SPEIZMAN INDUSTRIES INC
SIXTH AMENDMENT AND FORBEARANCE AGREEMENT
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<TYPE>EX-10
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<FILENAME>exhibit10-sixthamd.htm
<DESCRIPTION>SIXTH AMENDMENT AND FORBEARANCE AGREEMENT
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EXHIBIT 10(a)<p align="center">
<b><u>SIXTH AMENDMENT AND FORBEARANCE AGREEMENT</u></b><p style="text-indent: 60">
<b>THIS SIXTH AMENDMENT AND FORBEARANCE AGREEMENT</b> (this "Agreement"), dated and
effective as of the 31st day of March, 2003 (the "Effective Date"), is by and
among <b>SPEIZMAN INDUSTRIES, INC.,</b> a Delaware corporation ("Speizman"), <b>SPEIZMAN
YARN EQUIPMENT, INC.,</b> a South Carolina corporation ("Speizman Yarn"), <b>WINK DAVIS
EQUIPMENT COMPANY, INC.,</b> a Georgia corporation ("Wink Davis"), <b>TODD MOTION
CONTROLS, INC.,</b> a North Carolina corporation ("Todd Motion;" and together with Speizman, Speizman Yarn, Wink Davis and any future direct or indirect
subsidiaries of Speizman or of any other entities listed above, the
"Borrowers"), jointly and severally and their respective successors and assigns,
and <b>SOUTHTRUST BANK</b>, an Alabama banking corporation
("Lender").<p align="center">
<b><u>R</u> <u>E</u> <u>C</u> <u>I</u> <u>T</u> <u>A</u> <u>L</u> <u>S</u> :</b><p style="text-indent: 60">
<b>WHEREAS</b>, Lender and the Borrowers entered into that certain Credit Facility
Agreement dated as of May 31, 2000 (as heretofore or hereafter amended,
extended, restated or renewed, the "Credit Agreement"), for the purpose of
establishing a $17,500,000 Revolving Credit Facility and a $15,000,000 Letter of
Credit Facility with the Lender in favor of the Borrowers.  All capitalized
terms used herein and not otherwise defined shall have the respective meanings
thereunto ascribed in the Credit Agreement.  All obligations, duties and
liabilities of the Borrower from time to time existing under and pursuant to the
Credit Agreement and the other Loan Documents are sometimes collectively
referred to herein as the "Obligations"; and<p style="text-indent: 60">
<b>WHEREAS</b>, the parties amended the Credit Agreement pursuant to that certain
Amendment and Forbearance Agreement dated as of the 13<sup>th</sup> day of
November, 2000 (the "First Amendment"); and<p style="text-indent: 60">
<b>WHEREAS</b>, the parties further amended the Credit Agreement pursuant to that
certain Second Amendment and Forbearance Agreement dated July 1, 2001 (the
"Second Amendment"); and<p style="text-indent: 60">
<b>WHEREAS</b>, the parties further amended the Credit Agreement pursuant to that
certain Third Amendment and Forbearance Agreement dated February 19, 2002 (the
"Third Amendment"); and <p style="text-indent: 60">
<b>WHEREAS</b>, the parties further amended the Credit Agreement pursuant to that
certain Fourth Amendment and Forbearance Agreement dated July 31, 2002 (the
"Fourth Amendment"); and <p style="text-indent: 60">
<b>WHEREAS</b>, the parties further amended the Credit Agreement pursuant to that
certain Fifth Amendment and Forbearance Agreement dated December 31, 2002 (the
"Fifth Amendment;" and collectively with the First Amendment, the Second
Amendment, the Third Amendment and the Fourth Amendment, the
"Amendments");<p style="text-indent: 60">
<b>WHEREAS</b>, pursuant to the Amendments, Lender&#8217;s outstanding commitment
under the Revolving Credit Facility has been reduced to $15,000,000 (subject to


the borrowing base formula set forth in the Credit Facility as amended pursuant
to the Amendments and herein, regarding availability under the Revolving Credit
Facility), and the outstanding commitment under the Letter of Credit Facility
has been reduced to  $6,000,000; and <p style="text-indent: 60">
&nbsp;<font size="2" face="Times New Roman"><hr size="1" color="#000080" STYLE="page-break-after: always"></font><p style="text-indent: 60">
<b>WHEREAS</b>, the Borrowers have requested that the maturity of the Credit
Facilities under the Credit Agreement be extended, that certain terms of the
Credit Agreement be modified, and that Lender continue to forbear from taking
remedial actions as a result of the Borrowers&#8217; non-compliance with certain
covenants and warranties in the Credit Agreement (as more particularly described
in Section 2 below, the "Existing Noncompliance"); and<p style="text-indent: 60">
<b>WHEREAS</b>, the Lender is willing to accommodate the Borrowers and to continue
the forbearance requested by the Borrowers, but only upon the terms and
conditions set forth in this Agreement;<p style="text-indent: 60">
<b>NOW, THEREFORE,</b> in consideration of the foregoing Recitals, which the parties
acknowledge to be true and correct in all material respects, the Borrowers and
the Lender agree as follows:<p style="text-indent: 60">
1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Certain Definitions</u></b>.  Notwithstanding
