability of such provision in any other jurisdiction.
<PAGE>
     23.  Complete  Agreement.  This  Agreement  is intended by the parties as a
     final expression of their agreement in respect of the subject matter hereof
     and is  intended as a complete  statement  of the terms and  conditions  of
     their  agreement.  This Agreement shall not be modified except in a writing
     signed by the party to be  charged,  and may not be  modified  by course of
     conduct or oral agreements.

     24.  Successors  and Assigns.  This Agreement is binding upon and inures to
     the benefit of the successors  and assigns of each party hereto.  The Agent
     and each  Purchaser  agrees to maintain a copy of this  Agreement  together
     with its copies of the  Financing  Documents  relating to the Claims of the
     Purchasers.  The Agent and the Purchasers  expressly reserve their right to
     transfer or assign their Claims,  in whole or in part,  together with their
     rights  hereunder,  provided that,  prior to  transferring or assigning any
     interest  in any such  Claims  to any  person or  entity,  the Agent or the
     transferring or assigning Purchaser shall disclose to such person or entity
     the existence and contents of this Agreement,  shall provide to such person
     or entity a complete and legible copy hereof,  and shall advise such person
     or entity that the  Agent's or such  Purchaser's  security  interest in the
     Collateral  is subject to the terms  hereof.  The  Revolving  Credit Lender
     agrees to maintain a copy of this Agreement together with its copies of the
     Financing  Documents  relating to its Claims.  The Revolving  Credit Lender
     expressly  reserves its right to transfer or assign its Claims, in whole or
     in part,  together  with its  rights  hereunder,  provided  that,  prior to
     transferring  or assigning any interest in any such Claims to any person or
     entity, the Revolving Credit Lender shall disclose to such person or entity
     the existence and contents of this Agreement,  shall provide to such person
     or entity a complete and legible copy hereof,  and shall advise such person
     or entity  that the  Revolving  Credit  Lender's  security  interest in the
     Collateral is subject to the terms hereof.

     25. Release of Collateral.  Each of the parties agrees that, subject to the
     provisions of this Agreement,  either may release or refrain from enforcing
     its security  interest in any Collateral,  or permit the use or consumption
     of such Collateral by Debtor or any of its  Subsidiaries  that pledged such
     Collateral,  free of its security interest, without incurring any liability
     to the other party hereto.

     26. Governing Law;  Jurisdiction;  Venue. This Agreement shall be construed
     in accordance  with and governed by the laws of the State of New York. Each
     party submits to the  non-exclusive  jurisdiction  of the federal and state
     courts  sitting in New York  County,  New York,  and any  appellate  courts
     therefrom, in connection with any matter arising out of or relating to this
     Agreement.  Each party  waives any  objection to venue in any such court in
     New York County,  New York,  in respect of any such matter,  including  any
     objection based on any claim of inconvenience.
<PAGE>
     27. WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY WAIVES,  TO THE FULLEST
     EXTENT  PERMITTED  BY  APPLICABLE  LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
     JURY IN ANY LEGAL  PROCEEDING  DIRECTLY  OR  INDIRECTLY  ARISING  OUT OF OR
     RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
     BASED ON  CONTRACT,  TORT,  OR ANY  OTHER  THEORY).  EACH  PARTY  MAKES THE
     FOREGOING  WAIVER  HAVING HAD THE  BENEFIT OF THE  ADVICE OF  COUNSEL,  AND
     DESIRING TO FOREGO THE COST, DELAY, INEFFICIENCY, AND UNPREDICTABILITY OF A
     JURY TRIAL IN A COMPLEX CIVIL MATTER.  NO PARTY OR ITS  REPRESENTATIVE  HAS
     REPRESENTED THAT IT WOULD NOT SEEK TO ENFORCE THE FOREGOING WAIVER.

              [BALANCE OF PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
     IN WITNESS WHEREOF,  the parties hereto have entered into this Agreement as
     of the date first set forth above, intending to be legally bound hereby.


                              IBJ SCHRODER BANK AND TRUST
                              COMPANY, as the Note Agent and the
                              Collateral Agent acting on behalf
                              of the Purchasers


                              By_________________________________
                              Name:
                              Title:

                              Address:

                              One State Street
                              New York, New York  10004
                              Telefax:    _______________________
                              Attention:  _______________________

                              FOOTHILL CAPITAL CORPORATION, as
                              the Revolving Credit Lender


                              By_________________________________
                              Name:
                              Title:

                              Address:

                              11111 Santa Monica Boulevard
                              Suite 1500
                              Los Angeles, CA 90025-3333
                              Telefax:    _______________________
                              Attention:  _______________________


                              The Purchasers:

                              ALBERT FRIED & CO., L.L.C.


                              By_________________________________
                              Name:
                              Title:

                              Address:

                              40 Exchange Place
                              New York, New York  10005
                              Telefax:    (212) 422-7293
                              Attention:  Mr. Albert Fried, Jr.
<PAGE>
                              FOOTHILL PARTNERS II, L.P. and
                              FOOTHILL PARTNERS III, L.P. and
                              FOOTHILL CAPITAL CORPORATION


                              By_________________________________
                              Name:
                              Title:

                              Address:

                              11111 Santa Monica Boulevard
                              Suite 1500
                              Los Angeles, CA  90025-3333
                              Telefax:    (310) 478-8785
                              Attention:  Ms. Karen Sandler


                              UBS MORTGAGE FINANCING INC.


                              By_________________________________
                              Name:
                              Title:

                              Address:

                              299 Park Avenue
                              New York, New York 10171
                              Telefax:    (212) 821-6299
                              Attention:  Mr. Gregory T. Hradsky


                              LAZARD FRERES & CO., L.L.C.


                              By_________________________________
                              Name:
                              Title:

                              Address:

                              __ Rockefeller Plaza
                              New York, New York  _____
                              Telefax:    _________________
                              Attention:  _________________
<PAGE>
                              THE PRUDENTIAL INSURANCE
                              COMPANY OF AMERICA


                              By_________________________________
                              Name:
                              Title:

                              Address:

                              100 Mulberry Street
                              Newark, New Jersey  07102
                              Telefax:    (201) 802-2333
                              Attention:  Mr. Ric Abel



Consented:

ONEITA INDUSTRIES, INC.,
on behalf of itself and its
Subsidiaries


By
     Name:
     Title:

ONEITA-KINSTON CORP.


By
     Name:
     Title: