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Receivables Transfer and Servicing Agreement - Carcorp. Inc. and Collins & AIkman Products Co.

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                                                        EXECUTION COPY







                                    CARCORP, INC.
                                           
                           COLLINS & AIKMAN PRODUCTS CO., 
                                  as Master Servicer

                                                      


                     RECEIVABLES TRANSFER AND SERVICING AGREEMENT

                                                      



                              Dated as of July 13, 1994



                                    CHEMICAL BANK,
                               as Administrative Agent






<PAGE>




                                   TABLE OF CONTENTS


                                                                       Page

                                       ARTICLE I

                                      Definitions . . . . . . . . . . .   1
                 1.1  Defined Terms . . . . . . . . . . . . . . . . . .   1
                 1.2  Other Definitional Provisions . . . . . . . . . .   1

                                       ARTICLE II

                   Acquisition and Transfer of Participating Interest .   2
                 2.1  Acquisition and Transfer of Participating
                      Interest  . . . . . . . . . . . . . . . . . . . .   2
                 2.2  Payment for Initial Transfer of a Participating
                      Interest and any Increase in Net Investment . . .   4
                 2.3  Acquisition and Transfer Procedure  . . . . . . .   4
                 2.4  Commitment Fees . . . . . . . . . . . . . . . . .   5
                 2.5  Fee and Purchase Discount Amount Calculations . .   5
                 2.6  Interest on Overdue Payments  . . . . . . . . . .   5
                 2.7  Establishment of Accounts; Allocation of
                      Collections; Reinvestment of Principal
                      Collections . . . . . . . . . . . . . . . . . . .   6
                 2.8  Payments; Pro Rata Treatment  . . . . . . . . . .   9
                 2.9  Netting of Payments . . . . . . . . . . . . . . .   9
                 2.10  Termination or Reduction of Commitment . . . . .  10
                 2.11  Optional Retransfer; Reduction of Net
                      Investment  . . . . . . . . . . . . . . . . . . .  10
                 2.12  Mandatory Reductions in Net Investment . . . . .  10


                                      ARTICLE III

                                    Increased Costs . . . . . . . . . .  12
                 3.1  Illegality  . . . . . . . . . . . . . . . . . . .  12
                 3.2  Indemnity . . . . . . . . . . . . . . . . . . . .  12
                 3.3  Requirements of Law . . . . . . . . . . . . . . .  13
                 3.4  Inability to Determine Eurodollar Rate  . . . . .  14

            3.5  Taxes  . . . . . . . . . . . . . . . . . . . . . . . .  15

                                       ARTICLE IV

                                      Termination . . . . . . . . . . .  18




                                  -i-

<PAGE>

                                                                       Page

            4.1  Termination  . . . . . . . . . . . . . . . . . . . . .  18

                                       ARTICLE V

                       Covenants, Representations and Warranties  . . .  18

            5.1  Representations and Warranties of the Company
                 Relating to the Company  . . . . . . . . . . . . . . .  18
                 (a)  Organization; Corporate Powers  . . . . . . . . .  18
                 (b)  Authorization . . . . . . . . . . . . . . . . . .  19
                           (c)  Enforceability  . . . . . . . . . . . .  19
                 (d)  Consents  . . . . . . . . . . . . . . . . . . . .  19
                 (e)  Litigation, etc . . . . . . . . . . . . . . . . .  19
                 (f)  No Default, etc . . . . . . . . . . . . . . . . .  20
                 (g)  Ownership of Property; Liens  . . . . . . . . . .  20
                 (h)  Investment Company Act; Other Regulations . . . .  20
                 (i)  Taxes . . . . . . . . . . . . . . . . . . . . . .  20
                 (j)  Ownership; Subsidiaries . . . . . . . . . . . . .  21
                 (k)  Accuracy and Completeness of Information  . . . .  21
                 (l)  Pro Forma Balance Sheet . . . . . . . . . . . . .  21
                 (m)  No Material Adverse Change  . . . . . . . . . . .  21
                      (n)  Solvency . . . . . . . . . . . . . . . . . .  21
                      (o)  Employee Benefit Plans . . . . . . . . . . .  22
                 5.2  Representations and Warranties of the Company
                      Relating to this Agreement and the Receivables  .  22
                 5.3  Retransfer Obligation . . . . . . . . . . . . . .  24
                 5.4  Obligations Unaffected  . . . . . . . . . . . . .  24

                                       ARTICLE VI

                  Conditions to Effectiveness/Transfers/Reinvestments .  25
                 6.1  Effective Date  . . . . . . . . . . . . . . . . .  25
                 6.2  Condition to each Increase in Net Investment  . .  27

                                      ARTICLE VII

                                 Affirmative Covenants  . . . . . . . .  28
                 7.1  Financial Statements  . . . . . . . . . . . . . .  28
                 7.2  Certificates; Other Information . . . . . . . . .  29
                 7.3  Existence; Businesses and Properties; Insurance;
                      Receivables . . . . . . . . . . . . . . . . . . .  29
                 7.4  Taxes . . . . . . . . . . . . . . . . . . . . . .  30
                 7.5  Inspection of Property; Books and Records;
                      Discussions . . . . . . . . . . . . . . . . . . .  30
                 7.6  Notices . . . . . . . . . . . . . . . . . . . . .  30
                 7.7  ERISA . . . . . . . . . . . . . . . . . . . . . .  31
                 7.8  Use of Proceeds . . . . . . . . . . . . . . . . .  31



                                       -ii-

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                                                                       Page

                 7.9  Separate Corporate Existence  . . . . . . . . . .  31
                 7.10  Facility Rating  . . . . . . . . . . . . . . . .  31
                 7.11  Lockbox Agreements . . . . . . . . . . . . . . .  32
                 7.12  Eligible Letters of Credit . . . . . . . . . . .  32
                 7.13  Company Policies . . . . . . . . . . . . . . . .  32

                                      ARTICLE VIII

                                   Negative Covenants . . . . . . . . .  32
                 8.1  Accounting of Transfers . . . . . . . . . . . . .  32
                 8.2  Limitation on Indebtedness  . . . . . . . . . . .  32
                 8.3  Limitation on Liens . . . . . . . . . . . . . . .  32
                 8.4  Limitation on Guarantees  . . . . . . . . . . . .  33
                 8.5  Limitation on Fundamental Changes . . . . . . . .  33
                 8.6  Limitation on Sale of Assets  . . . . . . . . . .  33
                 8.7  Limitation on Dividends and Payments on
                      Subordinated Notes  . . . . . . . . . . . . . . .  33
                 8.8  Business of the Company . . . . . . . . . . . . .  33
                 8.9  Limitation on Investments, Loans and Advances . .  33
                 8.10  Limitation on Sales and Leasebacks . . . . . . .  33
                 8.11  Transactions with Affiliates . . . . . . . . . .  34
                 8.12  Capital Stock  . . . . . . . . . . . . . . . . .  34
                 8.13  Amendments . . . . . . . . . . . . . . . . . . .  34
                 8.14  Receivables Sale Agreement, etc  . . . . . . . .  34
                 8.15  Policies . . . . . . . . . . . . . . . . . . . .  34
                 8.16  No Powers of Attorney  . . . . . . . . . . . . .  34
                 8.17  Receivables Not To Be Evidenced by Promissory
                      Notes . . . . . . . . . . . . . . . . . . . . . .  34
                 8.18  Ownership of Assets and Property . . . . . . . .  34
                 8.19  Rescission or Cancellation . . . . . . . . . . .  35
                 8.20  Ineligible Receivables . . . . . . . . . . . . .  35
                 8.21  Offices  . . . . . . . . . . . . . . . . . . . .  35
                 8.22  Addition of Sellers  . . . . . . . . . . . . . .  35
                 8.23  Optional Termination of Seller . . . . . . . . .  35
                 8.24  Operating Expenses . . . . . . . . . . . . . . .  35

                                       ARTICLE IX

                                 Events of Termination  . . . . . . . .  36

                                       ARTICLE X

                                The Administrative Agent  . . . . . . .  39
                 10.1  Appointment  . . . . . . . . . . . . . . . . . .  39
                 10.2  Delegation of Duties . . . . . . . . . . . . . .  40
                 10.3   Exculpatory Provisions  . . . . . . . . . . . .  40



                                    -iii-

<PAGE>


                                                                       Page

                 10.4  Reliance by the Administrative Agent . . . . . .  40
                 10.5  Notice of Default or Termination Event . . . . .  41
                 10.6  Non-Reliance on the Administrative Agent and
                      Other Banks . . . . . . . . . . . . . . . . . . .  41
                 10.7  Indemnification  . . . . . . . . . . . . . . . .  41
                 10.8  The Administrative Agent in Its Individual
                      Capacity  . . . . . . . . . . . . . . . . . . . .  42
                 10.9  Successor Administrative Agent . . . . . . . . .  42

                                       ARTICLE XI

                                     Miscellaneous  . . . . . . . . . .  42
                 11.1  Further Assurances . . . . . . . . . . . . . . .  43
                 11.2  Payments . . . . . . . . . . . . . . . . . . . .  43
                 11.3  Costs and Expenses . . . . . . . . . . . . . . .  43
                 11.4  Successors and Assigns; Participations;
                      Acquiring Banks . . . . . . . . . . . . . . . . .  44
                 11.5  GOVERNING LAW  . . . . . . . . . . . . . . . . .  46
                 11.6  No Waiver; Cumulative Remedies . . . . . . . . .  47
                 11.7  Amendments and Waivers . . . . . . . . . . . . .  47
                 11.8  Severability . . . . . . . . . . . . . . . . . .  47
                 11.9  Notices  . . . . . . . . . . . . . . . . . . . .  48
                 11.10  Counterparts  . . . . . . . . . . . . . . . . .  48
                 11.11  Construction of Agreement as Security
                      Agreement . . . . . . . . . . . . . . . . . . . .  48
                 11.12  Adjustments; Set-off  . . . . . . . . . . . . .  49
                 11.13  Jurisdiction; Consent to Service of Process . .  49
                 11.14  Acknowledgements  . . . . . . . . . . . . . . .  50
                 11.15  Waiver of Jury Trial  . . . . . . . . . . . . .  50
                 11.16  Confidentiality . . . . . . . . . . . . . . . .  51
                 11.17  No Bankruptcy Petition  . . . . . . . . . . . .  51
                 11.18  Tax Treatment . . . . . . . . . . . . . . . . .  51
                 11.19  No Action by Banks  . . . . . . . . . . . . . .  51

                                      ARTICLE XII

                                       Servicing
            . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  52
                 12.1  Servicing  . . . . . . . . . . . . . . . . . . .  52
                 12.2  Collections by the Servicers . . . . . . . . . .  55
                 12.3  Maintenance of Records . . . . . . . . . . . . .  57
                 12.4  Rebates, Adjustments, Returns and Reductions;
                      Modifications . . . . . . . . . . . . . . . . . .  58
                 12.5  Daily Reports; Settlement Statements . . . . . .  58
                 12.6  Representations, Warranties and Covenants of
                      the Servicers . . . . . . . . . . . . . . . . . .  60
                 12.7  Acquisition Obligation . . . . . . . . . . . . .  65
                 12.8  Obligations Unaffected . . . . . . . . . . . . .  67
                 12.9  Addition of Servicers  . . . . . . . . . . . . .  67
                 12.10  Optional Termination of Servicers . . . . . . .  67


                                 -iv-

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                                                                       Page

                 12.11  Interest on Overdue Payments  . . . . . . . . .  67
                 12.12  Servicer Events of Defaults . . . . . . . . . .  67
                 12.13  Audit . . . . . . . . . . . . . . . . . . . . .  69


            ANNEX X    Definitions

            SCHEDULES

               1       Names, Addresses and Commitments of Banks
               2       Location of Chief Executive Offices; Location of
                       Books and Records
               3       Lockboxes 
               4       Transactions with Affiliates
               5       Contractual Obligations
               6       Local Counsel
               
            EXHIBITS

               A       Form of Assignment and Acceptance
               B       Form of Lockbox Agreement
               C       Form of Subordination Agreement
              *D-1     Form of Opinion of Cravath, Swaine & Moore
                       (Corporate)
              *D-2     Form of Opinion of Cravath, Swaine & Moore
                       (Bankruptcy)
              *D-3     Form of Opinion of Elizabeth R. Philipp, Esq.,
                       general counsel of Collins      & Aikman Corporation
              *D-4     Form of Opinion of Stikeman, Elliott, special
                       Canadian counsel 
              *D-5     Form of Opinion of Local Counsel
               E       Form of Settlement Statement
               F       Form of Additional Servicer Supplement
               G       Form of Responsible Officer's Certificate as to
                       Solvency, etc. 
               H       Form of Daily Report
               I       Form of Receivables Sale Agreement




                       *  Omitted


                                  -v-

<PAGE>





                    RECEIVABLES TRANSFER AND SERVICING AGREEMENT, dated as of
          July 13, 1994, among CARCORP, INC., a Delaware corporation (the
          "Company"), COLLINS & AIKMAN PRODUCTS CO., a Delaware corporation
          ("C&A Products"), as master servicer (in 
          such capacity, the "Master Servicer"), C&A Products and each of the
          subsidiaries of C&A Products from time to time parties hereto, in
          their capacities as servicers of receivables (in such capacities,
          the "Servicers"), the several financial institutions from time to
          time parties to this Agreement (the "Banks") and CHEMICAL BANK, a
          New York banking corporation, as administrative agent for the
          Banks.  

                                 W I T N E S S E T H :

                    WHEREAS, the Company desires to assign and transfer to
          the Banks, and the Banks desire to acquire a Participating Interest
          (as hereinafter defined) in, all the Company's right, title and
          interest in, to and under the Receivables (as hereinafter defined)
          now existing or hereafter created and in the rights of the Company
          in, to and under all other Related Property (as hereinafter
          defined);

                    NOW, THEREFORE, in consideration of the premises and of
          the mutual covenants herein contained, the parties hereto agree as
          follows: 


                                       ARTICLE I

                                      Definitions

                     1.1  Defined Terms.  Capitalized terms used in this
          Agreement shall have the respective meanings assigned to such terms
          in Annex X hereto unless otherwise defined herein.

                     1.2  Other Definitional Provisions.  (a)  The words
          "hereof", "herein" and "hereunder" and words of similar import when
          used in this Agreement shall refer to this Agreement as a whole and
          not to any particular provision of this Agreement, and article,
          section, subsection, schedule and exhibit references are to this
          Agreement unless otherwise specified.

                    (b)  As used herein and in any certificate or other
          document made or delivered pursuant hereto, accounting terms
          relating to C&A Products and its Subsidiaries, unless otherwise
          defined herein, shall have the respective meanings given to them
          under GAAP.

                    (c)  The meanings given to terms defined herein shall be
          equally applicable to both the singular and plural forms of such
          terms.




<PAGE>

                                                                        2



                                       ARTICLE II

                   Acquisition and Transfer of Participating Interest

                    2.1  Acquisition and Transfer of Participating Interest. 
          (a)  By execution of this Agreement and subject to the terms and
          conditions contained herein, the Company does hereby sell,
          transfer, assign, set over and otherwise convey, without recourse
          (except as expressly provided herein), to the Banks on the
          Effective Date and from time to time during the Commitment Period,
          and each Bank hereby severally agrees to acquire from the Company
          on the Effective Date and from time to time during the Commitment
          Period, a Participating Interest (up to the maximum amount
          specified in subsection 2.3) in all right, title and interest of
          the Company in, to and under the following, whether now owned or
          hereafter acquired (collectively, with the property described in
          subsections 2.1(b) and 2.1(c), the "Pooled Property"):

                      (i)  all Receivables;

                     (ii)  (A)  all goods, if any, relating to the sale which
               gave rise to any Receivable;

                         (B)  all other security interests or liens and
                    property subject thereto from time to time purporting to
                    secure payment of any Receivable, whether pursuant to the
                    contract related to such Receivable or otherwise,
                    together with all financing statements or similar
                    instruments signed by an Obligor describing any
                    collateral securing such Receivable; 

                         (C)  all guarantees, insurance and other agreements
                    or arrangements of whatever character from time to time
                    supporting or securing payment of any Receivable whether
                    pursuant to the contract related to such Receivable or
                    otherwise; and

                         (D)  all rights (including rescission, replevin or
                    reclamation) relating to any Receivable or arising
                    therefrom; 

                    (iii)  all monies due or to become due with respect to
               the foregoing, including, without limitation, all Recoveries;
               and

                     (iv)  all proceeds of the foregoing, including, without
               limitation, whatever is received upon the sale, exchange,
               collection or other disposition of the foregoing or proceeds
               thereof (the items described in clauses (ii), (iii) and (iv),
               collectively, the "Related Property").

                    (b)  The Company hereby assigns to the Administrative
          Agent, for the benefit of the Banks, and grants to the
          Administrative Agent, for the benefit of the Banks, a security
          interest in, all its right, title and interest in, to and under the
          Receivables Sale Agreement, including (i) all rights of the Company
          to receive moneys due and to become due under or pursuant to such
          agreement, whether payable as fees, expenses, costs or otherwise,
          (ii) all rights of the Company to receive proceeds of any
          insurance, indemnity, warranty or guaranty with 



<PAGE>

                                                                            3


          respect to such agreement, (iii) claims of the Company for damages 
          arising out of or for breach of or default under such agreement, 
          (iv) the right of the Company to amend, waive or terminate such 
          agreement, to perform thereunder and to compel performance and 
          otherwise exercise all remedies thereunder and (v) all other 
          rights, remedies, powers, privileges and claims of the Company 
          under or in connection with such agreement (whether arising pursuant 
          to such agreement or otherwise available to the Company at law or 
          in equity), including the rights of the Company to enforce such 
          agreement and to give or withhold any and all consents, requests, 
          notices, directions, approvals, extensions or waivers under or in 
          connection therewith (the Pooled Property described in this 
          sentence being referred to herein as the "Transferred Agreement").

                    (c)  In addition, to secure the obligations of the
          Company hereunder, the Company hereby grants to the Administrative
          Agent, for the benefit of the Banks, a security interest in all
          right, title and interest of the Company in, to and under the
          following, whether now owned or hereafter acquired:

                    (i)  all equipment in all its forms, wherever located,
               now or hereafter existing (including all software, data bases,
               materials, books, records, magnetic tapes, disks and cassettes
               relating to the Receivables and all other equipment in which
               information concerning the Receivables is stored), and all
               parts thereof and accessions thereto (any and all such
               equipment, parts and accessions being the "Equipment");

                    (ii)  all the following (the "Accounts"):

                         (A)  each Concentration Account and each Lockbox
                    Account, all funds and other evidences of payment held
                    therein and all certificates and instruments, if any,
                    from time to time representing or evidencing any of such
                    Accounts or any funds and other evidences of payment held
                    therein;

                         (B)  any operating account or other accounts of the
                    Company, all funds held therein and all certificates and
                    instruments, if any, from time to time representing or
                    evidencing any such operating account or any funds held
                    therein;

                         (C)  all Cash Equivalents and all certificates and
                    instruments from time to time representing or evidencing
                    the Cash Equivalents;

                         (D)  all notes, certificates of deposit and other
                    instruments from time to time hereafter delivered to, or
                    otherwise possessed by, the Administrative Agent for and
                    on behalf of the Company in substitution for or in
                    addition to any of the then existing Accounts; and

                         (E)  all interest, dividends, cash, instruments and
                    other property from time to time received, receivable or
                    otherwise distributed in respect of or in exchange for
                    any and all of the then existing Accounts; and

                    (iii)  all proceeds of or payments in respect of any and
               all of the foregoing (including proceeds that constitute
               property of the types described in clauses (i) and (ii) above
               and including Collections) and, to the extent not otherwise
               included, all payments 


<PAGE>


                                                                          4

               under insurance (whether or not the Administrative Agent is 
               the loss payee in respect thereof), or any indemnity, warranty 
               or guaranty, payable by reason of loss or damage to or 
               otherwise with respect to any of the Pooled Property.

                    2.2  Payment for Initial Transfer of a Participating
          Interest and any Increase in Net Investment.  The undivided
          participating interest of the Banks in the Receivables and the
          Related Property (the "Participating Interest"; a Bank's Commitment
          Percentage of such Participating Interest shall equal such Bank's
          "Participating Interest") shall equal, at any date of determination
          thereof, the Net Investment at such date.  The Company shall notify
          the Banks of the amount of the initial transfer and assignment of a
          Participating Interest or any request for an Increase in Net
          Investment pursuant to subsection 2.3.  The amount which the Banks
          shall pay for such initial transfer and assignment or Increase in
          Net Investment shall equal the amount of such initial transfer and
          assignment or Increase in Net Investment, as the case may be. 
          After receipt by the Administrative Agent of the notice required by
          subsection 2.3(a) from the Company, the Administrative Agent shall
          promptly provide notice (which may be telephonic but shall be
          confirmed in writing) to each Bank of the Closing Date and of the
          portion of the Participating Interest or the Increase in Net
          Investment allocable to such Bank on such Closing Date.  Amounts
          payable to the Company in respect of the initial transfer and
          assignment of a Participating Interest or any Increase in Net
          Investment on such Closing Date shall be obtained by the
          Administrative Agent from the Banks and paid by the Administrative
          Agent to the Company in accordance with the provisions of
          subsection 2.8(a).  

                    2.3  Acquisition and Transfer Procedure.  (a)  Subject to
          subsections 2.3(b) and 6.2, the initial transfer and assignment of
          a Participating Interest or an Increase in Net Investment of the
          Banks shall occur, upon notice from the Company, on the Effective
          Date and on any Business Day during the Commitment Period (each
          date on which the initial transfer and assignment of a
          Participating Interest in the Receivables or an Increase in Net
          Investment of the Banks occurs hereunder being herein referred to
          as the "Closing Date" applicable to such transfer and assignment or
          such increase, as the case may be) and shall take place at the
          office of the Administrative Agent or such other place as may be
          mutually agreed upon, provided that the Company shall have given
          the Administrative Agent irrevocable notice (effective upon
          receipt) of such request no later than (i) if the initial transfer
          and assignment of a Participating Interest or the Increase in Net
          Investment on such date is to be priced solely with reference to
          ABR, 12:00 Noon (New York City time) one Business Day prior to such
          Closing Date or (ii) if all or a portion of the initial transfer
          and assignment of a Participating Interest or the Increase in Net
          Investment is to be allocated to a Fixed Tranche, 12:00 Noon (New
          York City time) three Business Days prior to such Closing Date,
          provided, further, that the provisions of this subsection 2.3 shall
          not restrict the allocations of Collections pursuant to subsection
          2.7.  Such notice shall state (i) the Closing Date, (ii) the amount
          of the initial transfer and assignment of a Participating Interest
          or the Increase in Net Investment, as the case may be, for the
          proposed transaction, (iii) what portion thereof will be allocated
          to a Fixed Tranche and/or the Floating Tranche and (iv) if any
          portion thereof is to be allocated to a Fixed Tranche, the length
          of the Transfer Period therefor.

                    (b)  Each Bank shall have no obligation to acquire a
          Participating Interest or to increase its pro rata share of the Net
          Investment on any Closing Date hereunder:



<PAGE>



                                                                          5

                    (1)  unless, in the case of an Increase in Net
               Investment, the Increase in Net Investment on such Closing
               Date is equal to at least $500,000 or an integral multiple
               thereof;

                    (2)  to the extent that, after giving effect to (A) in
               the case of the initial transfer and assignment of a
               Participating Interest, such transfer, and (B) in the case of
               an Increase in Net Investment, such Increase in Net Investment
               on such date, the Net Investment would exceed the Maximum
               Transfer Amount; or

                    (3)  if the Commitments of the Banks have terminated
               pursuant to Article IX.

          The initial transfer and assignment of the Participating Interest
          or an Increase in Net Investment allocable to the Banks as a group
          shall be allocated to each Bank according to the Commitment
          Percentage of such Bank.

                     2.4  Commitment Fees.  The Company agrees to pay to the
          Administrative Agent, for the account of the Banks, a commitment
          fee (the "Commitment Fee") for the Commitment Period, computed at
          the rate of 3/8ths of 1% per annum on the average daily excess of
          the Maximum Commitment over the Net Investment for each day during
          the period for which such Commitment Fee is payable.  Commitment
          Fees shall be payable in arrears on each Settlement Date for the
          relevant Settlement Period.

                     2.5  Fee and Purchase Discount Amount Calculations.  (a) 
          Calculations of per annum rates under this Agreement shall be made
          on the basis of a 360-day year for actual days elapsed, except that
          Commitment Fees and Purchase Discount Amounts on the Floating
          Tranche determined by reference to the Prime Rate shall be
          calculated on the basis of a 365- (or 366-, as the case may be) day
          year.  Each determination of the Eurodollar Rate hereunder by the
          Administrative Agent shall be conclusive and binding upon each of
          the parties hereto in the absence of manifest error.  Any change in
          the Purchase Discount Amount resulting from a change in ABR or
          Statutory Reserves shall become effective as of the opening of
          business on the day on which such change is announced.

                    (b)  Anything contained in this Agreement to the contrary
          notwithstanding, (i) the portion of the Net Investment allocable to
          any Fixed Tranche must be an amount equal to $10,000,000 or an
          integral multiple of $1,000,000 in excess thereof, (ii) no more
          than ten Fixed Tranches shall be outstanding at any one time, and
          (iii) after the occurrence and during the continuance of any
          Termination Event, at the end of the related Transfer Period all of
          the Net Investment allocated to any Fixed Tranche shall be
          reallocated to the Floating Tranche.

                     2.6  Interest on Overdue Payments.  If any amount
          payable by the Company to the Banks or the Administrative Agent
          hereunder, whether on account of fees or expenses or on account of
          amounts collected by the Company or amounts payable by the Company
          pursuant to Article III or subsection 5.3, or otherwise, is not
          paid by the Company or otherwise on the relevant Settlement Date or
          other relevant date, such amount shall be payable together with
          interest, payable on demand, for each day from such Settlement Date
          or other relevant date, as the case may be, until such amount is
          paid in full at a rate per annum equal to the ABR plus the
          Applicable ABR Margin plus 2%.



<PAGE>



                                                                          6


                     2.7  Establishment of Accounts; Allocation of
          Collections; Reinvestment of Principal Collections.

                    (a)  (i)  The Administrative Agent shall establish and
          maintain in the name of the Administrative Agent (x) with Chemical
          one account in the United States (the "U.S. Concentration
          Account"), (y) with a financial institution acceptable to the
          Administrative Agent one account in Canada for the purpose of
          receiving certain Collections in U.S. Dollars (the "Canada/U.S.
          Dollar Concentration Account") and (z) with a financial institution
          acceptable to the Administrative Agent one account in Canada for
          the purpose of receiving Collections in Canadian Dollars (the
          "Canada/Canadian Dollar Concentration Account").  Collections
          deposited into each Lockbox Account will be transferred to the
          relevant Concentration Account as set forth in Article XII (either
          directly or through an intermediate Lockbox Account at the same
          Lockbox Bank); provided that Collections may, at the option of the
          applicable Obligor, be deposited directly into the relevant
          Concentration Account by wire transfer from an account of such
          Obligor to the Concentration Account or by means of transfer
          through the Automated Clearing House System, as set forth in
          Article XII.  All Collections otherwise received by any Servicer,
          the Master Servicer or the Company shall be deposited by it either
          to a Lockbox Account or through the Automated Clearing House System
          into the relevant Concentration Account as set forth in Article
          XII.  The Administrative Agent shall have sole and exclusive
          dominion over and control of each Concentration Account and the
          Company, the Servicers and the Master Servicer shall not have any
          dominion over or control of any such account.

                    (ii)  Amounts deposited in any Concentration Account
          shall be invested by the Administrative Agent as directed by the
          Master Servicer in Cash Equivalents maturing not later than the
          next Business Day.

                    (iii)  Any earnings (net of losses and investment expenses)
          on such invested funds in any Concentration Account ("Investment
          Earnings") will be treated as Collections and retained therein.

                    (iv)  Neither the Company nor the Master Servicer nor any
          Servicer nor any Person claiming by, through or under the Company,
          any Servicer or the Master Servicer shall have any right, title or
          interest in, or any control over the use of, or any right to
          withdraw moneys from, any Concentration Account, except the right
          to give directions for investments of amounts on deposit therein as
          expressly provided for in paragraph (ii) above.

                    (b)  Prior to the commencement of an Amortization Period,
          the Collections, Retransfer Payments, Servicer Transfer Payments
          and Adjustment Payments deposited in the Concentration Accounts
          (collectively, "Receivables Proceeds")  shall be applied by the
          Administrative Agent on each Business Day, as follows:

                    (i)  first, if such Business Day is a Settlement Date, to
               the payment of the Monthly Servicing Fee of any Servicer that
               is not an Affiliate of the Company, the Master Servicer or any
               Seller;

                    (ii)  second, on each Purchase Discount Amount Payment
               Date occurring during the period commencing on the date of the
               first transfer and assignment of the 



<PAGE>



                                                                       7



               Participating Interest in Receivables and Related Property 
               pursuant to subsection 2.3(a) and ending on the date on which 
               the Net Investment is equal to zero and the Commitments of the 
               Banks have terminated, to the payment in arrears of accrued 
               Purchase Discount Amount on such Business Day to the Banks in 
               respect of the Participating Interest;

                    (iii)  third, to the payment of (x) the Commitment Fees
               and (y) any other amounts, if any, accrued and payable on such
               Business Day to the Administrative Agent and the Banks in
               respect of the Participating Interest;

                    (iv)  fourth, to the payments, if any, required by
               subsection 2.12 (Mandatory Reductions in Net Investment) on
               such Business Day;



                    (v)  fifth, to the payment of the Company's indemnity
               obligations hereunder and, then, to the Company's operating
               account for the payment of the operating expenses of the
               Company incurred or reserved for on such Business Day,
               provided that the aggregate amounts paid to the Company's
               operating account pursuant to this clause (v) shall not
               exceed, for any fiscal year of the Company, $250,000;

                    (vi)  sixth, if such Business Day is a Settlement Date,
               to the payment of the Monthly Servicing Fee of any Servicer
               that is an Affiliate of the Company, the Master Servicer or
               any Seller;

                    (vii)  seventh, to the Company to enable the Company to
               acquire Receivables from the Sellers pursuant to the
               Receivables Sale Agreement in the aggregate amount specified
               in the applicable Daily Report, provided that the Company may
               elect to (A) retain all or any portion of such amounts in the
               Concentration Accounts and (B) on the next Reduction Date, if
               the Company shall have given the Administrative Agent
               irrevocable notice in accordance with subsection 2.11(b), have
               all or any portion of such amounts remitted to the Banks on
               such Reduction Date and have the Net Investment reduced
               accordingly (subject to the payment by the Company of any
               amounts required pursuant to subsection 3.2);

                    (viii)  eighth, at the Company's option and subject to
               the terms of this Agreement and the Subordinated Notes, to
               make payments on account of the Subordinated Notes, in the
               aggregate amount specified in the applicable Daily Report;

                    (ix)  ninth, to the extent such expenses are not paid
               pursuant to clause (v) above, to the Company's operating
               account for the payment of the operating expenses of the
               Company incurred or reserved for such Business Day; and

                    (x)  tenth, at the Company's option and subject to the
               terms of this Agreement, to the Company to enable the Company
               to make payments on account of Restricted Payments in the
               aggregate amount specified in the applicable Daily Report, so
               long as the outstanding principal amount of the Subordinated
               Notes shall be zero at the time of such payment and all
               accrued interest thereon shall have been paid in full; 


<PAGE>


                                                                            8


          provided, that (I) in no event shall any Receivables Proceeds be
          distributed from the Concentration Accounts with respect to clauses
          (iii)(y) and (iv)-(x) above on the first or second Business Day
          next preceding any Purchase Discount Amount Payment Date or
          Settlement Date to the extent the amount remaining in the U.S.
          Concentration Account would be less than the aggregate of the
          amounts referred to in clauses (i), (ii) and (iii)(x) above payable
          on such Purchase Discount Amount Payment Date or Settlement Date;
          (II) in no event shall any Receivables Proceeds be distributed from
          the Concentration Accounts with respect to clauses (iv)-(x) above
          to the extent such distribution would necessitate a payment under
          subsection 2.12; (III) in no event shall any Receivables Proceeds
          be distributed from the Concentration Accounts with respect to
          clauses (vii)-(x) above (other than a distribution in accordance
          with the proviso in clause (vii)), if a Potential Termination Event
          of a type set forth in subsection 9(b)(ii) has occurred and is
          continuing; (IV) in no event shall any Receivables Proceeds be
          distributed from the Concentration Accounts with respect to clauses
          (viii)-(x) above if a Termination Event shall have occurred and be
          continuing or would occur as a result of such payment; and (V)
          Receivables Proceeds shall first be distributed out of the U.S.
          Concentration Account and the Canada/U.S. Dollar Concentration
          Account before any distributions are made out of the
          Canada/Canadian Dollar Concentration Account (except in the case of
          distributions to be applied to make payments in Canadian Dollars,
          which shall instead be distributed out of the Canada/Canadian
          Dollar Concentration Account so long as all obligations having a
          prior claim to Receivables Proceeds have been paid in full).

                    (c)  During any Amortization Period, all Receivables
          Proceeds shall be applied by the Administrative Agent as follows: 
          (i) first, (x) to the payment of Monthly Servicing Fees of any
          Servicer that is not an Affiliate of the Company, the Master
          Servicer or any Seller and (y) to the payment of the reasonable
          operating expenses of the Company and (to the extent approved by
          the Required Banks) any Servicer that is an Affiliate of the
          Company, the Master Servicer or any Seller, (ii) second, to the
          payment to each Bank of its Commitment Percentage of such
          Receivables Proceeds until such time as the Net Investment and
          Purchase Discount Amounts thereon and the payment of all other
          amounts that are payable to the Administrative Agent and its
          Affiliates and the Banks shall have been paid in full and (iii)
          after such time as the Net Investment and Purchase Discount Amounts
          thereon and all other amounts that are due and payable to the
          Administrative Agent and the Banks shall have been paid in full,
          the remainder to the Company.

                    (d)  The Master Servicer shall as soon as possible after
          receipt of any Collections and other proceeds determine whether or
          not they are with respect to Purchased Receivables and shall as
          soon as possible notify the Administrative Agent of such
          determination.  The Administrative Agent shall as soon as possible
          thereafter transfer any Collections that are not with respect to
          Purchased Receivables from the relevant Concentration Account to
          the Master Servicer for payment to the applicable Person, provided,
          that with respect to any Collections for which the Administrative
          Agent has not been provided such a determination by the Master
          Servicer by the end of the Business Day five Business Days from the
          date of receipt thereof, such Collections shall be deemed to be
          Collections with respect to Purchased Receivables and no other
          Person shall have any rights therein except to the extent provided
          in applicable state laws governing the laws of restitution and
          mistake.  Notwithstanding the foregoing, during any Amortization
          Period the Administrative Agent shall apply all cash collections
          and other proceeds received in respect of an Obligor with respect
          to all Receivables of such Obligor first, to pay the 


<PAGE>


                                                                        9


          outstanding principal balance of Purchased Receivables (on the date 
          of such notification) of such Obligor until Purchased Receivables with
          respect to such Obligor are paid in full and second, amounts in
          excess thereof shall be paid to the Master Servicer for payment to
          the Person legally entitled thereto to pay the outstanding
          principal balance of all remaining Receivables with respect to such
          Obligor.  The Master Servicer agrees that in making each such
          determination with respect to Collections and other proceeds, the
          Master Servicer represents and warrants at such time, to the best
          of the Master Servicer's knowledge, that such determination is true
          and correct.

                    2.8  Payments; Pro Rata Treatment.  (a)  Not later than
          11:00 a.m. (New York City time) on each date on which the Banks are
          notified to remit payments to the Administrative Agent or as the
          Administrative Agent shall direct on account of any Increase in Net
          Investment, each Bank shall make available to the Administrative
          Agent or as the Administrative Agent shall direct an amount in
          immediately available funds equal to the amount of such remittance
          calculated as provided herein.  The Administrative Agent shall
          credit the proceeds of such payments in a timely manner in
          accordance with the instructions of the Company.   

                    (b)  Unless the Administrative Agent shall have been
          notified in writing by any Bank prior to a Closing Date that such
          Bank will not make the amount which would constitute its portion of
          the Participating Interest or Increase in Net Investment on such
          date available to the Administrative Agent, the Administrative
          Agent may assume that such Bank has made such amount available to
          the Administrative Agent on such Closing Date, and the
          Administrative Agent may, in reliance upon such assumption, make
          available to the Company, a corresponding amount.  If such amount
          is made available to the Administrative Agent on a date after such
          Closing Date, such Bank shall pay to the Administrative Agent on
          demand an amount equal to the product of (i) the daily average
          Federal Funds Effective Rate during such period, times (ii) the
          amount of such Bank's portion of the Participating Interest or
          Increase in Net Investment, times (iii) a fraction the numerator of
          which is the number of days that elapse from and including such
          Closing Date to the date on which such Bank's funds shall have
          become immediately available to the Administrative Agent and the
          denominator of which is 360.  A certificate of the Administrative
          Agent submitted to any Bank with respect to any amounts owing under
          this subsection 2.8(b) shall be conclusive, absent manifest error. 
          If such Bank's portion of the Participating Interest or Increase in
          Net Investment is not in fact made available to the Administrative
          Agent by such Bank within three Business Days of such Closing Date,
          the Administrative Agent shall be entitled to recover such amount
          with interest thereon at a per annum rate equal to the ABR plus the
          Applicable ABR Margin, on demand, from the Company.  No provision
          contained in this subsection 2.8(b) shall prejudice any rights of
          the Company against any Bank.

                    (c)  Except where an amount is payable to a particular
          Bank, the amount of such collections and amounts paid allocable to
          the Banks to be remitted to each Bank shall be such Bank's
          Commitment Percentage of the aggregate amount thereof allocable to
          the Banks.

                    2.9  Netting of Payments.  Anything contained in this
          Agreement to the contrary notwithstanding, the Administrative Agent
          may, in its sole discretion, net any amounts the Administrative
          Agent is required to make available to the Company on any day
          pursuant to subsection 2.7(b) or any other subsection of this
          Agreement against any amounts the 


<PAGE>

                                                                        10



          Administrative Agent is required to make available to the Banks on 
          such day pursuant to subsection 2.7(b) or any other provision of 
          this Agreement.

                    2.10  Termination or Reduction of Commitment.  The
          Company may on any Settlement Date, upon three Business Days' prior
          written notice to the Administrative Agent (effective upon
          receipt), (i) terminate the Banks' Commitments hereunder or
          (ii) reduce the Maximum Commitment hereunder in an amount equal to
          $5,000,000 or a whole multiple of $1,000,000 in excess thereof;
          provided, that the Maximum Commitment may not be reduced below the
          Net Investment.  After receipt by the Administrative Agent of any
          such notice from the Company, the Administrative Agent shall
          promptly provide a copy of such notice to each Bank.  Upon any such
          reduction, the Commitment of each Bank shall be reduced pro rata
          according to the Commitment Percentage of such Bank.  Upon any such
          termination or reduction as aforesaid, the Maximum Commitment of
          the Banks shall terminate or be reduced, as the case may be.  Any
          such termination shall not in any way affect the Company's
          obligations under Article III hereof.  Once terminated or reduced,
          the Commitments of the Banks cannot be reinstated unless otherwise
          agreed in writing by all of the Banks.

                     2.11  Optional Retransfer; Reduction of Net Investment. 
          (a)  On any Settlement Date during the Amortization Period on which
          the Net Investment equals 10% or less of the Net Investment as of
          the first day of the Amortization Period, the Company shall have
          the option, exercisable upon three Business Days' prior notice to
          the Administrative Agent (effective upon receipt), to acquire the
          Banks' total Participating Interest at a transfer price equal to
          the Net Investment plus all accrued and unpaid fees (including
          without limitation, Purchase Discount Amounts) to the date of such
          transfer plus any amounts payable pursuant to subsections 3.2 and
          3.3.  After receipt by the Administrative Agent of any such notice
          from the Company, the Administrative Agent shall promptly provide a
          copy of such notice to each Bank.

                    (b)  The Company may, in accordance with subsection
          2.7(b)(vii), reduce the Net Investment on any date (a "Reduction
          Date") which is a Business Day, without premium or penalty (other
          than amounts payable pursuant to subsection 3.2), upon at least
          three Business Days' irrevocable notice to the Administrative
          Agent, in the case of reductions in the Net Investment that are
          part of any Fixed Tranche, and one Business Day's irrevocable
          notice to the Administrative Agent, in the case of reductions in
          the Net Investment that are part of the Floating Tranche,
          specifying (a) the Tranches to be reduced, (b) the date and amount
          of such reduction and (c) if such reduction is of a combination of
          Fixed Tranche amounts and Floating Tranche amounts, the amount of
          reduction allocable to each (and, with respect to such Fixed
          Tranche, each Tranche thereof).  Upon receipt of any such notice,
          the Administrative Agent will promptly notify each Bank thereof. 
          If any such notice is given, amounts on deposit in the
          Concentration Accounts shall be applied pursuant to subsection
          2.7(b)(vii) on the date specified therein.  Each reduction of the
          Net Investment pursuant to this subsection 2.11(b) shall be in an
          amount equal to the lesser of (x) a whole multiple of $1,000,000
          and (y) the Net Investment then outstanding.

                    2.12  Mandatory Reductions in Net Investment.  (a)  On
          any Business Day on which the Net Investment exceeds the Maximum
          Transfer Amount (except to the extent Excess Application Amounts in
          respect of such excess are being held in a cash collateral account
          pursuant to subsection 2.12(c)), all Receivables Proceeds shall be
          applied on such Business Day 




<PAGE>


                                                                      11



          to reduce the Net Investment (and the Purchase Discount Amounts 
          accrued on the portion thereof so repaid) in such amount as shall 
          be necessary so that after giving effect to such payment there shall 
          be no such excess and, to the extent such Receivables Proceeds are 
          not sufficient to pay such excess (and the Purchase Discount Amount 
          accrued thereon) on such Business Day, all subsequent Receivables 
          Proceeds shall be applied to pay such excess (and the Purchase 
          Discount Amounts accrued thereon) until so paid.

                    (b)  Notwithstanding anything to the contrary set forth
          in this Agreement, any mandatory reduction hereunder shall be
          applied, unless the Administrative Agent receives instructions from
          the Company otherwise, (i) first, to the Floating Tranche, (ii)
          second, to any Fixed Tranche the then applicable Transfer Period
          with respect to which ends on the date of the relevant payment and
          (iii) third, unless otherwise directed by the Company pursuant to
          subsection 2.12(c), to the other Fixed Tranches as selected by the
          Administrative Agent in its sole discretion, provided that, in any
          event, the Company shall pay such amounts, if any, required by
          subsection 3.2.

                    (c)  In the event the amount of any mandatory reduction
          required to be made on any date pursuant to this subsection 2.12
          shall exceed the aggregate of the amounts described in clauses (i)
          and (ii) of paragraph (b) above with respect to such date (the
          amount of any such excess being called the "Excess Application
          Amount"), the Company shall have the right, in lieu of making such
          reduction in full, to first apply such reduction in the manner
          contemplated by said clauses (i) and (ii) and to deposit an amount
          equal to the Excess Application Amount with the Administrative
          Agent in a cash collateral account maintained (pursuant to
          documentation satisfactory to the Administrative Agent) by and in
          the sole dominion and control of the Administrative Agent.  Any
          amounts so deposited shall be held by the Administrative Agent as
          collateral for the obligations of the Company hereunder and applied
          to the reduction of the applicable Fixed Tranches at the end of the
          current Transfer Periods applicable thereto.  On any Business Day
          on which (x) collected amounts remain on deposit in or to the
          credit of such cash collateral account after giving effect to the
          payments made on such day pursuant to this paragraph (c) and (y)
          the Company shall have delivered to the Administrative Agent a
          written request or a telephonic request (which shall be promptly
          confirmed in writing) that such remaining collected amounts be
          invested in the Cash Equivalents specified in such request, the
          Administrative Agent shall use its reasonable efforts to invest
          such remaining collected amounts in such Cash Equivalents;
          provided, that the Administrative Agent shall have continuous
          dominion and full control over any such investments (and over any
          interest that accrues thereon) to the same extent that it has
          dominion and control over such cash collateral account and no Cash
          Equivalent shall mature after the end of the Transfer Period for
          which it is to be applied.  Unless a Termination Event or Potential
          Termination Event then exists or would result, the Company shall
          have the right to withdraw any amount from such cash collateral
          account if (i) the applicable Fixed Tranches have been reduced to
          zero and accrued Purchase Discount Amount thereon has been paid in
          full or (ii) the Net Investment has otherwise ceased to exceed the
          Maximum Transfer Amount. 

                    (d)  All payments under this subsection 2.12 shall be
          subject to subsection 3.2 but otherwise without premium or penalty. 
          All payments in reduction of the Net Investment under this
          subsection 2.12 shall be accompanied by the Purchase Discount
          Amounts on the amount being paid accrued to the date of payment.