any contrary meaning set forth in the Credit Agreement or in any other Loan
Document, the following terms shall have the meanings hereunto ascribed:</p>
<blockquote>
<p style="text-indent:60"><b>&quot;<u>Existing
Noncompliance</u>"</b> shall mean the Borrowers&#8217; current and existing failure to
comply with Sections 10.16, 10.17, 10.18 and 10.19 of the Credit Agreement, as
heretofore set forth in Sections 4.01(a), (c) and (d) of the Second
Amendment.<p style="text-indent: 60"><b>"<u>Forbearance Period</u>"</b>
shall mean the period of time commencing on the date of this Agreement, and
ending on December 31, 2003, subject to an earlier termination of the
Forbearance Period as provided in Section 3 of this
Agreement.</p>
  <p style="text-indent: 60"><b>"<u>Obligations</u>"</b> shall collectively mean all indebtedness or other
liabilities and obligations of the Borrowers to the Lender arising out of or
secured by the Loan Documents, including, without limitation (i) the
Borrowers&#8217; obligation to repay the principal amount of the Loans with
interest thereon as set forth in the Loan Documents, and (ii) the
Borrowers&#8217; obligation to pay all commitment fees, extension fees and other
agreed charges in connection with the Loans, and (iii) the Borrowers&#8217;
obligation to pay certain legal fees, court costs and other costs of collection
as set forth herein and in the other Loan Documents, and (iv) the
Borrowers&#8217; obligation to pay and discharge any and all liens or
encumbrances upon or tax liabilities with respect to the collateral described in
the Loan Documents, and (v) any and all indemnity obligations of the Borrowers
in favor of the Lender set forth in any of the Loan Documents, and (vi) the
Borrowers&#8217; obligation timely to observe and perform all other covenants
and agreements set forth in the Loan Documents.</p>
  <p align="right">2</p>
</blockquote>
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<p style="text-indent: 60">
2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Forebearance by Lender</u>.</b>  The Borrowers
acknowledge and agree that by virtue of the Existing Noncompliance, the Lender
is presently entitled to declare an Event of Default under the Credit Agreement
and exercise its rights and remedies thereunder and under the related Loan
Documents.  In consideration of the representations, warranties, promises and
covenants of the Borrowers set forth in this Agreement, and the contemplated
future performance by the Borrowers of the terms hereof and of the other Loan
Documents, the Lender hereby agrees that during the Forbearance Period (as
defined below), Lender will not enforce or exercise any remedies available to it
under the Loan Documents with respect to the Existing Noncompliance, and will
not seek collection of the Loans from the Borrowers except as set forth
herein.<p style="text-indent: 60">
3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Termination of Forebearance Period</u>.</b>
Notwithstanding the provisions of Section 2 above, the Forbearance Period shall
automatically terminate without further notice to the Borrowers or any other
person (all notice otherwise required by the Loan Documents or otherwise being
hereby waived), if (i) any case or other proceeding is instituted by or against
Borrower or any of the Guarantors under any state or federal law relating to the
bankruptcy or insolvency of debtors, including, without limitation, the United
States Bankruptcy Code, 11 U.S.C. &#167;&nbsp;101 et seq., or (ii) any material
and substantial default, event of default or "Event of Default" (as defined in
the Loan Documents), occurs under any of the Loan Documents other than the
Existing Noncompliance, or (iii) any of the acknowledgments, warranties, or
representations of Borrowers set forth herein shall be untrue or inaccurate in
any material respect as of the date made, or (iv) any Borrower shall breach,
default, or fail to perform any other obligation or agreement contained in this
Agreement.<p style="text-indent: 60">
4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Modification of Credit Facilities</u>.</b><p style="text-indent: 60">
(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Credit Facility No. 1 Termination Date is
hereby extended to December 31, 2003.  From the Effective Date of this Agreement
through the Credit Facility No. 1 Termination Date, the Revolving Credit
Commitment shall be a principal sum not to exceed the lesser of (i)
$10,000,000.00 minus the amount outstanding under the Borrowers&#8217; Automated
Clearinghouse payroll facility with Lender, or (ii) the Borrowing Base Amount
less the amount outstanding under the Borrowers&#8217; Automated Clearinghouse
payroll facility with Lender.  The Borrowers hereby waive any further right to
request that any standby letters of credit be issued under Facility No. 1.
Facility No. 1 shall continue to be administered in accordance with Article II
of the Credit Agreement, as amended by this Agreement.<p style="text-indent: 60">
(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Credit Facility No. 2 Termination Date is
hereby extended to December 31, 2003.  From the Effective Date of this Agreement
through the Credit Facility No. 2 Termination Date, the aggregate maximum
principal face amount of Documentary Letters of Credit which may be outstanding
at any one time shall not exceed the sum of $7,500,000.00, subject to reduction
as provided in Section 3.1 of the Credit Agreement.  Facility No. 2 shall
continue to be administered in accordance with Article III of the Credit
Agreement, as amended by this Agreement.<p style="text-indent: 60">
(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Immediately upon termination of the
Borrowers&#8217; existing Swap Agreement on June 3, 2003 (i) the Borrowers shall
no longer be eligible for any further Swap Agreements, and (ii) all LIBOR Loans
shall automatically be converted to Base Rate Loans.  The Borrowers agree that,
from and after the date hereof, they shall no longer be eligible to elect that
any Loan be priced as a LIBOR Loan for a LIBOR period which would extend beyond
June 3, 2003.  From and after May 3, 2003, the Borrowers agree that they shall
no longer be eligible to elect that any Loan be priced as a LIBOR Loan.<blockquote>
  <p align="right">3</p>
</blockquote>
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<p style="text-indent: 60">
(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;From
and after the Effective Date of this Agreement, the Applicable Margin for all
Base Rate Loans shall be one hundred twenty-five (125) basis points (1.25%).
Effective as of July 1, 2003, the Applicable Margin for all Base Rate Loans
shall be increased to three hundred (300) basis points (3.00%).  Accordingly,
the definition of "Applicable Margin" set forth in Section 1.6 of the Credit
Agreement is hereby amended as set forth above.<p style="text-indent: 60">
(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In consideration of this Agreement, and the
extension of maturity of Facility No. 1 and Facility No. 2 as herein set forth,
the Borrowers agree to pay to Lender an extension fee in the amount of
$150,000.00, which fee shall be fully earned by Lender, and shall be due and
payable by Borrowers, upon the execution and delivery of this Agreement.  In the
event that all outstanding Obligations of the Borrowers are paid in full, and
all Credit Facilities are terminated in full, on or before June 30, 2003, the
Lender agrees that it shall refund the sum of $50,000.00 to the Borrowers.<p style="text-indent: 60">
(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;From and after the Effective Date of this
Agreement, the Loan Documents shall each be construed and interpreted by
reference to the foregoing modifications, mutatis mutandis, such that each and
every term, covenant, condition and agreement set forth in the Loan Documents
shall, to the extent of any direct conflict with the foregoing subsections (a)
through (e), be deemed amended as the context may require.<p style="text-indent: 60">
5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Status of the Loan Documents</u>.</b>
Borrowers acknowledge and agree that this Agreement and each of the Amendments
shall for all purposes be deemed to constitute "Loan Documents" as that term is
defined in the Credit Agreement.  Borrowers further acknowledge and agree that,
except as expressly set forth in this Agreement, (i) this Agreement is not
intended to be, and shall not be deemed or construed to be, a novation or
release of the Loan Documents or any of them; (ii) except as expressly provided
in this Agreement, this Agreement is not intended to be, and shall not be deemed
or construed to be, a modification, amendment, or waiver of the Loan Documents
or any of them; (iii) neither this Agreement nor any payments made or other
actions taken pursuant to this Agreement shall be deemed to cure the Existing
Noncompliance unless and until all sums payable pursuant to the Loan Documents
are paid in full; (iv) except as otherwise expressly provided in this Agreement,
Lender reserves all available rights and remedies, at law, in equity, and under
the Loan Documents, in connection with any default or event of default,
including the Existing Noncompliance, whether now existing or hereafter
occurring, under the Loan Documents; and (v) all requirements in the Loan
Documents for notice by Lender to the Borrowers, or any of them, are hereby
waived.<p style="text-indent: 60">
6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Reaffirmation of Obligations</u>.</b>  The
