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                                                                   EXHIBIT 10.49

                                                                  EXECUTION COPY

                         RECEIVABLES PURCHASE AGREEMENT


                          dated as of December 18, 1998


                                 by and between


                             WESTPOINT STEVENS INC.,

                                    as Seller


                                       and


                          WPS RECEIVABLES CORPORATION,
                                  as Purchaser



<PAGE>   2



                                TABLE OF CONTENTS


<TABLE>
<CAPTION>
                                                                                                        Page
<S>  <C>                   <C>                                                                          <C>
                                                ARTICLE I
                                     AGREEMENT TO PURCHASE AND SELL....................................  2
1.1  Agreement to Purchase and Sell....................................................................  2
1.2  Timing of Purchases...............................................................................  3
1.3  Consideration for Purchases.......................................................................  3
1.4  No Recourse.......................................................................................  3
1.5  No Assumption of Obligations Relating to
     Receivables, Related Assets or Contracts..........................................................  3
1.6  True Sales........................................................................................  4
1.7  Savings Clause....................................................................................  4
1.8  Addition of Sellers...............................................................................  4
1.9  Termination of Status as a Seller.................................................................  5

                                                ARTICLE II
                                      CALCULATION OF PURCHASE PRICE....................................  6
2.1  Calculation of Purchase Price.....................................................................  6
2.2  Definitions and Calculations Related to Purchase
     Price Percentage..................................................................................  7

                                                ARTICLE III
                                 PAYMENT OF PURCHASE PRICE; SERVICING, ETC.............................  8
3.1  Purchase Price Payments...........................................................................  8
3.2  The WPS Finco Note................................................................................  9
3.3  Application of Collections and Other Funds........................................................ 10
3.4  Servicing of Receivables and Related Assets....................................................... 10
3.5  Payments and Computations, Etc.................................................................... 11

                                                ARTICLE IV
                                         CONDITIONS TO PURCHASES....................................... 11
4.1  Conditions Precedent to Initial Purchase.......................................................... 11
4.2  Certification as to Representations and
     Warranties........................................................................................ 12
4.3  Effect of Payment of Purchase Price............................................................... 12

                                                ARTICLE V
                                     REPRESENTATIONS AND WARRANTIES.................................... 13
5.1  Representations and Warranties of Seller.......................................................... 13
5.2  Representations and Warranties of WPS Finco....................................................... 20

                                                ARTICLE VI
                                      GENERAL COVENANTS OF SELLER...................................... 20
6.1  Affirmative Covenants............................................................................. 20
6.2  Reporting Requirements............................................................................ 24
6.3  Negative Covenants................................................................................ 28
</TABLE>


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<TABLE>
<CAPTION>
                                                                                                        Page
<S>  <C>                  <C>                                                                           <C>
                                                ARTICLE VII
                                   ADDITIONAL RIGHTS AND OBLIGATIONS IN
                                     RESPECT OF THE TRANSFERRED ASSETS................................. 31
7.1  Rights of WPS Finco............................................................................... 31
7.2  Responsibilities of Seller........................................................................ 32
7.3  Further Action Evidencing Purchases............................................................... 32
7.4  Collection of Receivables; Rights of WPS Finco and Its Assignees.................................. 34

                                               ARTICLE VIII
                                               TERMINATION............................................. 35
8.1  Termination by Seller............................................................................. 35
8.2  Automatic Termination............................................................................. 35

                                                ARTICLE IX
                                             INDEMNIFICATION........................................... 35
9.1  Indemnities by Seller............................................................................. 35
9.2. Contribution...................................................................................... 37

                                                ARTICLE X
                                              MISCELLANEOUS............................................ 38
10.1  Amendments; Waivers, Etc......................................................................... 38
10.2  Notices, Etc..................................................................................... 38
10.3  Cumulative Remedies.............................................................................. 39
10.4  Binding Effect; Assignability; Survival of
      Provisions....................................................................................... 39
10.5  Governing Law.................................................................................... 39
10.6  Costs, Expenses and Taxes........................................................................ 40
10.7  Consent to Jurisdiction; Waiver of Immunities.................................................... 40
10.8  Waiver of Jury Trial............................................................................. 41
10.9  Integration...................................................................................... 41
10.10  Execution in Counterparts....................................................................... 41
10.11  Acknowledgment and Consent...................................................................... 41
10.12  No Partnership or Joint Venture................................................................. 42
10.13  No Proceedings.................................................................................. 42
10.14  Severability of Provisions...................................................................... 42
10.15  Recourse to WPS Finco........................................................................... 43
</TABLE>


                                          ii

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                                    EXHIBITS


EXHIBIT 3.2                          Form of WPS Finco Note

                                    SCHEDULES

SCHEDULE 5.1(f)                      Litigation and Other Proceedings

SCHEDULE 5.1(n)                      Offices of the Sellers where Records are
                                     Maintained

SCHEDULE 5.1(o)                      Lock-Box Banks and Accounts

SCHEDULE 5.1(q)                      Legal Names


                                   APPENDICES

APPENDIX A                           Definitions


                                      iii

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         THIS RECEIVABLES PURCHASE AGREEMENT (this "Purchase Agreement"), dated
as of December 18, 1998, is made by and between WestPoint Stevens Inc., a
Delaware corporation ("Seller"), and WPS Receivables Corporation, a Delaware
corporation ("WPS Finco"). Except as otherwise specifically provided herein,
capitalized terms used in this Purchase Agreement have the meanings ascribed to
such terms in Appendix A hereto, and this Purchase Agreement shall be
interpreted in accordance with the conventions set forth in Parts B, C and D of
Appendix A.

                               W I T N E S S E T H

         WHEREAS, Seller and WPS Finco entered into a Receivables Purchase
Agreement dated as of December 10, 1993 and amended and restated as of May 27,
1994 (the "Original Purchase Agreement"), pursuant to which Seller agreed to
sell Receivables that it owned on December 10, 1993 and from time to time
thereafter owned, to WPS Finco, and WPS Finco agreed to purchase such
Receivables from Seller from time to time; and

         WHEREAS, Seller exercised its termination rights under Section 8.1 of
the Original Purchase Agreement and terminated such agreement;

         WHEREAS, WPS Finco continues to own all Receivable outstanding as of
the close of business on the Effective Date and conveyed pursuant to the
Original Purchase Agreement. (such Receivables, the "Previously Transferred
Receivables");

         WHEREAS, Seller and WPS Finco desire to enter into a new Receivables
Purchase Agreement pursuant to which Seller will sell Receivables that it owns
on the Effective Date and from time to time thereafter owns, to WPS Finco, and
WPS Finco will purchase such Receivables from Seller on the Effective Date and
thereafter from time to time, in each case, on the terms and conditions set
forth herein; and

         WHEREAS, concurrent with this Purchase Agreement, WPS Finco, as
Transferor, Seller, as Servicer, Blue Ridge Asset Funding Corporation, as
Transferee ("Blue Ridge"), and Wachovia Bank, N.A., as Administrator (the
"Administrator"), are entering into an Asset Interest Transfer Agreement
pursuant to which WPS Finco will transfer to Blue Ridge an undivided interest in
Pool Receivables and Related Assets (as defined therein), in order to, among
other things, finance WPS Finco's purchases hereunder.



<PAGE>   6



         NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, agree as follows:


                                    ARTICLE I

                         AGREEMENT TO PURCHASE AND SELL

         SECTION 1.1 Agreement to Purchase and Sell. On the terms and subject to
the conditions set forth in this Purchase Agreement (including the conditions to
purchases set forth in Article IV), Seller agrees to sell, transfer, assign, set
over and otherwise convey, and does hereby sell, to WPS Finco, and WPS Finco
agrees to purchase, and does hereby purchase, from Seller, at the times set
forth in Section 1.2, all of Seller's right, title and interest in, to and
under:

         (a)      each Receivable of Seller that exists and is owing to Seller
                  as at the closing of Seller's business on the Effective Date
                  (other than the Previously Transferred
                  Receivables),

         (b)      each Receivable created by Seller that arises during the
                  period from and including the closing of Seller's business on
                  the Effective Date but excluding the Purchase Termination
                  Date,

         (c)      all Related Security with respect to all Receivables
                  described above,

         (d)      all proceeds of the foregoing, including all funds
                  received by any Person in payment of any amounts owed
                  (including invoice prices, finance charges, interest
                  and all other charges, if any) in respect of any
                  Receivable described above or Related Security with
                  respect to any such Receivable, or otherwise applied to
                  repay or discharge any such Receivable (including
                  insurance payments that Seller or the Servicer applies
                  in the ordinary course of its business to amounts owed
                  in respect of any such Receivable (it being understood
                  that property insurance covering inventory is not so
                  applied and is not included in this grant) and net
                  proceeds of sale or other disposition of repossessed
                  goods that were the subject of any such Receivable) or
                  other collateral or property of any Obligor or any
                  other party directly or indirectly liable for payment
                  of such Receivables), and


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         (e)      all Records relating to any of the foregoing; provided that
                  the Seller shall be entitled to retain duplicates of such
                  Records.

         As used herein, (i) "Purchased Receivables" means the items listed
above in clauses (a) and (b) and the Previously Transferred Receivables; (ii)
"Related Assets" means the items listed above in clauses (c), (d) and (e); and
(iii) "Transferred Assets" means the Purchased Receivables and the Related
Assets.

         SECTION 1.2 Timing of Purchases.

         (a) Effective Date Purchases. All of the Transferred Assets of Seller,
other than the Previously Transferred Receivables (which have been previously
transferred to WPS Finco) existing at the closing of its business on the
Effective Date automatically (and without further action by any Person) shall be
sold to WPS Finco on the Effective Date.

         (b) Regular Purchases. Except to the extent otherwise provided in
Section 8.2, after the closing of Seller's business on the Effective Date until
the closing of Seller's business on the Business Day immediately preceding the
Purchase Termination Date, each Receivable and the Related Assets of Seller
shall be deemed to have been sold to WPS Finco pursuant hereto immediately (and
without further action by any Person) upon the creation of such Receivable.

         SECTION 1.3 Consideration for Purchases. On the terms and subject to
the conditions set forth in this Purchase Agreement, WPS Finco agrees to make
Purchase Price payments to Seller in accordance with Article III.

         SECTION 1.4 No Recourse. Except as specifically provided in this
Purchase Agreement, the sale and purchase of Transferred Assets under this
Purchase Agreement shall be without recourse to Seller; it being understood that
Seller shall be liable to WPS Finco for all representations, warranties,
covenants and indemnities made by Seller pursuant to the terms of this Purchase
Agreement, all of which obligations are limited so as not to constitute recourse
to Seller for the credit risk of the Obligors.

         SECTION 1.5 No Assumption of Obligations Relating to Receivables,
Related Assets or Contracts. Neither WPS Finco, nor the Servicer, nor any of
their respective assigns, shall have any obligation or liability to any Obligor
or other customer or client of Seller (including any obligation to perform any
of the obligations of Seller under any Receivable, related Contracts or any
other related purchase orders or other agreements). No such



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obligation or liability is intended to be assumed hereunder by WPS Finco, the
Servicer, or any of their respective assigns, and any such assumption is
expressly disclaimed.

         SECTION 1.6 True Sales. Seller and WPS Finco intend the transfers of
Receivables hereunder to be true sales by Seller to WPS Finco that are absolute
and irrevocable and that provide WPS Finco with the full benefits of ownership
of the Receivables, and neither Seller nor WPS Finco intends the transactions
contemplated hereunder to be, or for any purpose to be characterized as, loans
from WPS Finco to Seller.

         SECTION 1.7 Savings Clause.

         If, notwithstanding the intention of the parties expressed in Section
1.6 above, the conveyance by Seller to WPS Finco of Receivables hereunder shall
be characterized as a secured loan and not a sale, this Purchase Agreement shall
constitute a security agreement under the UCC and other applicable law. For this
purpose, Seller hereby grants WPS Finco a duly perfected, first priority
security interest in all of Seller's right, title and interest in, to and under
the Receivables and the Related Security with respect thereto, this Purchase
Agreement and all proceeds of any thereof, to secure the timely payment and
performance by Seller of all amounts owing to WPS Finco hereunder and any other
obligations owing to WPS Finco hereunder. In the event this Purchase Agreement
shall be characterized as a security agreement and upon a default by Seller
hereunder, WPS Finco and its assignees shall have, in addition to the rights and
remedies which they may have under this Purchase Agreement, all other rights and
remedies provided to a secured creditor after default under the UCC and other
applicable law, which rights and remedies shall be cumulative.

         SECTION 1.8 Addition of Sellers. Any Subsidiary of WestPoint Stevens
may become an additional Seller hereunder and sell its accounts receivable and
property of the types that constitute Receivables and Related Assets hereunder
to WPS Finco if the Administrator (on behalf of Blue Ridge) consents to such
addition. WestPoint Stevens and its Subsidiary that is proposed to be added as a
Seller shall give to WPS Finco and the Administrator no less than forty-five
days' prior written notice of the effective date of the addition of such
Subsidiary as a Seller, and such Subsidiary shall provide the Administrator (on
behalf of Blue Ridge) with reasonable access to its officers and to its books,
records and accounting systems to enable the Administrator to conduct a due
diligence review of the accounts receivable and accounting systems of such
Subsidiary. Upon the Administrator granting its consent to the proposed
addition, such addition shall become effective on the first Business Day



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following the date on which the Subsidiary and the parties hereto shall have
executed and delivered such agreements, instruments and other documents and such
amendments or other modifications to the Transaction Documents, in form and
substance reasonably satisfactory to WPS Finco and the Administrator, that WPS
Finco or the Administrator reasonably determines are necessary or appropriate to
effect such addition.

         SECTION 1.9 Termination of Status as a Seller. (a) At any time when
more than one Person is a Seller, a Seller (other than WestPoint Stevens) may
terminate its obligation to sell its Receivables and Related Assets to WPS Finco
if:

         (i)      such Seller (a "Terminating Seller") shall have given WPS
                  Finco no less than thirty days' prior written notice of such
                  Seller's intention to terminate such obligations;

         (ii)     an Authorized Officer of the Terminating Seller shall have
                  certified that the termination by the Terminating Seller of
                  its status as a Seller will not have a Material Adverse
                  Effect; and

         (iii)    both immediately before and after giving effect to such
                  termination by the Terminating Seller, no Liquidation Event or
                  Unmatured Liquidation Event shall have occurred and be
                  continuing or shall reasonably be expected to occur.

         Any termination by a Seller pursuant to this Section 1.9(a) shall
become effective on the first Business Day that follows the day on which the
requirements of foregoing clauses (a)(i) through (iii) shall have been satisfied
(or such later date specified in the notice or certificate referred to in such
clauses). Any termination by a Seller pursuant to this Section 1.9(a) shall
terminate such Seller's right and obligation to sell Receivables and Related
Assets hereunder to WPS Finco and WPS Finco's agreement, with respect to such
Seller, to purchase such Receivables and Related Assets; provided, however, that
such termination shall not relieve such Seller of any of its other Obligations,
to the extent such Obligations relate to Receivables (and Related Assets with
respect thereto) originated by such Seller prior to the effective date of such
termination.

         (b) The right and obligation of a Seller (other than WestPoint Stevens)
to sell its Receivables and Related Assets to WPS Finco shall terminate
immediately if such Seller ceases to be a Subsidiary of WestPoint Stevens;
provided, however, that such termination shall not relieve such Seller of any of
its other



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Obligations, to the extent such Obligations relate to Receivables (and Related
Assets with respect thereto) originated by such Seller prior to the effective
date of such termination.


                                   ARTICLE II

                          CALCULATION OF PURCHASE PRICE

         SECTION 2.1 Calculation of Purchase Price. On the Effective Date, and
thereafter on each Reporting Date, the Servicer shall deliver to WPS Finco, the
Administrator and Seller, a Monthly Report with respect to WPS Finco's purchases
of Receivables from Seller

                  (i) that are to be made on the Effective Date (in the case of
         the Monthly Report to be delivered on the Effective Date) or

                  (ii) that were made in the immediately preceding Reporting
         Period (in the case of each subsequent Monthly Report).

         On each day when Receivables are purchased by WPS Finco from Seller
pursuant to Article I hereof, the "Purchase Price" to be paid to Seller on such
day (in the case of the Effective Date), or on the next Business Day for the
Receivables and Related Assets that are to be sold by Seller on such day, shall
be determined in accordance with the following formula:

         PP       =        AUB x PPP

         where:

         PP       =        the aggregate Purchase Price for the Receivables
                           and Related Assets purchased from Seller on such
                           day,

         AUB      =        the "Aggregate Unpaid Balance" of the Receivables
                           that are to be purchased from Seller on such day.
                           For purposes of this calculation, "Aggregate
                           Unpaid Balance" shall mean (i) for purposes of
                           calculating the Purchase Price to be paid to
                           Seller on the Effective Date, the sum of the
                           Unpaid Balances of each Receivable generated by
                           Seller, as measured as at the closing of Seller's
                           business on the Effective Date, and (ii) for
                           purposes of calculating the Purchase Price to be
                           paid to Seller on each Business Day thereafter,
                           the sum of the Unpaid Balances of each Receivable


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                           to be purchased from Seller on such day,
                           calculated at the time of such Receivable's
                           generation and sale to WPS Finco,

         PPP      =        the Purchase Price Percentage applicable to the
                           Receivables purchased from Seller on such day, as
                           determined pursuant to Section 2.2.

         SECTION 2.2  Definitions and Calculations Related to
Purchase Price Percentage.

         (a) "Purchase Price Percentage" for the Receivables to be sold by
Seller on any day shall mean the percentage determined in accordance with the
following formula:

         PPP      =        100% - RRF

         where:

         PPP      =        the Purchase Price Percentage in effect on such
                           day

         RRF      =        the Required Reserve Factor (expressed as a 
                           percentage) determined as of the most recent 
                           Reporting Date, pursuant to paragraph (b) below.

The Purchase Price Percentage and the Required Reserve Factor shall be 
recomputed by the Servicer on each Reporting Date, in each case for the then 
most recent ended Reporting Period, and such recomputed amounts shall be used 
for purposes of calculating the Purchase Price payable to Seller for 
Receivables sold to WPS Finco through the next Reporting Date.



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                                   ARTICLE III

                   PAYMENT OF PURCHASE PRICE; SERVICING, ETC.

         SECTION 3.1  Purchase Price Payments.

         (a) On the Effective Date and on the Business Day following each day on
which any Receivables are purchased from Seller by WPS Finco pursuant to Article
I hereof, on the terms and subject to the conditions of this Purchase Agreement,
WPS Finco shall pay to Seller the Purchase Price for the Receivables and Related
Assets purchased on such day, by WPS Finco from Seller by (i) making a cash
payment to Seller to the extent that WPS Finco has cash available to make such
payment pursuant to Section 3.3 and (ii) automatically increasing the principal
amount outstanding under Seller's WPS Finco Note by the amount of the excess of
the Purchase Price to be paid to Seller for such Receivables and Related Assets
over the amount of any cash payment made on such day to Seller.

         (b) Non-Complying Receivables and Dilution Adjustment. If on any day

                  (i) the Unpaid Balance of any Receivable sold to WPS Finco by
Seller is:

                  (A)      reduced as a result of any defective, rejected or
                           returned merchandise or services, any cash discount,
                           incorrect billings, price rollbacks, freight charge
                           discrepancies or any other adjustment by Seller or
                           any Affiliate thereof, or as a result of any tariff
                           or other governmental or regulatory action, or

                  (B)      reduced or canceled as a result of a setoff in
                           respect of any claim by the Obligor thereof (whether
                           such claim arises out of the same or a related or an
                           unrelated transaction), or

                  (C)      reduced on account of the obligation of Seller or any
                           Affiliate thereof to pay to the related Obligor any
                           rebate or refund, or

                  (D)      less than the amount reported in the applicable
                           Monthly Report (for any reason



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                           other than such Receivable being paid by the Obligor
                           thereof or becoming a Defaulted Receivable), or

                  (ii) the representations and warranties made by Seller in
Section 5.1(k) with respect to such Receivable were not true when made,

then, the Purchase Price payable to Seller on the next Business Day or Days
shall be reduced as follows (such reduction, a "NonComplying Receivables and
Dilution Adjustment"):

                  (A)      in the case of clause (i) above, in the amount of
                           such reduction or cancellation or the difference
                           between the actual Unpaid Balance and the amount
                           reported in the applicable Monthly Report, as
                           applicable; and

                  (B)      in the case of clause (ii) above, in the amount of
                           the Unpaid Balance of such Receivable.

         (c) If, on any day on or after the Purchase Termination Date, there is
a positive Noncomplying Receivables and Dilution Adjustment and the principal
amount of the WPS Finco Note has been reduced to zero (or Seller no longer holds
the WPS Finco Note), Seller shall pay to WPS Finco in cash the amount of such
Noncomplying Receivables and Dilution Adjustment on the next succeeding Business
Day.

         SECTION 3.2 The WPS Finco Note.

         (a) On the Effective Date, WPS Finco shall deliver to Seller a
promissory note, substantially in the form of Exhibit 3.2, payable to the order
of Seller (such promissory note, as the same may be amended, supplemented,
endorsed or otherwise modified from time to time, together with any promissory
note issued from time to time in substitution therefor or renewal thereof in
accordance with the Transaction Documents, the "WPS Finco Note"), which WPS
Finco Note shall be subordinated to all payments now or hereafter arising under
or in connection with the Asset Interest Transfer Agreement. The WPS Finco Note
is payable in full on the date that is eighteen months after the Final Payout
Date under the Asset Interest Transfer Agreement. The WPS Finco Note shall bear
interest at a rate per annum equal to the Prime Rate in effect on the most
recent Reporting Date. WPS Finco may prepay all or part of the outstanding
balance of the WPS Finco Note from time to time without any premium or penalty,
unless such prepayment would result in a default in WPS Finco's payment of any
other amount required to be paid by it under any Transaction Document.


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         (b) The Servicer shall hold the WPS Finco Note for the benefit of
Seller, and shall make all appropriate recordkeeping entries with respect to the
WPS Finco Note or otherwise to reflect the payments on and adjustments thereto.
The Servicer's books and records shall constitute rebuttable presumptive
evidence of the principal amount of and accrued interest on the WPS Finco Note
at any time. Seller hereby irrevocably authorizes the Servicer to mark the WPS
Finco Note "CANCELLED" and to return the WPS Finco Note to WPS Finco upon the
final payment thereof.

         SECTION 3.3 Application of Collections and Other Funds. If, on any day,
WPS Finco receives (a) Collections that it is not required to hold in trust for,
or remit to, the Servicer or the Administrator pursuant to the Asset Interest
Transfer Agreement or (b) proceeds or transfers pursuant to the Asset Interest
Transfer Agreement, WPS Finco shall apply such funds as follows:

                  (i) first, to pay its existing expenses and to set aside funds
         for the payment of expenses that are then accrued;

                  (ii) second, to pay the Purchase Price pursuant to Section 3.1
         for Receivables and Related Assets purchased by WPS Finco from Seller
         on the Effective Date or in the applicable Reporting Period, as the
         case may be; and

                  (iii) third, in such order as WPS Finco may elect, (A) to
         repay amounts owed by WPS Finco to Seller under the WPS Finco Note, or
         (B) to declare and pay dividends to Seller to the extent permitted by
         law.

         SECTION 3.4 Servicing of Receivables and Related Assets. Consistent
with WPS Finco's ownership, as between the parties to this Purchase Agreement,
of the Receivables and the Related Assets, WPS Finco shall have the sole right
to service, administer and collect the Receivables, to assign such right and to
delegate such right to others. Without limiting the generality of Section 10.11,
Seller hereby acknowledges and agrees that WPS Finco shall assign to the
Administrator (for the benefit of Blue Ridge) the rights and interests granted
by Seller to WPS Finco hereunder and agrees to cooperate fully with the Servicer
and the Administrator in the exercise of such rights. As more fully described in
Section 7.4(b) hereof and in the Asset Interest Transfer Agreement, the
Administrator may only exercise such rights in the place of WPS Finco (as
assignee or otherwise) following the designation of a Servicer other than
WestPoint Stevens pursuant to Section 8.01 of the Asset Interest Transfer
Agreement or upon the occurrence and during the continuance of a Liquidation
Event.


