Document:

FIVE YEAR CREDIT AGREEMENT

Exhibit 10.1

EURO 130,000,000

FIVE YEAR CREDIT AGREEMENT

 

dated as of November 8, 2005

by and among

MOHAWK INTERNATIONAL HOLDINGS S.À R.L.,

as Borrower,

MOHAWK INDUSTRIES, INC.,

as Guarantor,

the Banks referred to herein,

and

KBC BANK NV,

as Administrative Agent and the Issuer 

NY:791404.13

Table of Contents

Page

Article I
DEFINITIONS       2

SECTION 1.01. Definitions 2

SECTION 1.02. Accounting Terms and Determinations                14

SECTION 1.03. References 14

SECTION 1.04. Use of Defined Terms              14

SECTION 1.05. Terminology              14

SECTION 1.06. Determination of Amounts     14

Article II THE CREDITS     15

SECTION 2.01. Commitments to Lend              15

SECTION 2.02. Method of Borrowing Syndicated Loans             15

SECTION 2.03. Continuation Elections            16

SECTION 2.04. [Reserved]. 16

SECTION 2.05. Maturity of Loans.   16

SECTION 2.06. Interest Rates            17

SECTION 2.07. Fees            17

SECTION 2.08. Optional Termination or Reduction of Commitments         18

SECTION 2.09. Termination of Commitments  18

SECTION 2.10. Optional Prepayments             18

SECTION 2.11. Mandatory Prepayments         19

SECTION 2.12. General Provisions as to Payments       19

SECTION 2.13. Computation of Interest and Fees         19

SECTION 2.14. Letters of Credit        19

SECTION 2.15. Availability of Ancillary Facilities         22

SECTION 2.16. Terms of Ancillary Facilities   23

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SECTION 2.17. Commitment of an Ancillary Bank         24

SECTION 2.18. Repayment of Ancillary Facility             24

Article III CONDITIONS TO BORROWINGS AND ISSUANCE OF NEW LETTERS
OF CREDIT        25

SECTION 3.01. Conditions to Closing              25

SECTION 3.02. Conditions to All Borrowings and Issuance of Letters
of Credit     25

Article IV REPRESENTATIONS AND WARRANTIES                26

SECTION 4.01. Corporate Existence and Power              26

SECTION 4.02. Corporate and Governmental Authorization; No
Contravention      26

SECTION 4.03. Binding Effect           26

SECTION 4.04. Financial Information               26

SECTION 4.05. No Litigation             27

SECTION 4.06. Compliance with ERISA          27

SECTION
4.07. Taxes          27

SECTION
4.08. Subsidiaries               27

SECTION
4.09. Not an Investment
Company  27

SECTION
4.10. Ownership of Property,
Liens 27

SECTION
4.11. No Default 28

SECTION
4.12. Full Disclosure          28

SECTION 4.13. Environmental Matters.           28

SECTION 4.14. Capital Stock             28

SECTION 4.15. Margin Stock             28

SECTION
4.16. Insolvency 29

SECTION 4.17. Anti-Terrorism Laws.               29

SECTION 4.18. Pari Passu Ranking.  29

Article V COVENANTS      30

SECTION 5.01. Information                30

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SECTION 5.02. Inspection of Property, Books and Records        31

SECTION
5.03. Debt to Capitalization
Ratio    31

SECTION 5.04. Restricted Payments                31

SECTION 5.05. Investments               31

SECTION
5.06. Negative Pledge        32

SECTION
5.07. Maintenance of Existence; Lines of Business     32

SECTION
5.08. Dissolution                33

SECTION 5.09. Consolidation, Mergers, Sales of Assets and
Dissolution                33

SECTION
5.10. Use of Proceeds        33

SECTION
5.11. Compliance with Laws;
Payment of Taxes           33

SECTION
5.12. Insurance   34

SECTION
5.13. Change in Fiscal Year              34

SECTION
5.14. Maintenance of Property        34

SECTION
5.15. Environmental Notices            34

SECTION
5.16. Environmental Matters            34

SECTION
5.17. Environmental Release            34

SECTION
5.18. Debt of Subsidiaries 35

SECTION 5.19. "Know Your Customer"
Checks.           35

Article VI DEFAULTS         36

SECTION 6.01. Events of Default      36

SECTION 6.02. Notice of Default      38

SECTION 6.03. Crediting of Payments and Proceeds    38

Article VII THE AGENT      38

SECTION 7.01. Appointment; Powers and Immunities  38

SECTION 7.02. Reliance by Administrative Agent        39

SECTION 7.03. Defaults      39

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SECTION 7.04. Rights of Administrative Agent and its Affiliates as
a Bank            39

SECTION 7.05. Indemnification         40

SECTION 7.06. Intentionally Omitted.              40

SECTION 7.07. [Reserved]  40

SECTION 7.08. Nonreliance on Administrative Agent and Other Banks   40

SECTION 7.09. Failure to Act            40

SECTION 7.10. Resignation of Administrative Agent.  40

Article VIII CHANGE IN CIRCUMSTANCES; TAXES; COMPENSATION              41

SECTION 8.01. Basis for Determining Interest Rate Inadequate or
Unfair 41

SECTION 8.02. Illegality     41

SECTION 8.03. Increased Cost and Reduced Return     42

SECTION 8.04. Compensation           43

SECTION 8.05. Taxes.         43

SECTION 8.06. Replacement of Banks             44

SECTION 8.07. Alternative Currency Matters                45

Article IX MISCELLANEOUS           46

SECTION 9.01. Notices       46

SECTION 9.02. No Waivers               48

SECTION 9.03. Expenses    48

SECTION 9.04. Indemnification; Waiver of Consequential Damages         48

SECTION 9.05. Sharing of Setoffs     48

SECTION 9.06. Amendments and Waivers     49

SECTION 9.07. Successors and Assigns         50

SECTION 9.08. Confidentiality          52

SECTION 9.09. Representation by Banks        52

SECTION 9.10. Obligations Several  52

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SECTION 9.11. Governing Law          52

SECTION 9.12. Interpretation            52

SECTION 9.13. CONSENT TO JURISDICTION              52

SECTION 9.14. Judgment Currency  53

SECTION 9.15. Counterparts             53

SECTION 9.16. Reversal of Payments              53

SECTION 9.17. Survival of Indemnities            53

SECTION 9.18. Integration 53

SECTION 9.19. Mohawk Credit Agreement Provisions 53

SECTION 9.20. USA Patriot Act.       54

SECTION 9.21. Additional Borrowers.             54

SECTION 9.22. Service of process    54

SECTION 9.23. Severability.               55

Article X GUARANTY AND INDEMNIFICATION       55

SECTION 10.01. Guaranty and Indemnification              55

SECTION 10.02. Guaranty of Payment and Not of Collection      55

SECTION 10.03. Guaranty Absolute 56

SECTION 10.04. Waiver      56

SECTION 10.05. Inability to Accelerate           56

SECTION 10.06. Reinstatement of Guarantied Obligations           56

SECTION 10.07. Subrogation             56

SECTION 10.08. Expenses  56

SECTION 10.09. Cumulative Rights  56

SECTION 10.10. Nature of Rights     57

Exhibits

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EXHIBIT A           Form of
Opinion of Counsel for the Administrative Agent on behalf of the Banks

EXHIBIT B            Form of
Opinion of Counsel for the Borrower

EXHIBIT C            Form of
Assignment and Acceptance

EXHIBIT D-1        Form of
Notice of Borrowing

EXHIBIT D-2        Form of
Notice of Continuation

EXHIBIT E            Form of
Compliance Certificate

EXHIBIT F            Form of
Accession Letter

Schedules

Schedule 1.01(a)   Commitments
and Lending Offices

Schedule 2.06        Mandatory
Costs

Schedule 4.05        Litigation

Schedule 4.08        Subsidiaries

Schedule 5.06        Existing
Liens

Schedule 9.21        Conditions
Precedent Required To Be Delivered By An Additional Borrower

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NY:791404.13                                                                                                                                                                                         

FIVE YEAR CREDIT AGREEMENT

THIS FIVE YEAR CREDIT
AGREEMENT dated as of November 8, 2005, by and among MOHAWK INTERNATIONAL HOLDINGS
S.À R.L., as Borrower, MOHAWK INDUSTRIES, INC., as Guarantor, KBC BANK NV, as
Administrative Agent, and the other Banks from time to time party hereto.

DEFINITIONS

Definitions. 
The terms as defined in this Section 1.01 shall, for all purposes of
this Agreement and any amendment hereto (except as herein otherwise expressly
provided or unless the context otherwise requires), have the meanings set forth
herein:

"Accession Letter"
means a letter substantially in the form of Exhibit F.

"Additional Borrower"
means a Subsidiary of the Borrower which becomes a Borrower after the date of
this Agreement under Section 9.21 (Additional Borrowers).

"Administrative Agent"
means KBC, in its capacity as administrative agent for the Banks hereunder, and
its successors and permitted assigns in such capacity.

"Affected Bank" has
the meaning set forth in Section 8.06.

"Affiliate" means
(a) with respect to the Guarantor or any of its Subsidiaries, (i) any
Person that directly, or indirectly through one or more intermediaries,
controls the Guarantor (a "Controlling Person"), (ii) any Person
(other than the Guarantor or a Subsidiary) which is controlled by or is under
common control with a Controlling Person, or (iii) any Person (other than
a Subsidiary) of which the Guarantor owns, directly or indirectly, 20% or more
of the common stock or equivalent equity interests; as used in this
clause (a), the term "control" means possession, directly or indirectly,
of the power to direct or cause the direction of the management or policies of
a Person, whether through the ownership of voting securities, by contract or
otherwise, and (b) with respect to any other Person, a Subsidiary or a
Holding Company of such Person or any other Subsidiary of that Holding Company.

"Agreement" means this
Five Year Credit Agreement, together with all amendments and modifications
hereto.  

"Aladdin" means
Aladdin Manufacturing Corporation, a Delaware corporation.

"Alternative Currency"
shall mean (a) Dollars, (b) Sterling, (c) Canadian Dollars and (d) with the
prior written consent of each Bank, any other lawful currency (other than Euros); provided
that such currency is freely convertible into Euros in the European interbank
market.

"Alternative Currency
Amount" shall mean, at any time, with respect to any amount denominated in
Euros, the equivalent amount thereof in the applicable Alternative Currency at
the most favorable spot exchange rate in the Brussels foreign exchange market
for the purchase of such Alternative Currency with Euros, as determined by the
Administrative Agent or the Issuer, as applicable, at approximately 11:00 A.M.
(the time of the Administrative Agent) 2 Business Days prior to the date on
which the foreign exchange computation is made.

"Alternative Currency
Letter of Credit" shall mean any Letter of Credit denominated in an
Alternative Currency.

"Alternative Currency Loan"
shall mean any Syndicated Loan denominated in an Alternative Currency.

"Ancillary Bank" means
a Bank which is making available an Ancillary Facility.

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"Ancillary Commitment"
means, for an Ancillary Bank and an Ancillary Facility, the maximum amount
denominated in Euros which that Ancillary Bank has agreed (whether or not
subject to satisfaction of conditions precedent) to make available under an
Ancillary Facility and which has been authorized as such under Section 2.15
(Ancillary Facilities), to the extent not cancelled, transferred or
reduced under this Agreement.

"Ancillary Facility"
means any facility or financial accommodation denominated in Euros, including
any overdraft, established by a Bank under Section 2.15 (Ancillary
Facilities) as part or all of its Commitments.

 "Ancillary Facility
Document" means any document evidencing an Ancillary Facility.

"Ancillary Outstandings"
means, for an Ancillary Facility at any time, the Euro Amount on that date of
the aggregate of all of the following amounts (as reasonably determined by the
relevant Ancillary Bank) outstanding at that time under that Ancillary
Facility:

(a)           all amounts of
principal then outstanding under any overdraft, cheque drawing or other account
facilities determined on the same basis (whether net or gross) as that for
determining any limit on those facilities imposed by the terms of that
Ancillary Facility;

(b)           the maximum
potential liability (excluding amounts stated to be in respect of interest and
fees) under all guarantees, bonds and letters of credit then outstanding under
that Ancillary Facility; and

(c)           in respect of
any other facility or financial accommodation, such other amount as fairly
represents the aggregate exposure of that Ancillary Bank under that facility or
accommodation, as reasonably determined by that Ancillary Bank from time to
time in accordance with its usual banking practice for facilities or
accommodation of the relevant type.

"Applicable Margin"
means at all times:

for the period commencing on
the Closing Date to and including the first Performance Pricing Determination
Date for each Eurocurrency Loan shall equal 0.40%; and

from and after the first
Performance Pricing Determination Date, for each Eurocurrency Loan, the
percentage determined on each Performance Pricing Determination Date by
reference to the table set forth below with respect to the Guarantor's senior
unsecured long-term debt rating as determined by Moody's and S&P and in
effect as of such date (the "Debt Rating"); provided, that
(i) if either, but not both, of Moody's or S&P shall not have in
effect a Debt Rating, then the lower level corresponding to such single Debt
Rating shall be used, and (ii) if both Moody's and S&P shall not have
in effect a Debt Rating, then the Guarantor and the Banks shall negotiate in
good faith to amend this definition to reflect the unavailability of ratings
and, pending the effectiveness of any such amendment, the Applicable Margin
shall be determined by reference to the Debt Rating most recently in effect
prior to such event.

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   Level

   	
   Debt Rating
   (S&P/Moody's)

   	
   Applicable Margin

   
	
  I

  	
  > A/A2

  	
  0.190%

  
	
  II

  	
  A-/A3

  	
  0.270%

  
	
  III

  	
  BBB+/Baa1

  	
  0.350%

  
	
  IV

  	
  BBB/Baa2

  	
  0.400%

  
	
  V

  	
  BBB-/Baa3

  	
  0.500%

  
	
  VI

  	
  BBB-/Ba1 or BB+/Baa3

  	
  0.550%

  
	
  VII

  	
  < BB+/Ba1

  	
  0.625%

  

Except as otherwise set forth
above, in the event of a split Debt Rating between S&P and Moody's:
(a) if there is a one level difference between the Debt Ratings, then the
level corresponding to the higher Debt Rating shall be used, and (b) if
there is a greater than one level difference between the Debt Ratings, then the
level corresponding to the Debt Rating one level immediately below the higher
Debt Rating shall be used.  The "Performance Pricing Determination Date"
is the Business Day on which a change in the applicable Debt Rating is
announced or is made publicly available.  Any such required change in interest
and fees shall become effective on such Performance Pricing Determination Date,
and shall be in effect until the next Performance Pricing Determination Date, provided
that no fees or interest shall be decreased pursuant hereto or to Section
2.07 if an Event of Default is in existence on any Performance Pricing
Determination Date.

"Approved Investment"
means an Investment in compliance with the Investment Guidelines.

"Asset Securitization"
means any sale, assignment or other transfer by the Guarantor or a Subsidiary
thereof of accounts receivable or other payment obligations owing to the
Guarantor or such Subsidiary or any interest in any of the foregoing, together
in each case with any collections and other proceeds thereof, any collection or
deposit accounts related thereto, and any collateral, guaranties or other
property or claims in favor of the Guarantor or such Subsidiary supporting or
securing payment by the obligor thereon of, or otherwise related to, any such
receivables, payment obligations or other related property.

"Assignee" has the
meaning set forth in Section 9.07(c).

"Assignment and Acceptance"
means an Assignment and Acceptance executed in accordance with Section
9.07(c) in the form of Exhibit C.

"Authority" has the
meaning set forth in Section 8.02.

"Average
Utilization" means, for any calendar quarter, the average daily aggregate
amount of Syndicated Loans and Letter of Credit Obligations outstanding and Ancillary Outstandings of all
Ancillary Facilities during such quarter.

"Banks" means, collectively, each Person executing this Agreement
as a "Bank" (including, without limitation, the Issuer, unless the
context otherwise requires) set forth on the signature pages hereto and each
Person that hereafter becomes a party to this Agreement as a Bank pursuant to Section
9.07(c).

"Borrower" means (i) Mohawk
International Holdings S.à r.l., a société
à responsabilité limitée, organized under
the laws of the Grand Duchy of Luxembourg, and its successors and permitted
assigns and (ii) with respect to Loans made to, or other credit extended to, an
Additional Borrower under this Agreement, a reference to the term
"Borrower" shall be deemed to be a reference to such Additional
Borrower.

"Borrowing" means a
borrowing hereunder consisting of Loans made to the Borrower at the same time
by the Banks pursuant to Article II.  A Borrowing is a "Eurocurrency
Borrowing" if such Loans are Eurocurrency Loans.  

"Business Day" shall
mean a day:

(a)           other than a
Saturday, Sunday or other day on which commercial banks in Brussels, Belgium or
the Grand Duchy of Luxembourg are authorized or required by law to close;

(b)           if such day
relates to any interest rate settings as to a Eurocurrency Loan denominated in
Euros, any fundings, disbursements, settlements and payments in Euros in
respect of any such Eurocurrency Loan, or any other dealings in Euro to be
carried out pursuant to this Agreement in respect of any such Eurocurrency Loan,
which is a TARGET Day;

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(c)           if such day
relates to any interest rate settings as to a Eurocurrency Loan denominated in
a Permitted Currency other than Euros, on which dealings in deposits in the
relevant currency are conducted by and between banks in the London or other
applicable offshore interbank market for such Permitted Currency; and

(d)           if such day
relates to any fundings, disbursements, settlements and payments in a Permitted
Currency other than Euro in respect of a Eurocurrency Loan denominated in a
Permitted Currency other than Euros, or any other dealings in any currency
other than Euros to be carried out pursuant to this Agreement in respect of any
such Eurocurrency Loan (other than any interest rate settings), on which banks
are open for foreign exchange business in the principal financial center of the
country of such Permitted Currency.

"Canadian
Dollar" means, at any time of determination, the then
official currency of Canada.

"Capital Stock" means
any nonredeemable capital stock of the Guarantor or any Consolidated Subsidiary
(to the extent issued to a Person other than the Guarantor), whether common or
preferred.

"Catoosa Co. IRB"
means that issuance of certain bonds by The Development Authority of Catoosa
County, Georgia, pursuant to the terms and conditions set forth in that certain
Indenture of Trust dated as of November 1, 1991.

"CERCLA" means the
Comprehensive Environmental Response Compensation and Liability Act, 42 U.S.C.
§ 9601 et. seq. and its implementing regulations and amendments.

"CERCLIS" means the
Comprehensive Environmental Response Compensation and Liability Inventory
System established pursuant to CERCLA.

"Change of Law" shall
have the meaning set forth in Section 8.02.

"Closing Date" means November
8, 2005.

"Code" means the
Internal Revenue Code of 1986, as amended, or any successor Federal tax code.

"Commitment" means (a)
with respect to each Bank, the amount set forth opposite the name of such Bank
on Schedule 1.01(a) attached hereto, or in the Assignment and Acceptance
by which such Bank became a party hereto, as such amount may be reduced from
time to time pursuant to Sections 2.08 and 2.09 and (b) as to all
Banks, the aggregate commitment of all Banks to make facilities available, as that
amount may be reduced at any time or from time to time pursuant to Sections
2.08 and 2.09.  The aggregate Commitments of all Banks on the
Closing Date shall be €130,000,000. 

"Commitment Percentage"
means, with respect to a Bank, the ratio, expressed as a percentage, of (a) the
amount of such Bank's Commitment to (b) the aggregate amount of the Commitments
of all Banks hereunder; provided, however, that if at the time of
determination the Commitments have terminated or been reduced to zero, the
"Commitment Percentage" of each Bank shall be the Commitment Percentage of such
Bank in effect immediately prior to such termination or reduction.

"Compliance Certificate"
has the meaning set forth in Section 5.01(c).

"Consolidated Debt"
means at any date the Debt of the Guarantor and its Consolidated Subsidiaries,
determined on a consolidated basis as of such date.

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"Consolidated Net Income"
means, for any period, the Net Income of the Guarantor and its Consolidated
Subsidiaries for such period as determined on a consolidated basis in
accordance with GAAP, but excluding from the determination thereof (without
duplication) (a) any non-cash extraordinary or non-recurring gains or losses,
(b) non-cash losses or gains from the proposed or actual disposition of
material assets not exceeding $20,000,000 in any fiscal year (c) non-cash
goodwill and intangible asset write-downs and restructuring charges (but
deducting from the determination of Consolidated Net Income for any period,
cash payments made during such period in respect of any goodwill and intangible
asset write-downs or restructuring charges recorded after the Closing Date),
(d) non-cash charges resulting from the vesting or exercise of stock options or
stock appreciation rights granted to management of the Guarantor, (e) non-cash
gains or losses under the Statement of Financial Accounting Standards number
133 and its amendments and (f) any equity interests of the Guarantor or any
Subsidiary in the unremitted earnings of any Person that is not a Subsidiary.
For each of the four Fiscal Quarters following the Closing Date, Consolidated
Net Income shall be calculated on a pro forma basis as if the Unilin
Acquisition had occurred on the first day of such period.

"Consolidated Net Worth"
means at any time Stockholders' Equity but excluding from the determination
thereof (without duplication) the effect of (a) any foreign currency
translation adjustments, (b) any extraordinary or non-recurring, non-cash
losses or gains, (c) non-cash losses or gains under the Statement of Financial
Accounting Standards number 133 and its amendments, (d) non-cash intangible and
material write-downs of assets (but deducting from the determination of
Consolidated Net Worth for any period, cash payments made during such period in
respect of any write-downs recorded after the Closing Date) not exceeding
$20,000,000 in any Fiscal Year and (e) non-cash charges resulting from the
vesting or exercise of stock options or stock appreciation rights granted to
management of the Borrower.

"Consolidated Subsidiary"
means at any date any Subsidiary or other entity the accounts of which, in
accordance with GAAP, would be consolidated with those of the Guarantor in its
consolidated financial statements as of such date.

"Consolidated Tangible
Assets" means, at any time, without duplication, Consolidated Total Assets,
excluding therefrom all items that are treated as goodwill and other intangible
assets under GAAP.

"Consolidated Total Assets"
means, at any time, without duplication, (a) the total assets of the Guarantor
and its Consolidated Subsidiaries, determined on a consolidated basis, as set
forth or reflected on the most recent consolidated balance sheet of the
Guarantor and its Consolidated Subsidiaries, prepared in accordance with GAAP,
plus (b) the accounts receivable balance reported as of the last day of the
Fiscal Quarter most recently ended by the Guarantor or a Subsidiary with
respect to an Asset Securitization. Consolidated Total Assets shall be
calculated on a pro forma basis to include the Unilin Acquisition.

"Consolidated Total Capital"
means, at any time, the sum of the following as of such time (a) Consolidated
Net Worth, and (b) Consolidated Debt.

"Controlled Group"
means all members of a controlled group of corporations and all trades or
businesses (whether or not incorporated) under common control which, together
with the Guarantor, are treated as a single employer under Section 414 of the
Code.

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"Debt" of any Person
means at any date, without duplication, all of the following as of such date (a)
all obligations of such Person for borrowed money, (b) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (c)
all obligations of such Person to pay the deferred purchase price of property
or services, except trade accounts payable arising in the ordinary course of
business, (d) all obligations of such Person as lessee under capital leases,
(e) all obligations of such Person to reimburse any bank or other Person in
respect of amounts payable under a banker's acceptance, (f) all Redeemable Preferred
Stock of such Person (in the event such Person is a corporation), (g) all
obligations of such Person to reimburse any bank or other Person in respect of
amounts paid under a letter of credit or similar instrument (provided, however,
solely with respect to commercial letters of credit, such amounts shall be
included hereunder only to the extent that they exceed $5,000,000 in the
aggregate), (h) all Debt of others secured by a Lien on any asset of such
Person, whether or not such Debt is assumed by such Person, (i) all obligations
of such Person with respect to Hedging Agreements (valued as the termination
value thereof computed in accordance with a method approved by the
International Swap Dealers Association and agreed to by such Person in the
applicable Hedging Agreement, if any) (provided, however, solely
with respect to Hedging Agreements entered into in the ordinary course of
business for natural gas or any other fuels used for the same purposes, such
obligations shall be included hereunder only to the extent that they exceed
$100,000,000 in the aggregate), (j) all Debt of others Guaranteed by such
Person, and (k) the outstanding attributed principal amount under any Asset
Securitization. For all purposes of this Agreement, the amount of a Person's Debt
under a loan or lease agreement between such Person and a governmental agency
that has issued industrial development bonds or similar instruments, the
repayment of which is secured by the payment obligations of such Person under
such loan or lease agreement, shall be equal to the aggregate principal amount
of such bonds or instruments outstanding at the time of determination less the
amount of proceeds of such bonds or instruments which at such time are on
deposit with a trustee or other fiduciary in a "construction" fund, or other
similar fund which would be available to such trustee or other fiduciary to
repay the bonds or other instruments if then due and payable.

"Debt to Capitalization
Ratio" means the ratio of Consolidated Debt to Consolidated Total Capital.

"Debt Rating" has the
meaning set forth in the definition of Applicable Margin.

"Default" means any
condition or event which constitutes an Event of Default or which with the
giving of notice or lapse of time or both would, unless cured or waived, become
an Event of Default.

"Default Rate" means,
with respect to any Loan, on any day, the sum of 2% plus the then highest
interest rate (including the Applicable Margin) which may be applicable to any
Loans hereunder, including, without limitation, under Section 8.06
(irrespective of whether any such class of Loans are actually outstanding
hereunder).

"Dollars" or "$"
means dollars in lawful currency of the United States of America.

"EMU" shall mean
economic and monetary union as contemplated in the Treaty on European Union.

"EMU Legislation"
shall mean legislative measures of the Council of European Union for the
introduction of, change over to or operation of the Euro.

"Environmental Authority"
means any foreign, federal, state, local or regional government that exercises
any form of jurisdiction or authority under any Environmental Requirement.

"Environmental Judgments
and Orders" means all judgments, decrees or orders arising from or in any
way associated with any Environmental Requirements, whether or not entered upon
consent or written agreements with an Environmental Authority or other entity
arising from or in any way associated with any Environmental Requirement,
whether or not incorporated in a judgment, decree or order.

"Environmental Liabilities"
means any liabilities, whether pending or, to the knowledge of the Guarantor,
the Borrower or any Subsidiary threatened, arising from and in any way
associated with any Environmental Requirements and which would have or create a
reasonable possibility of causing a Material Adverse Effect.

"Environmental Notices"
means notice from any Environmental Authority or by any other person or entity,
of possible or alleged noncompliance with or liability under any Environmental
Requirement, including without limitation any complaints, citations, demands or
requests from any Environmental Authority or from any other person or entity
for correction of any, violation of any Environmental Requirement or any
investigations concerning any violation of any Environmental Requirement.

"Environmental Proceedings"
means any judicial or administrative proceedings arising from or in any way
associated with any Environmental Requirement.

"Environmental Releases"
means releases as defined in CERCLA or under any applicable state or local
environmental law or regulation.

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NY:791404.13                                                                                                                                                                                         

"Environmental
Requirements" means any legal requirement relating to health, safety or the
environment and applicable to any of the Guarantor, the Borrower,  any
Subsidiary, or the Properties, including but not limited to any such
requirement under CERCLA or similar state legislation and all federal, state
and local laws, ordinances, regulations, orders, writs, decrees and common law.

"ERISA" means the U.S.
Employee Retirement Income Security Act of 1974, as amended from time to time,
or any successor law. Any reference to any provision of ERISA shall also be
deemed to be a reference to any successor provision or provisions thereof.

"Euro" or "€"
shall mean the single currency to which the Participating Member States of the
EMU have converted.

"Euro Amount" shall
mean, at any time, (a) with respect to any amount denominated in Euros, such
amount and (b) with respect to any amount denominated in any Alternative
Currency, the equivalent amount thereof in Euros at the most favorable spot
exchange rate for the purchase of Euros with such Alternative Currency, as
determined by the Administrative Agent or the Issuer, as applicable, at
approximately 11:00 A.M. (the time of the Administrative Agent) 2 Business Days
prior to the date on which the foreign exchange computation is made.

"EURIBOR"
means, in relation to any Loan and for a given Interest Period: (a) the
percentage rate per annum equal to the offered quotation shown on Reuters Page
EURIBOR 01 of the Banking Federation of the European Union for the Euro for
such Interest Period at or about 11.00 a.m. (Brussels time) on the Quotation
Date for such period or, if such page or such service shall cease to be
available, such other page or such other service for the purpose of displaying
an average rate of the Banking Federation of the European Union for the Euro as
the Administrative Agent, after consultation with the Banks and the Borrower,
shall select; or (b) if no quotation for the Euro for the relevant
Interest Period is displayed and the Administrative Agent has not selected an
alternative service on which a quotation is displayed, the arithmetic mean
(rounded upwards to four decimal places) of the rates (as notified to the
Administrative Agent) at which each of the Reference Banks was offering to
prime banks in the European interbank market deposits in the Euro of an
equivalent amount and for such Interest Period at or about 11.00 a.m. (Brussels
time) on the Quotation Date for such period.

"Eurocurrency Loan"
means a Loan made pursuant to the terms and conditions set forth in Section
2.01(a).

"Event of Default" has
the meaning set forth in Section 6.01.

"Excluded Taxes" means, with respect to the Administrative Agent,
any Bank, the Issuer or any other recipient of any payment to be made by or on
account of any obligation of the Borrower hereunder, (a) taxes imposed on or
measured by its overall net income (however denominated), and franchise taxes
imposed on it (in lieu of net income taxes), by the jurisdiction (or any
political subdivision thereof) under the laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Bank, in which its applicable Lending Office is located, (b) any branch profits
taxes or any similar tax imposed by any other jurisdiction in which such
recipient is located and (c) in the case of a Foreign Bank (other than an Assignee
pursuant to a request by the Borrower under Section 8.06), any
withholding tax that is imposed on amounts payable to such Foreign Bank at the
time such Foreign Bank becomes a party hereto (or designates a new Lending
Office) or is attributable to such Foreign Bank's failure or inability (other
than as a result of a Change in Law) to comply with Section 8.05(e),
except to the extent that such Foreign Bank (or its assignor, if any) was
entitled, at the time of designation of a new Lending Office (or assignment),
to receive additional amounts from the Borrower with respect to such
withholding tax pursuant to Section 8.05(a).  Excluded Taxes does not
include any withholding tax that is imposed on amounts payable to a Bank by an
Additional Borrower.

"Fed" means the U.S.
Board of Governors of the Federal Reserve System.

"Fiscal Quarter" means
any fiscal quarter of the Guarantor.

"Fiscal Year" means
any fiscal year of the Guarantor.

"Foreign Bank" means any Bank that is organized under the laws of
a jurisdiction other than that in which the Borrower is resident for tax purposes.

8

NY:791404.13                                                                                                                                                                                         

"Galaxy" means Galaxy
Carpet Mills, Inc., a Delaware corporation, which corporation was liquidated
into the Guarantor as successor thereto.

"GAAP" means generally
accepted accounting principles (a) in the case of the Guarantor, as applied in
the United States; or (ii) in the case of the Borrower, as applied in the Grand
Duchy of Luxembourg; and applied on a basis consistent with those which, in
accordance with Section 1.02, are to be used in making the calculations
for purposes of determining compliance with the terms of this Agreement.

"Guarantee" by any
Person means any obligation, contingent or otherwise, of such Person directly
or indirectly guaranteeing any Debt or other obligation of any other Person
and, without limiting the generality of the foregoing, any obligation, direct
or indirect, contingent or otherwise, of such Person (a) to secure, purchase or
pay (or advance or supply funds for the purchase or payment of) such Debt or
other obligation (whether arising by virtue of partnership arrangements, by
agreement to keep‐well, to purchase assets, goods, securities or
services, to provide collateral security, to take‐or‐pay, or to
maintain financial statement conditions or otherwise) or (b) entered into for
the purpose of assuring in any other manner the obligee of such Debt or other
obligation of the payment thereof or to protect such obligee against loss in
respect thereof (in whole or in part); provided that the term Guarantee
shall not include endorsements for collection or deposit in the ordinary course
of business.  The term "Guarantee" used as a verb has a corresponding
meaning.

"Guarantied Obligations" has the meaning set forth in Section 10.01.

"Guarantor" means
Mohawk Industries, Inc., a corporation organized under the laws of the State of
Delaware of the United States, and its successors and permitted assigns.

"Hazardous Materials"
means (a) hazardous waste, as defined in the Resource Conservation and Recovery
Act of 1980, 42 U.S.C. § 6901 et seq. and its implementing regulations and amendments,
or in any applicable state or local law or regulation, (b) "hazardous
substance", "pollutant", or "contaminant" as defined in CERCLA, or in any
applicable state or local law or regulation, (c) gasoline, or any other
petroleum product or by-product, including, crude oil or any fraction thereof,
(d) toxic substances, as defined in the Toxic Substances Control Act of 1976,
or in any applicable state or local law or regulation or (e) insecticides,
fungicides, or rodenticides, as defined in the Federal Insecticide, Fungicide,
and Rodenticide Act of 1975, or in any applicable state or local law or
regulation, as each such Act, statute or regulation may be amended from time to
time.

"Hedging Agreement"
means any interest rate protection agreement, foreign currency exchange
agreement or other agreement or arrangement designed to alter the risks of any
Person arising from fluctuations in interest rates, currency values or
commodity prices.

"Holding Company" of any other Person, means a Person in respect
of which that other Person is a Subsidiary. 

"Indemnified Taxes" means Taxes and Other Taxes other than
Excluded Taxes. 

"Interest Period"
means with respect to each Eurocurrency Borrowing, the period commencing on the
date of such Borrowing and ending on the numerically corresponding day in the
first, second, third, sixth, or, if each Bank consents thereto, twelfth month
thereafter, as the Borrower may elect in the applicable Notice of Borrowing; provided
that:

(a)           any Interest
Period (other than an Interest Period determined pursuant to paragraph (c)
below) which would otherwise end on a day which is not a Business Day shall be
extended to the next succeeding Business Day unless such Business Day falls in
another calendar month, in which case such Interest Period shall end on the
next preceding Business Day;

(b)           any Interest
Period which begins on the last Business Day of a calendar month (or on a day
for which there is no numerically corresponding day in the appropriate
subsequent calendar month) shall, subject to paragraph (c) below, end on the
last Business Day of the appropriate subsequent calendar month; and

9

NY:791404.13                                                                                                                                                                                         

(c)           any Interest
Period which begins before the Termination Date and would otherwise end after
the Termination Date shall end on the Termination Date.

"Investment" means any
investment in any Person, whether by means of purchase or acquisition of
obligations or securities of such Person, capital contribution to such Person,
loan or advance to such Person, making of a time deposit with such Person,
Guarantee or assumption of any obligation of such Person or otherwise.

"Investment Guidelines"
means the guidelines for investment of funds of the Guarantor and the
Subsidiaries as approved by the Board of Directors of the Guarantor or an
authorized executive committee thereof and in effect on the Closing Date, as
modified or supplemented from time to time with the approval of the Board of
Directors of the Guarantor or an authorized executive committee.

"IRS Code" means the
United States Internal Revenue code of 1986, as amended, or any successor
United States tax code.

"Issuer" means the
Administrative Agent.

"KBC" means KBC Bank NV,
and its successors and, as the context requires, its permitted assigns.

"Lending Office"
means, as to each Bank, its office located at its address set forth on Schedule
1.01(a) attached hereto or such other office as such Bank may hereafter
designate as its Lending Office by notice to the Borrower.

"Letter of Credit"
means each standby or commercial letter of credit issued by the Issuer for the
account of the Borrower pursuant to Section 2.14(a).

"Letter of Credit
Application" means an application, in the form specified by the Issuer from
time to time, requesting the Issuer to issue a Letter of Credit.

"Letter of Credit Fee"
means a letter of credit fee in an amount equal to the Applicable Margin for
Eurocurrency Loans multiplied by the average daily amount of the Letter of
Credit Obligations, computed for the actual number of days elapsed on the basis
of a 365 or 366 day year, as applicable.

"Letter of Credit
Obligations" shall mean, at any time, the aggregate unfunded amount of the
outstanding Letters of Credit.

"Lien" means, with
respect to any asset, any mortgage, deed to secure debt, deed of trust, lien,
pledge, charge, security interest, security title, preferential arrangement,
which has the practical effect of constituting a security interest or
encumbrance, or encumbrance or servitude of any kind in respect of such asset
to secure or assure payment of a Debt or a Guarantee, whether by consensual
agreement or by operation of statute or other law.  For the purposes of this
Agreement, the Borrower, Guarantor or any Subsidiary shall be deemed to own
subject to a Lien any asset which it has acquired or holds subject to the
interest of a vendor or lessor under any conditional sale agreement, capital
lease or other title retention agreement relating to such asset.

"Loan" means a
Syndicated Loan and "Loans" means Syndicated Loans.

"Loan Documents" means
this Agreement, including the Guarantee herein, and any other document
evidencing, relating to or securing the Loans, and any other document or
instrument delivered in connection with this Agreement or the Loans, as such
documents and instruments may be amended or modified from time to time. 

"Mandatory Cost" means
the percentage rate per annum calculated by the Administrative Agent in
accordance with Schedule 2.06 (Calculation of the Mandatory Cost).

"Margin Stock" means
"margin stock" as defined in Regulations T, U or X.

10

NY:791404.13                                                                                                                                                                                         

"Material Adverse Effect"
means, with respect to any event, act, condition or occurrence of whatever
nature (including any adverse determination in any litigation, arbitration, or
governmental investigation or proceeding), whether singly or in conjunction
with any other event or events, act or acts, condition or conditions,
occurrence or  occurrences, whether or not related, a material adverse change
in, or a material adverse effect upon, any of (a) the financial condition,
operations, business, properties or prospects of the Guarantor and its
Consolidated Subsidiaries taken as a whole; (b) the rights and remedies of the
Banks under the Loan Documents, or the ability of the Guarantor to perform its
obligations under the Loan Documents to which it is a party, as applicable; or
(c) the legality, validity or enforceability of any Loan Document.

"Mohawk Credit Agreement"
means that 5-Year Credit Agreement dated as of October 28, 2005 among the
Guarantor, Wachovia Bank, National Association, as administrative agent and the
other lenders party thereto from time to time, as amended, restated,
supplemented or otherwise modified from time to time.

"Mohawk Credit Agreement
Default" means any event or condition set forth in Section 6.01
of the Mohawk Credit Agreement.

"Moody's" means Moody's
Investors Service, Inc. and any successor thereto.

"Notice of Borrowing"
has the meaning set forth in Section 2.02.

"Notice of Continuation"
has the meaning set forth in Section 2.03.

"OFAC" means the U.S. Department of the Treasury's Office of
Foreign Assets Control.

"Other Taxes" means all present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies
arising from any payment made hereunder or under any other Loan Document or
from the execution, delivery or enforcement of, or otherwise with respect to,
this Agreement or any other Loan Document. 

"Participant" has the
meaning set forth in Section 9.07(b).

"Participating Member
State" shall mean each state so described in any EMU Legislation.

"PBGC" means the Pension
Benefit Guaranty Corporation or any entity succeeding to any or all of its
functions under ERISA.

"Performance Pricing
Determination Date" has the meaning set forth in the definition of
Applicable Margin.

"Permitted Acquisition"
means a non-hostile acquisition, however structured, of all or substantially
all of the assets of, or a majority of all the issued and outstanding capital
stock of, a Person; provided that the Guarantor will be in compliance with
Section 5.07 after giving effect to such acquisition. The Unilin Acquisition is
a Permitted Acquisition.

"Permitted Currency"
shall mean Euros or any Alternative Currency, or each such currency, as the
context requires.

"Permitted Line of
Business" means businesses in substantially the same fields as the
businesses conducted by the Borrower and its Subsidiaries on the Closing Date
and after giving effect to the Unilin Acquisition (including, without
limitation, the manufacturing, marketing and/or distribution of commercial or
home furnishings and floor coverings and other reasonably related products and
any "vertical integration" with respect thereto) and in lines of business
reasonably related thereto.

"Person" means an
individual, a corporation, a partnership, an unincorporated association, joint
venture, limited liability company, a trust or any other entity or
organization, including, but not limited to, a government or political
subdivision or an agency or instrumentality thereof.

11

NY:791404.13                                                                                                                                                                                         

"Plan" means at any
time an employee pension benefit plan which is covered by Title IV of ERISA or
subject to the minimum funding standards under Section 412 of the Code and is
either (a) maintained by a member of the Controlled Group for employees of any
member of the Controlled Group or (b) maintained pursuant to a collective
bargaining agreement or any other arrangement under which more than one
employer makes contributions and to which a member of the Controlled Group is
then making or accruing an obligation to make contributions or has within the
preceding five plan years made contributions.

"Properties" means all
real property owned, leased or otherwise used or occupied by the Borrower or
any Subsidiary, wherever located.

"Quotation Date"
means, with respect to an Interest Period for a given Syndicated Loan:
(a) if such Loan is denominated in Euro, two TARGET Days before the first
day of such Interest Period; (b) if such Loan is denominated in Sterling,
the first day of such Interest Period; or (c) if such Loan is denominated
in any other Alternative Currency, the date two Business Days before the first
day of such Interest Period.

"Redeemable Preferred
Stock" of any Person means any preferred stock issued by such Person which
is at any time prior to the Termination Date either (a) mandatorily redeemable
(by sinking fund or similar payments or otherwise) or (b) redeemable at the
option of the holder thereof.

"Reference Banks"
means the principal Brussels office of KBC and the principal Brussels office of
ING Luxembourg SA or such other bank or banks as may from time to time be
agreed between the Borrower and the Administrative Agent acting on the
instructions of the Required Banks.

"Register"
has the meaning assigned thereto in Section 9.07(d). 

"Regulation T" means
Regulation T of the Fed, as in effect from time to time, together with all
official rulings and interpretations issued thereunder.

"Regulation U" means
Regulation U of the Fed, as in effect from time to time, together with all
official rulings and interpretations issued thereunder.

"Regulation X" means
Regulation X of the Fed, as in effect from time to time, together with all
official rulings and interpretations issued thereunder.

"Reimbursement Obligations"
means the reimbursement or repayment obligations of the Borrower to the Issuer
pursuant to Section 2.14 with respect to Letters of Credit and the
applicable Letter of Credit Application.

"Replacement Bank" has
the meaning set forth in Section 8.06.

"Required Banks" means
at any time Banks having more than 50% of the aggregate amount of the
Commitments, or if the Commitments are no longer in effect, holding more than
50% of the aggregate outstanding principal amount of the Loans; provided,
however, at any time that there are less than three Banks, the "Required
Banks" shall mean all Banks.  

"Responsible Officer"
means the chief executive officer, president, vice president and general
counsel, chief financial officer, controller or treasurer of, respectively, the
Guarantor or Borrower.  Any document delivered hereunder that is signed by a
Responsible Officer shall be conclusively presumed to have been authorized by
all necessary corporate action on the part of, respectively, the Guarantor or
Borrower, and such Responsible Officer shall be conclusively presumed to have
acted on behalf of, respectively, the Guarantor or Borrower.

12

NY:791404.13                                                                                                                                                                                         

"Restricted Payment"
means (a) any dividend or other distribution on any shares of the Guarantor's
capital stock (except dividends payable solely in shares of its capital stock)
or (b) any payment on account of the purchase, redemption, retirement or
acquisition of (i) any shares of the Guarantor's capital stock (except shares
acquired upon the conversion thereof into other shares of its capital stock) or
(ii) any option, warrant or other right to acquire shares of the Guarantor's
capital stock.

"Revaluation Date"
shall mean (a) with respect to any Alternative Currency Loan, each of the
following: (i) the date of a borrowing of such Alternative Currency Loan, (ii)
each date of a continuation of such Alternative Currency Loan, and (iii) such
additional dates as the Administrative Agent shall reasonably determine or the
Required Banks shall reasonably require; and (b) with respect to any
Alternative Currency Letter of Credit, each of the following: (i) the date of
issuance of such Alternative Currency Letter of Credit, (ii) each date of an
amendment of such Alternative Currency Letter of Credit having the effect of
increasing the amount thereof (solely with respect to the increased amount),
(iii) each date of any payment by the Issuer of any drawing under such
Alternative Currency Letter of Credit, and (iv) such additional dates as the
Administrative Agent or the Issuer shall reasonably determine or the Required
Banks shall reasonably require.

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

"Sterling" shall mean,
at any time of determination, the then official currency of the United Kingdom
of Great Britain and Northern Ireland. 

"Stockholders' Equity"
means, at any time, the stockholders' equity of the Guarantor and its
Consolidated Subsidiaries, as set forth or reflected on the most recent
consolidated balance sheet of the Guarantor and its Consolidated Subsidiaries
prepared in accordance with GAAP and delivered to the Administrative Agent
pursuant to Section 5.01, but excluding any Redeemable Preferred Stock of the
Guarantor or any of its Consolidated Subsidiaries. Shareholders' equity
generally would include, but not be limited to, (a) the par or stated value of
all outstanding Capital Stock, (b) capital surplus, (c) retained earnings, and
(d) various deductions such as purchases of treasury stock, valuation
allowances, receivables due from an employee stock ownership plan, employee
stock ownership plan debt guarantees, and foreign currency translation
adjustments. Stockholders' Equity shall be calculated on a pro forma basis to
include the Unilin Acquisition.

"Subsidiary" means any
corporation or other entity of which securities or other ownership interests
having ordinary voting power to elect a majority of the board of directors or
other persons performing similar functions are at the time directly or
indirectly owned by, as relevant, the Borrower or Guarantor.

"Summerville City IRB"
means that issuance of certain bonds by The Development Authority of the City
of Summerville, Georgia, pursuant to the terms and conditions set forth in that
certain Trust Indenture dated as of September 1, 1997.

 "Syndicated Borrowing"
means any Eurocurrency Loans made to the Borrower pursuant to the terms and
conditions set forth in Section 2.01.

"Syndicated Loans"
means Eurocurrency Loans.

"TARGET Day" shall
mean any day on which the Trans-European Automated Real-time Gross Settlement
Express Transfer (TARGET) payment system (or, if such payment system ceases to
be operative, such other payment system (if any) determined by the
Administrative Agent to be a suitable replacement) is open for the settlement
of payments in Euro.

"Taxes" means all present or future taxes, levies, imposts,
duties, deductions, withholdings, assessments, fees or other charges imposed by
any Authority, including any interest, additions to tax or penalties applicable
thereto.

"Termination Date"
means whichever is applicable of (a) the date that is five (5) years following
the Closing Date, (b) the date the Commitments are terminated pursuant to Section
6.01 following the occurrence of an Event of Default, or (c) the date the
Borrower terminates the Commitments entirely pursuant to Section 2.08.

13

NY:791404.13                                                                                                                                                                                         

"Third Parties" means
all lessees, sublessees, licensees and other users of the Properties, excluding
those users of the Properties in the ordinary course of the Borrower's business
and on a temporary basis.

"Transferee" has the
meaning set forth in Section 9.07(e).

"Treaty on European Union"
shall mean the Treaty of Rome of March 25, 1957, as amended by the Single
European Act of 1986 and the Maastricht Treaty (signed February 7, 1992), as
amended from time to time.

"Unilin Acquisition"
means the acquisition by the Guarantor directly, or through one or more
Subsidiaries, of the outstanding shares of Unilin Holding NV pursuant to the
terms of the Unilin Purchase Agreement.

"Unilin Purchase Agreement"
means the Share Purchase Agreement dated as of July 2, 2005 between Cigales
SAK, as seller, and the Guarantor, as purchaser, as amended from time to time.

"Unused Commitments"
means at any date an amount equal to (a) the aggregate Commitments less
(b) the aggregate outstanding principal amount of the Syndicated Loans less
(c) the Letter of Credit Obligations.

"USA Patriot Act"
means the Uniting and Strengthening America by Providing Appropriate Tools
Required to Intercept and Obstruct Terrorism Act of 2001, Title III of Public
Law 107-56 (signed into law October 26, 2001).  

"Wholly Owned Subsidiary"
means any Subsidiary all of the shares of capital stock or other ownership
interests of which (except directors' qualifying shares) are at the time
directly or indirectly owned by the Guarantor or a Consolidated Subsidiary.

Accounting Terms and Determinations.  Unless otherwise specified herein, all terms of an
accounting character used herein shall be interpreted, all accounting
determinations hereunder shall be made, and all financial statements required
to be delivered hereunder shall be prepared in accordance with GAAP, applied on
a basis consistent (except for changes concurred in by the Guarantor's
independent public accountants or otherwise required by a change in GAAP) with
the most recent audited consolidated financial statements of the Guarantor
delivered to the Banks unless with respect to any such change concurred in by
the Guarantor's independent public accountants or required by GAAP, in
determining compliance with  any of the provisions of any of the Loan
Documents: (a) the Borrower or the Guarantor shall have objected to determining
such compliance on such basis at the time of delivery of such financial
statements, or (b) the Required Banks shall so object in writing within 30 days
after the delivery of such financial statements, in either of which events, the
Banks, the Guarantor and the Borrower shall negotiate in good faith to resolve
any existing disagreements regarding such calculations, provided, that
if such disagreements are not resolved within 30 days after receipt of a notice
of objection, such calculations shall be made on a basis consistent with those
used in the preparation of the latest financial statements as to which such
objection shall not have been made (which, if objection is made in respect of
the first financial statements delivered under Section 5.01 hereof,
shall mean the financial statements referred to in Section 4.04).References.  Unless
otherwise indicated, references in this Agreement to "Articles", "Exhibits",
"Schedules", "Sections" and other Subdivisions are references to articles,
exhibits, schedules, sections and other subdivisions hereof.

Use of Defined Terms

.  All terms defined in this
Agreement shall have the same defined meanings when used in any of the other
Loan Documents, unless otherwise defined therein or unless the context shall
require otherwise.

Terminology

.  All personal pronouns used
in this Agreement, whether used in the masculine, feminine or neuter gender,
shall include all other genders; the singular shall include the plural, and the
plural shall include the singular.  Titles of Articles and Sections in this
Agreement are for convenience only, and neither limit nor amplify the
provisions of this Agreement.

Determination
of Amounts

.  Unless otherwise
specified, for purposes of this Agreement, any determination of the amount of
any outstanding Syndicated Loans, Letter of Credit Obligations or other
obligations payable under this Agreement shall be based upon the Euro Amount of
such outstanding Syndicated Loans, Letter of Credit Obligations or other
obligations payable under this Agreement.

14

NY:791404.13                                                                                                                                                                                         

THE CREDITS

Commitments to Lend

.

Syndicated Loans.  Each Bank severally agrees, on the terms and
conditions set forth herein, to make Syndicated Loans in a Permitted Currency
to the Borrower from time to time before the Termination Date; provided
that, 

immediately after each such
Syndicated Loan is made, the aggregate outstanding principal amount of
Syndicated Loans by such Bank plus the amount of such Bank's Commitment
Percentage of all outstanding Letter of Credit Obligations plus such
Bank's Ancillary Commitments shall not exceed the amount of its Commitment, and

the sum of (x) the aggregate
outstanding principal amount of all Syndicated Loans plus (y) the Letter
of Credit Obligations plus all Ancillary Commitments shall not exceed
the aggregate amount of the Commitments.

Each Syndicated Borrowing
under this Section shall be in an aggregate principal amount of €500,000
or any larger integral multiple of €250,000 (or, in each case, the Alternative
Currency Amount thereof), except that any such Syndicated Borrowing may be in
the aggregate amount of the Unused Commitments, and shall be made from the
several Banks in proportion to their respective Commitment Percentages.  Within
the foregoing limits, the Borrower may borrow under this Section, repay or,
subject to the provisions of Section 2.10, prepay Syndicated Loans
and reborrow under this Section at any time before the Termination Date.

Method of Borrowing Syndicated Loans

.

The Borrower shall give the Administrative
Agent notice (a "Notice of Borrowing"), which shall be substantially in
the form of Exhibit D-1, prior to (i) 11:00 A.M. (the time of
the Administrative Agent) at least one (1) Business Day before each
Eurocurrency Borrowing denominated in Sterling and (ii) 11:00 A.M. (the
time of the Administrative Agent) at least three (3) Business Days before
each Eurocurrency Borrowing denominated in Euros or an Alternative Currency
other than Sterling, specifying:

the date of such Borrowing,
which shall be a Business Day,

the aggregate amount of such
Borrowing,

the duration of the Interest
Period applicable thereto, subject to the provisions of the definition of
Interest Period,

the Permitted Currency in
which such Eurocurrency Borrowing is to be denominated, and

how the proceeds of such
Borrowing are to be made available to the Borrower.

Upon receipt of a Notice of
Borrowing, the Administrative Agent shall promptly notify each Bank of the
contents thereof and of such Bank's Commitment Percentage of such Syndicated
Borrowing and, such Notice of Borrowing, once received by the Administrative
Agent, shall not thereafter be revocable by the Borrower (except as otherwise
provided in Section 8.01).

Not later than 11:00 A.M. (the time of the Administrative Agent) on
the date of each Syndicated Borrowing denominated in Euros, each Bank
shall make available its respective Commitment Percentage of such
Syndicated Borrowing in Euros in immediately available funds to the
Administrative Agent at its address determined pursuant to Section 9.01. 
Unless the Administrative Agent determines that any applicable condition
specified in Article III has not been satisfied or waived in accordance
with Section 9.06, the Administrative Agent will make the funds so
received from the Banks available to the Borrower in the manner provided for in
the applicable Notice of Borrowing no later than 11:00 A.M. (the time of the
Administrative Agent).

15

NY:791404.13                                                                                                                                                                                         

Not later than 11:00 A.M.
(the time of the Administrative Agent) on the date of each Syndicated
Borrowing denominated in an Alternative Currency, each Bank shall make
available its respective Commitment Percentage of such Syndicated Borrowing, in
the requested Alternative Currency in immediately available funds at the office
of the Administrative Agent.  Unless the Administrative Agent determines that
any applicable condition specified in Article III has not been satisfied
or waived in accordance with Section 9.06, the Administrative Agent
will make the funds so received from the Banks available to the Borrower in the
manner provided for in the applicable Notice of Borrowing no later than
11:00 A.M. (the time of the Administrative Agent).  

Unless the Administrative
Agent receives notice from a Bank, at the address of the Administrative Agent,
no later than 9:00 A.M. (the time of the Administrative Agent) on the date
of a Syndicated Borrowing with respect to a Eurocurrency Loan, stating that
such Bank will not make a Syndicated Loan in connection with such Syndicated
Borrowing, the Administrative Agent shall be entitled to assume that such Bank
will make a Syndicated Loan in connection with such Syndicated Borrowing and,
in reliance on such assumption, the Administrative Agent may (but shall not be
obligated to) make available such Bank's Commitment Percentage of such
Syndicated Borrowing to the Borrower for the account of such Bank.  If the
Administrative Agent makes such Bank's Commitment Percentage of such Syndicated
Borrowing available to the Borrower and such Bank does not in fact make its
Commitment Percentage of such Syndicated Borrowing available on such date, the
Administrative Agent shall be entitled to recover such Bank's Commitment
Percentage from such Bank or the Borrower (and for such purpose shall be
entitled to charge such amount to any account of the Borrower maintained with
the Administrative Agent), together with interest thereon for each day during
the period from the date of such Syndicated Borrowing until such sum shall be
paid in full at EURIBOR; provided that (i) any such payment by the
Borrower of such Bank's Commitment Percentage and interest thereon shall be
without prejudice to any rights that the Borrower may have against such Bank
and (ii) until such Bank has paid its Commitment Percentage of such
Syndicated Borrowing, together with interest pursuant to the foregoing, it will
have no interest in or rights with respect to such Syndicated Borrowing for any
purpose hereunder.  If the Administrative Agent does not exercise its option to
advance funds for the account of such Bank, it shall forthwith notify the
Borrower of such decision.  

In the event that the Notice
of Borrowing fails to specify the Permitted Currency of such Syndicated Loans,
such Syndicated Loans shall be denominated in Euros.  If the Borrower is
otherwise entitled under this Agreement to repay any Syndicated Loans maturing
at the end of an Interest Period applicable thereto with the proceeds of a new
Borrowing, and the Borrower fails to repay such Syndicated Loans using its own
moneys and fails to give a Notice of Borrowing in connection with such new
Syndicated Borrowing, a new Syndicated Borrowing shall be deemed to be made on
the date such Syndicated Loans mature in an amount equal to the principal
amount of the Syndicated Loans so maturing, and the Syndicated Loans comprising
such new Syndicated Borrowing shall be Eurocurrency Loans having an Interest
Period of one month.

Notwithstanding anything to
the contrary contained herein, there shall not be more than ten (10) Interest
Periods outstanding at any given time.

Continuation Elections

.  By delivering a notice (a
"Notice of Continuation"), which shall be substantially in the form of Exhibit D-2
to the Administrative Agent on or before 11:00 A.M. (the time of the
Administrative Agent), on a Business Day, the Borrower may from time to time
irrevocably elect, by notice (a) on the same Business Day, in the case of
Eurocurrency Loans denominated in Sterling or (b) three (3) Business Days, in
the case of Eurocurrency Loans denominated in Euros or an Alternative Currency,
that all, or any portion in an aggregate principal amount of €500,000 or any
larger integral multiple of €250,000 (or, in each case, the Alternative
Currency Amount thereof) be continued as Eurocurrency Loans, which such notice
shall specify the Permitted Currency in which such Eurocurrency Loan is
denominated (in the absence of delivery of a Notice of Continuation with
respect to any Eurocurrency Loan at least 3 Business Days before the last day
of the then current Interest Period with respect thereto, such Eurocurrency
Loan shall, on such last day, automatically convert to a Loan denominated in
Euros having an Interest Period of one month); provided, however,
that each such continuation shall be pro rated among the Banks that have made
such Loans.

[Reserved].

Maturity
of Loans.

16

NY:791404.13                                                                                                                                                                                         

Each Eurocurrency Loan
included in any Borrowing shall mature, and the principal amount thereof shall
be due and payable, on the last day of the Interest Period applicable to such
Borrowing.

Notwithstanding the
foregoing, the outstanding principal amount of the Loans, if any, together with
all accrued but unpaid interest thereon, if any, shall be due and payable on
the Termination Date.

Interest Rates

.  

Each Eurocurrency Loan shall
bear interest on the outstanding principal amount thereof, for the Interest
Period applicable thereto, at a rate per annum equal to the sum of the
Applicable Margin plus EURIBOR plus Mandatory Costs applicable to
such Interest Period.  Such interest shall be payable for each Interest Period
on the last day thereof and, if such Interest Period is longer than 3 months,
at intervals of 3 months after the first day thereof.  Any overdue principal of
and, to the extent permitted by law, overdue interest on any Eurocurrency Loan
shall bear interest, payable on demand, for each day until paid at a rate per
annum equal to the Default Rate.

The Administrative Agent
shall determine the interest rates applicable to the Loans hereunder.  The
Administrative Agent shall give prompt notice to the Borrower and the other
Banks (by telephone, facsimile or other electronic transmission) of each rate
of interest so determined, and its determination thereof shall be conclusive in
the absence of manifest error.

Maximum Rate.  In no contingency or event whatsoever shall the aggregate
of all amounts deemed interest under this Agreement charged or collected
pursuant to the terms of this Agreement exceed the highest rate permissible
under any applicable law which a court of competent jurisdiction shall, in a
final determination, deem applicable hereto.  In the event that such a court
determines that the Banks have charged or received interest hereunder in excess
of the highest applicable rate, the rate in effect hereunder shall
automatically be reduced to the maximum rate permitted by applicable law and
the Banks shall, at the Borrower's option, (i) promptly refund to the Borrower
any interest received by the Banks in excess of the maximum lawful rate or (ii)
apply such excess to the principal balance of the Loans on a pro rata
basis.  It is the intent hereof that the Borrower not pay or contract to pay,
and that neither the Administrative Agent nor any Bank receive or contract to
receive, directly or indirectly in any manner whatsoever, interest in excess of
that which may be paid by the Borrower under applicable law.

Fees

.  

Facility Fee.  The Borrower shall pay to the Administrative Agent,
for the ratable account of each Bank, a facility fee on the aggregate amount of
such Bank's Commitment, at a rate per annum equal to (i) for the period
commencing on the Closing Date to and including the first Performance Pricing
Determination Date, 0.125%; and (ii) from and after the first Performance
Pricing Determination Date, the percentage determined on each Performance
Pricing Determination Date by reference to the table set forth below based on
the criteria and provisions used in determining the Applicable Margin.  

17

NY:791404.13                                                                                                                                                                                         

	
  Level

  	
  Debt Rating

  (S&P/Moody's)

  	
  Facility Fee

  	
  Utilization Fee

  
	
  I

  	
  > A/A2

  	
  0.060%

  	
  0.050%

  
	
  II

  	
  A-/A3

  	
  0.080%

  	
  0.050%

  
	
  III

  	
  BBB+/Baa1

  	
  0.100%

  	
  0.050%

  
	
  IV

  	
  BBB/Baa2

  	
  0.125%

  	
  0.100%

  
	
  V

  	
  BBB-/Baa3

  	
  0.150%

  	
  0.100%

  
	
  VI

  	
  BBB-/Ba1 or BB+/Baa3

  	
  0.200%

  	
  0.125%

  
	
  VII

  	
  < BB+/Ba1

  	
  0.250%

  	
  0.125%

  

Such facility fees shall
accrue from and including the Closing Date to (but excluding) the Termination
Date and shall be payable quarterly in arrears on each December 31, March 31,
June 30, September 30 and on the Termination Date.

Utilization Fee. The Borrower shall pay to the Administrative Agent,
for the account of the Banks, a non-refundable utilization fee at a rate per
annum equal to (i) for the period commencing on the Closing Date to and
including the first Performance Pricing Determination Date, 0.100%; and (ii)
from and after the first Performance Pricing Determination Date, the percentage
determined on each Performance Pricing Determination Date by reference to the
table set forth in clause (a) above based on the Borrower's Debt Rating, on the
aggregate principal amount of outstanding Syndicated Loans and the Ancillary
Outstandings of all Ancillary Facilities when the Average Utilization exceeds
fifty percent (50%) of the aggregate Commitments.  Such utilization fee shall
accrue from and including the Closing Date to (but excluding) the Termination
Date and shall be payable quarterly in arrears on each December 31, March 31,
June 30, September 30 and on the Termination Date. Such utilization fee shall
be distributed by the Administrative Agent to the Banks pro rata
in accordance with the Banks' respective Commitments. 

Optional Termination or Reduction of Commitments

.  The Borrower may, upon at
least five (5) Business Days' notice to the Administrative Agent, terminate at
any time, or proportionately reduce the Unused Commitments from time to time by
an aggregate amount of at least €500,000 or any larger multiple of €250,000. 
Upon a reduction of the Unused Commitments, each Bank's Commitments shall be
permanently and ratably reduced.

Termination of Commitments

.  The Commitments shall
terminate on the Termination Date and any Loans then outstanding (together with
accrued interest thereon) shall be due and payable by the Borrower on such
date.

Optional Prepayments

.  

The Borrower may, upon notice
to the Administrative Agent on the same Business Day, prepay any Eurocurrency
Loan denominated in Euros in whole at any time, or from time to time in part in
amounts aggregating at least €500,000 or any larger multiple of €250,000, by
paying the principal amount to be prepaid together with accrued interest
thereon to the date of prepayment.

Subject to Section 8.04,
the Borrower may, upon at least five (5) Business Days' notice to the
Administrative Agent, prepay any Eurocurrency Loan in whole at any time, or
from time to time in part, prior to the maturity thereof, in amounts
aggregating at least €500,000 or any larger multiple of €250,000 (based on the
Alternative Currency Amount thereof), by paying the principal amount to be
prepaid together with accrued interest thereon to the date of the prepayment.

Any such notice under this
Section shall specify:

the date of such prepayment,
which shall be a Business Day,

the aggregate amount of such
prepayment, and

the Permitted Currency in
which such Eurocurrency Loans are denominated.

18

NY:791404.13                                                                                                                                                                                         

Upon the Administrative
Agent's receipt of a notice of prepayment pursuant to this Section, such notice
shall not thereafter be revocable by the Borrower.  No repayment or prepayment
pursuant to this Section shall affect any of the Borrower's obligations under
any Hedging Agreement.

Mandatory Prepayments

.  

On each date on which the
Commitments are reduced pursuant to Section 2.08 or Section 2.09,
the Borrower shall repay or prepay such principal amount of the outstanding
Loans, if any (together with interest accrued thereon), as may be necessary so
that after such payment the aggregate unpaid principal amount of the Loans does
not exceed the aggregate amount of the Commitments as then reduced.

If, as of the most recent
Revaluation Date, (i) solely as a result of currency fluctuations, the
outstanding principal amount of all Syndicated Loans plus the sum of all
outstanding Letter of Credit Obligations exceeds 105% of the aggregate
Commitments, or (ii) for any other reason, the outstanding principal amount of
all Syndicated Loans plus the sum of all outstanding Letter of Credit
Obligations exceeds the aggregate Commitments, then, in each case, the Borrower
shall repay immediately upon notice from the Administrative Agent, by payment
to the Administrative Agent for the account of the Banks, an amount equal to
such excess with each such repayment applied first to the principal
amount of outstanding Syndicated Loans and second, with respect to any
Letter of Credit Obligations, a payment of cash collateral into a cash
collateral account opened by the Administrative Agent, for the benefit of the
Banks in an amount equal to such excess (such cash collateral to be applied in
accordance with Section 6.01).  Each such repayment pursuant to this Section
2.11 shall be accompanied by any amount required to be paid pursuant to Section
8.04.  No repayment or prepayment pursuant to this Section shall affect any
of the Borrower's obligations under any Hedging Agreement.

General Provisions as to Payments

.

The Borrower shall make each
payment of principal, interest and fees hereunder without defense, setoff or
counterclaim to the Administrative Agent (or the Issuer, as applicable) not
later than 11:00 A.M. (the time of the Administrative Agent) on the date
when due with respect to any Loans or Letters of Credit (including any fee,
commission or other amount with respect thereto) in the Permitted Currency in
which such Loan or Letter of Credit is denominated and in immediately available
funds at its Lending Office.

Whenever any payment of
principal of or interest on, the Eurocurrency Loans shall be due on a day which
is not a Business Day, the date for payment thereof shall be extended to the
next succeeding Business Day unless such Business Day falls in another calendar
month, in which case the date for payment thereof shall be the next preceding
Business Day.

Computation of Interest and Fees

.  Interest on Loans and all
fees payable hereunder shall be paid for the actual number of days elapsed
(including the first day but excluding the last day) and computed on the basis
of (i) if denominated in Sterling a year of 365/366 days, and (ii) if
denominated in Euro or any Alternative Currency a year of 360 days.  

Letters of Credit

.

Generally.  Subject to the terms and conditions of this
Agreement, and in reliance upon the representations and warranties of the
Borrower herein set forth, the Issuer agrees to issue for the account of the
Borrower, one or more Letters of Credit denominated in a Permitted Currency in a minimum original face amount of
€10,000 (or the Alternative Currency Amount thereof, as applicable), in
accordance with this Section 2.14(a), from time to time during the
period commencing on the Closing Date and ending on the Business Day prior to
the Termination Date. 

19

NY:791404.13                                                                                                                                                                                         

The Issuer shall have no
obligation to issue any Letter of Credit at any time:  (A) if the
Administrative Agent has determined that the aggregate maximum amount then
available for drawing under all Letters of Credit, after giving effect to the
issuance of the requested Letter of Credit, would exceed any limit imposed by
law or regulation upon the Issuer; (B) if the Administrative Agent has
determined that, after giving effect to the issuance of the requested Letter of
Credit, the conditions set forth in Article III as to the advancing of
Loans or issuance of Letters of Credit which have not been waived in accordance
with Section 9.06 would not be satisfied; and (C) such Letter of
Credit has an expiration date (1) more than 364 days after the date of issuance
(subject to automatic extension for additional 364
day periods pursuant to the terms of the Letter of Credit Application or other
documentation acceptable to the Issuer, so long as any such extension
does not extend beyond the Termination Date) or (2) after the Termination Date;
provided, however, such Letter of Credit may have an expiration
date after the Termination Date if (A) each of the Administrative Agent and the
Issuer consent in writing prior to the issuance thereof and (B) all Letter of
Credit Obligations associated with any such Letter of Credit are cash
collateralized or otherwise supported in a manner satisfactory to the
Administrative Agent and the Issuer on or prior to the Termination Date.  The
obligation of the Issuer to issue any Letter of Credit is subject to the
satisfaction in full of the following conditions: (A) the Borrower shall have
delivered to the Issuer at such times and in such manner as the Issuer may
prescribe, a Letter of Credit Application as to Letters of Credit and such
other documents and materials as may be required pursuant to the terms thereof
all satisfactory in form and substance to the Issuer and the terms of the
proposed Letter of Credit shall be satisfactory in form and substance to the
Issuer; (B) as of the date of issuance, no order, judgment or decree of any
court, arbitrator or Authority shall purport by its terms to enjoin or restrain
the Issuer from issuing the Letter of Credit and no law, rule or regulation
applicable to the Issuer and no request or directive (whether or not having the
force of law) from any Authority with jurisdiction over the Issuer shall
prohibit or request that the Issuer refrain from the issuance of letters of
credit generally or the issuance of that Letter of Credit; and (C) after the
issuance of the requested Letter of Credit, the conditions set forth in this
Section shall be satisfied. 

At least five (5) Business
Days before the effective date for any Letter of Credit, the Borrower shall
give the Issuer and the Administrative Agent notice by telecopier containing
the signature of an authorized officer or employee of the Borrower.  Such
notice shall be irrevocable and shall specify the original face amount of the
Letter of Credit requested, the Permitted Currency in which such Letter of
Credit shall be denominated (which shall be Euros if such notice does not
specify a Permitted Currency), the effective date (which day shall be a
Business Day) of issuance of such requested Letter of Credit, the date on which
such requested Letter of Credit is to expire, the amount of then outstanding
aggregate Letter of Credit Obligations, the purpose for which such Letter of
Credit is to be issued, whether such Letter of Credit may be drawn in single or
partial draws, and the person for whose benefit the requested Letter of Credit
is to be issued.

If the conditions set forth
in subsections (i) and (ii) above are satisfied, the Issuer shall issue the
requested Letter of Credit.  The Administrative Agent shall give each Bank
written or electronic notice, or telephonic notice confirmed promptly
thereafter in writing, of the issuance of a Letter of Credit and upon request
by any Bank, shall deliver to such Bank in connection with such notice a copy
of the Letter of Credit issued by the Issuer.  

The Borrower shall pay to the
Issuer, for its own account, (i) a fronting fee in respect of each Letter of
Credit requested by it of 0.10%; and (ii) the standard charges and fees
assessed by the Issuer in connection with the administration, amendment and
payment or cancellation of Letters of Credit issued hereunder, which charges
and fees shall be those typically charged by the Issuer to its customers
generally having credit and other characteristics similar to the Borrower, as
determined in good faith by the Issuer.  Where a Letter of Credit requested is
less than €25,000, the fronting fee in each case will be calculated on the
basis of a minimum €25,000 Letter of Credit.

Letter of Credit Payments;
Duties of the Administrative Agent.

Subject to the terms and
conditions contained in this Agreement, with respect to the Letters of Credit,
the Borrower shall pay to the order of the Administrative Agent the amount of
the Letter of Credit Fee payable with respect to each Letter of Credit (and the
Administrative Agent shall pay to each other Bank such Bank's respective
Commitment Percentage thereof) (A) in arrears on the last day of each
Fiscal Quarter, (B) on the Termination Date and (C) if there are any Letter of
Credit Obligations on the Termination Date, in arrears on the last day of each
Fiscal Quarter and on the date on which there are no Letter of Credit
Obligations, in each case for the previous period.

20

NY:791404.13                                                                                                                                                                                         

Upon receipt by the Issuer
from the beneficiary of a Letter of Credit of any demand for payment under such
Letter of Credit, the Issuer shall promptly notify the Borrower and the
Administrative Agent of the amount to be paid by the Issuer as a result of such
demand and the date on which payment is to be made by the Issuer to the
beneficiary in respect of such demand.  The Borrower shall reimburse the Issuer
in the applicable Permitted Currency for drawings under a Letter of Credit no
later than the earlier of (A) the time specified in the Letter of Credit
Application, or (B) 1 Business Day after the payment by the Issuer.  Upon its
receipt of a notice referred to in the first sentence of this subsection (ii),
the Borrower shall advise the Administrative Agent whether or not the Borrower
intends to borrow hereunder to finance its obligation to reimburse the Issuer
for the amount of the related demand for payment and, if it does, the Borrower
shall submit a timely request for such borrowing as provided in the applicable
provisions of this Agreement.  If the Borrower fails to so advise the
Administrative Agent, or if the Borrower fails to reimburse the Issuer for a
demand for payment under a Letter of Credit by the date required to do so, then
(i) if the applicable conditions contained in Article III would permit
the making of Syndicated Loans, the Borrower shall be deemed to have requested
a borrowing of Syndicated Loans in a Euro Amount equal to the unpaid
Reimbursement Obligation and the Administrative Agent shall give each Bank
notice of the amount of the Syndicated Loan to be made available in accordance
with Section 2.02(c), and (ii) if such conditions would not permit the
making of Loans, the provisions of subsection (d) of this Section shall apply. 
The minimum borrowing limitations set forth in Section 2.01(a) shall not
apply to any borrowing of Syndicated Loans under this subsection.

Any Reimbursement Obligation
with respect to any Letter of Credit shall bear interest from the date of the
relevant drawing under the pertinent Letter of Credit until the date of payment
in full thereof at a rate per annum equal to (A) prior to the date that is 3
Business Days after the date of the related payment by the Issuer, EURIBOR plus
the Applicable Margin and (B) thereafter, the Default Rate.

Any action taken or omitted
to be taken by the Issuer in connection with any Letter of Credit, if taken or
omitted in the absence of willful misconduct or gross negligence, shall not put
the Issuer under any resulting liability to any Bank, or assuming that the
Issuer has complied with the procedures specified in subsection (ii), relieve
that Bank of its obligations hereunder to the Issuer.  In determining whether
to pay under any Letter of Credit, the Issuer shall have no obligation relative
to the Banks other than to confirm that any documents required to have been
delivered under such Letter of Credit appear to comply on their face, with the
requirements of such Letter of Credit.

After the occurrence and
during the continuation of an Event of Default, or upon the termination of this
Agreement, to the extent of any Letter of Credit Obligations, the
Administrative Agent, on behalf of the Issuer, may, as separate collateral
security to be held by the Administrative Agent, on behalf of the Issuer and
Banks, for reimbursement of amounts of the Letter of Credit Obligations which
are subsequently funded by the Issuer (and for which the other Banks have
purchased a participation therein as set forth below), either (x) immediately
advance the principal amount thereof as Loans, and set aside the amounts so
advanced as such collateral security, or (y) demand from the Borrower cash
collateral in an amount equal to 100% of such Letter of Credit Obligations with
respect to each Letter of Credit (which such cash collateral shall be deposited
in the applicable Permitted Currency in which each Letter of Credit is
denominated) as such collateral security (such cash collateral to be applied in
accordance with Section 6.01). The Borrower hereby agrees that the
Administrative Agent, for the benefit of itself and the other Banks, shall have
a right of setoff against any security interest in such collateral reserve. 
After a Letter of Credit has been canceled and all Letter of Credit Obligations
with respect to such Letter of Credit have been satisfied, and the Issuer (or
participant) has been reimbursed all amounts funded by the Issuer (or participant)
with respect thereto, any balance remaining in said collateral reserve with
respect to such Letter of Credit may be applied to other unpaid obligations of
the Borrower hereunder, and, if none, shall be remitted to the Borrower.

Purchase of Participations.  Each Bank hereby irrevocably and unconditionally
purchases and receives from the Issuer, without recourse or warranty, an
undivided interest and participation, equal to the amount of such Bank's
Commitment Percentage, in each Letter of Credit issued by the Issuer.  

21

NY:791404.13                                                                                                                                                                                         

Sharing of Letters of
Credit Payments.  In the event that
the Issuer makes any payment under a Letter of Credit for which the Borrower
shall not have repaid such amount to the Issuer pursuant to this Section, the
Issuer shall promptly notify the other Banks of such failure, and each other
Bank shall promptly and unconditionally pay to the Issuer its Commitment
Percentage of the amount of such payment in the applicable Permitted Currency
and in same day funds.  If the Issuer so notifies the other Banks prior to
10:00 A.M. (the time of the Administrative Agent) on any Business Day, such
other Banks shall make available to the Issuer their respective Commitment
Percentages of the amount of such payment on such Business Day in same day funds. 
If and to the extent any of such other Banks shall not have so made its
Commitment Percentage of the amount of such payment available to the Issuer,
each such other Bank agrees to pay to the Issuer forthwith on demand such
amount together with interest thereon, for each day from the date such payment
was first due until the date such amount is paid to the Issuer at EURIBOR plus
the Applicable Margin.

Sharing of Reimbursement
Obligation Payments. Whenever the
Issuer receives a payment from the Borrower or any guarantor on account of
Letter of Credit Obligations owing in respect of a Letter of Credit, including
any interest thereon, as to which the Issuer has received any payments from the
other Banks pursuant to this Section, the Issuer shall promptly pay to each
other Bank, in the Permitted Currency and in the kind of funds so received, an
amount equal to such other Bank's Commitment Percentage thereof; provided
that in the event that any such payment received by the Issuer shall be
required to be returned by the Issuer, each such other Bank shall return to the
Issuer the portion thereof previously distributed by the Issuer to it.  Each
such payment shall be made by the Issuer on the Business Day on which the funds
are paid to such Person, if received prior to 10:00 a.m. (the time of the
Administrative Agent) on such Business Day, and otherwise on the next
succeeding Business Day. Each Bank agrees that letter of credit fees (other
than the Letter of Credit Fee) payable under a Letter of Credit Application are
solely for the account of the Issuer, notwithstanding any provision contained
herein to the contrary.

Obligations Irrevocable.  The obligations of the Borrower to reimburse the
Issuer for drawings under a Letter of Credit and the obligations of each Bank
to make payments to the Issuer with respect to a Letter of Credit, shall be
irrevocable, not subject to any qualification or exception whatsoever and shall
be made in accordance with, but not subject to, the terms and conditions of
this Agreement under all circumstances, including, without limitation, any of
the following circumstances, to the extent such circumstances do not result
from the Issuer's gross negligence or willful misconduct:

any lack of validity or
enforceability of this Agreement or any of the other Loan Documents;

the existence of any claim,
set-off, defense or other right which the Borrower may have at any time against
a beneficiary named in the Letters of Credit or any transferee of the Letters
of Credit (or any Person for whom any such transferee may be acting), the
Issuer, any Bank or any other Person, whether in connection with this
Agreement, any Letter of Credit, the transactions contemplated herein or any
unrelated transactions;

any draft, certificate or any
other document presented under a Letter of Credit proves to be forged,
fraudulent, invalid or insufficient in any respect or any statement therein is
untrue or inaccurate in any respect;

the surrender or impairment
of any security for the performance or observance of any of the terms of any of
the Loan Documents;

payment by the Issuer under a
Letter of Credit proves to be forged, fraudulent, invalid or insufficient in
any respect or any statement therein is untrue or inaccurate in any respect;

payment by the Issuer under a
Letter of Credit against presentation of any draft or certificate that does not
comply with the terms of such Letter of Credit, except payment resulting from
the gross negligence or willful misconduct of the Issuer; or

any other circumstances or
happenings whatsoever, whether or not similar to any of the foregoing. 

Amendments to Letters of
Credit.  The Issuer shall not agree
to an amendment or modification to any Letter of Credit unless the Required
Banks have granted their prior written consent thereto, which consent shall not
be unreasonably withheld or delayed; provided, however, the
Issuer may amend or otherwise modify such Letter of Credit without the need to
obtain consent of the Required Banks if the respective Letter of Credit
affected thereby could have been issued under this Agreement in such amended or
modified form, but if the undrawn available amount under such Letter of Credit
is increased thereby, only so long as a notice is sent by the Borrower under Section
3.02(a).  In the case of any conflict between provisions of any Letter of
Credit Application or this Agreement, the provisions of this Agreement shall
govern, but only for so long as this Agreement is in effect.

22

NY:791404.13                                                                                                                                                                                         

Availability of Ancillary
Facilities

.

(a)           A Bank may
provide an Ancillary Facility on a bilateral basis to the Borrower as part of
the Commitments.  The aggregate amount available of all Ancillary Facilities
shall not exceed €50 million.

(b)           An Ancillary
Facility may not be made available unless the Administrative Agent has received
from the Borrower not less than seven (7) Business Days before the proposed
start date for that Ancillary Facility:

(i)            a notice in
writing requesting the establishment of an Ancillary Facility by the conversion
of any Unused Commitments into an Ancillary Commitment and specifying:

(A)          the start date
and expiry date of the Ancillary Facility;

(B)           the type of
Ancillary Facility being provided; and

(C)           the identity of
the Ancillary Bank; 

(ii)           a copy of any
relevant Ancillary Facility Documents; and

(iii)          any other
information which the Administrative Agent may reasonably require in connection
with the Ancillary Facility.

(c)           Once the
foregoing conditions have been satisfied:

(i)            the Bank
concerned will become an Ancillary Bank; and

(ii)           the Ancillary
Facility will be available,

with effect from the date
agreed by the Borrower and the Ancillary Bank.

(d)           The
Administrative Agent must promptly notify the other Banks of the matters
referred to in paragraph (b) above.

(e)           The Borrower
and each Ancillary Bank shall, promptly upon reasonable request by the
Administrative Agent, supply the Administrative Agent with any information
relating to the operation of an Ancillary Facility (including the Ancillary
Outstandings) as the Administrative Agent may reasonably request from time to
time. The Borrower consents to all such information being released to the
Administrative Agent and the Ancillary Banks.

(f)            No amendment
or waiver of a term of an Ancillary Facility shall require the consent of any
Bank other than the relevant Ancillary Bank unless such amendment or waiver
itself relates to or gives rise to a matter which would require an amendment or
waiver of or under this Agreement (including, for the avoidance of doubt, under
this Section 2.04) in which case the provisions of this Agreement with
regard to amendments and waivers will apply.

Terms
of Ancillary Facilities

.

 (a)          Except as
provided below, the terms of any Ancillary Facility will be those agreed by the
Ancillary Bank and the Borrower.

(b)           However, those
terms:

(i)            must be based
upon normal commercial terms at that time;

(ii)           must only
allow the Borrower to use the Ancillary Facility;

23

NY:791404.13                                                                                                                                                                                         

(iii)          must not allow
the Ancillary Outstandings to exceed the Ancillary Commitment (and if Ancillary
Outstandings are calculated on a net basis must not allow the aggregate gross
outstandings under the Ancillary Facility to exceed the amount agreed with the
Administrative Agent);

(iv)          must provide
that the Ancillary Commitment of the Bank is equal to or less than the lesser
of (i) €50,000,000 and (ii) that Bank's Commitment Percentage of the Unused
Commitments at that time (before reduction on account of the Ancillary
Commitment); and

(v)           must ensure
that the Ancillary Commitment is cancelled not later than the Termination Date.

(c)           In the event of
any conflict between the terms of an Ancillary Facility Document and any other
Loan Document, the terms of the other Loan Document will prevail.

Commitment
of an Ancillary Bank

.

The available Commitment at
any time of an Ancillary Bank shall be:

(a)           reduced by the
amount of any Ancillary Commitment of such Ancillary Bank in force at that
time; and

(b)           increased by
the amount of any such Ancillary Commitment cancelled from time to time.

Repayment
of Ancillary Facility

.

(a)           No Ancillary
Bank may cancel any of its Ancillary Commitment or demand repayment or
prepayment of any amounts or demand cash cover for any liabilities made
available or incurred by it under its Ancillary Facility (except where the
Ancillary Facility is provided on a net limit basis to the extent required to
bring any gross outstandings down to the net limit), unless:

(i)            the
Commitments have been cancelled in full, or the Administrative Agent has
declared all outstanding Loans immediately due and payable; or

(ii)           the Ancillary
Outstandings (if any) under that Ancillary Facility can be repaid by a Loan and
the Ancillary Bank gives sufficient notice to enable a Loan to be made to repay
those Ancillary Outstandings.

(b)           For the
purposes of determining whether or not the Ancillary Outstandings under that
Ancillary Facility can be repaid by a Loan:

(i)            the available Commitments
will be deemed increased by the amount of the relevant Ancillary Commitment;
and

(ii)           the Loan may
(provided that subparagraph (i) of paragraph (a) above does not apply) be made
irrespective of whether any Representations under Section 4 of this
Agreement are incorrect or any other Default is outstanding or any other
applicable condition precedent is not satisfied (but only to the extent that
the proceeds are applied in repaying those Ancillary Outstandings).

(c)           On the making
of a Loan to repay the Ancillary Outstandings:

(i)            each Bank will
participate in that Loan in such amount, and the overall participations in all
Loans then outstanding shall be adjusted (in each case as determined by the
Administrative Agent), as will result as nearly as possible in the aggregate
amount of each Bank's Commitment bearing the same proportion to the aggregate
amount of the Loans then outstanding as its Commitment bears to the aggregate
of the Commitments of all Banks; and

(ii)           the relevant
Ancillary Facility shall be cancelled.

24

NY:791404.13                                                                                                                                                                                         

CONDITIONS TO BORROWINGS
AND ISSUANCE OF NEW LETTERS OF CREDIT

Conditions to Closing

.  The obligations of each
Bank under this Agreement are subject to the satisfaction of the conditions set
forth in Section 3.02 and each of the following conditions:

Closing Documents.  Receipt by the Administrative Agent of the
following (in sufficient number of counterparts for delivery of a counterpart
to each Bank and retention of one counterpart by the Administrative Agent):

from each of the parties
hereto a duly executed counterpart of this Agreement;

an opinion of Alston &
Bird LLP, counsel for the Borrower, dated as of the Closing Date, substantially
in the form of Exhibit B;

(A) the Guarantor's most
recent audited consolidated financial statements, including, without
limitation, a balance sheet and income statement and its most recent 10-K filed
with the U.S. Securities and Exchange Commission and; (B) any publicly-available
consolidated balance sheet of the Borrower;

a certificate from the
Guarantor, dated as of the Closing Date, signed by a Responsible Officer of the
Guarantor (i) certifying that no Default has occurred and is continuing on the
Closing Date; (ii) certifying that the representations and warranties of the
Borrower contained in Article IV are true in all material respects
on and as of the Closing Date; (iii) authorizing a specified person or persons
to execute this Agreement on its behalf with a specimen signature of the
specified person or persons; and (iv) authorizing a specified person or
persons, on its behalf, to sign and/or dispatch all other documents and notices
(including, in relation to an Additional Borrower, any Notice of Borrowing or
Notice of Continuation) to be signed and/or dispatched by it under or in
connection with the Loan Documents;

all documents which the
Administrative Agent or any Bank may reasonably request relating to the
existence of the Borrower and the Guarantor, the corporate authority for and
the validity of the Loan Documents to which the Borrower or the Guarantor is a
party, and any other matters relevant thereto, all in form and substance
satisfactory to the Administrative Agent, including, without limitation, a certificate
of incumbency of the Borrower and the Guarantor, signed by the respective
Secretary or an Assistant Secretary of the Borrower and the Guarantor,
certifying as to the names, true signatures and incumbency of the officer or
officers of the Borrower and the Guarantor, authorized to execute and deliver
the Loan Documents, and certified copies of the following items as to the
Borrower and the Guarantor:  (i) its Certificate of Incorporation, or
comparable organizational document, (ii) its Bylaws, (iii) a
certificate by the appropriate governmental authority as to its good standing
as a legal entity formed under the laws of the jurisdiction of formation, and
(iv) the action taken by its respective Board of Directors (or a duly
authorized committee thereof) authorizing its execution, delivery and
performance of the Loan Documents to which it is a party; 

a Notice of Borrowing, if
necessary;

opinions of Allen & Overy
LLP and Allen & Overy Luxembourg, counsel for the Administrative Agent as
Agent for the Banks, dated as of the Closing Date, substantially in the form of
Exhibit A;

No Injunction, Etc.  No action, suit, investigation or proceeding shall
be pending or threatened in writing before any court, arbitrator or
governmental authority that could reasonably be expected to materially and
adversely affect any transaction contemplated hereby (including, without
limitation, the Unilin Acquisition); and

Closing of the Mohawk
Credit Agreement.  The Mohawk Credit
Agreement shall be closed prior to or contemporaneously with this Agreement on
the terms and conditions set forth therein.

25

NY:791404.13                                                                                                                                                                                         

Conditions to All Borrowings
and Issuance of Letters of Credit

.  The obligation of each
Bank to make a Loan on the occasion of each Borrowing or the Issuer to issue a
Letter of Credit is subject to the satisfaction of the following conditions:

in the case of a Loan,
receipt by the Administrative Agent of a Notice of Borrowing, or in the case of
a Letter of Credit (or increase to the undrawn amount available under a Letter
of Credit), receipt by the Administrative Agent and the Issuer of a request for
such Letter of Credit (or request as to such increase);

no Default or Event of
Default shall have occurred and be continuing immediately after giving effect
to such Borrowing or issuance of such Letter of Credit;

all representations and
warranties contained in Article IV of this Agreement (other than
those contained in Sections 4.04(b) and 4.05), shall be true
on and as of the date of such Borrowing or issuance of such Letter of Credit
except for changes permitted by this Agreement and except to the extent they
relate solely to an earlier date; provided, that with respect to those
contained in Sections 4.01 and 4.07, the determination of
whether any Material Adverse Effect has occurred as set forth therein shall be
made solely by the Guarantor, in its reasonable, good faith judgment ; and

immediately after such
Borrowing or issuance of such Letter of Credit, the sum of (x) the aggregate
outstanding principal amount of the Loans plus the Letter of Credit
Obligations of the Banks will not exceed (y) the amount of the aggregate available
Commitments.

Each Borrowing and issuance
of a Letter of Credit hereunder shall be deemed to be a representation and
warranty by the Borrower on the date thereof as to the facts specified in
paragraphs (b), (c) and (d) of this Section.

REPRESENTATIONS AND
WARRANTIES

Each of the Borrower and
Guarantor, as applicable, represent and warrant that:

Corporate Existence and Power

.  Each of the Borrower and
the Guarantor is duly organized, validly existing and in good standing under
the laws of the jurisdiction of its formation, is duly qualified to transact
business in every jurisdiction where, by the nature of its business, such
qualification is necessary and where failure to be so qualified could have or
create a reasonable possibility of causing a Material Adverse Effect, and has
all corporate powers and all material governmental licenses, authorizations,
consents and approvals required to carry on its business as now conducted.

Corporate and Governmental Authorization; No
Contravention

.  The execution, delivery
and performance by each of the Borrower and the Guarantor of this Agreement and
the other Loan Documents to which it is a party (i) are within its corporate powers,
(ii) have been duly authorized by all necessary corporate action, (iii) require
no action by or in respect of or filing with, any governmental body, agency or
official (other than routine filings with the Securities and Exchange
Commission), (iv) do not contravene, or constitute a default under, any
provision of applicable law or regulation or of any organizational document of
the Borrower or the Guarantor or of any agreement, judgment, injunction, order,
decree or other instrument binding upon the Guarantor or any of its
Subsidiaries, and (v) do not result in the creation or imposition of any Lien
on any asset of the Guarantor or any of its Subsidiaries.

Binding Effect

.  This Agreement constitutes
a valid and binding agreement of each of the Borrower and the Guarantor
enforceable in accordance with its terms, and the other Loan Documents, when
executed and delivered in accordance with this Agreement, will constitute valid
and binding obligations of the Borrower (provided that the Borrower is a party
to any such Loan Document) enforceable in accordance with their respective
terms, provided that the enforceability hereof and thereof is subject in
each case to general principles of equity and to bankruptcy, insolvency and
similar laws affecting the enforcement of creditors' rights generally.

26

NY:791404.13                                                                                                                                                                                         

Financial Information

(a)           The
consolidated balance sheet of the Guarantor and its Consolidated Subsidiaries
as of December 31, 2004, and the related consolidated statements of
income, shareholders' equity and cash flows for the Fiscal Year then ended,
reported on by KPMG LLP, copies of which have been delivered to each of the
Banks, and the unaudited consolidated financial statements of the Guarantor and
its Consolidated Subsidiaries, each for the interim period ended July 2, 2005,
copies of which have been delivered to each of the Banks, fairly present in all
material respects, in conformity with GAAP, the consolidated financial position
of the Guarantor and its Consolidated Subsidiaries as of such dates and their
consolidated results of operations and cash flows for such periods stated.  

(b)           Since
December 31, 2004, there has been no event, act, condition or occurrence
having, or which could reasonably be expected to have a Material Adverse
Effect.

No Litigation

.  Except as set forth on Schedule
4.05, as of the date hereof, there is no action, suit or proceeding
pending, or to the knowledge of the Guarantor threatened in writing, against or
affecting the Guarantor or any of its Subsidiaries before any court or arbitrator
or any governmental body, agency or official which could reasonably be expected
to have a Material Adverse Effect.

Compliance
with ERISA

(a)           The Guarantor
and each member of the Controlled Group have fulfilled their obligations under
the minimum funding standards of ERISA and the Code with respect to each Plan
and are in compliance with the presently applicable provisions of ERISA and the
Code (except where such noncompliance could not reasonably be expected to have
a Material Adverse Effect), and have not incurred any liability to the PBGC
under Title IV of ERISA.

(b)           Neither the
Guarantor nor any member of the Controlled Group is or ever has been obligated
to contribute to any Multiemployer Plan. 

Taxes

.  There have been filed on
behalf of the Guarantor and its Subsidiaries all Federal, state and local
income, excise, property and other tax returns which are required to be filed
by them and all taxes due pursuant to such returns or pursuant to any
assessment received by or on behalf of the Guarantor or any Subsidiary have
been paid or valid and effective extensions therefor have been obtained. The
charges, accruals and reserves on the books of the Guarantor and its
Subsidiaries in respect of taxes or other governmental charges are, in the
opinion of the Guarantor adequate.  Income tax returns of the Guarantor and its
Subsidiaries have been examined and closed through the Fiscal Year ended 1994.

Subsidiaries

.  Each of the Guarantor's
Subsidiaries is duly organized or formed, validly existing and in good standing
under the laws of the jurisdiction of its creation and organization, and has
all powers (by virtue of its creation and organization) and all material
governmental licenses, authorizations, consents and approvals required to carry
on its business as now conducted. As of the date hereof, the Guarantor has no
Subsidiaries except for those Subsidiaries listed on Schedule 4.08, which
accurately sets forth each such Subsidiary's complete name and jurisdiction of
creation and organization.

Not an Investment Company

.  The Guarantor is not an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.

Ownership of Property, Liens

27

NY:791404.13                                                                                                                                                                                         

.  Each of the Guarantor and
its Consolidated Subsidiaries has title to its properties sufficient for the
conduct of its business, and no such property is subject to any Lien except as
permitted in Section 5.06.

No Default

.  Neither the Guarantor nor
any of its Consolidated Subsidiaries is in default under or with respect to any
agreement, instrument or undertaking to which it is a party or by which it or
any of its property is bound which could reasonably be expected to have or
cause a Material Adverse Effect.  No Default or Event of Default has occurred
and is continuing.

Full Disclosure

.  All information heretofore
furnished by the Borrower or the Guarantor to any Bank for purposes of or in
connection with this Agreement or any transaction contemplated hereby is, and
all such information hereafter furnished by the Borrower or the Guarantor to
any Bank will be, true, accurate and complete in every material respect or
based on reasonable estimates on the date as of which such information is
stated or certified.  The Borrower and the Guarantor have disclosed to the
Banks in writing any and all facts which would have or create a reasonable
possibility of causing a Material Adverse Effect.

Environmental
Matters.

(a)           To
the best knowledge of the Guarantor, after due inquiry (which does not
necessarily mean the performance of a phase I environmental audit), (i) neither
the Guarantor nor any Subsidiary is subject to any Environmental Liability and
(ii) neither the Guarantor nor any Subsidiary has been designated as a
potentially responsible party under CERCLA or under any statute in any other
jurisdiction similar to CERCLA in respect of any matters that could reasonably
be expected to have a Material Adverse Effect. To the best knowledge of the
Guarantor, after due inquiry (which does not necessarily mean the performance
of a phase I environmental audit), none of the Properties has been identified
on any current or proposed (i) National Priorities List under 40 C.F.R. Section
300, (ii) CERCLIS list or (iii) any list arising from a statute in any other
juridiction similar to CERCLA, in each case, in respect of any matters that
could reasonably be expected to have a Material Adverse Effect.

(b)           To the best
knowledge of the Guarantor, after due inquiry (which does not necessarily mean
the performance of a phase I environmental audit), no Hazardous Materials have
been or are being used, produced, manufactured, processed, treated, recycled,
generated, stored, disposed of, managed or otherwise handled at, or shipped or
transported to or from the Properties or are otherwise present at, on, in or
under the Properties, or, to the best of the knowledge of the Guarantor, at or
from any adjacent site or facility, except for (i) Hazardous Materials, such as
cleaning solvents, combustion enhancers, pesticides and other materials used,
produced, manufactured, processed, treated, recycled, generated, stored,
disposed of, managed, or otherwise handled in the ordinary course of business
in compliance with all applicable Environmental Requirements, and (ii)
Hazardous Materials with respect to which the presence thereof, any required remediation
with respect thereto, or the expenses, fines, penalties and other costs
relating thereto could not reasonably be expected to have a Material Adverse
Effect.

(c)           Except for
non-compliance which could not reasonably be expected to have a Material Adverse
Effect, the Guarantor, and each of its Subsidiaries is in compliance with all
Environmental Requirements in connection with the operation of the Properties
and each of the Guarantor's and its Subsidiary's respective businesses.

Capital
Stock

.  All Capital Stock,
debentures, bonds, notes and all other securities of the Guarantor and its
Subsidiaries presently issued and outstanding are validly and properly issued
in accordance with all applicable laws, including but not limited to, the "Blue
Sky" laws of all applicable states and the federal securities laws. At least a
majority of the issued shares of capital stock of each of the Guarantor's
Subsidiaries, if any, (other than Wholly Owned Subsidiaries) is owned by the
Guarantor free and clear of any Lien (other than those Liens permitted by
Section 5.07) or adverse claim.

28

NY:791404.13                                                                                                                                                                                         

Margin Stock

.  Neither the Guarantor nor
any of its Subsidiaries, is engaged principally, or as one of its important
activities, in the business of purchasing or carrying any Margin Stock, and no
part of the proceeds of any Loan will be used (a) to purchase or carry any
Margin Stock or (b) to extend credit to others for the purpose of
purchasing or carrying any Margin Stock.

Insolvency

.  After giving effect to the
execution and delivery of the Loan Documents and the making of the Loans under
this Agreement, neither the Borrower nor the Guarantor will be "insolvent", as
defined in Section 101 of Title 11 of the United States Code, as amended from
time to time, or be unable to pay its debts generally as such debts become due,
or have an unreasonably small capital to engage in any business or transaction,
whether current or contemplated.

Anti-Terrorism
Laws.

In this Section:

"Anti-Terrorism Law" means each of:

Executive Order No. 13224 on Terrorist
Financing: Blocking Property and Prohibiting Transactions With Persons Who
Commit, Threaten To Commit, or Support Terrorism issued September 23, 2001, as
amended by Order 13268 (as so amended, the "Executive Order");

The USA Patriot Act;

the Money Laundering Control
Act of 1986, 18 U.S.C. sect. 1956; and

any similar law enacted in
the United States of America subsequent to the date of this Agreement.

"Restricted Party" means any person listed:

in the Annex to the Executive
Order; 

on the "Specially
Designated Nationals and Blocked Persons" list maintained by the Office of
Foreign Assets Control of the United States Department of the Treasury; or

in any successor list to
either of the foregoing.

To the best of the
Guarantor's knowledge, neither it nor any of its Affiliates:

is, or is controlled by, a
Restricted Party; 

has received funds or other
property from a Restricted Party; or

is in breach of or is the
subject of any action or investigation under any Anti-Terrorism Law.

To the best of the Guarantor's
knowledge, the Guarantor and each of its Affiliates have taken reasonable
measures to ensure compliance with the Anti-Terrorism Laws.

Pari
Passu Ranking.

29

NY:791404.13                                                                                                                                                                                         

The Borrower's payment
obligations under the Loan Documents rank at least pari passu with all its
other present and future unsubordinated, unsecured payment obligations, except
for obligations mandatorily preferred by law applying to companies generally in
its jurisdiction of incorporation or any other jurisdiction where it carries on
business.

COVENANTS

The Borrower and the
Guarantor agree that, so long as any Commitment shall remain in effect, any
Letter of Credit Obligations are outstanding or any amount payable hereunder
remains unpaid: 

Information

.  The Guarantor will deliver to the Administrative Agent for distribution to each
of the Banks: 

as
soon as available and in any event within 90 days after the end of each Fiscal
Year, a consolidated balance sheet of the Guarantor
and its
Consolidated Subsidiaries as of the end of such Fiscal Year and the related
consolidated statements of earnings, stockholders' equity and cash flows for
such Fiscal Year, setting forth in each case in comparative form the figures
for the previous Fiscal Year, including the related unqualified audit opinion
issued by KPMG LLP or other independent public accountants of nationally
recognized standing, with such certification to be free of exceptions and
qualifications not acceptable to the Required Banks; provided that, to the
extent that the Guarantor's annual report to the SEC on
Form 10-K (or any successor form) contains all of the information required by
this Section 5.01(a), the Guarantor
may satisfy the
requirements of this Section 5.01(a) by delivering to the Administrative
Agent an electronic copy of such Form 10-K (or any successor form) with respect
to any Fiscal Year, within the period specified above; 

as
soon as available and in any event within 45 days after the end of each Fiscal
Quarter (other than the fourth Fiscal Quarter), a consolidated balance sheet of
the Guarantor and its Consolidated Subsidiaries as of
the end of such Fiscal Quarter and the related consolidated statements of
earnings and statements of cash flows for such quarter and for the portion of
the Fiscal Year ended at the end of such quarter, setting forth in each case in
comparative form the figures for the corresponding quarter and the
corresponding portion of the previous Fiscal Year, all certified (subject to
normal year-end adjustments) as to fairness of presentation, GAAP (except for the
failure to provide footnotes thereto) and consistency by a Responsible Officer
of the Guarantor; provided that, to the extent that the Guarantor's quarterly report to the SEC on Form 10-Q (or any
successor form) contains all of the information required by this Section
5.01(b), the Guarantor may satisfy the requirements of
this Section 5.01(b) by delivering to the Administrative Agent an
electronic copy of such Form 10-Q (or any successor form) with respect to any
Fiscal Quarter, within the period specified above; 

simultaneously
with the delivery of each set of financial statements referred to in paragraphs
(a) and (b) above, a certificate, substantially in the form of Exhibit E
(a "Compliance Certificate"), of the chief financial officer, treasurer
or the corporate controller of the Guarantor
(i) setting forth
in reasonable detail the calculations required to establish whether the Guarantor was in compliance with the requirements of Sections 5.03,
5.05, and 5.06, on the date of such financial statements and (ii)
stating whether any Default exists on the date of such certificate and, if any
Default then exists, setting forth the details thereof and the action which the
Guarantor is taking or proposes to take with respect
thereto; 

simultaneously
with the delivery of each set of annual financial statements referred to in
paragraph (a) above, operations and cash flow projections (indicating projected
earnings and significant cash sources and uses) prepared by the Guarantor for the Fiscal Year following the Fiscal Year reported on
in such statements referred to in paragraph (a), in such form and detail as is
reasonably acceptable to the Administrative Agent; 

within
1 Business Day after the Guarantor becomes aware of any change in
the Debt Rating, whether such change is made by (i) Moody's, (ii) S&P or
(iii) both Moody's and S&P, evidence in form reasonably satisfactory to the
Administrative Agent of such changed Debt Rating;

30

NY:791404.13                                                                                                                                                                                         

within 1 Business
Day after the Guarantor becomes aware of the occurrence of any
Default, written notice to the Administrative Agent of the occurrence of a
Default (which written notice shall set forth the
details thereof), followed, within 10 Business Days after the date of such
written notice, with a certificate of the chief financial officer or the
treasurer of the Guarantor setting forth the details
thereof and the action which the Guarantor
is taking or
proposes to take with respect thereto;

promptly upon the
mailing thereof to the shareholders of the Guarantor
generally, copies of all financial
statements, reports and proxy statements so mailed; 

promptly upon the
filing thereof, copies of all registration statements (other than the exhibits
thereto and any registration statements on Form S-8 or its equivalent) and
annual, quarterly or monthly reports which the Guarantor shall have filed with the Securities and Exchange
Commission;

if and when any
member of the Controlled Group (i) gives or is required to give notice to the
PBGC of any "reportable event" (as defined in Section 4043 of ERISA) with respect to any Plan which might constitute grounds for a
termination of such Plan under Title IV of ERISA, or knows that the plan
administrator of any Plan has given or is required to give notice of any such
reportable event, a copy of the notice of such reportable event given or
required to be given to the PBGC; (ii) receives notice of complete or partial
withdrawal liability under Title IV of ERISA, a copy of such notice; or (iii)
receives notice from the PBGC under Title IV of ERISA of an intent to terminate
or appoint a trustee to administer any Plan, a copy of such notice; and 

from
time to time such additional information regarding the financial position or
business of the Guarantor and its Subsidiaries as any
Bank may reasonably request, including, without limitation, consolidating
balance sheets and statements of earnings of the Guarantor and
the Guarantor's Subsidiaries, in existence at such time,
as at the end of any fiscal period.

Inspection
of Property, Books and Records

.  The Guarantor will
(a) keep, and cause each Subsidiary to keep, proper books of record and
account in which full, true and correct entries in conformity with GAAP shall
be made of all dealings and transactions in relation to its business and
activities; and (b) permit, and cause each Subsidiary to permit,
representatives of any Bank at such Bank's expense prior to the occurrence of a
Default and at the Borrower or Guarantor's expense, respectively, after the
occurrence of a Default to visit and inspect any of their respective
properties, to examine and make abstracts from any of their respective books
and records and to discuss their respective affairs, finances and accounts with
their respective officers and independent public accountants.  The Borrower and
Guarantor agree to cooperate and assist in such visits and inspections, in each
case upon reasonable notice, at such reasonable times and as often as may
reasonably be desired.

Debt to Capitalization Ratio

.  The Debt to Capitalization
Ratio shall be less than or equal to 0.65 to 1.00 at the end of each Fiscal Quarter;
provided, that for any Fiscal Quarter ending on or after the date that is 1
year following the closing date of the Unilin Acquisition, the Debt to
Capitalization Ratio shall be less than or equal to 0.60 to 1.00 at the end of
each Fiscal Quarter.

Restricted Payments

.  The
Guarantor shall not declare or make any Restricted
Payment unless, after giving effect thereto, no Default or Event of Default
shall exist. 

Investments

31

NY:791404.13                                                                                                                                                                                         

.  The Guarantor will not, and will not permit any of its Subsidiaries to, make or
maintain any Investments except (a) Investments in the Guarantor or any Subsidiary, including without limitation, advances or loans
between or among the Guarantor or any Subsidiary and loans and advances
to officers and employees of the Guarantor
or any Subsidiary in the
ordinary course of business; (b) Investments in Persons (whether or not such
Person is, or after giving effect to any such Investment becomes, a
Subsidiary); provided that the Guarantor will be in compliance with Section 5.07
after giving effect to such Investment; (c) Investments in Persons in connection
with Permitted Acquisitions; and (d) Investments in Approved Investments;
provided, however, during the existence of an Event of Default, neither the Guarantor nor any of its Subsidiaries may make any new Investments without
the prior written consent of the Required Banks.

Negative Pledge

.  Neither the Guarantor nor any of its Subsidiaries will
create, assume or suffer to exist any Lien on any asset now owned or hereafter
acquired by it, except:

Liens existing on the date of
this Agreement securing Debt outstanding on the date of this Agreement in an
aggregate principal amount not exceeding $5,000,000; 

Liens existing on the date of
this Agreement and described on Schedule 5.06;

any Lien existing on (i) any
asset of any Person at the time such Person becomes a Consolidated Subsidiary
or is merged or consolidated with or into the Guarantor or a Consolidated
Subsidiary (including in connection with the Unilin Acquisition) and (ii) any
asset prior to the acquisition thereof by the Guarantor or a Consolidated
Subsidiary, in each case, not created in contemplation of such event;

any Lien on any asset
securing Debt incurred or assumed for the purpose of financing all or any part
of the cost of acquiring or constructing such asset, provided that such
Lien attaches to such asset concurrently with or within 18 months after the
acquisition or completion of construction thereof;

Liens securing Debt owing by
any Subsidiary to the Guarantor;

any Lien arising out of the
refinancing, extension, renewal or refunding of any Debt secured by any Lien
permitted by any of the foregoing paragraphs of this Section, provided
that (i) such Debt is not secured by any additional assets, and (ii) the amount
of such Debt secured by any such Lien is not increased;

Liens incidental to the
conduct of its business or the ownership of its assets which (i) do not secure
Debt and (ii) do not, in the aggregate, materially detract from the value of
its assets or materially impair the use thereof in the operation of its
business;

any Lien on Margin Stock;

Liens in connection with an
Asset Securitization permitted under Section 5.09;

Liens involuntarily imposed
and being contested in good faith, subject to the Guarantor or such Subsidiary
having established reasonable reserves therefor to the extent required under
GAAP;

Liens against the assets of
Aladdin (formerly owned by Galaxy) under the Catoosa Co. IRB solely to the
extent existing as of the date hereof; 

Liens against the assets of
Aladdin (formerly owned by Image Industries, Inc.) under the Summerville City
IRB solely to the extent existing as of the date of the acquisition by Aladdin
of certain assets of Image Industries, Inc. as contemplated by that
certain Asset Purchase Agreement dated as of November 12, 1998, by and among
Aladdin, Image Industries, Inc. and The Maxim Group, Inc., as amended and
restated on January 29, 1999; and

Liens granted to the
Administrative Agent for the benefit of the Administrative Agent and the Banks
under the Loan Documents; 

provided that Liens permitted by the foregoing paragraphs (a)
through (h) shall at no time secure Debt, when aggregated with outstanding Debt
of the Subsidiaries permitted pursuant to Section 5.18(e), in an
aggregate amount exceeding 15% of Consolidated Net Worth.

32

NY:791404.13                                                                                                                                                                                         

Maintenance
of Existence; Lines of Business

.  Other than as
permitted by Section 5.08 or 5.09, the Guarantor shall, and shall cause each
Subsidiary to, maintain its corporate existence. The Guarantor shall, and shall
cause each Subsidiary to, carry on its business in Permitted Lines of Business,
determined with respect to the Guarantor and its Subsidiaries taken as a whole.

Dissolution

.  Neither the Guarantor nor any of its Subsidiaries shall suffer or permit dissolution or
liquidation either in whole or in part or redeem or retire any shares of its
own stock or that of any Subsidiary, except through corporate reorganization to
the extent permitted by Section 5.09 or in connection with a Restricted Payment
which is not prohibited pursuant to Section 5.04.

Consolidation,
Mergers, Sales of Assets and Dissolution

(a)           The Borrower
shall maintain its corporate existence and shall not dissolve or liquidate,
consolidate or merge with or into, or sell, lease or otherwise transfer all or
any substantial part of its assets to, any other Person; provided that (i) the
Borrower may merge with another Person if (A) either the Borrower is the
survivor of such merger or the survivor of such merger is a Subsidiary of the
Guarantor and such Subsidiary expressly assumes all of the obligations of the
Borrower under this Agreement and all other Loan Documents to which the
Borrower is a party, and (B) immediately after giving effect to such merger, no
Default shall have occurred and be continuing; (ii) Subsidiaries of the
Borrower may merge with and into the Borrower; (iii) the Borrower may factor
receivables; (iv) the Borrower may effect Asset Securitizations; and (v) the
Borrower may sell assets subject to the requirements of Section 5.09(h) of the
Mohawk Credit Agreement.

(b)           The Guarantor
will not, nor will the Guarantor permit any Subsidiary to, consolidate or merge
with or into, or sell, lease or otherwise transfer all or any substantial part
of its assets to, any other Person, provided that (i) the Guarantor may merge
with another Person if (A) such Person was organized under the laws of the
United States of America or one of its states, (B) the Guarantor is the
corporation surviving such merger and (C) immediately after giving effect to
such merger, no Default shall have occurred and be continuing; (ii)
Subsidiaries of the Guarantor may merge with and into the Guarantor, any other
Subsidiary, or any other Person if after giving effect thereto such other
Person would be a Subsidiary; (iii) assets may be transferred from a Subsidiary
to the Guarantor or another Subsidiary; (iv) any Wholly-Owned Subsidiary may
dissolve or liquidate so long as the assets of such Subsidiary at the time of
such dissolution or liquidation are transferred to such Subsidiary's
shareholder and such shareholder assumes all of the liabilities of such
Subsidiary at the time of such dissolution or liquidation; (v) the Guarantor
and its Subsidiaries may factor receivables; (vi) the Guarantor and its
Subsidiaries may effect Asset Securitizations; (vii) the Guarantor and its
Subsidiaries may sell, transfer or otherwise dispose of assets (regardless of
whether such disposition takes the form of a merger or liquidation of a Subsidiary)
if the proceeds thereof are reinvested within 180 days thereafter in a
Permitted Line of Business owned by the Guarantor or such Subsidiary; and
(viii) the Guarantor and its Subsidiaries may sell, transfer or otherwise
dispose of additional assets (regardless of whether such disposition takes the
form of a merger or liquidation of a Subsidiary) not otherwise permitted
pursuant to this Section; provided that the aggregate book value of such assets
to be sold, transferred or otherwise disposed of, when combined with all other
assets sold, transferred or otherwise disposed of during the applicable Fiscal
Quarter and the immediately preceding three Fiscal Quarters (excluding those
asset sales otherwise permitted pursuant to this Section), do not constitute more
than 20% of Consolidated Tangible Assets at the end of the fourth Fiscal
Quarter immediately preceding such Fiscal Quarter.

Use of Proceeds

.  The proceeds of the
facilities made available under this Agreement shall be used by the Borrower
for its general corporate purposes, including the provision of stand-by letters of credit and Ancillary
Facilities for the benefit of, and
working capital to, the Borrower's Subsidiaries.  In no event shall any portion
of the proceeds of the facilities made available under this Agreement be used
by the Borrower for any purpose in violation of any applicable law or
regulation.

33

NY:791404.13                                                                                                                                                                                         

Compliance with
Laws; Payment of Taxes

.  The Guarantor will, and will cause each of its
Subsidiaries to, comply in all material respects with applicable laws (including but not limited to
ERISA), regulations and similar requirements of governmental authorities
(including but not limited to PBGC), except where the necessity of such
compliance is being contested in good faith through appropriate proceedings or
where noncompliance would not have or create a reasonable possibility of
causing a Material Adverse Effect. The Guarantor
will, and will cause each of
its Subsidiaries to, pay promptly when due, giving regard for any extensions
obtained, all taxes, assessments, governmental charges, claims for labor,
supplies, rent and other obligations which, if unpaid, might become a lien
against the property of either the Guarantor
or any Subsidiary, except (a)
liabilities being contested in good faith and against which, if requested by
the Banks, either the Guarantor or such Subsidiary will set up reserves in
accordance with GAAP and (b) to the extent any failure to comply with any of
the foregoing could not reasonably be expected to have a Material Adverse Effect.

Insurance

.  The Guarantor will maintain, and will cause each of its Subsidiaries to maintain
(either in the name of the Guarantor or in such Subsidiary's own name), with
financially sound and reputable insurance companies, insurance on all its property in at least such amounts and against at least
such risks as are usually insured against in the same general area by companies
of established repute engaged in the same or similar business, subject to the Guarantor's right to self-insure with respect to loss or damage to property
in an amount customarily self-insured against by such similarly situated
companies.

Change in Fiscal Year

.  The Guarantor shall give the Banks at least 30 day's prior written notice of any
change in the determination of its Fiscal Year. 

Maintenance of Property

.  Subject to the
rights of the Guarantor or any Subsidiary under Section 5.08 or
5.09, the Guarantor shall, and shall cause each Subsidiary to, maintain all of its
properties and assets in good working order, ordinary wear and tear and obsolescence excepted
(excluding losses due to fully insured, subject to commercially reasonable
deductibles, casualties).

Environmental Notices

.  The Guarantor shall furnish to the Banks prompt written notice of all
Environmental Liabilities, pending, threatened or anticipated Environmental
Proceedings, Environmental Notices, Environmental Judgments and Orders, and
Environmental Releases at, on, in, under or in any way affecting the Properties
or any adjacent property which would have a Material Adverse Effect, and all
relevant facts, events, or conditions relating thereto.

Environmental Matters

.  The Guarantor will not, nor will it permit any Third Party to, use, produce,
manufacture, process, treat, recycle, generate, store, dispose of, manage at,
or otherwise handle, or ship or transport to or from the Properties any
Hazardous Materials except for (a) Hazardous Materials such as cleaning
solvents, combustion enhancers, pesticides and other materials used, produced,
manufactured, processed, treated, recycled, generated, stored, disposed,
managed, or otherwise handled in the ordinary course of business in compliance
with all applicable Environmental Requirements and (b) Hazardous Materials with respect to which the presence thereof, any required
remediation with respect thereto, or the expenses, fines, penalties and other
costs relating thereto could not reasonably be expected to have a Material
Adverse Effect.

Environmental Release

34

NY:791404.13                                                                                                                                                                                         

.  The Guarantor agrees that upon the occurrence of an Environmental Release which
would have a Material Adverse Effect and which violates any Environmental
Requirement it will promptly investigate the extent of, and take appropriate
action to remediate such Environmental Release, whether or not ordered or
otherwise directed to do so by any Environmental Authority.

Debt of Subsidiaries

.  The Guarantor shall not
permit any Subsidiary to incur any Debt except for (a) Debt owed by a
Subsidiary to the Guarantor or another Subsidiary, (b) Debt deemed incurred in
connection with an Asset Securitization permitted under Section 5.09 of the
Mohawk Credit Agreement; (c) (i) Debt of Subsidiaries arising in connection
with the Summerville City IRB and the Catoosa Co. IRB and incurrence of
Reimbursement Obligations with respect to the Letters of Credit and (ii) other
Debt of Subsidiaries arising in connection with the issuance of bonds by
governmental authorities so long as such Debt is supported by a letter of
credit issued by a financial institution for the benefit of the Borrower and
the Borrower is obligated to such financial institution under a reimbursement
agreement for the reimbursement of amounts drawn under such letter of credit;
(d) Debt of the Borrower and its Subsidiaries in aggregate outstanding amount
not exceeding $150,000,000; and (e) in addition to Debt incurred under clauses
(a) through (d) of this Section, other Debt of the Subsidiaries, when
aggregated with Debt of the Borrower and its Subsidiaries secured by Liens
permitted pursuant to paragraphs (a) through (h) of Section 5.02, in an
aggregate amount not exceeding 15% of Consolidated Net Worth.

"Know Your Customer"
Checks.

If:

(1)           the
introduction of or any change in (or in the interpretation, administration or
application of) any law or regulation made after the date of this Agreement;

(2)           any change in
the status of the Borrower or Guarantor after the date of this Agreement; or

(3)           a proposed
assignment or transfer by a Bank of any of its rights and obligations under
this Agreement to a party that is not a Bank prior to such assignment or
transfer,

obliges the Administrative
Agent or any Bank (for itself or, in the case of the event described in
paragraph (iii) above, on behalf of any prospective new Bank) to comply with
"know your customer" or similar identification procedures in
circumstances where the necessary information is not already available to it, the Borrower and Guarantor shall promptly upon the
request of the Administrative Agent or any Bank supply, or procure the supply
of, such documentation and other evidence as is reasonably requested by the
Administrative Agent (for itself or on behalf of any Bank) or any Bank (for
itself or, in the case of the event described in paragraph (iii) above, on
behalf of any prospective new Bank) in order for the Administrative Agent, such
Bank or, in the case of the event described in paragraph (iii) above, any
prospective new Bank to carry out and be satisfied it has complied with all
necessary "know your customer" or other similar checks under all applicable laws
and regulations pursuant to the transactions contemplated in the Loan
Documents.

Each Bank shall promptly upon
the request of the Administrative Agent supply, or procure the supply of, such
documentation and other evidence as is reasonably requested by the
Administrative Agent (for itself) in order for the Administrative Agent to
carry out and be satisfied it has complied with all necessary "know your
customer" or other similar checks under all applicable laws and regulations
pursuant to the transactions contemplated in the Loan Documents.

The Borrower shall, by not
less than 10 Business Days' prior written notice to the Administrative Agent,
notify the Administrative Agent (which shall promptly notify the Banks) of its
intention to request that one of its Subsidiaries becomes an Additional
Borrower pursuant to Section 9.21 (Additional Borrowers).

35

NY:791404.13                                                                                                                                                                                         

Following the giving of any
notice pursuant to paragraph (c) above, if the accession of such Additional
Borrower obliges the Administrative Agent or any Bank to comply with "know your
customer" or similar identification procedures in circumstances where the
necessary information is not already available to it, the Borrower shall
promptly upon the request of the Administrative Agent or any Bank supply, or
procure the supply of, such documentation and other evidence as is reasonably
requested by the Administrative Agent (for itself or on behalf of any Bank) or
any Bank (for itself or on behalf of any prospective new Bank) in order for the
Administrative Agent or such Bank or any prospective new Bank to carry out and
be satisfied it has complied with all necessary "know your customer" or other
similar checks under all applicable laws and regulations pursuant to the
accession of such Subsidiary to this Agreement as an Additional Borrower.

DEFAULTS

Events of Default

.  If one or more of the
following events ("Events of Default") shall have occurred and be
continuing:

the Borrower shall fail to
pay when due any principal or any interest on any Loan or any fee or other
amount payable hereunder within 5 Business Days after such principal, interest,
fee or other amount shall become due (except at maturity on the applicable
Termination Date); or

the Borrower or Guarantor
shall fail to observe or perform any covenant or agreement contained or
incorporated by reference in this Agreement (other than those covered by
paragraph (a) above) and such failure shall not have been cured within 30 days
after the earlier to occur of (i) written notice thereof has been given to the
Borrower and the Guarantor by the Administrative Agent at the request of any
Bank or (ii) a Responsible Officer of the Guarantor otherwise becomes aware of
any such failure; or

any representation, warranty,
certification or statement made by the Borrower or the Guarantor in Article IV
of this Agreement or in any certificate, financial statement or other document
delivered pursuant to this Agreement or any of the other Loan Documents shall
prove to have been incorrect or misleading in any material respect when made
(or deemed made); or

the Guarantor or any
Subsidiary shall fail to make any payment in respect of Debt in excess of
$25,000,000 in the aggregate outstanding (other than pursuant to any of the
Loan Documents) when due, and such failure shall continue following any
applicable grace period; or

any event or condition shall
occur which results in the acceleration of the maturity of Debt in excess of
$25,000,000 in the aggregate outstanding of the Guarantor or any Subsidiary
(including, without limitation, any "put" of such Debt to the Guarantor or any
Subsidiary) or enables or, with the giving of notice or lapse of time or both,
would enable, the holders of such Debt or any Person acting on such holders'
behalf to accelerate the maturity thereof (including, without limitation, any
"put" of such Debt to the Guarantor or any Subsidiary); or

the Borrower or the Guarantor
shall commence a voluntary case or other proceeding seeking liquidation,
reorganization or other relief with respect to itself or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect or seeking the
appointment of a trustee, receiver, liquidator, custodian or other similar
official of it or any substantial part of its property, or shall consent to any
such relief or to the appointment of or taking possession by any such official
in an involuntary case or other proceeding commenced against it, or shall make
a general assignment for the benefit of creditors, or shall fail generally to
pay its debts as they become due, or shall take any corporate action to
authorize any of the foregoing; or

an involuntary case or other
proceeding shall be commenced against the Borrower or the Guarantor seeking
liquidation, reorganization or other relief with respect to it or its debts
under any bankruptcy, insolvency or other similar law now or hereafter in
effect or seeking the appointment of a trustee, receiver, liquidator, custodian
or other similar official of it or any substantial part of its property, and
such involuntary case or other proceeding shall remain undismissed and unstayed
for a period of 60 days; or an order for relief shall be entered against the
Borrower or the Guarantor under bankruptcy laws as now or hereafter in effect;
or

36

NY:791404.13                                                                                                                                                                                         

the Guarantor or any member
of the Controlled Group shall fail to pay when due any material amount which it
shall have become liable to pay to the PBGC or to a Plan under Title IV of
ERISA; or notice of intent to terminate a Plan or Plans (other than pursuant to
a standard termination) shall be filed under Title IV of ERISA by the Guarantor,
any member of the Controlled Group, any plan administrator or any combination
of the foregoing; or the PBGC shall institute proceedings under Title IV of
ERISA to terminate or to cause a trustee to be appointed to administer any such
Plan or Plans or a proceeding shall be instituted by a fiduciary of any such
Plan or Plans to enforce Section 515 or 4219(c)(5) of ERISA and such proceeding
shall not have been dismissed within 30 days thereafter; or a condition shall exist
by reason of which the PBGC would be entitled to obtain a decree adjudicating
that any such Plan or Plans must be terminated; or

one or more judgments or
orders for the payment of money in an aggregate amount in excess of $25,000,000
(exclusive of insurance coverage if any insurer shall have acknowledged such
coverage in writing) shall be rendered against the Guarantor or any Material
Subsidiary, as defined in the Mohawk Credit Agreement, and such judgment or
order shall continue unsatisfied and unstayed for a period of 30 days; or

one or more federal tax liens
securing an aggregate amount in excess of $5,000,000 shall be filed against the
Guarantor or any Material Subsidiary, as defined in the Mohawk Credit
Agreement,  under Section 6321 of the Code or a lien of the PBGC shall be filed
against the Guarantor or any Material Subsidiary, as defined in the Mohawk
Credit Agreement, under Section 4068 of ERISA and in either case such lien
shall remain undischarged for a period of 25 days after the date of filing; or

(i) any Person or two or more
Persons acting in concert shall have acquired, after the Closing Date,
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 the voting stock of the Guarantor; or (ii) as
of any date following the Closing Date a majority of the Board of Directors of
the Guarantor consists of individuals who were not either (A) directors of the Guarantor
as of the corresponding date of the previous year, (B) selected or nominated to
become directors by the Board of Directors of the Guarantor of which a majority
consisted of individuals described in clause (A), or (C) selected or nominated
to become directors by the Board of Directors of the Guarantor of which a
majority consisted of individuals described in clause (A) and individuals
described in clause (B); or

an "Event of Default" shall
occur under any of the other Loan Documents; or

(i) any of the Loan
Documents, including the Guarantee herein, shall cease to be enforceable or
(ii) the Borrower or the Guarantor shall assert that any Loan Document,
including the Guarantee herein, shall cease to be enforceable; 

then, and in every such
event, (A) the Administrative Agent shall, if requested by the Required Banks
by notice to the Borrower, terminate the Commitments and they shall thereupon
terminate, and (B) the Administrative Agent shall, if requested by the Required
Banks by notice to the Borrower, declare the Loans (together with accrued
interest thereon) and all other obligations of the Borrower owing hereunder to
be, and the Loans and all other obligations of the Borrower owing hereunder
shall thereupon become, immediately due and payable without presentment, demand,
protest or other notice of any kind, all of which are hereby waived by the
Borrower together with interest at the Default Rate accruing on the principal
amount thereof from and after the date of such Event of Default; provided
that if any Event of Default specified in paragraph (d) or (e) above occurs
with respect to the Borrower, without any notice to the Borrower or any other
act by the Administrative Agent or the Banks, the Commitments shall thereupon
terminate and the Loans (together with accrued interest thereon) and all other
obligations of the Borrower owing hereunder shall become immediately due and
payable without presentment, demand, protest or other notice of any kind, all
of which are hereby waived by the Borrower together with interest thereon at
the Default Rate accruing on the principal amount thereof from and after the
date of such Event of Default.  Notwithstanding the foregoing, each of the
Banks shall have available to it all other remedies at law or equity.

37

NY:791404.13                                                                                                                                                                                         

Amounts held in any cash
collateral account opened by the Administrative Agent pursuant to Section
2.14(b)(v) shall be applied by the Administrative Agent to the payment of
drafts drawn under such Letters of Credit, and the unused portion thereof after
all such Letters of Credit shall have expired or been fully drawn upon, if any,
shall be applied to repay the other obligations under this Agreement on a pro
rata basis.  After all such Letters of Credit shall have expired or been fully
drawn upon, all Reimbursement Obligations shall have been satisfied and all
other obligations under this Agreement and the other Loan Documents shall have
been paid in full, the balance, if any, in such cash collateral account shall
be returned to Borrower.

Notwithstanding any of the
foregoing to the contrary, upon the occurrence of an Event of Default, and at
any time thereafter if any Event of Default shall then be continuing, the
Administrative Agent may, with the consent of the Required Banks, and upon the
written (including telecopied) request of the Required Banks, shall, by written
notice to Borrower, require that any or all of the then outstanding Alternative
Currency Loans be prepaid on the last day of the then current Interest Period
with respect thereto.

Notice of Default

.  The Administrative Agent shall give notice to the
Borrower of any Default under Section 6.01(b) promptly upon being
requested to do so by any Bank and shall thereupon notify all Banks thereof.

Crediting of Payments and Proceeds

.  In the event that the
Borrower shall fail to pay any of the Loans when due and the Loans have been
accelerated pursuant to Section 6.01, all payments received by the Banks
upon the Loans and all net proceeds from the enforcement of the Loans shall be
applied: 

First, to payment of fees (including attorney fees),
indemnities and other expenses payable to the Administrative Agent in its
capacity as such and the Issuer in its capacity as such (ratably among the
Administrative Agent and the Issuer in proportion to the respective amounts
described in this clause First payable to them);

Second, to payment of fees, indemnities and other amounts
(other than principal and interest) payable to the Banks, including attorney
fees (ratably among the Banks in proportion to the respective amounts described
in this clause Second payable to them);

Third, to payment of accrued and unpaid interest on the
Loans and Reimbursement Obligations (ratably among the Banks in proportion to
the respective amounts described in this clause Third payable to them);

Fourth, to payment of unpaid principal of the Loans and
Reimbursement Obligations (ratably among the Banks in proportion to the
respective amounts described in this clause Fourth held by them);

Fifth, to the Administrative Agent for the account of the
Issuer, to cash collateralize any Letter of Credit Obligations then
outstanding; and

Last, the balance, if any, after all of the Loans,
Reimbursement Obligations, Letter of Credit Obligations and other obligations
of the Borrower hereunder have been indefeasibly paid in full, to the Borrower
or as otherwise required by law.

THE AGENT

Appointment; Powers and Immunities

38

NY:791404.13                                                                                                                                                                                         

.  Each Bank hereby
irrevocably appoints and authorizes the Administrative Agent to act as its
agent hereunder and under the other Loan Documents with such powers as are
specifically delegated to the Administrative Agent by the terms hereof and
thereof, together with such other powers as are reasonably incidental thereto. 
The Administrative Agent: (a) shall have no duties or responsibilities except
as expressly set forth in this Agreement and the other Loan Documents, and
shall not by reason of this Agreement or any other Loan Document be a trustee
for any Bank; (b) shall not be responsible to the Banks for any recitals,
statements, representations or warranties contained in this Agreement or any
other Loan Document, or in any certificate or other document referred to or
provided for in, or received by any Bank under, this Agreement or any other
Loan Document, or for the validity, effectiveness, genuineness, enforceability
or sufficiency of this Agreement or any other Loan Document or any other
document referred to or provided for herein or therein or for any failure by
the Borrower to perform any of its obligations hereunder or thereunder or for
the satisfaction of any condition set forth in Article III or elsewhere
herein, other than to confirm receipt of items expressly required to be
delivered to the Administrative Agent; (c) shall not have any duty to take any
discretionary action or exercise any discretionary powers, except discretionary
rights and powers expressly contemplated hereby or by the other Loan Documents
that the Administrative Agent is required to exercise as directed in writing by
the Required Banks (or such other number or percentage of the Banks as shall be
expressly provided for herein or in the other Loan Documents), provided that
the Administrative Agent shall not be required to take any action that, in its
opinion or the opinion of its counsel, may expose the Administrative Agent to
liability or that is contrary to any Loan Document or applicable law, and (d)
shall not be responsible for any action taken or omitted to be taken by it
hereunder or under any other Loan Document or any other document or instrument
referred to or provided for herein or therein or in connection herewith or
therewith, except for its own gross negligence or willful misconduct.  The
Administrative Agent may employ agents and attorneys‐in‐fact and
shall not be responsible for the negligence or misconduct of any such agents or
attorneys‐in‐fact selected by it with reasonable care.  The
exculpatory provisions of this Article shall apply to any such agent and any
such attorneys-in-fact, and shall apply to their respective activities in
connection with the syndication of the credit facilities provided for herein as
well as activities as Administrative Agent.  The provisions of this Article
VII are solely for the benefit of the Administrative Agent and the Banks,
and the Borrower shall not have any rights as a third party beneficiary of any
of the provisions hereof (other than Section 7.10).  In performing its
functions and duties under this Agreement and under the other Loan Documents,
the Administrative Agent shall act solely as agent of the Banks and does not
assume and shall not be deemed to have assumed any obligation towards or
relationship of agency or trust with or for the Borrower.  The duties of the
Administrative Agent shall be ministerial and administrative in nature, and the
Administrative Agent shall not have by reason of this Agreement or any other
Loan Document a fiduciary relationship or any implied duties, regardless of
whether a Default has occurred and is continuing, in respect of any Bank.

Reliance by Administrative Agent

.  The Administrative Agent shall be entitled to rely
upon any certification, notice or other communication (including any thereof by
telephone, telecopier, telegram or cable) believed by it to be genuine and
correct and to have been signed or sent by or on behalf of the proper Person or
Persons, and upon advice and statements of legal counsel, independent
accountants or other experts selected by the Administrative Agent.  In
determining compliance with any condition hereunder to the making of a Loan, or
the issuance of a Letter of Credit, that by its terms must be fulfilled to the
satisfaction of a Bank or the Issuer, the Administrative Agent may presume that
such condition is satisfactory to such Bank or the Issuer unless the
Administrative Agent shall have received notice to the contrary from such Bank
or the Issuer prior to the making of such Loan or the issuance of such Letter
of Credit.  The Administrative Agent may consult with legal counsel (who may be
counsel for the Borrower), independent accountants and other experts selected
by it, and shall not be liable for any action taken or not taken by it in
accordance with the advice of any such counsel, accountants or experts.  As to
any matters not expressly provided for by this Agreement or any other Loan
Document, the Administrative Agent shall in all cases be fully protected in
acting, or in refraining from acting, hereunder and thereunder in accordance
with instructions signed by the Required Banks, and such instructions of the
Required Banks in any action taken or failure to act pursuant thereto shall be
binding on all of the Banks.

Defaults

.  The Administrative Agent
shall not be deemed to have knowledge of the occurrence of a Default or an
Event of Default (other than the nonpayment of principal of or interest on the
Loans) unless the Administrative Agent has received notice from a Bank or
the Borrower specifying such Default or Event of Default and stating that such
notice is a "Notice of Default".  In the event that the Administrative Agent
receives such a notice of the occurrence of a Default or an Event of Default,
the Administrative Agent shall give prompt notice thereof to the Banks.  The
Administrative Agent shall (subject to Section 9.06) take such
action hereunder with respect to such Default or Event of Default as shall be
directed by the Required Banks, provided that, unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it
shall deem advisable in the best interests of the Banks.

Rights of Administrative Agent and its Affiliates as a
Bank

39

NY:791404.13                                                                                                                                                                                         

.  With respect to the Loans
made by the Administrative Agent and any Affiliate of the Administrative Agent,
KBC in its capacity as a Bank hereunder and any Affiliate of the Administrative
Agent or such Affiliate in its capacity as a Bank hereunder shall have the same
rights and powers hereunder as any other Bank and may exercise the same as
though KBC were not acting as the Administrative Agent, and the term "Bank" or
"Banks" shall, unless the context otherwise indicates, include KBC in its
individual capacity and any Affiliate of the Administrative Agent in its
individual capacity.  The Administrative Agent and any Affiliate of the
Administrative Agent may (without having to account therefor to any
Bank) accept deposits from, lend money to and generally engage in any kind
of banking, trust or other business with the Borrower (and any of the
Borrower's Affiliates) as if KBC were not acting as the Administrative
Agent, and the Administrative Agent and any Affiliate of the Administrative
Agent may accept fees and other consideration from the Borrower (and any of the
Borrower's Affiliates) (in addition to any agency fees and arrangement fees
heretofore agreed to between the Borrower and the Administrative Agent) for
services in connection with this Agreement or any other Loan Document or
otherwise without having to account for the same to the Banks.

Indemnification

.  Each Bank severally agrees
to indemnify the Administrative Agent, to the extent the Administrative Agent
shall not have been reimbursed by the Borrower, in accordance with its
Commitment Percentage, for any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses (including, without
limitation, counsel fees and disbursements) or disbursements of any kind and
nature whatsoever which may be imposed on, incurred by or asserted against the
Administrative Agent in any way relating to or arising out of this Agreement or
any other Loan Document or any other documents contemplated by or referred to
herein or therein or the transactions contemplated hereby or thereby
(excluding, unless an Event of Default has occurred and is continuing, the
normal administrative costs and expenses incident to the performance of its
agency duties hereunder) or the enforcement of any of the terms hereof or
thereof or any such other documents; provided that no Bank shall be liable for
any of the foregoing to the extent they arise from the gross negligence or
willful misconduct of the Administrative Agent.  If any indemnity furnished to
the Administrative Agent for any purpose shall, in the opinion of the
Administrative Agent, be insufficient or become impaired, the Administrative
Agent may call for additional indemnity and cease, or not commence, to do the
acts indemnified against until such additional indemnity is furnished.  

Intentionally Omitted.

[Reserved]

.  

Nonreliance on Administrative Agent and Other Banks

.  Each Bank agrees that it
has, independently and without reliance on the Administrative Agent or any
other Bank, and based on such documents and information as it has deemed
appropriate, made its own credit analysis of the Borrower and decision to enter
into this Agreement and that it will, independently and without reliance upon
the Administrative Agent or any other Bank, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
analysis and decisions in taking or not taking action under this Agreement or
any of the other Loan Documents.  The Administrative Agent shall not be
required to keep itself (or any Bank) informed as to the performance or
observance by the Borrower of this Agreement or any of the other Loan Documents
or any other document referred to or provided for herein or therein or to
inspect the properties or books of the Borrower or any other Person.  Except
for notices, reports and other documents and information expressly required to
be furnished to the Banks by the Administrative Agent hereunder or under the
other Loan Documents, the Administrative Agent shall not have any duty or
responsibility to provide any Bank with any credit or other information concerning
the affairs, financial condition or business of the Borrower or any other
Person (or any of their Affiliates) which may come into the possession of
the Administrative Agent.

Failure to Act

.  Except for action
expressly required of the Administrative Agent hereunder or under the other
Loan Documents, the Administrative Agent shall in all cases be fully justified
in failing or refusing to act hereunder and thereunder unless it shall receive
further assurances to its satisfaction by the Banks of their indemnification
obligations under Section 7.05 against any and all liability and
expense which may be incurred by the Administrative Agent by reason of taking,
continuing to take, or failing to take any such action.

Resignation of Administrative Agent.

40

NY:791404.13                                                                                                                                                                                         

The Administrative Agent may
at any time give notice of its resignation to the Banks, the Issuer and the
Borrower.  Upon receipt of any such notice of resignation, the Required Banks
shall have the right, with the prior written consent of the Borrower (provided that
no Default or Event of Default exists), to appoint a successor, which shall be
a bank with an office in the EMU, or an Affiliate of any such bank with an
office in the EMU.  If no such successor shall have been so appointed by the
Required Banks and shall have accepted such appointment within 30 days
after the retiring Administrative Agent gives notice of its resignation, then
the retiring Administrative Agent may on behalf of the Banks and the Issuer,
appoint a successor Administrative Agent meeting the qualifications set forth
above provided that if the Administrative Agent shall notify the Borrower and
the Banks that no qualifying Person has accepted such appointment, then such
resignation shall nonetheless become effective in accordance with such notice
and (1) the retiring Administrative Agent shall be discharged from its duties
and obligations hereunder and under the other Loan Documents (except that in
the case of any collateral security held by the Administrative Agent on behalf
of the Banks or the Issuer under any of the Loan Documents, the retiring
Administrative Agent shall continue to hold such collateral security until such
time as a successor Administrative Agent is appointed) and (2) all
payments, communications and determinations provided to be made by, to or
through the Administrative Agent shall instead be made by or to each Bank and
the Issuer, as applicable, directly, until such time as the Required Banks
appoint a successor Administrative Agent as provided for above in this
paragraph.  Upon the acceptance of a successor's appointment as Administrative
Agent hereunder, such successor shall succeed to and become vested with all of
the rights, powers, privileges and duties of the retiring (or retired)
Administrative Agent, and the retiring Administrative Agent shall be discharged
from all of its duties and obligations hereunder or under the other Loan
Documents (if not already discharged therefrom as provided above in this
paragraph).  The fees payable by the Borrower to a successor Administrative
Agent shall be the same as those payable to its predecessor unless otherwise
agreed between the Borrower and such successor.  After the retiring
Administrative Agent's resignation hereunder and under the other Loan
Documents, the provisions of this Article and Section 9.04 shall
continue in effect for the benefit of such retiring Administrative Agent, its
sub‐agents and their respective Affiliates in respect of any actions
taken or omitted to be taken by any of them while the retiring Administrative Agent
was acting as Administrative Agent.

Any resignation by KBC as
Administrative Agent pursuant to this Section shall also constitute its
resignation as the Issuer.  Upon the acceptance of a successor's appointment as
Administrative Agent hereunder, (a) such successor shall succeed to and become
vested with all of the rights, powers, privileges and duties of the retiring
Issuer, (b) the retiring Issuer shall be discharged from all of its respective
duties and obligations hereunder or under the other Loan Documents, and (c) the
successor Issuer shall issue letters of credit in substitution for the Letters
of Credit, if any, outstanding at the time of such succession or make other
arrangement satisfactory to the retiring Issuer to effectively assume the obligations
of the retiring Issuer with respect to such Letters of Credit.

CHANGE IN CIRCUMSTANCES;
TAXES; COMPENSATION

Basis for Determining Interest Rate Inadequate or
Unfair

.  If on or prior to the
first day of any Interest Period: 

in the case of an Alternative
Currency Loan, the Administrative Agent determines that deposits in the
applicable Alternative Currency (in the applicable amounts) are not being
offered in the relevant market for such Interest Period, 

the Administrative Agent
determines that a fundamental
change has occurred in the foreign exchange or interbank markets with respect
to any Alternative Currency (including, without limitation, changes in national
or international financial, political or economic conditions or currency
exchange rates or exchange controls) that increases
the costs of the Administrative Agent or
any Bank to make such Alternative Currency Loans or it has become otherwise
materially impractical for the Administrative Agent or such Bank to make any
Alternative Currency Loans, or

the Required Banks advise the
Administrative Agent that EURIBOR as determined by the Administrative Agent
will not adequately and fairly reflect the cost to such Banks of funding the
relevant Eurocurrency Loans for such Interest Period,

then the Administrative Agent
shall forthwith give notice thereof to the Borrower and the Banks, whereupon
until the Administrative Agent notifies the Borrower that the circumstances
giving rise to such suspension no longer exist (which the Administrative Agent
agrees to do promptly upon such circumstances ceasing to exist), the
obligations of the Banks to make any Eurocurrency Loan (or the obligation of
such Bank to make and maintain Alternative Currency Loans), specified in such
notice shall be suspended.  

41

NY:791404.13                                                                                                                                                                                         

Illegality

.  If, after the date hereof,
the adoption of any applicable law, rule or regulation, or any change therein,
or any change in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with the interpretation
or administration thereof (any such agency being referred to as an "Authority"
and any such event being referred to as a "Change of Law"), or
compliance by any Bank (or its Lending Office) with any request or directive
(whether or not having the force of law) of any Authority shall make it
unlawful or impossible for any Bank (or its Lending Office) to make, maintain
or fund any Loan, and such Bank shall so notify the Administrative Agent, the
Administrative Agent shall forthwith give notice thereof to the other Banks and
the Borrower, whereupon until such Bank notifies the Borrower and the
Administrative Agent that the circumstances giving rise to such suspension no
longer exist (which the Administrative Agent agrees to do promptly upon such circumstances
ceasing to exist), the obligation of such Bank to make such Loans shall be
suspended.  Before giving any notice to the Administrative Agent pursuant to
this Section, such Bank shall designate a different Lending Office if such
designation will avoid the need for giving such notice and will not, in the
judgment of such Bank, be otherwise materially disadvantageous to such Bank. 
If such Bank shall determine that it may not lawfully continue to maintain and
fund any of its outstanding Loans to maturity and shall so specify in such
notice, the Borrower shall immediately prepay in full the then outstanding
principal amount of such Loans of such Bank, together with accrued interest
thereon and any amount due pursuant to Section 8.04(a).  

Increased Cost and Reduced Return

.  

(a)           If after the
date hereof, a Change of Law or compliance by any Bank (or its Lending Office)
with any request or directive (whether or not having the force of law) of any
Authority:

shall subject any Bank (or
its Lending Office) to any tax, duty or other charge with respect to its Loans
or its obligation to make Loans or shall change the basis of taxation of
payments to any Bank (or its Lending Office) of the principal of or interest on
its Loans or any other amounts due under this Agreement in respect of its Loans
or its obligation to make Loans (except for changes in the rate of tax on the
overall net income of such Bank or its Lending Office imposed by the
jurisdiction in which such Bank's principal executive office or Lending Office
is located); or

shall impose, modify or deem
applicable any reserve, special deposit or similar requirement against assets
of, deposits with or for the account of, or credit extended by, any Bank (or
its Lending Office) with respect to Loans; or

shall impose on any Bank (or
its Lending Office) or on the London interbank market any other condition
affecting its Loans or its obligation to make Loans;

and the result of any of the
foregoing is to increase the cost to such Bank (or its Lending Office) of making
or maintaining any Loan, or to reduce the amount of any sum received or
receivable by such Bank (or its Lending Office) under this Agreement with
respect thereto, by an amount deemed by such Bank to be material, then, within
15 days after demand by such Bank (with a copy to the Administrative Agent),
the Borrower shall pay to such Bank such additional amount or amounts as will
compensate such Bank for such increased cost or reduction.

(b)           If any Bank
shall have determined that after the date hereof the adoption of any applicable
law, rule or regulation regarding capital adequacy, or any change therein, or
any change in the interpretation or administration thereof, or compliance by
any Bank (or its Lending Office) with any request or directive regarding
capital adequacy (whether or not having the force of law) of any Authority, has
or would have the effect of reducing the rate of return on such Bank's capital
as a consequence of its obligations hereunder with respect to Loans to a level
below that which such Bank could have achieved but for such adoption, change or
compliance (taking into consideration such Bank's policies with respect to
capital adequacy) by an amount deemed by such Bank to be material, then from
time to time, within 15 days after demand by such Bank, the Borrower shall pay
to such Bank such additional amount or amounts as will compensate such Bank for
such reduction.

42

NY:791404.13                                                                                                                                                                                         

(c)           Each Bank will
promptly notify the Borrower and the Administrative Agent of any event of which
it has knowledge, occurring after the date hereof, which will entitle such Bank
to compensation pursuant to this Section and will 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 Bank, be otherwise
materially disadvantageous to such Bank.  In determining such amount, such Bank
may use any reasonable averaging and attribution methods.

(d)           The provisions
of this Section 8.03 shall be applicable with respect to any Participant,
Assignee or other Transferee (unless the date of any such assignment or
transfer, a condition listed under Section 8.02 or 8.03
existed with respect to any such Participant, Assignee or other Transferee),
and any calculations required by such provisions shall be made based upon the
circumstances of such Participant, Assignee or other Transferee.  Amounts paid
pursuant to this Section 8.03 shall be without duplication of amounts
required to be paid pursuant to Section 8.07.

(e)           The provisions
of this Section 8.03 shall not apply to any increased cost,
reduction of any sum receivable under this Agreement, or reduced rate of return
to the extent attributable to the application of or compliance with the
International Convergence of Capital Measurement Standards published by the
Basel Committee on Banking Supervision in June 2004 ("Basel II"), or any
implementation or transposition thereof, as such implementation or
transposition is generally envisaged to take place as at the date of this
Agreement, whether by an EC Directive or the FSA Integrated Prudential
Sourcebook or other law or regulation.

Compensation

.  Upon the request of any
Bank, delivered to the Borrower and the Administrative Agent, the Borrower
shall pay to such Bank such amount or amounts as shall compensate such Bank for
any loss, cost or expense actually incurred by such Bank (including, without
limitation, any foreign exchange costs) and not compensated pursuant to Section 8.03
as a result of:

any payment or prepayment
(pursuant to Section 2.10(b), Section 8.02 or otherwise) of a
Eurocurrency Loan on a date other than the last day of an Interest Period for
such Eurocurrency Loan; or

any failure by the Borrower
to prepay a Eurocurrency Loan on the date for such prepayment specified in the
relevant notice of prepayment hereunder; or

any failure by the Borrower
to borrow a Eurocurrency Loan on the date for the Eurocurrency Borrowing of
which such Eurocurrency Loan is a part specified in the applicable Notice of
Borrowing delivered pursuant to Section 2.02; or

any failure by the Borrower
to continue a Eurocurrency Loan on the date specified in the applicable Notice
of Continuation delivered pursuant to Section 2.03; 

such compensation to include,
without limitation, an amount equal to the excess, if any, of (x) the amount of
interest which would have accrued on the amount so paid or prepaid or not
prepaid, borrowed, continued or converted for the period from the date of such
payment, prepayment or failure to prepay, borrow, continue or convert to the
last day of the then current Interest Period for such Eurocurrency Loan (or, in
the case of a failure to prepay, borrow or continue, the Interest Period for
such Eurocurrency Loan which would have commenced on the date of such failure
to prepay, borrow, continue or convert) at the applicable rate of interest for
such Eurocurrency Loan provided for herein over (y) the amount of interest (as
reasonably determined by such Bank) such Bank would have paid on deposits in
the applicable Permitted Currency of comparable amounts having terms comparable
to such period placed with it by leading banks in the London interbank market. 
A certificate of any Bank claiming compensation under this Section and setting
forth the additional amount or amounts to be paid to it hereunder shall be
conclusive in the absence of manifest error.  

Taxes.

43

NY:791404.13                                                                                                                                                                                         

Payments
Free of Taxes. 
Any and all payments by or on account of any obligation of the Borrower
hereunder or under any other Loan Document shall be made free and clear of and
without reduction or withholding for any Indemnified Taxes or Other Taxes; provided
that if the Borrower shall be required by applicable law to deduct any
Indemnified Taxes (including any Other Taxes) from such payments, then (i) the
sum payable shall be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section) the Administrative Agent, Bank or Issuer, as the case may be,
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions and (iii)
the Borrower shall timely pay the full amount deducted to the relevant
Authority in accordance with applicable law. 

Payment
of Other Taxes by the Borrower. Without limiting the provisions of paragraph (a)
above, the Borrower shall timely pay any Other Taxes to the relevant Authority
in accordance with applicable law. 

Indemnification
by the Borrower.
The Borrower shall indemnify the Administrative Agent, each Bank and the
Issuer, within 30 days after written demand therefor, for the full amount of
any Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other
Taxes imposed or asserted on or attributable to amounts payable under this
Section) paid by the Administrative Agent, such Bank or the Issuer, as the case
may be, and any penalties, interest and reasonable expenses arising therefrom
or with respect thereto, whether or not such Indemnified Taxes or Other Taxes
were correctly or legally imposed or asserted by the relevant Authority.  A
certificate as to the amount of such payment or liability delivered to the
Borrower by a Bank or the Issuer (with a copy to the Administrative Agent), or
by the Administrative Agent on its own behalf or on behalf of a Bank or the
Issuer, shall be conclusive absent manifest error. 

Evidence
of Payments. As
soon as practicable after any payment of Indemnified Taxes or Other Taxes by
the Borrower to a Authority, the Borrower shall deliver to the Administrative
Agent the original or a certified copy of a receipt issued by such Authority
evidencing such payment, a copy of the return reporting such payment or other
evidence of such payment reasonably satisfactory to the Administrative Agent. 

Status
of Banks. Any
Foreign Bank that is entitled to an exemption from or reduction of withholding
tax under the law of the jurisdiction in which the Borrower is resident for tax
purposes, or any treaty to which such jurisdiction is a party, with respect to
payments hereunder or under any other Loan Document shall deliver to the
Borrower (with a copy to the Administrative Agent), at the time or times
prescribed by applicable law or reasonably requested by the Borrower or the
Administrative Agent, such properly completed and executed documentation
prescribed by applicable law as will permit such payments to be made without
withholding or at a reduced rate of withholding.  In addition, any Bank, if
requested by the Borrower or the Administrative Agent, shall deliver such other
documentation prescribed by applicable law or reasonably requested by the
Borrower or the Administrative Agent as will enable the Borrower or the
Administrative Agent to determine whether or not such Bank is subject to backup
withholding or information reporting requirements.  

Treatment
of Certain Refunds.  If the Administrative Agent, a Bank or the Issuer determines, in its
reasonable discretion, that it has received a refund or a foreign tax credit of
any Taxes or Other Taxes as to which it has been indemnified by the Borrower or
with respect to which the Borrower has paid additional amounts pursuant to this
Section, it shall pay to the Borrower an amount equal to such refund or credit
(but only to the extent of indemnity payments made, or additional amounts paid,
by the Borrower under this Section with respect to the Taxes or Other Taxes
giving rise to such refund), net of all out-of-pocket expenses of the
Administrative Agent, such Bank or the Issuer, as the case may be, and without
interest (other than any interest paid by the relevant Authority with respect
to such refund); provided that the Borrower, upon the request of the
Administrative Agent, such Bank or the Issuer, agrees to repay the amount paid
over to the Borrower (plus any penalties, interest or other charges imposed by
the relevant Authority) to the Administrative Agent, such Bank or the Issuer in
the event the Administrative Agent, such Bank or the Issuer is required to
repay such refund to such Authority.  This paragraph shall not be construed to
require the Administrative Agent, any Bank or the Issuer to make available its
tax returns (or any other information relating to its taxes which it deems
confidential) to the Borrower or any other Person.

Survival.  Without prejudice to the survival of any other agreement
of the Borrower hereunder, the agreements and obligations of the Borrower
contained in this Section shall survive the payment in full of the obligations
of the Borrower hereunder and the termination of the Commitments.

Replacement of Banks

44

NY:791404.13                                                                                                                                                                                         

.  If any Bank or the
Administrative Agent, as applicable (an "Affected Bank") makes demand
for amounts owed under Section 8.03 or Section 8.05, or
gives notice under Section 8.01 or 8.02 that it can no longer
participate in Loans then in each case the Borrower shall have the right, if no
Default or Event of Default exists, and subject to the terms and conditions set
forth in Section 9.07(c) with respect to assignments of Loans, to
designate an Assignee (a "Replacement Bank") to purchase the Affected
Bank's share of outstanding Loans and all other obligations hereunder and to
assume the Affected Bank's obligations to the Borrower under this Agreement; provided,
that, any Replacement Bank may not be an Affiliate of the Borrower.  Subject to
the foregoing, the Affected Bank agrees to assign without recourse to the
Replacement Bank its share of outstanding Loans and its Commitment, and to
delegate to the Replacement Bank its obligations to the Borrower under this
Agreement.  Upon such sale and delegation by the Affected Bank and the purchase
and assumption by the Replacement Bank, and compliance with the provisions of Section
9.07(c), the Affected Bank shall cease to be a "Bank" hereunder and the
Replacement Bank shall become a "Bank" under this Agreement; provided, however,
that any Affected Bank shall continue to be entitled to the indemnification
provisions contained elsewhere herein.

Alternative
Currency Matters

.

(a)           Effectiveness
of Euro Provisions.  With respect
to any state (or the currency of such state) that is not a Participating Member
State on the date of this Agreement, the provisions of this Section 8.07
shall become effective in relation to such state (and the currency of such
state) at and from the date on which such state becomes a Participating Member
State.

(b)           Basis of
Accrual.  Subject to clause (a) above, with respect to the currency of any
state that becomes a Participating Member State, the accrual of interest or
fees expressed in this Agreement with respect to such currency shall be based
upon the applicable convention or practice in the London interbank market for
the basis of accrual of interest or fees in respect of the Euro, which such
convention or practice shall replace such expressed basis effective as of and
from the date on which such state becomes a Participating Member State; provided
that if any Syndicated Loan in the currency of such state is outstanding
immediately prior to such date, such replacement shall take effect, with
respect to such Syndicated Loan, at the end of the then current Interest
Period.

(c)           Redenomination of Alternative Currency Loans.

(i)            Redenomination
of Loans.  Subject to clause (a) above, any Loan to be denominated in the
currency of the applicable Participating Member State shall be made in the
Euro.

(ii)           Redenomination
of Obligations.   Subject to clause (a) above, any obligation of any party
under this Agreement or any other Loan Document which has been denominated in
the currency of a Participating Member State shall be redenominated into the
Euro. 

(iii)          Further
Assurances.  The terms and provisions of this Agreement will be subject to
such reasonable changes of construction as determined by the Administrative
Agent to reflect the implementation of the EMU in any Participating Member
State or any market conventions relating to the fixing and/or calculation of
interest being changed or replaced and to reflect market practice at that time,
and subject thereto, to put the Administrative Agent, the Banks and the
Borrower in the same position, so far as possible, that they would have been if
such implementation had not occurred.  In connection therewith, the Borrower
agrees, at the request of the Administrative Agent, at the time of or at any
time following the implementation of the EMU in any Participating Member State
or any market conventions relating to the fixing and/or calculation of interest
being changed or replaced, to enter into an agreement amending this Agreement
in such manner as the Administrative Agent shall reasonably request.

45

NY:791404.13                                                                                                                                                                                         

                (d)           Regulatory Limitation.  In the
event, as a result of increases in the value of Alternative Currencies against
the Euro or for any other reason, the obligation of any of the Banks to make or
continue Loans or issue or extend Letters of Credit (taking into account the
Euro Amount of the Obligations and all other indebtedness required to be
aggregated under any applicable law or regulation) is determined by such Bank
to exceed its then applicable legal lending limit under any applicable law or
regulation, the amount of additional Loans or Letters of Credit such Bank shall
be obligated to make or issue or participate in hereunder shall immediately be
reduced to the maximum amount which such Bank may legally advance (as
determined by such Bank), the obligation of each of the remaining Banks
hereunder shall be proportionately reduced, based on their applicable pro rata
share of the Commitments and, to the extent necessary under such laws and
regulations (as determined by each of the Banks, with respect to the
applicability of such laws and regulations to itself), and the Borrower shall
reduce, or cause to be reduced, complying to the extent practicable with the
remaining provisions hereof, the Loans and Letters of Credit outstanding
hereunder by an amount sufficient to comply with such maximum amounts.

                (e)           Exchange
Indemnification and Increased Costs.  The Borrower shall, upon demand from
the Administrative Agent, pay to the Administrative Agent, the Issuer or any
Bank, the amount of (i) any loss or cost or increased cost incurred by the
Administrative Agent, the Issuer or any Bank, (ii) any reduction in any amount
payable to or in the effective return on the capital to the Administrative
Agent, the Issuer or any Bank, (iii) any interest or any other return,
including principal, foregone by the Administrative Agent, the Issuer or any
Bank as a result of the introduction of, change over to or operation of the
Euro, or (iv) any currency exchange loss that the Administrative Agent, the
Issuer or any Bank sustains as a result of any payment being made by the
Borrower in a currency other than that originally extended to the Borrower or
as a result of any other currency exchange loss incurred by the Administrative
Agent, the Issuer or any Bank under this Agreement.  A certificate of the
Administrative Agent, the Issuer or such Bank setting forth the basis for
determining such additional amount or amounts necessary to compensate the
Administrative Agent, the Issuer or such Bank shall be conclusive absent
manifest error.

(f)            Exchange
Rates.  For purposes of determining the Borrower's compliance with Section
2.11 or the borrowing limits set forth in Section 2.01 and Section
2.14, the Euro  Amount of any Alternative Currency Loan or Alternative
Currency Letter of Credit to be made, continued, converted or issued shall be
determined in accordance with the terms of this Agreement by the Administrative
Agent (in respect of the most recent Revaluation Date).  Such Euro Amount shall
become effective as of such Revaluation Date for such Alternative Currency Loan
or Alternative Currency Letter of Credit and shall be the Euro Amount employed
in converting any amounts between the applicable currencies until the next
Revaluation Date to occur for such Alternative Currency Loan or Alternative
Currency Letter of Credit.

                (g)           Rounding
and Other Consequential Changes.  Subject to clause (a) above, without
prejudice and in addition to any method of conversion or rounding prescribed by
any EMU Legislation and without prejudice to the respective obligations of the
Borrower to the Administrative Agent and the Banks and the Administrative Agent
and the Banks to the Borrower under or pursuant to this Agreement, except as
expressly provided in this Agreement, each provision of this Agreement,
including, without limitation, the right to combine currencies to effect a
set-off, shall be subject to such reasonable changes of interpretation as the
Administrative Agent may from time to time specify to be necessary or
appropriate to reflect the introduction of or change over to the Euro in
Participating Member States.                

                (h)           Continuity
of Contract.  The parties hereto
agree that the occurrence or non-occurrence of EMU, any event or events
associated with EMU and/or the introduction of the Euro in all or any part of
the European Union (a) will not result in the discharge, cancellation,
rescission or termination in whole or in part of this Agreement or any other
Loan Document, (b) will not give any party the right to cancel, rescind,
terminate or vary this Agreement or any other Loan Document and (c) will not
give rise to an Event of Default, in each case other than as specifically
provided in this Agreement.

MISCELLANEOUS

Notices

.

Method of Communication.  Except as otherwise provided in this Agreement, all
notices and communications hereunder shall be in the English language and given
in writing.  Any notice shall be effective if delivered by hand delivery,
telecopy, recognized overnight courier service or certified mail, return
receipt requested, and shall be presumed to be received by a party hereto (i)
on the date of delivery if delivered by hand or telecopy, (ii) on the next
Business Day if sent by recognized overnight courier service and (iii) on the 3rd
Business Day following the date sent by certified mail, return receipt
requested.

Addresses for Notices.  Notices to any party shall be sent to it at the
following addresses, or any other address as to which all the other parties are
notified in writing.

46

NY:791404.13                                                                                                                                                                                         

If to the Borrower:                Mohawk
International Holdings S.à r.l.

                6 Rue Adolphe Fischer

                L-1520
Luxembourg

                Attention: Hermanus Troskie

                Telephone
No.: +352 40 25 05 1

                Telecopy
No.: +352 40 25 05 66

With a copy to:    Mohawk Industries, Inc.

                160 South
Industrial Boulevard

Calhoun, Georgia  30703-7002

                Attention:
Chief Financial Officer or Treasurer

                Telephone
No.: (706) 624-2103

                Telecopy
No.: (706) 624-2052

and to:    Mohawk Industries, Inc.

                160 South
Industrial Boulevard

Calhoun, Georgia  30703-7002

                Attention:
Salvatore J. Perillo, Jr.

                Telephone
No.: (706) 629-7721

                Telecopy
No.: (706) 624-2483

If to KBC as          KBC
Bank NV

Administrative
Agent:        BRUHAV12/IBR

                Havenlaan
12

                B-1080
BRUSSELS

                Belgium

                Attention:
Dirk De Bleser / Peter De Wandeler

                Telephone
No.:  +32 2 429 42 76 / +32 2 429 58 68

                Telecopy
No.:  +32 2 429 49 20

47

NY:791404.13                                                                                                                                                                                         

                E-mail:
   dirk.debleser@kbc.be/ 

                                peter.dewandeler@kbc.be

If to any Bank:      To
the address set forth on Schedule 1.01(a).

Administrative Agent's
Office.  The Administrative Agent
hereby designates its office located at the address set forth above, or any
subsequent office which shall have been specified for such purpose by written
notice to the Borrower and the Banks to which payments due are to be made and
at which Loans will be disbursed and Letters of Credit requested.  

No
Waivers

.  No failure or delay by the
Administrative Agent or any Bank in exercising any right, power or privilege
hereunder or under any other Loan Document shall operate as a waiver thereof
nor shall any single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right, power or privilege.  The
rights and remedies herein provided shall be cumulative and not exclusive of
any rights or remedies provided by law.

Expenses

.  The Borrower shall pay (i)
all out‐of‐pocket expenses of the Administrative Agent, including
reasonable fees and disbursements actually incurred of special counsel for the
Administrative Agent, in connection with the preparation of this Agreement and
the other Loan Documents, any waiver or consent hereunder or thereunder or any
amendment hereof or thereof and (ii) if a Default or an Event of Default
occurs, all out‐of‐pocket expenses incurred by the Administrative
Agent and the Banks, including reasonable fees and disbursements of counsel,
actually incurred in connection with such Default and collection and other
enforcement proceedings resulting therefrom, including out‐of‐pocket
expenses incurred in enforcing this Agreement and the other Loan Documents.  

Indemnification;
Waiver of Consequential Damages

.  

The Borrower shall indemnify
the Administrative Agent, the Banks and each Affiliate thereof and their
respective directors, officers, employees and agents (each, an "Indemnified
Party") from, and hold each of them harmless against, any and all losses,
liabilities, claims or damages to which any of them may become subject, insofar
as such losses, liabilities, claims or damages arise out of or result from any
actual or proposed use by the Borrower of the proceeds of any extension of
credit by any Bank hereunder or breach by the Borrower of this Agreement or any
other Loan Document or from any investigation, litigation (including, without
limitation, any actions taken by the Administrative Agent or any of the Banks
to enforce this Agreement or any of the other Loan Documents) or other proceeding
(including, without limitation, any threatened investigation or proceeding)
relating to the foregoing, and the Borrower shall reimburse the Administrative
Agent and each Bank, and each Affiliate thereof and their respective directors,
officers, employees and agents, upon demand for any expenses (including,
without limitation, legal fees) incurred in connection with any such
investigation or proceeding; but excluding any such losses, liabilities,
claims, damages or expenses (i) incurred by reason of the gross negligence or
willful misconduct of the Person to be indemnified or (ii) to the extent
arising directly out of or resulting directly from claims of one or more
Indemnified Parties against another Indemnified Party.  

Consequential Damages.  THE ADMINISTRATIVE AGENT, THE BANKS, THE BORROWER
AND THE GUARANTOR (ON BEHALF OF ITSELF AND ITS SUBSIDIARIES) SHALL NOT BE
RESPONSIBLE OR LIABLE TO ANY SUCH PERSON OR ANY OTHER PERSON OR ENTITY FOR ANY
PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES WHICH MAY BE ALLEGED AS A RESULT
OF THIS AGREEMENT, THE OTHER LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY.

The agreements and
obligations of the Borrower contained in this Section shall survive the
termination of the Commitments and the payment in full of the Loans and the
other obligations hereunder.  

Sharing
of Setoffs

.  

48

NY:791404.13                                                                                                                                                                                         

                (a)           (i)            If an Event of Default shall
have occurred and be continuing, each Bank, and the Issuer is hereby authorized
at any time and from time to time, to the fullest extent permitted by
applicable law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final, in whatever currency) at any time held
and other obligations (in whatever currency) at any time owing by such Bank or
the Issuer to or for the credit or the account of the Borrower against any and
all of the obligations of the Borrower now or hereafter existing under this
Agreement or any other Loan Document to such Bank or the Issuer, irrespective
of whether or not such Bank or the Issuer shall have made any demand under this
Agreement or any other Loan Document and although such obligations of the
Borrower may be contingent or unmatured or are owed to a branch or office of
such Bank or the Issuer different from the branch or office holding such
deposit or obligated on such indebtedness.  The rights of each Bank and the
Issuer under this clause (i) are in addition to other rights and remedies
(including other rights of setoff) that such Bank or the Issuer may have.  Each
Bank and the Issuer agree to notify the Borrower and the Administrative Agent
promptly after any such setoff and application; provided that the
failure to give such notice shall not affect the validity of such setoff and
application.

                                (ii)           Any amount to be set-off
pursuant to clause (i) above shall be denominated in Euros and any amount
denominated in an Alternative Currency shall be in an amount equal to the Euro
Amount of such amount at the most
favorable spot exchange rate determined by the Administrative Agent to be
available to it; provided that if at the time of any such determination
no such spot exchange rate can reasonably be determined, the Administrative
Agent may use any reasonable method as it deems applicable to determine such
rate, any such determination to be conclusive absent manifest error.

                                (iii)          Each
Bank and any assignee or participant of such Bank in accordance with Section
9.08 are hereby authorized by the Borrower to combine currencies, as deemed
necessary by such Person, in order to effect any set-off pursuant to clause (i)
above.

                (b)           Each
Bank agrees that if it shall, by exercising any right of setoff or counterclaim
or otherwise, receive payment of a proportion of  the aggregate amount of
principal and interest owing to it under this Agreement which is greater than
the proportion received by any other Bank in respect of the aggregate amount of
all principal and interest owing to it under this Agreement, the Bank receiving
such proportionately greater payment shall purchase such participations in the
amounts owed to other Banks under this Agreement, and such other adjustments
shall be made, as may be required so that all such payments of principal and
interest received under this Agreement shall be shared by the Banks pro rata; provided
that (i) nothing in this Section shall impair the right of any Bank to exercise
any right of setoff or counterclaim it may have and to apply the amount subject
to such exercise to the payment of indebtedness of the Borrower other than its
indebtedness under this Agreement and (ii) if all or any portion of such
payment received by the purchasing Bank is thereafter recovered from such
purchasing Bank, such purchase from such other Banks shall be rescinded and
such other Bank shall repay to the purchasing Bank the purchase price of such
participation to the extent of such recovery together with an amount equal to
such other Banks' ratable share (according to the proportion of (A) the amount
of such other Banks' required repayment to (B) the total amount so recovered
from the purchasing Bank) of any interest or other amount paid or payable by
the purchasing Bank in respect of the total amount so recovered.  The Borrower
agrees, to the fullest extent it may effectively do so under applicable law,
that any holder of a participation in any amount outstanding under this
Agreement, whether or not acquired pursuant to the foregoing arrangements, may
exercise rights of setoff or counterclaim and other rights with respect to such
participation as fully as if such holder of a participation were a direct
creditor of the Borrower in the amount of such participation.

Amendments and Waivers

.  

49

NY:791404.13                                                                                                                                                                                         

Except as otherwise provided
in Section 9.19, any provision of this Agreement or any other Loan
Documents may be amended or waived if, but only if, such amendment or waiver is
in writing and is consented to by the Borrower, the Guarantor and the Required
Banks (or by the Administrative Agent with the consent of the Required Banks)
and, if the rights or duties of the Administrative Agent are affected thereby,
by the Administrative Agent; provided that, no such amendment or waiver
shall, unless consented to by all Banks directly affected thereby (or by the
Administrative Agent with the consent of such Banks), (i) change the
Commitments of any Bank or subject any Bank to any additional obligation,
(ii) change the principal of or decrease the rate of interest on any Loan
or decrease any fees (other than fees payable to the Administrative Agent)
hereunder, (iii) extend the date fixed for any payment of principal of or
interest on any Loan or any fees hereunder, (iv) change the amount of
principal, interest or fees due on any date fixed for the payment thereof,
(v) change the percentage of the Commitments or of the aggregate unpaid
principal amount of the Loans, or the number of Banks, which shall be required
for the Banks or any of them to take any action under this Section or any other
provision of this Agreement, (vi) change the manner of application of any
payments made under this Agreement, (vii) release or substitute all or any
substantial part of the collateral (if any) held as security for the Loans,
(viii) release the Guarantor from its obligations under Article X
hereof or any other Guarantee (if any) given to support payment of the Loans or
(ix) modify the definition of "Alternative Currency".

The Borrower will not
solicit, request or negotiate for or with respect to any proposed waiver or
amendment of any of the provisions of this Agreement unless each Bank shall be
informed thereof by the Borrower (through the Administrative Agent) and shall
be afforded an opportunity of considering the same and shall be supplied by the
Borrower (through the Administrative Agent) with sufficient information to
enable it to make an informed decision with respect thereto.  Executed or true
and correct copies of any waiver or consent effected pursuant to the provisions
of this Agreement shall be delivered by the Administrative Agent to each Bank
promptly following the date on which the same shall have been executed and
delivered by the requisite percentage of Banks.  The Borrower will not,
directly or indirectly, pay or cause to be paid any remuneration, whether by
way of supplemental or additional interest, fee or otherwise, to any Bank (in
its capacity as such) as consideration for or as an inducement to the entering
into by such Bank of any waiver or amendment of any of the terms and provisions
of this Agreement unless such remuneration is concurrently paid, on the same
terms, ratably to each of the Banks consenting to or entering into any such
waiver or amendment.

Successors and Assigns

. 

The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereunder; provided that
the Borrower and the Guarantor may not assign or otherwise transfer any of its
respective rights under this Agreement without the prior written consent of
each of the Banks (which consent shall not be unreasonably withheld or
delayed).

Any Bank may at any time sell
to one or more Persons (each a "Participant") participating interests in
any Loan owing to such Bank, its Commitment hereunder or any other interest of
such Bank hereunder.  In the event of any such sale by a Bank of a
participating interest to a Participant, such Bank's obligations under this
Agreement shall remain unchanged, such Bank shall remain solely responsible for
the performance thereof, and the Borrower and the Administrative Agent shall
continue to deal solely and directly with such Bank in connection with such
Bank's rights and obligations under this Agreement.  In no event shall a Bank
that sells a participation be obligated to the Participant to take or refrain
from taking any action hereunder except that such Bank may agree that it will
not (except as provided below), without the consent of the Participant, agree
to (i) extend any date fixed for the payment of principal of or interest on the
related loan or loans, (ii) the change of the amount of any principal, interest
or fees due on any date fixed for the payment thereof with respect to the
related loan or loans, (iii) the change of the principal of the related loan or
loans, (iv) any decrease in the rate at which either interest is payable
thereon or (if the Participant is entitled to any part thereof) commitment fee
is payable hereunder from the rate at which the Participant is entitled to
receive interest or commitment fee (as the case may be) in respect of such
participation, (v) the release or substitution of all or any substantial part
of the collateral (if any) held as security for the Loans, or (vi) release the
Guarantor from its obligations under Article X hereof or release
any other Guarantee (if any) given to support payment of the Loans.  The
Borrower agrees that each Participant shall be entitled to the benefits of Article
VIII with respect to its participation in Loans outstanding from time to
time; provided that (x) a Participant shall not be entitled to receive
any greater payment under Section 8.05 than the applicable Bank would
have been entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is made
with the Borrower's prior written consent and (y) a Participant that would be a
Foreign Bank if it were a Bank shall not be entitled to the benefits of Section
8.05 unless the Borrower is notified of the participation sold to such
Participant and such Participant agrees, for the benefit of the Borrower and
the Administrative Agent, to comply with Section 8.05(e) and (f)
as though it were a Bank.  Each Bank agrees that, upon the request of the
Borrower, such Bank shall disclose to the Borrower any participating interests
sold by such Bank since the Closing Date.

50

NY:791404.13                                                                                                                                                                                         

Any Bank may at any time assign
to one or more banks or financial institutions (each an "Assignee") all,
or a proportionate part of all, of its rights and obligations under this
Agreement, and such Assignee shall assume all such rights and obligations,
pursuant to an Assignment and Acceptance in the form attached hereto as Exhibit
C, executed by such Assignee and such transferor Bank and the
Administrative Agent; provided that (i) no interest may be sold by a Bank
pursuant to this paragraph (c) unless the Assignee shall agree to assume
ratably equivalent portions of the transferor Bank's Commitment; (ii) except in
the case of an assignment of the entire remaining amount of the assigning
Bank's Commitment and the Loans at the time owing to it or in the case of an
assignment to a Bank or an Affiliate of a Bank, the amount of the Commitment of
the assigning Bank subject to such assignment (determined as of the effective
date of the assignment) shall be equal to €25,000,000 (or any larger multiple
of €5,000,000); and (iii) no interest may be sold by a Bank pursuant to this
paragraph (c) to any Assignee that is not then a Bank without the consent of
the (A) Administrative Agent and
(B) so long as no Default or Event of Default has occurred and is continuing,
the Borrower, such consents shall not be unreasonably withheld or delayed.  The
Borrower may not withhold its consent solely because the assignment or transfer
might increase the Mandatory Cost.  Each Bank agrees to notify the
Administrative Agent who will notify the other Banks of any assignment
hereunder.  Upon (A) execution of the Assignment and Acceptance by such
transferor Bank, such Assignee, the Administrative Agent (if applicable) and
the Borrower (if applicable), (B) delivery of an executed copy of the
Assignment and Acceptance to the Borrower and the Administrative Agent, (C)
payment and delivery by the transferor Bank or the Assignee to the
Administrative Agent of a €2,500 processing and recordation fee for each such
Assignment to an Assignee and (D) payment by such Assignee to such transferor
Bank of an amount equal to the purchase price agreed between such transferor
Bank and such Assignee, such Assignee shall for all purposes be a Bank party to
this Agreement and shall have all the rights and obligations of a Bank under
this Agreement to the same extent as if it were an original party hereto with a
Commitment as set forth in such instrument of assumption, and the transferor
Bank shall be released from its obligations hereunder to a corresponding
extent, and no further consent or action by the Borrower, the Banks or the
Administrative Agent shall be required.  Any
assignment or transfer by a Bank of rights or obligations under this Agreement
that does not comply with this paragraph shall be treated for purposes of this
Agreement as a sale by such Bank of a participation in such rights and obligations
in accordance with paragraph (b) of this Section.  If (i) a
Bank assigns or transfers any of its rights or obligations under the Loan
Documents or changes its Lending Office; and (ii) as a result of circumstances
existing at the date the assignment, transfer or change occurs, the Borrower would
be obliged to make a payment to the Assignee or Bank acting through its new
Lending Office under Section 8.05(a) (Taxes; Payments Free
of Taxes) or the Borrower or an Additional Borrower would be required to
pay more Mandatory Costs than payable previously, then the Assignee or Lender acting through its new Lending Office is
only entitled to receive payment under Section 8.05(a) or Mandatory Costs to the same extent as the
assigning Bank or Bank acting through its previous Lending Office would have
been if the assignment, transfer or change had not occurred.

The
Administrative Agent, acting solely for this purpose as an agent of the
Borrower, shall maintain at one of its offices in Brussels, Belgium, a copy of
each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Banks, and the Commitments of,
and principal amounts of the Loans owing to, each Bank pursuant to the terms
hereof from time to time (the "Register").  The entries in the Register
shall be conclusive, and the Borrower, the Administrative Agent and the Banks
may treat each Person whose name is recorded in the Register pursuant to the
terms hereof as a Bank hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary.  The Register shall be available for
inspection by the Borrower and any Bank, at any reasonable time and from time
to time upon reasonable prior notice.  

Subject to the provisions of Section
9.09, the Borrower authorizes each Bank to disclose to any Participant,
Assignee or other transferee (each a "Transferee") and any prospective
Transferee any and all financial information in such Bank's possession
concerning the Borrower which has been delivered to such Bank by the Borrower
pursuant to this Agreement or which has been delivered to such Bank by the
Borrower in connection with such Bank's credit evaluation prior to entering
into this Agreement.

No Transferee shall be
entitled to receive any greater payment under Section 8.03 than the
transferor Bank would have been entitled to receive with respect to the rights
transferred, unless such transfer is made with the Borrower's prior written
consent or by reason of the provisions of Section 8.02 or 8.03
requiring such Bank to designate a different Lending Office under certain
circumstances or at a time when the circumstances giving rise to such greater
payment did not exist.

51

NY:791404.13                                                                                                                                                                                         

Any
Bank may at any time pledge or assign a security interest in all or any portion
of its rights under this Agreement to secure obligations of such Bank; provided
that no such pledge or assignment shall release such Bank from any of its
obligations hereunder or substitute any such pledgee or assignee for such Bank
as a party hereto.

Confidentiality

.  Each of the Administrative
Agent and the Banks agrees to maintain the confidentiality of the Information
(as defined below), except that Information may be disclosed (a) to its and its
Affiliates' directors, officers, employees and agents, including accountants,
legal counsel and other advisors (it being understood that the Persons to whom
such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to the
extent required to be disclosed to, any rating
agency, or regulatory or similar authority (including any
self-regulatory authority), (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (d) to any other party
hereto, (e) in connection with the exercise of any remedies under this
Agreement or under any other Loan Document (or any
hedging agreement with a Bank or the Administrative Agent) or any legal
or regulatory action or proceeding relating to this Agreement or any other Loan
Document (or any hedging agreement with a Bank or the
Administrative Agent) or the enforcement of rights hereunder or
thereunder, (f) subject to an agreement containing provisions substantially the
same as those of this Section, to (i) any purchasing
Bank, proposed purchasing Bank, Participant or proposed Participant, or
(ii) any actual or prospective counterparty (or its advisors) to any swap or
derivative transaction relating to the Borrower and its obligations, (g) with
the consent of the Borrower, (h) to Gold Sheets
and other similar bank trade publications, such information to consist solely
of deal terms and other information customarily found in such publications, (i)
to the extent such Information (x) becomes publicly available other than as a
result of a breach of this Section or (y) becomes available to the
Administrative Agent or any Bank on a nonconfidential basis from a source other
than the Borrower or (j) to governmental regulatory authorities in connection
with any regulatory examination of the Administrative Agent or any Bank or in
accordance with the Administrative Agent's or any Bank's regulatory compliance
policy if the Administrative Agent or such Bank deems necessary for the
mitigation of claims by those authorities against the Administrative Agent or
such Bank or any of its subsidiaries or affiliates.  For purposes of this
Section, "Information" means all information received from or at the
direction of the Borrower or any of its Subsidiaries relating to the Borrower
or any of its Subsidiaries or any of their respective businesses, other than
any such information that is available to the Administrative Agent or any Bank
on a nonconfidential basis prior to disclosure by the Borrower or any of its
Subsidiaries.  Any Person required to maintain the confidentiality of
Information as provided in this Section shall be considered to have complied
with its obligation to do so if such Person has exercised the same degree of
care to maintain the confidentiality of such Information as such Person would
accord to its own confidential information.

Representation by Banks

.  Each Bank hereby
represents that it is a commercial lender or financial institution which makes
loans in the ordinary course of its business and that it will make its Loans
hereunder for its own account in the ordinary course of such business.

Obligations Several

.  The obligations of each
Bank hereunder are several, and no Bank shall be responsible for the
obligations or commitment of any other Bank hereunder.  Nothing contained in
this Agreement and no action taken by Banks pursuant hereto shall be deemed to
constitute the Banks to be a partnership, an association, a joint venture or
any other kind of entity.  The amounts payable at any time hereunder to each
Bank shall be a separate and independent debt, and each Bank shall be entitled
to protect and enforce its rights arising out of this Agreement or any other
Loan Document, subject to any restrictions requiring actions to be taken upon
the consent of the Required Banks, and it shall not be necessary for any other
Bank to be joined as an additional party in any proceeding for such purpose.

Governing Law

.  This Agreement shall be
construed in accordance with and governed by English law.

Interpretation

.  No provision of this
Agreement or any of the other Loan Documents shall be construed against or
interpreted to the disadvantage of any party hereto by any court or other
governmental or judicial authority by reason of such party having or being
deemed to have structured or dictated such provision.

CONSENT TO JURISDICTION

52

NY:791404.13                                                                                                                                                                                         

.  TO THE FULLEST EXTENT
PERMITTED BY LAW, EACH OF THE PARTIES HERETO SUBMITS TO THE NONEXCLUSIVE
PERSONAL JURISDICTION OF THE COURTS OF ENGLAND AND WALES, FOR THE ENFORCEMENT
OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.

Judgment
Currency

.  The obligation of the
Borrower to pay the obligations under this Agreement and the other Loan
Documents and the obligation of the Borrower to make payments of any other
amounts payable hereunder or pursuant to any other Loan Document in the
currency specified for such payment shall not be discharged or satisfied by any
tender, or any recovery pursuant to any judgment, which is expressed in or
converted into any other currency, except to the extent that such tender or
recovery shall result in the actual receipt by each of the Administrative
Agent, the Issuer and the Banks of the full amount of the particular Permitted
Currency expressed to be payable pursuant to the applicable Loan Document.  The
Administrative Agent shall, using all amounts obtained or received from the
Borrower pursuant to any such tender or recovery in payment of principal of and
interest on the obligations under this Agreement and the other Loan Documents,
promptly purchase the applicable currency at the most favorable spot exchange
rate determined by the Administrative Agent to be available to it.  The
obligation of the Borrower to make payments in the applicable currency shall be
enforceable as an alternative or additional cause of action solely for the
purpose of recovering in the applicable currency the amount, if any, by which
such actual receipt shall fall short of the full amount of the currency
expressed to be payable pursuant to the applicable Loan Document.

Counterparts

.  This Agreement may be
signed in any number of counterparts, each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon the same
instrument.

Reversal of Payments

.  To the extent the Borrower
makes a payment or payments to the Administrative Agent for the ratable benefit
of the Banks or the Administrative Agent receives any payment or proceeds of
the collateral which payments or proceeds or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside and/or
required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, state or federal law, common law or equitable cause, then, to
the extent of such payment or proceeds repaid, the Loans or part thereof or
other obligation intended to be satisfied shall be revived and continued in
full force and effect as if such payment or proceeds had not been received by
the Administrative Agent.

Survival of Indemnities

.  Notwithstanding any
termination of this Agreement, the indemnities to which the Administrative
Agent and the Banks are entitled under the provisions of this Article IX
and any other provision of this Agreement and the other Loan Documents shall
continue in full force and effect and shall protect the Administrative Agent
and the Banks against events arising after such termination as well as before.

Integration

.  This Agreement, together with the other Loan Documents,
comprises the complete and integrated agreement of the parties on the subject
matter hereof and thereof and supersedes all prior agreements, written or oral,
on such subject matter.  In the event of any conflict between the provisions of
this Agreement and those of any other Loan Document, the provisions of this
Agreement shall control; provided that the inclusion of supplemental
rights or remedies in favor of the Administrative Agent or the Banks in any
other Loan Document shall not be deemed a conflict with this Agreement.  Each
Loan Document was drafted with the joint participation of the respective
parties thereto and shall be construed neither against nor in favor of any
party, but rather in accordance with the fair meaning thereof.

Mohawk Credit Agreement
Provisions

.  

53

NY:791404.13                                                                                                                                                                                         

                (a)           Notwithstanding any other provision of any Loan
Document to the contrary except for the immediately
following subsection (b), the Borrower, the Guarantor, the
Administrative Agent and the Banks hereby agree that as long as the Mohawk
Credit Agreement remains in effect, if any term, covenant or condition
contained in the Mohawk Credit Agreement or any other Loan Document (as defined
in the Mohawk Credit Agreement) is amended or waived in accordance with, or
otherwise in a manner effective under, the Mohawk Credit Agreement and such
term, covenant or condition is also contained in this Agreement or any other
Loan Document, then such term, covenant or condition contained in this
Agreement or any other Loan Document shall be deemed amended or waived, as
applicable, to the same extent amended or waived under the Mohawk Credit Agreement
effective hereunder when such amendment or waiver becomes effective thereunder,
automatically and without any action necessary by the Borrower, the Guarantor,
the Administrative Agent or the Banks.  Not in limitation of the preceding
sentence, the waiver of a Mohawk Credit Agreement Default in accordance with,
or otherwise effective under, the Mohawk Credit Agreement, shall be deemed to
be a waiver of any Default or Event of Default resulting from the events or
circumstances that gave rise to such Mohawk Credit Agreement Default.  The
Borrower agrees to provide the Administrative Agent and each Bank with a copy
of such amendment or waiver.  

                (b)           The
provisions of the immediately preceding subsection (a) shall not apply to
(i) any amendment to, or waiver of, Section 5.09(a) (Consolidation,
Mergers, Sales of Assets and Dissolution) or Section 6.01(a) (Events
of Default); or (ii) any amendment or waiver that would result in the
occurrence of any of the events referred to in the first proviso of
Section 9.06(a) (Amendments and Waivers).

USA
Patriot Act. 

The Administrative Agent and
each Bank hereby notifies the Borrower that pursuant to the requirements of the
USA Patriot Act, it is required to obtain, verify and record information that
identifies the Borrower, which information includes the name and address of the
Borrower and other information that will allow such Bank to identify the
Borrower in accordance with the USA Patriot Act.

Additional
Borrowers.

                (a)           Subject
to compliance with the provisions of paragraphs (c) and (d) of Clause 5.19 ("Know
your customer" checks), the Borrower may request that any of its
Subsidiaries becomes an Additional Borrower.  

                (b)           The
Administrative Agent shall use its best efforts to determine to the best of its
knowledge and, without affecting the obligations of the Borrower, shall within
a reasonable time provide notice to the Borrower if the addition of a
Subsidiary as an Additional Borrower will subject payments by the Additional
Borrower to reduction or withholding in accordance with Section 8.05(a)
(Taxes; Payments Free of Taxes) or result in Mandatory Costs in
accordance with Section 2.06 (Interest Rates).  Upon receipt of
such notice and acceptance by the Borrower, that Subsidiary shall become an
Additional Borrower if:

Where the Subsidiary is not a
Wholly Owned Subsidiary, all the Banks approve the addition of that Subsidiary,
such consent not to be unreasonably withheld;

the Borrower delivers to the
Administrative Agent a duly completed and executed Accession Letter; 

the Borrower confirms that no
Default is continuing or would occur as a result of that Subsidiary becoming an
Additional Borrower; and

the Administrative Agent has
received all of the documents and other evidence listed in Schedule 9.21
(Conditions Precedent Required To Be Delivered By An Additional Borrower)
in relation to that Additional Borrower, each in form and substance reasonably
satisfactory to the Administrative Agent.

                (c)           The
Administrative Agent shall notify the Borrower and the Banks promptly upon
being satisfied that it has received (in form and substance reasonably
satisfactory to it) all the documents and other evidence listed in Schedule
9.21 (Conditions Precedent Required To Be Delivered By An Additional
Borrower).

                (d)           Each
Additional Borrower hereby appoints the Borrower (the "Borrower
Representative") to act as its exclusive agent for all purposes under the
Loan Documents (including, without limitation, with respect to all matters
related to the borrowing and repayment of Loans as described in Article II). 
Each Additional Borrower acknowledges and agrees that (a) the Borrower
Representative may execute such documents on behalf of such Additional Borrower
as the Borrower Representative deems appropriate in its sole discretion and
such Additional Borrower shall be bound by and obligated by all of the terms of
any such document executed by the Borrower Representative on its behalf, and
(b) the Administrative Agent and each of the Banks shall accept (and shall be
permitted to rely on) any document or agreement executed by the Borrower
Representative on behalf of such Additional Borrower.

54

NY:791404.13                                                                                                                                                                                         

Service of process

                (a)           The
Borrower and Guarantor irrevocably appoint Everett Collins & Loosely, ECL
House, Lake Street, Leighton Buzzard, Bedfordshire, LU7 1RT, as its agent under
the Loan Documents for service of process in any proceedings before the English
courts in connection with any Loan Document. 

                (b)           If
any person appointed as process agent under this Section is unable for any
reason to so act, the Borrower and Guarantor shall promptly (and in any event
within 10 days of such event taking place) appoint another agent.  Failing
this, the Administrative Agent may appoint another process agent for this
purpose.

                (c)           The
Borrower and Guarantor agree that failure by a process agent to notify it of
any process will not invalidate the relevant proceedings.

This Section does not affect
any other method of service allowed by law.

Severability. 

If a term of a Loan Document
is or becomes illegal, invalid or unenforceable in any respect under any
jurisdiction in relation to any party to that Loan Document, that will not
affect:

(a)           in respect of
such party the legality, validity or enforceability in that jurisdiction of any
other term of the Loan Documents;

(b)           in respect of
any other party to such Loan Document the legality, validity or enforceability
in that jurisdiction of that or any other term of the Loan Documents; or

(c)           in respect of
any party to such Loan Document the legality, validity or enforceability in other
jurisdictions of that or any other term of the Loan Documents.

GUARANTY AND INDEMNIFICATION

Guaranty
and Indemnification

.  To induce the Banks to enter into this Agreement,
the Guarantor, for value received, hereby irrevocably and unconditionally guaranties
the due and punctual payment and performance when due, whether at stated
maturity, by acceleration or otherwise, of (i) all indebtedness and obligations
owing by the Borrower to the Administrative Agent, the Issuer and the Banks
under or in connection with this Agreement and any other Loan Document,
including without limitation, the repayment of all principal of the Loans and
all Reimbursement Obligations, and the payment of all interest, fees, charges,
attorneys fees and other amounts payable to the Administrative Agent, the
Issuer and the Banks hereunder or thereunder or in connection therewith; and
(ii) all amounts in respect of the foregoing (including, but not limited to,
post-petition interest) which would become due but for the operation of the
automatic stay under section 362(a) of the United States Bankruptcy Code of
1978 or other applicable bankruptcy, insolvency or similar law ((i) and (ii)
collectively referred to as  (the "Guarantied Obligations").  The
Guarantor, for value received, hereby indemnifies each Bank immediately on
demand against any loss or liability suffered by that Bank if any obligation
expressed to be guaranteed by it is or becomes unenforceable, invalid or
illegal; the amount of the loss or liability under this indemnity will be equal
to the amount the Bank would otherwise have been entitled to recover.  

Guaranty
of Payment and Not of Collection

55

NY:791404.13                                                                                                                                                                                         

.  The guaranty by the Guarantor under this Article is
a guaranty of payment, and not of collection, and a debt of the Guarantor for
its own account.  Accordingly, none of Administrative Agent, the Issuer or the
Banks shall be obligated or required before enforcing the obligations of the
Guarantor under this Article against the Guarantor: (a) to pursue any
right or remedy any of them may have against the Borrower or any other Person
or commence any suit or other proceeding against the Borrower or any other
Person in any court or other tribunal; (b) to make any claim in a
liquidation or bankruptcy of the Borrower or any other Person; or (c) to
make demand of the Borrower or any other Person or to enforce or seek to
enforce or realize upon any collateral security held by the Administrative
Agent, the Issuer or any of the Banks which may secure any of the Guarantied
Obligations.  

Guaranty
Absolute

.  The Guarantor guarantees that the Guarantied
Obligations will be paid strictly in accordance with the terms of the documents
evidencing the same, regardless of any applicable law now or hereafter in
effect in any jurisdiction affecting any of such terms or the rights of the
Administrative Agent, the Issuer and the Banks with respect thereto.  The
obligations of the Guarantor under this Article shall be absolute and
unconditional in accordance with their terms and shall remain in full force and
effect without regard to, and shall not be released, suspended, discharged,
terminated or otherwise affected by, any circumstance or occurrence whatsoever.

Waiver

.  The Guarantor, to the fullest extent permitted by
applicable law, hereby irrevocably and unconditionally waives acceptance of (i)
notice of any presentment, demand, protest or notice of any kind, and any other
act or thing, or omission or delay to do any other act or thing, and (ii) any
offset or counterclaim or other right, defense or claim relating to any
obligation now or later owed to the Guarantor for the Borrower or the Banks;
each of which in any manner or to any extent might vary the risk of the
Guarantor or which otherwise might operate to discharge the Guarantor from its
obligations under this Article.

Inability
to Accelerate

.  If the Administrative Agent, the Issuer or any of
the Banks is prevented from demanding or accelerating payment of any of the
Guarantied Obligations by reason of any automatic stay or otherwise,
Administrative Agent, the Issuer or such Bank, as the case may be, shall be
entitled to receive from the Guarantor, upon demand therefor, the sums which
otherwise would have been due had such demand or acceleration occurred.

Reinstatement
of Guarantied Obligations

.  If claim is ever made on the Administrative Agent,
the Issuer or any of the Banks for repayment or recovery of any amount or
amounts received in payment or on account of any of the Guarantied Obligations,
and the Administrative Agent, the Issuer or such Bank repays all or part of
said amount by reason of (a) any judgment, decree or order of any court or
administrative body of competent jurisdiction, or (b) any settlement or
compromise of any such claim effected by the Administrative Agent, the Issuer
or such Bank with any such claimant (including the Borrower or a trustee in
bankruptcy for the Borrower), then and in such event the Guarantor agrees that
any such judgment, decree, order, settlement or compromise shall be binding on
it, notwithstanding any revocation of any of the Guarantor's obligations under
this Article or the cancellation of any of the Loan Documents, or any other
instrument evidencing any liability of the Borrower, and the Guarantor shall be
and remain liable to the Administrative Agent, the Issuer or such Bank for the
amounts so repaid or recovered to the same extent as if such amount had never
originally been paid to the Administrative Agent, the Issuer or such Bank.

Subrogation

.  The Guarantor shall not enforce any right or receive
any payment by way of subrogation or otherwise take any action in respect of
any other claim or cause of action the Guarantor may have against the Borrower
arising by reason of any payment or performance by the Guarantor pursuant to
this Article, unless and until all of the Guarantied Obligations have been
irrevocably and indefeasibly paid and performed in full, including, without
limitation (i) any right of contribution or indemnity; (ii) claim, rank, prove
or vote as a creditor of the Borrower or its estate; or (iii) receive, claim or
have the benefit of any payment, distribution or security from or on account of
the Borrower, or exercise any right of set-off as against the Borrower, in each
case.  If any amount shall be paid to the Guarantor in violation of the
preceding sentence, such amount shall be held by the Administrative Agent for
the benefit of the Banks and shall forthwith be paid to the Banks to be
credited and applied to the Guarantied Obligations, whether matured or
unmatured.  Subject to the foregoing, upon payment in full of all of the
Guarantied Obligations, the Guarantor shall be subrogated to the rights of the
payee against the Borrower and the Banks agree to take at the Guarantor's
expense such steps as the Guarantor may reasonably request to implement such
subrogation.

Expenses

.  The Guarantor agrees to pay on demand all reasonable
out-of-pocket expenses (including without limitation the reasonable fees and
disbursements of the Administrative Agent and the Banks' counsel) incurred in
the enforcement or protection of the rights of the Banks hereunder; provided
that the Guarantor shall not be liable for any expenses of the Banks hereunder
if no payment under this Guaranty is due.

Cumulative
Rights

56

NY:791404.13                                                                                                                                                                                         

.  No failure on the part of the Banks to exercise, and
no delay in exercising, any right, remedy or power hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise by the Banks of any
right, remedy or power hereunder preclude any other or future exercise of any
right, remedy or power.  Each and every right, remedy and power hereby granted
to the Beneficiary or allowed it by law or other agreement shall be cumulative
and not exclusive of any other, and may be exercised by the Banks from time to
time.

Nature
of Rights

.  Each
default in the payment of any of the Guarantied Obligations shall give rise to
a separate claim and cause of action hereunder, and separate claims or suits
may be made and brought, as the case may be, hereunder as each such default
occurs. 

None of the obligations
of the Guarantor hereunder shall be affected or impaired by any waiver by the
Banks of the performance or observance by the Borrower of any of the
agreements, covenants, terms or conditions contained in this Agreement, or any
indulgence in or the extension of the time for payment by the Borrower of any
amounts payable under or in connection with this Agreement or of the time for
performance by the Borrower of any other obligations under or arising out of
this Agreement or the extension or renewal thereof, or the modification or
amendment (whether material or otherwise) of any duty, agreement or obligation
of the Borrower set forth in this Agreement or the voluntary or involuntary
liquidation, sale or other disposition of all or substantially all the assets
of the Borrower, or receivership, insolvency, bankruptcy, reorganization, or
other similar proceedings affecting the Borrower or any of its respective
assets, or the consolidation or merger of any obligor, any set-off or
counterclaim that the Banks may have against the Borrower, or any amendment,
waiver or release of any other collateral, guarantee or other security in
respect of this Agreement, or to the fullest extent permitted under applicable
law, any other cause or circumstance, whether similar or dissimilar to the
foregoing which might otherwise constitute a legal or equitable defence
available to, or discharge of, the Guarantor.  

The obligations of
the Guarantor hereunder are primary, absolute, irrevocable and unconditional. 
This Guaranty is continuing in nature, shall be effective with respect to the
full amount of all Guarantied Obligations, now existing or hereafter arising or
extended, and shall remain in full force and effect and be binding upon the
Guarantor, until the payment in full of the Guarantied Obligations.  In the
event that any payment by the Borrower in respect of any Guarantied Obligations
is rescinded, avoided or must otherwise be restored or returned for any reason
whatsoever, the guaranty by the Guarantor
under this Article shall continue to be effective or will be reinstated, if
necessary, and the Guarantor shall remain liable hereunder in respect of such
Guarantied Obligations, in each case as if such payment had not been made.

[Signature Pages Follow] 57

NY:791404.13                                                                                                                                                                                         

IN WITNESS WHEREOF, the
parties hereto have caused this Five Year Credit Agreement to be duly executed,
under seal, by their respective authorized officers as of the day and year
first above written.

MOHAWK INTERNATIONAL HOLDINGS

S.À R.L., as Borrower

By: /s/: Scott Veldman  

Name: Scott Veldman  

Title: Vice President & Treasurer  

[Signature Pages Continue]

[Five Year Credit Agreement - Unilin]

NY:791404.13

[Signature Page to Five
Year Credit Agreement for Mohawk International Holdings S.à r.l]

MOHAWK INDUSTRIES, INC., as
Guarantor

By: /s/: Scott Veldman  

Name: Scott Veldman

Title: Vice President & Treasurer

[Signature Pages Continue]

[Five Year Credit Agreement - Unilin]

NY:791404.13

[Signature Page to Five
Year Credit Agreement for Mohawk International Holdings S.à r.l]

KBC BANK
NV, as Administrative Agent, the Issuer
and a Bank

By: /s/: Dirk Witters

Name: Dirk Witters

Title:  Global Relationship Manager, Multinationals

[Signature Pages Continue]

[Five Year Credit Agreement - Unilin]

NY:791404.13

[Signature Page to Five
Year Credit Agreement for Mohawk International Holdings S.à r.l]

ING Luxembourg SA, as a
Bank

By: /s/ Yves Verhuldt

Name: Yves Verhuldt

Title: Sous-Directeur

[Five Year Credit Agreement - Unilin]

NY:791404.13

Exhibit A

Opinion
of Counsel for the 

Administrative
Agent on behalf of the Banks 

To be dated as of the Closing
Date and in the form attached hereto. NY:791404.13

Exhibit B

OPINION OF

COUNSEL FOR THE BORROWER

To be dated as of the Closing
Date and in the form attached hereto.

NY:791404.13

Exhibit C

ASSIGNMENT AND ACCEPTANCE

Dated __________ ___,
________

Reference is made to the Five
Year Credit Agreement dated as of ______ __, 2005 (together with all amendments
or modifications thereto, the "Credit Agreement") by and among Mohawk
International Holdings S.à r.l., a corporation organized under the laws of the
Grand Duchy of Luxembourg (the "Borrower"), KBC Bank NV, as
Administrative Agent and the other banks from time to time party thereto
(collectively, the "Banks").  Terms defined in the Credit Agreement are
used herein with the same meaning.

_____________________ (the "Assignor")
and ____________ (the "Assignee") agree as follows:

The Assignor hereby sells and
assigns to the Assignee, and the Assignee hereby purchases and assumes from the
Assignor, a _____% interest in and to all of the Assignor's rights and
obligations under the Credit Agreement as of the Closing Date (as defined
below) (including, without limitation, a ____% interest (which on the Closing
Date hereof is €____________) in the aggregate principal amount of the
Assignor's Commitment).

The Assignor (i) makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with the
Credit Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Agreement or any other Loan
Documents furnished pursuant thereto, other than that it is the legal and
beneficial owner of the interest being assigned by it hereunder, that such
interest is free and clear of any adverse claim and that as of the date hereof
the aggregate principal amount of the Assignor's Commitments (without giving
effect to assignments thereof which have not yet become effective) is
€____________ and the aggregate outstanding principal amount of all Loans owing
to it (without giving effect to assignments thereof which have not yet become
effective) is €____________; and (ii) makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrower or the performance or observance by the Borrower of any of its
obligations under the Credit Agreement or any other instrument or document
furnished pursuant thereto.

The Assignee (i) confirms
that it has received a copy of the Credit Agreement, together with copies of
the financial statements referred to in Section 4.04(a) thereof (or any
more recent financial statements of the Borrower delivered pursuant to Section
5.01(a) or (b) thereof) and such other documents and information as
it has deemed appropriate to make its own credit analysis and decision to enter
into this Assignment and Acceptance; (ii) agrees that it will, independently
and without reliance upon the Assignor or any other Bank 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 Credit
Agreement; (iii) confirms that it is a bank or financial institution; (iv)
agrees that it will perform in accordance with their terms all of the
obligations which by the terms of the Credit Agreement are required to be
performed by it as a Bank; (v) specifies as its Lending Office (and address for
notices) the office set forth beneath its name on the signature pages hereof,
(vi) represents and warrants that the execution, delivery and performance of
this Assignment and Acceptance are within its corporate powers and have been
duly authorized by all necessary corporate action and (vii) attaches such
documents as are necessary to indicate that all payments to be made to the
Assignee under the Credit Agreement are not subject to withholding or other
similar taxes (or at a reduced rate as per an applicable tax treaty).

The Closing Date for this
Assignment and Acceptance shall be _______________ (the "Closing Date").

From and after the Closing
Date, (i) the Assignee shall be a party to the Credit Agreement and, to the
extent rights and obligations have been transferred to it by this Assignment
and Acceptance, have the rights and obligations of a Bank thereunder and (ii)
the Assignor shall, to the extent its rights and obligations have been
transferred to the Assignee by this Assignment and Acceptance, relinquish its rights
(other than under Section 9.04 of the Credit Agreement) and be released
from its obligations under the Credit Agreement.

NY:791404.13

From and after the Closing
Date, the Borrower shall make all payments in respect of the interest assigned
hereby to the Assignee.  The Assignor and Assignee shall make all appropriate
adjustments in payments for periods prior to such acceptance by the Borrower
directly between themselves.

This Assignment and
Acceptance shall be governed by, and construed in accordance with, the laws of
England.

[NAME OF ASSIGNOR]

By:          

Name:____________________________

Title: ____________________________

[NAME OF ASSIGNEE]

By:          

Name:____________________________

Title: ____________________________

Lending Office:

[Address]

CONSENTED AND AGREED TO:

MOHAWK INTERNATIONAL HOLDINGS
S.À R.L., as Borrower

By:          

Name:____________________________

Title: ____________________________

KBC BANK NV,

as Administrative Agent

By:          

Name:____________________________

Title: ______________________________

NY:791404.13

Exhibit D-1

NOTICE OF BORROWING

___________, _______

KBC
Bank NV, as Administrative Agent

                                                                

                                                                

                                                                

Attention: 
                                            

Re:          Five Year Credit
Agreement dated as of ____________, 2005 (as amended or modified from time to
time, the "Credit Agreement") by and among MOHAWK INTERNATIONAL HOLDINGS
S.À R.L., as Borrower, KBC BANK NV, as Administrative Agent, and the other
Banks from time to time party thereto.

Ladies and Gentlemen:

Unless otherwise defined
herein, capitalized terms used herein shall have the meanings attributable
thereto in the Credit Agreement.

This Notice of Borrowing is
delivered to you pursuant to Section 2.02 of the Credit Agreement.

The Borrower hereby requests
a Eurocurrency Borrowing in the aggregate principal amount of ________________
to be made on ______________, 20____[1],
and for interest to accrue thereon at the rate established by the Credit
Agreement for Eurocurrency Loans.  The duration of the Interest Period with
respect thereto shall be [1 month] [2 months] [3 months] [6 months] [12
months].  The Permitted Currency in which such Loan shall be made is
______________.

The proceeds of any borrowing
requested hereunder shall be made available to the Borrower by
______________________.

[Signature Page Follows] NY:791404.13

The Borrower has caused this
Notice of Borrowing to be executed and delivered by its duly authorized officer
this _________ day of ______________, 20____.

MOHAWK INTERNATIONAL HOLDINGS 

S.À R.L., as Borrower

By:          

Name:____________________________

Title: ____________________________

NY:791404.13

Exhibit D-2

NOTICE OF CONTINUATION 

_____________________, 20____

KBC
Bank NV, as Administrative Agent

                                                                

                                                                

                                                                

Attention: 
                                            

Re:          Five Year Credit
Agreement dated as of ____________, 2005 (as amended or modified from time to
time, the "Credit Agreement") by and among MOHAWK INTERNATIONAL HOLDINGS
S.À R.L., as Borrower, KBC BANK NV, as Administrative Agent, and the other
Banks from time to time party thereto.

Ladies and Gentlemen:

Unless otherwise defined
herein, capitalized terms used herein shall have the meanings attributable
thereto in the Credit Agreement.

This Notice of Continuation
is delivered to you pursuant to Section 2.03 of the Credit
Agreement.

With respect to the
Eurocurrency Loans denominated in ________________ in the aggregate amount of
___________ each of which has an Interest Period ending on _____________, the
Borrower hereby requests that such Loans be continued as Eurocurrency Loans in
the aggregate principal amount of __________ to be made on such date, and for
interest to accrue thereon at the rate established by the Credit Agreement. 
The duration of the Interest Period with respect thereto shall be
[1 month] [2 months] [3 months] [6 months] [12 months].

The Borrower has caused this
Notice of Continuation to be executed and delivered by its duly authorized
officer this ______ day of ____________, 20___.

MOHAWK INTERNATIONAL HOLDINGS
    S.À R.L., as Borrower

By: ________________________________

Name:_______________________________

Title:
_______________________________

NY:791404.13

Exhibit E

COMPLIANCE
CERTIFICATE

Reference is made to the Five
Year Credit Agreement dated as of ________ __, 2005 (as amended or modified
from time to time, the "Credit Agreement") by and among MOHAWK INTERNATIONAL HOLDINGS S.À R.L.,
as Borrower, KBC BANK NV, as Administrative Agent, and the other Banks from
time to time party thereto.

Pursuant to Section
5.01(c) of the Credit Agreement, ____________, the duly authorized
_____________________ of the Guarantor hereby certifies, on behalf of the
Guarantor, to the Banks that the information contained in the Compliance Check
List attached hereto is true, accurate and complete as of ____________, _____,
and that no Defaults or Events of Default exist.

By:
________________________________

Name:
______________________________

Title:
_______________________________

NY:791404.13

COMPLIANCE CHECK
LIST

(Mohawk
Industries, Inc.)

____________

____________,
_____

1. Debt to
Capitalization Ratio (Section 5.03)

The Debt to
Capitalization Ratio shall be less than or equal to 0.65 to 1.00 at the end of each
Fiscal Quarter; provided, that for any Fiscal Quarter ending on or after the
date that is 1 year following the closing date of the Unilin Acquisition and
for each Fiscal Quarter thereafter, the Debt to Capitalization shall be less
than or equal to 0.60 to 1.00 at the end of each Fiscal Quarter.

(a)           Consolidated
Debt                                                                                                                               $_______

(b)           Consolidated
Total Capital                                                                                                                 $_______

                Actual
Ratio of (a) to (b)                                                                                                     ________

                Maximum
Ratio                                                                     <0.65
to 1.00 or <0.60 to 1.00

                                                                                                                                                (as
applicable)

                Debt
Rating (most recent)                                                   ______
Moody's; _______ S&P

                Pricing
Level from Debt Rating                                                                          Level
________

                Applicable
Margin:

                Base
Rate:                                                                                                                                             ______%*[2]

                Eurocurrency:
                                                                                                                                      ______%*

                Facility
Fee                                                                                                                                            ______%*

                Utilization
Fee                                                                                                                       ______%*

2.             Negative
Pledge (Section 5.06) and Subsidiary Debt (Section 5.18):

                Liens
permitted under paragraphs (a) through (h) of Section 5.06                              $________

                Debt
of Subsidiaries incurred pursuant to paragraph (e) of

                Section
5.18                                                                                                                                           $________

                Total:
                                                                                                                                                     $________

                Limitation
- 15% of Consolidated Net Worth                                                               $________

NY:791404.13

3.             Calculations
with respect to Asset Securitizations:

                Outstanding
attributed principal amount under any

                Asset
Securitization                                                                                                                            $________

NY:791404.13

Exhibit F

Form
of Accession Letter

To:          KBC BANK NV, as Administrative Agent

From:      [Additional
Borrower] and [Borrower]

Dated:    

Dear Sirs

MOHAWK INTERNATIONAL HOLDINGS
S.À R.L. -Five Year Credit Agreement

dated as of
[        ], 2005 (the "Agreement")

We refer to the Agreement. 
This is an Accession Letter.  Terms defined in the Agreement have the same
meaning in this Accession Letter unless given a different meaning in this
Accession Letter.

[Additional Borrower]
agrees to become an Additional Borrower and to be bound by the terms of the Agreement
as an Additional Borrower pursuant to Clause 9.21 (Additional Borrowers)
of the Agreement.  [Additional Borrower] is a company duly incorporated
under the laws of [name of relevant jurisdiction]. 

[Additional Borrower's]
administrative details are as follows:

Address:                

Telephone No:

Telecopy No:        

Attention:              

This Accession Letter is
governed by English law.

[Additional Borrower],
as Additional Borrower

By:          

Name:     ______________________________

Title:       _______________________________

MOHAWK INTERNATIONAL HOLDINGS
    S.À R.L., as Borrower

By:          

Name:                                                  ______________________________

Title:                                       _______________________________NY:791404.13

Schedule 1.01(a)

Commitments and Lending
Offices

	
  BANK

  	
  COMMITMENT

  	
  LENDING OFFICE

  
	
  KBC
  Bank NV

  	
  €65,000,000

  	
  KBC Bank NV, Dublin Branch

  Sandwith Street,

  Dublin 2

  Ireland

  
	
  ING Luxembourg SA

  	
  €65,000,000

  	
  ING Luxembourg SA

  52, route d'Esch  L-2965
  Luxembourg

  Luxembourg

  
	

  	
   

  	
   

  
	

  	
   

  	
   

  
	

  	
   

  	
   

  
	

  	
   

  	
   

  

 

NY:791404.13

 

Schedule 2.06

Calculation of the Mandatory
Cost

General

The Mandatory Cost is to
compensate a Bank for the cost of compliance with the requirements of the
European Central Bank. 

The Mandatory Cost is
expressed as a percentage rate per annum.

The Mandatory Cost is the
weighted average (weighted in proportion to the percentage share of each Bank
in the relevant Loan) of the rates for the Banks calculated by the
Administrative Agent in accordance with this Schedule.

The Administrative Agent must
distribute each amount of Mandatory Cost among the Banks on the basis of the
amount of their respective Commitments.

Any determination by the
Administrative Agent pursuant to this Schedule will be, in the absence of
manifest error, conclusive and binding on all the parties hereto

Banks lending from a Lending
Office in a Participating Member State

The
relevant rate for a Bank lending from a Lending Office in a Participating
Member State is the percentage rate per annum notified by that Bank to the
Administrative Agent.  This percentage rate per annum must be certified by that
Bank in its notice to the Administrative Agent as its reasonable determination
of the cost (expressed as a percentage of that Bank's share in all Loans made
from that Lending Office) of complying with the minimum reserve requirements of
the European Central Bank in respect of Loans made from that Lending Office.

If a Bank fails to specify a
rate under paragraph 0 above, the Administrative Agent will assume that
the Bank has not incurred any such cost.

Banks
lending from a Lending Office in the U.K.

The relevant rate for a Bank
lending from a Lending Office in the U.K. is calculated in accordance with the
following formulae:

for a Loan in Sterling:

	
	

for any other Loan:

where on the day of
application of the formula:

A             is the
percentage of that Bank's eligible liabilities (in excess of any stated
minimum) which the Bank of England requires it to hold on a
non-interest-bearing deposit account in accordance with its cash ratio
requirements;

B             is the
percentage rate of EURIBOR for the relevant Interest Period;

NY:791404.13

C             is the
percentage (if any) of that Bank's eligible liabilities which the Bank of
England requires it to place as an interest-bearing special deposit;

D             is the
percentage rate per annum payable by the Bank of England on interest bearing
special deposits; and

E              is calculated
by the Administrative Agent as being the average of the rates of charge under
the fees rules supplied by the Reference Banks to the Administrative Agent
under paragraph 0 below and expressed in pounds per £1 million.

For the purposes of this
paragraph 0:

eligible liabilities and special deposit(s) have the meanings given
to them at the time of application of the formula pursuant to the Bank of
England Act 1998 or (as appropriate) by the Bank of England;

fees rules means the then current rules on periodic fees in the
Supervision Manual of the FSA Handbook or any other law or regulation as may
then be in force for the payment of fees for the acceptance of deposits;

fee tariffs means the fee tariffs specified in the fees rules
under fee-block Category A1 (Deposit acceptors) (ignoring any minimum fee or
zero rated fee required pursuant to the fees rules but applying any applicable
discount rate); and

tariff base has the meaning given to it in, and will be calculated
in accordance with, the fees rules.

In the application of the
formulae, A, B, C and D are included as figures and not as percentages, e.g. if
A = 0.5 per cent. and B = 15 per cent., AB is calculated as 0.5 x 15.  A
negative result obtained by subtracting D from B is taken as zero.

Each rate calculated in
accordance with a formula is, if necessary, rounded upward to four decimal
places.

If
requested by the Administrative Agent, each Reference Bank must, as soon as
practicable after publication by the Financial Services Authority, supply to
the Administrative Agent the rate of charge payable by that Reference Bank to
the Financial Services Authority under the fees rules for that financial year
of the Financial Services Authority (calculated by that Reference Bank as being
the average of the fee tariffs applicable to that Reference Bank for that
financial year) and expressed in pounds per £1 million of the tariff base of
that Reference Bank.

Each Bank must supply to the
Administrative Agent the information required by it to make a calculation of
the rate for that Bank.    In particular, each Bank must supply the following
information on or prior to the date on which it becomes a Bank:

the jurisdiction of its
Lending Office; and

any other information that
the Administrative Agent reasonably requires for that purpose.

Each Bank must promptly
notify the Administrative Agent of any change to the information supplied to it
under this paragraph.

The percentages of each Bank
for the purposes of A and C above and the rates of charge of each Reference
Bank for the purpose of E above are determined by the Administrative Agent
based upon the information supplied to it under paragraphs (d) and (e) above. 
Unless a Bank notifies the Administrative Agent to the contrary, the
Administrative Agent may assume that the Bank's obligations in respect of cash
ratio deposits and special deposits are the same as those of a typical bank
from its jurisdiction of incorporation with a Lending Office in the U.K.

The Administrative Agent has
no liability to any party to this Agreement if its calculation over or under
compensates any Bank.  The Administrative Agent is entitled to assume that the
information provided by any Bank or Reference Bank under this Schedule 2.06
is true and correct in all respects.

NY:791404.13

Banks lending from a Lending
Office in the U.S.

                The relevant
rate for the Bank if it is lending from a Lending Office in the U.S. is defined
to mean, for any day for which the formula applies, a fraction (expressed as a
decimal), the numerator of which is the number one and the denominator of which
is the number one minus the aggregate of the maximum reserve percentages on
that day established by the Fed (including those imposed by Regulation D of the
Fed as well as any marginal, special, emergency or supplemental reserves)
expressed as a decimal, to which the Bank is subject with respect to for
eurocurrency funding (currently referred to as "Eurocurrency Liabilities" in
Regulation D of the Fed).  Loans shall be deemed to constitute eurocurrency
funding and to be subject to the reserve requirements established by the Fed
without benefit of or credit for proration, exemptions or offsets that may be
available from time to time to the Bank under Regulation D or any comparable
regulation.

Changes

The Administrative Agent may,
after consultation with the Borrower, determine and notify all the parties
hereto of any amendment to this Schedule which is required to reflect:

any change in law or regulation;
or

any requirement imposed by
the European Central Bank (or, in any case, any successor authority).

NY:791404.13

Schedule 4.05

Litigation

None.

NY:791404.13

Schedule 4.08

Subsidiaries

NY:791404.13

 

	
   Name of Subsidiary

   	
   Jurisdiction of
   Formation

   	
   Holders of Equity
   Interest

   
	
  Mohawk Carpet Corporation

  	
  Delaware

  	
  Borrower

  
	
  World International, Inc.

  	
  Barbados

  	
  Mohawk Carpet Corporation

  
	
  Mohawk Servicing, Inc.

  	
  Delaware

  	
  Mohawk Carpet Corporation

  
	
  Mohawk Factoring, Inc.

  	
  Delaware

  	
  Mohawk Carpet Corporation
  (79.3%)

  World International, Inc.
  (20.7%)

  
	
  Aladdin Manufacturing
  Corporation

  	
  Delaware

  	
  Mohawk Carpet Corporation

  
	
  Mohawk International FSC,
  Inc.

  	
  Barbados

  	
  Mohawk Carpet Corporation

  
	
  Horizon Europe, Inc.

  	
  Georgia

  	
  Aladdin Manufacturing
  Corporation

  
	
  Mohawk Mills, Inc.

  	
  Delaware

  	
  Aladdin Manufacturing
  Corporation

  
	
  Mohawk Brands, Inc.

  	
  Delaware

  	
  Aladdin Manufacturing
  Corporation

  
	
  Mohawk Resources, Inc.

  	
  Delaware

  	
  Mohawk Carpet Corporation

  
	
  Mohawk Canada Corporation

  	
  Nova Scotia

  	
  Mohawk Carpet Corporation

  
	
  Aladdin of Texas Holdings,
  LLC

  	
  Delaware

  	
  Mohawk Mills, Inc.

  
	
  Mohawk Carpet Distribution,
  L.P.

  	
  Delaware

  	
  Mohawk Mills, Inc. (99%)

  Aladdin of Texas Holdings,
  LLC (1%)

  
	
  Mohawk Carpet
  Transportation of Georgia, LLC

  	
  Delaware

  	
  Mohawk Carpet Distribution,
  L.P.

  
	
  Dal-Tile International Inc.

  	
  Delaware

  	
  Borrower

  
	
  Dal-Tile Group Inc.

  	
  Delaware

  	
  Dal-Tile International Inc.

  
	
  Dal-Tile Corporation

  	
  Pennsylvania

  	
  Dal-Tile Group Inc.

  
	
  DTM/CM Holdings Inc.

  	
  Delaware

  	
  Dal-Tile Group Inc.

  
	
  Dal-Tile Canada Inc.

  	
  Ontario, Canada

  	
  Dal-Tile Group Inc.

  
	
  Dal-Tile Mexico
  S.A. de C.V.

  	
  Mexico

  	
  Dal-Tile Group Inc.
  (99.985%)

  DTM/CM Holdings Inc.
  (0.004%)

  Dal-Tile Corporation
  (0.011%)

  
	
  Dal-Tile Puerto
  Rico Inc.

  	
  Puerto Rico

  	
  Dal-Tile Corporation

  
	
  DTG Tile LLC.

  	
  Delaware

  	
  Dal-Tile Corporation

  
	
  DTL Tile LLC

  	
  Delaware

  	
  Dal-Tile Corporation

  
	
  Dal-Tile I LLC

  	
  Delaware

  	
  Dal-Tile Corporation

  
	
  Dal-Elite L.P.

  	
  Texas

  	
  DTL Tile Corp. (99%)

  DTG Tile Corp. (1%)

  
	
  Dal-Italia LLC (80%)

  	
  Delaware

  	
  Dal-Tile I LLC (80%)

  EMILAMERICA, Inc.
  (unrelated) (20%)

  
	
  Dal-Tile Services, Inc.

  	
  Delaware

  	
  Dal-Tile Corporation

  
	
  Dal-Tile SSC East, Inc.

  	
  Delaware

  	
  Dal-Tile Corporation

  
	
  Dal-Tile SSC West, Inc.

  	
  Delaware

  	
  Dal-Tile Corporation

  
	
  Mohawk ESV, Inc.

  	
  Delaware

  	
  Mohawk Carpet Corporation

  
	
  Aladdin Texas, LLC

  	
  Delaware

  	
  Mohawk Carpet Distribution,
  L.P.

  
	
  Lees Mohawk (UK)
  Limited UK

  	
  United Kingdom

  	
  Mohawk Carpet Corporation

  
	
  Mohawk Commercial, Inc.

  	
  Delaware

  	
  Mohawk Carpet Corporation

  
	
  Mohawk International
  Holdings S.à r.l.

  	
  Luxembourg

  	
  Mohawk Global Investments
  S.à r.l.

  
	
  Mohawk International
  (Europe) S.à r.l.

  	
  Luxembourg

  	
  Mohawk International
  Holdings S.à r.l.

  
	
  Unilin Flooring BVBA

  	
  Belgium

  	
  Mohawk International
  Holdings S.à r.l. 

  Mohawk International
  (Europe) S.à r.l. (1 share only)

  
	
  Unilin Holding NV

  	
  Belgium

  	
  Unilin Flooring BVBA

  Mohawk International
  (Europe) S.à r.l. (1 share only)

  
	
  Unilin Industries NV

  	
  Belgium

  	
  Unilin Holding NV (99.43%)

  Unilin Flooring BVBA
  (0.57%)

  
	
  Unilin IMMO NV

  	
  Belgium

  	
  Unilin Holding NV (99.9%)

  Unilin Industries NV (0.1%)

  
	
  Unilin Holding Inc.

  	
  North Carolina

  	
  Unilin Flooring BVBA

  
	
  Unilin Flooring NC LLC

  	
  North Carolina

  	
  Unilin Holding Inc.

  
	
  Fibrolin Partnership

  	
  Nevada

  	
  Unilin Flooring BVBA (99%)

  Unilin Industries NV (1%)

  
	
  Unifin Inc.

  	
  Delaware

  	
  Fibrolin Partnership

  

	

  Unilin NV

  	
  Belgium

  	
  Unilin Industries NV
  (99.9%)

  Unilin Holding NV (0.1%)

  
	
  Unilin Holding SAS

  	
  France

  	
  Unilin Décor NV (74%)

  Unilin NV (16%)

  Unilin Systems NV (10%)

  
	
  Unilin SAS

  	
  France

  	
  Unilin Holding SAS

  
	
  Unilin US MDF Branch

  	
  Belgium

  	
  Unilin Flooring BVBA
  (98.05%)

  Unilin NV (1.95%)

  
	
  Unilin Décor NV

  	
  Belgium

  	
  Unilin Industries NV
  (99.975%)

  Unilin NV (0.025%)

  
	
  Eurokit NV

  	
  Belgium

  	
  Unilin Décor NV (92%)

  Unilin Industries NV (8%)

  
	
  Unilin Systems NV

  	
  Belgium

  	
  Unilin Industries NV
  (99.9%)

  Unilin NV (0.01%)

  
	
  Unilin Systems SA

  	
  France

  	
  Unilin Systems  NV (99.76%)

  Private (0.24%)

  
	
  Unilin Systems Sud SAS

  	
  France

  	
  Unilin Systems SA (93.5%)

  Unilin Systems NV (5.7%)

  Private (0.8%)

  
	
  Unilin Beheer BV

  	
  The Netherlands

  	
  Unilin Systems NV

  
	
  Unilin/Multipre BV

  	
  The Netherlands

  	
  Unilin Beheer BV

  
	
  Unilin Systems BV

  	
  The Netherlands

  	
  Unilin Beheer BV

  
	
  Opstalan Holdings BV

  	
  The Netherlands

  	
  Unilin Systems NV

  
	
  Opstalan BV

  	
  The Netherlands

  	
  Opstalan Holding BV

  
	
  Cevotrans BV

  	
  The Netherlands

  	
  Opstalan BV

  
	
  IBC Timmerfabriek BV

  	
  The Netherlands

  	
  Opstalan BV

  
	
  Flooring Industries Ltd.

  	
  Ireland

  	
  Unilin Industries NV

  
	
  Timber Technique Services

  	
  Ireland

  	
  Flooring Industries Ltd.

  
	
  Timber Technique Finance
  Ltd.

  	
  Ireland

  	
  Flooring Industries Ltd. 

  
	
  Unilin GMBH

  	
  Germany

  	
  Unilin Industries NV

  
	
  Unilin UK Ltd. 

  	
  United Kingdom

  	
  Unilin Industries NV

  
	
  Mohawk International
  Holdings (DE) Corporation

  	
  Delaware

  	
  Borrower

  
	
  Mohawk Rock Holdings
  Limited

  	
  Gibraltar

  	
  Mohawk International Holdings
  (DE) Corporation

  
	
  Mohawk Global Investments
  S.à r.l.

  	
  Luxembourg

  	
  Mohawk Rock Holdings
  Limited

  

NY:791404.13

Schedule 5.06

Existing Liens

	
  Description of Leases

  	
  Starting Date

  	
  End Date

  	
  Total Reimbursements

  
	
  Unilin NV - Locabel 2002

  	
  12/20/2002

  	
  9/20/2010

  	
  €11,079,591.66

  
	
  Unilin SA - Locabel II

  	
  8/20/2000

  	
  5/20/2008

  	
  €14,176,874.76

  
	
  Unilin SA - Locindus I

  	
  12/17/1999

  	
  6/17/2009

  	
  €7,448,993.95

  
	

  	

  	
  2/3/2001

  	
  6/17/2009

  	
  €1,902,191.23

  
	
  Unilin SA - Locindus II

  	
  3/4/2004

  	
  6/17/2009

  	
  €9,504,147.58

  
	
  Systems Sud SAS - crédit
  bail

  	
  6/1/2003

  	
  3/1/2018

  	
  €476,161.16

  
					

NY:791404.13

Schedule 9.21

Conditions Precedent
Required To Be 

Delivered By An Additional Borrower

1.             An Accession
Letter, duly executed by the Additional Borrower and the Borrower.

2.             A copy of the
constitutional documents of the Additional Borrower.

3.             A copy of a
resolution of the board of directors of the Additional Borrower:

(a)           approving the
terms of, and the transactions contemplated by, the Accession Letter and the
Loan Documents and resolving that it execute the Accession Letter;

(b)           authorising a
specified person or persons to execute the Accession Letter on its behalf; and

(c)           authorizing a
specified person or persons, on its behalf, to sign and/or dispatch all other
documents and notices (including, in relation to an Additional Borrower, any
Notice of Borrowing or Notice of Continuation) to be signed and/or dispatched
by it under or in connection with the Loan Documents

4.             A specimen of
the signature of each person authorised by the resolution referred to in
paragraph 3 above.

5.             A certificate
of the Additional Borrower (signed by a director or officer) confirming that
borrowing under this Agreement would not cause any borrowing or similar limit
binding on it to be exceeded.

6.             A certificate
of an authorised signatory of the Additional Borrower certifying that each copy
document listed in this Schedule is correct, complete and in full force and
effect as at a date no earlier than the date of the Accession Letter.

7.             A copy of any
other authorisation or other document, opinion or assurance which the
Administrative Agent considers to be necessary or desirable in connection with
the entry into and performance of the transactions contemplated by the
Accession Letter or for the validity and enforceability of any Loan Document.

8.             If available,
the latest audited financial statements of the Additional Borrower.

9.             A legal
opinion of the legal advisers to the Administrative Agent in the jurisdiction
in which the Additional Borrower is incorporated.

10.           If the proposed
Additional Borrower is incorporated in a jurisdiction other than England and
Wales, evidence that the process agent specified in Clause 9.22 (Service of
process), if not an Borrower, has accepted its appointment in relation to
the proposed Additional Borrower.

NY:791404.13

[1] Complete with a Business Day pursuant to the
requirements of Section 2.02(a).

*  Subject to verification by the
Banks.EXHIBIT 10.1

                              AMENDED NELNET, INC.
                          EMPLOYEE SHARE PURCHASE PLAN

        1. PURPOSE.

        The purpose of the Nelnet, Inc. Employee Share Purchase Plan is to
provide eligible employees the opportunity to purchase Nelnet, Inc. Class A
Common Stock on a basis that qualifies for the tax treatment prescribed by
Section 423 of the Code.

        2. DEFINITIONS.

        The following terms, when used in the Plan, shall have the following
meanings:

        (a) "Board" or "Board of Directors" means the Board of Directors of the
Company, as constituted from time to time.

        (b) "Code" means the Internal Revenue Code of 1986, as amended from time
to time. References to a particular section of the Code include any successor
provisions.

        (c) "Committee" means the Compensation Committee of the Board, or such
other committee appointed by the Board of Directors to administer the Plan
pursuant to the provisions of Section 3(a) below.

        (d) "Common Stock" means Class A Common Stock, par value $.01 per share,
of the Company.

        (e) "Company" means Nelnet, Inc., a Nebraska corporation, or any
successor corporation.

        (f) "Fair Market Value" on a particular date means the mean between the
highest and lowest sales prices of a share of Common Stock on the principal
stock exchange or stock market on which the Common Stock may be listed or
admitted to trading. If there were no sales on such date, the respective prices
on the most recent prior day on which sales were reported shall be used. If the
foregoing method of determining fair market value should be inconsistent with
Section 423 of the Code, "Fair Market Value" shall be determined by the
Committee in a manner consistent with Section 423 of the Code and shall mean the
value as so determined.

        (g) "Offering" means a period, designed by the Committee in accordance
with the the provisions of Section 6 hereof, on the first day of which options
will be granted to eligible employees pursuant to Section 8(a) here of and on
the last day of which such options will be deemed exercised or will expire, as
applicable, in accordance with Section 8(b) hereof.

        (h) "Participant" or "Participating Employee" means an employee of the
Company or Participating Subsidiary who is eligible to participate in an
Offering under the Plan pursuant to Section 5 below and who elects to
participate in such Offering in accordance with Section 6 below.

        (i) "Participating Subsidiary" means, with respect to an Offering under
the Plan, a Subsidiary the employees of which are authorized by the Committee as
provided in Section 5 below to participate in such Offering.

        (j) "Plan" means the Nelnet, Inc. Employee Share Purchase Plan, as
amended from time to time.

                                       1
<PAGE>

        (k) "Parent" means a parent corporation as defined in Section 424(e) of
the Code, including a corporation which becomes such a parent in the future.

        (l) "Subsidiary" means a subsidiary corporation as defined in Section
424(f) of the Code, including a corporation which becomes such a subsidiary in
the future.

        (m) "Total Compensation" means, with respect to any Offering, the cash
compensation paid to a Participating Employee by the Company or a Participating
Subsidiary during the Offering for services, including overtime, premium pay,
commissions and annual bonus, in each case prior to reduction for pre-tax
contributions made to a plan or salary reduction contributions made to a plan
excludable from income under Sections 125 or 402(g) of the Code; provided,
however, that "Total Compensation" shall not include severance pay, stay-on
bonuses, retirement income, welfare benefits or income derived from stock
options, stock appreciation rights or other equity-based compensation.

        3. ADMINISTRATION.

        (a) The Plan shall be administered by the Compensation Committee of the
Board, or if designated by the Board such other committee of the Board
consisting of two or more directors.

        (b) Subject to the provisions of the Plan, the powers of the Committee
shall include having the authority, in its discretion, to:

                (i) define, prescribe, amend and rescind rules, regulations,
        procedures, terms and conditions relating to the Plan; and

                (ii) interpret, administer and construe the Plan and make all
        other determinations necessary or advisable for the administration of
        the Plan, including but not limited to correcting defects, reconciling
        inconsistencies and resolving ambiguities.

        (c) The interpretation by the Committee of the terms and conditions of
the Plan and its administration of the Plan, and all action taken by the
Committee, shall be final, binding and conclusive on the Company, its
stockholders, Subsidiaries, all Participants and employees, and upon their
respective successors and assigns, and upon all other persons claiming under or
through any of them.

        (d) Members of the Board, members of the Committee and persons to whom
authority is delegated under Section 3(e) below acting under this Plan shall be
fully protected in relying in good faith upon the advice of counsel and shall
incur no liability except for gross or willful misconduct in the performance of
their duties.

        (e) The Committee may delegate its authority to administer the Plan to
any individuals as the Committee may determine and such individuals shall serve
solely at the pleasure of the Committee. Any individuals who are authorized by
the Committee to administer the plan shall have the full power to act on behalf
of the Committee, but shall at all times be subordinate to the Committee and the
Committee shall retain ultimate authority for the administration of the Plan.

        4. STOCK SUBJECT TO THE PLAN.

        (a) Subject to paragraph (c) below, the aggregate number of shares of
Common Stock which may be sold under the Plan is 1,000,000 shares of Common
Stock.

                                       2
<PAGE>

        (b) If the number of shares of Common Stock that Participating Employees
become entitled to purchase is greater than the number of shares of Common Stock
that are offered in a particular Offering or that remain available under the
Plan, the available shares of Common Stock shall be allocated by the Committee
among such Participating Employees in such manner as it deems fair and
equitable.

        (c) In the event of any change in the Common Stock, through
recapitalization, merger, consolidation, stock dividend or split, combination or
exchange of shares, spin-off or otherwise, the Committee may make such equitable
adjustments in the Plan and the then outstanding Offerings as it deems necessary
and appropriate including, but not limited to, changing the number of shares of
Common Stock reserved under the Plan, and the purchase price of shares in the
current Offering; provided that any such adjustments shall be consistent with
Sections 423 and 424 of the Code.

        (d) Shares of Common Stock which are to be delivered under the Plan may
be obtained by the Company from its treasury, by purchasing such shares on the
open market or from private sources, or by issuing authorized but unissued
shares of Common Stock. Shares of authorized but unissued Common Stock may not
be delivered under the Plan if the purchase price thereof is less than the par
value (if any) of the Common Stock at the time. The Committee may (but need not)
provide at any time or from time to time (including without limitation upon or
in contemplation of a change in control) for a number of shares of Common Stock
equal in number to the number of shares then subject to options under this Plan
to be issued or transferred to, or acquired by, a trust (including but not
limited to a grantor trust) for the purpose of satisfying the Company's
obligations under such options, and, unless prohibited by applicable law, such
shares held in trust shall be considered authorized and issued shares with full
dividend and voting rights, notwithstanding that the options to which such
shares relate might not be exercisable at the time.

        5. ELIGIBILITY.

        All employees of the Company and any Subsidiaries designated by the
Committee from time to time will be eligible to participate in the Plan, in
accordance with and subject to such rules and regulations as the Committee may
prescribe; provided, however, that (a) such rules shall comply with the
requirements of the Code (including but not limited to Section 423 (b) (3), (4)
and (8) thereof), (b) no employee shall be eligible to participate in the Plan
if his or her customary employment is 20 hours or less per week or for not more
than five months in any calendar year, unless the Committee determines otherwise
on a uniform and non-discriminatory basis, (c) the Committee may (but need not)
in its discretion exclude employees who have been employed by the Company or a
Participating Subsidiary less than two years and/or highly compensated employees
within the meaning of Section 414(q) of the Code from being eligible to
participate in the Plan or any Offering, but unless and until otherwise
determined by the Committee, only employees who have been employed less than six
months will be excluded, (d) no employee may be granted an option under the Plan
if such employee, immediately after the option is granted, owns stock possessing
5% or more of the total combined voting power or value of all classes of stock
of his or her employer corporation or any Parent or Subsidiary (with the rules
of Section 424(d) of the Code applicable in determining the stock ownership of
an employee, and stock which the employee may purchase under outstanding
options, whether or not such options qualify for the special tax treatment
afforded by Section 421 (a) of the Code, shall be treated as stock owned by the
employee), and (e) all Participating Employees shall have the same rights and
privileges except as otherwise permitted by Section 423(b) (5) of the Code.

                                       3
<PAGE>

        6. OFFERINGS; PARTICIPATION

        The Company may make Offerings of up to 27 months' duration each, to
eligible employees to purchase shares of Common Stock under the Plan, until all
shares authorized to be delivered under the Plan have been exhausted or until
the Plan is sooner terminated by the Board. Subject to the preceding sentence,
the number, commencement date and duration of any Offerings shall be determined
by the Committee in its sole discretion; provided, however, that, unless the
Committee determines otherwise, (a) the first Offering shall commence as soon as
practical following the effectiveness of the Company's initial public offering
and shall extend through June 30, 2004, and (b) effective May 12, 2004, a new
three-month Offering will commence immediately after the end of each previous
Offering. The duration of any Offering need not be the same as the duration of
any other Offering, and more than one Offering may commence or terminate on the
same date if the Committee so provides. Subject to such rules and procedures as
the Committee may prescribe, an eligible employee may elect to participate in an
Offering at such time(s) as the Committee may permit by authorizing a payroll
deduction for such purpose in one percent increments of up to a maximum of
twenty percent (20%) of his or her Total Compensation with respect to such
Offering, or, effective May 12, 2004, a payroll deduction for such purpose in a
dollar amount of at least ten dollars ($10.00) per pay period, or in either
case, such lesser amount as the Committee may prescribe. Participant elections
may be made in any manner deemed appropriate by the Committee from time to time,
including by voice response or through the Internet. The Committee may (but need
not) permit employee contributions to be made by means other than payroll
deductions; provided, however, that in no event shall an employee's
contributions (excluding interest, if any, credited pursuant to Section 7(a)
below) from all sources in any Offering exceed twenty percent (20%) of his or
her Total Compensation with respect to such Offering or such lesser amount as
the Committee may prescribe. The Committee may at any time suspend or accelerate
the completion of an Offering if required by law or deemed by the Committee to
be in the best interests of the Company, including in the event of a change in
ownership or control of the Company or any Subsidiary.

        7. PAYROLL DEDUCTIONS.

        (a) The Company will maintain payroll deduction accounts on its books
for all Participating Employees, and may (but need not) credit such accounts
with interest if (and only if) the Committee so directs at such rate (if any) as
the Committee may prescribe. All employee contributions and any interest thereon
which the Committee may authorize in accordance with the preceding sentence
shall be credited to such accounts. Employee contributions and any interest
credited to the payroll deduction accounts of Participating Employees need not
be segregated from other corporate funds and may be used for any corporate
purpose.

        (b) At such times as the Committee may permit and subject to such rules
and procedures as the Committee may prescribe; a Participating Employee may
suspend his or her payroll deduction during an Offering, or may withdraw the
balance of his or her payroll deduction account and thereby withdraw from
participation in an Offering, provided, effective May 12, 2004, Participating
Employees may suspend their payroll deduction during an Offering but may not
withdraw the balance of their payroll deduction account during an Offering; and
further provided, effective for Offerings commencing after April 21, 2005,
Participating Employees who are "insiders" (as determined by the Company's
Securities Trading Committee) may not suspend payroll deductions during an
Offering.

        (c) Any balance remaining in an employee's payroll deduction account
after shares have been purchased in an Offering pursuant to Section 8(b) below
will be refunded to the Participating Employee, provided, effective May 12,
2004, such balances may not be withdrawn and provided further, fractional shares
may be purchased by Participating Employees, and accordingly any such balance
will not be refunded and instead will be used to purchase shares at the end of
the Offering. Upon termination of the Plan, all amounts in the accounts of
Participating Employees shall be carried forward into their payroll deduction
accounts under a successor plan, if any, or refunded to them, as the Committee
may decide.

        (d) In the event of the termination of a Participating Employee's
employment for any reason, his or her participation in any Offering under the
Plan shall cease, no further amounts shall be deducted pursuant to the Plan and
the balance in such employee's account shall be paid as soon as practicable
following such termination of employment to the employee, or, in the event of
such employee's death, to such employee's beneficiary designated under this Plan
or, in the absence of such a beneficiary designation, to such employee's estate.

                                       4
<PAGE>

        8. PURCHASE; LIMITATIONS.

        (a) Subject to Section 5 above and within the limitations of Section
8(d) below, each person who is an eligible employee of the Company or a
Participating Subsidiary on the first day of an Offering under the Plan is
hereby granted an option, on the first day of such Offering, to purchase up to a
number of whole shares of Common Stock at the end of such Offering determined by
dividing twenty percent (or such lesser percentage as may be specified by the
Committee as the maximum employee contribution percentage in such Offering) of
such employee's Total Compensation with respect to such Offering, plus such
interest (if any) as the Committee may authorize to be credited during such
Offering in accordance with Section 7(a) above, by 85 percent of the Fair Market
Value of a share of Common Stock on the first date of such Offering or on the
last date of such Offering; provided, however, that in no event shall the number
of shares of Common Stock that may be purchased under any such option exceed
2500 shares or such higher or lower number of shares as the Committee may have
specified in advance of such Offering as the maximum amount of stock which may
be purchased by an employee in such Offering. The purchase price of such shares
under such options shall be determined in accordance with Section 8(c) below.
The Company's obligation to sell and deliver Common Stock in any Offering or
pursuant to any such option shall be subject to the approval of any governmental
authority whose approval the Committee determines it is necessary or advisable
to obtain in connection with the authorization, issuance, offer or sale of such
Common Stock.

        (b) As of the last day of the Offering, the payroll deduction account of
each Participating Employee shall be totaled. Subject to the provisions of
Section 7(b) above and 8(d) below, if such account contains sufficient funds as
of that date to purchase one or more whole shares of Common Stock at the price
determined under Section 8(c) below, the Participating Employee shall be
conclusively deemed to have exercised the option granted pursuant to Section
8(a) above for as many whole shares of Common Stock as the amount of his or her
payroll deduction account (including any contributions made by means other than
payroll deductions and including any interest credited to the account) at the
end of the Offering can purchase (but in no event for more than the total number
of shares that are subject to the option); such employee's account will be
charged for the amount of the purchase and for all purposes under the Plan the
employee will be deemed to have acquired the shares on that date; and either a
stock certificate representing such shares will be issued to him or her, or the
Company's record keeper will make an entry on its books and records evidencing
that such shares have been duly issued or transferred as of that date, as the
Committee may direct. Any option granted pursuant to Section 8(a) above which is
not deemed exercised as of the last day of the Offering in accordance with the
foregoing provisions of this Section 8(b) shall expire on that date.

        (c) Unless the Committee determines before the first day of an Offering
that a higher price that complies with Section 423 of the Code shall apply, the
price at which shares of Common Stock may be purchased under each option granted
pursuant to Section 8(a) above shall be the lesser of (i) an amount equal to 85
percent of the Fair Market Value of the Common Stock at the time such option is
granted, or (ii) an amount equal to 85 percent of the Fair Market Value of the
Common Stock at the time such option is exercised.

        (d) In addition to any other limitations set forth in the Plan, no
employee may be granted an option under the Plan which permits his or her rights
to purchase stock under the Plan, and any other stock purchase plan of his or
her employer corporation and its Parent and Subsidiary that is qualified under
Section 423 of the Code, to accrue at a rate which exceeds $25,000 of the Fair
Market Value of such stock (determined at the time such option is granted) for
each calendar year in which the option is outstanding at any time. The Committee
may further limit the amount of Common Stock which may be purchased by any
employee during an Offering in accordance with Section 423(b) (5) of the Code.

        9. HOLDING PERIOD.

        Unless the Committee should determine otherwise, all Common Stock
acquired under the Plan is subject to a two year holding period, provided,
effective May 12, 2004 all Common Stock acquired under the Plan is subject to a
one year holding period. For purposes of measuring a given holding period, the
commencement date shall be the date which is one day after the last day of an
Offering. During the holding period, no shares acquired through the Plan may be
sold, transferred or otherwise disposed, other than by will, the laws of descent
and distribution, or if Participant is no longer employed by the Company or its
Subsidiaries.

                                       5

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