Borrowers hereby ratify and affirm all terms and conditions of the Loan
Documents (as amended hereby).  The Borrowers acknowledge that, as amended and
modified by this Agreement: (i) the Loan Documents remain in full force and
effect, and (ii) the Loan Documents to which each is a party constitute the
legal, valid and binding obligations of the Borrowers, enforceable against each
of the Borrowers in accordance with their respective terms.  The Borrowers
hereby represent and warrant to Lender that as of the date hereof, the Borrowers
have no defenses, setoffs, rights of recoupment, counterclaims or claims of any
nature whatsoever in respect to the Loan Documents, and to the extent any such
defenses, setoffs, rights of recoupment, counterclaims or claims may exist,
whether known or unknown, the same are hereby expressly waived, released and
discharged.  Borrowers represent and warrant to Lender that the Loans continue
to be secured by the Loan Documents, and that except with respect to the
Existing Noncompliance, no Event of Default or default has occurred and is
continuing under the Loan Documents, and no event has occurred or failed to
occur that, with the lapse of time, giving of notice or both, would constitute
an Event of Default or default under the Loan Documents.<blockquote>
  <p align="right">4</p>
</blockquote>
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<p style="text-indent: 60">
7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Waiver and Release of Claims</u>.</b>  In
consideration of the Lender&#8217;s execution and delivery of this Agreement,
and as a material inducement therefor, effective as of the date of this
Agreement the Borrowers do hereby release, remise and discharge Lender and its
affiliates, parents, divisions, subsidiaries, successors, predecessors,
stockholders, officers, directors, agents, employees, attorneys, successors, and
assigns (Lender and such other parties being collectively referred to herein as
the "Released Parties"), of and from any and all claims, liabilities, actions,
and causes of action, if any, of whatever kind or nature, which have existed or
currently exist as of the date of this Agreement, arising out of or in any way
connected with any occurrences, acts, omissions, or transactions involving,
directly or indirectly, the Loan Agreement, or any of the Obligations, or any
other transactions or dealings between the Lender and any of the
Borrowers.<p style="text-indent: 60">
8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Representations and Warranties</u>.</b>
Borrowers represent and warrant to Lender that: (i) each Borrower is a
corporation duly organized, validly existing and in good standing under the laws
of the State of organization reflected in the heading of this Agreement, and has
full power and authority to execute, deliver and perform this Agreement and the
other Loan Documents, and the same have been duly authorized pursuant to all
requisite corporate action; (ii) this  Agreement and the other Loan Documents
constitute valid and legally binding obligations of the Borrowers, enforceable
in accordance with their respective terms, except as enforceability may be
limited by bankruptcy, insolvency or similar laws affecting the enforcement of
creditors&#8217; rights generally, and general principles of equity; (iii) the
execution, delivery and performance by the Borrowers of this Agreement and the
other Loan Documents, will not and did not violate, conflict with, or constitute
any default under any law (including laws relating to usury), government
regulation, or any other agreement or instrument binding upon the Borrowers; and
(iv) no approval, authorization or other action by, or filing with, any
governmental official, board or authority is required in connection with the
execution and delivery of this Agreement or any of the other Loan Documents, and
the performance of the provisions thereof, except such approvals and
authorizations as have been received, such actions as have been taken, and such
filings as have been made; and (v) other than the Existing Noncompliance, the
Borrowers are not in material breach or violation of any covenant, agreement or
other Obligation under the Credit Agreement or any other Loan Document.<p style="text-indent: 60">
9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Governing Law; Jurisdiction</u>.</b>  The
validity, interpretation, enforcement and effect of this Agreement and the other
Loan Documents (including, without limitation, provisions with respect to
interest, late charges, and interest on overdue installments), shall be governed
by, and construed according to the laws of, the State of North Carolina.
Lender&#8217;s principal place of business is located in Jefferson County,
Alabama, and the Borrowers agree that this Agreement has been made and delivered
to Lender, and shall be held by Lender, at such principal place of business.  By
execution and delivery of this Agreement, the Borrowers expressly and
irrevocably assent and submit to the personal jurisdiction of the state and
federal courts presiding in and over Jefferson County, Alabama, in any legal
action or proceeding arising under, out of, or in any manner relating to this
Agreement or any other Loan Document, and acknowledge that the negotiation,
execution and delivery of this Agreement constitute sufficient contacts with the
State of Alabama for purposes of independently conferring such jurisdiction.
The Borrowers further agree that the exclusive venue of any such legal action or
proceeding arising out of or in any manner relating to this Agreement or any
other Loan Document shall be in the state and/or federal courts presiding in and
over Jefferson County, Alabama, unless Lender shall, at its sole option, elect
to bring or permit the maintenance of any such action in another venue, and the
Borrowers hereby waive any and all rights under any state or federal law to
object to such venue on grounds of forum non conveniens or otherwise.<blockquote>
  <p align="right">5</p>
</blockquote>
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<p style="text-indent: 60">
10.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Waiver of Jury Trial</u>.  BORROWERS AND
LENDER HEREBY MUTUALLY WAIVE ANY RIGHT THEY MAY HAVE TO A TRIAL BY JURY IN ANY
LAWSUIT OR OTHER COURT ACTION RELATED TO THE THIS AGREEMENT, ANY OF THE LOAN
DOCUMENTS, ANY OBLIGATIONS ARISING THEREUNDER OR ANY TRANSACTION CONTEMPLATED
HEREBY OR THEREBY, INCLUDING, WITHOUT LIMITATION, IN RESPECT TO ANY CLAIM,
COUNTERCLAIM, THIRD-PARTY CLAIM, DEFENSE, OR SET-OFF ASSERTED IN ANY SUCH
LAWSUIT OR COURT ACTION.  ANY SUCH LAWSUIT OR COURT ACTION SHALL BE TRIED
EXCLUSIVELY TO A COURT WITHOUT A JURY.  THE BORROWERS SPECIFICALLY ACKNOWLEDGE
THAT THEIR EXECUTION OF THIS WAIVER CONSTITUTES A MATERIAL PORTION OF THE
CONSIDERATION RECEIVED BY THE LENDER IN EXCHANGE FOR ITS ENTERING INTO THIS
AGREEMENT.</b><p style="text-indent: 60">
11.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Payment of Expenses</u></b>.  Borrowers agree
to pay all expenses, including reasonable attorneys&#8217; fees, incurred by
Lender in connection with the negotiation and preparation of this Agreement.
The Borrowers further agree that they shall pay on demand any and all further
out-of-pocket costs or expenses hereafter incurred by Lender in connection with
the administration of the Loan Documents and/or the enforcement of the
Obligations, including reasonable attorneys&#8217; fees.<p style="text-indent: 60">
12.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b>Miscellaneous. </b>
<p style="text-indent: 60">
(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except as expressly set forth herein, Lender
shall not by any act, delay, omission, or otherwise be deemed to have waived any
of its rights or remedies under this Agreement or any other Loan Document, and
no waiver of any kind shall be valid unless in writing and signed by Lender.
<p style="text-indent: 60">
(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All rights and remedies of Lender under the
terms of this Agreement and the other Loan Documents and applicable statutes or
rules of law shall be cumulative and may be exercised successively or
concurrently.  <p style="text-indent: 60">
(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any provision in this Agreement or of any other
Loan Document which may be unenforceable or invalid under any law shall be
ineffective to the extent of such unenforceability or invalidity without
affecting the enforceability or validity of any other provision hereof or
thereof.<blockquote>
  <p align="right">6</p>
</blockquote>
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<p style="text-indent: 60">
(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Agreement and the obligations of the
Borrowers hereunder shall be binding upon and enforceable against the Borrowers
and their respective heirs, administrators, successors and assigns, and shall
inure to the benefit of Lender and its successors and assigns, including any
subsequent holder of the Notes.<p style="text-indent: 60">
(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Lender may, at its option, release any
collateral given to secure the Obligations, or release any guarantor from its
obligations under any guaranty or surety agreement, and no such release shall
impair the Obligations of any Borrower to Lender under this Agreement and the
other Loan Documents.<p style="text-indent: 60">
(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section headings are inserted for convenience
of reference only and shall be disregarded in the interpretation of this
Agreement.<p style="text-indent: 60">
(g)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No provision of this Agreement shall be
construed against or interpreted to the disadvantage of any party by reason of
such party&#8217;s having or being deemed to have drafted, structured or
dictated the terms of such provision.<p style="text-indent: 60">
(h)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Agreement may be executed in any number of
counterparts bearing the original signatures of one or more of the parties
hereto, each of which shall for all purposes be deemed an original, but all of
which, taken together, shall constitute one and the same Agreement.  It shall
not be necessary that all parties execute the same counterpart.<p style="text-indent: 60">
(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Borrowers acknowledge that prior to the
execution and delivery of this Agreement they have had full and fair opportunity
to review the same with independent legal counsel of their choosing, and that
this Agreement has been executed and delivered as a free and voluntary act of
the Borrowers, without coercion or duress.<p style="text-indent: 60">
(j)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Time is of the essence of this Agreement and
the performance of each of the covenants and agreements contained
herein.<p style="text-indent: 60">
&nbsp;<p style="text-indent: 60">
&nbsp;<p align="center">
<b>[No further text this page; Signature pages follow.]</b><blockquote>
  <p align="right">7</p>
</blockquote>
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<p style="text-indent: 60">
&nbsp;IN WITNESS WHEREOF, the parties
hereto have executed and delivered this Agreement, or have caused the same to be
properly executed and delivered, as of the day and year first above written.</p>
<p>&nbsp;<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="50%"><b>BORROWERS: </b></td>
    <td width="50%"><b>LENDER:</b></td>
  </tr>
  <tr>
    <td width="50%"><b>&nbsp;</b></td>
    <td width="50%"><b>&nbsp;</b></td>
  </tr>
  <tr>
    <td width="50%"><b>COMPANY AND SUBSIDIARIES: </b></td>
    <td width="50%"><b>LENDER:</b></td>
  </tr>
  <tr>
    <td width="50%"><b>&nbsp;</b></td>
    <td width="50%"><b>&nbsp;</b></td>
  </tr>
  <tr>
    <td width="50%"><b>SPEIZMAN INDUSTRIES, INC. (SEAL)</b></td>
    <td width="50%"><b>SOUTHTRUST BANK (SEAL)</b></td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">By:<u>
/s/ Paul Demmink&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u><br>
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Paul Demmink<br>
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Vice PresidentT</td>
    <td width="50%">By:  <u>/s/ Cole Taylor&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u><br>
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cole
Taylor<br>
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title:   Vice President</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%"><b>SPEIZMAN YARN EQUIPMENT, INC.<br>
