Prepared by and Return To:
Geoffrey G. Young
Witt, Gaither & Whitaker, P.C.
1100 American National Bank Building
Chattanooga, Tennessee 37402

   FIRST AMENDMENT TO TENNESSEE DEED OF TRUST AND
                          SECURITY AGREEMENT
                          
STATE OF TENNESSEE
COUNTY OF HAMILTON

THIS FIRST AMENDMENT TO TENNESSEE DEED OF TRUST AND
SECURITY AGREEMENT  (hereinafter referred to  as  this
"Amendment"), made  this  the  10th  day of August, 1995,
between  SIGNAL APPAREL  COMPANY, INC., an Indiana
corporation, as  Grantor, and  WALSH  GREENWOOD & CO., as
Grantee,  whose  address  is One East Putnam Avenue,
Greenwich, Connecticut 06830.

                        WITNESSETH:
      THIS IS AN AMENDMENT TO A TENNESSEE DEED OF TRUST
AND SECURITY  AGREEMENT  RECORDED AT  DEED  OF  TRUST
BOOK  182 BEGINNING AT PAGE 434.
      AS  A  RESULT OF THIS AMENDMENT, THE MAXIMUM
PRINCIPAL INDEBTEDNESS  FOR  TENNESSEE  RECORDING  TAX
PURPOSES   IS $20,000,000.00.
     WHEREAS, the parties entered a Credit Agreement,
dated as of March 31, 1995, pursuant to which Grantee
agreed to loan to Grantor a maximum principal amount of
$15,000,000 (the "Credit Agreement"), which borrowing was
evidenced by a Term Promissory Note in the face amount of
$15,000,000 (the "Note"); and
     WHEREAS, all obligations of Grantor under the Credit
Agreement and the Note were secured by a Tennessee Deed of
Trust and Security Agreement recorded in Deed of Trust
Book 182 beginning at Page 434 in the Office of the
Register of Deeds of Claiborne County, Tennessee (the
"Deed of Trust"); and
     WHEREAS, the parties have executed a First Amendment
to Credit Agreement, dated as of August 10, 1995 (the
"Amendment"), by which, among other things, the Credit
Agreement was amended to increase the maximum borrowing
amount to $20,000,000 and pursuant to which Grantor has
executed and delivered to Grantee a Replacement Promissory
Note in the face amount of $20,000,000 (the "Replacement
Note") which replaces the Note; and
     WHEREAS, the parties desire to amend the Deed of
Trust to reflect the terms of the Amendment and the
additional borrowing under the Replacement Note.
      NOW, THEREFORE, for and in consideration of the
foregoing, the parties agree as follows:

     1.   The Credit Agreement shall be amended in
accordance with the terms of the Amendment.

     2.   The Deed of Trust shall be amended to reflect
the terms of the Amendment, including the increase of the
maximum principal amount of authorized borrowing to
$20,000,000.

     3.   All references in the Deed of Trust to the
Credit Agreement shall mean the Credit Agreement as
amended by the Amendment.
     4.   All references in the Deed of Trust to
Indebtedness shall mean indebtedness under the Credit
Agreement as amended by the Amendment.
   5.   All references to a maximum principal amount of
borrowing of $15,000,000 shall be amended to reference a
maximum principal amount of borrowing of $20,000,000.

    6.   All other provisions of the Deed of Trust not
amended hereby shall remain in full force and effect.

     IN  WITNESS WHEREOF, Grantor has executed this Deed
of Trust under seal the day and year first above written.

SIGNAL APPAREL COMPANY, INC.,


By:/s/William H. Watts
   --------------------
Title: CFO
      -----------------

STATE OF TENNESSEE]
COUNTY OF HAMILTON]

Personally appeared before me, a Notary Public in and for
the County aforesaid, William Watts, with whom
I am personally acquainted (or proved to me on the basis
of satisfactory evidence), and who upon oath acknowledged
such person to be the Chief Financial Officer of Signal
Apparel Company, Inc., the within named Grantee, a
corporation, and that he executed the within instrument
for the purposes therein contained by personally signing
on behalf of such corporation as such officer.

Witness my hand, at office, this the 10th day of August,
1995.

/s/Pamela B. Clingan
----------------------
Notary Public
My Commission Expires: 5/18/99
                      -------------


                       AFFIDAVIT OF VALUE


STATE OF TENNESSEE}
COUNTY OF HAMILTON}

DEBTOR: SIGNAL APPAREL COMPANY, INC.

SECURED PARTY: WALSH GREENWOOD & CO.

      Personally appeared before me, a Notary Public in  and
for the  County  aforesaid, William Watts, with whom I am
personally acquainted  (or  proved  to  me  on  the  basis  of
satisfactory evidence), and who upon oath acknowledged himself
to be the Chief Financial  Officer of Signal Apparel Company,
Inc., and  who  did depose and state as follows:

      1.  Debtor owns real property located in Claiborne
County, Tennessee subject to the encumbrances, security
interest or  lien evidenced  by a Deed of Trust recorded at
Book 182,  Page 434, Register's Office of Claiborne County
and by the instrument being filed  herewith.  This  instrument
amends the  previous  Deed  of Trust, for which the transfer
tax has been paid.

       2.   THE  MAXIMUM  PRINCIPAL  INDEBTEDNESS  FOR
TENNESSEE RECORDING  TAX  PURPOSES  is  $20,000,000.  The
value of the collateral everywhere is $37,341,000.

       3. If further advances are made or if contingent
liabilities mature which result in the maximum principal
indebtedness secured by  said  property exceeding the amount set
forth in Paragraph  2 above,  then  an amended filing shall be
made and the  additional tax  shall  be  paid.  The priority of
the encumbrance,  security interest or lien covering all advances
and contingent liabilities shall,  in any event, be no later
than the time of filing of  the instruments referred to in
Paragraph 1 above.

       4.  The amount of indebtedness stated above is made in
good faith  and  for  the  sole purpose of determining
privilege  tax liability under TCA  67-4-409. it is to be
understood clearly  by any  persons to discover this Affidavit
among the public  records of  the State of Tennessee or of any
County thereof, or otherwise discover  this Affidavit, that
this statement is solely  for  the determination of any such
tax. Third parties are instructed  that they  are  not  to
rely  upon  this Affidavit  for  any  purpose whatsoever.

       5.  The  security agreement or other document or
documents evidencing the security interest granted Secured
Party by  Debtor secures  future advances and other and
contingent liabilities  of every  kind  and  character. The
amount  of  indebtedness  stated herein  shall  in  no  way be
construed to limit  the  amount  of indebtedness  secured  by
such  agreements  and  should  not  be considered  by  any
third party to be a  representation  of  the actual
indebtedness currently or from time to time owed by Debtor to
Secured Party.

      6.   The transfer tax on the previous Deed of Trust in
the maximum  principal amount of $15,000,000.00 has been paid
(amount already  paid:  $6,897.70).  New advances  under  this
amendment increase  the  maximum principal indebtedness to
$20,000,000.00, leaving a difference of $5,000,000.00.

       7.   The  total  amount  of  Tennessee  recording  tax
is calculated as follows:

     $14,937,500 (value of collateral in Tennessee)  = 40%
     -----------------------------------------------
     $37,341,000 (value of total collateral)

     $5,000,000 (new principal indebtedness) x 40% = $2,000,000

     Portion of indebtedness on which tax is payable =$2,000,000

     Computation of tax:
          $2,000,000 X $.115 per $100 = $2,300.00

     Balance due: $2,300.00

     This the 10th day of August, 1995




/s/William H. Watts
-------------------------
William Watts

      Witness  my hand, at office, this the 10th day  of
August, 1995.


/s/Pamela B. Clingan
------------------
Notary Public
My Commission Expires: 5/18/99
                       --------

STATE OF TENNESSEE, CLAIBORNE COUNTY
THE FOREGOING INSTRUMENT AND CERTIFICATE WERE NOTED.
NOTE BOOK 16 PAGE 28 AT 11:30 O'CLOCK AM
MONDAY 11 MONTH SEPT 1995 AND RECORDED IN
TD BOOK 185 SERIES PAGE 626 - 629
TAX PAID 2,300 FEE 5.25 RECORDING 17.00
TOTAL $2322.25 WITNESS MY HAND RECEIPT NO 54022
REGISTER 25 /S/KIM REESE