Document:

<PAGE>

                                                                   Exhibit 10.68

                       AMENDMENT NO. 7, CONSENT & RELEASE

         THIS AMENDMENT NO. 7, CONSENT & RELEASE (this "Amendment"), dated as of
                                                        ---------
March 30, 2001, is by and among GALEY & LORD, INC., a Delaware corporation (the
"Borrower"), GALEY & LORD INDUSTRIES, INC., a Delaware corporation ("G&L
 --------                                                            ---
Industries"), the other Domestic Subsidiaries of the Borrower (each a
----------
"Guarantor", and together with G&L Industries, the "Guarantors"), the Lenders
 ---------                                          ----------
identified on the signature pages hereto (the "Lenders") and FIRST UNION
                                               -------
NATIONAL BANK, as Agent for the Lenders (the "Agent").
                                              -----

                              W I T N E S S E T H:

         WHEREAS, pursuant to the Credit Agreement dated as of January 29, 1998,
as amended from time to time prior to the date hereof (the "Existing Credit
                                                            ---------------
Agreement") among the Borrower, the Guarantors, the Lenders and the Agent, the
---------
Lenders have extended commitments to make certain credit facilities available to
the Borrower;

         WHEREAS, the Borrower desires to reorganize its ownership of certain of
its Foreign Subsidiaries and certain Existing Joint Ventures (the "Foreign
                                                                   -------
Subsidiary Reorganization") through a series of related non-cash transactions,
-------------------------
including but not limited to the following:

               (a) the Borrower will form two new direct wholly-owned Foreign
         Subsidiaries ("NewLux" and "H29", respectively);
                        ------       ---

               (b) all of the Capital Stock of Galey & Lord International SARL
         ("OldLux") will be transferred directly or indirectly to NewLux;
           ------

               (c) all of the Capital Stock of Swift Textiles Europe Ltd. will
         be transferred directly or indirectly to H29; and

               (d) in connection with the foregoing steps, intercompany notes
         owing to the Borrower will be created.

         WHEREAS, the parties hereto have agreed to amend the Existing Credit
Agreement as set forth herein;

         NOW, THEREFORE, in consideration of the agreements herein contained,
the parties hereby agree as follows:

                                     PART I
                                   DEFINITIONS

<PAGE>

               SUBPART 1.1. Certain Definitions. Unless otherwise defined herein
                            --------------------
         or the context otherwise requires, the following terms used in this
         Amendment No. 7, including its preamble and recitals, have the
         following meanings:

                    "Amended Credit Agreement" means the Existing Credit
                     ------------------------
               Agreement as amended hereby.

                    "Amendment No. 7 Effective Date" is defined in Subpart 3.1.
                     ------------------------------                -----------

               SUBPART 1.2. Other Definitions. Unless otherwise defined herein
                            -----------------
         or the context otherwise requires, terms used in this Amendment,
         including its preamble and recitals, have the meanings provided in the
         Amended Credit Agreement.

                                     PART II
                     AMENDMENTS TO EXISTING CREDIT AGREEMENT

         Effective on (and subject to the occurrence of) the Amendment No. 7
Effective Date, the Existing Credit Agreement is hereby amended in accordance
with this Part II. Except as so amended, the Existing Credit Agreement shall
continue in full force and effect.

               SUBPART 2.1. NOL Impact. The definition of NOL Impact in Section
                            ----------
         1.1 of the Existing Credit Agreement is amended and restated in its
         entirety to read as follows:

                    "NOL Impact" shall mean, for any period prior to the first
                     ----------
               fiscal quarter of fiscal year 2002, the amount of domestic net
               operating loss carry-forwards that arise from the Foreign
               Subsidiary Reorganization (as defined in the Amendment No. 7 and
               Release dated as of March 30, 2001 among the Credit Parties, the
               Required Lenders and the Agent); provided that the aggregate
               amount of NOL Impact shall not exceed $15,400,000.

               SUBPART 2.2. Recovery Events. The definition of Recovery Event in
                            ---------------
         Section 1.1 of the Existing Credit Agreement is amended and restated in
         its entirety to read as follows:

                    "Recovery Event" shall mean the receipt by the Borrower or
                     --------------
               any of its Subsidiaries of any cash insurance proceeds or
               condemnation award payable by reason of theft, loss, physical
               destruction or damage, taking or similar event with respect to
               any of their respective property or assets (other than, solely
               for purposes of Section 2.7(b)(vi), property or assets of a
               Foreign Subsidiary which are subject to a Lien of the type
               described in clause (xi) of the definition of "Permitted Liens").

                                       2

<PAGE>

               SUBPART 2.3. Ownership of Subsidiaries. Section 6.8(b) of the
                            -------------------------
         Existing Credit Agreement is amended and restated in its entirety to
         read as follows:

                    (b) The Borrower will not (i) have any liabilities other
               than (A) the liabilities under the Credit Documents, (B) tax
               liabilities in the ordinary course of business, (C) loans and
               advances permitted under this Agreement and (D) corporate,
               administrative and operating expenses in the ordinary course of
               business and (ii) engage in any business other than (A) owning
               the Capital Stock of its Subsidiaries and activities incidental
               or related thereto and (B) acting as the Borrower hereunder and
               pledging its assets to the Agent, for the benefit of the Lenders,
               pursuant to the Security Documents to which it is a party.

               SUBPART 2.4. Consent. Notwithstanding anything in the Credit
                            -------
         Documents to the contrary, the Required Lenders hereby consent to the
         Foreign Subsidiary Reorganization so long as the Agent shall have
         received all items required by Sections 5.10 and 5.12 of the Credit
         Agreement, including, without limitation, a pledge of all intercompany
         promissory notes payable to any Credit Party; provided, however, that
                                                       --------  -------
         the Borrower shall not be required to deliver a pledge of 65% of the
         Capital Stock of NewLux or H29 until 120 days from the date of
         formation of NewLux or H29, respectively.

               SUBPART 2.5. Release. The Agent and the Required Lenders agree
                            -------
         that in connection with the Foreign Subsidiary Reorganization, they
         will release their Lien on 65% of the Capital Stock of OldLux on the
         later of (i) the date that is 90 days after the Agent receives a pledge
         of 65% of the Capital Stock of NewLux and H29 and (ii) the date that
         OldLux ceases to be a direct Foreign Subsidiary of any Credit Party.
         The Required Lenders authorize the Agent to take such action as
         appropriate in order to effectuate such release, including, without
         limitation, the return of stock certificates.

                                    PART III
                           CONDITIONS TO EFFECTIVENESS

               SUBPART 3.1. Amendment No. 7 Effective Date. This Amendment shall
                            ------------------------------
         be and become effective as of the date hereof (the "Amendment No. 7
                                                             ---------------
         Effective Date") when all of the conditions set forth in this Part III
         --------------                                                --------
         shall have been satisfied, and thereafter this Amendment shall be
         known, and may be referred to, as "Amendment No. 7."
                                            ---------------

               SUBPART 3.2. Execution of Counterparts of Amendment. The Agent
                            --------------------------------------
         shall have received counterparts (or other evidence of execution,
         including

                                       3

<PAGE>

telephonic message, satisfactory to the Agent) of this Amendment, which
collectively shall have been duly executed on behalf of each of the Borrower,
the Guarantors, the Agent and the Required Lenders.

         SUBPART 3.3. Amendment Fee. The Borrower shall pay to the Agent, for
                      -------------
the account of each Lender executing and delivering this Amendment No. 7 to the
Agent on or before noon (Eastern time) on Friday, March 30, 2001, an amendment
fee (the "Amendment Fee") equal to $2,500; provided, however, with respect
          -------------                    --------  -------
Lenders which are funds which invest in bank loans and are advised or managed by
the same investment advisor, only one such Amendment Fee shall be payable to the
investment advisor for such Lenders.

                                     PART IV
                                  MISCELLANEOUS

         SUBPART 4.1. Cross-References. References in this Amendment to any Part
                      ----------------
or Subpart are, unless otherwise specified, to such Part or Subpart of this
Amendment.

         SUBPART 4.2. Instrument Pursuant to Existing Credit Agreement. This
                      ------------------------------------------------
Amendment is a Credit Document executed pursuant to the Existing Credit
Agreement and shall (unless otherwise expressly indicated therein) be construed,
administered and applied in accordance with the terms and provisions of the
Existing Credit Agreement.