(SEAL)</b></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">By:  <u>/s/ Paul Demmink&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    </u><br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Paul Demmink<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Title:   Vice President</td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;<p>&nbsp;</td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%"><b>TODD MOTION CONTROLS, INC.<br>
(SEAL)</b></td>
    <td width="50%">&nbsp;</td>
    </tr>
    <tr>
      <td width="50%">&nbsp;</td>
      <td width="50%">&nbsp;</td>
    </tr>
    <tr>
      <td width="50%">By:  <u>/s/ Paul Demmink&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      </u><br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Paul Demmink<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Title:   Vice President</td>
      <td width="50%">&nbsp;</td>
      </tr>
      <tr>
        <td width="50%">&nbsp;</td>
        <td width="50%">&nbsp;</td>
      </tr>
      <tr>
        <td width="50%"><b>WINK DAVIS EQUIPMENT<br>
COMPANY, INC. (SEAL)</b></td>
        <td width="50%">&nbsp;</td>
        </tr>
        <tr>
          <td width="50%">&nbsp;</td>
          <td width="50%">&nbsp;</td>
        </tr>
        <tr>
          <td width="50%">By:  <u>/s/ Paul Demmink&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          </u><br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Paul Demmink<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Title:   Vice President</td>
          <td width="50%">&nbsp;</td>
        </tr>
    </table>
<p>&nbsp;<blockquote>
  <p align="right">8</p>
</blockquote>
<font size="2" face="Times New Roman">
<hr size="1" color="#000080" STYLE="page-break-after: always"></font>
<p><b>STATE OF NORTH CAROLINA)<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
)<br>
COUNTY OF MECKLENBURG)</b></p><p style="text-indent: 60">
I, L. Gail Gormly, a Notary Public in and for said County in said State, hereby
certify that Paul Demmink, whose name as Vice President of SPEIZMAN
INDUSTRIES, INC., a Delaware corporation, is signed to the foregoing
Forbearance Agreement, and who is known to me, acknowledged before me on this
day that, being informed of the contents of such instrument, he, as such officer
and with full authority, executed the same voluntarily for and as the act of
said corporation.<p style="text-indent: 60">
Given under my hand and seal, this 1<sup>st</sup> day of April, 2003<p style="text-indent: 60">
&nbsp;<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="699">
      <tr>
        <td width="305">&nbsp;</td>
        <td width="394"><u>/s/ L. Gail
Gormly&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>
        </u>NOTARY PUBLIC </td>
        </tr>
        <tr>
          <td width="305">[SEAL]</td>
          <td width="394">&nbsp;</td>
        </tr>
        <tr>
          <td width="305">&nbsp;</td>
          <td width="394">My Commission Expires: November 11, 2005</td>
        </tr>
      </table>
<p style="margin-left:54">&nbsp;<p><b>STATE OF NORTH CAROLINA)<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
)<br>
      COUNTY OF MECKLENBURG)</b></p>
      <p style="text-indent: 60">
I, L. Gail Gormly, a Notary Public in and for said County in said State, hereby
certify that Paul Demmink, whose name as Vice President of SPEIZMAN YARN
EQUIPMENT, INC., a South Carolina corporation, is signed to the foregoing
Forbearance Agreement, and who is known to me, acknowledged before me on this
day that, being informed of the contents of such instrument, he, as such officer
and with full authority, executed the same voluntarily for and as the act of
said corporation.<p style="text-indent: 60">
Given under my hand and seal, this 1<sup>st</sup> day of April, 2003<p></p>
      <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="699">
        <tr>
          <td width="305">&nbsp;</td>
          <td width="394"><u>/s/ L. Gail
Gormly&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>
          </u>NOTARY PUBLIC </td>
          </tr>
          <tr>
            <td width="305">[SEAL]</td>
            <td width="394">&nbsp;</td>
          </tr>
          <tr>
            <td width="305">&nbsp;</td>
            <td width="394">My Commission Expires: November 11, 2005</td>
          </tr>
        </table>
        <p></p>
        <blockquote>
  <p align="right">9</p>
</blockquote>
<font size="2" face="Times New Roman">
<hr size="1" color="#000080" STYLE="page-break-after: always"></font>
<p><b>STATE OF NORTH CAROLINA)<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
)<br>
COUNTY OF MECKLENBURG)</b></p><p style="text-indent: 60">
I, L. Gail Gormly, a Notary Public in and for said County in said State, hereby
certify that Paul Demmink, whose name as Vice President of TODD MOTION
CONTROLS, INC., a North Carolina corporation, is signed to the foregoing
Forbearance Agreement, and who is known to me, acknowledged before me on this
