TRANSFER AND ADMINISTRATION AGREEMENT
                                
               TRANSFER   AND   ADMINISTRATION  AGREEMENT   (this
"Agreement"), dated as of October 23, 1997, by and  among  METRIS
FUNDING  CO.,  a  Delaware corporation, as  transferor  (in  such
capacity,  the "Transferor"), DIRECT MERCHANTS CREDIT CARD  BANK,
NATIONAL  ASSOCIATION, a national banking association  ("DMCCB"),
as  collection agent (in such capacity, the "Collection  Agent"),
KITTY  HAWK  FUNDING  CORPORATION, a  Delaware  corporation  (the
"Company"), and NATIONSBANK, N.A., a national banking association
("NationsBank"), as agent for the Company and the Bank  Investors
(in such capacity, the "Agent") and as a Bank Investor.

                     PRELIMINARY STATEMENTS
                                
               WHEREAS,  the  Transferor may  desire  to  convey,
transfer  and  assign,  from time to time,  undivided  percentage
interests  in  certain accounts receivable, and the  Company  may
desire  to,  and the Bank Investors, if requested, shall,  accept
such  conveyance,  transfer  and  assignment  of  such  undivided
percentage interests, subject to the terms and conditions of this
Agreement.

               NOW,  THEREFORE,  the  parties  hereby  agree   as
follows:

                                
                            ARTICLE I
                                
                           DEFINITIONS
                                
SECTION 1.

          SECTION 1.1.     Certain Defined Terms.
          
               As  used  in  this Agreement, the following  terms
shall have the following meanings:

               "Account"  shall  mean  each  VISA  or  MasterCard
account  in  existence  as of the Cut-Off  Date  pursuant  to  an
Account Agreement, which accounts were sold by Mercantile to  the
Seller pursuant to the Mercantile Agreement and by the Seller  to
the  Initial  Purchaser  and  by the  Initial  Purchaser  to  the
Transferor  pursuant,  respectively, to the Receivables  Purchase
Agreements,  which  is identified by account number  and  by  the
outstanding balance as of the Cut-Off Date and referred to in the
Account  Schedule  delivered to the Agent  on  the  Closing  Date
pursuant  to  Section  2.8, including any  Related  Account,  any
Related  Account  established after  the  Cut-Off  Date  and  any
Account converted to the Seller's systems, shall be identified on
the  Account Schedule, as such schedule may be amended from  time
to time pursuant to Section 2.8.

               "Account  Agreement"  shall  mean  the  cardholder
agreements  and Federal Truth in Lending Statement for  Accounts,
between  an Obligor and, originally, Mercantile, or to which  the
Seller has become a party, as such agreements or statement may be
amended, modified or otherwise changed from time to time.

               "Account  Schedule"  shall mean  the  schedule  of
Accounts (which schedule may be in the form of a computer file or
microfiche)  of  the Transferor delivered to  the  Agent  on  the
Closing  Date, as amended or modified from time to time  pursuant
to the terms of this Agreement.

               "Accrued  Interest  Component"  means,   for   any
Collection Period, that portion of the Interest Component of  all
Related  Commercial  Paper outstanding at any  time  during  such
Collection  Period which has accrued from the first  day  through
the  last  day  of  such Collection Period whether  or  not  such
Related  Commercial Paper matures during such Collection  Period,
based on the actual number of days in such Collection Period that
such Related Commercial Paper was outstanding.

               "Additional   Investment  Certificate"   means   a
certificate, in substantially the form attached hereto as Exhibit
A  or  in  such  other  form  as is mutually  agreed  to  by  the
Transferor  and  the  Agent, furnished by  the  Collection  Agent
pursuant to Section 2.11 hereof.

               "Adjusted LIBOR Rate" means, with respect  to  any
period  during  which  the return to any  Bank  Investor  or  the
Liquidity Provider is to be calculated by reference to the London
interbank offered rate, a rate which is (x) .375% while FCI  owns
any  outstanding capital stock of the Initial Purchaser, and  (y)
thereafter, .875% in excess of a rate per annum equal to the  sum
(rounded upwards, if necessary, to the next higher 1/100  of  1%)
of  (A)  the  rate obtained by dividing (i) the applicable  LIBOR
Rate  by  (ii) a percentage equal to 100% of the maximum  reserve
requirement  as  specified in Regulation  D  (including,  without
limitation,  any  marginal, emergency, supplemental,  special  or
other  reserves)  that  is applicable to the  Agent  during  such
period  in respect of eurocurrency or eurodollar funding, lending
or  liabilities  (or,  if more than one percentage  shall  be  so
applicable, the daily average of such percentage for  those  days
in  such  period  during  which  any  such  percentage  shall  be
applicable)  plus (B) the then daily net annual  assessment  rate
(rounded  upwards, if necessary, to the nearest 1/100 of  1%)  as
estimated  by  the  Agent  for  determining  the  current  annual
assessment payable by the Agent to the Federal Deposit  Insurance
Corporation  in  respect of eurocurrency or  eurodollar  funding,
lending or liabilities.

               "Adjustment  Payment" has the meaning assigned  to
that term in Section 2.9(a).

               "Administrative Fee" means the fee payable by  the
Transferor  to  the Company pursuant to Section 2.7  hereof,  the
terms of which are set forth in the Fee Letter.

               "Adverse  Claim" means a lien, security  interest,
charge  or encumbrance, or other right or claim in, of or on  any
Person's  assets  or  properties in favor  of  any  other  Person
(including  any UCC financing statement or any similar instrument
filed against such Person's assets or properties), excluding  any
liens  created  under this Agreement or the Receivables  Purchase
Agreements  or liens against the Initial Purchaser or the  Seller
that  secure  the payment of taxes, assessments and  governmental
charges or levies, if such taxes are either (a) not delinquent or
(b)  being  contested  in  good faith  by  appropriate  legal  or
administrative proceedings and as to which adequate  reserves  in
accordance  with  generally accepted accounting principles  shall
have been established.

               "Affected Assets" means, collectively, the
Receivables and the Collections and Proceeds relating thereto.

               "Affiliate" means, with respect to any Person, any
other  Person directly or indirectly controlling, controlled  by,
or under direct or indirect common control with, such Person.   A
Person  shall  be  deemed  to  control  another  Person  if   the
controlling Person possesses, directly or indirectly,  the  power
to direct or cause the direction of the management or policies of
the controlled Person, whether through ownership of voting stock,
by contract or otherwise.

               "Agent"  means NationsBank, N.A., in its  capacity
as  agent  for  the  Company  and the  Bank  Investors,  and  any
successor thereto appointed pursuant to Article IX.

               "Aggregate Interest Component" means aggregate sum
of  the Interest Components of all issued and outstanding Related
Commercial Paper.

               "Aggregate Unpaids" means, at any time, an  amount
equal to the sum of (i) the aggregate accrued and unpaid Carrying
Costs at such time, (ii) all amounts of the type included in  the
definition  of Carrying Costs which will accrue after such  time,
(iii) the Net Investment at such time, and (iv) all other amounts
owed (whether due or accrued) hereunder by the Transferor to  the
Company, the Agent or any Bank Investor at such time.

               "Agreement  Fee"  means the  fee  payable  by  the
Transferor  to  the  Agent pursuant to Section  4.1  hereof,  the
terms of which are set forth in the Fee Letter.

               "Assignment  Amount"  with  respect  to   a   Bank
Investor shall mean at any time an amount equal to the lesser  of
(i) such Bank Investor's Pro Rata Share of the Net Investment  at
such time and (ii) such Bank Investor's unused Commitment.

               "Assignment  and  Assumption Agreement"  means  an
Assignment and Assumption Agreement substantially in the form  of
Exhibit B attached hereto.

               "Bank Investors" shall mean NationsBank, N.A.  and
each  other  financial institution that becomes a  Bank  Investor
pursuant  to  an  Assignment  and Assumption  Agreement  and  the
respective  successors  and  permitted  assigns  of  any  of  the
foregoing.

               "Bankruptcy Code" has the meaning assigned to that
term in Section 3.1(k) hereof.

               "Base  Rate" or "BR" means, a rate per annum equal
to the greater of (i) the prime rate of interest announced by the
Liquidity Provider (or, if more than one Liquidity Provider, then
by  NationsBank)  from time to time, changing when  and  as  said
prime rate changes (such rate not necessarily being the lowest or
best  rate charged by the Liquidity Provider (or NationsBank,  as
applicable) and (ii) the sum of (a) 1.50% and (b) the rate  equal
to  the weighted average of the rates on overnight Federal  funds
transactions with members of the Federal Reserve System  arranged
by  Federal funds brokers, as published for such day (or, if such
day  is not a Business Day, for the next preceding Business  Day)
by  the Federal Reserve Bank of New York, or, if such rate is not
so  published for any day that is a Business Day, the average  of
the quotations for such day for such transactions received by the
Liquidity Provider (or, if more than one Liquidity Provider, then
by  NationsBank) from three Federal funds brokers  of  recognized
standing selected by it.

               "Benefit Plan" means any employee benefit plan  as
defined  in  Section  3(3)  of ERISA  in  respect  of  which  the
Transferor,  the  Initial  Purchaser, the  Seller  or  any  ERISA
Affiliate of the Transferor, the Initial Purchaser, or the Seller
is,  or  at  any time during the immediately preceding six  years
was, an "employer" as defined in Section 3(5) of ERISA.

               "Business  Day" means any day excluding  Saturday,
Sunday  and  any  day  on  which banks in  New  York,  New  York,
Charlotte,  North  Carolina or in the States of Minnesota,  Utah,
Missouri,  Illinois,  Nebraska  or  Oklahoma  are  authorized  or
required  by  law to close, and, when used with  respect  to  the
determination  of  any Adjusted LIBOR Rate  or  any  notice  with
respect thereto, any such day which is also a day for trading  by
and  between banks in United States dollar deposits in the London
interbank market.

               "Buyer's  Percentage  Factor"  shall  mean,   with
respect  to any Collection Period, the fraction (expressed  as  a
percentage) computed at any time of determination as follows:

                         NI
                         PRB

               
Where:

          NI = the Net Investment at the time of such
computation.

          PRB = the amount of Principal Receivables plus the
amount on deposit in the Excess Funding Account at the time of
such computation.

               
               Notwithstanding the foregoing computation, (i) the
Buyer's  Percentage Factor shall not exceed 100%,  and  (ii)  the
Buyer's  Percentage Factor with respect to Principal  Collections
at  any  time  on  and after the Termination Date  shall  be  the
percentage equivalent of a fraction the numerator of which is the
Net Investment as of the Termination Date and the denominator  of
which  is  the lesser of (x) the Principal Receivables  plus  the
amount  on deposit in the Excess Funding Account on the last  day
of  the  Collection Period immediately prior to  the  Termination
Date  or (y) the Principal Receivables plus the amount on deposit
in  the Excess Funding Account on the last day of the immediately
preceding Collection Period.

               "Carrying  Costs"  means, for a Collection  Period
the  sum  of  (i) the sum of the dollar amount of  the  Company's
obligations for such Collection Period determined on  an  accrual
basis  in  accordance with GAAP consistently applied (a)  to  pay
interest  with  respect to Purchased Interests  pursuant  to  the
provisions of the Liquidity Provider Agreement (such interest  to
be  calculated based on the Adjusted LIBOR Rate, provided that if
a  Termination Event (other than those specified in clause (k) or
(l)  of Section 7.1) shall have occurred, such interest shall  be
calculated at the Base Rate plus 2.00%) outstanding at  any  time
during  such Collection Period accrued from the first day through
the  last  day  of  such Collection Period whether  or  not  such
interest  is  payable during such Collection Period  and  to  pay
interest  with  respect to amounts disbursed by a Credit  Support
Provider pursuant to the Credit Support Agreement outstanding  at
any time during such Collection Period accrued from the first day
through  the  last day of such Collection Period whether  or  not
such  interest is payable during such Collection Period,  (b)  to
pay  the  Accrued Interest Component of Related Commercial  Paper
with  respect to any Collection Period (and, for purposes of this
clause  (b),  Related Commercial Paper shall  include  Commercial
Paper  issued to fund the Net Investment even if such  Commercial
Paper  is  issued in an amount in excess of the Net  Investment),
(c)  to  pay  the  Dealer Fee with respect to Related  Commercial
Paper  issued during such Collection Period, (d) to pay any  past
due interest not paid in clause (a) and (b) with respect to prior
Collection Periods, and (e) to pay the costs of the Company  with
respect  to the operation of Sections 8.1, 8.2, 8.3 and 8.4,  and
(ii) the Program Fee, the Administrative Fee and the Facility Fee
accrued  from  the  first  day  through  the  last  day  of  such
Collection  Period whether or not such amount is  payable  during
such  Collection Period, and all interest amounts  due  the  Bank
Investors in accordance with Section 2.3(c), (d) and (e).

               "Certificate" means the certificate issued to  the
Agent  for  the  benefit of the Company and  the  Bank  Investors
pursuant to Section 2.2(g) hereof.

               "Closing Date" means October 23, 1997.

               "Code" means the Internal Revenue Code of 1986, as
amended and in effect from time to time.

               "Collateral  Agent"  means NationsBank,  N.A.,  as
collateral  agent for any Liquidity Provider, any Credit  Support
Provider,  the  holders  of Commercial Paper  and  certain  other
parties.

               "Collection   Account"      means   the   account,
established by the Agent, for the benefit of the Company and  the
Bank Investors, pursuant to Section 2.12(a) hereof.

               "Collection  Agent" means at any time  the  Person
then  authorized  pursuant  to Section  6.1  hereof  to  service,
administer and collect Receivables.

               "Collection   Agent  Default"  has   the   meaning
specified in Section 6.4 hereof.

               "Collection  Period"  means  the  calendar   month
preceding  the  Remittance Date, or in  the  case  of  the  first
Collection Period, the period commencing on the Cut-Off  Date  to
the  end  of  the  calendar month preceding the first  Remittance
Date.

               "Collections"   means,   with   respect   to   any
Receivable, all cash collections and other cash proceeds of  such
Receivable,  including, without limitation,  all  Recoveries  and
collections  on  Finance Charge Receivables,  if  any,  and  cash
proceeds with respect to such Receivable.

               "Commercial  Paper"  means  the  promissory  notes
issued by the Company in the commercial paper market.

               "Commitment" means (i) with respect to  each  Bank
Investor  party hereto, the commitment of such Bank  Investor  to
make   acquisitions  from  the  Transferor  or  the  Company   in
accordance herewith in an amount not to exceed the dollar  amount
set   forth  opposite  such  Bank  Investor's  signature  on  the
signature  page hereto under the heading "Commitment", minus  the
dollar  amount  of  any  Commitment or portion  thereof  assigned
pursuant  to  an  Assignment and Assumption  Agreement  plus  the
dollar  amount of any increase to such Bank Investor's Commitment
consented  to  by  such  Bank  Investor  prior  to  the  time  of
determination,  (ii)  with respect to  any  assignee  of  a  Bank
Investor  party  hereto  taking pursuant  to  an  Assignment  and
Assumption  Agreement, the commitment of such  assignee  to  make
acquisitions from the Transferor or the Company not to exceed the
amount  set  forth  in  such Assignment and Assumption  Agreement
minus  the  dollar  amount of any Commitment or  portion  thereof
assigned pursuant to an Assignment and Assumption Agreement prior
to  such  time  of determination and (iii) with  respect  to  any
assignee  of  an  assignee  referred  to  in  clause  (ii),   the
commitment  of  such  assignee  to  make  acquisitions  from  the
Transferor or the Company not to exceed the amount set  forth  in
an  Assignment and Assumption Agreement between such assignee and
its assign.

               "Commitment  Termination Date" means  October  22,
1998, or such later date to which the Commitment Termination Date
may  be  extended  by  the Transferor, the  Agent  and  the  Bank
Investors  not  later  than 60 days prior  to  the  then  current
Commitment Termination Date.

               "Company" means Kitty Hawk Funding Corporation and
its successors and assigns.

               "Credit  and Collection Policy" means the  written
policies  and procedures of the Seller relating to the  operation
of  its  consumer  revolving  credit  card  business,  including,
without  limitation,  the  written policies  and  procedures  for
determining  the creditworthiness of credit card  customers,  the
extension of credit to credit card customers and relating to  the
maintenance of credit card accounts and collection of receivables
with  respect  thereto,  as  such  policies  and  procedures  are
amended, modified or otherwise changed from time to time.

               "Credit  Support  Agreement" means  the  agreement
between  the  Company and the Credit Support Provider  evidencing
the  obligation of the Credit Support Provider to provide  credit
support  to  the Company in connection with the issuance  by  the
Company of Commercial Paper.

               "Credit  Support  Provider" means  the  Person  or
Persons  who provides credit support to the Company in connection
with the issuance by the Company of Commercial Paper.

               "Cut-Off Date" means October 10, 1997.

               "Date  of Processing" means, with respect  to  any
transaction giving rise to a Receivable, the date on  which  such
transaction  is  settled  according  to  the  Collection  Agent's
computer master file of Accounts.

               "Dealer  Fee"  means  the  fee  payable   by   the
Transferor  to the Company, pursuant to Section 2.5  hereof,  the
terms of which are set forth in the Fee Letter.

                "Default Ratio" means, for any Collection Period,
the  ratio (expressed as a percentage) the numerator of which  is
the  product  of  (i) 12 and (ii) the aggregate  balance  of  all
Eligible  Receivables which became Defaulted  Receivables  during
such  Collection  Period  and the denominator  of  which  is  the
average  outstanding balance of all Eligible  Receivables  during
such Collection Period.

               "Defaulted  Receivable" means a Receivable  in  an
Account with respect to which, in accordance with the Credit  and
Collection Policy or the Collection Agent's customary  and  usual
servicing procedures, the Collection Agent has charged  off  such
Receivable  as  uncollectible;  a  Receivable  shall   become   a
Defaulted  Receivable  on  the day on which  it  is  recorded  as
charged  off as uncollectible on the Collection Agent's  computer
master   file   of  consumer  credit  card  revolving   accounts.
Notwithstanding  any  other  provision  hereof,   any   Defaulted
Receivables that are not Eligible Receivables shall be treated as
Receivables  which are not Eligible Receivables  rather  than  as
Defaulted Receivables.

               "Determination  Date" shall mean with  respect  to
any Collection Period, the date which is two Business Days before
the related Remittance Date.

               "Discount   Percentage"   means   the   Percentage
designated by the Transferor pursuant to Section 2.5(e).

               "Discount  Receivables"  shall  have  the  meaning
specified in Section 2.5(e).

               "Discount Receivables Collections" means, for  any
day, the product of (a) the Discount Percentage and (b) Principal
Collections   (without  giving  effect  to  Discount  Receivables
Collections) on such day.

               "DMCCB"  means Direct Merchants Credit Card  Bank,
National Association, a national banking association.

               "Early  Collection  Fee" means,  for  any  funding
period  during which the portion of the Net Investment  that  was
allocated  to  such  funding period is  reduced  for  any  reason
whatsoever,  the  excess, if any, of (i) the additional  interest
that  would  have  accrued during such  funding  period  if  such
reductions  had  not  occurred, minus (ii) the  income,  if  any,
received  by the recipient of such reductions from investing  the
proceeds of such reductions.

               "Eligible  Account" means, as of the Cut-Off  Date
(or, with respect to Accounts arising after the Cut-Off Date,  as
of  the date of creation), each Account in existence and owned by
the Seller:

                    (i)  the credit card or cards related thereto have not been
          reported lost or stolen or designated fraudulent;
          
                    (ii) the Obligor on which has provided, as its most recent
          billing address, an address located in the United States or its
          territories or possessions, or Canada, or which is a United
          States military address;
          
                    (iii)     which is not an Account as to which any of the
          Receivables existing thereunder are Defaulted Receivables; and
          
                    (iv) which was purchased by the Seller from Mercantile 
          (or is a Related Account) and to which the Seller has good title, 
          free and clear of all Adverse Claims;
          
               "Eligible  Investments" means any of the following
(a)   negotiable   instruments  or  securities   represented   by
instruments in bearer or registered or in book-entry  form  which
evidence (i) obligations fully guaranteed by the United States of
America; (ii) time deposits in, or bankers acceptances issued by,
any  depositary  institution or trust company incorporated  under
the laws of the United States of America or any state thereof and
subject  to  supervision  and examination  by  Federal  or  state
banking or depositary institution authorities; provided, however,
that  at  the  time  of investment or contractual  commitment  to
invest   therein,  the  certificates  of  deposit  or  short-term
deposits, if any, or long-term unsecured debt obligations  (other
than  such obligation whose rating is based on collateral  or  on
the  credit  of  a  Person other than such institution  or  trust
company)  of  such depository institution or trust company  shall
have  a credit rating from Moody's and S&P of at least "P-1"  and
"A-1",  respectively, in the case of the certificates of  deposit
or short-term deposits, or a rating not lower than one of the two
highest  investment  categories granted by Moody's  and  by  S&P;
(iii)  certificates of deposit having, at the time of  investment
or  contractual  commitment  to invest  therein,  a  rating  from
Moody's  and  S&P  of at least "P-1" and "A-1", respectively;  or
(iv)  investments  in  money market funds rated  in  the  highest
investment  category  or otherwise approved  in  writing  by  the
applicable rating agencies; (b) demand deposits in any depositary
institution  or trust company referred to in (a)(ii)  above;  (c)
commercial paper (having original or remaining maturities  of  no
more  than  30  days)  having,  at  the  time  of  investment  or
contractual  commitment to invest therein, a credit  rating  from
Moody's  and  S&P of at least "P-1" and "A-1", respectively;  (d)
Eurodollar time deposits having a credit rating from Moody's  and
S&P of at least "P-1" and "A-1", respectively; and (e) repurchase
agreements involving any of the Eligible Investments described in
clauses  (a)(i),  (a)(iii) and (d) hereof so long  as  the  other
party  to  the repurchase agreement has at the time of investment
therein, a rating from Moody's and S&P of at least "P-1" and  "A-
1", respectively.

               "Eligible  Receivable" means,  at  any  time,  any
Receivable:

                (i)  with respect to which the related Account is
an Eligible Account;

                (ii)       to  which, immediately  prior  to  the
transfer  to the Company, the Transferor has good title  thereto,
free and clear of all Adverse Claims;

                (iii)      which  (together with the  Collections
related  thereto) has been the subject of either a valid transfer
and  sale  from  the Transferor to the Agent, on  behalf  of  the
Company and the Bank Investors, of all of the Transferor's right,
title  and  interest  therein or the grant of  a  first  priority
perfected  security  interest therein  (and  in  the  Collections
related  thereto),  effective  until  the  termination  of   this
Agreement;

               (iv) the Obligor of which is not a government or a
government subdivision or agency;

                (v)   which is not a Defaulted Receivable at  the
time of the initial creation of an interest therein hereunder;

                (vi)  which is an "eligible asset" as defined  in
Rule 3a-7 under the Investment Company Act of 1940, as amended;

               (vii)     a purchase of which with the proceeds of
Commercial Paper would constitute a "current transaction"  within
the meaning of Section 3(a)(3) of the Securities Act of 1933,  as
amended;

                (viii)    which is an "account," "chattel  paper"
or  "general intangible" within the meaning of Article 9  of  the
UCC of the applicable jurisdiction;

                (ix)  which  is denominated and payable  only  in
United States dollars;

                (x)  which arises under an Account that, together
with  the Receivable related thereto, is in full force and effect
and  constitutes the legal, valid and binding obligation  of  the
related  Obligor enforceable against such Obligor  in  accordance
with  its  terms  and is not, at the time of transfer  hereunder,
subject  to any litigation, right of recission, dispute,  offset,
counterclaim or other defense;

                (xi)  which,  together with the  Account  related
thereto,  complies in all material respects with all laws,  rules
or regulations applicable thereto (including, without limitation,
laws,  rules  and regulations relating to truth in lending,  fair
credit  billing, fair credit reporting, equal credit opportunity,
fair  debt collection practices and privacy) and with respect  to
which  the  Account Agreement related thereto is not in violation
of any such law, rule or regulation in any material respect;

                (xii)     which is assignable without the consent
of, or notice to, the Obligor thereunder;

                 (xiii)     the  transfer  of  which  under   the
Receivables  Purchase Agreements by the Seller  and  the  Initial
Purchaser  and  hereunder  by the Transferor  does  not  violate,
breach  or  contravene any applicable laws,  rules,  regulations,
orders   or  writs  or  any  contractual  or  other  restriction,
limitation or encumbrance;

                 (xiv)       which,  at  the  time  of   transfer
hereunder,  has  not  been  compromised,  adjusted  or   modified
(including the granting of any discounts, allowances or credits);
provided, however, that only such portion of such Receivable that
is  the  subject  of such compromise, adjustment or  modification
shall  be deemed to be ineligible pursuant to the terms  of  this
clause (xiv);

                (xv) as to which no effective financing statement
or  other  instrument similar in effect covering such Receivable,
any interest therein, Account or Collections with respect thereto
is on file in any recording office except such as may be filed in
favor of the Initial Purchaser or the Transferor, pursuant to the
Receivables Purchase Agreements, or the Company hereunder; and

                (xvi)      with  respect to  which  all  material
consents,   licenses,   approvals  or   authorizations   of,   or
registrations  or  declarations with, any governmental  authority
required  to  be  obtained, effected  or  given  by  the  Initial
Purchaser,  Transferor  or  the Seller  in  connection  with  the
creation  of such Receivable or the execution, delivery, creation
and  performance  by  the Initial Purchaser,  Transferor  or  the
Seller of the Account Agreement pursuant to which such Receivable
was  created, have been duly obtained, effected or given and  are
in full force and effect.

               "ERISA" means the U.S. Employee Retirement  Income
Security  Act  of  1974, as amended from time to  time,  and  the
regulations promulgated and rulings issued thereunder.

               "ERISA  Affiliate"  means,  with  respect  to  any
Person,  (i)  any  corporation which is  a  member  of  the  same
controlled  group of corporations (within the meaning of  Section
414(b)  of  the  Code) as such Person; (ii) a trade  or  business
(whether  or  not incorporated) under common control (within  the
meaning of Section 414(c) of the Code) with such Person; or (iii)
a member of the same affiliated service group (within the meaning
of  Section  414(n) of the Code) as such Person, any  corporation
described  in clause (i) above or any trade or business described
in clause (ii) above; provided, however, that none of FCI and its
Affiliates   (other   than   the  Initial   Purchaser   and   its
Subsidiaries) shall be an ERISA Affiliate.

               "Event  of Bankruptcy" means, with respect to  any
Person,  (i)  that such Person (a) shall generally  not  pay  its
debts as such debts become due or (b) shall admit in writing  its
inability to pay its debts generally or (c) shall make a  general
assignment  for  the  benefit of creditors; (ii)  any  proceeding
shall  be  instituted  by  or  against  such  Person  seeking  to
adjudicate  it as bankrupt or insolvent, or seeking  liquidation,
winding  up, reorganization, arrangement, adjustment, protection,
relief  or composition of it or its debts under any law  relating
to bankruptcy, insolvency or reorganization or relief of debtors,
or seeking the entry of an order for relief or the appointment of
a  receiver,  trustee or other similar official  for  it  or  any
substantial  part of its property; or (iii) if such Person  is  a
corporation,  such  Person  or  any  Subsidiary  shall  take  any
corporate action to authorize any of the actions set forth in the
preceding clauses (i) or (ii).