         SUBPART 4.3. References in Other Credit Documents. At such time as this
                      ------------------------------------
Amendment No. 7 shall become effective pursuant to the terms of Subpart 3.1, all
          -----                                                 -----------
references in the Existing Credit Agreement to the "Agreement" and all
references in the other Credit Documents to the "Credit Agreement" shall be
deemed to refer to the Existing Credit Agreement as amended by this Amendment.

         SUBPART 4.4. Affirmation of Liens. The Borrower and the Guarantors, as
                      --------------------
applicable, affirm the liens and security interests created and granted in the
Existing Credit Agreement and the Credit Documents and agree that this Amendment
shall in no manner adversely affect or impair such liens and security interests.

         SUBPART 4.5. Representations and Warranties. The Borrower and the
                      ------------------------------
Guarantors hereby represent and warrant as follows:

                                        4

<PAGE>

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

              (ii)  This Amendment 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 Amendment (except as
         required pursuant to the Credit Agreement).

              (iv)  The representations and warranties of the Credit Parties set
         forth in Article III of the Amended Credit Agreement are true and
         correct in all material respects as of the date hereof.

              (v)   No Default or Event of Default exists under the Existing
         Credit Agreement on and as of the date hereof after giving effect to
         the amendments contained herein.

              (vi)  No Credit Party, to the best of its knowledge, has any
         counterclaims, offsets, credits or defenses to the Credit Documents and
         the performance of its obligations thereunder.

         SUBPART 4.6. Acknowledgment. The Guarantors (i) acknowledge and consent
                      --------------
to all of the terms and conditions of this Amendment, (ii) affirm all of their
obligations under the Credit Documents and (iii) agree that this Amendment and
all documents executed in connection herewith do not operate to reduce or
discharge the Guarantors' obligations under the Amended Credit Agreement or the
other Credit Documents.

         SUBPART 4.7. Counterparts. This Amendment may be executed by the
                      ------------
parties hereto in several counterparts, each of which shall be deemed to be an
original and all of which shall constitute together but one and the same
agreement.

         SUBPART 4.8. Governing Law. THIS AMENDMENT SHALL BE DEEMED TO BE A
                      -------------
CONTRACT MADE UNDER AND GOVERNED BY THE

                                        5

<PAGE>

INTERNAL LAWS OF THE STATE OF NORTH CAROLINA WITHOUT GIVING EFFECT TO THE
CONFLICT OF LAW PRINCIPLES THEREOF.

         SUBPART 4.9. Successors and Assigns. This Amendment shall be binding
                      ----------------------
upon and inure to the benefit of the parties hereto and their respective
successors and assigns.
                  [Remainder of page intentionally left blank]

                                        6

<PAGE>

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

BORROWER:                       GALEY & LORD, INC.
--------

                                By:   /s/ Leonard F. Ferro
                                   ---------------------------------------------
                                   Title: Vice President, Secretary & Treasurer

GUARANTORS:                     GALEY & LORD INDUSTRIES, INC.,
----------

                                By:   /s/ Leonard F. Ferro
                                   ---------------------------------------------
                                   Title: Vice President, Secretary & Treasurer

                                G&L SERVICE COMPANY, NORTH
                                AMERICA, INC., a Delaware corporation

                                By:   /s/ Leonard F. Ferro
                                   ---------------------------------------------
                                   Title: Vice President, Secretary & Treasurer

                                SWIFT TEXTILES INC.,
                                a Delaware corporation

                                By:   /s/ Leonard F. Ferro
                                   ---------------------------------------------
                                   Title: Vice President, Secretary & Treasurer

                                SWIFT DENIM SERVICES INC.,
                                a Delaware corporation

                                By:   /s/ Leonard F. Ferro
                                   ---------------------------------------------
                                   Title: Vice President, Secretary & Treasurer

<PAGE>

                                GALEY & LORD PROPERTIES, INC.
                                a Delaware corporation

                                By:   /s/ Nicholas S. Hood
                                   ---------------------------------------------
                                   Title: President

                                SWIFT DENIM PROPERTIES, INC.
                                a Delaware corporation

                                By:   /s/ Nicholas S. Hood
                                   ---------------------------------------------
                                   Title: President

<PAGE>

LENDERS:                        FIRST UNION NATIONAL BANK
-------
                                individually in its capacity as
                                a Lender and in its
                                capacity as Agent

                                By:   /s/ Roger Pelz
                                   ---------------------------------------------
                                   Title: Senior Vice President

                                THE CIT GROUP / COMMERCIAL
                                SERVICES, INC.

                                By:   /s/ William H. Skidmore
                                   ---------------------------------------------
                                   Title: Vice President

                                BANK ONE, NA

                                By:   /s/ Michele L. Quentin
                                   ---------------------------------------------
                                   Title: Assistant Vice President

                                BANK OF AMERICA, N.A.

                                By:   /s/ Deirdre B. Doyle
                                   ---------------------------------------------
                                   Title: Principal

                                SUNTRUST BANK, ATLANTA

                                By:   /s/ David W. Penter
                                   ---------------------------------------------
                                   Title: Director Senior Relationship Manager

                                By:   /s/ Jeff Howard
                                   ---------------------------------------------
                                   Title: Director

<PAGE>

                               WACHOVIA BANK, N.A.

                               By:  /s/ Gary C. Gaskill
                                  ----------------------------------------------
                                    Title: Vice President

                               NATIONAL BANK OF CANADA

                               By:  /s/ Alex M. Council IV
                                  ----------------------------------------------
                                    Title: Vice President

                               By:  /s/ Bill Handley
                                  ----------------------------------------------
                                    Title: Vice President & Manager

                               BANK OF SCOTLAND

                               By:  /s/ Joseph Fratus
                                  ----------------------------------------------
                                    Title: Vice President

                               NORSE CBO, LTD.
                               By:  Regiment Capital Management, LLC
                                     As its Investment Advisor
                               By:  Regiment Capital Advisors, LLC
                                     Its Manager and pursuant to delegated
                                     authority

                               By:  /s/ Timothy Peterson
                                  ----------------------------------------------
                                    Title: President

<PAGE>

                               PRESIDENT & FELLOWS OF HARVARD COLLEGE
                               By:  Regiment Capital Management, LLC
                                     As its Investment Advisor
                               By:  Regiment Capital Advisors, LLC
                                     Its Manager and pursuant to delegated
                                     authority

                               By:   /s/ Timothy Peterson
                                  ----------------------------------------------
                                     Title: Vice President

                               NATIONAL CITY BANK

                               By:   /s/ Peter W. Richer
                                  ----------------------------------------------
                                     Title: Vice President

                               COOPERATIEVE CENTRALE
                               RAIFFEISEN-BOERENLEENBANK B.A.,
                               "Rabobank Nederland", New York Branch

                               By:   /s/ Timothy J. Moore
                                  ----------------------------------------------
                                     Title: Vice President

                               By:   /s/ W. Jeffrey Vollack
                                  ----------------------------------------------
                                     Title: Senior Credit Officer
                                            Senior Vice President

                               GENERAL ELECTRIC CAPITAL CORPORATION

                               By:   /s/ William S. Richardson
                                  ----------------------------------------------
                                     Title: Duly Authorized Signatory

<PAGE>

                               MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY

                               By:  /s/ Steven J. Katz
                                  ----------------------------------------------
                                    Title: Second Vice President and
                                           Associate General Counsel

                               ML CLO XIX STERLING (CAYMAN) LTD.
                               By Sterling Asset Manager, L.L.C., as its
                               Investment Advisor

                               By:  /s/ Louis Pispecchia
                                  ----------------------------------------------
                                    Title: Executive Vice President

                               KZH CYPRESSTREE-1 LLC

                               By:  /s/ Kimberly Rowe
                                  ----------------------------------------------
                                    Title: Authorized Agent

                               CYPRESSTREE INVESTMENT PARTNERS I LTD.
                               By: CypressTree Investment Manangement
                                   Company, Inc. as Portfolio Manager

                               By:  /s/ Jeffrey W. Heuer
                                  ----------------------------------------------
                                    Title: Principal

<PAGE>

                                 CYPRESSTREE INVESTMENT
                                 PARTNERS II LTD.
                                 By: CypressTree Investment Manangement
                                     Company, Inc. as Portfolio Manager

                                 By:   /s/ Jeffrey W. Heuer
                                    --------------------------------------------
                                        Title: Principal

                                 ARCHIMEDES FUNDING, L.L.C.
                                 By: ING Capital Advisors, Inc.,
                                     as Collateral Manager

                                 By:   /s/ Kurt Wegleitner
                                    --------------------------------------------
                                        Title: Senior Vice President

