	UNITED STATES	OMB APPROVAL
	SECURITIES AND EXCHANGE COMMISSION	OMB Number: 3235-0060
	WASHINGTON, DC 20549	Expires: January 31, 2008
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SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT ~~PURSUANTTO~~PURSUANT TO SECTION 13 ORor 15(Dd) OF ~~THESECURITIES~~THE SECURITIES EXCHANGE ACT OF 1934

~~Date~~DATE ofOF ~~Report~~REPORT (Date of earliest event reported): ~~March 29~~May 30, 2006

Delta Mills, Inc.

(Exact name of registrant as specified in its charter)

Delaware	333-376-17	13-2677657
(State or Other Jurisdictionof Incorporation)	(Commission File Number)	(IRS Employer Identification No.)
700 Northwood Drive, Fountain Inn, South Carolina		29644
(Address of principal executive offices)		(Zip Code)

Delaware

~~Registrant’s~~(State ~~Telephone~~or ~~Number~~Other ~~Including Area Code: (864) 255-4127~~Jurisdiction

of Incorporation)


333-376-17		13-2677657

(Commission File Number)		(IRS Employer Identification No.)


700 Northwood Drive, Fountain Inn, South Carolina		29644

(Address of principal executive offices)		(Zip Code)

(864) 255-4127

(Registrant’s Telephone Number

Including Area Code)

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below)

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2 1.0201. ~~Results~~Entry ofinto ~~Operations~~a ~~and~~Material ~~Financial~~Definitive Agreement ~~Condition.~~

As On ~~described~~May 30, ~~below~~2006, ~~under~~Delta ~~Item 8~~Mills, Inc.01 of(“Delta ~~this~~Mills”) ~~Current~~entered ~~Report~~into onan ~~Form~~amended ~~8-K,~~and onrestated ~~April~~credit facility ~~17,~~with ~~2006~~GMAC ~~the~~Commercial ~~Company~~Finance, ~~commenced~~LLC a(“GMAC”), ~~tender~~as ~~offer~~agent ~~for~~and ~~its~~as ~~9-5/8%~~lender. ~~Senior~~Delta ~~Notes due 2007 and a related~~Mills’ ~~solicitation~~factoring ofarrangement ~~consents~~with ~~from~~GMAC ~~holders~~was ofalso ~~those~~amended ~~notes~~and torestated, ~~amendments~~including toan ~~the~~extension ~~Indenture~~of ~~related~~its term to ~~those~~May 30, ~~notes~~2009. The ~~Company’s~~credit ~~Offer~~facility toconsists ~~Purchase~~of ~~and Consent~~a ~~Solicitation~~$40 million ~~dated~~credit ~~April 17~~facility, ~~2006~~of iswhich up ~~attached~~ to ~~this~~$9 million ~~Form~~may ~~8-K~~potentially be advanced as ~~Exhibit~~term 99loans.1 ~~and~~The ~~contains~~facility ~~statements~~will ~~regarding~~terminate ~~the~~on ~~Company’s results of~~May 30, ~~operations for the fiscal quarter ended April 1~~2009, ~~2006~~and ~~under~~earlier ~~the~~prepayment ~~heading~~and ~~“Factors~~termination towill begenerally ~~Considered~~require ~~by Noteholders — Forecasted results for~~ the ~~remainder~~ payment of ~~fiscal~~a ~~2006 and for fiscal 2007~~premium.”

~~Item~~ The 8maximum revolving loan amount is the lesser of $40 million (as reduced by the $9 million term loan maximum amount until the end of the term loan commitment period described below, and by the amount of outstanding term loans, if any, thereafter) and a borrowing base calculation consisting of (i) up to 90% of eligible accounts receivable, and (ii) up to the lesser of (x) 50% of the lower of cost or market of eligible inventory or (y) $15 million, less (a) an availability block of up to $7 million, and less (b) such reserves as are determined from time to time by GMAC.01 ~~Other~~If ~~Events~~any term loans are outstanding, the amount of those term loans will create an additional reserve against the borrowing base. The revolving credit facility includes a $2 million sublimit for letters of credit. Proceeds of revolving loans may be used for working capital purposes and general corporate purposes and to pay for the fees and expenses of the transaction. Revolving loans will bear interest at prime plus 2.75% per annum.

~~North~~ The purpose ~~Carolina~~of ~~Corporate~~the ~~Income~~term loan facility is to fund purchases of Delta Mills’ 95/8% Senior Notes due 2007 (the “Senior Notes”). The maximum amount of outstanding term loans is $9 million. Term loans will bear interest at prime plus 4.00% per annum. The term loan facility includes a multiple draw feature with the proceeds to fund purchases of Senior Notes at a discount satisfactory to GMAC, and ~~Franchise~~term loans may be prepaid without penalty (but may not ~~Taxes~~be re-borrowed) under the terms of the credit facility. Any permitted draws under the term loan facility must be made prior to the end of the term loan commitment period, which extends to the earlier of March 31, 2007, and the date on which all Senior Notes have been repurchased. Term loans will amortize monthly based on a five-year level principal amortization schedule. As noted above, the amount of outstanding term loans forms a reserve against Delta Mills’ borrowing base.

As The ~~previously~~amended ~~reported,~~and ~~during 1998~~restated ~~Delta~~credit ~~Woodside~~agreement ~~Industries,~~includes ~~Inc.~~provisions ~~(“Delta~~relating ~~Woodside”),~~to the ~~parent~~grant ~~corporation~~ of ~~the~~liens to ~~Company, received notices from~~ the ~~State~~agent ~~of North Carolina asserting deficiencies~~ in ~~state~~additional ~~corporate~~personal ~~income~~ and ~~franchise~~real ~~taxes~~property ~~for~~assets ~~the 1994–1997 tax years~~ of ~~a corporation that was a wholly-owned subsidiary of~~ Delta ~~Woodside and merged into Delta Woodside in 2000~~Mills. ~~The~~However, ~~total~~because ~~assessment proposed by the State amounted to approximately $1.5 million,~~this ~~which~~grant ~~included interest and penalties at that time. The assessment~~ was ~~delayed~~conditioned ~~pending~~on anthe ~~administrative~~consummation ~~review~~ of the ~~case~~offer byto ~~the~~purchase ~~State.~~Senior InNotes ~~2005,~~that ~~the~~commenced on ~~North~~April 17, ~~Carolina~~2006 ~~Department of Revenue~~ (the “~~Department~~Offer”), ~~informed~~and ~~Delta Woodside that it must either pay~~ the ~~original~~Offer ~~assessment~~was ~~in full (plus~~not ~~interest)~~consummated, orthese ~~continue~~provisions ~~its~~are ~~appeal~~currently ~~in an administrative tax hearing before the North Carolina Secretary of Revenue. Delta Woodside determined to continue~~without ~~with its appeal and contested portions of the assessments~~effect.

By The ~~letter~~amended ~~dated February 28, 2006, the Department submitted to Delta Woodside revised auditor’s reports reflecting corporate~~ and ~~franchise~~restated ~~taxes~~credit ~~due~~agreement ~~for~~contains ~~the~~minimum ~~1994–1997~~12-month ~~tax~~trailing EBITDA ~~years~~requirements, ~~plus~~as ~~penalties~~well ~~and~~as ~~interest~~restrictions ~~through~~on ~~March~~future ~~2006,~~stock ~~aggregating approximately $246~~repurchases,~~000.~~ ~~By letter dated March 29~~dividends, ~~2006,~~capital ~~Delta Woodside informed the~~expenditures, ~~Department~~investments ~~that it accepts the Department’s revised auditor’s reports~~ and ~~further~~sales ~~informed~~of ~~the~~assets. ~~Department~~In ~~that~~certain ~~Delta~~circumstances, ~~Woodside~~proceeds ~~intends~~of toassets ~~file North~~sales ~~Carolina~~will ~~corporate income and franchise tax returns for the predecessor corporation for the 1998–2000 tax years. Delta Woodside estimates~~be ~~that~~required ~~its~~to ~~aggregate~~repay ~~liability~~outstanding ~~for~~amounts ~~corporate~~under ~~and franchise taxes, penalties and interest for~~ the ~~1998-2000~~credit ~~tax years will be approximately $105,000~~facility. AsEvents ~~a result~~ of ~~this~~default ~~resolution~~under of the credit ~~matter,~~facility ~~Delta~~include ~~Woodside anticipates reducing for~~ the ~~third~~circumstance ~~quarter~~ of ~~fiscal~~any ~~year~~Senior ~~2006~~Notes ~~its~~remaining ~~income~~outstanding ~~tax~~on ~~reserves (which~~March 31, ~~had~~2007, ~~included management’s estimate for the unaudited 1998–2000 tax years~~ as well as ~~the~~other ~~audited~~standard ~~1994–1997~~events ~~tax years) by approximately $2.0 million. This resolution~~ of ~~the matter will have no effect on the Company’s financial statements~~default.

