AMENDMENT #2 TO CREDIT AND SECURITY AGREEMENT



Exhibit No. 10.37




AMENDMENT
#2 TO CREDIT AND SECURITY AGREEMENT


THIS AMENDMENT #2  (this "Amendment") is entered into by the undersigned parties as of July
19, 2002 with respect to the Credit and Security Agreement dated as of October
25, 2000 (as amended, the "Credit and Security Agreement") by and among
Mohawk Factoring, Inc., a Delaware corporation ("Borrower"), Mohawk
Servicing, Inc., a Delaware corporation, as initial Servicer, Blue Ridge Asset
Funding Corporation, a Delaware corporation, and Wachovia Bank, National
Association, individually and as Agent. 

Unless defined elsewhere herein,
capitalized terms used in this Amendment shall have the meanings assigned to
such terms in the Credit and Security Agreement.


PRELIMINARY
STATEMENT


On
the terms and subject to the conditions hereinafter set forth, each of the
parties wishes to amend the Credit and Security Agreement amend the definition
of Receivable.


NOW, THEREFORE, in consideration of the
premises and the mutual agreements herein contained and other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
parties hereto agree as follows:


1.             Amendment.  The definition of "Receivable" in the
Credit and Security Agreement is hereby amended by amending the first proviso to
read "provided, however, in no event shall the term "Receivable" include
any Receivable for which any of Kmart Corporation (including without
limitation, Kmart Corporation d/b/a Kmart Fashions), Builders Square, Inc. or
Sourcing & Technical Services, Inc., is the Obligor or any Receivable
coming into existence after the Facility Termination Date.


2.             Conditions Precedent to
Effectiveness.  The effectiveness of
this Amendment is subject to the conditions precedent that the Agent shall have
received counterparts hereof duly executed by each of the parties to the Credit
and Security Agreement.


3.             Scope of Amendment. Except as
expressly amended hereby, the Credit and Security Agreement remains in full
force and effect in accordance with its terms and this Amendment to the Credit
and Security Agreement shall not by implication or otherwise alter, modify,
amend or in any way affect any of the terms, conditions, obligations, covenants
or agreements contained in the Credit and Security Agreement, all of which are ratified
and affirmed in all respects and shall continue in full force and effect. 
 


4.             Governing Law. This Amendment and
the Credit and Security Agreement as amended hereby shall be governed by and
construed in accordance with the laws of the State of Georgia.


5.             Counterparts.  This Amendment may be executed in any number
of counterparts and each of such counterparts shall for all purposes be deemed
an original, and all such counterparts shall together constitute but one and
the same instrument.


6.             No Rating Agency Condition.  By signing below, the Agent confirms that
this Amendment will not require satisfaction of the Rating Agency Condition.


<signature
pages follow>


 IN
WITNESS WHEREOF, the parties hereto have caused this Amendment #2 to Credit and
Security Agreement to be executed and delivered by their duly authorized
officers as of the date hereof.


MOHAWK
FACTORING, INC.






By:                                                                                         
 


Name:  ______________________________


Title:  _______________________________








MOHAWK
SERVICING, INC.






By:                                                                                         
 


Name:                                                                                     
 


Title:        
                                                                               
 






BLUE
RIDGE ASSET FUNDING CORPORATION




BY:  WACHOVIA BANK, NATIONAL ASSOCIATION,
 ITS ATTORNEY-IN-FACT






By:  __________________________________


                Name: 
 


                Title:   
 






WACHOVIA
BANK, NATIONAL ASSOCIATION, as Sole Liquidity Bank and as Agent






By:                                                                                         
 


Name:


Title: