Installment Note

INSTALLMENT NOTE
$1,580,717.73
BIRMINGHAM, ALABAMA
MAY 1, 1994


For value received, the under signed (whether one or more, hereafter called the "Obligors") promise(s) to pay to the order of SOUTHTRUST BANK OF ALABAMA, NATIONAL ASSOCIATION (hereinafter called the "Bank" or, together with any other holder of this note, the "Holder"), at any office of the Bank in BIRMINGHAM, ALABAMA, or at such other place as the Holder may designate, the principal sum of ONE MILLION FIVE HUNDRED EIGHTY THOUSAND SEVEN HUNDRED SEVENTEEN, AND 73/100 Dollars, together with interest thereon at the rate provided below from the date of this note (or other interest accrual date shown below) until maturity (whether as originally scheduled or upon acceleration following default), and with interest on the unpaid balance of the principal sum (plus accrued but unpaid interest at maturity, to the extent permitted by law) at the rate which is 2 percent per annum in excess of the rate provided below or the maximum rate allowed by law, whichever is less, from maturity until said indebtedness is paid in full, Interest will continue to accrue daily on the entire unpaid balance of the principal sum of this note until each payment under this note is received by the Holder at the address provided above. Interest will accrue beginning on the date of this note unless another date is shown here: APRIL 29, 1994.


INTEREST RATE -----Variable Rate Interest will accrue on the above-stated principal sum as follows (mark applicable provision): Interest will accrue on the above-stated principal sum at the rate per annum which is __________ percentage points in excess of the Index Rate. Unless another rate is made applicable below, the "Index Rate" is the rate of interest designated by the Bank periodically as its Base Rate. The Base Rate is not necessarily the lowest rate charged by the Bank. The Base Rate on the date of this note is _____ percent. _____ (check box if applicable) The "Index Rate" is the weekly auction average yield of ____ -week U.S. Treasury Bills at the most recent auction prior to the date of the interest rate payable under this note is calculated. The Index Rate on the date of this note is ______ percent. The rate of interest payable under this note will change to reflect any change in the Index Rate: _____ on any day the Index Rate changes. ___ on the _________ day of each month hereafter. _____ on the day each payment of interest is due as provided below. _________________________ Obligors may prepay this note in full at any time without penalty.


_____ Fixed Rate Interest will accrue on the above-stated principal sum at the rate of 7.70 percent per annum.


Interest on the principal sum will be calculated at the rate set forth above on the basis of a 360-day year and the actual number of days elapsed by multiplying the principal sum by the per annum rate set forth above, multiplying the product thereof by the actual number of days elapsed, and dividing the product so obtained by 360.


PAYMENT SCHEDULE _______ Installments of Principal, Interest Paid Separately The above-stated principal sum and interest thereon shall be paid as follows (mark applicable provision): The Obligors promise to pay the above-stated principal sum in ________ consecutive _____ monthly installments _____ quarterly installments _________ installments in the amount of $ _________ each, beginning _______, 19 ____ and continuing on the same day of each month, quarter, or other period (as applicable) thereafter until _________, 19___ at which time a final installment in the amount of the unpaid balance of the principal sum and all accrued but unpaid interest thereon shall be due and payable.


The Obligors promise to pay accrued interest on the principal sum: _____ monthly ____ quarterly __________________________ beginning ____________ 19,____ and continuing on the same day of each month, quarter, or other period (as applicable) thereafter until final maturity of the principal sum.


_X_ Installments of Principal and Interest The Obligors promise to pay the above-stated principal sum and interest thereon in 59 consecutive _X_ monthly installments ___ quarterly installments ______ installments in the amount of $31,824.79 each, beginning June 1, 1994 and continuing on the same day of each month, quarter, or other period (as applicable ) thereafter until May 1, 1999 at which time a final installment in the amount of the unpaid balance of the principal sum and all accrued but unpaid interest thereon shall be due and payable.


All payments under this note shall be made in U.S. dollars and in immediately available funds at the place where payment is due.


LOAN FEE (This provision applicable only if completed):


A loan fee in the amount of $ -0- has been included in the amount of this note and paid to the Bank from the loan proceeds ____ paid to the Bank by cash or check at closing. The loan fee is earned by the Bank when paid and is not subject to refund except to the extent required by law.


LATE CHARGE If any scheduled payment is in default 10 days or more, Obligors agree to pay a late charge equal to 5% of the amount of the payment which is in default, but not less than $.50 or more than the maximum amount allowed by applicable law. The preceding sentence does not apply if the original principal amount of this Note is less than $2,000.