As A ~~previously~~copy ~~reported,~~of ~~Delta Woodside Industries, Inc. (and not~~ the ~~Company)~~amended ~~is the corporate entity that is subject to the Department’s assessment,~~ and ~~the~~restated ~~amount~~credit ~~assessed~~agreement ~~by the Department exceeds the liquid assets of that corporate entity. Delta Woodside has informed the Department that, due to Delta Woodside’s financial condition, it~~ is ~~not~~attached ~~currently~~as able to pay the revised amounts of tax, interest and penalties in full and wants to discuss with the Collections Division of the Department all payment options that may be available, including a payment plan and an offer in compromiseExhibit 10. ~~The ultimate resolution of this payment issue is uncertain~~1.

~~Commencement of Tender Offer for the Company’s Outstanding 9-5/~~Item 8%.01 ~~Senior~~Other ~~Notes due 2007 and Solicitation of Consents to Amendments to the Indenture for the Senior Notes.~~Events

OnExpiration ~~April~~of ~~17,~~Delta ~~2006,~~Mills ~~the~~Tender ~~Company commenced~~Offer afor ~~tender offer to acquire all of~~ its ~~outstanding~~Outstanding ~~9-5~~95/8% Senior Notes due 2007 ~~(the “Senior Notes”). The Company is simultaneously~~and ~~seeking~~Solicitation ~~the consents~~ of ~~holders~~Consents ~~of a majority in aggregate principal amount of the outstanding Senior Notes~~ to ~~amendments~~Amendments to the Indenture ~~governing~~ for the Senior Notes ~~to delete or amend certain covenants and related definitions and events of default relating to the incurrence of indebtedness, liens~~ ~~and asset sales. The Company’s Offer to~~

~~Purchase~~ On April 17, 2006, Delta Mills commenced a tender offer to acquire all of its outstanding 95/8% Senior Notes due 2007, simultaneously seeking the consents of holders of a majority in aggregate principal amount of the outstanding Senior Notes to amendments to the Indenture governing the Senior Notes to delete or amend certain covenants and ~~Consent~~related ~~Solicitation~~definitions ~~dated~~and ~~April~~events 17of default relating to the incurrence of indebtedness, liens and asset sales. After being extended on May 25, 2006, isthe offer expired on May 30, 2006. Delta Mills received tenders of, and consents to the ~~attached~~proposed amendments to ~~this~~the ~~Form~~Senior ~~8-K~~Notes asIndenture ~~Exhibit~~from 99holders of, $7,602,000 in principal amount of Senior Notes (approximately 25% of the total principal amount outstanding).1 Because consummation of the tender offer and isconsent ~~incorporated~~solicitation ~~herein~~was byconditioned ~~reference~~upon receipt of consents with respect to at least a majority in principal amount of the outstanding Senior Notes, Delta Mills did not accept any tenders or consents, and the Indenture will not be amended as a result of the offer and solicitation.

Item 9.01 Financial Statements and Exhibits.

(c)		Exhibits

10.1		Amended and Restated Revolving Credit, Term Loan and Security Agreement, dated as of May 30, 2006, between Delta Mills, Inc. and GMAC Commercial Finance, LLC

99.1 Offer to Purchase and Consent Solicitation of the Company dated April 17, 2006.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

DELTA MILLS, INC.



	DELTA MILLS, INC.

Date: June 5, 2006	By:	/s/ W.H. Hardman, Jr.

	W.H. Hardman, Jr.
	Chief Financial Officer

Date: April 17, 2006

By: /s/ W.H. Hardman, Jr. W.H. Hardman, Jr. Chief Financial Officer

Exhibits

9910.1 ~~Offer~~Amended toand ~~Purchase~~Restated ~~and~~Revolving ~~Consent~~Credit, ~~Solicitation~~Term ofLoan ~~the~~and ~~Company~~Security Agreement, dated ~~April~~as 17of May 30, 2006, between Delta Mills, Inc. and GMAC Commercial Finance, LLC

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