<PAGE>


                                                                         12



                                      ARTICLE III

                                    Increased Costs

                    3.1  Illegality.  (a)  Notwithstanding any other
          provision herein, if the adoption of or any change in any law or
          regulation or in the interpretation thereof by any Governmental
          Authority charged with the administration or interpretation thereof
          shall make it unlawful for any Bank to purchase or maintain a
          Eurodollar Participating Interest as contemplated by this Agreement
          or to give effect to its obligations as contemplated hereby with
          respect to any portion of the Net Investment allocated to any Fixed
          Tranche, then, by written notice to the Company and to the
          Administrative Agent, such Bank may:

                     (i)  declare that a Eurodollar Participating Interest
               will not thereafter be purchased or maintained by such Bank
               hereunder, whereupon any request by the Company for a
               Eurodollar Participating Interest shall, as to such Bank only,
               be deemed a request for an ABR Participating Interest unless
               such declaration shall be subsequently withdrawn; and

                     (ii)  require that the outstanding Eurodollar
               Participating Interest of such Bank be converted to an ABR
               Participating Interest, in which event such Eurodollar
               Participating Interest shall be automatically converted to an
               ABR Participating Interest as of the effective date of such
               notice as provided in paragraph (b) below.

          In the event any Bank shall exercise its rights under clause (i) or
          (ii) above, all payments which would otherwise have been applied to
          reduce the Eurodollar Participating Interest that would have been
          held by such Bank or the converted Eurodollar Participating
          Interest of such Bank shall instead be applied to reduce the ABR
          Participating Interest made by such Bank in lieu of, or resulting
          from the conversion of, such Eurodollar Participating Interest.

                    (b)  For purposes of this subsection 3.1, a notice to the
          Company by any Bank shall be effective as to each Fixed Tranche, if
          lawful, on the last day of the Transfer Period currently applicable
          to such Fixed Tranche; in all other cases such notice shall be
          effective on the date of receipt by the Company.

                    3.2  Indemnity.  The Company shall indemnify each Bank
          against any loss or expense (other than taxes) which such Bank may
          sustain or incur as a consequence of (a) any failure by the Company
          to fulfill on the date of any Increase in Net Investment or
          proposed Increase in Net Investment hereunder the applicable
          conditions set forth in Article VI, (b) any failure by the Company
          to effectuate an Increase in Net Investment or to convert or
          continue any Fixed Tranche or Floating Tranche hereunder after
          irrevocable notice of such increase, conversion or continuation has
          been given pursuant hereto, (c) any reduction or conversion of a
          Fixed Tranche required by any other provision of this Agreement or
          otherwise made or deemed made on a date other than the last day of
          the Transfer Period applicable thereto, (d) any default in
          reduction in respect of the Net Investment or any part thereof or
          the payment of Purchase Discount Amount accrued thereon, as and
          when such reduction is required or such amount is due and payable,
          as the case may be, or (e) the occurrence of any Termination Event,
          including, in 


<PAGE>

                                                                        13



          each such case, any loss or reasonable expense sustained or 
          incurred or to be sustained or incurred in liquidating
          or employing deposits from third parties acquired to effect or
          maintain any Participating Interest or any part thereof as a
          Eurodollar Participating Interest.  Such loss or reasonable expense
          shall exclude loss of margin hereunder but shall include an amount
          equal to the excess, if any, as reasonably determined by such Bank,
          of (i) its cost of obtaining the funds for the Participating
          Interest being reduced, converted or not transferred, converted or
          continued (assumed to be the Eurodollar Rate applicable thereto)
          for the period from the date of such reduction, conversion or
          failure to transfer, convert or continue to the last day of the
          Transfer Period for such Eurodollar Participating Interest (or, in
          the case of a failure to transfer, convert or continue, the
          Transfer Period for such Eurodollar Participating Interest which
          would have commenced on the date of such failure) over (ii) the
          amount of interest (as reasonably determined by such Bank) that
          would be realized by such Bank in reemploying the funds in an
          amount equal to the amount of such reduction or conversion or the
          amount not transferred, converted or continued for such period or
          Transfer Period, as the case may be.  A certificate of any Bank
          setting forth any amount or amounts which such Bank is entitled to
          receive pursuant to this subsection 3.2 (and the reasons therefor)
          shall be delivered to the Company through the Administrative Agent
          and shall be conclusive absent manifest error.
           
                     3.3  Requirements of Law.  (a)  Notwithstanding any
          other provision herein, if after the date of this Agreement any
          change in applicable law or regulation or in the interpretation or
          administration thereof by any Governmental Authority charged with
          the interpretation or administration thereof (whether or not having
          the force of law) shall change the basis of taxation of payments to
          any Bank in respect of the Eurodollar Participating Interest of
          such Bank or any fees or other amounts payable hereunder (other
          than changes in respect of (i) taxes imposed on the overall net
          income of such Bank by the jurisdiction in which such Bank has its
          principal office or by any political subdivision or taxing
          authority therein and (ii) any Taxes described in subsection 3.5),
          or shall impose, modify or deem applicable any reserve, special
          deposit or similar requirement against assets or deposits with or
          for the account of or credit extended by such Bank (except any such
          reserve requirement which is reflected in the Eurodollar Rate) or
          shall impose on such Bank or the interbank eurodollar market any
          other condition affecting this Agreement or the Eurodollar
          Participating Interest of such Bank, and the result of any of the
          foregoing shall be to increase the cost to such Bank of purchasing
          or maintaining its Eurodollar Participating Interest or to reduce
          the amount of any sum received or receivable by such Bank hereunder
          (whether in repayment of the Net Investment, payment of any
          Purchase Discount Amount or otherwise) by an amount deemed by such
          Bank to be material, then the Company will pay to such Bank upon
          demand such additional amount or amounts as will compensate such
          Bank for such additional costs incurred or reduction suffered.

                    (b)  If any Bank shall have determined that the adoption
          after the date hereof of any law, rule, regulation or guideline
          regarding capital adequacy, or any change after the date hereof in
          any of the foregoing or in the interpretation or administration of
          any of the foregoing by any Governmental Authority, central bank or
          comparable agency charged with the interpretation or administration
          thereof, or compliance by any Bank (or any purchasing office of
          such Bank) or any Bank's holding company with any request or
          directive regarding capital adequacy (whether or not having the
          force of law) made or issued after the date hereof by any such
          authority, central bank or comparable agency, has or would have the
          effect of reducing the rate of return on such Bank's capital or on
          the capital of such Bank's holding company, if any, 


<PAGE>


                                                                       14



          as a consequence of this Agreement or its obligations pursuant hereto
          to a level below that which such Bank or such Bank's holding company
          would have achieved but for such adoption, change or compliance
          (taking into consideration such Bank's policies and the policies of
          such Bank's holding company with respect to capital adequacy) by an
          amount deemed by such Bank to be material, then from time to time
          the Company shall pay to such Bank such additional amount or
          amounts as will compensate such Bank or such Bank's holding company
          for any such reduction suffered.


                    (c)  A certificate of each Bank setting forth such amount
          or amounts as shall be necessary to compensate such Bank or its
          holding company as specified in paragraph (a) or (b) above, as the
          case may be, shall be delivered to the Company and shall be
          conclusive absent manifest error.  The Company shall pay each Bank
          the amount shown as due on any such certificate delivered by it
          within 10 days after its receipt of the same.

                    (d)  In the event any Bank delivers a notice pursuant to
          paragraph (e) below, the Company may require, at the Company's
          expense and subject to subsection 3.2, such Bank to assign, at par
          plus accrued Purchase Discount Amount and fees, without recourse
          (in accordance with subsection 11.4) all its interests, rights and
          obligations hereunder (including all of its Commitment and the
          Participating Interests at the time held by it) to a financial
          institution specified by the Company provided that (i) such
          assignment shall not conflict with or violate any law, rule or
          regulation or order of any court or other Governmental Authority,
          (ii) the Company shall have received the written consent of the
          Administrative Agent, which consent shall not unreasonably be
          withheld, to such assignment and (iii) the Company shall have paid
          to the assigning Bank all monies accrued and owing hereunder to it
          (including pursuant to this subsection 3.3).

                    (e)  Promptly after any Bank has determined, in its sole
          judgment, that it will make a request for increased compensation
          pursuant to this subsection 3.3, such Bank will notify the Company
          thereof.  Failure on the part of any Bank so to notify the Company
          or to demand compensation for any increased costs or reduction in
          amounts received or receivable or reduction in return on capital
          with respect to any period shall not constitute a waiver of such
          Bank's right to demand compensation with respect to such period or
          any other period; provided that the Company shall not be under any
          obligation to compensate any Bank under subsection 3.3(b) with
          respect to increased costs or reductions with respect to any period
          prior to the date that is six months prior to such request if such
          Bank knew or could reasonably have been expected to be aware of the
          circumstances giving rise to such increased costs or reductions and
          of the fact that such circumstances would in fact result in such
          increased costs or reduction; provided, further, that, the
          foregoing limitation shall not apply to any increased costs or
          reductions arising out of the retroactive application of any law,
          regulation, rule, guideline or directive as aforesaid within such
          six month period.  The protection of this subsection 3.3 shall be
          available to each Bank regardless of any possible contention of the
          invalidity or inapplicability of the law, rule, regulation,
          guideline or other change or condition which shall have occurred or
          been imposed.

                    3.4  Inability to Determine Eurodollar Rate.  In the
          event, and on each occasion, that on the day two Business Days
          prior to the commencement of any Transfer Period for a Fixed
          Tranche the Administrative Agent shall have determined that dollar
          deposits, in the respective amounts of the portion of each Bank's
          Eurodollar Participating Interest comprising 


<PAGE>


                                                                      15



          such Fixed Tranche, are not generally available in the interbank 
          eurodollar market, or that the rates at which such dollar deposits 
          are being offered will not adequately and fairly reflect the cost to 
          any Bank of purchasing or maintaining its Eurodollar Participating 
          Interest during such Transfer Period, or that reasonable means do 
          not exist for ascertaining the Eurodollar Rate, the Administrative 
          Agent shall, as soon as practicable thereafter, give written or telex
          notice of such determination to the Company and the Banks.  If such
          notice is given, the Purchase Discount Amount applicable to that
          portion of the Net Investment that was to be allocated to a Fixed
          Tranche shall be determined by reference to the ABR.  Until such
          notice has been withdrawn by the Administrative Agent, no further
          Eurodollar Rate elections shall be made.  Each determination by the
          Administrative Agent hereunder shall be conclusive absent manifest
          error.

                    3.5  Taxes.  (a)  Any and all payments by the Company,
          any Servicer or the Master Servicer (each, a "Tax Indemnifying
          Party") to the Administrative Agent or the Banks hereunder shall be
          made, in accordance with subsection 2.8, free and clear of and
          without deduction for any and all present or future taxes, levies,
          imposts, deductions, charges or withholdings, and all liabilities
          with respect thereto, excluding (i) in the case of each Bank and
          the Administrative Agent, taxes that would not be imposed but for a
          connection between such Bank or the Administrative Agent (as the
          case may be) and the jurisdiction imposing such tax, other than a
          connection arising solely by virtue of the activities of such Bank
          or the Administrative Agent (as the case may be) pursuant to or in
          respect of this Agreement, including, without limitation, entering
          into, making purchases pursuant to, receiving payments under, or
          enforcing, this Agreement, and (ii) in the case of each Bank and
          the Administrative Agent, any United States withholding taxes
          payable with respect to payments hereunder under laws (including,
          without limitation, any statute, treaty, ruling, determination or
          regulation) in effect on the Initial Date (as hereinafter defined)
          for such Bank or the Administrative Agent, as the case may be, but
          not excluding any United States withholding taxes payable solely as
          a result of any change in such laws occurring after the Initial
          Date (all such non-excluded taxes, levies, imposts, deductions,
          charges, withholdings and liabilities being hereinafter referred to
          as "Taxes").  For purposes of this subsection 3.5, the term
          "Initial Date" shall mean (i) in the case of the Administrative
          Agent or any Bank, the date on which such Person became a party to
          this Agreement and (ii) in the case of any assignment including any
          assignment by a Bank to a new purchasing office, the date of such
          assignment.  If any Taxes shall be required by law to be deducted
          from or in respect of any sum payable hereunder to any Bank or the
          Administrative Agent (i) the sum payable by the relevant Tax
          Indemnifying Party shall be increased as may be necessary so that
          after making all required deductions (including deductions
          applicable to additional sums payable under this subsection 3.5)
          such Bank or the Administrative Agent (as the case may be) receives
          an amount equal to the sum it would have received had no such
          deductions been made, (ii) the relevant Tax Indemnifying Party
          shall make such deductions and (iii) the relevant Tax Indemnifying
          Party shall pay the full amount deducted to the relevant taxation
          authority or other authority in accordance with applicable law.  No
          Tax Indemnifying Party shall, however, be required to pay any
          amounts pursuant to clause (i) of the preceding sentence to any
          Bank or the Administrative Agent not organized under the laws of
          the United States of America or a state thereof if such Bank or the
          Administrative Agent fails to comply with the requirements of
          paragraphs (f) or (g), as the case may be, and paragraph (h) of
          this subsection 3.5.


<PAGE>


                                                                         16



                    (b)  In addition, the Company agrees to pay any present
          or future stamp or documentary taxes or any other excise or
          property taxes, charges or similar levies which arise from the
          execution, delivery or registration of, or otherwise with respect
          to, this Agreement (hereinafter referred to as "Other Taxes").

                    (c)  Each Tax Indemnifying Party will indemnify each Bank
          and the Administrative Agent for the full amount of Taxes and Other
          Taxes (including any Taxes or Other Taxes imposed by any
          jurisdiction on amounts payable under this subsection 3.5) paid by
          such Bank or the Administrative Agent, as the case may be, and any
          liability (including penalties, interest and expenses) arising
          therefrom or with respect thereto whether or not such Taxes or
          Other Taxes were correctly or legally asserted.  Such
          indemnification shall be made within 10 days after the date any
          Bank or the Administrative Agent, as the case may be, makes written
          demand therefor.  If a Bank or the Administrative Agent shall
          become aware that it is entitled to receive a refund or is
          reasonably requested by the relevant Tax Indemnifying Party to
          pursue a claim for a refund in respect of Taxes or Other Taxes, it
          shall promptly notify such Tax Indemnifying Party of the
          availability of such refund (unless instructed to pursue a claim by
          such Tax Indemnifying Party) and shall, within 30 days after
          receipt of a request by such Tax Indemnifying Party, pursue or
          timely claim such refund at such Tax Indemnifying Party's expense. 
          If any Bank or the Administrative Agent receives a refund in
          respect of any Taxes or Other Taxes for which such Bank or the
          Administrative Agent has received payment from any Tax Indemnifying
          Party hereunder, it shall promptly notify such Tax Indemnifying
          Party of such refund and shall, within 30 days after receipt of a
          request by such Tax Indemnifying Party (or promptly upon receipt,
          if such Tax Indemnifying Party has requested application for such
          refund pursuant hereto), repay such refund (plus any interest
          received) to such Tax Indemnifying Party, provided that such Tax
          Indemnifying Party, upon the request of such Bank or the
          Administrative Agent, agrees to return such refund (plus any
          penalties, interest or other charges required to be paid) to such
          Bank or the Administrative Agent in the event such Bank or the
          Administrative Agent is required to repay such refund.

                    (d)  Within 30 days after the date of any payment of
          Taxes or Other Taxes withheld by any Tax Indemnifying Party in
          respect of any payment to any Bank or the Administrative Agent,
          such Tax Indemnifying Party will furnish to the Administrative
          Agent, at its address referred to in subsection 11.2, the original
          or a certified copy of a receipt evidencing payment thereof.

                    (e)  Without prejudice to the survival of any other
          agreement contained herein, the agreements and obligations
          contained in this subsection 3.5 shall survive the termination of
          this Agreement.

                    (f)  This paragraph (f) shall apply to cases where the
          Tax Indemnifying Party is a U.S. Person (within the meaning of the
          Code).  Each of each Bank and the Administrative Agent that is not
          organized under the laws of the United States of America or a state
          thereof agrees that at least 10 days prior to the first Purchase
          Discount Amount Payment Date following the Initial Date in respect
          of such Bank, it will deliver to the Company and the Administrative
          Agent (if appropriate) two duly completed copies of either (i)
          United States Internal Revenue Service Form 1001 or 4224 or
          successor applicable form, as the case may be, certifying in each
          case that such Bank or the Administrative Agent, as the case may
          be, is entitled to receive 


<PAGE>

                                                                     17



          payments under this Agreement payable to it without deduction or 
          withholding of any United States federal income taxes and backup 
          withholding taxes or is entitled to receive such payments at 
          a reduced rate pursuant to a treaty provision or (ii) in the case 
          of a Bank that is not a "bank" within the meaning of Section 
          881(c)(3) of the Code, United States Internal Revenue
          Service Form W-8 or successor applicable form and a statement from
          such Bank certifying to the fact that interest payable to it
          hereunder (A) will not be described in Section 871(h)(3)(A) or
          Section 881(c)(3)(A), (B) or (C) of the Code and (B) will not be
          effectively connected with a trade or business carried on in the
          United States by such Bank.  Each of each Bank and the
          Administrative Agent required to deliver to the Company and the
          Administrative Agent a Form 1001, 4224 or W-8 pursuant to the
          preceding sentence further undertakes to deliver to the Company and
          the Administrative Agent (if appropriate) two further copies of
          Form 1001, 4224 or W-8, or successor forms, or other similar manner
          of certification and such extensions or renewals thereof as may
          reasonably be requested by the Company and, in the case where a
          Form W-8 has been delivered, a further statement certifying to the
          fact set forth in clause (B) of the preceding sentence (i) at the
          times reasonably requested by the Company, (ii) after the
          occurrence of an event requiring a change in the most recent form
          or statement previously delivered by it to the Company or (iii) in
          the case of Form 1001, 4224 or W-8, on or before the date that any
          such form expires or becomes obsolete, and, in the case of Form
          1001 or 4224, certifying that such Bank is entitled to receive
          payments under this Agreement without deduction or withholding of
          any United States federal income taxes and backup withholding taxes
          or is entitled to receive such payments at a reduced rate pursuant
          to a treaty provision, unless such Bank advises the Company that it
          is unable lawfully to provide such forms and other certifications
          and notifies the Company to such effect.  Unless the Company and
          the Administrative Agent have received forms, certificates and
          other documents satisfactory to them indicating that payments
          hereunder to or for any Bank not incorporated under the laws of the
          United States or a state thereof are not subject to United States
          withholding tax or are subject to such tax at a rate reduced by an
          applicable tax treaty, the relevant Tax Indemnifying Party or the
          Administrative Agent, as the case may be, shall withhold such taxes
          from such payments at the applicable statutory rate.

                    (g)  This paragraph (g) shall apply to cases where the
          Tax Indemnifying Party is incorporated in or under the laws of
          Canada.  Each Bank and the Administrative Agent that is not
          incorporated within or under the laws of Canada and that is
          claiming such additional amounts agrees that within a reasonable
          period of time following the request of the relevant Tax
          Indemnifying Party, it will, to the extent it is legally entitled
          to a reduction in the rate of or exemption from Canadian
          withholding taxes, deliver to the such Tax Indemnifying Party and
          the Administrative Agent (if appropriate) any form or document
          required under the laws, regulations, official interpretations or
          treaties enacted by, made or entered into with Canada properly
          completed and duly executed by such Bank or Administrative Agent
          establishing that any payments hereunder are exempt from Canadian
          withholding tax or subject to a reduced rate of Canadian
          withholding tax, as the case may be; provided that, in the sole
          determination of such Bank or the Administrative Agent, such form
          or document shall not be otherwise disadvantageous to such Bank or
          the Administrative Agent.

                    (h)  Any Bank claiming any additional amounts payable
          pursuant to this subsection 3.5 shall use reasonable efforts
          (consistent with legal and regulatory restrictions) to file any
          certificate or document requested by the relevant Tax Indemnifying
          Party or to change 



<PAGE>

                                                                      18



          the jurisdiction of its applicable purchasing office if the 
          making of such a filing or change would avoid the need for or 
          reduce the amount of any such additional amounts which
          may thereafter accrue and would not, in the sole determination of
          such Bank, be otherwise disadvantageous to such Bank.


                                       ARTICLE IV

                                      Termination

                     4.1  Termination.  This Agreement will terminate at such
          time after the expiration of the Commitment Period when the Net
          Investment has been reduced to zero and all other amounts owing to
          the Banks and the Administrative Agent hereunder shall have been
          paid in full; provided, however, that the indemnities of the
          Company, the Servicers and the Master Servicer to the Banks and the
          Administrative Agent set forth in this Agreement (including those
          set forth in Article III) shall survive such termination.  Upon (i)
          the expiration of the Commitment Period and (ii) the reduction of
          the Net Investment to zero and the payment in full of all other
          amounts owing to the Banks and the Administrative Agent hereunder,
          the Administrative Agent shall, at the expense of the Company,
          execute such Uniform Commercial Code termination statements and
          such other documents, and take such other actions, as the Company
          may reasonably request to evidence the termination of the ownership
          interest of the Banks in the Receivables and the payment of all
          amounts owing pursuant to and in connection with this Agreement.  


                                       ARTICLE V

                       Covenants, Representations and Warranties


                    5.1  Representations and Warranties of the Company
          Relating to the Company.  The Company hereby represents and
          warrants to the Administrative Agent and the Banks, (x) as of the
          Effective Date, and (y) with respect to an Increase in Net
          Investment, as of the related Closing Date, unless, in either case,
          such representation or warranty expressly relates only to a prior
          date, that:

                    (a)  Organization; Corporate Powers.  The Company (i) is
          a corporation duly organized, validly existing and in good standing
          under the laws of the jurisdiction in which it is incorporated,
          (ii) has all requisite corporate power and authority, and all
          material licenses, permits, franchises, consents and approvals, to
          own or lease its property and assets and to carry on its business
          as now conducted and as proposed to be conducted, (iii) is
          qualified and in good standing as a foreign corporation to do
          business in every jurisdiction where such qualification is
          necessary, except where the failure so to qualify would not have a
          Material Adverse Effect and (iv) has the corporate power and
          authority to execute, deliver and perform each of the Transaction
          Documents and each agreement or instrument contemplated hereby or
          thereby to which it is or will be a party.



<PAGE>

                                                                     19



                    (b)  Authorization.  The execution, delivery and
          performance of each of the Transaction Documents to which the
          Company is a party, the assignment and transfer of the
          Participating Interests hereunder and the consummation of the other
          transactions contemplated by any of the foregoing (collectively,
          the "Transactions") (i) have been duly authorized by all requisite
          corporate and, if required, stockholder action and (ii) will not
          (x) violate (A) any provision of law, statute, rule or regulation
          (including, without limitation, Regulations G, T, U and X) or the
          certificate of incorporation or by-laws (or similar governing
          documents) of the Company, (B) any applicable order of any court or
          any rule, regulation or order of any Governmental Authority or (C)
          any indenture, certificate of designation for preferred stock,
          agreement or other instrument to which the Company is a party or by
          which the Company or any of its property is bound, (y) be in
          conflict with, result in a breach of or constitute (with notice or
          lapse of time or both) a default under any such indenture,
          agreement or other instrument where any such conflict, violation,
          breach or default referred to in clause (ii)(x) or (ii)(y) of this
          subsection 5.1(b), individually or in the aggregate, would have a
          Material Adverse Effect or (z) result in the creation or imposition
          of any Lien upon any property or assets of the Company, except for
          Liens created by this Agreement.

                    (c)  Enforceability.  This Agreement has been duly
          executed and delivered by the Company and constitutes, and each
          other Transaction Document if and when executed and delivered by
          the Company will constitute, a legal, valid and binding obligation
          of the Company enforceable against the Company in accordance with
          its terms, except as enforceability may be limited by bankruptcy,
          insolvency, moratorium, reorganization or other similar laws
          affecting creditors' rights generally and except as enforceability
          may be limited by general principles of equity (regardless of
          whether such enforceability is considered in a proceeding in equity
          or at law).

                    (d)  Consents.  All consents and approvals of, filings
          and registrations with, and other actions in respect of, all
          Governmental Authorities required in order to make or consummate
          the Transactions have been obtained, given, filed or taken and are
          in full force and effect, other than any such consents, approvals,
          filings or other actions, the failure to obtain or make which could
          not reasonably be expected to result in a Material Adverse Effect.

                    (e)  Litigation, etc.  (i)  There are not any actions,
          suits or proceedings at law or in equity or by or before any court
          or Governmental Authority now pending or, to the knowledge of the
          Company, threatened against or affecting the Company or any
          property or rights of the Company as to which there is a reasonable
          possibility of an adverse determination and which (x) if adversely
          determined, could individually or in the aggregate result in a
          Material Adverse Effect or (y) involve the Transaction Documents or
          (z) if adversely determined could materially adversely affect the
          Transactions.

                    (ii) The Company is not in default with respect to any
          law, order, judgment, writ, injunction, decree, rule or regulation
          of any Governmental Authority where such default could have a
          Material Adverse Effect.  The assignment and transfer of the
          Participating Interests hereunder, the use of the proceeds thereof
          and the other Transactions will not violate any applicable law or
          regulation or violate or be prohibited by any judgment, writ,
          injunction, decree or order of any court or Governmental Authority
          or subject the Company to any civil or criminal penalty or fine.



<PAGE>


                                                                       20



                    (f)  No Default, etc.  (i)  The Company is not a party to
          any agreement or instrument or subject to any corporate restriction
          that has resulted or could reasonably be expected to result in a
          Material Adverse Effect.

                    (ii)  No indenture, certificate of designation for
          preferred stock, agreement or other instrument to which the Company
          is a party will prohibit or materially restrain, or have the effect
          of prohibiting or materially restraining, or imposing materially
          adverse conditions upon, the consummation of any of the
          Transactions.


                    (iii)  The Company is not in default in any manner under
          any provision of any indenture or other agreement or instrument
          evidencing Indebtedness or any other material agreement or
          instrument to which it is a party or by which it or any of its
          properties or assets are or may be bound, in either case where such
          default could result in a Material Adverse Effect.  After giving
          effect to the Transactions, no Termination Event or Potential
          Termination Event shall have occurred and be continuing.

                    (g)  Ownership of Property; Liens.  The Company has good
          and marketable title to, or valid leasehold interests in, or
          easements on or other limited property interests in, all its
          material properties and assets, except for minor defects in title
          and limitations on property interests that do not interfere with
          its ability to conduct its business as currently conducted or to
          utilize such properties and assets for their intended purposes. 
          All such material properties and assets are free and clear of
          Liens, other than Liens expressly permitted by subsection 8.3.

                    (h)  Investment Company Act; Other Regulations.  (i)  The
          Company is not an "investment company", or a company "controlled"
          by an "investment company", within the meaning of the Investment
          Company Act of 1940, as amended.

                    (ii)  The Company is not a "holding company", or a
          "subsidiary company" of a "holding company", or an "affiliate" of a
          "holding company" or of a "subsidiary company" of a "holding
          company", within the meaning of the Public Utility Holding Company
          Act of 1935, as amended.

                    (iii)  The Company is not engaged principally, or as one
          of its important activities, in the business of extending credit
          for the purpose of purchasing or carrying Margin Stock.

                    (iv)  The assignment and transfer of the Participating
          Interests hereunder and the use of the proceeds thereof and the
          other Transactions will not violate or be inconsistent with the
          provisions of the Regulations of the Board, including Regulations
          G, T, U and X.

                    (i)  Taxes.  The Company has filed or caused to be filed
          all Federal, and all material state and local, tax returns required
          to have been filed by it and has paid or caused to be paid all
          taxes shown thereon to be due and payable, and any assessments
          received by it, except taxes that are being contested in accordance
          with subsection 7.4.  For purposes of this paragraph, "taxes" shall
          mean any present or future tax, levy, impost, duty, charge,
          assessment or fee of any nature (including interest, penalties and
          additions thereto) that is imposed by any Governmental Authority.



<PAGE>


                                                                    21



                    (j)  Ownership; Subsidiaries.  All the issued and
          outstanding capital stock of the Company is owned, legally and
          beneficially, by C&A Products.  The Company has no Subsidiaries.


                    (k)  Accuracy and Completeness of Information.  The
          information, reports, financial statements, exhibits and schedules
          furnished by or on behalf of the Company to the Administrative
          Agent or any Bank in connection with the negotiation of any
          Transaction Document or included therein or delivered pursuant
          thereto, when taken as a whole, did not contain, and as they may be
          amended, supplemented or modified from time to time, will not
          contain, as of the Effective Date any material misstatement of fact
          and did not omit, and as they may be amended, supplemented or
          modified from time to time, will not omit, to state as of the
          Effective Date any material fact necessary to make the statements
          therein, in the light of the circumstances under which they were,
          are or will be made, not materially misleading in their
          presentation of the Transactions or of the Company.

                    (l)  Pro Forma Balance Sheet.  The Company has heretofore
          furnished to the Administrative Agent and each of the Banks its pro
          forma balance sheet after giving effect to the transactions to take
          place on the Effective Date.  Such balance sheet (i) was prepared
          in good faith on the basis of reasonable assumptions and (ii)
          discloses all material liabilities, direct or contingent, of the
          Company as of the date thereof.

                    (m)  No Material Adverse Change.  There has been no
          material adverse change in the business, properties, assets,
          operations or financial condition of the Company (after giving
          effect to the Transactions contemplated to occur on or prior to the
          Effective Date pursuant to the Transaction Documents) since the
          date of the pro forma balance sheet referred to in paragraph (l)
          above.

                    (n)  Solvency.  (i)  The fair salable value of the assets
          of the Company exceeds the amount that will be required to be paid
          on or in respect of the existing debts and other liabilities
          (including contingent liabilities) of the Company.  After giving
          effect to the Transactions to occur on the Effective Date or such
          Closing Date, as applicable, the fair salable value of the assets
          of the Company will exceed the amount that will be required to be
          paid on or in respect of the existing debts and other liabilities
          (including contingent liabilities) of the Company. 

               (ii)  The assets of the Company do not constitute unreasonably
          small capital to carry out its business as conducted or as proposed
          to be conducted.  After giving effect to the Transactions to occur
          on the Effective Date or such Closing Date, as applicable, the
          assets of the Company will not constitute unreasonably small
          capital for the Company to carry out its business as now conducted
          and as proposed to be conducted, including the capital needs of the
          Company taking into account the particular capital requirements of
          the business conducted by it and projected capital requirements and
          capital availability thereof. 

               (iii)  The Company does not intend to incur debts beyond its
          ability to pay such debts as they mature, taking into account the
          timing and amounts of cash to be received by the Company and of
          amounts to be payable on or in respect of debt of the Company.


<PAGE>

                                                                     22



                    (o)  Employee Benefit Plans.  The Company and each of its
          ERISA Affiliates is in compliance in all material respects with the
          applicable provisions of ERISA and the regulations and published
          interpretations thereunder except for such noncompliance which
          would not be expected to result in a Material Adverse Effect.  No
          Reportable Event has occurred as to which the Company or any of its
          ERISA Affiliates was required to file a report with the PBGC, other
          than reports for which the 30 day notice requirement is waived,
          reports that have been filed and reports the failure of which to
          file would not result in a Material Adverse Effect and, as of the
          Effective Date, the present value of all benefit liabilities under
          each Plan of the Company or any of its ERISA Affiliates (on a
          termination basis and based on those assumptions used to fund such
          Plan) did not, as of the last annual valuation report applicable
          thereto, exceed by more than $7,500,000 the value of the assets of
          such Plan.  None of the Company or any of its ERISA Affiliates has
          incurred or could reasonably be expected to incur any Withdrawal
          Liability that could result in a Material Adverse Effect.  None of
          the Company or any of its ERISA Affiliates has received any
          notification that any Multiemployer Plan is in reorganization or
          has been terminated within the meaning of Title IV of ERISA, and no
          Multiemployer Plan is reasonably expected to be in reorganization
          or to be terminated where such reorganization or termination has
          resulted or could reasonably be expected to result, through
          increases in the contributions required to be made to such Plan or
          otherwise, in a Material Adverse Effect.

                    The representations and warranties set forth in this
          subsection 5.1 shall survive the initial transfer of a
          Participating Interest and any Increase in the Net Investment. 
          Upon discovery by the Company, any Bank or the Administrative Agent
          of a breach of any of the foregoing representations and warranties,
          the Person discovering such breach shall give prompt written notice
          to such other Persons.

                    5.2  Representations and Warranties of the Company
          Relating to this Agreement and the Receivables.  The Company hereby
          represents and warrants to the Administrative Agent and the Banks,
          (x) as of the Effective Date, and (y) with respect to an Increase
          in Net Investment, as of the related Closing Date, unless, in
          either case, such representation or warranty expressly relates only
          to a prior date, that:

                    (a)  The document or computer file delivered pursuant to
               subsection 6.1(j) is an accurate and complete listing in all
               material respects of all the Receivables as of the date set
               forth therein and the information contained therein with
               respect to the identity of such Receivables is true and
               correct in all material respects as of such date.  As of such
               date, the aggregate amount of Eligible Receivables is as set
               forth on such document or file.


                    (b)  The Company has not sold, assigned or transferred,
               or granted any existing Lien on, the Receivables or any of the
               other Pooled Property, or any interest therein, to any Person,
               except the Banks hereunder.

                    (c)  Other than with respect to Receivables which the
               Company shall have stated in writing (in the Daily Report or
               otherwise) on the Closing Date therefor are not Eligible
               Receivables on such date, with respect to each Receivable, all
               consents, licenses, approvals or authorizations of or
               registrations or declarations with any Governmental Authority
               required to be obtained, effected or given by the Company in
               connection with 

<PAGE>

                                                                         23



               the conveyance of such Receivable to the Banks
               have been duly obtained, effected or given and are in full
               force and effect.

                    (d)  This Agreement effects a valid transfer and
               assignment to the Banks of an undivided, participating
               ownership interest in all right, title and interest of the
               Company in the Receivables, the Related Property and the
               proceeds thereof, including Recoveries relating thereto, or,
               if this Agreement does not effect a transfer and assignment of
               such an ownership interest, it effects a grant of a "security
               interest" (as defined in the Uniform Commercial Code as in
               effect in the State of New York) in such property to the
               Banks, which, in the case of existing Receivables, the Related
               Property and the proceeds thereof, is enforceable upon
               execution and delivery of this Agreement, and which will be
               enforceable with respect to such Receivables hereafter created
               and the proceeds thereof upon such creation.  On or prior to
               the initial Closing Date, all filings and other acts necessary
               or advisable (including but not limited to all filings and
               other acts necessary or advisable under the Uniform Commercial
               Code of each relevant jurisdiction) have been made or
               performed in order to grant the Banks a first priority
               perfected ownership interest in respect of all Receivables and
               Related Property.  On the Effective Date and, in the case of
               the Receivables hereafter created and the proceeds thereof,
               upon the creation thereof, the Banks shall have a first
               priority perfected ownership or security interest in such
               property.

                    (e)  This Agreement effects a grant of a "security
               interest" (as defined in the Uniform Commercial Code as in
               effect in the State of New York) in all of the Equipment, the
               Transferred Agreement and the Accounts to the Banks, which, in
               the case of such property and the proceeds thereof existing as
               of the date hereof, is enforceable upon execution and delivery
               of this Agreement, and which will be enforceable with respect
               to such property hereafter created and the proceeds thereof
               upon such creation.  On or prior to the initial Closing Date,
               all filings and other acts necessary or advisable (including
               but not limited to all filings and other acts necessary or
               advisable under the Uniform Commercial Code of each relevant
               jurisdiction) have been made or performed in order to grant
               the Banks a first priority perfected ownership interest in
               respect of all such property.  On the Effective Date and, in
               the case of such property hereafter created and the proceeds
               thereof, upon the creation thereof, the Banks shall have a
               first priority perfected ownership or security interest in
               such property.

                    (f)  The chief executive office of the Company is listed
               on Schedule 2, which office is the place where the Company is
               "located" for the purposes of Section 9-103(3)(d) of the
               Uniform Commercial Code of the State in which such office is
               located, and the offices at which the Company keeps its
               records concerning the Receivables are also listed on said
               Schedule.

                    (g)  No Termination Event or Potential Termination Event
               has occurred and is continuing.
           
                    (h)  Each Receivable that is included by the Company in
               its determination of the aggregate Adjusted Principal Amount
               of all Eligible Receivables shall be a Receivable 


<PAGE>


                                                                         24



               with respect to which all of the criteria contained in the 
               definition of "Eligible Receivable" hereunder are satisfied. 

                    The representations and warranties set forth in this
          subsection 5.2 shall survive the initial transfer of a
          Participating Interest and any Increase in Net Investment.  Upon
          discovery by the Company, any Bank or the Administrative Agent or
          of a breach of any of the foregoing representations and warranties,
          the Person discovering such breach shall give prompt written notice
          to such other Persons.

                    5.3  Retransfer Obligation.  (a)  In the event of any
          breach of any of the representations or warranties of the Company
          contained in subsection 5.2(d), (e), (f) or (h), then upon the
          earlier to occur of the discovery of such event by the Company, or
          receipt by the Company of written notice of such event given by the
          Administrative Agent, the outstanding Principal Amount of
          Receivables shall be reduced by the Principal Amount of Receivables
          as to which such representations and warranties were breached;
          provided, however, that (i) prior to the Amortization Period, to
          the extent that such a reduction would cause the Invested
          Percentage to be more than the Maximum Invested Percentage, the
          Company agrees to acquire such Receivables and any Related Property
          with respect thereto on the terms and conditions set forth in
          paragraph (b) below and (ii) during the Amortization Period, the
          Company agrees to acquire such Receivables and any Related Property
          with respect thereto on the terms and conditions set forth in
          paragraph (b) below.

                    (b)  If any breach of a representation or warranty which
          necessitates the Company's reacquisition of a Receivable pursuant
          to paragraph (a) above remains uncured on the date which is 30 days
          after discovery or notice of such breach, the Company shall acquire
          such Receivable and any Related Property with respect thereto by
          depositing into the relevant Concentration Account in immediately
          available funds on such 30th day (or, if such day is not a Business
          Day, on the next succeeding Business Day, an amount equal to (i)
          prior to an Amortization Period, the lesser of (A) the amount
          necessary to cause the Invested Percentage to equal the Maximum
          Invested Percentage and (B) the Principal Amount of such Receivable
          or (ii) during an Amortization Period, the Principal Amount of such
          Receivables (in either case, a "Retransfer Payment").  Upon deposit
          of the Retransfer Payment, the Banks shall automatically and
          without further action be deemed to transfer, assign, set-over and
          otherwise convey to the Company, free and clear of any Lien created
          by the Banks but otherwise without recourse, representation or
          warranty, all the right, title and interest of the Banks in and to
          such Receivable, all Related Property with respect thereto, all
          monies due or to become due with respect thereto and all proceeds
          thereof; and such reacquired Receivable shall be treated by the
          Banks as collected in full as of the date on which it was
          transferred.  The Administrative Agent shall execute such documents
          and instruments of transfer or assignment and take such other
          actions as shall reasonably be requested by the Company to effect
          the conveyance of such Receivables pursuant to this subsection 5.3. 
          The obligation to reacquire any Receivable shall constitute the
          sole remedy respecting any breach of the representations,
          warranties and covenants set forth in subsection 5.2(d), (e), (f)
          or (h) with respect to such Receivables available to Banks or the
          Administrative Agent on behalf of the Banks.

                     5.4  Obligations Unaffected.  The obligations of the
          Company to the Administrative Agent and the Banks under this
          Agreement shall not be affected by reason of any 


<PAGE>

                                                                     25



          invalidity, illegality or irregularity of any Receivable or any 
          transfer and assignment of a Receivable.


                                       ARTICLE VI

                  Conditions to Effectiveness/Transfers/Reinvestments

                     6.1  Effective Date.  This Agreement shall become
          effective on the date (the "Effective Date") on which each of the
          following conditions precedent are either (x) satisfied or (y)
          waived by the Required Banks:

                    (a)  The Company, each Servicer and the Master Servicer
               shall have delivered to the Administrative Agent, with a copy
               for each Bank, (i) a copy of the certificate or articles of
               incorporation, including all amendments thereto, of such
               Person, certified as of a recent date by the Secretary of
               State of the state of incorporation thereof, and such
               certificate or articles shall be in form and substance
               satisfactory to the Administrative Agent, and a certificate as
               to the good standing of such Person as of a recent date, from
               such Secretary of State; (ii) a certificate of the Secretary
               or Assistant Secretary of such Person dated the Effective Date
               and certifying (A) that attached thereto is a true and
               complete copy of the Bylaws of such Person as in effect on the
               Effective Date and at all times since a date prior to the date
               of the resolutions described in clause (B) below, (B) that
               attached thereto is a true and complete copy of resolutions in
               form and substance satisfactory to the Administrative Agent
               and duly adopted by the Board of Directors of such Person
               authorizing the execution, delivery and performance of the
               Transaction Documents to which such Person is a party and the
               transactions contemplated thereby, and that such resolutions
               have not been modified, rescinded or amended and are in full
               force and effect, (C) that the certificate or articles of
               incorporation of such Person has not been amended since the
               date of the last amendment thereto shown on the certificate of
               good standing furnished pursuant to clause (i) above and (D)
               as to the incumbency and specimen signature of each officer
               executing any Transaction Document or any other document
               delivered in connection herewith or therewith on behalf of
               such Person; and (iii) a certificate of another officer as to
               the incumbency and specimen signature of the Secretary or
               Assistant Secretary executing the certificate pursuant to
               clause (ii) above.

                    (b)  There shall have been delivered to the
               Administrative Agent, with a copy for each Bank, the written
               opinions of (i) Cravath, Swaine & Moore, special counsel for
               the Company, the Servicers and the Master Servicer, in
               substantially the forms of Exhibits D-1 and D-2, (ii)
               Elizabeth R. Philipp, Esq., general counsel of Collins &
               Aikman Corporation, in substantially the form of Exhibit D-3,
               (iii) Stikeman, Elliott, special Canadian counsel, in
               substantially the form of Exhibit D-4, and (iv) each local
               state counsel listed on Schedule 6, in substantially the form
               of Exhibit D-5, in each case addressed to the Administrative
               Agent and the Banks, dated the Effective Date, and in form and
               substance satisfactory to the Administrative Agent, and such
               additional opinions, if any, as may be reasonably requested by
               the Administrative Agent.


<PAGE>


                                                                      26



                    (c)  Appropriate financing statements relating to the
               Receivables shall have been executed and delivered and shall
               be in proper form for filing in each appropriate filing office
               in the jurisdiction in which the Company maintains its
               principal executive office.

                    (d)  The Administrative Agent shall have received search
               reports satisfactory to the Administrative Agent dated a date
               reasonably near to the Effective Date, listing all effective
               financing statements which name the Company as debtor and
               which are filed in the jurisdictions in which filings were
               made pursuant to paragraph (c) above, together with copies of
               such other financing statements or notices of assignment (none
               of which shall cover any Receivables unless a corresponding
               termination statement has been delivered to the Administrative
               Agent). 



                    (e)  There shall have been delivered to the
               Administrative Agent search reports acceptable to the
               Administrative Agent dated a date reasonably near the
               Effective Date confirming the absence of any tax lien and
               judgment lien filings made against the Company or any of its
               assets in any filing office in any jurisdiction where filings
               were made pursuant to paragraph (c) above. 

                    (f)  The Administrative Agent shall have received a
               certificate from the Company, dated the Effective Date and
               signed by one of its Responsible Officers, in form and
               substance satisfactory to the Administrative Agent, confirming
               compliance with the conditions precedent set forth in
               subsection 6.2.

                    (g)  The Administrative Agent shall have received all
               fees and other amounts due and payable on or prior to the
               Effective Date.

                    (h)  The Administrative Agent shall have received (i) a
               copy of the Receivables Sale Agreement, duly executed on
               behalf of C&A Products, each of the Sellers and the Company
               and (ii) the Subordination Agreement, duly executed on behalf
               of each of C&A Products, each of the Sellers and the Company.

                    (i)  The initial funding under the Credit Agreement shall
               have occurred or shall occur simultaneously with the initial
               purchase under this Agreement.

                    (j)  The Administrative Agent shall have received a
               microfiche or other tangible evidence, as certified by a
               Responsible Officer of the Company, acceptable to the
               Administrative Agent, showing as of a date acceptable to the
               Administrative Agent prior to the Effective Date the Obligors
               whose Receivables have been transferred to the Company and the
               balance of the Receivables with respect to each such Obligor
               as of such date.

                    (k)  A Responsible Officer of the Company shall have
               certified that all conditions to the obligations of the
               Company and each of the Sellers under the Receivables Sale
               Agreement shall have been satisfied in all respects (or waived
               by the Required Banks).


<PAGE>

                                                                         27



                    (l)  The Administrative Agent shall have received an
               agreed-upon procedures letter relating to historical financial
               information with respect to the Receivables from independent
               auditors satisfactory to the Administrative Agent.

                    (m)  The Administrative Agent shall have received, as
               certified by a Responsible Officer of the Company, copies of
               (i) the written Policies, or, to the extent that the credit
               and collection policies of the Sellers are not in written form
               at the Effective Date, a written description of the historical
               credit and collection practices of the Sellers and proposed
               practices for the Company, in each case in form and substance
               acceptable to the Administrative Agent and (ii) the Company
               Policies.

                    (n)  The Administrative Agent shall have received
               licenses or contingent licenses, or the Administrative Agent
               shall otherwise be satisfied with its ability, to use any
               computer programs, material tapes, disks, cassettes and data
               necessary or advisable to permit the collection of the
               Receivables by a Servicer without the participation of any
               Seller or the Company.

                    (o)  The Administrative Agent shall have reviewed the
               computer programs, material, data and back-up plans of the
               Sellers required for the collection of Receivables and shall
               be satisfied that the foregoing, including the procedures of
               the Sellers for the preparation, storage and retrieval
               thereof, are sufficient to permit (i) the Company or the
               Administrative Agent to collect the Receivables with or
               without the participation of the Sellers or any servicer and
               (ii) a third-party servicer to collect the Receivables with or
               without the participation of the Sellers or the Company.

                    (p)  The composition of the Company's Board of Directors
               (including the independent director) shall be reasonably
               acceptable to the Administrative Agent.

                    (q)  The Administrative Agent shall have received the pro
               forma opening balance sheet for the Company referred to in
               subsection 5.1(l).

                    (r)  The Administrative Agent shall have received a
               certificate dated the Effective Date and signed by a
               Responsible Officer of the Company, substantially in the form
               of Exhibit G, to the effect that the Company will be solvent
               after giving effect to the transactions occurring on the
               Effective Date.

                    6.2  Condition to each Increase in Net Investment.  The
          obligations of the Banks to increase the Net Investment on any
          Closing Date is subject to the conditions that:

                    (a)  no Termination Event or Potential Termination Event
               shall have occurred and then be continuing, and no such
               Termination Event or Potential Termination Event shall occur
               as a result of the proposed Increase in Net Investment on such
               Closing Date;

                    (b)  the representations and warranties of the Company
               set forth in Article V shall be true and correct in all
               material respects on and as of such Closing Date;


<PAGE>


                                                                        28



                    (c)  the representations and warranties of the Servicers
               and the Master Servicer set forth in Article XII shall be true
               and correct in all material respects on and as of such Closing
               Date; and

                    (d)  the Administrative Agent shall have timely received
               all notices, statements and certificates relating to such
               Closing Date required by subsections 2.3 and 12.5.

          Each Increase in Net Investment on any Closing Date shall
          constitute a representation and warranty by the Company that the
          conditions to the transfer thereof on such Closing Date, as the
          case may be, have been satisfied.


                                      ARTICLE VII

                                 Affirmative Covenants

                    The Company hereby agrees that, unless and until this
          Agreement is terminated pursuant to subsection 4.1, the Company
          shall:

                    7.1  Financial Statements.  Furnish to each Bank:

                    (a)  as soon as available, but in any event within
               90 days after the end of each fiscal year of the Company, a
               copy of the balance sheet of the Company as at the end of such
               year and the related statements of income and retained
               earnings and cash flows for such year, setting forth in each
               case (beginning with the financial statements delivered for
               the 1995 fiscal year) in comparative form the figures for the
               previous year, reported on without a "going concern" or like
               qualification or exception, or qualification arising out of
               the scope of the audit, by Arthur Andersen & Co. or other
               independent certified public accountants of nationally
               recognized standing reasonably acceptable to the
               Administrative Agent; and

                    (b)  as soon as available, but in any event not later
               than 45 days after the end of each of the first three
               quarterly periods of each fiscal year of the Company, the
               unaudited balance sheet of the Company as at the end of such
               quarter and the related unaudited statements of income and
               retained earnings and cash flows of the Company for such
               quarter and the portion of the fiscal year through the end of
               such quarter, setting forth in each case, with respect to any
               such financial statements covering any fiscal quarter
               commencing after the first anniversary of the Effective Date,
               in comparative form the figures for the corresponding quarter
               and portion of the previous year, certified by a Responsible
               Officer of the Company as being fairly stated in all material
               respects (subject to normal year-end audit adjustments);

          all such financial statements shall be complete and correct in all
          material respects and shall be prepared in reasonable detail and in
          accordance with GAAP applied consistently throughout the periods
          reflected therein and with prior periods (except as approved by
          such accountants or Responsible Officer, as the case may be, and
          disclosed therein).



<PAGE>


                                                                        29



                    7.2  Certificates; Other Information.  Furnish to each
          Bank:

                    (a)  concurrently with the delivery of the financial
               statements referred to in subsection 7.1(a), a certificate of
               the independent certified public accountants reporting on such
               financial statements stating that in making the examination
               necessary therefor no knowledge was obtained of any
               Termination Event or Potential Termination Event, except as
               specified in such certificate;

                    (b)  concurrently with the delivery of the financial
               statements referred to in subsections 7.1(a) or (b), a
               certificate of a Responsible Officer of the Company stating
               that, to the best of such Responsible Officer's knowledge, the
               Company during such period has observed or performed all of
               its covenants and other agreements, and satisfied every
               condition, contained in the Transaction Documents to which it
               is a party to be observed, performed or satisfied by it, and
               that such Responsible Officer has obtained no knowledge of any
               Termination Event or Potential Termination Event, except as
               specified in such certificate; and

                    (c)  promptly, such additional financial and other
               information as any Bank may from time to time reasonably
               request by written notice to the Company (through the
               Administrative Agent).

                    7.3  Existence; Businesses and Properties; Insurance;
          Receivables.  (a)  Do or cause to be done all things necessary to
          preserve, renew and keep in full force and effect its legal
          existence.

                    (b)  Do or cause to be done all things necessary to
          obtain, preserve, renew, extend and keep in full force and effect
          the rights, licenses, permits, franchises, authorizations, patents,
          copyrights, trademarks and trade names material to the conduct of
          its business; comply in all material respects with all applicable
          laws, rules, regulations and orders of any Governmental Authority,
          whether now in effect or hereafter enacted; and at all times
          maintain and preserve all property material to the conduct of such
          business and keep such property in good repair, working order and
          condition and from time to time make, or cause to be made, all
          needful and proper repairs, renewals, additions, improvements and
          replacements thereto necessary in order that the business carried
          on in connection therewith, if any, may be properly conducted at
          all times.

                    (c)  Keep its insurable properties insured (including
          through self-insurance) at all times by financially sound and
          reputable insurers in such amounts as shall be customary for
          similar businesses and maintain such other insurance, of such
          types, to such extent and against such risks, as is customary with
          companies in the same or similar businesses; and maintain such
          other insurance as may be required by law.

                    (d)  Defend the right, title and interest of the Banks
          in, to and under the Receivables and the other Pooled Property,
          whether now existing or hereafter created, against all claims of
          third parties claiming through or under the Company, the Sellers,
          the Master Servicer or the Servicers.


<PAGE>

                                                                       30



                    (e)  Duly fulfill all material obligations on its part to
          be fulfilled under or in connection with each Receivable and do
          nothing that could reasonably be expected to impair the rights of
          the Banks in any Receivable.

                    7.4  Taxes.  Pay and discharge promptly all taxes,
          assessments and governmental charges or levies imposed upon it or
          upon its income or profits or in respect of its property, before
          the same shall become delinquent or in default, as well as all
          lawful claims for labor, materials and supplies or otherwise which,
          if unpaid, might give rise to a Lien upon such properties or any
          part thereof; provided, however, that such payment and discharge
          shall not be required with respect to any such tax, assessment,
          charge, levy or claim so long as (a) the validity or amount thereof
          shall be contested in good faith by appropriate proceedings and the
          Company shall set aside on its books adequate reserves as required
          by GAAP with respect thereto, (b) such tax, assessment, charge,
          levy or claim is in respect of property taxes for property that the
          Company has determined to abandon and the sole recourse for such
          tax, assessment, charge, levy or claim is to such property or (c)
          the amount of such taxes assessments, charges, levies and claims
          and interest and penalties thereon does not exceed $1,000,000 in
          the aggregate.   

                    7.5  Inspection of Property; Books and Records;
          Discussions.  Maintain all financial records in accordance with
          GAAP and permit any Persons designated by the Administrative Agent
          (or, during the continuance of any Termination Event, any Bank) to
          visit and inspect the financial records and the properties of the
          Company at reasonable times, upon reasonable notice and as often as
          reasonably requested and to make extracts from and copies of such
          financial records, and permit any Persons designated by the
          Administrative Agent (or, during the continuance of any Termination
          Event, any Bank) to discuss the affairs, finances and condition of
          the Company with the officers thereof and independent accountants
          therefor (subject to reasonable requirements of confidentiality,
          including requirements imposed by law or by contract).

                    7.6  Notices.  Promptly give notice to the Administrative
          Agent and each Bank of:

                    (a)  the occurrence of any Termination Event, Potential
               Termination Event, Servicer Default or Servicer Event of
               Default, specifying the nature and extent thereof and the
               corrective action (if any) proposed to be taken with respect
               thereto;

                    (b)  any Lien not permitted by subsection 8.3 on any
               Receivable or any other Pooled Property other than the
               conveyances and Liens hereunder and under the Receivables Sale
               Agreement;

                    (c)  the filing or commencement of any action, suit or
               proceeding, whether at law or in equity or by or before any
               Governmental Authority, against the Company in respect of
               which there is a reasonable possibility of an adverse
               determination and which, if adversely determined, could
               reasonably be expected to result in a Material Adverse Effect;
               and

                    (d)  any development known to a Responsible Officer of
               the Company that has resulted in, or could reasonably be
               anticipated to result in, a Material Adverse Effect.


<PAGE>

                                                                     31



                    7.7  ERISA.  (a)  Comply in all material respects with
          the applicable provisions of ERISA and (b) furnish to the
          Administrative Agent and each Bank (i) as soon as possible, and in
          any event within 30 days after any Responsible Officer of the
          Company or any ERISA Affiliate of any of them knows or has reason
          to know that any Reportable Event has occurred that alone or
          together with any other Reportable Event could reasonably be
          expected to result in liability of the Company or any of its ERISA
          Affiliates to the PBGC in an aggregate amount exceeding
          $10,000,000, a statement of a Responsible Officer of the Company
          setting forth details as to such Reportable Event and the action
          proposed to be taken with respect thereto, together with a copy of
          the notice, if any, of such Reportable Event given to the PBGC,
          (ii) promptly after any Responsible Officer of the Company learns
          of receipt thereof, a copy of any notice the Company or any of its
          ERISA Affiliates may receive from the PBGC relating to the
          intention of the PBGC to terminate any Plan or Plans (other than a
          Plan maintained by any of their ERISA Affiliates which is
          considered an ERISA Affiliate only pursuant to subsection (m) or
          (o) of Section 414 of the Code) or to appoint a trustee to
          administer any Plan or Plans, (iii) within 20 days after the due
          date for filing with the PBGC pursuant to Section 412(n) of the
          Code a notice of failure to make a required installment or other
          payment with respect to a Plan, a statement of a Responsible
          Officer of the Company setting forth details as to such failure and
          the action proposed to be taken with respect thereto, together with
          a copy of such notice given to the PBGC and (iv) promptly after any
          Responsible Officer of the Company learns thereof and in any event
          within 30 days after receipt thereof by the Company or any ERISA
          Affiliate from the sponsor of a Multiemployer Plan, a copy of each
          notice received by the Company or such ERISA Affiliate concerning
          (A) the imposition of Withdrawal Liability or (B) a determination
          that a Multiemployer Plan is, or is expected to be, terminated or
          in reorganization, in each case within the meaning of Title IV of
          ERISA.


                    7.8  Use of Proceeds.  The Company shall use the proceeds
          of the initial transfer and assignment of the Participating
          Interest only to acquire all the Receivables owned by the Sellers
          on the date of such transfer and assignment and to pay fees and
          expenses pursuant to the Transaction Documents.  The Company shall
          use the proceeds of any Increases in Net Investment (a) to acquire
          Receivables from the Sellers pursuant to the Receivables Sale
          Agreement in an amount not to exceed the aggregate amount specified
          in the applicable Daily Report, (b) to pay operating expenses of
          the Company, (c) to make payments on account of the Subordinated
          Notes in the aggregate amount specified in the applicable Daily
          Report, and (d) to make payments on account of Restricted Payments
          in the aggregate amount specified in the applicable Daily Report.

                    7.9  Separate Corporate Existence.  The Company shall
          take, or refrain from taking, as the case may be, all actions that
          are necessary to be taken or not taken in order to (a) ensure that
          the assumptions and factual recitations set forth in the Specified
          Bankruptcy Opinion Provisions remain true and correct with respect
          to the Company and (b) comply with those procedures described in
          such provisions which are applicable to the Company.

                    7.10  Facility Rating.  Promptly upon request of the
          Administrative Agent, at the expense of the Company, cause the
          receivables purchase facility created by this Agreement to be rated
          by S&P or another nationally recognized rating agency designated by
          the Administrative Agent.


<PAGE>


                                                                       32



                    7.11  Lockbox Agreements.  Within 60 days after the
          Effective Date, deliver to the Administrative Agent one or more
          confirmations that the Lockbox Accounts, in the name of the
          Company, have been established in accordance with the terms of this
          Agreement and deliver to the Administrative Agent an executed
          Lockbox Agreement from each of the Lockbox Banks.

                    7.12  Eligible Letters of Credit.  (a)  Submit to the
          relevant issuing bank all documentation necessary to effect a
          drawing under any Eligible Letter of Credit immediately upon the
          occurrence of any event entitling the Company to receive any
          payment thereunder and (b) cause such payment to be deposited
          directly into the U.S. Concentration Account.

                    7.13  Company Policies.  Amend, supplement or otherwise
          modify in any material respect (or permit to be amended,
          supplemented or otherwise modified in any material respect) the
          Company Policies or vary (or permit to be varied) the
          implementation of the Company Policies other than (a) with the
          consent of the Required Banks and (b) changes that are required by
          applicable law; provided, that material changes to the Company
          Policies shall include, without limitation, changes to the timing
          of Charge-Offs of Receivables.


                                      ARTICLE VIII

                                   Negative Covenants

                    The Company hereby agrees that, unless and until this
          Agreement is terminated pursuant to subsection 4.1, the Company
          shall not directly or indirectly:

                    8.1  Accounting of Transfers.  Prepare any financial
          statements which shall account for the transactions contemplated
          hereby (other than capital contributions contemplated hereby) in
          any manner other than as sales of participating interests in the
          Purchased Receivables by the Company to the Banks or in any other
          respect account for or treat the transactions contemplated hereby
          (including for financial accounting purposes, except as required by
          law) (other than capital contributions and loans from Affiliates
          contemplated hereby) in any manner other than as assignments and
          transfers of participating interests in the Purchased Receivables
          by the Company to the Banks, provided however that this subsection
          8.1 shall not apply for any tax or tax accounting purposes.

                    8.2  Limitation on Indebtedness.  Create, incur, assume
          or suffer to exist any Indebtedness, except:  (a) Indebtedness
          evidenced by the Subordinated Notes; (b) Indebtedness representing
          fees, expenses and indemnities payable pursuant to and in
          accordance with the Transaction Documents; and (c) Indebtedness for
          services supplied or furnished to the Company in an amount not to
          exceed $50,000 at any time outstanding.

                    8.3  Limitation on Liens.  Create, incur, assume or
          suffer to exist any Lien upon any of its property, assets or
          revenues, whether now owned or hereafter acquired, except for (a)
          Liens created pursuant to this Agreement and (b) Liens for taxes
          not yet due or which are being contested in good faith by
          appropriate proceedings provided that adequate reserves with
          respect thereto are maintained on the books of the Company in
          conformity with GAAP.



<PAGE>

                                                                        33




                    8.4  Limitation on Guarantees.  Create, incur, assume or
          suffer to exist any obligation constituting a Guarantee.

                    8.5  Limitation on Fundamental Changes.  Enter into any
          merger, consolidation or amalgamation, or liquidate, wind up or
          dissolve itself (or suffer any liquidation or dissolution), or
          convey, sell, lease, assign, transfer or otherwise dispose of, all
          or substantially all of its property, business or assets, or make
          any material change in its present method of conducting business,
          other than the assignments and transfers to the Banks contemplated
          hereby.

                    8.6  Limitation on Sale of Assets.  Convey, sell, lease,
          assign, transfer or otherwise dispose of any of its property,
          business or assets (including, without limitation, receivables and
          leasehold interests), whether now owned or hereafter acquired,
          other than (a) the assignments and transfers contemplated hereby
          and (b) sales or other dispositions of property with an aggregate
          book value not exceeding $10,000 in any period of twelve
          consecutive fiscal months.

                    8.7  Limitation on Dividends and Payments on Subordinated
          Notes.  Declare or pay any dividend on, or make any payment on
          account of, or set apart assets for a sinking or other analogous
          fund for, the purchase, redemption, defeasance, retirement or other
          acquisition of, any shares of any class of Capital Stock of the
          Company, whether now or hereafter outstanding, or make any other
          distribution in respect thereof, either directly or indirectly,
          whether in cash or property or in obligations of the Company (such
          declarations, payments, setting apart, purchases, redemptions,
          defeasances, retirements, acquisitions and distributions being
          herein called "Restricted Payments"), or make, directly or
          indirectly, payments in any form in respect of the Subordinated
          Notes except that, so long as no Termination Event or Potential
          Termination Event shall have occurred and be continuing or would
          result therefrom, the Company may (a) make payments on the
          Subordinated Notes and (b) make Restricted Payments, each pursuant
          to subsection 2.7.

                    8.8  Business of the Company.  Engage at any time in any
          business or business activity other than the acquisition of
          Receivables pursuant to the Receivables Sale Agreement, the
          assignments and transfers hereunder and the other transactions
          contemplated by the Transaction Documents, and any activity
          incidental to the foregoing and necessary or convenient to
          accomplish the foregoing, or enter into or be a party to any
          agreement or instrument other than in connection with the
          foregoing, except those agreements or instruments set forth on
          Schedule 5.

                    8.9  Limitation on Investments, Loans and Advances.  Make
          any advance, loan, extension of credit or capital contribution to,
          or purchase any stock, bonds, notes, debentures or other securities
          of or any assets constituting a business unit of, or make any other
          investment in, any Person, except for the Receivables and the other
          Pooled Property.

                    8.10  Limitation on Sales and Leasebacks.  Enter into any
          arrangement with any Person providing for the leasing by the
          Company of real or personal property which has been or is to be
          sold or transferred by the Company to such Person or to any other
          Person to whom funds have been or are to be advanced by such Person
          on the security of such property or rental obligations of the
          Company.


<PAGE>


                                                                          34



                    8.11  Transactions with Affiliates.  Sell or transfer any
          property or assets to, or purchase or acquire any property or
          assets from, or otherwise engage in any other transactions with,
          any of its Affiliates except (a) as expressly contemplated by the
          Transaction Documents; (b) as disclosed on Schedule 4; or (c) with
          the unanimous approval or ratification of the Board of Directors of
          the Company upon fair and reasonable terms no less favorable to the
          Company than it could reasonably expect to obtain in a comparable
          arm's length transaction with a Person which is not an Affiliate.

                    8.12  Capital Stock.  Issue any Capital Stock to any
          Person or permit any of its Capital Stock to be transferred to any
          Person, except pursuant to the Pledge Agreement.

                    8.13  Amendments.  Amend (or permit to be amended) its
          Certificate of Incorporation.

                    8.14  Receivables Sale Agreement, etc.  Amend, supplement
          or otherwise modify (or permit to be amended, supplemented or
          otherwise modified) the Receivables Sale Agreement or any of the
          other Transaction Documents or give any consent or waiver to any
          Seller thereunder, provided that, with respect to any Lockbox
          Agreement, the Company shall be permitted to amend, supplement or
          otherwise modify any such Lockbox Agreement so long as (a) such
          amendment, supplement or modification could not be reasonably
          expected to have a Material Adverse Effect and (b) the
          Administrative Agent shall have received a substantially final
          draft of such amendment, supplement or modification at least five
          Business Days prior to the effective date thereof.

                    8.15  Policies.  Amend, supplement or otherwise modify in
          any material respect (or permit to be amended, supplemented or
          otherwise modified in any material respect) the Policies or the
          Company Policies or vary the implementation of the Policies or the
          Company Policies other than (a) with the consent of the Required
          Banks and (b) changes that are required by applicable law;
          provided, that material changes to the Policies and the Company
          Policies shall include, without limitation, changes to the timing
          of Charge-Offs of Receivables and changes to the creditworthiness
          criteria used in determining whether to extend credit to a Person
          and in determining the amount of such credit to extend.

                    8.16  No Powers of Attorney.  Grant any powers of
          attorney to any Person for any purposes except (a) for the purpose
          of permitting any Person to perform any ministerial functions on
          behalf of the Company that are not prohibited by or inconsistent
          with the terms of the Transaction Documents; (b) to the
          Administrative Agent in connection herewith; or (c) as expressly
          permitted by the Transaction Documents.

                    8.17  Receivables Not To Be Evidenced by Promissory
          Notes.  Take any action to cause any Receivable to be evidenced by
          any "instrument" (as defined in the Uniform Commercial Code (or any
          similar law) as in effect in any state in which the Company's or
          any Seller's chief executive offices or books and records relating
          to such Receivable are located) other than as expressly
          contemplated by the Policies.

                    8.18  Ownership of Assets and Property.  Own or lease any
          material tangible assets other than as expressly contemplated
          pursuant to the terms of this Agreement and the 


<PAGE>

                                                                         35



          other Transaction Documents, or own or lease any facilities or 
          incur, create, assume or permit to exist any lease obligations other 
          than arms' length lease obligations to Affiliates or third parties 
          in respect of office space, equipment and computer time.

                    8.19  Rescission or Cancellation.  Rescind or cancel any
          Receivable or modify or extend any term or provision of any thereof
          without the prior written consent of the Required Banks, except (a)
          in the ordinary course of its business and consistent with the
          Policies and the Company Policies or (b) as required by any
          Requirement of Law, provided that the Company may cause Receivables
          to become Charge-Offs and may allow Sellers to make Adjustments in
          accordance with subsection 2.5 of the Receivables Sale Agreement.

                    8.20  Ineligible Receivables.  Without the prior written
          approval of the Required Banks, take any action to cause, or which
          would permit, an Eligible Receivable to cease to be an Eligible
          Receivable, except as otherwise expressly provided for in this
          Agreement.

                    8.21  Offices.  (a)  Move outside the state where such
          office is now located the location of its chief executive office or
          of any of the offices where it keeps its records with respect to
          the Receivables without (i) 30 days' prior written notice to the
          Administrative Agent and (ii) taking all actions reasonably
          requested by the Administrative Agent (including but not limited to
          all filings and other acts necessary or advisable under the Uniform
          Commercial Code of each relevant jurisdiction) in order to continue
          the Banks' first priority perfected ownership interest in all
          Receivables now owned or hereafter created or (b) fail to give the
          Administrative Agent prompt notice of a change within the state
          where such office is now located of the location of its chief
          executive office or any office where it keeps its records with
          respect to the Receivables.

                    8.22  Addition of Sellers.  Agree to the addition of any
          Subsidiary as an additional Seller pursuant to subsection 9.14 of
          the Receivables Sale Agreement unless (a) the Required Banks have
          approved such addition in writing and (b) such Subsidiary shall
          have been simultaneously added as a Servicer party hereto pursuant
          to subsection 12.9 hereof.

                    8.23  Optional Termination of Seller.  Designate any
          Seller as a Seller to be terminated as a Seller pursuant to
          subsection 9.15(b) of the Receivables Sale Agreement unless (a) the
          Required Banks have approved such designation in writing and (b) if
          such Seller is a Servicer hereunder, such Seller shall have been
          terminated as a Servicer pursuant to subsection 12.10 hereof.

                    8.24  Operating Expenses.  Incur or otherwise become
          liable for operating expenses other than expenses for office space,
          equipment, personnel, office supplies, computer time, services of
          third party professionals and other reasonable overhead expenses.


<PAGE>



                                                                           36



                                       ARTICLE IX

                                 Events of Termination

                    If any of the following events (herein called
          "Termination Events") shall have occurred and be continuing:

                    (a)  the Company shall fail to deliver any Daily Report
               or any Settlement Statement conforming in all material
               respects to the requirements of subsection 12.5 and such
               failure shall continue for two consecutive Business Days after
               the Administrative Agent shall have delivered notice thereof
               to the Company, provided that if a Force Majeure Delay shall
               have occurred with respect to any Servicer or the Master
               Servicer, as the case may be, (i) in the case of such an event
               with respect to a Servicer, the failure of any Daily Report or
               Settlement Statement to contain information with respect to
               the Receivables serviced by such Servicer or (ii) in the case
               of such an event with respect to the Master Servicer, the
               failure of the Company to deliver any Daily Report or
               Settlement Statement, shall not, in either case, constitute a
               Termination Event unless such failure continues for longer
               than the lesser of (x) ten consecutive Business Days and (y)
               the length of such Force Majeure Delay (or, if greater, two
               Business Days) after the Administrative Agent shall have
               delivered notice of such failure to the Company;

                    (b)  the Company shall fail to pay, or the Banks or the
               Administrative Agent shall not be paid, any amount (i)
               required to be paid hereunder in respect of reduction of the
               Net Investment when due or (ii) required to be paid in respect
               of Purchase Discount Amounts, any other amounts payable to the
               Banks or Administrative Agent or any payment reflected in any
               Daily Report or Settlement Statement as being required to be
               made by the Company, in any case, with respect to this clause
               (ii), within five Business Days after the date when due;

                    (c)  default shall be made in the due observance or
               performance by the Company of any covenant, condition or
               agreement contained in subsection 7.3(a), 7.6(a) or 7.8 or in
               Article VIII;

                    (d)  the Company shall fail to observe or perform any
               covenant or agreement applicable to it contained herein (other
               than as specified in paragraph (a), (b) or (c) of this Article
               IX), provided that no such failure shall constitute a
               Termination Event under this paragraph (d) unless such failure
               shall continue unremedied for a period of 30 consecutive days
               in the case of subsection 7.3(b) or 7.3(c) and 15 consecutive
               days in the case of all others, in each case after notice
               thereof from the Administrative Agent or the Required Banks to
               the Company;

                    (e)  any representation, warranty, certification or
               statement made or deemed made by the Company in this Agreement
               or in any Settlement Statement or other certificate, financial
               statement or other document delivered pursuant to this
               Agreement shall prove to have been false or misleading in any
               material respect on or as of the date made or deemed made;
               provided that a Termination Event shall not be deemed to have
               occurred under this paragraph (e) based upon a breach of a
               representation or warranty contained in 


<PAGE>

                                                                         37




               subsection 5.2(d), (e), (f) or (h) if the Company shall have 
               complied with the provisions of subsection 5.3(b) in respect 
               thereof; 

                    (f)  (i) an involuntary proceeding shall be commenced or
               an involuntary petition shall be filed in a court of competent
               jurisdiction seeking (A) relief in respect of the Company, or
               of a substantial part of its property or assets, under Title
               11 of the United States Code, as now constituted or hereafter
               amended, or any other Federal or state bankruptcy, insolvency,
               receivership or similar law, (B) the appointment of a
               receiver, trustee, custodian, sequestrator, conservator or
               similar official for the Company or for a substantial part of
               its property or assets or (C) the winding-up or liquidation of
               the Company; and such proceeding or petition shall continue
               undismissed for 60 days or an order or decree approving or
               ordering any of the foregoing shall be entered; or (ii) the
               Company shall (A) voluntarily commence any proceeding or file
               any petition seeking relief under Title 11 of the United
               States Code, as now constituted or hereafter amended, or any
               other Federal or state bankruptcy, insolvency, receivership or
               similar law, (B) consent to the institution of, or fail to
               contest in a timely and appropriate manner, any proceeding or
               the filing of any petition described in clause (i) above, (C)
               apply for or consent to the appointment of a receiver,
               trustee, custodian, sequestrator, conservator or similar
               official for the Company or for a substantial part of its
               property or assets, (D) file an answer admitting the material
               allegations of a petition filed against it in any such
               proceeding, (E) make a general assignment for the benefit of
               creditors, (F) become unable, admit in writing its inability
               or fail generally to pay its debts as they become due or (G)
               take any action for the purpose of effecting any of the
               foregoing;

                    (g)  Holdings or any Restricted Subsidiary or any
               Significant Subsidiary (as each such term is defined in the
               Credit Agreement as in effect on the Effective Date) shall (i)
               fail to pay any principal or interest, regardless of amount,
               due in respect of Indebtedness having an aggregate principal
               or notional amount in excess of $7,500,000, when and as the
               same shall become due and payable, or (ii) fail to observe or
               perform any other term, covenant, condition or agreement
               contained in any agreements or instruments evidencing or
               governing any Indebtedness having an aggregate principal
               amount in excess of $7,500,000 if the effect of any failure
               referred to in this clause (ii) is to cause, or to permit the
               holder or holders of such Indebtedness or a trustee on its or
               their behalf to cause, such Indebtedness to become due prior
               to its stated maturity;

                    (h)  (i)  a Reportable Event or Reportable Events, or a
               failure to make a required installment or other payment
               (within the meaning of Section 412(n)(1) of the Code), shall
               have occurred with respect to any Plan or Plans that
               reasonably could be expected to result in liability of the
               Company or any of its ERISA Affiliates to the PBGC or to a
               Plan in an aggregate amount exceeding $5,000,000 and, within
               30 days after the reporting of any such Reportable Event to
               the Administrative Agent or after the receipt by the
               Administrative Agent of the statement required pursuant to
               Section 7.7(b)(iii), the Administrative Agent shall have
               notified the Company in writing that (x) the Required Banks
               have made a determination that, on the basis of such
               Reportable Event or Reportable Events or the failure to make a
               required payment, there are reasonable grounds (A) for the
               termination of such Plan or Plans by the PBGC, (B) for the
               appointment by the appropriate United States District Court of
               a trustee to administer 


<PAGE>

                                                                        38




               such Plan or Plans or (C) for the imposition of a lien in favor 
               of a Plan and (y) as a result thereof a Termination Event exists
               hereunder; or a trustee shall be appointed by a United States 
               District Court to administer any such Plan or Plans; or the 
               PBGC shall institute proceedings to terminate any Plan or 
               Plans; or (ii) (x) the Company or any of its ERISA Affiliates 
               shall have been notified by the sponsor of a Multiemployer Plan 
               that it has incurred Withdrawal Liability to such Multiemployer 
               Plan, (y) the Company or such ERISA Affiliate does not have 
               reasonable grounds for contesting such Withdrawal Liability or 
               is not in fact contesting such Withdrawal Liability in a timely 
               and appropriate manner and (z) the amount of the Withdrawal
               Liability specified in such notice, when aggregated with all
               other amounts required to be paid to Multiemployer Plans in
               connection with Withdrawal Liabilities (determined as of the
               date or dates of such notification), exceeds $7,500,000 or
               requires payments exceeding $7,500,000 in any year; or (iii)
               the Company or any of its ERISA Affiliates shall have been
               notified by the sponsor of a Multiemployer Plan that such
               Multiemployer Plan is in reorganization or is being
               terminated, within the meaning of Title IV of ERISA, if solely
               as a result of such reorganization or termination the
               aggregate annual contributions of the Company and its ERISA
               Affiliates to all Multiemployer Plans that are then in
               reorganization or have been or are being terminated have been
               or will be increased over the amounts required to be
               contributed to such Multiemployer Plans for their most
               recently completed plan years by an amount exceeding
               $7,500,000;

                    (i)  there shall have occurred a Change in Control;

                    (j)  (i)  one or more judgments for the payment of money
               in an aggregate amount in excess of $250,000 (to the extent
               not covered by insurance) shall be rendered against the
               Company and the same shall remain undischarged or stayed for a
               period of 30 consecutive days during which execution shall not
               be effectively stayed, or any action shall be legally taken by
               a judgment creditor to levy upon assets or properties of the
               Company to enforce any such judgment or (ii) one or more
               judgments for the payment of money in an aggregate amount in
               excess of $7,500,000 (to the extent not covered by insurance)
               shall be rendered against Holdings or any Restricted
               Subsidiary or any Significant Subsidiary (as each such term is
               defined in the Credit Agreement as in effect on the Effective
               Date) or any combination thereof and the same shall remain
               undischarged or stayed for a period of 30 consecutive days
               during which execution shall not be effectively stayed, or any
               action shall be legally taken by a judgment creditor to levy
               upon assets or properties of Holdings or any Restricted
               Subsidiary to enforce any such judgment;

                    (k)  any material provision of the Transaction Documents
               shall not be in full force and effect, enforceable in
               accordance with its terms, or the Company, a Seller, a
               Servicer or the Master Servicer, or any Affiliate of any of
               the foregoing, shall so assert in writing;

                    (l)  the Participating Interest shall for any reason
               cease to be a valid and perfected first priority undivided
               participating interest in the Receivables;

                    (m)  the Company shall have become an "investment
               company" under the Investment Company Act of 1940;


<PAGE>


                                                                        39



                    (n)  a Purchase Termination Event shall have occurred and
               be continuing under the Receivables Sale Agreement;

                    (o)  the Company shall fail to pay the Purchase Price for
               any newly created Receivable when due pursuant to subsection
               2.3 of the Receivables Sale Agreement (including, without
               limitation, by application of any restrictions in such
               subsection); provided that no such failure shall constitute a
               Termination Event under this paragraph (o) unless such failure
               shall continue for five consecutive Business Days;

                    (p)  a Servicer Event of Default shall have occurred and
               be continuing;

                    (q)  at the end of any fiscal month, the Loss to
               Liquidation Ratio exceeds 5%;

                    (r)  the ratio (expressed as a percentage) of (i) the
               aggregate Adjusted Principal Amount of all Receivables that
               are more than 60 days past due at the end of any fiscal month
               (and are not Defaulted Receivables) to (ii) the aggregate
               Adjusted Principal Amount of all Receivables (which are not
               Defaulted Receivables) at the end of such fiscal month exceeds
               10%;


                    (s)  at the end of any fiscal month, Days Sales
               Outstanding with respect to such fiscal month exceeds 75 days;
               or

                    (t)  the Net Investment exceeds the Maximum Transfer
               Amount on the second Business Day following any Settlement
               Date, after giving effect to the calculation of the Required
               Reserve Percentage on such Settlement Date, and after
               application of Collections and all other payments and amounts
               to reduce the Net Investment to and including such second
               Business Day (except to the extent Excess Application Amounts
               in respect of such excess are being held in a cash collateral
               account pursuant to subsection 2.12(c)); 

          then, (x) if such event is (I) a Termination Event described in
          paragraph (f) above or (II) a Termination Event described in
          paragraph (n) above resulting from a Purchase Termination Event
          described in paragraph (f) of Article VII of the Receivables Sale
          Agreement, automatically the Commitment Period shall thereupon
          terminate without notice of any kind, which is hereby waived by the
          Company and (y) if such event is any other Termination Event, so
          long as such Termination Event shall be continuing, with the
          consent of the Required Banks the Administrative Agent may, or upon
          the request of the Required Banks the Administrative Agent shall,
          by notice to the Company terminate the Commitment Period.


                                       ARTICLE X

                                The Administrative Agent

                    10.1  Appointment.  Each Bank hereby irrevocably
          designates and appoints the Administrative Agent as the agent of
          such Bank under this Agreement and each Bank irrevocably authorizes
          the Administrative Agent, as the agent for such Bank, to take 
          such action 


<PAGE>

                                                                       40


          on its behalf under the provisions of this Agreement and to
          exercise such powers and perform such duties as are expressly
          delegated to the Administrative Agent by the terms of this
          Agreement, together with such other powers as are reasonably
          incidental thereto, including, but not limited to, the signing by
          the Administrative Agent, as agent for the Banks, of any financing
          statements related to the Receivables.   Notwithstanding any
          provision to the contrary elsewhere in this Agreement, the
          Administrative Agent shall not have any duties or responsibilities,
          except those expressly set forth herein, or any fiduciary
          relationship with any Bank, the Company, any Servicer or the Master
          Servicer, and no implied covenants, functions, responsibilities,
          duties, obligations or liabilities shall be read into this
          Agreement or otherwise exist against the Administrative Agent. 
          Each Bank acknowledges and consents to Chemical Bank's acting as
          administrative agent for the lenders under the Credit Agreement and
          the documents delivered pursuant thereto.

                    10.2  Delegation of Duties.  The Administrative Agent may
          execute any of its duties under this Agreement by or through agents
          or attorneys-in-fact and shall be entitled to advice of counsel
          concerning all matters pertaining to such duties.  The
          Administrative Agent shall not be responsible for the negligence or
          misconduct of any agents or attorneys in-fact selected by it with
          reasonable care.

                    10.3   Exculpatory Provisions.  Neither the
          Administrative Agent nor any of its officers, directors, employees,
          agents, attorneys-in-fact or affiliates shall be (i) liable for any
          action lawfully taken or omitted to be taken by it or such Person
          under or in connection with this Agreement or the transactions
          contemplated hereby or thereby (except for its or such Person's own
          gross negligence or willful misconduct), (ii) responsible in any
          manner to any party hereto for any recitals, statements,
          representations or warranties made by the Company, any Servicer,
          the Master Servicer or any of the Banks or any officer thereof
          contained in this Agreement, or in any certificate, report,
          statement or other document referred to or provided for in, or
          received by the Administrative Agent under or in connection with
          this Agreement or the transactions contemplated hereby or thereby
          or for the value, validity, effectiveness, genuineness,
          enforceability or sufficiency of this Agreement or (iii) for any
          failure of the Company, any Servicer, the Master Servicer, or any
          of the Banks to perform their respective obligations hereunder. 
          The Administrative Agent shall not be under any obligation to any
          party hereto to ascertain or to inquire as to the observance or
          performance of any of the agreements contained in, or conditions
          of, this Agreement or to inspect the properties, books or records
          of the Company, any Servicer, the Master Servicer or any of the
          Banks.

                    10.4  Reliance by the Administrative Agent.  The
          Administrative Agent shall be entitled to rely, and shall be fully
          protected in relying, upon any writing, resolution, notice,
          consent, certificate, affidavit, letter, telecopy, telex or
          teletype message, statement, order or other document or
          conversation believed by it to be genuine and correct and to have
          been signed, sent or made by the proper Person or Persons and upon
          advice and statements of legal counsel (including, without
          limitation, counsel to any of the Banks and counsel to the Company,
          any Servicer or the Master Servicer), independent accountants and
          other experts selected by the Administrative Agent, as the case may
          be.  The Administrative Agent shall be fully justified in failing
          or refusing to take any action under this Agreement unless it shall
          first receive such advice or concurrence of the Banks as it deems
          appropriate or it shall first be indemnified to its satisfaction by
          the Banks against any and all liability and expense which may be
          incurred by it 


<PAGE>

                                                                       41



          by reason of taking or continuing to take any such
          action.  The Administrative Agent shall in all cases be fully
          protected in acting, or in refraining from acting, under this
          Agreement in accordance with a request of the Banks entitled to
          give such a request hereunder, and such request and any action
          taken or failure to act pursuant thereto shall be binding upon all
          the Banks.



                    10.5  Notice of Default or Termination Event.  The
          Administrative Agent shall not be deemed to have knowledge or
          notice of the occurrence of any default or Termination Event
          hereunder unless the Administrative Agent has received notice from
          a Bank, the Company, any Servicer or the Master Servicer referring
          to this Agreement, describing such default or Termination Event and
          stating that such notice is a "notice of default" or a "notice of
          Termination Event", as the case may be.  In the event that the
          Administrative Agent receives such a notice, the Administrative
          Agent shall give promptly notice thereof to the Banks and to the
          Company.  The Administrative Agent shall take such action with
          respect to such default or Termination Event as shall be reasonably
          directed by the Required Banks, provided that unless and until the
          Administrative Agent shall have received such directions, the
          Administrative Agent may (but shall not be obligated to) take such
          action, or refrain from taking such action, with respect to such
          default or Termination Event as it shall deem advisable in the best
          interests of the Banks.

                    10.6  Non-Reliance on the Administrative Agent and Other
          Banks.  Each Bank hereby expressly acknowledges that neither the
          Administrative Agent nor any of its officers, directors, employees,
          agents, attorneys-in-fact or affiliates has made any
          representations or warranties to it and that no act by the
          Administrative Agent hereinafter taken, including any review of the
          affairs of the Company, any Servicer or the Master Servicer, shall
          be deemed to constitute any representation or warranty by the
          Administrative Agent to any Bank.  Each Bank hereby represents to
          the Administrative Agent that it has, independently and without
          reliance upon the Administrative Agent or any other Bank, and based
          on such documents and information as it has deemed appropriate,
          made its own appraisal of and investigation into the business,
          operations, property and financial and other condition and
          creditworthiness of the Company, the Servicers and the Master
          Servicer and made its own decision to acquire a Participating
          Interest hereunder and enter into this Agreement.  Each Bank hereby
          also represents that it will, independently and without reliance
          upon the Administrative Agent or any other Bank, and based on such
          documents and information as it shall deem appropriate at the time,
          continue to make its own appraisals and decisions in taking or not
          taking action under this Agreement, and to make such investigation
          as it deems necessary to inform itself as to the business,
          operations, property and financial and other condition and
          creditworthiness of the Company, the Servicers and the Master
          Servicer.  Except for notices, reports and other documents
          expressly required to be furnished to the Banks by the
          Administrative Agent hereunder, the Administrative Agent shall not
          have any duty or responsibility to provide any Bank with any
          information concerning the business, operations, property,
          condition (financial or otherwise), prospects or creditworthiness
          of the Company, any Servicer or the Master Servicer which may come
          into the possession of the Administrative Agent or any of its
          officers, directors, employees, agents, attorneys-in-fact or
          affiliates.



                    10.7  Indemnification.  Each Bank hereby agrees to
          indemnify the Administrative Agent in its capacity as such (to the
          extent not reimbursed by the Company and without limiting 


<PAGE>

                                                                       42



          the obligation of the Company to do so), ratably according to their
          respective Commitment Percentages in effect on the date on which
          indemnification is sought under this subsection 10.7, from and
          against any and all Indemnified Liabilities which may at any time
          (including without limitation at any time following the termination
          of the commitment of the Banks to increase their Participating
          Interest hereunder) be imposed on, incurred by or asserted against
          the Administrative Agent in any way relating to or arising out of
          this Agreement, or any documents contemplated by or referred to
          herein or the transactions contemplated hereby or any action taken
          or omitted by the Administrative Agent under or in connection with
          any of the foregoing, provided that no Bank shall be liable for the
          payment of any portion of such Indemnified Liabilities resulting
          from the Administrative Agent's gross negligence or willful
          misconduct.  The agreements in this subsection 10.7 shall survive
          the termination of the commitments of the Banks to acquire a
          Participating Interest hereunder, the collection of all
          Receivables, the termination of this Agreement and the payment of
          all amounts payable hereunder.

                    10.8  The Administrative Agent in Its Individual
          Capacity.  The Administrative Agent and its affiliates may make
          loans to, accept deposits from and generally engage in any kind of
          business with the Company, the Servicers, the Master Servicer or
          any of their affiliates as though the Administrative Agent were not
          the Administrative Agent.  With respect to any Participating
          Interests purchased or maintained by it under this Agreement, the
          Administrative Agent shall have the same rights and powers
          hereunder as any Bank and may exercise the same as though it were
          not the Administrative Agent, and the term "Bank" shall include the
          Administrative Agent in its individual capacity.

                    10.9  Successor Administrative Agent.  Subject to the
          appointment and acceptance of a successor Administrative Agent as
          provided below, the Administrative Agent may resign at any time by
          notifying the Banks and the Company.  Upon any such resignation,
          the Required Banks shall have the right to appoint a successor,
          with the consent of the Company (not to be unreasonably withheld). 
          If no successor shall have been so appointed by the Required Banks
          and shall have accepted such appointment within 30 days after the
          retiring Administrative Agent gives notice of its resignation, then
          the retiring Administrative Agent may, on behalf of the Banks,
          appoint a successor Administrative Agent, with the consent of the
          Company (not to be unreasonably withheld), which shall be a bank
          with an office in New York, New York, having a combined capital and
          surplus of at least $500,000,000 or an Affiliate of any such bank
          which is also a bank.  Upon the acceptance of any appointment as
          Administrative Agent hereunder by a successor bank, such successor
          shall succeed to and become vested with all the rights, powers,
          privileges and duties of the retiring Administrative Agent and the
          retiring Administrative Agent shall be discharged from its duties
          and obligations hereunder.  After the Administrative Agent's
          resignation hereunder, the provisions of this Article X and of
          subsection 11.3 shall continue in effect for its benefit in respect
          of any actions taken or omitted to be taken by it while it was
          acting as Administrative Agent.


                                       ARTICLE XI

                                     Miscellaneous



<PAGE>

                                                                        43



                    11.1  Further Assurances.  Each of the Company, the
          Servicers and the Master Servicer agrees, from time to time, to do
          and perform any and all acts and to execute any and all further
          instruments reasonably required or requested by the Administrative
          Agent at the request of any Bank more fully to effect the purposes
          of this Agreement and the assignments and transfers of the
          Participating Interest hereunder, including, without limitation,
          the execution of any financing statements or continuation
          statements relating to the Receivables for filing under the
          provisions of the Uniform Commercial Code, or any similar law, of
          any applicable jurisdiction.

                    11.2  Payments.  Each payment to be made by any of the
          Banks, the Company, any of the Servicers or the Master Servicer
          hereunder shall be made on the required payment date in Dollars and
          in immediately available funds at the office of the Administrative
          Agent located at 270 Park Avenue, New York, New York 10017 or to
          such other office as may be specified by the Administrative Agent
          in a notice to the Company, the Servicers, the Master Servicer and
          the Banks.

                    11.3  Costs and Expenses.  (a)  The Company agrees to pay
          all reasonable out-of-pocket expenses incurred by the
          Administrative Agent in connection with the preparation of this
          Agreement and the other Transaction Documents, or by the
          Administrative Agent in connection with the syndication of the
          Commitments or the administration of this Agreement, or in
          connection with any amendments, modifications or waivers of the
          provisions hereof or thereof (whether or not the transactions
          hereby contemplated shall be consummated) or incurred by the
          Administrative Agent or any Bank in connection with the enforcement
          or protection of their rights in connection with this Agreement and
          the other Transaction Documents or in connection with the purchases
          made hereunder, including the reasonable fees, charges and
          disbursements of Simpson Thacher & Bartlett, counsel for the
          Administrative Agent, and, in connection with any such enforcement
          or protection, the reasonable fees, charges and disbursements of
          any other counsel (including the reasonable allocated costs of
          internal counsel if a Bank elects to use internal counsel in lieu
          of outside counsel) for the Administrative Agent or any Bank (but
          no more than one such counsel for any Bank).

