Document:

Mohawk - Amended and Restated Credit and Security Agreement

 Exhibit 10.1

  

AMENDED AND RESTATED CREDIT AND SECURITY
AGREEMENT

 

Dated as of
August 4, 2003

 

Among

 

MOHAWK FACTORING, INC., as Borrower,

 

MOHAWK SERVICING, INC., as Servicer,

 

BLUE RIDGE ASSET FUNDING CORPORATION,

 

THREE PILLARS FUNDING CORPORATION,

 

SUNTRUST CAPITAL MARKETS, INC., as a Co-Agent,

 

and

 

WACHOVIA BANK, NATIONAL ASSOCIATION, as a Co-Agent and
 

Administrative Agent

 

TABLE OF CONTENTS

Page

 

	ARTICLE
    I. THE ADVANCES	 2
	Section
    1.1........... Credit Facility	 2
	Section
    1.2........... Increases	 3
	Section
    1.3........... Decreases	 3
	Section
    1.4........... Deemed Collections; Borrowing Limit	 3
	Section
    1.5........... Payment Requirements	 4
	Section 1.6........... Ratable
Loans; Funding Mechanics; Liquidity Fundings	 4
	ARTICLE
II. PAYMENTS AND COLLECTIONS   	5
	Section
    2.1........... Payments	 5
	Section
    2.2........... Collections Prior to Amortization; Demand for Payment of
    Certain Demand Advances	 6
	Section
    2.3........... Demand for Payment of Demand Advances on the Amortization
    Date; Collections Following Amortization	 6
	Section 2.4........... Payment
Recission	 7
	ARTICLE
    III. COMMERCIAL PAPER FUNDING	
    7
	Section
    3.1........... CP Costs	
    7
	Section
    3.2........... Calculation of CP Costs	 7
	Section
    3.3........... CP Costs Payments	 8
	Section
    3.4........... Default Rate	 8
	ARTICLE
    IV. LIQUIDITY FUNDING	 8
	Section
    4.1........... Liquidity Funding	 8
	Section
    4.2........... Interest Payments	
    8
	Section
    4.3........... Selection and Continuation of Interest Periods	
    8
	Section
    4.4........... Liquidity Bank Interest Rates	 9
	Section 4.5........... Suspension
of the LIBO Rate	 9
	
    Section 4.6........... Default Rate	 9
	
    ARTICLE V. REPRESENTATIONS AND WARRANTIES
	
    Section 5.1........... Representations and Warranties of the Loan Parties	 9
	
    Section 5.2........... Liquidity Bank Representations and Warranties	 13
	ARTICLE
VI. CONDITIONS OF ADVANCES..   	 14
	
    Section 6.1........... Conditions Precedent to Initial Advance	 14
	
    Section 6.2........... Conditions Precedent to All Advances	 14
	
    ARTICLE VII. COVENANTS
	
    Section 7.1........... Affirmative Covenants of the Loan Parties	 14
	
    Section 7.2........... Negative Covenants of the Loan Parties	 19
	ARTICLE
VIII. ADMINISTRATION AND
COLLECTION   	
    21
	Section 8.1........... Designation
of Servicer	 21
	Section 8.2........... Certain
Duties of Servicer	 21
	
    Section 8.3........... Collection Notices	 22
	
    Section 8.4........... Responsibilities of Borrower  	 23
	
    Section 8.5........... Monthly Reports	 23
	
    Section 8.6........... Servicing Fee	 23

 

	
    ARTICLE IX. AMORTIZATION EVENTS	 23
	
    Section 9.1........... Amortization Events	 23
	
    Section 9.2........... Remedies	 25
	
    ARTICLE X. INDEMNIFICATION	 26
	
    Section 10.1........... Indemnities by the Loan Parties	 26
	
    Section 10.2........... Increased Cost and Reduced Return	 28
	
    Section 10.3........... Other Costs and Expenses	 29
	ARTICLE
XI. THE AGENTS   	
    29
	
    Section 11.1........... Authorization and Action.	 29
	
    Section 11.2........... Delegation of Duties	 30
	
    Section 11.3........... Exculpatory Provisions	 30
	
    Section 11.4........... Reliance by the Agents	 31
	
    Section 11.5........... Non-Reliance on Other Agents and Other Lenders	 31
	
    Section 11.6........... Reimbursement and Indemnification	 31
	
    Section 11.7........... Agents in their Individual Capacities	 31
	
    Section 11.8........... Conflict Waivers	 32
	Section 11.9........... UCC
    Filings	 32
	
    Section 11.10........... Successor Administrative Agent	 32
	
    ARTICLE XII. ASSIGNMENTS; PARTICIPATIONS	 33
	
    Section 12.1........... Assignments	 33
	
    Section 12.2........... Participations	 34

	
    ARTICLE XIII. SECURITY INTEREST	 35
	
    Section 13.1........... Grant of Security Interest	 35
	
    Section 13.2........... Termination after Final Payout Date	 35
	
    Section 13.3........... Excluded Receivables	 35
	
    ARTICLE XIV. MISCELLANEOUS  	 35
	
    Section 14.1........... Waivers and Amendments	
    35
	
    Section 14.2........... Notices	 36
	
    Section 14.3........... Ratable Payments	 37
	
    Section 14.4........... Protection of Administrative Agent's Security
    Interest	 37
	
    Section 14.5........... Confidentiality	 38
	
    Section 14.6........... Bankruptcy Petition	 39
	
    Section 14.7........... CHOICE OF LAW	 39
	
    Section 14.8........... CONSENT TO JURISDICTION	 39
	
    Section 14.9........... WAIVER OF JURY TRIAL	 39
	
    Section 14.10........... Integration; Binding Effect; Survival of Terms	 40
	Section 14.11........... Counterparts;
Severability; Section References	 40

Exhibits
and Schedules

 

Exhibit I                        Definitions

Exhibit II                       Form of Borrowing Notice

Exhibit III                      Places of Business of the Loan Parties;
Locations of Records; Federal Employer Identification Number(s)

Exhibit IV                      Names of Collection
Banks; Collection Accounts

Exhibit V                       Form of Compliance
Certificate

Exhibit VI                      Form of Collection
Account Agreement

Exhibit VII                     Form of Assignment
Agreement

Exhibit VIII                    Credit and Collection
Policy

Exhibit IX                      Form of Monthly Report

Exhibit X                       Form of Performance
Undertaking

Exhibit XI                      Form of Reduction Notice

Schedule A                        Commitments

Schedule B                        Closing Documents

AMENDED AND RESTATED CREDIT AND SECURITY AGREEMENT

 

This
AMENDED AND RESTATED Credit and Security Agreement,dated as of August 4, 2003 is entered
into by and among:

(a)               
Mohawk Factoring, Inc., a Delaware corporation ("Borrower")
and successor by merger to DT/Mohawk Factoring, LLC, a Delaware limited
liability company ("DT/Mohawk Factoring"),

(b)              
Mohawk Servicing, Inc., a Delaware corporation ("Mohawk
Servicing"), as initial Servicer (the Servicer together with Borrower,
the "Loan
Parties" and each, a "Loan Party"),

(c)               
Blue Ridge Asset Funding Corporation, a Delaware corporation
(together with its successors, "Blue Ridge" or a "Conduit") and Wachovia
Bank, National Association, in its capacity as a Liquidity Bank to Blue Ridge
(together with its successors, "Wachovia" and together with Blue
Ridge, the "Blue Ridge Group"),  

(d)              
Three Pillars Funding Corporation, a Delaware corporation
(together with its successors, "TPFC" or a "Conduit")
and SunTrust Capital Markets, Inc., in its capacity as a Liquidity Bank to TPFC
(together with its successors, "SunTrust" and together with TPFC,
the "TPFC Group"),  

(e)               
The issuers of Commercial Paper from time to time party hereto
(together with their respective successors, individually, a "Conduit" and
collectively with Blue Ridge and TPFC, the "Conduits") and the
financial institutions acting in the capacity of a Liquidity Bank to such other
Conduits (together with such financial institutions', successors and such
Conduit, a "Conduit Group" and collectively with the TPFC Group
and the Blue Ridge Group, the "Conduit Groups"),

(f)                
Wachovia Bank, National Association, in its capacity as agent
for the Blue Ridge Group (together with its successors and assigns in such
capacity, the "Blue Ridge Agent" or a "Co-Agent"), SunTrust Capital
Markets, Inc., in its capacity as agent for the TPFC Group (together with its
successors and assigns in such capacity, the "TPFC Agent" or a "Co-Agent")
and any other administrative agent for a Conduit Group from time to time party
hereto (together with their respective successors, individually a "Co-Agent"
and collectively with the Blue Ridge Agent and the TPFC Agent the "Co-Agents"),
and

(g)               
Wachovia Bank, National Association, as agent for the Conduit
Groups and the Co-Agents (together with its successors and assigns hereunder,
the
"Administrative Agent" and together with the Co-Agents, the "Agents"),

and amends, restates and
consolidates (i) that certain Credit and Security Agreement dated as of October
25, 2000, as amended, by and among Borrower, Mohawk Servicing, the Liquidity
Banks party thereto, Blue Ridge and Wachovia in its capacity as agent
thereunder and (ii) that certain Loan Agreement dated as of May 14, 2002 by and
among Borrower (as successor to DT/Mohawk Funding, LLC), Dal-Tile Corporation,
TPFC and SunTrust in its capacity as agent thereunder.

Unless defined elsewhere herein, capitalized
terms used in this Agreement shall have the meanings assigned to such terms in
Exhibit I.

PRELIMINARY
STATEMENTS

Borrower desires to borrow from the Lenders from time
to time.

The Conduits may, in their absolute and sole
discretion, make Advances to Borrower from time to time.

In the event that any Conduit declines to make its
Group's Percentage of any Advance, the applicable Conduit's Liquidity Banks
shall, at the request of Borrower, make such Liquidity Banks' Group's
Percentage of Advances from time to time.

Wachovia Bank, National Association has been
requested and is willing to act as Administrative Agent on behalf of the
Co-Agents and the Conduit Groups in accordance with the terms hereof.

ARTICLE I.

THE ADVANCES

Section
1.1             
Credit Facility.

(a)               
Upon the terms and subject to the conditions hereof, from time
to time prior to the Facility Termination Date upon receipt of a copy of each
Borrowing Notice from Borrower, each of
the Co-Agents shall determine whether its
Conduit will fund a Loan in an amount equal to its Group's Percentage of the
requested Advance specified in such Borrowing Notice.  In the event that a Conduit elects not to make any such Loan to
Borrower, the applicable Co-Agent shall promptly notify Borrower and, unless
Borrower cancels its Borrowing Notice,
each of such Conduit's Liquidity Banks severally agrees to make its Pro Rata
Share of its Group's Percentage of such Loan to Borrower, on the terms and
subject to the conditions hereof, provided that at no time may the
aggregate principal amount of such Conduit's and such Conduit's Liquidity
Banks' Loans outstanding exceed the lesser of (i) the aggregate amount of such Conduit's Liquidity Banks'
Commitments, and (ii) such Conduit's
Group's Percentage of the Borrowing Base (such lesser amount, the "Conduit Allocation Limit"). 
 

Each of the Advances, and all other Obligations,
shall be secured by the Collateral as provided in Article XIII.

(b)              
Borrower may, upon at least 10 Business Days' notice to the
Co-Agents, terminate in whole or reduce in part, ratably among the Liquidity
Banks in each Group in accordance with such Group's Percentage, the unused
portion of the Aggregate Commitment; provided that each partial reduction
of the Aggregate Commitment shall be in an amount equal to $5,000,000 per Group
(or a larger integral multiple of $1,000,000 per Group if in excess thereof)
and shall reduce the Commitments of the Liquidity Banks in each Group ratably
in accordance with their respective Pro Rata Shares.

2

Section 1.2             

Increases

.  Borrower shall
provide the Co-Agents with at least one (1) Business Day's prior notice in a
form set forth as Exhibit II hereto of each Advance, provided such notice is
received by each Co-Agent no later than 12:00 noon on such Business Day (each,
a "Borrowing
Notice").  Each Borrowing Notice
shall be subject to Section 6.2 hereof and, except as set forth below, shall be
irrevocable and shall specify the requested increase in Aggregate Principal
(which shall not be less than $1,000,000 per Group or a larger integral
multiple of $100,000 per Group), the Borrowing Date (which, in the case of any
Advance after the initial Advance hereunder, shall only be on a Settlement
Date), and, in the case of an Advance which Borrower has been notified by the
applicable Co-Agent will be funded by the applicable Group's Liquidity Banks,
the requested Interest Rate and Interest Period.  If a Conduit declines to make its Group's Percentage of a proposed
Advance, Borrower may cancel the Borrowing Notice.  On the date of each Advance, upon satisfaction of the applicable
conditions precedent set forth in Article VI, the applicable Conduit or the
applicable Conduit's Liquidity Banks, as applicable, shall make the proceeds of
its Loan comprising such Group's Percentage of such requested Advance available
to its Group's Co-Agent in immediately available funds on the proposed date of
borrowing.  Upon receipt by a Co-Agent
of such Loan proceeds, such Co-Agent shall deposit to the Facility Account, in
immediately available funds, no later than 12:00 noon (New York time), an
amount equal to (i) in the case of a Conduit, such Conduit's Group's Percentage
of the principal amount of the requested Advance or (ii) in the case of a
Conduit's Liquidity Bank, each such Liquidity Bank's Pro Rata Share of such
Liquidity Bank's Group's Percentage of the principal amount of the requested
Advance.

Section 1.3             

Decreases

.  Except as
provided in Section 1.4, Borrower shall provide the Co-Agents with prior
written notice in conformity with the Required Notice Period in the form
attached hereto as Exhibit XI (a "Reduction Notice") of any proposed
reduction of Aggregate Principal.  Such
Reduction Notice shall designate (i) the date (the "Proposed Reduction Date")
upon which any such reduction of Aggregate Principal shall occur (which date
shall give effect to the applicable Required Notice Period), and (ii) the
amount of Aggregate Principal to be reduced which shall be applied ratably to
the Loans of the Conduits and the Liquidity Banks in accordance with the amount
of principal (if any) owing to the Conduits (ratably, based on their Group's
Percentage of such reduction), on the one hand, and the amount of principal (if
any) owing to the Liquidity Banks (ratably, based on their respective Pro Rata
Shares of their Group's Percentage of such reduction), on the other hand (the "Aggregate
Reduction").  Only one (1)
Reduction Notice with respect to any Proposed Reduction Date shall be
outstanding at any time.

Section 1.4             

Deemed Collections; Borrowing Limit

(a)               
If on any day:

(i)                 
the Outstanding Balance of any Receivable is reduced by the
Servicer as a result of any defective or rejected goods or services or any
other adjustment (other than a Cash Discount) by any Originator or any
Affiliate thereof, or as a result of any tariff or other governmental or
regulatory charge, or

(ii)               
the Outstanding Balance of any Receivable is reduced or
canceled by the Servicer 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

3

(iii)              
the Outstanding Balance of any Receivable is reduced by the
Servicer on account of the obligation of any Originator or any Affiliate
thereof to pay to the related Obligor any rebate or refund, or

(iv)             
the Outstanding Balance of any Receivable is less than the
amount included in calculating the Net Pool Balance for purposes of any Monthly
Report (for any reason other than such Receivable becoming a Defaulted
Receivable), or

(v)               
any of the representations or warranties of Borrower set forth
in Section 5.1(i), (j), (r), (s), (t) or (u) were not true when made with
respect to any Receivable,

then, on such day, Borrower shall be deemed to have
received a Collection of such Receivable (A) in the case of clauses (i)-(iv)
above, in the amount of such reduction or cancellation or the difference
between the actual Outstanding Balance and the amount included in calculating
such Net Pool Balance, as applicable; and (B) in the case of clause (v) above,
in the amount of the Outstanding Balance of such Receivable and, effective as
of the date on which the next succeeding Monthly Report is required to be
delivered, the Borrowing Base shall be reduced by the amount of such Deemed
Collection.

(b)              
Borrower shall ensure that the Aggregate Principal at no time
exceeds the Borrowing Limit.  If, on any
Business Day, the aggregate outstanding principal amount of the Loans from any
Group exceeds such Group's Conduit Allocation Limit, or the aggregate principal
amount of the Loans outstanding from such Group's Conduit exceeds the Liquidity
Commitments of such Group's Liquidity Banks pursuant to such Group's Liquidity
Agreement divided by 102%, Borrower shall prepay such Loans
by wire transfer to the applicable Co-Agent received not later than 1:00 p.m. (New York City time)
on thenext succeeding
Settlement Date of an amount sufficient to eliminate such excess, together with
accrued and unpaid interest on the amount prepaid (as allocated by the
applicable Co-Agent), such that after giving effect to such payment the
Aggregate Principal is less than or equal to the Borrowing Limit and the
applicable Group's Percentage of the Aggregate Principal is less than or equal
to the applicable Group's Conduit Allocation Limit.

Section 1.5             

Payment Requirements

.  All amounts to
be paid or deposited by any Loan Party pursuant to any provision of this
Agreement shall be paid or deposited in accordance with the terms hereof no
later than 1:00 p.m. (New York time) on the day when due in immediately
available funds, and if not received before 1:00 p.m. (New York time) shall be
deemed to be received on the next succeeding Business Day.  If such amounts are payable to a Lender they
shall be paid to the applicable Co-Agent Account, for the account of such
Lender, until otherwise notified by such Co-Agent.  All computations of CP Costs, Interest, per annum fees calculated as part of any CP Costs, per annum fees hereunder and per annum fees under the Fee Letter
shall be made on the basis of a year of 360 days for the actual number of days
elapsed.  If any amount hereunder shall
be payable on a day which is not a Business Day, such amount shall be payable
on the next succeeding Business Day.

Section 1.6             

Ratable Loans; Funding Mechanics; Liquidity Fundings

4

(a)               
Each Advance hereunder shall consist of one or more Loans made
by the Conduits and/or the applicable Liquidity Banks.

(b)              
Each Lender funding any Loan shall wire transfer the principal
amount of its Loan to its Co-Agent in immediately available funds not later than
12:00 noon (New York City time) on the applicable Borrowing Date and, subject
to such Co-Agent's receipt of such Loan proceeds, such Co-Agent shall wire
transfer such funds to the account specified by Borrower in its Borrowing
Request not later than 2:00 p.m. (New York City time) on such Borrowing Date.

(c)               
While it is the intent of each Conduit to fund each requested
Advance through the issuance of its respective Commercial Paper, the parties
acknowledge that if any Conduit is unable, or determines that it is
undesirable, to issue Commercial Paper to fund all or any portion of its Loans,
or is unable to repay such Commercial Paper upon the maturity thereof, such
Conduit shall put all or any portion of its Loans to its Liquidity Banks at any
time pursuant to its applicable Liquidity Agreement to finance or refinance the
necessary portion of its Loans through a Liquidity Funding to the extent
available.  The Liquidity Fundings may
be Alternate Base Rate Loans or LIBO Rate Loans, or a combination thereof, selected
by Borrower in accordance with Article IV. 
Regardless of whether a Liquidity Funding constitutes the direct funding
of a Loan, an assignment of a Loan made by a Conduit or the sale of one or more
participations in a Loan made by a Conduit, each Liquidity Bank in such
Conduit's Group participating in a Liquidity Funding shall have the rights of a
"Lender" hereunder with the same force and effect as if it had directly made a
Loan to Borrower in the amount of its Liquidity Funding.

(d)              
Nothing herein shall be deemed to commit any Conduit to make
Loans.

ARTICLE II.

PAYMENTS AND COLLECTIONS

Section 2.1             

Payments

.  Borrower
hereby promises to pay:

(a) the Aggregate Principal on and after the Facility
Termination Date as and when Collections are received;

(b) the fees set forth in the Fee Letter on the
dates specified therein;

(c) all accrued and unpaid Interest on the Alternate
Base Rate Loans on each Settlement Date applicable thereto;

(d) all accrued and unpaid Interest on the LIBO Rate
Loans on the last day of each Interest Period applicable thereto;

(e) all accrued and unpaid CP Costs on the CP Rate
Loans on each Settlement Date; and

(f) all Broken Funding Costs and Indemnified Amounts
upon demand.

5

Section 2.2             

Collections Prior to Amortization; Demand for
Payment of Certain Demand Advances

(a)               
On each Settlement Date prior to the Amortization Date, the
Servicer shall deposit to the applicable Co-Agent Account, for distribution to
the applicable Lenders, the applicable Percentage of a portion of the
Collections received by it during the preceding Settlement Period (after
deduction of its Servicing Fee) equal to the sum of the following amounts for
application to the Obligations in the order specified:

first, ratably to the payment of all
invoiced accrued and unpaid CP Costs, Interest and Broken Funding Costs (if
any) that are then due and owing to the applicable Conduit,

second, ratably to the payment of
all accrued and unpaid fees under the Fee Letter (if any) that are then due and
owing to the applicable Conduit or its Co-Agent,

third, if required under Section 1.3
or 1.4, to the ratable reduction of the applicable Conduit's Percentage of the
Aggregate Principal, and

fourth, for the ratable payment of
all other unpaid Obligations, if any, that are then due and owing to such
Conduit, its Co-Agent or the related Indemnified Parties.

The balance,
if any, shall be transferred to Borrower or otherwise in accordance with
Borrower's instructions.  Collections
applied to the payment of Obligations shall be distributed in accordance with
the aforementioned provisions, and, giving effect to each of the priorities set
forth above in this Section 2.2(a), shall be shared ratably (within each
priority) among the applicable Co-Agent and the Lenders in its Group in
accordance with the amount of such Obligations owing to each of them in respect
of each such priority.

(b) If the Collections are insufficient to pay the
Servicing Fee and the Obligations specified above on any Settlement Date,
Borrower shall make demand for repayment of any outstanding Demand Advances in
an aggregate amount equal to the lesser of (i) the amount of such shortfall in
Collections, and (ii) the aggregate outstanding principal balance of the Demand
Advances, together with all accrued and unpaid interest thereon.

Section 2.3             

Demand for Payment of Demand Advances on the
Amortization Date; Collections Following Amortization

(a)               
On the Amortization Date, Borrower hereby agrees to make
demand for payment of all Demand Advances, together with all accrued and unpaid
interest thereon, in an amount up to the outstanding balances of such Demand
Advances, but not to exceed the then outstanding Obligations.

(b)              
On the Amortization Date and on each day thereafter, to the
extent the Obligations have not otherwise been paid, the Servicer shall set
aside and hold in trust, for the Secured Parties, all Collections received on
such day.  On and after the Amortization
Date, the Servicer shall, on each Settlement Date and on each other Business
Day specified by the Administrative Agent at the direction of any Co-Agent
(after deduction of any accrued and unpaid Servicing Fee as of such date):  (i) remit to the applicable Co-Agent Account
the applicable Group's Percentage of the amounts set aside pursuant to the
preceding two sentences, and (ii) apply such amounts to reduce the Obligations
as follows:

6

first, to the reimbursement of the
applicable Conduit's Group's Percentage Share of the Administrative Agent's
reasonable costs incurred in connection with the collection of amounts due
under this Agreement and enforcement of this Agreement,

second, ratably to the payment of
all accrued and unpaid CP Costs, Interest and Broken Funding Costs (if any)
that are then due and owing to the applicable Conduit,

third, ratably to the payment of all
accrued and unpaid fees under the Fee Letter,

fourth, to the ratable reduction of
such Conduit's Percentage of the Aggregate Principal,

fifth, for the ratable payment of
all other unpaid Obligations that are then due and owing to such Conduit, its
Co-Agent or the related Indemnified Parties, and

sixth, after the Obligations have
been indefeasibly reduced to zero, to Borrower.

Collections applied to the payment of Obligations
shall be distributed in accordance with the aforementioned provisions, and,
giving effect to each of the priorities set forth above in this Section 2.3(b),
shall be shared ratably (within each priority) among the Agent and the Lenders
in accordance with the amount of such Obligations owing to each of them in
respect of each such priority.

Section 2.4             

Payment Recission

.  No payment of
any of the Obligations shall be considered paid or applied hereunder to the
extent that, at any time, all or any portion of such payment or application is
rescinded by application of law or judicial authority, or must otherwise be
returned or refunded for any reason.  Borrower shall remain obligated for the amount of any payment or
application so rescinded, returned or refunded, and shall promptly pay to the
applicable Co-Agent Account (in each case for application to the Person or
Persons who suffered such rescission, return or refund) the full amount
thereof, plus Interest on such amount at the Default Rate from the date of any
such recission, return or refunding.

ARTICLE III.

COMMERCIAL PAPER FUNDING

Section 3.1             

CP Costs

.  Borrower shall
pay CP Costs with respect to the principal balance of the Loans from time to
time outstanding.  Each Loan of a
Conduit that is funded substantially with Pooled Commercial Paper will accrue
CP Costs each day on a pro rata basis, based upon the percentage share that the
principal in respect of such Loan represents in relation to all assets held by
such Conduit and funded substantially with related Pooled Commercial Paper on
such day.

Section 3.2             

Calculation of CP Costs

.  As soon as
practicable, and not later than the 3rd Business Day immediately
preceding each Monthly Reporting Date, each Conduit shall calculate the
aggregate amount of CP Costs applicable to its CP Rate Loans for the
Calculation Period then most recently ended and shall notify Borrower of such
aggregate amount, which notice shall include a reasonably detailed description
of such calculations.

7

Section 3.3             

CP Costs Payments

.  On each
Settlement Date, Borrower shall pay to the Co-Agents (for the benefit of their
respective Conduit) an aggregate amount equal to all accrued and unpaid CP
Costs in respect of the principal associated with all CP Rate Loans for the
Calculation Period then most recently ended in accordance with Article II.

Section 3.4             

Default Rate

.  From and after
the occurrence of an Amortization Event, all Loans of the Conduits shall accrue
Interest at the Default Rate and shall cease to be CP Rate Loans.

ARTICLE IV.

LIQUIDITY FUNDING

Section 4.1             

Liquidity Funding

.  Prior to the
occurrence of an Amortization Event, the outstanding principal balance of each
Liquidity Funding shall accrue interest for each day during its Interest Period
at either the LIBO Rate or the Alternate Base Rate in accordance with the terms
and conditions hereof.  Until Borrower
gives notice to the applicable Co-Agent of another Interest Rate in accordance
with Section 4.4, the initial Interest Rate for any Loan transferred to the
Liquidity Banks by the applicable Conduit pursuant to the applicable Liquidity
Agreement shall be the Alternate Base Rate (unless the Default Rate is then
applicable).  If the applicable
Liquidity Banks acquire by assignment from the applicable Conduit any Loan
pursuant to the applicable Liquidity Agreement, each Loan so assigned shall
each be deemed to have an Interest Period commencing on the date of any such
assignment.

Section 4.2             

Interest Payments

.  On the
Settlement Date for each Liquidity Funding, Borrower shall pay to the
applicable Co-Agent (for the benefit of the Liquidity Banks in its Group) an
aggregate amount equal to the accrued and unpaid Interest for the entire
Interest Period of each such Liquidity Funding in accordance with Article II.

Section 4.3             
Selection and Continuation of Interest Periods.

(a)               
With consultation from the applicable Co-Agent, Borrower shall
from time to time request Interest Periods for the Liquidity Fundings, provided
that if at any time any Liquidity Funding is outstanding, Borrower
shall always request Interest Periods such that at least one Interest Period
shall end on the date specified in clause (A) of the definition of Settlement
Date.

(b)              
Borrower or the applicable Co-Agent, upon notice to and
consent by the other received at least three (3) Business Days prior to the end
of an Interest Period (the "Terminating Tranche") for any
Liquidity Funding, may, effective on the last day of the Terminating
Tranche:  (i) divide any such Liquidity
Funding into multiple Liquidity Fundings, (ii) combine any such Liquidity
Funding with one or more other Liquidity Fundings that have a Terminating
Tranche ending on the same day as such Terminating Tranche or (iii) combine any
such Liquidity Funding with a new Liquidity Funding to be made by the applicable
Liquidity Banks on the day such Terminating Tranche ends.

8

Section 4.4             

Liquidity Bank Interest Rates

.  Borrower may
select the LIBO Rate or the Alternate Base Rate for each Liquidity
Funding.  Borrower shall by 12:00 noon
(New York time):  (i) at least three (3)
Business Days prior to the expiration of any Terminating Tranche with respect
to which the LIBO Rate is being requested as a new Interest Rate and (ii) at
least one (1) Business Day prior to the expiration of any Terminating Tranche
with respect to which the Alternate Base Rate is being requested as a new
Interest Rate, give the applicable Co-Agent irrevocable notice of the new
Interest Rate for the Liquidity Funding associated with such Terminating
Tranche.  Until Borrower gives notice to
the applicable Co-Agent of another Interest Rate, the initial Interest Rate for
any Loan transferred to the applicable Liquidity Banks pursuant to the
applicable Liquidity Agreement shall be the Alternate Base Rate (unless the
Default Rate is then applicable).

Section 4.5             

Suspension of the LIBO Rate

.   

(a)               
If any Liquidity Bank notifies its applicable Co-Agent that it
has reasonably determined that funding its Pro Rata Share of its Group's
Percentage of the Liquidity Fundings at a LIBO Rate would violate any
applicable law, rule, regulation, or directive of any governmental or
regulatory authority, or that (i) deposits of a type and maturity appropriate
to match fund its Liquidity Funding at such LIBO Rate are not available or (ii)
such LIBO Rate does not accurately reflect the cost of acquiring or maintaining
a Liquidity Funding at such LIBO Rate, then such Co-Agent shall suspend the
availability of such LIBO Rate and require Borrower to select the Alternate
Base Rate for any Liquidity Funding of such Liquidity Bank accruing Interest at
such LIBO Rate.

(b)              
If less than all of the Liquidity Banks of any applicable
Group give a notice to such Group's Co-Agent pursuant to Section 4.5(a), each
Liquidity Bank which gave such a notice shall be obliged, at the request of
Borrower, the applicable Conduit or the applicable Co-Agent, to assign all of
its rights and obligations hereunder to (i) another Liquidity Bank in its Group
or (ii) another funding entity nominated by Borrower or the applicable Co-Agent
that is an Eligible Assignee willing to participate in this Agreement through
the Liquidity Termination Date in the place of such notifying Liquidity Bank; provided
that (i) the notifying Liquidity Bank receives payment in full,
pursuant to an Assignment Agreement, of all Obligations owing to it (whether
due or accrued), and (ii) the replacement Liquidity Bank otherwise satisfies
the requirements of Section 12.1(b).

Section 4.6             

Default Rate

.  From and after
the occurrence of an Amortization Event, all Liquidity Fundings shall accrue
Interest at the Default Rate.

ARTICLE V.

REPRESENTATIONS AND WARRANTIES

Section 5.1             

Representations and Warranties of the Loan Parties

.  Each Loan Party
hereby represents and warrants to the Agents and the Lenders, as to itself, as
of the date hereof, and except for representations and warranties that are limited
to a certain date, as of the date of each Advance and as of each Settlement
Date that:

9

(a)               

Existence and Power

.  Such Loan
Party is duly organized, validly existing and in good standing under the laws
of its state of organization.  Such Loan
Party is duly qualified to do business and is in good standing as a foreign
entity, and has and holds all organizational power and all governmental
licenses, authorizations, consents and approvals required to carry on its
business in each jurisdiction in which its business is conducted except where
the failure to so qualify or so hold is not reasonably likely to have a
Material Adverse Effect.

(b)              

Power and Authority; Due Authorization, Execution
and Delivery

.  The execution
and delivery by such Loan Party of this Agreement and each other Transaction
Document to which it is a party, and the performance of its obligations
hereunder and thereunder and, in the case of Borrower, Borrower's use of the
proceeds of Advances made hereunder, are within its corporate powers and authority
and have been duly authorized by all necessary corporate action on its
part.  This Agreement and each other
Transaction Document to which such Loan Party is a party has been duly executed
and delivered by such Loan Party.

(c)               

No Conflict

.  The execution
and delivery by such Loan Party of this Agreement and each other Transaction
Document to which it is a party, and the performance of its obligations
hereunder and thereunder do not contravene or violate (i) its certificate or
articles of incorporation or by-laws, (ii) any law, rule or regulation
applicable to it, (iii) any restrictions under any agreement, contract or
instrument to which it is a party or by which it or any of its property is
bound, or (iv) any order, writ, judgment, award, injunction or decree
applicable to it, and do not result in the creation or imposition of any
Adverse Claim on assets of such Loan Party or its Subsidiaries (except as
created hereunder), except, in any case, where such contravention or violation
is not reasonably likely to have a Material Adverse Effect; and no transaction
contemplated hereby requires compliance with any bulk sales act or similar law.

(d)              

Governmental Authorization

.  Other than
the filing of the financing statements required hereunder, no authorization or
approval or other action by, and no notice to or filing with, any governmental
authority or regulatory body is required for the due execution and delivery by
such Loan Party of this Agreement and each other Transaction Document to which
it is a party and the performance of its obligations hereunder and thereunder.

(e)               

Actions, Suits

.  There are no
actions, suits or proceedings pending, or to the best of such Loan Party's
knowledge, threatened in writing, before any court, arbitrator or other body,
that is reasonably likely to have a Material Adverse Effect, except as set
forth on Schedule 5.1(e) hereto.  Such
Loan Party is not in default with respect to any order of any court, arbitrator
or governmental body which is reasonably likely to have a Material Adverse
Effect.

(f)                

Binding Effect

.  This Agreement
and each other Transaction Document to which such Loan Party is a party
constitute the legal, valid and binding obligations of such Loan Party
enforceable against such Loan Party in accordance with their respective terms,
except as such enforcement may be limited by applicable bankruptcy, insolvency,
reorganization or other similar laws relating to or limiting creditors' rights
generally and by general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law).

10

(g)               

Accuracy of Information

.  All written
information heretofore furnished by such Loan Party or any of its Affiliates to
the Agents or the Lenders for purposes of or in connection with this Agreement,
any of the other Transaction Documents or any transaction contemplated hereby
or thereby is, and all such information hereafter furnished by such Loan Party
or any of its Affiliates to the Agents or the Lenders, as of the date thereof
does not and will not contain any material misstatement of fact or omit to
state a material fact necessary to make the statements contained therein, in
light of the circumstances under which they were made, not misleading.

(h)               

Use of Proceeds

.  No proceeds of
any Advance hereunder will be used for a purpose that violates, or would be
inconsistent with, (i) Section 7.2(e) of this Agreement or (ii) Regulation T, U
or X promulgated by the Board of Governors of the Federal Reserve System from
time to time.

(i)                 

Good Title

.  Borrower is the
legal and beneficial owner of the Receivables and Related Security with respect
thereto, free and clear of any Adverse Claim, except as created hereby.  There have been duly filed all financing
statements or other similar instruments or documents necessary under the UCC of
all appropriate jurisdictions to perfect Borrower's ownership interest in each
Receivable and the Related Security to the extent such interest can be
perfected by filing a financing statement under the UCC.

(j)                

Perfection

.  This Agreement
is effective to create a valid security interest in favor of the Administrative
Agent for the benefit of the Secured Parties in the Collateral to secure
payment of the Obligations, free and clear of any Adverse Claim except as
created by the Transactions Documents. 
There have been duly filed all financing statements or other similar
instruments or documents necessary under the UCC of all appropriate
jurisdictions to perfect the Administrative Agent's (on behalf of the Secured
Parties) security interest in the Collateral to the extent that a security
interest therein may be perfected by filing a financing statement under the
UCC.

(k)              

Places of Business and Locations of Collection
Records

.  The principal
places of business and chief executive office of such Loan Party and the offices
where it keeps all of its Collection Records are located at the address(es)
listed on Exhibit III or such other locations of which the Administrative Agent
has been notified in accordance with Section 7.2(a) in jurisdictions where all
action required by Section 14.4(a) has been taken and completed.  Borrower's Federal Employer Identification
Number is correctly set forth on Exhibit III.

(l)                 

Collections

.  The conditions
and requirements set forth in Section 7.1(j) have at all times since the
effective date of this Agreement been satisfied and duly performed.  The names and addresses of all Collection
Banks, together with the account numbers of the Collection Accounts of Borrower
at each Collection Bank and the post office box number of each Lock-Box, are listed
on Exhibit IV.  Borrower has not granted
any Person, other than the Administrative Agent or the TPFC Agent as
contemplated by and subject to this Agreement, dominion and control of any
Lock-Box or Collection Account, or the right to take dominion and control of
any such Lock-Box or Collection Account at a future time or upon the occurrence
of a future event;  provided, however, that
nothing herein shall be deemed to preclude Borrower from granting Servicer
access to the Lock-Boxes and Collection Accounts for purposes consistent with
the terms of the Servicing Agreement and this Agreement prior to delivery of
the Collection Notices and the appointment of a successor Servicer.

11

(m)             

Material Adverse Effect

.  The initial
Servicer and the Borrower represent and warrant that since December 31, 2002,
no event has occurred that would have a Material Adverse Effect.

(n)               

Names

.  In the past five
(5) years ended on the date of this Agreement, Borrower has not used any
corporate names, trade names or assumed names other than the name in which it
has executed this Agreement other than with respect to DT/Mohawk Funding, LLC
which was merged into the Borrower on or prior to the date hereof.

(o)              

Not a Holding Company or an Investment Company

.  Such Loan Party is not a "holding company" or a "subsidiary
holding company" of a "holding company" within the meaning of the Public
Utility Holding Company Act of 1935, as amended, or any successor statute.  Such Loan Party is not an "investment company"
within the meaning of the Investment Company Act of 1940, as amended, or any
successor statute.

(p)              

Compliance with Law

.  Each Receivable,
together with the Invoice related thereto, does not violate any laws, rules or
regulations applicable thereto (including, without limitation, laws, rules and
regulations relating to truth in lending, fair credit billing, fair credit
reporting, equal credit opportunity, fair debt collection practices and
privacy), except where such violation is not reasonably likely to have a
Material Adverse Effect.

(q)              

Compliance with Credit and Collection Policy

.  Such Loan Party
has complied in all material respects with the Credit and Collection Policy
with regard to each Receivable and the related Contract, and since the Initial
Cutoff Date has not made or consented to any material change to such Credit and
Collection Policy, except such material change as to which the Administrative
Agent has been notified and, if required under Section 7.1(b)(iii), granted its
prior written consent.

(r)                

Payments to Applicable Originator

.  With respect to
each Receivable transferred to Borrower under the Receivables Sale Agreement,
Borrower has given reasonably equivalent value to the applicable Originator in
consideration therefor and such transfer was not made for or on account of an
antecedent debt.

(s)               

Enforceability of Receivables

.  Each Receivable
represents a legal, valid and binding obligation of the related Obligor to pay
the Outstanding Balance of thereof and any accrued interest thereon,
enforceable against the Obligor in accordance with its terms, except as such
enforcement may be limited by applicable bankruptcy, insolvency, reorganization
or other similar laws relating to or limiting creditors' rights generally and
by general principles of equity (regardless of whether enforcement is sought in
a proceeding in equity or at law).

12

(t)                

Eligible Receivables

.  Each
Receivable included in the Net Pool Balance as an Eligible Receivable on the
date of any Monthly Report was an Eligible Receivable on such date.

(u)               

Borrowing Limit

.  Immediately
after giving effect to each Advance and each settlement on any Settlement Date
hereunder, the Aggregate Principal is less than or equal to the Borrowing Limit
and each Group's Percentage of the Aggregate Principal is less than or equal to
such Group's Conduit Allocation Limit.

(v)               

Accounting

.  The manner in
which Borrower accounts for the transactions contemplated by this Agreement and
the Receivables Sale Agreement does not jeopardize the true sale analysis with
respect to transfers between the Originators and Borrower pursuant to the
Receivables Sale Agreement.

Section 5.2             

Liquidity Bank Representations and Warranties

.  Each Liquidity
Bank hereby represents and warrants to the Agents, the Conduits and the Loan
Parties that:

(a)               

Existence and Power

.  Such Liquidity
Bank is a banking association duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization, and has all
organizational power to perform its obligations hereunder and under the
applicable Liquidity Agreement.

(b)              

No Conflict

.  The execution
and delivery by such Liquidity Bank of this Agreement and the applicable
Liquidity Agreement and the performance of its obligations hereunder and
thereunder are within its corporate powers, have been duly authorized by all
necessary corporate action, do not contravene or violate (i) its certificate or
articles of incorporation or association or by-laws, (ii) any law, rule or
regulation applicable to it, (iii) any restrictions under any agreement,
contract or instrument to which it is a party or any of its property is bound,
or (iv) any order, writ, judgment, award, injunction or decree binding on or
affecting it or its property, and do not result in the creation or imposition
of any Adverse Claim on its assets other than pursuant to the Transaction
Documents.   

(c)               

Governmental Authorization

.  No authorization
or approval or other action by, and no notice to or filing with, any
governmental authority or regulatory body is required for the due execution and
delivery by such Liquidity Bank of this Agreement or the applicable Liquidity
Agreement and the performance of its obligations hereunder or thereunder.

(d)              

Binding Effect

.  Each of this
Agreement and the applicable Liquidity Agreement constitutes the legal, valid
and binding obligation of such Liquidity Bank enforceable against such
Liquidity Bank in accordance with its terms, except as such enforcement may be
limited by applicable bankruptcy, insolvency, reorganization or other similar
laws relating to or limiting creditors' rights generally and by general
principles of equity (regardless of whether such enforcement is sought in a
proceeding in equity or at law).  This
Agreement and the applicable Liquidity Agreement have been duly authorized,
executed and delivered by such Liquidity Bank, and is and will remain part of
the permanent records of each Liquidity Bank.

13

ARTICLE VI.

CONDITIONS OF ADVANCES

Section 6.1             

Conditions Precedent to Initial Advance

.  The initial
Advance under this Agreement is subject to the conditions precedent that (a)
the Administrative Agent shall have received on or before the date of such
Advance those documents listed on Schedule A to the Receivables Sale Agreement
and those documents listed on Schedule B to this Agreement, (b) the Rating
Agency Condition shall have been satisfied, and (c) the Administrative Agent
shall have received all fees and expenses required to be paid on such date
pursuant to the terms of this Agreement and the Fee Letter.

Section 6.2             

Conditions Precedent to All Advances

.  Each Advance and
each rollover or continuation of any Advance shall be subject to the further
conditions precedent that (a) the Servicer shall have delivered to the
Co-Agents on or prior to the date thereof all Monthly Reports as and when due
under Section 8.5; (b) the Facility Termination Date shall not have occurred; (c)
in the event of a change in law that affects the validity, perfection or
priority of the Administrative Agent's security interest in the Collateral or a
change in circumstances that materially and adversely affects the Receivables
after the date of this Agreement, the Administrative Agent shall have received
such other opinions or documents as it may reasonably request; and (d) on the
date thereof, the following statements shall be true (and acceptance of the
proceeds of such Advance shall be deemed a representation and warranty by
Borrower that such statements are then true):

(i) the representations and warranties set forth in
Section 5.1 are true and correct on and as of the date of such Advance (or such
Settlement Date, as the case may be) as though made on and as of such date;

(ii) no event has occurred and is continuing, or
would result from such Advance (or the continuation thereof), that will
constitute an Amortization Event, and no event has occurred and is continuing,
or would result from such Advance (or the continuation thereof), that would
constitute an Unmatured Amortization Event; and

(iii) after giving effect to such Advance (or the
continuation thereof), the Aggregate Principal will not exceed the Borrowing
Limit.

ARTICLE VII.

COVENANTS

Section 7.1             

Affirmative Covenants of the Loan Parties

.  Until the Final
Payout Date, each Loan Party hereby covenants, as to itself, as set forth
below:

14

(a)               

Financial Reporting

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

(i)                 

Annual Reporting

.  Promptly
upon the filing thereof with the Securities Exchange Commission, if applicable,
and, in any event, within 90 days after the close of each of its respective
fiscal years:  (A) audited, unqualified
consolidated financial statements (which shall include balance sheets,
statements of earnings, stockholder's equity, and cash flows) of the
Performance Guarantor for such fiscal year, accompanied by an opinion of
independent public accountants of recognized national standing, and (B)
analogous unaudited balance sheets and statements of earnings for Borrower,
certified by one of its Responsible Financial Officers.

(ii)               

Quarterly Reporting

.  Promptly
upon the filing thereof with the Securities Exchange Commission, if applicable,
and, in any event, within 45 days after the close of the first three (3)
quarterly periods of each of Performance Guarantor's fiscal years consolidated
balance sheets of the Performance Guarantor as at the close of each such period
and consolidated statements of earnings, stockholder's equity and cash flows
for the Performance Guarantor for the period from the beginning of such fiscal
year to the end of such quarter, all certified by one of its Responsible
Financial Officers.  Within 90 days
after the close of the first three (3) quarterly periods of each of Borrower's
fiscal years balance sheets of Borrower as at the close of each such period and
statements of earnings for Borrower for the period from the beginning of such
fiscal year to the end of such quarter, all certified by one of its Responsible
Financial Officers.

(iii)              

Compliance Certificate

.  Together
with the financial statements required hereunder, a compliance certificate in
substantially the form of Exhibit V signed by one of Borrower's Responsible
Financial Officers and dated the date of such annual financial statement or
such quarterly financial statement, as the case may be.

(iv)             

Shareholders Statements and Reports

.  Promptly
upon the furnishing thereof generally to the shareholders of Performance
Guarantor copies of all financial statements, reports and proxy statements so
furnished.

(v)               

S.E.C. Filings

.  Promptly upon
the filing thereof, copies of all registration statements (other than
registration statements on Forms S-8 or S-3 covering benefit or compensation
plans, stock purchase or dividend reinvestment plans, or for purposes of
resales of securities by holders) and annual, quarterly, monthly or other regular
reports which any Loan Party or any of its Affiliates files with the Securities
and Exchange Commission.

(vi)             

Other Information

.  Promptly,
from time to time, such other information, documents, records or reports
relating to the Receivables or the condition or results of operations of such
Loan Party as the Administrative Agent may from time to time reasonably request
in order to protect the interests of the Agents and the Lenders under or as
contemplated by this Agreement.

15

(b)              

Notices

.  Such Loan Party
will notify the Administrative Agent in writing of any of the following within
one (1) business day of learning of the occurrence thereof, describing the same
and, if applicable, the steps being taken with respect thereto:

(i)                 

Amortization Events or Unmatured Amortization Events

.  The
occurrence of each Amortization Event and each Unmatured Amortization Event, by
a statement of a Responsible Financial Officer of such Loan Party.

(ii)               

Copies of Notices

.  Promptly
upon its receipt of any notice, request for consent, financial statements,
certification, report or other material communication under or in connection
with any other Transaction Document from any Person other than any Agent or any
Lender, a copy of the same.

(iii)              

Change in Credit and Collection Policy

.  At least thirty
(30) days prior to the effectiveness of any material change in or material
amendment to the Credit and Collection Policy, a copy of the Credit and
Collection Policy then in effect and a notice (A) indicating such proposed
change or amendment, and (B) requesting the Administrative Agent's consent
thereto if such proposed change or amendment is reasonably likely to adversely
affect the collectibility of the Receivables generally or materially decrease
the credit quality of newly created Receivables generally.

(iv)             

Termination Date

.  The
occurrence of the "Termination Date" under and as defined in the Receivables Sale
Agreement.

(v)               

Defaults Under Other Agreements

.  The
occurrence of a default or an event of default under any other financing
arrangement pursuant to which such Loan Party is a debtor or an obligor.

(vi)             

Downgrade of Performance Guarantor

.  Any
downgrade in the rating of any Indebtedness of Performance Guarantor by S&P
or Moody's, setting forth the Indebtedness affected and the nature of such
change.

(vii)            

Material Adverse Effect

.  The
occurrence of any event or condition that has had, or is reasonably likely to
have, a Material Adverse Effect.

(c)               

Compliance with Laws and Preservation of Corporate
Existence

.  Such Loan Party
will comply in all respects with all applicable laws, rules, regulations,
orders, writs, judgments, injunctions, decrees or awards to which it may be
subject, except where the failure to so comply is not reasonably likely to have
a Material Adverse Effect.   Such Loan
Party 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 entity in each jurisdiction where its
business is conducted, except where the failure to so preserve and maintain or
qualify is not reasonably likely to have a Material Adverse Effect.

(d)              

Audits

.  Such Loan Party
will furnish to the Administrative Agent from time to time such information
with respect to it and the Receivables as the Administrative Agent may
reasonably request.  Such Loan Party
will, from time to time during regular business hours as requested by the
Administrative Agent upon not less than two (2) Business Days' prior written
notice (unless an Amortization Event has occurred in which case the
Administrative Agent may have access on demand without notice), permit the
Administrative Agent, or its agents or representatives (and shall cause each
Originator to permit the Administrative Agent or its agents or
representatives):  (i) to examine and
make copies of and abstracts from all Collection Records and Other Records in
the possession or under the control of such Person relating to the Collateral,
including, without limitation, the related Contracts, and (ii) to visit the
offices and properties of such Person for the purpose of examining such
materials described in clause (i) above, and to discuss matters relating to
such Person's financial condition or the Collateral or any Person's performance
under any of the Transaction Documents or any Person's performance under the
Contracts and, in each case, with any of the officers or employees of Borrower
or the Servicer having knowledge of such matters (each of the foregoing
examinations and visits, a "Review"); provided, however, that,
so long as no Amortization Event has occurred and is continuing, (A) the Loan
Parties shall only be responsible for the out-of-pocket costs and expenses of
one (1) Review in any one calendar year, and (B) the Administrative Agent will
not request more than one (1) Review in any period of three consecutive
calendar months.  So long as no
Amortization Event has occurred and is continuing, the Administrative Agent
shall provide to the Loan Parties a written estimate of the costs and expenses
of each Review for which the Loan Parties are responsible to pay not less than
two (2) Business Days prior to the commencement of any such Review.

16

(e)               
Keeping and Marking of Records and Books.

(i) The Servicer will maintain and implement
administrative and operating procedures (including, without limitation, an
ability to recreate records evidencing Receivables in the event of the
destruction of the originals thereof), and keep and maintain all documents,
books, records and other information reasonably necessary or advisable for the
collection of all Receivables (including, without limitation, records adequate
to permit the identification of each new Receivable and all Collections of and
adjustments to each existing Receivable). 
The Servicer will (and will cause each Originator to) give the Agents
notice of any material change in the administrative and operating procedures
referred to in the previous sentence.

(ii) Borrower will: 
(A) on or prior to the date hereof, make appropriate notation in its
computer files and other books and records relating to the Loans with a
notation, reasonably acceptable to the Agents, describing the Administrative
Agent's security interest in the Collateral and (B) upon the request of the any
of the Agents following the occurrence of an Amortization Event:  (x) mark each Contract with a legend or code
describing the Administrative Agent's security interest relating to the
Receivables.

(f)                

Compliance with Credit and Collection Policy

.  Such Loan Party
will comply in all respects with the Credit and Collection Policy in regard to
each Receivable and the related Contract.

(g)               

Performance and Enforcement of Receivables Sale
Agreement

.  Borrower will
perform each of its obligations and undertakings under and pursuant to the
Receivables Sale Agreement, will purchase Receivables thereunder in compliance
with the terms thereof, and will diligently enforce each Originator's
obligations under the Receivables Sale Agreement.  Borrower will take all actions to perfect and enforce its rights
and interests (and the rights and interests of the Agents and the Lenders as
assignees of Borrower) under the Receivables Sale Agreement as any of the
Agents may from time to time reasonably request, including, without limitation,
making claims to which it may be entitled under any indemnity, reimbursement or
similar provision contained in the Receivables Sale Agreement.

17

(h)               

Ownership

.  Borrower will
(or will cause each Originator to) (i) take all necessary action to establish
and maintain, irrevocably, in Borrower all right, title and interest in and to
Receivables purchased under the Receivables Sale Agreement together with the
associated Related Security, in each case, free and clear of any Adverse Claims
(other than Adverse Claims in favor of the Administrative Agent, for the
benefit of the Secured Parties) including, without limitation, the filing of
all financing statements or other similar instruments or documents necessary
under the UCC of all appropriate jurisdictions to perfect Borrower's interest
in such Receivables and the Related Security (to the extent such ownership
interest therein can be perfected by filing UCC financing statements) and such
other action to perfect, protect or more fully evidence the interest of
Borrower therein as any of the Agents may reasonably request), and (ii)
establish and maintain, in favor of the Administrative Agent, for the benefit
of the Secured Parties, a valid and perfected first priority security interest
in all Collateral, free and clear of any Adverse Claims, including, without
limitation, the filing of all financing statements or other similar instruments
or documents necessary under the UCC of all appropriate jurisdictions to
perfect the Administrative Agent's (for the benefit of the Secured Parties)
security interest in the Collateral and such other action to perfect, protect
or more fully evidence the interest of the Administrative Agent for the benefit
of the Secured Parties as any Agent may reasonably request, all to the extent
such ownership can be perfected by filing UCC financing statements.

(i)                 

Lenders' Reliance

.  Borrower
acknowledges that the Agents and the Lenders are relying upon Borrower's
identity as a legal entity that is separate from each Originator and its other
Affiliates and agrees to take all reasonable steps to maintain Borrower's
identity as a separate legal entity and to make it manifest to third parties
that Borrower is an entity with assets and liabilities distinct from those of
each Originator and its other Affiliates (other than Borrower) and not just a
division thereof.  Without limiting the
generality of the foregoing and in addition to the other covenants set forth
herein, (i) Borrower will conduct its affairs in strict compliance with
Sections 7.06 and 7.07 of its Amended and Restated Certificate of Incorporation
as in effect on the date hereof and as hereafter amended with the consent of
the Administrative Agent (which consent shall not be unreasonably withheld or
delayed), and (ii) Borrower will maintain at all times Net Worth greater than
or equal to the Required Capital Amount and refrain from making any dividend,
distribution, redemption of capital stock or payment of any subordinated
indebtedness which would cause Net Worth to be less than the Required Capital
Amount.

(j)                

Collections

.  Borrower will
cause (1) all proceeds from all Lock-Boxes to be directly deposited by a
Collection Bank into a Collection Account and (2) each Lock-Box and Collection
Account to be subject at all times, to a Collection Account Agreement that is
in full force and effect.  If any new
Lock-Boxes or Collection Accounts are established after the date of this
Agreement, in addition to compliance with the foregoing clause (2), Borrower
will promptly provide the Administrative Agent with copies of an updated
Exhibit IV to this Agreement and an updated Exhibit III to the Receivables Sale
Agreement (and upon such delivery both such Exhibits shall be deemed to be
amended accordingly notwithstanding anything in Section 14.1 hereof or Section
7.1 of the Receivables Sale Agreement to the contrary).  In the event any payments relating to the
Collateral are remitted directly to any Loan Party or any Affiliate of such
Loan Party, such Loan Party will remit (or will cause all such payments to be
remitted) directly to a Collection Bank and deposited into a Collection Account
within two (2) Business Days following receipt thereof, and, at all times prior
to such remittance, such Loan Party will itself hold or, if applicable, will
cause such payments to be held in trust for the exclusive benefit of the Agents
and the Lenders.  Borrower will maintain
exclusive ownership, dominion and control (subject to the terms of this
Agreement) of each Lock-Box and Collection Account and shall not grant the
right to take dominion and control of any Lock-Box or Collection Account at a
future time or upon the occurrence of a future event to any Person, except to
the Administrative Agent or the TPFC Agent as contemplated by this Agreement; provided,
however, that nothing herein shall be deemed to preclude Borrower from
granting Servicer access to the Lock-Boxes and Collection Accounts for purposes
consistent with the terms of the Servicing Agreement and this Agreement prior
to delivery of the Collection Notices.

18

(k)              

Taxes

.  To the extent
that such Loan Party's tax returns are not lawfully consolidated with the
returns of another Person, such Loan Party will file all tax returns and
reports required by law to be filed by it and will promptly pay all taxes and
governmental charges at any time owing, except any such taxes which are not yet
delinquent or are being diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance with GAAP shall have
been set aside on its books.  Borrower
will pay when due any taxes payable by it in connection with the Receivables,
exclusive of taxes on or measured by income or gross receipts of any Agent or
any Lender.

(l)                 

Payment to Applicable Originator

.  With respect to
any Receivable purchased by Borrower from any Originator, such sale shall be
effected under, and in accordance with the terms of, the Receivables Sale
Agreement, including, without limitation, the terms relating to the amount and
timing of payments to be made to such Originator in respect of the purchase
price for such Receivable.

Section 7.2             

Negative Covenants of the Loan Parties

.  Until the
Final Payout Date, each Loan Party hereby covenants, as to itself, that:

(a)               

Name Change, Jurisdiction of Organization, Offices
and Collection Records

.  Each of Borrower
and Servicer will not and will not authorize any Originator to, change its name
or jurisdiction of organization or relocate any office where Collection Records
are kept unless it shall have:  (i)
given the Agents at least thirty (30) days' prior written notice thereof and
(ii) delivered to the Administrative Agent all financing statements,
instruments and other documents requested by any Agent in connection with such
change or relocation.

(b)              

Change in Payment Instructions to Obligors

.  Except as may be
required by the Administrative Agent pursuant to Section 8.2(b), such Loan
Party will not, and will not authorize any Originator to, add or terminate any
bank as a Collection Bank, or make any change in the instructions to Obligors
regarding payments to be made to any Lock-Box or Collection Account, unless the
Agents shall have received, at least ten (10) days before the proposed
effective date therefor, (i) written notice of such addition, termination or
change, and (ii) a Collection Account Agreement with respect to any new
Lock-Box or Collection Account; provided, however, that the Servicer
may make changes in instructions to Obligors regarding payments if such new
instructions require such Obligor to make payments to another existing
Collection Account that complies with this clause (ii).

19

(c)               

Modifications to Contracts and Credit and Collection
Policy

.  Such Loan Party
will not, and will not cause or authorize any Originator to, make any change to
the Credit and Collection Policy that is reasonably likely to materially
adversely affect the collectibility of the Receivables generally or materially
decrease the credit quality of newly created Receivables generally.  The Servicer will not, and will not permit
any Originator to, extend, amend or otherwise modify the terms of any Receivable
or any Contract related thereto other than in accordance with the Credit and
Collection Policy.

(d)              

Sales, Liens

.  Borrower will
not sell, assign (by operation of law or otherwise) or otherwise dispose of, or
grant any option with respect to, or create or suffer to exist any Adverse
Claim upon (including, without limitation, the filing of any financing
statement) or with respect to, its interest in any of the Collateral, or assign
any right to receive income with respect thereto (other than, in each case, the
creation of a security interest therein in favor of the Administrative Agent as
provided for herein), and Borrower will defend the right, title and interest of
the Secured Parties in, to and under any of the foregoing property, against all
claims of third parties claiming through or under Borrower or any Originator.

(e)               

Use of Proceeds

.  Borrower will
not use the proceeds of the Advances for any purpose other than (i) paying for
Receivables and Related Security under and in accordance with the Receivables
Sale Agreement, (ii) making loans to Mohawk Resources or Mohawk Carpet at any
time so long as no Amortization Event or Unmatured Amortization Event exists
and is continuing, (iii) paying its ordinary and necessary operating expenses
when and as due, and (iv) making Restricted Junior Payments to the extent
permitted under this Agreement.

(f)                

Termination Date Determination

.  Borrower will
not designate the Termination Date (as defined in the Receivables Sale
Agreement), or send any written notice to any Originator in respect thereof
prior to the Final Payout Date, without the prior written consent of the
Agents, except with respect to the occurrence of such Termination Date arising
pursuant to Section 5.1(d) of the Receivables Sale Agreement.

(g)               

Restricted Junior Payments

.  Borrower will
not make any Restricted Junior Payment if after giving effect thereto,
Borrower's Net Worth would be less than the Required Capital Amount.

(h)               

Borrower Indebtedness

.  Borrower will
not incur or permit to exist any Indebtedness or liability on account of
deposits except:  (i) the Obligations,
and (ii) other current accounts payable arising in the ordinary course of
business.

20

ARTICLE VIII.

ADMINISTRATION AND COLLECTION

Section
8.1             
Designation of Servicer.

(a)               
The servicing, administration and collection of the
Receivables shall be conducted by such Person (the "Servicer") so designated
from time to time in accordance with this Section 8.1.  Mohawk Servicing is hereby designated as,
and shall have the rights and agrees to perform the duties and obligations of,
the initial Servicer pursuant to the terms of the Servicing Agreement, subject
to the provisions of this Agreement. 
The Borrower may, at any time upon thirty (30) days prior written notice
to the Agents, designate any other direct or indirect Subsidiary of the
Performance Guarantor as a successor Servicer, provided the Rating Agency
Condition is satisfied.  The Co-Agents
may at any time following the occurrence of an Amortization Event designate as
Servicer any Person to succeed Mohawk Servicing or any successor Servicer provided
that the Rating Agency Condition is satisfied.   
To the extent that the Servicer's
obligations under this Agreement are inconsistent with its obligations under
the Servicing Agreement, the terms of this Agreement shall govern and control.

(b)              
Mohawk Servicing may delegate, and Mohawk Servicing hereby
advises the Lenders and the Agents that it has delegated, to the Originators,
as sub-servicers of the Servicer and to the Performance Guarantor, certain of
its duties and responsibilities as Servicer hereunder in respect of the Receivables
originated by such Originator.  Without
the prior written consent of the Agents and the Required Liquidity Banks,
Mohawk Servicing shall not be permitted to delegate any of its duties or
responsibilities as Servicer to any Person other than (i) Borrower, (ii) the
Originators, (iii) the Performance Guarantor, and (iv) with respect to certain
Defaulted Receivables, outside collection agencies in accordance with its
customary practices.  Neither Borrower
nor any Originator shall be permitted to further delegate to any other Person
any of the duties or responsibilities of the Servicer delegated to it by Mohawk
Servicing.  If at any time the Co-Agents
shall designate as Servicer any Person other than Mohawk Servicing, all duties
and responsibilities theretofore delegated by Mohawk Servicing to Borrower or
the Originators may, at the discretion of the Co-Agents, be terminated
forthwith on notice given by the Co-Agents to Mohawk Servicing and to Borrower
and the Originators.

(c)               
Notwithstanding the foregoing subsection (b):  Mohawk Servicing shall be and remain
primarily liable for the full and prompt performance of all duties and
responsibilities of the Servicer pursuant to the Servicing Agreement and this
Agreement.  Mohawk Servicing, at all
times that it is the Servicer, shall be responsible for providing any
sub-servicer or other delegate of the Servicer with any notice given to the
Servicer under this Agreement.

Section 8.2             
Certain Duties of Servicer.

(a)               
[intentionally deleted].

(b)              
From and after the date the Administrative Agent delivers to
any Collection Bank a Collection Notice pursuant to Section 8.3, any Agent may
request that the Servicer, and the Servicer thereupon promptly shall instruct
all Obligors with respect to the Receivables, to remit all payments thereon to
a new depositary account specified by the Administrative Agent and, at all
times thereafter, Borrower and the Servicer shall not deposit or otherwise
credit, and shall not permit any other Person to deposit or otherwise credit to
such new depositary account any cash or payment item other than Collections.

21

(c)               
The Servicer shall administer the Collections in accordance
with the procedures described herein and in Article II.  The Servicer shall set aside and hold in
trust for the account of Borrower and the Lenders their respective shares of
the Collections in accordance with Article II. 
The Servicer shall, upon the request of any Agent, segregate, in a
manner acceptable to the Agents, all cash, checks and other instruments received
by it from time to time constituting Collections from the general funds of the
Servicer or Borrower prior to the remittance thereof in accordance with Article
II.  If the Servicer shall be required
to segregate Collections pursuant to the preceding sentence, the Servicer shall
segregate and deposit with a bank designated by the Administrative Agent such
allocable share of Collections of Receivables set aside for the Lenders on the
first Business Day following receipt by the Servicer of such Collections, duly
endorsed or with duly executed instruments of transfer.

(d)              
The Servicer may, in accordance with the Credit and Collection
Policy, extend the maturity of any Receivable or adjust the Outstanding Balance
of any Receivable as the Servicer determines to be appropriate to maximize
Collections thereof; provided, however, that such
extension or adjustment shall not alter the status of such Receivable as a
Delinquent Receivable or Defaulted Receivable or limit the rights of the Agents
or the Lenders under this Agreement except to the extent payment is received
thereon from the Originator pursuant to the Receivables Sale Agreement.

(e)               
If demanded by the Administrative Agent following an
Amortization Event, the Servicer shall deliver or make available to the
Administrative Agent all such Collection Records or duplicates thereof, at a
place selected by the Administrative Agent, provided that such Collection
Records will be available for use by the Borrower, the Performance Guarantor
and their Affiliates for reasonable use in their respective businesses.  The Servicer shall, as soon as practicable
following receipt thereof, turn over to Borrower any cash collections or other
cash proceeds received not constituting Receivables.  The Servicer shall, from time to time at the request of any
Lender, furnish to the Lenders (promptly after any such request) a calculation
of the amounts set aside for the Lenders pursuant to Article II.

(f)                
Any payment by an Obligor in respect of any indebtedness owed
by it to Originator or Borrower shall, except as otherwise specified by such
Obligor or otherwise required by contract or law and unless otherwise
instructed by the Co-Agent, be applied as a Collection of any Receivable of
such Obligor (starting with the oldest such Receivable) to the extent of any
amounts then due and payable thereunder before being applied to any other
receivable or other obligation of such Obligor.

Section 8.3             

Collection Notices

.  The
Administrative Agent and, if applicable, the TPFC Agent are each authorized at
any time after the occurrence of an Amortization Event to date and to deliver
to the Collection Banks the Collection Notices.  Borrower hereby transfers to the Administrative Agent and, if
applicable, the TPFC Agent for the benefit of the Agents and the Lenders,
effective when the Administrative Agent or, if applicable, the TPFC Agent
delivers such Collection Notices, the exclusive ownership and control of each
Lock-Box and the Collection Accounts. 
In case any authorized signatory of Borrower whose signature appears on
a Collection Account Agreement shall cease to have such authority before the
delivery of such notice, such Collection Notice shall nevertheless be valid as
if such authority had remained in force. 
Borrower hereby authorizes the Administrative Agent, and agrees that the
Administrative Agent shall be entitled (i) at any time after delivery of the
Collection Notices, to endorse Borrower's name on checks and other instruments
representing Collections, (ii) at any time after the occurrence of an
Amortization Event, to enforce the Receivables and the Related Security, and
(iii) at any time after the occurrence of an Amortization Event, to take such
action as shall be necessary or desirable to cause all cash, checks and other
instruments constituting Collections of Receivables to come into the possession
of the Administrative Agent rather than Borrower and applied against the
Obligations.

22

Section 8.4             

Responsibilities of Borrower

.  Anything herein
to the contrary notwithstanding, the exercise by the Administrative Agent on
behalf of the Co-Agents and the Lenders of their rights hereunder shall not
release the Servicer, any Originator or Borrower from any of their duties or
obligations with respect to any Receivables or under the related
Contracts.  Neither the Agents nor the
Lenders shall have any obligation with respect to any Receivable or related
Contracts to perform the obligations of Borrower that give rise to such
Receivable.

Section 8.5             

Monthly Reports

.  The Servicer
shall prepare and forward, or cause to be prepared and forwarded, to the
Administrative Agent (i) on each Monthly Reporting Date, a Monthly Report and
an electronic file of the data contained therein and (ii) at such times as the
Co-Agents shall request, a listing by Obligor of all Receivables together with
an aging of such Receivables; provided, however, that the Co-Agents
may, in the exercise of their reasonable credit judgment, request that the
Servicer prepare and forward a report similar to the Monthly Report more
frequently than set forth above.

Section 8.6             

Servicing Fee

.  As compensation for the Servicer's servicing activities on their
behalf, the Lenders hereby agree to pay the Servicer the Servicing Fee, which
fee shall be paid in arrears on each Settlement Date.  The Servicing Fee specified in this Section 8.6 shall be in lieu
of the fee payable to Mohawk Servicing pursuant to the Servicing Agreement.

ARTICLE IX.

AMORTIZATION EVENTS

Section 9.1             

Amortization Events

.  The occurrence
of any one or more of the following events shall constitute an Amortization
Event:

(a)               
Performance Guarantor or any Loan Party shall fail to make any
payment or deposit required to be made by it under this Agreement or the
Performance Undertaking when due and, for any such payment or deposit which is
not in respect of principal, such failure continues for three (3) consecutive
Business Days.

(b)              
Any representation, warranty, certification or written
statement made by Performance Guarantor or any Loan Party in any Transaction
Document to which it is a party or in any other document delivered pursuant
thereto shall prove to have been materially incorrect when made or deemed made;
provided
that the materiality threshold in the preceding clause shall not be
applicable with respect to any representation or warranty which itself contains
a materiality threshold.

23

(c)               
Any Loan Party shall fail to perform or observe any covenant
contained in Section 7.2 or 8.5 when due, or any covenant contained in Section
7.1(b) (other than Section 7.1(b)(vi)) within three (3) Business Days after the
same is due.

(d)              
Performance Guarantor, Borrower or Servicer shall fail to
perform or observe any other covenant or agreement applicable to it under any
Transaction Document to which it is party and such failure shall continue for
thirty (30) consecutive days after notice of non-performance from any of the
Agents.

(e)               
Failure of Borrower to pay any Indebtedness (other than the
Obligations) when due (taking into account any grace or cure period) or the
default by Borrower in the performance of any term, provision or condition
contained in any agreement under which any such Indebtedness was created or is
governed, the effect of which is to permit the holder or holders of such
Indebtedness to cause such Indebtedness to become due prior to its stated
maturity or results in the acceleration of such Indebtedness; or any such
Indebtedness of Borrower shall be declared to be due and payable or required to
be prepaid (other than by a regularly scheduled payment) prior to the date of
maturity thereof.

(f)                
Failure of Performance Guarantor or any of its Subsidiaries
other than Borrower to pay Indebtedness in excess of $25,000,000 in aggregate
principal amount (hereinafter, "Material Debt") when due; or the
default by Performance Guarantor or any of its Subsidiaries other than Borrower
in the performance of any term, provision or condition contained in any
agreement under which any Material Debt was created or is governed, the effect
of which is to permit the holder or holders of such Material Debt to cause such
Material Debt to become due prior to its stated maturity or results in the
acceleration of such Material Debt; or any Material Debt of Performance
Guarantor or any of its Subsidiaries other than Borrower shall be declared to
be due and payable or required to be prepaid (other than by a regularly
scheduled payment) prior to the date of maturity thereof.

(g)               
An Event of Bankruptcy shall occur with respect to Performance
Guarantor, any Loan Party or any of their respective Subsidiaries.

(h)               
As at the end of any Calculation Period:

(i)            the three-month rolling average
Delinquency Ratio shall exceed 4.15%,

(ii)            the three-month rolling average Default
Ratio shall exceed 2.80%, or

(iii)            the three-month rolling average
Dilution Ratio shall exceed 8.75%.

24

(i)                 
A Change of Control shall occur.

(j)                
(i) One or more final judgments for the payment of money in an
aggregate amount equal to or in excess of the amount set forth in Section
303(b)(2) of the Federal Bankruptcy Code shall be entered against Borrower and
such judgment shall continue unsatisfied and in effect for thirty (30)
consecutive days without a stay of execution or (ii) one or more final
judgments for the payment of money in an amount in excess of $25,000,000,
individually or in the aggregate, shall be entered against Performance
Guarantor or any of its Subsidiaries (other than Borrower on claims not covered
by insurance or as to which the insurance carrier has denied its
responsibility), and such judgment shall continue unsatisfied and in effect for
thirty (30) consecutive days without a stay of execution.

(k)              
The "Termination Date" under and as
defined in the Receivables Sale Agreement shall occur under the Receivables
Sale Agreement; or without the Administrative Agent's prior written consent,
Borrower shall consent to any assignment by an Originator of its rights or
obligations under the Receivables Sale Agreement other than to any other
Originator or to the surviving entity in a merger or consolidation of an
Originator with any other Person who is or is to become an Originator after
giving effect to such merger or consolidation; or any Originator shall for any
reason cease to transfer, or cease to have the legal capacity to transfer, or
otherwise be incapable of transferring Receivables to Borrower under the
Receivables Sale Agreement.

(l)                 
This Agreement shall terminate in whole or in part (except in
accordance with its terms), or shall cease to be effective or to be the legally
valid, binding and enforceable obligation of either Loan Party, or the
Administrative Agent for the benefit of the Secured Parties shall cease to have
a valid and perfected first priority security interest in the Collateral.

(m)             
On any Settlement Date, after giving effect to the turnover of
Collections by the Servicer on such date and the application thereof to the
Obligations in accordance with this Agreement, the Aggregate Principal shall
exceed the Borrowing Limit after any payment of the Obligations by Borrower.

(n)               
The Performance Undertaking shall cease to be effective or to
be the legally valid, binding and enforceable obligation of Performance
Guarantor, or Performance Guarantor shall directly or indirectly contest in any
manner such effectiveness, validity, binding nature or enforceability of its
obligations thereunder.

(o)              
The PBGC or Internal Revenue Service shall file any notice of
lien on any of the Receivables or the Related Security and such lien shall not
have been released within seven (7) days.

(p)              
[intentionally deleted].  

(q)              
Any event shall occur which has, or is reasonably likely to
have, a Material Adverse Effect.  

Section 9.2             

Remedies

.  Upon the occurrence and during the continuation of an
Amortization Event, the Administrative Agent may, or upon the direction of any
of the Co-Agents or the Required Liquidity Banks shall, take any of the
following actions:  (i) declare the
Amortization Date to have occurred, whereupon the Aggregate Commitment shall
immediately terminate and the Amortization Date shall forthwith occur, all
without demand, protest or further notice of any kind, all of which are hereby
expressly waived by each Loan Party and the Person acting as Servicer may be
replaced by the Co-Agents in their sole discretion; provided, however, that
upon the occurrence of an Event of Bankruptcy with respect to any Loan Party,
the Amortization Date shall automatically occur, without demand, protest or any
notice of any kind, all of which are hereby expressly waived by each Loan
Party, (ii) deliver the Collection Notices to the Collection Banks, (iii)
exercise all rights and remedies of a secured party upon default under the UCC
and other applicable laws, and (iv) notify Obligors of the Administrative
Agent's security interest in the Receivables and other Collateral.  The aforementioned rights and remedies shall
be without limitation, and shall be in addition to all other rights and
remedies of the Agents and the Lenders otherwise available under any other
provision of this Agreement, by operation of law, at equity or otherwise, all
of which are hereby expressly preserved, including, without limitation, all
rights and remedies provided under the UCC, all of which rights shall be
cumulative.

25

ARTICLE X.

INDEMNIFICATION

Section 10.1         

Indemnities by the Loan Parties

.  Without limiting
any other rights that any Agent or any Lender may have hereunder or under
applicable law, (A) Borrower hereby agrees to indemnify (and pay upon demand
to) each Agent, each Conduit, each of the Liquidity Banks and each of their
respective officers, directors, agents and employees of the foregoing (each, an
"Indemnified
Party") from and against any and all damages, losses, claims, taxes,
liabilities, costs, expenses and for all other amounts payable, including
reasonable attorneys' fees and disbursements actually incurred (all of the
foregoing being collectively referred to as "Indemnified Amounts")
awarded against and actually paid or actually incurred by any of them arising
out of or as a result of this Agreement or the acquisition, either directly or
indirectly, by a Lender of an interest in the Receivables, and (B) the Servicer
hereby agrees to indemnify (and pay upon demand to) each Indemnified Party for
Indemnified Amounts awarded against and actually paid or actually incurred by
any of them arising out of the Servicer's activities as Servicer hereunder excluding,
however, in all of the foregoing instances under the preceding clauses
(A) and (B):

(a)               
Indemnified Amounts to the extent a final judgment of a court
of competent jurisdiction holds that such Indemnified Amounts resulted from
gross negligence or willful misconduct on the part of any Indemnified Party;
 

(b)              
Indemnified Amounts to the extent the same includes losses in
respect of Receivables that are uncollectible on account of the insolvency,
bankruptcy or lack of creditworthiness of the related Obligor;  

(c)               
Indemnified Amounts to the extent the same arise out of or
result from claims of one or more Indemnified Parties against another
Indemnified Party, or

26

(d)              
taxes imposed by the jurisdiction in which such Indemnified
Party's principal executive office is located, on or measured by the overall
net income or gross receipts of such Indemnified Party;

provided, however, that nothing
contained in this sentence shall limit the liability of any Loan Party or limit
the recourse of the Lenders to Borrower or Servicer for amounts otherwise
specifically provided to be paid by either such Loan Party under the terms of
this Agreement.  Without limiting the
generality of the foregoing indemnification, Borrower shall indemnify the
Agents and the Lenders for Indemnified Amounts (including, without limitation,
losses in respect of uncollectible receivables, regardless of whether
reimbursement therefor would constitute recourse to Borrower or the Servicer)
relating to or resulting from:

(e)                 
PLEASE
do not delete this hidden level

(i)                 
any representation or warranty made by any Loan Party or any
Originator (or any of their respective officers on behalf of any such Person)
under or in connection with any Transaction Document to which they are parties,
or any other written information or report delivered by any such Person
pursuant hereto or thereto, which shall have been false or incorrect when made
or deemed made;

(ii)               
the failure by Borrower, the Servicer or any Originator to
comply with any applicable law, rule or regulation with respect to any
Receivable or Contract related thereto, or the nonconformity of any Receivable
or Contract included therein with any such applicable law, rule or regulation
or any failure of any Originator to keep or perform any of its obligations,
express or implied, with respect to any Contract;

(iii)              
any failure of Borrower, the Servicer or any Originator to
perform its duties, covenants or other obligations in accordance with the
provisions of this Agreement, the Receivables Sale Agreement or the Servicing
Agreement;

(iv)             
any products liability, personal injury or damage suit, or
other similar claim arising out of or in connection with merchandise, insurance
or services that are the subject of any Contract or any Receivable;

(v)               
any dispute, claim, offset or defense (other than discharge in
bankruptcy of the Obligor) of the Obligor to the payment of any Receivable
(including, without limitation, a defense based on such Receivable or the
related Contract 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 service related to such
Receivable or the furnishing or failure to furnish such merchandise or services;

(vi)             
any Collections received, directly or indirectly by an
Originator (or its agent) which are not promptly remitted to Borrower;

(vii)            
any investigation, litigation or proceeding related to or
arising from this Agreement, the Receivables Sales Agreement or the Servicing
Agreement, the transactions contemplated hereby, the use of the proceeds of any
Advance, the Collateral or any other investigation, litigation or proceeding
relating to Borrower, the Servicer or any Originator in which any Indemnified
Party becomes involved as a result of any of the transactions contemplated
hereby;

27

(viii)          
any inability to litigate any claim against any Obligor in
respect of any Receivable as a result of such Obligor being immune from civil
and commercial law and suit on the grounds of sovereignty or otherwise from any
legal action, suit or proceeding;

(ix)             
any failure of Borrower to acquire and maintain ownership of
any of the Collateral from the applicable Originator, free and clear of any
Adverse Claim (other than as created hereunder);

(x)               
any failure to vest and maintain vested in the Administrative
Agent for the benefit of the Secured Parties a valid first priority perfected
security interests in the Collateral, free and clear of any Adverse Claim
(except as created by the Transaction Documents);

(xi)             
the failure to have filed or to have maintained effective
financing statements or other similar instruments or documents under the UCC of
any applicable jurisdiction or other applicable domestic or foreign laws with
respect to any Collateral, and the proceeds thereof, whether at the time of any
Advance or at any subsequent time;

(xii)            
the failure of any Receivable included in the calculation of
the Net Pool Balance as an Eligible Receivable to be an Eligible Receivable at
the time so included.