                                 ARCHIMEDES FUNDING II
                                 By: ING Capital Advisors, Inc.,
                                     as Collateral Manager

                                 By:   /s/ Kurt Wegleitner
                                    --------------------------------------------
                                        Title: Senior Vice President

                                 VAN KAMPEN CLO I, LIMITED
                                 By: Van Kampen
                                     Management, Inc.,
                                     as Collateral Manager

                                 By:   /s/ Darvin D. Pierce
                                    --------------------------------------------
                                        Title: Principal

<PAGE>

                                 VAN KAMPEN CLO II, LTD.
                                 By:  Van Kampen
                                      Management, Inc.,
                                      as Collateral Manager

                                 By:  /s/ Darvin D. Pierce
                                    --------------------------------------------
                                       Title: Principal

                                 VAN KAMPEN
                                 SENIOR INCOME TRUST

                                 By:  /s/ Darvin D. Pierce
                                    --------------------------------------------
                                       Title: Principal

                                 VAN KAMPEN PRIME
                                 RATE INCOME TRUST

                                 By:  /s/ Darvin D. Pierce
                                    --------------------------------------------
                                       Title: Principal

                                 KZH PAMCO LLC

                                 By:  /s/ Kimberly Rowe
                                    --------------------------------------------
                                       Title: Authorized Agent

                                 KZH HIGHLAND-2 LLC

                                 By:  /s/ Kimberly Rowe
                                    --------------------------------------------
                                       Title: Authorized Agent

                                 ELC (CAYMAN) LTD.

                                 By:  /s/ Amos N. Beason
                                    --------------------------------------------
                                       Title: Director

<PAGE>

                                 ELC (CAYMAN) LTD. 2000-1

                                 By:  /s/ Amos N. Beason
                                    --------------------------------------------
                                       Title: Director

                                 ELC (CAYMEN) LTD. CDO SERIES 1999-I

                                 By:  /s/ Amos N. Beason
                                    --------------------------------------------
                                       Title: Director

                                 APEX (IDM) CDO I, LTD.

                                 By:  /s/ Amos N. Beason
                                    --------------------------------------------
                                       Title: Director

                                 PILGRIM AMERICA HIGH INCOME
                                 INVESTMENTS LTD. (AS ASSIGNEE)
                                 By:  Pilgrim Investments, Inc.,
                                         as its Investment Manager

                                 By:  /s/ Michel Prince, CFA
                                    --------------------------------------------
                                       Title: Vice President

                                 PILGRIM PRIME RATE TRUST
                                 By:  Pilgrim Investments, Inc.,
                                         as its investment manager

                                 By:  /s/ Michel Prince, CFA
                                    --------------------------------------------
                                       Title: Vice President

<PAGE>

                               SEQUILS PILGRIM I, LTD.
                               By: Pilgrim Investments, Inc.,
                                     as its investment manager

                               By:   /s/ Michel Prince, CFA
                                  ------------------------------------------
                                     Title: Vice President

                               THE CIT GROUP/EQUIPMENT FINANCING, INC.

                               By:   /s/ Katie J. Saunders
                                  ------------------------------------------
                                     Title: Senior Credit Analyst

                               PARIBAS

                               By:   /s/ Edward V. Canale
                                  ------------------------------------------
                                     Title: Managing Director

                               AVALON CAPITAL LTD
                               By: INVESCO Senior Secured Management, Inc.
                                   As Portfolio Advisor

                               By:   /s/ Gregory Stoeckle
                                  ------------------------------------------
                                     Title: Authorized Signatory

                               AVALON CAPITAL LTD 2
                               By: INVESCO Senior Secured Management, Inc.
                                   As Portfolio Advisor

                               By:   /s/ Gregory Stoeckle
                                  ------------------------------------------
                                     Title: Authorized Signatory

<PAGE>

                                 ARK CLO 2000-1

                                 By:    /s/ Lynn Tilton
                                    -----------------------------------------
                                        Title: Authorized Signatory

                                 IFA, INCORPORATED

                                 By:    /s/ Joseph Fratus
                                    -----------------------------------------
                                        Title: Vice President
                                               Bank of Scotland
                                               As Administrative Agent
                                               For IFA, Inc.

                                 ELF FUNDING TRUST I
                                  By:  Highland Capital Management, L.P.,
                                        as Collateral Manager

                                 By:    /s/ Todd Travers
                                    -----------------------------------------
                                        Title: Senior Portfolio Manager

                                 NORTH AMERICAN SENIOR FLOATING
                                 RATE FUND
                                 By: CypressTree Investment Management
                                     Company, Inc. as Portfolio Manager

                                 By:    /s/ Jeffrey W. Heuer
                                    -----------------------------------------
                                        Title: Principal

<PAGE>

                             CHARTER VIEW PORTFOLIO
                             By: INVESCO Senior Secured Management, Inc.
                                 As Investment Advisor

                             By:    /s/ Gregory Stoeckle
                                -----------------------------------------
                                    Title: Authorized Signatory

                             AIM FLOATING RATE PORTFOLIO
                             By: INVESCO Senior Secured Management, Inc.
                                 As Attorney in fact

                             By:    /s/ Gregory Stoeckle
                                -----------------------------------------
                                    Title: Authorized Signatory

                             PACIFICA PARTNERS I, LP
                             By: Imperial Credit Asset Management
                                 As Investment Advisor

                             By:    /s/ Tom Colwell
                                -----------------------------------------
                                    Title: Vice President<PAGE>

                                                                   Exhibit 10.69

                           AMENDMENT NO. 8 AND CONSENT

         THIS AMENDMENT NO. 8 AND CONSENT (this "Amendment"), dated as of August
                                                 ---------
9, 2001, is by and among GALEY & LORD, INC., a Delaware corporation (the
"Borrower"), GALEY & LORD INDUSTRIES, INC., a Delaware corporation ("G&L
 --------                                                            ---
Industries"), the other Domestic Subsidiaries of the Borrower (each a
----------
"Guarantor", and together with G&L Industries, the "Guarantors"), the Lenders
 ---------                                          ----------
identified on the signature pages hereto (the "Lenders") and FIRST UNION
                                               -------
NATIONAL BANK, as Agent for the Lenders (the "Agent").
                                              -----

                              W I T N E S S E T H:

         WHEREAS, pursuant to the Credit Agreement dated as of January 29, 1998,
as amended from time to time prior to the date hereof (the "Existing Credit
                                                            ---------------
Agreement") among the Borrower, the Guarantors, the Lenders and the Agent, the
---------
Lenders have extended commitments to make certain credit facilities available to
the Borrower;

         WHEREAS, the parties hereto have agreed to amend the Existing Credit
Agreement as set forth herein;

         NOW, THEREFORE, in consideration of the agreements herein contained,
the parties hereby agree as follows:

                                     PART I
                                   DEFINITIONS

                  SUBPART 1.1. Certain Definitions. Unless otherwise
                               -------------------
         defined herein or the context otherwise requires, the following
         terms used in this Amendment No. 8, including its preamble and
         recitals, have the following meanings:

                           "Amended Credit Agreement" means the Existing
                            ------------------------
                  Credit Agreement as amended hereby.

                           "Amendment No. 8 Effective Date" is defined in
                            ------------------------------
                  Subpart 3.1.
                  -----------

                  SUBPART 1.2. Other Definitions. Unless otherwise defined
                               -----------------
         herein or the context otherwise requires, terms used in this
         Amendment, including its preamble and recitals, have the meanings
         provided in the Amended Credit Agreement.

<PAGE>

                                     PART II
                     AMENDMENTS TO EXISTING CREDIT AGREEMENT

         Effective on (and subject to the occurrence of) the Amendment No. 8
Effective Date, the Existing Credit Agreement is hereby amended in accordance
with this Part II. Except as so amended, the Existing Credit Agreement shall
continue in full force and effect.

                  SUBPART 2.1.  Section 1.1.
                                -----------

                  (a) The following definitions appearing in Section 1.1 of
         the Existing Credit Agreement are amended and restated in their
         entireties to read as follows:

                  "Applicable Percentage" shall mean, for any day, the rate
                   ---------------------
         per annum set forth below opposite the applicable Level then in
         effect, it being understood that the Applicable Percentage for (i)
         Revolving Loans which are Alternate Base Rate Loans shall be the
         percentage set forth under the column "Alternate Base Rate Margin
         for Revolving Loans", (ii) Revolving Loans which are LIBOR Rate
         Loans shall be the percentage set forth under the column "LIBOR
         Rate Margin for Revolving Loans and Letter of Credit Fee", (iii)
         the Commitment Fee shall be the percentage set forth under the
         column "Commitment Fee", (iv) Tranche B Term Loans which are
         Alternate Base Rate Loans shall be the percentage set forth under
         the column "Alternate Base Rate Margin for Tranche B Term Loans",
         (v) Tranche B Term Loans which are LIBOR Rate Loans shall be the
         percentage set forth under the column "LIBOR Rate Margin for
         Tranche B Term Loans", (vi) Tranche C Term Loans which are
         Alternate Base Rate Loans shall be the percentage set forth under
         the column "Alternate Base Rate Margin for Tranche C Term Loans",
         (vii) Tranche C Term Loans which are LIBOR Rate Loans shall be the
         percentage set forth under the column "LIBOR Rate Margin for
         Tranche C Term Loans" and (viii) the Letter of Credit Fee shall be
         the percentage set forth under the column "LIBOR Rate Margin for
         Revolving Loans and Letter of Credit Fee":

                                        2

<PAGE>

<TABLE>
<CAPTION>
                                             LIBOR Rate                   Alternate
                            Alternate        Margin for                   Base Rate    LIBOR Rate    Alternate Base    LIBOR Rate
                            Base Rate     Revolving Loans                Margin for    Margin for     Rate Margin     Margin for
            Leverage        Margin for     and Letter of     Commitment   Tranche B     Tranche B    for Tranche C     Tranche C
  Level       Ratio      Revolving Loans     Credit Fee         Fee      Term Loans    Term Loans      Term Loans      Term Loans
---------------------------------------------------------------------------------------------------------------------------------
<S>      <C>             <C>              <C>                <C>         <C>           <C>           <C>             <C>
    I     ** 5.0 to 1.0       2.25%             3.50%           0.50%       2.75%         4.00%           3.00%          4.25%

   II     * 5.0 to 1.0        2.00%             3.25%           0.50%       2.50%         3.75%           2.75%          4.00%
          but **4.5 to
              1.0

   III    * 4.5 to 1.0        1.75%             3.00%           0.50%       2.50%         3.75%           2.75%          4.00%
          but **4.0 to
              1.0

    IV    * 4.0 to 1.0        1.50%             2.75%          0.375%       2.25%         3.50%           2.50%          3.75%
          but **3.5 to
              1.0

    V     * 3.5 to 1.0        1.25%             2.50%          0.375%       2.25%         3.50%           2.50%          3.75%
          but **3.0 to
              1.0

    VI    * 3.0 to 1.0        1.00%             2.25%           0.25%       2.00%         3.25%           2.25%          3.50%
</TABLE>

* denotes less than
** denotes more than or equal to

                  The Applicable Percentage shall, in each case, be determined
         and adjusted quarterly on the date five (5) Business Days after the
         date on which the Agent has received from the Borrower the quarterly
         financial information and certifications required to be delivered to
         the Agent and the Lenders in accordance with the provisions of Sections
         5.1(b) and 5.2(b) (each an "Interest Determination Date"). Such
                                     ---------------------------
         Applicable Percentage shall be effective from such Interest
         Determination Date until the next such Interest Determination Date.
         Effective as of August 9, 2001, the Applicable Percentages shall be
         based on Level I until the first Interest Determination Date occurring
         after December 31, 2002. If the Borrower shall fail to provide the
         quarterly financial information and certifications in accordance with
         the provisions of Sections 5.1(b) and 5.2(b), the Applicable Percentage
         from such Interest Determination Date shall, on the date five (5)
         Business Days after the date by which the Borrower was so required to
         provide such financial information and certifications to the Agent and
         the Lenders, be based on Level I until such time as such information
         and certifications are provided, whereupon the Level shall be
         determined by the then current Leverage Ratio.

                  "Borrowing Base" shall mean, as of any day, an amount equal to
                   --------------
         the sum of (i) 85% of Eligible Receivables (excluding Bill and Hold
         Receivables), (ii) 55% of Eligible Inventory not to exceed 60% of the
         aggregate availability under the Borrowing Base, (iii) 60% of Bill and
         Hold Receivables which are Eligible Receivables and (iv) the Klopman
         Liquidity Adjustment, in each case, as set forth in the most recent
         Borrowing Base Certificate delivered to the Agent and the Lenders in
         accordance with the terms of Section 5.2(d) and subject to reserves
         imposed by the Agent in its sole discretion.

                  "Consolidated Retained Earnings" shall mean total retained
                   ------------------------------
         earnings of the Borrower and its Subsidiaries on a consolidated basis
         (plus (i) any After-Tax Strategic Initiative Addbacks, (ii) any NOL
         Impact, (iii) the addback of

                                        3

<PAGE>

extraordinary charges in an aggregate amount not exceeding $1,500,000 on an
after-tax basis associated with the incurrence of Indebtedness permitted by
Section 6.1(j) and the related write-off of capitalized loan costs incurred in
connection with this Credit Agreement and (iv) losses (on an after-tax basis)
arising out of the Klopman Sale) as determined at a particular date in
accordance with GAAP applied on a consistent basis.

         "Eligible Inventory" shall mean, as of any date of determination and
          ------------------
without duplication, the lower of the aggregate book value (based on a FIFO or a
moving average cost valuation, consistently applied) or fair market value of all
raw materials and finished goods inventory and yarn and weaving in process owned
by the Borrower or any of its wholly-owned Subsidiaries less appropriate
                                                        ----
reserves determined in accordance with GAAP but excluding in any event (i)
inventory which is (a) not subject to a perfected, first priority Lien in favor
of the Agent to secure the Credit Party Obligations, except that, until the
earlier to occur of (1) the first date occurring subsequent to August 9, 2001
that the Klopman Entities incur Indebtedness pursuant to Section 6.1(j) and (2)
the Klopman Sale, up to $25,000,000 of the inventory of the Klopman Entities may
be included as Eligible Inventory regardless of perfection or priority in favor
of the Agent or (b) subject to any other Lien that is not a Permitted Lien
(other than a Permitted Lien which secures Indebtedness permitted by Section
6.1(j)), (ii) inventory which is not in good condition or fails to meet
standards for sale or use imposed by governmental agencies, departments or
divisions having regulatory authority over such goods, (iii) inventory which is
not useable or salable at prices approximating their cost in the ordinary course
of the business (including without duplication the amount of any reserves for
obsolescence, unsalability or decline in value), (iv) subject to clause (i)
above, inventory located outside of the United States, except that pursuant to
clause (i) above, up to $25,000,000 of the inventory of the Klopman Entities,
regardless of the location of such inventory, may be included as Eligible
Inventory, (v) inventory located at a leased location with respect to which the
Agent shall not have received a landlord's waiver satisfactory to the Agent
within 90 days of the Closing Date, (vi) inventory which is leased or on
consignment or held at third-party vendors, suppliers or contractors and (vii)
inventory which fails to meet such other specifications and requirements as may
from time to time be established by the Agent in its reasonable discretion.

         "Eligible Receivables" shall mean, as of any date of determination and
          --------------------
without duplication, the aggregate book value of all accounts receivable,
receivables, and obligations for payment created or arising from the sale of
inventory or the rendering of services in the ordinary course of business
(collectively, the "Receivables"), owned by or owing to the Borrower or any of
                    -----------
its wholly-owned Subsidiaries, net of allowances and reserves for doubtful or
uncollectible accounts and sales adjustments consistent with such Person's

                                        4

<PAGE>

internal policies and in any event in accordance with GAAP, but excluding in any
event (i) any Receivable which is (a) not subject to a perfected, first priority
Lien in favor for the Agent to secure the Credit Party Obligations, except that,
until the earlier to occur of (1) the first date occurring subsequent to August
9, 2001 that the Klopman Entities incur Indebtedness pursuant to Section 6.1(j)
and (2) the Klopman Sale, up to $35,000,000 of the Receivables of the Klopman
Entities may be included as Eligible Receivables regardless of perfection or
priority in favor of the Agent or (b) subject to any other Lien that is not a
Permitted Lien (other than a Permitted Lien which secures Indebtedness permitted
by Section 6.1(j)), (ii) Receivables which are more than 60 days past due or 120
days past invoice date (net of reserves for bad debts in connection with any
such Receivables), (iii) 50% of the book value of any Receivable not otherwise
excluded by clause (ii) above but owing from an account debtor which is the
account debtor on any existing Receivable then excluded by such clause (ii),
unless the exclusion by such clause (ii) is a result of a legitimate dispute by
the account debtor and the applicable Receivable is no more than 90 days past
due, (iv) Receivables evidenced by notes, chattel paper or other instruments,
unless such notes, chattel paper or instruments have been delivered to and are
in the possession of the Agent, (v) Receivables owing by an account debtor which
is not solvent or is subject to any bankruptcy or insolvency proceeding of any
kind, (vi) Receivables owing by an account debtor located outside of the United
States or Canada (unless payment for the goods shipped is secured by an
irrevocable letter of credit in a form and from an institution acceptable to the
Agent), except that pursuant to clause (i) above, up to $35,000,000 of the
Receivables of the Klopman Entities, regardless of the location of the account
debtor, may be included as Eligible Receivables, (vii) Receivables which are
contingent or subject to offset, deduction, counterclaim, dispute or other
defense to payment, in each case to the extent of such offset, deduction,
counterclaim, dispute or other defense, (viii) Receivables for which any direct
or indirect Subsidiary or any Affiliate is the account debtor, (ix) Receivables
representing a sale to the government of the United States of America or any
subdivision thereof unless the Federal Assignment of Claims Act has been
complied with to the satisfaction of the Agent with respect to the granting of a
security interest in such Receivable, with or other similar applicable law and
(x) Receivables which fail to meet such other specifications and requirements as
may from time to time be established by the Agent in its reasonable discretion.

         "Excess Cash Flow" shall mean, with respect to any fiscal year period
          ----------------
of the Borrower and its Subsidiaries on a consolidated basis, an amount equal to
(a) Consolidated EBITDA for such period minus (b) consolidated Capital
                                        -----
Expenditures for such period actually paid in cash minus (c) Consolidated
                                                   -----
Interest Expense for such period minus (d) Federal, state and other income taxes
                                 -----
actually paid in cash by the Borrower and its Subsidiaries on a consolidated
basis during such period minus (e) Consolidated Scheduled Funded Debt Payments
                         -----
made

                                        5

<PAGE>

during such period minus (f) to the extent paid in cash, Strategic Initiative
                   -----
Addbacks during such period.

         "Net Cash Proceeds" shall mean the aggregate cash proceeds received by
          -----------------
the Borrower or any Subsidiary in respect of any Asset Disposition, Equity
Issuance or Debt Issuance, net of (a) direct costs (including, without
limitation, legal, accounting and investment banking fees, and sales
commissions), (b) taxes paid or payable as a result thereof and (c) in the case
of any Asset Disposition, the amount necessary to retire any Indebtedness (other
than the Credit Party Obligations) encumbering the Property sold or owed by the
Person whose Capital Stock or Property was sold; it being understood that "Net
Cash Proceeds" shall include, without limitation, any cash received upon the
sale or other disposition of any non-cash consideration received by the Borrower
or any Subsidiary in any Asset Disposition, Equity Issuance or Debt Issuance.

         "Strategic Initiative Addbacks" shall mean, (a) for any period
          -----------------------------
occurring between September 1, 2000 and September 30, 2001, the writedown of
assets, severance, excess run-out cost, lease expense, equipment removal and
relocation and building carrying cost associated with the Strategic Initiatives
of the type described in clause (a) of the definition thereof in an aggregate
amount (excluding the writedown of assets) not to exceed $24,000,000 and (b) (i)
for any period occurring between July 27, 2001 and September 30, 2002, the
writedown of assets, severance, excess run-out cost, lease expense, equipment
removal and relocation, building carrying cost, and fees and expenses (which
cannot be capitalized into future Consolidated Interest Expense) and (ii) for
any period occurring after June 30, 2001 operating results and run-out costs of
G&L Service Company, North America, Inc., in each case, associated with the
Strategic Initiatives of the type described in clause (b) of the definition
thereof in an aggregate amount (excluding the writedown of assets) not to exceed
$26,000,000. Any reversal of reserves set up for these costs and expenses will
be deducted from the calculation of Strategic Initiative Addbacks.

         "Strategic Initiatives" shall mean (a) the rationalization of (i) denim
          ---------------------
capacity, (ii) yarn capacity, (iii) staffing of the Klopman Entities, in each
case announced by the Borrower on or prior to January 31, 2001, and (b) the
rationalization of (i) staff reductions, (ii) the realignment of Greige Fabric
Manufacturing and (iii) the discontinuation of the operations of G&L Service
Company, North America, Inc., in each case announced by the Borrower on or after
July 27, 2001 and prior to September 30, 2001.

         (b)   The following new definitions are hereby added to Section 1.1 of
the Existing Credit Agreement in the appropriate alphabetical order to read as
follows:

                                        6

<PAGE>

         "Klopman Liquidity Adjustment" shall mean, with respect to any fiscal
          ----------------------------
month of the Borrower ending after the incurrence of Indebtedness by the Klopman
Entities pursuant to Section 6.1(j) and prior to the Klopman Sale, an amount
equal to the product of (a) the sum of (i) 85% of Eligible Receivables
(excluding Bill and Hold Receivables) attributable to the Klopman Entities with
respect to the fiscal month ending immediately prior to the Klopman Sale, plus
                                                                          ----
(ii) 55% of Eligible Inventory attributable to the Klopman Entities with respect
to the fiscal month ending immediately prior to the Klopman Sale (not to exceed
60% of the aggregate availability under the Borrowing Base for such fiscal
month) plus (iii) 60% of Bill and Hold Receivables which are Eligible
       ----
Receivables attributable to the Klopman Entities with respect to the fiscal
month ending immediately prior to the Klopman Sale minus (iv) Klopman
                                                   -----
preferential claims minus (v) the amount of all permanent reductions of the
                    -----
Revolving Committed Amount required to be made as a result of the incurrence of
Indebtedness by the Klopman Entities, times (b) the percentage set forth which
                                      -----
corresponds to the fiscal month of the Borrower set forth below:

         Fiscal Month                                           Percentage
         ------------                                           ----------
         October, 2001 through May, 2002                        100%
         June, July and August, 2002                            75%
         September, October and November, 2002                  50%
         December, 2002,  and January and February, 2003        25%
         Thereafter                                             0%

         "Klopman Sale" shall mean any Asset Disposition, or series of related
          ------------
Asset Dispositions, of all of the Capital Stock of, or all or substantially all
of the assets of, the Klopman Entities.

         SUBPART 2.2. Accounting Terms. The third paragraph in Section 1.3 of
                      ----------------
the Existing Credit Agreement is amended and restated in its entirety to read as
follows:

Notwithstanding the above, the parties hereto acknowledge and agree that, for
purposes of all calculations made in determining compliance for any applicable
period with the financial covenants set forth in Sections 5.9(a), (d), (e) and
(f) hereof (including without limitation for purposes of the definition of
"Applicable Percentage" set forth in Section 1.1) for all calculation periods
ending subsequent to the Klopman Sale, income statement items (whether positive
or negative) attributable to the Klopman Entities shall be excluded in such
calculations to the extent relating to such applicable period. In furtherance of
the foregoing, the portion of Consolidated Interest Expense attributable to the
Klopman Entities shall be calculated by multiplying (i) the sum of the Net Cash
Proceeds from the

                                        7

<PAGE>

Klopman Sale plus the proceeds from the Klopman Sale which are applied to
             ----
repay Funded Debt (other than the Credit Party Obligations) times (ii) the
                                                            -----
average rate of interest paid on the Loans outstanding during the
applicable period (using a weighted average method acceptable to the
Agent). Furthermore, for purposes of calculating Excess Cash Flow for any
applicable period ending after the Klopman Sale, income statement items,
cash flow statement items and balance sheet items attributable to the
Klopman Entities shall be excluded in such calculations to the extent
relating to such applicable period.

         SUBPART 2.3.  Mandatory Reductions. Section 2.6(b) of the Existing
                       --------------------
Credit Agreement is amended and restated in its entirety to read as follows:

                (b) Mandatory Reductions. (i) On any date that the Revolving
                    --------------------
         Loans are required to be prepaid pursuant to the terms of Section
         2.7(b) (ii), (iii), (iv)(A), (v), (vi) or (viii), the Revolving
         Committed Amount shall be automatically permanently reduced by the
         amount of such required prepayment and/or reduction.

