FIRST AMENDMENT TO STEAM PURCHASE CONTRACT
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         FIRST  AMENDMENT TO STEAM PURCHASE  CONTRACT dated as of August 1, 1991
(the "First  Amendment"),  to the Steam Purchase  Contract (the "Steam  Purchase
Contract") dated as of November 30, 1984, by and between GUILFORD MILLS, Inc., a
Delaware corporation ("Buyer"),  and COGENTRIX OF NORTH CAROLINA,  INC., a North
Carolina  corporation and the successor by merger to Cogentrix  Carolina Leasing
Corporation  ("Cogentrix").  Terms used herein which are not defined are used as
defined in the Steam Purchase Contract.

                               W I T N E S E T H:
                               - - - - - - - - -

         WHEREAS,  the Buyer and  Cogentrix  have  agreed to revise the  pricing
formula for steam purchased by the Buyer from Cogentrix at the Buyer's Plant.

         NOW,  THEREFORE,  in consideration of the mutual  agreements  contained
herein and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Buyer and Cogentrix hereby agree as follows:

         1.  Amendments  to Steam  Purchase  Contract.  (a) The  Steam  Purchase
Contract is hereby amended by adding an additional  clause (iii) in Section 5(a)
thereof which clause reads as follows:

         (iii)  Cogentrix  and the Buyer agree to work together in good faith to
         explore means by which the Buyer's ,steam cost can be minimized without
         jeopardizing  the  revenues  of  the  Cogeneration  Facility.  Each  of
         Cogentrix and the Buyer further agrees to use best efforts to develop a
         plan no later than August 1, 1992 to achieve this goal.

         (b) The Steam Purchase  Contract is hereby amended by deleting  section
5(b) in its entirety and substituting the following therefor:

         (b) For the period beginning August 1, 1991 and continuing through July
         31, 1992,  the price for low pressure steam shall be $5.20 per thousand
         pounds.  For the period beginning August 1, 1992 and continuing through
         July 31,  1993,  the price for low  pressure  steam  shall be $5.40 per
         thousand pounds. For the period beginning August 1, 1991 and continuing
         through July 31, 1992, the price for high pressure steam shall be $4.24
         per  MMBTU.  For the  period  beginning  August 1, 1992 and  continuing
         through July 31, 1993, the price for high pressure steam shall be $4.41
         per MMBTU.  Commencing on August 1, 1993,  and on the first day of each
         Term Year  thereafter,  new purchase rates for steam and BTU's shall be
         computed  based on the  percentage  increase,  if any, in the Delivered
         Cost of Coal (as  hereinafter  defined)  from  August 1, 1985.  The new
         purchase rates for steam and BTU's shall be computed by multiplying, in
         the case of Paragraph 5 (a) (i) above, $5.10 per thousand pounds,  and,
         in the case of Paragraph 5 (a) (ii) above,  the rate set forth therein,
         whichever  is  applicable  (the  "Base  Rate")  times a  fraction,  the
         numerator of which shall be the Delivered Cost of Coal in effect on the

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         first day of the Term Year for which such calculation is being made and
         the  denominator of which shall be the Delivered Cost of Coal on August
         1, 1985. As used herein,  the  "Delivered  Cost of Coal" shall refer to
         the total price per ton paid by  Cogentrix to purchase  coal  including
         the  transportation  cost  per ton  for  delivery  to the  Cogeneration
         Facility. In no event shall such purchase prices be less than either of
         the Base Rates.

         2. Full Force and Effect. Except as modified hereby, the Steam Purchase
Contract has not been amended  or-modified and is and shall remain in full force
and affect.

         3. Definitions. Capitalized terms used herein and not otherwise defined
shall have the meanings assigned to them in the Steam Purchase Contract.

         4. Counterparts.  This First Amendment may be executed in any number of
counterparts,  each of which when so executed and  delivered  shall be deemed an
original,  and it shall not be necessary in making proof of this First Amendment
to produce or account for more than one such counterpart.

         5. Governing law. This First Amendment and the Steam Purchase Contract,
as  'amended  hereby,  shall be deemed to be  contracts  made  under and for all
purposes  shall be construed in accordance  with, the laws of the State of North
Carolina.


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IN WITNESS WHEREOF, the undersigned have each caused this First Amendment to be
duly executed by the duly authorized officers and their corporate seal to be
here unto affixed and attached, all as of the year and day first above written.

                                               GUILFORD MILLS, INC.

                                               By: /s/
                                                  ------------------------------

                                               Title /s/
                                                    ----------------------------
ATTEST:

By: /s/
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Title /s/
     ----------------------------
         [Corporate Seal]                      COGENTRIX OF NORTH CAROLINA, INC.

                                               By: /s/
                                                  ------------------------------

                                               Title /s/
                                                    ----------------------------

ATTEST:

By: /s/
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Title /s/
     ----------------------------
         [Corporate Seal]