               "Excess  Funding Account" shall have  the  meaning
assigned to that term in Section 2.12(c).

               "Excluded  Taxes" shall have the meaning specified
in Section 8.3 hereof.

               "Facility  Fee"  means  the  fee  payable  by  the
Transferor  to  the Agent for distribution to the Bank  Investors
pursuant to Section 2.7 hereof, the terms of which are set  forth
in the Fee Letter.

               "Facility Limit" means $450,000,000.

               "FCI" means Fingerhut Companies, Inc., a Minnesota
corporation.

               "Fee Letter" means the letter agreement dated  the
date  hereof between the Transferor and the Company with  respect
to  the  fees to be paid by the Transferor hereunder, as amended,
modified or supplemented from time to time.

               "Finance  Charge  Collections"  shall  mean,  with
respect  to  any  Business  Day,  Collections  received  by   the
Collection  Agent with respect to Finance Charge  Receivables  on
such Business Day.

               "Finance Charge Receivables" shall mean the sum of
(w)  all amounts billed from time to time to the Obligors on  any
Account  in  respect of (i) Periodic Finance Charges,  (ii)  over
limit  fees,  (iii) late charges, (iv) returned check  fees,  (v)
annual  membership fees and annual service charges, if any,  (vi)
transaction  charges, (vii) cash advance fees and (viii)  similar
fees  and  charges, excluding fees and charges for insurance  and
insurance  type  products, plus (x) Recoveries and  (y)  Discount
Receivables, if any.

               "GAAP"   means   generally   accepted   accounting
principles  set forth in the opinions and pronouncements  of  the
Accounting   Principles  Board  of  the  American  Institute   of
Certified Public Accountants and statements and pronouncements of
the  Financial  Accounting  Standards  Board  or  in  such  other
statements  by  such accounting profession, which are  in  effect
from time to time.

               "Incremental Transfer" means a Transfer  which  is
made pursuant to Section 2.2(a) hereof.

               "Indemnified Amounts" has the meaning specified in
Section 8.1 hereof.

               "Indemnified Parties" has the meaning specified in
Section 8.1 hereof.

               "Initial Purchaser" means Metris Companies,  Inc.,
a Delaware corporation, and its successors and permitted assigns.

               "Interest  Component" means, (i) with  respect  to
any  Commercial  Paper issued on an interest-bearing  basis,  the
interest  payable  on  such  Commercial  Paper  at  its  maturity
(including any dealer commissions) and (ii) with respect  to  any
Commercial Paper issued on a discount basis, the portion  of  the
face  amount  of such Commercial Paper representing the  discount
incurred in respect thereof (including any dealer commissions  to
the extent included as part of such discount).

               "Investor Report" means a report, in substantially
the form attached hereto as Exhibit D or in such other form as is
mutually agreed to by the Transferor and the Agent, furnished  by
the Collection Agent pursuant to Section 2.11 hereof.

               "Law"   means  any  law  (including  common  law),
constitution,  statute,  treaty,  regulation,  rule,   ordinance,
order, injunction, writ, decree or award of any Official Body.

               "LIBOR Rate" means, with respect to any Collection
Period, the rate per annum (rounded upwards, if necessary, to the
nearest  1/100  of 1%) appearing on telerate Page  3750  (or  any
successor page) as the London interbank offered rate for deposits
in  U.S.  dollars at approximately 11:00 a.m. (London  time)  two
London  Business  Days prior to the first day of such  Collection
Period  for a term of one month.  If for any reason such rate  is
not  available,  the  term  "LIBOR  Rate"  shall  mean,  for  any
Collection  Period,  the  rate per  annum  (rounded  upwards,  if
necessary,  to  the  nearest 1/100 of 1%)  appearing  on  Reuters
Screen  LIBO  Page  as  the  London interbank  offered  rate  for
deposits in dollars at approximately 11:00 a.m. (London time) two
London  Business  Days prior to the first day of such  Collection
Period  for  a term of one; provided, however, if more  than  one
rate is specified on the Reuters Screen LIBO Page, the applicable
rate shall be the arithmetic mean of all such rates.

               "Liquidity  Provider" means the Person or  Persons
who  will  provide liquidity support to the Company in connection
with the issuance by the Company of Commercial Paper.

               "Liquidity Provider Agreement" means the agreement
between  the  Company and the Liquidity Provider  evidencing  the
obligation of the Liquidity Provider to provide liquidity support
to  the Company in connection with the issuance by the Company of
Commercial Paper.

               "Majority   Investors"  shall  have  the   meaning
specified in Section 9.1(a) hereof.

               "Material  Adverse  Effect"  means  any  event  or
condition  which could reasonably be expected to have a  material
adverse  effect  on  (i) the collectibility of  the  Receivables,
taken  as  a  whole, (ii) the condition (financial or otherwise),
businesses or properties of the Transferor, the Initial Purchaser
or  the  Seller, (iii) the ability of the Transferor, the Initial
Purchaser  or  the Seller  to perform its respective  obligations
under  the Transaction Documents to which it is a party and  (iv)
the  interests  of the Agent, the Company or the  Bank  Investors
under the Transaction Documents.

               "Maximum Buyer's Percentage Factor" means 82%.

               "Mercantile"   means  Mercantile   Bank   National
Association,  a  national banking association  and  successor  to
Mercantile  Bank  of  Illinois  National  Association  and  shall
include,  with  respect to the origination  or  creation  of  any
Account   sold   pursuant  to  the  Mercantile   Agreement,   any
predecessor  in interest to Mercantile which actually  originated
such Account.

               "Mercantile   Agreement"   means   the    Purchase
Agreement,  dated  as  of  September 25,  1997,  by  and  between
Mercantile  and  DMCCB,  as  it  may  be  modified,  amended  and
supplemented from time to time.

               "Minimum Transferor's Interest" means the amount
computed at any time of determination as follows:
                                
                         NI     -  NI
                         82%
               
Where:

          NI = the Net Investment at the time of such
computation.

               "Moody's" means Moody's Investors Service, Inc.

               "Multiemployer Plan" means a "multi-employer plan"
as  defined in Section 4001(a)(3) of ERISA which is or was at any
time  during  the current year or the immediately preceding  five
years contributed to by the Transferor, the Initial Purchaser the
Seller or any ERISA Affiliate of the Transferor or the Seller  on
behalf of its employees.

               "Net  Asset  Test" means, in connection  with  any
assignment by the Company to the Bank Investors of an interest in
the  Net Investment pursuant to Section 9.7 hereof, that  on  the
day  immediately prior to the day on which such assignment is  to
take  effect, the Principal Receivables shall be greater than  or
equal to the Net Investment.

               "Net Investment" means the sum of the cash amounts
paid  to  the Transferor for each Incremental Transfer  less  the
aggregate amount of Collections received and applied by the Agent
to reduce such Net Investment pursuant to Section 2.5, 2.6 or 2.9
hereof;  provided,  however, that the  Net  Investment  shall  be
restored  and  reinstated in the amount  of  any  Collections  so
received  and  applied  if at any time the distribution  of  such
Collections  is rescinded or must otherwise be returned  for  any
reason;  and, provided, further, that the Net Investment  may  be
increased  by  the amount described in Section 9.7(d)  hereof  as
described therein.

               "Net  Portfolio Yield" means, with respect to  any
Collection  Period,  the annualized percentage  equivalent  of  a
fraction  the  numerator  of  which  is  equal  to  the   Buyer's
Percentage  Factor  of  Finance  Charge  Collections   for   such
Collection  Period minus the Carrying Costs for  such  Collection
Period  minus  the  Buyer's Percentage Factor of  the  amount  of
Receivables  which  became  Defaulted  Receivables  during   such
Collection  Period  minus the Buyer's Percentage  Factor  of  the
Servicing  Fee  with respect to such Collection  Period  and  the
denominator of which is equal to  the average Net Investment  for
such Collection Period.

               "Obligor"  means  a  Person  obligated   to   make
payments   pursuant  to  an  Account,  including  any   guarantor
thereunder.

               "Official  Body" means any government or political
subdivision  or  any  agency, authority,  bureau,  central  bank,
commission, department or instrumentality of any such  government
or  political subdivision, or any court, tribunal, grand jury  or
arbitrator, in each case whether foreign or domestic.

               "Other Transferor" means any Person other than the
Transferor that has entered into a receivables purchase agreement
or transfer and administration agreement with the Company.

               "Payment  Rate" means, for any Collection  Period,
the  percentage equivalent of a fraction, the numerator of  which
is  equal  to  the  amount  of all cash Collections  during  such
Collection  Period and the denominator of which is equal  to  the
average  amount  of  Receivables  outstanding  during  the  prior
Collection Period.

               "Periodic   Finance  Charges"  shall  have,   with
respect  to  any  Account, the meaning specified in  the  Account
Agreement applicable to such Account for finance charges (due  to
periodic rate) or any similar term.

               "Person"  means any corporation, limited liability
company, natural person, firm, joint venture, partnership, trust,
unincorporated  organization,  enterprise,  government   or   any
department or agency of any government.

               "Potential Termination Event" means an event which
but for the lapse of time or the giving of notice, or both, would
constitute a Termination Event.

               "Principal Collections" means, with respect to any
Collection  Period, all Collections received during  such  period
other than Finance Charge Collections.

               "Principal Receivables" means amounts shown on the
Collection  Agent's records as amounts payable by  Obligors  with
respect  to Eligible Receivables on any Account other  than  such
amounts  that are Finance Charge Receivables (including  Discount
Receivables) or Defaulted Receivables and shall include,  without
limitation, amounts payable for purchases of goods or services or
cash  advances. A Receivable shall be deemed to have been created
at  the  end  of  the  day  on the Date  of  Processing  of  such
Receivable.  In  calculating the aggregate  amount  of  Principal
Receivables on any day, the amount of Principal Receivables shall
be  reduced  by  the aggregate amount of credit balances  in  the
Accounts on such day.

               "Pro  Rata Share" means, for a Bank Investor,  the
Commitment  of  such Bank Investor divided  by  the  sum  of  the
Commitments of all Bank Investors.

               "Proceeds" means "proceeds" as defined in  Section
9-306(1) of the UCC.

               "Program  Fee"  means  the  fee  payable  by   the
Transferor  to  the Company pursuant to Section 2.7  hereof,  the
terms of which are set forth in the Fee Letter.

               "Purchased  Interest" means the  interest  in  the
Receivables  acquired by the Liquidity Provider through  purchase
pursuant to the terms of the Liquidity Provider Agreement.

               "Purchase  Termination Date" means the  date  upon
which  the  Transferor or the Initial Purchaser shall cease,  for
any reason whatsoever, to make purchases of Receivables under the
applicable  Receivables Purchase Agreement or either  Receivables
Purchase Agreement shall terminate for any reason whatsoever.

               "Receivable" means all of the indebtedness of  any
Obligor  to the Transferor under an Account, including the  right
to  receive payment of any interest or finance charges and  other
obligations   of  such  Obligor  with  respect   thereto.    Each
Receivable  includes,  without  limitation,  all  rights  of  the
Transferor under the applicable Account Agreement.

               "Receivables    Purchase    Agreements"     means,
collectively,  the  (a)  Amended and  Restated  Bank  Receivables
Purchase Agreement, dated as of May 26, 1995, between the Seller,
as  seller, and FCI, as buyer, which was assigned by FCI  to  the
Initial  Purchaser  pursuant  to the  Assignment  and  Assumption
Agreement, dated as of September 16, 1996, among FCI, the Initial
Purchaser  and the Seller, and (b) the Purchase Agreement,  dated
as  of the date hereof, by and between the Initial Purchaser,  as
seller, and the Transferor, as purchaser, as such agreements  may
be  amended, modified or supplemented and in effect from time  to
time.

               "Records"  means all right, title and interest  of
the  Seller, the Initial Purchaser and the Transferor in  and  to
all  Account  Agreements and other documents, books, records  and
other   information  (including,  without  limitation,   computer
programs, tapes, discs, punch cards, data processing software and
related   property  and  rights)  maintained  with   respect   to
Receivables and the related Obligors.

               "Recoveries"   means  all  amounts   received   or
collected  by  the  Collection Agent with  respect  to  Defaulted
Receivables.

               "Reinvestment Termination Date" means  the  second
Business  Day after the delivery by the Company to the Transferor
of  written  notice  that the Company elects to  assign  the  Net
Investment to the Bank Investors pursuant to Section 9.7.

               "Related Account" shall mean an Account having the
following   characteristics:   (i)  such  Related   Account   was
originated  in accordance with the Credit and Collection  Policy;
(ii) the Obligor or Obligors with respect to such Related Account
is  the same Person or Persons as the Obligor or Obligors  of  an
Account; (iii) such Related Account is originated as a result  of
the  credit  card with respect thereto being lost or stolen;  and
(iv)  such  Related  Account can be traced  or  identified  as  a
successor account to an Account by reference to or by way of  the
computer  or  other  records  of  the  Collection  Agent  or  the
Transferor.

               "Related  Commercial Paper" shall mean  Commercial
Paper  issued by the Company the proceeds of which were  used  to
acquire,  or  refinance  the  acquisition  of,  an  interest   in
Receivables with respect to the Transferor.

               "Remittance Date" means the twentieth day of  each
calendar  month, or if such day is not a Business Day,  the  next
succeeding  Business  Day;  provided,  however,  that  the  first
Remittance Date shall be December 22, 1997.

               "Section  8.2 Costs" has the meaning specified  in
Section 8.2(d) hereof.

               "Seller"  means  DMCCB  and  its  successors   and
permitted assigns.

               "Servicing  Fee"   means the fee  payable  to  the
Collection  Agent  in  an amount equal to 2%  per  annum  on  the
average  daily  amount  of the Principal Receivables.   Such  fee
shall accrue from the date of the initial purchase of an interest
in  the  Receivables to the date on which the Buyer's  Percentage
Factor  is reduced to zero.  Such fee shall be payable only  from
Collections pursuant to, and subject to the priority of  payments
set forth in, Section 2.5 hereof.

               "Spread Account" means the account established  by
the Agent, for the benefit of the Company and the Bank Investors,
pursuant to Section 2.12(b) hereof.

               "Spread Account Cap Percentage Amount", as of  any
Remittance Date, means the product of the Net Investment on  such
Remittance   Date   and  the  applicable  "Spread   Account   Cap
Percentage"  determined  as set forth in  the  chart  immediately
below,  subject  to  the following:  (a) if the  average  Default
Ratio  for  any three consecutive Collection Periods  is  greater
than 17%, then the applicable Spread Account Cap Percentages  set
forth  below  shall each be increased by 2%; (b) any decrease  in
the  Spread  Account Cap Percentage will take effect  only  after
three consecutive Remittance Dates during which such decrease (or
any   greater  decrease)  shall  have  prevailed;  and  (c)   any
calculation  of  the  "Spread Account Percentage"  based  on  the
Collection  Periods  ending in September 1997  and  October  1997
shall  assume that, for each such Collection Period, (x) the  Net
Portfolio  Yield  was  4.91%  and 5.63%,  respectively,  (y)  the
Payment  Rate was 10.67% and 10.76%, respectively,  and  (z)  the
Default Ratio was 14.38% and 15.15%, respectively.

               The   Spread   Account   Cap   Percentage   Amount
applicable on the Closing Date shall be $0.

          
          
                                                       
Average Net Portfolio                                  
Yield for the three     Spread Account Cap    Spread Account Cap
consecutive Collection    Percentage(1)         Percentage(2)
Periods immediately                                    
preceding the
Remittance Date

                                               
Greater than 4.50%     0%                    1%
                                             
Greater than 4.00% and    1%                   2%
less than or equal to                        
4.50%

Greater than 3.00% and    2%                   3%
less than or equal to                        
4.00%

Greater than 2.00% and    3%                   4%
less than or equal to                        
3.00%

2.00% and less            4%                   5%
                                             
          
          (1)  Spread Account Cap Percentage in effect if average
Payment Rate for the three consecutive Collection Periods
immediately preceding the Remittance Date is greater than 10%.

          (2)  Spread Account Cap Percentage in effect if average
Payment Rate for the three consecutive Collection Periods
immediately preceding the Remittance Date is less than or equal
to 10%.

               "Standard  &  Poor's" or "S&P"  means  Standard  &
Poor's  Ratings  Services, a division of  McGraw-Hill  Companies,
Inc.

               "Subsidiary"  of  a Person means any  Person  more
than  50%  of the outstanding voting interests of which shall  at
any  time be owned or controlled, directly or indirectly, by such
Person  or  by  one or more Subsidiaries of such  Person  or  any
similar business organization which is so owned or controlled.

               "Taxes"  shall  have  the  meaning  specified   in
Section 8.3 hereof.

               "Termination Date" means the earliest of  (i)  the
Business  Day  designated by the Transferor to the Agent  as  the
Termination Date at any time following 60 days' written notice to
the  Agent, (ii) the date of termination of the commitment of the
Liquidity Provider under the Liquidity Provider Agreement,  (iii)
the  date of termination of the commitment of the Credit  Support
Provider  under the Credit Support Agreement, (iv) the  day  upon
which  the  Termination Date is declared or automatically  occurs
pursuant to Section 7.2(a) hereof, (v) two Business Days prior to
the  Commitment  Termination Date, (vi) the Purchase  Termination
Date or (vii) October 22, 1998.

               "Termination  Event" means an event  described  in
Section 7.1 hereof.

               "Transaction  Costs" has the meaning specified  in
Section 8.4(a) hereof.

               "Transaction Documents" means, collectively,  this
Agreement,  the Receivables Purchase Agreements, the Fee  Letter,
the  Certificate, the Transfer Certificate and all of  the  other
instruments,   documents  and  other  agreements   executed   and
delivered by the Seller or the Transferor in connection with  any
of  the  foregoing,  in each case, as the same  may  be  amended,
restated, supplemented or otherwise modified from time to time.

               "Transfer"   means  a  conveyance,  transfer   and
assignment by the Transferor to the Company or the Bank Investors
of  an  undivided  percentage ownership interest  in  Receivables
hereunder  (including, without limitation, as  a  result  of  any
reinvestment of Collections in Transferred Interests pursuant  to
Sections 2.2(e) and 2.5 hereof).

               "Transfer  Certificate" has the meaning  specified
in Section 2.2(c) hereof.

               "Transfer  Date"  means,  with  respect  to   each
Transfer, the Business Day on which such Transfer is made.

               "Transfer  Price"  means  with  respect   to   any
Incremental  Transfer, the amount paid to the Transferor  by  the
Company  or  the  Bank Investors as described in  the  applicable
Transfer Certificate.

               "Transferor" means Metris Funding Co., a  Delaware
corporation, and its successors and permitted assigns.

               "Transferor's Percentage Interest" means (i)  100%
(1) minus (ii) the Buyer's Percentage Factor.

               "Transferred  Interest"  means,  at  any  time  of
determination, an undivided percentage ownership interest in  (i)
each  and every then outstanding Receivable, (ii) all Collections
with  respect thereto, and (iii) other Proceeds of the foregoing,
which  undivided ownership interest shall be equal to the Buyer's
Percentage  Factor at such time, and only at such  time  (without
regard to prior calculations).  The Transferred Interest in  each
Receivable,  together with Collections and Proceeds with  respect
thereto,  shall at all times be equal to the Transferred Interest
in  each other Receivable, together with Collections and Proceeds
with  respect  thereto.   To  the  extent  that  the  Transferred
Interest  shall  decrease as a result of a recalculation  of  the
Buyer's Percentage Factor, the Agent, on behalf of the Company or
the  Bank Investors, as applicable, shall be considered  to  have
reconveyed  to  the Transferor an undivided percentage  ownership
interest  in  each  Receivable,  together  with  Collections  and
Proceeds  with  respect  thereto, in  an  amount  equal  to  such
decrease such that in each case the Transferred Interest in  each
Receivable  shall  be equal to the Transferred Interest  in  each
other Receivable.

               "UCC"  means,  with  respect  to  any  state,  the
Uniform  Commercial Code as from time to time in effect  in  such
state.

               "U.S."  or "United States" means the United States
of America.

          SECTION 1.2.     Other Terms.
          
               All  accounting  terms  not  specifically  defined
herein  shall  be construed in accordance with GAAP.   All  terms
used  in  Article 9 of the UCC in the State of New York, and  not
specifically defined herein, are used herein as defined  in  such
Article 9.

          SECTION 1.3.     Computation of Time Periods.
          
               Unless otherwise stated in this Agreement, in  the
computation of a period of time from a specified date to a  later
specified  date, the word "from" means "from and including",  the
words  "to"  and "until" each means "to but excluding",  and  the
word  "within" means "from and excluding a specified date and  to
and including a later specified date".

                                
                           ARTICLE I I
                                
                    PURCHASES AND SETTLEMENTS
                                
          SECTION 2.

          SECTION 2.1.     Facility.
          
               Upon  the  terms  and subject  to  the  conditions
herein  set forth at any time prior to the Termination  Date  (x)
the Transferor may, at its option, convey, transfer and assign to
the  Agent,  on  behalf of the Company or the Bank Investors,  as
applicable, and (y) the Agent, on behalf of the Company, may,  at
the  Company's  option,  or the Agent,  on  behalf  of  the  Bank
Investors,  shall accept such conveyance, transfer and assignment
from  the  Transferor  of, without recourse  except  as  provided
herein,   undivided  percentage  ownership   interests   in   the
Receivables, together with Collections and Proceeds with  respect
thereto,  from  time  to  time.   By  accepting  any  conveyance,
transfer and assignment hereunder, neither the Company, any  Bank
Investor  nor the Agent assumes or shall have any obligations  or
liability  under any of the Accounts, all of which  shall  remain
the  obligations and liabilities of the Transferor,  the  Initial
Purchaser and the Seller.

          SECTION 2.2.     Transfers; Certificates; Eligible Receivables.
          
          (a)  Upon the terms and subject to the conditions herein set
forth  the  Transferor may, at its option, convey,  transfer  and
assign  to  the  Agent,  on behalf of the  Company  or  the  Bank
Investors, as applicable, and the Agent, on behalf of the Company
may,  provided that the Termination Date shall not have occurred,
at  the  Company's option, or the Agent, on behalf  of  the  Bank
Investors,  provided  that the Termination Date  shall  not  have
occurred  and  that  the  Bank Investors  shall  have  previously
accepted the assignment by the Company of all of its interest  in
the  Affected  Assets, shall, if so requested by the  Transferor,
accept   such  conveyance,  transfer  and  assignment  from   the
Transferor,  without  recourse  except  as  provided  herein,  of
undivided  percentage  ownership interests  in  the  Receivables,
together  with  Collections  and Proceeds  with  respect  thereto
(each, an "Incremental Transfer"); provided, however, that  after
giving  effect to the payment to the Transferor of such  Transfer
Price  (x) the sum of the Net Investment plus, in the case  where
the  Transferred Interest is held by the Agent on behalf  of  the
Company,  the  Interest  Component  of  all  outstanding  Related
Commercial  Paper, would not exceed the Facility Limit;  and  (y)
the  Transferor's  Percentage Interest, when  multiplied  by  the
Principal  Receivables,  shall  not  be  less  than  the  Minimum
Transferor's   Interest;   and,  provided   further,   that   the
representations and warranties set forth in Sections 3.1 and  3.2
hereof  shall  be  true and correct both immediately  before  and
immediately after giving effect to any such Incremental  Transfer
and  the  payment to the Transferor of the Transfer Price related
thereto and an Additional Investment Certificate shall have  been
delivered  with respect to such Incremental Transfer as  required
by Section 2.11(b) hereof.