COLLATERAL This note is secured by every security agreement, pledge, assignment, stock power, mortgage, deed of trust, security deed and/or other instrument covering personal or real property (all of which are hereinafter included in the term "Separate Agreements") which secures an obligation so defined as to include this note, including without limitation all such Separate Agreements which are of even date herewith and/or described in the space below. In addition, as security for the payment of any and all liabilities and obligations of the Obligors to the Holder (including this note and the indebtedness evidenced by this note and all extensions, renewals and modifications thereof, and all writings delivered in substitution therefor) and all claims of every nature of the Holder against the Obligors, whether present or future, and whether joint or several, absolute or contingent, matured or unmatured, liquidated or unliquidated, direct or indirect (all of the foregoing are hereinafter included in the term "Obligations"), the Obligor hereby assign to the Holder and grant to the Holder a security interest in and security title to the property (the "Collateral") described below: (Describe Separate Agreements and Collateral.)


VARIOUS EQUIPMENT MORE PARTICULARLY DESCRIBED ON SECURITY AGREEMENT DATED MAY 1, 1994 AND MADE PART THEREOF BY THIS REFERENCE.


The Obligors are jointly and severally liable for the payment of this note and have subscribed their names hereto without condition that anyone else should sign or become bound hereon and without any other condition whatever being made. The provisions printed on the back of this page are a part of this note. The provisions of this note are binding on the heirs, executors, administrators, successors and assigns of each and every Obligor and shall inure to the behalf of the Holder, its successors and assigns. This note is executed under the seal of each of the Obligors and of the indorsers, if any, with the intention that it be an instrument under seal.


CAUTION; IT IS IMPORTANT THAT YOU THOROUGHLY READ THE CONTRACT BEFORE YOU SIGN IT.


Address of Obligor: 215 COMMERCE BLVD.
ANDERSON, SOUTH CAROLINA 29622


No. 5160099/15583


HAMPSHIRE DESIGNERS, INC. By: /s/ Charles W. Clayton, Vice President


If the Obligors fail to pay any installment of principal or interest or any other sum under this note exactly when it is due or fail to perform any other covenant under this Note when due (time being of the essence of every term of this note); or if any of the Obligors shall fail to pay any other debt or obligation to the Holder exactly when due; or if any of the Obligors or any guarantor or indorser of this note shall die (if an individual) or dissolve or cease to do business (if a partnership or corporation); or (if any of the Obligors or any guarantor or indorser of this note become insolvent, or makes a general assignment for the benefit of creditors, or files or has filed against him, her, or if a petition under any chapter of the United States Bankruptcy Code, or files, or has filed against him, her, or if an application in any court for the appointment of a receive or trustee for any substantial part of his, hers, or its property or assets; or if a judgment or arbitration award is entered against any of the Obligors or any such guarantor or indorser or a levy, writ of execution, attachment, garnishment, seizure or similar writ or judicial process is issued against any of the Obligers or any such guarantor or indorser or any of his, hers, or its property or assets; or if any Obligor, indorser or guarantor of this note transfers all or any valuable part of his, her or its assets outside the ordinary course of business, or wastes, losses, or dissipates or permits waste, loss or dissipation of any valuable part of such person's assets; of if any Obligor, indorser or guarantor of this note is a partnership, and any general partner of such partnership withdraws or is removed; or if any obligor, indorser or guarantor of this note is a corporation and ownership or power to vote more than 50 percent of the voting stock of such corporation is transferred, directly or indirectly (including through any voting trust, irrevocable proxy, or the like), during any 12 month period; or if any default or breach occurs under any of the Separate Agreements; or if any of the Obligors or any indorser or guarantor breaches any subordination agreement or enter creditor agreement made with or for the benefit of the holder; or if at any time in the opinion of the Holder the prospect of payment or performance by any Obligor or any guarantor or indorser of this note becomes impaired, then , if any of the foregoing shall occur, the entire unpaid principal sum of this note and all accrued but unpaid interest thereon shall, at the option of the Holder and without requirement of notice or demand, become due and payable immediately, notwithstanding any time or credit allowed under this note or under any other agreement made by the Holder with Obligors.


Each Obligor and each guarantor and indorser agrees (a) in the event such Obligor, guarantor or indorser is other than an individual, to furnish the Holder at least annually, within 120 days after the end of each calendar year or other fiscal year of such entity, a current financial statements, including a balance sheet and statements of income, cash flows and changes in capital for such year, setting forth in each case in comparative form the corresponding figures for the previous year, together with accompanying schedules and footnotes along with the accountant's letter accompanying the financial statement (if the financial statements were complied or certified by a public accountant, such financial statements to be certified by the chief executive officer, chief financial officer, managing partner or comparable financial officer of such Obligor, guarantor or indorser to be true and complete to the best of his or her knowledge and information and to have been prepared in accordance with generally accepted accounting principles or, if not so prepared, setting forth the manner in which such financial statement departs form generally accepted accounting principles; (b) in the event such Obligor, guarantor or indorser is an individual, to furnish the Holder at least annually, within 90 days after each anniversary date of this note, a personal financial statements in form satisfactory to the Holder, certified by such person to be true and complete to the best of his or her knowledge and belief, and to furnish the Holder, within 30 days after the Holder's request therefore, a copy of the federal income tax return most recently filed by such person; and (c) that this paragraph applies in addition to and not in lieu of any other agreement with the Holder which requires the furnishing of financial information.


As additional Collateral for the payment of all Obligations, the Obligors jointly and severally transfer, assign, pledge, whether in trust for any Obligor or for custody, pledge, collection or otherwise, is now or hereafter in the actual or constructive possession of, or in transit to, the Holder in any capacity, its correspondents or agents, and also continuing lien upon and right of set-off against deposits and credits of each Obligor with, and all claims of each Obligor against the Holder now or at any time or times and without prior notice to apply such property, deposits, credits and claims, in whole or in part and in such order as the Holder may elect, to the payment of, or as a reserve against, one or more of the Obligations, whether other Collateral therefor is deemed adequate or not. All such property, deposits, credits and claims of the Obligors are included in the term Collateral, and the Holder shall have (unless prohibited by law) the same rights with respect to such collateral as it has with respect to other Collateral.


Without the necessity for any further notice to or consent of any Obligor, the Holder may exercise any rights of any of the Obligors with respect to any Collateral, including without limitation thereto the following rights: (1) to record or register in, or otherwise transfer into, the name of the Holder or its nominees any part of the Collateral, without disclosing that the Holder's interest is that of a secured part; (2) to pledge or otherwise transfer any or all of the Obligations and/or Collateral, whereupon any pledgee or transferee shall have all the rights of the Holder hereunder, and the Holder shall thereafter be fully discharged and relieved from all responsibility and liability for the Collateral so transferred but shall retain all rights and powers thereunder as to all Collateral not so transferred; (3) to take possession of any Collateral and to receive any proceeds of and dividends and income on any Collateral, including money, and to hold the same as Collateral or apply the same to any of the Obligations, the manner, order and extent of such application to be in the sole discretion of the Holder; (4) to exercise any and all rights of voting, conversion, exchange, subscription and other rights or options pertaining to any Collateral; and (5) to liquidate, demand, due for, collect, compromise, receive and give receipt for the cash or surrender value of any Collateral. If for any reason whatsoever the collateral shall cease to be satisfactory to the Holder, the Obligors shall upon demand deposit with the Holder additional Collateral satisfactory to the Holder. Surrender of this note, upon payment or otherwise, shall not affect the right of the Holder to retain the Collateral as security for other Obligations. Upon default, the Obligors agree to assemble the Collateral and make it available to Holder at such place or places as the Holder shall designate.


The Holder shall be deemed to have exercised reasonable care in the custody and preservation of any of the Collateral which is in its possession if it takes such reasonable actions for that purpose as the pledgor of such collateral shall request in writing, but the Holder shall have the sole discretion to determine whether such actions are reasonable. Any omissions to do any act not requested by the pledgor shall not be deemed a failure to exercise reasonable care. The Obligors shall be responsible for the preservation of the Collateral and shall take all steps to preserve rights against prior parties. The holder shall not be liable for, and no Obligor, indorser, or guarantor shall be discharged to any extent on account of, any failure to realize upon, or to exercise any right or power with respect to, any of the Obligations or Collateral, or for any delay in so doing.


The Holder, without making any demand whatsoever, shall have the right to sell all or any part of the collateral, although the Obligations may be contingent or unmatured, whenever the Holder considers such sale necessary for its protection. Sale of the Collateral may be made, at any time and from time to time, at any public or private sale, at the option of the Holder, without advertisement or notice to any Obligor, except such notice as is required by law and cannot be waived. The Holder may purchase the Collateral at any such sale (unless prohibited by law) free from any equity of redemption and from all other claims. After deducting all expenses including legal expenses and attorney's fees as provided below, for maintaining or selling the Collateral and collecting the proceeds of sale, the Holder shall have the right to apply the remainder of said proceeds in payment of, or as a reserve against, any of the Obligations, the manner, order and extent of such application to be in the sole discretion of the Holder. To the extent notice of any sale or other disposition of the Collateral is required by law to be given to any Obligor and cannot be waived, the requirement of reasonable notice shall be met by sending such notice, as provided below, at least ten (10) calendar days before the time of sale or disposition. The Obligor shall remain liable to the Holder for the payment of any deficiency with interest at the rate provided hereinabove. However, the Holder shall not be obligated to resort to any Collateral but, at its election, may proceed to enforce any of the obligations in default against ...