Document:

Bank of America
                     Banc of America Commercial Corporation

                         Receivables Purchase Agreement
                              entered into between
                        Cluett American Receivables, LLC
                                       and

                     Banc of America Commercial Corporation

Banc of America Commercial Corporation
P.O. Box 4095
Atlanta, Georgia  30302-4095

Ladies and Gentlemen:

                  We are pleased to confirm the following agreement whereby from
time to time we may sell certain of our accounts  receivable  to you and you may
purchase such accounts  receivable from us on the terms and conditions set forth
herein.

SECTION 1.            DEFINITIONS

         1.1......"Approved  Receivable"  shall mean a Receivable  that has been
credit approved by you and is otherwise  acceptable to you, as evidenced by your
written approval, as more fully described in Section 2.1 of this Agreement.

         1.2......"Assignment"  shall mean an Assignment,  substantially  in the
form of Exhibit A hereto, evidencing our sale, transfer and assignment to you of
a Pool of Approved Receivables.

         1.3......"Banking  Day" shall mean a day for  dealings  by and  between
banks, excluding Saturday,  Sunday and any day which shall be a legal holiday in
the City of Atlanta, Georgia and any other day on which banking institutions are
authorized to close in the City of Atlanta, Georgia.

         1.4......"Cluett American" shall mean Cluett American Corp, a Delaware
corporation.

         1.5......"Collection  Turn-Over  Date"  shall  mean for  each  Approved
Receivable  purchased by you:  (i) with respect to payments  made to us or Great
American on such Approved Receivable by check, up to four (4) Banking Days after
the date such check is received by us or Great American,  as the case may be, or
(ii) with respect to payments made to us or Great American by wire transfer, one
(1) Banking Day after the date we or Great American, as the case may be, receive
such wire transfer.

         1.6......"Collections"  shall  mean,  with  respect  to  any  Purchased
Receivables,  all cash collections and all other amounts at any time received or
obtained  with respect  thereto or  attributed  or credited to payment  thereof,
including all proceeds.

         1.7......"Credit and Collection Policy" shall mean, collectively, those
credit and  collection  policies  and  practices  of Great  American and us with
respect to the Receivables as in effect on the date hereof.

         1.8......"Credit  Risk" shall mean,  with respect to any  Receivable or
portion  thereof,  the risk of loss resulting  from a Customer's  failure to pay
such Receivable as and when due because of such Customer's financial inability.

         1.9......"Customer"  shall mean,  with respect to any  Receivable,  the
Person identified on the Schedule to the related Assignment as obligated to make
payment of such Receivable.

         1.10....."Customer Dispute" shall mean, with respect to any Receivable,
any cause for  nonpayment  of such  Receivable by a Customer  obligated  thereon
other  than  the  financial  inability  of  such  Customer,  including,  without
limitation, any alleged defense, offset or counterclaim,  act of God, war, civil
strife,  currency  restriction,  change in law or governmental policy or foreign
political impediment.

         1.11....."Cutoff  Date"  shall  mean,  with  respect  to any  Purchased
Receivables, the date identified as such in the related Assignment.

         1.12....."Face Amount" shall mean, with respect to any Receivable,  the
dollar amount thereof shown on the schedule to the related Assignment.

         1.13....."Final  Settlement Date" shall mean, with respect to a Pool of
Purchased Receivables,  the Banking Day that is three (3) Banking Days after the
earlier of (i) the first Banking Day as of which you shall have received in cash
Collections  from such  Purchased  Receivables  in an aggregate  amount at least
equal  to the  sum of  (A)  the  Purchase  Price  for  such  Pool  of  Purchased
Receivables  and (B) all other  amounts  then due and payable by us to you under
this  Agreement  and (ii) the first  Banking  Day which is not less than 90 days
after the Purchase Date of such Pool of Purchased Receivables.

         1.14....."Great American" shall mean Great American Knitting Mills,
Inc., a Delaware corporation.

         1.15....."Person" shall mean an individual,  partnership,  corporation,
limited liability company, unincorporated organization,  trust or joint venture,
or a governmental agency or political subdivision thereof.

         1.16....."Pool"  shall  mean (i) one or more  Receivables  or  Approved
Receivables, as appropriate, that we propose to sell to you on a single Purchase
Date or (ii) one or more Purchased  Receivables sold to you on a single Purchase
Date and identified in the same Assignment.

         1.17....."Prime Rate" shall mean the rate of interest announced by Bank
 of America, N.A. from time to time as its Prime Rate.

         1.18....."Purchase  Date"  shall  mean,  with  respect  to any  Pool of
Approved Receivables,  the Banking Day such Pool is purchased by you pursuant to
the terms of this Agreement.

         1.19....."Purchase  Price"  shall  mean,  with  respect  to any Pool of
Purchased  Receivables  the purchase price payable by you to us for such Pool of
Purchased Receivables, calculated pursuant to Section 2.2 of this Agreement.

         1.20....."Purchased  Receivables"  shall mean any Approved  Receivables
purchased by you from us pursuant to this Agreement.

         1.21....."Receivables"  shall mean (i) accounts arising from Sales, the
proceeds  thereof,  and  all  instruments,   contract  rights,   chattel  paper,
documents,  insurance proceeds and general intangibles relating directly thereto
and  (ii) all  security  interests  or  liens  and  property  from  time to time
purporting to secure  payment of such  Receivables,  together with all financing
statements  signed  by  a  Customer  describing  any  collateral  securing  such
Receivables,  and all guarantees,  insurance and other  arrangements of whatever
character from time to time supporting or securing payment of such  Receivables,
whether now existing or hereafter created.

         1.22....."Receivables  Transfer  Agreement"  shall mean the Receivables
Transfer Agreement, dated as of May 12, 2000, between Great American and us.

         1.23....."Sales"  shall mean the sale of Gold Toe brand and other socks
by Great  American in the  ordinary  course of its  business to Customers in the
United States of America.

         All terms that are used in this  Agreement  and that are defined in the
Uniform  Commercial  Code as  currently  in effect in the State of New York (the
"New York UCC") are used herein as defined in the New York UCC.

SECTION 2.            APPROVAL AND SALE; PURCHASE PRICE; COLLECTIONS

         2.1......We  may submit to you for your  review not more than two times
and only  during  the period  from the date  hereof  through  June 30,  2000,  a
schedule  identifying a Pool of  Receivables,  which schedule shall be in a form
acceptable to you and shall include the name of the Customers  obligated on such
Receivables,   the  selling  terms  of  such  Receivables,   an  aging  of  such
Receivables,  a copy  of the  invoices  for  such  Receivables  and  such  other
information  with  respect to such  Receivables  and such  Customers  as you may
request.  Upon receipt of such information,  you will make such credit and other
investigations  as you  deem  appropriate  in  accordance  with  your  customary
business  practices.  After your  completion  of such  investigations,  you will
advise  us as to which  Receivables,  if any,  in such Pool of  Receivables  are
Approved  Receivables.  We understand that (i) you do not have any obligation to
approve any Receivable or all or any portion of a Pool of Receivables,  (ii) you
may approve  only a portion of a Pool of  Receivables,  (iii) in no event will a
Receivable 60 days or more past the due date thereof be an Approved  Receivable,
and (iv) any approval of a Receivable or a Pool of  Receivables  will be made by
you in writing and shall be subject to the terms and  conditions of such written
approval.

         2.2......Subject to the terms and conditions of this Agreement, on each
Purchase Date we will sell,  transfer and assign to you,  without recourse to us
other than as provided in this  Agreement,  and you will  purchase  from us, the
Pool of Approved  Receivables  identified on Schedule I to an Assignment that we
deliver to you on such Purchase  Date.  Upon your receipt of such  Assignment on
such  Purchase  Date,  you shall be the absolute  owner of all of the  Purchased
Receivables identified in such Assignment.  In addition, we hereby assign to you
all of our right,  title and interest (but none of our obligations),  in, to and
under the Receivables  Transfer  Agreement and the Guarantee dated as of May 12,
2000 (the  "Guarantee") made by Cluett American in our favor. The Purchase Price
of the Pool of Approved  Receivables  sold to you on a Purchase Date shall be an
amount equal to (i) the  aggregate  Face Amount of the Approved  Receivables  in
such Pool less (ii) the sum, for all such Approved Receivables,  of the product,
for each day during the period  from such  Purchase  Date to the  earlier of the
date you have  received  payment in full of the  aggregate  Face  Amount of such
Approved Receivables and the Final Settlement Date with respect to such Pool, of
(A) 95% of the Face  Amount of each  Approved  Receivable  in such Pool less any
payments  received and applied before such day against such Approved  Receivable
and (B) the  Prime  Rate  less  (iii) .5% of the  aggregate  Face  Amount of the
Approved  Receivables  in such Pool.  Any portion of the Purchase Price that has
not been advanced by you to us pursuant to Section 2.5 of this  Agreement  shall
be  payable  to us, on the  Final  Settlement  Date for such  Pool of  Purchased
Receivables,  by wire transfer of immediately  available  funds to an account of
ours that we designate to you in writing.

         2.3......Except as provided in Section 4.2 of this Agreement,  the sale
and  purchase  of  Receivables  contemplated  by this  Agreement  shall  be on a
non-notification  basis and you shall not notify any Customers without our prior
consent.  Great  American  shall,  as agent for you and us, in  accordance  with
Section  4 of  this  Agreement  and  Section  5.3  of the  Receivables  Transfer
Agreement,  receive  all  Collections  on the  Purchased  Receivables  from  the
applicable  Customers  until its  authority to do so is  terminated  pursuant to
Section  4.1  of  this  Agreement.  Prior  to  any  such  termination,  (i)  all
Collections  received  by  us  or  Great  American  with  respect  to  Purchased
Receivables  shall be held in trust  for you.  We shall  cause  all  Collections
constituting collected funds with respect to any Purchased Receivable to be wire
transferred to you on each  Collection  Turn-Over Date, and such collected funds
shall be applied by you to pay such Purchased Receivable,  with any excess to be
held  by you  and  applied  as  provided  below  in this  Section  2.3 and  (ii)
Collections  with respect to Purchased  Receivables may be commingled with other
collections of Receivables  owned by Great American pending the transfer of such
Collections  to you.  On the Final  Settlement  Date with  respect  to a Pool of
Purchased  Receivables,  you may charge our account (which charge shall, without
any further  action,  constitute  a  repurchase  by us from you of the  relevant
Purchased  Receivable pursuant to Section 3.3 of this Agreement) with the amount
of each Purchased Receivable in such Pool, that has not been paid by reason of a
Customer Dispute.  In the event that Collections  received by you on or prior to
the Final  Settlement  Date with  respect to any Pool of  Purchased  Receivables
exceed the Purchase Price of such Pool, you will apply such excess on such Final
Settlement Date to any other amounts owing by us to you on such Final Settlement
Date  (whether  on  account  of  dilutions  or  otherwise).  In the  event  that
Collections  received  by you on or  prior to the  Final  Settlement  Date  with
respect  to a  Pool  of  Purchased  Receivables  exceed,  after  application  in
accordance with the immediately preceding sentence, the aggregate of all amounts
owing by us to you hereunder on such Final  Settlement  Date,  you will pay such
excess by wire  transfer of  immediately  available  funds to an account of ours
that we designate to you in writing.

         2.4......Within  fifteen  (15) days  after the end of each  month,  you
shall render to us a statement  of our account with you showing the  accountings
for your  charges and  receipts  and other  transactions  between us during such
month  with  respect  to the  transactions  contemplated  hereby.  Your  monthly
statement  of our account  with you shall be deemed  correct and binding upon us
and shall  constitute an account  stated between us unless you receive a written
statement of our exceptions  within thirty (30) days after same is mailed to us.
We shall pay or cause to be paid to you all Collections and other amounts due to
you  hereunder on the date when due by wire  transfer of  immediately  available
funds to an account of yours that you designate to us in writing.

         2.5......Prior  to the Final  Settlement Date with respect to a Pool of
Approved  Receivables  purchased by you, upon our request you will advance to us
all or a portion of the anticipated Purchase Price payable by you to us for each
Purchased  Receivable in such Pool,  but in any event not exceeding  ninety-five
percent (95%) of the Face Amount of such Purchased  Receivable.  We shall pay to
you  interest on such  advanced  amount at the rate per annum equal to the Prime
Rate for the number of days that such  advance  remains  outstanding  until such
Final  Settlement Date and thereafter  until paid at the rate per annum equal to
the Prime  Rate plus 2%.  Such  advance  shall be  deemed  repaid on such  Final
Settlement  Date to the  extent of the then  outstanding  balance  of  Purchased
Receivables  in such Pool which are not repaid by reason of Credit Risk,  and we
shall have no  obligation  to pay you interest on any such deemed  repaid amount
from and after such  Final  Settlement  Date.  Further,  interest  paid by us as
provided  herein  shall  reduce,  dollar for dollar,  the amount of the Purchase
Price  payable by you to us on such Final  Settlement  Date.  Interest  shall be
computed on the basis of a year of three  hundred  sixty (360) days,  for actual
days elapsed.

         2.6......It is the express intent of the parties to this Agreement that
each  assignment  and  conveyance  of  Purchased  Receivables  pursuant  to this
Agreement  be construed as a true sale of such  Purchased  Receivables  by us to
you. It is,  further,  not the intention of the parties to this  Agreement  that
each such assignment and conveyance be deemed a grant of a security  interest in
the  Purchased  Receivables  by us to  you to  secure  a debt  or  other  of our
obligations.  However,  in the event that any such  assignment and conveyance of
the Purchased  Receivables  hereunder is characterized by any court of competent
jurisdiction as a loan rather than a sale, we shall be deemed  hereunder to have
granted to you, and we hereby grant to you, a perfected first priority  security
interest  in all of our right,  title and  interest  in, to and under all of the
Purchased  Receivables,  whether now or hereafter owned, existing or arising and
wherever  located and all of our right,  title and interest in, to and under the
Receivables  Transfer Agreement and the Guarantee.  You shall have, with respect
to the  property  described in this  subsection  2.6, and in addition to all the
other rights and remedies  available to you under this  Agreement and applicable
law, any additional  rights and remedies of a secured party under any applicable
enactment of the Uniform Commercial Code.

         2.7......The sales, transfers, assignments and conveyances of Purchased
Receivables  contemplated  herein do not  constitute,  and are not  intended  to
result in a  creation  or  assumption  by you of any of our  obligations  or the
obligations of any other Person in connection with the Purchased  Receivables or
any agreement or instrument relating thereto, including, without limitation, any
obligation to any Customer.

         2.8......In  connection  with the  foregoing  conveyances,  we agree to
record and file on or prior to each related  Purchase  Date, at our own expense,
UCC-1 financing statements (and thereafter  continuation statements with respect
to such  financing  statements  when  applicable)  with  respect to the Approved
Receivables to be purchased on such Purchase Date,  meeting the  requirements of
applicable state law, in such manner and in such  jurisdictions as are necessary
to perfect the purchases of such Approved  Receivables by you from us, to obtain
oral  confirmation of such filing on or prior to such related  Purchase Date and
to deliver file-stamped copies of such financing statements or other evidence of
such filings within five Banking Days after such related Purchase Date.

SECTION 3.            CREDIT RISK; REPURCHASE

         3.1......Except as hereinafter  provided,  you assume the entire Credit
Risk on all  Purchased  Receivables  assigned to you under this  Agreement as to
which the Customer has  actually  received and finally  accepted the delivery of
Gold Toe brand and other socks.  We assume the risk of  nonpayment  of Purchased
Receivables where nonpayment results from any Customer Dispute.

         3.2......Without your prior written consent, we will not vary the terms
(including,  without limitation, amount, maturity and the like) of, or grant any
adjustment,   refund  or  other   indulgence  with  respect  to,  any  Purchased
Receivable.  We will  promptly  notify you if any  Purchased  Receivable  is not
timely paid by the Customer,  if we become aware of any Customer Dispute,  or if
we  receive  any  information  of any  matter  adversely  affecting  the  value,
enforceably  or  collectibility  of any  Purchased  Receivable  or of an adverse
change in the  financial  condition  of any  Customer  obligated  on a Purchased
Receivable.  You shall use good faith efforts (but shall have no  obligation) to
cooperate  and assist us in the  adjustment  of any Customer  Dispute.  We shall
promptly  notify you, upon accepting  returns or granting  allowances  under the
terms of any Purchased Receivable.

         3.3......In  the event that you determine  that a Purchased  Receivable
(i) remains unpaid on the Final Settlement Date for such Purchased Receivable by
reason of a Customer  Dispute  or is subject to a Customer  Dispute at any other
time,  (ii) is subject to any change of terms after its  Purchase  Date  without
your prior consent,  (iii) is or becomes subject to a lien or security  interest
(other than in your  favor),  or (iv) does not comply with each  representation,
warranty and covenant  with respect to such  Purchased  Receivable  set forth in
this Agreement or the Receivables Transfer Agreement, you may charge our account
at any time and such  charge,  without any further  action,  shall  constitute a
repurchase by us from you of the relevant Purchased Receivable. In addition, you
may charge our account with the amount of each Purchased Receivable if we breach
in any  material  respect  any  representation  or  warranty  made by us in this
Agreement or if we default in the  performance of any payment or other covenant,
obligation  or  agreement  binding on us and  contained in this  Agreement.  Any
repurchase  resulting  from any such  charge  to our  account  shall be  without
recourse or warranty of any kind by you other than a warranty  that you have not
diminished the title received from us. In connection  with any such  repurchase,
we shall pay to you on demand all amounts  payable by us to you  hereunder  with
respect to the relevant Purchased Receivable or Purchased Receivables,  less any
Collections you received thereon, plus interest at a rate per annum equal to the
Prime  Rate plus 2% for the period  from the date of such  demand to the date of
reassignment.

SECTION 4.            SERVICING; NOTIFICATION

         4.1......You  hereby  appoint,  with our  consent,  Great  American  to
perform all services necessary to administer,  service and collect the Purchased
Receivables  and remit  Collections  from such  Purchased  Receivables to you as
described  in Section 2.3 of this  Agreement.  With respect to such duties Great
American  shall be acting as your agent and shall be  subject  to the  following
conditions:  (i) it shall exercise that degree of skill and care consistent with
prudent  industry  standards  with  respect  to the  administration,  servicing,
collection  and  reporting  of  Receivables  (both  Purchased   Receivables  and
non-purchased  Receivables);  (ii) it shall comply with all applicable state and
federal laws and  regulations  in connection  with our  performing  such duties;
(iii) it shall comply with the Credit and Collection  Policy in connection  with
the  administration,  servicing,  collection and reporting of Receivables  (both
Purchased Receivables and non-purchased  Receivables) , a copy of the Credit and
Collection  Policy  having been  delivered to you prior to the initial  Purchase
Date under this Agreement;  and (iv) without your consent, it shall not take any
action with respect to any  Purchased  Receivable  that could impair your rights
therein or the  enforceability,  value or collectibility  thereof. We understand
that Great  American's  authority  to perform  such  duties (A) shall  terminate
automatically  if it has  called a meeting  of  creditors  or ceased  conducting
business or upon the  institution by or against it of any  proceeding  under any
bankruptcy  or  insolvency  laws or (B) shall  terminate at your  option,  if we
breach  any  representation,  warranty  or  covenant  or  default  in any of our
obligations in this Agreement.

         4.2......You  shall  have the right to  directly  communicate  with any
Customer  obligated on a Purchased  Receivable (and, in the case of clauses (ii)
or  (iii)  below,  commence  collection   proceedings)  (i)  to  obtain  current
information   that   concerns   such   Customer's    financial   condition   and
creditworthiness  and that is not provided  promptly by us to you after request,
(ii) if any portion of such Customer's Purchased Receivables remains unpaid five
days after the applicable  Final  Settlement  Date, (iii) if we, Great American,
Cluett American or such Customer has called a meeting of its creditors or ceased
conducting  business or upon the  institution  by or against  such Person of any
proceeding  under any bankruptcy or insolvency law, or (iv) if we default in the
payment as and when due and  payable  of any  amount  payable by us to you under
this Agreement.

         4.3......You  shall have the right to bring  suit,  in your name or our
name or the  name of  Great  American,  and  generally  have  all  other  rights
respecting Purchased  Receivables which are past due solely and exclusively as a
result of any Customer's financial  inability,  including without limitation the
right to: accelerate or extend the time of payment, settle, compromise,  release
in whole or in part any amounts  owing on any  Purchased  Receivables  and issue
credits in your name or ours.  You may  endorse or sign your name or ours on any
checks or other  instruments with respect to Purchased  Receivables or the goods
covered thereby.  Any and all returned,  reclaimed or repossessed  inventory and
goods  relating to Purchased  Receivables  shall be set aside by us, marked with
your  name and  held by us in  trust  for you as  owner,  and for your  account.
Further,  we shall promptly  notify you of the receipt of all such inventory and
goods and, at your direction,  deliver the same to you or sell the same for your
account and remit the full proceeds to you.

         4.4......We  agree to make our  records,  files  and  books of  account
available   to  you  on   request,   and  to  allow  you  and  your  agents  and
representatives  to visit our premises  during normal  business hours to examine
such records, files and books of account and to make copies or extracts thereof,
and to allow you to conduct such  examinations as you deem necessary.  You shall
be  entitled  to charge our  account  the sum of $750 per day for each  examiner
involved  in such  examination  up to a maximum  amount of $5000 for any Pool of
Receivables audited by you.

         4.5......In  connection  with  the  sale and  assignment  of  Purchased
Receivables  hereunder,  we agree, at our own expense, on each Purchase Date, to
indicate or cause to be indicated  clearly and  unambiguously  in our accounting
records that such Purchased  Receivables  have been sold to you pursuant to this
Agreement as of the applicable Purchase Date.

         4.6......Notwithstanding  anything to the contrary,  Collections  which
are received  from any  Customer  who is an account  debtor both with respect to
Receivables  that  are  Purchased  Receivables  and  Receivables  that  are  not
Purchased  Receivables  and which are not  identified  to specific  Receivables,
shall first be applied to such  Purchased  Receivables  until all such Purchased
Receivables  have been paid in full and thereafter to Receivables  which are not
Purchased Receivables,  regardless of the respective dates such Receivables were
originated and regardless of any notations on payment items.

SECTION 5.            INFORMATION

         5.1......We  shall  furnish you promptly  upon request such reports and
other information relating to Customers,  Great American, Cluett American or the
Receivables as you may from time to time reasonably request.

         5.2......For  all Purchased  Receivables  which are past due solely and
exclusively as a result of the Customer's  financial inability and for which you
have the Credit Risk,  upon your request,  we shall provide you with each of the
following:  (i) a copy  of  such  Customer's  purchase  order  and/or  a  signed
confirmation  thereof;  (ii) a copy of each  outstanding  invoice and all credit
memoranda;   (iii)  a  notarized  statement  of  account;  (iv)  copies  of  all
correspondence to and from such Customer;  (v) a copy of our complete collection
file on such Customer;  (vi) all guarantees,  collateral  documents and security
agreements,  (vi) proof of delivery of goods or rendering of services, and (vii)
such other documents and information that you may request.

SECTION 6.            REPRESENTATIONS AND WARRANTIES

         6.1......On  the date of this  Agreement and on each Purchase  Date, we
represent  and warrant  that (i) we are a duly  organized  and validly  existing
limited liability  company under the laws of the State of Delaware;  (ii) we are
duly qualified to transact  business and in good standing in every  jurisdiction
where the  failure  to be so  qualified  or in good  standing  would  materially
adversely affect the  collectibility of any Receivable or our ability to perform
our obligations  hereunder;  (iii) no provision of our limited liability company
agreement  or any other  contractual  provision  which is binding on us or Great
American  or to which or any of our  property  or Great  American's  property is
subject restrict our ability to enter into or comply with our obligations  under
of this  Agreement;  (iv) this Agreement is, and each  Assignment when delivered
hereunder will be, our legal, valid and binding obligation  enforceable  against
us in  accordance  with  its  terms;  and (v)  each of the  representations  and
warranties of Great American set forth in the Receivables Transfer Agreement are
true and correct in all material respects.

         6.2......On  the date of this  Agreement and on each Purchase  Date, we
represent and warrant that each  Receivable:  (i) complies  with all  applicable
legal  requirements;   (ii)  constitutes  a  valid  and  binding   unconditional
obligation of the Customer to pay the Face Amount of such  Receivable and is not
subject to any defense, set-off or counterclaim; (iii) is based on an actual and
bona fide sale and delivery in the ordinary course of business of Gold Toe socks
that have been  delivered to and accepted by such  Customer;  (iv)  provides for
payment by such Customer in U.S. Dollars;  (v) is not past its due date; (vi) is
our exclusive property and free and clear of all security  interests,  liens, or
claims (other than any security  interest  granted  pursuant to this Agreement);
(vii) does not include  any amount as to which such  Customer  is  permitted  to
withhold  payment  until  the  occurrence  of a  specified  event  or  condition
(including but not limited to "guaranteed" or "conditional"  sales), unless such
Customer has  acknowledged in writing that such specified event or condition has
occurred  and such  amount is owing;  (viii) is not the  subject of any legal or
arbitral proceeding; (ix) is not disputed; and (x) is not subject to the Federal
Assignment for Claims Act of 1940 or any other transfer restriction.

         6.3......On  the date of this  Agreement and on each Purchase  Date, we
represent and warrant that with respect to each Receivable:  (i) the Customer is
not our  Affiliate  or in any other way related to us and (ii) any taxes or fees
relating to such Receivable are our sole responsibility.

         6.4......On  the date of this  Agreement and on each Purchase Date, our
chief executive office, principal place of business and the office where we keep
all our  books,  records  and  documents  evidencing  Receivables,  the  related
contracts and security,  if any, are located at the address specified in Exhibit
B hereto (or at such other  locations,  notified to Purchaser in accordance with
Section 7.3).

SECTION 7.            COVENANTS

         7.1......We shall maintain and implement  administrative  and operating
procedures  (including,  without  limitation,  an  ability to  recreate  records
evidencing  Receivables  in the  event  of  the  destruction  of  the  originals
thereof),  and keep and  maintain,  all  documents,  books,  records  and  other
information  reasonably  necessary  or  advisable  for  the  collection  of  all
Receivables.

         7.2......We shall, at our expense,  timely and fully perform and comply
with all  material  provisions,  covenants  and other  promises  required  to be
observed by us under the contracts related to Purchased Receivables.

         7.3......We  shall  keep our  principal  place of  business  and  chief
executive  office,   and  the  office  where  we  keep  our  records  concerning
Receivables  and all  contracts and security  related  thereto (and all original
documents relating  thereto),  at our address referred to in Section 6.3 of this
Agreement or, upon 30 days' prior written  notice to you, at such other location
in a  jurisdiction  where all action  required by Section 7.5 of this  Agreement
shall have been taken and completed.

         7.4......We  shall  comply in all  material  respects  with our  credit
policies and  procedures for each  Purchased  Receivable.  We shall not make any
material  change in our credit  policies and  procedures if such change would be
reasonably   likely  to   adversely   affect   the   enforceability,   value  or
collectibility of any Purchased Receivables.

         7.5......We   shall  execute  such  financing   statements   (including
amendments  thereto  and  continuation  statements  thereof)  as may  be  deemed
advisable  by you from time to time to  establish,  maintain  and  protect  your
ownership interest in the Purchased Receivables.

         7.6......We  shall  take  all  action  necessary  to  assure  that  our
computer-based  systems will at all times operate and  effectively  process data
including  data fields  requiring  references  to dates on and after  January 1,
2000. At your request, we shall provide to you evidence acceptable to you of our
compliance with this Section 7.6.

SECTION 8.            EFFECTIVE DATE; TERMINATION; BINDING EFFECT

                  If accepted by you, this  Agreement  shall be effective on May
12, 2000.  Either you or we may terminate  this  Agreement at any time by giving
the other written notice of termination stating a termination date not less than
sixty (60) days from the date such notice is delivered. This Agreement continues
uninterrupted   unless  terminated  as  herein  provided.   Notwithstanding  the
foregoing,  you may terminate this Agreement  immediately upon the occurrence of
any of the  following  events:  cessation  of our  business  or the calling of a
meeting of our creditors;  the  commencement  by or against us of any proceeding
under any  bankruptcy or  insolvency  law;  breach by us of any  representation,
warranty,  covenant or obligation  contained  herein; or our failure to pay when
due any obligation  owing by us to you or your  affiliates.  Any  termination of
this Agreement,  however,  shall not affect obligations incurred hereunder prior
to such  termination.  This Agreement  shall bind us, our successors and assigns
and shall inure to the benefit of you, your successors and assigns.

SECTION 9.            MISCELLANEOUS

         9.1......You retain the right at any time and from time to time to sell
participation  interests  in any  amount  of  your  interest  in  the  Purchased
Receivables  as you may deem  desirable.  You  retain  the  right at any time to
assign all or a part of your rights under this Agreement.

         9.2......This  Agreement  shall  be  governed  by,  and  construed  and
enforced in accordance with the laws of the State of New York.

         9.3......Any taxes (excluding income taxes) payable or ruled payable by
any federal or state authority in respect of this Agreement and your purchase of
Approved  Receivables shall be paid by us, together with interest and penalties,
if any.  We  shall  reimburse  you for any and all  out-of-pocket  expenses  and
internal  charges paid or incurred by you in  connection  with the  preparation,
administration, collection or enforcement (including reasonable attorney's fees)
of this  Agreement and any amendments  hereto,  including  expenses  incurred in
connection with the filing of financial statements,  continuation statements and
record searches. We shall also pay you such reasonable wire transfer and similar
fees as you charge from time to time.  We hereby agree to indemnify you from and
against  any and  all  liabilities,  obligations,  losses,  damages,  penalties,
actions,  judgments,  suits,  costs,  expenses  or  disbursements  of  any  kind
whatsoever  which may at any time be imposed on, incurred by or asserted against
you in any way relating to or arising out of this Agreement,  the Assignments or
any of the other  agreements  related  hereto or the  transactions  contemplated
hereby or any action  taken or omitted to be taken by us under or in  connection
with any of the foregoing;  provided,  however,  that we shall not be liable for
the payment of any portion of such liabilities,  obligations,  losses,  damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
solely from your gross negligence or willful misconduct as finally determined by
a court of competent  jurisdiction  or from Credit Risk.  The agreements in this
Section 9.3 shall survive the termination of this Agreement.

         9.4 No  delay  or  failure  on  your  part  in  exercising  any  right,
privilege, or option hereunder shall operate as a waiver of such or of any other
right,  privilege,  or option, and no waiver,  amendment, or modification of any
provision of this Agreement shall be valid,  unless in writing signed by you and
then only to the  extent  therein  stated.  All  rights  and  remedies  existing
hereunder or under any other  documents  are  cumulative to and not exclusive of
any  rights or  remedies  otherwise  available.  Should  any  provision  of this
Agreement be prohibited by or invalid under  applicable law, the validity of the
remaining  provisions  shall not be affected  thereby.  Any  notices,  requests,
demands or other communications given by you under this Agreement may be sent by
mail,  delivery or telecopy to our most  current  address as  reflected  in your
records.  The  headings  used  herein  are  intended  to be for  convenience  of
reference  only and shall not  define  or limit the  scope,  extent or intent or
otherwise effect the meaning of any portion hereof.

         9.5......All demands,  notices and communications hereunder shall be in
writing  delivered by hand or by facsimile and shall be deemed to have been duly
given,  in the case of notice by  facsimile,  when  telecopied  to the following
number,  or, in the case of  notice  by hand,  if  personally  delivered  at the
following  addresses or to such other addresses as may be hereafter  notified by
the respective parties hereto:

                     Banc of America Commercial Corporation

                          335 Madison Avenue, 6th Floor

                            New York, New York 10017

                            Attention: Darren Linder

                             Telecopy: 212-503-7091

                        Cluett American Receivables, LLC
                                661 Plaid Street

                         urlington, North Carolina 27215

                           Attention: Bryan P. Marsal

                             Telecopy: 425-940-6659

         9.6......This Agreement embodies our entire agreement as to the subject
matter and supersedes all prior agreements as to the subject matter.  EACH PARTY
HERETO  HEREBY  WAIVES ALL RIGHTS TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING
RELATING TO TRANSACTIONS UNDER THIS AGREEMENT.

                                         Cluett American Receivables, LLC

                                         By:
                                         Name:
                                         Title:

                                   ACCEPTANCE

     The  foregoing  Receivables  Purchase  Agreement is accepted in the City of
Atlanta, Georgia as of the 12th day of May, 2000.

                                          Banc of America Commercial Corporation

                                          By:
                                          Name:
                                          Title:

                          ACKNOWLEDGMENT AND AGREEMENT

     GREAT AMERICAN KNITTING MILLS,  INC. hereby  acknowledges the provisions of
the  foregoing  Receivables  Purchase  Agreement  and  agrees to be bound by and
perform its obligations under Sections 2.3 and 4 thereof.

                                          Great American Knitting Mills, Inc.

                                          Name:
                                          Title:

<PAGE>

                                    EXHIBIT A

                                   ASSIGNMENT

                  FOR  VALUE  RECEIVED,   in  accordance  with  the  Receivables
Purchase  Agreement  dated as of May 12,  2000  (the  "Agreement")  between  the
undersigned  and Banc of  America  Commercial  Corporation  (the  "Buyer"),  the
undersigned does hereby sell,  assign and transfer  effective as of the close of
business on May 11, 2000 to the Buyer and its  successors and assigns all right,
title and interest of the  undersigned  in, to and under each and every Approved
Receivable  (as  defined in the  Agreement)  identified  in  Schedule I attached
hereto  and in, to and under all  guarantees  thereof  and  collateral  security
therefor.

                  This  Assignment is made without  recourse to the  undersigned
except to the extent otherwise  provided in the Agreement,  but is made pursuant
to and upon all of the  representations,  warranties,  covenants and  agreements
contained in the Agreement.

                  This  Assignment  has  been  delivered  to  the  Buyer  by the
undersigned  in the State of New York and shall be governed by and  construed in
accordance with the laws of the State of New York.

                  IN WITNESS WHEREOF, the undersigned has caused this Assignment
to be executed by its duly authorized officer as of this 12th day of May, 2000.

                                    CLUETT AMERICAN RECEIVABLES, LLC

                                    By:
                                    Name:
                                    Title:

<PAGE>

                            SCHEDULE I TO ASSIGNMENT

                 Customer Name                           Invoice Numbers

                 Belk Leggett                            4292597
                                                         4293029-4293338
                                                         4295019-4295231
                                                         4301264-4301398
                                                         4304479-4304571
                                                         4310512-4310626
                                                         4316134-4316156
                                                         4316176-4316256
                                 Total                               $175,581.12

                 Boscov's                                4291724-4291757
                                                         4292499-4292507
                                                         4303902-4303943
                                                         4305371-4305402
                                                         4306708-4306775
                                                         4307760-4307793
                                                         4311323-4311351
                                   Total                             $202,411.02

                 Burlington                              4292404-4290477
                                                         4297713-4297922
                                                         4301007-4301008
                                                         4309286
                                                         4311799-4311909
                                   Total                              $32,911.80

                 Carson Pirie Scott & Co.                4290518-4290567
                                                         4294445-4294545
                                                         4298644
                                                         4299169-4299189
                                                         4300311-4300319
                                                         4305942-4305946
                                                         4307560-4307603
                                                         4314601-4314673
                                                         4318948-4319117
                                   Total                              $98,681.55

                 DHDSC                                   4287793-4287828
                                                         4295232-4295248
                                                         4295580-4295621
                                                         4304014-4304162
                                                         4304572-4304610
                                                         4304972-4305119
                                                         4306594-4306605
                                                         4307696-4307759
                                                         4307848-4307883
                                                         4310744-4310887
                                                         4311146-4311189
                                                         4316927-4317046
                                                         4317295-4317335
                                   Total                             $215,999.76

                 Famous Barr Service                     4287741-4287750
                                                         4291465-4291528
                                                         4291947-4291991
                                                         4293001-4293028
                                                         4295737-4295916
                                                         4296727-4296752
                                                         4301011-4301031
                                                         4301493-4301524
                                                         4302564-4302573
                                                         4310181-4310211
                                                         4310892-4310914
                                                         4311493-4311580
                                                         4311957-4311966
                                   Total                             $278,666.34

                 Filenes                                 4291000-4291248
                                                         4292878-4292921
                                                         4296604-4296726
                                                         4301399-4301442
                                                         4305165-4305184
                                                         4307885-4307958
                                                         4310140-4310180
                                                         4314446-4314517
                                                         4317800-4317822
                                   Total                             $246,258.58

                 Fingerhut                               4298992
                                                         4318567
                                 Total                                $37,953.60

                 Foleys                                  4287688-4287740
                                                         4292127-4292328
                                                         4296890-4296979
                                                         4299636-4299710
                                                         4301145-4301258
                                                         4306225-4306236
                                                         4306313-4306336
                                                         4307639-4307695
                                                         4307959-4307997
                                                         4310444-4310511
                                                         4312960-4313015
                                 Total                               $160,510.26

                 Herbergus                               4290216-4290329
                                                         4290477-4290516
                                                         4299610-4299635
                                                         4301566-4301602
                                                         4306861
                                 Total                                $80,963.94

                 HQ AAFES                                4287751-4287792
                                                         4287829-4287836
                                                         4292525-4292568
                                                         4292576-4292585
                                                         4294610-4294621
                                                         4297033-4297038
                                                         4298622
                                                         4300304-4300307
                                                         4302574
                                                         4302576
                                                         4305926
                                                         4306337-4306342
                                                         4306667-4306699
                                                         4306707
                                                         4306862-4306887
                                                         4307794-4307796
                                                         4307806-4307834
                                                         4310742-4310743
                                                         4311968-4311969
                                                         4312143-4312145
                                                         4314520
                                                         4314522
                                                         4315859-4315866
                                                         4318562
                                                         4318575
                                   Total                              $33,839.80

                 JC Penney                               4305936
                                                         4305960
                                                         4306000
                                                         4306017-4306018
                                                         4316071-4316104
                                                         4286760-4287279
                                                         4287334-4287687
                                                         4287837-4288544
                                                         4288573-4288590
                                                         4288744-4288900
                                                         4292480-4292497
                                                         4292616-4292868
                                                         4292873-4292876
                                                         4293526-4294442
                                                         4297233-4297699
                                                         4297924-4298039
                                                         4298672-4298985
                                                         4300321-4300980
                                                         4301009
                                                         4302028-4302475
                                                         4302636-4302663
                                                         4302675-4302676
                                                         4305403-4305618
                                                         4305647-4305921
                                                         4305959
                                                         4305961-4306127
                                                         4306904-4306907
                                                         4306911-4307070
                                                         4308115-4309106
                                                         4309267-4309273
                                                         4309289-4309329
                                                         4309345-4309346
                                                         4309348
                                                         4309429-4309448
                                                         4309456-4309967
                                                         4311912-4311925
                                                         4312044-4312138
                                                         4312142
                                                         4312146-4312251
                                                         4315146-4315641
                                                         4315672-4315853
                                                         4315983-4316047
                                                         4318576-4318872
                                                         4318904
                                                         4318906-4318908
                                                         4319147-4320086
                                                         4320123-4320217
                                   Total                           $1,284,741.40

                 Kmart                                   4299712-4300153
                                                         4302690-4303209
                                                         4303211-4303790
                                                         4310230-4310440
                                                         4312348-4312447
                                                         4312541-4312679
                                                         4312680-4312959
                                                         4313017-4314444
                                   Total                             $457,543.14

                 Kaufmanns                               4290026-4290171
                                                         4295249-4295575
                                                         4299475-4299524
                                                         4301443-4301491
                                                         4308036-4308074
                                                         4310692-4310741
                                                         4315115-4315138
                                   Total                             $299,770.60

                 Kohls                                   4291589-4291592
                                                         4308111-4308114
                                   Total                              $65,106.72

                 Macys West                              4287330-4287333
                                                         4290657-4290991
                                                         4291709-4291723
                                                         4292922-4293000
                                                         4296980-4296994
                                                         4299167
                                                         4305199-4305273
                                                         4305299-4305370
                                                         4311352-4311492
                                                         4317336-4317340
                                                         4317466-4317577
                                   Total                             $366,384.12

                 Mamaxx Group/Marshalls                  4287280
                                                         4299001
                                                         4299003
                                                         4299166
                                                         4305619-4305620
                                                         4306312
                                                         4318570
                                   Total                             $536,311.24

                 Mamaxx/TJ Maxx                          4298993-4299609
                                                         4301259-4301263
                                                         4306310-4306311
                                                         4314173-4314176
                                   Total                             $315,713.00

                 McRaes Inc.                             4299453-4299474
                                                         4306129-4306223
                                                         43147254314768
                                                         4316107-4316133
                                   Total                              $32,319.54

                 Meier & Frank                           4288546-4288554
                                                         4290173-4290210
                                                         4291760-4291783
                                                         4292350-4292361
                                                         4298625-4298641
                                                         4300260-4300299
                                                         4304449-4304478
                                                         4308075-4308082
                                                         4309107-4309111
                                                         4310212-4310228
                                                         4311781-4311794
                                                         4315099-4315114
                                                         4315139-4315144
                                                         4318873-4318891
                                                         4319118-4319135
                                   Total                             $104,806.28

                 Rich's                                  4287281-4287329
                                                         4288642-4288715
                                                         4290440-4290476
                                                         4291645-4291708
                                                         4295623-4295736
                                                         4296286-4296292
                                                         4299525-4299564
                                                         4303819-4303884
                                                         4316157-4316175
                                                         4317675-4317796
                                                         4318914-4310946
                                   Total                             $249,655.56

                 Robinsons/May                           4290399-4290438
                                                         4291249-4291318
                                                         4296293-4296390
                                                         4300154-4300259
                                                         4301092-4301144
                                                         4310628-4310691
                                                         4311190-4311322
                                                         4317941-4317991
                                 Total                               $119,917.80

                 Sterns                                  4288592-4288641
                                                         4291784-4291876
                                                         4294546-4294570
                                                         4294861-4294978
                                                         4305185-4305197
                                                         4306244-4306258
                                                         4311698-4311722
                                                         4312253-4312274
                                                         4315074-4315098
                                                         4317823-4317880
                                   Total                             $148,669.80

                 Ross Stores                             4286755-4286759
                                                         4290213
                                                         4298987-4298991
                                                         4300300-4300301
                                                         4304164-4304165
                                                         4306308-4306309
                                                         4314518-4314519
                                   Total                             $321,863.64

                 The Bon Ton Stores                      4288723-4288743
                                                         4289879-4290025
                                                         4299005-4299165
                                                         4303945-4304013
                                                         4314912-4314982
                                                         4314991-4315011
                                                         4315013-4315039
                                                         4315041-4315073
                                                         4316052
                                                         4316054-4316070
                                                         4319137-4319146
                                   Total                             $129,655.86

                 The Hecht Co.                           4291868-4291914
                                                         4292055-4292126
                                                         4292331-4292345
                                                         4296753-4296889
                                                         4298040-4298258
                                                         4298397-4299384
                                                         4299565-4299605
                                                         4300984-4300990
                                                         4307998-4308035
                                                         4308083-4308110
                                                         4314777-4314910
                                                         4318464-4318513
                                   Total                             $344,301.18

                                    EXHIBIT B

             Chief Executive Office, Principal Place of Business and
            Location of Books and Records with Respect to Receivables

                                661 Plaid Street
                        Burlington, North Carolina 27215

<PAGE>PARTIAL RELEASE AGREEMENT

     PARTIAL RELEASE  AGREEMENT,  dated as of May 12, 2000, by and among Bank of
America, N.A. f/k/a Nationsbank, N.A., as agent for the Lenders under the Credit
Agreement  referred to below (in such  capacity,  the "Agent"),  Great  American
Knitting  Mills,  Inc., a Delaware  corporation  ("Great  American")  and Cluett
American Corp., a Delaware corporation (the "Borrower").

                             W I T N E S S E T H :

     WHEREAS,  the Borrower,  Cluett American  Investment Corp., Cluett American
Group, Inc., the Subsidiary Guarantors party thereto (including Great American),
the Lenders party thereto, the Agent and Gleacher Natwest Inc., as documentation
agent, are parties to a Credit  Agreement,  dated as of May 18, 1998 (as amended
through the date hereof, the "Credit Agreement"),  pursuant to which the Lenders
agreed to extend credit to the Borrower;

                  WHEREAS,  the obligations of the Borrower to the Agent and the
Lenders under the Credit  Agreement are guaranteed by the Subsidiary  Guarantors
(including  Great American)  pursuant to the Credit Agreement and are secured by
the Collateral (as defined in the Credit Agreement);

                  WHEREAS,  the  Borrower,  Great  American and the other Credit
Parties (as defined in the Credit  Agreement)  have requested that the Agent and
the Lenders release any and all security  interests in the Collateral  described
on Schedule I attached hereto (the "Released Collateral") in connection with the
Receivables  Transfer  Agreement,  dated as of the date  hereof,  between  Great
American and Cluett  American  Receivables,  LLC, a Delaware  limited  liability
company and a wholly-owned subsidiary of Great American;

                  WHEREAS,  the Agent and the  Lenders  are  willing  to release
their security interests in the Released Collateral, on the terms and conditions
set forth herein;

                  NOW,   THEREFORE,   in   consideration  of  the  premises  and
agreements  herein,  the Borrower,  Great American and the Agent hereby agree as
follows:

                  1. All terms used herein that are defined in the Credit
Agreement and not otherwise  defined  herein are used herein as defined therein.

                  2. Without recourse and without any representation or warranty
of any kind except as expressly provided herein, (a) the Agent hereby terminates
and  releases  any and  all  liens,  security  interests  or  other  charges  or
encumbrances  in favor of the  Agent,  for the  benefit of the  Lenders,  or the
Lenders in the Released  Collateral which secures the Credit Party  Obligations,
and (b) the Borrower and Great American hereby release the Agent and the Lenders
from any duty,  liability or obligation (if any) under the Credit  Agreement and
any other Credit Document with respect to the Released Collateral.

                  3.  Concurrently  with its execution and delivery hereof,  the
Agent will execute and deliver to Great American the UCC-3 Financing  Statements
described  in Schedule II hereto and  releasing  its  security  interests in the
Released  Collateral  perfected by the filing of the UCC-1 Financing  Statements
described in such  Schedule  II. In addition,  at the request and the expense of
Great  American,  the Agent will promptly  execute and deliver to Great American
such additional  instruments and other writings,  and take such other action, as
Great American may  reasonably  request to effect or evidence the release of the
security interest of the Agent or the Lenders in the Released Collateral.

                  4.  The  Borrower  hereby  agrees  (i) to pay  all  costs  and
expenses in connection with the  preparation,  execution,  delivery,  filing and
recording  of this  Agreement,  the release  documents  executed in  furtherance
hereof,  and the  performance  of any other acts and the  execution of any other
documents  required  to effect the  release  of any  security  pursuant  hereto,
including,  without  limitation,  the fees and  disbursements  of counsel to the
Agent and the Lenders;  and (ii) to pay any and all stamp and other  transfer or
filing taxes and fees payable or determined to be payable in connection with the
execution and delivery hereof or any release document  pursuant  hereto,  and to
hold the Agent and the Lenders harmless from and against any and all liabilities
with  respect to or  resulting  from any delay in paying or omission to pay such
taxes or fees.

                  5. Except as otherwise expressly provided herein, the Borrower
and Great  American  confirm  and agree that (i) to the  extent  that any Credit
Document  purports  to assign or pledge to the  Agent,  for the  benefit  of the
Lenders,  or to grant to the Agent,  for the benefit of the Lenders,  a security
interest  in or lien  on,  any  collateral  as  security  for the  Credit  Party
Obligations  of the Credit  Parties from time to time existing in respect of the
Credit Documents, such pledge, assignment and/or grant of a security interest or
lien is hereby ratified and confirmed in all respects as security for all Credit
Party  Obligations,  whether now existing or hereafter  arising.  This Agreement
does not and shall not affect any of the Credit Party  Obligations of any Credit
Party under or arising from the Credit  Agreement or any other Credit  Document,
including,  without limitation,  the Borrower's obligation to repay the Loans in
accordance with the terms thereof and the Credit Agreement,  or the Credit Party
Obligations  of any other Credit  Party under any Credit  Document to which such
Person is a party,  all of which Credit Party  Obligations  shall remain in full
force and effect.  Except as expressly provided herein, the execution,  delivery
and  effectiveness of this Agreement shall not operate as a waiver of any right,
power or remedy of the Agent and the Lenders  under the Credit  Agreement or any
other Credit  Document,  nor  constitute a waiver of any provision of the Credit
Agreement or any other Credit Document.

                  6. The Agent  represents  and warrants that (i) to the best of
the Agent's knowledge,  but without conducting any searches in any filing office
of any  jurisdiction,  Schedule II hereto  accurately  lists all UCC-1 Financing
Statements on file in any filing office and having Great  American as debtor and
the Agent or any Lender as secured  party that have been filed  pursuant  to the
Credit  Documents and cover any Released  Collateral  and (ii) the Agent has all
requisite  authority pursuant to the Credit Documents  (including the consent of
the requisite  Lenders) to enter into this Agreement and to release the Released
Collateral hereunder.

                  7. This  Agreement  shall (i) be  binding  on the  Agent,  the
Lenders,  the Borrower and Great  American and their  respective  successors and
assigns,  and (ii) inure to the benefit of the Agent, the Lenders,  the Borrower
and Great American and their respective successors and assigns.

                  8.  This   Agreement   may  be   executed  in  any  number  of
counterparts and by the different parties hereto in separate counterparts,  each
of which  shall be deemed to be an  original,  but all of which  taken  together
shall constitute one and the same agreement.

                  9.       This Agreement shall be governed by and construed in
accordance with the law of the State of New York.

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

                                             GREAT AMERICAN KNITTING MILLS, INC.

                                              By:
                                              Name:
                                              Title:

                                              CLUETT AMERICAN CORP.

                                              By:
                                              Name:
                                              Title:

                                              BANK OF AMERICA, N.A., as Agent

                                              By:
                                              Name:
                                              Title:

<PAGE>

                                   SCHEDULE I

Released Collateral

                  All of Great American's right,  title, and interest in, to and
under all of the following,  whether now or hereafter owned, existing or arising
and wherever located:

                  (i) all Initial Receivables and Subsequent Receivables and all
payment and enforcement  rights (but none of the obligations of any Person) with
respect to such Initial Receivables and Subsequent Receivables,

                  (ii) all Related Security with respect to such Initial
Receivables and Subsequent Receivables,

                  (iii)all Collections, and

                  (iv)  any  and  all  proceeds  (including  without  limitation
"proceeds"  as defined in Section  9-306 of the UCC as in effect in the State of
New York), of and any and all amounts  received or receivable  under, any or all
of the foregoing.

                  Great   American   and  the  LLC   intend   the   transactions
contemplated by the Receivables  Transfer Agreement to constitute sales by Great
American to the LLC of the Receivables and the other items described above.

                  As used  herein,  the  following  terms have the  meanings set
forth below (such meanings to be equally applicable to both the singular and the
plural forms of the terms defined):

                  "Assignment"  means one or more  assignments of Receivables in
the form of Exhibit A to the Receivables Transfer Agreement.

                  "Collections"   means  (i)  all  payments,   collections   and
recoveries  received  or paid by or on behalf of the LLC,  the  Originator,  the
Servicer,  any  Obligor  or  any  other  Person  with  respect  to  the  Initial
Receivables  and Subsequent  Receivables  and all Related  Security with respect
thereto and (ii) all payments  made by the  Originator,  the Servicer or the LLC
under the Receivables Transfer Agreement and the Receivables Purchase Agreement.

                  "First Purchase Date" means May 12, 2000.

                  "Great American" means Great American Knitting Mills, Inc., a
 Delaware corporation.

                  "Initial  Receivables" means the Receivables  purchased by the
LLC from Great  American on the First Purchase Date and identified on Schedule I
to an Assignment  delivered by Great  American to the LLC on the First  Purchase
Date.

                  "LLC" means Cluett American Receivables, LLC.

                  "Obligor"  means  the  Person  or  Persons  obligated  to make
payments on a Receivable,  including  without  limitation  any guarantor of such
obligations.

                  "Originator" means Great American.

                  "Person" means any association,  partnership,  business trust,
company, corporation,  limited liability company, estate, joint venture, natural
person, trust or other entity.

                  "Receivables"  means  amounts due to Great  American,  whether
constituting  an account,  chattel  paper,  instrument,  or general  intangible,
arising in connection with the sale of socks.

                  "Receivables   Purchase   Agreement"   means  the  Receivables
Purchase  Agreement between the LLC, as seller,  and Banc of America  Commercial
Corporation,  as purchaser, as the same may be amended,  amended and restated or
otherwise modified from time to time.

                  "Receivables   Transfer   Agreement"   means  the  Receivables
Transfer Agreement between Great American,  as originator,  seller and servicer,
and the LLC, as purchaser,  as the same may be amended,  amended and restated or
otherwise modified from time to time.

                  "Related Security" means, with respect to each Receivable, (i)
all security  interests or liens and property  from time to time  purporting  to
secure payment of such Receivable, together with all financing statements signed
by an Obligor describing any collateral  securing such Receivable,  and (ii) all
guarantees,  insurance and other arrangements of whatever character from time to
time supporting or securing payment of such Receivable.

                  "Second  Purchase  Date" means the date on which the LLC shall
make a second purchase of Receivables under the Receivables  Transfer Agreement,
such date being mutually agreed between Great American and the LLC.

                  "Secured Party" means the LLC.

                  "Servicer" means Great American.

                  "Subsequent  Receivables"  means the Receivables  purchased by
the LLC from  Great  American  on the Second  Purchase  Date and  identified  on
Schedule I to an Assignment delivered by Great American to the LLC on the Second
Purchase Date.

                  "UCC"  mean the  Uniform  Commercial  Code as in effect in the
applicable jurisdiction.

<PAGE>

                                   SCHEDULE II

UCC-1 Financing Statements

<TABLE>
<S>                                 <C>                                          <C>                   <C>
Debtor                              Filing Office                                File Number            Date
----------------------------------- -------------------------------------------- ---------------------- --------------

Great  American   Knitting  Mills,  Secretary of State - North Carolina          0199830226             05/29/98
Inc.                                                                             0199830227             05/29/98
                                                                                 0199830246             05/29/98
                                                                                 0199830894             06/01/98

                                    Alamance County, North Carolina              98-1068                05/29/98
                                                                                 98-1077                06/01/98

                                    Catawba County, North Carolina               981422                 05/29/98
                                                                                 981425                 06/01/98

                                    Guilford County, North Carolina              475370                 06/01/98

                                    Halifax County, North Carolina               98-536                 06/01/98

                                    Orange County, North Carolina                98-628                 06/01/98

                                    Department of State - New York               115552                 06/01/98

                                    New York County, New York                    98PN34323              07/02/98

                                    Secretary of State - Pennsylvania            28981753               05/29/98
                                                                                 28991765               06/01/98

                                    Berks County, Pennsylvania                   98-1361ST              05/29/98
                                                                                 98-1407ST              06/03/98

                                    Montgomery County, Pennsylvania              275182                 06/01/98

</TABLE>

<PAGE>

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