(b)  The Transferor shall, by notice to the Agent given by no
later than 11:00 a.m. (New York City time) at least one (1)
Business Day prior to the proposed date of any Incremental
Transfer by telecopy, offer to convey, transfer and assign to the
Agent, on behalf of the Company or the Bank Investors, as
applicable, undivided percentage ownership interests in the
Receivables and the other Affected Assets relating thereto.  Each
such notice shall specify (w) whether such request is made to the
Agent, on behalf of the Company or on behalf of the Bank
Investors (it being understood and agreed that once any
Transferred Interest hereunder is acquired on behalf of the Bank
Investors, the Agent, on behalf of Bank Investors, shall be
required to purchase all Transferred Interests held by the Agent
on behalf of the Company in accordance with Section 9.7 hereof
and thereafter that no additional Incremental Transfers shall be
acquired on behalf of the Company hereunder), (x) the desired
Transfer Price (which shall be at least $1,000,000 or integral
multiples of $250,000 in excess thereof) or, to the extent that
the then available unused portion of the Facility Limit is less
than such amount, such lesser amount equal to such available
portion of the Facility Limit), and (y) the desired date of such
Incremental Transfer.  The Agent will promptly notify the Company
or each of the Bank Investors, as the case may be, of the Agent's
receipt of any request for an Incremental Transfer to be made to
the Agent on behalf of such Person.  To the extent that any such
Incremental Transfer is requested of the Agent, on behalf of the
Company, the Company shall instruct the Agent to accept or reject
such offer by notice given to the Transferor and the Agent by
telephone or telecopy by no later than the close of its business
on the Business Day following its receipt of any such request.
Each notice of proposed Transfer shall be irrevocable and binding
on the Transferor and the Transferor shall indemnify the Company
and each Bank Investor against any loss or expense incurred by
the Company or any Bank Investor, either directly or indirectly
(including, in the case of the Company, through the Liquidity
Provider Agreement) as a result of any failure by the Transferor
to complete such Incremental Transfer including, without
limitation, any loss (including loss of anticipated profits) or
expense incurred by the Company or any Bank Investor, either
directly or indirectly (including, in the case of the Company,
pursuant to the Liquidity Provider Agreement) by reason of the
liquidation or reemployment of funds acquired by the Company (or
the Liquidity Provider) or any Bank Investor (including, without
limitation, funds obtained by issuing commercial paper or
promissory notes or obtaining deposits as loans from third
parties) for the Company or any Bank Investor to fund such
Incremental Transfer.
(c)  On the date of the initial Incremental Transfer, the Agent,
on behalf of the Company or the Bank Investors, as applicable,
shall deliver written confirmation to the Transferor of the
Transfer Price and the Transferor shall deliver to the Agent the
Transfer Certificate in the form of Exhibit F hereto (the
"Transfer Certificate").  The Agent shall indicate the amount of
the initial Incremental Transfer together with the date thereof
on the grid attached to the Transfer Certificate.  On the date of
each subsequent Incremental Transfer, the Agent shall send
written confirmation to the Transferor of the Transfer Price
applicable to such Incremental Transfer.  The Agent shall
indicate the amount of the Incremental Transfer together with the
date thereof as well as any decrease in the Net Investment on the
grid attached to the Transfer Certificate.  The Transfer
Certificate shall evidence the Incremental Transfers.  Following
each Incremental Transfer, the Company shall deposit to the
Transferor's account at the location indicated in Section 10.3
hereof, in immediately available funds, an amount equal to the
Transfer Price for such Incremental Transfer.
(d)  By no later than 11:00 a.m. (New York time) on any Transfer
Date, the Company or each Bank Investor, as the case may be,
shall remit its share (which, in the case of an Incremental
Transfer to the Bank Investors, shall be equal to such Bank
Investor's Pro Rata Share) of the aggregate Transfer Price for
such Transfer to the account of the Agent specified therefor from
time to time by the Agent by notice to such Persons.  The
obligation of each Bank Investor to remit its Pro Rata Share of
any such Transfer Price shall be several from that of each other
Bank Investor, and the failure of any Bank Investor to so make
such amount available to the Agent shall not relieve any other
Bank Investor of its obligation hereunder.  Following each
Incremental Transfer and the Agent's receipt of funds from the
Company or the Bank Investors as aforesaid, the Agent shall remit
the Transfer Price to the Transferor's account at the location
indicated in Section 10.3 hereof, in immediately available funds,
an amount equal to the Transfer Price for such Incremental
Transfer.  Unless the Agent shall have received notice from the
Company or any Bank Investor, as applicable, that such Person
will not make its share of any Transfer Price relating to any
Incremental Transfer available on the applicable Transfer Date
therefor, the Agent may (but shall have no obligation to) make
the Company's or any such Bank Investor's share of any such
Transfer Price available to the Transferor in anticipation of the
receipt by the Agent of such amount from the Company or such Bank
Investor.  To the extent the Company or any such Bank Investor
fails to remit any such amount to the Agent after any such
advance by the Agent on such Transfer Date, the Company or such
Bank Investor, on the one hand, and the Transferor, on the other
hand, shall be required to pay such amount, together with
interest thereon at a per annum rate equal to the Federal funds
rate (as determined in accordance with clause (ii) of the
definition of "Base Rate"), in the case of the Company, any such
Bank Investor, or the Transferor, to the Agent upon its demand
therefor (provided that the Company shall have no obligation to
pay such interest amounts except to the extent that it shall have
sufficient funds to pay the face amount of its Commercial Paper
in full).  Until such amount shall be repaid, such amount shall
be deemed to be Net Investment paid by the Agent and the Agent
shall be deemed to be the owner of a Transferred Interest
hereunder.  Upon the payment of such amount to the Agent (x) by
the Transferor, the amount of the aggregate Net Investment shall
be reduced by such amount or (y) by the Company or such Bank
Investor, such payment shall constitute such Person's payment of
its share of the applicable Transfer Price for such Transfer.
(e)  On each Business Day occurring after the initial Incremental
Transfer hereunder and prior to the Termination Date, the
Transferor hereby agrees to convey, transfer and assign to the
Agent, on behalf of the Company or the Bank Investors, the Agent,
on behalf of the Company may, and the Agent, on behalf of the
Bank Investors shall agree to purchase from the Transferor
undivided percentage ownership interests in each and every
Receivable, together with Collections and Proceeds with respect
thereto, to the extent that Collections are available for such
Transfer in accordance with Section 2.5 hereof, such that after
giving effect to such Transfer, (i) the amount of the Net
Investment at the close of business on such Business Day shall be
equal to the amount of the Net Investment at the close of the
business on the Business Day immediately preceding such Business
Day plus the Transfer Price of any Incremental Transfer made on
such day, if any, and (ii) the Transferred Interest in each
Receivable, together with Collections and Proceeds with respect
thereto, shall be equal to the Transferred Interest in each other
Receivable, together with Collections and Proceeds with respect
thereto.
(f)  Each Transfer shall constitute a transfer to the Agent, on
behalf of the Company or the Bank Investors, as applicable, of
undivided percentage ownership interests in each and every
Receivable, together with Collections and Proceeds with respect
thereto, then existing, as well as in each and every Receivable,
together with Collections and Proceeds with respect thereto,
which arises at any time after the date of such Transfer.  The
Agent's aggregate undivided percentage ownership interest in the
Receivables, together with the Collections and Proceeds with
respect thereto, held on behalf of the Company or the Bank
Investors, as applicable, shall equal the Buyer's Percentage
Factor in effect from time to time.  The Agent shall hold the
Transferred Interests on behalf of the Company and each Bank
Investor in accordance with each of the Company's and each Bank
Investor's percentage interest in the Transferred Interest
(determined on the basis of the relationship that the portion of
the Net Investment funded by such Person bears to the aggregate
Net Investment of the Company and all of the Bank Investors at
such time).
(g)  The Transferor shall issue to the Agent the Certificate, in
the form of Exhibit E, on or prior to the date hereof.
(h)  The Buyer's Percentage Factor shall be initially computed as
of the opening of business of the Collection Agent on the date of
the initial Incremental Transfer hereunder.  Thereafter until the
Termination Date, the Buyer's Percentage Factor shall be
automatically recomputed as of the close of business of the
Collection Agent on each day (other than a day after the
Termination Date).  The Buyer's Percentage Factor shall remain
constant from the time as of which any such computation or
recomputation is made until the time as of which the next such
recomputation, if any, shall be made.
          SECTION 2.3.     Selection of Interest Rates and Interest
          Periods; LIBOR Protection; Illegality.
          
          (a)  Prior to the Termination Date; Transferred Interest held on
behalf of the Company.  At all times hereafter, but prior to  the
Termination  Date  and not with respect to  any  portion  of  the
Transferred Interest held on behalf of the Bank Investors (or any
of  them), the Transferor may, subject to the Company's  approval
and  the  limitations  described  below,  request  that  the  Net
Investment  be  allocated among one or more funding  periods,  so
that  the aggregate amounts so allocated at all times shall equal
the Net Investment held on behalf of the Company.  The Transferor
shall give the Company irrevocable notice by telephone of the new
requested  funding  period(s) by 11:00  a.m.  at  least  one  (1)
Business Day prior to the expiration of any then existing funding
period;  provided, however, that the Company may select,  in  its
sole  discretion,  any  such  new  funding  period  if   (i)  the
Transferor fails to provide such notice on a timely basis or (ii)
the  Company determines, in its sole discretion, that the funding
period  requested  by the Transferor is unavailable  or  for  any
reason commercially undesirable.  The Company confirms that it is
its  intention  to  fund  all or substantially  all  of  the  Net
Investment  held  on  behalf of it by issuing Related  Commercial
Paper;  provided  that the Company may determine,  from  time  to
time, in its sole discretion, that funding such Net Investment by
means  of  Related  Commercial Paper is not possible  or  is  not
desirable  for  any  reason.  If the Liquidity Provider  acquires
from  the  Company  a  Purchased Interest  with  respect  to  the
Receivables  pursuant  to  the terms of  the  Liquidity  Provider
Agreement, NationsBank, on behalf of the Liquidity Provider,  may
exercise  the  right of selection granted to the Company  hereby.
The  initial  funding  period applicable to  any  such  Purchased
Interest shall be a period of not greater than 14 days and  shall
accrue Carrying Costs on the basis of the Base Rate.  Thereafter,
provided  that  the  Termination Date shall  not  have  occurred,
Carrying Costs shall accrue on the basis of either the Base  Rate
or the Adjusted LIBOR Rate, as determined by NationsBank.  In the
case of any funding period outstanding upon the Termination Date,
such funding period shall end on such date.

(b)  After the Termination Date; Transferred Interest Held on
behalf of the Company.  At all times on and after the Termination
Date, with respect to any portion of the Transferred Interest
which shall be held by the Agent on behalf of the Company, the
Company or NationsBank, as applicable, shall select all funding
periods and rates applicable thereto.
(c)  Prior to the Termination Date; Transferred Interest Held on
Behalf of Bank Investor.  At all times with respect to any
portion of the Transferred Interest held by the Agent on behalf
of the Bank Investors, but prior to the Termination Date, the
initial funding period applicable to such portion of the Net
Investment allocable thereto shall be a period of not greater
than 14 days and shall accrue Carrying Costs on the basis of the
Base Rate.  Thereafter, with respect to such portion, and with
respect to any other portion of the Transferred Interest held on
behalf of the Bank Investors (or any of them), provided that the
Termination Date shall not have occurred, Carrying Costs shall
accrue with respect thereto at either the Base Rate or the
Adjusted LIBOR Rate, at the Transferor's option.  The Transferor
shall give the Agent irrevocable notice by telephone of the new
requested funding period at least three (3) Business Days prior
to the expiration of any then existing funding period.  In the
case of any funding period outstanding upon the occurrence of the
Termination Date, such funding period shall end on the date of
such occurrence.
(d)  After the Termination Date; Transferred Interest Held on
behalf of Bank Investor.  At all times on and after the
Termination Date, with respect to any portion of the Transferred
Interest held by the Agent on behalf of the Bank Investors, the
Agent shall select all funding periods and rates applicable
thereto.
(e)  LIBOR Rate Protection; Illegality.
               (i)   If the Agent is unable to obtain on a timely
basis  the information necessary to determine the LIBOR Rate  for
any proposed funding period, then

               (A)   the  Agent shall forthwith  notify  the
          Company  or Bank Investors, as applicable and  the
          Transferor that the Adjusted LIBOR Rate cannot  be
          determined for such funding period, and
          
               (B)   while such circumstances exist, neither
          the Company, the Bank Investors or the Agent shall
          allocate  the  Net  Investment of  any  additional
          Transferred Interests purchased during such period
          or  reallocate the Net Investment allocated to any
          then  existing funding period ending  during  such
          period, to a funding period which accrues Carrying
          Costs on the basis of the Adjusted LIBOR Rate.
          
               (ii)  If, with respect to any outstanding  funding
period  which accrues Carrying Costs on the basis of the Adjusted
LIBOR Rate, the Company or any of the Bank Investors on behalf of
which  the Agent holds any Transferred Interest therein  notifies
the  Agent that it is unable to obtain matching deposits  in  the
London  inter-bank market to fund its purchase or maintenance  of
such  Transferred  Interest  or  that  the  Adjusted  LIBOR  Rate
applicable  to  such  Transferred Interest  will  not  adequately
reflect  the  cost  to the Person of funding or  maintaining  its
respective Transferred Interest for such funding period then  the
Agent shall forthwith so notify the Transferor, whereupon neither
the  Agent  nor the Company or the Bank Investors, as applicable,
shall,   while  such  circumstances  exist,  allocate   any   Net
Investment  of  any  additional  Transferred  Interest  purchased
during  such  period or reallocate the Net Interest allocated  to
any funding period ending during such period, to a funding period
which  accrues Carrying Costs on the basis of the Adjusted  LIBOR
Rate.

          (iii)      Notwithstanding any other provision of  this
Agreement,  if  the  Company or any of  the  Bank  Investors,  as
applicable,  shall  notify  the  Agent  that  such   Person   has
determined (or has been notified by any Liquidity Provider)  that
the introduction of or any change in or in the interpretation  of
any  law  or regulation after the Closing Date makes it  unlawful
(either  for  the Company, such Bank Investor, or such  Liquidity
Provider,   as  applicable),  or  any  central  bank   or   other
governmental  authority  asserts that it  is  unlawful,  for  the
Company,  such  Bank  Investor  or such  Liquidity  Provider,  as
applicable,  to fund the purchases or maintenance of  Transferred
Interests  at  the  Adjusted LIBOR  Rate,  then  (x)  as  of  the
effective date of such notice from such Person to the Agent,  the
obligation  or ability of the Company or such Bank  Investor,  as
applicable,  to  fund its purchase or maintenance of  Transferred
Interests  at  the Adjusted LIBOR Rate shall be  suspended  until
such  Person  notifies  the Agent that the circumstances  causing
such  suspension  no  longer exist and  (y)  the  Net  Investment
allocated to each funding period which accrues Carrying Costs  on
the basis of the Adjusted LIBOR Rate in which such Person owns an
interest shall either (1) if such Person may lawfully continue to
maintain  such  Transferred Interest at the Adjusted  LIBOR  Rate
until  the  last  day  of  the  applicable  funding  period,   be
reallocated  on  the last day of such funding period  to  another
funding  period in respect of which the Net Investment  allocated
thereto  which accrues Carrying Costs on a basis other  than  the
Adjusted LIBOR Rate or (2) if such Person shall determine that it
may  not  lawfully continue to maintain such Transferred Interest
at  the  Adjusted  LIBOR  Rate until the end  of  the  applicable
funding  period,  such  Person's  share  of  the  Net  Investment
allocated  to  such  funding period shall  be  deemed  to  accrue
Carrying  Costs on the basis of the Base Rate from the  effective
date of such notice until the end of such funding period.

          SECTION 2.4.     Carrying Costs, Fees and Other Costs and
          Expenses.
          
               The  Transferor agrees to pay, as and when due  in
accordance with this Agreement, each Early Collection Fee and all
Carrying Costs and Servicing Fees.  On each Remittance Date,  the
Transferor  shall pay to the Agent, on behalf of the  Company  or
the Bank Investors, as applicable, an amount equal to the accrued
and unpaid Carrying Costs for the related Collection Period.  The
Transferor  shall pay to the Agent, on behalf of the Company,  on
each  day  on  which Related Commercial Paper is  issued  by  the
Company,  the Dealer Fee with respect to such Related  Commercial
Paper.   All payments referred to in this Section shall  be  made
solely out of Collections, in the order of priority set forth  in
Section  2.5,  except for the amounts described in paragraph  (e)
of  the  definition  of "Carrying Costs,"  which  shall  be  paid
directly  by  the  Transferor  to  extent  Collections  are   not
available therefor.

          SECTION 2.5.    Allocations of Collections; Non-Liquidation
          Settlement and Reinvestment Procedures.
          
          (a)   On each Determination Date, the Collection Agent shall
allocate all Collections received during the preceding Collection
Period  as  Principal Collections or Finance Charge  Collections.
Principal Collections shall be applied by the Collection Agent as
described in subsection (d) below.  On each Remittance Date,  the
product of (A) the daily average of the Buyer's Percentage Factor
over  the  preceding  Collection Period  and  (B)  the  aggregate
Finance  Charge Collections for such preceding Collection  Period
(plus  any  investment  earnings on the Excess  Funding  Account)
shall be applied by the Collection Agent, without duplication, in
the  following  order  of priority.  (For all  purposes  in  this
Section  2.5,  the Buyer's Percentage Factor shall be  calculated
using the Buyer's Percentage Factor at the opening of business on
the first day of the preceding Collection Period):

          (i)  first, an amount equal to any accrued and unpaid Carrying
                 Costs for such Collection Period, shall be paid to the Agent 
                 for the account of the Company and the Bank Investors;
                 
(ii) second, to the payment to the Collection Agent of the
Buyer's Percentage Factor of any Servicing Fee due and owing;
(iii)     third, an amount equal to the Buyer's Percentage Factor
of Defaulted Receivables for the related Collection Period plus
an amount equal to the Buyer's Percentage Factor of any unpaid
Defaulted Receivables from prior Collection Periods shall be
applied as Principal Collections in accordance with Section
2.5(d) hereof;
(iv) fourth, to the payment of any Adjustment Payments which the
Transferor was required, but failed, to make under Section 2.9(a)
or any payment which the Transferor was required, but failed, to
make under Section 2.9(b), in each case during the related
Collection Period or any prior Collection Period, which payment
shall be applied as Principal Collections in accordance with
Section 2.5(d) below; and
(v)  fifth, to the extent any Finance Charge Collections remain
after application in accordance with clauses (i) through (iv)
above, (A) if prior to the Termination Date, such excess amounts
shall be (i) deposited in the Spread Account, up to the Spread
Account Cap Percentage Amount and (ii) thereafter, paid to the
Transferor and (B) if on or after the Termination Date such
excess amounts shall be paid to the Agent in reduction of the Net
Investment, until the Net Investment has been reduced to zero and
thereafter to the Transferor.
          (b)  On each Remittance Date, subject to Section 2.5(c), the
product  of (A) the Transferor's Percentage Factor at the opening
of  business on the first day of the preceding Collection  Period
and   (B)  the  aggregate  Finance  Charge  Collections  for  the
preceding Collection Period shall be applied as follows:

                    (i)  first, to the payment to the Collection Agent of the
          Transferor's Percentage Factor of any Servicing Fee due and
          owing;
          
(ii) second, an amount equal to the Transferor's Percentage
Factor of any Defaulted Receivables for the related Collection
Period and any such amount unpaid for prior Collection Periods
shall be applied as Principal Collections in accordance with
Section 2.5(d) below; and
(iii)     third, any remaining amounts shall be remitted to the
Transferor.
          (c)  In the event that, on any Remittance Date, the Buyer's
Percentage  Factor of Finance Charge Collections are insufficient
to  pay  the sum of the amounts due and payable pursuant  to  (x)
clause (a)(i) above, then, in such event, on such Remittance Date
the entire amount of Finance Charge Collections distributable  or
allocable  to  the  Transferor, up to  the  amount  of  any  such
insufficiency, or (y) clauses (a)(ii) through (a)(v) above, then,
in  such  event,  on such Remittance Date the amount  of  Finance
Charge  Collections distributable or allocable to the  Transferor
pursuant to clauses (b)(ii) and (b)(iii) above, up to the  amount
of   any   such  insufficiency,  and  to  the  extent  any   such
insufficiency continues to remain, the amounts then on deposit in
the  Spread  Account, then the amounts on deposit in  the  Excess
Funding  Account,  and  then  the amounts  distributable  to  the
Transferor  pursuant to Section 2.5(d), shall be reduced  by  the
amount  of  such  insufficiency, and  such  amount(s)   shall  be
applied   as   Finance  Charge  Collections  allocable   to   the
Transferred  Interest  and shall be applied  and  distributed  in
accordance with the priority set forth in clauses (i) through (v)
of Section 2.5(a).

(d)  On each Remittance Date prior to the Termination Date, (i)
the Collection Agent shall allocate to the Company and/or the
Bank Investors the Buyer's Percentage Factor of Principal
Collections received during the related Collection Period and not
previously accounted for or applied toward reinvestment in new
Receivables or reduction of the Net Investment, and, at the
Transferor's option, (A) pay such amount to the Transferor, for
the benefit of the Company and/or the Bank Investors, and the
Transferor shall apply such amount toward the purchase of
additional undivided percentage interests in each Receivable
pursuant to Section 2.2(b), or (B) pay such amount plus, at the
Transferor's option, subject to Section 2.5(f) below, all or a
portion of the amount on deposit in the Excess Funding Account,
to the Agent in reduction of the Net Investment and (ii) the
Collection Agent shall pay to the Transferor the portion of such
Principal Collections not allocated to the Transferred Interest
and remaining after any reallocations pursuant to Section 2.5(c)
above.
               On  each Remittance Date on or subsequent  to  the
Termination  Date,  the Collection Agent shall  allocate  to  the
Company  or  the  Bank  Investors,  as  applicable,  the  Buyer's
Percentage  Factor of all Principal Collections  received  during
the  related  Collection  Period and not  previously  applied  or
accounted for, plus all amounts on deposit in the Excess  Funding
Account, and pay such amount to the Agent in reduction of the Net
Investment.   In  the event the Termination Date  occurred  as  a
result  of  a  Termination Event (other than a Termination  Event
caused  by  items  (k)  or  (l) of the definition  thereof),  the
portion  of  such  Principal Collections  not  allocated  to  the
Transferred   Interest  and  remaining  after  any  reallocations
pursuant  to  Section 2.5(c) above shall be  distributed  to  the
Agent in reduction of the Net Investment and, in the case of  any
other Termination Date, the portion of such Principal Collections
not allocated to the Transferred Interest and remaining after any
allocations pursuant to Section 2.5(c) above shall be distributed
to the Transferor.

          (e)  The Transferor shall have the option to designate a fixed or
variable  percentage (the "Discount Percentage") of all Principal
Receivables (without giving effect to Discount Receivables) to be
treated as finance charge receivables ("Discount Receivables") in
accordance with the provisions of this Section 2.5(e), and  shall
be  applied  in accordance with Section 2.5(a), which  percentage
shall  remain  fixed  and  in  effect  until  such  time  as  the
Transferor has provided a subsequent designation to the Agent and
the Agent shall consent thereto.  The initial Discount Percentage
shall equal 7.5%.

(f)  On any Business Day prior to the Termination Date on which
the Buyer's Percentage Factor of the aggregate Principal
Receivables is equal to or greater than the Net Investment, the
Transferor or Collection Agent may request that any or all
amounts in the Excess Funding Account be distributed to the
Transferor.
          SECTION 2.6.     Liquidation Settlement Procedures.
          
               On each Remittance Date occurring on and following
the  Termination Date, Principal Collections shall be applied  in
accordance  with Section 2.5(d). The Agent, upon its  receipt  of
such  amounts  in  the  Agent's account,  shall  distribute  such
amounts to the Company and/or the Bank Investors entitled thereto
as  set  forth  above;  provided that if  the  Agent  shall  have
insufficient funds to pay all of the above amounts in full on any
such  date,  the  Agent shall pay such amounts in  the  order  of
priority  set forth above and, with respect to any such  category
above  for which the Agent shall have insufficient funds  to  pay
all amounts owing on such date, ratably (based on the amounts  in
such  categories  owing to such Persons) among all  such  Persons
entitled to payment thereof.

               Following the date on which the Net Investment has
been  reduced to zero and all other Aggregate Unpaids  have  been
paid  in  full,  (i)  the Collection Agent  shall  recompute  the
Buyer's  Percentage Factor as zero, (ii) the Agent, on behalf  of
the  Company  and  the Bank Investors, shall be  deemed  to  have
reconveyed to the Transferor all of the Agent's right, title  and
interest in and to the Affected Assets (including the Transferred
Interest), (iii) the Collection Agent shall pay to the Transferor
any  remaining  Collections held by the Agent or  the  Collection
Agent  pursuant  to Section 2.5 or 2.12 and (iv)  the  Agent,  on
behalf  of the Company and the Bank Investors, shall execute  and
deliver  to  the  Transferor, at the Transferor's  expense,  such
documents  or  instruments  as are  necessary  to  terminate  the
Agent's  interests  in the Affected Assets.  Any  such  documents
shall be prepared by or on behalf of the Transferor.

          SECTION 2.7.     Fees.
          
               On  each Remittance Date the Transferor shall  pay
(which  payments shall be made from Collections in the  order  of
priority set forth in Section 2.5), with respect to the preceding
Collection Period, to the Company solely for its own account, the
Program  Fee  and the Administrative Fee, and to the  Agent,  for
distribution to the Bank Investors, the Facility Fee.

          SECTION 2.8.     Protection of Ownership Interest of the Company
          and the Bank Investors.
          
          (a)  The Transferor agrees that it will, and will cause the
Initial  Purchaser  and  the Seller to, from  time  to  time,  at
Transferor's   expense,   promptly  execute   and   deliver   all
instruments  and  documents  and  take  all  actions  as  may  be
necessary  or  as the Agent may reasonably request  in  order  to
perfect  or  protect the Transferred Interest or  to  enable  the
Agent,  the Company or the Bank Investors to exercise or  enforce
any  of their respective rights hereunder.  Without limiting  the
foregoing,  the  Transferor will, and will cause the  Seller  and
Initial  Purchaser to, upon the request of the Agent, the Company
or any of the Bank Investors, in order to accurately reflect this
purchase and sale transaction, execute and file such financing or
continuation  statements  or amendments  thereto  or  assignments
thereof (as permitted pursuant to Section 9.7 hereof) as  may  be
requested by the Agent, the Company or any of the Bank Investors.
The  Transferor shall, and shall cause the Initial Purchaser  and
the  Seller to, upon request of the Agent, the Company or any  of
the  Bank Investors obtain such additional search reports as  the
Agent,  the  Company or any of the Bank Investors shall  request.
To  the  fullest  extent permitted by applicable law,  the  Agent
shall  be permitted to sign and file continuation statements  and
assignments  thereof  without the Transferor's  or  the  Seller's
signature.   Carbon, photographic or other reproduction  of  this
Agreement  or  any financing statement shall be sufficient  as  a
financing  statement.  The Transferor shall not,  and  shall  not
permit  the Initial Purchaser or Seller to, change its respective
name,  identity  or corporate structure (within  the  meaning  of
Section  9-402(7) of the UCC as in effect in the  States  of  New
York,  Utah, Delaware and Minnesota, as applicable, relocate  its
respective   chief  executive  office  unless  it   shall   have:
(i)  given  the  Agent  at least thirty (30)  days  prior  notice
thereof  and (ii) prepared at Transferor's expense and  delivered
to  the  Agent  all financing statements, instruments  and  other
documents  necessary  to  preserve and  protect  the  Transferred
Interest or requested by the Agent in connection with such change
or  relocation.  Any filings under the UCC or otherwise that  are
occasioned  by such change in name or location shall be  made  at
the expense of Transferor.  The Transferor shall notify the Agent
promptly  after it, the Initial Purchaser or the Seller relocates
any office where Records are kept of any such new location.

(b)  The Transferor agrees that it will, and will cause the
Seller and each other Person having possession of any Records to,
at Transferor's  expense, on or prior to the Closing Date
indicate clearly and unambiguously in its master data processing
records and on any storage containers containing Records that the
Receivables created in connection with the Accounts have been
conveyed to the Transferor and transferred to the Agent, for the
benefit of the Company and the Bank Investors.  The Transferor
further agrees to deliver or to cause the Collection Agent to
deliver to the Agent a computer file or microfiche list
containing a true and complete list of all such Accounts,
identified by account number and by Receivable balance as of the
Cut-Off Date. Such file or list shall be marked as the Account
Schedule delivered to the Agent as confidential and proprietary,
and is hereby incorporated into and made a part of this
Agreement.  The Transferor agrees to deliver or to cause the
Collection Agent to deliver to the Agent within five (5) Business
Days of the request therefor by the Agent a computer file or
microfiche list containing a true and complete list of all
Accounts, including all Related Accounts created on or after the
Cut-Off Date, in existence as of the last day of the prior
Collection Period, identified by account number and by Receivable
balance as of the last day of the prior Collection Period.  Such
file or list shall be marked as the Account Schedule delivered to
the Agent as confidential and proprietary, shall replace the
previously delivered Account Schedule and shall be incorporated
into and made a part of this Agreement.  The Collection Agent
agrees, on behalf of the Transferor, at its own expense, by the
end of each Collection Period in which any Accounts or Related
Accounts have been originated to indicate clearly and
unambiguously in its master data processing records and any
storage containers containing Records that the Receivables
created in connection with such Accounts have been conveyed to
the Transferor and transferred to the Agent, for the benefit of
the Company and the Bank Investors, pursuant to this Agreement.
          SECTION 2.9.     Application of Payments.
          
          (a)  If on any day any Receivable is either (x) reduced or
canceled  as  a  result  of any defective, rejected  or  returned
merchandise  or services, any discount, credit, rebate,  dispute,
warranty  claim,  chargeback, allowance or any billing  or  other
adjustment, or (y) reduced or canceled as a result of a setoff or
offset in respect of any claim by any Person (whether such  claim
arises  out of the same or a related transaction or an  unrelated
transaction  and  whether  such  reduction  or  cancellation   is
effected  through the granting of credits against the  applicable
Receivables  or  by the issuance of a check or other  payment  in
respect of, and as payment for, such reduction) or (z) any  other
downward  adjustments to the balance of such  Receivable  without
receiving  Collections  therefor and  prior  to  such  Receivable
becoming   a   Defaulted  Receivable,  then  such  amount   shall
thereafter  be  deducted  from  the  aggregate  balance  of   the
Receivables  and  the Principal Receivables.  If  such  reduction
would  result  in  a Buyer's Percentage Factor greater  than  the
Maximum  Buyer's Percentage Factor, the Transferor shall pay  (or
direct   the   Servicer   to  pay  from   Collections   otherwise
distributable  to  the Transferor) to the Agent  an  amount  (the
payment  of  such amount is herein referred to as an  "Adjustment
Payment") equal to the amount that, when (A) deposited  into  the
Excess  Funding Account or (B) applied in reduction  of  the  Net
Investment, will result in a Buyer's Percentage Factor less  than
or  equal  to  the  Maximum Buyer's Percentage  Factor.   At  the
Transferor's  election, such amount shall be (A)  deposited  into
the  Excess  Funding Account or (B) applied by the Agent  to  the
reduction of the Net Investment.

(b)  If on any day any of the representations or warranties set
forth in (x) Section 3.1 (d), (j), (l) or (s) or Section 3.3(f)
was or becomes untrue with respect to a Receivable or (y) Section
3.1(e) or Section 3.3(d) was or becomes untrue with respect to
the existence or amount of any Receivable (whether, in any case,
on or after the date of any transfer of an interest therein to
the Agent, the Company or the Bank Investors as contemplated
hereunder), then such Receivable shall thereafter not be included
in any calculation of the outstanding Receivables or the
Principal Receivables; provided, however, that if such
representations and warranties shall on any day thereafter be
true and correct in all material respects as if such Receivable
had then been created, such Receivable shall be eligible for
purchase hereunder.  If such reduction would result in a Buyer's
Percentage Factor greater than the Maximum Buyer's Percentage
Factor, the Transferor shall pay (or direct the Servicer to pay
from Collections otherwise distributable to the Transferor) to
the Agent an amount equal to the amount that, when (A) deposited
into the Excess Funding Account or (B) applied in reduction of
the Net Investment, will result in a Buyer's Percentage Factor
less than or equal to the Maximum Buyer's Percentage Factor.  At
the Transferor's election, such amount shall be (A) deposited
into the Excess Funding Account or (B) applied by the Agent to
the reduction of the Net Investment.
          SECTION 2.10.    Payments and Computations, Etc.
          
               All  amounts  to  be  paid  or  deposited  by  the
Transferor  or the Collection Agent hereunder shall  be  paid  or
deposited in accordance with the terms hereof no later than 11:00
a.m.  (New  York  City time) on the day when due  in  immediately
available  funds;  if  such  amounts are  payable  to  the  Agent
(whether  on  behalf  of  the Company or  any  Bank  Investor  or
otherwise)  they  shall  be  paid or  deposited  in  the  account
indicated in Section 10.3 hereof, until otherwise notified by the
Agent.  The Transferor shall, to the extent permitted by law, pay
to  the  Agent,  for  the benefit of the  Company  and  the  Bank
Investors  upon  demand,  interest on all  amounts  not  paid  or
deposited when due hereunder at a rate equal to 2% per annum plus
the  Base Rate.  All computations of  interest and all per  annum
fees  hereunder shall be made on the basis of a year of 360  days
for  the actual number of days (including the first but excluding
the  last day) elapsed.  Any computations by the Agent of amounts
payable  by  the Transferor hereunder shall create  a  rebuttable
presumption of correctness.

          SECTION 2.11.    Reports.
          
          (a)  Prior to each Determination Date after the Closing Date,
beginning  with  the  November 18, 1997 Determination  Date,  the
Collection  Agent shall prepare and forward to the Agent  (i)  an
Investor  Report as of the end of the last day of the immediately
preceding  month, (ii) if requested by the Agent,  a  listing  by
Obligor  of  all  Receivables together  with  an  aging  of  such
Receivables  and (iii) such other information as  the  Agent  may
reasonably request.

(b)  On or before the date of an Incremental Transfer, the
Collection Agent shall prepare and forward to the Agent an
Additional Investment Certificate, reporting the Principal
Receivables, the Buyer's Percentage Factor, the Spread Account
Cap Percentage Amount, the amount on deposit in the Spread
Account and such other information as the Agent may request (i)
as of the close of business on the Business Day preceding the
date of the requested Incremental Transfer, beginning on or after
March 3, 1998, and (ii) as of the close of business on the second
Business Day preceding the date of the Incremental Transfer,
through March 2, 1998.
          SECTION 2.12.    Collection Account, Spread Account and Excess
          Funding Account.
          
          (a)  There shall be established on the day of the initial
Incremental Transfer hereunder and maintained with the  Agent,  a
segregated   account  (the  "Collection  Account"),   bearing   a
designation  clearly indicating that the funds deposited  therein
are  held for the benefit of the Agent, on behalf of the  Company
and  the Bank Investors.  The Collection Agent shall remit  daily
but  in  any  event within forty-eight hours of  receipt  to  the
Collection  Account,  (a)  if  prior  to  the  occurrence  of   a
Termination  Event  (or during the occurrence  of  a  Termination
Event  listed  in clause (k) or (l) of Section 7.1)  the  Buyer's
Percentage Factor of all Finance Charge Collections, and  (b)  if
on  or  after the occurrence of a Termination Event (except those
listed  in  clause  (k) or (l) of Section 7.1),  all  Collections
received with respect to any Receivables.  For purposes  of  this
Section  2.12(a),  the  Buyer's  Percentage  Factor  during   any
Collection Period shall be the Buyer's Percentage Factor  at  the
opening  of business on the first day of such Collection  Period.
Funds on deposit in the Collection Account (other than investment
earnings)  shall be invested by the Agent in Eligible Investments
that  will mature so that such funds will be available  prior  to
the   Remittance  Date  following  such  investment.    On   each
Remittance  Date, all interest and earnings (net  of  losses  and
investment  expenses)  on  funds on  deposit  in  the  Collection
Account  shall  be  applied as if such amounts were  the  Buyer's
Percentage Factor of Finance Charge Collections.  On the date  on
which the Net Investment and all Aggregate Unpaids have been paid
in full, any funds remaining on deposit in the Collection Account
shall be paid to the Transferor.

(b)  (i)  There shall be established on the Closing Date
hereunder and maintained with the Agent a segregated account (the
"Spread Account"), bearing a designation clearly indicating that
the funds deposited therein are held for the benefit of the
Agent, on behalf of the Company and the Bank Investors.  On each
Determination Date, the Spread Account Cap Percentage Amount for
such Determination Date shall be calculated by the Agent.  If the
funds on deposit in the Spread Account on such Determination Date
are less than the Spread Account Cap Percentage Amount,
Collections shall be deposited into the Spread Account on the
next succeeding Remittance Date in accordance with Section 2.5 up
to the Spread Account Cap Percentage Amount.
          (ii)   Funds  on  deposit in the Spread Account  (other
than  investment  earnings) shall be invested  by  the  Agent  in
Eligible  Investments  that will mature so  that  funds  will  be
available prior to the Remittance Date following such investment.
On each Remittance Date, all interest and earnings (net of losses
and  investment  expenses)  on funds on  deposit  in  the  Spread
Account  shall  be  applied as if such amounts were  the  Buyer's
Percentage Factor of Finance Charge Collections.  On the date  on
which the Net Investment and all Aggregate Unpaids have been paid
in  full,  any  funds remaining on deposit in the Spread  Account
shall be paid to the Transferor.

          (c)  (i)  There shall be established on the Closing Date
hereunder  and  maintained  with the  Agent  either  a  separate,
segregated account or a subaccount of the Collection Account (the
"Excess   Funding   Account"),  bearing  a  designation   clearly
indicating  that  the funds deposited therein are  held  for  the
benefit  of  the  Agent, on behalf of the Company  and  the  Bank
Investors.   In the event that on any day the Buyer's  Percentage
Factor  exceeds  the  Maximum  Buyer's  Percentage  Factor,   the
Collection  Agent  shall remit to the Excess Funding  Account  an
amount  of  Principal Collections which would cause  the  Buyer's
Percentage  Factor  not to exceed the Maximum Buyer's  Percentage
Factor.

          (ii)   Funds  on deposit in the Excess Funding  Account
(other  than investment earnings) shall be invested by the  Agent
at  the direction of the Collection Agent in Eligible Investments
that  will  mature so that funds will be available prior  to  the
Remittance  Date  following such investment.  On each  Remittance
Date, all funds on deposit in the Excess Funding Account shall be
available  to  make any payments required to  be  made  from  the
Excess  Funding Account in accordance with Section 2.5.   On  the
date  on which the Net Investment and all Aggregate Unpaids  have
been  paid in full, any funds remaining on deposit in the  Excess
Funding Account shall be paid to the Transferor.

          SECTION 2.13.    Sharing of Payments, Etc.
          
               If  the Company or any Bank Investor (for purposes
of  this  Section  only, being a "Recipient")  shall  obtain  any
payment (whether voluntary, involuntary, through the exercise  of
any  right  of  setoff, or otherwise) on account  of  Transferred
Interest  owned  by it (other than pursuant to  Section  2.7,  or
Article VIII and other than as a result of the differences in the
timing of the applications of Collections pursuant to Section 2.5
or  2.6) in excess of its ratable share of payments on account of
Transferred  Interest  obtained by the Company  and/or  the  Bank
Investors   entitled  thereto,  such  Recipient  shall  forthwith
purchase from the Company and/or the Bank Investors entitled to a
share  of  such amount participations in the Percentage Interests
owned  by  such  Persons  as shall be  necessary  to  cause  such
Recipient  to  share the excess payment ratably  with  each  such
other Person entitled thereto; provided, however, that if all  or
any  portion of such excess payment is thereafter recovered  from
such  Recipient, such purchase from each such other Person  shall
be  rescinded  and  each such other Person  shall  repay  to  the
Recipient  the  purchase price paid by such  Recipient  for  such
participation  to the extent of such recovery, together  with  an
amount  equal to such other Person's ratable share (according  to
the  proportion of (a) the amount of such other Person's required
payment  to (b) the total amount so recovered from the Recipient)
of  any interest or other amount paid or payable by the Recipient
in respect of the total amount so recovered.

          SECTION 2.14.    Right of Setoff.
          
               Without  in  any  way limiting the  provisions  of
Section  2.13,  each  of the Company and the  Bank  Investors  is
hereby  authorized (in addition to any other rights it may  have)
at  any  time  after  the occurrence of the Termination  Date  or
during  the  continuance  of  a Potential  Termination  Event  to
setoff,  appropriate  and  apply  (without  presentment,  demand,
protest  or  other notice which are hereby expressly waived)  any
deposits  held  by  the  Company or such  Bank  Investor  in  the
Collection  Account,  the Excess Funding Account  or  the  Spread
Account  to,  or for the account of, the Transferor  against  the
amount  of the Aggregate Unpaids owing by the Transferor to  such
Person  or  to  the  Agent  on behalf of  such  Person  (even  if
contingent or unmatured).

                                
                          ARTICLE I II
                                
                 REPRESENTATIONS AND WARRANTIES
                                
          SECTION 3.

          SECTION 3.1.     Representations and Warranties of the
          Transferor.
          
               The  Transferor  represents and  warrants  to  the
Agent, the Company and the Bank Investors that:

          (a)  Corporate Existence and Power.

               The  Transferor  is a corporation duly  organized,
validly  existing  and in good standing under  the  laws  of  its
jurisdiction of incorporation and has all corporate power and all
material  governmental  licenses,  authorizations,  consents  and
approvals  required to carry on its business in each jurisdiction
in  which its business is now conducted.  The Transferor is  duly
qualified  to do business in, and is in good standing  in,  every
other  jurisdiction in which the nature of its business  requires
it  to  be  so  qualified, except where  the  failure  to  be  so
qualified  or in good standing would not have a Material  Adverse
Effect.

          (b)  Corporate and Governmental Authorization; Contravention.

               The  execution,  delivery and performance  by  the
Transferor of this Agreement, the Receivables Purchase  Agreement
to  which  it  is  a party, the Fee Letter, the Certificate,  the
Transfer Certificate and the other Transaction Documents to which
the  Transferor is a party are within the Transferor's  corporate
powers,  have  been  duly authorized by all  necessary  corporate
action,  require no action by or in respect of, or  filing  with,
any Official Body or official thereof (except as contemplated  by
Section  2.8  hereof),  and do not contravene,  or  constitute  a
default   under,  any  provision  of  applicable  law,  rule   or
regulation  or of the Certificate of Incorporation or  Bylaws  of
the  Transferor or of any agreement, judgment, injunction, order,
writ,  decree or other instrument binding upon the Transferor  or
result in the creation or imposition of any Adverse Claim on  the
assets  of  the Transferor or any of its Subsidiaries (except  as
contemplated by Section 2.8 hereof).

          (c)  Binding Effect.

               Each  of  this Agreement, the Receivables Purchase
Agreements  to  which  it  is  a  party,  the  Fee  Letter,   the
Certificate  and  the other Transaction Documents  to  which  the
Transferor  is a party constitutes, and the Transfer  Certificate
upon  payment  of  the  Transfer Price  set  forth  therein  will
constitute,  the  legal,  valid and  binding  obligation  of  the
Transferor, enforceable against it in accordance with its  terms,
subject to applicable bankruptcy, insolvency, moratorium or other
similar laws affecting the rights of creditors generally  and  as
such  enforceability  may  be limited by  general  principles  of
equity (whether considered in a proceeding at law or in equity).

          (d)  Perfection.

               Immediately preceding each Transfer hereunder, the
Transferor  shall be the lawful owner of all of the  Receivables,
free  and  clear  of all Adverse Claims.  On  or  prior  to  each
Transfer and each recomputation of the Transferred Interest,  all
financing statements and other documents required to be  recorded
or  filed  in  order  to perfect and protect Agent's  Transferred
Interest  against  all  creditors  of  and  purchasers  from  the
Transferor, the Initial Purchaser and the Seller will  have  been
duly  filed in each filing office necessary for such purpose  and
all  filing  fees  and taxes, if any, payable in connection  with
such filings shall have been paid in full.

          (e)  Accuracy of Information.

               All  information  heretofore furnished  by  or  on
behalf  of  the  Seller, the Collection Agent or  the  Transferor
(including without limitation, the Investor Reports, any  reports
delivered  pursuant to Section 2.11 hereof and  the  Transferor's
financial statements) to the Company, any Bank Investors  or  the
Agent for purposes of or in connection with this Agreement or any
transaction  contemplated  hereby is, and  all  such  information
hereafter  furnished by the Transferor to the Company,  any  Bank
Investors,  the  Agent or the Agent will be, true,  accurate  and
complete  in every material respect, on the date such information
is stated or certified.

          (f)  Tax Status.

               The Transferor has filed all tax returns (federal,
state  and  local)  required to be filed and  has  paid  or  made
adequate provision for the payment of all taxes, assessments  and
other governmental charges, except to the extent it is contesting
any  such  payment in good faith, through appropriate proceedings
and after having set aside adequate reserves therefor.

          (g)  No Actions, Suits.

               There are no actions, suits or proceedings pending
or,  to  the  knowledge of the Transferor, threatened against  or
affecting the Transferor, the Seller or the Initial Purchaser  or
their  respective properties, in or before any court,  arbitrator
or  other  body, which question the validity of the  transactions
contemplated  hereby or which, individually or in the  aggregate,
could reasonably be expected to have a Material Adverse Effect.

          (h)  Use of Proceeds.

               No  proceeds of any Transfer will be used  by  the
Transferor  to acquire any security in any transaction  which  is
subject  to  Section 13 or 14 of the Securities Exchange  Act  of
1934, as amended.

          (i)  Place of Business.

               The   principal  place  of  business   and   chief
executive office of the Transferor are located at the address  of
the  Transferor indicated in Section 10.3 hereof and the  offices
where  the Transferor keeps all its Records, are located in  Salt
Lake  City,  Utah,  Omaha, Nebraska, Hennepin County,  Minnesota,
Tulsa, Oklahoma and St. Cloud, Minnesota and such other addresses
as are described on Exhibit G or such other locations notified to
the   Company   in  accordance  with  Section   2.8   hereof   in
jurisdictions where all action required by Section 2.8 hereof has
been taken and completed.

          (j)  Good Title.

               Upon  each Transfer and each recomputation of  the
Transferred  Interest,  the  Agent  shall  acquire  a  valid  and
perfected first priority undivided percentage ownership  interest
to  the  extent  of the Transferred Interest or a first  priority
perfected security interest in each Receivable that exists on the
date  of  such Transfer and recomputation and in the  Collections
with respect thereto free and clear of any Adverse Claim.

          (k)  Tradenames, Etc.

               Except as set forth on Exhibit H, as amended  from
time  to  time,  (i) the Transferor's chief executive  office  is
located  at  the  address for notices set forth in  Section  10.3
hereof;  (ii)  the Seller has no subsidiaries or  divisions;  and
(iii)  the  Transferor  has, within  the  last  five  (5)  years,
operated only under its legal name, and, within the last five (5)
years,  has  not  changed  its  name,  merged  with  or  into  or
consolidated  with any other corporation or been the  subject  of
any   proceeding  under  Title  11,  United  States   Code   (the
"Bankruptcy Code").

          (l)  Nature of Receivables.

               Each  Receivable (x) represented by the Transferor
or  the  Collection Agent to be an Eligible Receivable (including
in  any  Investor  Report or other report delivered  pursuant  to
Section  2.11  hereof)  or (y) included  in  the  calculation  of
Principal  Receivables  in  fact  satisfies  at  such  time   the
definition thereof.

          (m)  Coverage Requirement; Amount of Receivables.

               The  Buyer's Percentage Factor does not exceed the
Maximum  Buyer's Percentage Factor.  As of the Cut-Off Date,  the
aggregate  outstanding  balance of the Principal  Receivables  in
existence was $367,560,721.04.

          (n)  Collections and Servicing.

               Since  July  29, 1997, there has been no  material
adverse  change in the ability of the Collection  Agent  (to  the
extent  it  is  the Seller, the Transferor or any  Subsidiary  or
Affiliate  of  any of the foregoing) to service and  collect  the
Receivables.

          (o)  No Termination Event.

               No  event  has occurred and is continuing  and  no
condition  exists  which  constitutes a Termination  Event  or  a
Potential Termination Event.

          (p)  Not an Investment Company.

               The  Transferor is not, and is not controlled  by,
an  "investment  company" within the meaning  of  the  Investment
Company Act of 1940, as amended, or is exempt from all provisions
of such Act.

          (q)  ERISA.

               Each of the Transferor and its ERISA Affiliates is
in  compliance in all material respects with ERISA  and  no  lien
exists  in  favor of the Pension Benefit Guaranty Corporation  on
any of the Receivables.

          (r)  Bulk Sales.

               No  transaction  contemplated  hereby  or  by  the
Receivables Purchase Agreements requires compliance with any bulk
sales act or similar law.

          (s)  Transfers under Receivables Purchase Agreements.

               Each Receivable which has been transferred to  the
Transferor by the Initial Purchaser and to the Initial  Purchaser
by the Seller has been purchased, respectively, by the Transferor
from the Initial Purchaser and by the Initial Purchaser from  the
Seller  pursuant  to, and in accordance with, the  terms  of  the
respective Receivables Purchase Agreements.  The Affected  Assets
have been conveyed by DMCCB to the Initial Purchaser pursuant  to
the  Receivables Purchase Agreement between DMCCB and the Initial
Purchaser.

          (t)  Preference; Voidability.

               The  Transferor  and the Initial  Purchaser  shall
have  given reasonably equivalent value to the Initial  Purchaser
and  the  Seller, respectively, in consideration for the transfer
to  the  Transferor and the Initial Purchaser of the  Receivables
from the Initial Purchaser and the Seller, respectively, and each
such  transfer shall not have been made for or on account  of  an
antecedent  debt owed by the Initial Purchaser to the  Transferor
or  Seller  to the Initial Purchaser, respectively, and  no  such
transfer  is  or  may  be  voidable  under  any  Section  of  the
Bankruptcy Code.

          (u)  Representations and Warranties of the Seller.

               Each of the representations and warranties of  the
Seller  and  Initial  Purchaser  set  forth  in  the  Receivables
Purchase Agreements and of the Seller, Initial Purchaser and  the
Transferor  in  each  other Transaction  Document  are  true  and
correct  in  all  material  respects and  the  Transferor  hereby
remakes  all such representations and warranties for the  benefit
of  the Company, the Bank Investors and the Agent.  Any document,
instrument,  certificate  or  notice  delivered  to  the  Company
hereunder  shall be deemed a representation and warranty  by  the
Transferor.

          SECTION 3.2.     Reaffirmation of Representations and Warranties
          by the Transferor.
          
               On each day that a Transfer is made hereunder, the
Transferor,  by accepting the proceeds of such Transfer,  whether
delivered to the Transferor pursuant to Section 2.2(a) or Section
2.5   hereof,  shall  be  deemed  to  have  certified  that   all
representations  and warranties described in Section  3.1  hereof
are  correct on and as of such day as though made on  and  as  of
such  day.   Each  Incremental Transfer shall be subject  to  the
further  condition  precedent that prior  to  the  date  of  such
Incremental  Transfer, the Collection Agent shall have  delivered
to  the Agent, in form and substance satisfactory to the Agent  a
completed  Additional Investment Certificate, together with  such
additional  information  as may be reasonably  requested  by  the
Agent; and the Transferor shall be deemed to have represented and
warranted that such conditions precedent have been satisfied.

          SECTION 3.3.     Representations and Warranties of the Collection
          Agent.
          
               The  Collection Agent represents and  warrants  to
the Company and the Bank Investors that:

          (a)  Corporate Existence and Power.

               The   Collection  Agent  is  a  national   banking
association duly organized, validly existing and in good standing
under  the laws of the United States and has all corporate  power
and  all material governmental licenses, authorizations, consents
and   approvals  required  to  carry  on  its  business  in  each
jurisdiction  in  which  its  business  is  now  conducted.   The
Collection Agent is duly qualified to do business in, and  is  in
good  standing  (or is exempt from such requirements)  in,  every
other  jurisdiction in which the nature of its business  requires
it  to  be  so  qualified, except where  the  failure  to  be  so
qualified  or in good standing would not have a Material  Adverse
Effect.

          (b)  Corporate and Governmental Authorization; Contravention.

               The  execution,  delivery and performance  by  the
Collection  Agent  of  this Agreement are within  the  Collection
Agent's  corporate  powers,  have been  duly  authorized  by  all
necessary  corporate action, require no action by or  in  respect
of, or filing with, any Official Body or official thereof, and do
not  contravene, or constitute a default under, any provision  of
applicable  law,  rule  or  regulation  or  of  the  Articles  of
Association  or  Bylaws  of  the  Collection  Agent  or  of   any
agreement,  judgment, injunction, order, writ,  decree  or  other
instrument  binding upon the Collection Agent or  result  in  the
creation or imposition of any Adverse Claim on the assets of  the
Collection   Agent  or  any  of  its  Subsidiaries   (except   as
contemplated by Section 2.8).

          (c)  Binding Effect.

               This  Agreement constitutes the legal,  valid  and
binding  obligation  of  the  Collection  Agent,  enforceable  in
accordance  with  its  terms, subject to  applicable  bankruptcy,
insolvency, moratorium or other similar laws affecting the rights
of creditors and as such enforceability may be limited by general
principles of equity (whether considered in a proceeding  at  law
or in equity).

          (d)  Accuracy of Information.

               All   information  heretofore  furnished  by   the
Collection Agent to the Agent, the Company, any Bank Investor  or
the Agent for purposes of or in connection with this Agreement or
any  transaction contemplated hereby is, and all such information
hereafter  furnished by the Collection Agent to  the  Agent,  the
Company,  any  Bank  Investor or the  Agent  will  be,  true  and
accurate  in every material respect, on the date such information
is stated or certified.

          (e)  Actions, Suits.

               There   are   no  actions,  suits  or  proceedings
pending,  or to the knowledge of the Collection Agent threatened,
against  or  affecting  the Collection Agent  or  its  respective
properties,  in  or before any court, arbitrator or  other  body,
which  may,  individually or in the aggregate,  have  a  Material
Adverse Effect.

          (f)  Nature of Receivables.

               Each Receivable included in the calculation of the
Principal  Receivables  in  fact  satisfies  at  such  time   the
definition of "Eligible Receivable".

          (g)  Amount of Receivables.

               As  of the Cut-Off Date, the aggregate outstanding
balance   of   the   Principal  Receivables  in   existence   was
$367,560,721.04.

          (h)  Collections and Servicing.

               Since  July  29, 1997, there has been no  material
adverse  change in the ability of the Collection Agent to service
and collect the Receivables.

          (i)  Not an Investment Company.

               The Collection Agent is not, and is not controlled
by,  an "investment company" within the meaning of the Investment
Company Act of 1940, as amended, or is exempt from all provisions
of such Act.

          (j)  Tax Status.

               The  Collection  Agent has filed all  tax  returns
(federal, state and local) required to be filed and has  paid  or
made adequate provision for the payment of all taxes, assessments
and  other  governmental charges, except  to  the  extent  it  is
contesting  any  such payment in good faith, through  appropriate
proceedings   and  after  having  set  aside  adequate   reserves
therefor.

          (k)  ERISA.

               The  Collection  Agent  is in  compliance  in  all
material respects with ERISA.

          (l)  Chief Executive Office.  Its chief executive office for
purposes  of  Article 9 of the UCC is located as specified  below
its name in Section 10.3.

                                
                           ARTICLE I V
                                
                      CONDITIONS PRECEDENT
                                
SECTION 4.     Do not remove this number

          SECTION 4.1.     Conditions to Closing.
          
               On  or prior to the date of execution hereof,  the
Transferor  shall  deliver to the Agent the following  documents,
instruments  and  fees,  all of which shall  be  in  a  form  and
substance acceptable to the Agent:

          (a)  A copy of the resolutions of the Board of Directors of the
Transferor  certified by its Secretary approving  the  execution,
delivery and performance by the Transferor of this Agreement, the
Receivables  Purchase Agreement to which it is a  party  and  the
other  Transaction  Documents to be delivered by  the  Transferor
hereunder or thereunder.

(b)  A copy of the resolutions of the Board of Directors of each
of the Seller and the Initial Purchaser, certified by its
Secretary, approving the execution, delivery and performance by
the Seller and the Initial Purchaser of this Agreement, the
Receivables Purchase Agreements and the other Transactions
Documents to be delivered by the Seller and the Initial Purchaser
hereunder or thereunder.
(c)  The Certificate of Incorporation of the Transferor certified
by the Secretary of State or other similar official of the
Transferor's jurisdiction of incorporation.
(d)  The Articles of Association of the Seller, certified by the
Seller's corporate secretary, and the Certificate of
Incorporation of the Initial Purchaser, certified by the
Secretary of State or other similar official of the Initial
Purchaser's jurisdiction of incorporation.
(e)  A Good Standing Certificate for the Transferor issued by the
Secretary of State or a similar official of the Transferor's
jurisdiction of incorporation, dated a date reasonably prior to
the Closing Date.
(f)  A Good Standing Certificate for the Initial Purchaser issued
by the Secretary of State or a similar official of its
jurisdiction of incorporation, dated a date reasonably prior to
the Closing Date.
(g)  A Certificate of an officer of the Transferor, Seller and
Initial Purchaser as to the truth of representations and
warranties on the Closing Date, and a certificate of the
Secretary of each of the Transferor, Seller and the Initial
Purchaser as to the incumbency of all officers signing
Transaction Documents on their behalf, with such attachments, and
including such other matters, as are requested by the Agent.
(h)  Copies of proper financing statements (Form UCC-1), dated a
date reasonably near to the date of the initial Incremental
Transfer naming the Transferor as the debtor in favor of the
Agent, for the benefit of the Company and the Bank Investors, as
secured party or other similar instruments or documents as may be
necessary or in the reasonable opinion of the Agent desirable
under the UCC of all appropriate jurisdictions or any comparable
law to perfect the Agent's undivided percentage interest in all
Receivables and Collections relating thereto.
(i)  Copies of proper financing statements (Form UCC-1), (x)
naming the Seller as the debtor in favor of the Initial Purchaser
as secured party, which were filed in respect of the Receivables
Purchase Agreement between such parties, and (y) dated a date
reasonably near to the date of the initial Incremental Transfer,
naming the Initial Purchaser as the debtor in favor of the
Transferor as secured party, or other similar instruments or
documents as may be necessary or in the reasonable opinion of the
Agent desirable under the UCC of all appropriate jurisdictions or
any comparable law to perfect the Transferor's and the Initial
Purchaser's ownership interest in all Receivables.
(j)  Copies of proper financing statements (Form UCC-3), if any,
necessary to terminate all security interests and other rights of
any person in Receivables previously granted by Transferor.
(k)  Copies of proper financing statements (Form UCC-3), if any,
necessary to terminate all security interests and other rights of
any person in Receivables previously granted by Mercantile, the
Seller or the Initial Purchaser.
(l)  Certified copies of request for information (Form UCC-11)
(or a similar search report certified by parties acceptable to
the Agent) dated a date reasonably near the date of the initial
Incremental Transfer listing all effective financing statements
which name the Transferor, the Seller or the Initial Purchaser
(under their respective present names and any previous names) as
debtor and which are filed in jurisdictions in which the filings
were made pursuant to items (h) or (i) above together with copies
of such financing statements (none of which shall cover any
Receivables or Accounts except for those referred to in clause
(i)(x) above).
(m)  An opinion of in-house counsel to the Transferor, the
Collection Agent, the Seller and the Initial Purchaser, covering
the matters requested by the Agent.
(n)  A copy of an executed notice to Bank of New York excluding
the Receivables from being conveyed pursuant to a certain
receivables purchase agreement between the Initial Purchaser and
Metris Receivables Inc.
(o)  An opinion of Faegre & Benson LLP, counsel to the Transferor
and the Initial Purchaser, covering certain bankruptcy and
insolvency matters (i.e. "true sale" and "non-consolidation").
(p)  An opinion of Van Cott, Bagley, Cornwall & McCarthy, special
Utah counsel to the Seller, as to the perfection and priority of
the security interest created under the Receivables Purchase
Agreement between the Seller and the Initial Purchaser.
          (q)  A letter addressed to the Agent from Dorsey & Whitney LLP,
updating and entitling the Agent to rely on their opinion of June
2,  1997  as  to  the  enforceability of  the  security  interest
referred to in clause (p) above notwithstanding any insolvency of
the Seller.

(r)  An opinion of Dorsey & Whitney LLP, counsel to the Initial
Purchaser and the Transferor, covering the perfection and
priority of security interests under this Agreement and the
Receivables Purchase Agreement between the Initial Purchaser and
the Transferor and the creation of security interests under the
Receivables Purchase Agreement between DMCCB and the Initial
Purchaser.
          (s)  A computer tape setting forth as of the Cut-Off Date all
Receivables and the Receivables balances thereon and  such  other
information as the Agent may reasonably request.

(t)  An executed copy of this Agreement, the Receivables Purchase
Agreements, the Fee Letter and each of the other Transaction
Documents to be executed by the Seller, the Initial Purchaser or
the Transferor.
(u)  The Transfer Certificate, duly executed by the Transferor.
(v)  The Certificate, duly executed by the Transferor and
appropriately completed.
(w)  An Agreement Fee to the Agent solely for its own account.
(x)  Evidence that the Spread Account has been established in
accordance with Section 2.12(b) hereof.
(y)  All documents pursuant to which the Receivables have been
sold by Mercantile to the Seller.
(z)  Such other documents, instruments, certificates and opinions
as the Agent shall reasonably request.
                                
                                
                                
                            ARTICLE V
                                
                            COVENANTS
                                
SECTION 5.

          SECTION 5.1.     Affirmative Covenants of Transferor.
          
               At  all times from the date hereof to the later to
occur  of (i) the Termination Date or (ii) the date on which  the
Net  Investment has been reduced to zero and all other  Aggregate
Unpaids  shall have been paid in full, in cash, unless the  Agent
shall otherwise consent in writing:

          (a)  Financial Reporting.

               The  Transferor will maintain, for itself and each
of  its  Subsidiaries,  a  system of accounting  established  and
administered in accordance with GAAP, and furnish or cause to  be
furnished to the Agent:

                    (i)  Annual Reporting.
          
                    Within one hundred (100) days after the close
          of   the  Initial  Purchaser's  fiscal  years,  audited
          financial statements, prepared in accordance with  GAAP
          on  a consolidated basis for the Initial Purchaser  and
          its  Subsidiaries,  in  each  case,  including  balance
          sheets as of the end of such period, related statements
          of  income  and cash flows, accompanied by  an  opinion
          (which  shall not be qualified in any material respect)
          of  a "Big Six" independent certified public accounting
          firm,  prepared  in accordance with generally  accepted
          auditing  standards  and  by  a  certificate  of   said
          accountants that, in the course of the foregoing,  they
          have obtained no knowledge of any Termination Event  or
          Potential  Termination Event, or if, in the opinion  of
          such  accountants, any Termination Event  or  Potential
          Termination Event shall exist, stating the  nature  and
          status thereof.
          
                    (ii) Quarterly Reporting.
          
                    Within fifty (50) days after the close of the
          first   three   quarterly  periods   of   the   Initial
          Purchaser's fiscal years, for the Initial Purchaser and
          its  Subsidiaries, in each case, consolidated unaudited
          balance sheets as at the close of each such period  and
          consolidated  related statements  of  income  and  cash
          flows  for the period from the beginning of such fiscal
          year  to  the end of such quarter, all as contained  in
          the  Initial Purchaser's filing with the Securities and
          Exchange Commission on Form 10-Q.
          
                    (iii)     Compliance Certificate.
          
                    Together   with   the  financial   statements
          required hereunder, a compliance certificate signed  by
          the Initial Purchaser's chief financial officer stating
          that  (x)  the attached financial statements have  been
          prepared in accordance with GAAP and accurately reflect
          the  financial  condition of the Initial Purchaser  and
          its  Subsidiaries and (y) to the best of such  Person's
          knowledge,   no   Termination   Event   or    Potential
          Termination  Event exists, or if any Termination  Event
          or  Potential  Termination Event  exists,  stating  the
          nature and status thereof.
          
                    (iv) Notice of Termination Events or Potential Termination
          Events.
          
                    As  soon as possible and in any event  within
          two  (2)  days after the occurrence of each Termination
          Event  or each Potential Termination Event, a statement
          of  the  chief  financial officer or  chief  accounting
          officer of the Transferor setting forth details of such
          Termination  Event or Potential Termination  Event  and
          the  action which the Transferor proposes to take  with
          respect thereto.
          
                    (v)  Change in Credit and Collection Policy and Debt 
         Ratings.
          
                    Within  five (5) days after the date  of  any
          change in the Transferor's, the Seller's or the Initial
          Purchaser's public or private debt ratings, if  any,  a
          written certification of the Transferor's, the Seller's
          or  the  Initial  Purchaser's public and  private  debt
          ratings after giving effect to any such change.
          
                    (vi) ERISA.
          
                    Promptly   after  the  filing  or   receiving
          thereof, copies of all reports and notices with respect
          to  any Reportable Event (as defined in Article  IV  of
          ERISA) which the Transferor, the Initial Purchaser, the
          Seller  or  any ERISA Affiliate of the Transferor,  the
          Initial Purchaser or the Seller files under ERISA  with
          the  Internal  Revenue  Service,  the  Pension  Benefit
          Guaranty Corporation or the U.S. Department of Labor or
          which the Transferor, the Initial Purchaser, the Seller
          or  any ERISA Affiliates of the Transferor, the Initial
          Purchaser,  or  the Seller receives from  the  Internal
          Revenue   Service,   the   Pension   Benefit   Guaranty
          Corporation or the U.S. Department of Labor.
          
                    (vii)     Other Information.
          
                    Such   other   information  (including   non-
          financial  information) as the Agent or the  Agent  may
          from  time  to time reasonably request with respect  to
          the  Seller,  the Initial Purchaser, the Transferor  or
          any Subsidiary of any of the foregoing.
          
          (b)  Conduct of Business.

               The  Transferor  will carry  on  and  conduct  its
business  in  substantially the same manner and in  substantially
the  same fields of enterprise as it is presently conducted,  and
will  do, and cause the Initial Purchaser and the Seller  to  do,
all   things  necessary  to  remain  duly  incorporated,  validly
existing  and in good standing as a domestic corporation  in  its
jurisdiction   of  incorporation  and  maintain   all   requisite
authority to conduct its business in each jurisdiction  in  which
its business is conducted.

          (c)  Compliance with Laws.

               The  Transferor will, and will cause each  of  the
Seller and the Initial Purchaser to, comply with all laws, rules,
regulations,  orders, writs, judgments, injunctions,  decrees  or
awards  to which it or its respective properties may be  subject,
where  the  failure  to  comply  with  the  foregoing  could   be
reasonably expected to have a Material Adverse Effect.

          (d)  Furnishing of Information and Inspection of Records.

               The  Transferor will, and will cause each  of  the
Seller and the Initial Purchaser, furnish to the Agent from  time
to  time such information with respect to the Receivables as  the
Agent  may  reasonably  request, including,  without  limitation,
listings identifying the Obligor and the outstanding balance  for
each Receivable.  The Transferor will, and will cause each of the
Seller and the Initial Purchaser to, at any time and from time to
time  during  regular business hours and after reasonable  notice
permit  the  Agent,  or  its agents or  representatives,  (i)  to
examine  and  make copies of and take abstracts from all  Records
and  (ii)  to visit the offices and properties of the Transferor,
the  Initial  Purchaser  or the Seller, as  applicable,  for  the
purpose  of  examining  such  Records,  and  to  discuss  matters
relating   to  Receivables  or  the  Transferor's,  the   Initial
Purchaser's or the Seller's performance hereunder and  under  the
other Transaction Documents to which such Person is a party  with
any  of  the officers, directors, employees or independent public
accountants  of  the  Transferor, the Initial  Purchaser  or  the
Seller, as applicable, having knowledge of such matters.

          (e)  Keeping of Records and Books of Account.

               The  Transferor will, and will cause  the  Initial
Purchaser   and   the   Seller   to,   maintain   and   implement
administrative  and  operating  procedures  (including,   without
limitation, an ability to recreate records evidencing Receivables
in  the  event of the destruction of the originals thereof),  and
keep  and  maintain,  all  documents, books,  records  and  other
information reasonably necessary or advisable for the  collection
of   all  Receivables  (including,  without  limitation,  records
adequate   to  permit  the  daily  identification  of  each   new
Receivable  and  all  Collections  of  and  adjustments  to  each
existing Receivable).

          (f)  Performance and Compliance with Receivables and Accounts.

               The  Transferor, at its expense,  will,  and  will
cause  the  Seller  and Initial Purchaser to,  timely  and  fully
perform  and  comply with all material provisions, covenants  and
other promises required to be observed by the Transferor, Initial
Purchaser  or  the  Seller  under the  Accounts  related  to  the
Receivables.

          (g)  Credit and Collection Policies.

               The  Transferor will, and will cause  the  Seller,
Initial  Purchaser and the Collection Agent to, comply  with  the
Credit and Collection Policy in regard to the Receivables and the
related  Accounts,  except insofar as any failure  to  so  comply
could not be reasonably expected to impair the collectibility  of
the  Receivables, on the whole, or a substantial amount  thereof,
or otherwise have a Material Adverse Effect.

          (h)  Collections Received.

               The  Transferor shall, and shall cause the  Seller
and  the  Collection  Agent  to,  hold  in  trust,  and  deposit,
immediately,  but  in any event not later than  forty-eight  (48)
hours  of  its  receipt  thereof, to the Collection  Account  all
Collections received from time to time by the Transferor, Initial
Purchaser  or the Seller, as the case may be, in accordance  with
Section 2.12(a).

          (i)  Sale Treatment.

               The  Transferor will not (i) and will  not  permit
the  Seller  or the Initial Purchaser to, account for  (including
for  accounting  and  tax  purposes),  or  otherwise  treat,  the
transactions contemplated by the Receivables Purchase  Agreements
in  any  manner other than as a sale of Receivables by the Seller
to  the  Initial  Purchaser or by the Initial  Purchaser  to  the
Transferor, or (ii) account for (other than for tax purposes)  or
otherwise  treat  the  transactions contemplated  hereby  in  any
manner  other than as a sale of Receivables by the Transferor  to
the  Agent  on  behalf of the Company or the Bank  Investors,  as
applicable.   In addition, the Transferor shall, and shall  cause
the  Seller and the Initial Purchaser to, disclose (in a footnote
or  otherwise)  in  all of their respective financial  statements
(including  any such financial statements consolidated  with  any
other Persons' financial statements) the existence and nature  of
the  transaction  contemplated  hereby  and  by  the  Receivables
Purchase  Agreements and the interest of the Transferor  (in  the
case  of  the Initial Purchaser's financial statements)  and  the
Agent,  on behalf of the Company and the Bank Investors,  in  the
Affected Assets.

          (j)  Separate Existence

               The  Transferor  shall at all  times  (a)  to  the
extent  the Transferor's office is located in the offices of  the
Seller  or any Affiliate of the Seller, pay fair market rent  for
its  executive office space located in the offices of the  Seller
or  any  Affiliate of the Seller, (b) have at all times at  least
two  members  of its board of directors which are  not  and  have
never been employees, officers or directors of the Seller or  any
Affiliate of the Seller or of any creditor of the Seller  or  any
Affiliate of the Seller and are persons who are familiar and have
experience   with   asset  securitization,   (c)   maintain   the
Transferor's books, financial statements, accounting records  and
other corporate documents and records separate from those of  the
Seller  or  any other entity and maintain separate accounts,  (d)
not commingle the Transferor's assets with those of the Seller or
any  other  entity,  (e)  act solely in its  corporate  name  and
through  its  own  authorized  officers  and  agents,  (f)   make
investments  directly  or  by brokers engaged  and  paid  by  the
Transferor or its agents (provided that if any such agent  is  an
Affiliate  of the Transferor it shall be compensated  at  a  fair
market  rate  for  its  services),  (g)  separately  manage   the
Transferor's  liabilities  from  those  of  the  Seller  or   any
Affiliates  of the Seller and pay its own liabilities,  including
all administrative expenses, from its own separate assets, except
that  the  Seller   may pay the organizational  expenses  of  the
Transferor,  (h) pay from the Transferor's assets all obligations
and  indebtedness of any kind incurred by the Transferor, and (i)
take  no  actions  which  may mislead third  parties  as  to  the
separate corporate identities and separate assets and liabilities
of  the  Seller,  the Initial Purchaser and the Transferor.   The
Transferor  shall  abide by all corporate formalities,  including
the maintenance of current minute books, and the Transferor shall
cause its financial statements to be prepared in accordance  with
generally  accepted  accounting  principles  in  a  manner   that
indicates the separate existence of the Transferor and its assets
and   liabilities.   The  Transferor  shall  (i)  pay   all   its
liabilities,  (ii) not assume the liabilities of the  Seller   or
any  Affiliate  of  the Seller, (iii) not lend  funds  or  extend
credit  to the Seller except pursuant to the Receivables Purchase
Agreements   in  connection  with  the  purchase  of  Receivables
thereunder  and (iv) not guarantee the liabilities of the  Seller
or  any Affiliates of the Seller.  The officers and directors  of
the Transferor (as appropriate) shall make decisions with respect
to   the   business  and  daily  operations  of  the   Transferor
independent  of and not dictated by any controlling entity.   The
Transferor shall not engage in any business not permitted by  its
Certificate of Incorporation.

          (k)  Corporate Documents.

               The Transferor shall only amend, alter, change  or
repeal  its  Certificate  of Incorporation  and  the  Receivables
Purchase Agreements with the prior written consent of the  Agent,
which consent shall not be unreasonably withheld.

          (l)  Payment to the Initial Purchaser.

               With respect to any Receivable sold by the Initial
Purchaser  to  the  Transferor, the Transferor shall,  and  shall
cause  the  Initial  Purchaser to, effect such  sale  under,  and
pursuant  to  the  terms of, the applicable Receivables  Purchase
Agreement,  including, without limitation,  the  payment  by  the
Transferor to the Initial Purchaser and by the Initial  Purchaser
to  the  Seller  of  the purchase price for  such  Receivable  as
required  by  the  terms of the applicable  Receivables  Purchase
Agreement.

          SECTION 5.2.     Negative Covenants of the Transferor.
          
               At  all times from the date hereof to the later to
occur  of (i) the Termination Date or (ii) the date on which  the
Net  Investment has been reduced to zero and all other  Aggregate
Unpaids  shall have been paid in full, in cash, unless the  Agent
shall otherwise consent in writing:

          (a)  No Sales, Liens, Etc.

               Except  as  otherwise provided herein and  in  the
Receivables  Purchase Agreements, the Transferor  will  not,  and
will  not  permit the Initial Purchaser or the Seller  to,  sell,
assign  (by  operation of law or otherwise) or otherwise  dispose
of,  or create or suffer to exist any Adverse Claim upon (or  the
filing of any financing statement) or with respect to any of  the
Affected Assets, or assign any right to receive income in respect
thereof.

          (b)  No Extension or Amendment of Receivables.

               Except  as  otherwise  permitted  in  Section  6.2
hereof,  the Transferor will not, and will not permit the  Seller
to,   extend,  amend  or  otherwise  modify  the  terms  of   any
Receivable,  or amend, modify or waive any term or  condition  of
any  Account  related thereto.  The Transferor further  covenants
that, except as otherwise required by law (or as is deemed by the
Seller  to  be  necessary in order to maintain  its  credit  card
business  on  a competitive basis), it shall not, and  shall  not
cause  or  otherwise permit the Collection Agent at any  time  to
reduce the periodic finance charges assessed on any Receivable or
other fees on any Account if, as a result of such reduction,  the
reasonable expectation of the Net Portfolio Yield as of such date
would  be less than 2.00% and unless (i) such reduction  is  made
applicable  to  the comparable segment of the consumer  revolving
credit  accounts owned and serviced by the Collection Agent  that
have  characteristics the same as, or substantially  similar  to,
the  Accounts that are the subject of such change or (ii)  if  it
does not own such a comparable segment, it will not make any such
change  with  the  intent to materially benefit itself  over  the
Company and the Bank Investors.

          (c)  No Change in Business or Credit and Collection Policy.

               The  Transferor will not make any  change  in  the
character of its business or in the Credit and Collection Policy,
which change would, in either case, impair the collectibility  of
the Receivables or otherwise have a Material Adverse Effect.

          (d)  No Mergers, Etc.

               The  Transferor will not, and except as  otherwise
permitted  pursuant to the Receivables Purchase Agreements,  will
not  permit the Seller to, (i) consolidate or merge with or  into
any  other  Person,  or  (ii) sell,  lease  or  transfer  all  or
substantially  all of its assets to any other Person  unless  (a)
the   Transferor  or  Seller,  respectively,  is  the   surviving
corporation,  or the entity or Person formed by or surviving  any
such  consolidation or merger (if other than  the  Transferor  or
Seller,  respectively) or to which such sale, lease  or  transfer
shall have been made is a corporation organized or existing under
the  laws of the United States, any state thereof or the District
of  Columbia; (b) the entity or Person formed by or surviving any
such  consolidation or merger (if other than  the  Transferor  or
Seller, respectively) or the entity or Person to which such sale,
lease,  or  transfer  shall  have  been  made  assumes  all   the
obligations of the Transferor or Seller, respectively, under this
Agreement  and  the other Transaction Documents  pursuant  to  an
agreement  in form and substance satisfactory to the  Agent;  and
(c)  immediately after such transaction, no Potential Termination
Event or Termination Event exists.

          (e)  Change of Name, Etc.

               The  Transferor will not, and will not permit  the
Seller to, change its name, identity or structure or the location
of  its chief executive office, unless at least 10 days prior  to
the  effective  date  of any such change the  Transferor  or  the
Seller,  as  applicable, delivers to the  Agent  such  documents,
instruments  or  agreements, executed by the  Transferor  or  the
Seller,  as  applicable, as are necessary to reflect such  change
and to continue the perfection of the Agent's ownership interests
or security interests in the Affected Assets.

          (f)  Amendment to Receivables Purchase Agreements.

               The  Transferor will not, and will not permit  the
Seller  to, amend, modify, or supplement the Receivables Purchase
Agreements  or waive any provision thereof, in each  case  except
with  the prior written consent of the Agent (which shall not  be
unreasonably withheld); nor shall the Transferor take, or  permit
the  Seller  to  take,  any other action  under  the  Receivables
Purchase Agreements that shall have a material adverse affect  on
the  Agent,  the  Company  or  any  Bank  Investor  or  which  is
inconsistent with the terms of this Agreement.

          (g)  Other Debt.

               Except as provided for herein, the Transferor will
not  create,  incur, assume or suffer to exist  any  indebtedness
whether current or funded, or any other liability other than  (i)
indebtedness  of the Transferor representing fees,  expenses  and
indemnities  arising hereunder or under the Receivables  Purchase
Agreement to which it is a party for the purchase price  of  such
Receivables  under the Receivables Purchase Agreements  or  under
the   Transfer  and  Administration  Agreement,   dated   as   of
September  23,  1997, among the parties hereto,  and  (ii)  other
indebtedness incurred in the ordinary course of its  business  in
an amount not to exceed $9,750 at any time outstanding.

          (h)  ERISA Matters.

               The  Transferor will not, and will not permit  the
Seller  or the Initial Purchaser to, (i) engage or permit any  of
its  respective  ERISA  Affiliates to engage  in  any  prohibited
transaction  (as defined in Section 4975 of the Code and  Section
406  of ERISA) for which an exemption is not available or has not
previously been obtained from the U.S. Department of Labor;  (ii)
permit to exist any accumulated funding deficiency (as defined in
Section  302(a)  of  ERISA and Section 412(a)  of  the  Code)  or
funding deficiency with respect to any Benefit Plan other than  a
Multiemployer  Plan;  (iii) fail to  make  any  payments  to  any
Multiemployer Plan that the Transferor, the Seller,  the  Initial
Purchaser  or any ERISA Affiliate of the Transferor, the  Initial
Purchaser  or the Seller is required to make under the  agreement
relating  to  such  Multiemployer  Plan  or  any  law  pertaining
thereto; (iv) terminate any Benefit Plan so as to result  in  any
liability;  or  (v)  permit  to  exist  any  occurrence  of   any
reportable  event described in Title IV of ERISA which represents
a material risk of a liability to the Transferor, the Seller, the
Initial  Purchaser or any ERISA Affiliate of the Transferor,  the
Initial Purchaser or the Seller under ERISA or the Code.

          (i)  Performance of Account Agreements.

               The Transferor shall not, and shall not permit the
Seller  to fail to comply with and perform its obligations  under
the  applicable Account Agreements relating to the  Accounts  and
the  Credit  and  Collection Policy except insofar  as  any  such
failure  to comply or perform would not materially and  adversely
affect the rights of the Company, the Agent, or any Bank Investor
in the Receivables or the collectibility of the Receivables.  The
Transferor  shall  not  change the terms and  provisions  of  the
Account  Agreement  or the Credit and Collection  Policy  in  any
respect  (including, without limitation, the calculation  of  the
amount,  and the timing, of uncollectible Receivables)  with  the
intent  to materially benefit itself over the Company, the Agent,
or  any Bank Investor, unless such change does not materially and
adversely affect the rights of the Company, the Agent or any Bank
Investor  in  the  Receivables  or  the  collectibility  of   the
Receivables.

          SECTION 5.3.     Affirmative Covenants of the Collection Agent.
          
               At  all times from the date hereof to the later to
occur  of (i) the Termination Date or (ii) the date on which  the
Net  Investment has been reduced to zero and all other  Aggregate
Unpaids  shall have been paid in full, in cash, unless the  Agent
shall otherwise consent in writing:

          (a)  Conduct of Business.

               The  Collection Agent shall carry on  and  conduct
its   business   in  substantially  the  same   manner   and   in
substantially  the same fields of enterprise as it  is  presently
conducted  and do all things necessary to remain duly  chartered,
validly  existing  and  in good standing as  a  national  banking
association  and maintain all requisite authority to conduct  its
business in each jurisdiction in which its business is conducted.

          (b)  Compliance with Laws.

               The  Collection Agent shall comply with all  laws,
rules,   regulations,  orders,  writs,  judgments,   injunctions,
decrees or awards to which it or its respective properties may be
subject  which pertain to its duties hereunder and shall maintain
in  effect all material qualifications required by law to service
the Receivables and Accounts properly.

          (c)  Furnishing of Information and Inspection of Records.

               The  Collection Agent shall furnish to  the  Agent
from   time  to  time  such  information  with  respect  to   the
Receivables  as  the  Agent  may reasonably  request,  including,
without  limitation,  listings identifying the  Obligor  and  the
outstanding  balance for each Receivable.  The  Collection  Agent
shall,  at any time and from time to time during regular business
hours  and upon reasonable notice permit the Agent, or its agents
or  representatives, (i) to examine and make copies of  and  take
abstracts  from  all Records and (ii) to visit  the  offices  and
properties  of the Collection Agent for the purpose of  examining
such  Records, and to discuss matters relating to Receivables  or
the  Transferor's, the Seller's, the Initial Purchaser's  or  the
Collection  Agent's  performance hereunder and  under  the  other
Transaction Documents to which such Person is a party with any of
the   officers,   directors,  employees  or  independent   public
accountants  of  the Collection Agent having  knowledge  of  such
matters.

          (d)  Keeping of Records and Books of Account.

               The  Collection Agent shall maintain and implement
operating  procedures (including, without limitation, an  ability
to  recreate  records evidencing Receivables in the event of  the
destruction of the originals thereof), and keep and maintain, all
documents,   books,  records  and  other  information  reasonably
necessary  or  advisable for the collection  of  all  Receivables
(including,  without limitation, records adequate to  permit  the
daily  identification of each new Receivable and all  Collections
of and adjustments to each existing Receivable).

          (e)  [Reserved]

(f)  Credit and Collection Policies.
               The  Collection Agent shall comply with the Credit
and  Collection  Policy  in regard to the  Receivables  and  each
related Account, except insofar as any failure to so comply could
not  be  reasonably expected to impair the collectibility of  the
Receivables,  on the whole, or a substantial amount  thereof,  or
otherwise have a Material Adverse Effect.

          (g)  No Rescission or Cancellation.

               The Collection Agent shall not permit any
rescission or cancellation of a Receivable except as ordered by a
court of competent jurisdiction or other governmental authority
or in the ordinary course of its business and in accordance with
the Credit and Collection Policy.

          (h)  Protection of Company's Rights

               The Collection Agent shall take no action, nor
omit to take any action, which would impair the rights of the
Company in the Receivables or the related Accounts.

          SECTION 5.4.     Negative Covenants of the Collection Agent.
          
               At  all times from the date hereof to the later to
occur  of (i) the Termination Date or (ii) the date on which  the
Net  Investment has been reduced to zero and all other  Aggregate
Unpaids  shall have been paid in full, in cash, unless the  Agent
shall otherwise consent in writing.

          (a)  No Sales, Liens, Etc.

               Except   as   otherwise   provided   herein,   the
Collection Agent shall not sell, assign (by operation of  law  or
otherwise) or otherwise dispose of, or create or suffer to  exist
any Adverse Claim upon (or the filing of any financing statement)
or  with  respect to (x) any of the Affected Assets  or  (y)  any
account  to which any Collections of any Receivable are sent,  or
assign any right to receive income in respect thereof.

          (b)  No Change in Business or Credit Collection Policy.

               The Collection Agent shall not make any change  in
the  character  of its business or in the Credit  and  Collection
Policy,   which  change  would,  in  either  case,   impair   the
collectibility  of  the Receivables, on the whole,  or  otherwise
have a Material Adverse Effect.

          (c)  No Extension or Amendment of Receivables.

               Except  as  otherwise  permitted  in  Section  6.2
hereof, the Collection Agent shall not extend, amend or otherwise
modify the terms of any Receivable, or amend, modify or waive any
term or condition of any Account related thereto.

          (d)  No Mergers, Etc.

               The Collection Agent shall not (i) consolidate  or
merge  with  or  into any other Person, or (ii)  sell,  lease  or
transfer  all  or substantially all of its assets  to  any  other
Person,   unless  (a)  the  Collection  Agent  is  the  surviving
corporation,  or the entity or Person formed by or surviving  any
such consolidation or merger (if other than the Collection Agent)
or  to which such sale, lease or transfer shall have been made is
a  corporation organized or existing under the laws of the United
States,  any state thereof or the District of Columbia;  (b)  the
entity or Person formed by or surviving any such consolidation or
merger  (if  other than the Collection Agent) or  the  entity  or
Person to which such sale, lease or transfer shall have been made
assumes  all the obligations of the Collection Agent  under  this
Agreement  and  the other Transaction Documents  pursuant  to  an
agreement  in form and substance satisfactory to the  Agent;  and
(c)  immediately after such transaction, no Potential Termination
Event or Termination Event exists.

                                
                                
                                
                           ARTICLE VI
                                
                 ADMINISTRATION AND COLLECTIONS
                                
SECTION 6.

          SECTION 6.1.     Appointment of Collection Agent.
          
               The servicing, administering and collection of the
Receivables  shall be conducted by such Person  (the  "Collection
Agent")  so designated from time to time in accordance with  this
Section 6.1.  Until the Company gives notice to the Seller of the
designation  of  a new Collection Agent, under the  circumstances
set  forth below, the Seller is hereby designated as, and  hereby
agrees  to  perform the duties and obligations of, the Collection
Agent pursuant to the terms hereof.  The Collection Agent may not
delegate  any  of  its  material rights,  duties  or  obligations
hereunder  without  prior  notice to the  Agent  or  designate  a
substitute Collection Agent, without the prior written consent of
the  Agent, and provided that in all events the Collection  Agent
shall continue to remain solely liable for the performance of the
duties  as  Collection Agent hereunder notwithstanding  any  such
delegation  hereunder.  The Agent may, and upon the direction  of
the Majority Investors the Agent shall, after the occurrence of a
Collection Agent Default or any other Termination Event designate
as  Collection Agent any Person (including itself) to succeed the
Seller  or  any successor Collection Agent, on the  condition  in
each  case  that  any such Person so designated  shall  agree  to
perform  the  duties  and  obligations of  the  Collection  Agent
pursuant  to the terms hereof.  The Agent may notify any  Obligor
of the Transferred Interest.

          SECTION 6.2.     Duties of Collection Agent.
          
          (a)  The Collection Agent shall take or cause to be taken all
such  action  as  may be necessary or advisable to  collect  each
Receivable  from time to time, all in accordance with  applicable
laws,  rules and regulations, with reasonable care and diligence,
and in accordance with the Credit and Collection Policy.  Each of
the  Transferor,  the Company, the Agent and the  Bank  Investors
hereby  appoints as its agent the Collection Agent, from time  to
time  designated pursuant to Section 6.1 hereof, to  enforce  its
respective rights and interests in and under the Affected Assets.
To the extent permitted by applicable law, each of the Transferor
and the Seller (to the extent not then acting as Collection Agent
hereunder)  hereby  grants  to  any  Collection  Agent  appointed
hereunder  an irrevocable power of attorney to take any  and  all
steps  in the Transferor's and/or the Seller's name and on behalf
of  the  Transferor or the Seller necessary or desirable, in  the
reasonable determination of the Collection Agent, to collect  all
amounts  due  under  any and all Receivables, including,  without
limitation,  endorsing the Transferor's and/or the Seller's  name
on  checks  and  other instruments representing  Collections  and
enforcing  such  Receivables and the related Account  Agreements.
The  Collection  Agent shall set aside for  the  account  of  the
Transferor and the Agent their respective allocable shares of the
Collections  of Receivables in accordance with Sections  2.5  and
2.6 hereof.  The Collection Agent shall segregate and deposit  to
the Agent's account the Agent's allocable share of Collections of
Receivables  when required pursuant to Article  II  hereof.   The
Transferor  shall  deliver  to  the  Collection  Agent   or   its
designee(s) and the Collection Agent or its designees shall  hold
in  trust  for  the Transferor and the Agent, on  behalf  of  the
Company  and  the  Bank  Investors,  in  accordance  with   their
respective  interests, all Records which evidence  or  relate  to
Receivables.  The Collection Agent shall not make the Agent,  the
Company  or  any of the Bank Investors a party to any  litigation
without the prior written consent of such Person.

(b)  The Collection Agent shall, as soon as practicable following
receipt thereof, turn over to the Transferor any collections of
any indebtedness of any Person which is not on account of a
Receivable.  If the Collection Agent is not the Transferor or the
Seller or an Affiliate of the Transferor or the Seller, the
Collection Agent, by giving three Business Days' prior written
notice to the Agent, may revise the percentage used to calculate
the Servicing Fee so long as the revised percentage will not
result in a Servicing Fee that exceeds 110% of the reasonable and
appropriate out-of-pocket costs and expenses of such Collection
Agent incurred in connection with the performance of its
obligations hereunder as documented to the reasonable
satisfaction of the Agent; provided, however, that at any time
after the Buyer's Percentage Factor equals or exceeds 100%, any
compensation to the Collection Agent in excess of the Servicing
Fee initially provided for herein shall be an obligation of the
Transferor and shall not be payable, in whole or in part, from
Collections allocated to the Company or the Bank Investors, as
applicable.  The Collection Agent, if other than the Transferor
or the Seller or an Affiliate of the Transferor or the Seller,
shall as soon as practicable upon demand, deliver to the Seller
all Records in its possession which evidence or relate to
indebtedness of an Obligor which is not a Receivable.
(c)  On or before 100 days after the end of each fiscal year of
the Collection Agent, beginning with the fiscal year ending
December 31, 1998, the Collection Agent shall cause a firm of
nationally recognized independent public accountants (who may
also render other services to the Collection Agent, the
Transferor, the Seller or any Affiliates of any of the foregoing)
to furnish a report to the Agent to the effect that they have (i)
applied certain procedures, agreed upon with the Collection Agent
and the Agent and substantially as set forth in Exhibit C hereto,
which would re-perform certain accounting procedures performed by
the Collection Agent pursuant to certain documents and records
relating to the servicing of the Accounts under this Agreement;
in addition, each report shall set forth the agreed upon
procedures performed and the results of such procedures; and (ii)
compared the amounts and percentages set forth in the Investor
Reports forwarded by the Collection Agent pursuant to Section
2.11 during the period covered by such report with the computer
reports (which may include personal computer generated reports
that summarize data from the computer reports generated by either
the Transferor or Collection Agent which are used to prepare the
Investor Reports) which were the source of such amounts and
percentages and that on the basis of such comparison, such
amounts and percentages are in agreement except as shall be set
forth in such report.
(d)  Notwithstanding anything to the contrary contained in this
Article VI, the Collection Agent, if not the Transferor, the
Seller or any Affiliate of the Transferor or the Seller, shall
have no obligation to collect, enforce or take any other action
described in this Article VI with respect to any indebtedness
that is not included in the Transferred Interest other than to
deliver to the Transferor the collections and documents with
respect to any such indebtedness as described in Section 6.2(b)
hereof.
          SECTION 6.3.     Rights After Designation of New Collection
          Agent.
          
          At  any  time following the designation of a Collection
Agent (other than the Transferor, the Seller or any Affiliate  of
the Transferor or the Seller) pursuant to Section 6.1 hereof:

                    (i)  The Agent may direct that payment of all amounts 
          payable under any Receivable be made directly to the Agent or its
          designee.
          
(ii) In the event that a Termination Event has occurred, the
Transferor shall, at the Agent's request and at the Transferor's
expense, direct that payments be made directly by each Obligor to
the Agent or its designee, and, if necessary, give notice of the
Agent's, the Transferor's and/or the Bank Investors' ownership of
Receivables to each Obligor.
(iii)     The Transferor shall, at the Agent's request, (A)
assemble all of the Records, and shall make the same available to
the Agent or its designee at a place selected by the Agent or its
designee, and (B) segregate all cash, checks and other
instruments received by it from time to time constituting
Collections of Receivables in a manner acceptable to the Agent
and shall, promptly upon receipt, remit all such cash, checks and
instruments, duly endorsed or with duly executed instruments of
transfer, to the Agent or its designee.
(iv) The Transferor and the Seller  hereby authorize the Agent to
take any and all lawful steps in the Transferor's or Seller's
name and on behalf of the Transferor and the Seller  necessary or
desirable and reasonable, in the determination of the Agent, to
collect all amounts due under any and all Receivables, including,
without limitation, endorsing the Transferor's or Seller's name
on checks and other instruments representing Collections and
enforcing such Receivables and the related Account Agreements,
and the Transferor and the Seller shall request any third party
holding any Records to provide the Agent with access to such
Records to same extent as the Transferor and Seller have such
access.
          SECTION 6.4.     Collection Agent Default.
          
               The occurrence of any one or more of the following
events shall constitute a Collection Agent Default:

          (a)  the Collection Agent or, to the extent that the Transferor,
the  Seller  or any Affiliate of the Transferor, the Seller,  the
Initial  Purchaser  is  then  acting  as  Collection  Agent,  the
Transferor, the Seller, the Initial Purchaser or such  Affiliate,
as  applicable,  shall fail to (i) observe or perform  any  term,
covenant  or agreement to be observed or performed under  Section
5.3(a),  (f), (g) or (h) or Section 5.4(b), (c) or (d),  and  any
such   failure  to  observe  Section  5.3(a),  (g)  or   (h)   or
Section  5.4(c)  shall have a Material Adverse  Effect,  or  (ii)
observe  or  perform  any term, covenant or  agreement  hereunder
(other than as referred to in clause (i) or (iii) of this Section
6.4(a)) or under any of the other Transaction Documents to  which
such  Person  is a party or by which such Person is bound,  which
failure  shall  have a Material Adverse Effect and  shall  remain
unremedied  for  ten  (10) days, or (iii)  make  any  payment  or
deposit  required  to be made by it hereunder  when  due  or  the
Collection  Agent  shall fail to observe  or  perform  any  term,
covenant  or  agreement  on the Collection  Agent's  part  to  be
performed under Section 2.8(b) hereof; or

          (b)  any representation, warranty, certification or statement
made  by  the Collection Agent (in the event that the Transferor,
the  Seller  or  such Affiliate is then acting as the  Collection
Agent) in this Agreement, the Receivables Purchase Agreements  or
in  any  of the other Transaction Documents or in any certificate
or  report delivered by it pursuant to any of the foregoing shall
prove to have been incorrect in any material adverse respect when
made or deemed made; or

(c)  any event of default by the Collection Agent or any of its
Subsidiaries in the performance of any term, provision or
condition contained in any agreement under which any Indebtedness
greater than $10,000,000 was created or is governed, if the
effect of such event of default is to cause that Indebtedness to
become or be declared due and payable prior to its stated
maturity or the stated maturity of any underlying obligation, as
the case may be;  or
(d)  any Event of Bankruptcy shall occur with respect to the
Collection Agent or any of its Subsidiaries; or
(e)  there shall have occurred any material adverse change in the
operations of the Collection Agent since the end of the last
fiscal year ending prior to the date of its appointment as
Collection Agent hereunder or any other event shall have occurred
which, in the commercially reasonable judgment of the Agent,
materially and adversely affects the Collection Agent's ability
to either collect the Receivables or to perform under this
Agreement.
          SECTION 6.5.     Responsibilities of the Transferor and the
          Seller.
          
               Anything  herein  to the contrary notwithstanding,
the  Transferor  shall, and/or shall cause  the  Seller  to,  (i)
perform  all  of  the  Seller's obligations  under  the  Accounts
related to the Receivables to the same extent as if interests  in
such  Receivables  had  not been sold  hereunder  and  under  the
Receivables  Purchase Agreements and the exercise by  the  Agent,
the  Company and the Bank Investors of their rights hereunder and
under  the Receivables Purchase Agreements shall not relieve  the
Transferor or the Seller from such obligations and (ii) pay  when
due  any  taxes,  including without limitation, any  sales  taxes
payable in connection with the Receivables and their creation and
satisfaction.  Neither the Agent, the Company nor any of the Bank
Investors shall have any obligation or liability with respect  to
any Receivable or related Accounts, nor shall it be obligated  to
perform any of the obligations of the Seller thereunder.

                                
                                
                                
                                
                           ARTICLE VII
                                
                       TERMINATION EVENTS
                                
SECTION 7.

          SECTION 7.1.     Termination Events.
          
               The occurrence of any one or more of the following
events shall constitute a Termination Event:

          (a)  the Transferor, the Seller, the Initial Purchaser or the
Collection Agent shall fail to make any payment or deposit to  be
made by it hereunder or under the Receivables Purchase Agreements
when due hereunder or thereunder, and such failure shall continue
for 2 Business Days; or

          (b)  any representation, warranty, certification or statement
made  by  the Transferor in this Agreement, any other Transaction
Document  to  which  it  is  a party or  in  any  other  document
delivered  pursuant hereto or thereto shall prove  to  have  been
incorrect  in  any material adverse respect when made  or  deemed
made and, if susceptible of being remedied, has not been remedied
within 30 days thereafter; or

(c)  the Transferor, or the Collection Agent, shall default in
the performance of any payment, covenant or undertaking (other
than those covered by clause (a) above) (i) to be performed or
observed under Sections 5.1(a)(vi), 5.1(a)(vii), 5.1(b), 5.1(f),
5.1(g), 5.1(i), 5.1(k), 5.1(l), 5.2(a), (c), (d) or (g) or
Section 5.3 or (ii) to be performed or observed under any other
provision hereof and such default in the case of this clause (ii)
shall continue for ten (10) days; or
(d)  any event of default by the Transferor, the Seller, the
Initial Purchaser or any Subsidiary of the Transferor, the
Seller, or the Initial Purchaser in the performance of any term,
provision or condition contained in any agreement to which any
such Person is a party or under which any Indebtedness owing by
the Transferor, the Seller, the Initial Purchaser or any
Subsidiary of the Transferor, the Initial Purchaser or the Seller
greater than $10,000,000 was created or is governed if the effect
of such event of default is to cause that Indebtedness to become
or be declared due and payable prior to its stated maturity or
the stated maturity of any underlying obligation, as the case may
be; or
(e)  any Event of Bankruptcy shall occur with respect to FCI
(provided that it continues to own 25% or more of the voting
stock of the Initial Purchaser), the Transferor, the Initial
Purchaser, the Seller or any Subsidiary of any of the foregoing;
or
(f)  the Transferor shall, for any reason, fail to have a valid
ownership interest in the Receivables or the Agent, on behalf of
the Company and the Bank Investors, shall, for any reason, fail
or cease to have a valid and perfected first priority ownership
or security interest in the Affected Assets free and clear of any
Adverse Claims; or
(g)  a Collection Agent Default shall have occurred; or
(h)  (x) either of the Receivables Purchase Agreements shall have
terminated or (y) a default shall occur under either of the
Receivables Purchase Agreements which has a Material Adverse
Effect; or
(i)  the Transferor, the Collection Agent, the Initial Purchaser,
or the Seller shall enter into any transaction or merger whereby
it is not the surviving entity; or
(j)  there shall have occurred any material adverse change in the
operations of the Transferor or the Seller July 29, 1997 or any
other Material Adverse Effect shall have occurred; or
(k)  the Liquidity Provider or the Credit Support Provider shall
have given notice that an event of default has occurred and is
continuing under any of its respective agreements with the
Company; or
(l)  the Company's short-term unsecured debt shall not be rated
at least "A-2" by Standard & Poor's and at least "P-2" by
Moody's, respectively; or
(m)  on any date (i) the Buyer's Percentage Factor shall exceed
the Maximum Buyer's Percentage Factor and shall not be cured
within one Business Day thereafter, (ii) the Buyer's Percentage
Factor shall equal or exceed 100% at any time or (iii) the Net
Investment plus, in the case where the Transferred Interest is
held by the Company, the Interest Component of all outstanding
Related Commercial Paper, shall exceed the Facility Limit; or
(n)  the Spread Account balance shall be less than the Spread
Account Cap Percentage Amount on any Remittance Date and such
deficiency shall continue to exist unremedied at the close of
business on the next Remittance Date; or
(o)  the Net Portfolio Yield averaged for any three consecutive
Collection Periods shall be less than 2%; or
(p)  the Initial Purchaser shall at any time cease to own,
directly or indirectly, all of the outstanding capital stock of
the Seller; or
          (q)  any failure by FCI or any of its Affiliates (other than the
Initial  Purchaser and its Subsidiaries) to maintain its  Benefit
Plans in accordance with ERISA or the occurrence of any event  of
the  type set forth in clauses (i) through (v) of Section  5.2(h)
with respect to any such entity which, in any case, results in  a
lien  on  the  Receivables or otherwise has  a  Material  Adverse
Effect.

          
          
          SECTION 7.2.   Termination.
          
          (a)  Upon the occurrence of any Termination Event the Agent may,
or at the direction of the Majority Investors shall, by notice to
the  Transferor and the Collection Agent declare the  Termination
Date to have occurred; provided, however, that in the case of any
event  described  in  Section 7.1(f), 7.1(m)(ii)  or  7.1(m)(iii)
above,  the  Termination Date shall be deemed  to  have  occurred
automatically upon the occurrence of such event.  Upon  any  such
declaration  or  automatic occurrence, the Agent shall  have,  in
addition to all other rights and remedies under this Agreement or
otherwise, all other rights and remedies provided under  the  UCC
of  the  applicable  jurisdiction  (except,  in  the  case  of  a
Termination Event under clause (k) or (l), the right  to  re-sell
the Receivables at a foreclosure sale) and other applicable laws,
all of which rights shall be cumulative.

(b)  At all times after the declaration or automatic occurrence
of the Termination Date pursuant to Section 7.2(a), Carrying
Costs shall thereafter be calculated on the basis of  the Base
Rate plus 2.00%.
                                
                                
                                
                          ARTICLE VIII
                                
           INDEMNIFICATION; EXPENSES; RELATED MATTERS
SECTION 8.

          SECTION 8.1.     Indemnities by the Transferor.
               Without limiting any other rights which the Agent,
the  Company  or the Bank Investors may have hereunder  or  under
applicable  law  each of the Transferor and the Collection  Agent
hereby  severally  agrees  to indemnify  the  Company,  the  Bank
Investors,  the  Agent,  the  Collateral  Agent,  the   Liquidity
Provider  and the Credit Support Provider and any successors  and
permitted  assigns and their respective officers,  directors  and
employees (collectively, "Indemnified Parties") from and  against
any  and  all  damages,  losses, claims, liabilities,  costs  and
expenses,  including,  without limitation, reasonable  attorneys'
fees  (which  such  attorneys may be employees of  the  Liquidity
Provider,  the  Credit  Support  Provider,  the  Agent   or   the
Collateral  Agent, as applicable) and disbursements (all  of  the
foregoing   being   collectively  referred  to  as   "Indemnified
Amounts")  awarded  against or incurred by any  of  them  in  any
action   or  proceeding  between  the  Transferor,  the   Initial
Purchaser  or  the  Seller (including, in  its  capacity  as  the
Collection  Agent,  except  for indemnification  which  is  being
sought  against the Collection Agent) and any of the  Indemnified
Parties  or between any of the Indemnified Parties and any  third
party  or  otherwise  arising out of  or  as  a  result  of  this
Agreement,  the  other Transaction Documents,  the  ownership  or
maintenance,  either directly or indirectly, by  the  Agent,  the
Company or any Bank Investor of the Transferred Interest  or  any
of   the  other  transactions  contemplated  hereby  or  thereby,
excluding,  however,  (i)  Indemnified  Amounts  to  the   extent
resulting from gross negligence or willful misconduct on the part
of  an  Indemnified Party or (ii) recourse (except  as  otherwise
specifically   provided  in  this  Agreement)  for  uncollectible
Receivables.  Notwithstanding the foregoing, the indemnity of the
Collection  Agent pursuant to this Section shall  be  limited  to
Indemnified  Amounts relating to or resulting  from  any  of  the
following  which relate to the Collection Agent  or  the  Seller,
whether  in  its  individual capacity  or  as  Collection  Agent.
Without  limiting the generality of the foregoing, the Transferor
shall  indemnify  each Indemnified Party for Indemnified  Amounts
relating to or resulting from all matters set forth below  (other
than those described in the preceding sentence):

                    (i)  any representation or warranty made by the Transferor,
          Initial Purchaser or the Seller (including, in its capacity as
          the Collection Agent) or any officers of the Transferor, the
          Initial Purchaser or the Seller (including, in its capacity as
          the Collection Agent) under or in connection with this Agreement,
          the Receivable Purchase Agreements, any of the other Transaction
          Documents, any Investor Report or any other information or report
          delivered by the Transferor, Seller or the Collection Agent
          pursuant hereto, which shall have been false or incorrect in any
          material respect when made or deemed made;
          
(ii) the failure by the Transferor, the Initial Purchaser or the
Seller (including, in its capacity as the Collection Agent) to
comply with any applicable law, rule or regulation with respect
to any Receivable or the related Account, or the nonconformity of
any Receivable or the related Account with any such applicable
law, rule or regulation;
(iii)     the failure (x) to vest and maintain vested in the
Agent, on behalf of the Company and the Bank Investors, an
undivided first priority, perfected percentage ownership interest
(to the extent of the Transferred Interest) in the Affected
Assets free and clear of any Adverse Claim or (y) to create or
maintain a valid and perfected first priority security interest
in favor of the Agent, for the benefit of the Company and the
Bank Investors, in the Affected Assets as contemplated pursuant
to Section 10.11 hereof, free and clear of any Adverse Claim;
(iv) the failure to file, or any delay in filing, financing
statements, continuation statements, or other similar instruments
or documents under the UCC of any applicable jurisdiction or
other applicable laws with respect to any of the Affected Assets;
(v)  any dispute, claim, offset or defense (other than discharge
in bankruptcy) of the Obligor to the payment of any Receivable
(including, without limitation, a defense based on such
Receivable or the related Account not being the legal, valid and
binding obligation of such Obligor enforceable against it in
accordance with its terms);
(vi) any failure of the Collection Agent to perform its duties or
obligations in accordance with the provisions hereof;
(vii)     any products liability claim or personal injury or
property damage suit or other similar or related claim or action
of whatever sort arising out of or in connection with merchandise
or services which are the subject of any Receivable;
(viii)    the transfer of an ownership interest in any Receivable
other than an Eligible Receivable;
(ix) the failure by the Transferor or the Seller (individually or
as Collection Agent) to comply with any term, provision or
covenant contained in this Agreement or any of the other
Transaction Documents to which it is a party or to perform any of
its respective duties under the Account Agreements;
(x)  [Reserved]
(xi) the failure of the Seller or Initial Purchaser to pay when
due any taxes, including without limitation, sales, excise or
personal property taxes payable in connection with any of the
Receivables;
(xii)     any repayment by any Indemnified Party of any amount
previously distributed in reduction of Net Investment which such
Indemnified Party believes in good faith is required to be made;
(xiii)    the commingling by the Transferor, the Seller, the
Collection Agent, or Initial Purchaser of Collections of
Receivables at any time with other funds;
(xiv)     any investigation, litigation or proceeding related to
this Agreement, any of the other Transaction Documents, the use
of proceeds of Transfers by the Transferor or the Seller, the
ownership of Transferred Interests, or any Receivable or Account;
(xv) any inability to obtain any judgment in or utilize the court
or other adjudication system of, any state in which an Obligor
may be located as a result of the failure of the Transferor or
the Seller to qualify to do business or file any notice of
business activity report or any similar report;
(xvi)     any failure of the Transferor or Initial Purchaser to
give reasonably equivalent value to the Initial Purchaser or
Seller, respectively, in consideration of the transfer by the
Transferor and the Initial Purchaser from the Initial Purchaser
and the Seller, respectively, of any Receivable, or any attempt
by any Person to void, rescind or set aside any such transfer
under statutory provisions or common law or equitable action,
including, without limitation, any provision of the Bankruptcy
Code; or
(xvii)    any action taken by the Transferor, the Seller, the
Initial Purchaser or the Collection Agent (if the Transferor, the
Seller or any Affiliate or designee of the Transferor or the
Seller) in the enforcement or collection of any Receivable;
provided, however, that if the Company enters into agreements for
the purchase of interests in receivables from one or more Other
Transferors, the Company shall allocate such Indemnified Amounts
which are in connection with the Liquidity Provider Agreement,
the Credit Support Agreement or the credit support furnished by
the Credit Support Provider to the Transferor and each Other
Transferor; and, provided, further, that if such Indemnified
Amounts are attributable to the Transferor, the Seller, the
Initial Purchaser or the Collection Agent and not attributable to
any Other Transferor, the Transferor shall be solely liable for
such Indemnified Amounts or if such Indemnified Amounts are
attributable to Other Transferors and not attributable to the
Transferor, the Seller, the Initial Purchaser or the Collection
Agent, such Other Transferors shall be solely liable for such
Indemnified Amounts.

          SECTION 8.2.     Indemnity for Taxes, Reserves and Expenses.
          