                (ii) On any date that the Term Loans are required to be prepaid
         pursuant to the terms of Section 2.7(b)(iv)(B) or (vii), the Revolving
         Committed Amount shall be automatically permanently reduced by an
         amount equal to the product of (1) the ratio of (a) the Revolving
         Committed Amount then in effect to (b) the sum of the then outstanding
         principal amount of the Term Loans (immediately prior to giving effect
         to such prepayment) plus the Revolving Committed Amount then in effect
                             ----
         times (2) one-hundred percent (100%) of the Net Cash Proceeds (or, if
         -----
         greater, one-hundred percent (100%) of the commitment amount, in the
         case of a Debt Issuance) of the Debt Issuance or Asset Disposition
         triggering such prepayment of the Term Loans.

         SUBPART 2.4.  Mandatory Prepayments. Clauses (b)(iii), (b)(vii) and
                       ---------------------
(b)(ix) appearing in Section 2.7 of the Existing Credit Agreement are amended
and restated in their entireties to read as follows:

         (b)    Mandatory Prepayments.
                ---------------------

                                     *******

                (iii) Asset Dispositions. Promptly following any Asset
                      ------------------
         Disposition (other than the Klopman Sale), the Borrower shall prepay
         the Loans in an aggregate amount equal to the Net Cash Proceeds derived
         from such Asset Disposition (such prepayment to be applied as set forth
         in clause (ix) below).

                                     *******

                                        8

<PAGE>

                        (vii) Klopman Sale. Promptly following the Klopman Sale,
                              ------------
                  the Borrower shall reduce the Revolving Committed Amount as
                  described in Section 2.6(b)(ii)and shall prepay the Term Loans
                  in an aggregate amount equal to the product of (1) the ratio
                  of (a) the then outstanding principal amount of the Term Loans
                  (prior to such prepayment) to (b) the sum of the then
                  outstanding principal amount of the Term Loans (prior to such
                  prepayment) plus the Revolving Committed Amount then in effect
                              ----
                  times (2) one-hundred percent (100%) of the Net Cash Proceeds
                  -----
                  of the Klopman Sale to the Lenders (such prepayment to be
                  applied as set forth in clause (ix) below).

                                     *******

                        (ix)  Application of Mandatory Prepayments. All amounts
                              ------------------------------------
                  required to be paid pursuant to this Section 2.7(b) shall be
                  applied as follows: (A) with respect to all amounts prepaid
                  pursuant to Section 2.7(b)(i), to Revolving Loans and (after
                  all Revolving Loans have been repaid) to a cash collateral
                  account in respect of LOC Obligations, (B) with respect to all
                  amounts prepaid pursuant to Sections 2.7(b)(ii), (iii),
                  (iv)(A), (v), (vi) and (viii), (1) first pro rata to the Term
                                                     ----- --- ----
                  Loans (ratably to the remaining principal installments
                  thereof) and (2) second to the Revolving Loans and (after all
                                   ------
                  Revolving Loans have been repaid) to a cash collateral account
                  in respect of LOC Obligations, and (C) with respect to all
                  amounts prepaid pursuant to Sections 2.7(b)(iv)(B) and (vii),
                  pro rata to the Term Loans (ratably to the remaining principal
                  --- ----
                  installments thereof). Within the parameters of the
                  applications set forth above, prepayments shall be applied
                  first to Alternate Base Rate Loans and then to LIBOR Rate
                  Loans in direct order of Interest Period maturities. All
                  prepayments under this Section 2.7(b) shall be subject to
                  Section 2.17 and be accompanied by interest on the principal
                  amount prepaid through the date of prepayment.

                  SUBPART 2.5. Financial Covenants. Sections 5.9(a), (c), (d)
                               -------------------
         and (e) of the Existing Credit Agreement are amended and restated in
         their entireties to read as follows:

Commencing on the day immediately following the Closing Date, the Borrower
shall, and shall cause each of its Subsidiaries to, comply with the following
financial covenants:

                  (a)   Adjusted Leverage Ratio. As of the end of each fiscal
                        -----------------------
         quarter set forth in the table below, there shall be maintained an
         Adjusted Leverage Ratio of not greater than the corresponding ratio
         appearing in such table. The applicable period for purposes of
         determining compliance herewith shall be for the period of four (4)
         fiscal quarters ending on the applicable date set forth below.

                                        9

<PAGE>

               Period                                      Ratio
               ------                                      -----

         December 28, 2002                                 3.5 to 1.0
         March 29, 2003                                    3.5 to 1.0
         June 28, 2003                                     3.25 to 1.0
         September 27, 2003                                3.25 to 1.0
         December 28, 2003 and thereafter                  3.0 to 1.0

                                     *******

         (c)   Capital Expenditures.
               --------------------

         (i)   As of the end of the four fiscal quarter period ending on the
last day of each fiscal quarter set forth in the table below, Capital
Expenditures for such four fiscal quarter period then ended shall not exceed the
corresponding amount appearing in such table:

               Period                                               Amount
               ------                                               ------

               September 29,  2001                                  $26,000,000
               December 29, 2001                                    $26,000,000
               March 30, 2002                                       $20,000,000
               June 29, 2002                                        $18,000,000
               September 28, 2002                                   $18,000,000

         (ii)  Beginning with the fiscal quarter ended December 28, 2002, the
Borrower and its Subsidiaries shall not, as a group, make or incur Capital
Expenditures in any fiscal year in excess of the amount shown below:

               Fiscal year 2003 and
               each fiscal year thereafter                          $25,000,000.

provided, that beginning with the fiscal year ended September 28, 2002, up to
--------
$10,000,000 of any such amount, if not expended in the fiscal year for which it
is permitted above may be carried over for expenditure in the next following
fiscal year.

For purposes of determining compliance with this Section 5.9(c), the Borrower
shall be permitted to exclude the aggregate amount of Investments made pursuant
to clause (iii)(G) of the definition of Permitted Investments from the
calculation of Capital Expenditures for the fiscal year during which such
Investments were made.

                                       10

<PAGE>

         (d)  Adjusted Fixed Charge Coverage Ratio. As of the end of each fiscal
              ------------------------------------
     quarter set forth in the table below, there shall be maintained an Adjusted
     Fixed Charge Coverage Ratio of not less than the corresponding ratio
     appearing in such table. The applicable period for such purposes of
     determining compliance herewith shall be for the period of four (4) fiscal
     quarters then ended.

              Period                                Ratio
              ------                                -----

              December 28, 2002
              and thereafter                        1.1 to 1.0

         Following the Klopman Sale, Consolidated Fixed Charges shall not
     include Capital Expenditures attributable to the Klopman Entities during
     the applicable period for purposes of determining compliance with this
     Section 5.9(d).

         (e)  Minimum Consolidated EBITDA. As of the end of each fiscal quarter
              ---------------------------
     set forth in the table below, there shall be Consolidated EBITDA of not
     less than the corresponding amount appearing in such table.

              Period                Amount*         Amount**
              ------                --------        --------

         September 29, 2001/1/      $13,500,000     $13,500,000
         December 29, 2001/2/       $32,000,000     $29,000,000
         March 30, 2002/3/          $53,000,000     $47,000,000
         June 29, 2002/4/           $76,000,000     $67,000,000
         September 28, 2002/4/      $79,000,000     $68,000,000

         *   Applicable for any fiscal quarter ending prior to the Klopman
             Sale.
         **  Applicable for any fiscal quarter ending subsequent to the
             Klopman Sale.
         /1/ Notwithstanding anything contained in this Credit Agreement to
             the contrary, the applicable period for the purpose of
             determining compliance herewith shall be the fiscal quarter
             then ended.
         /2/ Notwithstanding anything contained in this Credit Agreement to
             the contrary, the applicable period for the purpose of
             determining compliance herewith shall be the two fiscal
             quarters then ended.
         /3/ Notwithstanding anything contained in this Credit Agreement to
             the contrary, the applicable period for the purpose of
             determining compliance herewith shall be the three fiscal
             quarters then ended.
         /4/ Notwithstanding anything contained in this Credit Agreement to
             the contrary, the applicable period for the purpose of
             determining compliance herewith shall be the four fiscal
             quarters then ended.