                    (b)  The Company agrees to indemnify the Administrative
          Agent, each Bank and each of their respective directors, officers,
          employees and agents (each such Person being called an
          "Indemnitee") against, and to hold each Indemnitee harmless from,
          any and all losses, claims, damages, liabilities and related
          expenses, including reasonable counsel fees, charges and
          disbursements, incurred by or asserted against any Indemnitee
          arising out of, in any way connected with, or as a result of (i)
          the execution or delivery of this Agreement or any other
          Transaction Document or any agreement or instrument contemplated
          thereby, the performance by the parties thereto of their respective
          obligations thereunder or the consummation of the Transactions and
          the other transactions contemplated thereby, (ii) the use of the
          proceeds of the initial transfer and assignment of the
          Participating Interest and of any Increases in Net Investment,
          (iii) any and all Canadian withholding taxes which may be imposed
          in respect of the Receivables or in connection with the
          Transactions (without duplication of any amounts in respect of such
          taxes payable pursuant to subsection 3.3 or 3.5), or (iv) any
          claim, litigation, investigation or proceeding relating to any of
          the foregoing, whether or not any Indemnitee is a party thereto;
          provided that such indemnity shall not, as to any Indemnitee, be
          available to the extent that such losses, claims, damages,
          liabilities or related expenses (i) are determined by a 


<PAGE>

                                                                        44




          court of competent jurisdiction by final and nonappealable judgment 
          to have resulted from the gross negligence or wilful misconduct of 
          such Indemnitee (treating, for this purpose only, any Bank and its
          directors, officers, employees and agents as a single Indemnitee)
          or (ii) arise from (x) any Receivable which becomes a Charge-Off as
          a result of non-payment by the Obligor with respect thereto, (y)
          any action taken, or omitted to be taken, by any Servicer which is
          not an Affiliate of C&A Products, or (z) any action taken by the
          Banks in collecting from an Obligor.  

                    (c)  The Company shall be entitled to assume the defense
          of any action for which indemnification is sought hereunder with
          counsel of its choice at its expense (in which case the Company
          shall not thereafter be responsible for the fees and expenses of
          any separate counsel retained by an Indemnitee except as set forth
          below); provided, however, that such counsel shall be reasonably
          satisfactory to each such Indemnitee.  Notwithstanding the
          Company's election to assume the defense of such action, each
          Indemnitee shall have the right to employ separate counsel and to
          participate in the defense of such action, and the Company shall
          bear the reasonable fees, costs, and expenses of such separate
          counsel, if (i) the use of counsel chosen by the Company to
          represent such Indemnitee would present such counsel with a
          conflict of interest; (ii) the actual or potential defendants in,
          or targets of, any such action include both the Company and such
          Indemnitee and such Indemnitee shall have reasonably concluded that
          there may be legal defenses available to it that are different from
          or additional to those available to the Company (in which case the
          Company shall not have the right to assume the defense or such
          action on behalf of such Indemnitee); (iii) the Company shall not
          have employed counsel reasonably satisfactory to such Indemnitee to
          represent it within a reasonable time after notice of the
          institution of such action; or (iv) the Company shall authorize
          such Indemnitee to employ separate counsel at the Company's
          expense.  The Company will not be liable under this Agreement for
          any amount paid by an Indemnitee to settle any claims or actions if
          the settlement is entered into without the Company's consent, which
          consent may not be withheld unless such settlement is unreasonable
          in light of such claims or actions against, and defenses available
          to, such Indemnitee.  

                    (d)  Notwithstanding anything to the contrary in this
          subsection 11.3, this subsection 11.3 (other than clause (iii) of
          paragraph (b) thereof) shall not apply to taxes, it being
          understood that the Company's only obligations with respect to
          taxes shall arise under subsections 3.3 and 3.5 and under said
          clause (iii).

                    (e)  The provisions of this subsection 11.3 shall remain
          operative and in full force and effect regardless of the expiration
          of the term of this Agreement, the consummation of the transactions
          contemplated hereby, the repayment of all or any portion of the Net
          Investment, the invalidity or unenforceability of any term or
          provision of this Agreement or any other Transaction Document, or
          any investigation made by or on behalf of the Administrative Agent
          or any Bank.  All amounts due under this subsection 11.3 shall be
          payable on written demand therefor.
           
                    11.4  Successors and Assigns; Participations; Acquiring
          Banks.  (a)  The provisions of this Agreement shall be binding upon
          and inure to the benefit of the Company, the Banks, the Master
          Servicer, the Servicers, the Administrative Agent and their
          respective successors and assigns, except that the Company, the
          Servicers and the Master Servicer may not 


<PAGE>


                                                                       45



          assign or transfer any of its or their rights or obligations under 
          this Agreement without the prior written consent of each Bank.

                    (b)  Any Bank may, in the ordinary course of its business
          and in accordance with applicable law, at any time sell to one or
          more banks or other entities ("Participants") a participation in
          the Participating Interest of such Bank, any Commitment of such
          Bank or any other interests of such Bank hereunder.  In the event
          of any such sale by a Bank of a participation to a Participant,
          such Bank's obligations under this Agreement to the other parties
          to this Agreement shall remain unchanged, such Bank shall remain
          solely responsible for the performance thereof, and the Company,
          the Master Servicer, the Servicers and the Administrative Agent
          shall continue to deal solely and directly with such Bank in
          connection with such Bank's rights and obligations under this
          Agreement.  The Company, the Servicers, and the Master Servicer
          agree that if amounts outstanding under this Agreement are due or
          unpaid, each Participant shall be deemed to have the right of
          setoff in respect of its participation in amounts owing under this
          Agreement to the same extent and subject to the same terms and
          conditions as if the amount of its participation were owing
          directly to it as a Bank under this Agreement, provided that such
          right of setoff shall be subject to the obligation of such
          Participant to share with the Banks, and the Banks agree to share
          with such Participant, as provided in subsection 11.12.  The
          Company also agrees that each Participant shall be entitled to the
          benefits of subsections 3.2, 3.3 and 3.5 with respect to its
          Participating Interest; provided that, in the case of subsection
          3.5, such Participant shall have complied with the requirements of
          said subsection and provided further that no Participant shall be
          entitled to receive any greater amount pursuant to such subsections
          than the transferor Bank would have been entitled to receive in
          respect of the amount of the participation transferred by such
          transferor Bank to such Participant had no such transfer occurred. 
          Each Bank will disclose the identity of its participants to the
          Company and Administrative Agent if requested by the Company or the
          Administrative Agent.

                    (c)  Each Bank agrees that any agreement between such
          Bank and any Participant in respect of any participation shall not
          restrict such Bank's right to agree to any amendment, supplement or
          modification to this Agreement or any of the Transaction Documents
          except (i) to extend the Scheduled Termination Date, or increase
          the amount of such Bank's Commitment, or change the definition of
          "Maximum Invested Percentage" so as to permit the Maximum Invested
          Percentage to exceed 83%, or reduce the rate or extend the time of
          payment of any Purchase Discount Amount or Commitment Fee, in each
          case to the extent such Participant is directly affected thereby
          and (ii) to release any substantial portion of the Pooled Property
          (other than pursuant to subsection 5.3 or 12.7).

                    (d)  Any Bank may, in the ordinary course of its business
          and in accordance with applicable law, at any time sell (x) to any
          Bank or any Lender (as defined in the Credit Agreement) or any
          affiliate thereof, and (y) with the consent of the Company and the
          Administrative Agent (which in each case shall not be unreasonably
          withheld or delayed), to one or more additional financial
          institutions ("Acquiring Banks") all or any part of its rights and
          obligations under this Agreement pursuant to an Assignment and
          Acceptance, substantially in the form of Exhibit A, executed by
          such Acquiring Bank and such transferor Bank (and, in the case of a
          Acquiring Bank that is not then a Bank or a Lender (as defined in
          the Credit Agreement) or an affiliate thereof, by the
          Administrative Agent and the Company) and delivered to the


<PAGE>


                                                                   46



          Administrative Agent for its acceptance and recording in the
          register, provided that the Commitment transferred pursuant to any
          such sale to a Acquiring Bank shall be in an amount not less than
          the lesser of $5,000,000 and the amount of such transferor Bank's
          Commitment, unless (i) otherwise agreed by the Company or (ii) the
          assignment is to any Bank or any Lender (as defined in the Credit
          Agreement) or any affiliate thereof.  Upon such execution,
          delivery, acceptance and recording, from and after the effective
          date determined pursuant to such Assignment and Acceptance, (x) the
          Acquiring Bank thereunder shall be a party hereto, shall be subject
          to the requirements of subsections 3.5(f) and (g) and, to the
          extent provided in such Assignment and Acceptance, shall have the
          rights and obligations of a Bank hereunder with a Commitment
          Percentage as set forth therein, and (y) the assigning Bank
          thereunder shall, to the extent provided in such Assignment and
          Acceptance, be released from its obligations under this Agreement
          (and, in the case of an Assignment and Acceptance covering all or
          the remaining portion of an assigning Bank's rights and obligations
          under this Agreement, such assigning Bank shall cease to be a party
          hereto).

                    (e)  The Administrative Agent shall maintain at its
          address referred to in subsection 11.2 a copy of each Assignment
          and Acceptance delivered to it and a register (the "Register") for
          the recordation of the names and addresses of the Banks and the
          Commitment of, and principal amount of the Participating Interests
          owing to, each Bank from time to time.  The entries in the Register
          shall be conclusive, in the absence of manifest error, and the
          Company, the Servicers, the Master Servicer, the Administrative
          Agent and the Banks may treat each Person whose name is recorded in
          the Register as the owner of the Participating Interests recorded
          therein for all purposes of this Agreement.  The Register shall be
          available for inspection by the Company, the Servicers, the Master
          Servicer or any Bank at any reasonable time and from time to time
          upon reasonable prior notice.

                    (f)  Upon its receipt of an Assignment and Acceptance
          executed by an assigning Bank and a Acquiring Bank (and, in the
          case of a Acquiring Bank that is not then a Bank or an affiliate
          thereof, by the Administrative Agent and the Company) together with
          payment to the Administrative Agent of a registration and
          processing fee of $3,500, the Administrative Agent shall (i)
          promptly accept such Assignment and Acceptance and (ii) on the
          effective date determined pursuant thereto record the information
          contained therein in the Register and give notice of such
          acceptance and recordation to the Banks and the Company.

                    (g)  Subject to subsection 11.16, the Master Servicer,
          each Servicer and the Company authorize each Bank to disclose to
          any Participant or Acquiring Bank (each, a "Transferee") and any
          prospective Transferee any and all financial information in such
          Bank's possession concerning such Servicer, the Master Servicer,
          the Company or any of its or their Affiliates which has been
          delivered to such Bank by or on behalf of such Servicer, the Master
          Servicer, the Company or such Affiliate in connection with such
          Bank's credit evaluation of such Servicer, the Master Servicer or
          the Company.

                    11.5  GOVERNING LAW.  THIS AGREEMENT AND THE RIGHTS AND
          OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED
          BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF
          THE STATE OF NEW YORK.


<PAGE>

                                                                        47



                    11.6  No Waiver; Cumulative Remedies.  No failure to
          exercise and no delay in exercising, on the part of the
          Administrative Agent or the Banks, any right, remedy, power or
          privilege hereunder, shall operate as a waiver thereof, nor shall
          any single or partial exercise of any right, remedy, power or
          privilege hereunder preclude any other or further exercise thereof
          or the exercise of any other right, remedy, power or privilege. 
          The rights, remedies, powers and privileges herein provided are
          cumulative and not exhaustive of any rights, remedies, powers and
          privileges provided by law.

                    11.7  Amendments and Waivers.  Neither this Agreement nor
          any terms hereof may be amended, supplemented or modified except in
          accordance with the provisions of this subsection 11.7.  The
          Required Banks may, or, with the written consent of the Required
          Banks, the Administrative Agent may, from time to time, (a) enter
          into with the Company, the Master Servicer and the Servicers
          written amendments, supplements or modifications hereto for the
          purpose of adding any provisions to this Agreement or changing in
          any manner the rights of the Banks, the Company, the Servicers or
          the Master Servicer hereunder or (b) waive, on such terms and
          conditions as the Required Banks or the Administrative Agent, as
          the case may be, may specify in such instrument, any of the
          requirements of this Agreement or any default or Termination Event
          and its consequences; provided, however, that no such waiver and no
          such amendment, supplement or modification shall (i) extend the
          Scheduled Termination Date; or reduce the rate or extend the time
          of payment of any Purchase Discount Amount or Commitment Fee; or
          extend the time of payment of any mandatory reduction of the Net
          Investment; or modify subsection 2.12 so that the fact that the Net
          Investment exceeds the Maximum Transfer Amount does not necessitate
          a mandatory reduction in the Net Investment; or change the
          definition of "Maximum Invested Percentage" so as to permit the
          Maximum Invested Percentage to exceed 83%; or increase the amount
          of any Bank's Commitment; or amend, modify or waive any provision
          of this subsection 11.7; or reduce the percentage specified in the
          definition of Required Banks; or consent to the assignment or
          transfer by the Company, any Servicer or the Master Servicer of any
          of their respective rights and obligations under this Agreement
          (except in accordance with Article XII); or release any substantial
          portion of the Pooled Property (other than pursuant to subsection
          5.3 or 12.7); in each case without the written consent of each Bank
          directly affected thereby or (ii) amend, modify or waive any
          provision of Article X without the written consent of the
          Administrative Agent.  Any such waiver and any such amendment,
          supplement or modification shall apply equally to each of the Banks
          and shall be binding upon the Company, the Servicers, the Master
          Servicer, the Banks, the Administrative Agent and all future
          holders of a Participating Interest.  In the case of any waiver,
          the Company, the Servicers, the Master Servicer, the Banks and the
          Administrative Agent shall be restored to their former position and
          rights hereunder, any default or Termination Event waived shall be
          deemed to be cured and not continuing; but no such waiver shall
          extend to any subsequent or other default or Termination Event, or
          impair any right consequent thereon.

                    11.8  Severability.  Any provision of this Agreement
          which is prohibited or unenforceable in any jurisdiction shall, as
          to such jurisdiction, be ineffective to the extent such prohibition
          or unenforceability without invalidating the remaining provisions
          hereof, and any such prohibition or unenforceability in any
          jurisdiction shall not invalidate or render unenforceable such
          provision in any other jurisdiction.


<PAGE>


                                                                           48



                    11.9  Notices.  All notices, requests and demands to or
          upon the respective parties hereto to be effective shall be in
          writing (including by telecopy), and, unless otherwise expressly
          provided herein, shall be deemed to have been duly given or made
          when delivered by hand, or three days after being deposited in the
          mail, postage prepaid, or, in the case of telecopy notice, when
          received, addressed as follows in the case of the Company and the
          Administrative Agent, as set forth under their signatures on the
          signature pages hereof (in the case of the Master Servicer and the
          Servicers) and as set forth on Schedule 1 hereto (in the case of
          the Banks), or to such other address as may be hereafter notified
          by the respective parties hereto:

              The Company:                Carcorp, Inc.
                                          5025 S. Eastern Avenue
   
                                          Suite 16, Number 205
                                          Las Vegas, Nevada  89119
                                          Attention:  
                                          Telecopy No.: 

              The Administrative Agent:   Chemical Bank Agency Services
                                          140 East 45th Street 
                                          New York, New York  10017
                                          Attention:  James Morgan
                                          Telecopy:  212-622-0002

               with a copy to:            Chemical Bank
                                          270 Park Avenue
                                          New York, New York  10017
                                          Attention:  Suzanne Kjorlien
                                          Telecopy:  212-972-0009

          provided that any notice, request or demand to or upon the
          Administrative Agent or the Banks pursuant to subsections 2.3,
          2.7, 2.8, 2.10, 2.11 and 2.12 shall not be effective until
          received.

                    11.10  Counterparts.  This Agreement may be executed by
          one or more of the parties to this Agreement on any number of
          separate counterparts (including by telecopy), and all of said
          counterparts taken together shall be deemed to constitute one and
          the same instrument.  A set of the copies of this Agreement
          signed by all the parties shall be lodged with the Company and
          the Administrative Agent.

                    11.11  Construction of Agreement as Security Agreement. 
          (a)  It is the intent of the parties that the transactions
          contemplated herein constitute assignments and transfers of the
          Receivables and the Related Property with respect thereto to the
          Banks.  If, however, such transactions are deemed to be loans,
          the Company hereby grants to the Administrative Agent, for the
          benefit of the Banks, a first priority security interest in all
          of the Company's right, title and interest in and to (i) the
          Receivables and the Related Property now existing and hereafter
          created, all monies due or to become due and all amounts received
          with respect thereto, (ii) the Receivables Sale Agreement and
          (iii) all "proceeds" of any of the foregoing, including, without
          limitation, whatever is received upon the sale, exchange,
          collection or other 



<PAGE>

                                                                     49



          disposition of the foregoing or any proceeds
          thereof, to secure all the Company's obligations hereunder.

                    (b)  Each Servicer hereby grants to the Administrative
          Agent on behalf of the Banks a first priority security interest
          in all of the Servicer's right, title and interest in, to and
          under its records relating to the Receivables and Related
          Property serviced by it to secure all of the Company's
          obligations hereunder.

                    (c)  This Agreement shall constitute a security
          agreement under applicable law.

                    11.12  Adjustments; Set-off.  (a)  If any Bank (a
          "benefitted Bank") shall at any time receive any payment of all
          or part of its Participating Interest of the Net Investment, or
          any Purchase Discount Amount in respect thereof, or receive any
          collateral in respect thereof (whether voluntarily or
          involuntarily, by set-off, pursuant to events or proceedings of
          the nature referred to in paragraph (f) of Article IX, or
          otherwise) in a greater proportion than any such payment to and
          collateral received by any other Bank, if any, in respect of such
          other Bank's Participating Interest of the Net Investment, or any
          Purchase Discount Amount in respect thereof, such benefitted Bank
          shall acquire for cash from the other Banks such portion of each
          such other Bank's Participating Interest of the Net Investment,
          or shall provide such other Banks with the benefits of any such
          collateral, or the proceeds thereof, as shall be necessary to
          cause such benefitted Bank to share the excess payment or
          benefits of such collateral or proceeds ratably with each of the
          Banks; provided, however, that if all or any portion of such
          excess payment or benefits is thereafter recovered from such
          benefitted Bank, such acquisition shall be rescinded, and the
          transfer price and benefits returned, to the extent of such
          recovery, but without interest.

                    (b)  In addition to any rights and remedies of the
          Banks provided by law, each Bank shall have the right, without
          prior notice to the Company, any such notice being expressly
          waived by the Company to the extent permitted by applicable law,
          upon any amount, other than amounts in respect of the principal
          amount of the Net Investment and the Purchase Discount Amounts
          with respect thereto, becoming due and payable by the Company
          hereunder (whether at the stated maturity, by acceleration or
          otherwise) to set off and appropriate and apply against such
          amount any and all deposits (general or special, time or demand,
          provisional or final), in any currency, and any other credits,
          indebtedness or claims, in any currency, in each case whether
          direct or indirect, absolute or contingent, matured or unmatured,
          at any time held or owing by such Bank or any branch or agency
          thereof to or for the credit or the account of the Company.  Each
          Bank agrees promptly to notify the Company and the Administrative
          Agent after any such set-off and application made by such Bank,
          provided that the failure to give such notice shall not affect
          the validity of such set-off and application.

                    11.13  Jurisdiction; Consent to Service of Process. 
          (a)  Each of the Company, the Master Servicer and each Servicer
          hereby irrevocably and unconditionally submits, for itself and
          its property, to the nonexclusive jurisdiction of any New York
          State court or Federal court of the United States of America
          sitting in New York City, and any appellate court from any
          thereof, in any action or proceeding arising out of or relating
          to this Agreement or the other Transaction Documents, or for
          recognition or enforcement of any 


<PAGE>

                                                                     50



          judgment, and each of the parties hereto hereby irrevocably and 
          unconditionally agrees that all claims in respect of any such action 
          or proceeding may be heard and determined in such New York State or, 
          to the extent permitted by law, in such Federal court. Each of the 
          parties hereto agrees that a final judgment in any such action or
          proceeding shall be conclusive and may be enforced in other
          jurisdictions by suit on the judgment or in any other manner
          provided by law.  Nothing in this Agreement shall affect any
          right that the Administrative Agent or any Bank may otherwise
          have to bring any action or proceeding relating to this Agreement
          or the other Transaction Documents against the Company, the
          Master Servicer or any Servicer or their properties in the courts
          of any jurisdiction.

                    (b)  Each of the Company, the Master Servicer and each
          Servicer hereby irrevocably and unconditionally waives, to the
          fullest extent it may legally and effectively do so, any
          objection which it may now or hereafter have to the laying of
          venue of any suit, action or proceeding arising out of or
          relating to this Agreement or the other Transaction Documents in
          any New York State or Federal court.  Each of the parties hereto
          hereby irrevocably waives, to the fullest extent permitted by
          law, the defense of an inconvenient forum to the maintenance of
          such action or proceeding in any such court.

                    (c)  Each party to this Agreement irrevocably consents
          to service of process in the manner provided for notices in
          subsection 11.9.  Nothing in this Agreement will affect the right
          of any party to this Agreement to serve process in any other
          manner permitted by law.

                    11.14  Acknowledgements.  Each of the Company, the
          Master Servicer and each Servicer hereby acknowledges that:

                    (a)  it has been advised by counsel in the negotiation,
               execution and delivery of this Agreement and the other
               Transaction Documents to which it is a party;

                    (b)  neither the Administrative Agent nor any Bank has
               any fiduciary relationship with or duty to the Company, the
               Master Servicer or any Servicer arising out of or in
               connection with this Agreement or any of the other
               Transaction Documents, and the relationship between the
               Administrative Agent and the Banks, on one hand, and the
               Company, on the other hand, in connection herewith or
               therewith is solely that of purchaser/creditor and
               seller/debtor; and

                    (c)  no joint venture is created hereby or by the other
               Transaction Documents or otherwise exists by virtue of the
               transactions contemplated hereby among the Banks or among
               the Company, the Master Servicer or any Servicer and the
               Banks.

                    11.15  Waiver of Jury Trial.  Each party hereto hereby
          waives, to the fullest extent permitted by applicable law, any
          right it may have to a trial by jury in respect of any litigation
          directly or indirectly arising out of, under or in connection
          with this Agreement or any of the other Transaction Documents. 
          Each party hereto (a) certifies that no representative, agent or
          attorney of any other party has represented, expressly or
          otherwise, that such other party would not, in the event of
          litigation, seek to enforce the foregoing waiver and (b)
          acknowledges that it and the other parties hereto have been
          induced to enter 


<PAGE>

                                                                      51




          into this Agreement and the other Transaction
          Documents, as applicable, by, among other things, the mutual
          waivers and certifications in this subsection 11.15.

                    11.16  Confidentiality.  Each of the Banks and the
          Administrative Agent agrees that it shall maintain in confidence
          any information relating to the Company, the Master Servicer or
          any Servicer furnished to it by or on behalf of the Company, the
          Master Servicer or any Servicer (other than information that (x)
          has become generally available to the public other than as a
          result of a disclosure by such party, (y) has been independently
          developed by such party without violating this subsection 11.16
          or (z) was available to such party from a third party having, to
          such party's knowledge, no obligation of confidentiality to the
          Company, the Master Servicer or such Servicer, as the case may
          be) and shall not reveal the same other than (i) to its
          directors, officers, employees and advisors with a need to know
          and (ii) as contemplated by subsection 11.4(g), except:  (a) to
          the extent necessary to comply with law or any legal process or
          the requirements of any Governmental Authority or of any
          securities exchange on which securities of the disclosing party
          or any Affiliate of the disclosing party are listed or traded,
          (b) as part of normal reporting or review procedures to
          Governmental Authorities or its parent companies, Affiliates or
          auditors and (c) in order to enforce its rights under any
          Transaction Document in a legal proceeding.

                    11.17  No Bankruptcy Petition.  Each Servicer, the
          Master Servicer, each Bank and the Administrative Agent covenants
          and agrees that, prior to the date which is one year and one day
          after the date of termination of this Agreement pursuant to
          subsection 4.1, it will not institute against, or join any other
          Person in instituting against, the Company any bankruptcy,
          reorganization, arrangement, insolvency or liquidation
          proceedings, or other proceedings under any federal or state
          bankruptcy or similar law.

                    11.18  Tax Treatment.  (a) The execution and delivery
          of this Agreement shall constitute an acknowledgement by the
          Banks, the Administrative Agent, the Company, the Master Servicer
          and each Servicer that they do not intend to establish (for
          Federal tax purposes) an association taxable as a corporation. 
          The powers granted and obligations undertaken in this Agreement
          shall be construed so as to further such intent.  

                    (b)  It is the intent of the Company and the Banks
          that, for federal, state and local income and franchise tax
          purposes, the Participating Interest will be indebtedness of the
          Company secured by the Pooled Property.  The Company and the
          Banks agree to treat the Company as the owner of the Pooled
          Property and the Participating Interest as indebtedness of the
          Company secured by the Pooled Property and the Purchase Discount
          Amount as interest for federal, state and local income and
          franchise tax purposes (including for reporting purposes), except
          as otherwise required by law or any tax authorities.  This
          subsection 11.18 shall survive the termination of this Agreement
          and shall be binding on all Transferees.

                    11.19  No Action by Banks.  Each of the Banks and the
          Administrative Agent hereby agrees that, until the occurrence of
          a Purchase Termination Event, an Incipient Purchase Termination
          Event or a Servicer Event of Default, the Banks will not
          exercise, or otherwise direct the Administrative Agent to
          exercise on their behalf, the rights of the Company pursuant to
          subsection 5.15(d) of the Receivables Sale Agreement.



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                                                                        52



                                     ARTICLE XII

                                      Servicing

                    12.1  Servicing.  (a)  Appointment of Servicers.  The
          Banks and the Company hereby appoint (i) the Servicers as their
          agents to service and administer the Receivables originated by
          such Persons in their capacities as Sellers and (ii) C&A Products
          as their agent to coordinate the servicing of the Receivables by
          the Servicers.  Each of the Servicers and the Master Servicer
          hereby consents to such appointment and agrees to service and
          administer the Receivables in accordance with the terms and
          conditions contained herein.  The Company hereby appoints the
          Master Servicer, and the Master Servicer hereby consents to such
          appointment, to take any actions on behalf of the Company which
          by the terms hereof have been delegated to the Master Servicer
          and any further actions incidental thereto.  The Company and the
          Master Servicer may agree, in accordance with subsection 8.11,
          that the Master Servicer may perform on behalf of the Company
          certain of the Company's obligations under the Transaction
          Documents.  Prior to the occurrence of a Complete Servicing
          Transfer, on each Settlement Date, the Servicers and the Master
          Servicer shall receive the Monthly Servicing Fee for performing
          their functions as Servicers and Master Servicer hereunder as
          provided in subsection 2.7.

                    (b)  Collection Procedures.  (i)  Each Collection shall
          be deposited into a Lockbox Account and shall be transferred from
          such Lockbox Account (either directly or through an intermediate
          Lockbox Account (an "Intermediate Lockbox Account") at the same
          Lockbox Bank) to the relevant Concentration Account at least as
          often as once each day that is a business day for the applicable
          Lockbox Bank and for Chemical, such transfer from such Lockbox
          Account and from any such Intermediate Lockbox Account, in each
          case, to be commenced in any event by 1:00 p.m. (New York City
          time) on the business day following such day of deposit; provided
          that Collections may, at the option of the applicable Obligor, be
          deposited directly into the relevant Concentration Account by
          wire transfer from an account of such Obligor to the
          Concentration Account or by means of transfer through the
          Automated Clearing House System.  Each of the Company, the Master
          Servicer and each Servicer acknowledges and agrees that it shall
          not have any right to withdraw any funds or any remittance
          advisements or payment invoices on deposit in any Concentration
          Account or any Lockbox Account except as otherwise expressly
          provided in this Agreement or in the Lockbox Agreements; provided
          however that until the date which is 60 days after the Effective
          Date (at which time a Lockbox Account in the name of the Company
          shall have been established, as required hereunder), the
          Servicers set forth on Schedule 3 which do not have, as of the
          Effective Date, a Lockbox Account in place, shall be allowed to
          continue to receive and deposit Collections in the same manner in
          which such Servicer receives and deposits Collections as of the
          Effective Date.

                    (ii)  All Collections otherwise received by any
          Servicer, the Master Servicer or the Company shall be deposited
          by it either to a Lockbox Account or through the Automated
          Clearing House System into the relevant Concentration Account as
          soon as possible after receipt thereof, such transfer to commence
          in no event later than the Business Day after such receipt.


<PAGE>

                                                                       53




                    (iii)  Each of the Company, the Master Servicer and
          each Servicer represents, warrants, covenants and agrees that all
          Collections shall be collected, processed and deposited pursuant
          to, and in accordance with, the terms of this Agreement.

                    (iv)  The Company represents, warrants, covenants and
          agrees that it shall not make or maintain any deposits in any
          bank account, deposit account or trust account with any financial
          institution other than the Lockbox Accounts and the Concentration
          Accounts as provided for by this Agreement and other than one
          operating account funded solely with amounts disbursed as
          operating expenses pursuant to subsection 2.7.  The Company shall
          provide the Administrative Agent with the account number and
          location of such account, and any other information as the
          Administrative Agent may reasonably request with respect thereto. 
          The Company represents, warrants, covenants and agrees that it
          shall have no bank accounts, deposit accounts or trust accounts
          other than the Lockbox Accounts and the Concentration Accounts
          and such operating account.  The Company represents, warrants,
          covenants and agrees that no new bank accounts or deposit
          accounts will be established unless and until the Company has
          received the prior written consent of the Administrative Agent.

                    (v)  Each of the Company, the Master Servicer and each
          Servicer represents, warrants, covenants and agrees that no
          location other than the Lockbox Accounts, and, with respect to
          wire transfers, the Concentration Accounts, has been established
          for the deposit of Collections; provided however that until the
          date which is 60 days after the Effective Date (at which time a
          Lockbox Account in the name of the Company shall have been
          established, as required hereunder), the Servicers set forth on
          Schedule 3 which do not have, as of the Effective Date, a Lockbox
          Account in place, shall be allowed to continue to receive and
          deposit Collections in the same manner in which such Servicer
          receives and deposits Collections as of the Effective Date.  Each
          of the Company, the Master Servicer and each Servicer represents,
          warrants, covenants and agrees that no new location for the
          deposit of Collections will be established unless and until the
          Company has received the prior written consent of the
          Administrative Agent.

                    (vi)  The Company agrees to pay all fees for the
          services of the Lockbox Banks.

                    (vii)  Notwithstanding anything to the contrary in this
          Agreement, all Receivables Proceeds shall be deposited (directly
          or through a Lockbox Account in the case of Collections) into the
          U.S. Concentration Account; except that Receivables Proceeds in
          respect of any Receivable as to which the Obligor and/or the
          Seller is organized or located in Canada may instead be deposited
          (directly or through a Lockbox Account in the case of
          Collections) into the Canada/Canadian Dollar Concentration
          Account (in the case of Receivables denominated in Canadian
          Dollars) or the Canada/U.S. Dollar Concentration Account (in the
          case of Receivables denominated in U.S. Dollars).

                    (c)  Lockbox Accounts.  Within 60 days after the
          Effective Date, the Company shall deliver to the Administrative
          Agent fully executed letter agreements in substantially the form
          of Exhibit B (the "Lockbox Agreements") from each Lockbox Bank,
          (x) with such changes as to which the Administrative Agent
          reasonably consents or (y) in such form as the 



<PAGE>

                                                                        54



          Lockbox Bank party thereto requires in the ordinary course of its 
          business for transactions of a type similar to those contemplated by 
          this Agreement.

                    (i)  The Company shall instruct, or cause the Servicers
          to instruct, each Lockbox Bank to transfer at least as often as
          once each day that is a business day for such Lockbox Bank and
          for Chemical and in any event by 1:00 p.m. (New York City time)
          on the business day following each such day of deposit, via the
          Automated Clearing House System, all available funds on deposit
          in any Lockbox Account on such day to the relevant Concentration
          Account (either directly or through an Intermediate Lockbox
          Account) along with (unless otherwise provided in the related
          Lockbox Agreement) any remittance advisements or payment invoices
          on deposit therein.  

                    (ii)  In the event the Company (with the consent of the
          Administrative Agent) or any Servicer or any Lockbox Bank shall,
          after the date hereof, terminate the Lockbox Agreement with
          respect to the maintenance of any Lockbox Account with any
          Lockbox Bank for any reason, or, in the event (A) a Termination
          Event or Potential Termination Event shall occur and be
          continuing or (B) there has been a failure by any Lockbox Bank to
          perform any of its material obligations under the applicable
          Lockbox Agreement and such failure could have a Material Adverse
          Effect on the Banks' interest in any Receivables or the
          Administrative Agent's or the Banks' rights, or ability to
          exercise any remedies, under this Agreement, if the
          Administrative Agent shall demand such termination, the Company
          agrees to notify, or cause the responsible Servicer to notify
          (and, if the Company or such Servicer fails to so notify, the
          Company irrevocably grants the Administrative Agent the authority
          to notify) all Obligors that were depositing Collections into
          such terminated Lockbox Account or Lockbox Bank to make all
          future deposits to another Lockbox Bank with which the Company
          has a Lockbox Agreement that has not been terminated by the
          Company, by such Lockbox Bank or by demand from the
          Administrative Agent; provided, however, that, if the
          Administrative Agent shall demand termination of any Lockbox
          Accounts of the Company with all Lockbox Banks, the Company
          agrees to notify, or cause the responsible Servicer to notify
          (and, if the Company or such Servicer fails to so notify, the
          Company irrevocably grants the Administrative Agent the authority
          to notify) all Obligors to make all future payments directly to
          the relevant Concentration Account or any other account
          designated by the Administrative Agent.

                    (iii)  The Company represents, warrants, covenants and
          agrees that (x) upon execution of a Lockbox Agreement with
          respect thereto the Administrative Agent will be authorized to
          receive mail delivered to any Lockbox Bank with respect to any
          Lockbox Account and (y) within 60 days after the Effective Date,
          a form of standing delivery order shall have been filed by the
          Company with the United States Postal Service authorizing the
          Administrative Agent to receive mail delivered to Lockbox Banks
          with respect to any Lockbox Account.

                    (iv)  The Administrative Agent shall have sole and
          exclusive dominion over and control of each Lockbox Account and
          the Company and the Servicer shall not have any dominion over or
          control of any Lockbox Account, other than the right to authorize
          transfers to the Concentration Accounts (and to any Intermediate
          Lockbox Account) as set forth herein and pursuant to the terms
          hereof.


<PAGE>


                                                                       55



                    (v)  Each of the Company, the Master Servicer and each
          Servicer agrees that the Administrative Agent shall have the
          unconditional right at any time, whether or not a Termination
          Event or Potential Termination Event has occurred, (i) to
          instruct any Lockbox Bank to transfer, via the Automated Clearing
          House System, all available funds on deposit in any Lockbox
          Account to the relevant Concentration Account or (ii) to instruct
          any Lockbox Bank to thereafter transfer automatically at least as
          often as once each day that is a business day for such Lockbox
          Bank and for Chemical and in any event at the opening of business
          on the business day following each such day of deposit, via the
          Automated Clearing House System, all available funds on deposit
          in any Lockbox Account to the relevant Concentration Account
          along with any remittance advisements or payment invoices on
          deposit therein.  Any such instructions may be revoked only upon
          the written direction of the Administrative Agent.

                    (d)  The Administrative Agent shall treat all
          collections received by it or deposited in any Concentration
          Account as "Collections" for purposes of this Agreement as of the
          Business Day Received (as defined in the immediately succeeding
          sentence).  As used herein, the term "Business Day Received"
          shall mean (i) if funds are otherwise deposited in the
          Concentration Account by 1:00 p.m. (New York City time), such day
          of deposit and (ii) if funds are deposited in the Concentration
          Account after 1:00 p.m. (New York City time), the Business Day
          next following such day of deposit.

                     12.2  Collections by the Servicers.  (a)  Each
          Servicer will, at its cost and expense and as agent for the Banks
          and the Company, use its best efforts to collect, consistent with
          its past practices, as and when the same becomes due, the amount
          owing on each Receivable for which it is the Servicer.  No
          Servicer will make any material changes that deviate from the
          Policies or the Company Policies in its administrative, servicing
          and collection systems without the prior written approval of the
          Required Banks.  In the event of default under any Receivable,
          the responsible Servicer shall have the power and authority, on
          behalf of the Banks and the Company, to take such action in
          respect of such Receivable as such Servicer may reasonably deem
          advisable.  In the enforcement or collection of any Receivable,
          each Servicer shall be entitled to sue thereon in (i) its own
          name, (ii) if, but only if, the Administrative Agent consents in
          writing, as agent of the Banks, or (iii) if, but only if, the
          Company consents in writing, as agent for the Company.  In no
          event shall any Servicer or the Master Servicer be entitled to
          take any action which would make the Administrative Agent or any
          of the Banks or the Company a party to any litigation without the
          express prior written consent of the Administrative Agent or each
          such Bank or the Company, as the case may be.  



                    (b)  The Master Servicer and the Servicers which are
          Affiliates of the Company, jointly and severally, agree to defend
          and indemnify the Banks and the Administrative Agent against all
          reasonable costs, expenses, claims and liabilities in respect of
          any action taken by the Master Servicer or any Servicer which is
          an Affiliate of the Company arising out of its collection or
          servicing efforts and relative to any Receivable or relative to
          any failure of compliance of any Receivable with the provisions
          of any law or regulation, whether Federal, state, local or
          foreign, applicable thereto (including, without limitation, any
          usury law).  Each Master Servicer or Servicer which is not an
          Affiliate of the Company agrees to defend and indemnify the Banks
          and the Administrative Agent and the Company and the Sellers
          against all reasonable costs, expenses, claims and liabilities in
          respect of any 



<PAGE>

                                                                        56



          action taken by such Servicer or such Master
          Servicer, as the case may be, relative to any Receivable, or
          arising out of any failure of compliance of any Receivable with
          the provisions of any law or regulation, whether Federal, state,
          local or foreign, applicable thereto (including, without
          limitation, any usury law).   The Administrative Agent and the
          Banks shall have no obligation to, and unless and until the
          occurrence of an event described in clause (i) or (ii) of the
          second sentence of subsection 12.2(d) neither the Administrative
          Agent nor the Banks shall, take any action or commence any legal
          proceedings to realize upon any Receivable (including, without
          limitation, any Defaulted Receivable) or to enforce any of their
          rights or remedies with respect thereto.  Notwithstanding
          anything to the contrary contained in this subsection 12.2(b),
          neither the Master Servicer nor any Servicer shall be obligated
          to indemnify or otherwise hold any Person harmless with respect
          to any losses arising from the nonpayment of any Receivable by or
          on behalf of the related Obligor.

                    (c)  The Servicers, the Master Servicer and the Company
          each hereby irrevocably grant to the Administrative Agent an
          irrevocable power of attorney, with full power of substitution,
          coupled with an interest, to take in the name of the Master
          Servicer, such Servicer or the Company or in its own name at any
          time after the occurrence of a Complete Servicing Transfer all
          steps necessary or advisable to endorse, negotiate or otherwise
          realize on any writing or other right of any kind held or owned
          by the Master Servicer, such Servicer or the Company or
          transmitted to or received by the Administrative Agent as payment
          on account or otherwise in respect of any Receivable.

                    (d)  Upon the occurrence and during the continuance of
          any Servicer Event of Default, the Administrative Agent shall, at
          the request of the Required Banks, by giving two Business Days'
          notice in writing to the Master Servicer (a "Transfer Notice"),
          terminate any or all Servicer or Master Servicer administrative,
          servicing and collection functions provided for herein as to any
          or all of the Servicers and the Master Servicer (the termination
          of all such functions with respect to all Servicers and the
          Master Servicer being referred to as a "Complete Servicing
          Transfer" and any other such termination being referred to as a
          "Partial Servicing Transfer").  Upon the occurrence of either a
          Partial Servicing Transfer or a Complete Servicing Transfer,
          without limitation, (i) a designee of the Required Banks (for
          purposes of paragraphs (d) through (e) of this subsection 12.2,
          the term "Substitute Servicer" means such designee, as
          appropriate) shall administer the administrative, servicing and
          collection functions of each terminated Servicer (each, a
          "Transferring Servicer") (in the case of a Partial Servicing
          Transfer) or all Servicers and the Master Servicer (in the case
          of a Complete Servicing Transfer) in any manner it deems fit
          (which may include notifying any Obligor of the assignment to the
          Banks of the interest in the affected Receivables and/or
          directing any Obligor to make all payments in respect of the
          affected Receivables in the name of the Substitute Servicer),
          provided that the Substitute Servicer shall furnish or cause to
          be furnished to the Company such information as such Company
          needs to perform its obligations under this Agreement, and the
          Company may, without independent investigation, rely on such
          information for all purposes of this Agreement and (ii) the
          Company, each Transferring Servicer (in the case of a Partial
          Servicing Transfer) or each Servicer and the Master Servicer (in
          the case of a Complete Servicing Transfer) shall, at its own
          expense, (x) if so requested by the Substitute Servicer, endorse
          each instrument, if any, evidencing any Receivable to the
          Substitute Servicer in such manner as the Substitute Servicer
          shall reasonably direct and (y) perform, or cause to be performed
          by any Person involved in administrative, servicing or 


<PAGE>

                                                                      57




          collection functions on behalf of or under the direction of each
          Transferring Servicer (in the case of a Partial Servicing
          Transfer) or each Servicer and the Master Servicer (in the case
          of a Complete Servicing Transfer) or the Company, any and all
          acts, any and all documents as, in each case, may be reasonably
          requested by the Substitute Servicer in order to effect the
          purposes of this Agreement and the transfer and assignment of the
          Participating Interest and to perfect and protect the ownership
          interest of the Banks in the Receivables and the Related
          Property.  Each Servicer agrees to serve as a Substitute Servicer
          if so designated by the Required Banks at any time and from time
          to time.  Upon the occurrence of a Partial Servicing Transfer or
          a Complete Servicing Transfer, each Transferring Servicer (in the
          case of a Partial Servicing Transfer) or each Servicer and the
          Master Servicer (in the case of a Complete Servicing Transfer)
          shall promptly transfer its electronic records relating to its
          Receivables to the Substitute Servicer in such electronic form as
          the Substitute Servicer may reasonably request and shall promptly
          transfer to the Substitute Servicer all other records,
          correspondence and documents necessary for the continued
          servicing of such Receivables in the manner and at such times as
          the Substitute Servicer shall reasonably request; provided that
          to the extent that such Transferring Servicer or such Servicer
          and the Master Servicer, as the case may be, is required to have,
          as a result of a continuing relationship with the related
          Obligors, access to any such records in respect of its
          Receivables, the Substitute Servicer shall allow such
          Transferring Servicer or such Servicer and the Master Servicer,
          as the case may be, to have reasonable access to such records
          upon reasonable advance notice and so long as such access shall
          not disrupt or otherwise interfere with the Substitute Servicer's
          use of such records in performing its duties hereunder.

                    (e)  Each Transferring Servicer (in the case of a
          Partial Servicing Transfer) or each Servicer and the Master
          Servicer (in the case of a Complete Servicing Transfer) and the
          Company shall each execute and deliver such additional documents
          and shall take such further action as the Substitute Servicer may
          reasonably request to effect or evidence the transfer of
          servicing and shall execute and deliver to the Substitute
          Servicer such powers-of-attorney (in addition to the power of
          attorney provided for in subsection 12.2(c)) as may be necessary
          or appropriate to enable the Substitute Servicer, on behalf of
          the Banks, to endorse for payment any check, draft or other
          instrument delivered in payment of any amount under or in respect
          of an affected Receivable.  If, at any time when the provisions
          of subsection 12.1(c) shall have become operative, any Servicer,
          the Master Servicer or the Company receives any cash or checks,
          drafts or other instruments for the payment of money on account
          or otherwise in respect of the Purchased Receivables, such
          Servicer, the Master Servicer or the Company shall segregate such
          cash and other items, hold such cash and other items in trust for
          the benefit of the Banks and cause such cash and other items
          (properly endorsed, where required, so that such items may be
          collected by the Substitute Servicer) to be transmitted or
          delivered to the Substitute Servicer for deposit in the relevant
          Concentration Account within one Business Day after the date any
          such cash or other item shall have been identified and segregated
          by such Servicer, the Master Servicer or the Company as being on
          account of a Purchased Receivable.

                    12.3  Maintenance of Records.  Each Servicer and the
          Master Servicer will hold in trust for the Banks at the office of
          such Servicer or Master Servicer set forth in Schedule 2 such
          books of account and other records as it currently maintains for
          its own purposes in the ordinary course of its business, provided
          that, as of the date which is three 


<PAGE>

                                                                       58



          months following the Effective Date, such books of account 
          and other records shall be in a form reasonably satisfactory 
          to the Administrative Agent to determine at any time the 
          status of the Receivables and all collections and 
          payments in respect thereof (including, without limitation, 
          an ability to recreate records evidencing Receivables
          in the event of the destruction of the originals thereof).  The
          Administrative Agent may at any time and from time to time upon
          reasonable prior notice during the regular business hours of any
          Servicer or the Master Servicer inspect, audit, check and make
          abstracts from the books, accounts, records, or other papers of
          such Servicer or the Master Servicer pertaining to the
          Receivables.  From time to time upon the written request of the
          Administrative Agent, which request shall be promptly made upon a
          request therefor to the Administrative Agent by any Bank, each
          Servicer or the Master Servicer, at its own expense, will as
          promptly as is practicable deliver to the Administrative Agent a
          schedule of the Receivables indicating as to each Receivables
          information as to the Obligor thereon, the unpaid balance
          thereof, the amount and delinquency of any Receivable that is
          past due and such other information as the Administrative Agent
          may reasonably request.  Upon the written request of the
          Administrative Agent, which request may only be made at any time
          after a Partial Servicing Transfer or a Complete Servicing
          Transfer, each terminated Servicer and the Master Servicer, at
          its own expense, will deliver to the Administrative Agent, or to
          any agent selected by the Administrative Agent, any records
          pertaining thereto and evidence thereof as the Administrative
          Agent may deem necessary to enable it to enforce the Banks'
          rights thereunder; provided that to the extent that such
          terminated Servicer or the Master Servicer is required to have,
          as a result of a continuing relationship with the related
          Obligors, access to any such records in respect of its
          Receivables, the Administrative Agent (or the agent selected by
          it) shall allow such terminated Servicer or the Master Servicer
          to have reasonable access to such records upon reasonable advance
          notice and so long as such access shall not disrupt or otherwise
          interfere with the Administrative Agent's (or its agent's) use of
          such records in performing its duties hereunder.  Upon the
          expiration of the Commitment Period, the reduction of the Net
          Investment to zero and the payment in full of all amounts owing
          to the Banks and the Administrative Agent hereunder, the
          Administrative Agent will promptly return to the Servicers and
          the Master Servicer any such records delivered to the
          Administrative Agent or its agent.  

                    12.4  Rebates, Adjustments, Returns and Reductions;
          Modifications.  From time to time a Servicer may make Adjustments
          to Receivables in accordance with subsection 12.6(p).  If the
          Master Servicer or any Servicer makes any Adjustment, then, in
          any such case, the amount of Receivables will be automatically
          reduced by the principal amount of such Adjustment.  Any
          Adjustment shall be made on the Business Day on which such
          adjustment obligation arises or is identified.  In addition, if,
          after giving effect to any such Adjustment, the Invested
          Percentage would exceed the Maximum Invested Percentage, the
          Company shall pay to the Administrative Agent, for the account of
          the Banks, an amount equal to the lesser of (i) the dollar amount
          of such Adjustment and (ii) the amount necessary to cause the
          Invested Percentage to equal the Maximum Invested Percentage (the
          amount of each such payment is referred to herein as an
          "Adjustment Payment").  Such Adjustment Payment shall be treated
          as a Collection and shall be distributed in accordance with the
          applicable provisions of subsection 2.7.

                    12.5  Daily Reports; Settlement Statements.  (a)  (i) 
          On each Business Day the Master Servicer will prepare a written
          report (the "Daily Report") in the form of Exhibit H, 



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                                                                        59



          with such changes as may be agreed upon by the Administrative Agent 
          and the Master Servicer, setting forth for the second preceding 
          Business Day (the "Reporting Day") total Collections, the estimated 
          amount of Receivables and Eligible Receivables created, and such other
          information as the Administrative Agent may request.  The Master
          Servicer shall complete such Daily Report and deliver it to the
          Administrative Agent prior to 12:00 Noon (New York City time) on
          the second Business Day following the Reporting Day.  Each Daily
          Report shall be transmitted by telecopy to the Administrative
          Agent at the telecopy number specified in subsection 11.9.

                    (ii)  On each Business Day, each Servicer shall provide
          the Master Servicer with a written report (a "Seller Daily
          Report") with respect to the Receivables serviced by such
          Servicer, in a form to be agreed upon by such Servicer and the
          Master Servicer, which report shall contain such information as
          the Master Servicer shall need or otherwise request in order to
          complete the Daily Report.

                    (b)  (i)  Not later than two Business Days prior to
          each Settlement Date until the Participating Interest of the
          Banks in the Receivables has been reduced to zero and the
          Commitments of the Banks hereunder have been terminated, the
          Master Servicer shall submit to the Administrative Agent a
          statement (hereinafter, a "Settlement Statement"), substantially
          in the form attached hereto as Exhibit E or such other form as
          may be acceptable to the Administrative Agent.  Promptly upon
          receipt thereof, the Administrative Agent shall forward a copy of
          each Settlement Statement to each Bank.

                    (ii)  Not later than three Business Days prior to each
          Settlement Date, each Servicer shall provide the Master Servicer
          with a written report (a "Seller Settlement Statement") with
          respect to the Receivables serviced by such Servicer, in a form
          to be agreed upon by such Servicer and the Master Servicer, which
          report shall contain such information as the Master Servicer
          shall need or otherwise request in order to complete the
          Settlement Statement.

                    (c)  (i)  Within 45 days after the end of each fiscal
          quarter of C&A Products, the Master Servicer will deliver to the
          Administrative Agent and each Bank a certificate of a Responsible
          Officer of the Master Servicer stating that (a) a review of the
          activities of the Master Servicer and each Servicer and its
          performance hereunder during such fiscal quarter was made under
          the supervision of such Responsible Officer, (b) to the best
          knowledge of such Responsible Officer, based on such review, the
          Master Servicer and each Servicer has accurately and correctly
          performed its obligations hereunder in all material respects
          throughout such quarter, or, if there has been a material default
          in the performance of any such obligation, specifying the nature
          and status of each such default and (c) to the best knowledge of
          such Responsible Officer, based on such review, each Daily Report
          and Settlement Statement was accurate and correct in all material
          respects, except as specified in such certificate.

                    (ii)  In connection with the annual audit of the Master
          Servicer referred to in subsection 12.6(s)(i) and at the
          Administrative Agent's prior request therefor, within 90 days
          after the end of each fiscal year of C&A Products, the Master
          Servicer shall cause a firm of independent certified public
          accountants (who may also render other services to the Master



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                                                                       60




          Servicer, the Servicers and the Company) to deliver to the
          Administrative Agent and each Bank a report of examination to the
          effect that such firm has examined the activities of the Master
          Servicer and each Servicer with respect to the Receivables and
          its performance hereunder during such fiscal year and that such
          examination included tests relating to Receivables serviced and
          such other auditing procedures as such firm considered necessary
          under the circumstances and, except as described in such report,
          disclosed no material exceptions or errors in the records
          relating to the Receivables serviced and its material performance
          hereunder that, in such firm's opinion, are required to be
          reported by such firm.

                    12.6  Representations, Warranties and Covenants of the
          Servicers.  Each Servicer and the Master Servicer hereby makes
          the following representations, warranties and covenants to the
          Banks and the Administrative Agent:

                    (a)  Organization; Corporate Powers.  Such Person (i)
               is a corporation duly organized, validly existing and in
               good standing under the laws of the jurisdiction in which it
               is incorporated, (ii) has all requisite corporate power and
               authority, and all material licenses, permits, franchises,
               consents and approvals, to own or lease its property and
               assets and to carry on its business as now conducted and as
               proposed to be conducted, (iii) is duly qualified to do
               business and is in good standing as a foreign corporation
               (or is exempt from such requirements) and has obtained all
               necessary licenses and approvals in each jurisdiction in
               which the servicing of the Receivables as required by this
               Agreement requires such qualification except where the
               failure to so qualify or obtain licenses or approvals would
               not have a Material Adverse Effect and (iv) has the
               corporate power and authority to execute, deliver and
               perform this Agreement.

                    (b)  Authorization.  The execution, delivery and
               performance by such Person of this Agreement and the
               consummation of the other Transactions (i) have been duly
               authorized by all requisite corporate and, if required,
               stockholder action and (ii) will not (x) violate (A) any
               provision of law, statute, rule or regulation (including,
               without limitation, Regulations G, T, U and X) or the
               certificate of incorporation or by-laws (or similar
               governing documents) of such Person, (B) any applicable
               order of any court or any rule, regulation or order of any
               Governmental Authority or (C) any indenture, certificate of
               designation for preferred stock, agreement or other
               instrument to which such Person is a party or by which such
               Person or any of its property is bound, (y) be in conflict
               with, result in a breach of or constitute (with notice or
               lapse of time or both) a default under any such indenture,
               agreement or other instrument where any such conflict,
               violation, breach or default referred to in clause (ii)(x)
               or (ii)(y) of this subsection 12.6(b), individually or in
               the aggregate, would have a Material Adverse Effect or (z)
               result in the creation or imposition of any Lien upon any
               property or assets of the such Person.

                    (c)  Enforceability.  This Agreement has been duly
               executed and delivered by such Person and constitutes a
               legal, valid and binding obligation of such Person
               enforceable against such Person in accordance with its
               terms, except as enforceability may be limited by
               bankruptcy, insolvency, moratorium, reorganization or other
               similar laws affecting creditors' rights generally and
               except as enforceability may be limited 


<PAGE>

                                                                    61


               by general principles of equity (regardless of whether such
               enforceability is considered in a proceeding in equity or at
               law).

                    (d)  Litigation, etc.  (i)  There are not any actions,
               suits or proceedings at law or in equity or by or before any
               court or Governmental Authority now pending or, to the
               knowledge of such Person, threatened against or affecting
               such Person or any property or rights of such Person as to
               which there is a reasonable possibility of an adverse
               determination and which (x) if adversely determined, could
               individually or in the aggregate result in a Material
               Adverse Effect or (y) involve the Transaction Documents or
               (z) if adversely determined could materially adversely
               affect the Transactions.

                    (ii) Such Person is not in default with respect to any
               law, order, judgment, writ, injunction, decree, rule or
               regulation of any Governmental Authority where such default
               could have a Material Adverse Effect.  The Transactions will
               not violate any applicable law or regulation or violate or
               be prohibited by any judgment, writ, injunction, decree or
               order of any court or Governmental Authority or subject such
               Person to any civil or criminal penalty or fine.

                    (e)  Taxes.  Such Person and each of its Subsidiaries
               has filed or caused to be filed all Federal, and material
               state, local and foreign, tax returns required to have been
               filed by it and has paid or caused to be paid all taxes
               shown thereon to be due and payable, and any assessments
               received by it, except taxes that are being contested in
               good faith by appropriate proceedings and such Person or
               such Subsidiary, as the case may be, shall set aside on its
               books adequate reserves as required by GAAP with respect
               thereto.  For purposes of this paragraph, "taxes" shall mean
               any present or future tax, levy, impost, duty, charge,
               assessment or fee of any nature (including interest,
               penalties and additions thereto) that is imposed by any
               Governmental Authority.



                    (f)  Consents.  All consents and approvals of, filings
               and registrations with, and other actions in respect of, all
               Governmental Authorities required in order to make or
               consummate the Transactions have been obtained, given, filed
               or taken and are in full force and effect, other than any
               such consents, approvals, filings or other actions, the
               failure to obtain or make which could not reasonably be
               expected to result in a Material Adverse Effect.

                    (g)  Compliance with Requirements of Law.  Such Person
               (i) shall duly satisfy all obligations on its part to be
               fulfilled under or in connection with the servicing and
               collection of the Receivables, (ii) will maintain in effect
               all qualifications required under Requirements of Law in
               order to properly service the Receivables and (iii) will
               comply in all respects with all Requirements of Law in
               connection with servicing the Receivables, except, in each
               case, where such conduct could not have a Material Adverse
               Effect.

                    (h)  Agreement to Cooperate.  The Master Servicer shall
               from time to time and at any time provide, and shall cause
               its Subsidiaries to provide, information with 


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                                                                      62



               respect to the business, operations, properties and financial 
               matters of the Master Servicer and such Subsidiaries to the 
               Company, its officers, employees, agents and professional 
               advisers in connection with the replacement or refinancing, in 
               whole or in part, of this Agreement and the other Transaction
               Documents with a new receivables financing facility in which
               ownership interests in, or notes, commercial paper,
               certificates or other debt instruments secured by, the
               Receivables shall be sold in one or more public offerings,
               private placements or otherwise (such facility, the
               "Replacement Facility"), and the Master Servicer shall
               otherwise cooperate with, and cause its Subsidiaries to
               cooperate with, the Company and such officers, employees,
               agents and professional advisers in the negotiation,
               development, preparation and execution of, such Replacement
               Facility.

                    (i)  Protection of Banks' Rights.  Such Person shall
               take no action, nor omit to take any action, which act or
               omission would substantially impair the rights of Banks in
               the Receivables, nor shall it reschedule, revise or defer
               payments due on any Receivable except in accordance with the
               Policies and the Company Policies or except as otherwise
               expressly permitted by this Agreement; provided, that such
               Person shall have no obligation to the Banks or the
               Administrative Agent under this paragraph (i) in respect of
               Receivables which become Charge-Offs as a result of non-
               payment by the Obligor with respect thereto.

                    (j)  Security Interest.  Except for the conveyance
               hereunder and under the Receivables Sale Agreement, such
               Person will not sell, pledge, assign or transfer to any
               other Person, or grant, create, incur, assume or suffer to
               exist any Lien on any Receivable or other Pooled Property
               transferred and assigned to the Banks, whether now existing
               or hereafter created, or any interest therein, and such
               Person shall defend the right, title and interest of the
               Banks in, to and under any Receivable or other Pooled
               Property transferred and assigned to the Banks, whether now
               existing or hereafter created, against all claims of third
               parties claiming through or under such Person, the Master
               Servicer or any Seller.

                    (k)  Location of Offices.  The chief executive office
               of each Servicer and the Master Servicer is listed on
               Schedule 2, which office is the place where such Person is
               "located" for the purposes of Section 9-103(3)(d) of the
               Uniform Commercial Code of the State of New York, and the
               offices of each Servicer and the Master Servicer where such
               Servicer and the Master Servicer keeps its records
               concerning the Receivables are also listed in said Schedule. 
               Such Person (i) will not move outside the State listed on
               Schedule 2 under the heading "Chief Executive Office" the
               location of its chief executive office or outside of the
               State listed on Schedule 2 under the heading "Offices Where
               Records Kept" the location of any of the offices where it
               keeps its records with respect to the Receivables without 30
               days' prior written notice to the Administrative Agent and
               (ii) will promptly take all actions reasonably required
               (including but not limited to all filings and other acts
               necessary or advisable under the Uniform Commercial Code of
               each relevant jurisdiction) in order to continue the first
               priority perfected ownership interest of the Banks in all
               Receivables and other Pooled Property now owned or hereafter
               created.  Such Person will give the Administrative Agent
               prompt notice of a change within the State listed on
               Schedule 2 of the location 


<PAGE>

                                                                    63


               of its chief executive office or of a change within the State 
               listed on Schedule 2 of the location of any office where it 
               keeps its records with respect to the Receivables and the other 
               Pooled Property.  

                    (l)  No Adverse Change.  There has not been since the
               date of this Agreement any material adverse change in the
               ability of such Person to perform its obligations under
               Article XII of this Agreement. 

                    (m)  Lockboxes and other Payment Methods.  Listed on
               Schedule 3 is each Lockbox Account to which, as of the
               initial Closing Date, the Obligors have been directed to
               remit payments on account of the Receivables, except to the
               extent that any of the Servicers, in the normal course of
               their business and consistent with past practices, have
               directed such Obligors to remit payments by (i) delivering
               cash, a check or other instrument to or in care of the
               Person delivering goods to such Obligor, (ii) a wire
               transfer of such funds directly to the relevant
               Concentration Account or (iii) delivering a check to the
               business offices, agents or officers of such Servicer. 
               Neither the Master Servicer nor any Servicer shall (i) add
               or terminate any bank as a bank at which a Lockbox Account
               is maintained, (ii) add or terminate any such Lockbox
               Account at any such bank or (iii) make any change in its
               instructions to any Obligor regarding payments to be made to
               any such bank or Lockbox Account; provided, that a Servicer
               may at any time change its instructions to Obligors so as to
               require such Obligors to make payments to a different
               Lockbox Account, so long as such Servicer has previously
               delivered to the Administrative Agent an executed Lockbox
               Agreement in form and substance reasonably satisfactory to
               the Administrative Agent regarding such Lockbox Account.

                    (n)  Reports.  The information with respect to the
               Receivables serviced by such Person contained in each
               Settlement Statement will be true and correct in all
               material respects as of the date of such Settlement
               Statement.

                    (o)  Instruments.  Such Person will not take any action
               to cause any Receivable to be evidenced by any instrument
               (other than an instrument which constitutes chattel paper)
               (as each such term is defined in the Uniform Commercial Code
               as in effect in the State of New York) except in connection
               with the enforcement or collection of a Receivable.

                    (p)  Extension of Receivables; Amendment of Policies.  
               Extend, make any Adjustment to, rescind, cancel, amend or
               otherwise modify, or attempt or purport to extend, amend or
               otherwise modify, the terms of any Purchased Receivables,
               except (i) in accordance with the terms of the Policies and
               the Company Policies, (ii) as required by any Requirement of
               Law, (iii) in the case of Adjustments, upon making an
               Adjustment Payment pursuant to subsection 12.4 or (iv) with
               the consent of the Required Banks, provided the Servicers
               may cause Receivables to become Charge-Offs.  Neither the
               Servicers nor the Master Servicer shall amend or otherwise
               modify or waive any term or condition of the Policies or the
               Company Policies except in accordance with subsection 5.8 of
               the Receivables Sale Agreement.


<PAGE>


                                                                      64



                    (q)  Ineligible Receivables.  Without the prior written
               approval of the Required Banks, such Person shall not take
               any action to cause, or which would permit, an Eligible
               Receivable to cease to be an Eligible Receivable, except as
               expressly permitted in this Agreement.

                    (r)  Notices.  Such Person will give written notice to
               the Administrative Agent and each Bank promptly upon
               obtaining knowledge of (i) the occurrence of any Termination
               Event, Potential Termination Event, Servicer Default or
               Servicer Event of Default (which notice shall specify what,
               if any, action will be taken with respect thereto) and (ii)
               a breach of any of the representations and warranties of the
               Company set forth in Article V.

                    (s)  Financial Statements.  The Master Servicer shall
               furnish to each Bank:

                         (i)  as soon as available, but in any event within
                    90 days after the end of each fiscal year of the Master
                    Servicer, a copy of the consolidated balance sheet of
                    the Master Servicer and its consolidated Subsidiaries
                    as at the end of such year and the related consolidated
                    statements of income, shareholders' equity and retained
                    earnings and cash flows for such year, setting forth
                    the comparative amounts for the previous year and
                    certified without a "going concern" or like
                    qualification or exception, or scope limitation, by
                    Arthur Andersen & Co. or other independent certified
                    public accountants of nationally recognized standing
                    reasonably acceptable to the Administrative Agent; 

                         (ii)  as soon as available, but in any event not
                    later than 45 days after the end of each of the first
                    three quarterly periods of each fiscal year of the
                    Master Servicer, the unaudited consolidated balance
                    sheet of the Master Servicer and its consolidated
                    Subsidiaries as at the end of such quarter and the
                    related unaudited consolidated statements of income,
                    shareholders' equity and retained earnings and cash
                    flows of the Master Servicer and its consolidated
                    Subsidiaries for such quarter and the portion of the
                    fiscal year through the end of such quarter, setting
                    forth the comparative amounts for the corresponding
                    quarter and portion of the previous year, certified by
                    a Responsible Officer of the Master Servicer as being
                    fairly stated in all material respects (subject to
                    normal year-end audit adjustments); and

                         (iii)  as soon as available, but in any event not
                    later than 45 days after the end of each month in each
                    fiscal year of the Master Servicer, the unaudited
                    consolidated balance sheet of the Master Servicer and
                    its consolidated Subsidiaries as at the end of such
                    month and the related unaudited consolidated statements
                    of income, shareholders' equity and retained earnings
                    and cash flows of the Master Servicer and its
                    consolidated Subsidiaries for such month and the
                    portion of the fiscal year through the end of such
                    month, setting forth the comparative amounts for the
                    corresponding month of the previous year, certified by
                    a Responsible Officer of the Master Servicer as being
                    fairly stated in all material respects (subject to
                    normal year-end audit adjustments);


<PAGE>

                                                                      65




               all such financial statements shall be complete and correct
               in all material respects and shall be prepared in reasonable
               detail and in accordance with GAAP applied consistently
               throughout the periods reflected therein and with prior
               periods (except as approved by such accountants or
               Responsible Officer, as the case may be, and disclosed
               therein) except that the monthly financial statements
               provided pursuant to clause (iii) shall only be consistent
               with GAAP in all material respects and that the monthly
               financial statements provided pursuant to clause (iii) shall
               not be required to include footnotes.

                    (t)  Certificates; Other Information.  The Master
               Servicer shall furnish to each Bank:

                         (i)  concurrently with the delivery of the
                    financial statements referred to in clause (s)(i), a
                    certificate of the independent certified public
                    accountants reporting on such financial statements
                    stating that in making the examination necessary
                    therefor no knowledge was obtained of any Servicer
                    Default or Servicer Event of Default, except as
                    specified in such certificate;

                         (ii)  concurrently with the delivery of the
                    financial statements referred to in clause (s)(i) and
                    (ii), a certificate of a Responsible Officer of the
                    Master Servicer stating that, to the best of such
                    Responsible Officer's knowledge, each Transaction Party
                    during such period has observed or performed all of its
                    covenants and other agreements, and satisfied every
                    condition, contained in the Transaction Documents to
                    which it is a party to be observed, performed or
                    satisfied by it, and that such Responsible Officer has
                    obtained no knowledge of any Servicer Default or
                    Servicer Event of Default except as specified in such
                    certificate.

                    (u)  Separate Corporate Existence of the Company.  The
               Master Servicer shall cause the Company to comply with the
               provisions of subsection 7.9.  Neither the Master Servicer
               nor any Servicer shall take any action, or omit to take any
               action, which is inconsistent with the provisions thereof. 
               The Master Servicer shall not assign, pledge, transfer or
               otherwise dispose of the Capital Stock of the Company other
               than pursuant to the terms of the Pledge Agreement.

          Each of the Master Servicer and each Servicer agrees and
          acknowledges that each of the representations and warranties
          contained in this subsection 12.6 shall be deemed to have been
          made by the Master Servicer or such Servicer, as the case may be,
          (x) as of the Effective Date, and (y) with respect to an Increase
          in Net Investment, as of the related Closing Date, unless, in
          either case, such representation or warranty expressly relates
          only to a prior date.



                    12.7  Acquisition Obligation.  (a)  In the event of any
          breach of any of the representations, warranties or covenants of
          the Master Servicer or any Servicer which is an Affiliate of the
          Company contained in subsection 12.6(g), (i), (j), (k), (p) or
          (q), then upon the earlier to occur of the discovery of such
          event by a Responsible Officer of such Person, or receipt by such
          Person of written notice of such event given by the
          Administrative Agent, the outstanding Principal Amount of
          Receivables shall be reduced by the Principal Amount of 


<PAGE>

                                                                         66



          such Receivables in respect of which such representation or warranty
          was incorrect or such covenant was breached; provided, however,
          that (i) prior to the Amortization Period, to the extent that
          such a reduction would cause the Invested Percentage to be more
          than the Maximum Invested Percentage, the Master Servicer and the
          Servicers which are Affiliates of the Company, jointly and
          severally, agree to acquire such Receivable and any Related
          Property with respect thereto on the terms and conditions set
          forth in paragraph (b) below and (ii) during the Amortization
          Period, the Master Servicer and the Servicers which are
          Affiliates of the Company, jointly and severally, agree
          (regardless of which such Servicer or Master Servicer shall have
          been responsible for such breach) to acquire such Receivable and
          any Related Property with respect thereto on the terms and
          conditions set forth in paragraph (b) below.  In the event of any
          breach of any of the representations, warranties or covenants of
          the Master Servicer or any Servicer which is not an Affiliate of
          the Company contained in subsection 12.6(g), (i), (j), (k), (p)
          or (q), then upon the earlier to occur of the discovery of such
          event by such Person, or receipt by such Person of written notice
          of such event given by the Administrative Agent, the outstanding
          Principal Amount of Receivables shall be reduced by the Principal
          Amount of such Receivables in respect of which such
          representation or warranty was incorrect or such covenant was
          breached upon the deposit by the Master Servicer or such Servicer
          (which deposit the Master Servicer or such Servicer hereby agrees
          to make) into the relevant Concentration Account in immediately
          available funds an amount equal to the Principal Amount of such
          Receivable (together with payments pursuant to paragraph (b),
          "Servicer Transfer Payments"). 

                    (b)  If any breach of a representation, warranty or
          covenant by a Servicer or the Master Servicer which is an
          Affiliate of the Company which necessitates the acquisition of a
          Receivable by the Master Servicer and the Servicers pursuant to
          paragraph (a) remains uncured on the day which is 30 days after
          discovery or notice of such breach, the Master Servicer and such
          Servicers shall acquire such Receivable and any Related Property
          with respect thereto by depositing into the relevant
          Concentration Account in immediately available funds on such 30th
          day (or, if such day is not a Business Day, the immediately
          succeeding Business Day, an amount equal to (i) prior to an
          Amortization Period, the lesser of (A) the amount necessary to
          cause the Invested Percentage to equal the Maximum Invested
          Percentage and (B) the Principal Amount of such Receivable or
          (ii) during an Amortization Period, the Principal Amount of such
          Receivable (also, a "Servicer Transfer Payment").  Upon deposit
          of the Servicer Transfer Payment, the Banks shall automatically
          and without further action be deemed to sell, transfer, assign,
          set-over and otherwise convey to such Person, free and clear of
          any Lien created by the Banks but otherwise without recourse,
          representation or warranty, all the right, title and interest of
          the Banks in and to such Receivable, and all Related Property
          with respect thereto; and such retransferred Receivable shall be
          treated by the Banks as collected in full as of the date on which
          it was transferred.  The Administrative Agent shall execute such
          documents and instruments of transfer or assignment and take such
          other actions as shall reasonably be requested by the Master
          Servicer to effect the conveyance of such Receivables pursuant to
          this subsection 12.7.  The obligation to acquire any Receivable
          shall constitute the sole remedy respecting any breach of the
          representations, warranties and covenants set forth in subsection
          12.6(g), (i), (j), (k), (p) or (q) with respect to such
          Receivables available to Banks or the Administrative Agent on
          behalf of the Banks.


<PAGE>

                                                                        67



                    12.8  Obligations Unaffected.  The obligations of the
          Master Servicer, each Servicer and the Company to the
          Administrative Agent and the Banks under this Agreement shall not
          be affected by reason of any invalidity, illegality or
          irregularity of any Receivable or any transfer and assignment of
          a Receivable.

                    12.9  Addition of Servicers.  Subject to the terms and
          conditions hereof, from time to time one or more Subsidiaries of
          C&A Products which the Required Banks have approved as additional
          Sellers pursuant to subsection 8.22 shall become additional
          Servicers parties hereto upon (a) execution by each such
          Subsidiary of an Additional Servicer Supplement and (b)
          satisfaction of all conditions precedent set forth in subsection
          3.4 of the Receivables Sale Agreement to such Subsidiary becoming
          an additional Seller.

                    12.10  Optional Termination of Servicers.  Any Servicer
          which is terminated as a Seller pursuant to subsection 9.15 of
          the Receivables Sale Agreement shall be released as a Servicer
          party hereto and shall cease to be a party hereto on the date it
          ceases to be a party to the Receivables Sale Agreement.

                    12.11  Interest on Overdue Payments.  If any amount
          payable by the Servicers or the Master Servicer to the Banks or
          the Administrative Agent hereunder, whether on account of fees or
          expenses or on account of amounts collected by the Servicers or
          the Master Servicer or amounts payable pursuant to subsection
          12.4 or 12.7, or otherwise, is not paid by such Servicer or the
          Master Servicer, as the case may be, on the relevant Settlement
          Date or other relevant date, such amount shall be payable
          together with interest for each day from such Settlement Date or
          other relevant date, as the case may be, until such amount is
          paid in full at a rate per annum equal to ABR plus the Applicable
          ABR Margin plus 2%.



                    12.12  Servicer Events of Defaults.  If any of the
          following events (herein called "Servicer Events Of Default")
          shall have occurred and be continuing:

                    (a)  any Servicer or the Master Servicer, as the case
               may be, (1) shall fail to deliver any Daily Report or any
               Settlement Statement conforming in all material respects to
               the requirements of subsection 12.5 and such failure shall
               continue unremedied for two consecutive Business Days after
               the Administrative Agent shall have delivered notice thereof
               to such Servicer or the Master Servicer, as the case may be,
               provided that if a Force Majeure Delay shall have occurred
               with respect to any Servicer or the Master Servicer, as the
               case may be, (i) in the case of such an event with respect
               to a Servicer, the failure of any Daily Report or Settlement
               Statement to contain information with respect to the
               Receivables serviced by such Servicer or (ii) in the case of
               such an event with respect to the Master Servicer, the
               failure of the Master Servicer to deliver any Daily Report
               or Settlement Statement, shall not constitute, in either
               case, a Servicer Event of Default unless such failure
               continues for longer than the lesser of (x) ten consecutive
               Business Days and (y) the length of such Force Majeure Delay
               (or, if greater, two Business Days) after the Administrative
               Agent shall have delivered notice of such failure to the
               Company, or (2) shall fail to make any payment reflected in
               such Daily Report or Settlement Statement as being required
               to be made by it thereunder on the date such report or
               statement is delivered;



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                                                                       68



                    (b)  any Servicer or the Master Servicer, as the case
               may be, shall fail to pay any amount required to be paid by
               it hereunder (other than those specified in paragraph (a) of
               this subsection 12.12) within five Business Days after the
               date when due;

                    (c)  any Servicer or the Master Servicer, as the case
               may be, shall fail to observe or perform any covenant or
               agreement applicable to it contained herein (other than as
               specified in subsections (a) and (b) of this subsection
               12.12), provided that, except in the case of any failure to
               observe or perform any covenant contained in subsection
               12.6(r)(i), no such failure shall constitute a Servicer
               Event of Default under this paragraph (c) unless such
               failure shall continue unremedied for a period of 30
               consecutive days after notice thereof from the
               Administrative Agent, the Required Banks or the Company;
               provided that a Servicer Event of Default shall not be
               deemed to have occurred under this paragraph (c) based upon
               a breach of a representation, warranty or covenant contained
               in subsection 12.6(g), (i), (j), (k), (p) or (q) if the
               Servicers and Master Servicer shall have complied with the
               provisions of subsection 12.7 with respect thereto; 




                    (d)  any representation, warranty, certification or
               statement made or deemed made by any Servicer or the Master
               Servicer, as the case may be, in this Agreement or in any
               Settlement Statement or other certificate, financial
               statement or other document delivered pursuant to this
               Agreement shall prove to have been false or misleading in
               any material respect on or as of the date made or deemed
               made; provided that a Servicer Event of Default shall not be
               deemed to have occurred under this paragraph (d) based upon
               a breach of a representation, warranty or covenant contained
               in subsection 12.6(g), (i), (j), (k), (p) or (q) if the
               Servicers and Master Servicer shall have complied with the
               provisions of subsection 12.7 with respect thereto; 

                    (e)  (i) an involuntary proceeding shall be commenced
               or an involuntary petition shall be filed in a court of
               competent jurisdiction seeking (A) relief in respect of any
               Servicer or the Master Servicer, as the case may be, or of a
               substantial part of its property or assets, under Title 11
               of the United States Code, as now constituted or hereafter
               amended, or any other Federal, state or foreign bankruptcy,
               insolvency, receivership or similar law, (B) the appointment
               of a receiver, trustee, custodian, sequestrator, conservator
               or similar official for the any Servicer or the Master
               Servicer, as the case may be, or for a substantial part of
               its property or assets or (C) the winding-up or liquidation
               of the any Servicer or the Master Servicer, as the case may
               be; and such proceeding or petition shall continue
               undismissed for 60 days or an order or decree approving or
               ordering any of the foregoing shall be entered; or (ii) any
               Servicer or the Master Servicer, as the case may be, shall
               (A) voluntarily commence any proceeding or file any petition
               seeking relief under Title 11 of the United States Code, as
               now constituted or hereafter amended, or any other Federal,
               state or foreign bankruptcy, insolvency, receivership or
               similar law, (B) consent to the institution of, or fail to
               contest in a timely and appropriate manner, any proceeding
               or the filing of any petition described in clause (i) above,
               (C) apply for or consent to the appointment of a receiver,
               trustee, custodian, sequestrator, conservator or similar
               official for such Servicer or the Master Servicer, as the
               case may be, or for a substantial part of its 



<PAGE>

                                                                    69




               property or assets, (D) file an answer admitting the material
               allegations of a petition filed against it in any such
               proceeding, (E) make a general assignment for the benefit of
               creditors, (F) become unable, admit in writing its inability
               or fail generally to pay its debts as they become due or (G)
               take any action for the purpose of effecting any of the
               foregoing; or

                    (f)  a Purchase Termination Event shall have occurred
               and be continuing under the Receivables Sale Agreement;

          then, in any such event, so long as such Servicer Event of
          Default shall be continuing, with the consent of the Required
          Banks the Administrative Agent or the Company may, or upon the
          request of the Required Banks the Administrative Agent or the
          Company shall, terminate the rights of any or all of the
          Servicers and the Master Servicer in accordance with subsection
          12.2(d) by notice to each such Servicer and/or the Master
          Servicer, as the case may be. 

                    12.13  Audit.  Upon the earlier of (a) the date which
          is 270 days after the Effective Date and (b) the date on which
          C&A Products shall have determined not to pursue the replacement
          or refinancing, in whole, of this Agreement and the other
          Transaction Documents with a Replacement Facility, the
          Administrative Agent, at the expense of C&A Products, may select
          and engage a third party to audit the Receivables and all
          computer programs, material and data of the Sellers required for
          the collection of Receivables by the Company.  C&A Products
          hereby agrees to give the Administrative Agent prompt written
          notice of any determination referred to in clause (b) of the
          preceding sentence.



<PAGE>


                                                                         70




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



                                   CARCORP, INC.


                                   By: Mark O. Remissong                   
                                      Title:  Senior Vice President



                                   COLLINS & AIKMAN PRODUCTS CO.,
                                     as Master Servicer


                                   By: Mark O. Remissong                   
                                      Title:  Senior Vice President

                                   Address for Notices:
                                   701 McCullough Drive
                                   Charlotte, North Carolina  28262
                                   Attention:  Chief Financial Officer
                                   Telecopy:  704-548-2330



                                   CHEMICAL BANK, as Administrative Agent
                                   and as a          Bank


                                   By: Suzanne Kjorlien                     
                                    
                                      Title: Vice President




<PAGE>


                                                                        71




                                   The Servicers:


                                   COLLINS & AIKMAN PRODUCTS CO., as
                                   Servicer for itself and for Ack-Ti-
                                   Lining, Inc. and The Akro Corporation

                                   By: Mark O. Remissong                   
                                      Title: Senior Vice President


                                   DURA ACQUISITION CORP.

                                   By: Mark O. Remissong                   
                                      Title: Senior Vice President


                                   IMPERIAL WALLCOVERINGS, INC.

                                   By: Mark O. Remissong                   
                                      Title: Senior Vice President


                                   IMPERIAL WALLCOVERINGS (CANADA), INC.

                                   By: Mark O. Remissong                   

                                      Title: Senior Vice President


                                   WCA CANADA, INC.

                                   By: Mark O. Remissong                   

                                      Title: Senior Vice President

                                   Address for Notices for all Servicers:
                                   c/o Collins & Aikman Products Co.
                                   701 McCullough Drive
                                   Charlotte, North Carolina  28262
                                   Attention:  Chief Financial Officer
                                   Telecopy:  704-548-2330



<PAGE>




                                      SCHEDULE 1

                      NAMES, ADDRESSES AND COMMITMENTS OF BANKS



                                                               Commitment

          CHEMICAL BANK . . . . . . . . . . . . . . . . . . .  $150,000,000
          270 Park Avenue
          New York, New York 10017
          Attention:
          Telecopy No.:




<PAGE>



                                                              SCHEDULE 2





                                   State of
                                   Incorporat
       Seller                      ion          Location of Chief Executive Office      Office Where Records are Kept


                                                                              
       Carcorp, Inc.               Delaware     5025 S. Eastern Avenue, Suite 16, No.   5025 S. Eastern Avenue, Suite 16, No.
                                                25, Las Vegas, NV       89119           25, Las Vegas, NV        89119

       Collins & Aikman Products   Delaware     701 McCullough Drive, Charlotte, NC     701 McCullough Drive, Charlotte, NC
       Co.                                      28262                                   28262

       Dura Acquisition Corp.      Delaware     1365 East Beecher Street, Adrian, MI    1365 East Beecher Street, Adrian, MI 
                                                49221                                   49221

       Imperial Wallcoverings,     Delaware     23645 Mercantile Road, Beachwood, OH    23645 Mercantile Road, Beachwood, OH 
       Inc.                                     44122                                   44122

       Imperial Wallcoverings      Ontario      1051 Rue Galt Est, Sherbrooke, Quebec,  1051 Rue Galt Est, Sherbrooke, Quebec,
       (Canada), Inc.                           Canada  J1G 1Y7                         Canada, J1G 1Y7

       WCA Canada, Inc.            Ontario      150 Collins Street, Farnham, Quebec,    150 Collins Street, Farnham, Quebec,
                                                Canada, J2N 2R6                         Canada, J2N 2R6





<PAGE>



                                              SCHEDULE 3

                                               LOCKBOXES



                                                                 Account No.
                  Seller                       Bank              (including
                                                                 Lockbox No.)
                                                                       
          Collins & Aikman Products
          Co.

          Dura Acquisition Corp.

          Imperial Wallcoverings,
          Inc.

          Imperial Wallcoverings
          (Canada), Inc.

          WCA Canada, Inc.




<PAGE>



                                SCHEDULE 4

                       TRANSACTIONS WITH AFFILIATES



1.    The Company may become a party to a Tax Sharing Agreement among Collins
      & Aikman Corporation, a Delaware corporation ("Parent"), C&A Products
      and other subsidiaries of Parent and C&A Products.

2.    The Company may, from time to time, make payments to C&A Products in the
      form of intercompany loans to the extent, if any, that the payment of
      the amounts so loaned would be permitted as Restricted Payments if paid
      to C&A Products in the form of a dividend or other distribution with
      respect to the Capital Stock of the Company.





<PAGE>




                            SCHEDULE 5

                     CONTRACTUAL OBLIGATIONS



See the agreements set forth as part of Schedule 4.



<PAGE>




                                 SCHEDULE 6

                                LOCAL COUNSEL


  State                               Counsel

Michigan                            Honigman Miller Schwartz and Cohn

Nevada                              Lionel, Sawyer & Collins

North Carolina                      Fennesbresque, Clark, Swindell & Hay

Ohio                                Baker & Hostetler




<PAGE>



                                                           EXHIBIT A TO THE
                                             RECEIVABLES TRANSFER AGREEMENT






                         [FORM OF ASSIGNMENT AND ACCEPTANCE]


               Reference is made to the Receivables Transfer and Servicing
          Agreement, dated as of July 13, 1994 (as amended, supplemented or
          otherwise modified from time to time, the "Receivables Transfer
          Agreement"), among Carcorp, Inc., a Delaware corporation (the
          "Company"), COLLINS & AIKMAN PRODUCTS CO., a Delaware corporation
          ("C&A Products"), as master servicer (in such capacity, the
          "Master Servicer"), C&A Products and certain subsidiaries of C&A
          Products in their capacities as servicers of receivables (in such
          capacities, the "Servicers"), the several financial institutions
          from time to time parties thereto (the "Banks") and Chemical
          Bank, a New York banking corporation, as administrative agent for
          the Banks (in such capacity, the "Administrative Agent").  Unless
          otherwise defined herein, terms defined in the Receivables
          Transfer Agreement and used herein shall have the meanings given
          to them in the Receivables Transfer Agreement.


                                    (the "Transferor Bank") and             
                  (the "Acquiring Bank") agree as follows:

               1.  The Transferor Bank hereby irrevocably sells and assigns
          to the Acquiring Bank without recourse to the Transferor Bank,
          and the Acquiring Bank hereby irrevocably purchases and assumes
          from the Transferor Bank without recourse to the Transferor Bank,
          as of the Transfer Date (as defined below), a ___% interest (the
          "Assigned Interest") in and to the Transferor Bank's rights and
          obligations under the Receivables Transfer Agreement with respect
          to the Participating Interests under the Receivables Transfer
          Agreement as are set forth on SCHEDULE 1 hereto, in a principal
          amount for such Assigned Interest as set forth on SCHEDULE 1
          hereto.

               2.  The Transferor Bank (a) makes no representation or
          warranty and assumes no responsibility with respect to any
          statements, warranties or representations made in or in
          connection with the Receivables Transfer Agreement or any other
          instrument or document furnished pursuant thereto or the
          execution, legality, validity, enforceability, genuineness,
          sufficiency or value of the Receivables Transfer Agreement or any
          other instrument or document furnished pursuant thereto, other
          than that it has not created any adverse claim upon the interest
          being assigned by it hereunder and that such interest is free and
          clear of any such adverse claim; and (b) makes no representation
          or warranty and assumes no responsibility with respect to the
          financial condition of the Company, C&A Products, any of the
          Sellers or any of the Obligors under the Receivables or the
          performance or observance by the Company, C&A Products, such
          Sellers or such Obligors of any of their respective obligations
          under the Receivables Transfer 


<PAGE>

                                                                      2


          Agreement, the Receivables or any
          other instrument or document furnished pursuant thereto.

               3.  The Acquiring Bank (a) represents and warrants that it
          is legally authorized to enter into this Assignment and
          Acceptance; (b) confirms that it has received a copy of the
          Receivables Transfer Agreement, together with copies of the most
          recent financial statements delivered pursuant to Section 7.1
          thereof, copies of the other Transaction Documents and such other
          documents and information as it has deemed appropriate to make
          its own credit analysis and decision to enter into this
          Assignment and Acceptance; (c) agrees that it will, independently
          and without reliance upon the Transferor Bank, the Administrative
          Agent or any other Bank and based on such documents and
          information as it shall deem appropriate at the time, continue to
          make its own credit decisions in taking or not taking action
          under the Receivables Transfer Agreement or any other instrument
          or document furnished pursuant thereto; (d) appoints and
          authorizes the Administrative Agent to take such action as agent
          on its behalf and to exercise such powers and discretion under
          the Receivables Transfer Agreement, the other Transaction
          Documents or any other instrument or document furnished pursuant
          thereto as are delegated to the Administrative Agent by the terms
          thereof, together with such powers as are incidental thereto; and
          (e) agrees that it will be bound by the provisions of the
          Receivables Transfer Agreement and will perform in accordance
          with its terms all the obligations which by the terms of the
          Receivables Transfer Agreement are required to be performed by it
          as a Bank including, if it is organized under the laws of a
          jurisdiction outside the United States, its obligation pursuant
          to Section 3.5 of the Receivables Transfer Agreement.

               4.  The effective date of this Assignment and Acceptance
          shall be               , 19   (the "Transfer Date").  Following
          the execution of this Assignment and Acceptance by the parties
          hereto (including, if the Acquiring Bank is not then a Bank or a
          Lender (as defined in the Credit Agreement) or an affiliate
          thereof, by the Company), it will be delivered, together with the
          payment to the Administrative Agent of a registration and
          processing fee of $3,500, to the Administrative Agent for
          acceptance by it and recording by the Administrative Agent
          pursuant to Section 11.4(e) of the Receivables Transfer
          Agreement, effective as of the Transfer Date (which shall not,
          unless otherwise agreed to by the Administrative Agent, be
          earlier than five Business Days after the date of such acceptance
          and recording by the Administrative Agent).

               5.  Upon such acceptance and recording, from and after the
          Transfer Date, the Administrative Agent shall make all payments
          in respect of the Assigned Interest (including payments of
          principal, Commitment Fees and other amounts) to the Acquiring
          Bank whether such amounts have accrued prior to the Transfer Date
          or accrue subsequent to the Transfer Date.  The Transferor Bank
          and the Acquiring Bank shall make all appropriate adjustments in
          payments by the Administrative Agent for periods prior to the
          Effective Date 


<PAGE>

                                                                        3



          or with respect to the making of this assignment
          directly between themselves.

               6.  From and after the Transfer Date, (a) the Acquiring Bank
          shall be a party to the Receivables Transfer Agreement and, to
          the extent provided in this Assignment and Acceptance, have the
          rights and obligations of a Bank thereunder and shall be bound by
          the provisions thereof and (b) the Transferor Bank shall, to the
          extent provided in this Assignment and Acceptance, relinquish its
          rights and be released from its obligations under the Receivables
          Transfer Agreement.

               7.  THIS ASSIGNMENT AND ACCEPTANCE SHALL BE GOVERNED BY, AND
          CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE
          STATE OF NEW YORK.

               IN WITNESS WHEREOF, the parties hereto have caused this
          Assignment and Acceptance to be executed as of the date first
          above written by their respective duly authorized officers on
          Schedule 1 hereto.