day that, being informed of the contents of such instrument, he, as such officer
and with full authority, executed the same voluntarily for and as the act of
said corporation.<p style="text-indent: 60">
Given under my hand and seal, this 1<sup>st</sup> day of April, 2003<p></p>
        <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="699">
          <tr>
            <td width="305">&nbsp;</td>
            <td width="394"><u>/s/ L. Gail
Gormly&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>
            </u>NOTARY PUBLIC </td>
            </tr>
            <tr>
              <td width="305">[SEAL]</td>
              <td width="394">&nbsp;</td>
            </tr>
            <tr>
              <td width="305">&nbsp;</td>
              <td width="394">My Commission Expires: November 11, 2005</td>
            </tr>
          </table>
          <p></p>
          <blockquote>
  <p align="right">9</p>
</blockquote>
<font size="2" face="Times New Roman">
<hr size="1" color="#000080" STYLE="page-break-after: always"></font>
<p><b>STATE OF NORTH CAROLINA)<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
)<br>
COUNTY OF MECKLENBURG)</b></p>
<p style="margin-left:54">&nbsp;</p><p style="text-indent: 60">
I, L. Gail Gormly, a Notary Public in and for said County in said State, hereby
certify that Paul Demmink, whose name as Vice President of WINK DAVIS
EQUIPMENT, INC., a Georgia corporation, is signed to the foregoing
Forbearance Agreement, and who is known to me, acknowledged before me on this
day that, being informed of the contents of such instrument, he, as such officer
and with full authority, executed the same voluntarily for and as the act of
said corporation.<p style="text-indent: 60">
Given under my hand and seal, this 1<sup>st</sup> day of April, 2003<p>
&nbsp;</p>
          <p></p>
          <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="699">
            <tr>
              <td width="305">&nbsp;</td>
              <td width="394"><u>/s/ L. Gail
Gormly&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>
              </u>NOTARY PUBLIC </td>
              </tr>
              <tr>
                <td width="305">[SEAL]</td>
                <td width="394">&nbsp;</td>
              </tr>
              <tr>
                <td width="305">&nbsp;</td>
                <td width="394">My Commission Expires: November 11, 2005</td>
              </tr>
            </table>
            <p></p>
            <blockquote>
  <p align="right">10</p>
</blockquote>
<font size="2" face="Times New Roman">
<hr size="1" color="#000080" STYLE="page-break-after: always"></font>
<p><b>STATE OF ALABAMA&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; )<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
)<br>
COUNTY OF JEFFERSON)</b></p><p style="text-indent: 60">
I, Terri Yavonne Williams, a Notary Public in and for said County in said State,
hereby certify that Cole Taylor, whose name as Vice President of SOUTHTRUST
BANK is signed to the foregoing Forbearance, and who is known to me,
acknowledged before me on this day that, being informed of the contents of such
instrument, he, as such officer and with full authority, executed the same
voluntarily for and as the act of said SOUTHTRUST BANK.<p>
Given under my hand and seal, this 1<sup>st</sup> day of April, 2003<p>
&nbsp;</p>
            <table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="699">
              <tr>
                <td width="305">&nbsp;</td>
                <td width="394"><u>/s/ Terri Yavonne Williams&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>
                </u>NOTARY PUBLIC </td>
                </tr>
                <tr>
                  <td width="305">[SEAL]</td>
                  <td width="394">&nbsp;</td>
                </tr>
                <tr>
                  <td width="305">&nbsp;</td>
                  <td width="394">My Commission Expires: February 5, 2005</td>
                </tr>
              </table>
              <p>
&nbsp;</p>
              <blockquote>
  <p align="right">11</p>
</blockquote>
<font size="2" face="Times New Roman">
<hr size="1" color="#000080" STYLE="page-break-after: always"></font><p>
&nbsp;</p>
              <p align="center">
<b>EXHIBIT A</b><p align="center">
<b>EBITDA PROJECTIONS</b></p>


              <p align="center">
&nbsp;</p>


              <p align="center">
&nbsp;</p>


              <p align="center">
&nbsp;</p>


              <p align="center">
&nbsp;</p>


              <p align="center">
&nbsp;</p>


              <p align="center">
&nbsp;</p>


              <blockquote>
  <p align="right">12</p>
</blockquote>
<font size="2" face="Times New Roman">
<hr size="1" color="#000080" STYLE="page-break-after: always"></font><p align="center">
&nbsp;</p>


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