         SUBPART 2.6.  Indebtedness. Section 6.1(j) of the Existing Credit
                       ------------
     Agreement is amended and restated in its entirety to read as follows:

         (j)  other Indebtedness of Foreign Subsidiaries (excluding any
     intercompany Indebtedness permitted to be incurred hereunder) incurred
     in order to refinance, replace or otherwise restructure a portion of
     the $490,000,000 principal amount of indebtedness which may have
     originally been incurred under this Agreement, which Indebtedness may
     be secured by the assets of such Foreign Subsidiaries located outside
     of the United States provided that (i) in connection
                          -------- ----

                                     11

<PAGE>

         with the incurrence of such Indebtedness, the Revolving Committed
         Amount is reduced pursuant to Section 2.6(b)(ii) and the Terms
         Loans are prepaid pursuant to Section 2.7(b)(iv)(B), (ii) after
         giving pro forma effect to the incurrence of such Indebtedness,
         the reduction of the Revolving Committed Amount and the prepayment
         of the Loans, the Borrower shall have at least $30,000,000 of
         undrawn availability under both the Revolving Committed Amount and
         the Borrowing Base, (iii) the interest rate on such Indebtedness
         does not exceed the 90-day LIBOR Rate plus 3.25%, (iv) such
                                               ----
         Indebtedness does not contain cross-default or cross-acceleration
         provisions with respect to this Credit Agreement and (v) the terms
         and provisions of any such Indebtedness shall be otherwise
         reasonably acceptable to the Agent.

         SUBPART 2.7.   Consents.
                        --------

         (a)  Klopman Sale. Notwithstanding anything to the contrary contained
              ------------
in the Credit Documents, including, without limitation, Section 6.5 thereof, the
Required Lenders hereby consent to the Klopman Sale so long as the sum of the
Net Cash Proceeds from the Klopman Sale plus the proceeds from the Klopman Sale
                                        ----
which are applied to repay Funded Indebtedness (other than the Credit Party
Obligations) is at least $70,000,000.

         (b)  Discontinued Operations. Notwithstanding anything to the contrary
              -----------------------
contained in the Credit Documents, including, without limitation, Section 6.5
thereof, the Required Lenders hereby consent to the discontinuation of
operations and dissolution of Greige Fabric Manufacturing and G&L Service
Company, North America, Inc.

                                    PART III
                           CONDITIONS TO EFFECTIVENESS

              SUBPART 3.1. Amendment No. 8 Effective Date. This Amendment
                           ------------------------------
         shall be and become effective as of the date hereof (the
         "Amendment No. 8 Effective Date") when all of the conditions set
          ------------------------------
         forth in this Part III shall have been satisfied, and thereafter
                       --------
         this Amendment shall be known, and may be referred to, as
         "Amendment No. 8."
          ----------------

              SUBPART 3.2. Execution of Counterparts of Amendment. The
                           --------------------------------------
         Agent shall have received counterparts (or other evidence of
         execution, including telephonic message, satisfactory to the
         Agent) of this Amendment, which collectively shall have been duly
         executed on behalf of each of the Borrower, the Guarantors, the
         Agent and the Required Lenders.

              SUBPART 3.3. Amendment Fee. The Borrower shall pay to the
                           -------------
         Agent, for the account of each Lender executing and delivering
         this Amendment No. 8 to

                                     12

<PAGE>

         the Agent on or before August 9, 2001, an amendment fee (the
         "Amendment Fee") equal to 0.25% of such Lender's Commitment.
          -------------

                                PART IV
                             MISCELLANEOUS

              SUBPART 4.1. Cross-References. References in this Amendment
                           ----------------
         to any Part or Subpart are, unless otherwise specified, to such
         Part or Subpart of this Amendment.

              SUBPART 4.2. Instrument Pursuant to Existing Credit
                           --------------------------------------
         Agreement. This Amendment is a Credit Document executed pursuant
         ---------
         to the Existing Credit Agreement and shall (unless otherwise
         expressly indicated therein) be construed, administered and
         applied in accordance with the terms and provisions of the
         Existing Credit Agreement.

              SUBPART 4.3. References in Other Credit Documents. At such
                           ------------------------------------
         time as this Amendment No. 8 shall become effective pursuant to
         the terms of Subpart 3.1, all references in the Existing Credit
                      -----------
         Agreement to the "Agreement" and all references in the other
         Credit Documents to the "Credit Agreement" shall be deemed to
         refer to the Existing Credit Agreement as amended by this
         Amendment.

              SUBPART 4.4. Affirmation of Liens. The Borrower and the
                           --------------------
         Guarantors, as applicable, affirm the liens and security interests
         created and granted in the Existing Credit Agreement and the
         Credit Documents and agree that this Amendment shall in no manner
         adversely affect or impair such liens and security interests.

              SUBPART 4.5. Representations and Warranties. 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
              Amendment.

                  (ii) This Amendment 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

                                     13

<PAGE>

              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 Amendment (except as required pursuant
              to the Credit Agreement).

                  (iv)  The representations and warranties of the Credit
              Parties set forth in Article III of the Amended Credit
              Agreement are true and correct in all material respects as of
              the date hereof.

                  (v)   No Default or Event of Default exists under the
              Existing Credit Agreement on and as of the date hereof after
              giving effect to the amendments contained herein.

                  (vi)  No Credit Party, to the best of its knowledge, has
              any counterclaims, offsets, credits or defenses to the Credit
              Documents and the performance of its obligations thereunder.

              SUBPART 4.6. Acknowledgment. The Guarantors (i) acknowledge
                           --------------
         and consent to all of the terms and conditions of this Amendment,
         (ii) affirm all of their obligations under the Credit Documents
         and (iii) agree that this Amendment and all documents executed in
         connection herewith do not operate to reduce or discharge the
         Guarantors' obligations under the Amended Credit Agreement or the
         other Credit Documents.

              SUBPART 4.7. Counterparts. This Amendment may be executed by
                           ------------
         the parties hereto in several counterparts, each of which shall be
         deemed to be an original and all of which shall constitute
         together but one and the same agreement.

              SUBPART 4.8. Governing Law. THIS AMENDMENT SHALL BE DEEMED TO
                           -------------
         BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE
         STATE OF NORTH CAROLINA WITHOUT GIVING EFFECT TO THE CONFLICT OF
         LAW PRINCIPLES THEREOF.

              SUBPART 4.9. Successors and Assigns. This Amendment shall be
                           ----------------------
         binding upon and inure to the benefit of the parties hereto and
         their respective successors and assigns.

                                     14

<PAGE>

                  [Remainder of page intentionally left blank]

                                       15

<PAGE>

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

BORROWER:                GALEY & LORD, INC.
--------

                         By:  /s/ Arthur C. Wiener
                            -------------------------------------
                            Title: Chairman, President & CEO

GUARANTORS:              GALEY & LORD INDUSTRIES, INC.,
----------

                         By:  /s/ Arthur C. Wiener
                            -------------------------------------
                            Title: Chairman, President & CEO

                         G&L SERVICE COMPANY, NORTH
                         AMERICA, INC., a Delaware corporation

                         By:  /s/ Arthur C. Wiener
                            -------------------------------------
                            Title: President & CEO

                         SWIFT TEXTILES INC.,
                         a Delaware corporation

                         By:  /s/ Arthur C. Wiener
                            -------------------------------------
                            Title: President & CEO

                         SWIFT DENIM SERVICES INC.,
                         a Delaware corporation

                         By:  /s/ Arthur C. Wiener
                            -------------------------------------
                            Title: President & CEO

<PAGE>

                        GALEY & LORD PROPERTIES, INC.
                        a Delaware corporation

                        By:  /s/ Anthony J. Forman
                           ----------------------------------
                           Title: Vice President & Treasurer

                        SWIFT DENIM PROPERTIES, INC.
                        a Delaware corporation

                        By:  /s/ Anthony J. Forman
                           ----------------------------------
                           Title: Vice President & Treasurer

<PAGE>

LENDERS:                      FIRST UNION NATIONAL BANK
-------                       individually in its capacity as
                              a Lender and in its
                              capacity as Agent

                              By:  /s/ Roger Pelz
                                  --------------------------------------
                                   Title: Senior Vice President

                              THE CIT GROUP/COMMERCIAL
                              SERVICES, INC.

                              By:  /s/ William H. Skidmore
                                  --------------------------------------
                                   Title: Vice President

                              BANK ONE, NA

                              By:  /s/ Michele L. Quentin
                                  --------------------------------------
                                   Title: Assistant Vice President

                              BANK OF AMERICA, N.A.

                              By:  /s/ Deirdre B. Doyle
                                  --------------------------------------
                                   Title: Principal

                              SUNTRUST BANK, ATLANTA

                              By:  /s/ David W. Penter
                                  --------------------------------------
                                   Title: Director Senior Relationship
                                          Manager

                              By:  /s/ Kim Willis
                                  --------------------------------------
                                   Title: Vice President

                              WACHOVIA BANK, N.A.

                              By:  /s/ Gary C. Gaskill
                                  --------------------------------------
                                   Title: Vice President

<PAGE>

                                  CIBC INC.

                                  By:  /s/ Ihor Zaluckj
                                      ---------------------------------
                                       Title: Executive Director

                                  NATIONAL BANK OF CANADA

                                  By:  /s/ Alex M. Council
                                      ---------------------------------
                                       Title: Vice President

                                  By:  /s/ Dan Shaw
                                      ---------------------------------
                                       Title: Vice President

                                  BANK OF SCOTLAND

                                  By:  /s/ Joseph Fratus
                                      ---------------------------------
                                       Title: Vice President

                                  THE BANK OF TOKYO-MITSUBISHI, LTD.

                                  By:  /s/ Charles Greer
                                      ---------------------------------
                                       Title: Authorized Signatory

                                  NATIONAL CITY BANK

                                  By:  /s/ Peter W. Richer
                                      ---------------------------------
                                       Title: Vice President

                                  COOPERATIEVE CENTRALE
                                  RAIFFEISEN-BOERENLEENBANK B.A.,
                                  "Rabobank Nederland", New York Branch

                                  By:  /s/ Timothy J. Moore
                                      ---------------------------------
                                       Title: Vice President

                                  By:  /s/ Ian Reece
                                      ---------------------------------
                                       Title: Managing Director

<PAGE>

                              PAM CAPITAL FUNDING, LP
                              By:   Highland Capital Management, L.P., as
                                    Collateral Manager

                              By:   /s/ Todd Travers
                                   ---------------------------------------------
                                    Title: Senior Portfolio Manager

                              PAMCO CAYMAN LTD.
                              By:   Highland Capital Management, L.P., as
                                    Collateral Manager

                              By:   /s/ Todd Travers
                                   ---------------------------------------------
                                    Title: Senior Portfolio Manager

                              MASSACHUSETTS MUTUAL LIFE
                              INSURANCE COMPANY

                              By:   /s/ Steven J. Katz
                                   ---------------------------------------------
                                    Title: Second Vice President and Associate
                                           General Counsel

                              ML CBO IV (CAYMAN) LTD
                              By:   Highland Capital Management, L.P., as
                                    Collateral Manager

                              By:   /s/ Todd Travers
                                   ---------------------------------------------
                                    Title: Senior Portfolio Manager

                              ML CLO XIX STERLING
                              (CAYMAN) LTD.
                              By:   Sterling Asset Manager, L.L.C., as its
                                    Investment Advisor

                              By:   /s/ Todd Travers
                                   ---------------------------------------------
                                    Title: Senior Portfolio Manager

<PAGE>

                              MT. MITCHELL CAPITAL FUNDING, LLC

                              By:  /s/ Jeff Peskind
                                  ----------------------------------------------
                                   Title: Managing Director

                              KZH CYPRESSTREE-1 LLC

                              By:  /s/ Susan Lee
                                  ----------------------------------------------
                                   Title: Authorized Agent

                              CYPRESSTREE INVESTMENT
                              PARTNERS I LTD.
                              By:  CypressTree Investment Management
                                   Company, Inc. as Portfolio Manager

                              By:  /s/ Jeffrey W. Heuer
                                  ----------------------------------------------
                                   Title: Principal

                              CYPRESSTREE INVESTMENT
                              PARTNERS II LTD.
                              By:  CypressTree Investment Management
                                   Company, Inc. as Portfolio Manager

                              By:  /s/ Jeffrey W. Heuer
                                  ----------------------------------------------
                                   Title: Principal

                              ARCHIMEDES FUNDING, L.L.C.
                              By:  ING Capital Advisors, Inc.,
                                   as Collateral Manager

                              By:  /s/ Kurt Wegleitner
                                  ----------------------------------------------
                                   Title: Senior Vice President

<PAGE>

                              ARCHIMEDES FUNDING II
                              By:  ING Capital Advisors, Inc.,
                                   as Collateral Manager

                              By:  /s/ Kurt Wegleitner
                                  ----------------------------------------------
                                   Title: Senior Vice President

                              VAN KAMPEN CLO I, LIMITED
                              By:  Van Kampen Management, Inc.,
                                   as Collateral Manager

                              By:  /s/ Darvin D. Pierce
                                  ----------------------------------------------
                                   Title: Principal

                              VAN KAMPEN CLO II, LTD.
                              By:  Van Kampen Management, Inc.,
                                   as Collateral Manager

                              By:  /s/ Darvin D. Pierce
                                  ----------------------------------------------
                                   Title: Principal

                              VAN KAMPEN SENIOR INCOME TRUST
                              By:  Van Kampen Investment Advisory Corp.

                              By:  /s/ Darvin D. Pierce
                                  ----------------------------------------------
                                   Title: Principal

                              VAN KAMPEN PRIME RATE INCOME
                               TRUST
                              By:  Van Kampen Investment Advisory Corp.

                              By:  /s/ Darvin D. Pierce
                                  ----------------------------------------------
                                   Title: Principal

                              KZH HIGHLAND-2 LLC

                              By:  /s/ Susan Lee
                                  ----------------------------------------------
                                   Title:  Authorized Agent

<PAGE>

                              ELC (CAYMAN) LTD.

                              By:     /s/ Amos N. Beason
                                     -------------------------------------------
                                      Title: Director

                              ELC (CAYMAN) LTD. 2000-1

                              By:     /s/ Amos N. Beason
                                     -------------------------------------------
                                      Title: Director

                              ELC (CAYMEN) LTD. CDO SERIES 1999-I

                              By:     /s/ Amos N. Beason
                                     -------------------------------------------
                                      Title: Director

                              APEX (IDM) CDO I, LTD.

                              By:     /s/ Amos N. Beason
                                     -------------------------------------------
                                      Title: Director

                              PILGRIM AMERICA HIGH INCOME
                              INVESTMENTS LTD. (AS ASSIGNEE)
                              By:  Pilgrim Investments, Inc.,
                                      as its Investment Manager

                              By:     /s/ Michel Prince
                                     -------------------------------------------
                                      Title: Vice President

                              PILGRIM PRIME RATE TRUST
                              By:  Pilgrim Investments, Inc.,
                                      as its investment manager

                              By:     /s/ Michel Prince
                                     -------------------------------------------
                                      Title: Vice President

<PAGE>

                              SEQUILS PILGRIM I, LTD.
                              By:  Pilgrim Investments, Inc.,
                                      as its investment manager

                              By:     /s/ Michel Prince
                                     -------------------------------------------
                                      Title:   Vice President

                              PARIBAS

                              By:     /s/ Edward V. Canale
                                     -------------------------------------------
                                      Title:   Managing Director

                              NORTHWOODS CAPITAL, LIMITED
                              By:     Angelo, Gordon & Co., L.P. as Collateral
                                      Manager

                              By:     /s/ John W. Fraser
                                     -------------------------------------------
                                      Title:   Managing Director

                              AVALON CAPITAL LTD 2
                              By:     INVESCO Senior Secured
                                      Management, Inc. as Portfolio Manager

                              By:     /s/ Gregory Stoeckle
                                     -------------------------------------------
                                      Title:   Authorized Signatory

                              ARK CLO 2000-1, LIMITED

                              By:     /s/ Lynn Tilton
                                     -------------------------------------------
                                      Title:   Authorized Signatory

                              BoS (USA), INC.
                             (f/k/a IFA Incorporated)
                              By:  Bank of Scotland as Administrative Agent

                              By:     /s/ Joseph Fratus
                                     -------------------------------------------
                                      Title:   Vice President

<PAGE>

                              ELF FUNDING TRUST I
                              By:  Highland Capital Management, L.P.,
                                      as Collateral Manager

                              By:     /s/ Todd Travers
                                     -------------------------------------------
                                       Title:   Senior Portfolio Manager

                              AIM FLOATING RATE FUND
                              By:     INVESCO Senior Secured
                                      Management, Inc. as Attorney in fact

                              By:     /s/ Gregory Stoeckle
                                     -------------------------------------------
                                      Title:   Authorized Signatory

                              PACIFICA PARTNERS I, LP
                              By:     Imperial Credit Asset Management
                                      as its Investment Advisor

                              By:     /s/ Tom Colwell
                                     -------------------------------------------
                                      Title:   Vice President

                              NORTHWOODS CAPITAL II, LTD.
                              By:     Angelo, Gordon & Co., L.P. as Collateral
                                      Manager

                              By:     /s/ John W. Fraser
                                     -------------------------------------------
                                      Title:   Managing Director

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