[Letterhead of CIT Group]

                                                            9/17, 1998

LEVCOR INTERNATIONAL, INC.
1071 Avenue of the Americas
New York, NY 10018

                               FACTORING AGREEMENT

Ladies and Gentlemen:

      We are pleased to confirm the terms and conditions that will govern our
funds in use accounting, notification factoring arrangement with advances (the
"Agreement").

      1. SALE OF ACCOUNTS

      You sell and assign to us, and we purchase as absolute owner, all accounts
receivable arising from your sales of inventory or rendition of services,
including those under any trade names, through any divisions and through any
selling agent (collectively, the "Accounts" and individually, an "Account").

      2. CREDIT APPROVAL

      2.1 Requests for credit approval for all of your orders must be submitted
to our Credit Department via computer by either: (a) On-Line Terminal Access, or
(b) Electronic Batch Transmission. If you are unable to submit orders via
computer, then orders can be submitted over the phone, by fax or in writing. All
credit decisions by our Credit Department (including approvals, declines and
holds) will be sent to you daily by a Credit Decisions Report, which constitutes
the official record of our credit decisions. Credit approvals will be effective
only if shipment is made or services are rendered within thirty (30) days from
the completion date specified in our credit approval. Credit approval of any
Account may be withdrawn by us any time before delivery is made or services are
rendered.
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      2.2 We assume the Credit Risk on each Account approved in the Credit
Decision Report. "Credit Risk" means the customer's failure to pay the Account
in full when due on its longest maturity solely because of its financial
inability to pay. If there is any change in the amount, terms, shipping date or
delivery date for any shipment of goods or rendition of services (other than
accepting returns and granting allowances as provided in section 8 below), you
must submit a change of terms request to us, and, if such pertains to a Factor
Risk Account, then we shall advise you of our decision either to retain the
Credit Risk or to withdraw the credit approval. Accounts on which we bear the
Credit Risk are referred to collectively as "Factor Risk Accounts", and
individually as a "Factor Risk Account". Accounts on which you bear some or all
of the risk as to credit are referred to collectively as "Client Risk Accounts",
and individually as a "Client Risk Account".

      2.3 We shall have no liability to you or to any person, firm or entity for
declining, withholding or withdrawing credit approval on any order. If we
decline to credit approve an order and furnish to you any information regarding
the credit standing of that customer, such information is confidential and you
agree not to reveal same to the customer, your sales agent or any third party.
You agree that we have no obligation to perform, in any respect, any contracts
relating to any Accounts.

      3. INVOICING

      You agree to place a notice (in form and content acceptable to us) on each
invoice and invoice equivalent that the Account is sold, assigned and payable
only to us, and to take all necessary steps so that payments and remittance
information are directed to us. All invoices, or their equivalents, will be
promptly mailed or otherwise transmitted by you to your customers at your
expense. You will provide us with copies of all invoices (or the equivalent
thereof if the invoices were sent electronically), confirmation of the sale of
the Accounts to us and proof of shipment or delivery, all as we may reasonably
request. If you fail to provide us with copies of such invoices (or equivalents)
or such proofs when requested by us, we will not bear any Credit Risk as to
those Accounts.

      4. REPRESENTATIONS AND WARRANTIES

      4.1 You represent and warrant that: each Account is based upon a bona fide
sale and delivery of inventory or rendition of services made by you in the
ordinary course of business; the inventory being sold and the Accounts created
are your exclusive property and are not, and will not be, subject to any lien,
consignment arrangement, encumbrance or security interest other than in our
favor; all amounts are due in United States Dollars; all original invoices bear
notice of the sale and assignment to us; any taxes or fees relating to your
Accounts or inventory are solely your responsibility; and none of the Accounts
factored with us hereunder represent sales to any subsidiary, affiliate or
parent company. You also warrant and represent that: your customers have
accepted the goods or services and owe and are obligated to pay the full amounts
stated in the invoices according to their
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                                        3


terms, without dispute, claim, offset, defense, deduction, rejection,
recoupment, counterclaim or contra account, other than as to returns and
allowances as provided in section 8 below (the foregoing being referred to in
this Agreement as "Customer Claims").

      4.2 You further represent and warrant that: you are a duly organized and
validly existing business organization qualified to do business in all states
where required; the most recent financial statements provided by you to us
accurately reflect your financial condition as of that date and there has been
no material adverse change in your financial condition since the date of those
financial statements. You agree to furnish us with such information concerning
your business affairs and financial condition as we may reasonably request from
time to time. You will furnish to us as soon as possible, but not later than one
hundred twenty (120) days after the close of each of your fiscal years, your
financial statements as of the end of such year, audited by a firm of
independent, certified public accountants, selected by you and acceptable to us.

      4.3 You agree that you will promptly notify us of any change in your:
name, location of your chief executive office, place(s) of business, use of
trade names and divisions, and legal or business structure. Further, you agree
that you will promptly notify us of any change in control of the ownership of
your business organization, and of significant law suits or proceedings against
you.

      5. PURCHASE OF ACCOUNTS

      We shall purchase the Accounts for the gross amount of the respective
invoices, less: factoring fees or charges, trade and cash discounts allowable
to, or taken by, your customers, credits, cash on account and allowances
("Purchase Price"). Our purchase of the Accounts will be reflected on the
Statement of Account (defined in section 10 below), which we shall render to
you, which will also reflect all credits and discounts made available to your
customers.

      6. ADVANCES

      At your request, and in our sole discretion, we may advance funds to you
on Factor Risk Accounts, prior to the collection of the Accounts. We have the
right, at any time and from time to time, to hold any reserves we deem
reasonably necessary as security for the payment and performance of any and all
of your Obligations (defined in section 12 below). All amounts you owe us,
including all advances to you and any debit balance in your Client Position
Account (defined in section 10 below), and any Obligations, are payable on
demand and may be charged to your account at any time.
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      7. PAYMENT OF ACCOUNTS

      7.1 All payments received by us on the Accounts will be promptly applied
to your account with us after crediting your customer's account. In exchange for
such application, we shall charge your account monthly with the cost of three
(3) additional business days on all such payments at the rate charged by us in
section 14.1 below on debit balances. No checks, drafts or other instruments
received by us will constitute final payment of an Account unless and until such
items have actually been collected.

      7.2 The amount of the Purchase Price of any Factor Risk Account which
remains unpaid will be deemed collected and will be credited to your account as
of the earlier of the following dates:

      (a)   the date of the Account's longest maturity if a proceeding or
            petition is filed by or against the customer under any state or
            federal bankruptcy or insolvency law, or if a receiver or trustee is
            appointed for the customer; or

      (b)   the last day of the third month following the Account's longest
            maturity date if such Account remains unpaid as of said date without
            the occurrence of any of the events specified in clause (a) above.

If any Factor Risk Account credited to you was not paid for any reason other
than Credit Risk, we shall reverse the credit and charge your account
accordingly, and such Account is then deemed to be a Client Risk Account.

      8. CUSTOMER CLAIMS AND CHARGE BACKS

      8.1 You must notify us promptly of any matter affecting the value,
enforceability or collectibility of any Account and of all Customer Claims. You
agree to promptly issue credit memoranda or otherwise adjust the customer's
account upon accepting returns or granting allowances. For full invoice credit
memoranda, you agree to send duplicate copies thereof to us and to confirm their
assignment to us. You may continue to do so until we have advised you that all
such credits or allowances on Factor Risk Accounts require our prior written
approval. We shall cooperate with you in the adjustment of Customer Claims, but
we retain the right to adjust Customer Claims on Factor Risk Accounts directly
with customers, upon such terms as we in our sole discretion may deem advisable.

      8.2 We may at any time charge back to your account the amount of: (a) any
Factor Risk Account which is not paid in full when due for any reason other than
Credit Risk; (b) any Factor Risk Account which is not paid in full when due
because of an act of God, civil
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                                        5


strife, or war; (c) anticipation (interest) deducted by a customer on any
Account; (d) Customer Claims; (e) any Client Risk Account which is not paid in
full when due; and (f) any Account for which there is a breach of any
representation or warranty. A charge back does not constitute a reassignment of
an Account.