Section 10.2         

Increased Cost and Reduced Return

.  If any Funding
Source shall be charged any fee, expense or increased cost on account of a "Regulatory
Change":  (i) that subjects any
Funding Source to any tax, duty or other charge on or with respect to any
Funding Agreement or a Funding Source's obligations under a Funding Agreement,
or on or with respect to the Receivables, or changes the basis of taxation of
payments to any Funding Source of any amounts payable under any Funding
Agreement (except for changes in the rate of tax on the overall revenues or net
income of a Funding Source or taxes excluded by Section 10.1) or (ii) that
imposes, modifies or deems applicable any reserve, assessment, insurance
charge, special deposit or similar requirement against assets of, deposits with
or for the account of a Funding Source, or credit extended by a Funding Source
pursuant to a Funding Agreement or (iii) that imposes any other condition the
result of which is to increase the cost to a Funding Source of performing its
obligations under a Funding Agreement, or to reduce the rate of return on a
Funding Source's capital as a consequence of its obligations under a Funding
Agreement, or to reduce the amount of any sum received or receivable by a
Funding Source under a Funding Agreement or to require any payment calculated
by reference to the amount of interests or loans held or interest received by
it, then, upon demand by the applicable Co-Agent, Borrower shall pay to such
Co-Agent, for the benefit of the relevant Funding Source, such amounts charged
to such Funding Source or such amounts to otherwise compensate such Funding
Source for such increased cost or such reduction.  Each Funding Source will promptly notify the applicable Co-Agent,
and such Co-Agent will promptly thereafter notify Borrower, of any event of
which it has knowledge, occurring after the date such Funding Source first
became entitled to the benefits of this Section, which will entitle such
Funding Source to compensation pursuant to this Section and will, if possible,
designate a different lending office if such designation will avoid the need
for, or reduce the amount of, such compensation and will not, in the judgment
of such Funding Source, be otherwise materially disadvantageous to such Funding
Source.  A certificate of any Funding
Source claiming compensation under this Section and setting forth the
additional amount or amounts to be paid to it hereunder and showing in
reasonable detail the calculation thereof shall be conclusive in the absence of
manifest error.  In determining such
amount, such Funding Source may use any reasonable averaging and attribution
methods previously disclosed in writing to Borrower.

28

Section 10.3         

Other Costs and Expenses

.  Borrower shall
pay to the Agents and the Conduits on demand all reasonable costs and out-of-pocket
expenses actually incurred in connection with the preparation, execution, and
delivery of this Agreement, the transactions contemplated hereby and the other
documents to be delivered hereunder, including without limitation, the cost of
each Review (subject to the limitations set forth in Section 7.1(d)).  Borrower shall pay to the Agents on demand
any and all reasonable costs and expenses of the Agents and the Lenders,
including reasonable counsel fees and expenses actually incurred in connection
with the enforcement of this Agreement and the other documents delivered
hereunder and in connection with any restructuring or workout of this Agreement
or such documents, or the administration of this Agreement following an
Amortization Event.

ARTICLE XI.

THE AGENTS

Section 11.1         

Authorization and Action

(a)               
Each member of the Blue Ridge Group hereby irrevocably
designates and appoints Wachovia Bank, National Association
as Blue Ridge Agent hereunder and under the other Transaction Documents to which the Blue
Ridge Agent is a party and authorizes the Blue Ridge Agent to take such action
on its behalf under the provisions of the Transaction
Documents and to exercise such powers
and perform such duties as are expressly delegated to the Blue Ridge Agent by
the terms of the Transaction Documents, together with such other powers as are
reasonably incidental thereto.  Each
member of the TPFC Group hereby irrevocably designates and appoints SunTrust as
TPFC Agent hereunder and under the other Transaction
Documents to which the TPFC Agent is a party , and
authorizes the TPFC Agent to take such action on its behalf under the
provisions of the Transaction Documents
and to exercise such powers and perform
such duties as are expressly delegated to the TPFC Agent by the terms of the Transaction Documents, together with such other powers as are reasonably incidental
thereto.  Each member of any other Group
that becomes a party to this Agreement after the date hereof shall designate
and appoint an agent and authorize such agent to take such action on its behalf
under the provision of the Transaction Documents, and to exercise such powers
and perform such duties as are expressly delegated to such agent by the terms
of the Transaction Documents, together with such other powers as are reasonably
incidental thereto.  Each of the Lenders
and the Co-Agents hereby irrevocably
designates and appoints Wachovia Bank, National Association
as Administrative Agent hereunder and under the Transaction Documents to which the Administrative Agent is a party, and each Lender
and Co-Agent that becomes a party to this Agreement hereafter ratifies such
designation and appointment and authorizes the Administrative Agent to take
such action on its behalf under the provisions of the Transaction Documents and
to exercise such powers and perform such duties as are expressly delegated to
the Administrative Agent by the terms of the Transaction Documents,
together with such other powers as are reasonably incidental thereto.  Notwithstanding any provision to the
contrary elsewhere in this Agreement, none of the Agents shall have any duties
or responsibilities, except those expressly set forth in the Transaction Documents to
which it is a party, or any fiduciary relationship with any Lender, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities on the part of such Agent shall be read into any Transaction
Document or otherwise exist against such Agent.

29

(b)              
The provisions of this Article XI are solely for the benefit of the Agents and the Lenders, and
none of the Loan Parties shall have any rights as a third-party beneficiary or
otherwise under any of the provisions of this Article XI, except that this Article XI shall not affect any obligations which any of the Agents or
Lenders may have to any of the Loan Parties under the other provisions of this
Agreement.

(c)               
In performing its functions and duties hereunder, (i) the Blue Ridge Agent shall act solely
as the agent of the members of the Blue Ridge Group and does not assume nor
shall be deemed to have assumed any obligation or relationship of trust or
agency with or for any of the Loan Parties or any of their respective
successors and assigns, (ii) the TPFC
Agent shall act solely as the agent of the members of the TPFC Group and does
not assume nor shall be deemed to have assumed any obligation or relationship
of trust or agency with or for any of the Loan Parties or any of their
respective successors and assigns, (iii) the agent for the member of any Group
that becomes a party hereto after the date hereof shall act solely as the agent
of the members of such Group and does not assume nor shall be deemed to have
assumed any obligation or relationship of trust or agency with or for any of
the Loan Parties or their respective successors or assigns, and (iv) the Administrative Agent shall act
solely as the agent of the Secured Parties and does not assume nor shall be
deemed to have assumed any obligation or relationship of trust or agency with
or for any of the Loan Parties or any of their respective successors and assigns.

Section 11.2         

Delegation of Duties

.  Each of the
Agents may execute any of its duties under this Agreement and each other
Transaction Document by or through agents or attorneys-in-fact and shall be
entitled to advice of counsel concerning all matters pertaining to such
duties.  None of the Agents shall be
responsible for the negligence or misconduct of any agents or attorneys-in-fact
selected by it with reasonable care.

Section 11.3         

Exculpatory Provisions

.  None of the
Agents nor any of its directors, officers, agents or employees shall be (i)
liable for any action lawfully taken or omitted to be taken by it or them under
or in connection with this Agreement or any other Transaction Document (except
for its, their or such Person's own gross negligence or willful misconduct), or
(ii) responsible in any manner to any of the Lenders or other Agents for any
recitals, statements, representations or warranties made by any Loan Party
contained in this Agreement, any other Transaction Document or any certificate,
report, statement or other document referred to or provided for in, or received
under or in connection with, this Agreement, or any other Transaction Document
or for the value, validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement, or any other Transaction Document or any other
document furnished in connection herewith or therewith, or for any failure of
any Loan Party to perform its obligations hereunder or thereunder, or for the
satisfaction of any condition specified in Article VI, or for the perfection,
priority, condition, value or sufficiency of any collateral pledged in
connection herewith.  None of the Agents
shall be under any obligation to any other Agent or any Lender to ascertain or
to inquire as to the observance or performance of any of the agreements or
covenants contained in, or conditions of, this Agreement or any other
Transaction Document, or to inspect the properties, books or records of the
Loan Parties.  None of the Agents shall
be deemed to have knowledge of any Amortization Event or Unmatured Amortization
Event unless such Agent has received notice from Borrower, another Agent or a
Lender.   

30

Section 11.4         

Reliance by the Agents

(a)               
Each of the Agents shall in all cases be entitled to rely, and
shall be fully protected in relying, upon any document or conversation believed
by it to be genuine and correct and to have been signed, sent or made by the
proper Person or Persons and upon advice and statements of legal counsel
(including, without limitation, counsel to Borrower), independent accountants
and other experts selected by such Agent. 
Each of the Agents shall in all cases be fully justified in failing or
refusing to take any action under this Agreement or any other Transaction
Document unless it shall first receive such advice or concurrence of such of
the Lenders or Liquidity Banks in its Group as it deems appropriate and it
shall first be indemnified to its satisfaction by the Liquidity Banks in its
Group against any and all liability, cost and expense which may be incurred by
it by reason of taking or continuing to take any such action.   

(b)              
Any action taken by any of the Agents in accordance with Section
11.5(a) shall be binding upon all of the Agents and the Lenders.

Section 11.5         

Non-Reliance on Other Agents and Other Lenders

.  Each Lender
expressly acknowledges that none of the Agents, nor any of its officers,
directors, employees, agents, attorneys-in-fact or affiliates has made any
representations or warranties to it and that no act by any Agent hereafter
taken, including, without limitation, any review of the affairs of any Loan
Party, shall be deemed to constitute any representation or warranty by such
Agent.  Each Lender represents and
warrants to each Agent that it has and will, independently and without reliance
upon any Agent or any other Lender and based on such documents and information
as it has deemed appropriate, made its own appraisal of and investigation into
the business, operations, property, prospects, financial and other conditions
and creditworthiness of Borrower and made its own decision to enter into this
Agreement, the other Transaction Documents and all other documents related
hereto or thereto.  

Section 11.6         

Reimbursement and Indemnification

.  Each Liquidity
Bank agrees to reimburse and indemnify (a) its applicable Co-Agent, (b) the
Administrative Agent and its officers, directors, employees, representatives
and agents ratably according to their Pro Rata Shares of their Group's
Percentage of the Obligations, to the extent not paid or reimbursed by the Loan
Parties (i) for any amounts for which such Agent, acting in its capacity as
Agent, is entitled to reimbursement by the Loan Parties hereunder and (ii) for
any other expenses incurred by such Agent, in its capacity as Agent and acting
on behalf of the Lenders, in connection with the administration and enforcement
of this Agreement and the other Transaction Documents.

Section 11.7         

Agents in their Individual Capacities

.  Each of the
Agents and its Affiliates may make loans to, accept deposits from and generally
engage in any kind of business with Borrower or any Affiliate of Borrower as
though such Agent were not an Agent hereunder. 
With respect to the making of Loans pursuant to this Agreement, each of
the Agents shall have the same rights and powers under this Agreement in its
individual capacity as any Lender and may exercise the same as though it were
not an Agent, and the terms "Liquidity Bank," "Lender,"
"Liquidity
Banks" and "Lenders" shall include each of the Agents in its individual
capacity.

31

Section 11.8         

Conflict Waivers

.  Each Co-Agent
acts, or may in the future act:  (i) as
administrative agent for such Co-Agent's Conduit, (ii) as issuing and paying
agent for such Conduit's Commercial Paper, (iii) to provide credit or liquidity
enhancement for the timely payment for such Conduit's Commercial Paper and (iv)
to provide other services from time to time for such Conduit (collectively, the
"Co-Agent
Roles").  Without limiting the
generality of Sections 11.1 and 11.8, each of the other Agents and the Lenders
hereby acknowledges and consents to any and all Co-Agent Roles and agrees that
in connection with any Co-Agent Role, a Co-Agent may take, or refrain from
taking, any action which it, in its discretion, deems appropriate, including,
without limitation, in its role as administrative agent for its Conduit, the
giving of notice to the Liquidity Banks in its Group of a mandatory purchase
pursuant to the Liquidity Agreement for such Group, and hereby acknowledges
that neither the applicable Co-Agent nor any of its Affiliates has any
fiduciary duties hereunder to any Lender (other than its Conduit) arising out
of any Co-Agent Roles.

Section 11.9         

UCC Filings

.  Each of the
Secured Parties hereby expressly recognizes and agrees that the Administrative
Agent may be listed as the assignee or secured party of record on the various
UCC filings required to be made under the Transaction Documents in order to
perfect their respective interests in the Collateral, that such listing shall
be for administrative convenience only in creating a record or nominee holder
to take certain actions hereunder on behalf of the Secured Parties and that
such listing will not affect in any way the status of the Secured Parties as
the true parties in interest with respect to the Collateral.  In addition, such listing shall impose no
duties on the Administrative Agent other than those expressly and specifically
undertaken in accordance with this Article XI.

Section 11.10     
 Successor
Administrative Agent

.  The
Administrative Agent, upon five (5) days' notice to the Loan Parties, the other
Agents  and the Lenders, may voluntarily
resign and may be removed at any time, with or without cause, by the Majority
Lenders; provided, however, that Wachovia shall not voluntarily resign
as the Administrative Agent so long as any of the Liquidity Commitments remain
in effect or Blue Ridge has any outstanding Loans.  If the Administrative Agent (other than Wachovia) shall
voluntarily resign or be removed as Administrative Agent under this Agreement,
then the Required Liquidity Banks during such five-day period shall appoint,
with the consent of Borrower from among the remaining Liquidity Banks, a
successor Administrative Agent, whereupon such successor Administrative Agent
shall succeed to the rights, powers and duties of the Administrative Agent and
the term "Administrative Agent" shall mean such successor agent, effective upon
its appointment, and the former Administrative Agent's rights, powers and
duties as Administrative Agent shall be terminated, without any other or
further act or deed on the part of such former Administrative Agent or any of
the parties to this Agreement.  Upon
resignation or replacement of any Administrative Agent in accordance with this
Section 11.8, the retiring Administrative Agent shall execute such UCC-3 or
other UCC assignments and amendments, and assignments and amendments of the
Transaction Documents, as may be necessary to give effect to its replacement by
a successor Administrative Agent.  After
any retiring Administrative Agent's resignation hereunder as Administrative
Agent, the provisions of this Article XI and Article X shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent under this Agreement.

32

ARTICLE XII.

ASSIGNMENTS; PARTICIPATIONS

Section
12.1         
Assignments.

(a)               
Each of the Agents, the Loan Parties and the Liquidity Banks
hereby agrees and consents to the complete or partial assignment by each
Conduit of all or any portion of its rights under, interest in, title to and
obligations under this Agreement to the Liquidity Banks in its Group pursuant
to its Liquidity Agreement.

(b)              
Any Liquidity Bank may at any time and from time to time
assign to one or more Eligible Assignees (each, a "Purchasing Liquidity Bank")
all or any part of its rights and obligations under this Agreement pursuant to
an assignment agreement substantially in the form set forth in Exhibit VII
hereto (an "Assignment Agreement") executed by such Purchasing Liquidity
Bank and such selling Liquidity Bank; provided, however, that any
assignment of a Liquidity Bank's rights and obligations hereunder shall include
a pro rata assignment of its rights and obligations under the applicable
Liquidity Agreement.  The consent of the
applicable Conduit shall be required prior to the effectiveness of any such
assignment by a Liquidity Bank in such Conduit's Group.  Each assignee of a Liquidity Bank must (i)
be an Eligible Assignee and (ii) agree to deliver to the applicable Co-Agent,
promptly following any request therefor by the applicable Co-Agent or the
applicable Conduit, an enforceability opinion with respect to such Liquidity Banks
obligations under the Transaction Documents to which such Liquidity Bank would
be a party in form and substance satisfactory to such Co-Agent and such
Conduit.  Upon delivery of an executed
Assignment Agreement to the applicable Co-Agent, such selling Liquidity Bank
shall be released from its obligations hereunder and under applicable Liquidity
Agreement to the extent of such assignment. 
Thereafter the Purchasing Liquidity Bank shall for all purposes be a
Liquidity Bank party to this Agreement and the applicable Liquidity Agreement
and shall have all the rights and obligations of a Liquidity Bank hereunder and
thereunder to the same extent as if it were an original party hereto and
thereto and no further consent or action by Borrower, the Lenders or the Agents
shall be required.  The applicable Agent
shall give the Borrower prior notice of the name of any assignee of a Liquidity
Bank in such Co-Agent's Group and the name(s) of the selling Liquidity Bank(s)
and the amounts assigned by each selling Liquidity Bank.

(c)               
Each of the Liquidity Banks agrees that in the event that it
shall suffer a Downgrading Event, the applicable Co-Agent shall promptly notify
Borrower and such Downgraded Liquidity Bank shall be obliged, at the request of
the applicable Conduit, the applicable Co-Agent or Borrower, to (i)
collateralize its Commitment and its Liquidity Commitment in a manner
acceptable to the applicable Co-Agent, or (ii) assign all of its rights and
obligations hereunder and under the applicable Liquidity Agreement to an
Eligible Assignee nominated by the applicable Co-Agent or a Loan Party and
acceptable to the applicable Conduit and willing to participate in this
Agreement and such Liquidity Agreement through the Liquidity Termination Date
in the place of such Downgraded Liquidity Bank; provided that the
Downgraded Liquidity Bank receives payment in full, pursuant to an Assignment
Agreement, of an amount equal to such Liquidity Bank's Pro Rata Share of such
Liquidity Bank's Group's Percentage of the Obligations owing to the Liquidity
Banks of such Group; provided further that if either conditions set forth above
in clause (i) or (ii) is not met with respect in such Downgraded Liquidity
Bank, the Liquidity Termination Date shall not occur if (A) the Groups that do
not have a Downgraded Liquidity Bank as a member elect to increase their
Conduit Allocation Limit and the related Liquidity Commitments in such amounts
that total the then existing Aggregate Commitment, (B) the Aggregate Commitment
is reduced by an amount equal to the commitments of the Liquidity Banks in such
Downgraded Liquidity Bank's Group, or (C) another Conduit Group agrees to
replace such Downgraded Liquidity Bank's Conduit Group on the terms and
conditions set forth herein (except for any amendments or modifications as are
acceptable to the remaining Conduit Groups, in their sole discretion), in each
case, prior to the end of the thirty day period set forth in the definition of
"Liquidity Termination Date" and with the consent of the remaining Conduit Groups
(which consent shall be in such Conduit Group's sole discretion).

33

(d)              
No Loan Party may assign any of its rights or obligations
under this Agreement without the prior written consent of each of the Agents
and each of the Lenders and without satisfying the Rating Agency Condition, if
applicable.

Section 12.2         

Participations

.  Any Liquidity Bank may, in the ordinary course of its business at
any time sell to one or more Persons (each, a "Participant")
participating interests in its Pro Rata Share of its Group's Percentage of
Aggregate Commitment, its Loans, its Liquidity Commitment or any other interest
of such Liquidity Bank hereunder or under the applicable Liquidity
Agreement.  Notwithstanding any such
sale by a Liquidity Bank of a participating interest to a Participant, such
Liquidity Bank's rights and obligations under this Agreement and such Liquidity
Agreement shall remain unchanged, such Liquidity Bank shall remain solely
responsible for the performance of its obligations hereunder and under such
Liquidity Agreement, and the Loan Parties, the Conduits and the Agents shall
continue to deal solely and directly with such Liquidity Bank in connection
with such Liquidity Bank's rights and obligations under this Agreement and the
applicable Liquidity Agreement.  Each
Liquidity Bank agrees that any agreement between such Liquidity Bank and any
such Participant in respect of such participating interest shall not restrict
such Liquidity Bank's right to agree to any amendment, supplement, waiver or
modification to this Agreement, except for any amendment, supplement, waiver or
modification described in Section 14.1(b)(i).

34

ARTICLE XIII.

SECURITY INTEREST

Section 13.1         

Grant of Security Interest

.  To secure the
due and punctual payment of the Obligations, whether now or hereafter existing,
due or to become due, direct or indirect, or absolute or contingent, including,
without limitation, all Indemnified Amounts, in each case pro rata according to
the respective amounts thereof, Borrower hereby grants to the Administrative
Agent, for the benefit of the Secured Parties, a security interest in, all of
Borrower's right, title and interest, whether now owned and existing or
hereafter arising in and to all of the Receivables, the Related Security and
all proceeds of the foregoing (collectively, the "Collateral").

Section 13.2         

Termination after Final Payout Date

.  Each of the
Secured Parties hereby authorizes the Administrative Agent or any other Agent,
if applicable, and the Administrative Agent or such other Agent, if applicable,
hereby agrees, promptly upon the Final Payout Date to execute and deliver to
Borrower a termination of and release of the security interests created under
this Agreement and any Collection Account Agreement, together with such UCC
termination statements or other documents as may be necessary as reasonably
determined by the Borrower to terminate, on behalf of itself, the other Agents
and the Lenders, the security interest in and Adverse Claim upon the Collateral
held by the Administrative Agent, or other Agent, if applicable, for the
benefit of the Secured Parties, all at Borrower's expense.  Upon the Final Payout Date, all right, title
and interest of the Administrative Agent, the other Agents and the Lenders in
and to the Collateral shall terminate. 
The Secured Parties agree that the Borrower shall be authorized to file
any UCC financing statements and amendment statements to evidence such
termination.

Section 13.3         
Excluded Receivables

.  Each of the
Secured Parties hereby authorizes the Administrative Agent or any other Agent,
if applicable, and the Administrative Agent or such other Agent, if applicable,
hereby agrees, promptly upon written request from the Borrower to execute and
deliver to Borrower such UCC termination statements or other documents as may
be necessary as reasonably determined by the Borrower to terminate, on behalf
of itself, the other Agents and the Lenders, the security interest in and
Adverse Claim upon any Excluded Receivable held by the Administrative Agent, or
other Agent, if applicable, for the benefit of the Secured Parties, all at Borrower's
expense.

ARTICLE XIV.

MISCELLANEOUS

Section
14.1         
Waivers and Amendments.

(a)               
No failure or delay on the part of any Agent or any Lender in
exercising any power, right or remedy under this Agreement shall operate as a
waiver thereof, nor shall any single or partial exercise of any such power,
right or remedy preclude any other further exercise thereof or the exercise of
any other power, right or remedy.  The
rights and remedies herein provided shall be cumulative and nonexclusive of any
rights or remedies provided by law.  Any
waiver of this Agreement shall be effective only in the specific instance and
for the specific purpose for which given.

35

(b)              
No provision of this Agreement may be amended, supplemented,
modified or waived except in writing in accordance with the provisions of this
Section 14.1(b).  The Conduits, Borrower
and the Administrative Agent, with the consent of the Required Liquidity Banks,
may enter into written modifications or waivers of any provisions of this
Agreement, provided, however, that no such modification or waiver shall:

(i)                 
without the consent of each affected Lender, (A) extend the
Liquidity Termination Date or the date of any payment or deposit of Collections
by Borrower or the Servicer, (B) reduce the rate or extend the time of payment
of Interest or any CP Costs (or any component of Interest or CP Costs), (C)
reduce any fee payable to any Agent for the benefit of the Lenders, (D) except
pursuant to Article XII hereof, change the amount of the principal of any
Lender, any Liquidity Bank's Pro Rata Share or any Liquidity Bank's Liquidity
Commitment, (E) amend, modify or waive any provision of the definition of
Required Liquidity Banks or this Section 14.1(b), (F) consent to or permit the
assignment or transfer by Borrower of any of its rights and obligations under
this Agreement, (G) change the definition of "Eligible Receivable," "Loss
Reserve," "Dilution Reserve," "Interest Reserve," "Servicing Reserve" or
"Required
Reserve" or (H) amend or modify any defined term (or any defined term
used directly or indirectly in such defined term) used in clauses (A) through
(G) above in a manner that would circumvent the intention of the restrictions
set forth in such clauses, or

(ii)               
without the written consent of any affected Agent, amend,
modify or waive any provision of this Agreement if the effect thereof is to
affect the rights or duties of such Agent,

and any material amendment, waiver or other
modification of this Agreement shall require satisfaction of the Rating Agency
Condition, to the extent the Rating Agency Condition is required of any
Conduit.  Notwithstanding the
foregoing, (i) without the consent of the Liquidity Banks, but with the consent
of Borrower, the applicable Co-Agent may direct the Administrative Agent to
amend this Agreement solely to add additional Persons as Liquidity Banks
hereunder and (ii) the Agents, the Required Liquidity Banks and the Conduits
may enter into amendments to modify any of the terms or provisions of Article
XI, Article XII or any other provision of this Agreement without the consent of
Borrower, provided that such amendment has no negative impact upon
Borrower.  Any modification or waiver
made in accordance with this Section 14.1 shall apply to each of the Lenders
equally and shall be binding upon Borrower, the Lenders and the Agents.

Section 14.2         

Notices

.  Except as
provided in this Section 14.2, all communications and notices provided for
hereunder shall be in writing (including bank wire, telecopy or electronic
facsimile transmission or similar writing) and shall be given to the other
parties hereto at their respective addresses or telecopy numbers set forth on
the signature pages hereof or at such other address or telecopy number as such
Person may hereafter specify for the purpose of notice to each of the other
parties hereto.  Each such notice or
other communication shall be effective (i) if given by telecopy, upon the
receipt thereof, (ii) if given by mail, three (3) Business Days after the time
such communication is deposited in the mail with first class postage prepaid or
(iii) if given by any other means, when received at the address specified in
this Section 14.2.  Borrower hereby
authorizes the Co-Agents to effect Advances and Interest Period and Interest
Rate selections based on telephonic notices made by any Person whom the
Borrower has designated in writing to the Agents and whom the applicable
Co-Agent in good faith believes to be acting on behalf of Borrower.  Borrower agrees to deliver promptly to the
applicable Co-Agent a written confirmation of each telephonic or electronic
mail notice signed by a Responsible Financial Officer of Borrower; provided,
however, the absence of such confirmation shall not affect the validity
of such notice.  If the written
confirmation differs from the action taken by the applicable Co-Agent, the
records of the applicable Co-Agent shall govern absent manifest error.

36

Section 14.3         

Ratable Payments

.  If (a) any
Lender, whether by setoff or otherwise, has payment made to such Lender in
respect to any portion of the Obligations owing to such Lender (other than
payments received pursuant to Section 10.2 or 10.3) in a greater proportion
than that received by any other Lender in such Lender's Group entitled to
receive a ratable share of such Obligations, such Lender agrees, promptly upon
demand, to purchase for cash without recourse or warranty a portion of such
Obligations held by the other Lenders in such Lender's Group so that after such
Purchase each Lender in such Group will hold its Pro Rata Share of such
Obligations and (b) any Group, whether by set off or otherwise, has payment
made to such Group (other than payments received pursuant to Section 10.2
or 10.3) in a greater proportion than that received by any other Group
entitled to receive a ratable share of such Obligations, the Lenders in such
Group agree, promptly upon demand, to purchase for cash without recourse or
warranty a portion of such Obligations held by the other Groups so that after
such purchase each Lender in such Group, taken together, will hold its Group's
Percentage of such Obligations; provided
that in the case of the preceeding clauses (a) and (b), if all or any
portion of such excess amount is thereafter recovered from such Lender or
Group, as applicable, such purchase shall be rescinded and the purchase price
restored to the extent of such recovery, but without interest.

Section 14.4         

Protection of Administrative Agent's Security
Interest

(a)               
Borrower agrees that from time to time, at its expense, it
will promptly execute and deliver all instruments and documents, and take all
actions, that may be necessary, or that any of the Agents may reasonably
request, to perfect, protect or more fully evidence the Administrative Agent's
security interest in the Collateral, or to enable the Agents or the Lenders to
exercise and enforce their rights and remedies hereunder.  At any time after the occurrence of an
Amortization Event, the Administrative Agent may, or the Administrative Agent
may direct Borrower or the Servicer to, notify the Obligors of Receivables, at
Borrower's expense, of the ownership or security interests of the Lenders under
this Agreement and may also direct that payments of all amounts due or that
become due under any or all Receivables be made directly to the Administrative
Agent or its designee.   

(b)              
If Borrower or any Performance Guarantor fails to perform any
of its obligations hereunder, any Agent or any Lender may (but shall not be
required to) perform, or cause performance of, such obligations, and such
Agent's or such Lender's reasonable costs and expenses incurred in connection
therewith shall be payable by Borrower as provided in Section 10.3.  Borrower irrevocably authorizes the
Administrative Agent at any time and from time to time in the sole discretion
of the Administrative Agent, and appoints the Administrative Agent as its
attorney-in-fact, to act on behalf of Borrower (i) to execute on behalf of
Borrower as debtor and to file financing statements necessary or desirable in
the Administrative Agent's sole discretion to perfect and to maintain the
perfection and priority of the interest of the Lenders in the Receivables and
(ii) to file a carbon, photographic or other reproduction of this Agreement or
any financing statement with respect to the Receivables as a financing
statement in such offices as the Administrative Agent in its sole discretion deems
necessary or desirable to perfect and to maintain the perfection and priority
of the Administrative Agent's security interest in the Collateral, for the
benefit of the Secured Parties.  This
appointment is coupled with an interest and is irrevocable.

37

Section
14.5         
Confidentiality.

(a)               
Each of the Loan Parties shall maintain and shall cause each
of its employees and officers to maintain the confidentiality of the Fee Letter
and the electronic models and files (including electronic files containing
model accounting entries for securitization transactions) provided by the
Agents or the Conduits in connection with this Agreement, provided,
however, such information may be disclosed to third parties to the
extent such disclosure is (i) required to comply with any applicable law (including
federal and state securities laws) or order of any judicial or administrative
proceeding, or (ii) required in response to any summons or subpoena or in
connection with any litigation, provided, further, that such Loan
Party informs such person that such information is sensitive, proprietary and
confidential.  Notwithstanding the
foregoing, the Loan Parties shall have no obligation of confidentiality in
respect of any information which may be generally available to the public or
becomes available to the public through no fault of such Loan Party or its
Affiliates.

(b)              
Each of the Lenders and each of the Agents shall maintain and
shall cause each of its employees, officers and agents to maintain the
confidentiality of any nonpublic information with respect to the Originators
and the Loan Parties, except that any of the foregoing may disclose such
information (i) to any party to this Agreement, (ii) to any prospective or
actual assignee or participant of any of the Agents or any Lender, (iii) to any
rating agency who rates the Commercial Paper, to any Commercial Paper dealer,
and to any provider of a surety, guaranty or credit or liquidity enhancement to
any Conduit or any other entity organized for the purpose of purchasing, or
making loans secured by, financial assets for which Wachovia or SunTrust acts
as the administrative agent and to any officers, directors, employees, outside
accountants and attorneys of each of the foregoing, provided that each Person
described in the foregoing clause (ii) or (iii) is informed of the confidential
nature of such information and, in the case of a Person described in clause
(ii), agrees in writing to maintain the confidentiality of such information in
accordance with this Section 14.5(b); and (iv) as required pursuant to any law,
rule, regulation, direction, request or order of any judicial, administrative
or regulatory authority or proceedings (whether or not having the force or
effect of law).  Notwithstanding the
foregoing, (x) each Conduit shall be permitted to disclose Receivables
performance information and details concerning the structure of the facility
contemplated hereby in summary form and in a manner not identifying the
Originators, the Borrower, the Servicer, the Parent, or the Obligors to
prospective investors in Commercial Paper issued by such Conduit, and (y) the
Conduits, the Agents and the Lenders shall have no obligation of
confidentiality in respect of any information which may be generally available
to the public or becomes available to the public through no fault of theirs or
their respective Affiliates.

38

Section 14.6         

Bankruptcy Petition

.  Borrower, the
Servicer, each Agent and each Liquidity Bank hereby covenants and agrees that,
prior to the date that is one year and one day after the payment in full of all
outstanding senior indebtedness of any Conduit, it will not institute against,
or join any other Person in instituting against, such Conduit any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings or other
similar proceeding under the laws of the United States or any state of the
United States.

Section 14.7         

CHOICE OF LAW

.  THIS AGREEMENT
AND EACH OF THE OTHER TRANSACTION DOCUMENTS SHALL BE GOVERNED AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF GEORGIA, without regard to the principles of conflicts of laws thereof
(except in the case of the other Transaction Documents, to the extent otherwise
expressly stated therein) AND EXCEPT TO THE EXTENT THAT THE PERFECTION
OF THE OWNERSHIP INTEREST OF BORROWER OR THE SECURITY INTEREST OF THE ADMINISTRATIVE
AGENT, FOR THE BENEFIT OF THE SECURED PARTIES, IN ANY OF THE COLLATERAL IS
GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF GEORGIA.

Section 14.8         

CONSENT TO JURISDICTION

.  EACH PARTY TO
THIS AGREEMENT HEREBY IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF
ANY UNITED STATES FEDERAL OR GEORGIA STATE COURT SITTING IN FULTON COUNTY,
GEORGIA IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY DOCUMENT EXECUTED BY SUCH PERSON PURSUANT TO THIS AGREEMENT,
AND EACH SUCH PARTY HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF
SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT AND
IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE
OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH
COURT IS AN INCONVENIENT FORUM.  NOTHING
HEREIN SHALL LIMIT THE RIGHT OF THE AGENT OR ANY LENDER TO BRING PROCEEDINGS
AGAINST ANY LOAN PARTY IN THE COURTS OF ANY OTHER JURISDICTION.  ANY JUDICIAL PROCEEDING BY ANY LOAN PARTY
AGAINST ANY AGENT OR ANY LENDER OR ANY AFFILIATE OF ANY AGENT OR ANY LENDER
INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF,
RELATED TO, OR CONNECTED WITH THIS AGREEMENT OR ANY DOCUMENT EXECUTED BY SUCH
LOAN PARTY PURSUANT TO THIS AGREEMENT SHALL BE BROUGHT ONLY IN A COURT IN
FULTON COUNTY, GEORGIA.

Section 14.9         

WAIVER OF JURY TRIAL

.  EACH PARTY
HERETO HEREBY WAIVES TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING,
DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR
OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH THIS
AGREEMENT, ANY DOCUMENT EXECUTED BY ANY LOAN PARTY PURSUANT TO THIS AGREEMENT
OR THE RELATIONSHIP ESTABLISHED HEREUNDER OR THEREUNDER.

39

Section 14.10     
 Integration;
Binding Effect; Survival of Terms

(a)               
This Agreement and each other Transaction Document contain the
final and complete integration of all prior expressions by the parties hereto
with respect to the subject matter hereof and shall constitute the entire
agreement among the parties hereto with respect to the subject matter hereof
superseding all prior oral or written understandings.

(b)              
This Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective successors and permitted assigns
(including any receiver or trustee in bankruptcy appointed for any of the
parties or their respective successors and assigns).  This 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 terminated in accordance with its terms; provided,
however, that the rights and remedies with respect to (i) any breach of
any representation and warranty made by any Loan Party pursuant to Article V,
(ii) the indemnification and payment provisions of Article X, and Sections 14.5
and 14.6 shall be continuing and shall survive any termination of this
Agreement.

Section 14.11     
 Counterparts;
Severability; Section References

.  This Agreement
may be executed in any number of counterparts and by different parties hereto
in separate counterparts, each of which when so executed shall be deemed to be
an original and all of which when taken together shall constitute one and the
same Agreement.  Any provisions of this
Agreement which are prohibited or unenforceable in any jurisdiction shall, as
to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction.  Unless otherwise expressly indicated, all
references herein to "Article," "Section," "Schedule"
or "Exhibit"
shall mean articles and sections of, and schedules and exhibits to, this Agreement.

<signature pages follow>

 

40

IN WITNESS WHEREOF, the Loan Parties
hereto have caused this Agreement to be executed and delivered by their duly
authorized officers as of the date hereof in Wilmington, Delaware, and each of
the other parties hereto has caused this Agreement to be executed and delivered
by their duly authorized officers or attorneys-in-fact as of the date hereof.

MOHAWK FACTORING, INC.

By:                                                                  
 

Name:              Linda Bubacz

Title:                 Assistant Treasurer and Secretary

Address:          300 Delaware Avenue

                        Suite 1273C

                        Wilmington, Delaware  19801

                        Attn:              Linda Bubacz

                        Phone:            (302) 552-3110

                        Fax:            (302)
552-3128

MOHAWK SERVICING, INC.

By:                                                                  
 

Name:              Scott R. Veldman

Title:                 Vice President and Treasurer

Address:          160 S. Industrial Blvd.

                        Calhoun, GA 30703

                        Attn:            Scott R. Veldman

                        Phone:            (706) 624-2103

                        Fax:            (706)
624-2052

BLUE RIDGE ASSET FUNDING CORPORATION

BY:  WACHOVIA CAPITAL MARKETS,
LLC, ITS ATTORNEY-IN-FACT

By:  __________________________________

            Name: 
 

            Title:   
 

Address:         Blue Ridge Asset Funding Corporation

                                    301 South College Street

                                    Charlotte, North Carolina  28288

                                    Attention:          Doug Wilson

                                    Phone:              (704) 374-2520

                                    Fax:                  (704) 383-9579

 

                                   
             With a copy to:

                                    Blue Ridge Asset Funding Corporation

                                    c/o AMACAR Group, L.L.C.
                                    6525 Morrison Blvd., Suite 318
                                    Charlotte, North Carolina 28211

                                    Attention:            Douglas K. 
Johnson

                                    Phone:              (704) 365-0569
                                    Fax:                  (704) 365-1362

WACHOVIA BANK, NATIONAL
ASSOCIATION, as Blue Ridge Agent, a
Liquidity Bank and as Administrative Agent

By:                                                                  
 

Name:

Title:

Address:            Wachovia Bank, National Association

191 Peachtree Street, 22nd
Floor
                        GA-423

Atlanta, Georgia  30303
                        Attention:  Cecil
Noble

                        Phone:            (404) 332-4290
                        Fax:            (404)
332-5152

THREE PILLARS FUNDING CORPORATION

By:                                                                  
 

Name:                                                              
 

Title:                                                                 
 

Address:          c/o AMACAR Group, L.L.C.

                        6525 Morrison Boulevard

                        Suite 319

                        Charlotte, North Carolina  28211

            Attention:  Susan Burdick-Brennan

            Phone:  (704) 365-0569

            Fax:  (704) 365-1362

SUNTRUST CAPITAL MARKETS, INC., as TPFC Agent,  

and as a Liquidity
Bank

By:                                                                  
 

Name:                                                              
 

Title:                                                                 
 

Address:            SunTrust Capital Markets, Inc.

                        24th Floor, MC3950

                        303 Peachtree Street

                        Atlanta, Georgia  30308

            Attention:  Robert Anderson

            Phone:  (404) 588-7607

            Fax:  (404) 230-1344

EXHIBIT I

DEFINITIONS

As used in this Agreement, the following
terms shall have the following meanings (such meanings to be equally applicable
to both the singular and plural forms of the terms defined):

"Adjusted Dilution Ratio" means, at
any time, the rolling average of the Dilution Ratio for the 12 Calculation
Periods then most recently ended.

"Administrative Agent" has the
meaning set forth in the preamble to this Agreement.

"Advance"  means a borrowing
hereunder consisting of the aggregate amount of the several Loans made on the
same Borrowing Date.

"Adverse Claim" means a lien,
security interest, charge or encumbrance, or other right or claim in, of or on
any Person's assets or properties in favor of any other Person.

"Affiliate" means, with respect to
any Person, any other Person directly or indirectly controlling, controlled by,
or under direct or indirect common control with, such Person or any Subsidiary
of such Person.  A Person shall be deemed
to control another Person if the controlling Person owns 10% or more of any
class of voting securities of the controlled Person or possesses, directly or
indirectly, the power to direct or cause the direction of the management or
policies of the controlled Person, whether through ownership of stock, by
contract or otherwise.

"Agents" has the meaning set forth in the preamble to
this Agreement.

"Aggregate Commitment" means, on any
date of determination, the aggregate amount of the Commitments to make Loans
hereunder.  As of the date hereof, the
Aggregate Commitment is $350,000,000.

"Aggregate Principal" means, on any
date of determination, the aggregate outstanding principal amount of all
Advances outstanding on such date.

"Aggregate Reduction" has the
meaning specified in Section 1.3.

"Agreement" means this Amended and
Restated Credit and Security Agreement, as it may be amended or modified and in
effect from time to time.

"Alternate Base Rate" means for any
day, the rate per annum equal to the
higher as of such day of (i) the Prime Rate, or (ii) one-half of one percent
(0.50%) above the Federal Funds Rate. 
For purposes of determining the Alternate Base Rate for any day, changes
in the Prime Rate or the Federal Funds Rate shall be effective on the date of
each such change.

44

"Alternate Base Rate Loan" means a
Loan which bears interest at the Alternate Base Rate or the Default Rate, as
applicable.

"Amortization Date" means the
earliest to occur of (i) the day on which any of the conditions precedent set
forth in Section 6.2 are not satisfied, (ii) the Business Day immediately prior
to the occurrence of an Event of Bankruptcy with respect to any Loan Party,
(iii) the Business Day specified in a written notice from the Administrative
Agent, at the direction of either Co-Agent, following the occurrence of any
other Amortization Event, and (iv) the date which is ten (10) Business Days
after the Administrative Agent's receipt of written notice from Borrower that
it wishes to terminate the facility evidenced by this Agreement.

"Amortization Event" has the meaning
specified in Article IX.

"Applicable Margin"  
means the
applicable margin specified in Section 2.05(a)(iii) of the Mohawk Credit
Agreement.

"Assignment Agreement" has the
meaning set forth in Section 12.1(b).

"Blue Ridge" has the meaning set
forth in the preamble to this Agreement.

"Blue Ridge Agent" has the meaning
set forth in the preamble to this Agreement.

"Blue Ridge Group" has the meaning
set forth in the preamble to this Agreement.

"Blue Ridge Liquidity Agreement"
means that certain liquidity asset purchase agreement dated as of the date
hereof by and among Blue Ridge, the Blue Ridge Liquidity Banks and Wachovia as
Blue Ridge Agent and liquidity agent, as the same may be amended, restated
and/or otherwise modified from time to time.

"Blue Ridge Liquidity Banks" means
Wachovia and its successor and permitted assigns under the Blue Ridge Liquidity
Agreement.

"Borrower" has the meaning set forth
in the preamble to this Agreement.

"Borrowing Base" means, on any date
of determination, the Net Pool Balance as of the last day of the period covered
by the most recent Monthly Report, minus the Required Reserve as of the
last day of the period covered by the most recent Monthly Report, and minus
Deemed Collections that have occurred since the most recent Cut-Off Date to the
extent that such Deemed Collections exceed the Dilution Reserve.

"Borrowing Date"  
means a Business
Day on which an Advance is made hereunder.

"Borrowing Limit"  
means an amount
equal to the sum of the Conduit Allocation Limits.

45

"Borrowing Notice" has the meaning
set forth in Section 1.2.

"Broken Funding Costs" means for any
CP Rate Loan or LIBO Rate Loan:  (a) in
the case of any Conduit which utilizes Pooled Commercial Paper, which is funded
with Pooled Commercial Paper and, has its principal reduced without compliance
by Borrower with the notice requirements hereunder, (b) in the case of any Conduit,
which is funded with Commercial Paper that is not Pooled Commercial Paper and
has its principal reduced on any day other than the last day of the applicable
tranche period(s) of such Commercial Paper; (c) in the case of any Conduit, in
the case of a CP Rate Loan or a LIBO Rate Loan, does not become subject to its
Percentage of an Aggregate Reduction following the delivery of any Reduction
Notice, (d) in the case of a CP Rate Loan, is assigned under the applicable
Liquidity Agreement, or (e) in the case of a LIBO Rate Loan made by a Conduit,
which is terminated or reduced prior to the last day of its Interest Period, an
amount equal to the excess, if any, of (i) the CP Costs or Interest (as
applicable) that would have accrued during the remainder of the Interest
Periods or the tranche periods for Commercial Paper determined by the
applicable Co-Agent to relate to such Loan (as applicable) subsequent to the
date of such reduction, assignment or termination (or in respect of clause (c)
above, the date such Aggregate Reduction was designated to occur pursuant to
the Reduction Notice) of the principal of such Loan if such reduction,
assignment or termination had not occurred or such Reduction Notice had not
been delivered, over (ii) the sum of (x) to the extent all or a portion of such
principal is allocated to another Loan, the amount of CP Costs or Interest
actually accrued during the remainder of such period on such principal for the
new Loan, and (y) to the extent such principal is not allocated to another
Loan, the income, if any, actually received during the remainder of such period
by the holder of such Loan from investing the portion of such principal not so
allocated.  In the event that the amount
referred to in clause (B) exceeds the amount referred to in clause (A), the
relevant Lender or Lenders agree to pay to Borrower the amount of such
excess.  All Broken Funding Costs shall
be due and payable hereunder upon demand.

"Business Day" means any day on
which banks are not authorized or required to close in New York, New York or
Atlanta, Georgia, and The Depository Trust Company of New York is open for
business, and, if the applicable Business Day relates to any computation or
payment to be made with respect to the LIBO Rate, any day on which dealings in
dollar deposits are carried on in the London interbank offering market.

"Calculation Period"  
means a fiscal
month of the Borrower or portion thereof which elapses during the term of this
Agreement prior to the Final Payout Date. 
The first Calculation Period shall commence on the date of the initial
Advance hereunder.   For purposes of the use of this
term in other definitions in Exhibit I to this Agreement, Calculation Periods
occurring prior to the date of the initial Advance shall mean a fiscal month of
the Borrower.

"Canadian Receivable"  
means a
Receivable owing from an Obligor domiciled in, or organized under the laws of,
Canada or one of its political subdivisions.

"Cash Discount"  
means any reduction in a Receivable due to any cash
discount taken by an Obligor.

"Cash Discount Reduction"means at any time, 3% of the
Outstanding Balance of Receivables originated by Mohawk Distribution.

46

"Change of Control" means the
acquisition by any Person, or two or more Persons acting in concert (other than
the Performance Guarantor or any of its Subsidiaries; provided that Performance
Guarantor remains the direct or indirect owner of 100% of the outstanding
shares of voting stock of any Loan Party), of beneficial ownership (within the
meaning of Rule 13d-3 of the Securities and Exchange Commission under the
Securities Exchange Act of 1934) of 30% or more of the outstanding shares of
voting stock of any Loan Party.

"Co-Agent" has the meaning set forth in the
preamble to this Agreement.

"Co-Agent Account" means the account set up
to receive payments for the applicable Group including without limitation, the
Blue Ridge Agent's Account and the TPFC Agent Account.

"Collateral"  has the meaning set
forth in Section 13.1.

"Collection Account" means each
concentration account, depositary account, lock-box account or similar account
in which any Collections are collected or deposited.

"Collection Account Agreement" means
an agreement substantially in the form of Exhibit VI hereto which has been duly
executed by each of the parties thereto or otherwise acceptable to the Agents
in their sole discretion.

"Collection Bank" means, at any
time, any of the banks holding one or more Collection Accounts.

"Collection Notice" means a notice,
in substantially the form of Annex A to Exhibit VI, from the Administrative
Agent or such other Agent as is acceptable to the Agents in their sole
discretion to a Collection Bank.

"Collection Records"  
means, with
respect to any Receivable, all Invoices and all other documents, books, records
and other information (including, without limitation, computer programs, tapes,
disks, punch cards, data processing software and related property and rights)
relating to amounts paid on or owing in respect of such Receivable.

"Collections" means, with respect to
any Receivable, all cash collections and other cash proceeds in respect of such
Receivable, including, without limitation, all Finance Charges or other related
amounts accruing in respect thereof and all cash proceeds of Related Security
with respect to such Receivable.

"Commercial Paper" means promissory
notes of any Conduit issued by such Conduit, in each case, in the commercial
paper market.

"Commitment" means, for each
Liquidity Bank, the commitment of such Liquidity Bank to make its Pro Rata
Share of its Group's Percentage of Loans to Borrower hereunder in the event the
applicable Conduit elects not to fund any Advance in an aggregate principal
amount at any one time outstanding not to exceed the amount set forth opposite
such Liquidity Bank's name on Schedule A to this Agreement.

47

"Conduit" has the meaning set froth in the
preamble to this Agreement.

"Conduit Allocation Limit" has the meaning
set forth in Section 1.1(a).

"Conduit Group" has the meaning set forth in
the preamble to this Agreement.

"Contingent Obligation" of a Person
means any agreement, undertaking or arrangement by which such Person assumes,
guarantees, endorses, contingently agrees to purchase or provide funds for the
payment of, or otherwise becomes or is contingently liable upon, the obligation
or liability of any other Person, or agrees to maintain the net worth or
working capital or other financial condition of any other Person, or otherwise
assures any creditor of such other Person against loss, including, without
limitation, any comfort letter, operating agreement, take-or-pay contract or
application for a letter of credit.

"Contract" means, with respect to
any Receivable, any and all instruments and agreements, purchase orders,
invoices, writings, or other communications pursuant to which such Receivable
arises but excluding any Invoice.

"CP Costs" means, (A) for TPFC, for
each day, the sum of (i) discount or interest accrued on its Related Commercial
Paper at the TPFC Commercial Paper Rate on such day, plus (ii) any and all
accrued commissions and fees of placement agents, dealers and issuing and
paying agents incurred in respect of such Related Commercial Paper for such
day; and (B) for Blue Ridge, for each day, the sum of (i) discount or interest
accrued on Pooled Commercial Paper on such day, plus (ii) any and all accrued
commissions in respect of placement agents and Commercial Paper dealers, and
issuing and paying agent fees incurred, in respect of such Pooled Commercial
Paper for such day, plus (iii) other costs associated with funding small or
odd-lot amounts with respect to all receivable purchase facilities which are
funded by Pooled Commercial Paper for such day, minus (iv) any accrual of
income net of expenses received on such day from investment of collections
received under all receivable purchase facilities funded substantially with
Pooled Commercial Paper, minus (v) any payment received on such day net of
expenses in respect of Broken Funding Costs related to the prepayment of any
Loan of Blue Ridge pursuant to the terms of any receivable purchase facilities
funded substantially with Pooled Commercial Paper.  In addition to the foregoing costs, if Borrower shall request any
Advance during any period of time determined by the Blue Ridge Agent in its
sole discretion to result in incrementally higher CP Costs applicable to Blue
Ridge's Percentage of such Advance, the principal associated with any such
Advance shall, during such period, be deemed to be funded by Blue Ridge in a
special pool (which may include capital associated with other receivable
purchase or financing facilities) for purposes of determining such additional
CP Costs applicable only to such special pool and charged each day during such
period against such principal.

"CP Rate Loan"  means, for each Loan
of a Conduit prior to the time, if any, when (i) it is refinanced with a
Liquidity Funding pursuant to a Liquidity Agreement, or (ii) the occurrence of
an Amortization Event and the commencement of the accrual of Interest thereon
at the Default Rate.

48

"CP Tranche Period" means with
respect to any Loan of TPFC that is funded with Commercial Paper, a period of
days from 1 Business Day up to the number of days necessary to extend such
period to include the next Settlement Date, commencing on a Business Day, which
period is either (i) requested by Borrower and agreed to by TPFC or the TPFC
Agent or (ii) in the absence of such request and agreement, selected by TPFC or
the TPFC Agent (it being understood that the goal shall be to select a period
which ends on or as close to the next Settlement Date as possible).

"Credit and Collection Policy" means
Borrower's credit and collection policies and practices relating to Contracts
and Receivables existing on and as administered historically prior to the date
hereof and summarized in Exhibit VIII hereto, as modified from time to time in
accordance with this Agreement.

"Cut-Off Date" means the last day of
a Calculation Period.

"Days Sales Outstanding" means, as
of any day, an amount equal to the product of (x) 91, multiplied by (y) the amount
obtained by dividing (i) the aggregate outstanding balance of Receivables as of
the most recent Cut-Off Date, by (ii) the aggregate amount of Receivables
created during the three (3) Calculation Periods including and immediately
preceding such Cut-Off Date.

"Deemed Collections"  
means
Collections deemed received by Borrower under Section 1.4(a).

"Default Horizon Ratio" means, as of
any Cut-Off Date, the ratio (expressed as a decimal) computed by dividing (a)
the sum of (i) the product of the aggregate sales generated by the Originators
during the Calculation Period ending on such Cut-Off Date, multiplied by
the Weighted Average Credit Percentage, plus (ii) the aggregate sales generated
by the Originators during the three Calculation Periods ending prior to the
Calculation Period described in clause(a)(i), by (b) the Net Pool Balance as of
such Cut-off Date.

"Default Rate" means for any day, a
rate per annum equal to the Prime
Rate plus two percent (2.00%).  For
purposes of determining the Prime Rate for any day, changes in the Prime Rate
shall be effective on the date of each such change.

"Default Ratio" means, as of any
Cut-Off Date, the ratio (expressed as a percentage) computed by dividing (x)
the total amount of Receivables which became Defaulted Receivables during the
Calculation Period that includes such Cut-Off Date, by (y) the aggregate dollar
amount of Receivables generated by the Originators during the Calculation
Period occurring four months prior to the Calculation Period ending on such
Cut-Off Date.

"Defaulted Receivable" means a
Receivable:  (i) as to which the Obligor
thereof has suffered an Event of Bankruptcy; (ii) which, consistent with the
Credit and Collection Policy, would be written off Borrower's books as
uncollectible; or (iii) as to which any payment, or part thereof, remains
unpaid for 61 days or more from the original due date for such payment.

49

"Delinquency Ratio" means, at any
time, a percentage equal to (i) the aggregate Outstanding Balance of all
Receivables that were Delinquent Receivables at such time divided by (ii) the
aggregate Outstanding Balance of all Receivables at such time.

"Delinquent Receivable" means a
Receivable as to which any payment, or part thereof, remains unpaid for 31-60days from the original due date for such
payment or which is delinquent under the Credit and Collection Policy.

"Demand Advance"  
means an advance of
Collections made by Borrower to Mohawk Resources or Mohawk Carpet, as the case
may be, on any day prior to the Facility Termination Date on which no
Amortization Event or Unmatured Amortization Event exists and is continuing,
which advance (a) is payable upon demand, (b) bears interest at a market rate
determined from time to time by Borrower and Mohawk Resources or Mohawk Carpet,
as the case may be, and (c) is not subordinated to any other Indebtedness or
obligation of Mohawk Resources or Mohawk Carpet, as the case may be,.

"Dilution" means the amount of any
reduction or cancellation of the Outstanding Balance of a Receivable as
described in Section 1.4(a).

"Dilution Horizon Ratio" means, as
of any Cut-Off Date, an amount, equal to a fraction, the numerator of which is
(I) prior to a Dilution Reserve Event, (A) the aggregate dollar amount of
Receivables generated by the Originators for the most recent Calculation Period
plus (B) the product of (i) the aggregate dollar amount of Receivables
generated by the Originators for the second preceding Calculation Period times
(ii) the difference of (a) the ratio of (x) the 12-month high Days Sales
Outstanding divided by (y) thirty (30) minus (b) one (1) and (II) after a
Dilution Reserve Event, the aggregate dollar amount of Receivables generated by
the Originators for the two most recent Calculation Periods plus one-half (1/2)
of the aggregate dollar amount of Receivables generated by the Originators
during the Calculation Period occurring three months prior to the Calculation
Period ending on such Cut-Off Date and the denominator of which is the
aggregate balance of the Net Pool Balance as of the most recent Cut-Off Date.

"Dilution Ratio" means, as of any
Cut-Off Date, an amount (expressed as a percentage) equal to a fraction, the
numerator of which is the total amount of Dilution during the previous
Calculation Period, and the denominator of which is the aggregate amount of
Receivables generated by the Originators (i) prior to a Dilution Reserve Event
during the second preceding Calculation Period and (ii) following a Dilution
Reserve Event during the third preceding Calculation Period.

"Dilution Reserve" means, on any
date of determination, the product (expressed as a percentage) of:

(a) the sum of (i) two (2) times the Adjusted
Dilution Ratio, plus (ii) the
Dilution Volatility Component,  times

(b) the Dilution Horizon Ratio.

"Dilution Reserve Event"
 means either
(1) the Performance Guarantor's Debt to Capitalization Ratio (as defined in the
Mohawk Credit Agreement) shall be greater than 0.60 to 1.0 at the end of each
fiscal quarter and/or (2) the ratio of the Performance Guarantor's (a)
Consolidated Debt (as defined in the Mohawk Credit Agreement) to (b) the sum of
(i) Consolidated Net Income (as defined in the Mohawk Credit Agreement), (ii)
Consolidated Interest Expense (as defined in the Mohawk Credit Agreement),
(iii) taxes on the Performance Guarantor's consolidated pre-tax income, and
(iv) Depreciation and Amortization (as defined in the Mohawk Credit Agreement)
shall be greater than 3.5 to 1.0 at the end of each fiscal quarter.  Clause (b) in this definition shall be
calculated on a trailing 4 quarter basis as at the end of each such fiscal
quarter.

50

"Dilution Volatility Component"
means the product (expressed as a percentage) of (i) the difference between (a)
the highest one (1)-month Dilution Ratio over the past 12 Calculation Periods
and (b) the Adjusted Dilution Ratio, and (ii) a fraction, the numerator of
which is equal to the amount calculated in (i)(a) of this definition and the
denominator of which is equal to the amount calculated in (i)(b) of this
definition.

"Downgraded Liquidity Bank"  
means a
Liquidity Bank which has been the subject of a Downgrading Event.

"Downgrading Event"  
with respect to
any Person means the lowering of the rating with regard to the short-term
securities of such Person to below (i) A-1 by S&P, or (ii) P-1 by Moody's.

"Eligible Assignee" means a
commercial bank having a combined capital and surplus of at least $250,000,000
with a rating of its (or its parent holding company's) short-term securities
equal to or higher than (i) A-1 by S&P and (ii) P-1 by Moody's.

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

(i)                 
the Obligor of which (a) if a natural person, is a resident of
the United States or Canada or, if a corporation or other business
organization, is organized under the laws of the United States, Canada or any
political subdivision of the United States or Canada and has its chief
executive office in the United States or Canada;  provided, however, that in no event may the Canadian
Receivables that are included as Eligible Receivables exceed 3% of total
Receivables at any time; (b) is not an Affiliate of any of the parties hereto;
and (c) is not a government or a governmental subdivision or agency,

(ii)               
which is not a Defaulted Receivable,

(iii)              
which was not a Delinquent Receivable on (A) the date of
Purchase (as defined in the Receivables Sale Agreement) (if such Receivable was
in existence on the Initial Cutoff Date), or (B) the date on which such
Receivable came into existence (in all other cases),

(iv)             
which (A) by its terms is due and payable within 91 days of
the original billing date therefor; provided, however, notwithstanding
anything herein to contrary, any Receivable which by its terms is due and
payable within 92-120 days of the original billing date thereof shall be
included as an Eligible Receivable, provided that the Outstanding Balance of
all such Receivables shall not exceed 2.5% of the total Outstanding Balance of
all Eligible Receivables, (B) has not had its payment terms extended more than
once, and if such extension had not been made, such Receivable would not
otherwise have become a Defaulted Receivable, and (C) will not, when added to
all other Eligible Receivables, cause the weighted average of the payment terms
for all Eligible Receivables to exceed 50 days,

51

(v)               
which is an "account," a "payment intangible," a "general intangible"
or "chattel paper" within the meaning of Article 9 of the UCC of all applicable
jurisdictions, and is not evidenced by an "instrument" within the meaning of
Article 9 of the UCC,

(vi)             
which is denominated and payable only in United States Dollars
or Canadian Dollars in the United States or Canada,

(vii)            
which is in full force and effect and constitutes the legal,
valid and binding obligation of the related Obligor enforceable against such
Obligor in accordance with its terms,

(viii)          
which does not contain a confidentiality provision that
purports to restrict the ability of the  
Borrower (or, at any time this
Agreement remains in effect and after an Amortization Event which is
continuing, the Administrative Agent as the Borrower's assignee) to exercise
its rights under this Agreement, including, without limitation, its right to
review the Contract or Invoice applicable thereto,

(ix)             
which represents an obligation to pay a specified sum of
money, contingent only upon (A) the sale of goods or the provision of services
by the applicable Originator (which sale has been consummated or services have
been performed), and (B) satisfaction by such Originator of any applicable
warranty claims which have not yet been made or asserted,

(x)               
which does not contravene any law, rule or regulation
applicable thereto (including, without limitation, any law, rule and regulation
relating to truth in lending, fair credit billing, fair credit reporting, equal
credit opportunity, fair debt collection practices and privacy),

(xi)             
which satisfies all applicable requirements of the applicable
Credit and Collection Policy,

(xii)            
which was generated in the ordinary course of the applicable
Originator's business,

(xiii)          
which arises solely from the sale (and not the lease) of goods
or the provision of services to the related Obligor by the applicable
Originator or a predecessor to such Originator, and not by any other Person (in
whole or in part),

(xiv)          
which is not the subject of, to the Originator's knowledge,
any dispute, counterclaim, right of rescission, set-off, counterclaim or any
other defense (including defenses arising out of violations of usury laws) of
the applicable Obligor against the applicable Originator or any other Adverse
Claim, and the Obligor thereon holds no rights as against such Originator to
cause such Originator to repurchase the goods or merchandise the sale of which
shall have given rise to such Receivable (except with respect to sale discounts
effected pursuant to the Contract, or defective goods returned in accordance
with the terms of the Contract) and which requires that all or part of such
receivable be charged off in accordance with the Credit and Collection Policy; provided,
however,
that if such dispute, offset, counterclaim or defense affects only a portion of
the Outstanding Balance of such Receivable, then such Receivable may be deemed
an Eligible Receivable to the extent of the portion of such Outstanding Balance
which is not so affected,

52

(xv)           
as to which the applicable Originator has satisfied and fully
performed all obligations on its part with respect to such Receivable required
to be fulfilled by it, and no further action is required to be performed by any
Person with respect thereto other than payment thereon by the applicable
Obligor (excluding any warranty obligation for which no claims exists or is
know to exist),  

(xvi)          
as to which each of the representations and warranties
contained in Sections 5.1(i), (j), (r), (s) and (t) is true and correct, and

(xvii)        
all right, title and interest to and in which has been validly
transferred by the applicable Originator directly to Borrower under and in
accordance with the Receivables Sale Agreement, and Borrower has good and
marketable title thereto free and clear of any Adverse Claim (except as created
under this Agreement).

"Eligible Receivables Net Balance"
 means
the total Outstanding Balance of Eligible Receivables less the Cash Discount
Reduction.

"ERISA" means the Employee
Retirement Income Security Act of 1974, as amended from time to time, and any
rule or regulation issued thereunder.

"ERISA Affiliate" means any trade or
business (whether or not incorporated) under common control with the
Performance Guarantor within the meaning of Section 414(b) or (c) of the Code
(and Sections 414(m) and (o) of the Code for purposes of provisions relating to
Section 412 of the Code).

"Event of Bankruptcy" shall be
deemed to have occurred with respect to a Person if either:

(a) a case or other proceeding shall be commenced,
without the application or consent of such Person, in any court, seeking the
liquidation, reorganization, debt arrangement, dissolution, winding up, or
composition or readjustment of debts of such Person, the appointment of a
trustee, receiver, custodian, liquidator, assignee, sequestrator or the like
for such Person or all or substantially all of its assets, or any similar
action with respect to such Person under any law relating to bankruptcy,
insolvency, reorganization, winding up or composition or adjustment of debts,
and such case or proceeding shall continue undismissed, or unstayed and in
effect, for a period of 60 consecutive days; or an order for relief in respect
of such Person shall be entered in an involuntary case under the federal
bankruptcy laws or other similar laws now or hereafter in effect; or

53

(b) such Person shall commence a voluntary case or
other proceeding under any applicable bankruptcy, insolvency, reorganization,
debt arrangement, dissolution or other similar law now or hereafter in effect,
or shall consent to the appointment of or taking possession by a receiver,
liquidator, assignee, trustee (other than a trustee under a deed of trust,
indenture or similar instrument), custodian, sequestrator (or other similar
official) for, such Person or for any substantial part of its property, or
shall make any general assignment for the benefit of creditors, or shall be
adjudicated insolvent, or admit in writing its inability to pay its debts
generally as they become due, or, if a corporation or similar entity, its board
of directors shall vote to implement any of the foregoing.

 

"Facility Termination Date" means
the earlier of (i) the Liquidity Termination Date and (ii) the Amortization
Date.

"Federal Bankruptcy Code" means
Title 11 of the United States Code entitled "Bankruptcy," as amended and any
successor statute thereto.

"Federal Funds Effective Rate"
means, for any day, the rate per annum
(rounded upward, if necessary, to the next higher 1/100th of 1%)
equal to the weighted average of the rates on overnight federal funds
transactions with members of the Federal Reserve System arranged by federal
funds brokers on such day, as published by the Federal Reserve Bank of New York
on the Business Day next succeeding such day, provided that (i) if the day for
which such rate is to be determined is not a Business Day, the Federal Funds
Effective Rate for such day shall be such rate on such transactions on the next
preceding Business Day as so published on the next succeeding Business Day, and
(ii) if such rate is not so published for any day, the Federal Funds Effective
Rate for such day shall be the average rate charged to Wachovia on such day on
such transactions, as determined by Wachovia.

"Fee Letter" means that certain
letter agreement dated as of August 4, 2003 between Borrower and the Agents, as
it may be amended, amended and restated, or otherwise modified and in effect
from time to time.

"Final Payout Date" means the date
on which all Obligations have been paid in full and the Aggregate Commitment
has been terminated.

"Finance Charges" means, with
respect to a Contract, any finance, interest, late payment charges or similar
charges owing by an Obligor pursuant to such Contract.

"Foreign Currency Reserve" means, on any
date of determination, an amount equal to 15% of the spot market
Dollar-equivalent of all Eligible Receivables otherwise included in the Net
Pool Balance which are denominated in Canadian Dollars.

"Funding Agreement" means (i) this
Agreement, (ii) a Liquidity Agreement and (iii) any other agreement or
instrument executed by any Funding Source with or for the benefit of a Conduit.

54

"Funding Source" means (i) any
Liquidity Bank or (ii) any insurance company, bank or other funding entity
providing liquidity, credit enhancement or back-up purchase support or
facilities to a Conduit.

"GAAP" means generally accepted
accounting principles in effect in the United States of America applied on a
basis consistent with the most recent audited consolidated financial statements
of Borrower and/or Servicer as of the date of determination (except for changes concurred in by the
Borrower's independent public accountants or otherwise required by a change in
GAAP).

"Indebtedness" of a Person means
such Person's (i) obligations for borrowed money, (ii) obligations representing
the deferred purchase price of property or services (other than accounts
payable arising in the ordinary course of such Person's business payable on
terms customary in the trade), (iii) obligations, whether or not assumed, secured
by liens or payable out of the proceeds or production from property now or
hereafter owned or acquired by such Person, (iv) obligations which are
evidenced by notes, acceptances, or other instruments, (v) capitalized lease
obligations, (vi) net liabilities under interest rate swap, exchange or cap
agreements, (vii) Contingent Obligations and (viii) liabilities in respect of
unfunded vested benefits under plans covered by Title IV of ERISA.

"Independent Director" means, with
respect to Borrower, a member of the Board of Directors of Borrower (i) who is
not an employee, or a beneficial owner, directly or indirectly of 10% or more
of any equity interest in Borrower or any Affiliate thereof, and who is not
related by blood, marriage or adoption with any of the foregoing Persons; (ii)
who has not been an employee of Borrower or any Affiliate in the last five
years; (iii) who is not affiliated with, or employed by, any Person providing
services to, any of Borrower's significant customers or suppliers; (iv) who is
not affiliated with any tax exempt or other organization that receives
significant contributions from Borrower or any of its Affiliates; and (v) who
has not provided and is not providing directly or indirectly, whether or not
through any related corporation, partnership, limited liability company,
limited liability partnership or other Person, legal, accounting or investment
banking services for Borrower or any Affiliate.  A Person that otherwise meets the foregoing qualifications shall
not be precluded from serving as an Independent Director by virtue of his or
her service as a director of any direct or indirect parent of Borrower, or if
he or she is also a director of a single-purpose, bankruptcy-remote, entity
that is an Affiliate of Mohawk Industries, Inc. with a certificate or articles
of incorporation substantially similar to Borrower's Amended and Restated
Certificate of Incorporation.

"Interest" means for each respective
Interest Period relating to Loans of the Liquidity Banks, an amount equal to the
product of the applicable Interest Rate for each Loan multiplied by the
principal of such Loan for each day elapsed during such Interest Period,
annualized on a 360 day basis.

"Interest Period" means, with
respect to any Loan held by a Liquidity Bank:

(a)            if
Interest for such Loan is calculated on the basis of the LIBO Rate, a period of
one, two, three or six months, or such other period as may be mutually
agreeable to the applicable Co-Agent and Borrower, commencing on a Business Day
selected by Borrower or such Co-Agent pursuant to this Agreement.  Such Interest Period shall end on the day in
the applicable succeeding calendar month which corresponds numerically to the
beginning day of such Interest Period, provided, however, that if there is
no such numerically corresponding day in such succeeding month, such Interest
Period shall end on the last Business Day of such succeeding month; or

55

(b)            if
Interest for such Loan is calculated on the basis of the Alternate Base Rate, a
period commencing on a Business Day selected by Borrower and agreed to by the
applicable Co-Agent, provided that no such period shall
exceed one month.

If any Interest Period would end on a day which is
not a Business Day, such Interest Period shall end on the next succeeding
Business Day, provided, however, that in the case of Interest Periods
corresponding to the LIBO Rate, if such next succeeding Business Day falls in a
new month, such Interest Period shall end on the immediately preceding Business
Day.  In the case of any Interest Period
for any Loan which commences before the Amortization Date and would otherwise
end on a date occurring after the Amortization Date, such Interest Period shall
end on the Amortization Date.  The
duration of each Interest Period which commences after the Amortization Date
shall be of such duration as selected by the applicable Co-Agent.

"Interest Rate" means, with respect
to each Loan of the Liquidity Banks, the LIBO Rate, the Alternate Base Rate or
the Default Rate, as applicable.

"Interest Reserve" means, as of any
Cut-Off Date, the product (expressed as a percentage) of (i) 1.5 times
(ii) the Alternate Base Rate times (iii) a fraction the numerator of
which is the 12-month high Days Sales Outstanding and the denominator of which
is 360.

"Invoice"  means any paper or
electronic invoice evidencing any Receivable.

"Lender" means each Conduit and each
Liquidity Bank.

"LIBO Rate" means, for any Interest
Period, the rate per annum determined on the basis of the offered rate for
deposits in U.S. dollars of amounts equal or comparable to the principal amount
of the related Loan offered for a term comparable to such Interest Period,
which rates appear on a Bloomberg L.P. terminal, displayed under the address "US0001M <Index> Q <Go>"
effective as of 11:00 A.M., London time, two Business Days prior to the first
day of such Interest Period, provided that if no such offered
rates appear on such page, the LIBO Rate for such Interest Period will be the
arithmetic average (rounded upwards, if necessary, to the next higher 1/100th
of 1%) of rates quoted by not less than three (3) major banks in New York, New
York, selected by the applicable Co-Agent, at approximately 10:00 a.m.(New York
time), two Business Days prior to the first day of such Interest Period, for
deposits in U.S. dollars offered by leading European banks for a period
comparable to such Interest Period in an amount comparable to the principal
amount of such Loan, divided by (b) one minus the maximum aggregate reserve
requirement, if any (including all basic, supplemental, marginal or other
reserves) which is imposed against the applicable Co-Agent in respect of
Eurocurrency liabilities, as defined in Regulation D of the Board of Governors
of the Federal Reserve System as in effect from time to time (expressed as a
decimal), applicable to such Interest Period plus (ii) the Applicable Margin per annum.  The LIBO Rate shall be rounded, if necessary, to the next higher
1/16 of 1%.

56

"LIBO Rate Loan"  
means a Loan which
bears interest at the LIBO Rate.

"Liquidity Agreements" means the
Liquidity between the Conduit of any Group and the Liquidity Banks of such
Group.

"Liquidity Banks" means, with
respect to each Group, the banks or other financial institutions and their
respective successors and permitted assigns under each Group's Liquidity
Agreement.

"Liquidity Commitment"  
means, as to
each Liquidity Bank in any Group, its commitment to such Group's Conduit under
the Liquidity Agreements, (which shall equal 102% of such Group's Percentage of
the Aggregate Commitment hereunder).

"Liquidity Funding"  
means (a) a
purchase made by any Liquidity Bank pursuant to its Liquidity Commitment of all
or any portion of, or any undivided interest in, an applicable Conduit's Loans,
or (b) any Loan made by a Liquidity Bank in lieu of such Conduit pursuant to
Section 1.1.

"Liquidity Termination Date"  
means,
as to any of the Conduits, except as otherwise set forth in this Agreement, the
earlier to occur of the following:

(a) the date on which such Conduit's Liquidity
Banks' Liquidity Commitments expire, cease to be available to such Conduit or
otherwise cease to be in full force and effect unless each other Conduit and
its Group otherwise consent; or

(b) the date on which a Downgrading Event with
respect to a Liquidity Bank shall have occurred and been continuing for not
less than 30 days, and either (i) the Downgraded Liquidity Bank shall not have
been replaced by an Eligible Assignee pursuant to the applicable Liquidity
Agreement, or (ii) the Liquidity Commitment of such Downgraded Liquidity Bank
shall not have been funded or collateralized in such a manner that will avoid a
reduction in or withdrawal of the credit rating applied to the Commercial Paper
to which such Liquidity Agreement applies by any of the rating agencies then
rating such Commercial Paper.

"Loan"  means any loan made by a
Lender to Borrower pursuant to this Agreement (including, without limitation,
any Liquidity Funding).  Each Loan shall
either be a CP Rate Loan, an Alternate Base Rate Loan or a Eurodollar Rate
Loan, selected in accordance with the terms of this Agreement.

"Loan Parties" has the meaning set
forth in the preamble to this Agreement.

"Lock-Box" means each locked postal
box with respect to which a bank has been granted exclusive access for the
purpose of retrieving and processing payments made on the Receivables.

57

"Loss Reserve" means, as of any
Cut-Off Date, the product (expressed as a percentage) of (a) 2.0, times (b) the
highest three-month rolling average Default Ratio during the 12 Calculation
Periods ending on such Cut-Off Date, times (c) the Default Horizon Ratio as of
such Cut-Off Date.

"Material Adverse Effect" means a
material adverse effect on (i) the financial condition of any Loan Party and
its Subsidiaries, taken as a whole (ii) the ability of any Loan Party to
perform its obligations under this Agreement or the Performance Guarantor to
perform its obligations under the Performance Undertaking, (iii) the legality,
validity or enforceability of this Agreement, the Receivables Sale Agreement,
the Servicing Agreement or any Collection Account Agreement, (iv) the
Administrative Agent's security interest, for the benefit of the Secured
Parties, in the Receivables generally or in any significant portion of the
Receivables, the Related Security or the Collections with respect thereto, or
(v) the collectibility of the Receivables generally or of any significant
portion of the Receivables.

"Mohawk Carpet"  
means Mohawk Carpet
Corporation, a Delaware corporation.

"Mohawk Credit Agreement"  
means that
certain Fifth Amended and Restated Credit Agreement dated as of November 23,
1999, among Mohawk Industries, Inc., First Union National Bank, SunTrust Bank,
Wachovia Bank, National Association, and the other banks from time to time
party thereto, as amended, amended and restated or otherwise modified from time
to time, regardless of whether the same remains in effect.

"Mohawk Distribution"  
means Mohawk
Carpet Distribution, LP, a Delaware limited partnership.

"Mohawk Resources"  
means Mohawk
Resources, Inc., a Delaware corporation.

"Mohawk Servicing"  
has the meaning
specified in the preamble to this Agreement.

"Monthly Report" means a report, in
substantially the form of Exhibit IX hereto (appropriately completed),
furnished by the Servicer to the Administrative Agent pursuant to Section 8.5.

"Monthly Reporting Date"  
means the
18th day of each month after the date of this Agreement (or if any such day is
not a Business Day, the next succeeding Business Day thereafter).

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

"Net Pool Balance" means, at any
time, (i) the aggregate Eligible Receivables Net Balance at such time minus
(ii) the aggregate amount by which the Eligible Receivables Net Balance of all
Eligible Receivables of each Obligor and its Affiliates exceeds the Obligor
Concentration Limit for such Obligor and minus (iii) the Foreign
Currency Reserve as of the last day of the most recent Calculation Period for
which a Monthly Report has been delivered.

58

"Net Worth" means, as of the last
Business Day of each Calculation Period preceding any date of determination,
net worth determined in accordance with GAAP.

"Obligations" means, at any time,
any and all obligations of either of the Loan Parties or the Performance
Guarantor to any of the Secured Parties arising under or in connection with the
Transaction Documents, whether now existing or hereafter arising, due or
accrued, absolute or contingent, including, without limitation, obligations in
respect of Aggregate Principal, CP Costs, Interest, fees under the Fee Letter,
Broken Funding Costs and Indemnified Amounts.

"Obligor" means a Person obligated
to make payments on a Receivable.

"Obligor Concentration Limit" means,
at any time, in relation to the aggregate Outstanding Balance of Receivables
owed by any single Obligor and its Affiliates (if any), the applicable
concentration limit shall be determined as follows for Obligors who have short
term unsecured debt ratings currently assigned to them by S&P and Moody's
(or in the absence thereof, the equivalent long term unsecured senior debt
rating noted in the table below), the applicable concentration limit shall be
determined according to the following table:

	
  

  S&P Short-term Rating

  	
  

  S&P Equivalent Long-term Rating

  	
  

  Moody's Short-term Rating

  	
  Moody's Equivalent Long-term Rating

  	
  Allowable % of Eligible Receivables Net Balance

  
	
  A-1+

  	
  AA- or higher

  	
  P-1

  	
   

  	
  10%

  
	
  A-1

  	
  A+, A

  	
  P-1

  	
  A2 or higher

  	
  8%

  
	
  A-2

  	
  A-, BBB+

  	
  P-2

  	
  A3, Baa1

  	
  6%

  
	
  A-3

  	
  BBB, BBB-

  	
  P-3

  	
  Baa2, Baa3

  	
  3%

  
	
  Below A-3 or Unrated

  	
  Less than investment grade or Unrated

  	
  Below P-3 or Unrated

  	
  Less than investment grade or Unrated

  	
  

  
  2%

  

; provided,
however, that (a) if any Obligor has a split rating, the applicable
rating will be the lower of the two, (b) if any Obligor is not rated by both
S&P and Moody's, the applicable Obligor Concentration Limit shall
be the one set forth in the last line of the table above, and (c) subject to
satisfaction of the Rating Agency Condition and/or an increase in the
percentage set forth in clause (a)(i) of the definition of "Required Reserve," upon
Borrower's request from time to time, the Administrative Agent may agree to a
higher percentage of the Eligible Receivables Net Balance for a particular
Obligor and its Affiliates (each such higher percentage, a "Special Concentration Limit"),
it being understood that any Special Concentration Limit may be cancelled by
the Administrative Agent upon not less than ten (10) Business Days' prior
written notice to the Loan Parties.

"Originator" means each of Mohawk
Distribution, Dal-Tile Corporation, a Delaware corporation and each other Originator
that becomes a party to the Receivables Sale Agreement pursuant to the terms
thereof, in each case, in its capacity as a seller under the Receivables Sale
Agreement.

59

"Other Records" means, with respect
to any Receivable:  (a) all Contracts
and (b) all other documents, books, records and other information (including,
without limitation, computer programs, tapes, disks, punch cards, data
processing software and related property and rights) relating to the
creditworthiness of any Obligor in respect thereof.

"Outstanding Balance" of any
Receivable at any time means the then outstanding principal balance thereof.

"Participant" has the meaning set
forth in Section 12.2.

"PBGC" means the Pension Benefit
Guaranty Corporation, or any successor thereto.

"Pension Plan" means a pension plan
(as defined in Section 3(2) of ERISA) subject to Title IV of ERISA which
Performance Guarantor sponsors or maintains, or to which it makes, is making,
or is obligated to make contributions, or in the case of a multiple employer
plan (as described in Section 4064(a) of ERISA) has made contributions at any
time during the immediately preceding five plan years.

"Percentage" means, for each Group on any
date of determination, the ratio which the sum of the Commitments for all Liquidity
Banks in that Group bears to the Aggregate Commitment.

"Performance Guarantor" means Mohawk
Industries, Inc., a Delaware corporation, and its successors.

"Performance Undertaking" means that
certain Amended and Restated Performance Undertaking, dated as of the date
hereof, by Performance Guarantor in favor of Borrower, substantially in the
form of Exhibit X, as the same may be amended, restated or otherwise modified
from time to time.

"Person" means an individual,
partnership, corporation (including a business trust), limited liability
company, joint stock company, trust, unincorporated association, joint venture
or other entity, or a government or any political subdivision or agency
thereof.

"Plan" means an employee benefit
plan (as defined in Section 3(3) of ERISA) which Performance Guarantor or any
of its ERISA Affiliates sponsors or maintains or to which Performance Guarantor
or any of its ERISA Affiliates makes, is making, or is obligated to make
contributions and includes any Pension Plan, other than a Plan maintained
outside the United States primarily for the benefit of Persons who are not U.S.
residents.

"Pooled Commercial Paper" means, if
applicable, Commercial Paper notes of a Conduit subject to any particular
pooling arrangement by such Conduit, but excluding Commercial Paper issued by
such Conduit for a tenor and in an amount specifically requested by any Person
in connection with any agreement effected by such Conduit.

60

"Prime Rate" means a rate per annum equal to the prime rate of interest announced from time
to time by Wachovia (which is not necessarily the lowest rate charged to any
customer), changing when and as said prime rate changes.

"Pro Rata Share" means, with respect
to each Group on any date of determination, the ratio which the Liquidity
Commitment of a Liquidity Bank in such Group bears to the sum of the Liquidity
Commitments of all Liquidity Banks in such Group.

"Proposed Reduction Date" has the
meaning set forth in Section 1.3.

"Purchasing Liquidity Bank" has the
meaning set forth in Section 12.1(b).

"Rating Agency Condition" means, if
applicable, that a Conduit has received written notice from S&P and Moody's
or any other rating agency then rating such Conduit's Commercial Paper that the
execution and delivery of, or an amendment, a change or a waiver of, this
Agreement or the Receivables Sale Agreement will not result in a withdrawal or
downgrade of the then current ratings on such Conduit's Commercial Paper.

"Receivable" means all indebtedness
and other obligations owed to any Originator at the time it arises and before
giving effect to any transfer or conveyance under the Receivables Sale
Agreement, arising in connection with the sale of goods or the rendering of
services by such Originator or a predecessor, including, without limitation,
any indebtedness, obligation or interest constituting an account, chattel
paper, instrument, payment intangible or general intangible, if any, together
with the obligation to pay any Finance Charges, if any, with respect thereto
and all proceeds thereof;  provided,
however, in no event shall the term "Receivable" include any Factored Receivable (as defined in the
Receivables Sale Agreement), any Excluded Receivable (as defined in the
Receivables Sale Agreement ) or any Receivablecoming into existence
after the Facility Termination Date. 
For the purposes of this Agreement, indebtedness and other rights and
obligations arising from any one transaction, including, without limitation,
indebtedness and other rights and obligations represented by an individual
invoice, shall constitute a Receivable separate from a Receivable consisting of
the indebtedness and other rights and obligations arising from any other
transaction; provided further, that any indebtedness, rights or obligations
referred to in the immediately preceding sentence shall be a Receivable
regardless of whether the account debtor or Borrower treats such indebtedness,
rights or obligations as a separate payment obligation.

"Receivables Sale Agreement" means
that certain Amended and Restated Receivables Purchase and Sale Agreement,
dated as of the date hereof, among the Originators and Borrower, as the same
may be amended, restated or otherwise modified from time to time.

"Records" means, with respect to any
Receivable, all Contracts and other documents, books, records and other
information (including, without limitation, computer programs, tapes, disks,
punch cards, data processing software and related property and rights) relating
to such Receivable, any Related Security therefor and the related Obligor.

"Reduction Notice" has the meaning
set forth in Section 1.3.

61

"Regulatory Change" means, with
respect to a Funding Source, any change about which such Funding Source learns
after the date such Funding Source is first entitled to the benefits of Sections
10.2 hereof in United States (federal, state or municipal) or foreign laws,
regulations (including Regulation D) or accounting principles or the adoption
or making after such date of any interpretations, directives or requests
applying to a class of banks (including the Liquidity Banks) of or under any
United States (federal, state or municipal) or foreign laws, regulations
(whether or not having the force of law) or accounting principles by any court,
governmental or monetary authority, or accounting board or authority (whether
or not part of government) charged with the establishment, interpretation or
administration thereof.  For the
avoidance of doubt, any interpretation of Accounting Research Bulletin No. 51
by the Financial Accounting Standards Board shall constitute a Regulatory
Change.

"Related Commercial Paper" means,
for any period with respect to TPFC, any Commercial Paper of TPFC issued or
deemed issued for purposes of financing or maintaining any Loan by TPFC
(including any discount, yield, or interest thereon) outstanding on any day
during such period.

"Related Security" means, with
respect to any Receivable:

(i)            all of the applicable Originator's interest, if any, in
the goods (including returned or repossessed goods), the sale of which by such
Originator gave rise to such Receivable,

(ii)            all other security interests or liens and property
subject thereto from time to time, if any, purporting to secure payment of such
Receivable, together with all financing statements and security agreements
describing any collateral securing such Receivable,

(iii)            all guaranties, letters of credit, credit insurance and
other agreements or arrangements of whatever character from time to time
supporting payment of such Receivable,

(iv)            all service contracts and agreements, if any, associated
with such Receivable,

(v)            all Collections and Collection Records related to such
Receivable,

(vi)            all of Borrower's right, title and interest in, to and
under the Receivables Sale Agreement in respect of such Receivable,

(vii)            all of Borrower's right, title and interest in, to and
under the Performance Undertaking,

(viii)            all of Borrower's right, title and interest in, to and
under the Servicing Agreement,

(ix)            all of Borrower's right, title and interest in and to the
Demand Advances, and

62

(x)            all proceeds and insurance proceeds of any of the
foregoing or of any Receivable.

"Required Capital Amount" means, as
of any date of determination, an amount equal to the greater of (a) 3% of the
Aggregate Commitment, and (b) the product of (i) 1.5 times the product of the
Default Ratio times the Default Horizon Ratio, each as determined from the most recent Monthly Report received
from the Servicer, and (ii) the Outstanding Balance of all Receivables as of
such date, as determined from the most recent Monthly Report received from the
Servicer.

"Required Liquidity Banks" means, at
any time, (i) for each Group (other than as set forth in clause (ii) of this
definition), Liquidity Banks in such Group with Commitments in excess of 66-2/3%
of such Group's Percentage of the Aggregate Commitment and (ii) for purposes of
Section 11.10 and 14.1(b), 66-2/3% of the Aggregate
Commitment of the Liquidity Banks in all Groups.

"Required Notice Period" means the
number of days required notice set forth below applicable to the Aggregate
Reduction indicated below:

	
  Aggregate
  Reduction

  	
  Required
  Notice Period

  
	
  < $100,000,000

  	
  2 Business Days

  
	
  $100,000,000 +

  	
  5 Business Days

  

"Required Reserve"  
means, on any day
during a Calculation Period, the product of (a) the greater of (i) the Required
Reserve Factor Floor and(ii) the
sum of the Loss Reserve, the Interest Reserve, the Dilution Reserve and the
Servicing Reserve, times (b) the Net Pool Balance as of the Cut-Off Date
immediately preceding such Calculation Period.

"Required Reserve Factor Floor"  
means
the sum (expressed as a percentage) of (a)8.0% plus (b) 3.0%, plus (c) 2.5%
plus (d) the product of (i) the Adjusted Dilution Ratio and (ii) the Dilution
Horizon Ratio.

"Responsible Financial Officer"  
means
any of Parent's or any Loan Party's chief financial officer, vice president
& corporate controller or vice president & treasurer, acting singly.

"Restricted Junior Payment" means
(i) any dividend or other distribution, direct or indirect, on account of any
shares of any class of capital stock of Borrower now or hereafter outstanding,
except a dividend payable solely in shares of that class of stock or in any
junior class of stock of Borrower, (ii) any redemption, retirement, sinking
fund or similar payment, purchase or other acquisition for value, direct or
indirect, of any shares of any class of capital stock of Borrower now or
hereafter outstanding, (iii) any payment or prepayment of principal of,
premium, if any, or interest, fees or other charges on or with respect to, and
any redemption, purchase, retirement, defeasance, sinking fund or similar
payment and any claim for rescission with respect to any Indebtedness of
Borrower (other than the Obligations), (iv) any payment made to redeem,
purchase, repurchase or retire, or to obtain the surrender of, any outstanding
warrants, options or other rights to acquire shares of any class of capital
stock of Borrower now or hereafter outstanding, and (v) any payment of
management fees by Borrower (except for the Servicing Fee and reasonable
management fees to the Performance Guarantor or any of its Affiliates in
payment of actual management services performed).

63

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

"Secured Parties" means the Agents
and the Lenders.

"Servicer" means at any time the
Person (which may be the Administrative Agent) then authorized pursuant to
Article VIII to service, administer and collect Receivables.

"Servicing Agreement"
 means that
certain Amended and Restated Servicing Agreement dated as of August 4, 2003 by
and between the Borrower and Mohawk Servicing, Inc., as Servicer, providing for
the collection and servicing of all Receivables held by the Borrower.

"Servicing Fee" means, for each
Calculation Period:

(a) an amount equal to the greater of (i) 1.0% per annum (or, at any time while Mohawk
Servicing or one of its Affiliates is the Servicer, such lesser percentage as
may be agreed between Borrower and the Servicer on an arms' length basis based
on then prevailing market terms for similar services), times the aggregate
Outstanding Balance of all Receivables at the close of business on the Cut-Off
Date immediately preceding such Calculation Period, times the product of the
actual number of days in such period and 1/360, and (ii) 105% of Servicer's
reasonable costs and expenses of performing its obligations under this
Agreement during the preceding Calculation Period; or

(b) on and after the Servicer's reasonable request
made at any time when Mohawk Servicing or one of its Affiliates is no longer
acting as Servicer hereunder, an alternative amount specified by the successor
Servicer that is commercially reasonable and not exceeding the greater of (i)
110% of such Servicer's reasonable costs and expenses of performing its
obligations under this Agreement during the preceding Calculation Period, and
(ii) the amounts specified in clause (a)(i) above.

Any Servicing Fee computed
hereunder shall be in lieu of and not in addition to any Servicing Fee payable
under the Servicing Agreement.

"Servicing Fee Rate" means a rate of
1% per annum (or, at any time while
Mohawk Servicing or one of its Affiliates is the Servicer, such lesser
percentage as may be agreed between Borrower and the Servicer on an arms'
length basis based on then prevailing market terms for similar services).

"Servicing Reserve" means, for any
Calculation Period, the product (expressed as a percentage) of (a) the
Servicing Fee Rate (expressed as a percentage), and (b) a fraction, the
numerator of which is the highest Days Sales Outstanding calculated for each of
the most recent 12 Calculation Periods and the denominator of which is 360.

64

"Settlement Date" means (A) the 2nd
Business Day after each Monthly Reporting Date, and (B) the last day of the
relevant Interest Period in respect of each Loan of the applicable Liquidity
Banks.

"Settlement Period" means (A) in
respect of each Loan of a Conduit, the immediately preceding Calculation
Period, and (B) in respect of each Loan of the applicable Liquidity Banks, the
entire Interest Period of such Loan.

"STCM"  means SunTrust Capital
Markets, Inc., a Tennessee corporation, and its successors and assigns.

"Subordinated Note" means the
Amended and Restated Subordinated Note dated as of the date hereof issued by
the Borrower in favor of Mohawk Resources, which amends and restates the
Subordinated Note dated October 25, 2000 issued by Borrower in favor of Mohawk
Resources.

"Subsidiary" of a Person means (i)
any corporation more than 50% of the outstanding securities having ordinary
voting power of which shall at the time be owned or controlled, directly or
indirectly, by such Person or by one or more of its Subsidiaries or by such
Person and one or more of its Subsidiaries, or (ii) any partnership, association,
limited liability company, joint venture or similar business organization more
than 50% of the ownership interests having ordinary voting power of which shall
at the time be so owned or controlled.

"Tax Code"  means the Internal
Revenue Code of 1986, as the same may be amended from time to time.

"Terminating Tranche" has the
meaning set forth in Section 4.3(b).

"TPFC" has the meaning set forth in the
preamble to this Agreement.

"TPFC Agent" has the meaning set forth in
the preamble to this Agreement.

"TPFC
Commercial Paper Rate" means, for any
CP Tranche Period of TPFC, a rate per
annum equal to the sum of (i) the rate or, if more than one rate, the
weighted average of the rates, determined by converting to an interest-bearing
equivalent rate per annum the
discount rate (or rates) at which TPFC's Related Commercial Paper outstanding
during such CP Tranche Period has been or may be sold by any placement agent or
commercial paper dealer selected by the TPFC Agent, plus (ii) the
commissions and charges charged by such placement agent or commercial paper
dealer with respect to such Related Commercial Paper, expressed as a percentage
of the face amount thereof and converted to an interest-bearing equivalent rate
per annum.

"TPFC Group" has the meaning set forth in
the preamble to this Agreement.

65

"TPFC Liquidity
Agreement"  means that certain
liquidity asset purchase agreement dated as of the date hereof by and among
TPFC, the TPFC Liquidity Banks and STCM, as TPFC Agent and liquidity agent, as
the same may be amended, restated and/or otherwise modified from time to time.

"TPFC Liquidity
Banks"  means SunTrust Bank and its
successors and assigns under the TPFC Liquidity Agreement.

"Transaction Documents" means,
collectively, this Agreement, each Borrowing Notice, the Receivables Sale
Agreement, the Subordinated Note, the Servicing Agreement, each Collection Account
Agreement, the Performance Undertaking, the Fee Letter and each Monthly Report.

"UCC" means the Uniform Commercial
Code as from time to time in effect in the specified jurisdiction.

"Unmatured Amortization Event" means
an event which, with the passage of time or the giving of notice, or both,
would constitute an Amortization Event.

"Wachovia" means Wachovia Bank,
National Association in its individual capacity and its capacity as a Co-Agent
and as Administrative Agent.

"Weighted Average
Credit Percentage"  means, on any date
of determination, the percentage determined pursuant to the following formula:

	

  	

  	

  	
   

  	

  	

  	

  
	

  	
   100% x  

  	

  	
  WACT

  	

  	

  	

  
	

  	

  	
  30

  	

  	

  	

  
	

  	

  	

  	
   

  	

  	

  	

  

where:

WACT= the Weighted Average Credit Terms for the most
recent Calculation Period."Weighted Average Credit
Terms"  means, for any Calculation
Period of determination, the weighted average of payment terms granted in
invoices for Receivables generated during such Calculation Period.

All accounting terms not specifically
defined herein shall be construed in accordance with GAAP.  All terms used in Article 9 of the UCC in
the State of Georgia, and not specifically defined herein, are used herein as
defined in such Article 9.

66

EXHIBIT II

FORM OF BORROWING NOTICE

---

Mohawk
Factoring, Inc.

BORROWING NOTICE

dated ______________, 20__

for Borrowing on ________________, 20__

 

[Applicable Co-Agent]

Attention: 
[_____________________]

Ladies and Gentlemen:

Reference is made to the Amended and Restated Credit and
Security Agreement dated as of August 4, 2003 (as amended, supplemented or
otherwise modified from time to time, the "Credit Agreement") among Mohawk
Factoring, Inc. (the "Borrower"), Mohawk Servicing, Inc.,
as initial Servicer, Blue Ridge Asset Funding Corporation, Three Pillars
Funding Corporation, each other Conduit party from time to time thereto,
SunTrust Capital Markets, Inc., individually and as co-agent and Wachovia Bank
National Association, individually, as co-agent, each other co-agent from time
to time party thereto and as Administrative Agent for the Agents and the
Lenders.  Capitalized terms defined in
the Credit Agreement are used herein with the same meanings.

1.  The Borrower
hereby certifies, represents and warrants to the Agents and the Lenders that on
and as of the Borrowing Date (as hereinafter defined):

(a)  all
applicable conditions precedent set forth in Article VI of the Credit Agreement
have been satisfied;

(b)  each of
its representations and warranties contained in Section 5.1 of the Credit
Agreement will be true and correct, in all material respects, as if made on and
as of the Borrowing Date (except to the extent such representation or warranty
expressly relates to an earlier date);

(c)  no event
will have occurred and is continuing, or would result from the requested
Advance, that constitutes an Amortization Event or Unmatured Amortization
Event;

(d)  the
Facility Termination Date has not occurred; and

67

(e)  after
giving effect to the Loans comprising the Advance requested below, the
Aggregate Principal will not exceed the Borrowing Limit.

2.  The Borrower
hereby requests that the Conduits (or their respective Liquidity Banks) make an
Advance on ___________, 20__ (the "Borrowing Date") as follows:

(a) Aggregate Amount of Advance:  $_____________

(i)            Blue Ridge Group's Percentage of
Advance:  $_______________

(ii)            TPFC Group's Percentage of
Advance:  $___________________

(iii)            [Other Group's Percentage of
Advance:  $___________________]

(b) If the Advance is not funded by the applicable
Conduits, Borrower requests that the Liquidity Banks for such Conduit's Group
make an Alternate Base Rate Loan that converts into LIBO Rate Loan with an
Interest Period of _____ months on the third Business Day after the Borrowing
Date).

3.  Please disburse
the proceeds of the Loans as follows:

(i)            Blue Ridge Group:  [Apply
$________ to payment of principal and interest of existing Loans due on the
Borrowing Date].  [Apply
$______ to payment of fees due on the Borrowing Date]. [Wire transfer
$________ to account no. ________ at ___________ Bank, in [city, state], ABA No.
__________, Reference:  ________].

(ii)         TPFC
Group:  [Apply $________ to payment of principal and interest of existing
Loans due on the Borrowing Date].  [Apply
$______ to payment of fees due on the Borrowing Date]. [Wire transfer $________
to account no. ________ at ___________ Bank, in [city, state], ABA No.
__________, Reference:  ________].

(iii)         [Other
Group]:  [Apply $________ to payment of principal and interest of existing
Loans due on the Borrowing Date].  [Apply
$______ to payment of fees due on the Borrowing Date]. [Wire transfer
$________ to account no. ________ at ___________ Bank, in [city, state], ABA No.
__________, Reference:  ________].

IN WITNESS WHEREOF,  the Borrower has
caused this Borrowing Request to be executed and delivered as of this ____ day
of ___________, _____.

MOHAWK FACTORING, INC., as
Borrower

By:  _________________________________

Name:

Title:

68

EXHIBIT III

 

PLACES OF BUSINESS OF THE LOAN PARTIES;
LOCATIONS OF RECORDS; FEDERAL EMPLOYER IDENTIFICATION NUMBER(S) ORGANIZATIONAL
IDENTIFICATION NUMBER

Places of Business and Location of Collection Records:

 

Mohawk Factoring, Inc.

300 Delaware Ave.

Suite 1273 C

Wilmington, DE  19801

Mohawk Servicing, Inc

235 Industrial Blvd.  

Chatsworth, GA 30705

Mohawk Servicing, Inc.  

160 S. Industrial Blvd.

Calhoun, GA 30703

Federal Employer Identification Number:

 

Mohawk Factoring, Inc.:

FEI #62-1719971

Organizational Identification Numbers:

Mohawk Factoring, Inc.: 
2814276

Legal, Trade and Assumed Names:

 

Mohawk Servicing Inc.:  

none

Mohawk Factoring, Inc.:  

            none

 

69

EXHIBIT IV

NAMES OF COLLECTION BANKS; COLLECTION
ACCOUNTS

	
   

  BORROWER'S

  LOCK-BOX

   

  	
   

  RELATED COLLECTION ACCOUNT OF BORROWER

  
	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   

70

	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   

71

EXHIBIT V

FORM OF COMPLIANCE CERTIFICATE

 

To:  Wachovia Bank,
National Association, as Administrative Agent

This Compliance Certificate is furnished pursuant to that
certain Amended and Restated Credit and Security Agreement dated as of August
4, 2003 among Mohawk Factoring, Inc. (the "Borrower"), Mohawk Servicing, Inc.
(the "Servicer"),
the Lenders party thereto, the Co-Agents party thereto and Wachovia Bank,
National Association, as administrative agent for such Co-Agents and such
Lenders (the "Agreement").

THE UNDERSIGNED HEREBY CERTIFIES THAT:

1.           I am the
duly elected _________________ and, accordingly, a Responsible Financial
Officer, of Borrower.

2.           I have
reviewed the terms of the Agreement and I have made, or have caused to be made
under my supervision, a detailed review of the transactions and conditions of
Borrower and its Subsidiaries during the accounting period covered by the
attached financial statements.

3.           The
examinations described in paragraph 2 did not disclose, and I have no knowledge
of, the existence of any condition or event which constitutes an Amortization
Event or Unmatured Amortization Event, as each such term is defined under the
Agreement, during or at the end of the accounting period covered by the
attached financial statements or as of the date of this Certificate[, except as set forth in paragraph 5
below].

4.            Schedule
I attached hereto sets forth financial data and computations evidencing the
compliance with certain covenants of the Agreement, all of which data and
computations are true, complete and correct.

[5.            Described below are the exceptions,
if any, to paragraph 3 by listing, in detail, the nature of the condition or
event, the period during which it has existed and the action which Borrower has
taken, is taking, or proposes to take with respect to each such condition or
event:  ____________________]

72

The foregoing certifications, together with the
computations set forth in Schedule I hereto and the financial statements
delivered with this Certificate in support hereof, are made and delivered as of
______________, 20__.

By:___________________________
                        Name:
                        Title:

           
 

           
 

73

SCHEDULE I TO COMPLIANCE CERTIFICATE

 

A.            Schedule
of Compliance as of __________, ____ with Section ___ of the Agreement.  Unless otherwise defined herein, the terms
used in this Compliance Certificate have the meanings ascribed thereto in the
Agreement.

This schedule relates to the month ended: _______________

74

EXHIBIT VI

FORM OF COLLECTION ACCOUNT AGREEMENT

COLLECTION ACCOUNT AGREEMENT

_____________, 200__

75

76

 

77

78

79

80

ANNEX A

FORM OF NOTICE

 

[On letterhead
of the Administrative Agent]

[Date]

[Collection Bank Name]

[Collection Bank Address]

Attn:  ____________________

Fax No. (___) ______________

            Re:           
 [Name
of current lockbox owner]/Mohawk Factoring, Inc.

Ladies and Gentlemen:

We
hereby notify you that we are exercising our rights pursuant to that certain
letter agreement dated ____________, 200___ (the "Letter Agreement")
among [Name of current Lockbox Owner], Mohawk Factoring, Inc., you and us, to
have the name of, and to have exclusive ownership and control of, account no.
__________ identified in the Letter Agreement (the "Lock-Box Account") maintained
with you, transferred to us.  The
Lock-Box Account will henceforth be a zero-balance account, and funds deposited
in the Lock-Box Account should be sent at the end of each day to the account
specified in Section 3(i) of the Letter Agreement, or as otherwise directed by
the undersigned.  You have further
agreed to perform all other services you are performing under the "Service
Agreement" (as defined in the Letter Agreement) on our behalf.

We
appreciate your cooperation in this matter.

Very truly yours,

WACHOVIA BANK, NATIONAL ASSOCIATION,  

as
Administrative Agent

By:__________________________

                                                                                    Title:

CC:            Mohawk
Factoring, Inc.

81

SCHEDULE 1

	
  

  Lock-Box Post Office Address

  
	

  
	

  
	

  
	

  
	

  
	

  
	

  
	

  
	

  
	

  
	

  
	

  

 

82

EXHIBIT VII

 

FORM OF ASSIGNMENT AGREEMENT

 

THIS ASSIGNMENT AGREEMENT (this "Assignment Agreement")
is entered into as of the ___ day of ____________, ____, by and between
_____________________ ("Assignor") and __________________ ("Assignee").

PRELIMINARY STATEMENTS

 

A.           This
Assignment Agreement is being executed and delivered in accordance with Section
12.1(b) of that certain Amended and Restated Credit and Security Agreement
dated as of August 4, 2003 by and among Mohawk Factoring, Inc., as Borrower,
Mohawk Servicing, Inc., as Servicer, Blue Ridge Asset Funding Corporation,
Three Pillars Funding Corporation, the other conduits from time to time party
thereto, SunTrust Bank, as an agent, the other administrative agents from time
to time party thereto, Wachovia Bank, National Association, as an agent and as
Administrative Agent, and the Liquidity Banks party thereto (as amended,
modified or restated from time to time, the "Credit and Security Agreement")
and that applicable Liquidity Agreement. 
Capitalized terms used and not otherwise defined herein are used with
the meanings set forth or incorporated by reference in the Credit and Security
Agreement.

B.            Assignor
is a Liquidity Bank party to the Credit and Security Agreement and its
Liquidity Agreement, and Assignee wishes to become a Liquidity Bank thereunder;
and

C.            Assignor
is selling and assigning to Assignee an undivided ____________% (the "Transferred
Percentage") interest in all of Assignor's rights and obligations under
the Transaction Documents and its Liquidity Agreement, including, without
limitation, Assignor's Commitment, Assignor's Liquidity Commitment and (if
applicable) Assignor's Loans as set forth herein.

AGREEMENT

 

The parties hereto hereby agree as follows:

1.                 
The sale, transfer and assignment effected by this Assignment
Agreement shall become effective (the "Effective Date") two (2) Business
Days (or such other date selected by the Agent in its sole discretion)
following the date on which a notice substantially in the form of Schedule II
to this Assignment Agreement ("Effective Notice") is delivered by
the applicable Co-Agent to the Conduit in the Assignor's Conduit Group,
Assignor and Assignee.  From and after
the Effective Date, Assignee shall be a Liquidity Bank party to the Credit and
Security Agreement for all purposes thereof as if Assignee were an original
party thereto and Assignee agrees to be bound by all of the terms and
provisions contained therein.

2.                 
If Assignor has no outstanding principal under the Credit and
Security Agreement or its Liquidity Agreement, on the Effective Date, Assignor
shall be deemed to have hereby transferred and assigned to Assignee, without
recourse, representation or warranty (except as provided in paragraph 6 below),
and the Assignee shall be deemed to have hereby irrevocably taken, received and
assumed from Assignor, the Transferred Percentage of Assignor's Commitment and
Liquidity Commitment and all rights and obligations associated therewith under
the terms of the Credit and Security Agreement and its Liquidity Agreement,
including, without limitation, the Transferred Percentage of Assignor's future
funding obligations under the Credit and Security Agreement and its Liquidity
Agreement.

83

3.                 
If Assignor has any outstanding principal under the Credit and
Security Agreement and its Liquidity Agreement, at or before 12:00 noon, local
time of Assignor, on the Effective Date Assignee shall pay to Assignor, in
immediately available funds, an amount equal to the sum of (i) the Transferred
Percentage of the outstanding principal of Assignor's Loans and, without duplication,
[Assignor's Percentage Interests] (as defined in its Liquidity
Agreement) (such amount, being hereinafter referred to as the "Assignee's
Principal"); (ii) all accrued but unpaid (whether or not then due)
Interest attributable to Assignee's Principal; and (iii) accruing but unpaid
fees and other costs and expenses payable in respect of Assignee's Principal
for the period commencing upon each date such unpaid amounts commence accruing,
to and including the Effective Date (the "Assignee's Acquisition Cost");
whereupon, Assignor shall be deemed to have sold, transferred and assigned to
Assignee, without recourse, representation or warranty (except as provided in
paragraph 6 below), and Assignee shall be deemed to have hereby irrevocably
taken, received and assumed from Assignor, the Transferred Percentage of
Assignor's Commitment, Liquidity Commitment, Loans (if applicable) and
Percentage Interests (if applicable) and all related rights and obligations
under the Transaction Documents and its Liquidity Agreement, including, without
limitation, the Transferred Percentage of Assignor's future funding obligations
under the Credit and Security Agreement and its Liquidity Agreement.

4.                 
Concurrently with the execution and delivery hereof, Assignor
will provide to Assignee copies of all documents requested by Assignee which
were delivered to Assignor pursuant to the Credit and Security Agreement or its
Liquidity Agreement.

5.                 
Each of the parties to this Assignment Agreement agrees that
at any time and from time to time upon the written request of any other party,
it will execute and deliver such further documents and do such further acts and
things as such other party may reasonably request in order to effect the
purposes of this Assignment Agreement.

6.                 
By executing and delivering this Assignment Agreement,
Assignor and Assignee confirm to and agree with each other, the Agent and the
Liquidity Banks as follows:  (a) other
than the representation and warranty that it has not created any Adverse Claim
upon any interest being transferred hereunder, Assignor makes no representation
or warranty and assumes no responsibility with respect to any statements,
warranties or representations made by any other Person in or in connection with
any of the Transaction Documents or its Liquidity Agreement or the execution,
legality, validity, enforceability, genuineness, sufficiency or value of
Assignee, the Credit and Security Agreement, its Liquidity Agreement or any
other instrument or document furnished pursuant thereto or the perfection,
priority, condition, value or sufficiency of any Collateral; (b) Assignor makes
no representation or warranty and assumes no responsibility with respect to the
financial condition of Borrower, any Obligor, any Affiliate of Borrower or the
performance or observance by Borrower, any Obligor, any Affiliate of Borrower
of any of their respective obligations under the Transaction Documents or any
other instrument or document furnished pursuant thereto or in connection
therewith; (c) Assignee confirms that it has received a copy of each of the
Transaction Documents and its Liquidity Agreement, and other documents and
information as it has requested and deemed appropriate to make its own credit
analysis and decision to enter into this Assignment Agreement; (d) Assignee
will, independently and without reliance upon the Agent, Blue Ridge, Borrower
or any other Liquidity Bank or Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under the Transaction Documents
and its Liquidity Agreement; (e) Assignee appoints and authorizes the Agent to
take such action as agent on its behalf and to exercise such powers under the
Transaction Documents and the Liquidity Agreement as are delegated to the Agent
by the terms thereof, together with such powers as are reasonably incidental
thereto; and (f) Assignee agrees that it will perform in accordance with their
terms all of the obligations which, by the terms of its Liquidity Agreement,
the Credit and Security Agreement and the other Transaction Documents, are
required to be performed by it as a Liquidity Bank or, when applicable, as a
Lender.

84

7.                 
Each party hereto represents and warrants to and agrees with
the Agent that it is aware of and will comply with the provisions of the Credit
and Security Agreement, including, without limitation, Sections 14.5 and 14.6
thereof.

8.                 
Schedule I hereto sets forth the revised Commitment and
Liquidity Commitment of Assignor and the Commitment and Liquidity Commitment of
Assignee, as well as administrative information with respect to Assignee.

9.                 
THIS ASSIGNMENT AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF GEORGIA.

10.             
Assignee hereby covenants and agrees that, prior to the date
which is one year and one day after the payment in full of all senior
indebtedness for borrowed money of the Conduit in the Assignor's Conduit Group,
it will not institute against, or join any other Person in instituting against,
such Conduit any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings or other similar proceeding under the laws of the
United States or any state of the United States.

85

IN WITNESS WHEREOF, the parties hereto have caused this
Assignment Agreement to be executed by their respective duly authorized
officers of the date hereof.

[ASSIGNOR]

By:  _________________________

Title:

[ASSIGNEE]

By:  __________________________

Title:

86

SCHEDULE I TO ASSIGNMENT AGREEMENT

 

LIST OF LENDING OFFICES, ADDRESSES

FOR NOTICES AND COMMITMENT AMOUNTS

 

Date:  _____________, ______

Transferred
Percentage:            ____________%

	

  	
  A-1

  	
  A-2

  	
  B-1

  	
  B-2

  	
  C-1

  	
  C-2

  
	
  Assignor

  	
  Commitment
  (prior to giving effect to the Assignment Agreement)

  	
  Commitment
  (after giving effect to the Assignment Agreement)

  	
  Outstanding
  principal (if any)

  	
  Ratable
  Share of Outstanding principal

  	
  Liquidity
  Commitment (prior to giving effect to the Assignment Agreement)

  	
  Liquidity
  Commitment (after giving effect to the Assignment Agreement)

  
	

  	

  	

  	

  	

  	

  	

  

	

  	
  A-1

  	
  A-2

  	
  B-1

  	
  B-2

  	
  C-1

  	
  C-2

  
	
  Assignee

  	
  Commitment
  (prior to giving effect to the Assignment Agreement)

  	
  Commitment
  (after giving effect to the Assignment Agreement)

  	
  Outstanding
  principal (if any)

  	
  Ratable
  Share of Outstanding principal

  	
  Liquidity
  Commitment (prior to giving effect to the Assignment Agreement)

  	
  Liquidity
  Commitment (after giving effect to the Assignment Agreement)

  
	

  	

  	

  	

  	

  	

  	

  

Address for
Notices

                                   
 

                                   
 

Attention:

Phone:

Fax:

87

SCHEDULE II TO ASSIGNMENT AGREEMENT

 

EFFECTIVE NOTICE

 

TO:            ________________________,
Assignor

________________________

________________________

________________________

TO:             ________________________,
Assignee

________________________

________________________

________________________

The undersigned, as Administrative Agent under the Amended
and Restated Credit and Security Agreement dated as of August 4, 2003 by and
among Mohawk Factoring, Inc., a Delaware corporation, Mohawk Servicing, Inc.,
as Servicer, Blue Ridge Asset Funding Corporation, Three Pillars Funding
Corporation, the other conduits party from time to tome thereto, SunTrust
Capital Markets, Inc., as a Co-Agent, the other administrative agents party
from time to time thereof as an agent, Wachovia Bank, National Association, as
an agent and as Administrative Agent, and the Liquidity Banks party thereto,
hereby acknowledges receipt of executed counterparts of a completed Assignment
Agreement dated as of ____________, 200__ between __________________, as
Assignor, and __________________, as Assignee. 
Terms defined in such Assignment Agreement are used herein as therein
defined.

1.            Pursuant
to such Assignment Agreement, you are advised that the Effective Date will be
______________, ____.

2.           Each of
the undersigned hereby consents to the Assignment Agreement as required by
Section 12.1(b) of the Credit and Security Agreement.

[3.  Pursuant to such Assignment Agreement, the
Assignee is required to pay $____________ to Assignor at or before 12:00 noon
(local time of Assignor) on the Effective Date in immediately available funds.]

Very truly yours,

WACHOVIA BANK, NATIONAL
ASSOCIATION, as Administrative Agent

By: __________________________

Title:_______________________

88

BLUE RIDGE
ASSET FUNDING CORPORATION

By:  Wachovia Capital Markets, LLC, its
attorney-in-fact

 

 

By:  ____________________________

Name:

Title:

****[Borrower hereby consents to the
foregoing assignment:

[MOHAWK FACTORING, INC.]

By:  ______________________________
            Name:

            Title:]****

89

EXHIBIT VIII

 

CREDIT AND COLLECTION POLICY

 

See
Exhibit V to Receivables Sale Agreement

90

EXHIBIT IX

 

FORM OF MONTHLY REPORT

 

[see
attached]

91

EXHIBIT X

FORM OF AMENDED AND RESTATED PERFORMANCE
UNDERTAKING

This AMENDED AND RESTATED Performance Undertaking
(this "Undertaking"), dated as of August 4, 2003, is executed by Mohawk
Industries, Inc., a Delaware corporation (the "Performance Guarantor")
in favor of Mohawk Factoring, Inc., a Delaware corporation (together with its
successors and assigns, "Recipient").

RECITALS

1.                 
Mohawk Carpet Distribution, LP, a Delaware limited partnership
and Dal-Tile Corporation, a Delaware corporation (collectively, together with
any other "Originator" under the Sale Agreement referred to below, as the "Originators"),
and Recipient have entered into an Amended and Restated Receivables Purchase
and Sale Agreement, dated as of the date hereof (as amended, restated or
otherwise modified from time to time, the "Sale Agreement"), pursuant to which
Originators, subject to the terms and conditions contained therein, are selling
and/or contributing their respective right, title and interest in their
accounts receivable to Recipient.

2.                 
Recipient, Mohawk Servicing, Inc., a Delaware corporation ("Mohawk
Servicing"), Blue Ridge Asset Funding Corporation ("Blue
Ridge"), Three Pillars Funding
Corporation ("Three Pillars"), the other Conduits from time to
time party thereto, the Liquidity Banks from time to time party thereto,
SunTrust Capital Markets, Inc, as agent for Three Pillars and its liquidity
banks, the other administrative agents from time to time party thereto and
Wachovia Bank, National Association, as agent for Blue Ridge and its liquidity
banks and as Administrative Agent, have entered into a Credit and Security
Agreement, dated as of the date hereof (as amended, restated or otherwise
modified from time to time, the "Credit and Security Agreement"),
pursuant to which Blue Ridge, Three Pillars, the other Conduits and/or the
Liquidity Banks, subject o the terms and conditions contained therein, may make
loans to Recipient.

3.                 
Recipient has requested that Mohawk Servicing act as servicer
for the accounts receivable described above.

4.                 
Performance Guarantor owns, directly or indirectly, one
hundred percent (100%) of the capital stock of each of the Originators and
Recipient, and each of the Originators, and accordingly, Performance Guarantor,
is expected to receive substantial direct and indirect benefits from their sale
or contribution of receivables to Recipient pursuant to the Sale Agreement
(which benefits are hereby acknowledged) and the loans made to Recipient pursuant
to the Credit and Security Agreement (which benefits are hereby acknowledged).

5.                 
As an inducement for Agents and the Lenders to make loans to
Recipient pursuant to the Credit and Security Agreement and for Agents and
Lenders to appoint Mohawk Servicing as Servicer pursuant to the Credit and
Security Agreement, Performance Guarantor has agreed to guaranty (a) the due
and punctual performance by the Originators under the Sale Agreement, (b) the
due and punctual performance by Mohawk Servicing of its servicing duties under
the Credit and Security Agreement, and (c) the due and punctual payment of any
Demand Advance by Mohawk Carpet and/or Mohawk Resources.

92

6.                 
Performance Guarantor wishes to guaranty the due and punctual
performance of the above-described obligations, as provided herein.

AGREEMENT

 

NOW, THEREFORE, Performance
Guarantor hereby agrees as follows:

Section 1.  Definitions.  Capitalized terms used herein and not
defined herein shall the respective meanings assigned thereto in the Credit and
Security Agreement.  In addition:

"Agreements"  means the Sale
Agreement and the Credit and Security Agreement.

"Servicing Agreement"  
has the
meaning provided in the Credit and Security Agreement.

"Guaranteed Obligations" means,
collectively, (a) all covenants, agreements terms, conditions and indemnities
to be performed and observed by the Originators solely in their capacity as
"Originators" under the Sale Agreement, including, without limitation, in each
of the foregoing cases, the due and punctual payment of all sums which are or
may become due and owing by any such Originator in its capacity as a seller
under the Sale Agreement, whether for fees, expenses (including actual and
reasonable counsel fees), indemnified amounts or otherwise, whether upon any
termination or for any other reason, (b) all obligations of each of Mohawk
Carpet and Mohawk Resources to repay any Demand Advance owing by it, and (c)
all obligations of Mohawk Servicing as Servicer under the Credit and Security
Agreement and the Servicing Agreement or which arise pursuant to Sections 8.2,
8.3 or 14.4(a) of the Credit and Security Agreement as a result of its
termination as Servicer.

Section 2.  Guaranty
of Performance of Guaranteed Obligations. 
Performance Guarantor hereby guarantees to Recipient, the full and
punctual payment and performance of the Guaranteed Obligations incurred prior
to the earlier of (i) the time such Servicing Agreement is terminated or (ii)
the time Mohawk Servicing or an Affiliate thereof is no longer the Servicer
under the Servicing Agreement.  This
Undertaking is an absolute, unconditional and continuing guaranty of the full
and punctual performance of all Guaranteed Obligations of Mohawk Servicing and
is in no way conditioned upon any requirement that Recipient first attempt to
collect any amounts owing by Mohawk Servicing to Recipient, the Agents or the
Lenders from any other Person or resort to any collateral security, any balance
of any deposit account or credit on the books of Recipient, the Agents or any
Lender in favor of Mohawk Servicing or any other Person or other means of
obtaining payment.  Should Mohawk
Servicing default in the performance of any of its Guaranteed Obligations,
Recipient (or its assigns) may cause the immediate performance by Performance
Guarantor of the Guaranteed Obligations and cause any payment Guaranteed
Obligations to become forthwith due and payable to Recipient, without demand or
notice of any nature (other than as expressly provided herein or in any other
Transaction Document), all of which are hereby expressly waived by Performance
Guarantor.  Notwithstanding the
foregoing, this Undertaking is not a guarantee of the collection of any of the
Receivables and Performance Guarantor shall not be responsible for any
Guaranteed Obligations to the extent the failure results from Receivables being
uncollectible on account of the insolvency, bankruptcy or lack of
creditworthiness of the related Obligor.

93

Section 3.  Performance
Guarantor's Further Agreements to Pay. 
Performance Guarantor further agrees, as the principal obligor and not
as a guarantor only, to pay to Recipient (and its assigns), forthwith upon
demand in funds immediately available to Recipient, all reasonable costs and
expenses (including court costs and reasonable legal expenses) actually
incurred or expended by Recipient in connection with the Guaranteed
Obligations, this Undertaking and the enforcement thereof, together with
interest on amounts recoverable under this Undertaking from the time when such
amounts become due until payment, at a rate of interest (computed for the
actual number of days elapsed based on a 360 day year) equal to the Prime Rate
plus 2% per annum, such rate of
interest changing when and as the Prime Rate changes.

Section 4.  Waivers
by Performance Guarantor.  Performance Guarantor waives notice of acceptance of this
Undertaking, notice of any action taken or omitted by Recipient (or its
assigns) in reliance on this Undertaking, and any requirement that Recipient
(or its assigns) be diligent or prompt in making demands under this
Undertaking, giving notice of any Termination Event, Amortization Event, other
default or omission by Mohawk Servicing or asserting any other rights of
Recipient under this Undertaking. 
Performance Guarantor warrants that it has adequate means to obtain from
Mohawk Servicing, on a continuing basis, information concerning the financial
condition of Mohawk Servicing, and that it is not relying on Recipient to
provide such information, now or in the future.  Performance Guarantor also irrevocably waives all defenses (i)
that at any time may be available in respect of the Guaranteed Obligations by
virtue of any statute of limitations, valuation, stay, moratorium law or other
similar law now or hereafter in effect or (ii) that arise under the law of
suretyship, including impairment of collateral.  Recipient (and its assigns) shall be at liberty, without giving
notice to or obtaining the assent of Performance Guarantor and without
relieving Performance Guarantor of any liability under this Undertaking, to
deal with Mohawk Servicing and with each other party who now is or becomes
liable in any manner for any of the Guaranteed Obligations, in such manner as
Recipient in its sole discretion deems fit, and to this end, Performance
Guarantor agrees that the validity and enforceability of this Undertaking,
including without limitation, the provisions of Section 7 hereof, shall not be
impaired or affected by any of the following: 
(a) any extension, modification or renewal of, or indulgence with
respect to, or substitutions for, the Guaranteed Obligations or any part
thereof or any agreement relating thereto at any time; (b) any failure or
omission to enforce any right, power or remedy with respect to the Guaranteed
Obligations or any part thereof or any agreement relating thereto; (c) any
waiver of any right, power or remedy or of any Termination Event, Amortization
Event, or default with respect to the Guaranteed Obligations or any part
thereof or any agreement relating thereto; (d) the enforceability or validity
of the Guaranteed Obligations or any part thereof or the genuineness,
enforceability or validity of any agreement relating thereto or with respect to
the Guaranteed Obligations or any part thereof; (e) the existence of any claim,
setoff or other rights which Performance Guarantor may have at any time against
Mohawk Servicing in connection herewith or any unrelated transaction; or (f)
any failure on the part of Mohawk Servicing to perform or comply with any term
of the Guaranteed Obligations whether or not Performance Guarantor shall have
had notice or knowledge of any act or omission referred to in the foregoing
clauses (a) through (f) of this Section 4.

94

Section 5.  Unenforceability
of Guaranteed Obligations Against Mohawk Servicing.  Notwithstanding (a) any change of ownership
of Mohawk Servicing or the insolvency, bankruptcy or any other change in the
legal status of Mohawk Servicing; (b) the change in or the imposition of any
law, decree, regulation or other governmental act which does or might impair,
delay or in any way affect the validity, enforceability or the payment when due
of the Guaranteed Obligations; (c) the failure of Mohawk Servicing or
Performance Guarantor to maintain in full force, validity or effect or to
obtain or renew when required all governmental and other approvals, licenses or
consents required in connection with the Guaranteed Obligations or this
Undertaking, or to take any other action required in connection with the
performance of all obligations pursuant to the Guaranteed Obligations or this
Undertaking; or (d) if any of the moneys included in the Guaranteed Obligations
have become irrecoverable from Mohawk Servicing for any other reason other than
final payment in full of the payment Guaranteed Obligations in accordance with
their terms, this Undertaking shall nevertheless be binding on Performance
Guarantor.  This Undertaking shall be in
addition to any other guaranty or other security for the Guaranteed
Obligations, and it shall not be rendered unenforceable by the invalidity of
any such other guaranty or security.  In
the event that acceleration of the time for payment of any of the Guaranteed
Obligations is stayed upon the insolvency, bankruptcy or reorganization of
Mohawk Servicing or for any other reason with respect to Mohawk Servicing, all
such amounts then due and owing with respect to the Guaranteed Obligations
under the terms of the Agreements, or any other agreement evidencing, securing
or otherwise executed in connection with the Guaranteed Obligations, shall be
immediately due and payable by Performance Guarantor.

Section 6.  Representations
and Warranties.  Performance
Guarantor hereby represents and warrants to Recipient that:

(a)            Existence
and Standing.  Performance Guarantor
is a corporation duly organized, validly existing and in good standing under
the laws of its state of incorporation. 
Performance Guarantor is duly qualified to do business and is in good
standing as a foreign corporation, and has and holds all corporate power and
all governmental licenses, authorizations, consents and approvals required to
carry on its business in each jurisdiction in which its business is conducted
except where the failure to so qualify or so hold could not reasonably be
expected to have a Material Adverse Effect.

(b)            Authorization,
Execution and Delivery; Binding Effect. 
The execution and delivery by Performance Guarantor of this Undertaking,
and the performance of its obligations hereunder, are within its corporate
powers and authority and have been duly authorized by all necessary corporate
action on its part.  This Undertaking
has been duly executed and delivered by Performance Guarantor.  This Undertaking constitutes the legal,
valid and binding obligation of Performance Guarantor enforceable against
Performance Guarantor in accordance with its respective terms, except as such
enforcement may be limited by applicable bankruptcy, insolvency, reorganization
or other similar laws relating to or limiting creditors' rights generally and
by general principles of equity (regardless of whether enforcement is sought in
a proceeding in equity or at law).

95

(c)         No
Conflict; Government Consent.  The
execution and delivery by Performance Guarantor of this Undertaking, and the
performance of its obligations hereunder do not contravene or violate (i) its
certificate or articles of incorporation or by-laws, (ii) any law, rule or
regulation applicable to it, (iii) any restrictions under any agreement,
contract or instrument to which it is a party or by which it or any of its
property is bound, or (iv) any order, writ, judgment, award, injunction or
decree binding on or affecting it or its property, and do not result in the
creation or imposition of any Adverse Claim on assets of Performance Guarantor
(except as created hereunder) except, in any case, where such contravention or
violation could not reasonably be expected to have a Material Adverse Effect.

(d)            Financial
Statements.  The consolidated
financial statements of Performance Guarantor and its consolidated Subsidiaries
dated as of December 31, 2001 and December 31, 2002 heretofore delivered to
Recipient have been prepared in accordance with generally accepted accounting
principles consistently applied and fairly present in all material respects the
consolidated financial condition and results of operations of Performance
Guarantor and its consolidated Subsidiaries as of such dates and for the
periods ended on such dates.  Since the
later of (i) December 31, 2002 and (ii) the last time this representation was
made or deemed made, no event has occurred which would or is reasonably likely
to have a Material Adverse Effect.

Section 7.  Subrogation;
Subordination.  Notwithstanding
anything to the contrary contained herein, until the Guaranteed Obligations are
paid in full Performance Guarantor:  (a)
will not enforce or otherwise exercise any right of subrogation to any of the
rights of Recipient, the Agent, or any Lender against Mohawk Servicing and (b)
will not claim any setoff, recoupment or counterclaim against Mohawk Servicing
in respect of any liability of Performance Guarantor to Mohawk Servicing.  The payment of any amounts due with respect
to any indebtedness of Mohawk Servicing now or hereafter owed to Performance
Guarantor is hereby subordinated to the prior payment in full of all of the
Guaranteed Obligations.  Performance
Guarantor agrees that, after the occurrence of any default in the payment or
performance of any of the Guaranteed Obligations, Performance Guarantor will
not demand, sue for or otherwise attempt to collect any such indebtedness of
Mohawk Servicing to Performance Guarantor until all of the Guaranteed
Obligations shall have been paid and performed in full.  If, notwithstanding the foregoing sentence,
Performance Guarantor shall collect, enforce or receive any amounts in respect
of such indebtedness while any Obligations are still unperformed or
outstanding, such amounts shall be collected, enforced and received by
Performance Guarantor as trustee for Recipient (and its assigns) and be paid
over to Recipient (or its assigns) on account of the Guaranteed Obligations
without affecting in any manner the liability of Performance Guarantor under
the other provisions of this Undertaking. 
The provisions of this Section 7 shall be supplemental to and not in
derogation of any rights and remedies of Recipient under any separate
subordination agreement which Recipient may at any time and from time to time
enter into with Performance Guarantor.

Section 8.  Termination
of Performance Undertaking. 
Performance Guarantor's obligations hereunder shall continue in full
force and effect until the earlier to occur of (i) the time such Servicing
Agreement is terminated, or (ii) the time Mohawk Servicing is no longer the
Servicer under the Servicing Agreement and the Credit and Security Agreement,
except as to the Guaranteed Obligations incurred prior to such date which
remain unsatisfied.  No invalidity,
irregularity or unenforceability by reason of the federal bankruptcy code or
any insolvency or other similar law, or any law or order of any government or
agency thereof purporting to reduce, amend or otherwise affect the Guaranteed
Obligations shall impair, affect, be a defense to or claim against the
obligations of Performance Guarantor under this Undertaking.

96

Section 9.  Effect
of Bankruptcy.  Subject to Sections
2 and 8 hereof, this Performance Undertaking shall survive the insolvency of
Mohawk Servicing and the commencement of any case or proceeding by or against
Mohawk Servicing under the federal bankruptcy code or other federal, state or
other applicable bankruptcy, insolvency or reorganization statutes.  No automatic stay under the federal
bankruptcy code with respect to Mohawk Servicing or other federal, state or
other applicable bankruptcy, insolvency or reorganization statutes to which
Mohawk Servicing is subject shall postpone the obligations of Performance
Guarantor under this Undertaking.

Section 10.  Taxes.  All payments to be made by Performance
Guarantor hereunder shall be made free and clear of any deduction or
withholding.  If Performance Guarantor
is required by law to make any deduction or withholding on account of tax or
otherwise from any such payment, the sum due from it in respect of such payment
shall be increased to the extent necessary to ensure that, after the making of
such deduction or withholding, Recipient receive a net sum equal to the sum
which they would have received had no deduction or withholding been made.

Section 11.  Further
Assurances.  Performance Guarantor
agrees that it will from time to time, at the request of Recipient (or its
assigns), provide information relating to the business and affairs of
Performance Guarantor as Recipient may reasonably request.   

Section 12.  Successors
and Assigns.  This Undertaking shall
be binding upon Performance Guarantor, its successors and permitted assigns,
and shall inure to the benefit of and be enforceable by Recipient and its
successors and permitted assigns. 
Neither party may assign or transfer any of its rights or obligations
hereunder without the prior written consent of each of Recipient and each
Agent; provided, however, that Performance Guarantor hereby
acknowledges and consents to Recipient's grant of a security interest in this
Undertaking to Administrative Agent for the benefit of Lenders.

Section 13.  Amendments
and Waivers.  No amendment or waiver
of any provision of this Undertaking nor consent to any departure by
Performance Guarantor therefrom shall be effective unless the same shall be in
writing and signed by Recipient, the Agents and Performance Guarantor.  No failure on the part of Recipient to
exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any right hereunder
preclude any other or further exercise thereof or the exercise of any other
right.

Section 14.  Notices.  All notices and other communications
provided for hereunder shall be made in writing and shall be addressed as
follows:  if to Performance Guarantor,
at the address set forth beneath its signature hereto, and if to Recipient, at
the addresses set forth beneath its signature hereto, or at such other
addresses as each of Performance Guarantor or any Recipient may designate in
writing to the other.  Any notice by any
party to the other must include a copy to the Administrative Agent at the
address specified in the Credit and Security Agreement.  Each such notice or other communication
shall be effective (1) if given by telecopy, upon the receipt thereof, (2) if
given by mail, three (3) Business Days after the time such communication is
deposited in the mail with first class postage prepaid or (3) if given by any
other means, when received at the address specified in this Section 14.

97

Section 15.  GOVERNING
LAW.  THIS UNDERTAKING SHALL BE
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS)
OF THE STATE OF GEORGIA.

Section 16.  CONSENT
TO JURISDICTION.  EACH OF
PERFORMANCE GUARANTOR AND RECIPIENT HEREBY IRREVOCABLY SUBMITS TO THE
NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR GEORGIA STATE COURT
SITTING IN FULTON COUNTY, GEORGIA IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS UNDERTAKING, THE AGREEMENTS OR ANY OTHER DOCUMENT EXECUTED IN
CONNECTION THEREWITH OR DELIVERED THEREUNDER AND EACH OF THE PERFORMANCE GUARANTOR
AND RECIPIENT HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH
ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT AND
IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE
OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH
COURT IS AN INCONVENIENT FORUM.

Section 18.  Bankruptcy
Petition.  Performance Guarantor
hereby covenants and agrees that, prior to the date that is one year and one
day after the payment in full of all outstanding senior Indebtedness of
Recipient, it will not institute against, or join any other Person in
instituting against, Recipient any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings or other similar proceeding under the
laws of the United States or any state of the United States.

Section 19.  Miscellaneous.  This Undertaking constitutes the entire
agreement of Performance Guarantor with respect to the matters set forth
herein.  The rights and remedies herein
provided are cumulative and not exclusive of any remedies provided by law or
any other agreement, and this Undertaking shall be in addition to any other
guaranty of or collateral security for any of the Guaranteed Obligations.  The provisions of this Undertaking are severable,
and in any action or proceeding involving any state corporate law, or any state
or federal bankruptcy, insolvency, reorganization or other law affecting the
rights of creditors generally, if the obligations of Performance Guarantor
hereunder would otherwise be held or determined to be avoidable, invalid or
unenforceable on account of the amount of Performance Guarantor's liability
under this Undertaking, then, notwithstanding any other provision of this
Undertaking to the contrary, the amount of such liability shall, without any
further action by Performance Guarantor or Recipient, be automatically limited
and reduced to the highest amount that is valid and enforceable as determined
in such action or proceeding.  Any
provisions of this Undertaking which are prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.  Unless otherwise
specified, references herein to "Section" shall mean a reference to
sections of this Undertaking.

98

IN WITNESS WHEREOF, Performance
Guarantor has caused this Undertaking to be executed and delivered as of the
date first above written.

Mohawk
Industries, Inc.

By: ______________________________

Name:                         Scott R.
Veldman

Title:                         Vice
President and Treasurer

Address for Notices:           
 160 S. Industrial Blvd.

                                   
 Calhoun,
GA 30703

                                    Attn:            Scott R. Veldman

                                    Phone:            (706) 624-2103

                                    Fax:            (706) 624-2052

Acknowledged and
Agreed:

 

MOHAWK FACTORING, INC.

By: __________________________

Name:  Linda Bubacz

Title:            Assistant
Treasurer and Secretary

Address for Notices:            300
Delaware Avenue

Suite 1273 C

                                    Wilmington, Delaware  19801

                                    Attn:            Linda Bubacz

                                    Fax:            (302)
552-3128

100

EXHIBIT XI

FORM OF REDUCTION NOTICE

 

---

Mohawk
Factoring, Inc.

REDUCTION NOTICE

dated ______________, 20__

for reduction on ________________, 20__

 

[Applicable Co-Agent]

Attention: 
[_____________________]

Ladies and Gentlemen:

Reference is made to the Amended and Restated Credit and
Security Agreement dated as of August 4, 2003 (as amended, supplemented or
otherwise modified from time to time, the "Credit Agreement") among Mohawk
Factoring, Inc. (the "Borrower"), Mohawk Servicing, Inc.,
as initial Servicer, Blue Ridge Asset Funding Corporation, Three Pillars
Funding Corporation, each other Conduit party from time to time thereto,
SunTrust Capital Markets, Inc., individually and as co-agent and Wachovia Bank,
National Association, individually and as co-agent, each other co-agent from
time to time party thereto and Wachovia Bank, National Association, as
Administrative Agent for the Agents and the Lenders.  Capitalized terms defined in the Credit Agreement are used herein
with the same meanings.

1.                 
The Borrower hereby certifies, represents and warrants to the
Agents and the Lenders that on and as of the Proposed Reduction Date (as
hereinafter defined) after giving effect to the Reduction requested below, the
Aggregate Principal will not exceed the Borrowing Limit.

2.  The Borrower
hereby requests that the Conduits (or their respective Liquidity Banks) make a
reduction of Aggregate Principal on ___________, 20__ (the "Proposed Reduction Date")
(Notice must be received at least 2 Business Days prior for reduction <
$100,000,000 and at least 5 Business Days prior for reduction $100,000,000+) as
follows:

Aggregate Reduction:            $____________

(i)            Blue Ridge Group's Percentage of
such reduction:            $____________

(ii)            TPFC Group's Percentage of such
reduction:            $____________

(iii)               [Other Group's Percentage of such
reduction:               $____________]

101

IN WITNESS WHEREOF,  the Borrower has
caused this Reduction Notice to be executed and delivered as of this ____ day
of ___________, _____.

MOHAWK FACTORING, INC., as
Borrower

By:  _________________________________

Name:

Title:

 

 

102

SCHEDULE A

 

COMMITMENTS OF LIQUIDITY BANKS

 

 

	
  Blue Ridge Liquidity Banks

  	
  Commitment

  
	
   

  	
   

  
	
  Wachovia Bank, National Association

  	
  $178,500,000

  
	

  	
   

  

	
  TPFC Liquidity Banks  

  	
  Commitment

  
	
   

  	
   

  
	
  SunTrust Bank

  	
  $178,500,000

  

103

SCHEDULE B

DOCUMENTS TO BE DELIVERED TO THE AGENT

ON OR PRIOR TO THE INITIAL PURCHASE

1.                 
Executed copies of the Credit and Security Agreement, duly
executed by the parties thereto.

2.                 
Executed copy of the Performance Undertaking, duly executed by
the Performance Guarantor.

3.                 
Copy of the Resolutions of the Board of Directors of each Loan
Party and Performance Guarantor certified by its Secretary authorizing such
Person's execution, delivery and performance of this Agreement and the other
documents to be delivered by it hereunder.

4.                 
Articles or Certificate of Incorporation of each Loan Party
and Performance Guarantor certified by the Secretary of State of its
jurisdiction of incorporation on or within thirty (30) days prior to the
initial Advance.

5.                 
Good Standing Certificate for each Loan Party and Performance
Guarantor issued by the Secretaries of State of its state of incorporation and
each jurisdiction where it has material operations, each of which is listed
below:

a.            Borrower:                                Delaware

b.            Servicer:                                  Delaware; Georgia

c.            Performance
Guarantor:            Delaware; Georgia

6.                    
A certificate of the Secretary of each Loan Party and
Performance Guarantor certifying (i) the names and signatures of the officers
authorized on its behalf to execute this Agreement and any other documents to
be delivered by it hereunder and (ii) a copy of such Person's By-Laws.

7.                    
Pre-filing state and federal tax lien, judgment lien and UCC
lien searches against each Loan Party from the following jurisdictions:

a.            Borrower:
                               Delaware; Georgia

b.            Originators:                               Georgia

8.                 
Time stamped receipt copies of proper financing statements,
duly filed under the UCC on or before the date of the initial Advance in all
jurisdictions as may be necessary or, in the opinion of the Agents, desirable,
under the UCC of all appropriate jurisdictions or any comparable law in order
to perfect the ownership interests contemplated by this Agreement.

 

9.                 
Time stamped receipt copies of proper UCC termination
statements, if any, necessary to release all security interests and other
rights of any Person in the Receivables, Contracts or Related Security
previously granted by Borrower.

10.             
Executed copies of Collection Account Agreements for each
Lock-Box and Collection Account to be delivered not later than 45 days of the
first Advance hereunder.

11.             
A favorable opinion of legal counsel for the Loan Parties and
Performance Guarantor reasonably acceptable to the Agents which addresses the
following matters and such other matters as the Agents may reasonably request:

(a)         Each of
the Loan Parties and Performance Guarantor is a corporation duly organized,
validly existing, and in good standing under the laws of the state of where
each is organized

(b)         The
execution and delivery by each of the Loan Parties and Performance Guarantor of
the Transaction Document to which it is a party and its performance of its
obligations thereunder have been duly authorized by all necessary
organizational action and proceedings on the part of such entity and will not:

(i)            require
any action by or in respect of, or filing with, any governmental body, agency
or official (other than the filing of UCC financing statements);

(ii)            contravene,
or constitute a default under the Georgia Business Corporations Code or the
Delaware General Corporations Law to the extent applicable, its articles or
certificate of incorporation or bylaws or, to such counsel's knowledge, of any
agreement, judgment, injunction, order, decree or other instrument binding upon
such entity; or  

(iii)            result
in the creation or imposition of any Adverse Claim on assets of such entity or
any of its Subsidiaries (except as contemplated by the Transaction Documents).

(d)         Each of
the Transaction Documents to which each of the Loan Parties and Performance
Guarantor is a party has been duly executed and delivered by such entity and
constitutes the legally valid, and binding obligation of such entity
enforceable in accordance with its terms, except to the extent the enforcement
thereof may be limited by bankruptcy, insolvency or similar laws affecting the
enforcement of creditors' rights generally and subject also to the availability
of equitable remedies if equitable remedies are sought and exclusions for
contribution and/or indemnity.

(e)         The
provisions of the Credit and Security Agreement are effective to create valid
security interests in favor of the Agent, for the benefit of the Secured
Parties, in all of Borrower's right, title and interest in and to the
Receivables and their proceeds thereof described therein which constitute
"accounts," "chattel paper" or "general intangibles" (each as defined in the
UCC) (collectively, the "Opinion Collateral"), as security
for the payment of the Obligations.

(f)          Upon
filing of such UCC-1 Financing Statements in such filing offices and payment of
the required filing fees, the security interest in favor of the Administrative
Agent, for the benefit of the Secured Parties, in the Opinion Collateral will
be perfected.

(g)         Based
solely on our review of the [describe
UCC Search Reports], and assuming
(i) the filing of the Financing Statements and payment of the required filing
fees in accordance with paragraph (f) and (ii) the absence of any intervening
filings between the date and time of the Search Reports and the date and time
of the filing of the Financing Statements, the security interest of the
Administrative Agent in the Opinion Collateral is prior to any security
interest granted in the Opinion Collateral by Borrower, the priority of which
is determined solely by the filing of a financing statement in the [describe filing offices].

(h)         Neither
of the Loan Parties nor the Performance Guarantor is a "holding company" or a
"subsidiary holding company" of a "holding company" within the meaning of the
Public Utility Holding Company Act of 1935, as amended, or an "investment
company" within the meaning of the Investment Company Act of 1940, as amended.

12.             
A certificate of a Responsible Financial Officer of each of
the Loan Parties certifying that no Amortization Event or Unmatured
Amortization Event exists and is continuing as of the date of the initial
Advance.

13.             
The Fee Letter.

14.             
A Monthly Report as of a June 30, 2003.

15.             
Executed copies of (i) all consents from and authorizations by
any Persons and (ii) all waivers and amendments to existing credit facilities,
that are necessary in connection with this Agreement.   

16.             
The Liquidity Agreements, duly executed by each of the parties
thereto.

17.             
A copy of the Subordinated Noted issued by Mohawk Factoring,
Inc. in favor of Mohawk Resources, Inc.

18.             
The Receivables Sale Agreement and each of the closing
documents required thereunder.Mohawk - Amended and Restated RP and SA

Exhibit 10.2

AMENDED AND RESTATED RECEIVABLES PURCHASE   

AND SALE AGREEMENT

Dated as of August 4, 2003

among

Mohawk CARPET DISTRIBUTION,
L.P. AND DAL-TILE CORPORATION
as Originators,

and

MOHAWK FACTORING, INC.,

as the Buyer

TABLE
OF CONTENTSpage

  	ARTICLE I AMOUNTS AND TERMS OF THE PURCHASE
	Section 1.1  Purchase of Receivables.   
      	 3
	Section 1.2  Payment for the Purchases.   
      	4
	Section 1.3  Purchase Price Credit
      Adjustments.   	 5
	Section 1.4  Payments and Computations,
      Etc.   	6
	Section 1.5  Transfer of Collection
      Records; License of Software; Access to Contracts.   
      	 6

  	Section 1.6  Characterization..   
      	 6
	ARTICLE II REPRESENTATIONS AND WARRANTIES.   
      	 7
	Section 2.1  Representations
and Warranties of Originators.   	 7
	ARTICLE III CONDITIONS OF PURCHASE..   
      	 10
	Section 3.1  Conditions
Precedent to Purchase.   	10
	Section 3.2  Conditions
Precedent to Subsequent Payments.   	10
	ARTICLE IV COVENANTS.   
      	 11
	Section 4.1  Affirmative
Covenants of Originators.   	11
	Section 4.2  Negative
Covenants of Originators.   	14
	ARTICLE V TERMINATION EVENTS.   
      	 15
	Section 5.1  Termination
Events.   	16
	Section 5.2  Remedies.   
      	16
	ARTICLE VI INDEMNIFICATION..   
      	 16
	Section 6.1  Indemnities
by Originators.   	16

	Section 6.2  Other Costs and Expenses.   
    	
    19
	ARTICLE VII MISCELLANEOUS.   
    	 19
	Section 7.1  Waivers and Amendments.   
    	
    19
	Section 7.2  Notices.   
    	 19
	Section 7.3  Protection of Ownership
    Interests of the Buyer.   	
    19
	Section 7.4  Confidentiality.   
    	
    20
	Section 7.5  Bankruptcy Petition.   
    	
    21
	Section 7.6  CHOICE OF LAW...   
    	 21
	Section 7.7  CONSENT TO JURISDICTION...   
    	 21
	Section 7.8  WAIVER OF JURY TRIAL..   
    	 22
	Section 7.9  Integration; Binding
    Effect; Survival of Terms.   	22
	Section 7.10 Counterparts; Severability;
    Section References.   	 23

Exhibits
and Schedules

Exhibit I            Definitions

Exhibit II          Principal
Place of Business; Location(s) of Collection Records; Federal Employer
Identification Number; Organizational Identification Number; Other Names

Exhibit III         Lock-Boxes
and Collection Accounts

Exhibit IV         Form
of Compliance Certificate

Exhibit V          Copy
of Credit and Collection Policy

Exhibit VI         Form
of Purchase Report

Schedule A       List of
Documents to Be Delivered to the Buyer Prior to the Purchases

AMENDED AND RESTATED RECEIVABLES PURCHASE AND SALE
AGREEMENT

THIS AMENDED AND RESTATED RECEIVABLES
PURCHASE AND SALE AGREEMENT, dated as of August 4, 2003, is by and
among Mohawk Carpet Distribution, L.P., a Delaware limited partnership ("Mohawk
Distribution"), and Dal-Tile Corporation, a Pennsylvania corporation ("Dal-Tile");
each of Mohawk Distribution, Dal-Tile and any other Person that becomes an
"Originator" hereunder pursuant to Section 7.9(b) hereof, an "Originator"
and collectively the "Originators"), and Mohawk
Factoring, Inc., a Delaware corporation ("Buyer"). 
 

Unless defined elsewhere herein, capitalized
terms used in this Agreement shall have the meanings assigned to such terms in Exhibit
I hereto.

PRELIMINARY STATEMENTS

Pursuant to
the terms of that certain Receivables Purchase and Sale Agreement dated
as of October 23, 2000 (as amended, the "Existing Mohawk Agreement")
by and between Mohawk Distribution, as seller, and Buyer, as buyer, Mohawk
Distribution sold Receivables to Buyer.

Pursuant to
the terms of that certain Receivables Purchase and Sale Agreement dated
as of May 14, 2002 (as amended, the "Existing First Step Dal-Tile
Agreement"), by and between Dal-Tile, as seller and DTSC, Inc. ("DTSC"),
as buyer, Dal-Tile sold Receivables to DTSC.  

Pursuant to
the terms of that certain Receivables Purchase and Sale Agreement dated
as of May 14, 2002 (as amended, the "Existing Second Step Dal-Tile
Agreement"; together with the Existing Mohawk Agreement, the "Existing
Receivables Purchase Agreements"), by and between DTSC, as seller and
DT/Mohawk Funding, LLC ("DT/Mohawk Funding"), as buyer, DTSC sold
Receivables acquired from Dal-Tile under the Existing First Step Dal-Tile
Agreement to DT/Mohawk Funding.  

DT/Mohawk Funding is to merge with and into Buyer
and accordingly, the parties hereto wish to amend, restate and consolidate the
Existing Receivables Purchase Agreements with this Agreement.

Each of the Originators party to this Agreement on
the date hereof and the Buyer intended that the past transfers of Receivables
under the Existing Receivables Purchase Agreements be true sales to the
applicable party thereunder, and each of the Originators and the Buyer intend
that all transfers of Receivables hereunder, be true sales to the Buyer by such
Originator of the Receivables originated by it, providing the Buyer with the
full benefits of ownership of such Receivables, and none of the Originators nor
the Buyer intends these transactions to be, or for any purpose to be
characterized as, loans from the Buyer to such Originator.  Each of the Originators acknowledges that
from and after the date hereof, the Buyer intends to finance purchases of
Receivables from the Originators, in part, from the proceeds of loans made
pursuant to an Amended and Restated Credit and Security Agreement of even date
herewith (as the same may from time to time hereafter be amended, supplemented,
restated or otherwise modified, the "Credit and Security Agreement")
among the Buyer, as the borrower, Mohawk Servicing, Inc., a Delaware
corporation, as the initial Servicer, Blue Ridge Asset Funding Corporation ("Blue
Ridge"), Three Pillars Funding Corporation ("TPFC";
together with Blue Ridge and the other issuers of Commercial Paper from time to
time party thereto as "Conduits," each a "Conduit" and
collectively, the "Conduits") and certain other lenders from time
to time party thereto, SunTrust Capital Markets, Inc., as agent for TPFC (the "TPFC
Agent"), and Wachovia Bank, National Association ("Wachovia")
as agent for Blue Ridge (the "Blue Ridge Agent") and any other
entity acting as administrative agent for a Conduit (together with the TPFC
Agent and the Blue Ridge Agent, individually a "Co-Agent" and
collectively, the "Co-Agents") and Wachovia as agent for the
Co-Agents and the Conduits (in such capacity, together with its successors, the
"Administrative
Agent").

2

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

ARTICLE
I

AMOUNTS AND TERMS OF THE PURCHASE

Section 1.1             
Purchase of Receivables.

(a)               
Pursuant to the terms of the Existing Mohawk Agreement, Mohawk
Distribution has sold, transferred, set-over and otherwise conveyed to the
Buyer, without recourse (except to the extent expressly provided therein), and
the Buyer purchased from Mohawk Distribution, all of Mohawk Distribution's
right, title and interest in and to all Receivables originated by Mohawk
Distribution and existing as of the close of business on the Initial Cutoff
Date.  Pursuant to the terms of the
Existing First Step Dal-Tile Agreement and the Existing Second Step Dal-Tile
Agreement, Dal-Tile has sold, assigned, transferred, set-over and otherwise
conveyed to DTSC, who then sold, assigned, transferred, set-over and in
otherwise conveyed to the Buyer (as successor by merger to DT/Mohawk Funding),
in each case without recourse (except to the extent expressly provided
therein), and the Buyer (as the surviving entry of the merger between it and
DT/Mohawk Funding) has purchased from DTSC who purchased from Dal-Tile, all of
Dal-Tile's right, title and interest in and to all Receivables originated by
Dal-Tile and existing as of the close business on the Initial Cutoff Date.  In consideration for the Purchase Price paid
to each Originator upon the terms and subject to the conditions set forth
herein, each Originator does hereby sell, assign, transfer, set-over and
otherwise convey to the Buyer, without recourse (except to the extent expressly
provided herein), and the Buyer does hereby purchase from such Originator all
Receivables originated on the date hereof and thereafter by such Originator
through and including the Termination Date, together, in each case, with all
Related Security relating thereto.  In
accordance with the preceding sentence, the Buyer shall acquire all of each
Originator's right, title and interest in and to all Receivables arising on and
after the date hereof through and including the Termination Date, together with
all of such Originator's rights in and to all Related Security relating
thereto.  The Buyer shall be obligated
to pay the Purchase Price for the Receivablespurchased hereunder from
each Originator in accordance with Section 1.2. From and after the Termination Date, 
the Buyer shall not be obligated to purchase
Receivables from any Originator.

3

(b)              
On each Monthly Reporting Date, each Originator shall (or
shall require the Servicer to) deliver to the Buyer a report in substantially
the form of Exhibit VI hereto (each such report being herein called a "Purchase
Report") with respect to theReceivables sold by such Originator to the
Buyer during the fiscal month then most recently ended.  In addition to, and not in limitation of,
the foregoing, in connection with the payment of the Purchase Price for any
Receivables purchased hereunder, the Buyer may request that the applicable
Originatordeliver, and such Originator shall deliver,
such approvals, opinions, information or documents as the Buyer may reasonably
request.

(c)               
It is the intention of the parties hereto that each Purchase
of Receivables from an Originator made hereunder shall constitute a sale, which
sale is absolute and irrevocable and provides the Buyer with the full benefits
of ownership of the Receivables originated by such Originator.  Except for the Purchase Price Creditsowed to such Originator pursuant to Section
1.3, the sale of Receivables hereunder by each Originator is made without
recourse to such Originator; provided, however, that (i) such
Originator shall be liable to the Buyer for all representations, warranties,
covenants and indemnities made by such Originator pursuant to the terms of the
Transaction Documents to which such Originator is a party, and (ii) such sale
does not constitute and is not intended to result in an assumption by the Buyer
or any assignee thereof of any obligation of such Originator or any other
Person arising in connection with the Receivables, the related Contracts and/or
other Related Security or any other obligations of such Originator.  In view of the intention of the parties
hereto that each Purchase of Receivables made hereunder shall constitute a sale
of such Receivables rather than loans secured thereby, each Originator agrees
that it will, on or prior to thedate hereof and in accordance with Section
4.1(e)(ii), make appropriate notation in its computer files relating to the
Receivables originated by it with a legend properly evidencing that the Buyer
has purchased such Receivables as provided in this Agreement and to note in its
financial statements that its Receivables have been sold to the Buyer.  Upon the request of the Buyer or the
Administrative Agent (as the Buyer's assignee), each Originator will execute
and file such financing or continuation statements, or amendments thereto or
assignments thereof, and such other instruments or notices, as may be necessary
or appropriate to perfect and maintain the perfection of the Buyer's ownership
interest in the Receivables originated by such Originator and theRelated Security with
respect thereto, or as the Buyer may reasonably request.

Section 1.2             
Payment for the Purchases.

(a)               
The Purchase Price for the Purchase from each Originator of
its Receivables in existence as of the close of business on the Initial Cutoff
Date and not previously assigned or transferred to the Buyer, if any, shall be
payable in full by the Buyer to such Originator on the date hereof in
immediately available funds.

4

(b)              
The Purchase Price for each Receivable coming into existence
after the Initial Cutoff Date shall be due and owing in full by the Buyer to
the applicable Originator or its designee in immediately available funds on the
date each such Receivable came into existence except that the Buyer may, with
respect to any such Purchase Price:

(i) offset against such Purchase Price any amounts
owed by such Originator to the Buyer hereunder and which have become due but
remain unpaid; and/or

(ii) elect to defer payment of all or any portion of
the Purchase Price
for Receivables originated by such Originator during the same Calculation
Period (based on the information contained in the Purchase Report delivered by
such Originator for the Calculation Period then most recently ended) until the
next succeeding Settlement Date.

Section 1.3             

Purchase Price Credit Adjustments

.  If on any
day:

(a)        the Outstanding Balance of a Receivable
purchased from any Originator is:

(i)                 
reduced as a result of any defective or rejected or returned
goods or services, any discount or any adjustment or otherwise by such
Originator (other than (A) as a result of (1) such Receivable becoming a
Charged-Off Receivable or (2) cash and volume discounts of up to 3% of the
original Outstanding Balance of such Receivable or (B) to reflect cash Collections
on account of such Receivable),

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

(b)        any of the representations and
warranties set forth in Section 2.1(i), (l), (p), (q), (r), (s) or (t)
hereof is not true when made or deemed made with respect to any Receivable,

then, in such event, the Buyer
shall be entitled to a credit (each, a "Purchase Price Credit") against the
Purchase Price otherwise payable to the applicable Originator hereunder equal
to the Purchase Price paid by the Buyer with respect to such Receivable (less
any Collections received on or after the date of purchase to and including the
date that the Purchase Price Credit is determined).  Each Purchase Price Credit shall be deemed to be a collection of
the related Receivable.  If such
Purchase Price Credit exceeds the Original Balance of the Receivables
originated by the applicable Originator on any day, such Originator shall pay
the remaining amount of such Purchase Price Credit in cash on or prior to the
earlier of (i) the next Settlement Date or (ii) the Termination Date.

5

Section 1.4             

Payments and Computations, Etc.

  All amounts to be
paid or deposited by the Buyer hereunder shall be paid or deposited in
accordance with the terms hereof on the day when due in immediately available
funds to the account of the applicable Originator designated from time to time
by such Originator or as otherwise directed by such Originator.  In the event that any payment owed by any
Person hereunder becomes due on a day that is not a Business Day, then such
payment shall be made on the next succeeding Business Day.  If any Person fails to pay any amount
hereunder when due, such Person agrees to pay, on demand, the Default Fee in
respect thereof until paid in full; provided, however, that such Default
Fee 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 elapsed.

Section 1.5             
Transfer of Collection Records; License of Software;
Access to Contracts

.  In
connection with, and in consideration of, the Purchase from each Originator of
Receivables originated by it, each Originator will deliver to the Buyer or to
the Servicer, on behalf of the Buyer, originals or copies (in written,
photostatic, electronic or other mutually acceptable form) of such Originator's
Collection Records relating to all Receivables sold by it hereunder.  Each Originator shall permit the Servicer
and the Buyer during such Originator's normal business hours and without undue
disruption to the Originator's operations, at the expense of the Buyer or the
Servicer, as applicable (but in no event at the expense of the Administrative
Agent), to inspect and copy all such Collection Records and other books and
records regarding the Receivables and the Contracts solely for purposes of
administering and collecting the Receivables hereunder and under the Collection
Services Agreement.  In order to
facilitate such administration, collection and servicing of such Receivables,
each Originator hereby grants to each of the Buyer, Servicer, and, for so long
as the Credit and Security Agreement remains in effect, the Administrative
Agent, an irrevocable, non-exclusive license to use, without royalty or payment
of any kind, all software used by such Originator to account for such 
Receivables, to
the extent necessary to administer such Receivables, whether such software is
owned by such Originator or is owned by others and used by such Originator
under license agreements with respect thereto, provided that should the
consent of any licensor of such software be required for the grant of the
license described herein, to be effective, such Originator hereby agrees that
upon the request of the Servicer or the Buyer, such Originator will use its
reasonable efforts to obtain the consent of such third-party licensor.  The license granted hereby shall be
irrevocable until the later to occur of (i) the indefeasible payment in full of
the Aggregate Unpaids under the Credit and Security Agreement, and (ii) the
date on which this Agreement terminates in accordance with its terms.

Section 1.6             

Characterization

.  If,
notwithstanding the intention of the parties expressed in Section 1.1(c),
any sale by an Originator to the Buyer of Receivables hereunder shall be
characterized as a secured loan and not a sale or such sale shall for any
reason be ineffective or unenforceable, then this Agreement shall be deemed to
constitute a security agreement under the UCC and other applicable law.  For this purpose and without being in
derogation of the parties' intention that the sale of Receivables by each
Originator hereunder shall constitute a true sale thereof, such Originator
hereby grants to the Buyer a duly perfected security interest in all of such
Originator's right, title and interest in and to all Receivables of such
Originator which exist on the date hereof or arise thereafter through and including
the Termination Date, together with all Related Security with respect thereto,
all other rights and payments relating to such Receivables and all proceeds of
the foregoing, to secure the prompt and complete payment of a loan deemed to
have been made in an amount equal to the Purchase Price of the Receivables
purchased from such Originator together with any Purchase Interest applicable
thereto and all other obligations of such Originator hereunder, which security
interest shall be prior to all other Adverse Claims thereto.  Upon the occurrence of a Termination Event,
the Buyer shall have, in addition to the rights and remedies which it may have
under this Agreement, all other rights and remedies provided to a secured
creditor upon default under the UCC and other applicable law, which rights and
remedies shall be cumulative.

6

ARTICLE II

REPRESENTATIONS AND WARRANTIES

Section 2.1             

Representations and Warranties of Originators

.  Each Originator
hereby represents and warrants to the Buyer on the date of the Purchase from
such Originator hereunder and, except for representations and warranties that
are limited to a certain date, on each date that any Receivable is originated
by such Originator on or after the date of such Purchase through and including
the Termination Date, that:

(a)               

Existence and Power

. 
Such Originator is duly organized, validly existing and in good standing
under the laws of the state set forth after its name in the preamble to this
Agreement, and is duly qualified to do business and is in good standing as a
foreign entity, and has and holds all organizational power, and all
governmental licenses, authorizations, consents and approvals required to carry
on its business in each jurisdiction in which its business is conducted except
where the failure to so qualify or so hold is not reasonably likely to have a
Material Adverse Effect.

(b)              

Power and Authority; Due Authorization, Execution
and Delivery

. 
The execution and delivery by such Originator of this Agreement and each
other Transaction Document to which it is a party, and the performance of its
obligations hereunder and thereunder, and such Originator's use of the proceeds
of the Purchase made from it hereunder, are within its powers and authority and
have been duly authorized by all necessary action on its part.  This Agreement and each other Transaction
Document to which such Originator is a party has been duly executed and
delivered by such Originator.

(c)               

No Conflict

. 
The execution and delivery by such Originator of this Agreement and each
other Transaction Document to which it is a party, and the performance of its
obligations hereunder and thereunder do not contravene or violate (i) its
Organizational Documents, (ii) any law, rule or regulation applicable to it,
(iii) any restrictions under any agreement, contract or instrument to which it
is a party or by which it or any of its property is bound, or (iv) any order,
writ, judgment, award, injunction or decree applicable to it, and do not result
in the creation or imposition of any Adverse Claim on assets of such Originator
or its Subsidiaries (except as created hereunder) except, in any case, where
such contravention or violation is not reasonably likely to have a Material
Adverse Effect; and no transaction contemplated hereby requires compliance with
any bulk sales act or similar law.

7

(d)              

Governmental Authorization

. 
Other than the filing of the financing statements required hereunder, no
authorization or approval or other action by, and no notice to or filing with,
any governmental authority or regulatory body is required for the due execution
and delivery by such Originator of this
Agreement and each other Transaction Document to which it is a party and the
performance of its obligations hereunder and thereunder.

(e)               

Actions, Suits

. 
There are no actions, suits or proceedings pending, or to the best of
such Originator's knowledge, threatened, before any court, arbitrator or other
body, that could reasonably be expected to have a Material Adverse Effect,
except as previously disclosed or for which reserves in reasonable amounts have
been established.  Such Originator is
not in default with respect to any order of any court, arbitrator or
governmental body.

(f)                

Binding Effect

. 
This Agreement and each other Transaction Document to which such
Originator is a party constitute the legal, valid and binding obligations of
such Originator enforceable against such Originator in accordance with their
respective terms, except as such enforcement may be limited by applicable
bankruptcy, insolvency, reorganization or other similar laws relating to or
limiting creditors' rights generally and by general principles of equity
(regardless of whether enforcement is sought in a proceeding in equity or at
law).

(g)               

Accuracy of Information

. 
All written information heretofore furnished by such Originator or any
of its Affiliates to the Buyer for purposes of or in connection with this
Agreement, any of the other Transaction Documents or any transaction
contemplated hereby or thereby is, and all such information hereafter furnished
by such Originator or any of its Affiliates to the Buyer, as of the date
thereof, does not and will not contain any material misstatement of fact or
omit to state a material fact necessary to make the statements contained
therein, in light of the circumstances under which they were made, not
misleading.

(h)               

Use of Proceeds

.  No
payment made to any Originator hereunder will be used for a purpose that
violates Regulation T, U or X of the Board of Governors of the Federal Reserve
System.

(i)                 

Good Title

. 
Each Receivable which is sold to the Buyer hereunder shall be owned by
the respective Originator, free and clear of any Adverse Claim, except as
provided herein or except as may be granted by the Buyer.  Whenever the Buyer makes a purchase
hereunder, it shall have acquired and shall continue to have maintained a valid
ownership interest (free and clear of any Adverse Claim) in the respective
Originator's entire right, title and interest in and to each Receivable and the
Related Security with respect thereto. 
There have been duly filed all financing statements or other similar
instruments or documents necessary under the UCC of all appropriate
jurisdictions to perfect the Buyer's ownership interest in such Receivables and
the Related Security to the extent such interest can be perfected by filing a
financing statement under the UCC.

(j)                

[Reserved]

.

(k)              

Places of Business and Locations of Collection
Records

8

. 
The principal places of business and chief executive office of such
Originator and the offices where it keeps its Collection Records are located at
the address(es) listed on Exhibit II or such other locations of which
the Buyer has been notified in accordance with Section 4.2(a) in
jurisdictions where all action required by Section 4.2(a) has been taken
and completed.  Such Originator's
Federal Employer Identification Number and Organization Identification Number
are correctly set forth on Exhibit II.

(l)                 

Collections

. 
Such Originator has directed all Obligors on the Receivables originated
by it existing on or after the Initial Cutoff Date to make payments thereon
directly to a Collection Account or Lock-Box of the Buyer which is listed on Exhibit
III hereto as the same may be amended from time to time by the Buyer upon
not less than 30 days' prior written notice to the Originators.

(m)             

Material Adverse Effect

. 
Since December 31, 2002, no event has occurred that would have a
Material Adverse Effect.

(n)               

Names

.  In
the 5 years ending on the date of this Agreement, such Originator has not used
any name in which a financing statement naming such Originator (or any entity
which has merged with and into such Originator) as a debtor may be properly
recorded and effective to grant a security interest under the UCC as in effect
in any applicable jurisdiction other than (i) the name in which it has executed
this Agreement, and (ii) as listed on Exhibit II.

(o)              

Not a Holding Company or an Investment Company

. 
Such Originator is not a "holding
company" or a "subsidiary holding
company" of a "holding company"
within the meaning of the Public Utility Holding Company Act of 1935, as
amended, or any successor statute.  Such
Originator is not an "investment company"
within the meaning of the Investment Company Act of 1940, as amended, or any
successor statute.

(p)              

Compliance with Law

. 
Each Receivable reflected in any Purchase Report as an Eligible
Receivable, together with the Invoice related thereto, does not violate any laws, rules or regulations applicable thereto (including,
without
limitation, laws, rules and regulations relating to truth in lending,
fair credit billing, fair credit reporting, equal credit opportunity, fair debt
collection practices and privacy), except where such violation is not
reasonably likely to have a Material Adverse Effect.

(q)              

Compliance with Credit and Collection Policy

. 
Such Originator has complied in all material respects with the Credit
and Collection Policy with regard to each Receivable originated by it and the
related Contract, and has not made any change since the Initial Cut-Off Date to
such Credit and Collection Policy, except such material change as to which the
Buyer has been notified and has consented, as required, in accordance with Section
4.1(a)(vi).

9

(r)                

Payments to such Originator

.  With respect to each Receivable originated
by such Originator and sold to the Buyer hereunder, the Purchase Price (and, if
applicable, Purchase Interest) received by such Originator constitutes fair and
reasonably equivalent value in consideration therefor.

(s)               

Enforceability of Receivables

. 
Each Receivable sold by such Originator to the Buyer hereunder is a
legal, valid and binding obligation of the related Obligor to pay the
Outstanding Balance of the Receivable created thereunder and accrued Finance
Charges (if any) thereon, enforceable against the Obligor in accordance with
its terms, except as such enforcement may be limited by applicable bankruptcy,
insolvency, reorganization or other similar laws relating to or limiting
creditors' rights generally and by general principles of equity (regardless of
whether enforcement is sought in a proceeding in equity or at law).

(t)                

Eligible Receivables

.  Each Receivable reflected in any Purchase
Report as an Eligible Receivable was an Eligible Receivable on the date
of its acquisition by the Buyer hereunder.

(u)               

Accounting

. 
The manner in which such Originator accounts for the transactions
contemplated by this Agreement does not jeopardize the characterization of the
transactions contemplated herein as being true sales.

ARTICLE III

CONDITIONS OF PURCHASE

Section 3.1             
Conditions Precedent to Purchase.

  The Purchase from
each Originator under this Agreement is subject to the conditions precedent
that the Buyer shall have received on or before the date thereof the documents
listed on Schedule A.

Section 3.2             
Conditions Precedent to Subsequent Payments.

  The Buyer's
obligation to pay for Receivables coming into existence after the Initial
Cutoff Date shall be subject to the further conditions precedent that:  (a) the Facility Termination Date shall not
have occurred under the Credit and Security Agreement; (b) the Buyer (or, at
any time the Credit and Security Agreement remains in effect, the
Administrative Agent as the Buyer's assignee) shall have received such other
approvals, opinions or documents as it may reasonably request; and (c) on the
date such Receivable came into existence, the following statements shall be
true (and acceptance of the proceeds of any payment for such Receivable shall
be deemed a representation and warranty by such Originator that such statements
are then true):

(i)                 
the representations and warranties set forth in Article II
are true and correct on and as of the date such Receivable came into existence
as though made on and as of such date; and

(ii)               
no event has occurred and is continuing that will constitute a
Termination Event.

Notwithstanding the foregoing
conditions precedent, and subject to the applicable Originator's receipt of
payment of the Purchase Price for any Receivable, all of such Originator's
right, title and interest in and under such Receivable and the Related Security
with respect thereto shall vest in the Buyer, whether or not the conditions precedent
to the Buyer's obligation to pay for such Receivable were in fact
satisfied.  The failure of such
Originator to satisfy any of the foregoing conditions precedent may, however,
give rise to a claim for indemnity under Article VI of this Agreement.

10

ARTICLE
IV

COVENANTS

Section 4.1             
Affirmative Covenants of  Originators.

  Until the date on
which this Agreement terminates in accordance with its terms, each Originator
hereby covenants as set forth below:

(a)               

Financial Reporting

. 
Such Originator will maintain, for itself and each of its Subsidiaries,
a system of accounting established and administered in accordance with GAAP,
and furnish to the Buyer (or, at any time the Credit and Security Agreement
remains in effect, the Agent as the Buyer's assignee):

(i)                 

Annual Reporting

.  Promptly upon the filing thereof with the
Securities and Exchange Commission, if applicable, and, in any event, within 90
days after the close of each of Parent's fiscal years, audited, unqualified
consolidated financial statements (which shall include balance sheets,
statements of earnings and stockholders' equity and cash flows) for Parent and
its consolidated Subsidiaries (which include such Originator) for such fiscal
year, accompanied by an opinion of independent public accountants of recognized
national standing.

(ii)               

Quarterly Reporting

.  Promptly upon the filing thereof with the
Securities and Exchange Commission, if applicable, and, in any event, within 45
days after the close of the first three (3) quarterly periods of each of
Parent's fiscal years, consolidated balance sheets of Parent and its
consolidated Subsidiaries (including such Originator) as at the close of each
such period and consolidated statements of earnings and stockholders' equity
and cash flows for Parent and its consolidated Subsidiaries for the period from
the beginning of such fiscal year to the end of such quarter, all certified by
a Responsible Financial Officer of Parent.

(iii)              

Compliance Certificate

.  Together with the financial statements
required hereunder, a compliance certificate in substantially the form of Exhibit
IV signed by an Authorized Officer of Parent and dated the date of such
annual financial statement or such quarterly financial statement, as the case
may be.

(iv)             

Shareholders' Statements and Reports

.  Promptly upon the furnishing thereof
generally to the shareholders of Parent, copies of all financial statements,
reports and proxy statements so furnished.

(v)               

S.E.C. Filings

.  Promptly upon the filing thereof, copies of
all registration statements (other than registration statements on Forms S-8 or
S-3 covering benefit or compensation plans, stock purchase or dividend
repurchase plans, or for purposes of resales of securities by holders) and
annual, quarterly or other periodic reports which Parent or any of its
Subsidiaries files with the Securities and Exchange Commission.

11

(vi)             

Change in Credit and Collection Policy

.  At least thirty (30) days prior to the
effectiveness of any material change in or material amendment to the Credit and
Collection Policy, a copy of the Credit and Collection Policy then in effect
and a notice indicating such proposed change or amendment and, if such proposed
change is reasonably likely to adversely affect the collectibility of the
Receivables generally or materially decrease the credit quality of newly created
Receivables generally, requesting the Buyer's consent thereto.

(vii)            

Other Information

.  Promptly, from time to time, such other
information, documents, records or reports relating to the Receivables
originated by such Originator or the condition or operations, financial or
otherwise, of such Originator as the Buyer may from time to time reasonably
request in order to protect the interests of the Buyer under or as contemplated
by this Agreement; provided, however, that the Buyer shall keep all such
information which is not otherwise in the public domain confidential and
require a confidentiality agreement from any third party that may properly
request such information.

(b)              

Notices

. 
Such Originator will notify the Buyer in writing of any of the following
promptly upon learning of the occurrence thereof, describing the same and, if
applicable, the steps being taken with respect thereto:

(i)                 

Termination Events or Unmatured Termination Events

.  The occurrence of each Termination Event and
each Unmatured Termination Event, by a statement of an Authorized Officer of
such Originator.

(ii)               

Material Adverse Effect

.  The occurrence of any event or condition
that has had, or is reasonably likely to have, a Material Adverse Effect.

(iii)              

ERISA Events

.  The
occurrence of any ERISA Event.

(c)               

Compliance with Laws and Preservation of Existence

. 
Such Originator will comply in all respects with all applicable laws,
rules, regulations, orders, writs, judgments, injunctions, decrees or awards to
which it may be subject, except where the failure to so comply is not
reasonably likely to have a Material Adverse Effect.  Such Originator will preserve and maintain its legal existence,
rights, franchises and privileges in the jurisdiction of its organization, and
qualify and remain qualified in good standing as a foreign entity in each
jurisdiction where its business is conducted, except where the failure to so
qualify or remain in good standing is not reasonably likely to have a Material
Adverse Effect.

(d)                          

Audits

. 
Such Originator will furnish to the Buyer from time to time such
information with respect to it and the Receivables sold by it as the Buyer may
reasonably request.  Such Originator
will, from time to time during regular business hours as requested by the Buyer
(or, at any time the Credit and Security Agreement remains in effect, the
Administrative Agent as the Buyer's assignee), upon not less than two (2)
Business Days' prior written notice unless a Termination Event has occurred,
permit the Buyer or their respective agents or representatives:  (i) to examine and make copies of and
abstracts from all Other Records in the possession or under the control of such
Originator relating to the Receivables and the Related Security, including,
without limitation, the related Contracts to the extent permitted by Section
1.5, and (ii) to visit the offices and properties of such Originator for the
purpose of examining such materials described in clause (i) above, and to
discuss, on a confidential basis, matters relating to such Originator's
financial condition or the Receivables and the Related Security or such
Originator's performance under any of the Transaction Documents or such
Originator's performance under the Contracts and, in each case, with any of the
officers or employees of such Originator having knowledge of such matters.

12

(e)               
Keeping and Marking of Records and Books.

(i)                 
Such Originator will maintain or will cause the Servicer to
maintain administrative and operating procedures (including, without
limitation, an ability to recreate records evidencing Receivables in the event
of the destruction of the originals thereof), and keep and maintain all
documents, books, records and other information reasonably necessary or
advisable for the collection of all Receivables (including, without limitation,
records adequate to permit the immediate identification of each new Receivable
and all Collections of and adjustments to each existing Receivable).  Such Originator will give, or will direct
the Servicer to give, the Buyer notice of any material change in the
administrative and operating procedures referred to in the previous sentence.

(ii)               
Such Originator will (A) on or prior to the date hereof, make
appropriate notation in its computer files and other books and records relating
to the Receivables describing the Buyer's ownership interests in the
Receivables and (B) upon the request of the Buyer following the occurrence of a
Termination Event, mark each Invoice applicable to any Receivable sold by such
Originator to the Buyer hereunder with a legend or code describing the Buyer's
ownership thereof.

(f)                

Compliance with Contracts and Credit and Collection
Policy

. 
Such Originator will timely (i) perform and comply in all material
respects with all provisions, covenants and other promises required to be
observed by it under the Contracts related to the Receivables originated by it,
and (ii) comply in all material respects with the Credit and Collection Policy
in regard to each such Receivable and the related Contract.  

(g)               

Ownership

. 
Such Originator will take all necessary action to establish and
maintain, irrevocably, the Buyer's right, title and interest in and to the
Receivables originated or acquired by such Originator and sold to the Buyer
hereunder, and to keep the Receivables and associated Related Security, in each case, free and clear of any Adverse Claims other than
Adverse Claims in favor of the Buyer (including, without limitation, the
filing of all financing statements, continuation statements and/or financing
statement amendments necessary under the UCC of all appropriate jurisdictions
to perfect the Buyer's interest in such Receivables and Related Security to the
extent such interest can be perfected by filing any of the foregoing under the
UCC and such other action to perfect, protect or more fully evidence the
interest of the Buyer as the Buyer may reasonably request).

13

(h)               

Agents' and Lenders' Reliance

. 
Such Originator acknowledges that the Agents and the Lenders are relying
upon the Buyer's identity as a legal entity that is separate from such
Originator and its other Affiliates and agrees to take all reasonable steps to
maintain the Buyer's identity as a separate legal entity and to make it
manifest to third parties that the Buyer is an entity with assets and
liabilities distinct from those of such Originator and its other Affiliates and
not just a division thereof.  Without
limiting the generality of the foregoing and in addition to the other covenants
set forth herein, such Originator (i) will not hold itself out to third parties
as liable for the debts of the Buyer nor purport to own any of the Receivables
or Related Security sold to the Buyer hereunder, and (ii) will
conduct all business with the Buyer on terms reasonably believed by such
Originator and the Buyer to be reasonably comparable to those applicable in
transactions with an unaffiliated Person in similar circumstances.

(i)                 

Taxes

.  To
the extent not handled by Parent, such Originator will file all tax returns and
reports required by law to be filed by it and promptly pay all taxes and
governmental charges at any time owing, except any such taxes which are not yet
delinquent or are being diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance with GAAP shall have
been set aside on its books.  Such
Originator will pay when due any taxes payable in connection with the
Receivables originated by it, exclusive of taxes on or measured by income or
gross receipts of the Buyer and its assigns.

Section 4.2             
Negative Covenants of Originators.

  Until the date on
which this Agreement terminates in accordance with its terms, each Originator
hereby covenants that:

(a)               

Name Change, Offices and Collection Records

. 
Such Originator will not (i) change its state of organization, (ii)
change its legal name, or (iii) relocate any office where Collection Records
are kept by or on behalf of such Originator unless, in each of the foregoing
cases, it shall have:  (A) given the
Buyer at least 30 days' prior written notice thereof and (B) delivered to the
Buyer all financing statements, instruments and other documents requested by
the Buyer in connection with such change or relocation.

(b)              

Change in Payment Instructions to Obligors

. 
Such Originator will not direct any Obligor on the
Receivables sold by it to the Buyer hereunder to make payments to any location
other than to one of the Buyer's Lock-Boxes or Collection Accounts listed on Exhibit
III hereto as the same may be amended pursuant to Section 7.1(j) of
the Credit and Security Agreement from time to time by the Buyer upon not less
than 30 days' prior written notice to the Originators.

(c)               

Modifications to Credit and Collection Policy

. 
Such Originator will not, and will not cause or authorize the Servicer
to, make any material change to the Credit and Collection Policy that would
materially decrease the collectibility of its Receivables generally.

(d)              

Sales, Liens

. 
Such Originator will not sell, assign (by operation of law or otherwise)
or otherwise dispose of, or grant any option with respect to, or create or
suffer to exist any Adverse Claim upon (including, without limitation, the
filing of any financing statement) or with respect to, any Receivable or the
Related Security, or upon or with respect to any Contract under which any
Receivable arises, or assign any right to receive income with respect thereto
(other than, in each case, the creation of the interests therein in favor of
the Buyer provided for herein), and such Originator will defend the right,
title and interest of the Buyer in, to and under any of the foregoing property,
against all claims of third parties claiming through or under such Originator.

14

(e)               

Accounting for Purchases

. 
Such Originator will not account for the transactions contemplated
hereby in any manner other than the sale for financial accounting purposes by
such Originator to the Buyer of the Receivables sold and transferred by such
Originator on or after the Initial Cutoff Date through and including the
Termination Date, together with the associated Related Security, except to the
extent that such transactions are not recognized on account of consolidated
financial reporting in accordance with generally accepted accounting
principles.

ARTICLE
V

TERMINATION EVENTS

Section 5.1             
Termination Events.

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

(a)               
Such Originator shall fail to make any payment or deposit
required hereunder when due, or to perform or observe any term, covenant or
agreement hereunder orunder any other Transaction Document to which
it is a party and such failure shall continue for 30
days after written notice of such failure is
given.

(b)              
Any representation, warranty, certification or statement made
by such Originator in this Agreement, any other Transaction Document to which
it is a party, or in any other document delivered pursuant hereto or thereto
shall prove to have been incorrect in any material respect when made or deemed
made; provided that the materiality threshold in the preceding clause
shallnot be applicable with respect to any
representation or warranty which itself contains a materiality threshold.

(c)               
Failure of any Originator to pay any Indebtedness when due in
excess of $25,000,000 ("Material Debt"); or the default by
any Originator in the performance of any term, provision or condition contained
in any agreement under which any Material Debt was created or isgoverned, the effect of which is to cause, or
to permit the holder or holders of such Material Debt to cause, such
Indebtedness to become due prior to its stated maturity; or any Material Debt
of any Originator shall be declared to be due and payable or required to be
prepaid (other than by a regularly scheduled payment) prior to the date of
maturity thereof.

(d)              
An Event of Bankruptcy shall occur with respect to any
Originator or any of its Material Subsidiaries.

(e)               
A Change of Control shall occur.

15

(f)                
One or more final judgments for the payment of money in an
amount in excess of $25,000,000, individually or in the aggregate, shall be
entered against any Originator on claims not covered by insurance or as to
which the insurance carrier has denied its responsibility, and such judgment
shall continue unsatisfied and in effect for thirty (30) consecutive days
without a stay of execution.

(g)               
The PBGC or Internal Revenue Service shall file any notice of
lien on any of the Receivables or the Related Security and such lien shall not
have been released within seven (7) days.

Section 5.2             
Remedies.

  Upon the
occurrence and during the continuation of a Termination Event, the Buyer may
take any of the following actions:  (i)
declare the Termination Date to have occurred, whereupon the Termination Date
shall forthwith occur, without demand, protest or further notice of any kind,
all of which are hereby expressly waived by each Originator; provided,
however, that upon the occurrence of a Termination Event described in Section
5.1(d), the Termination Date shall automatically occur, without demand,
protest or any notice of any kind, all of which are hereby expressly waived by
each Originator and (ii) to the fullest extent permitted by applicable law,
declare that the Default Fee shall accrue with respect to any amounts then due
and owing by such Originator to the Buyer. 
The aforementioned rights and remedies shall be without limitation and
shall be in addition to all other rights and remedies of the Buyer and, so long
as the Credit and Security Agreement remains in effect, the Administrative
Agent as the Buyer's assignee otherwise available under any other provision of
this Agreement, by operation of law, at equity or otherwise, all of which are
hereby expressly preserved, including, without limitation, all rights and
remedies provided under the UCC, all of which rights shall be cumulative.

ARTICLE VI

INDEMNIFICATION

Section 6.1             
Indemnities by Originators.

  Without limiting
any other rights that the Buyer may have hereunder or under applicable law,
each Originator hereby agrees to indemnify (and pay upon demand to) the Buyer
and its assigns, officers, directors, agents and employees (each an "Indemnified
Party") from and against any and all damages, losses, claims, taxes,
liabilities, costs, expenses and for all other amounts payable, including
reasonable attorneys' fees and disbursements actually incurred (all of the
foregoing being collectively referred to as "Indemnified Amounts")
awarded against and actually paid or actually incurred by any of them arising
out of or as a result of this Agreement or the acquisition, either directly or
indirectly, by the Buyer of any interest in the Receivables originated by such
Originator,  excluding, however:

(a)                           
Indemnified Amounts to the extent a final judgment of a court
of competent jurisdiction holds that such Indemnified Amounts resulted from
gross negligence or willful misconduct on the part of the Indemnified Party
seeking indemnification;  

(b)                          
Indemnified Amounts to the extent the same arise out of or as
a result of claims of one or more Indemnified Parties against another
Indemnified Party;

16

(c)                           
Indemnified Amounts to the extent the same includes losses in
respect of Receivables originated by such Originator that are uncollectible on
account of the insolvency, bankruptcy or lack of creditworthiness of the
related Obligor; or

(d)                          
taxes imposed by the jurisdiction in which such Indemnified
Party's principal executive office is located, on or measured by the overall
net income or gross receipts of such Indemnified Party;

provided, however, that
nothing contained in this sentence shall limit the liability of such Originator
or limit the recourse of the Buyer to such Originator for amounts otherwise
specifically provided to be paid by such Originator under the terms of this
Agreement.  Without limiting the
generality of the foregoing indemnification, but subject in each case to
clauses (a), (b) and (c) above, each Originator shall indemnify the Buyer for
Indemnified Amounts relating to or resulting from:

(i)                 
any representation or warranty made by such Originator (or any
officers of such Originator) under or in connection with any Purchase Report,
this Agreement, any other Transaction Document to which such Originator is a
party or any other information or report delivered by such Originator pursuant
hereto or thereto for which the Buyer has not received a Purchase Price Credit
that shall have been false or incorrect when made or deemed made;

(ii)               
the failure by such Originator, to comply with any applicable
law, rule or regulation with respect to any Receivable or Contract related
thereto, or the nonconformity of any Receivable or Contract included therein
with any such applicable law, rule or regulation or any failure of such
Originator to keep or perform any of its obligations, express or implied, with
respect to any Contract;

(iii)              
any failure of such Originator to perform its duties,
covenants or other obligations in accordance with the provisions of this
Agreement or any other Transaction Document;

(iv)             
any products liability, personal injury or damage, suit or
other similar claim arising out of or in connection with goods or services that
are the subject of any Contract or any Receivable;

(v)               
any dispute, claim, offset or defense (other than discharge in
bankruptcy of the Obligor) of the Obligor to the payment of any Receivable
(including, without limitation, a defense based on such Receivable or the
related Contract 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 goods or service related to such
Receivable or the furnishing or failure to furnish such goods or services;

17

(vi)             
any Collections received, directly or indirectly by an
Originator (or its agent) which are not promptly remitted to Buyer;

(vii)            
any investigation, litigation or proceeding related to or
arising from this Agreement or any other Transaction Document, the transactions
contemplated hereby, such Originator's use of the proceeds of the Purchase from
it hereunder, the ownership of the Receivables originated by such Originator or
any other investigation, litigation or proceeding relating to such Originator
in which any Indemnified Party becomes involved as a result of any of the
transactions contemplated hereby;

(viii)          
any inability to litigate any claim against any Obligor in
respect of any Receivable reflected in any Purchase Report as being an Eligible
Receivable as a result of such Obligor being immune from civil and commercial
law and suit on the grounds of sovereignty or otherwise from any legal action, suit
or proceeding;

(ix)             
any Termination Event described in Section 5.1(d);

(x)               
any failure to vest and maintain vested in the Buyer, or to
transfer to the Buyer, ownership of the Receivables originated by such
Originator and purported to be conveyed to the Buyer hereunder, together with
the associated Related Security, in each case, free and clear of any Adverse
Claim;

(xi)             
the failure to have filed, or any delay in filing, financing
statements or other similar instruments or documents under the UCC of any
applicable jurisdiction or the applicable laws of Canadawith respect to
any Receivable originated by such Originator and the Related Security with
respect thereto, and the proceeds of any thereof, whether at the time of the
Purchase from such Originator hereunder or at any subsequent time;

(xii)            
any action or omission by such Originator which impairs the
rights of the Buyer with respect to any Receivable or reduces the value of any
such Receivable (for any reason other than the application of Collections
thereto or charge-off of any Receivable as uncollectible) unless the Buyer has
received a Purchase Price Credit therefor; and

(xiii)          
the failure of any Receivable reflected as an Eligible
Receivable on any Purchase Report prepared by such Originator to be an Eligible
Receivable at the time acquired by the Buyer.

Section 6.2             
Other Costs and Expenses.

  Each Originator
shall pay to the Buyer on demand all reasonable costs and out-of-pocket
expenses actually incurred in connection with the preparation, execution and
delivery of this Agreement, the transactions contemplated hereby and the other
documents to be delivered hereunder.  In
addition to the foregoing, each Originator shall pay, on demand, any and all
reasonable costs and expenses, including reasonable counsel fees and expenses,
actually incurred by the Buyer (or, at any time the Credit and Security
Agreement remains in effect, the Administrative Agent as the Buyer's assignee)
in connection with (i) any amendment to or waiver of this Agreement, and/or
(ii) the enforcement of this Agreement and the other documents delivered
hereunder following a Termination Event.

18

ARTICLE
VII

MISCELLANEOUS

Section 7.1             
Waivers and Amendments.

(a)        No
failure or delay on the part of the Buyer (or, at any time the Credit and
Security Agreement remains in effect, the Administrative Agent as the Buyer's
assignee) in exercising any power, right or remedy under this Agreement shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such power, right or remedy preclude any other further exercise thereof or the
exercise of any other power, right or remedy. 
The rights and remedies herein provided shall be cumulative and
nonexclusive of any rights or remedies provided by law.  Any waiver of this Agreement shall be
effective only in the specific instance and for the specific purpose for which
given.

(b)        No
provision of this Agreement may be amended, supplemented, modified or waived
except in writing signed by each Originator and the Buyer and, to the extent
required under the Credit and Security Agreement, the applicable Agent and the
Liquidity Banks or the Required Liquidity Banks.  At any time while the Credit and Security
Agreement remains in effect, any material amendment, supplement, modification
or waiver will require satisfaction of the Rating Agency Condition, if applicable.

Section 7.2             

Notices

.  All
communications and notices provided for hereunder shall be in writing
(including bank wire, telecopy or electronic facsimile transmission or similar
writing) and shall be given to the other parties hereto at their respective
addresses or telecopy numbers set forth on the signature pages hereof or at
such other address or telecopy number as such Person may hereafter specify for
the purpose of notice to each of the other parties hereto.  Each such notice or other communication
shall be effective (a) if given by telecopy, upon the receipt thereof,
(b) if given by mail, three (3) Business Days after the time such
communication is deposited in the mail with first class postage prepaid or
(c) if given by any other means, when received at the address specified in
this Section 7.2.

Section 7.3             
Protection of Ownership Interests of the Buyer.

(a)               
Each Originator agrees that from time to time, at its expense,
it will promptly execute and deliver all instruments and documents, and take
all actions, that may be necessary or desirable, or that the Buyer (or, at any
time the Credit and Security Agreement remains in effect, the Administrative
Agent as the Buyer's assignee) may request, to perfect, protect or more fully
evidence the interest of the Buyer (or, at any time the Credit and Security
Agreement remains in effect, the Administrative Agent as the Buyer's assignee)
hereunder, or to enable the Buyer (or, at any time the Credit and Security
Agreement remains in effect, the Administrative Agent as the Buyer's assignee)
to exercise and enforce their rights and remedies hereunder.  At any time following a Termination Event,
the Buyer (or, at any time the Credit and Security Agreement remains in effect,
the Administrative Agent as the Buyer's assignee) may, at such Originator's
sole cost and expense, direct such Originator to notify the Obligors of
Receivables of the ownership interests of the Buyer under this Agreement and
may also direct thatpayments of all amounts
due or that become due under any or all Receivables be made directly to the
Buyer (or, at any time the Credit and Security Agreement remains in effect, the
Administrative Agent as the Buyer's assignee) or the Buyer's (or such assigns')
designee.

19

(b)              
If any Originator fails to perform any of its obligations
hereunder, the Buyer (or, at any time the Credit and Security Agreement remains
in effect, the Administrative Agent as the Buyer's assignee) may (but shall not
be required to) perform, or cause performance of, such obligations, and the
Buyer's (or such assignees') costs and expenses incurred in connection
therewith shall be payable by such Originator as provided in Section 6.2.  Each Originator irrevocably authorizes the
Buyer (and, at any time the Credit and Security Agreement remains in effect,
the Administrative Agent as the Buyer's assignee) at any time and from time to
time in the sole discretion of the Buyer (or, at any time the Credit and
Security Agreement remains in effect, the Administrative Agent as the Buyer's
assignee), and appoints the Buyer (and, at any time the Credit and Security
Agreement remains in effect, the Administrative Agent as the Buyer's assignee)
as its attorney(ies)-in-fact, to act onbehalf of such Originator (i) to execute on
behalf of such Originator as debtor, in the event such Originator fails to
timely execute, and to file financing statements necessary in the Buyer's (or,
at any time while the Credit and Security Agreement remains in effect, the
Administrative Agent's) reasonable opinion to perfect and to maintain the
perfection and priority ofthe interest of the Buyer in the Receivables
originated by such Originator and (ii) in the event such Originator fails to
deliver any financing statement requested pursuant to the preceding clause (i),
to file a carbon,photographic or other reproduction of this
Agreement or any financing statement with respect to the Receivables as a
financing statement in such offices as the Buyer (or, at any time the Credit
and Security Agreement remains in effect, the Administrative Agent as the
Buyer's assignee) in their sole discretion deem necessary or desirable to
perfect and to maintain the perfection and priority of the Buyer's interest in
such Receivables.  This appointment is
coupled with an interest and is irrevocable.

Section 7.4             
Confidentiality.

(a)                           
Each Originator shall maintain and shall cause each of its
employees and officers to maintain the confidentiality of the Fee Letters
(under and as defined in the Credit and Security Agreement) and the electronic
models and files (including electronic files containing model accounting
entries for securitization transactions) provided by any Agent or any Conduit
in connection with the Credit and Security Agreement, provided,
however, such information may be disclosed to third parties to the
extent such disclosure is (i) required to comply with any applicable law
(including federal and state securities laws) or order of any judicial or
administrative proceeding, or (ii) required in response to any summons or
subpoena or in connection with any litigation, provided, further, that
such Originator inform such person that such information is sensitive,
proprietary and confidential. 
Notwithstanding the foregoing, each Originator shall have no obligation
of confidentiality in respect of any information which may be generally available
to the public or becomes available to the public through no fault of such
Originator or its Affiliates.

20

(b)                          
The Buyer (and, accordingly, each of its assignees) shall
maintain, shall cause each of its employees, officers and agents to maintain,
and shall require the Lenders to maintain and to cause each of their respective
employees, officers and agents to maintain, the confidentiality of any
information obtained by it in respect of the Receivables (including, without
limitation, credit losses and delinquency levels) and any other proprietary or
confidential information with respect to Parent, the Obligors, the Receivables,
the Originators and the Servicer in communications with third parties; provided,
however, such information may be disclosed to third parties to the
extent such disclosure is (i) required to comply with any applicable law
(including federal and state securities laws) or order of any judicial or
administrative proceeding, or (ii) required in response to any summons or
subpoena or in connection with any litigation, or (iii) to any Person specified
in Section 14.5 of the Credit and Security Agreement on the terms set forth
therein.

Section 7.5             
Bankruptcy Petition.

(a)        Each
Originator and the Buyer covenant and agree that, prior to the date that is one
year and one day after the payment in full of all outstanding senior
indebtedness of all Conduits, it will not institute against, or join any other
Person in instituting against, any Conduit any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings or other similar proceeding
under the laws of the United States or any state of the United States.

(b)        Each
Originator covenants and agrees that, prior to the date that is one year and
one day after the payment in full of all outstanding obligations of the Buyer
under the Credit and Security Agreement, it will not institute against, or join
any other Person in instituting against, the Buyer any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings or other
similar proceeding under the laws of the United States or any state of the
United States.

Section 7.6             

CHOICE OF LAW

.  THIS AGREEMENT
SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS (AND NOT
THE LAW OF CONFLICTS) OF THE STATE OF GEORGIA.

Section 7.7             

CONSENT TO JURISDICTION

.  ORIGINATOR
HEREBY IRREVOCABLY SUBMITS TO THE NON‐EXCLUSIVE JURISDICTION OF ANY
UNITED STATES FEDERAL OR GEORGIA STATE COURT SITTING IN FULTON COUNTY, GEORGIA
IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY
DOCUMENT EXECUTED BY ORIGINATOR PURSUANT TO THIS AGREEMENT AND ORIGINATOR
HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES
ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT,
ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN
INCONVENIENT FORUM.  NOTHING HEREIN
SHALL LIMIT THE RIGHT OF BUYER (OR ITS ASSIGNS) TO BRING PROCEEDINGS AGAINST
ORIGINATOR IN THE COURTS OF ANY OTHER JURISDICTION.

21

Section 7.8             

WAIVER OF JURY TRIAL

.  TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, EACH PARTY HERETO HEREBY WAIVES TRIAL BY
JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER
(WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF,
RELATED TO, OR CONNECTED WITH THIS AGREEMENT, ANY DOCUMENT EXECUTED BY
ORIGINATOR PURSUANT TO THIS AGREEMENT OR THE RELATIONSHIP ESTABLISHED HEREUNDER
OR THEREUNDER.

Section 7.9             
Integration; Binding Effect; Survival of Terms.

(a)               
The Transaction Documents contain the final and complete
integration of all prior expressions by the parties hereto with respect to the
sale and collection of the Receivables and Related Security and shall
constitute the entire agreement among the parties hereto with respect to such
subject matter, superseding all prior oral or written understandings with
respect to the sale and collection of the Receivables and Related Security.

(b)              
Nothing contained herein or in any other Transaction Document
shall be deemed to prohibit or limit any merger or consolidation of an
Originator with another Originator so long as any necessary financing
statements are filed, promptly after the effectiveness of such merger or
consolidation, under the UCC in all jurisdictions necessary to make the
representations and warranties contained in this Agreement true and correct
after giving effect to such merger or consolidation.  Nothing contained herein or any other Transaction Document shall
be deemed to prohibit or limit any new entity from becoming an Originator
hereunder so long as items 2 through 10 of Schedule A attached hereto are
satisfied by such entity.  This
Agreement shall be binding upon and inure to the benefit of the Originators,
the Buyer and their respective successors and permitted assigns (including any
trustee in bankruptcy).  No Originator
may assign any of its rights and obligations hereunder or any interest herein
without the prior written consent of the Buyer; provided, however, that
no consent of the Buyer shall be required in connection with an assignment by
operation of law to the surviving Originator in a merger or consolidation
described in the first sentence of this Section 7.9(b).  The Buyer may pledge or assign at any time
its rights and obligations hereunder and interests herein to any other Person
without the consent of any Originator. 
Without limiting the foregoing, each Originator acknowledges that the
Buyer, pursuant to the Credit and Security Agreement, may grant to the Administrative
Agent for the benefit of the Secured Parties (under and as defined in the
Credit and Security Agreement), a security interest in the Buyer's rights,
remedies, powers and privileges hereunder. 
This 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 terminated in accordance with
its terms; provided, however, that the rights and remedies with respect to
(i) anybreach of any
representation and warranty made by any Originator pursuant to Article II;
(ii) the indemnification and payment provisions of Article VI; and
(iii) Section 7.4 shall be continuing and shall survive any assignment
or termination of this Agreement.

22

Section 7.10         

Counterparts; Severability; Section References

.  This
Agreement may be executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which when so executed shall
be deemed to be an original and all of which when taken together shall
constitute one and the same Agreement. 
Any provisions of this Agreement which are prohibited or unenforceable
in any jurisdiction shall, as to such jurisdiction, be ineffective to the
extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in
any jurisdiction shall not invalidate or render unenforceable such provision in
any other jurisdiction.  Unless
otherwise expressly indicated, all references herein to "Article,"
"Section,"
"Schedule"
or "Exhibit"
shall mean articles and sections of, and schedules and exhibits to, this
Agreement.

<Signature pages follow>

 

23

IN WITNESS WHEREOF, the parties
hereto have caused this Agreement to be executed and delivered by their duly
authorized officers as of the date hereof in Wilmington, Delaware.

Mohawk CARPET DISTRIBUTION, L.P.

By:        
                                               
 

Name:                                                  
 

Title:                                                     
 

Address:         
 160 S. Industrial Blvd.

Calhoun, GA 30703

Attn:  Scott R. Veldman

Phone:  (706) 624-2103

                        Fax:
     (706) 624-2052

DAL-TILE CORPORATION

By:        
                                               
 

Name:                                                  
 

Title:                                                     
 

Address:          160
S. Industrial Blvd.

                       
 Calhoun,
GA  30703

Attn:  Scott R. Veldman

Phone:  (706) 624-2103

                        Fax:  (706) 624-2052

MOHAWK FACTORING, INC.

By:        
                                               
 

Name:  Linda Bubacz

Title:     Assistant Treasurer and Secretary

Address:         
 300 Delaware Ave.

                       
 Suite
1273 C

                        Wilmington,
Delaware 19801

Attn:  Linda Bubacz

Phone:  (302) 552-3100

                        Fax:      (302) 552-3128

Exhibit I

Definitions

 

This is Exhibit I to the Agreement (as hereinafter
defined).  As used in the Agreement and
the Exhibits and Schedules thereto, capitalized terms have the meanings set
forth in this Exhibit I (such meanings to be equally applicable to the singular
and plural forms thereof).

"Administrative Agent" has the
meaning set forth in the Preliminary Statements to the Agreement.

"Adverse Claim" means a lien,
security interest, charge or encumbrance, or other right or claim in, of or on
any Person's assets or properties in favor of any other Person.

"Agreement" means the Amended and
Restated Receivables Purchase and Sale Agreement, dated as of August 4, 2003,
among Originators and the Buyer, as the same may be amended, restated or
otherwise modified.

"Blue Ridge" has the meaning set
forth in the Preliminary Statements to the Agreement.

"Business Day" means any day on
which banks are not authorized or required to close in New York, New York or
Atlanta, Georgia, and The Depository Trust Company of New York is open for
business, and, if the applicable Business Day relates to any computation or
payment to be made with respect to the LIBO Rate, any day on which dealings in
dollar deposits are carried on in the London interbank offering market.

"Buyer" has the meaning set forth in
the preamble to the Agreement.

"Calculation Period" means each
fiscal month of the Buyer or portion thereof which elapses during the term of
the Agreement.  The first Calculation
Period shall commence on the date of the initial Purchase hereunder and the
final Calculation Period shall terminate on the Termination Date.   
For purposes of the use of this term in other
definitions in Exhibit I to this Agreement, Calculation Periods occurring prior
to the date of the initial Purchase hereunder shall mean a fiscal month of the
Buyer.

"Canadian Receivable"  
means a
Receivable owing from an Obligor domiciled in, or organized under the laws of,
Canada or one of its political subdivisions.

"Change of Control" means the
acquisition by any Person, or two or more Persons acting in concert, of
beneficial ownership (within the meaning of Rule 13d-3 of the Securities
and Exchange Commission under the Securities Exchange Act of 1934) of 30% or
more of the outstanding shares of voting stock of Parent, or Parent ceases to
own, directly or indirectly, all of the outstanding shares of voting stock of
each Originator.

25

"Collection Accounts" means those
accounts shown on Exhibit III, as the same may be amended from time to
time by the Buyer in accordance with the terms hereof.

"Collection Records"  
means, with
respect to any Receivable, all Invoices and all other documents, books, records
and other information (including, without limitation, computer programs, tapes,
disks, punch cards, data processing software and related property and rights)
relating to amounts paid on or owing in respect of such Receivable.

"Collection Services Agreement"
 means
that certain Servicing Agreement dated as of October 25, 2000 by and between
the Buyer and Mohawk Servicing, Inc., as Servicer, providing for the collection
and servicing of all Receivables held by the Buyer.   

"Collections" means, with respect to
any Receivable, all cash collections and other cash proceeds in respect of such
Receivable, including, without limitation, all Finance Charges or other related
amounts accruing in respect thereof and all cash proceeds of Related Security
with respect to such Receivable.

"Contingent Obligation" of a Person
means any agreement, undertaking or arrangement by which such Person assumes,
guarantees, endorses, contingently agrees to purchase or provide funds for the
payment of, or otherwise becomes or is contingently liable upon, the obligation
or liability of any other Person, or agrees to maintain the net worth or
working capital or other financial condition of any other Person, or otherwise
assures any creditor of such other Person against loss, including, without limitation,
any comfort letter, operating agreement, take-or-pay contract or application
for a letter of credit.

"Contract" means, with respect to
any Receivable, any and all instruments and agreements, purchase orders,
invoices, writings, or other communications pursuant to which such Receivable
arises but excluding any Invoice.

"Credit and Collection Policy" means
each Originator's credit and collection policies and practices relating to
Contracts and Receivables existing on and as administered historically prior to
the date hereof and summarized in Exhibit V, as modified from time to
time in accordance with the Agreement.

"Credit and Security Agreement" has
the meaning set forth in the Preliminary Statements to the Agreement.

"Dal-Tile" has the meaning set forth in the
preamble to the Agreement.

"Default Fee" means a per annum rate of interest equal to the
sum of (i) the Prime Rate, plus (ii) 2% per annum.

"Defaulted Receivable" means a
Receivable:  (i) as to which the Obligor
thereof has suffered an Event of Bankruptcy; (ii) which, consistent with the
Credit and Collection Policy, would be written off Originator's books as
uncollectible; or (iii) as to which any payment, or part thereof, remains
unpaid for 61 days or more from the original due date for such payment.

26

"Delinquent Receivable" means a
Receivable as to which any payment, or part thereof, remains unpaid for 31-60  days
from the original due date for such payment.

"Discount Factor" means a percentage
calculated to provide the Buyer with a reasonable return on its investment in
the Receivables originated by each Originator after taking account of (i) the
time value of money based upon the anticipated dates of collection of such
Receivables and the cost to the Buyer of financing its investment in such
Receivables during such period and (ii) the risk of nonpayment by the
Obligors.  Each Originator and the Buyer
may agree from time to time to change the Discount Factor based on changes in
one or more of the items affecting the calculation thereof, provided
that any change to the Discount Factor shall take effect as of the
commencement of a Calculation Period, shall apply only prospectively and shall
not affect the Purchase Price payment made prior to such Calculation Period
during which such Originator and the Buyer agree to make such change.

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

(i)                 
the Obligor of which (a) if a natural person, is a resident of
the United States or Canada or, if a corporation or other business
organization, is organized under the laws of the United States, Canada or any
political subdivision of the United States or Canada and has its chief
executive office in the United States or Canada; (b) is not an Affiliate of any
of the parties hereto; and (c) is not a government or a governmental
subdivision or agency; provided, however, that in no event
may the Canadian Receivables that are included as Eligible Receivables exceed
3% of total Receivables at any time,

(ii)               
which is not a Defaulted Receivable,

(iii)              
which was not a Delinquent Receivable on (A) the date of
Purchase (if such Receivable was in existence on the Initial Cutoff Date), or
(B) the date on which such Receivable came into existence (in all other cases),

(iv)             
which (A) by its terms is due and payable within 91 days of
the original billing date therefor; provided, however, notwithstanding
anything herein to contrary, any Receivable which by its terms is due and
payable within 92-120 days of the original billing date thereof shall be
included as an Eligible Receivable, provided that the Outstanding Balance of
all such Receivables shall not exceed 2.5% of the total Outstanding Balance of
all Eligible Receivables, (B) has not had its payment terms extended more than
once, and (C) will not, when added to all other Eligible Receivables, cause the
weighted average of the payment terms for all Eligible Receivables to exceed 50
days,

(v)               
which is an "account," a "payment intangible," a "general
intangible" or "chattel paper" within the meaning of Article 9 of the UCC in
the applicable jurisdiction, and is not evidenced by an "instrument" within the
meaning of Article 9 of the UCC,

27

(vi)             
which is denominated and payable only in United States Dollars
or Canadian Dollars in the United States or Canada,

(vii)            
which is in full force and effect and constitutes the legal,
valid and binding obligation of the related Obligor enforceable against such
Obligor in accordance with its terms,

(viii)          
which does not contain a confidentiality provision that
purports to restrict the ability of theBuyer (or, at any time
the Credit and Security Agreement remains in effect, the Administrative Agent
as the Buyer's assignee) to exercise its rights under this Agreement,
including, without limitation, its right to review the Contract or Invoice
applicable thereto,

(ix)             
which represents an obligation to pay a specified sum of
money, contingent only upon (A) the sale of goods or the provision of services
by the applicable Originator (which sale has been consummated or services have
been performed), and (B) satisfaction by such Originator of any applicable
warranty claims which have not yet been made or asserted,

(x)               
which does not contravene any law, rule or regulation
applicable thereto (including, without limitation, any law, rule and regulation
relating to truth in lending, fair credit billing, fair credit reporting, equal
credit opportunity, fair debt collection practices and privacy),

(xi)             
which satisfies all applicable requirements of the applicable
Credit and Collection Policy in all material respects,

(xii)            
which was generated in the ordinary course of the applicable
Originator's business,

(xiii)          
which arises solely from the sale (and not the lease) of goods
or the provision of services to the related Obligor by the applicable
Originator or a predecessor to such Originator, and not by any other Person (in
whole or in part),

(xiv)          
which is not the subject of, to the Originator's knowledge,
any dispute, counterclaim, right of rescission, set-off, counterclaim or any
other defense (including defenses arising out of violations of usury laws) of
the applicable Obligor against the applicable Originator or any other Adverse
Claim, and the Obligor thereon holds no right as against such Originator to
cause such Originator to repurchase the goods or merchandise the sale of which
shall have given rise to such Receivable (except with respect to sale discounts
effected pursuant to the Contract, or defective goods returned in accordance
with the terms of the Contract) and which requires that all or part of such
Receivables be charged off in accordance with the Credit and Collections
Policy; provided, however, that if such dispute,
offset, counterclaim or defense affects only a portion of the Outstanding
Balance of such Receivable, then such Receivable may be deemed an Eligible
Receivable to the extent of the portion of such Outstanding Balance which is
not so affected,

28

(xv)           
as to which the applicable Originator has satisfied and fully
performed all obligations on its part with respect to such Receivable required
to be fulfilled by it, and no further action is required to be performed by any
Person with respect thereto other than payment thereon by the applicable
Obligor (excluding any warranty obligations for which no claim exists or is
know to exist), and

(xvi)          
as to which each of the representations and warranties
contained in Sections 2.1(i), (l) and (s) is true and correct.

"ERISA" means the Employee
Retirement Income Security Act of 1974, as amended from time to time, and any
rule or regulation issued thereunder.

"ERISA Affiliate" means any trade or
business (whether or not incorporated) under common control with any Originator
within the meaning of Section 414(b) or (c) of the Code (and Sections 414(m)
and (o) of the Code for purposes of provisions relating to Section 412 of the
Code).

"ERISA Event" means (a) a Reportable
Event with respect to a Pension Plan; (b) a withdrawal by any Originator or any
ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA during a
plan year in which it was a substantial employer (as defined in Section 4001
(a) (2) of ERISA) or a cessation of operations which is treated as such a
withdrawal under Section 4062(e) of ERISA; (c) a complete or partial withdrawal
by any Originator or any ERISA Affiliate from a Multiemployer Plan or
notification that a Multiemployer Plan is in reorganization; (d) the filing of
a notice of intent to terminate, the treatment of a Plan amendment as a
termination under Section 4041 or 4041A of ERISA, or the commencement of
proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e)
an event or condition which might reasonably be expected to constitute grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan or Multiemployer Plan; or (f) the
imposition of any liability under Tide IV of ERISA, other than PBGC premiums
due but not delinquent under Section 4007 of ERISA, upon any Originator or any
ERISA Affiliate.

"Event of Bankruptcy" shall be
deemed to have occurred with respect to a Person if either:

29

(a) a case or other proceeding shall be commenced,
without the application or consent of such Person, in any court, seeking the
liquidation, reorganization, debt arrangement, dissolution, winding up, or
composition or readjustment of debts of such Person, the appointment of a
trustee, receiver, custodian, liquidator, assignee, sequestrator or the like
for such Person or all or substantially all of its assets, or any similar
action with respect to such Person under any law relating to bankruptcy,
insolvency, reorganization, winding up or composition or adjustment of debts,
and such case or proceeding shall continue undismissed, or unstayed and in
effect, for a period of 60 consecutive days; or an order for relief in respect
of such Person shall be entered in an involuntary case under the federal
bankruptcy laws or other similar laws now or hereafter in effect; or

(b) such Person shall commence a voluntary case or
other proceeding under any applicable bankruptcy, insolvency, reorganization,
debt arrangement, dissolution or other similar law now or hereafter in effect,
or shall consent to the appointment of or taking possession by a receiver,
liquidator, assignee, trustee (other than a trustee under a deed of trust,
indenture or similar instrument), custodian, sequestrator (or other similar
official) for, such Person or for any substantial part of its property, or
shall make any general assignment for the benefit of creditors, or shall be
adjudicated insolvent, or admit in writing its inability to pay its debts
generally as they become due, or, if a corporation or similar entity, its board
of directors shall vote to implement any of the foregoing.

"Excluded Receivable"  
means a
Receivable for which (i) any of Kmart Corporation (including without
limitation, Kmart Corporation d/b/a Kmart Fashions), Builders Square, Inc. or
Sourcing & Technical Services, Inc., is the Obligor and (ii) any Obligor
which is an Obligor designated in writing by an Originator to Buyer and
approved in writing by the Administrative Agent and the Co-Agents with respect
to Receivables owing by such Obligor that arises on or after the date specified
such written approval of such designation.

"Factored Receivable"  
means, with
respect to any Originator, any right to payment for goods sold or services
performed by such Originator existing on or after the Initial Cutoff Date which
is sold or pledged to any factor and designated on such Originator's accounting
system with code "C", "D", "S", "1" or any other code identified as such in
writing by the Originator to the Buyer (and, as long as the Credit and Security
Agreement remains in effect, the Administrative Agent as the Buyer's assignee),
or which directs that payment be made to a Person other than the Buyer.

"Finance Charges" means, with
respect to any Contract, any finance, interest, late payment charges or similar
charges owing by an Obligor pursuant to such Contract.

"Indebtedness" of a Person means
such Person's (i) obligations for borrowed money, (ii) obligations representing
the deferred purchase price of property or services (other than accounts payable
arising in the ordinary course of such Person's business payable on terms
customary in the trade), (iii) obligations, whether or not assumed, secured by
liens or payable out of the proceeds or production from property now or
hereafter owned or acquired by such Person, (iv) obligations which are
evidenced by notes, acceptances, or other instruments, (v) capitalized lease
obligations, (vi) net liabilities under interest rate swap, exchange or cap
agreements, (vii) Contingent Obligations and (viii) liabilities in respect of
unfunded vested benefits under plans covered by Title IV of ERISA.

30

"Initial Cutoff Date" means, as to
each Originator, the close of business on the Business Day immediately prior to
the date on which such Originator became a party to this Agreement.

"Invoice"  means any paper or
electronic invoice evidencing any Receivable.

"Lock-Boxes" means those lock-boxes
shown on Exhibit III, as the same may be amended from time to time by
the Buyer in accordance with the terms hereof.

"Material Adverse Effect" means a
material adverse effect on (i) the financial condition or results of operations
of Parent and its Subsidiaries, considered as a whole, (ii) the ability of any
Originator to perform its obligations under this Agreement or any other Transaction
Document to which such Originator is a party, (iii) the legality, validity or
enforceability of this Agreement or any other Transaction Document to which
such Originator is a party, (iv) any Originator's, the Buyer's, any Agent's or
any Lender's interest in the Receivables generally or in any significant
portion of the Receivables or the Related Security with respect thereto, or (v)
the collectibility of the Receivables generally or of any significant portion
of the Receivables.

"Material Subsidiary"  
means, as of
the date of any determination thereof, any Subsidiary that either:  (a) owns assets having a book value equal to
or greater than 5% of the consolidated total assets shown on the consolidated
balance sheet of Parent and its consolidated subsidiaries, or (b) had net
income for any prior period of four consecutive fiscal quarters equal to or
greater than 5% of the Parent's and its consolidated subsidiaries consolidated
net income shown on the statements of earnings for the same four fiscal quarter
period.

"Mohawk Distribution" has the
meaning set forth in the preamble to the Agreement.

"Monthly Reporting Date"  
means the
18th day of each calendar month hereafter (or if any such day is not a Business
Day, the next succeeding Business Day thereafter).

"Multiemployer Plan" means a
"multiemployer plan," within the meaning of Section 4001(a)(3) of ERISA, to
which any Originator or any ERISA Affiliate makes, is making, or is obligated
to make contributions or, during the preceding three calendar years, has made,
or been obligated to make, contributions.

"Obligor" means a Person obligated
to make payments on a Receivable.

"Organizational Documents" means,
for any Person, the documents for its formation and organization, which, for
example, (a) for a corporation are its corporate charter and bylaws,
(b) for a partnership are its certificate of partnership (if applicable)
and partnership agreement, (c) for a limited liability company are its
certificate of formation or organization and its operating agreement,
regulations or the like and (d) for a trust is the trust agreement,
declaration of trust, indenture or bylaws under which it is created.

31

"Original Balance" means, with
respect to any Receivable coming into existence after the Initial Cutoff Date,
the Outstanding Balance of such Receivable on the date it was created.

"Originator" has the meaning set
forth in the preamble to the Agreement.

"Other Records" means, with respect
to any Receivable:  (a) all Contracts
and (b) all other documents, books, records and other information (including,
without limitation, computer programs, tapes, disks, punch cards, data
processing software and related property and rights) relating to the
creditworthiness of any Obligor in respect thereof.

"Outstanding Balance" of any Receivable
at any time means the then outstanding principal balance thereof.

"Parent" means Mohawk Industries,
Inc., a Delaware corporation, and its successors.

"PBGC" means the Pension Benefit
Guaranty Corporation, or any successor thereto.

"Pension Plan" means a pension plan
(as defined in Section 3(2) of ERISA) subject to Title IV of ERISA which any
Originator sponsors or maintains, or to which it makes, is making, or is
obligated to make contributions, or in the case of a multiple employer plan (as
described in Section 4064(a) of ERISA) has made contributions at any time
during the immediately preceding five plan years.

"Person" means an individual,
partnership, corporation (including a business trust), limited liability
company, joint stock company, trust, unincorporated association, joint venture
or other entity, or a government or any political subdivision or agency
thereof.

"Plan" means an employee benefit
plan (as defined in Section 3(3) of ERISA) which any Originator or any of its
ERISA Affiliates sponsors or maintains or to which any Originator or any of its
ERISA Affiliates makes, is making, or is obligated to make contributions and
includes any Pension Plan, other than a Plan maintained outside the United
States primarily for the benefit of Persons who are not U.S. residents.

"Purchase" means the purchase by the
Buyer from an Originator pursuant to Section 1.1(a) of the Agreement of
the Receivables originated by such Originator and the Related Security related
thereto, together with all related rights in connection therewith.

"Purchase Price" means, with respect
to the Purchase from each Originator, the aggregate price to be paid by the
Buyer to such Originator for such Purchase in accordance with Section 1.2
of the Agreement for the Receivables originated by such Originator and the
associated Related Security being sold to the Buyer, which price shall equal on
any date (i) the product of (x) the Outstanding Balance of such Receivables on
such date, multiplied by (y) one minus the Discount Factor
in effect on such date, minus (ii) any Purchase Price Credits to be credited
against the Purchase Price otherwise payable in accordance with Section 1.3
of the Agreement.

32

"Purchase Price Credit" has the
meaning set forth in Section 1.3 of the Agreement.

"Purchase Report" has the meaning
set forth in Section 1.1(b) of the Agreement.

"Rating Agency Condition" means, at
any time the Credit and Security Agreement remains in effect, the Rating Agency
Condition as defined therein.

"Receivable" means all indebtedness
and other obligations owed to an Originator, at the times it arises and before
giving effect to any transfer or conveyance under the Agreement, arising in
connection with the sale of goods or the rendering of services by such
Originator or a predecessor (including, without limitation, any indebtedness,
obligation or interest constituting an account, instrument, chattel paper or
general intangible, if any) together with the obligation, if any, to pay any
Finance Charges with respect thereto and all proceeds thereof; provided,
however, in no event shall the term "Receivable" include any
Factored Receivable, Excluded Receivable or any Receivable coming into
existence after the Termination Date. 
All Receivables are identified with the legend pay to Buyer or similar
language.  For purposes of this
Agreement, indebtedness and other rights and obligations arising from any one
transaction, including, without limitation, indebtedness and other rights and
obligations represented by an individual invoice, shall constitute a Receivable
separate from a Receivable consisting of the indebtedness and other rights and
obligations arising from any other transaction; provided, further,
that any indebtedness, rights or obligations referred to in the immediately
preceding sentence shall be a Receivable regardless of whether the account
debtor or such Originator treats such indebtedness, rights or obligations as a
separate payment obligation.

"Related Security" means, with
respect to any Receivable:

(i)         all of the applicable Originator's interest, if any, in the
goods (including returned or repossessed goods), the sale of which by such
Originator gave rise to such Receivable,

(ii)        all other security interests or liens and property subject
thereto from time to time, if any, purporting to secure payment of such
Receivable, together with all financing statements and security agreements
describing any collateral securing such Receivable,

(iii)       all guaranties, letters of credit, credit insurance and other
agreements or arrangements of whatever character from time to time supporting
payment of such Receivable,

33

(iv)       all service contracts and agreements, if any, associated with
such Receivable,

(v)        all Collections and Collection Records related to such
Receivable, and

(vi)       all other proceeds and insurance proceeds of any of the
foregoing or of any Receivable.

"Reportable Event" means any of the
events set forth in Section 4043(c) of ERISA or the regulations thereunder,
other than any such event for which the 30-day notice requirement under ERISA
has been waived in regulations issued by the PBGC.

"Responsible Financial Officer"  
of
Parent means any of its chief financial officer, vice president & corporate
controller or vice president & treasurer, acting singly.

"Servicer" means Mohawk Servicing, Inc.
and its permitted successors and assigns.

"Settlement Date" means the second
Business Day after each Monthly Reporting Date.

"Subsidiary" of a Person means (i)
any corporation more than 50% of the outstanding securities having ordinary
voting power of which shall at the time be owned or controlled, directly or
indirectly, by such Person or by one or more of its Subsidiaries or by such
Person and one or more of its Subsidiaries, or (ii) any partnership,
association, limited liability company, joint venture or similar business
organization more than 50% of the ownership interests having ordinary voting
power of which shall at the time be so owned or controlled.

"Termination Date" means the
earliest to occur of (i) the date on which the Buyer is unable to pay the
Purchase Price for any Receivable in accordance with Section 1.2, (ii)
the Business Day immediately prior to the occurrence of a Termination Event set
forth in Section 5.1(d), (iii) the Business Day specified in a written
notice from the Buyer (or, at any time the Credit and Security Agreement
remains in effect, the Administrative Agent as the Buyer's assignee) to the
Originators following the occurrence of any other Termination Event, (iv) the
date which is 5 Business Days after the Buyer's receipt of written notice from
any Originator that it wishes to terminate sales under this Agreement, and (v)
the date which is 5 Business Days after each Originator receives written notice
that the Buyer wishes to terminate purchases under this Agreement.

"Termination Event" has the meaning
set forth in Section 5.1 of the Agreement.

"Transaction Documents" means,
collectively, this Agreement, the Collection Services Agreement, and all
Purchase Reports.

"Unmatured Termination Event" means
an event which, with the passage of time or the giving of notice, or both,
would constitute a Termination Event.

34

All accounting terms not specifically
defined herein shall be construed in accordance with GAAP.  All terms used in Article 9 of the UCC in
the State of Georgia, and not specifically defined herein, are used herein as
defined in such Article 9.

 

35

Exhibit II

 

Places of
Business; Locations of Collection Records;

Federal Employer
Identification Number(s); Organizational  

Identification
Number; Other Names

Places of Business:

Mohawk Carpet Distribution, L.P.

160 S. Industrial Blvd.  

Calhoun, GA 30703

Dal-Tile Corporation

160 S. Industrial Blvd.  

Calhoun, GA 30703

Location of Collection Records:

 Mohawk Servicing, Inc

235 Industrial Blvd.  

Chatsworth, GA 30705

Mohawk Servicing, Inc.  

160 S. Industrial Blvd.

Calhoun, GA 30703

Federal Employer Identification Number

and Organizational Identification Number:

 

Mohawk Carpet Distribution, L.P.

FEI # 582173403

Organizational ID# 
3467750

Dal-Tile Corporation

FEI# 16-0577180

Organizational ID#  
002607239

Legal, Trade and Assumed Names:

 36

Alladin Mills

World Carpet

Mohawk Commercial

IMAGE

Galaxy

Merit Hospitality

Custom Weave

Wunda Weave

Mohawk International

Karastan

Alliance Pad

Crown Craft

Mohawk Carpet

World

Diamond

Durkan Patterned Carpet

Rug & Textile Group

Aladdin Rug

Townhouse

Newmark & James

Durkan Commercial

American Rug Craftsman

Horizon

Alexander Smith

Bigelow

Harbinger

Helios

Delaware Valley Wool Scouring

American Weavers

Burton Rug

Insignia

Sunrise

Hamilton

Cyboney

Mohawk Rug & Textile

Ultra Weave

37

Exhibit III

Lock-Boxes and
Collection Accounts

	
  BUYER'S

  LOCK-BOX

   

  	
  RELATED COLLECTION ACCOUNT OF BUYER

  
	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   

	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   
	
   	
   

The foregoing may be changed by
the Buyer at any time upon 30 days prior written notice to each Originator.

 

39

Exhibit IV

 

Form of Compliance
Certificate

This Compliance Certificate is furnished pursuant to that
certain Amended and Restated Receivables Purchase and Sale Agreement dated as
of August 4, 2003, among Mohawk Carpet Distribution, L.P., Dal-Tile
Corporation, and each other Originator that is a party thereto from time to
time and Mohawk Factoring, Inc. (as amended, restate or otherwise modified from
time to time in accordance with the Transaction Documents, the "Agreement").  Capitalized terms used and not otherwise
defined herein are used with the meanings attributed thereto in the Agreement.

THE UNDERSIGNED HEREBY CERTIFIES THAT:

1.         I am the
duly elected ______________ and, accordingly, a Responsible Financial Officer,
of Mohawk Industries, Inc., a Delaware corporation (the "Parent").

2.         I have
reviewed the terms of the Agreement and I have made, or have caused to be made
under my supervision, a detailed review of the transactions and conditions of
Parent and its Subsidiaries during the accounting period covered by the
attached financial statements.

3.         The
examinations described in paragraph 2 did not disclose, and I have no knowledge
of, the existence of any condition or event which constitutes a Termination
Event or an Unmatured Termination Event, as each such term is defined under the
Agreement, during or at the end of the accounting period covered by the
attached financial statements or as of the date of this Certificate[, except as set forth below].

[4.        Described below are the exceptions, if
any, to paragraph 3 by listing, in detail, the nature of the condition or
event, the period during which it has existed and the action which Parent and
its Subsidiaries have taken, is taking, or proposes to take with respect to
each such condition or event: 
_______________________________].

The foregoing certifications, together with the
computations set forth in Schedule I hereto and the financial statements
delivered with this Certificate in support hereof, are made and delivered this
____ day of ______________, 200_.

______________________________

[Name]

40

Exhibit V

Credit and
Collection Policy

 

[attach copy]

 

41

Exhibit VI

 

[Form of]
Purchase Report

 

For the Calculation Period beginning [date] and ending [date]

-------

 

To:  the buyer

cc:  (WHILE THE CREDIT AND SECURITY AGREEMENT
REMAINS IN EFFECT) the agent

from:  [INSERT ORIGINATOR NAME]

	

  	

  	

  	
   

  
	
  Aggregate Outstanding Balance of
  all Receivables sold during the period:

  	

  $_____________

  	

  	
   

  A

  
	
  Less:  Aggregate
  Outstanding Balance of all Receivables sold during such period which were not
  Eligible Receivables on the date when sold:

  	

  ($____________)

  	

  	
   

   

   

  (B)

  
	
  Equals:  Aggregate
  Outstanding Balance of all Eligible Receivables sold during the period (A -
  B):

  	

  	

  $___________

  	
   

   

  =C

  
	
  Less:   Purchase
  Price discount during the Period:

  	

  ($____________)

  	

  	
   

  (D)

  
	
  Equals:   Gross
  Purchase Price Payable during the period (C - D)

  	

  	

  $____________

  	
   

  =E

  
	
  Less:   Total
  Purchase Price Credits arising during the Period:

  	

  ($____________)

  	

  	
  (F)

  
	
  Equals:   Net
  Purchase Price payable during the Period (E - F):

  	

  	

  $____________

  	
   

  =G

  
	

  	

  	

  	
   

  
	
  Cash Purchase Price Paid to
  Originator during the Period:

  	

  $_____________

  	

  	
  H

  

The undersigned hereby represents and warrants that the information set forth
above is accurate and complete as of the last day of the Calculation Period set
forth above.

[ORIGINATOR NAME]

By: 
_____________________________
                                    Name:
                                    Title:

42

Schedule A

 

DOCUMENTS TO BE
DELIVERED TO BUYER

ON OR PRIOR TO THE
INITIAL PURCHASE OF RECEIVABLES

 

1.      Executed
copies of the Receivables Purchase and Sale Agreement, duly executed by the
parties thereto.

2.      Copy
of each Credit and Collection Policy of each Originator to attach to the
Receivables Purchase and Sale Agreement as an Exhibit.

3.      A
certificate of each Originator's [Assistant] Secretary certifying:

(a) A copy of the Resolutions of the Board of
Directors of such Originator, authorizing Originator's execution, delivery and
performance of the Receivables Purchase and Sale Agreement and the other
documents to be delivered by it thereunder;

(b) A copy of the Organizational Documents of such
Originator (also certified, to the extent that such documents are filed with
any governmental authority, by the Secretary of State of the jurisdiction of
organization of such Originator on or within thirty (30) days prior to
closing);

(c) Good Standing Certificates for such Originator
issued by the Secretaries of State of its state of incorporation and the State
of Georgia; and

(d) The names and signatures of the officers
authorized on its behalf to execute the Receivables Purchase and Sale Agreement
and any other documents to be delivered by it thereunder.

4.      Pre-filing
state and federal tax lien, judgment lien and UCC lien searches against each
Originator from the following jurisdictions:  

a.         State of
Delaware

b.         Superior
Court Clerk's Cooperative Authority (State of Georgia)

c.         Superior
Court Clerk's Office in the following Georgia Counties:

            (i)         Gordon

5.      Duly
executed UCC financing statements, in form appropriate for filing in all jurisdictions
as may be necessary or, in the opinion of the Buyer (or, at any time the Credit
and Security Agreement remains in effect, the Administrative Agent as the
Buyer's assignee), desirable, under the UCC of all appropriate jurisdictions or
any comparable law in order to perfect the transfer of the ownership interests
contemplated by the Receivables Purchase and Sale Agreement.

43

6.      Duly
executed UCC termination statements, in form suitable for filing, if any,
necessary to release all security interests and other rights of any Person in
the Receivables, Contracts or Related Security previously granted by each
Originator.

7.      A
favorable opinion of legal counsel for each Originator licensed to give
opinions under Georgia law reasonably acceptable to the Buyer (and the
Administrative Agent, as the Buyer's assignee) as to the following:

(a)        Such
Originator is a corporation duly organized, validly existing, and in good
standing under the laws of the State of Delaware.

(b)        Such
Originator has all requisite authority to conduct its business in the
jurisdiction where it maintains its chief executive office.   

(c)        The
execution and delivery by such Originator of the Receivables Purchase and Sale
Agreement and each other Transaction Document to which it is a party and its performance
of its obligations thereunder have been duly authorized by all necessary
organizational action and proceedings on the part of such Originator and will
not:

(i)         require
any action by or in respect of, or filing with, any governmental body, agency
or official (other than the filing of UCC financing statements);

(ii)        contravene,
or constitute a default under, any provision of applicable law or regulation or
of its articles or certificate of incorporation or bylaws or of any agreement,
judgment, injunction, order, decree or other instrument binding upon such
Originator; or  

(iii)       result
in the creation or imposition of any Adverse Claim on assets of such Originator
or any of its Subsidiaries (except as contemplated by the Receivables Purchase
and Sale Agreement).

(d)        The
Receivables Purchase and Sale Agreement and each other Transaction Document to
which it is a party has been duly executed and delivered by such Originator and
constitutes the legally valid, and binding obligation of such Originator enforceable
in accordance with its terms, except to the extent the enforcement thereof may
be limited by bankruptcy, insolvency or similar laws affecting the enforcement
of creditors' rights generally and subject also to the availability of
equitable remedies if equitable remedies are sought.

(e)        In the
event that the Receivables Purchase and Sale Agreement is held to create a
transfer for security purposes rather than a true sale or other outright
assignment, the provisions of the Receivables Purchase and Sale Agreement are
effective to create valid security interests in favor of the Buyer in all of
such Originator's right, title and interest in and to the Receivables described
therein which constitute "accounts," "chattel paper" or "general intangibles"
(each as defined in the UCC) (collectively, the "Opinion Collateral").

44

(f)         Upon
filing of such UCC-1 Financing Statements in such filing offices and payment of
the required filing fees, the security interest in favor of the Buyer in the
Opinion Collateral will be perfected and assigned of record to the
Administrative Agent.

(g)        Based
solely on our review of the UCC Search Reports and assuming (i) the filing of
the Financing Statements and payment of the required filing fees in accordance
with paragraph (f) and (ii) the absence of any intervening filings between the
date and time of the Search Reports and the date and time of the filing of the
Financing Statements and other customary exhibits, the security interest of the
Buyer in the Opinion Collateral is prior to any security interest granted in
the Opinion Collateral by such Originator, the priority of which is determined
solely by the filing of a financing statement in the [describe filing offices].

(h)        To the
best of the opinion giver's knowledge, there is no action, suit or other
proceeding against such Originator which would materially adversely affect the
ability of such Originator to perform its obligations under the Receivables
Purchase and Sale Agreement.

(i)         Such
Originator is not an "investment company" as such term is defined in the
Investment Company Act of 1940, as amended.

8.      A
"true
sale" opinion and "substantive consolidation" opinion
of counsel for Originator with respect to the transactions contemplated by the
Receivables Purchase and Sale Agreement.

9.      A
Certificate of a Responsible Financial Officer of each Originator certifying
that, as of the closing date or, if applicable, as of the date such Originator
becomes a party to the Receivables Purchase and Sale Agreement, no Termination
Event or Unmatured Termination Event exists and is continuing.

10.  Executed copies of
(i) all consents from and authorizations by any Persons and (ii) all waivers
and amendments to existing credit facilities, that are necessary in connection
with the Receivables Purchase and Sale Agreement.

11.  A copy of the
Servicing Agreement duly executed by the parties thereto.

45

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