Document:

EIGHTH AMENDMENT TO CREDIT

                             AND GUARANTY AGREEMENT

      THIS EIGHTH AMENDMENT,  dated as of November 29, 1999 (this  "Amendment"),
to the Existing  Credit  Agreement  referred to below,  is among IMO  INDUSTRIES
INC., a Delaware  corporation (the  "Borrower"),  COLFAX  CORPORATION  (formerly
known as II Acquisition Corp.), a Delaware  corporation (the "Parent"),  and the
Lenders (as defined below) parties hereto.

                             W I T N E S S E T H:
                             -------------------

      WHEREAS,  the Borrower,  the Parent,  certain financial  institutions from
time to time parties thereto  (collectively,  the  "Lenders"),  The Bank of Nova
Scotia, as the Administrative Agent and the Documentation Agent, and NationsBanc
Capital Markets,  Inc., as the Syndication  Agent,  have entered into the Credit
and Guaranty Agreement,  dated as of August 29, 1997 (as amended,  supplemented,
amended  and  restated  or  otherwise  modified  prior to the date  hereof,  the
"Existing  Credit  Agreement"  and,  as amended  by,  and  together  with,  this
Amendment, the "Credit Agreement"); and

      WHEREAS,  the  Borrower  and the Parent have  requested  that the Existing
Credit  Agreement  be amended in certain  respects  and that the  Lenders  waive
certain  requirements  of, and provide  their  consent  with  respect to certain
transactions  which would  otherwise be  prohibited  by the  provisions  of, the
Existing  Credit  Agreement  and the Lenders  have agreed to amend the  Existing
Credit  Agreement  and to grant such waivers and consents  (subject to the terms
and conditions of this Amendment);

      NOW, THEREFORE,  in consideration of the premises and the other provisions
herein contained, the parties hereto hereby agree as follows.

                                     PART I

                                   DEFINITIONS

      SUBPART I.1.  Use of Defined Terms.  Unless otherwise defined herein or
                    --------------------
the context  otherwise  requires,  terms used in this  Amendment,  including its
preamble  and  recitals,  have the  meanings  set forth in the  Existing  Credit
Agreement.

                                     PART II

                        AMENDMENTS, WAIVERS AND CONSENTS

                        TO THE EXISTING CREDIT AGREEMENT

      Effective  upon (and subject to) the  occurrence  of the Eighth  Amendment
Effective  Date (as  defined  in  Subpart  3.1) or, as  applicable,  the  Sierra
Acquisition  Effective  Date (as  defined in  Subpart  3.2),  certain  terms and
provisions of the Existing Credit Agreement are hereby amended,  and the waivers
and consent  described  below are hereby  granted,  all in accordance  with this
Part.  Except as so amended or modified by this  Amendment,  the Existing Credit
Agreement  and the Loan  Documents  shall  continue  in full force and effect in
accordance with their terms.

      SUBPART II.1.  Amendment to Article I.  Article I of the Existing
                     ----------------------
Credit Agreement is hereby amended in accordance with Subparts 2.1.1 through
                                                      --------------
2.1.2.

-----

      SUBPART II.1.1. Section 1.1 of the Existing Credit Agreement is hereby
amended by adding the following new definitions in their appropriate
alphabetical sequence:

            "Amendment No. 8" means the Eighth Amendment, dated as of
             ---------------
      November 29, 1999, to this  Agreement  among the Borrower,  the Parent and
      the Lenders parties thereto.

            "Conduit" means Liberty Street Funding Corp., a Delaware
             -------
corporation.

            "Contract"  means,  with  respect  to any  Receivable,  any  and all
      contracts,  instruments,  agreements,  leases,  invoices,  notes  or other
      writings  pursuant to which such  Receivable  arises or that evidence such
      Receivable or under which a Receivables Obligor becomes or is obligated to
      make payment in respect of such Receivable.

            "Eighth Amendment Effective Date" is defined in Subpart 3.1 of
             -------------------------------
      Amendment No. 8.

            "Illinois Fee Property" is defined in Subpart 3.2.3 of Amendment
             ---------------------
      No. 8.

            "Illinois Lease" is defined in Subpart 3.2.3 of Amendment No. 8.
             --------------

            "Illinois Leased Property" is defined in Subpart 3.2.3 of
             ------------------------
      Amendment No. 8.

            "Mortgage Amendment" is defined in Subpart 3.2.3 of Amendment No. 8.
             ------------------

            "Permitted  Receivables  Transaction" means the transaction effected
      pursuant  to the  Transaction  Documents  (as such term is  defined in the
      Receivables  Purchase  Agreement)  providing  for the sale or financing of
      Receivables  and Related Rights by the Borrower and its U.S.  Subsidiaries
      with no more than customary  limited recourse based on the  collectability
      of the Receivables sold.

            "Purchase and Sale Agreement" means the Purchase and Sale Agreement,
      dated as of November 29, 1999 among the Borrower and Warren  Pumps,  Inc.,
      as originators, the Borrower, as servicer, and the Conduit, as purchaser.

            "Receivable"  means (a) any indebtedness and other  obligations owed
      to the Borrower or any U.S. Subsidiary by, or any right of the Borrower or
      any U.S. Subsidiary to payment from or on behalf of, a Receivables Obligor
      whether  constituting  an account,  chattel  paper,  instrument or general
      intangible  arising in connection  with the sale of goods or the rendering
      of services by such Person, and includes the obligation to pay any finance
      charges, fees and other charges with respect thereto;  provided, that none
      of the foregoing shall be deemed to be a "Receivable" hereunder unless and
      until the same shall be purchased by Receivables Co. pursuant to the terms
      of  the  Permitted  Receivables   Transaction  and  (b)  any  "Receivable"
      purchased from the Borrower or any U.S. Subsidiary (other than Receivables
      Co.) by Receivables Co. pursuant to the terms of the Permitted Receivables
      Transaction.

            "Receivables Co." means Imo Funding Company, LLC, a special
             ---------------
      purpose, bankruptcy-remote wholly-owned U.S. Subsidiary of the Borrower
      organized under the laws of the state of Delaware.

            "Receivables   Facility   Outstandings"   means,   at  any  date  of
      determination,  with respect to the Permitted Receivables Transaction, the
      aggregate   cash  proceeds   received  by  the  Borrower  or  any  of  its
      wholly-owned  U.S.  Subsidiaries from the sale or financing of Receivables
      and Related Rights pursuant to the Permitted Receivables Transaction which
      Receivables   and  Related   Rights  are   outstanding   on  the  date  of
      determination,  which  amount  shall be equal to the amount of Capital (as
      defined in the Receivables Purchase Agreement) outstanding on such date of
      determination.

            "Receivables  Obligor" means,  with respect to any  Receivable,  the
      Person  obligated to make  payments  pursuant to the Contract  relating to
      such Receivable.

            "Receivables  Purchase  Agreement"  means the  Receivables  Purchase
      Agreement, dated as of November 29, 1999 among Receivables Co., as seller,
      the Borrower,  as servicer,  the Conduit,  as issuer,  and Scotiabank,  as
      administrator.

            "Related Rights" means,
             --------------

            (a) all rights to, but not the obligations under, all Related
      Security;

            (b) all monies due or to become due with respect to any
      Receivable and any of the foregoing;

            (c) all books and records related to any Receivable and any of
      the foregoing; and

            (d) all proceeds  thereof (as defined in the U.C.C.)  received on or
      after the date  hereof  including,  without  limitation,  all funds  which
      either are  received  by the  Borrower or any U.S.  Subsidiary  from or on
      behalf  of  the  Receivables  Obligors  in  payment  of any  amounts  owed
      (including,  without limitation,  finance charges,  interest and all other
      charges) in respect of Receivables, or are applied to such amounts owed by
      the  Receivables  Obligors  (including,   without  limitation,   insurance
      payments,  if any, that the Borrower or any U.S. Subsidiary applies in the
      ordinary  course  of its  business  to  amounts  owed  in  respect  of any
      Receivable).

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

            (a) all of the Borrower's or any U.S.  Subsidiary's  interest in any
      goods (including  returned goods),  and  documentation of title evidencing
      the shipment or storage of any goods (including returned goods),  relating
      to any sale giving rise to such Receivable,

            (b) all instruments and chattel paper that may evidence such
      Receivable,

            (c) all  other  security  interests  or liens and  property  subject
      thereto from time to time purporting to secure payment of such Receivable,
      whether  pursuant to the Contract related to such Receivable or otherwise,
      together with all U.C.C.  financing statements or similar filings relating
      thereto, and

            (d) all of the Borrower's or any U.S. Subsidiary's rights, interests
      and claims under the Contracts and all guaranties,  indemnities, insurance
      and other agreements  (including the related  Contract) or arrangements of
      whatever  character  from time to time  supporting or securing  payment of
      such Receivable or otherwise relating to such Receivable, whether pursuant
      to the Contract related to such Receivable or otherwise.

            "Sierra" means Sierra International Inc., an Illinois corporation.
             ------

            "Sierra Acquisition Effective Date" is defined in Subpart 3.2 of
             ---------------------------------
      Amendment No. 8.

            "Sierra Mortgage" is defined in Subpart 3.2.3 of Amendment No. 8.
             ---------------

            "Sierra Stock Purchase Agreement" means the Stock Purchase
             -------------------------------
      Agreement, dated as of October 13, 1999, between the Borrower and
      Echlin Inc., a Connecticut corporation.

      SUBPART II.1.2.  Section 1.1 of the Existing Credit Agreement is hereby
further amended as follows:

            (a) by  amending  the  definitions  of  "Applicable  Commitment  Fee
      Margin" and "Applicable  Margin", in each case, by replacing the reference
      to "clause  (c) of Section  7.1.1"  each time it  appears  therein  with a
      reference to "clause (b) of Section 7.1.1";

            (b) by amending the definition of "Indebtedness" by (i) deleting the
      word "and" which immediately follows clause (f) thereto, (ii) adding a new
      clause (g) thereto which shall read "(g) for purposes of  calculating  the
      Leverage Ratio and Total Debt, all Receivables  Facility  Outstandings (it
      being  understood  and  agreed  by the  parties  that for  GAAP and  other
      purposes, such Receivables Facility Outstandings shall not be deemed to be
      "Indebtedness");  and" and  (iii)  re-lettering  the  current  clause  (g)
      thereto as clause (h) thereto;

            (c)  by  amending  the  definition  of  "Interest  Expense"  by  (i)
      replacing the phrase "including,  without duplication,"  appearing therein
      with the phrase "including,  without duplication,  (i)" and (ii) replacing
      the "." appearing at the end of such  definition with the phrase "and (ii)
      interest (or other fees in the nature of interest or discount  accrued and
      paid or  payable in cash for such  period)  in  respect  of the  Permitted
      Receivables Transaction.";

            (d) by amending the  definition of "Net Debt  Proceeds" by replacing
      the reference to "clause (m) of Section  7.2.2"  appearing  therein with a
      reference to "clause (n) of Section 7.2.2";

            (e) by amending the  definition  of "Net Income" by adding a proviso
      prior  to the "." at the  end of  such  definition  which  shall  provide:
      "provided,  however, that following the Sierra Acquisition Effective Date,
      such net income for the first three  Fiscal  Quarters  prior to the Sierra
      Acquisition   Effective  Date  will,  for  all  purposes  other  than  the
      calculation  of Excess Cash Flow,  be  calculated  on a pro forma basis to
      give  effect  to the  acquisition  of Sierra  as if such  acquisition  had
      occurred at the beginning of such period"; and

            (f) by amending the  definition  of "Total  Debt" by  replacing  the
      reference to "clause (a), (b) or (c) of the  definition  of  Indebtedness"
      appearing therein with a reference to "clauses (a), (b), (c) or (g) of the
      definition of Indebtedness".

      SUBPART II.2.  Amendment to Article VI.  Article VI of the Existing
                     -----------------------
Credit Agreement is hereby amended in accordance with Subpart 2.2.1.

                                                      -------------

      SUBPART II.2.1.  A new Section 6.25 is hereby added to the Existing Credit
Agreement immediately following Section 6.24 which shall provide as follows:

            "SECTION 6.25. Year 2000. Each Obligor has reviewed the areas within
      its business and operations which could be adversely  affected by, and has
      developed  or is  developing a program to address on a timely  basis,  the
      "Year 2000 Problem" (that is, the risk that computer  applications used by
      such   Obligor  may  be  unable  to   recognize   and   properly   perform
      date-sensitive  functions  involving  certain dates prior to, and any date
      after, December 31, 1999). Based on such review and program, the Year 2000
      Problem could not reasonably be expected to have a material adverse effect
      on the financial  condition,  operations,  assets,  business,  properties,
      revenues or  prospects of the  Borrower  and its  Subsidiaries  taken as a
      whole."

      SUBPART II.3.  Amendments to Article VII.  Article VII of the Existing
                     -------------------------
Credit Agreement is hereby amended in accordance with Subparts 2.3.1 through
                                                      --------------
Subpart 2.3.16.
---------------

      SUBPART II.3.1.  Section 7.1.8 of the Existing Credit  Agreement is hereby
amended by  replacing  the phrase "upon any Person"  appearing  therein with the
phrase "upon any Person  (other than, at all times prior to the  termination  of
the Permitted Receivables Transaction, Receivables Co.)".

      SUBPART II.3.2.  Section 7.1.16 of the Existing Credit Agreement is hereby
amended by replacing the word "Subsidiaries" each time such word appears therein
with the phrase "Subsidiaries (other than, at all times prior to the termination
of the Permitted Receivables Transaction, Receivables Co.)".

      SUBPART  II.3.3.  A new  Section  7.1.19 is hereby  added to the  Existing
Credit  Agreement  immediately  following  Section 7.1.18 which shall provide as
follows:

            "SECTION  7.1.19.  Sierra Real Estate Matters.  Each of the Borrower
      and the Parent agrees to use its best efforts to obtain a Landlord  Waiver
      and Consent Agreement,  in form and substance  reasonably  satisfactory to
      the  Administrative  Agent,  with  respect  to any Lease  encumbering  the
      Florida Property under which Sierra,  the Borrower or any other Obligor is
      lessee."

      SUBPART II.3.4.  Effective upon the Sierra Acquisition Effective Date,
Section 7.1.19 is hereby amended in its entirety to read as follows:

            "SECTION  7.1.19.  Sierra Real Estate Matters.  The Borrower and the
      Parent  agree to cause  Sierra,  no later than  ninety (90) days after the
      Sierra Acquisition Effective Date, to:

                  (a) acquire the Illinois  Leased  Property  pursuant to and in
            accordance  with the terms of the Illinois Lease.  Immediately  upon
            Sierra's  acquisition of the Illinois Leased Property,  the Borrower
            and the Parent agree to so notify the  Administrative  Agent and, at
            the Borrower's  sole cost and expense,  the Borrower shall, or shall
            cause Sierra to, (i)  authorize the  Administrative  Agent to record
            the Mortgage  Amendment,  (ii) take all further actions necessary or
            required by the  Administrative  Agent, in its sole  discretion,  to
            cause said Illinois Leased Property to be subject to the Lien of the
            Sierra  Mortgage and (iii)  deliver to the  Administrative  Agent an
            endorsement to the mortgagee's  title insurance  policy with respect
            to the Illinois Fee Property,  which  endorsement  shall insure that
            the  Sierra  Mortgage,  as  modified  and  spread  by  the  Mortgage
            Amendment,  constitutes a valid first  priority Lien on the Illinois
            Fee Property and the Illinois Leased Property, free and clear of all
            Liens other than those  approved  by the  Administrative  Agent.  If
            Sierra fails to exercise  its option to acquire the Illinois  Leased
            Property within the ninety (90) day period described above, then the
            Borrower and the Parent shall cause Sierra to immediately deliver to
            the Administrative Agent any instrument or documents required by the
            Administrative  Agent,  in its sole  discretion,  to  create a valid
            first priority Lien on Sierra's  leasehold  interest in the Illinois
            Leased  Property and any other  instruments,  agreements,  insurance
            policies,  surveys or other documents required by the Administrative
            Agent  with  respect to the  Illinois  Leased  Property,  including,
            without limitation,  all of the documents described in Subpart 3.2.3
            to Amendment No. 8; and

                  (b) obtain a Landlord  Waiver and Consent  Agreement,  in form
            and substance reasonably  satisfactory to the Administrative  Agent,
            with respect to any Lease  encumbering  the Florida  Property  under
            which Sierra, the Borrower or any other Obligor is lessee."

      SUBPART II.3.5.  Section 7.2.1 of the Existing Credit  Agreement is hereby
amended by replacing  the word  "Subsidiaries"  which  appears  therein with the
phrase  "Subsidiaries  (other than, at all times prior to the termination of the
Permitted Receivables Transaction, Receivables Co.)".

      SUBPART II.3.6.  Section 7.2.2 of the Existing Credit  Agreement is hereby
amended by (i)  deleting  the word "and" which  immediately  follows  clause (l)
thereto,  (ii)  adding a new clause (m) thereto  which  shall read "(m)  without
duplication,  Indebtedness of the Borrower,  its U.S.  Subsidiaries  (other than
Receivables Co.) or Receivables  Co., in each case,  incurred in connection with
the Permitted Receivables  Transaction in an aggregate amount at any time not to
exceed  $35,000,000;  and", (iii) re-lettering the current clause (m) thereto as
clause (n) thereto and (iv) by deleting  the phrase "(l) and (m)"  appearing  in
the proviso  thereto and  replacing  such phrase with the phrase  "(l),  (m) and
(n)".

      SUBPART II.3.7.  Section 7.2.3 of the Existing Credit  Agreement is hereby
amended by (i)  deleting  the word "and" which  immediately  follows  clause (h)
thereto,  (ii)  adding a new clause (i)  thereto  which shall read "(i) Liens on
Receivables and Related Rights of the Borrower or any U.S. Subsidiary; provided,
that such Liens shall only be  permitted  to the extent  that they solely  cover
Excluded  Property (as such term is defined in the Security  Agreements) and are
created in connection  with the Permitted  Receivables  Transaction;  and",  and
(iii) re-lettering the current clause (i) thereto as clause (j) thereto.

      SUBPART  II.3.8.  Effective upon the Sierra  Acquisition  Effective  Date,
Section 7.2.3 of the Existing Credit  Agreement is hereby further amended by (i)
deleting  the word "and" which  immediately  follows  clause (i)  thereto,  (ii)
adding a new clause (j)  thereto  which shall read "(j) those  certain  Liens on
assets of Sierra  set forth on  Schedule  4.8(a) of the  Sierra  Stock  Purchase
Agreement  to the extent that such Liens extend  solely to  equipment  leased by
Sierra;  and", and (iii)  re-lettering  the current clause (j) thereto as clause
(k) thereto.

      SUBPART II.3.9.  Section 7.2.5 of the Existing Credit  Agreement is hereby
amended by (i) replacing the phrase "the Borrower's  Investment  existing on the
Effective  Date in its  Subsidiaries"  appearing  in clause (a) thereof with the
phrase "the  Borrower's  Investment  (i) existing on the  Effective  Date in its
Subsidiaries  and (ii) in Receivables  Co., by way of  contributions  to capital
from time to time; provided,  that such Investments in Receivables Co. shall (x)
only be made in  connection  with,  and  subject to the terms of, the  Permitted
Receivables  Transaction and (y) not in the aggregate exceed  $3,000,000.00 (not
more than  $1,000,000.00 of which shall have been made in cash)",  (ii) deleting
clause (c) thereof in its entirety and replacing  such clause with the following
"without  duplication,  Investments  (i) permitted as  Indebtedness  pursuant to
clauses  (d),  (f),  (h) and (k) of Section  7.2.2 and (ii) to the  extent  that
Receivables Co. is not a Subsidiary of the Borrower,  Investments in Receivables
Co.  in  connection  with  the  Permitted  Receivables  Transaction  made by the
Borrower and/or its Subsidiaries (x) on terms satisfactory to the Administrative
Agent  and (y) not in the  aggregate  to  exceed  $3,000,000.00  (not  more than
$1,000,000.00  of which shall have been made in cash)" and (iii)  replacing  the
phrase  "other  Investments"  appearing  in clause (g)  thereof  with the phrase
"other Investments (other than by Receivables Co.)".

      SUBPART II.3.10.  Section 7.2.7 of the Existing Credit Agreement is hereby
amended by replacing the phrase  "other  Subsidiaries  of the Parent"  appearing
therein  with  the  phrase  "other   Subsidiaries  of  the  Parent  (other  than
Receivables Co.)".

      SUBPART II.3.11. Section 7.2.10 of the Existing Credit Agreement is hereby
amended by replacing  the word  "Subsidiary"  appearing  therein with the phrase
"Subsidiary (other than Receivables Co.)".

      SUBPART II.3.12. Section 7.2.11 of the Existing Credit Agreement is hereby
amended by  replacing  the phrase  "or (iv) any  assets of a  Subsidiary  of the
Borrower to the  Borrower" set forth in clause (c) thereof with the phrase "(iv)
any assets of a Subsidiary of the Borrower to the Borrower,  or (v)  Receivables
and Related Rights pursuant to the Permitted Receivables Transaction;  provided,
however,  that  notwithstanding  the foregoing,  the aggregate fair market value
outstanding  at any one time of  Receivables  and  Related  Rights  which may be
Disposed of pursuant to this clause (c)(v) shall not exceed $45,000,000.00".

      SUBPART II.3.13. Section 7.2.12 of the Existing Credit Agreement is hereby
amended by deleting such section in its entirety and replacing such section with
the following:

            "SECTION  7.2.12.  Modification of Certain  Agreements.  Neither the
      Borrower nor the Parent will, nor will they permit any of their respective
      Subsidiaries  to,  (a)  consent  to any  amendment,  supplement  or  other
      modification of any of the terms or provisions contained in, or applicable
      to,  any  Organic  Document,  the  Borrower  Preferred  Stock,  the Parent
      Subscription   Agreement,   the  Borrower  Subscription   Agreement,   the
      Subordinated  Notes,  other than any such  amendment,  supplement or other
      modification  which is immaterial and which could not adversely affect the
      Administrative  Agent or any Lender (it being  understood and agreed that,
      in any event, any modification to the subordination provisions of, and any
      of  the  defined  terms  therein,  including,  but  not  limited  to,  the
      definition of "Specified  Senior  Indebtedness" of the Subordinated  Notes
      shall be deemed to be material); or

            (b)  without  the prior  written  consent of the  Required  Lenders,
      consent to any material  amendment,  supplement,  or other modification to
      any of the terms of the documents, instruments and agreements delivered in
      connection with the Permitted Receivables Transaction, other than any such
      amendment,  modification  or change  which (x) would  extend the  maturity
      thereof or (y) does not in any way  adversely  affect the interests of the
      Managing  Agents,  the Lenders or the Issuer  hereunder  or under the Loan
      Documents  (including,  without limitation,  amendments,  modifications or
      changes of a technical or clarifying nature)."

      SUBPART II.3.14. Section 7.2.14 of the Existing Credit Agreement is hereby
amended by (i) replacing the phrase "excluding this Agreement" appearing therein
with the  phrase  "excluding  (i) this  Agreement",  (ii)  replacing  the phrase
"guaranteed by the Borrower"  appearing  therein with the phrase  "guaranteed by
the  Borrower,  (ii) in the case of clause  (a)(i),  restrictions  contained  in
documents or agreements  delivered in connection with the Permitted  Receivables
Transaction,  provided that such  restrictions  are only  effective  against the
Receivables  and Related  Rights  financed or acquired  thereby and (iii) in the
case of clause (b),  restrictions on Receivables Co.  contained in documentation
delivered  for  the  Permitted  Receivables  Transaction   (including,   without
limitation,  the operating  agreement and other Organic Documents of Receivables
Co.)", (iii) replacing the phrase "the creation" appearing in clause (a) thereof
with the  phrase  "the (i)  creation"  and (iv)  replacing  the  phrase  "or the
ability" appearing in clause (a) thereof with the phrase "or (ii) ability".

      SUBPART II.3.15. Section 7.2.15 of the Existing Credit Agreement is hereby
amended by  replacing  the phrase  "payable to  independent  directors,  or (v)"
appearing  therein  with the  phrase  "payable  to  independent  directors,  (v)
reasonable   fees  payable  in  connection   with  the   Permitted   Receivables
Transaction, or (vi)".

      SUBPART II.3.16.  Section 7.2.20 of the Existing Credit Agreement is
hereby amended by replacing the phrase "any U.S. Subsidiaries" appearing
therein with the phrase "any U.S. Subsidiaries (other than Receivables Co.)".

      SUBPART II.4.  Amendment to Article VIII.  Article VIII of the Existing
                     -------------------------
Credit  Agreement is hereby  amended by inserting a new Section  8.1.11  therein
which provides as follows:

            "SECTION 8.1.11.  Termination of Permitted Receivables  Transaction.
      Any event or  circumstance  shall  occur  which  permits or  requires  the
      Persons purchasing, or financing the purchase of, eligible Receivables and
      Related  Rights under the  Permitted  Receivables  Transaction  to stop so
      purchasing or financing such Receivables and Related Rights, other than by
      reason  of the  occurrence  of the  stated  expiry  date of the  Permitted
      Receivables  Transaction;  provided, that any notices or cure periods that
      are  conditions  to the  rights of such  Persons  to stop  purchasing,  or
      financing the purchase of, such  Receivables  and Related Rights have been
      given or have expired, as the case may be."

      SUBPART II.5.  Amendment to Article XI.  Article XI of the Existing
                     -----------------------
Credit Agreement

is hereby amended in accordance with Subpart 2.5.1.
                                     -------------

      SUBPART II.5.1.  Section 11.1 of the Existing  Credit  Agreement is hereby
amended by replacing the phrase  "except as otherwise  specifically  provided in
any Loan  Document"  appearing in clause (b) thereof with the phrase  "except as
otherwise  specifically  provided in any Loan  Document  (including  the sale or
transfer of  Receivables  and Related  Rights in  accordance  with the Permitted
Receivables Transaction)".

      SUBPART II.6.  Additional Conforming Amendments to Exhibits to Credit
                     ------------------------------------------------------
Agreement.
---------

      SUBPART II.6.1.  Exhibit F (Form of Compliance  Certificate) to the Credit
Agreement  is hereby  amended  by  replacing  Attachments  1 and 3 thereto  with
Attachments 1 and 3 attached hereto as Annex 1.

      SUBPART II.7.  Waiver Regarding Section 3.1.2 of the Existing Credit
                     -----------------------------------------------------
Agreement ("Mandatory Repayments and Prepayments").  Notwithstanding anything
--------------------------------------------------
to the contrary  contained  in the  Existing  Credit  Agreement  (including  the
definition of the term "Net Disposition Proceeds" or Section 3.1.2 thereto), the
Lenders hereby waive any mandatory  prepayment event which would otherwise arise
in connection  with the sale or transfer of  Receivables  and Related  Rights to
Receivables Co. or by Receivables Co. to the Conduit.

      SUBPART  II.8.  Waiver  Regarding  Section  7.1.8 of the  Existing  Credit
Agreement  ("Future  Subsidiaries").   Effective  upon  the  Sierra  Acquisition
Effective  Date,  notwithstanding  anything  to the  contrary  contained  in the
Existing Credit Agreement (including Section 7.1.8 thereto),  the Lenders hereby
waive any  requirement  that, in connection with the acquisition by the Borrower
of Sierra  pursuant to the terms and  conditions  contained  in the Sierra Stock
Purchase Agreement,  the Liens set forth on Schedule 4.8(a) of such agreement be
released  to the extent that such Liens  extend  solely to  equipment  leased by
Sierra.

      SUBPART II.9.  Consent  Regarding  Partial  Release of Liens.  Each of the
Lenders hereby  authorizes and directs the  Administrative  Agent to release and
terminate,  at the Borrower's expense and without  representation or warranty of
any kind by any Lender or any Managing Agent,  all Liens and security  interests
in and to all Receivables and Related Rights previously  granted by the Obligors
under  any  Security  Agreement  in favor of the  Administrative  Agent  and the
Lenders to the extent  (and only to the  extent)  such  Receivables  and Related
Rights are sold, or purported to be sold, pursuant to the Permitted  Receivables
Transaction.  The  Administrative  Agent  will,  at the  Borrower's  expense and
without  representation or warranty (and the Lenders hereby authorize and direct
the Administrative  Agent to) deliver to the Borrower executed copies of Uniform
Commercial Code (Form U.C.C.-3) amendment statements or similar instruments with
respect to each of the filings  previously made pursuant to a Security Agreement
(as such term is defined in the Credit  Agreement)  necessary  to give effect to
the release of the Liens set forth in this Subpart.

                                    PART III

                           CONDITIONS TO EFFECTIVENESS

      SUBPART  III.1.  This  Amendment  shall become  effective on the date (the
"Eighth  Amendment  Effective  Date") when all of the following  conditions have
been satisfied to the satisfaction of the Administrative Agent.

      SUBPART III.1.1.  Execution of Counterparts.  The Administrative Agent
                        -------------------------
shall have received copies of this Amendment, duly executed and delivered by the
Borrower, the Parent and the Lenders.

      SUBPART III.1.2.  Resolutions,  etc. The  Administrative  Agent shall have
received  from the  Borrower  and each other  Obligor a  certificate,  dated the
Eighth Amendment  Effective Date, of its Secretary or Assistant  Secretary as to
resolutions of its Board of Directors then in full force and effect  authorizing
the  execution,  delivery and  performance of this Amendment and each other Loan
Document to be executed by such Obligor.

      SUBPART III.1.3.  Affirmation and Consent.  The Administrative Agent
                        -----------------------
shall  have  received  an   affirmation   and  consent  in  form  and  substance
satisfactory to it, duly executed and delivered by each Subsidiary Guarantor.

      SUBPART III.1.4.  Pro Forma  Compliance  Certificate.  The  Administrative
Agent shall have  received,  with  counterparts  for each  Lender,  a Compliance
Certificate (which Compliance Certificate shall be prepared by using Attachments
1 and 3  attached  hereto as Annex 1) giving  pro  forma  effect to the  initial
funding of the Permitted  Receivables  Transaction,  dated the Eighth  Amendment
Effective  Date,  duly executed (and with all schedules  thereto duly completed)
and delivered by the chief executive, financial or accounting Authorized Officer
of the Borrower,  and such Compliance  Certificate shall be satisfactory in form
and substance to the Administrative Agent.

      SUBPART III.1.5.  Documents Relating to Permitted Receivables Transaction.
The  Administrative  Agent  shall  have  received  (with  copies for each of the
Lenders) true and correct  executed  copies,  certified by the Borrower,  of the
Receivables  Purchase  Agreement and the Purchase and Sale Agreement relating to
the transactions  contemplated under the Permitted Receivables  Transaction (and
all  schedules,  exhibits  and  attachments  to  either  agreement),  all of the
foregoing  (including as to the expiration date, term,  conditions and structure
(including the legal and  organizational  structure of  Receivables  Co. and the
restrictions   imposed  on  its   activities)   of  the  Permitted   Receivables
Transaction) in form and substance reasonably satisfactory to the Administrative
Agent and each of the Lenders.

      SUBPART III.1.6.  Opinions of Counsel.  The Administrative Agent shall
                        -------------------
have received such opinions,  each dated the Eighth Amendment Effective Date, in
form and substance and from counsel  satisfactory to, and as may be required by,
the Administrative Agent and each of the Lenders.

      SUBPART III.1.7.  Reliance Letters.  The  Administrative  Agent shall have
received  reliance  letters,  dated  the  Eighth  Amendment  Effective  Date and
addressed to the Administrative Agent and each of the Lenders in respect of each
of the legal opinions delivered in connection with the transactions contemplated
under the Permitted Receivables Transaction.

      SUBPART  III.1.8.  Satisfactory  Legal  Form.  All  documents  executed or
submitted  pursuant  hereto shall be  satisfactory  in form and substance to the
Administrative  Agent and its counsel.  The Administrative Agent and its counsel
shall have  received  all  information  and such  counterpart  originals or such
certified or other copies of such materials,  as the Administrative Agent or its
counsel  may  reasonably  request,   and  all  legal  matters  incident  to  the
transactions  contemplated  by  this  Amendment  shall  be  satisfactory  to the
Administrative Agent and its counsel.

      SUBPART III.2. The amendments,  waivers and other modifications  contained
herein  relating  to Sierra  shall  become  effective  on the date (the  "Sierra
Acquisition  Effective  Date") when all of the  following  conditions  have been
satisfied to the satisfaction of the  Administrative  Agent (which date shall be
no later than the date of the closing of the Sierra Stock Purchase Agreement).

      SUBPART III.2.1.  Resolutions,  etc. The  Administrative  Agent shall have
received  (i) a copy of a good  standing  certificate,  dated a date  reasonably
close to the Sierra Acquisition  Effective Date, for Sierra and (ii) from Sierra
a certificate, dated a date reasonably close to the Sierra Acquisition Effective
Date, of its Secretary or Assistant Secretary as to:

            (a)  resolutions  of its Board of  Directors  then in full force and
      effect  authorizing  the execution,  delivery and performance of each Loan
      Document to be executed by Sierra;

            (b)  each Organic Document of Sierra; and

            (c)   the incumbency and signatures of the officers of Sierra
      authorized to act with respect to each Loan Document as is to be
      executed by it,

upon which  certificate  each Lender may  conclusively  rely until it shall have
received a further certificate of the Secretary or Assistant Secretary of Sierra
canceling or amending such prior certificate.

      SUBPART III.2.2.  Security Documents Relating to Sierra Acquisition,  etc.
The  Administrative  Agent shall have received fully executed  copies of each of
the  following  documents:  (a) a Supplement to the Borrower  Pledge  Agreement,
pursuant to which the Borrower shall pledge to the Administrative  Agent for the
benefit of the Lender  Parties,  inter alia, the capital stock of Sierra,  (b) a
Supplement  to the  Subsidiary  Guaranty,  pursuant to which Sierra shall become
party  to the  Subsidiary  Guaranty,  and  (c) a  Supplement  to the  Subsidiary
Security  Agreement,  pursuant  to  which  Sierra  shall  become  party  to  the
Subsidiary  Security  Agreement,  and,  as  applicable,  appropriate  trademark,
copyright  and patent  security  supplements  executed  by Sierra (in each case,
together  with all schedules  and annexes  referenced  therein) and (d) U.C.C.-1
Financing Statements naming Sierra as the debtor and the Administrative Agent as
the secured party,  suitable for filing under the U.C.C. of all jurisdictions as
may be necessary  or, in the  reasonable  opinion of the  Administrative  Agent,
desirable to perfect the first priority security interest of the  Administrative
Agent.  The  Administrative  Agent shall have also received  certified copies of
Uniform  Commercial  Code Requests for  Information or Copies (Form  U.C.C.-11),
certified  by the  Borrower,  dated a date  reasonably  near (but  prior to) the
Sierra  Acquisition  Effective Date of Sierra,  listing all effective  financing
statements, tax liens and judgment liens which name Sierra as the debtor.

      SUBPART  III.2.3.  Real Estate Documents  Relating to Sierra  Acquisition,
etc. The Administrative  Agent shall have received fully executed copies of each
of the following documents,  each in form and substance reasonably  satisfactory
to the Administrative  Agent, or shall have received  evidence,  satisfactory to
the  Administrative  Agent, of the Borrower's or any other Obligor's  compliance
with each of the following conditions:

            (a) a real estate mortgage (the "Sierra Mortgage"), substantially in
      the form of Exhibit J to the Existing Credit Agreement, encumbering all of
      Sierra's  right,  title and interest in and to that certain real  property
      owned by Sierra and located in  Litchfield,  Illinois  (the  "Illinois Fee
      Property";  the Illinois Fee Property,  the Illinois  Leased  Property (as
      defined  below) and the property  leased by Sierra  located in Clearwater,
      Florida are  sometimes  hereinafter  referred to as the "Real  Property"),
      together with (i) evidence of the completion of all recordings and filings
      of the Sierra  Mortgage  (and  related  U.C.C.  financing  statements  and
      fixture   filings)  as  may  be  necessary  or,  in  the  opinion  of  the
      Administrative  Agent,  desirable  to  effectively  create  a valid  first
      priority  mortgage  Lien  against the  Illinois Fee Property and (ii) such
      other  approvals,  opinions or  documents in  connection  therewith as the
      Administrative Agent may reasonably request;

            (b)  a  First  Amendment  to  the  Sierra  Mortgage  (the  "Mortgage
      Amendment"), which Mortgage Amendment shall, upon its recordation,  spread
      the Lien of the Sierra  Mortgage to encumber  that certain  parcel of land
      and the improvements located thereon situated in Litchfield, Illinois (the
      "Illinois Leased  Property"),  which Illinois Leased Property is presently
      owned by The City of Litchfield  Illinois and leased to Sierra pursuant to
      that certain Lease Agreement,  dated as of December 1, 1976 (the "Illinois
      Lease") and forms a part of and is  contiguous  to the  manufacturing  and
      warehouse facilities located on the Illinois Fee Property.

            (c)  a  mortgagees'  title  insurance  policy  satisfactory  to  the
      Administrative Agent and from an independent title insurer satisfactory to
      the  Administrative  Agent  (the  "Title  Insurer"),  with  respect to the
      Illinois Fee  Property,  insuring that title to such Illinois Fee Property
      is  marketable  and that the  interests  created  by the  Sierra  Mortgage
      constitute valid first priority Lien thereon free and clear of all defects
      and  encumbrances,  and such  other  matters  reasonably  approved  by the
      Administrative  Agent,  and such  policies  shall also include a revolving
      credit endorsement,  comprehensive endorsement, variable rate endorsement,
      zoning endorsements (with parking),  access and utilities endorsements,  a
      mechanic's   lien   endorsement   and  such  other   endorsements  as  the
      Administrative Agent shall reasonably request;

            (d) an "as  built"  survey  for  each  parcel  of the  Illinois  Fee
      Property and the Illinois Leased  Property,  certified to and satisfactory
      to the Administrative Agent and the Title Insurer by a surveyor reasonably
      satisfactory  to the  Administrative  Agent and registered in the state of
      Illinois,  which  survey shall (i) be of recent  date,  in the  reasonable
      judgment of the Administrative  Agent, (ii) contain the minimum detail for
      land surveys as most recently adopted by ALTA/ACSM,  (iii) comply with the
      Administrative Agent's survey requirements, (iv) show a "metes and bounds"
      and/or   "block  and  lot"  legal   description   and  (v)   contain   the
      Administrative  Agent's standard form  certification to the Administrative
      Agent and the Title Insurer;

            (e)  Phase  One  Environmental   Site  Assessments  (the  scope  and
      performance  of which meets or exceeds the then most current ASTM Standard
      Practice for Environmental Site Assessments:  Phase One Environmental Site
      Assessment Process, E 1527) of each parcel of Real Property and such other
      reports and other information,  in form, scope and substance  satisfactory
      to the Administrative  Agent regarding  environmental  matters relating to
      Sierra  and  each  parcel  of  Real  Property,  which  environmental  site
      assessments  shall (by their terms or  pursuant  to a separate  agreement)
      expressly permit the Administrative Agent and the Lenders to rely thereon;

            (f) copies of any lease or other rental or occupancy agreements (the
      "Leases"), certified to the Administrative Agent, with respect to any Real
      Property or any portion  thereof under which  Sierra,  the Borrower or any
      other Obligor is either the lessee or the lessor;

            (g) Subordination,  Non-Disturbance  and Attornment  Agreements,  in
      form and substance  reasonably  satisfactory to the Administrative  Agent,
      with  respect to any Lease  encumbering  a parcel of Real  Property  under
      which Sierra, the Borrower or any other Obligor is the lessor;

            (h) Landlord  Waiver and Consent  Agreements,  in form and substance
      reasonably  satisfactory to the Administrative  Agent, with respect to any
      Lease  encumbering  the  Illinois  Fee Property  under which  Sierra,  the
      Borrower or any other Obligor is the lessee;

            (i) an opinion of counsel to the  Borrower  in the state of Illinois
      as to the  enforceability  of the  Sierra  Mortgage  and each  other  Loan
      Document  which  creates or  perfects a security  interest  and such other
      matters as the Administrative Agent may require; and

            (j)  evidence of payment in full by the  Borrower  of all  premiums,
      title examination,  survey,  departmental violations,  judgment and U.C.C.
      search  charges,  mortgage  recording  taxes  and fees,  and other  taxes,
      charges  and fees  payable in  connection  with the  issuance of any title
      insurance policy,  the recording of any Sierra Mortgage or the delivery of
      any survey or environmental report required under this Subpart 3.1.5.

      SUBPART III.2.4.  Opinions of Counsel.  The Administrative Agent shall
                        -------------------
have received such opinions,  each dated the Sierra Acquisition  Effective Date,
in form and substance and from counsel  satisfactory  to, and as may be required
by, the Administrative Agent and each of the Lenders.

      SUBPART  III.2.5.  Satisfactory  Legal  Form.  All  documents  executed or
submitted  pursuant  hereto shall be  satisfactory  in form and substance to the
Administrative  Agent and its counsel.  The Administrative Agent and its counsel
shall have  received  all  information  and such  counterpart  originals or such
certified or other copies of such materials,  as the Administrative Agent or its
counsel  may  reasonably  request,   and  all  legal  matters  incident  to  the
transactions  contemplated  by  this  Amendment  shall  be  satisfactory  to the
Administrative Agent and its counsel.

                                     PART IV

                         REPRESENTATIONS AND WARRANTIES

      In order to  induce  the  Lenders  and the  Issuers  to  enter  into  this
Amendment,   the  Borrower  and  the  Parent   represent   and  warrant  to  the
Administrative Agent, each Issuer and each Lender as set forth in this Part.

      SUBPART IV.1. Compliance with Warranties. After giving effect to the terms
of this Amendment,  (a) the  representations and warranties set forth herein, in
Article VI of the Credit  Agreement and in each other Loan Document are true and
correct in all  material  respects  with the same effect as if made on and as of
the date hereof  (unless  stated to relate  solely to an earlier  date, in which
case they were true and correct as of such  earlier  date) and (b) the  Borrower
shall be in full compliance with Article 4 of the Subordinated Note Indenture.

      SUBPART IV.2. Due  Authorization,  Non-Contravention,  etc. The execution,
delivery and  performance  by the Borrower and the Parent of this  Amendment and
other  documents  delivered  pursuant  hereto are within the  Borrower's and the
Parent's corporate powers,  have been duly authorized by all necessary corporate
action,  and do not (i) contravene either the Borrower's or the Parent's Organic
Documents,  (ii)  contravene  or  result  in a  default  under  any  contractual
restriction,  law or governmental regulation or court decree or order binding on
or affecting  either the Borrower or the Parent,  or (iii) result in, or require
the creation or imposition of, any Lien (except as contemplated in or created by
the Loan Documents).

      SUBPART IV.3.  Validity,  etc.  This  Amendment has been duly executed and
delivered by the Borrower and the Parent and  constitutes  the legal,  valid and
binding obligation of the Borrower and the Parent enforceable in accordance with
its terms, subject as to enforcement to bankruptcy, insolvency,  reorganization,
moratorium or other similar laws affecting  creditors'  rights  generally and to
general principles of equity,  regardless of whether  enforcement is sought in a
proceeding at law or in equity.

      SUBPART IV.4.  Compliance With Existing Credit Agreement.  As of the
                     -----------------------------------------
Eighth  Amendment  Effective  Date,  both before and after giving  effect to the
terms of this Amendment, no Default has occurred and is continuing.

                                     PART V

                            MISCELLANEOUS PROVISIONS

      SUBPART  V.1.   Ratification  of  and  Limited  Amendment  to  the  Credit
Agreement. The Existing Credit Agreement, as amended hereby, is hereby ratified,
approved and confirmed in each and every respect by the parties  hereto.  Except
as specifically  amended or modified  herein,  the Existing Credit Agreement and
the other Loan  Documents  shall continue in full force and effect in accordance
with the  provisions  thereof  and  except as  expressly  set forth  herein  the
provisions hereof shall not operate as a waiver or amendment of any right, power
or privilege of the Administrative  Agent and the Lenders nor shall the entering
into of this  Amendment  preclude  the Lenders  from  refusing to enter into any
further or future amendments.

      SECTION  V.2.  Consent  and  Acknowledgment  of  Guarantors,  etc.  By its
signature  below,  the Parent,  in its capacity as a guarantor and as grantor of
collateral security under certain Loan Documents, hereby acknowledges,  consents
and agrees to this  Amendment and hereby  ratifies and confirms its  obligations
under its guaranty and each Loan  Document  executed and  delivered by it in all
respects.

      SUBPART V.3.  Credit  Agreement,  References,  etc. All  references to the
Credit Agreement in any other document,  instrument,  agreement or writing shall
hereafter be deemed to refer to the Existing Credit Agreement as amended hereby.
As used in the Credit Agreement, the terms "Agreement", "herein", "hereinafter",
"hereunder", "hereto" and words of similar import shall mean, from and after the
date hereof, the Existing Credit Agreement as amended by this Amendment.

      SUBPART V.4.  Expenses.  The Borrower agrees to pay all out-of-pocket
                    --------
expenses  incurred by the  Administrative  Agent (including fees and expenses of
counsel  to the  Administrative  Agent)  in  connection  with  the  preparation,
negotiation, execution and delivery of this Amendment.

      SUBPART  V.5.  Headings;   Counterparts.  The  various  headings  of  this
Amendment are inserted for convenience  only and shall not affect the meaning or
interpretation of this Amendment or any provisions hereof. This Amendment may be
signed  in any  number  of  separate  counterparts,  each of  which  shall be an
original, and all of which taken together shall constitute one instrument.

      SUBPART V.6.  Governing Law;  Entire  Agreement.  THIS AMENDMENT  SHALL BE
DEEMED TO BE A CONTRACT  MADE UNDER AND GOVERNED BY THE LAWS OF THE STATE OF NEW
YORK.  This Amendment  constitutes  the entire  understanding  among the parties
hereto  with  respect to the  subject  matter  hereof and  supersedes  any prior
agreements, written or oral, with respect thereto.

      SUBPART V.7.  Loan Document Pursuant to Credit Agreement.  This
                    ------------------------------------------
Amendment is a Loan Document executed pursuant to the Credit Agreement and shall
be construed,  administered  and applied in accordance with all of the terms and
provisions of the Credit Agreement.

      IN WITNESS  WHEREOF,  the parties  hereto have caused this Amendment to be
executed by their  respective  officers  thereunto duly authorized as of the day
and year first above written.RECEIVABLES PURCHASE AGREEMENT

                        dated as of November 29, 1999

                                      among

                            IMO FUNDING COMPANY, LLC

                             IMO INDUSTRIES INC.

                         LIBERTY STREET FUNDING CORP.

                                       and

                             THE BANK OF NOVA SCOTIA

                                TABLE OF CONTENTS

||

                ARTICLE I. AMOUNTS AND TERMS OF THE PURCHASES
Section 1.1.      Purchase Facility 1
Section 1.2.      Making Purchases  2
Section 1.3.      Purchased Interest Computation      3
Section 1.4.      Settlement Procedures   3
Section 1.5.      Fees  9
Section 1.6.      Payments and Computations, Etc      9
Section 1.7.      Increased Costs   10
Section 1.8.      Requirements of Law     11
Section 1.9.      Inability to Determine Eurodollar Rate    12

                 ARTICLE II. REPRESENTATIONS AND WARRANTIES;
                          COVENANTS; TERMINATION EVENTS

Section 2.1.      Representations and Warranties; Covenants 13
Section 2.2.      Termination Events      13

                         ARTICLE III. INDEMNIFICATION
Section 3.1.      Indemnities by the Seller     13
Section 3.2.      Indemnities by the Servicer   16

                  ARTICLE IV. ADMINISTRATION AND COLLECTIONS
Section 4.1.      Appointment of the Servicer   17
Section 4.2.      Duties of the Servicer  18
Section 4.3.      Establishment and Use of Certain Accounts 19
Section 4.4.      Enforcement Rights      20
Section 4.5.      Responsibilities of the Seller      21
Section 4.6.      Servicing Fee     22

                           ARTICLE V. MISCELLANEOUS
Section 5.1.      Amendments, Etc.  22
Section 5.2.      Notices, Etc      23
Section 5.3.      Assignability     23
Section 5.4.      Costs, Expenses and Taxes     24
Section 5.5.      No Proceedings; Limitation on Payments    25
Section 5.6.      Confidentiality   25
Section 5.7.      GOVERNING LAW AND JURISDICTION      26
Section 5.8.      Execution in Counterparts     26
Section 5.9.      Survival of Termination 26
Section 5.10.     WAIVER OF JURY TRIAL    26
Section 5.11.     Entire Agreement  27
Section 5.12.     Headings    27
Section 5.13.     Issuer's Liabilities    27

EXHIBIT I         Definitions
EXHIBIT II  Conditions of Purchases
EXHIBIT III Representations and Warranties
EXHIBIT IV  Covenants
EXHIBIT V         Termination Events

SCHEDULE I  Credit and Collection Policy
SCHEDULE II Lock-box Banks and Lock-box Accounts
SCHEDULE III      Trade Names

ANNEX A           Form of Monthly Report
ANNEX B           Form of Purchase Notice

      This RECEIVABLES PURCHASE AGREEMENT (as amended, supplemented or otherwise
modified from time to time, this "Agreement") is entered into as of November 29,
1999, among IMO FUNDING COMPANY,  LLC, a Delaware limited liability company,  as
seller (the "Seller"),  IMO INDUSTRIES INC., a Delaware  corporation ("IMO"), as
initial  servicer (in such capacity,  together with its successors and permitted
assigns in such  capacity,  the  "Servicer"),  LIBERTY  STREET  FUNDING CORP., a
Delaware  corporation  (together with its successors and permitted assigns,  the
"Issuer"), and THE BANK OF NOVA SCOTIA, a Canadian chartered bank acting through
its New York Agency ("BNS"),  as administrator (in such capacity,  together with
its successors and assigns in such capacity, the "Administrator").

      PRELIMINARY  STATEMENTS.  Certain  terms  that  are  capitalized  and used
throughout  this Agreement are defined in Exhibit I.  References in the Exhibits
hereto to the "Agreement" refer to this Agreement,  as amended,  supplemented or
otherwise modified from time to time.

      The Seller  desires to sell,  transfer  and assign an  undivided  variable
percentage interest in a pool of receivables,  and the Issuer desires to acquire
such undivided variable percentage  interest,  as such percentage interest shall
be adjusted  from time to time based upon,  in part,  reinvestments  made by the
Issuer.

      In  consideration  of the  mutual  agreements,  provisions  and  covenants
contained herein, the parties hereto agree as follows:

I.                                    ARTICLE
                       AMOUNTS AND TERMS OF THE PURCHASES

1. Section Purchase Facility. On the terms and conditions hereinafter set forth,
the Issuer  hereby  agrees  subject to the next  sentence to purchase,  and make
reinvestments in, undivided  percentage  ownership  interests up to the Purchase
Limit with regard to the  Purchased  Interest  from the Seller from time to time
from the date hereof to the Facility  Termination  Date.  Under no circumstances
shall the Issuer make any such purchase or reinvestment  if, after giving effect
to such  purchase or  reinvestment,  the  aggregate  outstanding  Capital of the
Purchased Interest would exceed the Purchase Limit.

1. The Seller may, upon at least 30 days' written  notice to the  Administrator,
terminate in whole or reduce in part the unused  portion of the Purchase  Limit;
provided,  that  each  partial  reduction  shall  be in the  amount  of at least
$5,000,000,  or an integral multiple of $1,000,000 in excess thereof,  and that,
unless  terminated  in whole,  the  Purchase  Limit shall in no event be reduced
below $15,000,000.

1. Section Making  Purchases.  Each purchase (but not reinvestment) of undivided
percentage  ownership  interests with regard to the Purchased Interest hereunder
shall be made upon the Seller's  irrevocable written notice in the form of Annex
B delivered to the  Administrator  in accordance  with Section 5.2 (which notice
must be received by the Administrator before 11:00 a.m., New York City time): at
least two Business Days before the requested  purchase date,  which notice shall
specify:  (A) the amount requested to be paid to the Seller (such amount,  which
shall not be less than $250,000,  being the "Capital"  relating to the undivided
percentage  ownership  interest then being purchased),  and (B) the date of such
purchase (which shall be a Business Day).

1. On the date of each purchase (but not  reinvestment) of undivided  percentage
ownership interests with regard to the Purchased Interest hereunder,  the Issuer
shall, upon  satisfaction of the applicable  conditions set forth in Exhibit II,
make  available  to the  Seller in same day  funds,  at Bank of  America,  N.A.,
account number  3751450511,  ABA  111000012,  an amount equal to the Capital (as
specified  by the Seller  pursuant  to Section  1.2(a)  above)  relating  to the
undivided percentage ownership interest then being purchased.

1.  Effective  on the date of each  purchase  pursuant to this  Section and each
reinvestment pursuant to Section 1.4, the Seller hereby sells and assigns to the
Issuer an undivided  percentage  ownership interest in: (i) each Pool Receivable
then existing,  (ii) all Related Security with respect to such Pool Receivables,
and (iii) all  Collections  with  respect to, and other  proceeds  of, such Pool
Receivables and Related Security.

1. To secure all of the Seller's obligations  (monetary or otherwise) under this
Agreement and the other  Transaction  Documents to which it is a party,  whether
now or hereafter existing or arising,  due or to become due, direct or indirect,
absolute  or  contingent,  the  Seller  hereby  grants to the  Issuer a security
interest  in all of the  Seller's  right,  title  and  interest  (including  any
undivided interest of the Seller) in, to and under all of the following, whether
now or hereafter owned, existing or arising: (i) all Pool Receivables,  (ii) all
Related  Security with respect to such Pool  Receivables,  (iii) all Collections
with  respect  to such Pool  Receivables,  (iv) the  Lock-Box  Accounts  and the
Collection Account, and all amounts on deposit therein, and all certificates and
instruments, if any, from time to time evidencing such Lock-Box Accounts and the
Collection Account,  and amounts on deposit therein, (v) all rights (but none of
the  obligations) of the Seller under the Purchase and Sale Agreement,  and (vi)
all proceeds of, and all amounts received or receivable under any or all of, the
foregoing (collectively, the "Pool Assets"). The Issuer shall have, with respect
to the Pool  Assets,  and in  addition  to all the  other  rights  and  remedies
available to the Issuer,  all the rights and  remedies of a secured  party under
any applicable UCC.

A. Section  Purchased  Interest  Computation.  The Purchased  Interest  shall be
initially  computed on the date of the initial purchase  hereunder.  Thereafter,
until  the  Facility   Termination   Date,  the  Purchased   Interest  shall  be
automatically recomputed (or deemed to be recomputed) on each Business Day other
than  a  Termination  Day.  The  Purchased   Interest  as  computed  (or  deemed
recomputed) as of the day before the Facility  Termination Date shall thereafter
remain  constant.  The  Purchased  Interest  shall  become zero when the Capital
thereof and Discount  thereon shall have been paid in full, all the amounts owed
by the Seller and the Servicer  hereunder to the Issuer,  the  Administrator and
any  other  Indemnified  Party or  Affected  Person  are  paid in full,  and the
Servicer shall have received the accrued Servicing Fee thereon.

1. Section Settlement  Procedures.  The collection of the Pool Receivables shall
be administered  by the Servicer in accordance  with this Agreement.  The Seller
shall provide to the Servicer on a timely basis all information  needed for such
administration,  including  notice of the occurrence of any  Termination Day and
current computations of the Purchased Interest.

1.  The  Servicer  shall,  on each  Business  Day on which  Collections  of Pool
Receivables  are  received by the Seller or Servicer or are  deposited  into the
Lock-Box  Accounts,   transfer  such  Collections  therefrom  and  deposit  such
Collections  into the Collection  Account.  With respect to such  Collections on
such  day and with  respect  to any  Collection  transferred  to the  Collection
Account  on such day  pursuant  to the last  paragraph  of Section  1.4(e),  the
Servicer shall:

a) set aside and hold in the  Collection  Account for the benefit of the Issuer,
out of the percentage of such Collections represented by the Purchased Interest,
first an amount equal to the Discount  accrued through such day for each Portion
of Capital and not previously  transferred,  second, an amount equal to the fees
set forth in the Fee Letter accrued through such day for the Purchased  Interest
and not  previously  transferred,  and third,  to the extent funds are available
therefor,  an amount equal to the Issuer's  Share of the  Servicing  Fee accrued
through such day and not previously transferred; and

a) subject to Section 1.4(f), if such day is not a Termination Day, remit to the
Seller,  on  behalf of the  Issuer,  the  remainder  of the  percentage  of such
Collections, represented by the Purchased Interest, to the extent representing a
return on the Capital;  such Collections  shall be  automatically  reinvested in
Pool Receivables, and in the Related Security and Collections and other proceeds
with  respect  thereto,  and  the  Purchased  Interest  shall  be  automatically
recomputed pursuant to Section 1.3; it being understood, that prior to remitting
to the Seller the remainder of such  Collections by way of  reinvestment in Pool
Receivables,  the Servicer shall have calculated the Purchased  Interest on such
day,  and if such  Purchased  Interest  shall  exceed  100% on  such  day,  such
Collections  shall not be remitted to the Seller but shall be set aside and held
in the  Collection  Account  for the  benefit of the Issuer in  accordance  with
paragraph (iii) below;

a) if  such  day is a  Termination  Day (or if such  day is a day on  which  the
Purchased  Interest  exceeds  100%),  (A) set aside  and hold in the  Collection
Account for the benefit of the Issuer the entire  remainder of the percentage of
the Collections  represented by the Purchased Interest (or such amount set forth
in paragraph (ii) above); provided that so long as the Facility Termination Date
has not  occurred  if any amounts  are so set aside on any  Termination  Day and
thereafter, the conditions set forth in Section 2 of Exhibit II are satisfied or
are waived by the Administrator, such previously set aside amounts shall, to the
extent  representing a return on the Capital,  be reinvested in accordance  with
the  preceding  paragraph  (ii) on the day of such  subsequent  satisfaction  or
waiver of conditions,  and (B) set aside and hold in the Collection  Account for
the  benefit  of the  Issuer  the entire  remainder  of the  Collections  in the
Collection Account represented by the Seller's Share of the Collections, if any;
provided that so long as the Facility  Termination  Date has not occurred if any
amounts are so set aside on any Termination  Day and thereafter,  the conditions
set  forth in  Section  2 of  Exhibit  II are  satisfied  or are  waived  by the
Administrator,  such  previously  set aside amounts shall be  distributed to the
Seller on the day of such subsequent satisfaction or waiver of conditions; and

a) during the times when amounts are  required to be  reinvested  in  accordance
with the foregoing paragraph (ii) or the proviso to paragraph (iii),  release to
the Seller  (subject to Section  1.4(f)) for its own account any  Collections in
excess of (x) such amounts, (y) the amounts that are required to be set aside in
the Collection  Account pursuant to paragraph (i) above and (z) in the event the
Seller is not the Servicer,  all reasonable and appropriate  out-of-pocket costs
and expenses  (including  the Servicing Fee to the extent such Servicing Fee has
not  already  been  paid)  of  such  Servicer  of  servicing,   collecting   and
administering the Pool Receivables.

1.                The Servicer shall deposit into the  Administration  Account
(or such other account  designated by the  Administrator),  on each Settlement
Date:

a)                Collections  held on deposit in the  Collection  Account for
the benefit of the Issuer pursuant to Section  1.4(b)(i) in respect of accrued
Discount and accrued and unpaid Fees;

a)            Collections  held on deposit in the  Collection  Account for the
benefit of the Issuer pursuant to Section 1.4(f); and

a) the  lesser of (x) the  amount of  Collections  then held on  deposit  in the
Collection Account for the benefit of the Issuer pursuant to Section 1.4(b)(iii)
and (y) the aggregate amount of Capital on such date.

The Servicer shall deposit to its own account from  Collections  held on deposit
in the  Collection  Account  pursuant  to  Section  1.4(b)(i)  in respect of the
accrued Servicing Fee, an amount equal to such accrued Servicing Fee.

1. Upon receipt of funds deposited into the  Administration  Account pursuant to
clause  (c),  the  Administrator  shall  cause such funds to be  distributed  as
follows:

a) if such  distribution  occurs on a day that is not a Termination  Day and the
Purchased  Interest does not exceed 100%, first to the Issuer in payment in full
of all accrued  Discount with respect to each Portion of Capital and accrued and
unpaid Fees, and second, if the Servicer has set aside amounts in respect of the
Servicing  Fee  pursuant  to clause  (b)(i) and has not  retained  such  amounts
pursuant to clause (c), to the Servicer  (payable in arrears on each  Settlement
Date) in payment in full of the Issuer's Share of accrued  Servicing Fees so set
aside, and

a) if  such  distribution  occurs  on a  Termination  Day or on a day  when  the
Purchased  Interest  exceeds 100%, first to the Issuer in payment in full of all
accrued  Discount with respect to each Portion of Capital and accrued and unpaid
Fees, second to the Issuer in payment in full of Capital (or, if such day is not
a  Termination  Day, the amount  necessary to reduce the  Purchased  Interest to
100%),  third,  if IMO or an  Affiliate  thereof  is not  the  Servicer,  to the
Servicer in payment in full of the Issuer's Share of all accrued Servicing Fees,
fourth,  if the Capital and accrued  Discount  with  respect to each  Portion of
Capital have been reduced to zero, and all accrued Servicing Fees payable to the
Servicer (if other than IMO or an Affiliate  thereof) have been paid in full, to
the Issuer, the Administrator and any other Indemnified Party or Affected Person
in payment in full of any other  amounts  owed  thereto by the Seller under this
Agreement  and,  fifth,  unless  such amount has been  retained by the  Servicer
pursuant to clause (c), to the  Servicer (if the Servicer is IMO or an Affiliate
thereof) in payment in full of the Issuer's Share of all accrued Servicing Fees.

After the Capital,  Discount,  and Fees with respect to the Purchased  Interest,
Servicing  Fees, and any other amounts payable by the Seller and the Servicer to
the Issuer,  the Administrator or any other Indemnified Party or Affected Person
hereunder,  have been paid in full, all additional  Collections  with respect to
the Purchased Interest shall be paid to the Seller for its own account.

1.           For the purposes of this Section 1.4:

a) if on any day the  Outstanding  Balance of any Pool  Receivable is reduced or
adjusted  as a result  of any  defective,  rejected,  returned,  repossessed  or
foreclosed goods or services, or any revision, cancellation, allowance, discount
or other  adjustment  made by any  Originator,  the Servicer,  the Seller or any
Affiliate of the Seller,  or any setoff or dispute between any  Originator,  the
Seller or any Affiliate of the Seller and an Obligor, the Seller shall be deemed
to have received on such day a Collection of such Pool  Receivable in the amount
of such reduction or adjustment;

a) if on any day any of the  representations or warranties in Section 1(g)or (m)
of Exhibit III is not true with respect to any Pool Receivable, the Seller shall
be deemed to have received on such day a Collection  of such Pool  Receivable in
full  (Collections  deemed to have been received pursuant to clause (i) and (ii)
of  this  paragraph  (e)  are  hereinafter  sometimes  referred  to  as  "Deemed
Collections");

a) except as otherwise required by applicable law or the relevant Contract,  all
Collections  received from an Obligor of any Receivable  shall be applied to the
Receivables  of such  Obligor  in the  order  of the  age of  such  Receivables,
starting  with the oldest such  Receivable,  unless such Obligor  designates  in
writing its payment for application to specific Receivables; and

a) if and to the extent the  Administrator  or the Issuer  shall be required for
any reason to pay over to an Obligor (or any  trustee,  receiver,  custodian  or
similar  official  pursuant to an Event of Bankruptcy) any amount received by it
hereunder,  such  amount  shall be deemed  not to have been so  received  by the
Administrator  or the Issuer but rather to have been retained by the Seller and,
accordingly,  the  Administrator or the Issuer, as the case may be, shall have a
claim  against the Seller for such  amount,  payable when and to the extent that
any distribution from or on behalf of such Obligor is made in respect thereof.

On or before the last day of each  Reporting  Period that  contains  one or more
days on which Seller is deemed to have  received a  Collection  pursuant to this
Section 1.4(e), Seller shall transfer an amount equal to the aggregate amount of
such  Deemed  Collections  to the  Collection  Account  and the  Servicer  shall
distribute such transferred amount in the manner set forth in Section 1.4(c), as
if such  transferred  amount actually had been received by Seller or Servicer on
the date of such transfer from the Obligors of such Pool  Receivables  and as if
such  transferred  amount  actually had been deposited into a Lockbox Account on
the date of such transfer.

1. If at any time the Seller shall wish to cause the reduction of Capital of the
Purchased  Interest (but not to commence the liquidation,  or reduction to zero,
of the  entire  Capital  of the  Purchased  Interest),  the  Seller may do so as
follows:

a) the  Seller  shall  give the  Administrator  and the  Servicer  at least  two
Business  Days'  prior  written  notice  thereof  (including  the amount of such
proposed reduction and the proposed date on which such reduction will commence);

a) on the  proposed  date of  commencement  of such  reduction  and on each  day
thereafter,  the Servicer shall cause Collections not to be reinvested until the
amount  thereof not so reinvested  shall equal the desired  amount of reduction;
and

a) the Servicer shall hold such  Collections  in the Collection  Account for the
benefit of the Issuer,  for payment to the  Administrator on the next Settlement
Date immediately following the current Settlement Period, and the Capital of the
Purchased  Interest  shall be  deemed  reduced  in the  amount to be paid to the
Administrator only when in fact finally so paid;

provided, that:

            (A)  the  amount  of any  such  reduction  shall  be not  less  than
      $5,000,000 and shall be an integral multiple of $1,000,000, and the entire
      Capital of the Purchased  Interest after giving effect to such  reduction,
      if not reduced to zero,  shall be not less than $5,000,000 and shall be in
      an integral multiple of $1,000,000; and

            (B) the Seller  shall  choose a  reduction  amount,  and the date of
      commencement  thereof,  so that to the extent  practicable  such reduction
      shall commence and conclude in the same Settlement Period.

A.          Section Fees.  The Seller shall pay to the  Administrator  certain
fees in the  amounts  and on the dates  set forth in a letter,  dated the date
hereof,  among the Servicer,  the Seller and the Administrator (as such letter
agreement  may be amended,  supplemented  or otherwise  modified  from time to
time, the "Fee Letter").

1. Section Payments and  Computations,  Etc. All amounts to be paid or deposited
by the Seller or the  Servicer  hereunder  shall be made without  reduction  for
offset or  counterclaim  and shall be paid or  deposited no later than noon (New
York  City  time) on the day when  due in same day  funds to the  Administration
Account.  All amounts received after noon (New York City time) will be deemed to
have been received on the next Business Day.

1.  The  Seller  or the  Servicer,  as the  case may be,  shall,  to the  extent
permitted by law, pay interest on any amount not paid or deposited by the Seller
or the  Servicer,  as the case may be, when due  hereunder,  at an interest rate
equal to 1.0% per annum above the Base Rate, payable on demand.

1. All  computations  of  interest  under  clause  (b) and all  computations  of
Discount,  fees and other amounts hereunder shall be made on the basis of a year
of 360 (or 365 or 366, as applicable,  with respect to Discount or other amounts
calculated  by  reference  to the Base Rate) days for the actual  number of days
elapsed.  Whenever any payment or deposit to be made hereunder shall be due on a
day other than a Business Day, such payment or deposit shall be made on the next
Business Day and such extension of time shall be included in the  computation of
such payment or deposit.

1. Section Increased Costs. If the Administrator, the Issuer, any Purchaser, any
other Program Support  Provider or any of their  respective  Affiliates (each an
"Affected  Person")  reasonably  determines  that the existence of or compliance
with: (i) any law or regulation or any change  therein or in the  interpretation
or application thereof, in each case adopted, issued or occurring after the date
hereof,  or (ii) any request,  guideline  or directive  from any central bank or
other Governmental  Authority (whether or not having the force of law) issued or
occurring after the date of this  Agreement,  affects or would affect the amount
of capital  required or expected to be maintained by such Affected  Person,  and
such Affected Person  determines that the amount of such capital is increased by
or based upon the existence of any commitment to make purchases of (or otherwise
to maintain the investment in) Pool Receivables related to this Agreement or any
related liquidity facility, credit enhancement facility and other commitments of
the same type, then, upon written demand by such Affected Person (with a copy to
the Administrator),  the Seller shall promptly pay to the Administrator, for the
account of such Affected Person, from time to time as specified by such Affected
Person,  additional  amounts  reasonably  sufficient to compensate such Affected
Person.  A certificate  describing in  reasonable  detail,  such amounts and the
basis for such Affected Person's demand for such amounts submitted to the Seller
and the  Administrator  by such Affected  Person shall be conclusive and binding
for all purposes, absent manifest error.

1.  If,  due to  either:  (i) the  introduction  of or any  change  in or in the
interpretation of any law or regulation  occurring after the date hereof or (ii)
compliance  with any guideline or request  occurring  after the date hereof from
any  central  bank or other  Governmental  Authority  (whether or not having the
force of law), there shall be any increase in the cost to any Affected Person of
agreeing  to  purchase or  purchasing,  or  maintaining  the  ownership  of, the
Purchased  Interest in respect of which Discount is computed by reference to the
Eurodollar Rate,  then, upon written demand by such Affected Person,  the Seller
shall  promptly pay to such Affected  Person,  from time to time as specified by
such Affected Person,  additional  amounts  reasonably  sufficient to compensate
such Affected  Person for such  increased  costs.  A  certificate  describing in
reasonable detail,  such amounts and the basis for such Affected Person's demand
for such amounts  submitted to the Seller and the Administrator by such Affected
Person shall be conclusive and binding for all purposes, absent manifest error.

      (c) In  determining  the  additional  amounts  necessary to  compensate an
Affected  Person  pursuant to clause (a) or (b) above,  such Affected Person may
use any reasonably  method of averaging and attribution that it (in its sole and
absolute discretion) shall deem applicable.

A. Section  Requirements  of Law. If any Affected Person  reasonably  determines
that the  existence of or  compliance  with:  (a) any law or  regulation  or any
change therein or in the  interpretation  or application  thereof,  in each case
adopted,  issued  or  occurring  after  the  date  hereof,  or (b) any  request,
guideline or directive  from any central  bank or other  Governmental  Authority
(whether or not having the force of law) issued or  occurring  after the date of
this Agreement:

            (i) does or shall  subject  such  Affected  Person to any tax of any
      kind  whatsoever  with  respect to this  Agreement,  any  increase  in the
      Purchased  Interest or in the amount of Capital relating thereto,  or does
      or shall change the basis of taxation of payments to such Affected  Person
      on account of Collections, Discount or any other amounts payable hereunder
      (excluding  taxes  imposed  on the  overall  pre-tax  net  income  of such
      Affected  Person,  franchise  taxes imposed on such Affected Person by the
      jurisdiction under the laws of which such Affected Party is organized or a
      political subdivision thereof),

            (ii) does or shall impose,  modify or hold  applicable  any reserve,
      special  deposit,  compulsory loan or similar  requirement  against assets
      held by,  or  deposits  or other  liabilities  in or for the  account  of,
      purchases, advances or loans by, or other credit extended by, or any other
      acquisition  of funds by, any office of such Affected  Person that are not
      otherwise included in the determination of the Eurodollar Rate or the Base
      Rate hereunder, or

            (iii)  does or shall  impose  on such  Affected  Person  any other
      condition,

and the  result of any of the  foregoing  is: (A) to  increase  the cost to such
Affected  Person of acting as  Administrator,  or of  agreeing  to  purchase  or
purchasing  or  maintaining  the  ownership  of undivided  percentage  ownership
interests  with regard to the Purchased  Interest (or interests  therein) or any
Portion of Capital,  or (B) to reduce any amount receivable  hereunder  (whether
directly or  indirectly),  then, in any such case,  upon written  demand by such
Affected  Person,  the  Seller  shall  promptly  pay  to  such  Affected  Person
additional amounts  reasonably  necessary to compensate such Affected Person for
such  additional  cost or reduced amount  receivable.  All such amounts shall be
payable as  incurred.  A  certificate  from such  Affected  Person to the Seller
describing  in  reasonable  detail  the  amount and basis for the amount of such
additional  costs or reduced amount  receivable  shall be conclusive and binding
for all purposes, absent manifest error.

A. Section Inability to Determine  Eurodollar Rate. If the  Administrator  shall
have  determined   before  the  first  day  of  any  Settlement   Period  (which
determination  shall be  conclusive  and binding  upon the parties  hereto),  by
reason of circumstances  affecting the interbank Eurodollar market, either that:
(a) dollar  deposits in the  relevant  amounts and for the  relevant  Settlement
Period are not  available,  (b) adequate and  reasonable  means do not exist for
ascertaining  the  Eurodollar  Rate  for  such  Settlement  Period  or  (c)  the
Eurodollar Rate determined  pursuant hereto does not accurately reflect the cost
to the Issuer (as conclusively  determined by the  Administrator) of maintaining
any Portion of Capital during such Settlement  Period,  the Administrator  shall
promptly give telephonic notice of such determination,  confirmed in writing, to
the Seller before the first day of such Settlement Period. Upon delivery of such
notice:  (i) no Portion of Capital  shall be funded  thereafter at the Alternate
Rate  determined  by  reference  to the  Eurodollar  Rate  unless  and until the
Administrator  shall have  given  notice to the  Seller  that the  circumstances
giving rise to such  determination no longer exist, and (ii) with respect to any
outstanding  Portions of Capital then funded at the Alternate Rate determined by
reference to the Eurodollar  Rate, such Alternate Rate shall, on the immediately
succeeding  Settlement  Date,  automatically  be converted to the Alternate Rate
determined  by  reference  to the Base Rate at the  respective  last days of the
then-current Settlement Periods relating to such Portions of Capital.

I.                                    ARTICLE
                  REPRESENTATIONS AND WARRANTIES; COVENANTS;
                               TERMINATION EVENTS

A.          Section  Representations  and Warranties;  Covenants.  Each of the
Seller and the Servicer hereby makes the representations  and warranties,  and
hereby  agrees to perform  and  observe the  covenants,  applicable  to it set
forth in Exhibits III and IV, respectively.

A. Section  Termination  Events.  If any of the Termination  Events set forth in
Exhibit V shall occur, the Administrator  may, by notice to the Seller,  declare
the  Facility  Termination  Date to have  occurred  (in which case the  Facility
Termination Date shall be deemed to have occurred); provided, that automatically
upon the  occurrence of any event  (without any  requirement  for the passage of
time or the  giving of  notice)  described  in  paragraph  (f) of Exhibit V, the
Facility Termination Date shall occur. Upon any such declaration,  occurrence or
deemed  occurrence  of  the  Facility  Termination  Date,  the  Issuer  and  the
Administrator  shall have,  in addition to the rights and remedies that they may
have under this Agreement,  all other rights and remedies provided after default
under the New York UCC and under other applicable law, which rights and remedies
shall be cumulative.

I.                                    ARTICLE
                                 INDEMNIFICATION

A. Section Indemnities by the Seller. Without limiting any other rights that the
Administrator,  the  Issuer,  any  Program  Support  Provider  or any  of  their
respective  Affiliates,   employees,   officers,   directors,  agents,  counsel,
successors,   transferees  or  assigns  (each,   an   "Indemnified   Party"  and
collectively,  the "Parties") may have  hereunder or under  applicable  law, the
Seller hereby agrees to indemnify  each  Indemnified  Party from and against any
and all claims,  damages,  expenses,  costs,  losses and liabilities  (including
Attorney  Costs)  (all  of  the  foregoing  being  collectively  referred  to as
"Indemnified  Amounts") arising out of or resulting from this Agreement (whether
directly or indirectly), the use of proceeds of purchases or reinvestments,  the
ownership of the Purchased  Interest,  or any interest therein, or in respect of
any  Receivable,   Related  Security  or  Contract,   excluding,   however:  (a)
Indemnified  Amounts to the extent  resulting  from gross  negligence or willful
misconduct on the part of such  Indemnified  Party or its  officers,  directors,
agents (including any successor Servicer appointed by the Administrator pursuant
to Section 4.1(a)) or counsel,  (b) recourse  (except as otherwise  specifically
provided in this Agreement) for  uncollectible  Receivables,  or (c) any overall
net income taxes or franchise  taxes  imposed on such  Indemnified  Party by the
jurisdiction  under the laws of which such  Indemnified  Party is organized or a
political  subdivision  thereof.  Subject  to the  exclusions  set  forth in the
preceding  sentence,  but without  otherwise  limiting  or being  limited by the
foregoing,  the Seller shall pay on demand to each Indemnified Party any and all
amounts  necessary to indemnify such Indemnified  Party from and against any and
all Indemnified Amounts relating to or resulting from any of the following:

a) the  failure  of  any  Receivable  included  in the  calculation  of the  Net
Receivables Pool Balance as an Eligible Receivable to be an Eligible Receivable,
the failure of any  information  contained  in an Monthly  Report to be true and
correct,  or the failure of any other information  provided to the Issuer or the
Administrator  with  respect to  Receivables  or this  Agreement  to be true and
correct,

a) the failure of any representation,  warranty or statement made or deemed made
by the  Seller  (or  any of its  officers)  under  or in  connection  with  this
Agreement  to have been true and  correct as of the date made or deemed  made in
all respects,

a) the  failure  by the  Seller  to  comply  with any  applicable  law,  rule or
regulation with respect to any Pool Receivable or the related  Contract,  or the
failure of any Pool  Receivable  or the related  Contract to conform to any such
applicable law, rule or regulation,

a) the  failure to vest in the  Issuer a valid and  enforceable:  (A)  perfected
undivided  percentage  ownership  interest,  to  the  extent  of  the  Purchased
Interest,  in the Receivables  in, or purporting to be in, the Receivables  Pool
and the other Pool Assets, or (B) first priority  perfected security interest in
the Pool Assets, in each case, free and clear of any Adverse Claim,

a) the failure to have filed,  or any delay in filing,  financing  statements or
other  similar  instruments  or  documents  under  the  UCC  of  any  applicable
jurisdiction  or other  applicable  laws with respect to any  Receivables in, or
purporting to be in, the Receivables Pool and the other Pool Assets,  whether at
the time of any  purchase or  reinvestment  or at any  subsequent  time,  b) any
dispute,  claim,  offset or defense  (other than  discharge in bankruptcy of the
Obligor) of an Obligor to the payment of any  Receivable in, or purporting to be
in, the  Receivables  Pool  (including a defense based on such Receivable or the
related Contract not being a legal, valid and binding obligation of such Obligor
enforceable  against  it in  accordance  with its  terms),  or any  other  claim
resulting from the sale of the goods or services  related to such  Receivable or
the  furnishing  or failure to furnish  such goods or  services  or  relating to
collection  activities  with  respect  to such  Receivable  (if such  collection
activities  were  performed  by the  Seller or any of its  Affiliates  acting as
Servicer or by any agent or independent contractor retained by the Seller or any
of its Affiliates),

a)           any  failure of the Seller  (or any of its  Affiliates  acting as
the  Servicer) to perform its duties or  obligations  in  accordance  with the
provisions hereof or under the Contracts,

a)           any products liability or other claim, investigation,  litigation
or proceeding  arising out of or in connection with merchandise,  insurance or
services that are the subject of any Contract,

a)           the commingling of Collections at any time with other funds,

a)           the use of proceeds of purchases or reinvestments, or

a) any  reduction  in Capital  as a result of the  distribution  of  Collections
pursuant  to Section  1.4(d),  if all or a portion of such  distributions  shall
thereafter be rescinded or otherwise must be returned for any reason.

A. Section  Indemnities by the Servicer.  Without limiting any other rights that
the Administrator,  the Issuer or any other Indemnified Party may have hereunder
or  under   applicable  law,  the  Servicer  hereby  agrees  to  indemnify  each
Indemnified  Party from and against any and all Indemnified  Amounts arising out
of or resulting from (whether  directly or  indirectly):  (a) the failure of any
information contained in a Monthly Report to be true and correct, or the failure
of any other  information  provided to the Issuer or the Administrator by, or on
behalf  of,  the  Servicer  to be  true  and  correct,  (b) the  failure  of any
representation,  warranty or  statement  made or deemed made by the Servicer (or
any of its  officers)  under or in connection  with this  Agreement to have been
true and  correct in all  respects as of the date made or deemed  made,  (c) the
failure by the Servicer to comply with any  applicable  law,  rule or regulation
with respect to any Pool  Receivable or the related  Contract,  (d) any dispute,
claim,  offset or defense of the Obligor to the payment of any Receivable in, or
purporting  to be in,  the  Receivables  Pool  resulting  from or related to the
collection activities with respect to such Receivable, or (e) any failure of the
Servicer to perform its duties or obligations in accordance  with the provisions
hereof.

I.                                    ARTICLE
                         ADMINISTRATION AND COLLECTIONS

1.  Section  Appointment  of the  Servicer.  The  servicing,  administering  and
collection  of  the  Pool  Receivables  shall  be  conducted  by the  Person  so
designated  from time to time as the Servicer in  accordance  with this Section.
Until the Administrator gives notice to IMO (in accordance with this Section) of
the  designation  of a new  Servicer,  IMO is hereby  designated  as, and hereby
agrees to perform the duties and  obligations  of, the Servicer  pursuant to the
terms hereof.  Upon the occurrence and during the  continuation of a Termination
Event, the Administrator may designate as Servicer any Person (including itself)
to succeed IMO or any successor Servicer, on the condition in each case that any
such Person so designated  shall agree to perform the duties and  obligations of
the Servicer pursuant to the terms hereof.

1. Upon the designation of a successor  Servicer as set forth in clause (a), IMO
agrees that it will terminate its  activities as Servicer  hereunder in a manner
that the Administrator  reasonably  determines will facilitate the transition of
the performance of such activities to the new Servicer,  and IMO shall cooperate
with and assist such new Servicer.  Such cooperation shall include access to and
transfer of related records and, to the extent legally  permissible,  use by the
new  Servicer of all  licenses,  hardware or software  necessary or desirable to
collect the Pool Receivables and the Related Security.

1. IMO acknowledges  that, in making their decisions to execute and deliver this
Agreement,  the  Administrator  and the Issuer have relied on IMO's agreement to
act as Servicer hereunder.  Accordingly, IMO agrees that it will not voluntarily
resign as Servicer.

1. The  Servicer  may with  the  prior  written  consent  of the  Administrator,
delegate  its  duties  and  obligations  hereunder  to any  subservicer  (each a
"Sub-Servicer");  provided, that, in each such delegation: (i) such Sub-Servicer
shall agree in writing to perform  the duties and  obligations  of the  Servicer
pursuant to the terms hereof,  (ii) the Servicer shall remain  primarily  liable
for the  performance  of the  duties and  obligations  so  delegated,  (iii) the
Seller,  the Administrator and the Issuer shall have the right to look solely to
the  Servicer  for  performance,  and (iv) the terms of any  agreement  with any
Sub-Servicer  shall provide that the  Administrator may terminate such agreement
upon the termination of the Servicer hereunder by giving notice of its desire to
terminate  such  agreement  to the  Servicer  (and the  Servicer  shall  provide
appropriate notice to each such Sub-Servicer).

1. Section Duties of the Servicer.  The Servicer shall take or cause to be taken
all such action as may be necessary or advisable to administer  and collect each
Pool Receivable from time to time, all in accordance with this Agreement and all
applicable laws, rules and regulations,  with reasonable care and diligence, and
in accordance  with the Credit and  Collection  Policy.  The Servicer  shall set
aside,  for the  accounts  of the  Seller  and the  Issuer,  the  amount  of the
Collections to which each is entitled in accordance with Article I. The Servicer
may, in accordance with the Credit and Collection Policy, extend the maturity of
any Pool  Receivable  (but not beyond a total of 60 days from the invoice  date)
and  extend the  maturity  or adjust the  Outstanding  Balance of any  Defaulted
Receivable  as  the  Servicer  may  determine  to  be  appropriate  to  maximize
Collections thereof;  provided,  however, that: (i) such extension or adjustment
shall not alter the status of such Pool Receivable as a Delinquent Receivable or
a Defaulted  Receivable  or limit the rights of the Issuer or the  Administrator
under this Agreement and (ii) if a Termination  Event has occurred and IMO or an
Affiliate  thereof is serving as the  Servicer,  IMO or such  Affiliate may make
such  extension  or  adjustment  only upon the  prior  written  approval  of the
Administrator.  The Seller shall deliver to the Servicer and the Servicer  shall
hold for the benefit of the Seller and the  Administrator  (individually and for
the benefit of the Issuer), in accordance with their respective  interests,  all
records and documents  (including  computer tapes or disks) with respect to each
Pool Receivable.  Notwithstanding anything to the contrary contained herein, the
Administrator  may direct the Servicer (whether the Servicer is IMO or any other
Person) to commence or settle any legal action to enforce collection of any Pool
Receivable which is a Defaulted Receivable or to foreclose upon or repossess any
Related Security.

1. The  Servicer  shall,  as soon as  practicable  following  actual  receipt of
collected  funds,  turn over to the Seller the  collections of any  indebtedness
that is not a Pool Receivable,  less, if IMO or an Affiliate  thereof is not the
Servicer,  all reasonable and  appropriate  out-of-pocket  costs and expenses of
such Servicer of servicing,  collecting and administering such collections.  The
Servicer,  if  other  than  IMO or an  Affiliate  thereof,  shall,  as  soon  as
practicable  upon  demand,  deliver to the Seller all records in its  possession
that evidence or relate to any indebtedness  that is not a Pool Receivable,  and
copies of records in its possession that evidence or relate to any  indebtedness
that is a Pool Receivable.

1. The Servicer's obligations hereunder shall terminate on the later of: (i) the
Facility  Termination Date and (ii) the date on which all amounts required to be
paid to the  Issuer,  the  Administrator  and any  other  Indemnified  Party  or
Affected Person hereunder shall have been paid in full.

      After  such  termination,  if IMO or an  Affiliate  thereof  was  not  the
Servicer on the date of such termination, the Servicer shall promptly deliver to
the Seller all books,  records and related  materials that the Seller previously
provided  to the  Servicer,  or that  have been  obtained  by the  Servicer,  in
connection with this Agreement.

A.          Section  Establishment and Use of Certain  Accounts.  (a) Prior to
the  initial  purchase  hereunder,   the  Seller  shall  enter  into  Lock-Box
Agreements  establishing the Lock-Box  Accounts listed on Schedule II with all
of the  Lock-Box  Banks,  and  deliver  original  counterparts  thereof to the
Administrator.

            (b) The Servicer  agrees to establish the  Collection  Account on or
before the date of the first purchase hereunder. The Collection Account shall be
used to accept the transfer of Collections of Pool Receivables from the Lock-Box
Accounts pursuant to Section 1.4(b) and for such other purposes described in the
Transaction Documents.

            (c) Any  amounts in the  Collection  Account  may be invested by the
Collection Account Bank at the Servicer's direction,  in Permitted  Investments,
so long as Issuer's interest in such Permitted Investments is perfected and such
Permitted  Investments  are subject to no Adverse Claims other than those of the
Issuer provided hereunder.

            (d) Upon the occurrence and during the continuation of a Termination
Event, the Administrator may at any time thereafter give notice to each Lock-Box
Bank and the Collection  Account Bank that the  Administrator  is exercising its
rights under the Lock-Box  Agreements and the Collection Account  Agreement,  as
applicable,  to do  any  or all of the  following:  (i) to  have  the  exclusive
ownership  and  control of the  Lock-Box  Accounts  and the  Collection  Account
transferred to the Administrator and to exercise  exclusive dominion and control
over the funds deposited therein, (ii) to have the proceeds that are sent to the
respective   Lock-Box  Accounts   redirected  pursuant  to  the  Administrator's
instructions,  and (iii) to take any or all other  actions  permitted  under the
applicable  Lock-Box Agreement and the Collection Account Agreement.  The Seller
hereby agrees that if the  Administrator  at any time takes any action set forth
in the preceding sentence, the Administrator shall have exclusive control of the
proceeds  (including  Collections) of all Pool Receivables and the Seller hereby
further  agrees to take any other action that the  Administrator  may reasonably
request to transfer such control.  Any proceeds of Pool Receivables  received by
the  Seller  or  the  Servicer  thereafter  shall  be  sent  immediately  to the
Administrator.

1.          Section   Enforcement   Rights.   At  any   time   following   the
occurrence and during the continuation of a Termination Event:

a)           the  Administrator  may direct the  Obligors  that payment of all
amounts  payable  under  any Pool  Receivable  is to be made  directly  to the
Administrator or its designee,

a)  the  Administrator  may  give  notice  of  the  Issuer's  interest  in  Pool
Receivables  to each  Obligor,  which notice shall direct that  payments be made
directly to the Administrator or its designee, and

a) the  Administrator  may request the  Servicer  to, and upon such  request the
Servicer  shall:  (A)  assemble  all of the records  necessary  or  desirable to
collect the Pool Receivables and the Related Security, and to the extent legally
permissible  transfer or license to a successor Servicer the use of all software
necessary or desirable to collect the Pool Receivables and the Related Security,
and make the same  available  to the  Administrator  or its  designee at a place
selected by the  Administrator,  and (B)  segregate  all cash,  checks and other
instruments  received  by it from  time to time  constituting  Collections  in a
manner  acceptable to the Administrator  and,  promptly upon receipt,  remit all
such  cash,  checks  and  instruments,  duly  endorsed  or  with  duly  executed
instruments of transfer, to the Administrator or its designee.

1. The Seller hereby authorizes the Administrator,  and irrevocably appoints the
Administrator as its  attorney-in-fact  with full power of substitution and with
full  authority  in the place  and stead of the  Seller,  which  appointment  is
coupled  with an  interest,  to take any and all steps in the name of the Seller
and on behalf of the Seller necessary or desirable,  in the determination of the
Administrator, after the occurrence and during the continuation of a Termination
Event, to collect any and all amounts or portions  thereof due under any and all
Pool  Assets,  including  endorsing  the name of the  Seller on checks and other
instruments   representing   Collections   and   enforcing   such  Pool  Assets.
Notwithstanding  anything to the contrary contained in this subsection,  none of
the  powers  conferred  upon such  attorney-in-fact  pursuant  to the  preceding
sentence  shall  subject such  attorney-in-fact  to any  liability if any action
taken by it shall prove to be inadequate  or invalid,  nor shall they confer any
obligations upon such attorney-in-fact in any manner whatsoever.

1.  Section  Responsibilities  of the Seller.  Anything  herein to the  contrary
notwithstanding,  the Seller shall pay when due any taxes,  including  any sales
taxes payable in connection  with the Pool  Receivables  and their  creation and
satisfaction.  The Administrator and the Issuer shall not have any obligation or
liability with respect to any Pool Asset,  nor shall either of them be obligated
to perform  any of the  obligations  of the Seller,  Servicer or any  Originator
thereunder.

1. IMO hereby  irrevocably  agrees  that if at any time it shall cease to be the
Servicer hereunder,  it shall act (if the then-current  Servicer so requests) as
the  data-processing  agent of the  Servicer  and, in such  capacity,  IMO shall
conduct the  data-processing  functions of the administration of the Receivables
and the  Collections  thereon in  substantially  the same way that IMO conducted
such data-processing functions while it acted as the Servicer.

A.          Section  Servicing  Fee.  (a) Subject to clause (b),  the Servicer
shall be paid a fee equal to 1.0% per annum (the  "Servicing Fee Rate") of the
daily  average  aggregate  Outstanding  Balance of the Pool  Receivables.  The
Issuer's   Share  of  such  fee  shall  be  paid  through  the   distributions
contemplated  by Section  1.4(d),  and the Seller's Share of such fee shall be
paid by the Seller.

      (b)  If  the  Servicer  ceases  to be IMO  or an  Affiliate  thereof,  the
servicing  fee shall be the  greater of: (i) the amount  calculated  pursuant to
clause (a), and (ii) an alternative  amount specified by the successor  Servicer
not to exceed 110% of the aggregate  reasonable  costs and expenses  incurred by
such successor Servicer in connection with the performance of its obligations as
Servicer.

I.                                    ARTICLE
                                  MISCELLANEOUS

A. Section  Amendments,  Etc. No  amendment  or waiver of any  provision of this
Agreement or any other Transaction  Document, or consent to any departure by the
Seller or the Servicer therefrom,  shall be effective unless in a writing signed
by the  Administrator,  and, in the case of any amendment,  by the other parties
thereto;  and then such amendment,  waiver or consent shall be effective only in
the specific  instance and for the specific  purpose for which given;  provided,
however,  that no such material  amendment shall be effective until both Moody's
and  Standard & Poor's have  notified  the  Administrator  in writing  that such
action will not result in a reduction or  withdrawal of the rating of any Notes.
No failure on the part of the Issuer or the  Administrator  to exercise,  and no
delay in exercising any right hereunder  shall operate as a waiver thereof,  nor
shall any single or partial  exercise of any right hereunder  preclude any other
or  further   exercise   thereof  or  the  exercise  of  any  other  right.  The
Administrator  shall provide each Rating Agency with a copy of each amendment to
or waiver or consent under this Agreement  promptly following the effective date
thereof.

A.  Section  Notices,  Etc.  All notices and other  communications  provided for
hereunder  shall,  unless  otherwise  stated  herein,  be in writing  (including
facsimile  communication)  and shall be personally  delivered or sent by express
mail or courier or by certified mail,  postage-prepaid,  or by facsimile, to the
intended party at the address or facsimile  number of such party set forth under
its name on the  signature  pages  hereof or at such other  address or facsimile
number as shall be  designated  by such  party in a written  notice to the other
parties hereto. All such notices and communications  shall be effective,  (i) if
personally  delivered or sent by express mail or courier or if sent by certified
mail, when received,  and (ii) if transmitted by facsimile,  when sent,  receipt
confirmed by telephone or electronic means.

1. Section Assignability. This Agreement and the Issuer's rights and obligations
herein  (including  ownership of the Purchased  Interest or an interest therein)
shall be  assignable,  in whole or in part, by the Issuer and its successors and
assigns with the prior written consent of the Seller;  provided,  however,  that
such consent shall not be unreasonably  withheld;  and provided further, that no
such consent  shall be required if the  assignment is made to BNS, any Affiliate
of BNS, any Purchaser or other Program  Support  Provider or any Person that is:
(i) in the business of issuing Notes and (ii) associated with or administered by
BNS or any Affiliate of BNS.

1. The Issuer  may at any time grant to one or more banks or other  institutions
(each a "Purchaser") party to the Liquidity  Agreement,  or to any other Program
Support  Provider,  participating  interests in the Purchased  Interest.  In the
event of any such grant by the Issuer of a participating interest to a Purchaser
or other Program Support Provider,  the Issuer shall remain  responsible for the
performance  of its  obligations  hereunder  and  except as  otherwise  provided
herein,  Seller and Servicer shall continue to deal with Issuer as if Issuer had
not granted such participating  interest.  The Seller agrees that each Purchaser
or other Program Support  Provider shall be entitled to the benefits of Sections
1.8 and 1.9.

1. This Agreement and the rights and obligations of the Administrator  hereunder
shall  be  assignable,  in  whole  or in  part,  by the  Administrator  and  its
successors  and assigns;  provided,  that unless:  (i) such  assignment is to an
Affiliate of BNS, (ii) it becomes unlawful for BNS to serve as the Administrator
or  (iii)  a  Termination  Event  exists,  the  Seller  has  consented  to  such
assignment, which consent shall not be unreasonably withheld.

1. Except as provided in Section 4.1(d), none of the Seller, IMO or the Servicer
may assign its rights or delegate  its  obligations  hereunder  or any  interest
herein without the prior written consent of the Administrator.

1.           Without  limiting any other  rights that may be  available  under
applicable law, the rights of the Issuer may be enforced  through it or by its
agents.

1.  Section   Costs,   Expenses  and  Taxes.   In  addition  to  the  rights  of
indemnification  granted  under  Section 3.1, the Seller agrees to pay on demand
all reasonable costs and expenses in connection with the preparation, execution,
delivery  and  administration   (including   periodic  internal  audits  by  the
Administrator  of Pool  Receivables)  of this Agreement,  the other  Transaction
Documents and the other documents and agreements to be delivered  hereunder (and
all reasonable  costs and expenses in connection  with any amendment,  waiver or
modification   of  any  thereof),   including:   (i)  Attorney   Costs  for  the
Administrator,  the  Issuer and their  respective  Affiliates  and  agents  with
respect thereto and with respect to advising the  Administrator,  the Issuer and
their  respective  Affiliates  and agents as to their rights and remedies  under
this  Agreement and the other  Transaction  Documents,  and (ii) all  reasonable
costs and expenses (including Attorney Costs), if any, of the Administrator, the
Issuer  and  their  respective  Affiliates  and  agents in  connection  with the
enforcement  of this  Agreement and the other  Transaction  Documents.  Unless a
Termination  Event or Unmatured  Termination Event shall exist, the Seller shall
only be responsible for the cost of one periodic  internal audit described above
in any twelve month period.

1. In addition, the Seller shall pay on demand any and all stamp and other taxes
and  fees  payable  in  connection  with the  execution,  delivery,  filing  and
recording of this Agreement or the other documents or agreements to be delivered
hereunder,  and agrees to save each Indemnified  Party harmless from and against
any  liabilities  with  respect  to or  resulting  from any  delay in  paying or
omission to pay such taxes and fees.

A. Section No Proceedings;  Limitation on Payments. Each of the Seller, IMO, the
Servicer,  the  Administrator,  each assignee of the  Purchased  Interest or any
interest  therein,  hereby  covenants  and  agrees  that it will  not  institute
against,  or join any other  Person  in  instituting  against,  the  Issuer  any
bankruptcy,  reorganization,  arrangement, insolvency or liquidation proceeding,
or other  proceeding  under any federal or state  bankruptcy or similar law, for
one year and one day after the latest maturing Note issued by the Issuer is paid
in full. The provision of this Section 5.5 shall survive any termination of this
Agreement.

A. Section Confidentiality. Unless otherwise required by applicable law, each of
the Seller and Servicer agrees to maintain the confidentiality of this Agreement
and the other  Transaction  Documents  (and all drafts  hereof and  thereof)  in
communications  with third parties and  otherwise;  provided that this Agreement
may be disclosed  to: (a) third  parties to the extent such  disclosure  is made
pursuant  to a  written  agreement  of  confidentiality  in form  and  substance
reasonably satisfactory to the Administrator, (b) the Seller's legal counsel and
auditors  if they  agree to hold it  confidential,  (c) in  filings  made  under
securities laws and (d) the parties to the Credit  Agreement.  Unless  otherwise
required by applicable law, each of the  Administrator  and the Issuer agrees to
maintain  the   confidentiality  of  all  information   regarding  IMO  and  its
Subsidiaries, this Agreement and the other Transaction Documents (and all drafts
hereof and thereof) in communications with third parties and otherwise; provided
that such  information may be disclosed to: (i) third parties to the extent such
disclosure is made pursuant to a written  agreement of  confidentiality  in form
and substance reasonably satisfactory to IMO, (ii) legal counsel and auditors of
the Issuer or the Administrator if they agree to hold it confidential, (iii) the
rating agencies rating the Notes to the extent such  information  relates to the
Receivables Pool or the transactions  contemplated by this Agreement,  or if not
so related,  upon  obtaining  the prior  consent of IMO (such  consent not to be
unreasonably  withheld),  (iv) any Program Support Provider or potential Program
Support Provider to the extent such information  relates to the Receivables Pool
or the transactions  contemplated by this Agreement,  or if not so related, upon
obtaining the prior written  consent of IMO (such consent not to be unreasonably
withheld),  (v) any placement  agent placing the Notes,  and (vi) any regulatory
authorities  having  jurisdiction  over BNS,  the  Issuer  any  Program  Support
Provider or any Purchaser.

1. Section GOVERNING LAW AND JURISDICTION.  THIS AGREEMENT SHALL BE DEEMED TO BE
A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK
(INCLUDING  FOR  SUCH  PURPOSE   SECTIONS  5-1401  AND  5-1402  OF  THE  GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK) EXCEPT TO THE EXTENT THAT THE VALIDITY
OR PERFECTION OF A SECURITY  INTEREST OR REMEDIES  HEREUNDER,  IN RESPECT OF ANY
PARTICULAR  COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE
STATE OF NEW YORK.

1. ANY LEGAL ACTION OR PROCEEDING  WITH RESPECT TO THIS AGREEMENT MAY BE BROUGHT
IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED  STATES FOR THE SOUTHERN
DISTRICT OF NEW YORK; AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT,  EACH OF
THE PARTIES HERETO CONSENTS,  FOR ITSELF AND IN RESPECT OF ITS PROPERTY,  TO THE
NON-EXCLUSIVE   JURISDICTION  OF  THOSE  COURTS.  EACH  OF  THE  PARTIES  HERETO
IRREVOCABLY  WAIVES,  TO THE MAXIMUM  EXTENT  PERMITTED BY LAW,  ANY  OBJECTION,
INCLUDING  ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM
NON CONVENIENS,  THAT IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION
OR PROCEEDING IN SUCH  JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT
RELATED  HERETO.  EACH OF THE  PARTIES  HERETO  WAIVES  PERSONAL  SERVICE OF ANY
SUMMONS,  COMPLAINT  OR OTHER  PROCESS,  WHICH  SERVICE MAY BE MADE BY ANY OTHER
MEANS PERMITTED BY NEW YORK LAW.

A.          Section   Execution  in   Counterparts.   This  Agreement  may  be
executed  in any  number of  counterparts,  each of which,  when so  executed,
shall be deemed to be an  original,  and all of which,  when  taken  together,
shall constitute one and the same agreement.

A.          Section  Survival of Termination.  The provisions of Sections 1.8,
1.9,  3.1,  3.2,  5.4,  5.5,  5.6,  5.7,  5.8, 5.10 and 5.13 shall survive any
termination of this Agreement.

A.  Section  WAIVER OF JURY  TRIAL.  EACH OF THE  PARTIES  HERETO  WAIVES  THEIR
RESPECTIVE  RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON
OR ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS  CONTEMPLATED
HEREBY IN ANY ACTION,  PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY
OF THE  PARTIES  AGAINST ANY OTHER PARTY OR  PARTIES,  WHETHER  WITH  RESPECT TO
CONTRACT  CLAIMS,  TORT CLAIMS OR OTHERWISE.  EACH OF THE PARTIES  HERETO AGREES
THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A
JURY. WITHOUT LIMITING THE FOREGOING,  EACH OF THE PARTIES HERETO FURTHER AGREES
THAT ITS  RESPECTIVE  RIGHT TO A TRIAL BY JURY IS  WAIVED BY  OPERATION  OF THIS
SECTION AS TO ANY ACTION,  COUNTERCLAIM OR OTHER PROCEEDING THAT SEEKS, IN WHOLE
OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR ANY
PROVISION  HEREOF.  THIS  WAIVER  SHALL  APPLY  TO  ANY  SUBSEQUENT  AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.

A.          Section   Entire   Agreement.   This   Agreement   and  the  other
Transaction  Documents embody the entire agreement and  understanding  between
the parties hereto, and supersede all prior or contemporaneous  agreements and
understandings  of such  Persons,  verbal or written,  relating to the subject
matter hereof and thereof.

A.          Section  Headings.  The captions  and  headings of this  Agreement
and any  Exhibit,  Schedule or Annex hereto are for  convenience  of reference
only and shall not affect the interpretation hereof or thereof.

A.  Section  Issuer's  Liabilities.  The  obligations  of the  Issuer  under the
Transaction  Documents are solely the corporate  obligations  of the Issuer.  No
recourse  shall be had for any  obligation or claim arising out of or based upon
any Transaction Document against any stockholder, employee, officer, director or
incorporator  of the Issuer;  provided,  however,  that this  Section  shall not
relieve any such Person of any  liability  it might  otherwise  have for its own
gross negligence or willful misconduct.

                         Receivables Purchase Agreement

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

                                                      IMO  FUNDING  COMPANY,
                              LLC,
                                    as Seller

                              By:
                               Name: John A. Young

                              Title: Vice President

                                    Address:
                                    9211 Forest Hill Avenue
                                    Suite 109
                                    Richmond, Virginia 23235
                                    Attention: John A. Young
                                    Telephone: (804) 327-5673
                                    Facsimile: (804) 327-5688

                              IMO INDUSTRIES INC.

                              By:
                               Name: John A. Young

                              Title: Vice President

                                    Address:

                                    997 Lenox Drive
                                    Suite 111
                                    Lawrence, New Jersey 08648
                                    Attention: Thomas M. O'Brien
                                    Telephone: (609) 896-7627
                                    Facsimile: (609) 896-7633

                                                LIBERTY STREET FUNDING CORP.
                                    as Issuer

                                                By:
                              Name:
                              Title:

                                    Address:

                                  Liberty Street Funding Corp.
                                  c/o Global Securitization
                                     Services, LLC

                             25 West 43rd Street, Suite 704
                            New York, New York 10036

                                  Attention: Andrew L. Stidd
                                  Telephone No.: (212) 302-8330
                                  Facsimile No.: (212) 302-8767

                                  With a copy to:

                                  The Bank of Nova Scotia

                                One Liberty Plaza

                            New York, New York 10006

                                                          Attention:   Dorothy

                              Poli

                                                          Telephone       No.:
                                 (212) 225-5000

                                                          Facsimile       No.:
                                 (212) 225-5090

                                                      THE BANK OF NOVA SCOTIA,
                                as Administrator

                                                By:

                        Name:_______________________________

                        Title:______________________________

                                    Address:

                                  The Bank of Nova Scotia

                                One Liberty Plaza

                            New York, New York 10006

                                                    Attention:   Dorothy Poli

                             Telephone       No.: (212) 225-5000
                             Facsimile       No.: (212) 225-5090

                                    EXHIBIT I

                                   DEFINITIONS

      As used in the Agreement (including its Exhibits,  Schedules and Annexes),
the  following  terms shall have the  following  meanings  (such  meanings to be
equally  applicable to both the singular and plural forms of the terms defined).
Unless otherwise indicated,  all Section, Annex, Exhibit and Schedule references
in this  Exhibit are to Sections of and Annexes,  Exhibits and  Schedules to the
Agreement.

      "Accrued  Customer  Rebate" means the  aggregate  current  accrued  amount
recorded on the accounting  ledgers of the Originators,  which amount is owed to
the Obligors as a result of discounts.

      "Accrued  Customer  Rebate  Reserve" means an amount equal to (i) prior to
January  1,  2000,  zero and (ii) on and after  January  1,  2000,  the  Accrued
Customer Rebate.

      "Administration  Account" means the account, account number 2158-13 of the
Administrator maintained at the office of The Bank of Nova Scotia, or such other
account as may be so designated in writing by the Administrator to the Servicer.

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

      "Adverse  Claim"  means a lien,  security  interest  or  other  charge  or
encumbrance,  or any other type of preferential arrangement; it being understood
that any thereof in favor of the Issuer or the Administrator (for the benefit of
the Issuer) shall not constitute an Adverse Claim.

      "Affected  Person"  has  the  meaning  set  forth  in  Section  1.7 of the
Agreement.

      "Affiliate"  means,  as to any Person:  (a) any Person  that,  directly or
indirectly,  is in control of, is controlled by or is under common  control with
such Person, or (b) who is a director or officer:  (i) of such Person or (ii) of
any Person  described in clause (a),  except  that,  with respect to the Issuer,
Affiliate  shall mean the holder(s) of its capital  stock.  For purposes of this
definition, control of a Person shall mean the power, direct or indirect: (x) to
vote 25% or more of the securities having ordinary voting power for the election
of  directors  of such  Person,  or (y) to direct or cause the  direction of the
management  and policies of such Person,  in either case whether by ownership of
securities, contract, proxy or otherwise.

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

      "Alternate  Rate" for any Settlement  Period for any Portion of Capital of
the  Purchased  Interest  means an  interest  rate per annum  equal to:  (a) the
Applicable  Margin plus the  Eurodollar  Rate or, in the sole  discretion of the
Administrator,  (b) the Base Rate plus the Applicable Margin for such Settlement
Period;  provided,  however,  that  the  "Alternate  Rate"  for any day  while a
Termination Event exists shall be an interest rate equal to the greater (i) 1.0%
per annum  above  the Base  Rate in  effect  on such day or (ii) the  Applicable
Margin plus the Base Rate in effect on such day.

      "Applicable Margin" has the meaning set forth in the Fee Letter.

      "Attorney Costs" means and includes all reasonable fees and  disbursements
of any law firm or other  external  counsel,  the  reasonable  allocated cost of
internal legal services and all reasonable  disbursements  of internal  counsel,
which fees,  disbursements  and costs shall be set forth in reasonably  detailed
statements.

      "Bankruptcy  Code" means the United States Bankruptcy Reform Act of 1978
(11 U.S.C.ss. 101, et seq.), as amended from time to time.

      "Base Rate" means,  for any day, a fluctuating  interest rate per annum as
shall be in effect from time to time,  which rate shall be at all times equal to
the higher of:

1. the rate of interest in effect for such day as publicly  announced  from time
to time by BNS in New York, New York as its "reference  rate".  Such  "reference
rate" is set by BNS  based  upon  various  factors,  including  BNS's  costs and
desired return,  general economic conditions and other factors, and is used as a
reference  point for pricing some loans,  which may be priced at, above or below
such announced rate, and

1.           0.75% per annum above the latest Federal Funds Rate.

      "Benefit  Plan"  means any  employee  benefit  pension  plan as defined in
Section 3(2) of ERISA in respect of which the Seller,  each  Originator,  IMO or
any ERISA  Affiliate  is, or at any time during the  immediately  preceding  six
years was, an "employer" as defined in Section 3(5) of ERISA.

      "BNS" has the meaning set forth in the preamble to the Agreement

      "Business  Day" means any day (other  than a Saturday or Sunday) on which:
(a) banks  are not  authorized  or  required  to close in New York,  New York or
Chicago,  Illinois and (b) if this  definition of "Business  Day" is utilized in
connection  with the  Eurodollar  Rate,  dealings  are carried out in the London
interbank market.

      "Capital"  means the amount paid to the Seller in respect of the Purchased
Interest by the Issuer  pursuant  to the  Agreement,  or such amount  divided or
combined  in order to  determine  the  Discount  applicable  to any  portion  of
Capital,  in each case reduced from time to time by Collections  distributed and
applied on account of such Capital  pursuant to Section 1.4(d) of the Agreement;
provided, that if such Capital shall have been reduced by any distribution,  and
thereafter all or a portion of such  distribution is rescinded or must otherwise
be returned  for any reason,  such  Capital  shall be increased by the amount of
such rescinded or returned distribution as though it had not been made.

      "Change in Control" means that IMO ceases to own,  directly or indirectly,
100% of the capital stock of the Seller free and clear of all Adverse Claims.

      "Closing Date" means November 30, 1999.

      "Collections"  means,  with respect to any Pool Receivable:  (a) all funds
that are  received by any  Originator,  the Seller or the Servicer in payment of
any  amounts  owed in  respect of such  Receivable  (including  purchase  price,
finance charges,  interest and all other charges), or applied to amounts owed in
respect of such Receivable (including insurance payments and net proceeds of the
sale or other  disposition of repossessed  goods or other collateral or property
of the related Obligor or any other Person directly or indirectly liable for the
payment of such Pool  Receivable and available to be applied  thereon),  (b) all
Deemed Collections and (c) all other proceeds of such Pool Receivable.

      "Collection  Account" means that certain bank account numbered  3751450511
maintained at Bank of America,  N.A. which is (i) identified as the "Imo Funding
Company, LLC Collection Account," (ii) in the Seller's name, (iii) pledged, on a
first-priority  basis,  to the Issuer  pursuant to Section  1.2(d),  and (iv) is
governed by a Collection Account Agreement.

      "Collection  Account Agreement" means a letter agreement among the Seller,
the  Agent  and  the  Collection  Account  Bank,  as the  same  may be  amended,
supplemented,  amended and restated,  or otherwise modified from time to time in
accordance with the Agreement.

      "Collection  Account  Bank"  means  the bank  maintaining  the  Collection
Account.

      "Company  Note" has the meaning  set forth in Section 3.2 of the  Purchase
and Sale Agreement.

      "Concentration  Percentage"  means: (a) for any Group A Obligor,  12%, (b)
for any Group B Obligor,  12%,  (c) for any Group C Obligor,  6% and (d) for any
Group D Obligor, 3%; provided,  however, that the Issuer may, with prior written
consent from the Administrator and the Liquidity Agent, and if the Rating Agency
Condition is satisfied,  approve higher  Concentration  Percentages for selected
Obligors

      "Contract" means,  with respect to any Receivable,  any and all contracts,
instruments,  agreements,  leases, invoices, notes or other writings pursuant to
which such Receivable  arises or that evidence such Receivable or under which an
Obligor becomes or is obligated to make payment in respect of such Receivable.

      "CP Rate" for any  Settlement  Period  for any  Portion  of Capital of the
Purchased Interest means, to the extent the Issuer funds such Portion of Capital
by issuing  Notes, a rate per annum equal to the sum of (i) the rate (or if more
than one rate,  the weighted  average of the rates) at which Notes of the Issuer
on each  day  during  such  period  have  been  sold by any  placement  agent or
commercial  paper dealer selected by the  Administrator  on behalf of the Issuer
during such Settlement Period to fund such Portion of Capital; provided, that if
the rate (or rates) is a discount  rate (or rates),  then such rate shall be the
rate (or if more than one rate,  the  weighted  average of the rates)  resulting
from converting such discount rate (or rates) to an interest-bearing  equivalent
rate per annum,  plus (ii) the commissions and charges charged by such placement
agent or  commercial  paper  dealer with  respect to such Notes,  expressed as a
percentage of such face amount and converted to an  interest-bearing  equivalent
rate per annum.

      "Credit  Agreement"  means the  Credit  Agreement,  dated as of August 29,
1997, (as amended,  supplemented or otherwise  modified from time to time) among
IMO, Colfax  Corporation  (formerly known as II Acquisition  Corp.),  a Delaware
corporation,  BNS,  as the  administrative  agent and the  documentation  agent,
NationsBanc  Capital Markets,  Inc., as syndication  agent and certain financial
institutions from time to time parties thereto.

      "Credit and Collection  Policy" means,  as the context may require,  those
receivables  credit and collection  policies and practices of each Originator in
effect  on  the  date  of the  Agreement  and  described  in  Schedule  I to the
Agreement, as modified in compliance with the Agreement.

      "Days' Sales  Outstanding"  means,  for any  Reporting  Period,  an amount
computed as of the last day of such  Reporting  Period equal to: (a) the average
of the Outstanding Balance of all Pool Receivables as of the last day of each of
the three most recent Reporting  Periods ended on the last day of such Reporting
Period, divided by (b) the aggregate amount of new Receivables generated by each
Originator during the three Reporting Periods ended on or before the last day of
such Reporting Period, multiplied by (c) 90.

      "Debt" means,  without  duplication:  (a) indebtedness for borrowed money,
(b)  obligations  evidenced  by  bonds,  debentures,   notes  or  other  similar
instruments,  (c) obligations to pay the deferred  purchase price of property or
services,  (d) obligations as lessee under leases that shall have been or should
be, in accordance with generally  accepted  accounting  principles,  recorded as
capital  leases,  and (e)  obligations  under direct or indirect  guaranties  in
respect of, and  obligations  (contingent or otherwise) to purchase or otherwise
acquire,  or  otherwise  to  assure  a  creditor  against  loss in  respect  of,
indebtedness  or  obligations  of others of the kinds referred to in clauses (a)
through (d).

      "Deemed  Collections"  has the meaning set forth in Section  1.4(e)(ii) of
the Agreement.

      "Default Ratio" means the ratio  (expressed as a percentage and rounded to
the nearest 1/100 of 1%, with 5/1000th of 1% rounded upward)  computed as of the
last day of each Reporting Period by dividing:  (a) the sum of (i) the aggregate
Outstanding  Balance  (excluding  credit balances) of all Pool Receivables as to
which any  payment,  or part  thereof,  remained  unpaid for more than 90 to and
including  120 days from the  original  due date for such  payment  during  such
Reporting  Period  plus  (ii)  the  aggregate  Outstanding  Balance  of all Pool
Receivables  that  remained  unpaid for less than 91 days from the  original due
date and were written off as uncollectible  during such Reporting Period, by (b)
the aggregate  credit sales made by each Originator  during the Reporting Period
that is five Reporting Periods before such Reporting Period.

      "Defaulted Receivable" means a Receivable:

            (a) as to which any payment,  or part  thereof,  remains  unpaid for
      more than 90 days from the original due date for such payment, or

            (b) without duplication (i) as to which an Event of Bankruptcy shall
      have  occurred  with  respect to the Obligor  thereof or any other  Person
      obligated thereon or owning any Related Security with respect thereto,  or
      (ii) which has been, or,  consistent with the Credit and Collection Policy
      would be, written off the Seller's books as uncollectible.

      "Delinquency Ratio" means the ratio (expressed as a percentage and rounded
to the nearest 1/100 of 1%, with 5/1000th of 1% rounded  upward)  computed as of
the last day of each Reporting Period by dividing: (a) the aggregate Outstanding
Balance of all Pool Receivables that were Delinquent  Receivables on such day by
(b) the Net Receivables Pool Balance on such day.

      "Delinquent  Receivable"  means  a  Receivable  (other  than  a  Defaulted
Receivable)  as to which any payment,  or part thereof,  remains unpaid for more
than 60 days from the original due date for such payment.

      "Dilution Ratio" means the ratio (expressed as a percentage and rounded to
the nearest 1/100 of 1%, with 5/1000th of 1% rounded upward)  computed as of the
last day of each  Reporting  Period by  dividing:  (a) the  aggregate  amount of
payments  made  or owed by the  Seller  pursuant  to  Section  1.4(e)(i)  of the
Agreement during such calendar month (other than Accrued Customer Rebate) by (b)
the aggregate  credit sales made by each Originator  during the Reporting Period
that is two Reporting Periods before such Reporting Period.

      "Dilution  Reserve" means, on any day, an amount equal to: (a) the Capital
at the close of business of the Servicer on such date  multiplied by (b) (i) the
Dilution  Reserve  Percentage,  divided  by (ii) 1 minus  the  Dilution  Reserve
Percentage.

      "Dilution Reserve Percentage" means (a) 2.5%,;  provided,  however, if the
Dilution Ratio is equal to or greater than 6% then (b) 5.0%.

      "Discount" means:

            (a) for the  Portion of  Capital  for any  Settlement  Period to the
      extent the Issuer  will be funding  such  Portion of Capital  during  such
      Settlement Period through the issuance of Notes:

                               CPR x C x ED/360

            (b) for the  Portion of  Capital  for any  Settlement  Period to the
      extent the Issuer will not be funding such Portion of Capital  during such
      Settlement Period through the issuance of Notes:

                              AR x C x ED/Year + TF

      where:

                  AR    =     the  Alternate  Rate for the  Portion of Capital
                        for such Settlement Period,

                  C     =     the  relevant  Portion  of Capital  during  such
                        Settlement Period,
                  CPR   =     the CP Rate for the Portion of Capital,

                  ED    =     the   actual   number   of  days   during   such
                        Settlement Period,

            Year  =     if such Portion of Capital is funded  based upon:  (i)
                        the  Eurodollar  Rate,  360  days,  and  (ii) the Base
                        Rate, 365 or 366 days, as applicable, and

                  TF    =     the Termination  Fee, if any, for the Portion of
                        Capital for such Settlement Period;

provided,  however,  that during the occurrence and continuance of a Termination
Event,  the CP Rate  shall not be  available  and  Discount  for the  Portion of
Capital  shall be  determined  for each day in a Settlement  Period using a rate
equal to the Base Rate in effect on such day plus 1.0%; provided,  further, that
no provision of the Agreement shall require the payment or permit the collection
of Discount in excess of the maximum  permitted by applicable  law; and provided
further,  that Discount for the Portion of Capital shall not be considered  paid
by any  distribution  to the  extent  that at any time all or a portion  of such
distribution is rescinded or must otherwise be returned for any reason.

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

            (a) the Obligor of which is (i) a United States resident;  provided,
      however, if the Obligor of such Receivable is a resident of a jurisdiction
      other  than  the  United  States,   such  Receivable   shall  satisfy  the
      requirements of this clause (a)(i) if the aggregate Outstanding Balance of
      all Pool  Receivables of such Obligor that are Eligible  Receivables  when
      added  to  the  aggregate   Outstanding  Balance  of  all  other  Eligible
      Receivables  of the Obligors  that are not  residents of the United States
      shall not exceed 5% of the Net Receivables Pool Balance at such time, (ii)
      not a  government  or a  governmental  subdivision,  affiliate  or agency;
      provided,  however, if the Obligor of such Receivable is a government or a
      governmental  subdivision,  affiliate  or agency,  such  Receivable  shall
      satisfy  the   requirements  of  this  clause  (a)(ii)  if  the  aggregate
      Outstanding  Balance  of all Pool  Receivables  of such  Obligor  that are
      Eligible  Receivables when added to the aggregate  Outstanding  Balance of
      all other  Eligible  Receivables  of the Obligors that are  governments or
      governmental subdivisions, affiliates or agencies shall not exceed 7.5% of
      the Net  Receivables  Pool Balance at such time,  (iii) not subject to any
      action  of  the  type  described  in  paragraph  (f) of  Exhibit  V to the
      Agreement and (iv) not an Affiliate of IMO or any Affiliate of IMO,

            (b) that is  denominated  and payable only in U.S.  dollars in the
      United States,

            (c) that does not have a stated  maturity which is more than 30 days
      after the original invoice date of such Receivable,

            (d) that arises  under a duly  authorized  Contract for the sale and
      delivery of goods and services in the ordinary course of each Originator's
      business,

            (e) that arises  under a duly  authorized  Contract  that is in full
      force and effect and that is a legal,  valid and binding obligation of the
      related Obligor,  enforceable  against such Obligor in accordance with its
      terms,

            (f) that  conforms in all material  respects  with all  applicable
      laws, rulings and regulations in effect,

            (g) that is not the subject of any asserted dispute,  offset, hold
      back defense, Adverse Claim or other claim,

            (h) that satisfies all applicable  requirements  of the Credit and
      Collection Policy,

            (i) that has not been modified,  waived or restructured  since its
      creation, except as permitted pursuant to Section 4.2 of the Agreement,

            (j) in which the Seller  owns good and  marketable  title,  free and
      clear of any Adverse Claims,  and that is freely  assignable by the Seller
      (including without any consent of the related Obligor),

            (k)  for  which  the  Issuer  shall  have a  valid  and  enforceable
      undivided percentage ownership or security interest,  to the extent of the
      Purchased  Interest,  and a valid and enforceable first priority perfected
      security interest therein and in the Related Security and Collections with
      respect thereto, in each case free and clear of any Adverse Claim,

            (l) that  constitutes  an account as defined in the UCC,  and that
      is not evidenced by instruments or chattel paper,

            (m) that is not a Defaulted Receivable,

            (n)  for  which  none  of the  Originators,  the  Seller  nor  the
      Servicer  has  established  any  offset  arrangements  with the  related
      Obligor,

            (o)  for  which  the sum of  Delinquent  Receivables  and  Defaulted
      Receivables  of the related  Obligor do not exceed 25% of the  Outstanding
      Balance of all such Obligor's Receivables, and

            (p) that  represents  amounts earned and payable by the Obligor that
      are  not  subject  to  the  performance  of  additional  services  by  any
      Originator.

      "ERISA"  means the Employee  Retirement  Income  Security Act of 1974,  as
amended from time to time, and any successor statute of similar import, together
with the  regulations  thereunder,  in each case as in effect from time to time.
References to sections of ERISA also refer to any successor sections.

      "ERISA  Affiliate" means: (a) any corporation that is a member of the same
controlled  group of  corporations  (within the meaning of Section 414(b) of the
Internal Revenue Code) as the Seller, Servicer or any Originator, (b) a trade or
business (whether or not incorporated)  under common control (within the meaning
of Section 414(c) of the Internal Revenue Code) with the Seller, Servicer or any
Originator,  or (c) a member of the same  affiliated  service  group (within the
meaning of Section 414(m) of the Internal Revenue Code) as the Seller, Servicer,
any Originator, any corporation described in clause (a) or any trade or business
described in clause (b).

      "Eurodollar  Rate" means, for any Settlement  Period, an interest rate per
annum (rounded  upward to the nearest  1/16th of 1%) determined  pursuant to the
following formula:

                                             LIBOR

                  100% - Eurodollar Rate Reserve Percentage

where "Eurodollar Rate Reserve Percentage" means, for any Settlement Period, the
maximum  reserve  percentage  (expressed  as a  decimal,  rounded  upward to the
nearest 1/100th of 1%) in effect on the date LIBOR for such Settlement Period is
determined  under  regulations  issued from time to time by the Federal  Reserve
Board for determining the maximum reserve requirement  (including any emergency,
supplemental   or  other   marginal   reserve   requirement)   with  respect  to
"Eurocurrency"  funding  (currently  referred to as "Eurocurrency  liabilities")
having a term comparable to such Settlement Period.

      "Event of Bankruptcy"  means (a) any case, action or proceeding before any
court or other governmental  authority  relating to bankruptcy,  reorganization,
insolvency,  liquidation,  receivership,  dissolution,  winding-up  or relief of
debtors or (b) any general  assignment for the benefit of creditors of a Person,
composition,  marshalling of assets for creditors of a Person,  or other similar
arrangement in respect of its creditors  generally or any substantial portion of
its creditors; in each of cases (a) and (b) undertaken under U.S. Federal, state
or foreign law, including the U.S. Bankruptcy Code.

      "Excess  Concentration"  means  the  sum  of  the  amounts  by  which  the
Outstanding  Balance  of  Eligible  Receivables  of  each  Obligor  then  in the
Receivables Pool exceeds an amount equal to: (a) the  Concentration  Percentage,
for such  Obligor,  multiplied  by (b) the  Outstanding  Balance of all Eligible
Receivables then in the Receivables Pool.

      "Facility  Termination  Date" means the earliest to occur of: (a) November
30, 2004,(b) the date determined  pursuant to Section 2.2 of the Agreement,  (c)
the date the Purchase  Limit reduces to zero  pursuant to Section  1.1(b) of the
Agreement  and (d) the date that the  commitments  of the  Purchasers  terminate
under the Liquidity Agreement.

      "Federal  Funds Rate" means,  for any day, the per annum rate set forth in
the  weekly  statistical  release  designated  as  H.15(519),  or any  successor
publication,  published  by  the  Federal  Reserve  Board  (including  any  such
successor,  "H.15(519)")  for such  day  opposite  the  caption  "Federal  Funds
(Effective)."  If on any  relevant  day  such  rate  is  not  yet  published  in
H.15(519),  the rate for  such  day  will be the  rate  set  forth in the  daily
statistical  release  designated as the Composite 3:30 p.m.  Quotations for U.S.
Government Securities,  or any successor  publication,  published by the Federal
Reserve Bank of New York (including any such successor, the "Composite 3:30 p.m.
Quotations")  for such day under the caption  "Federal Funds Effective Rate." If
on any  relevant  day  the  appropriate  rate  is not yet  published  in  either
H.15(519) or the Composite 3:30 p.m.  Quotations,  the rate for such day will be
the arithmetic mean as determined by the Administrator of the rates for the last
transaction in overnight Federal funds arranged before 9:00 a.m. (New York time)
on that day by each of three leading  brokers of Federal funds  transactions  in
New York City selected by the Administrator.

      "Federal  Reserve  Board"  means the  Board of  Governors  of the  Federal
Reserve System, or any entity succeeding to any of its principal functions.

      "Fee Letter" has the meaning set forth in Section 1.5 of the Agreement.

      "Fees" means the fees payable by the Seller to the Administrator  pursuant
to the Fee Letter.

      "GAAP" means the generally  accepted United States  accounting  principles
promulgated  or  adopted by the  Financial  Accounting  Standards  Board and its
predecessors and successors from time to time.

      "Governmental  Authority"  means any  nation or  government,  any state or
other political  subdivision  thereof,  any central bank (or similar monetary or
regulatory   authority)  thereof,  any  body  or  entity  exercising  executive,
legislative,  judicial,  regulatory or administrative functions of or pertaining
to government,  including any court, and any Person owned or controlled, through
stock or capital ownership or otherwise, by any of the foregoing.

      "Group A Obligor" means any Obligor with a short-term  rating of at least:
(a) "A-1" by Standard & Poor's,  or if such  Obligor  does not have a short-term
rating from  Standard & Poor's,  a rating of "A+" or better by Standard & Poor's
on its long-term senior unsecured and uncredit-enhanced debt securities, and (b)
"P-1" by Moody's,  or if such  Obligor  does not have a  short-term  rating from
Moody's,  "A1" or  better by  Moody's  on its  long-term  senior  unsecured  and
uncredit-enhanced debt securities.

      "Group  B  Obligor"  means  an  Obligor,  not a  Group  A  Obligor  with a
short-term  rating  of at  least:  (a) "A-2" by  Standard  & Poor's,  or if such
Obligor does not have a short-term  rating from  Standard & Poor's,  a rating of
"BBB+"  to "A" by  Standard  & Poor's  on its  long-term  senior  unsecured  and
uncredit-enhanced debt securities,  and (b) "P-2" by Moody's, or if such Obligor
does not have a short-term rating from Moody's, "Baa1" to "A2" by Moody's on its
long-term senior unsecured and uncredit-enhanced debt securities.

      "Group B Obligor Percentage" means, at any time, for each Group B Obligor,
the  percentage  equivalent  of: (a) the  aggregate  Outstanding  Balance of the
Eligible  Receivables of such Group B Obligor less any Excess  Concentrations of
such Obligor,  divided by (b) the aggregate  Outstanding Balance of all Eligible
Receivables at such time.

      "Group C  Obligor"  means an  Obligor,  not a Group A  Obligor  or Group B
Obligor,  with a short-term  rating of at least: (a) "A-3" by Standard & Poor's,
or if such Obligor does not have a short-term  rating from Standard & Poor's,  a
rating of "BBB-" to "BBB" by Standard & Poor's on its long-term senior unsecured
and  uncredit-enhanced  debt  securities,  and (b) "P-3" by Moody's,  or if such
Obligor  does not have a  short-term  rating from  Moody's,  "Baa3" to "Baa2" by
Moody's  on  its  long-term   senior   unsecured  and   uncredit-enhanced   debt
securities."

      "Group C Obligor Percentage" means, at any time, for each Group C Obligor,
the  percentage  equivalent  of: (a) the  aggregate  Outstanding  Balance of the
Eligible  Receivables of such Group C Obligor less any Excess  Concentrations of
such Obligor,  divided by (b) the aggregate  Outstanding Balance of all Eligible
Receivables at such time.

      "Group D Obligor" means any Obligor that is not a Group A Obligor, Group B
Obligor or Group C Obligor.

      "Group D Obligor Percentage" means, at any time, for each Group D Obligor:
(a) the aggregate  Outstanding Balance of the Eligible Receivables of such Group
D Obligor less any Excess  Concentrations  of such  Obligor,  divided by (b) the
aggregate Outstanding Balance of all Eligible Receivables at such time.

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

      "Impermissible   Qualification"   means,   relative   to  the  opinion  or
certification of any independent public accountant as to any financial statement
of Seller,  Servicer,  any  Originator  or any other  Subsidiary or Affiliate of
Servicer, any qualification or exception to such opinion or certification:

            (i)  which is of a "going concern" or similar nature; or

            (ii) which  relates to the limited scope of  examination  of matters
      relevant  to  such   financial   statement   (other   than  any   standard
      qualification of such nature).

      "Indemnified  Amounts"  has the  meaning  set forth in Section  3.1 of the
Agreement.

      "Indemnified  Party"  has the  meaning  set  forth in  Section  3.1 of the
Agreement.

      "Independent  Director"  has the  meaning set forth in  paragraph  3(c) of
Exhibit IV to the Agreement.

      "Internal  Revenue  Code"  means the  Internal  Revenue  Code of 1986,  as
amended from time to time, and any successor statute of similar import, together
with the  regulations  thereunder,  in each case as in effect from time to time.
References to sections of the Internal  Revenue Code also refer to any successor
sections.

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

      "Issuer's  Share"  of any  amount  means  such  amount  multiplied  by the
Purchased Interest at the time of determination.

      "LIBOR"   means  the  rate  of  interest  per  annum   determined  by  the
Administrator to be the arithmetic mean (rounded upward to the nearest 1/16th of
1%) of the rates of  interest  per annum  notified to the  Administrator  by the
Reference  Bank  as the  rate  of  interest  at  which  dollar  deposits  in the
approximate amount of the Portion of Capital to be funded at the Eurodollar Rate
during  such  Settlement  Period  would be offered by major  banks in the London
interbank  market to such  Reference  Bank at its request at or about 11:00 a.m.
(London  time) on the  second  Business  Day  before  the  commencement  of such
Settlement Period.

      "Liquidity  Agent"  means  BNS in its  capacity  as  the  Liquidity  Agent
pursuant to the Liquidity Agreement.

      "Liquidity Agreement" means the Liquidity Asset Purchase Agreement,  dated
as of November 29, 1999,  among the purchasers  from time to time party thereto,
the Issuer and BNS, as  Administrator  and Liquidity  Agent,  as the same may be
further amended, supplemented or otherwise modified from time to time.

      "Lock-Box  Account"  means  an  account  maintained  at a  bank  or  other
financial institution for the purpose of receiving Collections.

      "Lock-Box  Agreement"  means an agreement,  in  substantially  the form of
Annex C to the Agreement, among the Seller, the Servicer and a Lock-Box Bank.

      "Lock-Box  Bank"  means any of the banks or other  financial  institutions
holding one or more Lock-Box Accounts.

      "Loss Reserve"  means,  on any date, an amount equal to (a) the Capital at
the close of business of the Servicer on such date multiplied by (b)(i) the Loss
Reserve  Percentage  on such  date  divided  by (ii) 1 minus  the  Loss  Reserve
Percentage on such date.

      "Loss Reserve  Percentage"  means, on any date, the greater of: (a) 12.0%,
(b) 2 times the  Delinquency  Ratio and (c) (i) the  product  of (x) 2 times the
highest  average  of the  Default  Ratios  for any three  consecutive  Reporting
Periods during the thirteen most recent Reporting Periods  multiplied by (y) the
aggregate  credit  sales made  during  the five most  recent  Reporting  Periods
divided by (ii) the Net Receivables Pool Balance on such date.

      "Material  Adverse  Effect" means,  relative to any Person with respect to
any event or circumstance, a material adverse effect on:

            (a) the assets,  operations,  business or  financial  condition of
      such Person and its consolidated Subsidiaries, taken as a whole,

            (b) the  ability  of any such  Person to perform  its  obligations
      under the Agreement or any other  Transaction  Document to which it is a
      party,
            (c)  the  validity  or  enforceability  of any  other  Transaction
      Document,  or  the  validity,  enforceability  or  collectibility  of  a
      material portion of the Pool Receivables, or

            (d) the  status,  perfection,  enforceability  or  priority of the
      Issuer's or the Seller's interest in the Pool Assets.

      "Monthly Report" means a report,  in substantially  the form of Annex A to
the Agreement, furnished to the Administrator pursuant to the Agreement.

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

      "Net  Receivables  Pool Balance"  means,  at any time: (a) the Outstanding
Balance of Eligible  Receivables  then in the  Receivables  Pool,  minus (b) the
Excess Concentration.

      "Notes" means short-term  promissory notes issued, or to be issued, by the
Issuer to fund its investments in accounts receivable or other financial assets.

      "Obligor" means,  with respect to any Receivable,  the Person obligated to
make payments pursuant to the Contract relating to such Receivable.

      "Originator" has the meaning set forth in the Purchase and Sale Agreement.

      "Originator Assignment Certificate" means the assignment, in substantially
the form of Exhibit E to the Purchase and Sale  Agreement,  evidencing  Seller's
ownership of the Receivables  generated by each  Originator,  as the same may be
amended, supplemented,  amended and restated, or otherwise modified from time to
time in accordance with the Sale Agreement.

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

      "Payment  Date" has the meaning  set forth in Section 1.4 of the  Purchase
and Sale Agreement.

      "Permitted  Investments"  means  certificates  of  deposit  that  are  not
represented by  instruments,  have a maturity of one week or less and are issued
by the  Collection  Account Bank (with respect to the investment of funds in the
Collection  Account) or The Bank of Nova  Scotia;  provided,  however,  that the
Administrator on behalf of Issuer) may, from time to time, upon the later of (x)
three  Business  Days' prior  written  notice to Servicer and (y) the end of the
current maturity period with respect to certificates of deposits  invested prior
to the  Servicers  receipt of such notice,  remove from the scope of  "Permitted
Investments"  certificates  of  deposit of any such  bank(s)  and with the prior
consent of the  Servicer  (which  consent  shall not be  unreasonably  withheld)
specify to be within such scope, certificates of deposit of any other bank.

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

      "Pool  Assets"  has  the  meaning  set  forth  in  Section  1.2(d)  of the
Agreement.

      "Pool Receivable" means a Receivable in the Receivables Pool.

      "Portion of Capital" means any separate portion of Capital being funded or
maintained by the Issuer (or its  successors or permitted  assigns) by reference
to a particular interest rate basis.

      "Program Support Agreement" means and includes the Liquidity Agreement and
any other agreement entered into by any Program Support Provider  providing for:
(a) the issuance of one or more letters of credit for the account of the Issuer,
(b) the  issuance of one or more surety  bonds for which the Issuer is obligated
to  reimburse  the  applicable   Program  Support   Provider  for  any  drawings
thereunder,  (c) the sale by the Issuer to any Program  Support  Provider of the
Purchased  Interest (or portions  thereof) and/or (d) the making of loans and/or
other  extensions  of  credit  to the  Issuer in  connection  with the  Issuer's
Receivables-securitization  program contemplated in the Agreement, together with
any letter of credit,  surety bond or other  instrument  issued  thereunder (but
excluding any discretionary advance facility provided by the Administrator).

      "Program Support  Provider" means and includes any Purchaser and any other
Person (other than any customer of the Issuer) now or hereafter extending credit
or having a  commitment  to extend  credit to or for the  account of, or to make
purchases from, the Issuer pursuant to any Program Support Agreement.

      "Purchase and Sale Agreement" means the Purchase and Sale Agreement, dated
as of November 29, 1999 among the Seller, the Originators named therein and IMO,
as such agreement may be amended, amended and restated,  supplement or otherwise
modified from time to time.

      "Purchase  and Sale  Indemnified  Amounts"  has the  meaning  set forth in
Section 9.1 of the Purchase and Sale Agreement.

      "Purchase and Sale Indemnified Party" has the meaning set forth in Section
9.1 of the Purchase and Sale Agreement.

      "Purchase and Sale Termination  Date" has the meaning set forth in Section
1.4 of the Purchase and Sale Agreement.

      "Purchase and Sale Termination Event" has the meaning set forth in Section
8.1 of the Purchase and Sale Agreement.

      "Purchase  Facility"  has the  meaning  set  forth in  Section  1.1 of the
Purchase and Sale Agreement.

      "Purchase Limit" means $35,000,000, as such amount may be reduced pursuant
to Section  1.1(b) of the  Agreement.  References  to the unused  portion of the
Purchase  Limit  shall  mean,  at any time,  the  Purchase  Limit minus the then
outstanding Capital.

      "Purchase  Price" has the meaning set forth in Section 2.1 of the Purchase
and Sale Agreement.

      "Purchase Report" has the meaning set forth in Section 2.1 of the Purchase
and Sale Agreement.

      "Purchased   Interest"  means,  at  any  time,  the  undivided  percentage
ownership  interest  in:  (a) each and every Pool  Receivable  now  existing  or
hereafter  arising,   (b)  all  Related  Security  with  respect  to  such  Pool
Receivables and (c) all Collections with respect to, and other proceeds of, such
Pool Receivables and Related Security.  Such undivided percentage interest shall
be computed as:

                              Capital + Total Reserves

                          Net Receivables Pool Balance

The Purchased Interest shall be determined from time to time pursuant to Section
1.3 of the Agreement.

      "Purchaser" has the meaning set forth in Section 5.3(b) of the Agreement.

      "Rating Agencies" means Moody's and Standard & Poor's.

      "Rating Agency  Condition" means, with respect to any event or occurrence,
receipt by the Issuer of written confirmation from Standard & Poor's and Moody's
that such event or occurrence shall not cause the rating on the then outstanding
Notes to be downgraded or withdrawn.

      "Receivable"  means any  indebtedness  and other  obligations  owed to the
Seller as assignee of each Originator or such Originator by, or any right of the
Seller or such  Originator  to payment from or on behalf of, an Obligor  whether
constituting an account, chattel paper, instrument or general intangible arising
in  connection  with  the sale of goods or the  rendering  of  services  by such
Originator,  and includes the  obligation to pay any finance  charges,  fees and
other charges with respect thereto.

      "Receivables  Pool"  means,  at any  time,  all of  the  then  outstanding
Receivables purchased or purported to be purchased by the Seller pursuant to the
Purchase and Sale Agreement prior to the Facility Termination Date.

      "Reference Bank" means BNS.

      "Related  Rights" has the meaning set forth in Section 1.1 of the Purchase
and Sale Agreement.

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

            (a) all of the Seller's, and each Originator's interest in any goods
      (including  returned  goods),  and  documentation  of title evidencing the
      shipment or storage of any goods (including  returned goods),  relating to
      any sale giving rise to such Receivable,

            (b) all  instruments  and  chattel  paper that may  evidence  such
      Receivable,

            (c) all  other  security  interests  or liens and  property  subject
      thereto from time to time purporting to secure payment of such Receivable,
      whether  pursuant to the Contract related to such Receivable or otherwise,
      together with all UCC financing  statements  or similar  filings  relating
      thereto, and

            (d) all of the Seller's and each Originator's rights,  interests and
      claims under the Contracts and all guaranties,  indemnities, insurance and
      other  agreements  (including  the related  Contract) or  arrangements  of
      whatever  character  from time to time  supporting or securing  payment of
      such Receivable or otherwise relating to such Receivable, whether pursuant
      to the Contract related to such Receivable or otherwise.

      "Reporting  Period"  means  each  period  commencing  on the  first day of
Seller's fiscal month and ending on the last day of such fiscal month.

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

      "Seller's  Share" of any  amount  means the  greater  of: (a) $0 and (b)
such amount minus the Issuer's Share.

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

      "Servicing  Fee" shall  mean the fee  referred  to in  Section  4.6 of the
Agreement.

      "Servicing Fee Rate" shall mean the rate referred to in Section 4.6 of the
Agreement.

      "Servicing  Fee Reserve" at any time means the sum of (a) the then accrued
and unpaid Servicing Fee plus (b) the product of (i) the Outstanding  Balance of
Pool  Receivables at such time,  times (ii) the product of (x) the Servicing Fee
Rate multiplied by (y) a fraction, the numerator of which is 1.5 times the Days'
Sales  Outstanding  (calculated  on the last day of the  most  recent  preceding
Reporting Period) and the denominator of which is 360.

      "Settlement  Date" means (a) prior to the Facility  Termination  Date, the
last day of each calendar  month (or if such day is not a Business Day, then the
next following Business Day) and (b) on and after the Facility Termination Date,
each day selected from time to time by the  Administrator  (it being  understood
that the Administrator may select such Settlement Date to occur as frequently as
daily),  or, in the  absence of any such  selection,  the day which would be the
Settlement  Date for such  Portion  of  Capital  pursuant  to clause (a) of this
definition.

      "Settlement  Period" means, with respect to each Portion of Capital of the
Purchased  Interest:  (a) with  respect to any Portion of Capital  funded by the
issuance of Notes,  (i) initially the period  commencing on (and  including) the
date of the initial purchase or funding of such Portion of Capital and ending on
(and including) the last day of the current calendar month, and (ii) thereafter,
each period  commencing on (and  including)  the first day after the last day of
the  immediately  preceding  Settlement  Period for such  Portion of Capital and
ending on (and including) the last day of the current  calendar  month;  and (b)
with respect to any Portion of Capital not funded by the issuance of Notes,  (i)
initially  the period  commencing  on (and  including)  the date of the  initial
purchase or funding of such Portion of Capital and ending on (but excluding) the
next following Settlement Date, and (ii) thereafter, each period commencing on a
Settlement  Date and ending on (but  excluding)  the next  following  Settlement
Date; provided, that

                  (i) any Settlement  Period (other than of one day) which would
            otherwise end on a day which is not a Business Day shall be extended
            to the next succeeding Business Day; provided,  however, if Discount
            in respect of such Settlement Period is computed by reference to the
            Eurodollar Rate, and such Settlement Period would otherwise end on a
            day which is not a Business Day, and there is no subsequent Business
            Day in the same calendar month as such day, such  Settlement  Period
            shall end on the next preceding Business Day;

                  (ii) in the case of any  Settlement  Period for any Portion of
            Capital  of  the  Purchased  Interest  which  commences  before  the
            Facility  Termination  Date  and  would  otherwise  end  on  a  date
            occurring  after the  Facility  Termination  Date,  such  Settlement
            Period shall end on such Facility  Termination Date and the duration
            of each  Settlement  Period which commences on or after the Facility
            Termination  Date shall be of such  duration as shall be selected by
            the Administrator; and

                  (iii) any  Settlement  Period in respect of which  Discount is
            computed  by  reference  to the CP  Rate  may be  terminated  at the
            election  of,  and  upon  notice  thereof  to  the  Seller,  by  the
            Administrator  any  time,  in which  case  the  Portion  of  Capital
            allocated to such terminated Settlement Period shall be allocated to
            a new Settlement  Period  commencing on (and  including) the date of
            such  termination  and ending on (but  excluding) the next following
            Settlement Date, and shall accrue Discount at the Alternate Rate and
            based on the Base Rate.

      "Solvent" means, with respect to any Person at any time, a condition under
which:

            (i) the fair value and present fair saleable  value of such Person's
      total assets is, on the date of determination,  greater than such Person's
      total liabilities  (including contingent and unliquidated  liabilities) at
      such time;

            (ii) the fair value and present fair saleable value of such Person's
      assets  is  greater  than the  amount  that will be  required  to pay such
      Person's probable  liability on its existing debts as they become absolute
      and matured  ("debts," for this purpose,  includes all legal  liabilities,
      whether matured or unmatured, liquidated or unliquidated, absolute, fixed,
      or contingent);

            (iii) such  Person is and shall  continue to be able to pay all of
      its liabilities as such liabilities mature; and

            (iv) such Person does not have unreasonably small capital with which
      to engage in its current and in its anticipated business.

      For purposes of this definition:

            (A) the amount of a Person's contingent or unliquidated  liabilities
      at any time  shall be that  amount  which,  in light of all the  facts and
      circumstances then existing, represents the amount which can reasonably be
      expected to become an actual or matured liability;

            (B) the "fair  value" of an asset  shall be the amount  which may be
      realized  within a reasonable  time either  through  collection or sale of
      such asset at its regular market value;

            (C) the "regular market value" of an asset shall be the amount which
      a capable and diligent business person could obtain for such asset from an
      interested  buyer who is willing to  purchase  such asset  under  ordinary
      selling conditions; and

            (D) the "present fair  saleable  value" of an asset means the amount
      which can be obtained if such asset is sold with reasonable  promptness in
      an arm's-length transaction in an existing and not theoretical market.

      "Standard & Poor's" means Standard & Poor's, a division of The McGraw-Hill
Companies, Inc.

      "Subsidiary" means, as to any Person, a corporation,  partnership, limited
liability  company  or other  entity of which  shares of stock of each  class or
other  interests  having  ordinary  voting  power  (other  than  stock  or other
interests having such power only by reason of the happening of a contingency) to
elect a majority of the Board of Directors or other  managers of such entity are
at the time owned, or management of which is otherwise  controlled:  (a) by such
Person, (b) by one or more Subsidiaries of such Person or (c) by such Person and
one or more Subsidiaries of such Person.

      "Termination  Day" means: (a) each day on which the conditions set forth
in Section 2 of Exhibit II to the  Agreement are not satisfied or (b) each day
that occurs on or after the Facility Termination Date.

      "Termination  Event"  has  the  meaning  specified  in  Exhibit  V to  the
Agreement.

      "Termination  Fee"  means,  for  any  Settlement  Period  during  which  a
Termination  Day  occurs,  the  amount,  if any,  by which:  (a) the  additional
Discount  (calculated  without  taking into account any  Termination  Fee or any
shortened duration of such Settlement Period pursuant to the definition thereof)
that would have  accrued  during such  Settlement  Period on the  reductions  of
Capital  relating to such  Settlement  Period had such reductions not been made,
exceeds  (b) the income,  if any,  received  by the Issuer  from  investing  the
proceeds of such  reductions of Capital,  as  determined  by the  Administrator,
which  determination  shall be binding and conclusive  for all purposes,  absent
manifest error.

      "Total  Reserves"  means,  at any time the sum of : (a) the Yield Reserve,
plus (b) Servicing Fee Reserve, plus (c) the Loss Reserve, plus (d) the Dilution
Reserve, plus (e) the Accrued Customer Rebate Reserve.

      "Transaction Documents" means the Agreement, the Lock-Box Agreement(s) and
the  Collection  Account  Agreement,  the Fee  Letter,  the  Purchase  and  Sale
Agreement and all other  certificates,  instruments,  UCC financing  statements,
reports,  notices,  agreements and documents  executed or delivered  under or in
connection  with  the  Agreement,  in each  case  as the  same  may be  amended,
supplemented  or otherwise  modified  from time to time in  accordance  with the
Agreement.

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

      "Unmatured  Purchase  and Sale  Termination  Event" means any event which,
with the giving of notice or lapse of time, or both, would become a Purchase and
Sale Termination Event.

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

      "Yield Reserve" means, at any time:

                        ( BR  x 1.5(DSO) x Capital)
                          360
      where:

            BR    =     the Base Rate in effect at such time, and

            DSO   =     Days' Sales Outstanding.

      Other Terms. All accounting terms not specifically defined herein shall be
construed in accordance with generally accepted accounting principles. All terms
used in  Article  9 of the UCC in the State of New  York,  and not  specifically
defined herein, are used herein as defined in such Article 9. Unless the context
otherwise  requires,  "or" means "and/or," and "including" (and with correlative
meaning   "include"  and  "includes")   means  including  without  limiting  the
generality of any description preceding such term.

                                   EXHIBIT II

                             CONDITIONS OF PURCHASES

      I. Conditions Precedent to Initial Purchase. The initial purchase
  under this Agreement is subject to the following conditions precedent that
the  Administrator  shall have received on or before the date of such  purchase,
 each in form and substance (including the date thereof) satisfactory to the

                                 Administrator:

         A. A counterpart of the Agreement and the other Transaction
                  Documents executed by the parties thereto.

         A. Certified copies of: (i) the resolutions of the Board of
Directors of each of the Seller, the Servicer and each Originator authorizing
 the execution, delivery and performance by the Seller, the Servicer and such
  Originator, as the case may be, of the Agreement and the other Transaction
    Documents  to which  it is a party;  (ii)  all  documents  evidencing  other
 necessary organizational or corporate action and governmental approvals, if

  any, with respect to the Agreement and the other Transaction Documents and
 (iii) the certificate of incorporation and by-laws or the limited liability
    company agreement, as applicable, of the Seller, the Servicer and such
                                 Originator.

       A. A certificate of the Secretary or Assistant Secretary of the
    Seller, the Servicer and each Originator certifying the names and true
 signatures of its officers who are authorized to sign the Agreement and the
  other Transaction Documents. Until the Administrator receives a subsequent
 incumbency  certificate from the Seller,  the Servicer and such Originator,  as
the case may be, the Administrator shall be entitled to rely on the last such

 certificate delivered to it by the Seller, the Servicer and such Originator,
                             as the case may be.

     A. Acknowledgment copies, or time stamped receipt copies, of proper
    financing statements, duly filed on or before the date of such initial
 purchase under the UCC of all jurisdictions that the Administrator may deem
  necessary or desirable in order to perfect the interests of the Seller and
the Issuer contemplated by the Agreement, the Purchase and Sale Agreement and
                             the Sale Agreement.

     A. Acknowledgment copies, or time-stamped receipt copies, of proper
financing statements, if any, necessary to release all security interests and
 other       rights  of any  Person in the  Receivables,  Contracts  or  Related
             Security previously granted by any Originator or the Seller.

       A. Completed UCC search reports, dated on or shortly before the
   date of the initial purchase hereunder, listing the financing statements
  filed in all applicable jurisdictions referred to in subsection (e) above that
  name, any Originator or the Seller as debtor, together with copies of

 such other  financing  statements,  and similar  search reports with respect to
 judgment liens, federal tax liens and liens of the Pension Benefit Guaranty

    Corporation in  such  jurisdictions,  as the  Administrator  may  reasonably
            request, showing no Adverse Claims on any Pool Assets.

      A. copies of the executed (i) Lock-Box Agreement with the Lock-Box
 Bank and (ii) Collection Account Agreement with the Collection Account Bank.

           A. Favorable opinions, in form and substance reasonably
  satisfactory to the Administrator, of Hogan & Hartson LLP, special counsel
                  for Seller, Servicer and each Originator.

         A. Satisfactory results of a review and audit (performed by
representatives of the Administrator) of the Servicer's collection, operating
 and reporting  systems,  the Credit and Collection  Policy of each  Originator,
historical receivables data and accounts, including satisfactory results of a

  review of the Servicer's operating location(s) and satisfactory review and
 approval of the Eligible Receivables in existence on the date of the initial
                        purchase under the Agreement.

      A. A pro forma Monthly Report representing the performance of the
          Receivables Pool for the Reporting Period before closing.

     A. Evidence of payment by the Seller of all accrued and unpaid fees
 (including those contemplated by the Fee Letter), costs and expenses to the
  extent then due and  payable on the date  thereof,  including  any such costs,
fees and expenses arising under or referenced in Section 5.4 of the Agreement

                               and the Fee Letter.

       A. The Fee Letter duly executed by the Seller and the Servicer.

      A. Good standing certificates with respect to each of the Seller,
each Originator and the Servicer issued by the Secretary of State (or similar
official) of the state of each such Person's organization and principal place
                                 of business.

      A. Letters from each of the rating agencies then rating the Notes
  confirming the rating of such Notes after giving effect to the transaction
                        contemplated by the Agreement.

     A. The Liquidity Agreement and all other Transaction Documents duly
                       executed by the parties thereto.

          A. A file (computer generated or otherwise) containing all
   information with respect to the Receivables as the Administrator or the
                        Issuer may reasonably request.

     A. Such other approvals, opinions or documents as the Administrator
                    or the Issuer may reasonably request.

       I. Conditions Precedent to All Purchases and Reinvestments. Each
 purchase (except as to clause (a), including the initial purchase) and each
   reinvestment shall be subject to the further conditions precedent that:

      A. in the case of each purchase, the Servicer shall have delivered
    to the Administrator on or before such purchase, in form and substance
  satisfactory  to the  Administrator,  a completed pro forma Monthly  Report to
   reflect the level of Capital and related reserves after such subsequent

                                  purchase; and

        A. on the date of such purchase or reinvestment the following
 statements shall be true (and acceptance of the proceeds of such purchase or
reinvestment           shall be  deemed a  representation  and  warranty  by the
                       Seller that such statements are then true):

      1. the representations and warranties contained in Exhibit III to
 the Agreement are true and correct in all material respects on and as of the
 date of such purchase or reinvestment as though made on and as of such date;
                                       and

       1. no event has occurred and is continuing, or would result from
  such purchase or reinvestment, that constitutes a Termination Event or an
                          Unmatured Termination Event.

                                   EXHIBIT III

                         REPRESENTATIONS AND WARRANTIES

       1. Representations and Warranties of the Seller. The Seller represents
                           and warrants as follows:

         A. The Seller is a limited liability company duly organized,
     validly existing and in good standing under the laws of the State of
 Delaware,  and is duly  qualified to do business  and is in good  standing as a
 foreign limited liability company in every jurisdiction where the nature of its
 business requires it to be so qualified, except where the failure to be

            so qualified would not have a Material Adverse Effect.

       A. The execution, delivery and performance by the Seller of the
    Agreement and the other Transaction Documents to which it is a party,
  including its use of the proceeds of purchases and reinvestments: (i) are
   within its organizational powers; (ii) have been duly authorized by all
   necessary organizational action; (iii) do not contravene or result in a
  default under or conflict with: (A) its certificate of formation, limited
   liability company agreement or any other organizational document of the
 Seller,  (B) any law, rule or regulation  applicable to it, (C) any  indenture,
 loan agreement, mortgage, deed of trust or other agreement or instrument to

     which it is a party or by which it is bound, or (D) any order, writ,
  judgment, award, injunction or decree binding on or affecting it or any of
    its property; and (iv) do not result in or require the creation of any
  Adverse Claim upon or with respect to any of its properties. The Agreement
  and the other Transaction Documents to which it is a party have been duly
                    executed and delivered by the Seller.

      A. No authorization, approval or other action by, and no notice to
  or filing with, any Governmental Authority or other Person is required for
its due execution, delivery and performance by the Seller of the Agreement or
any other Transaction Document to which it is a party, other than the Uniform
  Commercial  Code filings  referred to in Exhibit II to the  Agreement,  all of
   which shall have been filed on or before the date of the first purchase

                                   hereunder.

       A. Each of the Agreement and the other Transaction Documents to
     which the Seller is a party constitutes the legal, valid and binding
  obligation of the Seller enforceable against the Seller in accordance with
its terms, except as enforceability may be limited by bankruptcy, insolvency,
  reorganization or other similar laws from time to time in effect affecting the
 enforcement of creditors' rights generally and by general principles of

     equity, regardless of whether such enforceability is considered in a
                       proceeding in equity or at law.
      B. There is no pending or, to Seller's best knowledge, threatened
  action or proceeding affecting Seller or any of its properties before any
                      Governmental Authority or arbitrator.

      A. No proceeds of any purchase or reinvestment will be used by the
 Seller to acquire any equity security of a class that is registered pursuant
            to Section 12 of the Securities Exchange Act of 1934.

         A. The Seller is the legal and beneficial owner of the Pool
 Receivables and Related Security, free and clear of any Adverse Claim. Upon
     each  purchase  or  reinvestment,  the  Issuer  shall  acquire  a valid and
enforceable perfected undivided percentage ownership or security interest, to

 the extent of the Purchased Interest,  in each Pool Receivable then existing or
   thereafter  arising  and in  the  Related  Security,  Collections  and  other
   proceeds  with  respect  thereto,  free and clear of any Adverse  Claim.  The
   Agreement creates a security interest in favor of the Issuer in the Pool

  Assets, and the Issuer has a first priority perfected security interest in the
Pool  Assets,  free and clear of any  Adverse  Claims.  No  effective  financing
statement or other instrument similar in effect covering any Pool Asset is on

   file in any  recording  office,  except  those  filed in favor of the  Seller
  pursuant to the Purchase and Sale Agreement and the Issuer relating to the

                                   Agreement.

       A. Each Monthly Report (if prepared by the Seller or one of its
 Affiliates, or to the extent that information contained therein is supplied
  by the Seller or an Affiliate), information, exhibit, financial statement,
 document, book, record or report furnished or to be furnished at any time by
    or on  behalf of the  Seller to the  Administrator  in  connection  with the
Agreement or any other Transaction Document to which it is a party is or will be
complete and accurate in all material respects as of its date or as of the

                              date so furnished,

       A. The Seller's principal place of business and chief executive
 office (as such terms are used in the UCC) and the office where it keeps its
 records concerning the Receivables are located at the address referred to in
            Sections 1(b) and 2(b) of Exhibit IV to the Agreement.

     A. The names and addresses of all the Lock-Box Banks, together with
   the account numbers of the Lock-Box Accounts at such Lock-Box Banks, are
  specified in Schedule II to the  Agreement  (or at such other  Lock-Box  Banks
    and/or with such other Lock-Box Accounts as have been notified to the

Administrator          in  accordance  with  the  Agreement)  and  all  Lock-Box
                       Accounts are subject to Lock-Box Agreements.

         A. The Seller is not in violation of any order of any court,
                    arbitrator or Governmental Authority.
     B. No proceeds of any purchase or reinvestment will be used for any
   purpose that violates any applicable law, rule or regulation, including
               Regulations G or U of the Federal Reserve Board.

      A. Each Pool Receivable included as an Eligible Receivable in the
  calculation of the Net Receivables Pool Balance is an Eligible Receivable.

      A. No event has occurred and is continuing, or would result from a
purchase in respect of, or reinvestment in respect of, the Purchased Interest
    or       from the application of the proceeds therefrom,  that constitutes a
             Termination Event or an Unmatured Termination Event.

     A. The Seller has complied in all material respects with the Credit
   and Collection Policy of each Originator with regard to each Receivable
                        originated by such Originator.

     A. The Seller has complied in all material respects with all of the
   terms, covenants and agreements contained in the Agreement and the other
               Transaction Documents that are applicable to it.

       A. The Seller's complete organizational name is set forth in the
  preamble to the Agreement, and it does not use and has not during the last
  five years used any other organizational name, trade name, doing-business
name or  fictitious  name,  except as set forth on Schedule III to the Agreement
and except for names first used after the date of the Agreement and set forth

  in a notice delivered to the Administrator pursuant to Section 1(k)(iv) of
                         Exhibit IV to the Agreement.

          A. The Seller is not an "investment company," or a company
 "controlled" by an "investment company" within the meaning of the Investment
  Company Act of 1940, as amended. In addition, the Seller is not a "holding
 company," a "subsidiary company" of a "holding company" or an "affiliate" of
   a "holding  company"  or of a  "subsidiary  company"  of a "holding  company"
   within the meaning of the Public Utility Holding Company Act of 1935, as

                                    amended.

           (s)  The  Seller  reasonably  believes  that  all  internal  computer
   operations that are material to its business operations will be able to

 perform  properly date sensitive  functions for all dates before,  on and after
   January 1, 2000, except to the extent that a failure to do so could not

          reasonably be expected to have a Material Adverse Effect.

      2. Representations and Warranties of IMO (including in its capacity as
    the Servicer). IMO, individually and in its capacity as the Servicer,
                     represents and warrants as follows:

      A. IMO is a corporation duly incorporated, validly existing and in
 good standing under the laws of the State of Delaware, and is duly qualified
   to do  business  and is in good  standing as a foreign  corporation  in every
jurisdiction  where the nature of its business  requires it to be so  qualified,
except where the failure to be so qualified would not have a Material Adverse

                                     Effect.

      A. The execution, delivery and performance by IMO of the Agreement
  and the other Transaction Documents to which it is a party, including the
Servicer's use of the proceeds of purchases and reinvestments: (i) are within
    its corporate powers; (ii) have been duly authorized by all necessary
  corporate action; (iii) do not contravene or result in a default under or
  conflict with: (A) its charter or by-laws, (B) any law, rule or regulation
 applicable to it, (C) any indenture, loan agreement, mortgage, deed of trust or
 other material agreement or instrument to which it is a party or by which

  it is bound, or (D) any order,  writ,  judgment,  award,  injunction or decree
 binding on or affecting it or any of its property; and (iv) do not result in or
 require the creation of any Adverse Claim upon or with respect to any of

  its    properties.  The Agreement and the other Transaction Documents to which
         IMO is a party have been duly executed and delivered by IMO.

      A. No  authorization,  approval  or other  action  by, and no notice to or
  filing with any  Governmental  Authority or other Person,  is required for the
  due execution,  delivery and  performance by IMO of the Agreement or any other
  Transaction Document to which it is a party, other than the Uniform Commercial
  Code filings referred to in Exhibit II to the Agreement, all of

   which                          shall have been filed on or before the date of
                                  the first purchase hereunder.

       A. Each of the Agreement and the other Transaction Documents to
 which IMO is a party constitutes the legal, valid and binding obligation of
     IMO  enforceable  against  IMO in  accordance  with its  terms,  except  as
  enforceability may be limited by bankruptcy, insolvency, reorganization or

 other  similar laws from time to time in effect  affecting the  enforcement  of
 creditors' rights generally and by general principles of equity,  regardless of
 whether such enforceability is considered in a proceeding in equity or at

                                      law.

      A. The balance sheets of IMO and its consolidated Subsidiaries as
   at December 31, 1998, and the related statements of income and retained
 earnings for the fiscal year then ended, copies of which have been furnished to
 the  Administrator,  fairly  present  the  financial  condition  of IMO and its
 consolidated Subsidiaries as at such date and the results of the operations

    of IMO and its Subsidiaries for the period ended on such date, all in
    accordance with generally accepted accounting principles consistently
applied,          and  since  December  31,  1998  there  has  been no  event or
                  circumstances which have had a Material Adverse Effect.

         A. Except as disclosed in the most recent audited financial
 statements of IMO furnished to the Administrator, there is no pending or, to
  its best knowledge, threatened action or proceeding affecting it or any of
 its Subsidiaries before any Governmental Authority or arbitrator that could
                         have a Material Adverse Effect.

           A. Each Monthly Report (if prepared by IMO or one of its
 Affiliates, or to the extent that information contained therein is supplied
by IMO or an Affiliate), information, exhibit, financial statement, document,
   book, record or report furnished or to be furnished at any time by or on
 behalf of the Servicer to the Administrator in connection with the Agreement
 is or will be complete and accurate in all material respects as of its date
  or (except as otherwise disclosed to the Administrator at such time) as of
                            the date so furnished.

     A. IMO is not in violation of any order of any court, arbitrator or
     Governmental Authority, which could have a Material Adverse Effect.

        A. The Servicer has complied in all material respects with the
     Credit and Collection Policy of each Originator with regard to each
                  Receivable originated by such Originator.

       (j) IMO reasonably  believes that all internal  computer  operations that
are material to its business operations will be able to perform properly date

   sensitive  functions  for all dates  before,  on and after  January  1, 2000,
except to the extent that a failure to do so could not reasonably be expected

                       to have a Material Adverse Effect.

                                   EXHIBIT IV

                                    COVENANTS

            1. Covenants of the Seller. Until the latest of the Facility
 Termination Date, the date on which no Capital of or Discount in respect of
  the Purchased Interest shall be outstanding or the date all other amounts
 owed by the Seller under the Agreement to the Issuer, the Administrator and
    any other Indemnified Party or Affected Person shall be paid in full:

         A. Compliance with Laws, Etc. The Seller shall comply in all
  material respects with all applicable laws, rules, regulations and orders,
 and preserve and maintain its  organizational  existence,  rights,  franchises,
  qualifications  and  privileges,  except to the extent  that the failure so to
  comply with such laws, rules and regulations or the failure so to preserve

and                    maintain  such  rights,  franchises,  qualifications  and
                       privileges would not have a Material Adverse Effect.

        A. Offices, Records and Books of Account, Etc. The Seller: (i)
  shall keep its principal place of business and chief executive office (as
   such  terms or  similar  terms are used in the UCC) and the  office  where it
keeps its records concerning the Receivables at the address of the Seller set

 forth under its name on the signature  page to the  Agreement  or,  pursuant to
   clause (k)(iv) below, at any other locations in jurisdictions where all

 actions reasonably requested by the Administrator to protect and perfect the
  interest of the Issuer in the Receivables and related items (including the
    Pool  Assets)  have been  taken and  completed  and (ii) shall  provide  the
 Administrator with at least 30 days' written notice before making any change in
 the Seller's name or making any other change in the Seller's identity or

  organizational structure (including a Change in Control) that could render any
     UCC financing statement filed in connection with this Agreement

  "seriously misleading" as such term (or similar term) is used in the UCC; each
  notice to the  Administrator  pursuant  to this  sentence  shall set forth the
  applicable change and the effective date thereof. The Seller also will

   maintain and implement (or cause the Servicer to maintain and implement)
  administrative and operating procedures (including an ability to recreate
   records evidencing Receivables and related Contracts in the event of the
  destruction of the originals thereof), and keep and maintain (or cause the
 Servicer to keep and maintain) all documents,  books,  records,  computer tapes
  and disks and other information reasonably necessary or advisable for the

collection of all Receivables (including records adequate to permit the daily
 identification of each Receivable and all Collections of and adjustments to
                          each existing Receivable).

         A. Performance and Compliance with Contracts and Credit and
 Collection Policy. The Seller shall (and shall cause the Servicer to) fully
  comply in all material  respects  with the  applicable  Credit and  Collection
      Policies with regard to each Receivable and the related Contract.

      A. Ownership Interest, Etc. The Seller shall (and shall cause the
   Servicer to), at its expense, take all action necessary or desirable to
establish and maintain a valid and enforceable undivided percentage ownership
  or security interest, to the extent of the Purchased Interest, in the Pool
Receivables,  the Related Security and Collections  with respect thereto,  and a
 first priority perfected security interest in the Pool Assets, in each case

free and clear of any Adverse Claim,  in favor of the Issuer,  including  taking
  such action to perfect, protect or more fully evidence the interest of the

   Issuer as the Issuer, through the Administrator, may reasonably request.

         A. Sales, Liens, Etc. The Seller shall not sell, assign (by
 operation of law or otherwise) or otherwise dispose of, or create or suffer
 to exist any Adverse Claim upon or with respect to, any or all of its right,
  title or interest in, to or under any Pool Assets (including the Seller's
  undivided interest in any Receivable, Related Security or Collections, or
     upon or with respect to any account to which any Collections of any
  Receivables are sent), or assign any right to receive income in respect of
                  any items contemplated by this paragraph.

     A. Extension or Amendment of Receivables. Except as provided in the
Agreement, the Seller shall not, and shall not permit the Servicer to, extend
 the maturity or adjust the Outstanding Balance or otherwise modify the terms of
  any Pool Receivable, or amend, modify or waive any term or condition of

                              any related Contract.

       A. Change in Credit and Collection Policy. The Seller shall not
 make (or permit any Originator to make) any material change in the character
 of its business or in the Credit and Collection Policy, or any change in the
 Credit and Collection Policy that would adversely affect the collectibility
 of the Receivables Pool or the enforceability of any related Contract or the
    ability        of the Seller or Servicer to perform  its  obligations  under
                   any related Contract or under the Agreement.

       A. Audits. The Seller shall (and shall cause each Originator to)
 from time to time during regular business hours, as reasonably requested in
advance (unless a Termination  Event or Unmatured  Termination  Event exists) by
the Administrator permit the Administrator, or its agents or representatives:

 (i) to examine and make  copies of and  abstracts  from all books,  records and
documents (including computer tapes and disks) in the possession or under the

  control of the Seller (or such Originator) relating to Receivables and the
   Related Security, including the related Contracts, and (ii) to visit the
 offices and properties of the Seller and each Originator for the purpose of
    examining such materials described in clause (i) above, and to discuss
  matters relating to Receivables and the Related Security or the Seller's,
 Servicer's or such Originator's performance under the Transaction Documents
    or under the Contracts with any of the officers, employees, agents or
  contractors of the Seller, Servicer or such Originator having knowledge of
                                such matters.

         A. Change in Lock-Box Banks, Lock-Box Accounts and Payment
   Instructions to Obligors. The Seller shall not, and shall not permit the
 Servicer or any  Originator to, add or terminate any bank as a Lock-Box Bank or
 any account as a Lock-Box Account from those listed in Schedule II to the

   Agreement, or make any change in its instructions to Obligors regarding
    payments to be made to the Seller, any Originator, the Servicer or any
Lock-Box Account (or related post office box),  unless the  Administrator  shall
 have  consented  thereto in writing and the  Administrator  shall have received
 copies of all agreements and documents (including Lock-Box Agreements) that

                   it may request in connection therewith.

      A. Deposits to Lock-Box Accounts. The Seller shall (or shall cause
     the Servicer to): (i) instruct all Obligors to make payments of all
Receivables  to one or more  Lock-Box  Accounts or to post office boxes to which
  only  Lock-Box  Banks have access (and shall  instruct the  Lock-Box  Banks to
  cause all items and amounts relating to such Receivables received in such post
  office boxes to be removed and  deposited  into a Lock-Box  Account on a daily
  basis), and (ii) deposit, or cause to be deposited,  any Collections  received
  by it, the Servicer or any Originator into Lock-Box Accounts not

 later than one Business Day after receipt thereof. Each Lock-Box Account and
 the Collection Account shall at all times be subject to a Lock-Box Agreement
  and a Collection Account Agreement, respectively. The Seller will not (and
  will not permit the Servicer to) deposit or otherwise credit, or cause or
 permit                to be so deposited or credited,  to any Lock-Box  Account
                       cash or cash proceeds other than Collections.

          A. Reporting Requirements. The Seller will provide to the
  Administrator (in multiple copies, if requested by the Administrator) the
                                   following:

      1. as soon as available  and in any event within 120 days after the end of
 each fiscal year of the Seller,  a copy of the annual  report for such year for
 the Seller,  containing  unaudited financial statements for such year certified
 as to accuracy by the chief financial officer or treasurer of the

                                     Seller;

      1. as soon as possible and in any event within five days after the
Seller becomes aware of the occurrence of each Termination Event or Unmatured
 Termination  Event,  a statement of the chief  financial  officer of the Seller
   setting  forth  details of such  Termination  Event or Unmatured  Termination
   Event and the action that the Seller has taken and proposes to take with

                               respect thereto;

       1. promptly after the filing or receiving thereof, copies of all
 reports and notices that the Seller or any Affiliate files under ERISA with
the Internal Revenue Service, the Pension Benefit Guaranty Corporation or the
  U.S. Department of Labor or that the Seller or any Affiliate receives from
  any of the foregoing or from any multiemployer plan (within the meaning of
 Section 4001(a)(3) of ERISA) to which the Seller or any of its Affiliates is or
  was, within the preceding five years, a contributing employer, in each

   case in respect of the assessment of withdrawal liability or an event or
condition that could, in the aggregate, result in the imposition of liability
                   on the Seller and/or any such Affiliate;

      1. at least thirty days before any change in the Seller's name or
   any other change requiring the amendment of UCC financing statements, a
      notice setting forth such changes and the effective date thereof;

      1. promptly after the Seller obtains knowledge thereof, notice of
 any: (A) material litigation, investigation or proceeding that may exist at
   any time between the Seller and any Person or (B) material litigation or
               proceeding relating to any Transaction Document;

        1. promptly after the occurrence thereof, notice of a material
  adverse change in the business, operations, property or financial or other
           condition of the Seller, the Servicer or any Originator;

         1. such other information respecting the Receivables or the
 condition or operations, financial or otherwise, of the Seller or any of its
Affiliates as the Administrator may from time to time reasonably request; and

               (viii)  as soon as  available  and in any event  within  140 days
       after the end of each fiscal  year of Seller,  the Seller  shall,  at the
       Seller's expense, cause a firm of independent public accountants (who may
       be the independent public accountants who verify the IMO's annual

            audited financial statements), reasonably acceptable to the
       Administrator, to furnish a report to the Administrator, to the effect
          that such  firm has (i)  compared  the  information  contained  in the
       Monthly  Reports  delivered  during  such fiscal year then ended with the
       information contained in the Seller's records and computer systems for

      such period, and that, on the basis of such examination and comparison,
         such firm is of the opinion that the information contained in the
          Monthly  Reports  reconciles  with the  information  contained  in the
        Seller's records and computer systems and that the servicing of the

       Receivables has been  conducted in compliance  with the  Agreement,  (ii)
          confirmed the Net Receivables Pool Balance as of the end of each

         Settlement  Period  during such fiscal year,  (iii)  verified  that the
         Receivables  treated  by the  Seller as  Eligible  Receivables  in fact
         satisfied the requirements of the definition thereof contained in

             Exhibit  I  to  the  Agreement,  and  (iv)  conducted  a  "negative
      confirmation" of a sample of Receivables and verified that the Seller's

           records and computer systems used in servicing the Receivables
       contained correct information with regard to due dates and outstanding
         balances,  except  in each  case for (a) such  exceptions  as such firm
            shall believe to be immaterial (which exceptions need not be

      enumerated) and (b) such other exceptions as shall be set forth in such
                                     statement.

       A. Certain Agreements. Without the prior written consent of the
  Administrator, the Seller will not (and will not permit any Originator to)
 amend, modify, waive, revoke or terminate any Transaction Document to which
  it is a party or any provision of Seller's certificate of incorporation or
                                   by-laws.

      A. Restricted Payments. (i) Except pursuant to clause (ii) below,
 the Seller will not: (A) purchase or redeem any shares of its capital stock,
 (B) declare or pay any dividend or set aside any funds for any such purpose,
  (C) prepay,  purchase or redeem any Debt, (D) lend or advance any funds or (E)
  repay any loans or advances to, for or from any of its Affiliates (the

amounts                          described  in  clauses  (A)  through  (E) being
                                 referred to as "Restricted Payments").

             (ii)  Subject to the  limitations  set forth in clause (iii) below,
         the Seller may make Restricted Payments so long as such Restricted

        Payments are made only in one or more of the following ways: (A) the
        Seller may make cash payments (including prepayments) on the Company
         Notes in  accordance  with its terms,  and (B) if no  amounts  are then
        outstanding under the Company Notes, the Seller may declare and pay

                                     dividends.

              (iii) The Seller may make Restricted Payments only out of the
         funds it receives pursuant to Sections 1.4(b)(ii) and (iv) of the
       Agreement. Furthermore, the Seller shall not pay, make or declare: (A)
      any dividend if, after giving effect thereto, the Seller's tangible net
         worth  would be less than  $2,000,000,  or (B) any  Restricted  Payment
           (including any dividend) if, after giving effect thereto, any

        Termination              Event or Unmatured Termination Event shall have
                                 occurred and be continuing.

      A. Other Business. The Seller will not: (i) engage in any business
 other than the transactions contemplated by the Transaction Documents; (ii)
 create, incur or permit to exist any Debt of any kind (or cause or permit to
   be issued for its  account  any  letters of credit or  bankers'  acceptances)
other than pursuant to this Agreement or the Company Notes; or (iii) form any

  Subsidiary or make any  investments  in any other Person;  provided,  however,
that the Seller shall be permitted to incur minimal obligations to the extent

 necessary for the  day-to-day  operations  of the Seller  (such as expenses for
           stationery, audits, maintenance of legal status, etc.).

     A. Use of Seller's Share of Collections. The Seller shall apply the
   Seller's Share of Collections to make payments in the following order of
 priority: (i) the payment of its expenses (including all obligations payable
  to the Issuer and the Administrator under the Agreement and under the Fee
   Letter);  (ii) the  payment of accrued  and unpaid  interest  on the  Company
 Notes; (iii) the payment of principal of the Notes and (iv) other legal and

                        valid organizational purposes.

      A. Tangible Net Worth. The Seller will not permit its tangible net
               worth, at any time, to be less than $2,000,000.

       2. Covenants of the Servicer and IMO. Until the latest of the Facility
 Termination Date, the date on which no Capital of or Discount in respect of
  the Purchased Interest shall be outstanding or the date all other amounts
 owed by the Seller under the Agreement to the Issuer, the Administrator and
    any other Indemnified Party or Affected Person shall be paid in full:

      A. Compliance with Laws, Etc. The Servicer and, to the extent that
     it ceases to be the Servicer, IMO shall comply (and shall cause each
   Originator  to comply) in all material  respects  with all  applicable  laws,
    rules, regulations and orders, and preserve and maintain its corporate

 existence,  rights,  franchises,  qualifications and privileges,  except to the
extent that the failure so to comply with such laws, rules and regulations or

 the failure so to preserve and maintain  such  existence,  rights,  franchises,
   qualifications and privileges would not have a Material Adverse Effect.

        A. Records and Books of Account, Etc. The Servicer and, to the
extent that it ceases to be the Servicer, IMO, also will (and will cause each
Originator to) maintain and implement administrative and operating procedures
 (including an ability to recreate records evidencing Receivables and related
Contracts in the event of the destruction of the originals thereof), and keep
   and maintain all  documents,  books,  records,  computer  tapes and disks and
other  information  reasonably  necessary or advisable for the collection of all
Receivables (including records adequate to permit the daily identification of

   each Receivable and all Collections of and adjustments to each existing
                                 Receivable).

     A. Change in Credit and Collection Policy. The Servicer and, to the
 extent that it ceases to be the Servicer, IMO, shall not make (and shall not
  permit any  Originator  to make) any material  change in the  character of its
 business or in the Credit and  Collection  Policy,  or any change in the Credit
 and Collection Policy that would adversely affect the collectibility of the

Receivables Pool or the enforceability of any related Contract or the ability of
    the Seller or Servicer to perform its obligations under any related

                        Contract or under the Agreement.

     A. Audits. The Servicer and, to the extent that it ceases to be the
 Servicer, IMO, shall (and shall cause each Originator to) from time to time
 during regular business hours, as reasonably requested in advance (unless a
Termination Event or Unmatured Termination Event exists) by the Administrator
  permit the Administrator, or its agents or representatives: (i) to examine
    and make  copies of and  abstracts  from all books,  records  and  documents
 (including computer tapes and disks) in its possession or under its control

   relating to Receivables and the Related Security, including the related
  Contracts, and (ii) to visit its offices and properties for the purpose of
    examining  such  materials  described  in clause (i)  above,  and to discuss
 matters  relating to Receivables  and the Related  Security or its  performance
 hereunder or under the Contracts with any of its officers, employees, agents

               or contractors having knowledge of such matters.

      A. Deposits to Lock-Box Accounts. The Servicer shall: (i) instruct
   all Obligors to make payments of all Receivables to one or more Lock-Box
  Accounts or to post office boxes to which only Lock-Box Banks have access (and
    shall instruct the Lock-Box Banks to cause all items and amounts

relating to such  Receivables  received in such post office  boxes to be removed
and deposited into a Lock-Box Account on a daily basis); and (ii) deposit, or

 cause to be deposited, any Collections received by it into Lock-Box Accounts
 not later than one Business Day after receipt thereof. Each Lock-Box Account
    and the Collection Account shall at all times be subject to a Lock-Box
Agreement and a Collection Account Agreement, respectively. The Servicer will
  not deposit or  otherwise  credit,  or cause or permit to be so  deposited  or
      credited, to any Lock-Box Account cash or cash proceeds other than

                                  Collections.

      A. Reporting Requirements. IMO shall provide to the Administrator
    (in multiple copies, if requested by the Administrator) the following:

      1. As soon as available and in any event within 60 days after the
   end of each of the first three quarters of each fiscal year of IMO, (a)
      copies of the unaudited consolidated balance sheet of IMO and its
    consolidated Subsidiaries as at the end of such quarter, together with
  unaudited statements of earnings, stockholders' equity and cash flows for such
    quarter and the portion of the fiscal year through such quarter, prepared in
    accordance with GAAP and certified by the chief financial

 officer,  treasurer or chief  accounting  officer of IMO, (b) a letter from the
    chief financial officer, treasurer or chief accounting officer of IMO

 certifying to the best  knowledge of such  officer,  that neither a Termination
   Event nor an Unmatured Termination Event has occurred and is continuing;

      1. As soon as available  and in any event within 120 days after the end of
 each fiscal year of IMO, (a) a copy of the  consolidated  balance  sheet of IMO
 and its consolidated Subsidiaries as at the end of such fiscal year,

  together with the related  statements  of earnings,  stockholders'  equity and
    cash flows for such fiscal year, each prepared in accordance with GAAP

     applied  consistently   throughout  the  periods  reflected  therein  (such
    consolidated balance sheet and such related statements to be certified

   without any Impermissible Qualification by independent certified public
  accountants of nationally recognized standing), and (b) a letter from the
    chief  financial  officer,  treasurer  or chief  accounting  officer  of IMO
 certifying to the best  knowledge of such  officer,  that neither a Termination
 Event nor an Unmatured  Termination  Event has occurred and is  continuing,  in
 each case as at the end of each such fiscal year and the date of delivery of

                                 such letter;

      1. as to the Servicer only, as soon as available and in any event
 not later than 10 days after the last day of each Reporting Period a Monthly
Report as of the last day of such Reporting Period or, within 5 Business Days of
  a request by the Administrator, a Monthly Report for such periods as is

 specified by the Administrator (including on a semi-monthly, weekly or daily
                                   basis);

        1. promptly after the sending or filing thereof, copies of all
   reports that IMO sends to any of its security holders, and copies of all
reports and  registration  statements that IMO or any Subsidiary  files with the
   Securities and Exchange Commission or any national securities exchange;

       1. promptly after the filing or receiving thereof, copies of all
 reports and notices that IMO or any of its Affiliate files under ERISA with
the Internal Revenue Service, the Pension Benefit Guaranty Corporation or the
    U.S. Department of Labor or that such Person or any of its Affiliates
receives from any of the  foregoing or from any  multiemployer  plan (within the
  meaning of Section 4001(a)(3) of ERISA) to which such Person or any of its

     Affiliate  is or was,  within the  preceding  five  years,  a  contributing
 employer, in each case in respect of the assessment of withdrawal liability

     or an event or condition that could, in the aggregate, result in the
          imposition of liability on IMO and/or any such Affiliate;

     1. promptly after IMO obtains knowledge thereof, notice of any: (A)
  litigation, investigation or proceeding that may exist at any time between
  IMO or any of its Subsidiaries and any Governmental Authority that, if not
  cured could be reasonably expected to have a Material Adverse Effect; (B)
 litigation or proceeding affecting IMO or any of its Subsidiaries, or any of
 their respective properties, businesses, assets or revenues, which could be
     reasonably expected to have a Material Adverse Effect on IMO and its
   Subsidiaries as a whole; or (C) litigation or proceeding relating to any
                            Transaction Document; and

1.

        such other information respecting the Receivables or the condition or
  operations, financial or otherwise, of IMO or any of its Affiliates as the
           Administrator may from time to time reasonably request.

      A. Credit Agreement. IMO shall provide notice to the Administrator
 of a Termination Event described in paragraph (l) or (m) of Exhibit V within
5 Business Days after the occurrence of such  Termination  Event  (regardless of
  whether the circumstances or events giving rise to such Termination Events

      shall have been amended, modified or waived pursuant to the Credit
                                 Agreement).

       3. Separate Existence. Each of the Seller and IMO hereby acknowledges
 that the Purchasers, the Issuer and the Administrator are entering into the
    transactions  contemplated  by  this  Agreement  and the  other  Transaction
 Documents  in reliance  upon the Seller's  identity as a legal entity  separate
 from IMO and its Affiliates. Therefore, from and after the date hereof, each

   of the Seller and IMO shall take all steps specifically required by the
    Agreement or reasonably required by the Administrator to continue the
Seller's  identity as a separate  legal  entity and to make it apparent to third
  Persons that the Seller is an entity with assets and liabilities distinct from
  those of IMO and any other Person, and is not a division of IMO, its

    Affiliates or any other Person. Without limiting the generality of the
   foregoing and in addition to and consistent with the other covenants set
 forth                     herein,  each of the  Seller  and IMO shall take such
                           actions as shall be required in order that:

              (a) The Seller will be a limited purpose entity whose primary
        activities are restricted in its limited liability company agreement
        to: (i) purchasing or otherwise acquiring from Originators, owning,
       holding and granting  security  interests or selling  interests,  in Pool
       Assets,  (ii) entering into  agreements  for the selling and servicing of
       the Receivables Pool, and (iii) conducting such other activities as it

        deems necessary or appropriate to carry out its primary activities;

             (b) The Seller shall not engage in any business or activity, or
       incur any indebtedness or liability, other than as expressly permitted
                          by the Transaction Documents;

             (c) Not less than one member of the Seller's Board of Directors
          (the "Independent Director") shall be an individual who is not a
           direct, indirect or beneficial stockholder, officer, director,
          employee, affiliate, associate or supplier of IMO or any of its
      Affiliates. The limited liability company agreement of the Seller shall
      provide that: (i) the Seller's Board of Directors shall not approve, or
        take any other  action to cause the  filing of, a  voluntary  bankruptcy
        petition with respect to the Seller unless the Independent Director

      shall approve  the taking of such  action in writing  before the taking of
         such action, and (ii) such provision cannot be amended without the

                 prior written consent of the Independent Director;

              (d) The Independent Director shall not at any time serve as a
        trustee in bankruptcy for the Seller, IMO or any Affiliate thereof;

               (e) Any employee, consultant or agent of the Seller will be
          compensated from the Seller's funds for services provided to the
      Seller. The Seller will not engage any agents other than its attorneys,
        auditors and other professionals, and a servicer and any other agent
        contemplated by the Transaction Documents for the Receivables Pool,
      whichservicer  will be fully  compensated  for its  services by payment of
           the Servicing Fee, and a manager, which manager will be fully

                        compensated from the Seller's funds;

            (f) The Seller will contract with the Servicer to perform for the
           Seller all operations required on a daily basis to service the
        Receivables Pool. The Seller will pay the Servicer the Servicing Fee
         pursuant hereto. Except as provided in the following sentence the
                         Seller will not incur any material indirect or overhead
       expenses for items shared with IMO (or any other Affiliate  thereof) that
       are not reflected in the Servicing Fee. To the

      extent, if any, that the Seller (or any Affiliate thereof) shares items of
        expenses not reflected in the Servicing Fee or the manager's fee,

       such as legal,  auditing and other professional  services,  such expenses
      will be allocated to the extent practical on the basis of actual use or

        the value of services rendered, and otherwise on a basis reasonably
       related to the actual use or the value of services rendered; it being
      understood that IMO shall pay all expenses relating to the preparation,
         negotiation, execution and delivery of the Transaction Documents,
                   including legal, rating agency and other fees;

                 (g) Except as provided in clause (f) above, the Seller's
         operating expenses will not be paid by IMO or any other Affiliate
                                      thereof;

                (h) All of the Seller's business correspondence and other
       communications shall be conducted in the Seller's own name and on its
                              own separate stationery;

             (i) The Seller's books and records will be maintained separately
                 from those of IMO and any other Affiliate thereof;

            (j) All financial  statements  of IMO or any Affiliate  thereof that
       are consolidated to include Seller will contain detailed notes clearly

        stating that: (i) a special purpose entity exists as a Subsidiary of
         IMO, and (ii) Originators have sold receivables and other related
         assets to such special purpose Subsidiary that, in turn, has sold
      undivided interests therein to certain financial institutions and other
                                    entities;

               (k) The  Seller's  assets  will be  maintained  in a manner  that
       facilitates their identification and segregation from those of IMO or

                               any Affiliate thereof;

             (l) The Seller will strictly observe organizational  formalities in
       its dealings with IMO or any Affiliate thereof, and funds or other

        assets of the Seller will not be commingled with those of IMO or any
        Affiliate thereof except as permitted by the Agreement in connection
         with servicing the Pool Receivables. The Seller shall not maintain
        joint bank accounts or other depository accounts to which IMO or any
       Affiliate thereof (other than IMO in its capacity as the Servicer) has
       independent access. The Seller is not named, and has not entered into
         any agreement to be named, directly or indirectly, as a direct or
         contingent beneficiary or loss payee on any insurance policy with
       respect to any loss relating to the property of IMO or any Subsidiary
         or other Affiliate of IMO. The Seller will pay to the appropriate
        Affiliate the marginal increase or, in the absence of such increase, the
      market amount of its portion of the premium payable with respect to

        any insurance policy that covers the Seller and such Affiliate; and

             (m) The Seller will maintain arm's-length relationships with IMO
         (and any Affiliate thereof). Any Person that renders or otherwise
       furnishes services to the Seller will be compensated by the Seller at
      market rates for such services it renders or otherwise furnishes to the
       Seller. Neither the Seller nor IMO will be or will hold itself out to
       be responsible for the debts of the other or the decisions or actions
       respecting the daily business and affairs of the other. The Seller and
       IMO will immediately correct any known misrepresentation with respect
      to the  foregoing,  and they will not  operate or purport to operate as an
       integrated single economic unit with respect to each other or in their

                           dealing with any other entity.

            (n) IMO shall not pay the salaries of Seller's employees, if any.

                                    EXHIBIT V

                               TERMINATION EVENTS

               Each of the following shall be a "Termination Event":

     A. (i) the Seller, any Originator or the Servicer (if IMO or any of
its Affiliates) shall fail to make when due any payment or deposit to be made
 by it under the Agreement and such failure shall  continue  unremedied  for one
  Business Day or (ii) the Seller, any Originator or the Servicer (if IMO or

   any of its  Affiliates)  shall fail to perform  or  observe  any other  term,
 covenant or agreement under the Agreement or any other Transaction Document

  and such failure shall continue for 30 days after notice thereof from the
                         Issuer or the Administrator;

       A. IMO (or any Affiliate thereof) shall fail to transfer to any
  successor Servicer when required any rights pursuant to the Agreement that
                IMO (or such Affiliate) then has as Servicer;

         A. any representation or warranty made or deemed made by the
Seller, IMO, or any Originator (or any of their respective officers) under or
  in connection  with the Agreement or any other  Transaction  Document,  or any
 information  or report  delivered by the Seller,  IMO, or any Originator or the
 Servicer  pursuant to the Agreement or any other  Transaction  Document,  shall
 prove to have been incorrect or untrue in any material respect when made or

                          deemed made or delivered;

       A. the Seller or the Servicer shall fail to deliver the Monthly
  Report pursuant to the Agreement, and such failure shall remain unremedied
   for five days after notice thereof from the Issuer or the Administrator;

       A. the Agreement or any purchase or reinvestment pursuant to the
    Agreement shall for any reason: (i) cease to create, or the Purchased
 Interest  shall for any reason cease to be, a valid and  enforceable  perfected
   undivided percentage ownership or security interest to the extent of the

     Purchased  Interest  in the Pool  Receivables,  the  Related  Security  and
  Collections with respect thereto, free and clear of any Adverse Claim, or

(ii) cease to create,  or the  interest of the Issuer with  respect to such Pool
  Assets shall cease to be, a valid and enforceable first priority perfected

           security interest, free and clear of any Adverse Claim,

      A. the Seller, IMO, or any Originator shall generally not pay its
  debts as such debts become due, or shall admit in writing its inability to
 pay its debts generally, or shall make a general assignment for the benefit
of creditors; or any proceeding shall be instituted by or against the Seller,
 IMO, or any  Originator  seeking to adjudicate  it a bankrupt or insolvent,  or
  seeking liquidation, winding up, reorganization, arrangement, adjustment,

 protection,  relief or composition of it or its debts under any law relating to
 bankruptcy,  insolvency or reorganization or relief of debtors,  or seeking the
 entry of an order for relief or the appointment of a receiver, trustee,

custodian or other similar  official for it or for any  substantial  part of its
 property and, in the case of any such proceeding instituted against it (but

  not instituted by it),  either such  proceeding  shall remain  undismissed  or
    unstayed  for a period  of 60 days,  or any of the  actions  sought  in such
    proceeding (including the entry of an order for relief against, or the

 appointment of a receiver, trustee, custodian or other similar official for, it
 or for any substantial part of its property) shall occur; or the Seller, IMO or
 any Originator shall take any organizational or corporate action, as

applicable to authorize any of the actions set forth above in this paragraph;

     A. (i) the (A) Default Ratio shall exceed 3.5%, (B) the Delinquency
 Ratio shall exceed 9.0% or (C) the Dilution Ratio shall exceed 8.0% or (ii)
the average for three consecutive Reporting Periods of: (A) the Default Ratio
    shall exceed 2.5%, (B) the Delinquency Ratio shall exceed 8.0%(C) the
                        Dilution Ratio shall exceed 7.0%.

                     A. a Change in Control shall occur,

       A. at any time (i) the sum of (A) the Capital plus (B) the Total
  Reserves, exceeds (ii) the sum of (A) the Net Receivables Pool Balance at
  such time plus (B) the Issuer's Share of the amount of Collections then on
   deposit in the  Lock-Box  Accounts  and the  Collection  Account  (other than
     amounts set aside therein representing Discount and Fees), and such

      circumstance shall not have been cured within four Business Days,

       (j) (i) IMO or any of its Subsidiaries shall fail to pay any principal of
    or premium or interest on any of its Debt that is outstanding in a principal
    amount of at least $2,500,000 in the aggregate when the same

 becomes due and payable (whether by scheduled  maturity,  required  prepayment,
acceleration, demand or otherwise), and such failure shall continue after the

    applicable  grace  period,  if any,  specified in the  agreement,  mortgage,
    indenture or instrument relating to such Debt (and shall have not been

waived);  or (ii) any other event (other than a Termination  Event  described in
paragraph (l) or (m) of Exhibit V) shall occur or condition shall exist under

  any agreement, mortgage, indenture or instrument relating to any such Debt and
  shall continue after the applicable  grace period,  if any,  specified in such
  agreement, mortgage, indenture or instrument (and shall have not been waived),
  if, in either case: (a) the effect of such non-payment, event or

condition is to give the applicable debtholders the right (whether acted upon or
 not) to accelerate the maturity of such Debt, or (b) any such Debt shall

be declared to be due and  payable,  or required to be prepaid  (other than by a
regularly scheduled required prepayment), redeemed, purchased or defeased, or an
offer to repay, redeem, purchase or defease such Debt shall be required to

          be made, in each case before the stated maturity thereof;

        (k) either: (i) the Internal Revenue Service shall file a notice of
 lien asserting a claim pursuant to the Internal Revenue Code with regard to
 any of the assets of Seller, any Originator, IMO or any ERISA Affiliate, or
  (ii) the  Pension  Benefit  Guaranty  Corporation  shall file a notice of lien
 asserting a claim pursuant to ERISA with regard to any assets of the Seller,

                 any Originator, IMO or any ERISA Affiliate;

        (l) IMO shall fail to  perform  and  comply  with each of the  financial
 covenants set forth in Section 7.2.4 of the Credit Agreement as in effect on

    the date  hereof,  (regardless  of whether  such  covenants  may be amended,
      modified or waived from time to time in accordance with the Credit

Agreement),  each of which covenants and  agreements,  together with all related
  definitions, exhibits and ancillary provisions, are hereby incorporated in

    this Agreement by reference as through specifically set forth in this
   paragraph (l) and shall survive the termination and/or expiration of the
                              Credit Agreement; or

      (m) the  occurrence  of an event set forth in Section  8.1.5 of the Credit
 Agreement  as in effect on the date hereof,  (regardless  of whether such event
 may be amended, modified or waived from time to time in accordance with the

  Credit  Agreement),  each of which events and  agreements,  together  with all
      related definitions, exhibits and ancillary provisions, are hereby

incorporated in this Agreement by reference as through specifically set forth in
 this paragraph (m) and shall survive the termination and/or expiration of

                              the Credit Agreement.

                                   SCHEDULE I

                          CREDIT AND COLLECTION POLICY

                                   SCHEDULE II

                      LOCK-BOX BANKS AND LOCK-BOX ACCOUNTS

               Lock-Box Bank Lock-Box Accounts Lock-Box Number

                   Bank of America, N.A. 3751450524 502932

                   Bank of America, N.A. 3751450540 502944

                   Bank of America, N.A. 3751450537 502924

                   Bank of America, N.A. 3751450553 502959
                                                                          502910
                                                                          502919

                                  SCHEDULE III

                                   TRADE NAMES

                                      None

                                                                         ANNEX A

                                             to Receivables Purchase Agreement

                             FORM OF MONTHLY REPORT

                                                                         ANNEX B

                                             to Receivables Purchase Agreement

                             FORM OF PURCHASE NOTICE

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