      8.3 We may at any time charge to your account the amount of: (a) payments
we receive on Client Risk Accounts which we are required at any time to turnover
or return (including preference claims); (b) all remittance expenses (including
incoming wire charges, currency conversion fees and stop payment fees), other
than stop payment fees on Factor Risk Accounts; (c) expenses, collection agency
fees and attorneys' fees incurred by us in collecting or attempting to collect
any Client Risk Account or any Obligation (defined in section 12 below); and (d)
our fees for handling collections on Client Risk Accounts which you have
requested us to process, as provided in the Guide (see section 18.2 below).

      9. HANDLING AND COLLECTING ACCOUNTS; RETURNED GOODS

      9.1 As owners of the Factor Risk Accounts, we have the right to: (a) bring
suit, or otherwise enforce collection, in your name or ours; (b) modify the
terms of payment, (c) settle, compromise or release, in whole or in part, any
amounts owing, and (d) issue credits in your name or ours. To the extent
applicable, you waive any and all claims and defenses based on suretyship. If
moneys are due and owing from a customer for both Factor Risk Accounts and
Client Risk Accounts, you agree that any payments or recoveries received on such
Accounts may be applied first to any Factor Risk Accounts. Once you have granted
or issued a discount, credit or allowance on any Account, you have no further
interest therein. Any checks, cash, notes or other documents or instruments,
proceeds or property received with respect to the Accounts must be held by you
in trust for us, separate from your own property, and immediately turned over to
us with proper endorsements. We may endorse your name or ours on any such check,
draft, instrument or document.

      9.2 As owners and assignees of the Accounts and all proceeds thereof, upon
our written notice, you will, at your expense, set aside, mark with our name and
hold in trust for us, any and all returned, rejected, reclaimed or repossessed
inventory ("Returned Goods"). Further, upon such notice, you agree promptly: to
notify us of all Returned Goods and, at our request, either to deliver same to
us, or to pay us the invoice price thereof, or to sell the same for our account.
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      10. STATEMENT OF ACCOUNT

      After the end of each month, we shall send you certain reports reflecting
Accounts purchased, advances made, fees and charges and all other financial
transactions between us during that month ("Reports"). The Reports sent to you
each month include a Statement of Account reflecting transactions in three
sections: Accounts Receivable, Client Position Account and Funds In Use. The
Reports shall be deemed correct and binding upon you and shall constitute an
account stated between us unless we receive your written statement of exceptions
within thirty (30) days after same are mailed to you.

      11. GRANT OF SECURITY INTEREST

      11.1 You hereby assign and grant to us a continuing security interest in
all of your right, title and interest in and to all of your now existing and
future: (a) accounts receivable (including Accounts), instruments, documents,
chattel paper, general intangibles, and any other obligations owing to you; (b)
unpaid seller's rights (including rescission, repossession, replevin,
reclamation and stoppage in transit); (c) rights to any inventory represented by
the foregoing, including Returned Goods; (d) reserves and credit balances
arising hereunder; (e) guarantees or collateral for the foregoing (including
rights under any letters of credit or other credit enhancements in your favor);
(f) insurance policies, proceeds or rights relating to the foregoing; (g)
federal, state and local income tax refunds; (h) cash and non-cash proceeds of
the foregoing; and (i) Books and Records (defined in section 13 below)
evidencing or pertaining to the foregoing.

      11.2 You agree to comply with all applicable laws to perfect our security
interest in collateral pledged to us hereunder, and to execute financing
statements and other documents as we may require to effectuate the foregoing and
to implement this Agreement. To the extent permitted by applicable law, you
authorize us to sign your name, or to file financing statements or continuations
without your signature, all in order to create, perfect or maintain our security
interest in the collateral.