          (a)  If after the date hereof, the adoption of any Law or bank
regulatory   guideline  or  any  amendment  or  change   in   the
interpretation  of any existing or future Law or bank  regulatory
guideline  by  any Official Body charged with the administration,
interpretation or application thereof, or the compliance with any
directive  of  any  Official  Body  (in  the  case  of  any  bank
regulatory guideline, whether or not having the force of Law):

                    (i)  shall subject any Indemnified Party to any tax, duty or
          other charge (other than Excluded Taxes) with respect to this
          Agreement, the other Transaction Documents, the ownership,
          maintenance or financing of the Transferred Interest, the
          Receivables or payments of amounts due hereunder, or shall change
          the basis of taxation of payments to any Indemnified Party of
          amounts payable in respect of this Agreement, the other
          Transaction Documents, the ownership, maintenance or financing of
          the Transferred Interest, the Receivables or payments of amounts
          due hereunder or its obligation to advance funds hereunder, under
          the Liquidity Provider Agreement or the credit support furnished
          by the Credit Support Provider or otherwise in respect of this
          Agreement, the other Transaction Documents, the ownership,
          maintenance or financing of the Transferred Interest or the
          Receivables (except for changes in the rate of general corporate,
          franchise, net income or other income tax imposed on such
          Indemnified Party by the jurisdiction in which such Indemnified
          Party's principal executive office is located);
          
(ii) shall impose, modify or deem applicable any reserve, special
deposit or similar requirement (including, without limitation,
any such requirement imposed by the Board of Governors of the
Federal Reserve System) against assets of, deposits with or for
the account of, or credit extended by, any Indemnified Party or
shall impose on any Indemnified Party or on the United States
market for certificates of deposit or the London interbank market
any other condition affecting this Agreement, the other
Transaction Documents, the ownership, maintenance or financing of
the Transferred Interest, the Receivables or payments of amounts
due hereunder or its obligation to advance funds hereunder under
the Liquidity Provider Agreement or the credit support provided
by the Credit Support Provider or otherwise in respect of this
Agreement, the other Transaction Documents, the ownership,
maintenance or financing of the Transferred Interest or the
Receivables; or
(iii)     imposes upon any Indemnified Party any other expense
(including, without limitation, reasonable attorneys' fees and
expenses, and expenses of litigation or preparation therefor in
contesting any of the foregoing) with respect to this Agreement,
the other Transaction Documents, the ownership, maintenance or
financing of the Transferred Interest, the Receivables or
payments of amounts due hereunder or its obligation to advance
funds hereunder under the Liquidity Provider Agreement or the
credit support furnished by the Credit Support Provider or
otherwise in respect of this Agreement, the other Transaction
Documents, the ownership, maintenance or financing of the
Transferred Interests or the Receivables,
and the result of any of the foregoing is to increase the cost to
such Indemnified Party with respect to this Agreement, the other
Transaction Documents, the ownership, maintenance or financing of
the Transferred Interest, the Receivables, the obligations
hereunder, the funding of any purchases hereunder, the Liquidity
Provider Agreement or the Credit Support Agreement, by an amount
deemed by such Indemnified Party to be material, then, within ten
(10) days after demand by such Indemnified Party through the
Agent, the Transferor shall pay to the Agent, for the benefit of
such Indemnified Party, such additional amount or amounts as will
compensate such Indemnified Party for such increased cost or
reduction.

          (b)  If any Indemnified Party shall have determined that after
the  date  hereof,  the adoption of any applicable  Law  or  bank
regulatory  guideline regarding capital adequacy, or  any  change
therein,  or  any  change in the interpretation  thereof  by  any
Official  Body, or any directive regarding capital  adequacy  (in
the  case of any bank regulatory guideline, whether or not having
the  force  of law) of any such Official Body, has or would  have
the  effect  of  reducing the rate of return on capital  of  such
Indemnified  Party  (or  its parent) as  a  consequence  of  such
Indemnified Party's obligations hereunder or with respect  hereto
to  a  level  below  that which such Indemnified  Party  (or  its
parent)  could  have  achieved but  for  such  adoption,  change,
request or directive (taking into consideration its policies with
respect  to  capital  adequacy)  by  an  amount  deemed  by  such
Indemnified Party to be material, then from time to time,  within
ten  (10) days after demand by such Indemnified Party through the
Agent, the Transferor shall pay to the Agent, for the benefit  of
such Indemnified Party, such additional amount or amounts as will
compensate  such  Indemnified Party  (or  its  parent)  for  such
reduction.

          (c)  The Agent will promptly notify the Transferor of any event
of which it has knowledge, occurring after the date hereof, which
will  entitle  an Indemnified Party to compensation  pursuant  to
this  Section  8.2.   A  notice by the Agent  or  the  applicable
Indemnified  Party claiming compensation under this  Section  and
setting forth the additional amount or amounts to be paid  to  it
hereunder  shall be conclusive in the absence of manifest  error.
In   determining  such  amount,  the  Agent  or  any   applicable
Indemnified   Party   may  use  any  reasonable   averaging   and
attributing methods.

(d)  Anything in this Section 8.2 to the contrary
notwithstanding, if the Company enters into agreements for the
acquisition of interests in receivables from one or more Other
Transferors, the Company shall allocate the liability for any
amounts under this Section 8.2 which are in connection with the
Liquidity Provider Agreement, the Credit Support Agreement or the
credit support provided by the Credit Support Provider ("Section
8.2 Costs") to the Transferor and each Other Transferor;
provided, however, that if such Section 8.2 Costs are
attributable to the Transferor, the Seller or the Collection
Agent and not attributable to any Other Transferor, the
Transferor shall be solely liable for such Section 8.2 Costs or
if such Section 8.2 Costs are attributable to Other Transferors
and not attributable to the Transferor, the Seller or the
Collection Agent, such Other Transferors shall be solely liable
for such Section 8.2 Costs.
          SECTION 8.3.     Taxes.
          
               All  payments made hereunder by the Transferor  or
the  Collection Agent (each, a "payor") to the Company, any  Bank
Investor  or the Agent (each, a "recipient") shall be  made  free
and  clear  of  and without deduction for any present  or  future
income,  excise,  stamp or franchise taxes and any  other  taxes,
fees,  duties,  withholdings  or  other  charges  of  any  nature
whatsoever  imposed by any taxing authority on any recipient  (or
any  assignee  of  such parties) (such  nonexcluded  items  being
called  "Taxes"), but excluding franchise taxes and taxes imposed
on  or  measured by the recipient's net income or gross  receipts
("Excluded  Taxes").   In  the  event  that  any  withholding  or
deduction  from  any  payment made  by  the  payor  hereunder  is
required in respect of any Taxes, then such payor shall:

          (a)  pay directly to the relevant authority the full amount
required to be so withheld or deducted;

(b)  promptly forward to the Agent an official receipt or other
documentation satisfactory to the Agent evidencing such payment
to such authority; and
(c)  pay to the recipient such additional amount or amounts as is
necessary to ensure that the net amount actually received by the
recipient will equal the full amount such recipient would have
received had no such withholding or deduction been required.
Moreover, if any Taxes are directly asserted against any
recipient with respect to any payment received by such recipient
hereunder, the recipient may pay such Taxes and the payor will
promptly pay such additional amounts (including any penalties,
interest or expenses) as shall be necessary in order that the net
amount received by the recipient after the payment of such Taxes
(including any Taxes on such additional amount) shall equal the
amount such recipient would have received had such Taxes not been
asserted.

               If  the  payor fails to pay any Taxes when due  to
the  appropriate  taxing  authority or  fails  to  remit  to  the
recipient  the  required receipts or other  required  documentary
evidence,  the  payor  shall  indemnify  the  recipient  for  any
incremental Taxes, interest, or penalties that may become payable
by any recipient as a result of any such failure.

          SECTION 8.4.     Other Costs, Expenses and Related Matters.
          
          (a)  The Transferor agrees, upon receipt of a written invoice, to
pay  or  cause  to  be paid, and to save the  Company,  the  Bank
Investors  and  the  Agent  harmless against  liability  for  the
payment  of,  all  reasonable out-of-pocket expenses  (including,
without  limitation, attorneys', accountants',  rating  agencies'
and  other third parties' fees and expenses, any filing fees  and
expenses  incurred by officers or employees of the  Company,  the
Bank  Investors  and/or the Agent) or intangible, documentary  or
recording taxes incurred by or on behalf of the Company, any Bank
Investor  and  the Agent (i) in connection with the  negotiation,
execution, delivery and preparation of this Agreement, the  other
Transaction Documents and any documents or instruments  delivered
pursuant  hereto  and  thereto and the transactions  contemplated
hereby  or thereby (including, without limitation, the perfection
or  protection of the Transferred Interest) whether  or  not  the
transactions  contemplated hereby are consummated and  (ii)  from
time  to time (a) relating to any amendments, waivers or consents
under  this  Agreement and the other Transaction  Documents,  (b)
arising  in  connection with the Company's, any Bank  Investor's,
the Agent's or the Collateral Agent's enforcement or preservation
of  rights  (including, without limitation,  the  perfection  and
protection of the Transferred Interest under this Agreement),  or
(c)  arising in connection with any audit, dispute, disagreement,
litigation or preparation for litigation involving this Agreement
or  any  of the other Transaction Documents (all of such amounts,
collectively, "Transaction Costs").

(b)  The Transferor shall pay the Agent, for the account of the
Company and the Bank Investors, as applicable, on demand any
Early Collection Fee due on account of the receipt by the Company
or any Bank Investor of any amounts applied in reduction of the
Net Investment on any day other than a Remittance Date or the
last day of any applicable funding period (in the case of any
LIBOR-based funding).
          SECTION 8.5.     Reconveyance Under Certain Circumstances.
          
               The  Transferor agrees to accept the  reconveyance
from  the  Agent,  on  behalf  of the  Company  and/or  the  Bank
Investors,  of  the  Transferred Interest if the  Agent  notifies
Transferor of a breach of any representation or warranty made  or
deemed  made pursuant to Sections 3.1(a), (b), (c),  (d)  or  (j)
hereof  and Transferor shall fail to cure such breach (including,
without  limitation, pursuant to Section 2.9(b)) within  15  days
(or,  in  the  case  of  the representations  and  warranties  in
Sections  3.1(d) and 3.1(j) hereof 3 days) of such  notice.   The
reconveyance price shall be paid by the Transferor to  the  Agent
hereof, for the account of the Company and the Bank Investors, as
applicable, in immediately available funds on such 15th  day  (or
3rd  day,  if  applicable) in an amount equal  to  the  Aggregate
Unpaids.

                                
                                
                                
                           ARTICLE IX
                                
                   THE AGENT; BANK COMMITMENT
                                
SECTION 9.

          SECTION 9.1.     Authorization and Action.
          
          (a)  The Company and each Bank Investor hereby appoints and
authorizes  the Agent to take such action as agent on its  behalf
and  to  exercise such powers under this Agreement and the  other
Transaction Documents as are delegated to the Agent by the  terms
hereof  and  thereof, together with such powers as are reasonably
incidental  thereto.   In furtherance, and without  limiting  the
generality, of the foregoing, the Company and each Bank  Investor
hereby appoints the Agent as its agent to execute and deliver all
further  instruments and documents, and take all  further  action
that  the  Agent may deem necessary or appropriate  or  that  the
Company  or  a Bank Investor may reasonably request in  order  to
perfect, protect or more fully evidence the interests transferred
or  to  be  transferred  from  time to  time  by  the  Transferor
hereunder, or to enable any of them to exercise or enforce any of
their respective rights hereunder, including, without limitation,
the  execution  by  the Agent as secured party/assignee  of  such
financing  or continuation statements, or amendments  thereto  or
assignments  thereof, relative to all or any of  the  Receivables
now existing or hereafter arising, and such other instruments  or
notices,  as  may  be necessary or appropriate for  the  purposes
stated herein above.  The Company and the Majority Investors  may
direct  the  Agent to take any such incidental action  hereunder.
With respect to other actions which are incidental to the actions
specifically  delegated to the Agent hereunder, the  Agent  shall
not be required to take any such incidental action hereunder, but
shall be required to act or to refrain from acting (and shall  be
fully  protected  in acting or refraining from acting)  upon  the
direction  of  the  Majority Investors; provided,  however,  that
Agent  shall not be required to take any action hereunder if  the
taking  of  such action, in the reasonable determination  of  the
Agent,  shall  be  in violation of any applicable  law,  rule  or
regulation  or  contrary to any provision of  this  Agreement  or
shall expose the Agent to liability hereunder or otherwise.  Upon
the  occurrence  and  during the continuance of  any  Termination
Event  or  Potential Termination Event, the Agent shall  take  no
action  hereunder (other than ministerial actions or such actions
as  are  specifically  provided for  herein)  without  the  prior
consent  of  the Majority Investors (which consent shall  not  be
unreasonably withheld or delayed).  The Agent shall not,  without
the  prior  written consent of all Bank Investors, agree  to  (i)
amend, modify or waive any provision of this Agreement in any way
which  would (A) reduce or impair Collections or the  payment  of
interest or fees payable hereunder to the Bank Investors or delay
the scheduled dates for payment of such amounts, (B) increase the
Servicing  Fee  (other  than  as permitted  pursuant  to  Section
6.2(b)),  (C)  modify  any provisions of this  Agreement  or  the
Receivables Purchase Agreement relating to the timing of payments
required  to  be  made by the Transferor or  the  Seller  or  the
application  of  the proceeds of such payments,  (D)  permit  the
appointment  of  any Person (other than the Agent)  as  successor
Collection Agent, (E) release any property from the lien provided
by  this  Agreement (other than as expressly contemplated herein)
or   (F)  extend  or  permit  the  extension  of  the  Commitment
Termination Date without the consent of each Bank Investor.   The
Agent  shall  not agree to any amendment of this Agreement  which
increases  the  dollar  amount of a  Bank  Investor's  Commitment
without  the  prior consent of such Bank Investor.  In  addition,
the  Agent shall not agree to any amendment of this Agreement not
specifically described in the two preceding sentences without the
consent  of  the related Majority Investors (which consent  shall
not  be  unreasonably withheld or delayed).  "Majority Investors"
shall mean, at any time, the Agent and those Bank Investors which
hold  Commitments aggregating in excess of 66  and  2/3%  of  the
Facility  Limit as of such date.  In the event the Agent requests
the  Company's  or  a  Bank Investor's consent  pursuant  to  the
foregoing  provisions and the Agent does not  receive  a  consent
(either  positive  or  negative) from the Company  or  such  Bank
Investor  within  10  Business Days  of  the  Company's  or  Bank
Investor's receipt of such request, then the Company or such Bank
Investor  (and  its  percentage  interest  hereunder)  shall   be
disregarded in determining whether the Agent shall have  obtained
sufficient consent hereunder.

(b)  The Agent shall exercise such rights and powers vested in it
by this Agreement and the other Transaction Documents, and use
the same degree of care and skill in their exercise, as a prudent
person would exercise or use under the circumstances in the
conduct of such person's own affairs.
          SECTION 9.2.     Agent's Reliance, Etc.
          
               Neither  the  Agent  nor  any  of  its  directors,
officers,  agents  or employees shall be liable  for  any  action
taken  or omitted to be taken by it or them as Agent under or  in
connection  with  this Agreement or any of the other  Transaction
Documents,  except  for  its or their  own  gross  negligence  or
willful  misconduct.  Without limiting the foregoing, the  Agent:
(i)  may  consult with legal counsel (including counsel  for  the
Transferor  or  the Seller), independent public  accountants  and
other  experts  selected by it and shall not be  liable  for  any
action  taken  or  omitted to be taken in good  faith  by  it  in
accordance  with  the  advice  of such  counsel,  accountants  or
experts; (ii) makes no warranty or representation to the  Company
or  any Bank Investor and shall not be responsible to the Company
or   any   Bank  Investor  for  any  statements,  warranties   or
representations  made  in or in connection with  this  Agreement;
(iii)  shall not have any duty to ascertain or to inquire  as  to
the  performance or observance of any of the terms, covenants  or
conditions  of  this  Agreement or any of the  other  Transaction
Documents on the part of the Transferor, the Collection Agent  or
the  Seller or to inspect the property (including the  books  and
records)  of the Transferor, the Collection Agent or the  Seller;
(iv) shall not be responsible to the Company or any Bank Investor
for   the  due  execution,  legality,  validity,  enforceability,
genuineness, sufficiency or value of this Agreement, any  of  the
other  Transaction Documents or any other instrument or  document
furnished  pursuant  hereto or thereto; and (v)  shall  incur  no
liability  under or in respect of this Agreement or  any  of  the
other  Transaction Documents by acting upon any notice (including
notice by telephone), consent, certificate or other instrument or
writing (which may be by telex) believed by it to be genuine  and
signed or sent by the proper party or parties.

          SECTION 9.3.     Credit Decision.
          
               The  Company  and each Bank Investor  acknowledges
that  it has, independently and without reliance upon the  Agent,
any  of  the Agent's Affiliates, any other Bank Investor  or  the
Company  (in the case of any Bank Investor) and based  upon  such
documents and information as it has deemed appropriate, made  its
own  evaluation and decision to enter into this Agreement and the
other Transaction Documents to which it is a party and, if it  so
determines, to accept the transfer to the Agent on its behalf  of
any   undivided   ownership  interest  in  the  Affected   Assets
hereunder.   The Company and each Bank Investor also acknowledges
that  it will, independently and without reliance upon the Agent,
any  of  the Agent's Affiliates, any other Bank Investor  or  the
Company  (in  the case of any Bank Investor) and  based  on  such
documents  and  information as it shall deem appropriate  at  the
time,  continue to make its own decisions in taking or not taking
action  under this Agreement and the other Transaction  Documents
to which it is a party.

          SECTION 9.4.     Indemnification of the Agent.
          
               The  Bank  Investors agree to indemnify the  Agent
(to  the  extent  not reimbursed by the Transferor),  ratably  in
accordance with their Pro Rata Shares, from and against  any  and
all   liabilities,   obligations,  losses,  damages,   penalties,
actions,  judgments, suits, costs, expenses or  disbursements  of
any  kind  or nature whatsoever which may be imposed on, incurred
by,  or  asserted  against the Agent in any way  relating  to  or
arising  out of this Agreement or any action taken or omitted  by
the  Agent,  any of the other Transaction Documents hereunder  or
thereunder; provided, however, that the Bank Investors shall  not
be  liable  for  any  portion  of such liabilities,  obligations,
losses,  damages,  penalties, actions, judgments,  suits,  costs,
expenses  or  disbursements  resulting  from  the  Agent's  gross
negligence  or  willful misconduct.  Without  limitation  of  the
foregoing,  the  Bank  Investors agree to  reimburse  the  Agent,
ratably  in accordance with their Pro Rata Shares, promptly  upon
demand  for  any out-of-pocket expenses (including counsel  fees)
incurred  by  the  Agent in connection with  the  administration,
modification,   amendment   or   enforcement   (whether   through
negotiations, legal proceedings or otherwise) of, or legal advice
in  respect  of rights or responsibilities under, this  Agreement
and  the  other  Transaction Documents, to the extent  that  such
expenses are incurred in the interests of or otherwise in respect
of  the  Bank Investors hereunder and/or thereunder  and  to  the
extent that the Agent is not reimbursed for such expenses by  the
Transferor.

          SECTION 9.5.     Successor Agent.
          
               The Agent may resign at any time by giving written
notice  thereof  to  each  Bank Investor,  the  Company  and  the
Transferor  and  may be removed at any time  with  cause  by  the
Majority  Investors.  Upon any such resignation or  removal,  the
Company  and  the  Majority Investors shall appoint  a  successor
Agent.   The Company and each Bank Investor agrees that it  shall
not   unreasonably  withhold  or  delay  its  approval   of   the
appointment  of  a successor Agent.  If no such  successor  Agent
shall  have  been  so  appointed, and shall  have  accepted  such
appointment, within 30 days after the retiring Agent's giving  of
notice  of resignation or the Majority Investors' removal of  the
retiring  Agent, then the retiring Agent may, on  behalf  of  the
Company  and the Bank Investors, appoint a successor Agent  which
successor  Agent shall be either (i) a commercial bank  organized
under  the laws of the United States or of any state thereof  and
have  a  combined capital and surplus of at least $50,000,000  or
(ii)  an  Affiliate of such a bank.  Upon the acceptance  of  any
appointment  as  Agent  hereunder  by  a  successor  Agent,  such
successor Agent shall thereupon succeed to and become vested with
all  the  rights, powers, privileges and duties of  the  retiring
Agent, and the retiring Agent shall be discharged from its duties
and obligations under this Agreement.  After any retiring Agent's
resignation or removal hereunder as Agent, the provisions of this
Article  IX  shall  continue to inure to its benefit  as  to  any
actions  taken or omitted to be taken by it while  it  was  Agent
under this Agreement.

          SECTION 9.6.     Payments by the Agent.
          
               Unless  specifically allocated to a Bank  Investor
pursuant to the terms of this Agreement, all amounts received  by
the  Agent on behalf of the Bank Investors shall be paid  by  the
Agent  to  the  Bank  Investors  (at  their  respective  accounts
specified   in   their  respective  Assignment   and   Assumption
Agreements) in accordance with their respective related pro  rata
interests  in the Net Investment on the Business Day received  by
the  Agent, unless such amounts are received after 12:00 noon  on
such  Business  Day,  in  which case  the  Agent  shall  use  its
reasonable  efforts to pay such amounts to the Bank Investors  on
such  Business Day, but, in any event, shall pay such amounts  to
the  Bank  Investors in accordance with their respective  related
pro  rata  interests  in the Net Investment not  later  than  the
following Business Day.

          SECTION 9.7.     Bank Commitment; Assignment to Bank Investors.
          
          (a)  Bank Commitment.

               At   any  time  on  or  prior  to  the  Commitment
Termination Date, in the event that the Company does  not  effect
an  Incremental Transfer as requested under Section 2.2(a),  then
at  any time, the Transferor shall have the right to require  the
Company to assign its interest in the Net Investment in whole  to
the Bank Investors pursuant to this Section 9.7.  In addition, at
any  time on or prior to the Commitment Termination Date (i) upon
the  occurrence  of  a  Termination Event  that  results  in  the
Termination Date or (ii) the Company elects to give notice to the
Transferor  of  a Reinvestment Termination Date,  the  Transferor
hereby  requests and directs that the Company assign its interest
in  the Net Investment in whole to the Bank Investors pursuant to
this  Section  9.7 and the Transferor hereby agrees  to  pay  the
amounts described in Section 9.7(d) below.  Provided that the Net
Asset Test is satisfied, upon any such election by the Company or
any  such request by the Transferor, the Company shall make  such
assignment  and  the Bank Investors shall accept such  assignment
and shall assume all of the Company's obligations hereunder.   In
connection  with  any  assignment from the Company  to  the  Bank
Investors pursuant to this Section 9.7, each Bank Investor shall,
on  the  date  of such assignment, pay to the Company  an  amount
equal  to  its  Assignment Amount.  Upon any  assignment  by  the
Company to the Bank Investors contemplated hereunder, the Company
shall   cease  to  make  any  additional  Incremental   Transfers
hereunder.

          (b)  Assignment.

               No  Bank  Investor may assign all or a portion  of
its  interests  in  the  Net  Investment,  the  Receivables,  and
Collections and Proceeds with respect thereto and its rights  and
obligations hereunder to any Person unless approved in writing by
the  Transferor,  the Agent, on behalf of the  Company,  and  the
Agent.   In the case of an assignment by the Company to the  Bank
Investors  or by a Bank Investor to another Person, the  assignor
shall  deliver  to the assignee(s) an Assignment  and  Assumption
Agreement in substantially the form of Exhibit B attached hereto,
duly  executed, assigning to the assignee a pro rata interest  in
the Net Investment, the Receivables, and Collections and Proceeds
with  respect  thereto and the assignor's rights and  obligations
hereunder and the assignor shall promptly execute and deliver all
further  instruments and documents, and take all further  action,
that the assignee may reasonably request, in order to protect, or
more  fully evidence the assignee's right, title and interest  in
and  to such interest and to enable the Agent, on behalf of  such
assignee,  to exercise or enforce any rights hereunder and  under
the  other  Transaction Documents to which such assignor  is  or,
immediately prior to such assignment, was a party.  Upon any such
assignment,  (i) the assignee shall have all of  the  rights  and
obligations  of  the  assignor  hereunder  and  under  the  other
Transaction  Documents to which such assignor is or,  immediately
prior  to  such  assignment, was a party  with  respect  to  such
interest  for all purposes of this Agreement and under the  other
Transaction  Documents to which such assignor is or,  immediately
prior  to such assignment, was a party (it being understood  that
the  Bank Investors, as assignees, shall (x) be obligated to fund
Incremental  Transfers under Section 2.2(a) hereof in  accordance
with the terms thereof, notwithstanding that the Company was  not
so obligated and (y) not have the right to elect the commencement
of  the  amortization  of  the  Net Investment  pursuant  to  the
definition  of  "Reinvestment Termination Date",  notwithstanding
that  the  Company  had such right) and (ii) the  assignor  shall
relinquish  its  rights  with respect to such  interest  for  all
purposes  of  this  Agreement  and under  the  other  Transaction
Documents to which such assignor is or, immediately prior to such
assignment,  was a party.  No such assignment shall be  effective
unless  a  fully  executed  copy of the  related  Assignment  and
Assumption  Agreement shall be delivered to  the  Agent  and  the
Transferor.  All costs and expenses of the Agent and the assignor
and assignee incurred in connection with any assignment hereunder
shall  be borne by the Transferor and not by the assignor or  any
such assignee.  No Bank Investor shall assign any portion of  its
Commitment  hereunder  without also simultaneously  assigning  an
equal   portion  of  its  interest  in  the  Liquidity   Provider
Agreement.

          (c)  Effects of Assignment.

               By  executing  and  delivering an  Assignment  and
Assumption  Agreement,   the  assignor  and  assignee  thereunder
confirm to and agree with each other and the other parties hereto
as  follows:   (i) other than as provided in such Assignment  and
Assumption  Agreement, the assignor makes  no  representation  or
warranty  and  assumes  no responsibility  with  respect  to  any
statements,  warranties  or  representations  made   in   or   in
connection  with this Agreement, the other Transaction  Documents
or  any other instrument or document furnished pursuant hereto or
thereto  or  the  execution, legality, validity,  enforceability,
genuineness,  sufficiency or value or this Agreement,  the  other
Transaction  Documents or any such other instrument or  document;
(ii) the assignor makes no representation or warranty and assumes
no  responsibility with respect to the financial condition of the
Transferor, the Seller or the Collection Agent or the performance
or  observance  by the Transferor, the Seller or  the  Collection
Agent   of  any  of  their  respective  obligations  under   this
Agreement,   the  Receivables  Purchase  Agreement,   the   other
Transaction  Documents  or  any  other  instrument  or   document
furnished pursuant hereto; (iii) such assignee confirms  that  it
has  received a copy of this Agreement, the Receivables  Purchase
Agreement  and such other instruments, documents and  information
as  it has deemed appropriate to make its own credit analysis and
decision  to enter into such Assignment and Assumption  Agreement
and   to  purchase  such  interest;  (iv)  such  assignee   will,
independently and without reliance upon the Agent, or any of  its
Affiliates,  or  the  assignor  and  based  on  such  agreements,
documents  and  information as it shall deem appropriate  at  the
time, continue to make its own credit decisions in taking or  not
taking  action  under  this Agreement and the  other  Transaction
Documents; (v) such assignee appoints and authorizes the Agent to
take  such  action  as agent on its behalf and to  exercise  such
powers under this Agreement, the other Transaction Documents  and
any  other  instrument or document furnished pursuant  hereto  or
thereto  as  are  delegated to the Agent by the terms  hereof  or
thereof,  together with such powers as are reasonably  incidental
thereto and to enforce its respective rights and interests in and
under  this  Agreement,  the  other  Transaction  Documents,  the
Receivables and the Account Agreements; (vi) such assignee agrees
that  it will perform in accordance with their terms all  of  the
obligations  which by the terms of this Agreement and  the  other
Transaction Documents are required to be performed by it  as  the
assignee of the assignor; and (vii) such assignee agrees that  it
will not institute against the Company any proceeding of the type
referred to in Section 10.9 hereof prior to the date which is one
year  and  one  day after the payment in full of  all  Commercial
Paper issued by the Company.

