Document:

Exhibit 10.3

                                                                    Page 1 of 10

                                January 30, 2003

Decorize, Inc.
1938 East Phelps
Springfield, Missouri 65802

                               FACTORING AGREEMENT

Ladies and Gentlemen:

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

         1. SALE OF ACCOUNTS

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

         2. CREDIT APPROVAL

         2.1 Requests for credit approval for all of your orders must be
submitted to our Credit Department via computer by either: (a) On-Line Terminal
Access, or (b) Electronic Batch Transmission. If you are unable to submit orders
via computer, then orders can be submitted over the phone, by fax or in writing.
All credit decisions by our Credit Department (including approvals, declines and
holds) will be sent to you daily by a Credit Decisions Report, which constitutes
the official record of our credit decisions. Credit approvals will be effective
only if shipment is made or services are rendered within thirty (30) days from
the completion date specified in our credit approval. Credit approval of any
Account may be withdrawn by us any time before delivery is made or services are
rendered.

         2.2 We assume the Credit Risk on each Account approved in the Credit
Decision Report. "Credit Risk" means the customer's failure to pay the Account
in full when due on its longest maturity solely because of its financial
inability to pay. If there is any change in the amount, terms, shipping date or
delivery date for any shipment of goods or rendition of services (other than
accepting returns and granting allowances as provided in section 8 below), you
must submit a change of terms request to us, and, if such pertains to a Factor
Risk Account, then we shall advise you of our decision either to retain the
Credit Risk or to withdraw the credit approval. Accounts on which we bear the
Credit Risk are referred to collectively as "Factor Risk Accounts", and
individually as a "Factor Risk Account". Accounts on which you bear some or all
of the risk as to credit are referred to collectively as "Client Risk Accounts",
and individually as a "Client Risk Account".

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Factoring Agreement                                                 Page 2 of 10

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

         3. INVOICING

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

         4. REPRESENTATIONS AND WARRANTIES

         4.1 You represent and warrant that: each Account is based upon a bona
fide sale and delivery of inventory or rendition of services made by you in the
ordinary course of business; the inventory being sold and the Accounts created
are your exclusive property and are not, and will not be, subject to any lien,
consignment arrangement, encumbrance or security interest other than in our
favor; all amounts are due in United States Dollars; all original invoices bear
notice of the sale and assignment to us; any taxes or fees relating to your
Accounts or inventory are solely your responsibility; and none of the Accounts
factored with us hereunder represent sales to any subsidiary, affiliate or
parent company. You also warrant and represent that: your customers have
accepted the goods or services and owe and are obligated to pay the full amounts
stated in the invoices according to their terms, without dispute, claim, offset,
defense, deduction, rejection, recoupment, counterclaim or contra account, other
than as to returns and allowances as provided in section 8 below (the foregoing
being referred to in this Agreement as "Customer Claims").

         4.2 You further represent and warrant that: your legal name is exactly
as set forth on the signature page of this Agreement, you are a duly organized
and validly existing business organization incorporated or registered in the
state of Delaware, and are qualified to do business in all states where
required; the most recent financial statements provided by you to us accurately
reflect your financial condition as of that date and there has been no material
adverse change in your financial condition since the date of those financial
statements. You agree to furnish us with such information concerning your
business affairs and financial condition as we may reasonably request from time
to time. You will furnish to us: (a) as soon as possible, but not later than
ninety (90) days after the close of each of your fiscal years, your and your
consolidated subsidiaries financial statements as of the end of such year, on a
consolidated and consolidating basis, audited by a firm of independent,
certified public accountants, selected by you and acceptable to us; (b) as soon
as possible, but not later than thirty (30) days after the end of each month
hereafter, your unaudited interim financial statements as of the end of such
period and of the portion of your fiscal year then elapsed, certified by your
principal financial officer, prepared in accordance with generally accepted
accounting principles consistently applied (as in effect from time to time and
for the period as to which such accounting principles are to apply)("GAAP"), and
fairly presenting the financial position and results of your operations for such
period; (c) not later than sixty (60) days prior to the end of each of your
fiscal years, your forecasted profit and loss statements, statements of sources
and uses of cash and inventory position reports, all for the forthcoming year,
month by month, and all prepared on a consistent basis with your historical
financial statements and/or in a form and substance satisfactory to us, as the
case may be, together with appropriate supporting details and a statement of
underlying assumptions; and (d) any other reports or information reasonably
required by us, including, without limitation, such reports or information
bearing upon or related to the Accounts or the Inventory. By the thirtieth
(30th) day of each month, you shall submit to us a covenant

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Factoring Agreement                                                 Page 3 of 10

         compliance certificate (in a form acceptable to us) certified by your
principal financial officer or chief executive officer stating that you and the
Companies are in compliance with all of the warranties, representations and
covenants herein, unless otherwise stated, and that the representations in such
certificate are true and accurate to best of his or her knowledge.

         4.3 You shall not declare or pay any dividend or distributions of any
kind on, or purchase, acquire, redeem or retire, any of the capital stock or
equity interest, of any class whatsoever, whether now or hereafter outstanding,
provided that, absent the occurrence of a default or Event of Default, if you
have elected to be taxed as an "S" Corporation, under Subchapter S (Section
1362(a)) of the Internal Revenue Code of 1986, as amended (herein the "IRC"),
you may pay cash dividends to your shareholders in an aggregate amount equal to
such shareholder's actual federal and state income tax liability for any
applicable taxable year (or applicable portion thereof) attributable to your
taxable income, for each taxable year (or portion thereof) that you have an
effective election for federal income tax purposes to be treated as an "S"
corporation, provided further that (y) as a condition precedent to any such
payment, you shall (i) deliver to us a letter, in form and substance
satisfactory to CIT, from your independent public accounts detailing the amount
necessary to be applied to such shareholder's tax liability, which letter can
relate to the estimated tax payments for the next succeeding four quarters, and
(ii) such payment or distribution shall be limited to the amount(s) specified in
said letter; and (z) after any redetermination of your taxable income for such
period, each of your shareholders shall be obligated to repay to you the
aggregate amount (if any) by which any such distribution exceeded the allocable
amount of such shareholder's actual tax liability.

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

         4.5 You agree that the consolidated Tangible Net Worth (hereinafter
defined) of you and the Companies (hereinafter defined) at the end of each month
during each of the periods set forth below, shall not at any time be less than
the amounts set forth next to such periods: Period Minimum Tangible Net Worth
Prior to June 30, 2003 $1, 700, 000 On and After June 30, 2003 $2, 000, 000

"Tangible Net Worth" shall mean, as of any date, the sum of (a) net worth of you
and the Companies as of any date, plus (b) indebtedness owing to your officers
or affiliates subordinated (in a form acceptable to us) in payment to the
Obligations, and minus (c) all of your intangible assets as determined in
accordance with GAAP,

         4.6 For your fiscal year ending June 30, 2003, your consolidated
financial statements shall show consolidated net loss (determined in accordance
with GAAP) of not greater than $150, 000 and for each fiscal year ending
thereafter your net income (determined in accordance with GAAP) shall exceed $1
for each such year.

         4.7 On the last day of each month, you shall submit to us a covenant
compliance certificate (in a form acceptable to us) certified by your principal
financial officer or chief executive officer stating that you and the Companies
are in compliance with all of the warranties, representations and covenants
herein, unless otherwise stated, and that the representations in such
certificate are true and accurate to best of his or her knowledge.

         5. PURCHASE OF ACCOUNTS

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Factoring Agreement                                                 Page 4 of 10

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

         6. ADVANCES

         At your request, and in our sole discretion, we may advance funds to
you of up to 90% of your Factor Risk Accounts, prior to the collection of the
Accounts. We have the right, at any time and from time to time, to hold any
reserves we deem reasonably necessary as security for the payment and
performance of any and all of your Obligations (defined in section 12 below).
All amounts you owe us, including all advances to you and any debit balance in
your Client Position Account (defined in section 10 below), and any Obligations,
are payable on demand and may be charged to your account at any time.

         7. PAYMENT OF ACCOUNTS

         7.1 All payments received by us on the Accounts will be promptly
applied to your account with us after crediting your customer's account. In
exchange for such application, we shall charge your account monthly with the
cost of two (2) additional business days on all such payments at the rate
charged by us in section 14.1 below on debit balances. No checks, drafts or
other instruments received by us will constitute final payment of an Account
unless and until such items have actually been collected.

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

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

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

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

         8. CUSTOMER CLAIMS AND CHARGE BACKS

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

         8.2 We may at any time charge back to your account the amount of: (a)
any Factor Risk Account which is not paid in full when due for any reason other
than Credit Risk; (b) any Factor Risk Account which is not paid in full when due
because of an act of God, civil strife, or war; (c) anticipation (interest)
deducted by a customer on any Account; (d) Customer Claims; (e) any Client Risk
Account

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Factoring Agreement                                                 Page 5 of 10

         which is not paid in full when due; and (f) any Account for which there
is a breach of any representation or warranty. We shall not bear the Credit Risk
on any Account charged back to you. A charge back does not constitute a
reassignment of an Account. We shall immediately charge any deduction taken by a
customer to your account,

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

         9. HANDLING AND COLLECTING ACCOUNTS; RETURNED GOODS

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

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

         10. STATEMENT OF ACCOUNT

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

         11. GRANT OF SECURITY INTEREST

         11.1 You hereby assign and grant to us a continuing security interest
in all of your right, title and interest in and to all of your now existing and
future (herein collectively the "Collateral"): (a) accounts (including the
Accounts), instruments, documents, chattel paper (including electronic chattel
paper), general intangibles (including all payment intangibles and all other
rights to payment), and any other obligations owing to you; (b) unpaid seller's
rights (including rescission, repossession, replevin, reclamation and stoppage
in transit); (c) rights to any inventory represented by the foregoing, including
Returned Goods; (d) reserves and credit balances arising hereunder; (e)
guarantees, collateral,

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Factoring Agreement                                                 Page 6 of 10

         supporting obligations and letter of credit rights with respect to the
foregoing; (f) insurance policies, proceeds or rights relating to the foregoing;
(g) federal, state and local income tax refunds; (h) cash and non-cash proceeds
of the foregoing; and (i) Books and Records (defined in section 13 below)
evidencing or pertaining to the foregoing; and (j) all now existing and future
patents and trademarks, including those registered in the United States Patent
and Trademark Office, the goodwill of the business in connection therewith, and
any and all proceeds, royalties and other fees which are or may become due
therefrom or for the use thereof.

         11.2 You agree to comply with all applicable laws to perfect our
security interest in collateral pledged to us hereunder, and to execute such
documents as we may require to effectuate the foregoing and to implement this
Agreement. You irrevocably authorize us to file financing statements, and all
amendments and continuations with respect thereto, all in order to create,
perfect or maintain our security interest in the Collateral, and you hereby
ratify and confirm any and all financing statements, amendments and
continuations with respect thereto heretofore and hereafter filed by us pursuant
to the foregoing authorization.

         12. OBLIGATIONS SECURED

         The security interest granted hereunder and any lien or security
interest that we now or hereafter have in any of your other assets, collateral
or property, secure the payment and performance of all of the now existing and
future indebtedness and obligations to us owed by you and your affiliates,
including without limitation, Faith Walk Designs, Inc. and Guildmaster
(collectively, the "Companies"), Inc., whether absolute or contingent, whether
arising under this Agreement or any other agreement or arrangement between us,
by operation of law or otherwise (collectively, "Obligations"). Obligations also
includes ledger debt (which means indebtedness for goods and services purchased
by the Companies from any party whose accounts receivable are factored or
financed by us), and indebtedness arising under any guaranty, credit enhancement
or other credit support granted by you in our favor. Any reserves or balances to
your credit and any other assets, collateral or property of yours in our
possession constitutes security for any and all Obligations.

         13. BOOKS AND RECORDS AND EXAMINATIONS

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

         13.2 Upon our reasonable request, you agree to make your Books and
Records available to us for examination and to permit us to make copies or
extracts thereof. Also, you agree to permit us to visit your premises during
your business hours and to conduct such examinations as we deem reasonably
necessary. To cover our costs and expenses of any such examinations, as of the
date of this Agreement, we will charge examination fees of $750 per field
examiner per day, or part thereof, during which such examination is conducted,
plus any out-of-pocket costs and expenses incurred by us, as provided in the
Guide (see section 18.2 below).

         14. INTEREST

         14.1 Interest is charged as of the last day of each month based on the
daily debit balances in your Funds In Use account for that month, at a rate
equal to the greater of: (a) the JPMorgan Rate (defined below), or (b) 2% per
annum (which ever is in effect, the "Applicable Rate") per annum; however, if an
Event of Default (hereinafter defined) has occurred the applicable rate of
interest shall be the Applicable Rate plus three percent (3%). The JPMorgan Rate
is the per annum rate of interest publicly announced by JPMorgan Chase Bank (or
its successor) in New York, New York from time to time as its prime rate, and is
not intended to be the lowest rate of interest charged by JPMorgan Chase Bank to
its borrowers. Any change in the rate of interest hereunder due to a change in
the JPMorgan

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Factoring Agreement                                                 Page 7 of 10

         Rate will take effect as of the first of the month following such
change in the JPMorgan Rate. Interest will be credited as of the last day of
each month based on the daily credit balances in your Funds In Use account for
that month, at a rate 4% per annum below the JPMorgan Rate being used to
calculate interest for the period. After the occurrence of an Event of Default
(as defined in section 17.1 below) and for so long as such Event of Default
continues, all of the Obligations shall, at our option, bear interest at a rate
per annum equal to the JPMorgan Rate plus three percent (3%). All interest is
calculated on a 360 day year.

         14.2 If you, as a client of ours, purchase goods or services from
another client of ours and your payments on these invoices are not timely
received, a late interest payment, at our then late interest rate, will be
charged to your account with us and shall be deemed an Obligation under this
Agreement.

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

         15. FACTORING FEES AND OTHER CHARGES

         15.1 For our services hereunder, you will pay us a factoring fee or
charge of 0.65% of the gross face amount of all Accounts factored with us,
except Accounts owed by Home Depot, Inc., which Accounts you will pay us a
factoring fee or charge of 0.25% of the gross face amount of each Account. In
addition, you will pay a fee of one-quarter of one percent (1/4 of 1%) of the
gross face amount of each Account for each thirty (30) day period or part
thereof by which the longest terms of sale applicable to such Account exceed
sixty (60) days (whether as originally stated or as a result of a change of
terms requested by you or the customer). For Accounts arising from sales to
customers located outside the fifty states of the United States of America, you
will pay us an additional factoring fee of 1% of the gross face amount of all
such Accounts. All factoring fees or charges are due and charged to your account
upon our purchase of the underlying Account.

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

         15.3 Any tax or fee of any governmental authority imposed on or arising
from any transactions between us, any sales made by you, or any inventory
relating to such sales is your sole responsibility (other than income and
franchise taxes imposed on us which are not related to any specific transaction
between us). If we are required to withhold or pay any such tax or fee, or any
interest or penalties thereon, you hereby indemnify and hold us harmless
therefor and we shall charge your account with the full amount thereof.

         16. TERMINATION

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Factoring Agreement                                                 Page 8 of 10

         16.1 You may terminate this Agreement only as of an Anniversary Date
and then only by giving us at least sixty (60) days prior written notice of
termination. "Anniversary Date" means the last day of the month occurring one
year from the date hereof, and the same date in each year thereafter. Except as
otherwise provided, we may terminate this Agreement at any time by giving you at
least sixty (60) days prior written notice of termination. However, we may
terminate this Agreement immediately, without prior notice to you, upon the
occurrence of an Event of Default (defined in section 17.1 below).

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

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

         16.4 At our option, we shall be entitled to extend this Agreement for
one (1) year if the aggregate amount of Factor Risk Accounts paid by us to you
under section 7.2 of this Agreement during any Contract Year, net of recoveries
thereon, exceeds twenty percent (20%) of the aggregate factoring fees and
charges charged to your account during such Contract Year. "Contract Year" means
the twelve-month period ending on the Anniversary Date and each Anniversary Date
thereafter. We agree to give you notice of any such extension, and
notwithstanding anything contained in section 16.1 above to the contrary, the
then next occurring Anniversary Date will be extended for an additional one (1)
year period. Any failure to give you notice of such extension will not
constitute a breach of this Agreement and will not impair our ability to extend
this Agreement to the next Anniversary Date.

         17. EVENTS OF DEFAULT AND REMEDIES UPON DEFAULT

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

         17.2 After the occurrence of an Event of Default which is not waived by
us, we may terminate this Agreement without notice to you. We shall then have
immediate access to, and may remove from any premises where same may be located,
any and all Books and Records as may pertain to the Accounts, Returned Goods and
any other collateral hereunder. Furthermore, as may be necessary to administer
and enforce our rights in the Accounts, Returned Goods and any other collateral
hereunder, or to facilitate the collection or realization thereof, we have your
permission to: (a) use (at your expense) your personnel, supplies, equipment,
computers and space, at your place of business or elsewhere; and (b) notify
postal authorities to change the address for delivery of your mail to such
address as we may designate and to receive and open your mail. We agree to turn
over to you or your representative all mail not related to the aforesaid
purposes.

         17.3 After the occurrence of an Event of Default which is not waived by
us, with respect to any other property or collateral in which we have a security
interest, we shall have all of the rights and remedies of a secured party under
Article 9 of the Uniform Commercial Code. If notice of intended disposition of
any such property or collateral is required by law, it is agreed that five (5)
days notice constitutes reasonable notice. The net cash proceeds resulting from
the exercise of any of the foregoing rights, after deducting all charges, costs
and expenses (including reasonable attorneys' fees) will be applied by us to the
payment or satisfaction of the Obligations, whether due or to become due, in

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Factoring Agreement                                                 Page 9 of 10

<PAGE>

         such order as we may elect. You remain liable to us for any
deficiencies. With respect to Factor Risk Accounts and Returned Goods relating
thereto, you hereby confirm that we are the owners thereof, and that our rights
of ownership permit us to deal with this property as owner and you confirm that
you have no interest therein.

         18. MISCELLANEOUS PROVISIONS

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

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

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

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

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

                [Remainder of this page intentionally left blank]

<PAGE>

Factoring Agreement                                                Page 10 of 10

         19. JURY TRIAL WAIVER

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

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

                                         Very truly yours,

                                         THE CIT GROUP/COMMERCIAL SERVICES, INC.

                                         By:  /s/ Robert F. Cowherd
                                            ------------------------------------
                                            Name: Robert F. Cowherd
                                            Title:Vice President
Read and Agreed to:

DECORIZE, INC.

By: /s/ Alex Budzinsky
   ---------------------------------
    Name: Alex Budzinsky
    Title:Executive Vice President

                                         Accepted at Charlotte, North Carolina

                                         THE CIT GROUP/COMMERCIAL SERVICES, INC.

                                         By: /s/ T. D. Oelschlaeger
                                            ------------------------------------
                                            Name: T. D. Oelschlaeger
                                            Title: Senior Vice PresidentEmployment Agreement with Joseph P. Schiesl

 
Exhibit 10.20

 
EMPLOYMENT AGREEMENT 
 
EMPLOYMENT AGREEMENT (this “Employment
Agreement”) dated as of February 14, 2003 (“Effective Date”), between UNIVERSAL HOSPITAL SERVICES, INC., a Delaware corporation (the “Company”), and Joseph P. Schiesl (the
“Executive”). 
 
The Company wishes to employ the
Executive, and the Executive wishes to accept employment with the Company, on the terms and conditions set forth in this Agreement. 
 
Accordingly, the Company and the Executive agree as follows: 
 
Position; Duties. The Company agrees to employ the Executive, and the Executive agrees to serve and accept employment, for the Term (as defined below) as
Senior Vice President, Outsourcing Services of the Company, subject to the direction and control of the Chief Executive Officer and the Board of Directors of the Company (the “Board”), and, in connection therewith, to reside in the
Minneapolis, Minnesota area, to oversee and direct the operations of the outsourcing services of the Company and to perform such other duties as the Chief Executive Officer and Board may from time to time reasonably direct. The Executive’s
place of employment will be in the Minneapolis, Minnesota area. During the Term, the Executive agrees to devote substantially all of his time, energy, experience and talents during regular business hours, and as otherwise reasonably necessary, to
such employment, to devote his best efforts to advance the interests of the Company and not to engage in any other business activities of a material nature, as an employee, director, consultant or in any other capacity, whether or not the Executive
receives any compensation therefor, without the prior written consent of the Board; provided, however, that Executive shall be permitted to serve as a member of the Board of Directors of the companies listed on Annex 1;
provided, further, that the Executive shall be entitled to engage in such other business activities as do not unreasonably conflict with the Executive’s duties and responsibilities to the Company pursuant to this Employment
Agreement upon notice to and consent by the Company, which consent will 
 

not be unreasonably withheld. The Executive will not be given duties inconsistent with his executive
position. 
 
Term of Employment Agreement. 
 
The term of the Executive’s employment hereunder will begin as of the
Effective Date and end as of the close of business on the Date of Termination (as defined in Section 4(h)) (the “Term”). 
 
Compensation and Benefits. 
 
Base Salary. The Executive’s base salary will be an annual rate of $230,000, payable in equal bi-weekly installments. The Board will review the
Executive’s base salary annually and make adjustments as it deems appropriate. Necessary withholding taxes, FICA contributions and the like will be deducted from the Executive’s base salary. 
 
Bonus. In addition to the Executive’s base salary, the Executive will be
entitled to receive a bonus under the Company’s Executive Bonus Plan based on the Company’s achievement of the annual EBITDA target established by the Board for each fiscal year (each an “EBITDA Target”), on the same basis
as other executives of the Company, as such plan has been described to the Executive and may be amended from time to time by the Board. The EBITDA Target for any fiscal year will be subject to adjustment by the Board, in good faith, to reflect any
acquisitions, dispositions and material changes to capital spending. 
 
Options. As of the Effective Date, the Company will grant to the Executive options to purchase a total of 180,000 shares of the Company’s common stock, $.01 par value (the “Common Stock”), at an exercise price
of $13.64 per share, which options shall be granted under the Company’s 1998 Stock Option Plan (the “Plan”). A copy of the Plan has been provided to the Executive. Such options will vest in accordance with, and will have such
other terms as provided in, the Stock Option Agreement attached hereto as Exhibit A. 
 
Other. The Executive will be entitled to such health, life, disability, pension, sick leave and other benefits as are generally made available by the Company to its executive employees. The Executive will also accrue five
weeks paid vacation during each year during the Term, in accordance with and subject to the Company’s vacation policy. 
 
Stock Purchase. The Executive shall be entitled to purchase up to 34,000 shares of the Company’s common stock at a purchase price of $13.64 per
share, subject to the terms of the offering memorandum attached as Exhibit B and the stock subscription agreement attached as Exhibit C. 
 
Termination. 
 