      12. OBLIGATIONS SECURED

      The security interest granted hereunder and any lien or security interest
that we now or hereafter have in any of your other assets, collateral or
property, secure the payment and performance of all of your now existing and
future indebtedness and obligations to us, whether absolute or contingent,
whether arising under this Agreement or any other agreement or arrangement
between us, by operation of law or otherwise ("Obligations"). Obligations also
includes ledger debt (which means indebtedness for goods and services
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                                        7


purchased by you from any party whose accounts receivable are factored or
financed by us), and indebtedness arising under any guaranty, credit enhancement
or other credit support granted by you in our favor. Any reserves or balances to
your credit and any other assets, collateral or property of yours in our
possession constitutes security for any and all Obligations.

      13. BOOKS AND RECORDS AND EXAMINATIONS

      13.1 You agree to maintain such Books and Records concerning the Accounts
as we may reasonably request and to reflect our ownership of the Accounts
therein. "Books and Records" means your accounting and financial records
(whether paper, computer or electronic), data, tapes, discs, or other media, and
all programs, files, records and procedure manuals relating thereto, wherever
located.

      13.2 Upon our reasonable request, you agree to make your Books and Records
available to us for examination and to permit us to make copies or extracts
thereof. Also, you agree to permit us to visit your premises during your
business hours and to conduct such examinations as we deem reasonably necessary.
To cover our costs and expenses of any such examinations, we shall charge you a
fee for each day, or part thereof, during which such examination is conducted,
plus any out-of-pocket costs and expenses incurred by us, as provided in the
Guide (see section 18.2 below).

      14. INTEREST

      14.1 Interest is charged as of the last day of each month based on the
daily debit balances in your Funds In Use account for that month, at a rate
equal to the sum of one-half of one percent (0.5%) plus the Chase Prime Rate
(defined below). The Chase Prime Rate is the per annum rate of interest publicly
announced by The Chase Manhattan Bank (or its successor) in New York, New York
from time to time as its prime rate, and is not intended to be the lowest rate
of interest charged by The Chase Manhattan Bank to its borrowers. Any change in
the rate of interest hereunder due to a change in the Chase Prime Rate will take
effect as of the first of the month following such change in the Chase Prime
Rate. All interest is calculated on a 360 day year.

      14.2 In no event will interest charged hereunder exceed the highest lawful
rate. In the event, however, that we do receive interest in excess of the
highest lawful rate, you agree that your sole remedy would be to seek repayment
of such excess, and you irrevocably waive any and all other rights and remedies
which may be available to you under law or in equity.
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      15. FACTORING FEES AND OTHER CHARGES

      15.1 For our services hereunder, you will pay us a factoring fee or charge
of six-tenths of one percent (0.6%) of the gross face amount of all Accounts
factored with us, but in no event less than $3.00 per invoice. In addition, you
will pay a fee of one-quarter of one percent (1/4 of 1%) of the gross face
amount of each Account for each thirty (30) day period or part thereof by which
the longest terms of sale applicable to such Account exceed ninety (90) days
(whether as originally stated or as a result of a change of terms requested by
you or the customer). For Accounts arising from sales to customers located
outside the fifty states of the United States of America, you will pay us an
additional factoring fee of one percent (1%) of the gross face amount of all
such Accounts. All factoring fees or charges are due and charged to your account
upon our purchase of the underlying Account. Commencing ___________________, if
the actual factoring fees or charges paid to us by you during any year or part
thereof ("Period"), is less than $48,000.00 ("Minimum Factoring Fees"), we shall
charge your account as of the end of such Period with an amount equal to the
difference between the actual factoring fees or charges paid during such Period
and said Minimum Factoring Fees.

      15.2 You agree to pay all costs and expenses incurred by us in connection
with the preparation, execution, administration and enforcement of this
Agreement, including all reasonable fees and expenses attributable to the
services of our attorneys (whether in-house or outside), search fees and public
record filing fees. Furthermore, you agree to pay to us our fees (as more fully
set forth in the Guide, see section 18.2 below) including fees for: (a) special
reports prepared by us at your request; (b) wire transfers; (c) handling change
of terms requests relating to Accounts; and (d) your usage of our on-line
computer services. Beginning on the first of the month six months from the date
hereof, you also agree to pay us our fees for: (i) [intentionally deleted]; (ii)
crediting your account with proceeds of non-factored invoices received by us;
and (iii) charge backs or invoices factored with us that were paid directly to
you. All such fees will be charged to your account when incurred. Our fees may
be changed by us from time to time upon notice to you; however, any failure to
give you such notice does not constitute a breach of this Agreement and does not
impair our ability to institute any such change.

      15.3 Any tax or fee of any governmental authority imposed on or arising
from any transactions between us, any sales made by you, or any inventory
relating to such sales is your sole responsibility (other than income and
franchise taxes imposed on us which are not related to any specific transaction
between us). If we are required to withhold or pay
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                                        9


any such tax or fee, or any interest or penalties thereon, you hereby indemnify
and hold us harmless therefor and we shall charge your account with the full
amount thereof.

      16. TERMINATION

      16.1 You may terminate this Agreement only as of an Anniversary Date and
then only by giving us at least sixty (60) days prior written notice of
termination. "Anniversary Date" means the last day of the month occurring one
year from the date hereof, and the same date in each year thereafter. In the
event that this Agreement is terminated by you prior to an Anniversary Date, we
shall be entitled to the unpaid portion of the Minimum Factoring Fees, if any,
for such Period, as provided in section 15.1 above, as of the effective date of
termination. Except as otherwise provided, we may terminate this Agreement at
any time by giving you at least sixty (60) days prior written notice of
termination. However, we may terminate this Agreement immediately, without prior
notice to you, upon the occurrence of an Event of Default (defined in section
17.1 below).

      16.2 This Agreement remains effective between us until terminated as
herein provided. Unless sooner demanded, all Obligations will become immediately
due and payable upon any termination of this Agreement.

      16.3 All of our rights, liens and security interests hereunder continue
and remain in full force and effect after any termination of this Agreement and
pending a final accounting, we may withhold any balances in your account unless
we are supplied with an indemnity satisfactory to us to cover all Obligations.
You agree to continue to assign accounts receivable to us and to remit to us all
collections on accounts receivable, until all Obligations have been paid in full
or we have been supplied with an indemnity satisfactory to us to cover all
Obligations.

      17. EVENTS OF DEFAULT AND REMEDIES UPON DEFAULT

      17.1 It is an "Event of Default" under this Agreement if: (a) your
business ceases or a meeting of your creditors is called; (b) any bankruptcy,
insolvency, arrangement, reorganization, receivership or similar proceeding is
commenced by or against you under any federal or state law; (c) you breach any
representation, warranty or covenant contained in this Agreement; or (d) you
fail to pay any Obligation when due.

      17.2 After the occurrence of an Event of Default which is not waived by
us, we may terminate this Agreement without notice to you. We shall then have
immediate access to, and may remove from any premises where same may be located,
any and all Books and Records as may pertain to the Accounts, Returned Goods and
any other collateral
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                                       10


hereunder. Furthermore, as may be necessary to administer and enforce our rights
in the Accounts, Returned Goods and any other collateral hereunder, or to
facilitate the collection or realization thereof, we have your permission to:
(a) use (at your expense) your personnel, supplies, equipment, computers and
space, at your place of business or elsewhere; and (b) notify postal authorities
to change the address for delivery of your mail to such address as we may
designate and to receive and open your mail. We agree to turn over to you or
your representative all mail not related to the aforesaid purposes.

      17.3 After the occurrence of an Event of Default which is not waived by
us, with respect to any other property or collateral in which we have a security
interest, we shall have all of the rights and remedies of a secured party under
Article 9 of the Uniform Commercial Code. If notice of intended disposition of
any such property or collateral is required by law, it is agreed that five (5)
days notice constitutes reasonable notice. The net cash proceeds resulting from
the exercise of any of the foregoing rights, after deducting all charges, costs
and expenses (including reasonable attorneys' fees) will be applied by us to the
payment or satisfaction of the Obligations, whether due or to become due, in
such order as we may elect. You remain liable to us for any deficiencies. With
respect to Factor Risk Accounts and Returned Goods relating thereto, you hereby
confirm that we are the owners thereof, and that our rights of ownership permit
us to deal with this property as owner and you confirm that you have no interest
therein.

      18. MISCELLANEOUS PROVISIONS

      18.1 This Agreement, and all attendant documentation, as the same may be
amended from time to time, constitutes the entire agreement between us with
regard to the subject matter hereof, and supersedes any prior agreements or
understandings. This Agreement can be changed only by a writing signed by both
of us. Our failure or delay in exercising any right hereunder will not
constitute a waiver thereof or bar us from exercising any of our rights at any
time. The validity, interpretation and enforcement of this Agreement is governed
by the laws of the State of New York, excluding the conflict laws of such State.

      18.2 The Client Service Guide, as supplemented and amended from time to
time (the "Guide") has been furnished to you or is being furnished to you
concurrently with the signing of this Agreement, and by your signature below you
acknowledge receipt thereof. The Guide provides information on credit approval
processes, accounting procedures and fees. The procedures for Electronic Batch
Transmission are covered in supplemental instructions to the Guide. From time to
time, we may provide you with amendments, additions, modifications, revisions or
supplements to the Guide, which will be operative for transactions between us.
All information and exhibits contained in the Guide, on any screen accessed by
you, and on any print-outs, reports, statements or notices received by you are,
and will be, our exclusive property and are not to be disclosed to, or used by,
anyone other than you, your employees or your professional advisors, in whole or
in part, unless we have consented in writing.
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                                       11


      18.3 This Agreement binds and benefits each of us and our respective
successors and assigns, provided, however, that you may not assign this
Agreement or your rights hereunder without our prior written consent.

      18.4 Section headings are for convenience only and are not controlling.
The use of "including" means "including without limitation".

      18.5 If any provision of this Agreement is contrary to, prohibited by, or
deemed invalid under applicable laws or regulations, such provision will be
inapplicable and deemed omitted to such extent, but the remainder will not be
invalidated thereby and will be given effect so far as possible.

      18.6 You shall take all action reasonably necessary to assure that your
computer-based systems are able to effectively process date-sensitive data
functions. You represent and warrant that the "Year 2000" problem (that is, the
inability of certain computer applications to recognize and properly perform
date-sensitive functions involving certain dates on or about or subsequent to
December 31, 1999) will not result in a material adverse effect on your
business, assets or operations. You reasonably anticipate that all computer
applications which are material to your business will, on a timely basis, be
able to properly perform date-sensitive functions for all dates on and after
January 1, 2000. Upon our request from time to time, you shall provide to us
assurances that your computer systems and software are or will be Year 2000
compliant on a timely basis, all in form and substance reasonably satisfactory
to us.


                [Remainder of this page intentionally left blank]
<PAGE>

      19. JURY TRIAL WAIVER

      To the extent permitted by applicable law, we each hereby waive any right
to a trial by jury in any action or proceeding arising directly or indirectly
out of this Agreement, or any other agreement or transaction between us or to
which we are parties.

      If the foregoing is in accordance with your understanding, please so
indicate by signing and returning to us the original and one copy of this
Agreement. This Agreement will take effect as of the date set forth above but
only after being accepted below by one of our officers in New York, after which
we shall forward a fully executed copy to you for your files.

                                       Very truly yours,

                                       THE CIT GROUP/COMMERCIAL SERVICES, INC.


                                       By /s/ Justin M. Coffey
                                          --------------------------------------
                                          Name: Justin M. Coffey
                                          Title: Vice President


Read and Agreed to:

LEVCOR INTERNATIONAL, INC.


By /s/ Robert A. Levinson
    ------------------------
   Name:
   Title: Chairman/Pres.


                                       Accepted at: New York, New York

                                       THE CIT GROUP/COMMERCIAL SERVICES, INC.

          
                                       By /s/ Patrick Rohan
                                          --------------------------------------
                                          Name:
                                          Title: