Collateral Assignment

This COLLATERAL ASSIGNMENT OF PURCHASE AGREEMENTS (this "Assignment"), dated as of October 3, 2003, is entered into among MJS ACQUISITION COMPANY, a North Carolina corporation ("MJS"), DELTA APPAREL, INC., a Georgia corporation ("Delta"; together with MJS, each, a "Debtor" and collectively, "Debtors"), and CONGRESS FINANCIAL CORPORATION (SOUTHERN), as agent for Delta Lenders (as defined below) and as agent for Soffe Lenders (as defined below) (in either or both capacities, "Secured Party").


W I T N E S S E T H:


WHEREAS, Secured Party, Soffe Lenders and MJS have entered or are about to enter into financing arrangements pursuant to which Soffe Lenders may make loans and advances and provide other financial accommodations to MJS as set forth in the Loan and Security Agreement, dated the date hereof, by and among Secured Party, the financial institutions party thereto as lenders (collectively, "Soffe Lenders") and MJS (as the same now exists or may hereafter be amended, modified, supplemented, extended, renewed, restated or replaced, the "Soffe Loan Agreement"; capitalized terms used herein and not otherwise defined shall have the meaning ascribed to such terms in the Soffe Loan Agreement) and other notes, guarantees, agreements, documents and instruments referred to therein or at any time executed and/or delivered in connection therewith or related thereto, including, but not limited to, this Assignment (all of the foregoing, together with the Soffe Loan Agreement, as the same now exist or may hereafter be amended, modified, supplemented, extended, renewed, restated or replaced, being collectively referred to herein as the "Soffe Financing Agreements"); and


WHEREAS, as an inducement to Secured Party and Soffe Lenders to enter into the Soffe Loan Agreement and to make the loans thereunder, Delta has agreed to guarantee the obligations of MJS to Secured Party and Soffe Lenders pursuant to that certain Guarantee dated the date hereof (as amended, modified, supplemented, extended or restated from time to time, the "Soffe Loan Agreement Guarantee"), by Delta and SAIM, LLC in favor of Secured Party, on behalf of Secured Party and Soffe Lenders, and has agreed to secure its obligations under the Soffe Loan Agreement Guarantee as provided herein; and


WHEREAS, Secured Party, the financial institutions party thereto as lenders (collectively, "Delta Lenders"; together with Soffe Lenders, collectively, "Lenders") and Delta have entered or are about to enter into financing arrangements pursuant to which Delta Lenders may make loans and advances and provide other financial accommodations to Debtor as set forth in the Amended and Restated Loan and Security Agreement, dated the date hereof, by and among Secured Party, Delta Lenders and Delta (as the same now exists or may hereafter be amended, modified, supplemented, extended, renewed, restated or replaced, the "Delta Loan Agreement"; together with the Soffe Loan Agreement, collectively, the "Loan Agreements") and other notes, guarantees, agreements,


documents and instruments referred to therein or at any time executed and/or delivered in connection therewith or related thereto, including, but not limited to, this Assignment (all of the foregoing, together with the Delta Loan Agreement, as the same now exist or may hereafter be amended, modified, supplemented, extended, renewed, restated or replaced, being collectively referred to herein as the "Delta Financing Agreements" and together with the Soffe Financing Agreements, collectively, the "Financing Agreements"); and


WHEREAS, as an inducement to Secured Party to enter into the Delta Loan Agreement and to make the loans thereunder, MJS has agreed to guarantee the obligations of Delta to Secured Party pursuant to that certain Guarantee, dated as of the date hereof (as amended, modified, supplemented, extended or restated from time to time, the "Delta Loan Agreement Guarantee"; together with the Soffe Loan Agreement Guarantee, each a "Guarantee" and collectively, the "Guarantees"), by MJS and SAIM, LLC in favor of Secured Party, on behalf of Secured Party and Delta Lenders, and has agreed to secure its obligations under the Delta Loan Agreement Guarantee as provided herein; and


WHEREAS, MJS, Delta, M. J. Soffe Co. and James F. Soffe, John D. Soffe and Anthony M. Cimaglia (collectively, "Sellers") have entered into those certain documents set forth on Schedule 1 attached hereto and made a part hereof, along with the Exhibits and Schedules attached thereto (collectively, the "Soffe Stock Purchase Documents"); and


WHEREAS, pursuant to the Soffe Stock Purchase Documents, Sellers have made certain representations and warranties to, and covenants and indemnities in favor of, Debtors (collectively, the "Seller Commitments"); and


WHEREAS, it is a condition precedent to the execution and delivery of the Soffe Loan Agreement by Secured Party and Soffe Lenders and the execution and delivery of the Delta Loan Agreement by Secured Party and Delta Lenders and the extension of the loans and other financial accommodations to MJS under the Soffe Loan Agreement and to Delta under the Delta Loan Agreement that each Debtor assign to Secured Party, for the benefit of Secured Party and Lenders, as additional security for the repayment of the Obligations (as defined in the Loan Agreements) and the Guaranteed Obligations (as defined in the Guarantees), all of such Debtor's rights and remedies with respect to any and all of the Seller Commitments;


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


1. ASSIGNMENT OF RIGHTS. Subject to the terms of this Assignment, each Debtor hereby collaterally assigns and transfers to Secured Party, for the benefit of Secured Party and Lenders, as additional security for the repayment in full of the Obligations (as defined in the Loan Agreements) and the Guaranteed Obligations (as defined in the Guarantees), all of such Debtor's rights and remedies under or pursuant to the Soffe Stock Purchase Documents. Secured Party shall not, by virtue of this Assignment, obtain rights or remedies against Sellers greater than the rights and remedies each Debtor has against Sellers with respect to such assigned rights and remedies. This Assignment and Secured Party's rights hereunder shall be subject to all of the limitations and defenses available to the Sellers, and all requirements and conditions


applicable to Sellers and Debtors, under the Soffe Stock Purchase Documents, including, without limitation, setoff rights, indemnification baskets and liability limitations, exclusive remedy provisions, notice requireme ...