          (d)  Transferor's Obligation to Pay Certain Amounts; Additional
Assignment Amount.

               The  Transferor  shall pay to the Agent,  for  the
account of the Company, in connection with any assignment by  the
Company  to the Bank Investors pursuant to this Section  9.7,  an
aggregate  amount equal to all Carrying Costs to  accrue  through
the  end  of  each  outstanding funding  period  plus  all  other
Aggregate Unpaids (other than the Net Investment).  To the extent
that  such  Carrying  Costs relate to  interest  or  discount  on
Related Commercial Paper, if the Transferor fails to make payment
of  such  amounts  at or prior to the time of assignment  by  the
Company to the Bank Investors, such amount shall be paid  by  the
Bank  Investors  (in  accordance with their respective  Pro  Rata
Shares)  to  the  Company  as additional  consideration  for  the
interests  assigned to the Bank Investors and the amount  of  the
"Net  Investment" hereunder held by the Bank Investors  shall  be
increased by an amount equal to the additional amount so paid  by
the Bank Investors.

          (e)  Administration of Agreement After Assignment.

               After  any assignment by the Company to  the  Bank
Investors  pursuant to this Section 9.7 (and the payment  of  all
amounts owing to the Company in connection therewith), all rights
of  the  Agent and the Collateral Agent set forth herein shall be
deemed  to  be  afforded  to the Agent  on  behalf  of  the  Bank
Investors instead of either such party.

          (f)  Payments.

               After  any assignment by the Company to  the  Bank
Investors pursuant to this Section 9.7, all payments to  be  made
hereunder  by  the  Transferor or the  Collection  Agent  to  the
Company  shall  be made to the Agent's account  as  such  account
shall  have  been notified to the Transferor and  the  Collection
Agent.

          (g)  Downgrade of Bank Investor.

               If  at  any  time prior to any assignment  by  the
Company  to the Bank Investors as contemplated pursuant  to  this
Section  9.7,  the  short term debt rating of any  Bank  Investor
shall  be  "A-2"  or  "HP-2" from Standard & Poor's  or  Moody's,
respectively,  with  negative  credit  implications,  such   Bank
Investor,  upon request of the Agent, shall, within  30  days  of
such  request,  assign  its rights and obligations  hereunder  to
another  financial  institution (which institution's  short  term
debt  shall  be  rated at least "A-2" and "P-2" from  Standard  &
Poor's and Moody's, respectively, and which shall not be so rated
with  negative  credit implications).  If  the  short  term  debt
rating of a Bank Investor shall be "A-3" or "P-3", or lower, from
Standard & Poor's or Moody's, respectively (or such rating  shall
have  been withdrawn by Standard & Poor's or Moody's), such  Bank
Investor,  upon  request  of the Agent, shall,  within  five  (5)
Business  Days of such request, assign its rights and obligations
hereunder  to  another financial institution (which institution's
short  term  debt shall be rated at least "A-2"  and  "P-2"  from
Standard & Poor's and Moody's, respectively, and which shall  not
be  so rated with negative credit implications).  In either  such
case,  if  any  such  Bank Investor shall not have  assigned  its
rights and obligations under this Agreement within the applicable
time period described above, the Company shall have the right  to
require such Bank Investor to accept the assignment of such  Bank
Investor's  Pro Rata Share of the Net Investment; such assignment
shall occur in accordance with the applicable provisions of  this
Section 9.7.  Such Bank Investor shall be obligated to pay to the
Company, in connection with such assignment, in addition  to  the
Pro  Rata  Share of the Net Investment, an amount  equal  to  the
interest component of the outstanding Commercial Paper issued  to
fund  the  portion of the Net Investment being assigned  to  such
Bank   Investor,   as  reasonably  determined   by   the   Agent.
Notwithstanding anything contained herein to the  contrary,  upon
any such assignment to a downgraded Bank Investor as contemplated
pursuant  to  the immediately preceding sentence,  the  aggregate
available  amount of the Facility Limit, solely as it relates  to
new Incremental Transfers by the Company, shall be reduced by the
amount of unused Commitment of such downgraded Bank Investor;  it
being understood and agreed, that nothing in this sentence or the
two  preceding sentences shall affect or diminish in any way  any
such  downgraded Bank Investor's Commitment to the Transferor  or
such downgraded Bank Investor's other obligations and liabilities
hereunder and under the other Transaction Documents.

                            ARTICLE X
                                
                          MISCELLANEOUS
                                
SECTION 10.

          SECTION 10.1.    Term of Agreement.
          
               This   Agreement  shall  terminate  on  the   date
following the Termination Date upon which the Net Investment  has
been  reduced to zero and all other Aggregate Unpaids  have  been
paid in full, in each case, in cash; provided, however, that  (i)
the  rights  and  remedies of the Agent, the  Company,  the  Bank
Investors  and the  Agent with respect to any representation  and
warranty made or deemed to be made by the Transferor pursuant  to
this  Agreement, (ii) the indemnification and payment  provisions
of  Article  VIII, and (iii) the agreement set forth  in  Section
10.9   hereof,  shall  be  continuing  and  shall   survive   any
termination of this Agreement.

          SECTION 10.2.    Waivers; Amendments.
          
               No  failure or delay on the part of the Agent, the
Company  or any Bank Investor in exercising any power,  right  or
remedy  under  this Agreement shall operate as a waiver  thereof,
nor shall any single or partial exercise of any such power, right
or  remedy  preclude any other further exercise  thereof  or  the
exercise  of  any other power, right or remedy.  The  rights  and
remedies herein provided shall be cumulative and nonexclusive  of
any  rights or remedies provided by law.  Any provision  of  this
Agreement may be amended or waived if, but only if, in  the  case
of  any amendment, such amendment is in writing and is signed  by
the Transferor, the Company, the Agent and the Majority Investors
and  in the case of any waiver, such waiver is granted in writing
by the Agent and the Majority Investors.

          SECTION 10.3.    Notices.
          
               Except  as provided below, all communications  and
notices  provided  for hereunder shall be in  writing  (including
telecopy or electronic facsimile transmission or similar writing)
and  shall be given to the other party at its address or telecopy
number  set  forth  below or at such other  address  or  telecopy
number  as  such party may hereafter specify for the purposes  of
notice  to  such party.  Each such notice or other  communication
shall  be  effective (i) if given by telecopy, when such telecopy
is  transmitted to the telecopy number specified in this  Section
10.3  and  confirmation is received, (ii)  if  given  by  mail  3
Business  Days  following  such posting,  postage  prepaid,  U.S.
certified or registered, (iii) if given by overnight courier, one
(1)  Business Day after deposit thereof with a national overnight
courier  service,  or  (iv) if given by  any  other  means,  when
received at the address specified in this Section 10.3.  However,
anything  in  this  Section to the contrary notwithstanding,  the
Transferor hereby authorizes the Company to effect Transfers  and
funding period selections based on telephonic notices made by any
Person  which the Company in good faith believes to be acting  on
behalf  of  the  Transferor.  The Transferor  agrees  to  deliver
promptly to the Company a written confirmation of each telephonic
notice  signed by an authorized officer of Transferor.   However,
the absence of such confirmation shall not affect the validity of
such notice.  If the written confirmation differs in any material
respect from the action taken by the Company, the records of  the
Company shall govern absent manifest error.

               If to the Company:

                    Kitty Hawk Funding Corporation
                    c/o Lord Securities Corporation
                    Two Wall Street
                    New York, New York  10005
          
                    Attention:  Frank Bilotta
                    Telephone:  (212) 346-9008
                    Telecopy:   (212) 346-9012
          
                    (with a copy to the Agent)
                    Payment Information:
                    Bankers Trust
                    ABA 021 001 033
                    New York, NY
                    Account: Corporate Trust Agency Group
                    Account #: 01419647
                    Ref:  Kitty Hawk Funding Corporation
                    For Further Credit KHFC Collateral
                    General Account #12035
          
               If to the Transferor:
                    Metris Funding Co.
                    600 South Highway 169, Suite 300
                    St. Louis Park, MN  55426
                    Telephone:  (612) 525-5024
                    Telecopy:  (612) 525-5070
                    Payment Information:
                    Bank:  Norwest Bank, N.A. Minnesota
                    ABA 091 000 019
                    Account 635 5039 358
                    Reference:  KHFC/Mercantile
          
               If to the Collection Agent:
                    Direct Merchants Credit Card Bank, N.A.
                    1455 West 2200 South
                    Salt Lake City, Utah 84119
                    Telephone:  (801) 974-4699
                    Telecopy:  (801) 974-4672
          
               If to the Collateral Agent:
                    NationsBank, N.A.
                    NationsBank Corporate Center -- 10th Floor
                    Charlotte, North Carolina  28255
                    Attention:  Michelle M. Heath, Structured
Finance
                    Telephone:  (704) 386-7922
                    Telecopy:   (704) 388-9169
          
               If to the Agent:
                    NationsBank, N.A.
                    NationsBank Corporate Center, -- 10th Floor
                    Charlotte, North Carolina  28255
                    Attention:  Michelle M. Heath, Structured
Finance
                    Telephone:  (704) 386-7922
                    Telecopy:   (704) 388-9169
                    Payment Information:
                    NationsBank, N.A.
                    ABA 053000196
                    for the account of IBG Operations/Admin.
                    Account No. 1093601650000
                    Ref: Mercantile Portfolio Acquisition
                    Attn.: Camille Zerbinos

               If  to  the  Bank  Investors, at their  respective
addresses  set  forth on the signature pages  hereto  or  of  the
Assignment and Assumption Agreement pursuant to which it became a
party hereto.

          SECTION 10.4.    Governing Law; Submission to Jurisdiction;
          Integration.
          
          (a)  THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.  Each  of  the
parties  hereto  agrees that a final judgment in any  such  court
shall  be  conclusive  and  may be enforced  in  such  and  other
jurisdictions  by  suit on the judgment or in  any  other  manner
provided by law.  Each of the Collection Agent and the Transferor
hereby   irrevocably  waives,  to  the  fullest  extent  it   may
effectively  do so, any objection which it may now  or  hereafter
have to the laying of the venue of any such proceeding brought in
such  a  court and any claim that any such proceeding brought  in
such  a  court  has  been  brought in an  inconvenient  forum  in
connection   with  any  objection  based  on  lack  of   personal
jurisdiction.   Nothing  in this Section 10.4  shall  affect  the
right  of  the Company to bring any action or proceeding  against
the  Transferor,  the Collection Agent or their property  in  the
courts of other jurisdictions.

(b)  EACH OF THE PARTIES HERETO HEREBY WAIVES ANY RIGHT TO HAVE A
JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN
CONTRACT, TORT OR OTHERWISE AMONG ANY OF THEM ARISING OUT OF,
CONNECTED WITH, RELATING TO OR INCIDENTAL TO THE RELATIONSHIP
BETWEEN THEM IN CONNECTION WITH THIS AGREEMENT OR THE OTHER
TRANSACTION DOCUMENTS.
(c)  This Agreement contains the final and complete integration
of all prior expressions by the parties hereto with respect to
the subject matter hereof and shall constitute the entire
Agreement among the parties hereto with respect to the subject
matter hereof superseding all prior oral or written
understandings.
(d)  Each of the parties hereto irrevocably consents to service
of process in the manner provided for notices in Section 10.3.
Nothing in this Agreement will affect the right of any party
hereto to serve process in any other manner permitted by law.
          SECTION 10.5.    Severability; Counterparts.
          
               This  Agreement may be executed in any  number  of
counterparts  and  by  different  parties  hereto   in   separate
counterparts, each of which when so executed shall be  deemed  to
be  an  original  and  all  of which when  taken  together  shall
constitute  one and the same Agreement.  Any provisions  of  this
Agreement   which   are  prohibited  or  unenforceable   in   any
jurisdiction  shall, as to such jurisdiction, be  ineffective  to
the  extent  of  such  prohibition  or  unenforceability  without
invalidating  the  remaining  provisions  hereof,  and  any  such
prohibition  or  unenforceability in any jurisdiction  shall  not
invalidate  or render unenforceable such provision in  any  other
jurisdiction.

          SECTION 10.6.    Successors and Assigns.
          
          (a)  This Agreement shall be binding on the parties hereto and
their respective successors and assigns; provided, however,  that
neither  the  Transferor nor the Seller  may assign  any  of  its
rights  or  delegate  any of its duties hereunder  or  under  the
Receivables  Purchase  Agreement  or  under  any  of  the   other
Transaction  Documents to which it is a party without  the  prior
written  consent  of the Agent.  No provision of  this  Agreement
shall  in any manner restrict the ability of the Company  or  any
Bank  Investor  to assign, participate, grant security  interests
in,   or  otherwise  transfer  any  portion  of  the  Transferred
Interest.

(b)  Each of the Transferor and the Seller  hereby agrees and
consents to the assignment by the Company from time to time of
all or any part of its rights under, interest in and title to
this Agreement and the Transferred Interest to any Liquidity
Provider.  In addition, each of the Transferor and the Seller
hereby consents to and acknowledges the assignment by the Company
of all of its rights under, interest in and title to this
Agreement and the Transferred Interest to the Collateral Agent.
          SECTION 10.7.    Waiver of Confidentiality.
          
               Each  of  the  Transferor and the  Seller   hereby
consents  to  the  disclosure of any nonpublic  information  with
respect  to  it received by the Company, the Agent  or  any  Bank
Investor  to  any  of  the  Company, the  Agent,  any  nationally
recognized  rating agency rating the Company's Commercial  Paper,
the  Collateral  Agent,  any  Bank  Investor  or  potential  Bank
Investor,  the Liquidity Provider or the Credit Support  Provider
in  relation to this Agreement; provided, that the Agent will use
its  best  efforts to obtain executed confidentiality  agreements
covering  the  disclosure  of any such information  to  any  Bank
Investor,  potential Bank Investor, Liquidity Provider or  Credit
Support Provider other than the Agent.

          SECTION 10.8.    Confidentiality Agreement.
          
               Each  of  the Transferor and the Collection  Agent
hereby  agrees  that it will not disclose the  contents  of  this
Agreement or any other proprietary or confidential information of
the  Company,  the  Agent, the Collateral  Agent,  any  Liquidity
Provider or any Bank Investor to any other Person except (i)  its
auditors  and  attorneys, employees or financial advisors  (other
than  any  commercial bank) and any nationally recognized  rating
agency,  provided such auditors, attorneys, employees,  financial
advisors   or  rating  agencies  are  informed  of   the   highly
confidential  nature  of such information or  (ii)  as  otherwise
required  by  applicable law or order of  a  court  of  competent
jurisdiction.

          SECTION 10.9.    No Bankruptcy Petition Against the Company.
          
               Each  of  the Transferor and the Collection  Agent
hereby covenants and agrees that, prior to the date which is  one
year  and  one  day after the payment in full of all  outstanding
Commercial  Paper or other indebtedness of the Company,  it  will
not  institute  against, or join any other Person in  instituting
against, the Company any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings or other similar proceeding
under  the  laws of the United States or any state of the  United
States.

          SECTION 10.10.   No Recourse Against Stockholders, Officers or
          Directors.
          
               No  recourse  under  any obligation,  covenant  or
agreement of the Company contained in this Agreement shall be had
against  Lord Securities Corporation (or any affiliate  thereof),
or  any stockholder, officer or director of the Company, as such,
by the enforcement of any assessment or by any legal or equitable
proceeding,  by  virtue  of any statute or  otherwise;  it  being
expressly agreed and understood that this Agreement is  solely  a
corporate  obligation  of  the  Company,  and  that  no  personal
liability  whatsoever  shall attach to or  be  incurred  by  Lord
Securities  Corporation  (or  any  affiliate  thereof),  or   the
stockholders, officers or directors of the Company, as  such,  or
any  of  them,  under  or by reason of any  of  the  obligations,
covenants  or  agreements  of  the  Company  contained  in   this
Agreement,  or implied therefrom, and that any and  all  personal
liability for breaches by the Company of any of such obligations,
covenants or agreements, either at common law or at equity, or by
statute  or constitution, of Lord Securities Corporation (or  any
affiliate  thereof)  and  every  such  stockholder,  officer   or
director of the Company is hereby expressly waived as a condition
of and consideration for the execution of this Agreement.

          SECTION 10.11.   Characterization of the Transactions
          Contemplated by the Agreement.
          
               It  is  the  intention  of the  parties  that  the
transactions  contemplated  hereby constitute  the  sale  of  the
Transferred Interest, conveying good title thereto free and clear
of  any Adverse Claims to the Agent, on behalf of the Company and
the Bank Investors, and that the Transferred Interest not be part
of  the  Transferor's estate in the event of an insolvency.   If,
notwithstanding  the  foregoing,  the  transactions  contemplated
hereby should be deemed a financing, the parties intend that  the
Transferor  shall  be deemed to have granted  to  the  Agent,  on
behalf  of the Company and the Bank Investors, and the Transferor
hereby grants to the Agent, on behalf of the Company and the Bank
Investors,  a  first  priority perfected and continuing  security
interest in all of the Transferor's right, title and interest in,
to  and  under  the  Receivables, together with  Collections  and
Proceeds  with  respect thereto, and together  with  all  of  the
Transferor's  rights under the Receivables Purchase Agreement  to
which  it  is  a party with respect to the Receivables  and  with
respect  to any obligations thereunder of the Seller with respect
to  the  Receivables, and that this Agreement shall constitute  a
security  agreement under applicable law.  The Transferor  hereby
assigns  to  the  Agent, on behalf of the Company  and  the  Bank
Investors,  all of its rights and remedies under the  Receivables
Purchase  Agreement to which it is a party with  respect  to  the
Receivables and with respect to any obligations thereunder of the
Sellers with respect to the Receivables.

               
               
               IN   WITNESS  WHEREOF,  the  parties  hereto  have
executed  and delivered the Transfer and Administration Agreement
as of the date first written above.

                              KITTY HAWK FUNDING CORPORATION,
                                    as Company
               
                              By:
____________________________________
                                    Name:
                                     Title:
               
                              METRIS FUNDING CO.,
                                   as Transferor
               
                              By:
____________________________________
                                 Name:
                                 Title:
               
                              DIRECT MERCHANTS CREDIT CARD BANK,
                                   NATIONAL ASSOCIATION,
                                   as Collection Agent
               
               
               By:______________________________________
                                   Name:
                                   Title:
               
                              NATIONSBANK, N.A.,
                                   as a Bank Investor
               
                              By:
______________________________________
                                  Name:
                                  Title:
               
                              NATIONSBANK, N.A.,
                                   as Agent
               
                              By:
______________________________________
                                  Name:
                                  Title:
               
                        TABLE OF CONTENTS
                                
                                                             Page
                                                                 
            TRANSFER AND ADMINISTRATION AGREEMENT               1
                    PRELIMINARY STATEMENTS                      1

                          ARTICLE I
                         DEFINITIONS                            1
SECTION 1.1.                               CERTAIN DEFINED TERMS.     1
SECTION 1.2.                                         OTHER TERMS.     19
SECTION 1.3.                         COMPUTATION OF TIME PERIODS.     19

                         ARTICLE I I                           19
                  PURCHASES AND SETTLEMENTS                    19
SECTION 2.1.                                            FACILITY.     19
SECTION 2.2.       TRANSFERS; CERTIFICATES; ELIGIBLE RECEIVABLES.     20
SECTION 2.3.   SELECTION OF INTEREST RATES AND INTEREST PERIODS;
            EURODOLLAR PROTECTION; ILLEGALITY.                 23
SECTION 2.4.   CARRYING COSTS, FEES AND OTHER COSTS AND EXPENSES.     25
SECTION 2.5.          ALLOCATIONS OF COLLECTIONS; NON-LIQUIDATION
            SETTLEMENT AND REINVESTMENT PROCEDURES; SERVICER
            ADVANCES.                                          26
SECTION 2.6.                   LIQUIDATION SETTLEMENT PROCEDURES.     28
SECTION 2.7.                                                FEES.     29
SECTION 2.8.      PROTECTION OF OWNERSHIP INTEREST OF THE COMPANY
            AND THE BANK INVESTORS.                            29
SECTION 2.9.                             APPLICATION OF PAYMENTS.     30
SECTION 2.10.                     PAYMENTS AND COMPUTATIONS, ETC.     31
SECTION 2.11.                                            REPORTS.     31
SECTION 2.12.              COLLECTION ACCOUNT AND SPREAD ACCOUNT.     32
SECTION 2.13.                           SHARING OF PAYMENTS, ETC.     33
SECTION 2.14.                                    RIGHT OF SETOFF.     33

                         ARTICLE I II                          34
            REPRESENTATIONS AND WARRANTIES                     34
SECTION 3.1.    REPRESENTATIONS AND WARRANTIES OF THE TRANSFEROR.     34
SECTION 3.2.     REAFFIRMATION OF REPRESENTATIONS AND WARRANTIES
            BY THE TRANSFEROR.                                 38
SECTION 3.3.    REPRESENTATIONS AND WARRANTIES OF THE COLLECTION
            AGENT.                                             38

                         ARTICLE I V                           40
                     CONDITIONS PRECEDENT                      40
SECTION 4.1.  CONDITIONS TO CLOSING.  ON OR PRIOR TO THE DATE OF
            EXECUTION HEREOF, THE TRANSFEROR SHALL DELIVER TO
            THE AGENT THE FOLLOWING DOCUMENTS, INSTRUMENTS
            AND FEES, ALL OF WHICH SHALL BE IN A FORM AND
            SUBSTANCE ACCEPTABLE TO THE AGENT:                 40

                          ARTICLE V                            43
                          COVENANTS                            43
SECTION 5.1.                 AFFIRMATIVE COVENANTS OF TRANSFEROR.     43
SECTION 5.2.                NEGATIVE COVENANTS OF THE TRANSFEROR.     48
SECTION 5.3.       AFFIRMATIVE COVENANTS OF THE COLLECTION AGENT.     50
SECTION 5.4.          NEGATIVE COVENANTS OF THE COLLECTION AGENT.     52

                          ARTICLE VI                           53
                ADMINISTRATION AND COLLECTIONS                 53
SECTION 6.1.                     APPOINTMENT OF COLLECTION AGENT.     53
SECTION 6.2.                          DUTIES OF COLLECTION AGENT.     53
SECTION 6.3.    RIGHTS AFTER DESIGNATION OF NEW COLLECTION AGENT.     55
SECTION 6.4.                            COLLECTION AGENT DEFAULT.     55
SECTION 6.5.   RESPONSIBILITIES OF THE TRANSFEROR AND THE SELLER.     56

                         ARTICLE VII                           57
                      TERMINATION EVENTS                       57
SECTION 7.1.                                  TERMINATION EVENTS.     57
SECTION 7.2.                                         TERMINATION.     59

                         ARTICLE VIII                          59
          INDEMNIFICATION; EXPENSES; RELATED MATTERS           59
SECTION 8.1.                       INDEMNITIES BY THE TRANSFEROR.     59
SECTION 8.2.          INDEMNITY FOR TAXES, RESERVES AND EXPENSES.     62
SECTION 8.3.                                               TAXES.     64
SECTION 8.4.           OTHER COSTS, EXPENSES AND RELATED MATTERS.     65
SECTION 8.5.            RECONVEYANCE UNDER CERTAIN CIRCUMSTANCES.     66

                          ARTICLE IX                           66
                  THE AGENT; BANK COMMITMENT                   66
SECTION 9.1.                            AUTHORIZATION AND ACTION.     66
SECTION 9.2.                               AGENT'S RELIANCE, ETC.     67
SECTION 9.3.                                     CREDIT DECISION.     68
SECTION 9.4.                        INDEMNIFICATION OF THE AGENT.     68
SECTION 9.5.                                     SUCCESSOR AGENT.     69
SECTION 9.6.                               PAYMENTS BY THE AGENT.     69
SECTION 9.7.       BANK COMMITMENT; ASSIGNMENT TO BANK INVESTORS.     69

                          ARTICLE X                            73
                        MISCELLANEOUS                          73
SECTION 10.1.                                  TERM OF AGREEMENT.     73
SECTION 10.2.                                WAIVERS; AMENDMENTS.     73
SECTION 10.3.                                            NOTICES.     73
SECTION 10.4.          GOVERNING LAW; SUBMISSION TO JURISDICTION;
            INTEGRATION.                                       75
SECTION 10.5.                         SEVERABILITY; COUNTERPARTS.     76
SECTION 10.6.                             SUCCESSORS AND ASSIGNS.     76
SECTION 10.7.                          WAIVER OF CONFIDENTIALITY.     77
SECTION 10.8.                          CONFIDENTIALITY AGREEMENT.     77
SECTION 10.9.         NO BANKRUPTCY PETITION AGAINST THE COMPANY.     77
SECTION 10.10.      NO RECOURSE AGAINST STOCKHOLDERS, OFFICERS OR
            DIRECTORS.                                         77
SECTION 10.11.  CHARACTERIZATION OF THE TRANSACTIONS CONTEMPLATED
            BY THE AGREEMENT.                                  78

EXHIBIT A Form of Additional Investment Certificate

EXHIBIT   B                          Form   of   Assignment   and
Assumption Agreement

EXHIBIT C Form of Agreed Upon Procedures

EXHIBIT D Form of Investor Report

EXHIBIT E Form of Certificate

EXHIBIT F Form of Transfer Certificate

EXHIBIT G Location of Records

EXHIBIT H List of Subsidiaries, Divisions and Tradenames







                                

              TRANSFER AND ADMINISTRATION AGREEMENT

                              among

                 KITTY HAWK FUNDING CORPORATION

                         as the Company,

                       METRIS FUNDING CO.,

                       as the Transferor,

    DIRECT MERCHANTS CREDIT CARD BANK, NATIONAL ASSOCIATION,

                     as the Collection Agent

                               and

                        NATIONSBANK, N.A.

                 as the Agent and Bank Investor

                  Dated as of October 23, 1997

                                

                      MERCANTILE PORTFOLIO
                                
                                
                                


               
               
               
               
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