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         SECTION 3.5 Payments and Computations, Etc. All amounts to be paid by
Seller to WPS Finco hereunder shall be paid in accordance with the terms hereof
no later than 2:00 p.m. (New York time) on the day when due in Dollars in
immediately available funds to an account that WPS Finco shall from time to time
specify in writing. Payments received by WPS Finco after such time shall be
deemed to have been received on the next Business Day. In the event that any
payment becomes due on a day which is not a Business Day, then such payment
shall be made on the next succeeding Business Day. Seller shall, to the extent
permitted by law, pay to WPS Finco, on demand, interest on all amounts not paid
when due hereunder at 1.0% per annum above the interest rate on the WPS Finco
Note in effect on the date such payment was due; provided, however, that such
interest rate shall not at any time exceed the maximum rate permitted by
applicable law. All computations of interest payable 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.


                                   ARTICLE IV

                             CONDITIONS TO PURCHASES

         SECTION 4.1 Conditions Precedent to Initial Purchase. The initial
purchase hereunder is subject to the conditions precedent that (i) each of the
conditions precedent to the execution, delivery and effectiveness of each other
Transaction Document (other than a condition precedent in any such other
Transaction Document relating to the effectiveness of this Purchase Agreement)
shall have been fulfilled to the satisfaction of WPS Finco, and (ii) WPS Finco
shall have received (or in the case of subsection (i) below, shall have
delivered) each of the following, on or before the Effective Date, each (unless
otherwise indicated) dated the Effective Date and each in form and substance
satisfactory to WPS Finco:

                  (a) Seller Assignment Certificate. A Seller Assignment
         Certificate in the form of Exhibit 4.1(a) from Seller, duly completed,
         executed and delivered by Seller;

                  (b) Resolutions. A copy of the resolutions of the Board of
         Directors of Seller approving this Purchase Agreement and the other
         Transaction Documents to be delivered by Seller hereunder and the
         transactions contemplated hereby and thereby and addressing such other
         matters as may be required by WPS Finco, certified by its Secretary or
         Assistant Secretary, each as of a recent date acceptable to WPS Finco;


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<PAGE>   16


                  (c) Good Standing Certificate of Seller; Certificates as to
         Foreign Qualification of Seller. A good standing certificate for
         Seller, issued by the Secretary of State of Delaware and of each state
         in which Seller transacts business, is required to be in good standing
         and where the failure to be in good standing could materially and
         adversely affect the condition (financial or otherwise), properties,
         business or results of operations of Seller, each dated as of a recent
         date;

                  (d) Incumbency Certificate. A certificate of the Secretary or
         Assistant Secretary of Seller certifying, as of the date of this
         Purchase Agreement, the names and true signatures of the officers
         authorized on Seller's behalf to sign this Purchase Agreement and the
         other Transaction Documents to be delivered by Seller hereunder;

                  (e) Other Transaction Documents. Original copies, executed by
         each of the parties thereto in such reasonable number as shall be
         specified by WPS Finco, of each of the other Transaction Documents to
         be executed and delivered in connection herewith; and

                  (f) Opinions of Counsel. The following opinions of counsel
         each in form and substance satisfactory to WPS Finco: (i) opinions of
         Weil, Gotshal & Manges LLP, special counsel to Seller as to
         enforceability and UCC validity matters and true sale and
         non-consolidation, and (ii) opinions of Sutherland, Asbill and Brennan,
         as to Georgia tax and UCC perfection and priority matters.

         SECTION 4.2 Certification as to Representations and Warranties. Seller,
by accepting the Purchase Price paid for each purchase of Receivables generated
by Seller and the Related Assets of Seller, shall be deemed to have certified,
with respect to the Receivables and Related Assets to be sold by it on such day,
that its representations and warranties contained in Article V (excluding, with
respect to any day after the Effective Date, Section 5.1(i)) are true and
correct on and as of such day, with the same effect as though made on and as of
such day.

         SECTION 4.3 Effect of Payment of Purchase Price. Upon the payment of
the Purchase Price (whether in cash or by an increase in the WPS Finco Note
pursuant to Section 3.1) for any Purchase, title to the Receivables and the
Related Assets included in such Purchase shall rest in WPS Finco, whether or not
the conditions precedent to such Purchase were in fact satisfied; provided,
however, that WPS Finco shall not be deemed to have waived any claim it may have
under this Purchase Agreement for the failure by Seller in fact to satisfy any
such condition precedent.


                                       12
<PAGE>   17


                                    ARTICLE V

                         REPRESENTATIONS AND WARRANTIES

         SECTION 5.1 Representations and Warranties of Seller. In order to
induce WPS Finco to enter into this Purchase Agreement and to make purchases
hereunder, Seller hereby makes the representations and warranties set forth in
this Section 5.1 at the times and to the extent set forth in Section 4.2.

                  (a) Organization and Good Standing. Seller is a corporation
         duly organized and validly existing in good standing under the laws of
         the State of Delaware and has full power and authority to own its
         properties and to conduct its business as such properties are presently
         owned and such business is presently conducted. Seller had at all
         relevant times, and now has, all necessary power, authority, and legal
         right to own and sell the Receivables and the Related Assets.

                  (b) Due Qualification. Seller is duly qualified to do business
         and is in good standing as a foreign corporation (or is exempt from
         such requirement), and has obtained all necessary licenses and
         approvals, in all jurisdictions in which the ownership or lease of
         property or the conduct of its business requires such qualification,
         licenses or approvals and where the failure so to qualify, to obtain
         such licenses and approvals or to preserve and maintain such
         qualification, licenses or approvals could reasonably be expected to
         have a Material Adverse Effect.

                  (c) Power and Authority; Due Authorization. Seller has (i) all
         necessary corporate power and authority to (A) execute and deliver this
         Purchase Agreement and the other Transaction Documents to which it is a
         party, (B) perform its obligations under this Purchase Agreement and
         the other Transaction Documents to which it is a party, and (C) sell
         and assign Receivables and the Related Assets on the terms and subject
         to the conditions herein and therein provided, (ii) duly authorized by
         all necessary corporate action such sale and assignment and the
         execution, delivery, and performance of this Purchase Agreement and the
         other Transaction Documents to which it is a party and the consummation
         of the transactions provided for in this Purchase Agreement and the
         other Transaction Documents to which it is a party and (iii) duly
         executed and delivered this Purchase Agreement and each other
         Transaction Document to which it is a party.


                                       13
<PAGE>   18

                  (d) Valid Sale; Binding Obligations. Each sale made by Seller
         pursuant to this Purchase Agreement constitutes a valid sale, transfer,
         and assignment of all of Seller's right, title and interest in, to and
         under the Receivables and the Related Assets of Seller to WPS Finco
         which is perfected and of first priority under the UCC and otherwise,
         enforceable against creditors of, and purchasers from, Seller and free
         and clear of any Adverse Claim (other than any Adverse Claim arising
         solely as a result of any action taken by WPS Finco hereunder (or by
         the Administrator on behalf of Blue Ridge under the Asset Interest
         Transfer Agreement); and this Purchase Agreement constitutes, and each
         other Transaction Document to which Seller is a party constitutes, a
         legal, valid and binding obligation of Seller, enforceable against
         Seller in accordance with its terms, except as such enforceability may
         be limited by bankruptcy, insolvency, reorganization or other similar
         laws affecting the enforcement of creditors' rights generally and by
         general principles of equity, regardless of whether such enforceability
         is considered in a proceeding in equity or at law.

                  (e) No Conflict or Violation. The execution, delivery and
         performance of, and the consummation of the transactions contemplated
         by, this Purchase Agreement and the other Transaction Documents to be
         signed by Seller and the fulfillment of the terms hereof and thereof
         will not (i) conflict with, violate, result in any breach of any of the
         terms and provisions of, or constitute (with or without notice or lapse
         of time or both) a default under, (A) the Certificate of Incorporation
         or the Bylaws of Seller or (B) any indenture, loan agreement,
         receivables purchase agreement, mortgage, deed of trust, or other
         material agreement or instrument to which Seller is a party or by which
         it or any of its properties is bound, (ii) result in the creation or
         imposition of any Adverse Claim upon any of the Receivables or Related
         Assets other than pursuant to this Purchase Agreement and the other
         Transaction Documents, or (iii) conflict with or violate any federal,
         state, local or foreign law or any decision, decree, order, rule, or
         regulation applicable to Seller or any of its properties of any court
         or of any federal, state, local or foreign regulatory body,
         administrative agency, or other governmental instrumentality having
         jurisdiction over Seller or any of its properties, which conflict,
         violation, breach or default, individually or in the aggregate, could
         reasonably be expected to have a Material Adverse Effect.

                  (f) Litigation and Other Proceedings. Except as described in
         Schedule 5.1(f) (as Schedule 5.1(f) may be



                                       14
<PAGE>   19


         amended or supplemented from time to time pursuant to Section 6.2(e)),
         (i) there is no action, suit, proceeding or investigation pending or,
         to the best knowledge of Seller, threatened against Seller before any
         court, regulatory body, arbitrator, administrative agency, or other
         tribunal or governmental instrumentality and (ii) Seller is not subject
         to any order, judgment, decree, injunction, stipulation or consent
         order of or with any court or other government authority, that, in the
         case of each of the foregoing clauses (i) and (ii), (A) asserts the
         invalidity of this Purchase Agreement or any other Transaction
         Document, (B) seeks to prevent the sale of any Receivables or Related
         Assets by Seller to WPS Finco, or the consummation of any of the
         transactions contemplated by this Purchase Agreement or any other
         Transaction Document (C) seeks any determination or ruling that would
         materially and adversely affect the performance by Seller of its
         obligations under this Purchase Agreement or any other Transaction
         Document or the validity or enforceability of this Purchase Agreement
         or any other Transaction Document, (D) seeks to affect adversely the
         income tax attributes of the purchases hereunder or the Seller
         Assignment Certificate, in the case of each of the foregoing whether
         under the United States federal income tax system or any state income
         tax system, or (E) individually or in the aggregate for all such
         actions, suits, proceedings and investigations, could reasonably be
         expected to have a Material Adverse Effect.

                  (g) Bulk Sales Act. No transaction contemplated by this
         Purchase Agreement or any other Transaction Document requires
         compliance with, or will be subject to avoidance under, any bulk sales
         act or similar law.

                  (h) Government Approvals. All authorizations, consents, orders
         and approvals of, or other action by, any Governmental Authority that
         are required to be obtained by Seller, and all notices to and filings
         with any Governmental Authority that are required to be made by Seller,
         in the case of each of the foregoing in connection with the conveyance
         of Receivables and Related Assets or the due execution, delivery and
         performance by Seller of this Purchase Agreement or any other
         Transaction Document to which it is a party, and the consummation of
         the transactions contemplated by this Purchase Agreement, have been
         obtained or made and are in full force and effect, except where the
         failure to obtain or to make any such authorization, consent, order,
         approval, notice or filing, individually or in the aggregate for all
         such failures, could not reasonably be expected to have a Material
         Adverse Effect.


                                       15
<PAGE>   20

                  (i) Financial Condition. WestPoint Stevens Inc. hereby
         represents that its consolidated balance sheets as at December 31,
         1997, and the related statements of income and shareholders' equity of
         WestPoint Stevens Inc. and its Consolidated Subsidiaries for the fiscal
         year then ended certified by, Ernst & Young, LLP, independent certified
         public accountants, copies of which have been furnished to WPS Finco,
         fairly present the consolidated financial condition and business of
         WestPoint Stevens Inc. and its Consolidated Subsidiaries as at such
         date and the consolidated results of the operations of WestPoint
         Stevens and its Consolidated Subsidiaries for the period ended on such
         date, all in accordance with GAAP consistently applied throughout the
         periods reflected therein, and since December 31, 1997 through the date
         of this Purchase Agreement there has been no material adverse change in
         the condition (financial or otherwise), business or operations of
         Seller;

                  (j) Margin Regulations. No funds obtained by Seller under this
         Purchase Agreement will be used (i) for a purpose that violates or will
         conflict with or contravene any of Regulations T, U and X promulgated
         by the Board of Governors of the Federal Reserve System from time to
         time or (ii) to acquire any security in any transaction that is subject
         to Section 13 or 14 of the Securities Exchange Act of 1934, as amended.

                  (k) Quality of Title.

                           (i) Immediately before each purchase to be made by
                  WPS Finco hereunder, each Receivable and Related Asset of
                  Seller which is then to be transferred to WPS Finco hereunder
                  or thereunder, and the related Contracts, shall be owned by
                  Seller free and clear of any Adverse Claim (other than any
                  Adverse Claim arising solely as the result of any action taken
                  by WPS Finco hereunder or by the Administrator on behalf of
                  Blue Ridge under the Asset Interest Transfer Agreement); and
                  Seller shall have made all filings and shall have taken all
                  other action under applicable law in each relevant
                  jurisdiction in order to protect and perfect the ownership
                  interest of WPS Finco and its successors in such Receivables
                  and Related Assets against all creditors of, and purchasers
                  from, Seller.

                           (ii) Whenever WPS Finco makes a purchase hereunder,
                  it shall have acquired and shall at all times thereafter
                  continuously maintain a valid and perfected first priority
                  ownership interest in each Transferred Asset, free and clear
                  of any Adverse Claim



                                       16
<PAGE>   21


                  (other than any Adverse Claim arising solely as the result of
                  any action taken by WPS Finco hereunder or by the
                  Administrator on behalf of Blue Ridge under the Asset Interest
                  Transfer Agreement).

                           (iii) No currently effective financing statement or
                  other instrument similar in effect that covers all or part of
                  any Receivable, any interest therein or any Related Asset with
                  respect thereto is on file in any recording office except such
                  as may be filed (A) in favor of Seller in accordance with the
                  Contracts, (B) in favor of WPS Finco pursuant to this Purchase
                  Agreement and, (C) in favor of the Administrative Agent for
                  the benefit of Blue Ridge, in accordance with the Asset
                  Interest Transfer Agreement.

                           (iv) No purchase of an interest in any Receivable or
                  Related Asset of Seller by WPS Finco from Seller constitutes a
                  fraudulent transfer or fraudulent conveyance under the United
                  States Bankruptcy Code or applicable state bankruptcy or
                  insolvency laws or is otherwise void or voidable or subject to
                  subordination under similar laws or principles or for any
                  other reason.

                           (v) The purchase of Receivables and Related Assets by
                  WPS Finco from Seller constitutes a true and valid sale of
                  such Receivables and Related Assets under applicable state law
                  and true and valid assignments and transfers for consideration
                  (and not merely a pledge of such Receivables and Related
                  Assets for security purposes), enforceable against the
                  creditors of Seller, and no Receivables or Related Assets
                  transferred to WPS Finco hereunder shall constitute property
                  of Seller.

                  (l) Eligible Receivables. On the date of each Monthly Report
         which identifies a Receivable as an Eligible Receivable, such
         Receivable is an Eligible Receivable.

                  (m) Accuracy of Information. All written information furnished
         prior to, on and after the Effective Date by Seller or any other WPS
         Person to WPS Finco, the Servicer or the Administrative Agent pursuant
         to or in connection with any Transaction Document or any transaction
         contemplated herein or therein shall not contain any untrue statement
         of a material fact or omit to state material facts necessary to make
         the statements made not misleading, in each case on the date such
         statement was made and in light of the circumstances under which such
         statements were made or such information was furnished.


                                       17
<PAGE>   22

                  (n) Offices. The principal place of business and chief
         executive office of Seller is located at the address set forth under
         Seller's signature hereto, and the offices where Seller keeps all
         Records and all Contracts, purchase orders and agreements related to
         the Receivables and the Related Assets (and all original documents
         relating thereto) are located at the addresses specified in Schedule
         5.1(n) (or at such other locations, notified to the Servicer and the
         Administrative Agent in accordance with Section 6.1(f), in
         jurisdictions where all action required pursuant to Section 7.3 has
         been taken and completed).

                  (o) Lock-Box Banks and Payment Instructions. The names and
         addresses of all Lock-Box Banks and the Concentration Bank, together
         with the account numbers of the Lock-Box Accounts and the Concentration
         Account at such Lock-Box Banks or Concentration Bank (as applicable)
         are accurately identified on Schedule 5.1(o) hereto and will be
         specified in such notices as shall have been delivered thereafter
         pursuant to Section 6.3(c). Each lock-box identified on Schedule 5.1(o)
         is subject to a Lock-Box/Collection Account Agreement that is in full
         force and effect and exclusive dominion and control of each such
         lock-box has been transferred to WPS Finco. Seller has not granted any
         Person, other than WPS Finco as contemplated by this Purchase
         Agreement, any currently effective right of dominion and control of any
         such lock-box or Lock-Box Account or the Concentration Account, or the
         right to take dominion and control of any such lock-box or Lock-Box
         Account or the Concentration Account at a future time or upon the
         occurrence of a future event. Seller has instructed all Obligors to
         submit all payments on the Receivables and Related Assets directly to
         one of the LockBox Accounts. Seller has and maintains accounting,
         administrative and operating procedures that permit identification of
         the Collections.

                  (p) Compliance with Applicable Laws. Seller is in compliance
         in all respects with the requirements of all applicable laws, rules,
         regulations, and orders of all Governmental Authorities (federal,
         state, local or foreign, and including environmental laws), a violation
         of any of which, individually or in the aggregate for all such
         violations, could reasonably be expected to have a Material Adverse
         Effect.

                  (q) Legal Names. During the past five years (i) Seller has not
         been known by or used any legal name other than its corporate name as
         of the date hereof, and (ii) Seller has not been the subject of any
         merger or other



                                       18
<PAGE>   23


         corporate reorganization that resulted in a change of name, identity or
         corporate structure. Seller uses no trade names or assumed names other
         than its actual corporate name and the trade names and assumed names
         set forth in Schedule 5.1(q).

                  (r) Investment Company Act. Seller is not, and is not
         controlled by, an "investment company" registered or required to be
         registered under the Investment Company Act of 1940, as amended.

                  (s) Taxes. Seller has filed or caused to be filed all material
         tax returns and reports required by law to have been filed by it and
         has paid all taxes, assessments and governmental charges thereby shown
         to be owing, except any such taxes, assessments or charges (i) which
         are being diligently contested in good faith by appropriate
         proceedings, (ii) for which adequate reserves in accordance with GAAP
         shall have been set aside on its books and (iii) with respect to which
         no Lien has been imposed upon any Receivables or Related Assets.

                  (t) Year 2000 Compliance. Seller has conducted a review and
         assessment of its and its Subsidiaries' computer applications and made
         inquiry of its key suppliers, vendors and customers with respect to the
         Year 2000 Problem and, based on that review and inquiry, Seller
         reasonably believes that the Year 2000 Problem will not result in a
         Material Adverse Effect.

                  (u) Compliance with Credit and Collection Policy. With respect
         to each Receivable, the Seller has complied in all material respects
         with the Credit and Collection Policy.

                  (v) Payments to Seller. With respect to each Receivable
         transferred to WPS Finco by Seller pursuant to this Purchase Agreement,
         Seller represents that the Purchase Price paid to it constitutes
         reasonably equivalent value in consideration for the Receivables
         originated by it and the Related Assets with respect thereto and such
         transfer was not made for or on account of antecedent debt.

                  (w) Ownership of WPS Finco. Seller owns, directly or
         indirectly, 100% of the issued and outstanding capital stock of WPS
         Finco, free and clear of any Adverse Claim. Such capital stock is
         validly issued, fully paid and nonassessable, and there are no options,
         warrants or other rights to acquire securities of WPS Finco.


                                       19
<PAGE>   24

                  (x) Material Agreements. The Agreements listed on Schedule A
         to the opinion of Weil, Gotshal & Manges LLP of even date herewith are
         all of the agreements relating to the financing of the Seller.

                  (y) Pay-Off of Previous Securitization. WestPoint Stevens
         Inc., in its capacity as servicer under the Amended and Restated
         Pooling and Servicing Agreement, dated as of December 10, 1993 and
         amended and restated as of May 27, 1994, by and among WPS Finco,
         WestPoint Stevens, Inc., as servicer, and The Chase Manhattan Bank, as
         successor in interest to Chemical Bank, as trustee, has computed the
         amounts necessary to satisfy in full all obligations due thereunder and
         under the related transaction documents in order to provide for the
         termination of such agreement and the trust created thereby (including,
         without limitation, all fees, expenses and prepayment premiums) and
         such computation is true and correct.

         SECTION 5.2 Representations and Warranties of WPS Finco. From the date
hereof until the Purchase Termination Date, WPS Finco hereby represents and
warrants that (a) (i) this Purchase Agreement has been duly executed and
delivered by WPS Finco and (ii) constitutes WPS Finco's valid, binding and
legally enforceable obligation, except as enforceability may be limited
by bankruptcy, insolvency, reorganization, or other similar laws affecting the
enforcement of creditors' rights generally and by general principles of equity,
regardless of whether such enforceability is considered in a proceeding in
equity or at law, and (b) the execution, delivery and performance of this
Purchase Agreement does not violate any applicable law or any agreement to which
WPS Finco is a party or by which its properties are bound.


                                   ARTICLE VI

                           GENERAL COVENANTS OF SELLER

         SECTION 6.1 Affirmative Covenants. From the Effective Date until the
first day following the Purchase Termination Date on which all Obligations of
Seller shall have been finally and fully paid and performed and the Transferee's
Total Investment shall have been reduced to zero, unless WPS Finco shall
otherwise give its prior written consent, Seller hereby agrees that it will
perform the covenants and agreements set forth in this Section 6.1.

                  (a) Compliance with Laws, Etc. Seller will comply with all
         applicable laws, rules, regulations, judgments, decrees and orders
         (including those relating to the



                                       20
<PAGE>   25


         Receivables, the Related Assets, the related Contracts and any other
         agreements related thereto), where the failure so to comply,
         individually or in the aggregate for all such failures, could
         reasonably be expected to have a Material Adverse Effect.

                  (b) Preservation of Corporate Existence. Seller will preserve
         and maintain its corporate existence, rights, franchises and privileges
         in the jurisdiction of its incorporation, and qualify and remain
         qualified in good standing as a foreign corporation in each
         jurisdiction where the failure to preserve and maintain such existence,
         rights, franchises, privileges and qualifications could reasonably be
         expected to have a Material Adverse Effect.

                  (c) Receivables Reviews. Seller shall, during regular business
         hours upon not less than five Business Days' prior notice (unless a
         Liquidation Event has occurred and is continuing (or the Administrator,
         on Blue Ridge's behalf, reasonably believes in good faith that a
         Liquidation Event has occurred and is continuing), in which case one
         Business Day notice shall be required), permit WPS Finco or the
         Administrator and their respective agents or representatives, (i) to
         examine and make copies of and abstracts from, and to conduct
         accounting reviews of, all Records in the possession or under the
         control of Seller relating to the Receivables or Related Assets
         generated by Seller, and (ii) to visit the offices and properties of
         Seller for the purpose of examining such materials described in clause
         (i) next above, and to discuss matters relating to any Receivables or
         any Related Assets of Seller or Seller's performance hereunder with any
         of the Authorized Officers of Seller or, with the prior consent of an
         Authorized Officer of Seller, with employees of Seller having knowledge
         of such matters (the examinations set forth in the foregoing clauses
         (i) and (ii) being herein called a "Seller Receivables Review"). WPS or
         the Administrator Finco and its agents or representatives shall be
         entitled to conduct Seller Receivables Reviews whenever WPS Finco, in
         its reasonable judgment, deems a Seller Receivables Review appropriate.
         The costs and expenses of one such Seller Receivables Review in any one
         calendar year shall be paid by Seller, and the costs and expenses of
         any additional Seller Receivables Review during such calendar year
         shall be paid by WPS Finco unless a Liquidation Event shall have
         occurred and be continuing.

                  (d) Keeping of Records and Books of Account. Seller shall
         maintain and implement administrative and operating procedures
         (including, an ability to recreate records



                                       21
<PAGE>   26


         evidencing its Receivables and Related Assets in the event of the
         destruction of the originals thereof), and shall keep and maintain, all
         documents, books, records and other information which, in the
         reasonable determination of WPS Finco and the Administrator, are
         necessary or advisable in accordance with prudent industry practice and
         custom for transactions of this type for the collection of all
         Receivables and the Related Assets. Upon the request of WPS Finco or
         the Administrator made at any time after the occurrence and continuance
         of a Servicer Transfer Event, Seller will deliver copies of all books
         and records maintained pursuant to this Section 6.1(d) to the
         Administrator. Seller shall maintain at all times accurate and complete
         books, records and accounts relating to the Receivables, Related Assets
         and Contracts and all Collections thereon in which timely entries shall
         be made. Such books and records shall be marked to indicate the sales
         of all Receivables and Related Assets hereunder and shall include (i)
         all payments received and all credits and extensions granted with
         respect to such Receivables and (ii) the return, rejection,
         repossession, or stoppage in transit of any merchandise, the sale of
         which has given rise to a Receivable that has been purchased by WPS
         Finco.

                  (e) Performance and Compliance with Receivables and Contracts.
         Seller will, at its expense, timely and fully perform and comply with
         all provisions, covenants and other promises required to be observed by
         it under the Contracts and all other agreements of Seller related to
         the Receivables and Related Assets, the breach of which provisions,
         covenants or promises could be reasonably expected to have a Material
         Adverse Effect.

                  (f) Location of Records and Offices. Seller will keep its
         principal place of business and chief executive office, and the offices
         where it keeps all Records related to the Receivables and the Related
         Assets (and all original documents relating thereto), at the addresses
         referred to in Schedule 5.1(n) or, upon not less than 30 days' prior
         written notice given by Seller to WPS Finco, and the Administrator, at
         such other locations in jurisdictions where all action required by
         Section 7.3 shall have been taken and completed.

                  (g) Credit and Collection Policies. Seller will comply in all
         material respects with its Credit and Collection Policy in regard to
         each Receivable of Seller and the Related Assets and the Contracts
         related to each such Receivable, where the failure so to comply,
         individually or



                                       22
<PAGE>   27


         in the aggregate for all such failures, could reasonably be expected to
         have a Material Adverse Effect.

                  (h) Separate Corporate Existence of WPS Finco. Seller hereby
         acknowledges that the Administrator, on behalf of Blue Ridge, is
         entering into the transactions contemplated by the Asset Interest
         Transfer Agreement in reliance upon WPS Finco's identity as a legal
         entity separate from Seller and the other WPS Persons. Therefore, from
         and after the date hereof until the first day following the Purchase
         Termination Date on which all Obligations of Seller shall have been
         fully paid and performed and the Transferee's Total Investment shall
         have been reduced to zero, Seller will, and will cause each other WPS
         Person to, take all reasonable steps to continue their respective
         identities as separate legal entities and to make it apparent to third
         Persons that each is an entity with assets and liabilities distinct
         from those of WPS Finco and that WPS Finco is not a division of the
         Servicer, Seller or any other Person.

                  (i) Payment Instructions to Obligors. Seller will instruct all
         Obligors to submit all payments on all Receivables and Related Assets
         purchased by WPS Finco either (i) directly to one of the Lock-Box
         Accounts or (ii) directly to the Concentration Account. Seller will
         cause (i) all proceeds deposited directly to any Lock-Box Account to be
         transferred daily to the Concentration Account, and (ii) each such
         lock-box and Lock-Box Account and the Concentration Account to be
         subject at all times to a Lock- Box/Collection Account Agreement that
         is in full force and effect. Seller shall not grant any Person, other
         than WPS Finco or the Administrator, dominion and control of any such
         lock-box or Lock-Box Account or the Concentration Account, or the right
         to take dominion or control of any lock-box or Lock-Box Account or the
         Concentration Account at a future time or upon the occurrence of a
         future event. Seller shall maintain accounting, administrative and
         operating procedures that permit identification of the Collections.

                  (j) Taxes. Seller will file all tax returns and reports
         required by law to be filed by it, will accrue in accordance with GAAP
         for all taxes payable by it and will pay all taxes and governmental
         charges shown on such tax returns and reports to be owing by it, prior
         to the date on which penalties attach thereto except any such taxes or
         charges which (i) are being diligently contested in good faith by
         appropriate proceedings, (ii) for which adequate reserves in accordance
         with GAAP have been set aside on their respective books and (iii) with
         respect to which no



                                       23
<PAGE>   28


         Lien has been imposed upon any Receivables or Related Assets.

                  (k) Reserved

                  (l) Identification of Eligible Receivables. Seller will
         establish and maintain such procedures as are necessary for determining
         monthly whether each Receivable qualifies as an Eligible Receivable as
         of the date of Purchase and thereafter as of each Reporting Date, and
         for identifying all Receivables sold or to be sold in that month which
         are not Eligible Receivables.

                  (m) Accuracy of Information. All written information furnished
         on and after the Effective Date by Seller or any other WPS Person to
         WPS Finco, the Servicer or the Administrator pursuant to or in
         connection with any Transaction Document or any transaction
         contemplated herein or therein shall not contain any untrue statement
         of a material fact or omit to state material facts necessary to make
         the statements made not misleading, in each case on the date such
         statement was made and in light of the circumstances under which such
         statements were made or such information was furnished.

                  (n) Year 2000 Compliance. Seller will use its best efforts to
         meet the milestones contained in its Year 2000 Plan and will use its
         best efforts to have all of its and its Subsidiaries hardware and
         software systems Year 2000 Compliant and Ready (including all internal
         and external testing) on or before June 30, 1999.

                  (o) Ownership Interest of WPS Finco. Seller shall take all
         necessary action to establish and maintain, in favor of WPS Finco or
         its assigns, a valid and perfected first priority undivided percentage
         ownership interest in all Receivables and the Related Assets to the
         full extent contemplated herein, free and clear of any Adverse Claims
         other than Adverse Claims in favor of WPS Finco or its assigns
         (including, without limitation, the filing of all financing statements
         or other similar instruments or documents necessary under the UCC of
         all appropriate jurisdictions (or any comparable law) to perfect WPS
         Finco's or its assign's interest in such Receivables and Related Assets
         and such other action to perfect, protect or more fully evidence the
         interest of WPS Finco or its assigns as WPS Finco or its assigns may
         reasonably request).

         SECTION 6.2 Reporting Requirements. From the Effective Date until the
first day following the Purchase Termination Date



                                       24
<PAGE>   29


on which all Obligations of Seller shall have been finally and fully paid and
performed and the Transferee's Total Investment shall have been reduced to zero,
Seller agrees that it will, unless WPS Finco and the Administrator, on behalf of
Blue Ridge, shall otherwise give prior written consent, furnish to WPS Finco and
the Administrator:

                  (a) Quarterly Financial Statements. Within 50 days after the
         end of each of the first three fiscal quarters of each fiscal year of
         WestPoint Stevens, copies of the unaudited consolidated balance sheets
         of WestPoint Stevens and its Consolidated Subsidiaries as at the end of
         such fiscal quarter and the related unaudited statements of earnings
         and cash flows and stockholders' equity, in each case for such fiscal
         quarter and for the period from the beginning of such fiscal year
         through the end of such fiscal quarter, prepared in accordance with
         GAAP consistently applied throughout the periods reflected therein and
         certified (subject to year end adjustments) by the chief financial
         officer or chief accounting officer of WestPoint Stevens;

                  (b) Annual Financial Statements. As soon as possible and in
         any event within 95 days after the end of each fiscal year of WestPoint
         Stevens, a copy of the consolidated balance sheet of WestPoint Stevens
         and its Consolidated Subsidiaries as at the end of such fiscal year and
         the related statements of earnings, stockholders' equity and cash flows
         of WestPoint Stevens and its Consolidated Subsidiaries for such fiscal
         year, setting forth in each case in comparative form the corresponding
         figures for the preceding fiscal year and prepared in accordance with
         GAAP consistently applied throughout the periods reflected therein,
         accompanied by an opinion of Ernst & Young, LLP, (or such other
         independent certified public accountants of a nationally recognized
         standing in the United States of America as shall be selected by
         Administrator), which opinion shall not be qualified in any material
         respect;

                  (c) Liquidation Events. As soon as possible, and in any event
         within three Business Days after an Authorized Officer of Seller has
         obtained knowledge of the occurrence of any Liquidation Event or any
         Unmatured Liquidation Event, a written statement of an Authorized
         Officer of Seller describing such event and the action that Seller
         proposes to take with respect thereto, in each case in reasonable
         detail;

                  (d) Material Adverse Effect. As soon as possible and in any
         event within three Business Days after an Authorized Officer of Seller
         has knowledge thereof, written notice that describes in reasonable
         detail any event or occurrence which, individually or in the aggregate
         for all such events or occurrences, has had, or that could reasonably
         be expected to have a Material Adverse Effect;

                  (e) Proceedings. As soon as possible and in any event within
         five Business Days after an Authorized



                                       25
<PAGE>   30


         Officer of Seller has knowledge thereof, written notice of (i) any
         litigation, investigation or proceeding of the type described in
         Section 5.1(f) not previously disclosed to WPS Finco and (ii) any
         judgment, settlement or other final disposition with respect to any
         such previously disclosed litigation, investigation or proceeding;

                  (f) Reserved

                  (g) Year 2000 Notices. Seller will deliver to WPS Finco:

                           i. Simultaneously with the delivery of each set of
                           annual and quarterly financial statements referred to
                           in subsections (a) and (b) above, a statement of the
                           chief executive officer, chief financial officer,
                           controller, treasurer, assistant treasurer or chief
                           technology officer to the effect that nothing has
                           come to their attention to cause them to believe that
                           Seller's Year 2000 Plan milestones have not been met
                           in a manner such that Seller's and its Subsidiaries'
                           hardware and software systems will not be Year 2000
                           Compliant and Ready in accordance with its Year 2000
                           Plan; and

                           ii. Within five (5) Business Days after Seller
                           becomes aware of any deviations from its Year 2000
                           Plan which would cause compliance with such Year 2000
                           Plan to be delayed or not achieved, a statement of
                           the chief executive officer, chief financial officer,
                           controller, treasurer, assistant treasurer or chief
                           technology officer setting forth the details thereof
                           and the action which Seller is taking or proposes to
                           take with respect thereto.

                  (h) Reports to Holders and Exchanges. In addition to the
         reports required by subsections (a), and (b) above, promptly upon WPS
         Finco's request, Seller will furnish to WPS Finco copies of any reports
         specified in such request which Seller sends to any of its
         securityholders, and any


                                       26
<PAGE>   31


         reports or registration statements that Seller files with the
         Securities and Exchange Commission or any national securities exchange
         other than registration statements relating to employee benefit plans
         and to registrations of securities for selling securities,

                  (i) ERISA. Promptly after the filing or receiving thereof,
         Seller will furnish to WPS Finco copies of all reports and notices with
         respect to any Reportable Event defined in Article IV of ERISA which
         Seller or any of its Subsidiaries files under ERISA with the Internal
         Revenue Service, the Pension Benefit Guaranty Corporation or the U.S.
         Department of Labor or which Seller or any of its Subsidiaries receives
         from the Pension Benefit Guaranty Corporation,

                  (j) Review of Pool Receivables. As soon as available and in
         any event by the end of each fiscal year of Seller, Seller will furnish
         to WPS Finco a report, prepared by a Person reasonably acceptable to
         WPS Finco as of the end of such fiscal year, substantially in the form
         of the report delivered pursuant to Section 5.01(l) of the Asset
         Interest Transfer Agreement and covering such other matters as WPS
         Finco may reasonably request in order to protect the interests of WPS
         Finco under or as contemplated by this Purchase Agreement; provided
         that Seller shall not be required to furnish a report pursuant to this
         Section 6.2(i) for its fiscal year ending December 31, 1999 unless the
         Scheduled Maturity Date shall have been extended during such year
         pursuant to Section 1.06 of the Asset Interest Transfer Agreement;

                  (k) Change in Business or Credit and Collection Policy. At
         least ten (10) Business Days prior to its effective date, Seller will
         furnish to WPS Finco notice of (i) any material change in the character
         of Seller's business, and (ii) any material change in the Credit and
         Collection Policy;

                  (l) Ratings. Within one Business Day of obtaining knowledge
         thereof, Seller will furnish to WPS Finco notice of any downgrading or
         withdrawal of any rating of Seller's senior secured debt by any rating
         agency; and

                  (m) Other. Promptly, from time to time, (i) such other
         information, documents, records or reports respecting the Receivables
         or the Related Assets or (ii) such other publicly available information
         respecting the condition or operations, financial or otherwise, of
         Seller, in each case as WPS Finco may from time to time reasonably
         request in



                                       27
<PAGE>   32


         order to protect the interests of WPS Finco, the Administrative Agent
         or Blue Ridge under or as contemplated by this Purchase Agreement.

         SECTION 6.3 Negative Covenants. From the Effective Date until the first
day following the Purchase Termination Date on which all Obligations of Seller
shall have been finally and fully paid and performed and the Transferee's Total
Investment shall have been reduced to zero, unless WPS Finco and the
Administrator shall otherwise give their prior written consent (which consent
shall not be unreasonably withheld or delayed), Seller hereby agrees that it
will perform the covenants and agreements set forth in this Section 6.3.

                  (a) Sales, Liens, Etc. Except as otherwise provided herein or
         in the Asset Interest Transfer Agreement, Seller will not (i) (A) sell,
         assign (by operation of law or otherwise) or otherwise transfer to any
         Person, (B) pledge any interest in, (C) grant, create, incur, assume or
         permit to exist any Adverse Claim to or in favor of any Person upon or
         with respect to, or (D) cause to be filed any financing statement or
         equivalent document relating to perfection that covers, any Transferred
         Asset or any Contract related to any Receivable, or upon or with
         respect to any Lock-Box Account or Concentration Account or any
         interest therein, (ii) assign to any Person any right to receive income
         from or in respect of any of the foregoing or (iii) assert any interest
         in any Transferred Receivable or any Contract relating to any
         Receivable, except as Servicer.

                  In the event that Seller fails to keep any Transferred Assets
         free and clear of any Adverse Claim (other than Adverse Claims arising
         hereunder or under the Asset Interest Transfer Agreement, and other
         Adverse Claims permitted by any other Transaction Document), WPS Finco
         may (without limiting its other rights with respect to Seller's breach
         of its obligations hereunder) make reasonable expenditures necessary to
         release such Adverse Claim. WPS Finco shall be entitled to
         indemnification for any such expenditures pursuant to the
         indemnification provisions of Article IX. Alternatively, WPS Finco may
         deduct such expenditures as an offset to the Purchase Price owed to
         Seller hereunder.

                  (b) Extension or Amendment of Receivables; Change in Credit
         and Collection Policy or Contracts. Seller will not extend, amend or
         otherwise modify the terms of any Receivable or Contract in a manner
         that materially adversely affects the collectibility of any Receivable
         or WPS Finco's or the Administrator's rights therein (except in its
         capacity as Servicer and then only to the extent permitted


                                       28
<PAGE>   33


         under Section 8.02(c) of the Asset Interest Transfer Agreement) or (ii)
         make or permit to be made any change in the character of its business
         or in the Credit and Collection Policy that would, in either case,
         impair the collectibility of any significant portion of the Receivables
         or otherwise adversely affect the interests or remedies of WPS Finco's
         or the Administrator's rights therein unless with respect to any
         material change in accounting policies relating to Receivables, such
         change is made in accordance with GAAP.

                  (c) Change in Payment Instructions to Obligors. Seller will
         not (i) add or terminate any bank as a Lock-Box Bank from those listed
         on Schedule 5.1(o) unless, prior to any such addition, termination or
         change WPS Finco and the Administrator shall have received not less
         than ten Business Days' prior written notice of such addition or
         termination and, not less than ten Business Days prior to the effective
         date of any such proposed addition, change or termination, WPS Finco
         and the Administrator shall have received (A) counterparts of the
         applicable type of Lock-Box/Collection Account Agreement with each new
         Lock-Box Bank, duly executed by such new Lock-Box Bank and all other
         parties thereto and (B) copies of all other agreements and documents
         signed by such Lock-Box Bank and such other parties with respect to any
         new Lock-Box Account, all of which agreements and documents shall be
         reasonably satisfactory in form and substance to WPS Finco and the
         Administrator, or (ii) make any change in its instructions to Obligors,
         given in accordance with Section 5.1(o), regarding payments to be made
         to Seller or payments to be made to any Lock-Box Bank or the
         Concentration Account, other than changes in such instructions which
         direct Obligors to make payments to another Lock-Box Account or
         Concentration Account (as applicable) at such Lock-Box or Concentration
         Bank.

                  (d) Mergers, Consolidations, Sales, etc. Except for mergers or
         consolidations permitted by the Credit Agreement, Seller will not be a
         party to any merger or consolidation or, except as permitted by the
         Credit Agreement, purchase, lease or otherwise acquire (in one
         transaction or in a series of transactions) all or substantially all of
         the assets of any other Person (whether directly by purchase, lease or
         acquisition of all or substantially all of the assets of such Person or
         indirectly by purchase or other acquisition of all or substantially all
         of the capital stock of such other Person). Seller will give WPS Finco
         and the Administrator notice of any such permitted merger or
         consolidation promptly following completion thereof. Seller will not,
         directly or indirectly, transfer, assign, convey



                                       29
<PAGE>   34


         or lease, whether in one transaction or in a series of transactions,
         all or substantially all of its assets except as permitted by the
         Credit Agreement, or sell or assign, with or without recourse, any
         Receivables or Related Assets, in each case other than pursuant to this
         Purchase Agreement.

                  (e) Change in Name. Seller will not (i) change its corporate
         name, any trade name or corporate structure or (ii) change the name
         under or by which it does business in any manner which would or may
         make any financing statement filed by Seller in accordance herewith
         seriously misleading within the meaning of Section 9-402(7) of an
         applicable enactment of the UCC, in each case unless Seller shall have
         given WPS Finco, the Servicer and the Administrator 30 days' prior
         written notice thereof and unless, prior to any such change in name,
         Seller shall have taken and completed all action required by Section
         7.3.

                  (f) Certificate of Incorporation. Seller will not cause WPS
         Finco to amend its Certificate of Incorporation or Bylaws without the
         prior written consent of WPS Finco and the Administrator, which consent
         will not be unreasonably withheld or delayed.

                  (g) Amendments to Transaction Documents. Seller will not amend
         or otherwise modify or supplement any Transaction Document to which it
         is a party unless WPS Finco and the Administrator shall have given its
         prior written consent to each such amendment, modification or
         supplement, which consent shall not be unreasonably withheld or
         delayed.

                  (h) Accounting for Purchases. Seller shall prepare its
         financial statements in accordance with GAAP. Seller shall not prepare
         any financial statements which account for the transactions
         contemplated in this Purchase Agreement in any manner other than as a
         sale of the Purchased Assets by Seller to WPS Finco, or in any other
         respect account for or treat the transactions contemplated in this
         Purchase Agreement (including but not limited to accounting and, where
         taxes are not consolidated, for tax reporting purposes) in any manner
         other than as a sale of the Transferred Assets by Seller to WPS Finco.

                  (i) Receivables Not to be Evidenced by Promissory Notes.
         Seller shall not take any action to cause or permit any Receivable to
         become evidenced by any "instrument" (as defined in the applicable
         UCC), except in connection with the collection of any such Receivable
         which is overdue provided that the original of such instrument is
         delivered to WPS Finco, duly endorsed.


                                       30
<PAGE>   35


                  (j) Deposits to Lock-Box Accounts and Concentration account.
         Seller shall not deposit or otherwise credit, or cause or permit to be
         so deposited or credited, to any LockBox Account or Concentration
         Account, any cash or cash proceeds other than Collections of
         Receivables. To the extent that any such funds nevertheless are
         deposited into any of such Lock-box Accounts or Concentration Account,
         the Seller shall promptly identify any such funds, or shall cause such
         funds to be so identified, to WPS Finco, the Servicer and the
         Administrator (following which notice, WPS Finco shall cause the
         Servicer to return all such funds to the Seller).


                                   ARTICLE VII

                      ADDITIONAL RIGHTS AND OBLIGATIONS IN
                        RESPECT OF THE TRANSFERRED ASSETS

         SECTION 7.1 Rights of WPS Finco.

         (a) Subject to Section 7.4(b), Seller hereby authorizes WPS Finco, the
Servicer and/or their respective designees to take any and all steps in Seller's
name and on behalf of Seller that WPS Finco, the Servicer and/or their
respective designees determine are reasonably necessary or appropriate to
collect all amounts due under any and all Transferred Assets, including
endorsing the name of Seller on checks and other instruments representing
Collections and enforcing such Receivables and Related Assets.

         (b) Except as set forth in Section 3.1(c) with respect to Noncomplying
Receivables and Dilution Adjustments to the Purchase Price, WPS Finco shall have
no obligation to account for, to replace, to substitute or to return any
Transferred Asset to Seller. WPS Finco shall have no obligation to account for,
or to return Collections, or any interest or other finance charge collected
pursuant thereto, to Seller, irrespective of whether such Collections and
charges are in excess of the Purchase Price for such Purchased Assets.

         (c) WPS Finco shall have the unrestricted right to further assign,
transfer, deliver, hypothecate, subdivide or otherwise deal with the Transferred
Assets, and all of WPS Finco's right, title and interest in, to and under this
Purchase Agreement, on whatever terms WPS Finco shall determine, pursuant to the
Asset Interest Transfer Agreement or otherwise.

         (d) WPS Finco shall have the sole right to retain any gains or profits
created by buying, selling or holding the Transferred


                                       31
<PAGE>   36


Assets and shall have the sole risk of and responsibility for losses or damages
created by such buying, selling or holding.

         SECTION 7.2 Responsibilities of Seller. Anything herein to the contrary
notwithstanding:

                  (a) Seller agrees to deliver directly to the Servicer (for WPS
         Finco's account), within one Business Day after receipt thereof, any
         Collections that it receives, in the form so received, and agrees that
         all such Collections shall be deemed to be received in trust for WPS
         Finco and shall be maintained and segregated separate and apart from
         all other funds and moneys of Seller until delivery of such Collections
         to the Servicer.

                  (b) Seller shall perform all of its obligations hereunder and
         under the Contracts related to the Receivables and Related Assets to
         the same extent as if such Receivables had not been sold hereunder, and
         the exercise by WPS Finco or its designee or assignee of WPS Finco's
         rights hereunder or in connection herewith shall not relieve Seller
         from any of its obligations under the Contracts or Related Assets
         related to the Receivables.

                  (c) Seller hereby grants to WPS Finco an irrevocable power of
         attorney, with full power of substitution, coupled with an interest, to
         take in the name of Seller all steps necessary or advisable to endorse,
         negotiate or otherwise realize on any writing or other right of any
         kind held or transmitted by Seller or transmitted or received by WPS
         Finco (whether or not from Seller) in connection with any Transferred
         Asset.

                  (d) To the extent that Seller does not own the computer
         software that Seller uses to account for Receivables, Seller shall use
         reasonable efforts to provide WPS Finco and the Administrator with such
         licenses, sublicenses and/or assignments of contracts as WPS Finco or
         the Administrator shall require with regard to all services and
         computer hardware or software used by Seller that relate to the
         servicing of the Receivables or the Related Assets.

         SECTION 7.3 Further Action Evidencing Purchases. Seller agrees that
from time to time, at its expense, it will promptly, upon reasonable request,
execute and deliver all further instruments and documents, and take all further
action, in order to perfect, protect or more fully evidence the purchase by WPS
Finco of the Receivables and the Related Assets under this Purchase Agreement,
or to enable WPS Finco to exercise or enforce any of its rights hereunder or
under any other Transaction


                                       32
<PAGE>   37


Document. Seller further agrees that from time to time, at its expense, it will
promptly, upon request, take all action that WPS Finco, the Servicer or the
Administrator may reasonably request in order to perfect, protect or more fully
evidence such purchase of the Receivables and the Related Assets or to enable
WPS Finco or the Administrator, on Blue Ridge's behalf (as the assignee of WPS
Finco), to exercise or enforce any of its rights hereunder or under any other
Transaction Document. Without limiting the generality of the foregoing, upon the
request of WPS Finco, Seller will:

                  (a) execute and file such financing or continuation
         statements, or amendments thereto or assignments thereof, and such
         other instruments or notices, as WPS Finco or the Administrator may
         reasonably determine to be necessary or appropriate; and

                  (b) place on its computer systems and records which store
         information relating to and evidencing the Receivables the following
         legend:

                  "THE RECEIVABLES DESCRIBED HEREIN HAVE BEEN SOLD TO WPS
                  RECEIVABLES CORPORATION PURSUANT TO A RECEIVABLES PURCHASE
                  AGREEMENT, DATED AS OF DECEMBER 18, 1998, BETWEEN WESTPOINT
                  STEVENS INC. AND WPS RECEIVABLES CORPORATION; AND SUCH
                  RECEIVABLES HAVE BEEN TRANSFERRED TO WACHOVIA BANK, N.A., AS
                  ADMINISTRATOR ON BEHALF OF BLUE RIDGE ASSET FUNDING
                  CORPORATION PURSUANT TO AN ASSET INTEREST TRANSFER AGREEMENT,
                  DATED AS OF DECEMBER 18, 1998, AMONG WPS RECEIVABLES
                  CORPORATION, AS TRANSFEROR, WESTPOINT STEVENS INC., AS INITIAL
                  SERVICER, BLUE RIDGE ASSET FUNDING CORPORATION, AS TRANSFEREE
                  AND WACHOVIA BANK, N.A., AS ADMINISTRATOR."

         Seller hereby authorizes WPS Finco or its designee to file one or more
financing or continuation statements, and amendments thereto and assignments
thereof, relative to all or any of the Receivables and Related Assets of Seller,
in each case whether now existing or hereafter generated by Seller. Except for
material performance obligations of Seller to any Obligor hereunder or under any
of the Contracts, if (i) Seller fails to perform any of its agreements or
obligations under this Purchase Agreement and does not remedy such failure
within the applicable cure period, if any, and (ii) WPS Finco in good faith
reasonably believes that the performance of such agreements and obligations is
necessary or appropriate to protect the interests of WPS Finco under this
Purchase Agreement, then WPS Finco or its designee may (but shall not be
required to) perform, or cause performance of,



                                       33
<PAGE>   38


such agreement or obligation and the reasonable expenses of WPS Finco or its
designee or assignee incurred in connection with such performance shall be
payable by Seller as provided in Section 9.1.

         SECTION 7.4 Collection of Receivables; Rights of WPS Finco and Its
Assignees.

         (a) Seller hereby transfers to WPS Finco ownership of, and the
exclusive dominion and control over, each of the Lock-Box Accounts owned by
Seller, and Seller hereby agrees to take any further action that WPS Finco or
the Administrator (as assignee of WPS Finco) may reasonably request in order to
effect or complete such transfer.

         (b) WPS Finco may, at any time, direct the Obligors of Receivables, or
any of them, to pay all amounts payable under any Transferred Asset directly to
the Administrator or its designees. Furthermore, Seller shall, at the request of
WPS Finco and at Seller's expense, promptly give notice of Blue Ridge's interest
in the Receivables of such Obligor and the Related Assets to each such Obligor
and direct that payments be made directly to the Administrator or its designee,
which notice shall be acceptable in form and substance to WPS Finco. In
addition, Seller hereby authorizes WPS Finco to take any and all steps in
Seller's name and on behalf of Seller that are necessary or desirable, in the
reasonable determination of WPS Finco, to collect all amounts due under any and
all Transferred Assets, including endorsing Seller's name on checks and other
instruments representing Collections and enforcing the Receivables, Related
Assets and the Contracts related to such Receivables. The Administrator, on Blue
Ridge's behalf, may exercise any of the foregoing rights in the place of WPS
Finco (as assignee or otherwise) at any time following the designation of a
Servicer other than WestPoint Stevens pursuant to Section 8.01 of the Asset
Interest Transfer Agreement or the occurrence and continuance of a Liquidation
Event.

         (c) At any time when (i) a Liquidation Event shall have occurred and
remain continuing or (ii) a Servicer other than WestPoint Stevens has been
designated pursuant to Section 8.01 of the Asset Interest Transfer Agreement,
Seller shall, at WPS Finco's request, assemble all of the Records which evidence
the Receivables and Related Assets originated by Seller and the Contracts
related to such Receivables, or which are otherwise necessary or desirable to
collect such Receivables or Related Assets, and make the same available to WPS
Finco or the Administrator at a place selected by the Administrator or its
designee.



                                       34
<PAGE>   39


                                  ARTICLE VIII

                                   TERMINATION

         SECTION 8.1 Termination by Seller. Prior to the Termination Date,
Seller may terminate its agreement to sell Receivables hereunder to WPS Finco by
giving WPS Finco and the Administrator not less than thirty Business Days' prior
written notice of Seller's election not to continue to sell Receivables to WPS
Finco. Upon receipt of a termination notice from Seller, WPS Finco shall notify
the Administrator and Blue Ridge that it is electing to reduce the Transferee's
Total Investment to zero pursuant to Section 3.02 of the Asset Interest Transfer
Agreement as early as is practicable. The sale of Receivables under this
Purchase Agreement will not cease until the Transferee's Total Investment shall
have been reduced to zero.

         SECTION 8.2 Automatic Termination. The agreement of Seller to sell
Receivables hereunder, and the agreement of WPS Finco to purchase Receivables
from Seller hereunder, shall terminate automatically as a result of a bankruptcy
proceeding being filed by or against Seller or WPS Finco.


                                   ARTICLE IX

                                 INDEMNIFICATION

         SECTION 9.1 Indemnities by Seller. Without limiting any other rights
which any RPA Indemnified Party (as defined below) may have hereunder or under
applicable law, Seller severally agrees to indemnify WPS Finco, each of its
successors, permitted transferees and assigns, and all officers, directors,
shareholders, controlling Persons, employees and agents of any of the foregoing
(each of the foregoing Persons being individually called a "RPA Indemnified
Party"), forthwith on demand, from and against any and all damages, losses,
claims (whether on account of settlements or otherwise), judgments, liabilities
and related reasonable costs and expenses (including reasonable attorneys' fees
and disbursements) awarded against or incurred by any of them arising out of or
as a result of any of the following (all of the foregoing being collectively
called "RPA Indemnified Losses"):

                  (a) any representation or warranty made in writing by Seller
         (or any of its Authorized Officers) under or in connection with any of
         the Transaction Documents, any Monthly Report or any other information
         or report delivered by Seller or the Servicer (for so long as the
         Servicer is a WPS Person) shall have been false, incorrect or
         materially



                                       35
<PAGE>   40


         misleading when made or deemed made or omitted to state material facts
         necessary to make the statements made not misleading;

                  (b) the failure by Seller to comply with any applicable law,
         rule or regulation with respect to any Receivable or any Related Asset
         or to comply with any Contract related thereto, or the nonconformity of
         any Receivable, the related Contract or any Related Assets with any
         such applicable law, rule or regulation;

                  (c) the failure to vest and maintain vested in WPS Finco and
         its assigns a first priority perfected ownership interest in the
         Receivables, the Related Assets, the related Collections and the
         proceeds of each of the foregoing, free and clear of any Adverse Claim
         (other than an Adverse Claim created in favor of WPS Finco pursuant to
         this Purchase Agreement or in favor of the Administrator on behalf of
         Blue Ridge pursuant to the Asset Interest Transfer Agreement), whether
         existing at the time of the sale of such Receivable or at any time
         thereafter;

                  (d) any failure of Seller to perform its duties or obligations
         in accordance with the provisions of the Transaction Documents;

                  (e) any products liability claim, personal injury or property
         damage suit, environmental liability claim or any other claim or action
         by a party other than WPS Finco or a WPS Person of whatever sort,
         whether sounding in tort, contract or any other legal theory, arising
         out of or in connection with the goods or services that are the subject
         of any Receivable or the Related Assets with respect thereto or
         Collections thereof;

                  (f) the failure to file, or any delay in filing, financing
         statements or other similar instruments or documents under the UCC of
         any applicable jurisdiction or other applicable laws with respect to
         any Receivables or the Related Assets or Collections, whether at the
         time of any sale or at any subsequent time;

                  (g) any dispute, claim, offset or defense (other than the
         discharge in bankruptcy) of an Obligor to the payment of any Receivable
         or Related Asset, or Related Asset, including a defense based on such
         Receivable's or the related Contract's not being a legal, valid and
         binding obligation of such Obligor enforceable against it in accordance
         with its terms or any other claim resulting from the sale of the
         merchandise or services related to such Receivable or the



                                       36
<PAGE>   41


         furnishing or failure to furnish such merchandise or services;

                  (h) any tax or governmental fee or charge (other than
         franchise taxes and taxes on or measured by the net income of WPS Finco
         or any of its assignees), all interest and penalties thereon or with
         respect thereto, and all reasonable out-of-pocket costs and expenses,
         including the reasonable fees and expenses of counsel in defending
         against the same, which may arise by reason of the purchase or
         ownership of the Receivables or any Related Asset connected with any
         such Receivables or in any goods which secure any such Receivable or
         Related Asset;

                  (i) any transfer by Seller of any interest in any Receivable
         other than the transfer of Receivables and related property by the
         Seller to WPS Finco pursuant to this Purchase Agreement; and

                  (j)      any claim of breach by any Seller of any related
         Contract with respect to any Receivable.

Notwithstanding the foregoing (and with respect to clause (ii) below, without
prejudice to the rights that WPS Finco may have pursuant to the other provisions
of this Purchase Agreement or the provisions of any of the other Transaction
Documents), in no event shall any RPA Indemnified Party be indemnified for any
RPA Indemnified Losses (i) resulting from gross negligence or willful misconduct
on the part of such RPA Indemnified Party, (ii) to the extent the same includes
losses in respect of Receivables and reimbursement therefor that would
constitute credit recourse to Seller for the amount of any Receivable or Related
Asset not paid by the related Obligor, (iii) resulting from the action or
omission of the Servicer (unless the Servicer is a WPS Person), (iv) to the
extent that the same are or result from lost profits (except to the extent any
such lost profits are incurred under Sections 4.02 or 4.03 of the Asset Interest
Transfer Agreement), (v) to the extent the same are or result from taxes on or
measured by the net income of such RPA Indemnified Party and (vi) to the extent
the same constitute consequential, special or punitive damages (except to the
extent any such consequential, special or punitive damages are actually imposed
on an RPA Indemnified Party as a result of a claim brought by a third party).

         Section 9.2. Contribution. If for any reason the indemnification
provided in Section 9.1 is unavailable to a RPA Indemnified Party or is
insufficient to hold a RPA Indemnified Party harmless, then Seller shall
contribute to the maximum



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<PAGE>   42


amount payable or paid to such RPA Indemnified Party as a result of such loss,
claim, damage or liability in such proportion as is appropriate to reflect not
only the relative benefits received by such RPA Indemnified Party on the one
hand and Seller on the other hand, but also the relative fault of such RPA
Indemnified Party (if any) and Seller and any other relevant equitable
considerations.


                                    ARTICLE X

                                  MISCELLANEOUS

         SECTION 10.1  Amendments; Waivers, Etc.

         (a) The provisions of this Purchase Agreement may from time to time be
amended, modified or waived, if such amendment, modification or waiver is in
writing and signed by WPS Finco and Seller (with respect to an amendment) or by
WPS Finco (with respect to a waiver or consent by it) and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given. This Purchase Agreement shall not be amended unless WPS
Finco shall have delivered the proposed amendment to the Administrative Agent at
least ten Business Days (or such shorter period as shall be acceptable to the
Administrative Agent) prior to the execution and delivery thereof.

         (b) No failure or delay on the part of WPS Finco, any RPA Indemnified
Party, or the Administrative Agent or any other third party beneficiary referred
to in Section 10.12(a) in exercising any power or right hereunder shall operate
as a waiver thereof, nor shall any single or partial exercise of any such power
or right preclude any other or further exercise thereof or the exercise of any
other power or right. No notice to or demand on Seller in any case shall entitle
it to any notice or demand in similar or other circumstances. No waiver or
approval by WPS Finco or the Administrative Agent under this Purchase Agreement
shall, except as may otherwise be stated in such waiver or approval, be
applicable to subsequent transactions. No waiver or approval under this Purchase
Agreement shall require any similar or dissimilar waiver or approval thereafter
to be granted hereunder.

         SECTION 10.2 Notices, Etc. All notices and other communications
provided for hereunder shall, unless otherwise stated herein, be in writing
(including facsimile communication) and shall be personally delivered or sent by
express mail or courier or by certified mail, postage prepaid, or by facsimile,
to the intended party at the address or facsimile number of such


                                       38
<PAGE>   43


party set forth under its name on the signature pages hereof or at such other
address or facsimile number as shall be designated by such party in a written
notice to the other parties hereto given in accordance with this Section 10.2.
Copies of all notices and other communications provided for hereunder shall be
delivered to the Administrative Agent at its address for notices set forth in
the Asset Interest Transfer Agreement. All notices and communications provided
for hereunder shall be effective, (a) if personally delivered, or sent by
express mail or courier or if sent by certified mail, when received, and (b) if
transmitted by facsimile, when sent, receipt confirmed by telephone or
electronic means.

         SECTION 10.3 Cumulative Remedies. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law. Without limiting
the foregoing, Seller hereby authorizes WPS Finco, at any time and from time to
time, to the fullest extent permitted by law, to set-off, against any
Obligations of WPS Finco to Seller that are then due and payable or that are not
then due and payable by WPS Finco to Seller but have then accrued, any and all
indebtedness or other obligations (i) at any time owing to WPS Finco by Seller
or (ii) that are not then due and payable from WPS Finco to Seller but have then
accrued.

         SECTION 10.4 Binding Effect; Assignability; Survival of Provisions.
This Purchase Agreement shall be binding upon and inure to the benefit of WPS
Finco, Seller and their respective successors and permitted assigns. Seller may
not assign any of its rights hereunder or any interest herein without the prior
written consent of WPS Finco and of the Administrator (on Blue Ridge's behalf).
This Purchase Agreement shall create and constitute the continuing obligations
of the parties hereto in accordance with its terms, and shall remain in full
force and effect until the earlier of (i) the first date following the Purchase
Termination Date, (ii) the date on which the Transferee's Total Investment shall
have been reduced to zero pursuant to Section 3.02 of the Asset Interest
Transfer Agreement, and all Obligations of Seller hereunder shall have been
finally and fully paid and performed and (iii) such other later time as the
parties hereto shall agree. The rights and remedies with respect to any breach
of any representation and warranty made by Seller pursuant to Article V and the
indemnification and payment provisions of Article IX and Section 10.6 shall be
continuing and shall survive any termination of this Purchase Agreement.

         SECTION 10.5 Governing Law. THIS PURCHASE AGREEMENT SHALL BE GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO CONFLICT OF LAWS



                                       39
<PAGE>   44


PRINCIPLES, EXCEPT TO THE EXTENT THAT THE PERFECTION OF THE INTERESTS OF WPS
FINCO IN THE RECEIVABLES AND THE RELATED ASSETS ARE GOVERNED BY THE LAWS OF A
JURISDICTION OTHER THAN THE STATE OF NEW YORK.

         SECTION 10.6 Costs, Expenses and Taxes. In addition to the obligations
of Seller under Article IX, Seller, severally with respect to itself, agrees to
pay on demand:

                  (a) all reasonable out-of-pocket and other costs and expenses
         in connection with the enforcement of this Purchase Agreement, the
         Seller Assignment Certificate or the other Transaction Documents by WPS
         Finco or any successor in interest to WPS Finco; and

                  (b) all stamp and other taxes and fees payable or determined
         to be payable in connection with the execution and delivery by Seller,
         and the filing and recording, of this Purchase Agreement or the other
         Transaction Documents, and agrees to indemnify each RPA Indemnified
         Party against any liabilities with respect to or resulting from any
         delay in paying or the omission to pay such taxes and fees.

         SECTION 10.7  Consent to Jurisdiction; Waiver of Immunities.
EACH PARTY HERETO HEREBY ACKNOWLEDGES AND AGREES THAT:

                  (A) IT IRREVOCABLY (I) SUBMITS TO THE JURISDICTION, FIRST, OR
ANY UNITED STATES FEDERAL COURT, AND SECOND, IF FEDERAL JURISDICTION IS NOT
AVAILABLE, OF ANY GEORGIA STATE COURT, IN EITHER CASE, SITTING IN FULTON COUNTY,
GEORGIA, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS PURCHASE
AGREEMENT OR ANY OTHER TRANSACTION DOCUMENT, (II) AGREES THAT ALL CLAIMS IN
RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED ONLY IN SUCH
GEORGIA STATE OR FEDERAL COURT AND NOT IN ANY OTHER COURT, (III) WAIVES, TO THE
FULLEST EXTENT IT MAY EFFECTIVELY DO SO, THE DEFENSE OF AN INCONVENIENT FORUM TO
THE MAINTENANCE OF SUCH ACTION OR PROCEEDING, (IV) CONSENTS TO THE SERVICE OF
ANY AND ALL PROCESS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES OF
SUCH PROCESS TO SUCH PERSON AT ITS ADDRESS SPECIFIED FOR NOTICES HEREUNDER, AND
(V) TO THE EXTENT ALLOWED BY LAW, AGREES THAT A FINAL JUDGMENT IN ANY SUCH
ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER
JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.

                  (B) TO THE EXTENT THAT IT HAS OR HEREAFTER MAY ACQUIRE ANY
IMMUNITY FROM THE JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER
THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID TO
EXECUTION, EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, IT
HEREBY WAIVES SUCH



                                       40
<PAGE>   45


IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER OR IN CONNECTION WITH THIS PURCHASE
AGREEMENT.

         SECTION 10.8 Waiver of Jury Trial. EACH PARTY HERETO EXPRESSLY WAIVES
ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND
ANY RIGHTS UNDER OR RELATING TO THIS PURCHASE AGREEMENT, ANY OTHER TRANSACTION
DOCUMENT, OR ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH
MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR THEREWITH OR ARISING
FROM ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR
WRITTEN), ACTIONS OF EITHER OF THE PARTIES HERETO OR ANY OTHER RELATIONSHIP
EXISTING IN CONNECTION WITH THIS PURCHASE AGREEMENT OR ANY OTHER TRANSACTION
DOCUMENT, AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A
COURT AND NOT BEFORE A JURY.

         SECTION 10.9 Integration. This Purchase Agreement and the other
Transaction Documents contain a final and complete integration of all prior
expressions by the parties hereto with respect to the subject matter hereof and
thereof and shall together constitute the entire agreement between the parties
hereto with respect to the subject matter hereof and thereof, superseding all
prior oral or written understandings.

         SECTION 10.10 Execution in Counterparts. This Purchase 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.

         SECTION 10.11 Acknowledgment and Consent.

         (a) Seller acknowledges that, contemporaneously herewith, WPS Finco is
selling, transferring, assigning, setting over and otherwise conveying to the
Administrator on behalf of Blue Ridge an Asset Interest in the outstanding pool
of Receivables and Related Assets sold by Seller to WPS Finco from time to time
pursuant to this Purchase Agreement. Seller hereby consents to the sale,
transfer, assignment, set over and conveyance to the Administrator on behalf of
Blue Ridge by WPS Finco of the Asset Interest, and all of WPS Finco's rights,
remedies, powers and privileges, and all claims of WPS Finco against Seller,
under or with respect to this Purchase Agreement and the other Transaction
Documents (whether arising pursuant to the terms of this Purchase Agreement or
otherwise available at law or in equity), including (i) the right of WPS Finco,
at any time, to enforce this Purchase Agreement against Seller and the
obligations of Seller hereunder, and (ii) the right, at any time, to give or
withhold any and all consents, requests, notices, directions, approvals,
demands,


                                       41
<PAGE>   46


extensions or waivers under or with respect to this Purchase Agreement, any
other Transaction Document or the obligations in respect of Seller thereunder to
the same extent as WPS Finco may do. Each of the parties hereto acknowledges and
agrees that the Administrator (on behalf of Blue Ridge) and Blue Ridge are third
party beneficiaries of the rights of WPS Finco arising hereunder and under the
other Transaction Documents to which Seller is a party. Seller hereby
acknowledges and agrees that it has no claim to or interest in any of the
Lock-Box Accounts or the Concentration Account.

         (b) Seller hereby agrees to execute all agreements, instruments and
documents, and to take all other action, that WPS Finco or the Administrator
reasonably determines is necessary or appropriate to evidence its consent
described in paragraph (a) above. To the extent that WPS Finco, individually or
through the Servicer, has granted or grants powers of attorney to the
Administrator under the Asset Interest Transfer Agreement, Seller hereby grants
a corresponding power of attorney on the same terms to WPS Finco. Seller hereby
acknowledges and agrees that WPS Finco, in all of its capacities, shall assign
to the Administrator for the benefit of Blue Ridge such powers of attorney and
other rights and interests granted by Seller to WPS Finco hereunder and agrees
to cooperate fully with the Administrator in the exercise of such rights.

         SECTION 10.12 No Partnership or Joint Venture. Nothing contained in
this Purchase Agreement shall be deemed or construed by the parties hereto or by
any third person to create the relationship of principal and agent or of
partnership or of joint venture.

         SECTION 10.13 No Proceedings. Seller hereby agrees that it will not
institute against WPS Finco or Blue Ridge, or join any other Person in
instituting against WPS Finco or Blue Ridge, any insolvency or bankruptcy
proceeding (namely, any proceeding of the type referred to in the definition of
"Event of Bankruptcy") so long as Commercial Paper Notes shall be outstanding or
there shall not have elapsed one year plus one day since the last day on which
any such Commercial Paper Notes shall have been outstanding. The foregoing shall
not limit the right of Seller to file any claim in or otherwise take any action
with respect to any insolvency proceeding that was instituted against WPS Finco
or Blue Ridge by any Person other than Seller or any other WPS Person.

         SECTION 10.14 Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Purchase Agreement or any of
the other Transaction Documents shall for any reason whatsoever be held invalid,
then such



                                       42
<PAGE>   47


covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Purchase Agreement
or such other Transaction Document (as applicable) and shall in no way affect
the validity or enforceability of the other provisions of this Purchase
Agreement or any of the other Transaction Documents.

         SECTION 10.15 Recourse to WPS Finco. Except to the extent expressly
provided otherwise in the Transaction Documents, the obligations of WPS Finco
under the Transaction Documents to which it is a party are solely the
obligations of WPS Finco, and no recourse shall be had for payment of any fee
payable by or other obligation of or claim against WPS Finco that arises out of
any Transaction Document to which WPS Finco is a party against any director,
officer or employee of WPS Finco. The provisions of this Section 10.15 shall
survive the termination of this Purchase Agreement.

                            (SIGNATURE PAGE FOLLOWS)



                                       43
<PAGE>   48


         IN WITNESS WHEREOF, the parties have caused this Receivables Purchase
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.

                                    WESTPOINT STEVENS INC.


                                    By:  /s/  Nelson Griffith
                                       -----------------------------------------
                                    Name:  J. Nelson Griffith
                                    Title:  Controller
                                    Address:  507 West 10th Street
                                              Post Office Box 71
                                              West Point, GA  31833

                                    Attention:  J. Nelson Griffith
                                    Telephone:  (706) 645-4213
                                    Facsimile:  (706) 645-4066



                                    WPS RECEIVABLES CORPORATION


                                    By:  /s/  Nelson Griffith
                                       -----------------------------------------
                                    Name:  J. Nelson Griffith
                                    Title:  Vice President/Assistant Treasurer
                                    Address:  507 West 10th Street
                                              Post Office Box 71
                                              West Point, GA  31833

                                    Attention:  J. Nelson Griffith
                                    Telephone:  (706) 645-4213
                                    Facsimile:  (706) 645-4066