Death. This Employment Agreement will automatically terminate upon the Executive’s death. In the event of such termination, the Company will pay to the Executive’s legal representatives the
Executive’s base salary in monthly installments and continue to 
 

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provide the benefits provided hereunder, in each case for twelve months following such termination.

 
Disability. If during the Term the Executive becomes physically
or mentally disabled whether totally or partially, either permanently or so that the Executive is unable substantially and competently to perform his duties hereunder for a period of 90 consecutive days or for 90 days during any six-month period
during the Term (a “Disability”), the Company may terminate the Executive’s employment hereunder by written notice to the Executive. In the event of such termination, the Company will pay to the Executive his base salary in
monthly installments and continue to provide the benefits provided hereunder, in each case for twelve months following such termination. 
 
Cause. The Executive’s employment hereunder may be terminated at any time by the Company for Cause (as defined herein) by written notice to the
Executive. In the event of such termination, all of the Executive’s rights to payments (other than payment for services already rendered) and any other benefits otherwise due hereunder will cease immediately. The Company will have
“Cause” for termination of the Executive’s employment hereunder if any of the following has occurred: 
 
the commission by the Executive of a felony for which he is convicted; or 
 
the material breach by the Executive of his agreements or obligations under this Agreement, if such breach is
described in a written notice to the Executive referring to this Section 4(c)(ii), and such breach is not capable of being cured or has not been cured within thirty (30) days after receipt of such notice. 
 
Without Cause. The Executive’s employment hereunder may be terminated at
any time by the Company without Cause by written notice to the Executive. In the event of such termination, the Company shall (i) continue to pay the Executive the Executive’s base salary and provide the Executive continued group health plan
benefits at the active employee rate and in accordance with the Executive’s group health plan elections on the date of termination through the date that is twelve months following the Date of Termination and (ii) pay to Executive within 10 days
following the Date of Termination, a lump sum payment equal to the amount of Executive’s bonus that would have been payable to the Executive for the fiscal year in which the Date of Termination occurs had the Company achieved 100% of the then
applicable EBITDA Target for such fiscal year. 
 
Resignation
Without Good Reason. The Executive may terminate the Executive’s employment hereunder upon sixty days’ prior written notice to the Company, without Good Reason (as defined herein). In the event of such termination, all of the
Executive’s rights to payment (other than payment for services already rendered) and any other benefits otherwise due hereunder will cease upon the date of such termination. 
 
Resignation For Good Reason. The Executive may terminate the Executive’s employment hereunder at any time upon thirty
days’ written notice to the Company, for Good Reason. In the event of such termination, the Company shall (i) continue to pay the Executive the Executive’s base salary and provide the Executive the benefits provided in Section 3(d)
hereunder through the date that is twelve months following the Date of Termination and (ii) pay to Executive within 10 days following the Date of Termination, 
 

3 

a lump sum payment equal to the amount of Executive’s bonus that would have been payable to the
Executive for the fiscal year in which the Date of Termination occurs had the Company achieved 100% of the then applicable EBITDA Target for such fiscal year. 
 
The Executive will have “Good Reason” for termination of the Executive’s employment hereunder if, other than for Cause, any of the
following has occurred: 
 
the Executive’s
base salary or the bonus (as a percentage of base salary) to which the Executive may be entitled as the result of the Company reaching the then applicable EBITDA Target under the Executive Bonus Plan has been reduced other than in connection with an
across-the-board reduction (of approximately the same percentage) in executive compensation to executive employees imposed by the Board in response to negative financial results or other adverse circumstances affecting the Company; 
 
the Board establishes an unachievable and commercially
unreasonable EBITDA Target that the Company must achieve in order for the Executive to receive a bonus under Section 3(b) of this Employment Agreement; 
 
the Company has reduced or reassigned a material portion of the Executive’s duties hereunder, has required the Executive to relocate
outside the greater Minneapolis, Minnesota area or has relocated the corporate headquarters of the Company outside the greater Minneapolis, Minnesota area or has removed or relocated outside the greater Minneapolis area, a material number of
employees or senior management of the Company; or 
 
the Company has breached this Employment Agreement in any material respect. 
 
Change of Control. If the Executive is terminated without Cause or resigns for Good Reason at any time within six months prior to, or twenty-four months following, a Change of Control, or the Executive
terminates employment for any reason during the thirty (30) day period following the six month anniversary of the Change of Control, and notwithstanding Sections 4(d) and 4(f), and in lieu of amounts provided under Sections 4(d) and 4(f), the
Company shall (i) continue to pay the Executive the Executive’s base salary and provide the Executive the benefits provided in Section 3(d) hereunder through the date that is twelve months following the Date of Termination and (ii) pay to
Executive within 10 days following the Date of Termination, a lump sum payment equal to the amount of Executive’s bonus that would have been payable to the Executive for the fiscal year in which the Date of Termination occurs had the Company
achieved 100% of the then applicable EBITDA Target for such fiscal year. Notwithstanding any provision of this Employment Agreement to the contrary, in the event that any payment or benefit received or to be received by the Executive in connection
with a Change in Control of the Company or termination of Executive’s employment constitutes a “parachute payment,” within the meaning of Section 280G(b)(2) of the Internal Revenue Code of 1986, as amended (the
“Code”) which would be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then the Company shall pay the Executive in cash an additional amount (the “Gross-Up
Payment”) such that, after payment by Executive of all taxes, including but not limited to income taxes (and any interest and penalties imposed with respect thereto) and the Excise Tax imposed upon the Gross-Up Payment, the Executive
retains an amount of the Gross-Up Payment equal to the Excise Tax imposed on the parachute payments. For purposes of this Section 4(g), “Change of Control” shall mean when any “person” (as defined in Section 13(d)
and 14(d) of the Securities Exchange Act of 1934), other than the Company, J.W. Childs Equity Partners, L.P. or 
 

4 

any of its affiliates, any trustee or other fiduciary holding securities under an employee benefit plan of
the Company or any Subsidiary, or any corporation owned, directly or indirectly, by the stockholders of the Company, in substantially the same proportions as their ownership of stock of the Company, acquires, in a single transaction or a series of
transactions (i) “beneficial ownership” (as defined in Rule 13d-3 under the Securities Exchange Act of 1934) of securities representing more than 50% of the combined voting power of the Company (or, prior to a public offering, more
than 50% of the Company’s outstanding shares of Common Stock), or (ii) substantially all of the assets of the Company. For purposes of this Section 4(g), “Subsidiary” shall mean any corporation in an unbroken chain of
corporations beginning with the Company if, at the time of a Change of Control, each of the corporations (other than the last corporation in the unbroken chain) owns stock possessing 50% or more of the total combined voting power of all classes of
stock in one of the other corporations in the chain. 
 
Date and
Effect of Termination. The date of termination of the Executive’s employment hereunder, pursuant to this Section 4, will be, (i) in the case of Section 4(a), the date of the Executive’s death, (ii) in the case of Sections 4(b), (c) or (d),
the date specified as the last day of employment in the Company’s notice to the Executive of such termination, (iii) in the case of Section 4(e), or 4(f), the date specified in the Executive’s notice to the Company of such termination (in
each case, the “Date of Termination”), or (iv) in the case of Section 4(g), the date specified in the Executive’s notice to the Company for resignation for Good Reason or the Company’s notice to the Executive for
termination without Cause. Upon any termination of the Executive’s employment hereunder pursuant to this Section 4, the Executive will not be entitled to any further payments or benefits of any nature pursuant to this Employment Agreement,
or as a result of such termination, except as specifically provided for in this Employment Agreement or the Stockholders’ Agreement between the Company and the equity security holders of the Company (the “Stockholders’
Agreement”), in any stock option plans adopted by the Company in accordance with Section 3(b) hereof, or as may be required by law. 
 
Terminations Not a Breach. The termination of the Executive’s employment pursuant to this Section 4 shall not constitute a breach of this Employment
Agreement by the party responsible for the termination, and the rights and responsibilities of the parties under this Employment Agreement as a result of such termination shall be as described in this Section 4. 
 
Acknowledgment. The Executive agrees and acknowledges that in the course of
rendering services to the Company and its clients and customers, the Executive will have access to and become acquainted with confidential information about the professional, business and financial affairs of the Company and its affiliates. The
Executive acknowledges that the Company is engaged and will be engaged in a highly competitive business, and the success of the Company in the marketplace depends upon its good will and reputation for quality and dependability. The Executive
recognizes that in order to guard the legitimate interests of the Company and its affiliates, it is necessary for the Company to protect all confidential information. The existence of any claim or cause of action by the Executive against the Company
shall not constitute and shall not be asserted 
 

5 

as a defense to the enforcement by the Company of Section 6. The Executive further agrees that the
Executive’s obligations under Section 6 shall be absolute and unconditional. 
 
Confidentiality. The Executive agrees that during and at all times after the Term, the Executive will keep secret all confidential matters and materials of the Company (including its subsidiaries and affiliates), including,
without limitation, know-how, trade secrets, real estate plans and practices, individual office results, customer lists, pricing policies, operational methods, any information relating to the Company (including any of its subsidiaries and
affiliates) products, processes, customers and services and other business and financial affairs of the Company (collectively, the “Confidential Information”), to which the Executive had or may have access and will not disclose such
Confidential Information to any person other than the Company, their respective authorized employees and such other people to whom the Executive has been instructed to make disclosure by the Board, in each case only to the extent required in
connection with court process. “Confidential Information” will not include any information which is in the public domain during or after the Term, provided such information is not in the public domain as a consequence of disclosure by the
Executive in violation of this Employment Agreement. 
 
Modification. The Executive agrees and acknowledges that the perpetual duration and scope of the covenants described in Section 6 are fair, reasonable and necessary in order to protect the good will and other legitimate
interests of the Company and its subsidiaries, that adequate consideration has been received by the Executive for such obligations, and that these obligations do not prevent the Executive from earning a livelihood. If, however, for any reason any
court of competent jurisdiction determines that any restriction contained in Section 6 is not reasonable, that consideration is inadequate or that the Executive has been prevented unlawfully from earning a livelihood, such restriction will be
interpreted, modified or rewritten to include as much of the duration, scope and geographic area identified in Section 6 as will render such restrictions valid and enforceable. 
 
Equitable Relief. The Executive acknowledges that the Company will suffer irreparable harm as a result of a breach of this
Employment Agreement by the Executive for which an adequate monetary remedy does not exist and a remedy at law may prove to be inadequate. Accordingly, in the event of any actual or threatened breach by the Executive of any provision of this
Employment Agreement, the Company will, in addition to any other remedies permitted by law, be entitled to obtain remedies in equity, including without limitation specific performance, injunctive relief, a temporary restraining order and/or a
permanent injunction in any court of competent jurisdiction, to prevent or otherwise restrain any such breach without the necessity of proving damages, posting a bond or other security, and to recover any and all costs and expenses, including
reasonable counsel fees, incurred in enforcing this Employment Agreement against the Executive, and the Executive hereby consents to the entry of such relief against the Executive and agrees not to contest such entry. Such relief will be in addition
to and not in substitution of any other remedies available to the Company. The existence of any claim or cause of action by the Executive against the Company or any of its subsidiaries, 
 

6 

whether predicated on this Employment Agreement or otherwise, will not constitute a defense to the
enforcement by the Company of this Employment Agreement. The Executive agrees not to defend on the basis that there is an adequate remedy at law. 
 
Life Insurance. The Company may, at its discretion and at any time after the execution of this Employment Agreement, apply for and procure, as owner and
for its own benefit, and at its own expense, insurance on the Executive’s life, in such amount and in such form or forms as the Company may determine. The Executive will have no right or interest whatsoever in such policy or policies, but the
Executive agrees that the Executive will, at the request of the Company, submit himself to such medical examinations, supply such information and execute and deliver such documents as may be required by the insurance company or companies to which
the Company or any such subsidiary has applied for such insurance. 
 
Successors; Assigns; Amendment; Notice. This Employment Agreement will be binding upon and will inure to the benefit of the Company and will not be assigned by the Company without the Executive’s prior written consent. This
Employment Agreement will be binding upon the Executive and will inure to the benefit of the Executive’s heirs, executors, administrators and legal representatives, but will not be assignable by the Executive. This Employment Agreement may be
amended or altered only by the written agreement of the Company and the Executive. All notices or other communications permitted or required under this Employment Agreement will be in writing and will be deemed to have been duly given if delivered
by hand, by facsimile transmission to the Company (if confirmed) or mailed (certified or registered mail, postage prepaid, return receipt requested) to the Executive or the Company at the last known address of the party, or such other address as
will be furnished in writing by like notice by the Executive or the Company to the other. 
 
Entire Agreement. This Employment Agreement, together with the agreements specifically referred to herein, embodies the entire agreement and understanding between the Executive and the Company with respect to the subject
matter hereof and supersedes all such prior agreements and understandings. 
 
Severability. If any term, provision, covenant or restriction of this Employment Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Employment Agreement will remain in full force and effect and will in no way be affected, impaired or invalidated. 
 
Governing Law. This Employment Agreement will be governed by and construed and enforced in accordance with the laws of the state of Minnesota applicable
to contracts made and to be performed in such state without giving effect to the principles of conflicts of laws thereof. 
 
Counterparts. This Employment Agreement may be executed in two or more counterparts, each of which will be deemed an original but all of which together
will 
 

7 

constitute one and the same instrument, and all signatures need not appear on any one counterpart.

 
Headings. All headings in this Employment Agreement are for
purposes of reference only and will not be construed to limit or affect the substance of this Employment Agreement. 
 
 

	 UNIVERSAL HOSPITAL SERVICES, INC.

	
	 By:
	 	 
	 	 	

	
	 Name:
	 	 
	 	 	

	
	 Title:
	 	 
	 	 	

	
	 	 	 
	
	 /s/     Joseph P. Schiesl

 Joseph P. Schiesl

 
 

8

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