<PAGE>




                                      SCHEDULE 1
                             TO ASSIGNMENT AND ACCEPTANCE
                   RELATING TO THE RECEIVABLES TRANSFER AGREEMENT,
                           DATED AS OF JULY 13, 1994, AMONG
                                    CARCORP, INC.,
                            COLLINS & AIKMAN PRODUCTS CO.,
                CERTAIN SUBSIDIARIES OF COLLINS & AIKMAN PRODUCTS CO.,
                             THE BANKS NAMED THEREIN AND
                 CHEMICAL BANK, AS ADMINISTRATIVE AGENT FOR THE BANKS

          Name of Transferor Bank:

          Name of Acquiring Bank:

          Transfer Date of Assignment:
              Commitment         Principal        Commitment Percentage
               Assigned       Amount Assigned           Assigned
                                             
             $____________     $_____________          __._________%


           [Name of Acquiring Bank]        [Name of Transferor Bank]



           By:______________________       By:_______________________
              Title:                          Title:

           Address for Notices:
           [Address]
           Attention:
           Telephone:
           Telecopier:



           [Consented To:]

           CHEMICAL BANK, as               CARCORP, INC.
             Administrative Agent


           By:_____________________        By:_______________________
              Title:                          Title:



          Accepted for Recordation in the Register:

          CHEMICAL BANK, as
            Administrative Agent


          By:_____________________
             Title:



<PAGE>





                                                           EXHIBIT B TO THE
                                             RECEIVABLES TRANSFER AGREEMENT



                             [FORM OF LOCKBOX AGREEMENT]


                                                          ________ __, 1994


          [Name and address of Lockbox Bank]
          ________________________
          ________________________

          Attention: _________________

          Dear Sirs:

                    Carcorp, Inc., a Delaware corporation (the "Company"),
          has agreed to purchase certain receivables (the "Receivables")
          from a number of sellers (the "Sellers") pursuant to the
          Receivables Sale Agreement, dated as of July 13, 1994, among the
          Sellers, Collins & Aikman Products Co., as master servicer of the
          receivables (in such capacity, the "Master Servicer") and the
          Company.  The Company has in turn sold the Receivables to the
          several financial institutions (the "Banks") from time to time
          parties to the Receivables Transfer and Servicing Agreement,
          dated as of July 13, 1994 (as amended, supplemented or otherwise
          modified from time to time, the "Receivables Transfer
          Agreement"), among the Company, the Master Servicer, certain of
          the Sellers, as servicer in respect of its related receivables
          (each, in such capacity, a "Servicer"), the Banks and Chemical
          Bank, as administrative agent for the Banks (in such capacity,
          the "Administrative Agent").  Capitalized terms used herein but
          not defined herein shall have the meanings assigned to such terms
          in Annex X to the Receivables Transfer Agreement.

                    Pursuant to the terms of the Receivables Transfer
          Agreement and except as otherwise provided therein, (i) each of
          the Servicers has agreed to instruct all Obligors under the
          Receivables to make all payments in respect of the Receivables to
          a blocked deposit account (each, a "Lockbox Account") designated
          by such Servicer to such Obligor and (ii) the Company has agreed
          to grant a security interest in its right, title and interest in
          each Lockbox Account and all funds and other evidences of payment
          held therein to the Banks.  Furthermore, the Company, the
          Servicers, the Master Servicer and the Administrative Agent have
          agreed, pursuant to the Receivables Transfer Agreement, to enter
          into an agreement with each bank maintaining a Lockbox Account
          and hereby request that [Name of Lockbox Bank] (the "Lockbox
          Bank") act as, and the Lockbox Bank hereby agrees to act as, a
          lockbox deposit bank for the Company with respect to the Lockbox
          Account.  This Letter Agreement defines certain rights and
          obligations with respect to the appointment of the Lockbox Bank.



<PAGE>



                                                                          2

                    Accordingly, the Company, the Master Servicer, on
          behalf of itself and the Servicers, the Servicer party hereto,
          the Administrative Agent and the Lockbox Bank agree as follows:

                    Reference is made to the Lockbox Account (Account No.
          ______), including box number ______ thereunder, maintained with
          you by the related Servicer.  The related Servicer hereby
          transfers the Lockbox Account to the Company and hereafter the
          Lockbox Account shall be maintained by the Lockbox Bank for the
          benefit of the Company and the Administrative Agent, as set forth
          herein.  All funds and other evidences of payment received by the
          Lockbox Bank in its capacity as Lockbox Bank in respect of the
          Receivables shall be deposited in the Lockbox Account.  Such
          payments shall not be commingled with other funds.  All funds and
          other evidences of payment at any time on deposit in the Lockbox
          Account shall be held by the Lockbox Bank for application
          strictly in accordance with the terms of this Letter Agreement. 
          The Lockbox Bank agrees to give the Administrative Agent prompt
          notice if the Lockbox Account shall become subject to any writ,
          judgment, warrant of attachment, execution or similar process.

                    The Administrative Agent shall have the sole and
          exclusive dominion over and control of the Lockbox Account and
          all Collections and other property from time to time deposited
          therein, and shall have the sole right of withdrawal from the
          Lockbox Account.  Each of the Company and the Master Servicer
          acknowledges and agrees that neither it nor any Servicer shall
          have any dominion over or control of the Lockbox Account or any
          Collections or other property from time to time deposited therein
          including any right to withdraw or utilize any funds or other
          evidences of payment on deposit in the Lockbox Account, other
          than the right to authorize transfers to the Concentration
          Account (as defined below) as set forth herein and pursuant to
          the terms of the Receivables Transfer Agreement.  The Company or
          the Administrative Agent shall initiate and the Lockbox Bank
          shall permit, at least as often as once each day that is a
          business day for the Lockbox Bank and for Chemical Bank (in such
          capacity, the "Concentration Bank" or the "Collection Bank", as
          the context requires), and in any event by 1:00 p.m., New York
          time, on the Business Day following each such day, the transfer,
          by means of the Automated Clearing House System, of all available
          funds on deposit in the Lockbox Account, including all funds
          transferred from Obligors on or before the end of such day, along
          with, subject to the next succeeding sentence, all remittance
          advisements and payment invoices on deposit therein, to the
          deposit account (Account No. _________), maintained in the name
          of the Administrative Agent at the Concentration Bank (the
          "Concentration Account").  The Lockbox Bank acknowledges that,
          until it receives instructions from the Administrative Agent to
          the contrary, the Lockbox Bank shall return to the Company, upon
          the Company's reasonable request therefor, any remittance
          advisements and payment invoices deposited into the Lockbox
          Account.


<PAGE>



                                                                          3

                    As soon as practicable following (and in any event not
          later than the day following) receipt of written notice from the
          Administrative Agent and thereafter, the Lockbox Bank shall
          transfer automatically at least as often as once each day that is
          a business day for the Lockbox Bank and for the Concentration
          Bank, as the case may be, and in any event at the open of
          business on the Business Day following each such day of deposit,
          by means of the Automated Clearing House System, all available
          funds on deposit in the Lockbox Account to the Concentration
          Account, as provided in such notice, along with any remittance
          advisements and payment invoices on deposit therein.  Any such
          instructions may be revoked only upon written notice from the
          Administrative Agent.

                    Deposited checks with respect to the Lockbox Account
          returned to the Lockbox Bank for any reason will be charged
          against the Lockbox Account.  Nothing contained in the previous
          sentence shall be construed to prejudice other rights of the
          Lockbox Bank, which rights include the right of recourse against
          the Company for any overdrafts in the Lockbox Account.

                    The Administrative Agent is authorized to receive mail
          delivered to the Lockbox Bank with respect to the Lockbox Account
          and the Company has filed a form of standing delivery order with
          the United States Postal Service authorizing the Administrative
          Agent to receive mail delivered to the Lockbox Bank with respect
          to the Lockbox Account.

                    The Lockbox Bank shall also furnish the Administrative
          Agent with statements, in the form and manner typical for the
          Lockbox Bank, of amounts of deposits in, and amounts transferred
          to the Concentration Account from, the Lockbox Account pursuant
          to any reasonable request of the Administrative Agent but in any
          event not less frequently than monthly and such other information
          relating to the Lockbox Account at such times as shall be
          reasonably requested by the Administrative Agent.

                    For purposes of this Letter Agreement, any officer of
          the Administrative Agent shall be authorized to act, and to give
          instructions and notice, on behalf of the Administrative Agent
          hereunder.

                    The fees for the services of the Lockbox Bank shall be
          mutually agreed upon between the Company and the Lockbox Bank and
          paid by the Company.  Such fees shall not be paid by means of the
          withdrawal of funds from the Lockbox Account.  Neither the
          Administrative Agent nor any Bank shall have any responsibility
          or liability for the payment of any such fee.

                    The Lockbox Bank may perform any of its duties
          hereunder by or through its officers, employees or agents and
          shall be entitled to rely upon the advice of counsel as to its
          duties.  The Lockbox Bank shall not be liable to the
          Administrative Agent, the Master Servicer, any Servicer or the


<PAGE>


                                                                          4

          Company for any action taken or omitted to be taken by it in good
          faith, nor shall the Lockbox Bank be responsible to the
          Administrative Agent, the Master Servicer, any Servicer or the
          Company for the consequences of any oversight or error of
          judgment or be answerable to the Administrative Agent for the
          same unless the same shall happen through the Lockbox Bank's
          gross negligence or willful misconduct.

                     The Lockbox Bank may resign at any time as Lockbox
          Bank hereunder by delivery to the Administrative Agent and the
          Company of written notice of resignation not less than 10 days
          prior to the effective date of such resignation.  The Company
          may, with the written consent of the Administrative Agent, and,
          if the Company shall refuse any demand by the Administrative
          Agent to do so in the event (i) a Termination Event shall occur
          and be continuing or (ii) there has been a failure by the Lockbox
          Bank to perform any of its material obligations hereunder and
          such failure could materially adversely affect the Banks'
          interest in any Receivable or the Administrative Agent's rights,
          or ability to exercise any remedies, under this Letter Agreement
          or the Receivables Transfer Agreement, the Administrative Agent
          may close the Lockbox Account at any time by delivery of notice
          to the Lockbox Bank and the Company at the addresses appearing
          below.  This Letter Agreement shall terminate upon receipt of
          such notice of closing, or delivery of such notice of
          resignation, except that the Lockbox Bank shall immediately
          transfer to the Concentration Account, or any other account
          designated by the Administrative Agent all available funds or,
          subject to the Company's reasonable request to retain such items,
          any remittances advises or payment invoices, if any, then on
          deposit in, or otherwise to the credit of, the Lockbox Account
          and deliver any available funds or such remittance advises or
          payment invoices relating to the Receivables received by the
          Lockbox Bank after such notice directly to the Concentration
          Account or any other account designated by the Administrative
          Agent.

                    Each of the Company, the Master Servicer and the
          Servicers acknowledges that the Lockbox Bank shall incur no
          liability to the Company, the Master Servicer or such Servicer as
          a result of any action taken pursuant to an instruction given by
          or on behalf of the Administrative Agent.

                    All notices and communications hereunder shall be in
          writing (except where telephonic instructions or notices are
          authorized herein) and shall be deemed to have been received and
          shall be effective on the day on which delivered (including
          delivery by telex) (i) in the case of the Administrative Agent,
          to it at 270 Park Avenue (___ Floor), New York, New York 10017,
          Attention: ______________ (Telecopy No. (212) ___-____), (ii) in
          the case of the Lockbox Bank, to it at _______________,
          ________________, Attention: __________ (Telecopy No. (___) ___-
          ____), (iii) in the case of the Company, to it at
          __________________, _________________, Attention: __________



<PAGE>


                                                                          5

          (Telecopy No. (___) ___-___), (iv) in the case of the Master
          Servicer, c/o Collins & Aikman Products Co., _____________,
          Attention: ___________ (Telecopy No. (___) ___-____), and (v) in
          the case of the Servicer party hereto, to it at _______________,
          ________________, Attention: __________ (Telecopy No. (___) ___-
          ____).

                    The Lockbox Bank shall not assign or transfer any of
          its rights or obligations hereunder (other than to the
          Administrative Agent) without the prior written consent of the
          Administrative Agent.  This Letter Agreement may be amended only
          by a written instrument executed by the Company, the Master
          Servicer, the Servicer party hereto, the Administrative Agent and
          the Lockbox Bank, acting by their representative officers
          thereunto duly authorized.  Except with respect to rights of
          setoff available to the Lockbox Bank in the event that it is also
          a Bank under the Receivables Transfer Agreement, the Lockbox Bank
          hereby unconditionally and irrevocably waives (so long as the
          Receivables Transfer Agreement is in effect) any rights of setoff
          or banker's lien against, or to otherwise deduct from, any funds
          or other evidences of payment held in any Lockbox Account for any
          indebtedness or other claim owed by the Company, the Master
          Servicer or any Servicer to the Lockbox Bank.

                    THIS LETTER AGREEMENT SHALL BE GOVERNED BY, AND
          CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE
          STATE OF NEW YORK, EXCEPT TO THE EXTENT THAT THE VALIDITY OR
          PERFECTION OF THE SECURITY INTEREST OR REMEDIES HEREUNDER IN
          RESPECT OF ANY PARTICULAR RECEIVABLE MAY BE GOVERNED BY THE LAW
          OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.

                    This Letter Agreement (i) shall inure to the benefit
          of, and be binding upon, the Company, the Servicers, the Master
          Servicer, the Administrative Agent, the Lockbox Bank and their
          respective successors and assigns and (ii) may be executed in two
          or more counterparts, each of which shall be deemed an original
          but all of which together shall constitute one and the same
          instrument.  Delivery of an executed counterpart of a signature
          page to this Letter Agreement by facsimile transmission shall be
          effective as delivery of a manually executed counterpart of this
          Letter Agreement.


<PAGE>



                                                                          6

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


                                        Very truly yours,

                                        CARCORP, INC.

                                        By:__________________________
                                           Title:

                                        COLLINS & AIKMAN PRODUCTS CO., as
                                         Master Servicer and on behalf of
                                         the Servicers

                                        By:__________________________
                                           Title:

                                        [Servicer] 

                                        By:__________________________
                                           Title:

          Agreed to and accepted:

          [NAME OF LOCKBOX BANK],
           as Lockbox Bank

          By:________________________
             Title:

          CHEMICAL BANK,
           as Administrative Agent

          By:__________________________
             Title:




<PAGE>





                                                           EXHIBIT C TO THE
                                             RECEIVABLES TRANSFER AGREEMENT

                          [FORM OF SUBORDINATION AGREEMENT]

                    SUBORDINATION AGREEMENT, dated as of July 13, 1994,
          among CARCORP, INC., a Delaware corporation (the "Company"),
          COLLINS & AIKMAN PRODUCTS CO., a Delaware corporation ("C&A
          Products"), and the subsidiaries of the C&A Products from time to
          time parties hereto (together with C&A Products, collectively,
          the "Sellers") and CHEMICAL BANK, a New York banking corporation,
          as administrative agent under the Receivables Transfer Agreement
          referred to below (in such capacity, the "Administrative Agent").


                                 W I T N E S S E T H:


                    WHEREAS, the Banks (as defined below) have agreed to
          make purchases from the Company of undivided interests in the
          Receivables (as defined below) on the terms and subject to the
          conditions set forth in the Receivables Transfer Agreement; and

                    WHEREAS, the obligations of the Banks to make purchases
          under the Receivables Transfer Agreement are conditioned on,
          among other things, the execution and delivery by the Company and
          the Sellers of an agreement in the form hereof.

                    NOW THEREFORE, in consideration of the premises and of
          the mutual covenants herein contained, the parties hereto agree
          as follows:


                                      ARTICLE I

                              DEFINITIONS; CONSTRUCTION

                    1.1.  Definitions; Construction.  (a)  Capitalized
          terms used herein and not defined herein shall have the meanings
          assigned to such terms in the Receivables Transfer and Servicing
          Agreement, dated as of July 13, 1994 (as amended, supplemented or
          otherwise modified from time to time, the "Receivables Transfer
          Agreement"), among the Company, the C&A Products, as master
          servicer (in such capacity, the "Master Servicer"), certain
          Sellers in their capacities as servicers (in such capacities, the
          "Servicers"), the several financial institutions from time to
          time parties thereto (the "Banks") and the Administrative Agent. 
          Unless otherwise defined herein or in the Receivables Transfer
          Agreement, terms used in Article 9 of the Uniform Commercial Code
          of the State of New York are used herein as defined therein.  For
          all purposes of this Agreement, the following terms shall have
          the following meanings:

                    "Agreement" shall mean this Subordination Agreement as
          it may from time to time be amended, supplemented or otherwise
          modified in accordance with its terms.


<PAGE>



                                                                          2

                    "Senior Obligations" shall mean the obligations (other
          than obligations of the Company to any Seller or to any Affiliate
          of the Company or any Seller) of the Company now or hereafter
          existing, and all Banks' rights to receive payment, under the
          Receivables Transfer Agreement, whether for the payment of
          principal, Purchase Discount Amount, Commitment Fees, other fees,
          expenses or otherwise and any Monthly Servicing Fee.

                    "Senior Parties" shall mean the Administrative Agent,
          the Banks, the Master Servicer in its capacity as such and the
          Servicers in their capacities as such.

                    "Subordinated Debt" shall mean any obligations payable
          from time to time by the Company to any of the Sellers under the
          Subordinated Notes (and any extensions, renewals, refinancing,
          refundings and replacements of all or any part of such
          obligations).

                    "Subordinated Parties" shall mean the Sellers, as
          holders of the Subordinated Notes.

                    (b)  The definitions referred to or set forth in this
          Article I shall apply equally to both the singular and plural
          forms of the terms defined.  Whenever the context may require,
          any pronoun shall include the corresponding masculine, feminine
          and neuter forms.  The words "include", "includes" and
          "including" shall be deemed to be followed by the phrase "without
          limitation".  All references herein to Articles and Sections
          shall be deemed references to Articles and Sections of this
          Agreement unless the context shall otherwise require.  Except as
          otherwise expressly provided herein, all terms of an accounting
          or financial nature shall be construed in accordance with GAAP.


                                      ARTICLE II

                                    SUBORDINATION

                    2.1.  Subordination.  (a)  In consideration for the
          entry by the Banks into the Receivables Transfer Agreement and
          the other agreements to be delivered in connection therewith,
          each of the Subordinated Parties hereby agrees that all rights of
          such Subordinated Party to payments of principal and interest and
          any other amounts in respect of the Subordinated Debt are hereby
          expressly subordinated, to the extent and in the manner set forth
          in this Article II, to the prior payment in full in cash of all
          Senior Obligations in accordance with the terms thereof.

                    (b)  Except as set forth in subsection 2.7 of the
          Receivables Transfer Agreement, no payment (whether directly or
          indirectly, by exercise of any right of set-off or otherwise) in
          respect of the Subordinated Debt, whether as principal, interest
          or otherwise, shall be made by the Company or received or
          accepted, directly or indirectly, by or on behalf of any


<PAGE>



                                                                          3

          Subordinated Party or any of its Affiliates unless and until all
          amounts (including Purchase Discount Amount accruing after the
          commencement of any proceeding under any bankruptcy, insolvency,
          receivership or similar law, regardless of whether a claim
          therefor is allowable as a claim in such proceeding), however
          denominated, payable to the Senior Parties in respect of the
          Senior Obligations have been paid in full in cash and received by
          the Senior Parties in cash.

                    2.2.  Dissolution or Insolvency.  Upon any distribution
          of all or any of the assets of the Company or upon any
          dissolution, winding up, total or partial liquidation,
          reorganization, adjustment, protection, relief or composition of
          the Company or its debts, whether in bankruptcy, insolvency,
          reorganization, arrangement or receivership proceedings or
          otherwise, or upon any assignment for the benefit of creditors or
          any other marshalling of the assets and liabilities of the
          Company, or otherwise:

                    (a)  the Senior Parties shall first be entitled to
               receive payment in full in cash of the Senior Obligations in
               accordance with the terms of the Senior Obligations
               (whenever arising) before any Subordinated Party shall be
               entitled to receive any payment on account of any
               Subordinated Debt, whether of principal, interest or
               otherwise; and

                    (b)  any payment or distribution of any kind (including
               cash, property, securities and any payment or distribution
               which may be payable or deliverable by reason of the payment
               of any other Indebtedness of the Company being subordinated
               to the payment of the Subordinated Debt) in respect of the
               Subordinated Debt that otherwise would be payable or
               deliverable upon or with respect to the Subordinated Debt,
               directly or indirectly, by set-off or in any other manner,
               including from or by way of collateral, shall be paid or
               delivered by the Person making such payment or delivery
               (whether a trustee in bankruptcy, a receiver, custodian or
               liquidating trustee or otherwise) directly to the
               Administrative Agent on behalf of the Banks for application
               (in the case of cash) to, or as collateral (in the case of
               noncash property or securities) for, the payment of the
               Senior Obligations until the Senior Obligations shall have
               been paid in full in cash.

                    2.3.  Certain Termination Events.  In the event of any
          Termination Event under paragraph (f) of Article IX of the
          Receivables Transfer Agreement arising in respect of the Company:

                    (a)  the Administrative Agent, on behalf of the Banks,
          is hereby irrevocably authorized and empowered (in its own name
          or in the name of the Subordinated Parties or otherwise), but
          shall have no obligation, to demand, sue for, collect and receive
          every payment or distribution of any kind (including cash,



<PAGE>


                                                                          4

          property or securities) made in respect of the Subordinated Debt
          and in connection with any Termination Event referred to in this
          subsection 2.3, and give acquittance therefor and to file claims
          and proofs of claim and take such other action (including
          enforcing any security interest or other lien securing payment of
          the Subordinated Debt) as the Administrative Agent, on behalf of
          the Banks, may deem necessary or advisable for the exercise or
          enforcement of any of the rights or interests of holders of
          Senior Obligations hereunder, provided that in the event the
          Administrative Agent, on behalf of the Banks, takes such action,
          it shall apply all proceeds first to the payment of costs under
          this Agreement, then to the payment of the Senior Obligations and
          any surplus proceeds remaining thereafter to be paid over to
          whomsoever may be lawfully entitled thereto; and

                    (b)  each Subordinated Party shall duly and promptly
          take such action as the Administrative Agent, on behalf of the
          Banks, may request (i) to file appropriate claims or proofs of
          claim in respect of the Subordinated Debt, (ii) to execute and
          deliver to the Administrative Agent, on behalf of the Banks, such
          powers of attorney, assignments, or other instruments as the
          Administrative Agent, on behalf of the Banks, may request in
          order to enable it to enforce any and all claims with respect to,
          and any security interests and other liens securing payment of,
          the Subordinated Debt, and (iii) to collect and receive any and
          all payments or distributions which may be payable or deliverable
          upon or with respect to the Subordinated Debt for account of the
          Administrative Agent, on behalf of the Banks.

                    2.4.  Certain Payments Held in Trust.  All payments or
          distributions upon or with respect to the Subordinated Debt that
          are received by any Subordinated Party or any of its Affiliates,
          directly or indirectly, by set-off or in any other manner,
          including, without limitation, from or by way of collateral,
          contrary to the provisions of this Agreement, the Receivables
          Transfer Agreement or any Subordinated Note shall be received in
          trust for the benefit of the Banks, shall be segregated from
          other funds and property held by such Subordinated Party or such
          Affiliate and shall be forthwith paid over to the Administrative
          Agent on behalf of the Banks in the form received (with any
          necessary endorsement or assignment) to be applied (in the case
          of cash) to, or held as collateral (in the case of noncash
          property or securities) for the payment of, the Senior
          Obligations until the Senior Obligations shall have been paid in
          full in cash.  In the event that any Subordinated Party or its
          Affiliate fails to make any endorsement or assignment required
          hereby, the Administrative Agent, on behalf of the Banks, is
          hereby irrevocably authorized to make such endorsement or
          assignment as attorney-in-fact for such Subordinated Party or
          such Affiliate.

                    2.5.  Subrogation.  Each Subordinated Party agrees that
          no payment or distribution to the Administrative Agent or the
          Banks pursuant to the provisions of this Agreement shall entitle


<PAGE>


                                                                          5

          any Subordinated Party to exercise any rights of subrogation in
          respect thereof until the Senior Obligations shall have been paid
          in full in cash.  Each Subordinated Party agrees that the
          subordination provisions contained herein shall not be affected
          by any action, or failure to act, by any holder of Senior
          Obligations which results, or may result, in affecting, impairing
          or extinguishing any right of reimbursement or subrogation or
          other right or remedy of any Subordinated Party.

                    2.6.  Waiver of Notices, Etc.  Each Subordinated Party
          and the Company hereby waives promptness, diligence, notice of
          acceptance and any other notice with respect to any of the Senior
          Obligations and the Subordinated Debt and any requirement that
          the Administrative Agent or any Bank protect, secure, perfect or
          insure any security interest or lien on any property subject
          thereto or exhaust any right or take any action against the
          Company or any other Person or any Pooled Property.

                    2.7.  No Security.  (a)  Without the prior written
          consent of the Required Banks, the Company will not give to any
          Person, and neither any of the Subordinated Parties nor any of
          their Affiliates will receive or accept, any security of any
          nature whatsoever in respect of the Subordinated Debt on any
          property or assets, whether now existing or hereafter acquired,
          of the Company.

                    (b)  Each Subordinated Party agrees and confirms that
          the Subordinated Debt held by it represents solely the right to
          receive certain amounts from funds available under the
          Receivables Transfer Agreement and only to the extent, in the
          manner and at the times set forth in the Receivables Transfer
          Agreement and that the Subordinated Debt held by it does not
          represent a security or other interest in the Receivables or
          their proceeds.

                    2.8.  Subordination Legend; Further Assurances.  
          The Subordinated Parties will cause each instrument evidencing
          the Subordinated Debt held by it to be endorsed with the
          following legend:

                         "The indebtedness evidenced by this instrument is
                    subordinated to the prior payment in full of the Senior
                    Obligations (as defined in the Subordination Agreement
                    hereinafter referred to) pursuant to, and to the extent
                    provided in, the Subordination Agreement, dated as of
                    July 13, 1994, among the maker hereof, the payee named
                    herein and certain other parties."

          Each of the Subordinated Parties will further mark its books of
          account, in such a manner as shall be effective to give proper
          notice of the effect of this Agreement and will cause all
          Subordinated Debt held by it to be evidenced by all appropriate
          instrument or instruments endorsed with the above legend.  Each
          of the Subordinated Parties will, at its expense and at any time


<PAGE>


                                                                          6

          and from time to time, promptly execute and deliver all further
          instruments and documents, and take all further action, that may
          be necessary or desirable or that the Administrative Agent, on
          behalf of the Banks, may, at any time, request, in order to
          protect any right or interest granted or purported to be granted
          hereby or to enable the Administrative Agent, on behalf of the
          Banks, to exercise and enforce its rights and remedies hereunder.

                    2.9.  Representations and Warranties.  Each Seller
          hereby represents and warrants that this Agreement constitutes a
          legal, valid and binding obligation of such Person, enforceable
          in accordance with its terms, except as such enforceability may
          be limited by applicable bankruptcy, insolvency, reorganization,
          moratorium or other similar laws now or hereafter in effect
          affecting the enforcement of creditors' rights in general and
          except as such enforceability may be limited by general
          principles of equity (whether considered in a suit at law or in
          equity).


                                     ARTICLE III

                    OTHER MATTERS REGARDING THE SUBORDINATED DEBT

                    3.1.  No Waiver.  No right of the Senior Parties to
          enforce this Agreement shall at any time or in any way be
          prejudiced or impaired by any act or failure to act on the part
          of any of the Senior Parties, the Company or any Subordinated
          Party, or by any noncompliance by the Company or any Subordinated
          Party with the terms, provisions and covenants herein, and the
          Senior Parties are hereby expressly authorized to extend, renew,
          increase, decrease, modify or amend the terms of the Senior
          Obligations or any security therefor, and to release, sell or
          exchange any such security and otherwise deal freely with the
          Company, all without notice to or consent of any Subordinated
          Party or any of its Affiliates hereunder and without affecting
          the liabilities and obligations of the parties hereto.

                    3.2.  Payment on Subordinated Debt and Remedies.  Each
          of the Subordinated Parties agrees that, except upon request of
          the Administrative Agent, it will not ask, demand, accelerate,
          sue or take or receive from the Company, directly or indirectly
          (including from or by way of collateral), any payment of or
          security for all or any part of the Subordinated Debt or exercise
          any remedies or take any action or proceeding to enforce the same
          until the Senior Obligations have been paid in full in cash, and
          each Subordinated Party further agrees not to institute or join
          with any other creditors of the Company in instituting any
          petition commencing any bankruptcy, insolvency, reorganization,
          arrangement, receivership or similar proceeding or any assignment
          for the benefit of creditors against or in respect of the Company
          or any other marshalling of the assets and liabilities of the
          Company.


<PAGE>


                                                                          7

                    3.3.  No Transfer of or Change in Subordinated Debt. 
          Each Subordinated Party agrees that it will (a) not sell, assign,
          transfer, hypothecate or otherwise dispose of all or any part of
          the Subordinated Debt to any Person, including any of such
          Subordinated Party's Affiliates, (b) permit the terms of any of
          the Subordinated Debt to be changed in any manner or (c)
          subordinate any Subordinated Debt for the benefit of any other
          Person, in each case without the prior written consent of the
          Administrative Agent.

                    3.4.  Obligations Hereunder Not Affected.  All rights
          and interests of the Senior Parties hereunder, and all agreements
          and obligations of the Subordinated Parties and the Company
          hereunder, shall remain in full force and effect irrespective of:

                    (a)  any change in the time, manner or place of payment
               of, or in any other term of, all or any of the Senior
               Obligations, or any other amendment or waiver of or consent
               to departure from the Receivables Transfer Agreement or any
               other Transaction Document; or

                    (b)  any exchange, release or nonperfection of any
               security interest in any collateral, or any release or
               amendment or waiver of or consent to departure from any
               Transaction Document, in respect of all or any of the Senior
               Obligations.

                    This Agreement shall continue to be effective or be
          reinstated, as the case may be, if at any time any payment of the
          Senior Obligations or any part thereof is rescinded or must
          otherwise be returned by any Senior Party upon the insolvency,
          bankruptcy or reorganization of the Company or otherwise, all as
          though such payment had not been made.

                    Each Subordinated Party hereby authorizes the Senior
          Parties, without notice or demand hereunder and without affecting
          or impairing any of the obligations of any Subordinated Party
          hereunder, from time to time to (a) renew, compromise, extend,
          increase, accelerate or otherwise change the time for payment of,
          or otherwise change the terms of, the Senior Obligations or any
          part thereof or any security therefor; (b) take or hold security
          for the payment of the Senior Obligations and exchange, enforce,
          foreclose upon, waive or release any such security; (c) apply
          such security and direct the order or manner of sale thereof as
          the Senior Parties, in their sole discretion, may determine; (d)
          release and substitute one or more endorsers, warrantors,
          borrowers or other obligors; and (e) exercise or refrain from
          exercising any rights against any Subordinated Party, the Company
          or any other Person and otherwise deal freely with the Company.

                    3.5.  Reaffirmation of Representations and Warranties. 
          Each Subordinated Party party to the Receivables Sale Agreement
          or the Receivables Transfer Agreement, as the case may be,
          reaffirms and repeats its respective representations and



<PAGE>



                                                                          8

          warranties contained in such Agreements and agrees that the Banks
          and the Administrative Agent may rely on such representations and
          warranties as though set forth herein in full.


                                      ARTICLE IV

                                    MISCELLANEOUS

                    4.1.  Notices.  All notices, requests and demands to or
          upon the respective parties hereto to be effective shall be in
          writing (including by telecopy), and, unless otherwise expressly
          provided herein, shall be deemed to have been duly given or made
          when delivered by hand, or three days after being deposited in
          the mail, postage prepaid, or, in the case of telecopy notice,
          when received, addressed to the addresses in accordance with
          subsection 11.9 of the Receivables Transfer Agreement.

                    4.2.  Survival of Agreement.  All covenants,
          agreements, representations and warranties made by the Company
          and each Subordinated Party herein and in the certificates or
          other instruments prepared or delivered in connection with or
          pursuant to this Agreement shall be considered to have been
          relied upon by the Administrative Agent and the holders of the
          Senior Obligations and shall survive the execution and delivery
          of the Transaction Documents, regardless of any investigation
          made by the Administrative Agent or the holders of the Senior
          Obligations or on their behalf, and shall continue in full force
          and effect as long as any Senior Obligation is outstanding and
          unpaid and so long as the Commitments have not been terminated.

                    4.3.  Binding Effect.  This Agreement shall become
          effective when it shall have been executed by the Company, the
          Administrative Agent and each Subordinated Party and thereafter
          shall be binding upon and inure to the benefit of the Company,
          each Subordinated Party, the Administrative Agent and the Banks
          and their respective successors and assigns, except that neither
          the Company nor any Subordinated Party shall have the right to
          assign or delegate its rights or duties hereunder.

                    4.4.  GOVERNING LAW.  THIS AGREEMENT AND THE RIGHTS AND
          OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED
          BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF
          THE STATE OF NEW YORK.

                    4.5.  No Waiver; Cumulative Remedies.  No failure to
          exercise and no delay in exercising, on the part of the
          Administrative Agent or the Banks, any right, remedy, power or
          privilege hereunder, shall operate as a waiver thereof, nor shall
          any single or partial exercise of any right, remedy, power or
          privilege hereunder preclude any other or further exercise
          thereof or the exercise of any other right, remedy, power or
          privilege.  The rights, remedies, powers and privileges herein



<PAGE>



                                                                          9

          provided are cumulative and not exhaustive of any rights,
          remedies, powers and privileges provided by law.

                    4.6.  Waivers; Amendment.  Neither this Agreement nor
          any terms hereof may be waived, amended, supplemented or modified
          except pursuant to an agreement or agreements in writing entered
          into by the Company, each affected Subordinated Party and the
          Administrative Agent.  Each Senior Party shall be bound by any
          waiver, amendment, supplement or modification authorized by this
          Section.

                    4.7.  WAIVER OF JURY TRIAL.  THE COMPANY, THE SELLERS
          AND THE ADMINISTRATIVE AGENT HEREBY IRREVOCABLY AND
          UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR
          PROCEEDING RELATING TO THIS AGREEMENT AND FOR ANY COUNTERCLAIM
          THEREIN.

                    4.8.  Severability.  Any provision of this Agreement
          which is prohibited or unenforceable in any jurisdiction shall,
          as to such jurisdiction, be ineffective to the extent such
          prohibition or unenforceability without invalidating the
          remaining provisions hereof, and any such prohibition or
          unenforceability in any jurisdiction shall not invalidate or
          render unenforceable such provision in any other jurisdiction.

                    4.9.  Counterparts.  This Agreement may be executed by
          one or more of the parties to this Agreement on any number of
          separate counterparts (including by telecopy), and all of said
          counterparts taken together shall be deemed to constitute one and
          the same instrument.  A set of the copies of this Agreement
          signed by all the parties shall be lodged with the Company and
          the Administrative Agent.

                    4.10.  Addition of Sellers.  Subject to the terms and
          conditions of the Receivables Sale Agreement, from time to time
          one or more Subsidiaries of the C&A Products may become
          additional Sellers parties to the Receivables Sale Agreement. 
          Upon any such Subsidiary becoming an additional Seller under the
          Receivables Sale Agreement, such Subsidiary shall automatically
          be deemed for all purposes hereunder to be a Seller under this
          Agreement, commencing on the related Seller Addition Date.


<PAGE>




                                                                         10


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


                                        CARCORP, INC.


                                        By:___________________________
                                           Title:

                                        CHEMICAL BANK, as Administrative
                                          Agent


                                        By:___________________________
                                           Title:


                                        The Sellers:

                                        COLLINS & AIKMAN PRODUCTS CO.


                                        By:___________________________
                                           Title:

                                        ACK-TI-LINING, INC.


                                        By:_________________________
                                           Title:

                                        WCA CANADA, INC.


                                        By:_________________________
                                           Title:

                                        IMPERIAL WALLCOVERINGS (CANADA),
                                          INC.


                                        By:_________________________
                                           Title:





<PAGE>




                                                                         11

                                        IMPERIAL WALLCOVERINGS, INC.


                                        By:_________________________
                                           Title:


                                        THE AKRO CORPORATION


                                        By:_________________________
                                           Title:

                                        DURA ACQUISITION CORP.


                                        By:_________________________
                                           Title:


<PAGE>




                                                           EXHIBIT E TO THE
                                             RECEIVABLES TRANSFER AGREEMENT




                                   COLLINS & AIKMAN
                            as Master Servicer for Carcorp
                              Monthly Settlement Report


          For Fiscal Period:

          Beginning

          Ending


          I. CALCULATION OF RECEIVABLES BALANCE
          A. Beginning Gross Receivables Balance
          B. Receivables Created During Fiscal Month
          C. Less: Cash Collections Occurring During Fiscal Month
               Cash Discounts
               Returns
               Other Credits
          D. Less: Total Dilutive Credits
               Writeoffs
               Recoveries
          E. Less: Writeoffs Net of Recoveries
          F. Ending Gross Receivables Balances for Fiscal Month

          II.  CALCULATION OF ELIGIBLITY PERCENTAGE

          A. Gross Receivables Balance on Eligibility Determination Date

          B. Less Amounts in Gross Receivables Which:

          C.   the Entity does not have lawful/absolute title; subject to a

          lien by another

          D.   the Buyer does not have a legal, valid, binding 1st priority
          security interest

          E.  the Entity does not  have a full right to assign and  grant a
          lien to Buyers

          F.    are not  payable  in  US  Dollars or  are  not  enforceable
          obligations of the debtor
               Less: receivables denominated in Canadian dollars

          G.   are  subject to  any  bona fide  dispute, claim,  setoff  or
          counterclaim by debtor

          H.   are  not evidenced  by an  invoice but  by an  instrument or
          chattel paper

          I.  are not bona fide accounts:

              (i) accounts from goods shipped on consignment



<PAGE>


              (ii) accounts of services not performed or completed

          J.  The Receivables Debtor is any of the following:

               (i) incorporated outside the US
                Less: Canadian accounts which are otherwise eligible
                accounts of Japanese Receivables Debtors
                accounts incorporated outside the  U.S. but supported by an
                LOC
               (ii.) any direct or indirect subsidiary of Holdings
               (iii) a domestic or foreign government or agency
               Less:  receivables of  the United  States Gov't  or agencies
               thereof
               (iv) is subject to bankruptcy or reorganization

          K.  Invoices outstanding 90 days past original invoice date  (120
          days for Imperial)

          L.   payment  in  respect of  receivable  has been  returned  for
          insufficient funds

          M. are placed with attorneys for collection

          N.  is  a  consumer  credit  card  receivable  w/o  all  consumer
          protection laws

          O. is a  consumer credit card receivable with two  or more missed
          payments

          P.  is an account specified by the Administrative Agent

          Q. Sum of Ineligible Receivables Specified Above

          R. Eligible Receivables

          Less:  Receivables  supported  by an  LOC  in  excess  of 15%  of
          Adjusted  Principal

          Amount of Eligible Receivables


          Less:   United States government or  agency Receivables in excess
          of   3% of the Adjusted Principal Amount of Eligible Receivables

          Less:  Receivables  denominated in Canadian dollars  in excess of
          10%  of Adjusted Principal Amount of Eligible Receivables

          Less:  Balances in  excess of obligor percentage (zero  until 270
               days after closing)

          S.  Remaining Eligible Receivables

          T.  Eligiblity Percentage [ (R) / (S) ]




<PAGE>




               III.  CALCULATION OF MAXIMUM INVESTED PERCENTAGE

          Loss Reserve Ratio

          A. Aggregate Adjusted Principal Amount of Receivables which were
          90-119 days past due as of the last day of such fiscal month

          B.  Aggregate Adjusted  Principal Amount of Receivables generated
          by the Sellers during the fifth month prior to such fiscal month

          C. Default Ratio (A/B)

          D. The highest three  month rolling average of the  Default Ratio
          that occurred during the last twelve fiscal months

          E. Factor

          F.  The   Aggregate  Adjusted  Principal  Amount  of  Receivables
          generated during the last 3.5 fiscal months

          G.  The   outstanding  Adjusted  Principal   Amount  of  Eligible
          Receivables as of the last day of such fiscal month.

          H. Loss Reserve Ratio (D*(F/G)*E)


          Yield Reserve Ratio

          I.  Discount Rate  = (Weighted  Average Purchase  Discount Amount
          Rate in effect at the end of the last fiscal month + accrued fees
          (other than the servicing fee) for such fiscal month / average
          daily Net Investment during such fiscal month)

          J.  Days  Sales Outstanding = 91 * (Amount  of receivables at the
          end of  the last fiscal month - aggregate bad debt reserve at the
          end of such fiscal month) / aggregate net sales for last 3 fiscal
          months

          K.  Factor

          L. Yield Reserve Ratio  (I*J*K)/360

          Servicing Reserve Percentage

          M. Servicing Reserve Percentage

          Dilution Reserve Percentage

          N.  Factor

          O.  Aggregate Dilutive Credits for last 12 fiscal months

          P.  Aggregate Adjusted Principal Amount of Receivables generated 
              during last fiscal 12 months


<PAGE>




          Q.  Average Dilution Ratio (O / P)

          R.  The Peak Dilution Ratio during the last 12 fiscal months

          S.    The  aggregate  Adjusted Principal  Amount  of  Receivables
          generated in  last fiscal month divided by the aggregate Adjusted
          Amount of Eligible Receivables for such fiscal month

          T.  Dilution Reserve Ratio ((N*Q)+(R-Q)*(R/Q)))*S

          Required Reserve Percentage:

          Sum of:
          Loss Reserve Ratio
          Yield Reserve Ratio
          Servicing Reserve Ratio
          Dilution Reserve Ratio

          V.  Total Required Reserve Percentage

          Maximum Invested Percentage

          W.     100%  minus  greater  of  17%  and  the  Required  Reserve
          Percentage


          IV. MONTHLY AGINGS SUMMARY

          Total
          Outstanding         1 - 29    30 - 59   60 - 89   90-119    120 +
          Balance of          Days      Days      Days      Days      Days
          Receivables         Current   Past Due  Past Due  Past Due  Past 
          $  
          %

          V.  CONCENTRATIONS - TOP 5 OBLIGORS

                                                            Excess
                              % of           Applicable     over
                              Eligible       Obligor        Obligor
                    Balance   Receivables    Percentage     Percentage

          1.
          2.
          3.
          4.
          5.



<PAGE>




                              FINANCIAL COVENANTS

                                                       ACTUAL    COVENANT


          VI.  LOSS TO LIQUIDATION RATIO

          A. Writeoffs net of Recoveries during the last 12 fiscal months


          B. Four times the aggregate amount of Collections during the last
               3 fiscal months

          C. Loss to Liquidation Ratio  (A / B)


          VII. DAYS SALES OUTSTANDING

          A.  DSO


          VIII.  % OF RECEIVABLES > 60 DAYS PAST DUE

          A.  All Receivables more than 60 days past due at the end of last
          fiscal month

          B.  Gross  Receivables balance at the end of such fiscal month

          C.  (A / B)



<PAGE>



                                EXHIBIT C TO THE RECEIVABLES SALE AGREEMENT
                            EXHIBIT F TO THE RECEIVABLES TRANSFER AGREEMENT


                   [FORM OF ADDITIONAL SELLER/SERVICER SUPPLEMENT]


                    SUPPLEMENT, dated _________________, to (i) the
          Receivables Sale Agreement, dated as of July 13, 1994 (as
          amended, the "Receivables Sale Agreement"), among Collins &
          Aikman Products Co., a Delaware corporation ("C&A Products"), and
          each of the subsidiaries of C&A Products from time to time
          parties thereto (the "Sellers"), C&A Products, as master servicer
          (in such capacity, the "Master Servicer"), and Carcorp, Inc., a
          Delaware corporation (the "Company"), (ii) the Receivables
          Transfer and Servicing Agreement, dated as of July 13, 1994 (as
          amended, the "Receivables Transfer Agreement"), among the
          Company, the Master Servicer, certain of the Sellers, in their
          capacities as servicers of the Receivables (in such capacities,
          the "Servicers"), the several financial institutions from time to
          time parties thereto (the "Banks") and Chemical Bank, as
          administrative agent for the Banks (in such capacity, the
          "Administrative Agent"), and (iii) the Subordination Agreement,
          dated as of July 13, 1994 (as amended, the "Subordination
          Agreement"), among the Company, the Sellers from time to time
          parties thereto and the Administrative Agent.


                                W I T N E S S E T H :


                     WHEREAS, the Receivables Sale Agreement provides that
          any Subsidiary of C&A Products, although not originally a Seller
          thereunder, may become a Seller under the Receivables Sale
          Agreement, with (i) the consent of the Company and the Required
          Banks and (ii) the satisfaction of each of the conditions
          precedent set forth in subsection 3.4 of the Receivables Sale
          Agreement (one of which is the delivery to the Company of a
          supplement in substantially the form of this Supplement);

                     WHEREAS, the Receivables Transfer Agreement provides
          that any Subsidiary of C&A Products, although not originally a
          Servicer thereunder, may become a Servicer under the Receivables
          Transfer Agreement, with (i) the consent of the Company and the
          Required Banks to such Subsidiary becoming a Seller under the
          Receivables Sale Agreement, (ii) the delivery to the Company of a
          supplement in substantially the form of this Supplement and (iii)
          the satisfaction of each of the conditions precedent set forth in
          subsection 3.4 of the Receivables Sale Agreement;

                    WHEREAS, the Subordination Agreement provides that any
          Subsidiary of C&A Group, although not originally a Seller
          thereunder, shall become a Seller under the Subordination
          Agreement immediately upon such Subsidiary becoming a Seller
          under the Receivables Sale Agreement; and


<PAGE>



                                                                          2

                    WHEREAS, the undersigned was not an original Seller
          under the Receivables Sale Agreement and the Subordination
          Agreement or an original Servicer under the Receivables Transfer
          Agreement but now desires to become a Seller and a Servicer,
          respectively, thereunder.

                    NOW, THEREFORE, the undersigned hereby agrees as
          follows:

                    1.   The undersigned agrees to be bound by all of the
               provisions of each of the Receivables Sale Agreement, the
               Subordination Agreement and the Receivables Transfer
               Agreement applicable to a Seller and a Servicer,
               respectively, thereunder and agrees that it shall, on the
               date this Supplement is accepted by the Company and the
               Required Banks, become (a) in the case of the Receivables
               Sale Agreement and the Subordination Agreement, a Seller and
               (b) in the case of the Receivables Transfer Agreement, a
               Servicer, for all purposes of the Receivables Sale
               Agreement, the Subordination Agreement and the Receivables
               Transfer Agreement, respectively, to the same extent as if
               originally a party thereto.

                    2.   Terms defined in Annex X to the Receivables
               Transfer Agreement shall have their defined meanings when
               used herein.

                    IN WITNESS WHEREOF, the undersigned has caused this
          Supplement to be executed and delivered by a duly authorized
          officer on the date first above written.

                                        [Insert name of Seller/Servicer]


                                        By________________________________
                                          Title:

          Accepted as of the date first
          above written:

          CARCORP, INC.


          By:                         
             Title:

          [Required Banks]


          By:                         
             Title:








<PAGE>


                                                              EXHIBIT G TO THE
                                                RECEIVABLES TRANSFER AGREEMENT

                            [FORM OF CLOSING CERTIFICATE]

                              [NAME OF CERTIFYING PARTY]
                               (a Delaware corporation)

                    Pursuant to subsection[s] 6.1(a)[, (f), (k), (m) and
          (r)]* of the Receivables Transfer and Servicing Agreement, dated
          as of July 13, 1994 (the "Receivables Transfer Agreement";
          capitalized terms defined therein shall be used herein as therein
          defined), among Carcorp, Inc., a Delaware corporation (the
          "Company"), Collins & Aikman Products Co., a Delaware corporation
          ("C&A Products"), as master servicer (in such capacity, the
          "Master Servicer"), C&A Products and each of the subsidiaries of
          C&A Products from time to time parties thereto, in their
          capacities as servicers (in such capacities, the "Servicers"),
          the several financial institutions from time to time parties
          thereto (the "Banks"), and Chemical Bank, a New York banking
          corporation, as administrative agent for the Banks (in such
          capacity, the "Administrative Agent"), the undersigned
          ___________ of __________________ (the "Certifying Party") hereby
          certifies as follows:

                    [1.  As of the date hereof, each of the conditions
               precedent set forth in subsection 6.2 of the Receivables
               Transfer Agreement has been satisfied;

                    2.  As of the date hereof, all conditions to the
               obligations of the Company and each of the Sellers under the
               Receivables Sale Agreement have either been (i) satisfied or
               (ii) waived by the Required Banks;

                    3.  As of the date hereof (and after giving effect to
               all of the transactions occurring on the Effective Date),
               the Company is not "insolvent" under Section 101(32) of the
               U.S. Bankruptcy Code (11 U.S.C. Section 101(32));

                    4.  Attached hereto as Exhibit A is a true, correct and
               complete copy of (a) the written Policies, or, to the extent
               that the credit and collection policies of the Sellers are
               not in written form at the date hereof, a written
               description of the historical credit and collection
               practices of the Sellers and proposed practices for the
               Company and (b) the Company Policies;]*

                    5.  As of the date hereof, the representations and
               warranties of the Certifying Party set forth in
               ___________** of the Receivables Transfer Agreement are
               true and correct in all material respects on and as of such
               date;

                              

          */   Insert bracketed language only in certificate of Company.

          **/  Insert "Article V" in the case of the Company or subsection
               12.6 in the case of the other Certifying Parties.


<PAGE>

                                                                              2



                    6.  ___________ is and at all times since ___ __, 199  
               has been, the duly elected and qualified [Secretary] of the
               Certifying Party and the signature set forth for such
               officer below is such officer's true and genuine signature;

          and the undersigned [Secretary] of the Certifying Party certifies
          as follows:

                    7.  There are no liquidation or dissolution proceedings
               pending or to my knowledge threatened against the Certifying
               Party, nor has any other event occurred adversely affecting
               or threatening the continued corporate existence of the
               Certifying Party after the date hereof;

                    8.  The Certifying Party is a corporation duly
               organized, validly existing and in good standing under the
               laws of its jurisdiction of incorporation;

                    9.  Attached hereto as Annex 1 is a correct and
               complete copy of resolutions duly adopted by the Board of
               Directors of the Certifying Party on __________ ___, 1994
               authorizing (i) the execution, delivery and performance of
               the Transaction Documents and the other documents executed
               and delivered pursuant thereto to which it is a party and
               (ii) the transactions contemplated by such Transaction
               Documents and such other documents; such resolutions have
               not in any way been amended, modified, revoked or rescinded
               and have been in full force and effect since their adoption
               to and including the date hereof and are now in full force
               and effect; such resolutions are the only corporate
               proceedings of the Certifying Party now in force relating to
               or affecting the matters referred to therein; attached
               hereto as Annex 2 is a correct and complete copy of the By-
               Laws of the Certifying Party as in effect at all times since
               ____ __, 199   to and including the date hereof; and
               attached hereto as Annex 3 is a correct and complete copy of
               the Certificate of Incorporation of the Certifying Party as
               in effect at all times since ____ __, 199   to and including
               the date hereof, and such By-laws and Certificate have not
               been amended, repealed, modified or restated;

                    10.  The following persons are now duly elected and
               qualified officers of the Certifying Party holding the
               offices indicated next to their respective names below, and
               such officers have held such offices with the Certifying
               Party at all times since the date indicated next to their
               respective titles to and including the date hereof, and the
               signatures appearing opposite their respective names below
               are the true and genuine signatures of such officers, and
               each of such officers is duly authorized to execute and
               deliver on behalf of the Certifying Party each of the
               Transaction Documents and the other documents executed and
               delivered pursuant thereto to which it is a party: 


<PAGE>

                                                                            3




                Name                    Office                 Signature











                    IN WITNESS WHEREOF, the undersigned have hereunto set
          our names as of the date set forth below.






          By:                                     By:                       

             Title:                                   Title:  


          Date:     July __, 1994




<PAGE>



                                                           EXHIBIT H TO THE
                                             RECEIVABLES TRANSFER AGREEMENT



                                    CARCORP, INC.
                                 Receivables Facility
                                   Daily Report


          Today's Date
          Date of Processing


          Daily Servicer Input

          Gross Receivables Balance - Previous Date
               Plus Can. dollar New Sales

               Plus U.S. dollar New Sales

               Less Can. dollar Collections

               Less U.S. dollar Collections

               Foreign Exchange Gain/(Loss)    

               Less Other Adjustments

               Gross Receivables Balance - Today


          Calculation of Maximum Transfer 

               Eligibility Percentage

               Eligible Receivables

               Required Reserve Percentage

               Required Reserves

               Maximum Transfer


          Total in Cash Collateral Accounts

               Beginning Balance

               Plus New Earnings

               Plus New Deposits

               Less Contribution to Sources

               Ending Balance



<PAGE>





          Calculation of Net Investment

               Net Investment - Previous

               New Transfers Allowed / (Repmts. Req.'d)

               Cash Received from New Transfers

               Cash Repayments

               Libor Tranche Maturities

               ABR Balance

               Cash Collateral Account

               Net Investment - Today

               Less Cash Collateral Balance

               Aggregate Net Investment

               Excess/(Shortfall) Maximum Transfer vs. Net Investment

               Flow of Funds

               SOURCES

                    Cash Collections Balance Available

                    Cash Collateral Balance Available

                    New Transfers

                    Capital Contribution

                    Total Sources

               USES

               Purchase Discount Payment

               Bank Fee Payment

               Net Investment Repayment

               Operating Expense Payment

               Servicer Fee Payment

               Recvbls Purchase / Sub Note Repay / Dividends

               Total Uses





<PAGE>

                                                              EXHIBIT I TO THE
                                                RECEIVABLES TRANSFER AGREEMENT




                                   CARCORP, INC.







                            RECEIVABLES SALE AGREEMENT








                            Dated as of July 13, 1994


<PAGE>



                                   TABLE OF CONTENTS


                                                                           Page



                                       ARTICLE I

                                      DEFINITIONS

             1.1  Defined Terms . . . . . . . . . . . . . . . . . . . . . .  1
             1.2  Other Definitional Provisions . . . . . . . . . . . . . .  1

                                       ARTICLE II

                            PURCHASE AND SALE OF RECEIVABLES

             2.1  Purchase and Sale of Receivables  . . . . . . . . . . . .  2
             2.2  Purchase Price  . . . . . . . . . . . . . . . . . . . . .  3
             2.3  Payment of Purchase Price . . . . . . . . . . . . . . . .  3
             2.4  No Repurchase . . . . . . . . . . . . . . . . . . . . . .  5
             2.5  Rebates, Adjustments, Returns and Reductions;
                    Modifications . . . . . . . . . . . . . . . . . . . . .  5
             2.6  Limited Repurchase Obligation . . . . . . . . . . . . . .  5
             2.7  Obligations Unaffected  . . . . . . . . . . . . . . . . .  6
             2.8  Certain Charges . . . . . . . . . . . . . . . . . . . . .  6
             2.9  Certain Allocations . . . . . . . . . . . . . . . . . . .  6


                                      ARTICLE III

                            CONDITIONS TO PURCHASE AND SALE

             3.1  Conditions Precedent to the Company's Initial Purchase of
                    Receivables . . . . . . . . . . . . . . . . . . . . . .  6
             3.2  Conditions Precedent to All the Company's Purchases of
                    Receivables . . . . . . . . . . . . . . . . . . . . . .  7
             3.3  Conditions Precedent to Sellers' Obligations  . . . . . .  8
             3.4  Conditions Precedent to the Addition of a Seller  . . . .  9


                                       ARTICLE IV

                             REPRESENTATIONS AND WARRANTIES

             4.1  Representations and Warranties of the Sellers Relating to
                    the Sellers . . . . . . . . . . . . . . . . . . . . . .  10
                    (a)  Organization, Corporate Powers . . . . . . . . . .  10



                                             -i-

<PAGE>



                                                                          Page

                    (b)  Authorization  . . . . . . . . . . . . . . . . . .  10
                    (c)  Enforceability . . . . . . . . . . . . . . . . . .  11
                    (d)  Capitalization . . . . . . . . . . . . . . . . . .  11
                    (e)  Litigation; Compliance with Laws . . . . . . . . .  11
                    (f)  Agreements . . . . . . . . . . . . . . . . . . . .  11
                      (g)  Tax Returns  . . . . . . . . . . . . . . . . . .  12
                    (h)  No Material Misstatements  . . . . . . . . . . . .  12
                    (i)  Employee Benefit Plans . . . . . . . . . . . . . .  13
                    (j)  Solvency . . . . . . . . . . . . . . . . . . . . .  13
              . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  13
              . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  13
                    (l)  Indebtedness to Company. . . . . . . . . . . . . .  13
                    (m)  Lockboxes. . . . . . . . . . . . . . . . . . . . .  13
                    (n)  Filings  . . . . . . . . . . . . . . . . . . . . .  14
                    (o)  Receivables Documents  . . . . . . . . . . . . . .  14
             4.2  Representations and Warranties of the Sellers Relating to
                    the Agreement and the Receivables . . . . . . . . . . .  14


                                       ARTICLE V

                                 AFFIRMATIVE COVENANTS

             5.1  Certificates; Other Information . . . . . . . . . . . . .  16
             5.2  Compliance with Laws, etc.  . . . . . . . . . . . . . . .  16
             5.3  Preservation of Corporate Existence . . . . . . . . . . .  16
             5.4  Visitation Rights . . . . . . . . . . . . . . . . . . . .  16
             5.5  Keeping of Records and Books of Account . . . . . . . . .  17
             5.6  Location of Records . . . . . . . . . . . . . . . . . . .  17
             5.7  Computer Files  . . . . . . . . . . . . . . . . . . . . .  17
             5.8  Policies  . . . . . . . . . . . . . . . . . . . . . . . .  17
             5.9  Taxes; ERISA  . . . . . . . . . . . . . . . . . . . . . .  17
             5.10  Collections  . . . . . . . . . . . . . . . . . . . . . .  18
             5.11  Lockbox Agreements; Lockbox Accounts . . . . . . . . . .  18
             5.12  Furnishing Copies, etc . . . . . . . . . . . . . . . . .  19
             5.13  Obligations with Respect to Obligors and Receivables . .  19
             5.14  Responsibilities of the Sellers  . . . . . . . . . . . .  19
             5.15  Further Action . . . . . . . . . . . . . . . . . . . . .  20


                    5.16  Certain Procedures
             6.1  Liens . . . . . . . . . . . . . . . . . . . . . . . . . .  22
             6.2  Extension or Amendment of Receivables . . . . . . . . . .  22
             6.3  Change in Payment Instructions to Obligors  . . . . . . .  22
             6.4  Change in Name  . . . . . . . . . . . . . . . . . . . . .  22


                                          -ii-

<PAGE>


             6.5  Modification of Ledger  . . . . . . . . . . . . . . . . .  22
             6.6  Business of the Sellers . . . . . . . . . . . . . . . . .  23
             6.7  Accounting of Purchases . . . . . . . . . . . . . . . . .  23
             6.8  Chattel Paper . . . . . . . . . . . . . . . . . . . . . .  23
             6.9  Ineligible Receivables  . . . . . . . . . . . . . . . . .  23


                                      ARTICLE VII

                              PURCHASE TERMINATION EVENTS   . . . . . . . .  23



                                      ARTICLE VIII

                                 THE SUBORDINATED NOTES

             8.1  Subordinated Notes  . . . . . . . . . . . . . . . . . . .  25
             8.2  Restrictions on Transfer of Subordinated Notes  . . . . .  25
                                       ARTICLE IX

                                     MISCELLANEOUS

             9.1  Further Assurances  . . . . . . . . . . . . . . . . . . .  26
             9.2  Payments  . . . . . . . . . . . . . . . . . . . . . . . .  26
             9.3  Costs and Expenses  . . . . . . . . . . . . . . . . . . .  26
             9.4  Successors and Assigns  . . . . . . . . . . . . . . . . .  27
             9.5  GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . .  27
             9.6  No Waiver; Cumulative Remedies  . . . . . . . . . . . . .  28
             9.7  Amendments and Waivers  . . . . . . . . . . . . . . . . .  28
             9.8  Severability  . . . . . . . . . . . . . . . . . . . . . .  28
             9.9  Notices . . . . . . . . . . . . . . . . . . . . . . . . .  28
             9.10  Counterparts . . . . . . . . . . . . . . . . . . . . . .  28
             9.11  Construction of Agreement as Security Agreement  . . . .  29
             9.12  Waivers of Jury Trial  . . . . . . . . . . . . . . . . .  29
             9.13  Jurisdiction; Consent to Service of Process  . . . . . .  29
             9.14  Addition of Sellers  . . . . . . . . . . . . . . . . . .  30
             9.15  Optional Termination of Seller . . . . . . . . . . . . .  30
             9.16  No Bankruptcy Petition . . . . . . . . . . . . . . . . .  31
             9.17  Termination  . . . . . . . . . . . . . . . . . . . . . .  31
             9.18  Confidentiality  . . . . . . . . . . . . . . . . . . . .  31


        ANNEX X     Definitions



                                            -iii-

<PAGE>

                                                                          Page

        SCHEDULES

              1     Locations of Chief Executive Offices; Locations of 
                      Books and Records
              2     Lockboxes
              3     Discounted Percentage
              4     Tax Matters


        EXHIBITS

             A      Form of U.S. Dollar Subordinated Note
             BB     Form of Canadian Dollar Subordinated Note
             CC     Form of Additional Seller Supplement


                                  -iv-

<PAGE>




                    RECEIVABLES SALE AGREEMENT, dated as of July 13, 1994,
          among Collins & Aikman Products Co., a Delaware corporation ("C&A
          Products"), Ack-Ti-Lining, Inc., WCA Canada, Inc., Imperial
          Wallcoverings (Canada), Inc., Imperial Wallcoverings, Inc., The
          Akro Corporation, Dura Acquisition Corp. and each of the other
          subsidiaries of C&A Products from time to time parties hereto
          (each of the foregoing, a "Seller"), C&A Products, as Master
          Servicer (in such capacity, the "Master Servicer"), and Carcorp,
          Inc., a Delaware corporation (the "Company").


                                W I T N E S S E T H :


                    WHEREAS, in the ordinary course of business, each
          Seller generates accounts receivable; and

                    WHEREAS, each Seller desires to sell to the Company,
          and the Company is willing to purchase from such Seller, all of
          such Seller's right, title and interest in, to and under the
          Receivables (as defined herein) now existing or hereafter created
          and the rights of such Seller in, to and under all Related
          Property (as so defined) related thereto;

                    NOW, THEREFORE, in consideration of the premises and of
          the mutual covenants herein contained, the parties hereto agree
          as follows:


                                      ARTICLE I

                                     DEFINITIONS

                    1.1  Defined Terms.  Capitalized terms used in this
          Agreement shall have the respective meanings assigned to such
          terms in Annex X hereto unless otherwise defined herein.

                    1.2  Other Definitional Provisions.  (a)  The words
          "hereof", "herein" and "hereunder" and words of similar import
          when used in this Agreement shall refer to this Agreement as a
          whole and not to any particular provision of this Agreement, and
          article, section, subsection, schedule and exhibit references are
          to this Agreement unless otherwise specified.

                    (b)  As used herein and in any certificate or other
          document made or delivered pursuant hereto, accounting terms
          relating to the Sellers and the Company, unless otherwise defined
          herein, shall have the respective meanings given to them under
          generally accepted accounting principles.

                    (c)  The meanings given to terms defined herein shall
          be equally applicable to both the singular and plural forms of
          such terms.



<PAGE>



                                                                          2



                                      ARTICLE II

                           PURCHASE AND SALE OF RECEIVABLES

                    2.1  Purchase and Sale of Receivables.  (a)  By
          execution of this Agreement, each of the Sellers does hereby
          sell, transfer, assign, set over and otherwise convey, without
          recourse (except as expressly provided herein), to the Company,
          on the Effective Date, all Receivables owned by the Sellers at
          the close of business on the Effective Date and all Related
          Property in respect of such Receivables.  Subject to Article VII,
          as of each Payment Date, each of the Sellers does hereby sell,
          transfer, assign, set over and otherwise convey, without recourse
          (except as expressly provided herein), to the Company, all of its
          right, title and interest in, to and under all Receivables owned
          by the Sellers at the close of business on such Payment Date and
          not theretofore conveyed to the Company and all Related Property
          in respect of such Receivables.  The foregoing sale, transfer,
          assignment, set-over and conveyance and any subsequent sales,
          transfers, assignments, set-overs and conveyances do not
          constitute, and are not intended to result in, the creation or an
          assumption by the Company or any other Person of any obligation
          of the Sellers in connection with the Receivables or under any
          agreement or instrument relating thereto, including any
          obligation to any Obligor.

                    (b)   On the Effective Date and on the date of creation
          of each newly created Receivable, all of the applicable Seller's
          right, title and interest in and to (i) in the case of the
          Effective Date, all existing Receivables and Related Property in
          respect of such Receivables and (ii) in the case of each such
          date of creation, all such newly created Receivables and all
          Related Property in respect of such Receivables shall be
          immediately and automatically sold, assigned, transferred and
          conveyed to the Company pursuant to paragraph (a) above without
          any further action by such Seller or any other Person.  If any
          Seller shall not have received payment from the Company of the
          Purchase Price for any newly created Receivable on the Payment
          Date therefor in accordance with the terms of subsection 2.3(c),
          such newly created Receivable and the Related Property with
          respect thereto shall, upon receipt of notice from the applicable
          Seller of such failure to receive payment, immediately and
          automatically be sold, assigned, transferred and reconveyed by
          the Company to such Seller without any further action by the
          Company or any other Person.

                    (c)  In connection with the foregoing conveyances, each
          Seller agrees to record and file, or cause to be recorded and
          filed, at its own expense, financing statements (and continuation
          statements with respect to such financing statements when
          applicable), and any other similar instruments, with respect to
          the Receivables and Related Property now existing and hereafter
          acquired by the Company from the Sellers meeting the requirements
          of applicable law in such manner and in such jurisdictions as are
          necessary to perfect the purchases of the Receivables and Related
          Property by the Company from the Sellers, and to deliver evidence
          of such filings to the Company on or prior to the Effective Date. 
          The parties hereto intend that the transfer of Receivables
          effected by this Agreement be sales.

                    (d)  In connection with the foregoing conveyances, each
          Seller agrees at its own expense, as agent of the Company, that
          it will (i) indicate or cause to be indicated on the 



<PAGE>

                                                                           3


          computer files and other listings relating to the Receivables that all
          Receivables and Related Property have been sold to the Company
          and that the Company has sold an interest therein and has granted
          a security interest in the Company's retained interest therein
          and (ii) deliver or cause to be delivered to the Company computer
          files, microfiche lists or typed or printed lists containing true
          and complete lists of all such Receivables, identified by Obligor
          and by the Receivables balance as of June 15, 1994.

                    2.2  Purchase Price.  The amount payable by the Company
          to a Seller (the "Purchase Price") for newly created Receivables
          and Related Property on any Payment Date under this Agreement
          shall be equal to the product of (a) the aggregate outstanding
          Principal Amount of such Receivables as set forth in the
          applicable Daily Report and (b) the Discounted Percentage with
          respect to such Seller.  To the extent the Purchase Price of any
          Receivable is denominated in Canadian Dollars, the Dollar
          equivalent of such Purchase Price shall be equal to the Canadian
          Exchange Percentage thereof.

                    2.3  Payment of Purchase Price.  (a)  Upon fulfillment
          of the conditions set forth in Article III, the Purchase Price
          for Receivables and the Related Property shall be paid or
          provided for in the manner provided below on each day for which a
          Daily Report is prepared and delivered to the Company (each such
          day, a "Payment Date").  Each Seller hereby appoints the Master
          Servicer as its agent to receive payment of the Purchase Price
          for Receivables sold by it to the Company and hereby authorizes
          the Company to make all payments due to such Seller directly to,
          or as directed by, the Master Servicer.  The Master Servicer
          hereby accepts and agrees to such appointment.

                    (b)  The Purchase Price for Receivables and the Related
          Property with respect thereto purchased by the Company on the
          Effective Date from each Seller shall be paid by the Company as
          follows:

                    (i)  in cash from the net proceeds of the sale of an
               interest in such Purchased Receivables by the Company to
               other Persons; and

                   (ii)  in cash from the proceeds of capital contributed
               by C&A Products to the Company in respect of its equity
               interest in the Company.


                    (c)  The Purchase Price for Receivables and the Related
          Property with respect thereto purchased by the Company on any
          Payment Date after the Effective Date shall be paid by the
          Company on such Payment Date as follows:

                    (i)  by netting the amount of any Seller Adjustment
               Payments or Seller Repurchase Payments pursuant to
               subsection 2.5 or 2.6 against such Purchase Price;

                   (ii)  to the extent available for such purpose, in cash
               from Collections;  it being understood that Canadian Dollar
               cash Collections shall be applied solely to the Purchase
               Price of Canadian Dollar denominated Receivables;



<PAGE>

                                                                          4



                  (iii)  to the extent available for such purpose, in cash
               from the net proceeds of the sale of an interest in such
               Purchased Receivables by the Company to other Persons;

                   (iv)  at the option of the Company, by means of an
               addition to the principal amount of the Canadian Dollar
               Subordinated Note or U.S. Dollar Subordinated Note, as
               appropriate in accordance with this subsection, in an
               aggregate amount equal to the remaining portion of the
               Purchase Price; provided, however, that the Company may pay
               by means of additions to the principal amount of either
               Subordinated Note only if, at the time of such payment and
               after giving effect thereto, the fair market value of its
               assets, including any beneficial interests or indebtedness
               of a trust and all Receivables and Related Property it owns,
               after giving effect for this purpose to any Adjustments with
               respect to the Purchased Receivables or any participation
               interest therein sold to the Banks under the Receivables
               Transfer Agreement, is greater than the amount of its
               liabilities including its liabilities on the Subordinated
               Notes and in respect of the Purchase Discount Amounts and
               all fees payable under the Receivables Transfer Agreement. 
               Any such addition to the principal amount of the
               Subordinated Notes shall be allocated among the Sellers by
               the Master Servicer provided, however, that additions to the
               principal amount of the Canadian Dollar Subordinated Note
               may only be made to evidence the purchase price of
               Receivables denominated in Canadian Dollars and additions to
               the U.S. Dollar Subordinated Note may only be made to
               evidence the purchase price of Receivables denominated in
               Dollars.  The Master Servicer may evidence such payments by
               means of additions to the principal amount of the
               appropriate Subordinated Note by recording the date and
               amount thereof on the books and records of the Master
               Servicer or the Sellers or on the grid attached to such
               Subordinated Note; provided that the failure to make any
               such recordation or any error in such grid shall not
               adversely affect any Seller's rights; and


                    (v)  in cash from the proceeds of capital contributed
               by C&A Products to the Company in respect of its equity
               interest in the Company. 

                    (d)  The Master Servicer may allocate among the Sellers
          the payment of the Purchase Price for Receivables and any amounts
          netted therefrom pursuant to subsection 2.3(c)(i).  The Company
          shall be entitled to pay all amounts in respect of the Purchase
          Price of Receivables to an account of the Master Servicer without
          regard to whether or how such payments are allocated by the
          Master Servicer to the Sellers.  All payments under this
          Agreement (i) to the extent such payments are made in Canadian
          Dollars, shall be made on the date specified therefor in Canadian
          Dollars in same day funds or by check, as the Master Servicer
          shall elect, (ii) in all other cases, shall be made on the date
          specified therefor in Dollars in same day funds or by check, as
          the Master Servicer shall elect, (iii) in all cases, shall be
          made not later than 3:00 p.m (New York City time) and (iv) shall
          be made (x) if to any Seller, to the bank account for such Seller
          designated in writing by the Master Servicer to the Company and
          (y) if to the Master Servicer, to the bank account designated in
          writing by the Master Servicer to the Company.


<PAGE>

                                                                          5



                    (e)  Whenever any payment to be made under this
          Agreement shall be stated to be due on a day other than a
          Business Day, such payment shall be made on the next succeeding
          Business Day.  Amounts not paid when due in accordance with the
          terms of this Agreement shall bear interest at a rate equal at
          all times to the ABR plus the Applicable ABR Margin plus 2%,
          payable on demand.

                    2.4  No Repurchase.  Except to the extent expressly set
          forth herein, no Seller shall have any right or obligation under
          this Agreement, by implication or otherwise, to repurchase from
          the Company any Purchased Receivables or Related Property or to
          rescind or otherwise retroactively effect any purchase of any
          Purchased Receivables or Related Property after the Payment Date
          relating thereto.

                    2.5  Rebates, Adjustments, Returns and Reductions;
          Modifications.  From time to time a Seller may make Adjustments
          to Receivables in accordance with this subsection 2.5 and
          subsection 6.2.  The Sellers, jointly and severally, agree to pay
          to the Company, on the Payment Date immediately succeeding the
          date of the grant of any Adjustment (regardless of which Seller
          shall have granted such Adjustment), the amount of any such
          Adjustment (a "Seller Adjustment Payment"); provided, that, prior
          to any Purchase Termination Event, any such payments to the
          Company shall be netted against the Purchase Price of newly
          created Receivables in accordance with subsection 2.3(c)(i).  An
          "Adjustment" shall mean any rebate, discount, refund or
          adjustment (including, without limitation, as a result of the
          application of any special or other discounts or any
          reconciliations) of any Receivable, the amount owing for any
          returns (including, without limitation, as a result of the return
          of any stale goods) or cancellations and the amount of any other
          reduction of any payment under any Receivable in each case
          granted or made by the applicable Seller to the related Obligor,
          provided, that, an "Adjustment" does not include any Charge-Off. 
          The amount of any Adjustment shall be set forth on the first
          Daily Report prepared after the date of the grant thereof.

                    2.6  Limited Repurchase Obligation.  In the event that
          any of the representations or warranties contained in subsection
          4.2 in respect of any Receivable shall be or have been incorrect
          in any material respect as of the date made or deemed made, or
          any Eligible Receivable shall become subject to any defense,
          dispute, offset or counterclaim of any kind (other than as
          expressly permitted by this Agreement) or any Seller shall breach
          any covenant contained in subsection 5.2, 5.8, 6.1, 6.2, 6.3,
          6.4, 6.5, 6.8 or 6.9 with respect to any Receivable (each of the
          foregoing events or circumstances, a "Repurchase Event"), such
          Receivable shall cease to be an Eligible Receivable on the date
          on which such Repurchase Event occurs.  In addition, if any
          Repurchase Event shall occur with respect to any Receivable, then
          the Sellers, jointly and severally, agree to pay to the Company
          an amount (the "Repurchase Amount") equal to the Purchase Price
          of such Receivable (whether the Company paid such Purchase Price
          in cash or otherwise) less Collections received by the Company in
          respect of such Receivable, regardless of which Seller shall have
          been responsible for such Repurchase Event, such payment to occur
          on the 30th day after the day such Repurchase Event becomes known
          (or should have become known with due diligence) to any Seller
          (except that if such 30th day is not a Business Day, such payment
          shall be made on the Business Day immediately succeeding such
          30th day) unless such Repurchase Event shall have been cured on
          or before such 30th day; provided, that, prior to the occurrence of 


<PAGE>

                                                                           6


          any Purchase Termination Event, any such payments to the
          Company shall be netted against the Purchase Price of newly
          created Receivables in accordance with subsection 2.3(c)(i).  Any
          payment by any Seller pursuant to this subsection 2.6 is referred
          to as a "Seller Repurchase Payment".  If, on or prior to such
          30th day (or the Business Day immediately succeeding such 30th
          day, as applicable), any Seller shall so reacquire any such
          Receivable, then 
          the Company shall have no further remedy against the Sellers in
          respect of the Repurchase Event with respect to such reacquired
          Receivable. Upon a Seller Repurchase Payment, the Company shall
          automatically and without further action be deemed to sell,
          transfer, assign, set over and otherwise convey to the applicable
          Seller, without recourse, representation or warranty, all the
          right, title and interest of the Company in, to and under such
          Receivable and the Related Property with respect thereto.  The
          Company shall execute such documents and instruments of transfer
          or assignment and take such other actions as shall reasonably be
          requested by such Seller to effect the conveyance of such
          Receivable pursuant to this section 2.6.


                    2.7  Obligations Unaffected.  The obligations of the
          Sellers to the Company under this Agreement shall not be affected
          by reason of any invalidity, illegality or irregularity of any
          Receivable or any sale of a Receivable.

                    2.8  Certain Charges.  Each of the Sellers and the
          Company agrees that late charge revenue, reversals of discounts,
          other fees and charges and other similar items, whenever created,
          accrued in respect of Purchased Receivables shall be the property
          of the Company notwithstanding the occurrence of an Early
          Termination, and all Collections with respect thereto shall
          continue to be allocated and treated as Collections in respect of
          Purchased Receivables.

                    2.9  Certain Allocations.  Each of the Sellers hereby
          agrees that, following the occurrence of an Early Termination in
          respect of any Seller, all Collections and other proceeds
          received in respect of Receivables generated by such Seller shall
          be applied first, to pay the outstanding Principal Amount of
          Purchased Receivables (as of the date of such Early Termination)
          of the Obligor to whom such Collections are attributable until
          such Purchased Receivables are paid in full and, second, to such
          Seller to pay Receivables of such Obligor not sold to the
          Company; provided, however, that notwithstanding the foregoing,
          if any such Seller can attribute a Collection to a specific
          Obligor and a specific Receivable, then such Collection shall be
          applied to pay such Receivable of such Obligor.


                                     ARTICLE III

                           CONDITIONS TO PURCHASE AND SALE

                    3.1  Conditions Precedent to the Company's Initial
          Purchase of Receivables.  The obligation of the Company to
          purchase the Receivables and the Related Property hereunder on
          the Effective Date from any Seller is subject to the conditions
          precedent, which may be waived by the Company, that (a) each of
          the Sale Documents shall be in full force 



<PAGE>

                                                                          7


          and effect and (b) the conditions set forth below shall have been 
          satisfied on or before the Effective Date:

                    (i)  the Company shall have received copies of duly
               adopted resolutions of the Board of Directors of each Seller
               as in effect on the Effective Date and in form and substance
               reasonably satisfactory to the Company, authorizing this
               Agreement, the documents to be delivered by such Seller
               hereunder and the transactions contemplated hereby,
               certified by the Secretary or Assistant Secretary of such
               Seller;

                   (ii)  the Company shall have received duly executed
               certificates of the Secretary or an Assistant Secretary of
               each Seller, dated the Effective Date and in form and
               substance reasonably satisfactory to the Company, certifying
               the names and true signatures of the officers authorized on
               behalf of such Seller to sign this Agreement and any
               instruments or documents in connection with this Agreement;

                  (iii)  each Seller shall have filed and recorded, at its
               own expense, UCC-1 financing statements (and other similar
               instruments) with respect to the Receivables and the Related
               Property in such manner and in such jurisdictions as are
               necessary or desirable to perfect the Company's ownership
               interest thereof under the Uniform Commercial Code (or any
               other similar law) and delivered evidence of such filings to
               the Company on or prior to the Effective Date; and all other
               action necessary or desirable, in the reasonable judgment of
               the Company, to perfect the Company's ownership of the
               Receivables shall have been duly taken;

                   (iv)  each Seller shall have delivered to the Company a
               microfiche, typed or printed list or other tangible evidence
               reasonably acceptable to the Company showing as of a date no
               later than five Business Days preceding the Effective Date,
               the Obligors whose Receivables are to be transferred to the
               Company on the Effective Date and the balance of the
               Receivables with respect to each such Obligor as of such
               preceding date; and

                    (v)  the Company shall have received reports of UCC-1
               and other searches of the Sellers with respect to the
               Receivables and the Related Property reflecting the absence
               of Liens thereon, except Liens created in connection with
               the sale by the Company of an interest in the Purchased
               Receivables and except for Liens as to which the Company has
               received Uniform Commercial Code termination statements to
               be filed on or prior to the Effective Date.

                    3.2  Conditions Precedent to All the Company's
          Purchases of Receivables.  The obligation of the Company to pay a
          Seller for any Receivable and the Related Property with respect
          thereto on each Payment Date (including the Effective Date) shall
          be subject to the further conditions precedent, which may be
          waived by the Company, that on such Payment Date:

                    (a)  the following statements shall be true (and the
               acceptance by such Seller of the Purchase Price for any
               Receivables on any Payment Date shall constitute a


<PAGE>

                                                                          8



               representation and warranty by such Seller that on such
               Payment Date such statements are true):

                         (i)  the representations and warranties of such
                    Seller contained in subsections 4.1 and 4.2 shall be
                    true and correct in all material respects on and as of
                    such Payment Date as though made on and as of such
                    date, except insofar as such representations and
                    warranties are expressly made only as of another date;
                    and

                        (ii)  no Purchase Termination Event or Incipient
                    Purchase Termination Event shall have occurred and be
                    continuing; and

                       (iii)  there has been no material adverse change
                    since the date of this Agreement in the collectibility
                    of the Receivables (other than due to a change in the
                    creditworthiness of the Obligors); 

                    (b)  the Company shall be satisfied that such Seller's
               systems, procedures and record-keeping relating to the
               Purchased Receivables are in all material respects
               sufficient and satisfactory in order to permit the purchase
               and administration of the Purchased Receivables in
               accordance with the terms and intent of this Agreement (it
               being understood and agreed that as of the date hereof, the
               Sellers' systems, procedures and record-keeping relating to
               the Receivables are in all material respects sufficient and
               satisfactory);

                    (c)  the Company shall have received payment in full of
               all amounts for which payment is due from such Seller
               pursuant to subsection 2.5, 2.6 or 9.3;

                    (d)  the Company shall have received such other
               approvals, opinions or documents as the Company may
               reasonably request; and

                    (e)  such Seller shall have complied with all of its
               covenants in all material respects and satisfied all of its
               obligations in all material respects under this Agreement
               required to be complied with or satisfied as of such date;

          provided, however, that the failure of any Seller to satisfy any
          of the foregoing conditions shall not prevent such Seller from
          subsequently selling Receivables upon satisfaction of all such
          conditions or exercising its rights under subsection 2.1(b).

                    3.3  Conditions Precedent to Sellers' Obligations. 
          (a)  The obligations of each Seller on the Effective Date shall
          be subject to the conditions precedent that such Seller shall
          have received on or before the Effective Date the following, each
          dated the Effective Date and in form and substance satisfactory
          to such Seller:

                    (i)  a copy of duly adopted resolutions of the Board of
               Directors of the Company authorizing this Agreement, the
               documents to be delivered by the Company 


<PAGE>

                                                                          9



               hereunder and the transactions contemplated hereby, certified 
               by the Secretary or Assistant Secretary of the Company; and

                   (ii)  a duly executed certificate of the Secretary or
               Assistant Secretary of the Company certifying the names and
               true signatures of the officers authorized on its behalf to
               sign this Agreement and the other documents to be delivered
               by it hereunder.

                    (b)  The obligations of each Seller on each Payment
          Date shall be subject to the condition precedent that no
          Termination Event set forth in paragraph (f) of Article IX of the
          Receivables Transfer Agreement shall have occurred and be
          continuing.

                    3.4  Conditions Precedent to the Addition of a Seller. 
          No Subsidiary of C&A Products approved by the Company as an
          additional Seller pursuant to subsection 9.14 shall be added as a
          Seller hereunder unless the conditions set forth below shall have
          been satisfied on or before the date designated for the addition
          of such Seller (the "Seller Addition Date"):

                    (i)  the Company shall have received an Additional
               Seller Supplement substantially in the form of Exhibit C
               hereto, duly executed and delivered by such Seller;

                   (ii)  the Company shall have received copies of duly
               adopted resolutions of the Board of Directors of such Seller
               as in effect on the related Seller Addition Date and in form
               and substance reasonably satisfactory to the Company,
               authorizing this Agreement, the documents to be delivered by
               such Seller hereunder and the transactions contemplated
               hereby, certified by the Secretary or Assistant Secretary of
               such Seller;

                  (iii)  the Company shall have received duly executed
               certificates of the Secretary or an Assistant Secretary of
               such Seller dated the related Seller Addition Date and in
               form and substance reasonably satisfactory to the Company,
               certifying the names and true signatures of the officers
               authorized on behalf of such Seller to sign the Additional
               Seller Supplement or any instruments or documents in
               connection with this Agreement;

                   (iv)  a Lockbox Account with respect to Receivables to
               be sold by such Seller shall have been established in the
               name of the Company;

                    (v)  such Seller shall have filed and recorded, at its
               own expense, UCC-1 financing statements (and other similar
               instruments) with respect to the Receivables and the Related
               Property in such manner and in such jurisdictions as are
               necessary or desirable to perfect the Company's ownership
               interest thereof under the Uniform Commercial Code (or any
               other similar law) and delivered evidence of such filings to
               the Company on or prior to the date hereof; and all other
               action necessary or desirable, in the opinion of the
               Company, to perfect the Company's ownership of the
               Receivables shall have been duly taken;


<PAGE>

                                                                           10



                   (vi)  such Seller shall have delivered to the Company a
               microfiche, a typed or printed list or other tangible
               evidence reasonably acceptable to the Company showing as of
               a date acceptable to the Company prior to the related Seller
               Addition Date the Obligors whose Receivables are to be
               transferred to the Company and the balance of the
               Receivables with respect to each such Obligor as of such
               date; and

                  (vii)  the Company shall have received reports of UCC-1
               and other searches of such Seller with respect to the
               Receivables and the Related Property reflecting the absence
               of Liens thereon, except Liens created in connection with
               the sale by the Company of an interest in the Purchased
               Receivables and except for Liens as to which the Company has
               received Uniform Commercial Code termination statements to
               be filed on or prior to the related Seller Addition Date.


                                      ARTICLE IV

                            REPRESENTATIONS AND WARRANTIES

                    4.1  Representations and Warranties of the Sellers
          Relating to the Sellers.  Each Seller hereby represents and
          warrants to the Company on the Effective Date and on each Payment
          Date that:

                    (a)  Organization, Corporate Powers.  It (i) is a
               corporation duly organized, validly existing and in good
               standing under the laws of the jurisdiction in which it is
               incorporated, (ii) has all requisite corporate power and
               authority, and all material licenses, permits, franchises,
               consents and approvals, to own or lease its property and
               assets and to carry on its business as now conducted and as
               proposed to be conducted, (iii) is qualified and in good
               standing as a foreign corporation to do business in every
               jurisdiction where such qualification is necessary, except
               where the failure so to qualify would not have a Material
               Adverse Effect and (iv) has the corporate power and
               authority to execute, deliver and perform this Agreement and
               each of the other Sale Documents to which it is a party and
               each other agreement or instrument contemplated hereby or
               thereby to which it is or will be a party.  It does not have
               any assets or business, nor is it a party to any material
               contract within the meaning of Item 6.01(b)(10) of
               Regulation S-K of the Securities and Exchange Commission,
               other than as disclosed or referred to in the registration
               statement of which the Preliminary Prospectus is a part or
               as contemplated hereby and thereby.

                    (b)  Authorization.  The execution, delivery and
               performance by it of this Agreement and each of the other
               Sale Documents to which it is a party, the sale of
               Receivables by it hereunder and the consummation of the
               other transactions contemplated by any of the foregoing
               (collectively, the "Sale Transactions") (i) have been duly
               authorized by all requisite corporate and, if required,
               stockholder action and (ii) will not (x) violate (A) any
               provision of law, statute, rule or regulation (including,
               without limitation, Regulations G, T, U and X) or the
               certificate of incorporation or by-laws (or similar
               governing documents) of such Seller, (B) any applicable
               order of 


<PAGE>

                                                                          11


               any court or any rule, regulation or order of any
               Governmental Authority or (C) any indenture, certificate of
               designation for preferred stock, agreement or other
               instrument to which such Seller is a party or by which it or
               any of its property is bound, (y) be in conflict with,
               result in a breach of or constitute (with notice or lapse of
               time or both) a default under any such indenture, agreement
               or other instrument where any such conflict, violation,
               breach or default referred to in clause (ii)(x) or (ii)(y)
               of this subsection, individually or in the aggregate, would
               have a Material Adverse Effect or (z) result in the creation
               or imposition of any Lien upon any of its property or
               assets, except for Liens created under this Agreement and
               Liens created in connection with the sale by the Company of
               an interest in the Receivables. 

                    (c)  Enforceability.  Each of this Agreement and each
               of the other Sale Documents to which it is a party has been
               duly executed and delivered by such Seller and constitutes a
               legal, valid and binding obligation of such Seller
               enforceable against it in accordance with its terms, except
               as enforceability may be limited by bankruptcy, insolvency,
               moratorium, reorganization or other similar laws affecting
               creditors' rights generally and except as enforceability may
               be limited by general principles of equity (regardless of
               whether such enforceability is considered in a proceeding in
               equity or at law).

                    (d)  Capitalization.  All of its Capital Stock is owned
               directly or indirectly by C&A Products. 

                    (e)  Litigation; Compliance with Laws.  (1)  Except as
               described in the registration statement of which the
               Preliminary Prospectus is a part, there are not any actions,
               suits or proceedings at law or in equity or by or before any
               court or Governmental Authority now pending or, to the
               knowledge of such Seller, threatened against or affecting
               such Seller or any of its property or rights as to which
               there is a reasonable possibility of an adverse
               determination and which (i) if adversely determined, could
               individually or in the aggregate result in a Material
               Adverse Effect or (ii) involve the Transaction Documents or
               (iii) if adversely determined, could materially adversely
               affect the Sale Transactions. 

                    (2)  It is not in default with respect to any law,
               order, judgment, writ, injunction, decree, rule or
               regulation of any Governmental Authority where such default
               could have a Material Adverse Effect.  The sales hereunder
               and the use of the proceeds thereof will not violate any
               applicable law or regulation or violate or be prohibited by
               any judgment, writ, injunction, decree or order of any court
               or Governmental Authority or subject such Seller to any
               civil or criminal penalty or fine.  No Purchase Termination
               Event or Incipient Purchase Termination Event has occurred
               and is continuing.

                    (f)  Agreements.  (1)  It is not a party to any
               agreement or instrument or subject to any corporate
               restriction that has resulted or could reasonably be
               expected to result in a Material Adverse Effect.


<PAGE>

                                                                         12



                    (2)  It is not in default in any manner under any
               provision of any indenture or other agreement or instrument
               evidencing Indebtedness or any other material agreement or
               instrument to which it is a party or by which it or any of
               its properties or assets are or may be bound, in either case
               where such default could result in a Material Adverse
               Effect.  

                    (g)  Tax Returns.  It has filed or caused to be filed
               all Federal, and all material state, local and foreign, tax
               returns required to have been filed by it and has paid or
               caused to be paid all taxes shown thereon to be due and
               payable, and any assessments in excess of $2,000,000 in the
               aggregate received by it, except taxes the amount or
               validity of which are currently being contested in good
               faith by appropriate proceedings and with respect to which
               reserves in conformity with GAAP have been provided on its
               books and taxes, assessments, charges, levies or claims in
               respect of property taxes for property that it has
               determined to abandon where the sole recourse for such tax,
               assessment, charge, levy or claim is to such property.  It
               has paid in full or made adequate provision (in accordance
               with GAAP) for the payment of all taxes due with respect to
               the periods ending on or before January 29, 1994, which
               taxes, if not paid or adequately provided for, would have a
               Material Adverse Effect.  The tax returns of such Seller
               have been examined by relevant Federal tax authorities for
               all periods through January 26, 1985, and all deficiencies
               asserted as a result of such examinations have been paid. 
               Except as set forth on Schedule 4, as of the Effective Date,
               with respect to such Seller, (i) no material claims are
               being asserted in writing with respect to any taxes, (ii) no
               presently effective waivers or extensions of statutes of
               limitation with respect to taxes have been given or
               requested, (iii) no tax returns are being examined by, and
               no written notification of intention to examine has been
               received from, the Internal Revenue Service or any other
               taxing authority and (iv) no currently pending issues have
               been raised in writing by the Internal Revenue Service or
               any other taxing authority.  For purposes of this paragraph,
               "taxes" shall mean any present or future tax, levy, impost,
               duty, charge, assessment or fee of any nature (including
               interest, penalties and additions thereto) that is imposed
               by any Governmental Authority.

                    (h)  No Material Misstatements.  The information,
               reports, financial statements, exhibits and schedules
               furnished by or on behalf of such Seller to the Company in
               connection with the negotiation of any Sale Document or
               included therein or delivered pursuant thereto did not
               contain and will not contain as of the Effective Date any
               material misstatement of fact and did not omit and will not
               omit to state as of the Effective Date any material fact
               necessary to make the statements therein, in the light of
               the circumstances under which they were, are or will be
               made, not materially misleading in their presentation of the
               Sale Transactions or such Seller. 

<PAGE>

                                                                        13



                    (i)  Employee Benefit Plans.  Each of such Seller and
               each of its ERISA Affiliates is in compliance in all
               material respects with the applicable provisions of ERISA
               and the regulations and published interpretations thereunder
               except for such noncompliance which would not be expected to
               result in a Material Adverse Effect.  No Reportable Event
               has occurred as to which such Seller or any of its ERISA
               Affiliates was required to file a report with the PBGC,
               other than reports for which the 30 day notice requirement
               is waived, reports that have been filed and reports the
               failure of which to file would not result in a Material
               Adverse Effect and, as of the Effective Date, the present
               value of all benefit liabilities under each Plan of such
               Seller or any of its ERISA Affiliates (on a termination
               basis and based on those assumptions used to fund such Plan)
               did not, as of the last annual valuation report applicable
               thereto, exceed by more than $7,500,000 the value of the
               assets of such Plan.  None of such Seller or any of its
               ERISA Affiliates has incurred or could reasonably be
               expected to incur any Withdrawal Liability that could result
               in a Material Adverse Effect.  None of such Seller or any of
               its ERISA Affiliates has received any notification that any
               Multiemployer Plan is in reorganization or has been termi-
               nated within the meaning of Title IV of ERISA, and no
               Multiemployer Plan is reasonably expected to be in reorgan-
               ization or to be terminated where such reorganization or
               termination has resulted or could reasonably be expected to
               result, through increases in the contributions required to
               be made to such Plan or otherwise, in a Material Adverse
               Effect.

                    (j)  Solvency.  The fair salable value of the assets of
               such Seller exceeds the amount that will be required to be
               paid on or in respect of the existing debts and other
               liabilities (including contingent liabilities) of such
               Seller.  The assets of such Seller do not constitute
               unreasonably small capital to carry out its business as
               conducted or as proposed to be conducted.  Such Seller does
               not intend to, or believe that it will, incur debts beyond
               its ability to pay such debts as they mature (taking into
               account the Recapitalization Transactions but assuming that
               the Overallotment Option is not exercised).

                    (k)  Absence of Certain Restrictions.  No indenture,
               certificate of designation for preferred stock, agreement or
               other instrument to which such Seller or any of its
               Subsidiaries is a party will prohibit or materially
               restrain, or have the effect of prohibiting or materially
               restraining, or imposing materially adverse conditions upon,
               the sale of Receivables or the granting of Liens thereon. 

                    (l)  Indebtedness to Company.  Immediately prior to
               consummation of the transactions contemplated hereby on the
               Effective Date, it had no outstanding Indebtedness to the
               Company.

                    (m)  Lockboxes.  Set forth in Schedule 2 is a complete
               and accurate description as of the Effective Date of each
               Lockbox Account currently maintained by such Seller.  Each
               of the Lockbox Agreements, once entered into, shall be the
               legal, valid and binding obligation of the parties thereto,
               enforceable against such parties in accordance with its
               terms, except as such enforceability may be limited by
               bankruptcy, insolvency, 


<PAGE>

                                                                       14


               reorganization, moratorium or other similar laws now or 
               hereafter in effect affecting the enforcement of creditors' 
               rights in general and except as such enforceability may be 
               limited by general principles of equity (whether considered 
               in a suit at law or in equity).

                    (n)  Filings.  Upon the making of the filings and the
               performance of the acts described in the legal opinions
               delivered pursuant to subsections 6.1(b)(iii) and (iv) of
               the Receivables Transfer Agreement (which shall be made or
               performed no later than five Business Days after the
               Effective Date), all filings and other acts necessary or
               advisable (including but not limited to all filings and
               other acts necessary or advisable under the Uniform
               Commercial Code of each relevant jurisdiction) shall have
               been made or performed in order to grant the Company a first
               priority perfected ownership interest in respect of all
               Receivables.

                    (o)  Receivables Documents.  Upon the delivery, if any,
               by such Seller to the Company of licenses, rights, computer
               programs, related materials, computer tapes, disks,
               cassettes and data relating to the administration of the
               Purchased Receivables pursuant to subsection 5.15(d)(5), the
               Company shall have been furnished with all materials and
               data necessary to permit immediate collection of the
               Purchased Receivables without the participation of any
               Seller in such collection.

                    4.2  Representations and Warranties of the Sellers
          Relating to the Agreement and the Receivables.  Each Seller
          hereby represents and warrants to the Company on the Effective
          Date and on each Payment Date that with respect to the
          Receivables being paid for as of such date:

                    (a)  Receivables Description.  The microfiche, printed
               or typed list or computer file delivered pursuant to
               subsection 3.1(b)(iv) is an accurate and complete listing in
               all material respects of all its Receivables as of June 15,
               1994 and the information contained therein with respect to
               the identity of such Receivables is true and correct in all
               material respects as of such date.

                    (b)  Eligible Receivable.  Each Receivable sold by it
               hereunder and included as an Eligible Receivable in the
               calculation of Applicable Eligible Receivables Percentage
               will be, on and as of the date of such inclusion, an
               Eligible Receivable.  The aggregate outstanding Principal
               Amount of Receivables sold by it on any Payment Date is
               correctly set forth on the Seller Daily Report with respect
               to such Seller and with respect to such Payment Date.  The
               aggregate outstanding Adjusted Principal Amount of
               Receivables denominated in Canadian Dollars and sold by it
               on any Payment Date is correctly set forth on the Seller
               Daily Report with respect to such Seller and with respect to
               such Payment Date.

                    (c)  Title; No Liens.  Other than with respect to
               Receivables which such Seller states in writing (in the
               applicable Seller Daily Report or otherwise) are not
               Eligible Receivables on such date, such Seller is the sole
               legal and beneficial owner of its Receivables, and upon the
               sale of each Receivable of such Seller, the Company will


<PAGE>


                                                                        15


               become the sole legal and beneficial owner of such
               Receivable, free and clear of any Liens (except for Liens
               granted by such Seller in favor of the Company and the
               interest in such Purchased Receivables sold and the security
               interest therein granted by the Company to other Persons and
               except for Liens which are released on or prior to the
               Effective Date), and no effective financing statement or
               other instrument similar in effect covering all or any part
               of such Purchased Receivable, Related Property or
               Collections with respect thereto will at such time be on
               file against such Seller in any filing or recording office
               except such as have been filed in favor of the Company in
               accordance with this Agreement.

                    (d)  Governmental Consents.  Other than with respect to
               Receivables which such Seller states in writing (in the
               applicable Seller Daily Report or otherwise) are not
               Eligible Receivables on such date, all consents, licenses,
               approvals or authorizations of or registrations or
               declarations with any Governmental Authority required to be
               obtained, effected or given by the Company in connection
               with the conveyance of each Receivable pursuant to the
               Receivables Transfer Agreement have been duly obtained,
               effected or given and are in full force and effect.

                    (e)  Compliance With Laws. Other than with respect to
               Receivables which such Seller states in writing (in the
               applicable Seller Daily Report or otherwise) are not
               Eligible Receivables on such date, all laws, statutes, rules
               and regulations (including, without limitation, usury laws),
               applicable at the related Payment Date to any of the
               Receivables have been duly complied with by such Seller
               except to the extent any failure to so comply could not
               affect the validity or collectibility of such Receivable.

                    (f)  No Set-Off.  Other than with respect to
               Receivables which such Seller states in writing (in the
               applicable Seller Daily Report or otherwise) are not
               Eligible Receivables on such date, the Receivables are not
               subject to any defense, dispute, offset or counterclaim,
               whether arising out of the transactions represented by the
               Receivables or independently thereof and whether arising out
               of any assertion by any Obligor that its obligations in
               respect of any Receivable are, or may be, payable to a third
               party, instead of the owner of such Receivable, or
               otherwise.

                    (g)  Chief Executive Office.  The chief executive
               office of such Seller is listed opposite its name on
               Schedule 1, which office is the place where such Person is
               "located" for the purposes of Section 9-103(3)(d) of the
               Uniform Commercial Code of the State of New York, and the
               offices of such Seller where such Seller keeps its records
               concerning the Receivables are also listed in said Schedule
               opposite its name.

                    (h)  Absence of Changes.  As of the related Payment
               Date, there has not been since the date of this Agreement
               any material adverse change in the ability of such Seller,
               acting as the Servicer, to perform its obligations hereunder
               or under the Receivables Transfer Agreement.



<PAGE>


                                                                         16



                                      ARTICLE V

                                AFFIRMATIVE COVENANTS

               Each Seller hereby agrees that, so long as there are any
          amounts outstanding with respect to Purchased Receivables
          previously sold by such Seller to the Company or until an Early
          Termination with respect to such Seller, whichever is later, such
          Seller or the Master Servicer on behalf of such Seller shall:

                    5.1  Certificates; Other Information.  Furnish to the
          Company:

                    (a)  not later than 90 days after the end of each
               fiscal year and not later than 45 days after the end of each
               of the first three fiscal quarters of each fiscal year, a
               certificate of a Responsible Officer of the Master Servicer
               stating that, to the best of such Officer's knowledge, such
               Seller during such period has observed or performed all of
               its covenants and other agreements, and satisfied every
               condition, contained in the Sale Documents to which it is a
               party to be observed, performed or satisfied by it, and that
               such Officer has obtained no knowledge of any Purchase
               Termination Event or Incipient Purchase Termination Event
               except as specified in such certificate; and

                    (b)  promptly, such additional financial and other
               information as the Company may from time to time reasonably
               request.

                    5.2  Compliance with Laws, etc.  Comply in all material
          respects with its Certificate of Incorporation and by-laws and
          all laws, rules, regulations and orders of any Governmental
          Authority, whether now in effect or hereafter enacted, applicable
          to the Purchased Receivables, except to the extent that failure
          to comply therewith could not materially adversely affect the
          rights of the Company in the Purchased Receivables or the
          collectibility or validity thereof.  Each Seller will comply, in
          all material respects, with its obligations under contracts with
          Obligors relating to the Purchased Receivables except to the
          extent such compliance would result in a violation of a laws,
          rules, regulations and orders of any Governmental Authority. 

                    5.3  Preservation of Corporate Existence.  Do or cause
          to be done all things necessary to preserve, renew and keep in
          full force and effect its legal existence and maintain such legal
          existence separate from that of the Company, provided that any
          Seller may be merged or consolidated with or into any other
          Seller or C&A Products. 

                    5.4  Visitation Rights.  At any reasonable time during
          normal business hours and from time to time, in each case upon
          reasonable notice to such Seller and the Master Servicer, permit
          (i) the Company, or any of its agents or representatives, (A) to
          examine and make copies of and abstracts from the records, books
          of account and documents (including computer tapes and disks) of
          each Seller relating to the Purchased Receivables hereunder and
          (B) following the termination of the appointment of C&A Products
          as Master Servicer or of such Seller as Servicer with respect to
          the Purchased Receivables, to be present at the offices and
          properties of such Seller to administer and control the
          collection of amounts owing on the 



<PAGE>

                                                                        17



          Purchased Receivables and (ii) the Company, or any of its agents 
          or representatives, to visit the properties of such Seller 
          for the purpose of examining such records, books of account 
          and documents, and to discuss the affairs, finances and accounts 
          of such Seller relating to the Purchased Receivables or such 
          Seller's performance hereunder with any of its officers or 
          directors and with its independent certified public accountants 
          (subject to any requirements of confidentiality imposed by law 
          or contract).

                    5.5  Keeping of Records and Books of Account.  Maintain
          and implement, or cause to be maintained or implemented,
          administrative and operating procedures reasonably necessary or
          advisable for the collection of amounts owing on all Purchased
          Receivables, and, until any delivery to the Company, keep and
          maintain, or cause to be kept and maintained, all documents,
          books, records and other information reasonably necessary or
          advisable for the collection of amounts owing on all such
          Purchased Receivables and the Related Property with respect
          thereto.

                    5.6  Location of Records.  Keep its chief place of
          business and chief executive office, and the offices where it
          keeps the records concerning the Purchased Receivables (and all
          original documents relating thereto) at the locations referred to
          for it on Schedule 1 hereto or, upon 30 days' prior written
          notice to the Company, at such other locations in a jurisdiction
          where all action required by subsection 5.15(a) shall have been
          taken and completed and be in full force and effect.

                    5.7  Computer Files.  At its own cost and expense,
          retain the ledger used by such Seller as a master record of the
          Obligors and retain copies of all documents relating to each
          Obligor as custodian and agent for the Company and other Persons
          with interests in the Purchased Receivables and mark the computer
          tape or other physical records of the Purchased Receivables to
          the effect that interests in the Purchased Receivables existing
          with respect to the Obligors listed thereon have been sold to the
          Company. 

                    5.8  Policies.  Perform its obligations in accordance
          with and comply in all material respects with the Policies and
          the Company Policies and neither change nor modify the Policies
          or the Company Policies in any material respect, except with the
          prior written consent of the Company or if such changes are
          necessary under any law, rule, regulation or order of any
          Governmental Authority applicable to it; it being understood that
          material changes to the Policies and the Company Policies shall
          include, without limitation, changes to the timing of Charge-Offs
          of Receivables and changes to the creditworthiness criteria used
          in determining whether to extend credit to a Person and in
          determining the amount of such credit to extend.

                    5.9  Taxes; ERISA.  (a)  Pay and discharge promptly all
          taxes, assessments and governmental charges or levies imposed
          upon it or upon its income or profits or in respect of its
          property, before the same shall become delinquent or in default,
          as well as all lawful claims for labor, materials and supplies or
          otherwise which, if unpaid, might give rise to a Lien upon such
          properties or any part thereof; provided, however, that such
          payment and discharge shall not be required with respect to any
          such tax, assessment, charge, levy or claim so long as (i) the
          validity or amount thereof shall be contested in good faith by
          appropriate 



<PAGE>

                                                                     18


          proceedings and Holdings or such Seller, as
          applicable, shall set aside on its books adequate reserves as
          required by GAAP with respect thereto, (ii) such tax, assessment,
          charge, levy or claim is in respect of property taxes for
          property that such Seller has determined to abandon and the sole
          recourse for such tax, assessment, charge, levy or claim is to
          such property or (iii) the amount of such taxes assessments,
          charges, levies and claims and interest and penalties thereon
          does not exceed $1,000,000 in the aggregate for the Master
          Servicer and all Sellers taken as a whole.

                    (b)  (i)  Comply in all material respects with the
          applicable provisions of ERISA and (ii) furnish to the Company
          (w) as soon as possible, and in any event within 30 days after
          any Responsible Officer of such Seller or any ERISA Affiliate of
          such Seller knows or has reason to know that any Reportable Event
          has occurred that alone or together with any other Reportable
          Event could reasonably be expected to result in liability of the
          Master Servicer, such Seller or any of their ERISA Affiliates to
          the PBGC in an aggregate amount exceeding $10,000,000, a
          statement of a Financial Officer setting forth details as to such
          Reportable Event and the action proposed to be taken with respect
          thereto, together with a copy of the notice, if any, of such
          Reportable Event given to the PBGC, (x) promptly after any
          Responsible Officer learns of receipt thereof, a copy of any
          notice such Seller or any of its ERISA Affiliates may receive
          from the PBGC relating to the intention of the PBGC to terminate
          any Plan or Plans (other than a Plan maintained by any of their
          ERISA Affiliates which is considered an ERISA Affiliate only
          pursuant to subsection (m) or (o) of Section 414 of the Code) or
          to appoint a trustee to administer any Plan or Plans, (y) within
          20 days after the due date for filing with the PBGC pursuant to
          Section 412(n) of the Code a notice of failure to make a required
          installment or other payment with respect to a Plan, a statement
          of a Financial Officer setting forth details as to such failure
          and the action proposed to be taken with respect thereto,
          together with a copy of such notice given to the PBGC and (z)
          promptly after any Responsible Officer learns thereof and in any
          event within 30 days after receipt thereof by such Seller or any
          ERISA Affiliate from the sponsor of a Multiemployer Plan, a copy
          of each notice received by such Seller or such ERISA Affiliate
          concerning (I) the imposition of Withdrawal Liability or (II) a
          determination that a Multiemployer Plan is, or is expected to be,
          terminated or in reorganization, in each case within the meaning
          of Title IV of ERISA.

                    5.10  Collections.  Use its best efforts to cause any
          Obligor which currently pays its Receivables by checks mailed to
          such Seller to make future payments in respect of Receivables to
          a Lockbox Account or by wire transfer to the Collection Account,
          provided, that, prior to an Incipient Purchase Termination Event
          or a Purchase Termination Event, no Seller shall be obliged to
          make any such request of any such Obligor if such Seller
          determines in its reasonable judgment that such request could be
          detrimental to its ongoing business relationship with such
          Obligor.

                    5.11  Lockbox Agreements; Lockbox Accounts.  Within 60
          days of the Effective Date,

                    (a)  if such Seller has not established a Lockbox
               Account on the Effective Date, it shall establish one and
               enter into a Lockbox Agreement with respect thereto;


<PAGE>

                                                                        19


                    (b)  if such Seller shall not have entered into a
               Lockbox Agreement with respect to any existing Lockbox
               Account on the Effective Date, it shall enter into such a
               Lockbox Agreement.

                    5.12  Furnishing Copies, etc.  Furnish to the Company:

                    (a)  within two Business Days of the Company's request,
               but no more than once each month, a certificate of the chief
               financial officer of such Seller or of the Master Servicer
               on behalf of such Seller certifying, as of the date thereof,
               to the best knowledge of such officer, that no Purchase
               Termination Event has occurred and is continuing, and
               setting forth the computations used by the chief financial
               officer of such Seller in making such determination or if
               one has so occurred specifying the nature and extent thereof
               and any corrective action taken or proposed to be taken with
               respect thereto;

                    (b)  promptly upon obtaining knowledge of the
               occurrence of any Purchase Termination Event or Incipient
               Purchase Termination Event, written notice thereof;

                    (c)  promptly following request therefor, such other
               information, documents, records or reports regarding or with
               respect to the Purchased Receivables of the applicable
               Seller, as the Company may from time to time reasonably
               request;

                    (d)  promptly upon obtaining knowledge of the
               occurrence thereof, written notice of any event of default
               or default under any other Sale Document;

                    (e)  promptly upon obtaining knowledge of the
               occurrence thereof, written notice of any development that
               has resulted in, or could reasonably be expected to result
               in, a Material Adverse Effect; and

                    (f)  promptly upon determining that any Purchased
               Receivable designated as an Eligible Receivable on the
               applicable Daily Report or Settlement Statement was not an
               Eligible Receivable as of the date provided therefor,
               written notice of such determination.

                    5.13  Obligations with Respect to Obligors and
          Receivables.  Take all actions on its part reasonably necessary
          to maintain in full force and effect its material rights under
          all contracts relating to the Purchased Receivables.

                    5.14  Responsibilities of the Sellers.  Notwithstanding
          anything herein to the contrary, (i) each Seller shall perform or
          cause to be performed all its obligations under the Policies and
          the Company Policies related to the Purchased Receivables to the
          same extent as if such Purchased Receivables had not been
          transferred to the Company hereunder, (ii) the exercise by the
          Company of any of its rights hereunder shall not relieve any
          Seller of its obligations with respect to such Purchased
          Receivables and (iii) except as provided by law, the Company
          shall not have any obligation or liability with respect to any
          Purchased 



<PAGE>

                                                                         20


          Receivables, nor shall the Company be obligated to
          perform any of the obligations or duties of any Seller
          thereunder.

                    5.15  Further Action.  In addition to the foregoing:

                    (a)  Each Seller agrees that from time to time, at its
               expense, it will promptly execute and deliver all further
               instruments and documents, and take all further action, that
               may be necessary or desirable in such Seller's reasonable
               judgment or that the Company may reasonably request, in
               order to protect or more fully evidence the Company's right,
               title and interest in the Purchased Receivables, or to
               enable the Company to exercise or enforce any of its rights
               in respect thereof.  Without limiting the generality of the
               foregoing, each Seller will upon the request of the Company
               (A) execute and file such financing or continuation
               statements, or amendments thereto, and such other
               instruments or notices, as may be necessary or, in the
               opinion of the Company, advisable, (B) indicate on its books
               and records that the Purchased Receivables have been
               purchased by the Company and that the Company has sold an
               interest therein and has granted a security interest therein
               in the Company's retained interest, and provide to the
               Company, upon request, copies of any such records, and (C)
               obtain the agreement of any Person having a Lien on any
               Receivables owned by any Seller (other than any Lien created
               or imposed hereunder or any Lien expressly permitted
               pursuant to subsection 6.1) to release such Lien upon the
               purchase of any such Receivables by the Company.

                    (b)  Each Seller hereby irrevocably authorizes the
               Company to file one or more financing or continuation
               statements (and other similar instruments), and amendments
               thereto, relative to all or any part of the Purchased
               Receivables and the Related Property sold or to be sold by
               such Seller without the signature of such Seller to the
               extent permitted by applicable law.

                    (c)  If any Seller fails to perform any of its
               agreements or obligations under this Agreement, the Company
               may (but shall not be required to) perform, or cause
               performance of, such agreements or obligations, and the
               expenses of the Company incurred in connection therewith
               shall be payable by such Seller as provided in subsection
               9.3.

                    (d)  Each Seller agrees that, upon the occurrence and
               during the continuation of a Purchase Termination Event,
               Incipient Purchase Termination Event or a Servicer Event of
               Default:

                         (1)  the Company (and its assignees) shall have
                    the right at any time to notify, or require that any
                    Seller at such Seller's expense notify, the respective
                    Obligors of the Company's ownership of the Purchased
                    Receivables and may direct that payment of all amounts
                    due or to become due under the Purchased Receivables be
                    made directly to the Company or its designee;


<PAGE>

                                                                        21


                         (2)  the Company (and its assignees) shall have
                    the right to (x) sue for collection on any Purchased
                    Receivables or (y) sell any Purchased Receivables to
                    any Person for a price that is acceptable to the
                    Company.  If required by the terms of Section 9-504 or
                    9-505 of the Uniform Commercial Code, the Company (and
                    its assignees) may offer to sell any Purchased
                    Receivable to any Person, together, at its option, with
                    all other Purchased Receivables created by the same
                    Obligor.  Any Purchased Receivable sold hereunder shall
                    cease to be a Receivable for all purposes under this
                    Agreement as of the effective date of such sale;

                         (3)  each Seller shall, upon the Company's written
                    request and at such Seller's expense, (x) assemble all
                    such Seller's documents, instruments and other records
                    (including credit files and computer tapes or disks)
                    that (1) evidence or will evidence or record
                    Receivables sold by such Seller and (2) are otherwise
                    necessary or desirable to effect Collections of such
                    Purchased Receivables (collectively, the "Documents")
                    and (y) deliver the Documents to the Company or its
                    designee at a place designated by the Company.  In
                    recognition of each Seller's need to have access to any
                    Documents which may be transferred to the Company
                    hereunder, whether as a result of its continuing
                    business relationship with any Obligor for Receivables
                    purchased hereunder or as a result of its
                    responsibilities as Servicer, the Company hereby grants
                    to the applicable Seller an irrevocable license to
                    access the Documents transferred by such Seller to
                    Company and to access any such transferred computer
                    software in connection with any activity arising in the
                    ordinary course of such Seller's business or in
                    performance of such Seller's duties as Servicer,
                    provided that such Seller shall not disrupt or
                    otherwise interfere with the Company's use of and
                    access to the Documents and its computer software
                    during such license period;

                         (4)  each Seller hereby irrevocably authorizes the
                    Company or its designee to take any and all steps in
                    such Seller's name necessary or desirable, in the
                    reasonable opinion of the Company, to collect all
                    amounts due under the Purchased Receivables, including
                    endorsing such Seller's name on checks and other
                    instruments representing Collections, enforcing the
                    Purchased Receivables and exercising all rights and
                    remedies in respect thereof; and

                         (5)  upon written request of the Company, each
                    Seller will (x) deliver to the Company or a party
                    designated by the Company all licenses, rights,
                    computer programs, related material, computer tapes,
                    disks, cassettes and data necessary to the immediate
                    collection of the Purchased Receivables by the Company,
                    with or without the participation of any Seller
                    (excluding software licenses which by their terms are
                    not permitted to be so delivered, provided, that such
                    Seller shall use its best efforts to obtain the consent
                    of the relevant licensor to such delivery) and (y) make
                    such arrangements with respect to the collection of the
                    Purchased Receivables as may be reasonably required by
                    the Company.


<PAGE>

                                                                       22


                    5.16  Certain Procedures.  Each Seller shall take, or
          refrain from taking, as the case may be, all actions that are
          necessary to be taken or not taken in order to (a) ensure that
          the assumptions and factual recitations set forth in the
          Specified Bankruptcy Opinion Provisions remain true and correct
          with respect to such Seller and (b) comply with those procedures
          described in such provisions which are applicable to such Seller.


                                      ARTICLE VI

                                  NEGATIVE COVENANTS

                    Each Seller hereby agrees that, so long as there are
          any amounts outstanding with respect to Purchased Receivables
          previously sold by such Seller to the Company or until an Early
          Termination with respect to such Seller, whichever is later, such
          Seller shall not, directly or indirectly:

                    6.1  Liens.  Except as otherwise expressly herein
          provided, sell, assign (by operation of law or otherwise) or
          otherwise dispose of, or create or suffer to exist any Lien upon
          or with respect to, any Receivables or Related Property, or
          assign any right to receive proceeds in respect thereof except
          for Liens created or imposed hereunder or under the Receivables
          Transfer Agreement.

                    6.2  Extension or Amendment of Receivables.  Extend,
          make any Adjustment to, rescind, cancel, amend or otherwise
          modify, or attempt or purport to extend, amend or otherwise
          modify, the terms of any Purchased Receivables, except (i) in
          accordance with the terms of the Policies and the Company
          Policies, (ii) as required by any Requirement of Law, (iii) in
          the case of Adjustments, upon making an Adjustment Payment
          pursuant to subsection 2.5, or (iv) with the consent of the
          Company, provided that the applicable Servicer may cause
          Receivables to become Charge-Offs.

                    6.3  Change in Payment Instructions to Obligors. 
          Instruct any Obligor of any Purchased Receivables to make any
          payments with respect to any Receivables other than in accordance
          with its current practices with respect to such Obligor; provided
          that, in accordance with subsection 5.10, it may instruct any
          Obligor to make such payments to a Lockbox Account or by wire
          transfer to the Collection Account.

                    6.4  Change in Name.  Change its name, identity or
          corporate structure in any manner which would or might make any
          financing statement or continuation statement (or other similar
          instrument) relating to this Agreement seriously misleading
          within the meaning of Section 9-402(7) of the Uniform Commercial
          Code (or any other similar law) without 30 days' prior written
          notice to the Company.

                    6.5  Modification of Ledger.  Delete or otherwise
          modify the marking on the ledger referred to in subsection 5.7.



<PAGE>

                                                                        23



                    6.6  Business of the Sellers.  (a) Engage at any time
          in any business or business activity other than the business
          currently conducted by it and business activities reasonably
          incidental thereto or (b) fail to maintain and operate such
          business in substantially the manner in which it is presently
          conducted and operated if such failure would materially adversely
          affect the interests of the Company under the Transaction
          Documents. 

                    6.7  Accounting of Purchases.  Prepare any financial
          statements which shall account for the transactions contemplated
          hereby (other than capital contributions and the Subordinated
          Notes) in any manner other than as sales of the Purchased
          Receivables by such Seller to the Company or in any other respect
          account for or treat the transactions contemplated hereby
          (including for accounting purposes and, where taxes are not
          consolidated, for tax reporting purposes, except as required by
          law) (other than capital contributions and the Subordinated
          Notes) in any manner other than as sales of the Purchased
          Receivables by such Seller to the Company.

                    6.8  Chattel Paper.  Not take any action to cause any
          Receivable to be evidenced by any instrument (as defined in the
          Uniform Commercial Code as in effect in the State of New York)
          except in connection with the enforcement or collection of a
          Receivable.

                    6.9  Ineligible Receivables.  Without the prior written
          approval of the Company, take any action to cause, or which would
          permit, an Eligible Receivable to cease to be an Eligible
          Receivable, except as otherwise expressly provided by this
          Agreement.

                                     ARTICLE VII

                             PURCHASE TERMINATION EVENTS

                    If any of the following events (herein called "Purchase
          Termination Events") shall have occurred and be continuing:

                    (a)  any Seller shall fail (i) to pay any amount due
               pursuant to subsection 2.6 in accordance with the provisions
               thereof and such failure shall continue unremedied for a
               period of five days from the earlier of (A) the date any
               officer of such Seller obtains knowledge of such default and
               (B) the date such Seller receives notice of such default
               from the Company or (ii) to pay any other amount required to
               be paid by such Seller hereunder within two Business Days of
               the date when due; or

                    (b)  any Seller shall fail to observe or perform any
               covenant or agreement applicable to it contained in
               subsection 5.6, 5.7, 5.12 or 5.15(a), provided no such
               failure shall constitute a Purchase Termination Event under
               this paragraph (b) unless such default shall continue
               unremedied for 10 consecutive days; or

                    (c)  any Seller shall fail to observe or perform any
               covenant or agreement applicable to it contained in
               subsection 5.2, 5.8, 6.1, 6.2, 6.3, 6.4, 6.5, 6.8 or 6.9;
               provided that a Purchase Termination Event shall not be
               deemed to have occurred under this paragraph (c) based upon
               a failure to observe a covenant contained in 


<PAGE>

                                                                         24


               subsection 5.2, 5.8, 6.1, 6.2, 6.3, 6.4, 6.5, 6.8 or 6.9 if 
               the Sellers shall have complied with the provisions of 
               subsection 2.6 in respect thereof; or

                    (d)  any Seller shall fail to observe or perform any
               covenant or agreement applicable to it contained herein
               (other than as specified in paragraph (a), (b) or (c) of
               this Article VII), provided that no such failure shall
               constitute a Purchase Termination Event under this paragraph
               (d) unless such default shall continue unremedied for a
               period of 30 consecutive days from the earlier of (A) the
               date any Responsible Officer of such Seller obtains
               knowledge of such default and (B) the date such Seller
               receives notice of such default from the Company; or

                    (e)  any representation, warranty, certification or
               statement made or deemed made by any Seller in this
               Agreement or in any statement, record, certificate,
               financial statement or other document delivered pursuant to
               this Agreement shall prove to have been false or misleading
               in any material respect on or as of the date made or deemed
               made, provided, that a Purchase Termination Event shall not
               be deemed to have occurred under this paragraph (e) based
               upon a breach of any representation or warranty set forth in
               subsection 4.2 if the Sellers shall have complied with the
               provisions of subsection 2.6 in respect thereof; or

                    (f)  (i)  an involuntary proceeding shall be commenced
               or an involuntary petition shall be filed in a court of
               competent jurisdiction seeking (x) relief in respect of any
               Seller or of a substantial part of the property or assets of
               any Seller under Title 11 of the United States Code, as now
               constituted or hereafter amended, or any other Federal,
               state or foreign bankruptcy, insolvency, receivership or
               similar law, (y) the appointment of a receiver, trustee,
               custodian, sequestrator, conservator or similar official for
               any Seller or for a substantial part of the property or
               assets of any Seller or (z) the winding-up or liquidation of
               any Seller; and such proceeding or petition shall continue
               undismissed for 60 days or an order or decree approving or
               ordering any of the foregoing shall be entered; or (ii) any
               Seller shall (t) voluntarily commence any proceeding or file
               any petition seeking relief under Title 11 of the United
               States Code, as now constituted or hereafter amended, or any
               other Federal, state or foreign bankruptcy, insolvency,
               receivership or similar law, (u) consent to the institution
               of, or fail to contest in a timely and appropriate manner,
               any proceeding or the filing of any petition described in
               clause (f)(i) above, (v) apply for or consent to the
               appointment of a receiver, trustee, custodian, sequestrator,
               conservator or similar official for such Seller or for a
               substantial part of the property or assets of such Seller,
               (w) file an answer admitting the material allegations of a
               petition filed against it in any such proceeding, (x) make a
               general assignment for the benefit of creditors, (y) become
               unable, admit in writing its inability or fail generally to
               pay its debts as they become due or (z) take any action for
               the purpose of effecting any of the foregoing; or

                    (g)  there shall have occurred a Termination Event
               under the Receivables Transfer Agreement or the Commitments
               shall have terminated thereunder;  


<PAGE>

                                                                    25



          then, (x) in the case of any Purchase Termination Event described
          in paragraph (f) above with respect to any Seller, automatically
          the obligation of the Company to purchase Receivables from such
          Seller shall thereupon terminate without notice of any kind,
          which is hereby waived by the Sellers and (y) in the case of any
          Purchase Termination Event, so long as such Purchase Termination
          Event shall be continuing, the Company may terminate its
          obligation to purchase Receivables from any or all of the Sellers
          by written notice to each such Seller (any termination pursuant
          to clause (x) or (y) of this Article VII which affects a Seller
          is herein called an "Early Termination" with respect to such
          Seller).


                                     ARTICLE VIII

                                THE SUBORDINATED NOTES

                    8.1  Subordinated Notes.  On the Effective Date, the
          Company shall issue to the Sellers (i) a subordinated note
          substantially in the form of Exhibit A (the "U.S. Dollar
          Subordinated Note") and (ii) a subordinated note substantially in
          the form of Exhibit B (the "Canadian Dollar Subordinated Note";
          each, a "Subordinated Note" and collectively, the "Subordinated
          Notes").  The aggregate principal amount of the Subordinated
          Notes at any time shall be equal to the difference between (a)
          the aggregate principal amount on the issuance thereof and each
          addition to the principal amount of each Subordinated Note with
          respect to each Seller pursuant to the terms of subsection 2.3
          minus (b) the aggregate amount of all payments made in respect of
          the principal of the Subordinated Notes.  All payments made in
          respect of the Subordinated Notes shall be allocated among the
          Sellers by the Master Servicer.  Each Seller's interest in the
          Subordinated Notes shall equal the sum of each addition thereto
          allocated to such Seller pursuant to subsection 2.3(c) less the
          sum of each repayment thereof allocated to such Seller.  Interest
          on the principal amount of each Subordinated Note shall accrue on
          the last day of each fiscal month of the Sellers at the ABR from
          and including the Effective Date and shall be paid on each
          Settlement Date with respect to amounts accrued and not paid as
          of the last day of the preceding Settlement Period and/or the
          maturity date thereof provided, however, that accrued interest on
          a Subordinated Note which is not so paid may be added to the
          principal amount of such Subordinated Note. Principal not prepaid
          pursuant to the terms hereof and of the other Sale Documents
          shall be payable on the maturity date thereof.  Default in the
          payment of principal or interest under either Subordinated Note
          shall not constitute a default or event of default or a Purchase
          Termination Event hereunder or a Termination Event under the
          Receivables Transfer Agreement.

                    8.2  Restrictions on Transfer of Subordinated Notes. 
          Neither any Subordinated Note, nor any right of any Seller to
          receive payments thereunder, shall be assigned, transferred,
          exchanged, pledged, hypothecated, participated or otherwise
          conveyed; provided, however, that any Seller may pledge its
          rights to receive payments under either Subordinated Note to the
          lenders under the Credit Agreement subject to the conditions that
          the Collateral Agent and any present or future holder or
          beneficiary of such right to receive payments under a
          Subordinated Note agrees, in its capacity as such, to be bound by
          all the terms and conditions of this Agreement, including without
          limitation, subsection 9.16 hereof.


<PAGE>

                                                                        26



                                      ARTICLE IX

                                    MISCELLANEOUS

                    9.1  Further Assurances.  (a)  Each Seller agrees, from
          time to time, to do and perform any and all acts and to execute
          any and all further instruments reasonably required or requested
          by the Company more fully to effect the purposes of this
          Agreement and the sales of the Receivables hereunder, including,
          without limitation, the execution of any financing statements or
          continuation statements (and other similar instruments) relating
          to the Receivables for filing under the provisions of the Uniform
          Commercial Code, or any similar law, of any applicable
          jurisdiction.

                    (b)  From time to time at the request of a Seller, the
          Company shall deliver to such Seller such documents, assignments,
          releases and instruments of termination as such Seller may
          reasonably request to evidence the reconveyance by the Company to
          such Seller of a Receivable pursuant to the terms of subsection
          2.1(b) or 2.6, provided that the Company shall have been paid all
          amounts due thereunder; and the Company and the Master Servicer
          shall take such action as such Seller may reasonably request, at
          the expense of such Seller, to assure that any such Receivable,
          the Related Property with respect thereto and the proceeds
          thereof do not remain commingled with Collections hereunder.

                    9.2  Payments.  Each cash payment to be made by any of
          the Company or the Sellers hereunder shall be made on the
          required payment date and in immediately available funds at the
          office of the payee set forth below its signature hereto or to
          such other office as may be specified by either party in a notice
          to the other party hereto and (x) with respect to payments on
          account of Receivables denominated in Canadian Dollars, in
          Canadian Dollars except to the extent provided otherwise in
          Article II hereof and (ii) in all other cases, in Dollars.

                    9.3  Costs and Expenses.  The Sellers, jointly and
          severally, agree (a) to pay or reimburse the Company for all its
          out-of-pocket costs and expenses incurred in connection with the
          preparation and execution of, and any amendment, supplement or
          modification to, this Agreement, the other Sale Documents and any
          other documents prepared in connection herewith and therewith,
          the consummation and administration of the transactions
          contemplated hereby and thereby, including, without limitation,
          all reasonable and documented fees and disbursements of counsel,
          (b) to pay or reimburse the Company for all its costs and
          expenses incurred in connection with the enforcement or
          preservation of any rights under this Agreement and any of the
          other Related Documents, including, without limitation, the
          reasonable fees and disbursements of counsel to the Company, (c)
          to pay, indemnify, and hold the Company harmless from, any and
          all recording and filing fees and any and all liabilities with
          respect to, or resulting from any delay in paying, stamp, excise
          and other similar taxes, if any, which may be payable or
          determined to be payable in connection with the execution and
          delivery of, or consummation or administration of any of the
          transactions contemplated by, or any amendment, supplement or
          modification of, or any waiver or consent under or in respect of,
          this Agreement and any such other documents, (d) to pay,
          indemnify, and hold the 


<PAGE>

                                                                      27



          Company harmless from, any and all Canadian withholding taxes which 
          may be imposed in respect of the Receivables or in connection with 
          the Sale Transactions, and (e) to pay, indemnify, and hold the 
          Company harmless from and against any and all other liabilities, 
          obligations, losses, damages, penalties, actions, judgments, suits, 
          costs, expenses or disbursements of any kind or nature whatsoever 
          (i) which may at any time be imposed on, incurred by or asserted 
          against the Company in any way relating to or arising out of this 
          Agreement or the transactions contemplated hereby or in connection 
          herewith or any action taken or omitted by the Company under or in
          connection with any of the foregoing (all such other liabilities,
          obligations, losses, damages, penalties, actions, judgments,
          suits, costs, expenses and disbursements being herein called
          "Indemnified Liabilities") or (ii) which would not have been
          imposed on, incurred by or asserted against the Company but for
          its having purchased the Receivables hereunder, provided, that
          such indemnity shall not be available to the extent that such
          losses, claims, damages, liabilities or related expenses are
          determined by a court of competent jurisdiction by final and
          nonappealable judgment to have resulted from the gross negligence
          or wilful misconduct of the Company, and provided, further, that
          the Sellers shall have no obligation under this subsection 9.3 to
          the Company with respect to Indemnified Liabilities arising from
          (i) any action taken, or omitted to be taken, by a Servicer which
          is not an Affiliate of the Sellers, (ii) any Eligible Receivable
          which becomes a Charge-Off as a result of non-payment by the
          Obligor with respect thereto or (iii) any action taken by the
          Banks or the Company at the direction of the Administrative Agent
          in collecting from an Obligor.  The agreements in this subsection
          shall survive the collection of all Receivables, the termination
          of this Agreement and the payment of all amounts payable
          hereunder.

                    9.4  Successors and Assigns.  This Agreement shall be
          binding upon and inure to the benefit of the Sellers and the
          Company and their respective successors (whether by merger,
          consolidation or otherwise) and assigns.  Except as expressly
          permitted pursuant to subsections 8.2 and 8.4, each Seller agrees
          that it will not assign or transfer all or any portion of its
          rights or obligations hereunder without the prior written consent
          of the Company.  The Sellers acknowledge that the Company shall
          assign all of its rights hereunder to the Banks and, after the
          termination of the Receivables Transfer Agreement, to another
          entity or entities (each, a "Subsequent Financing Party") buying
          an interest in the Receivables.  Each Seller consents to such
          assignment and agrees that the Administrative Agent and the
          Banks, to the extent provided in the Receivables Transfer
          Agreement, and each Subsequent Financing Party to the extent
          provided in the documents to which it is a party, shall be
          entitled to enforce the terms of this Agreement and the rights
          (including, without limitation, the right to grant or withhold
          any consent or waiver) of the Company directly against such
          Seller, whether or not a Purchase Termination Event or a
          Termination Event has occurred.  Each Seller further agrees that,
          in respect of its obligations hereunder, it will act at the
          direction of and in accordance with all requests and instructions
          from the Administrative Agent or such Subsequent Financing Party,
          as the case may be, until all amounts due to the Banks or such
          Subsequent Financing Party, as the case may be, are paid in full. 
          Each of the Administrative Agent and each such Subsequent
          Financing Party shall have the rights of third-party
          beneficiaries under this Agreement.

                    9.5  GOVERNING LAW.  THIS AGREEMENT AND THE RIGHTS AND
          OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT SHALL BE 


<PAGE>

                                                                         28


          GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE 
          LAW OF THE STATE OF NEW YORK.

                    9.6  No Waiver; Cumulative Remedies.  No failure to
          exercise and no delay in exercising, on the part of the Company,
          any right, remedy, power or privilege hereunder, shall operate as
          a waiver thereof, nor shall any single or partial exercise of any
          right, remedy, power or privilege hereunder preclude any other or
          further exercise thereof or the exercise of any other right,
          remedy, power or privilege.  The rights, remedies, powers and
          privileges herein provided are cumulative and not exhaustive of
          any rights, remedies, powers and privileges provided by law.


                    9.7  Amendments and Waivers.  Neither this Agreement
          nor any terms hereof may be amended, supplemented or modified
          except in a writing signed by the Company and any affected
          Seller.

                    9.8  Severability.  Any provision of this Agreement
          which is prohibited or unenforceable in any jurisdiction shall,
          as to such jurisdiction, be ineffective to the extent such
          prohibition or unenforceability without invalidating the
          remaining provisions hereof, and any such prohibition or
          unenforceability in any jurisdiction shall not invalidate or
          render unenforceable such provision in any other jurisdiction.

                    9.9  Notices.  All notices, requests and demands to or
          upon the respective parties hereto to be effective shall be in
          writing (including by telecopy), and, unless otherwise expressly
          provided herein, shall be deemed to have been duly given or made
          when delivered by hand, or three days after being deposited in
          the mail, postage prepaid, or, in the case of telecopy notice,
          when received, addressed as follows in the case of the Company
          and C&A Products, and as set forth on Schedule 1 hereof in the
          case of the Sellers, or to such other address as may be hereafter
          notified by the respective parties hereto:

               The Company:        Carcorp, Inc.
                                   5025 S. Eastern Avenue

                                   Suite 16, Number 205
                                   Las Vegas, Nevada  89119
                                   Attention:
                                   Telecopy:

               C&A Products:       Collins & Aikman Products Co.
                                   701 McCullough Drive
                                   Charlotte, North Carolina  28262
                                   Attention:  Mark Remissong
                                   Telecopy:  704-548-2330


                    9.10  Counterparts.  This Agreement may be executed by
          one or more of the parties to this Agreement on any number of
          separate counterparts (including by telecopy), and all of said
          counterparts taken together shall be deemed to constitute one and
          the same 


<PAGE>

                                                                       29



          instrument.  A set of the copies of this Agreement
          signed by all the parties shall be lodged with the Company.

                    9.11  Construction of Agreement as Security Agreement.
          (a)  The parties to this Agreement intend that the transactions
          contemplated hereby shall be, and shall be treated as, a purchase
          by the Company and a sale by the applicable Seller of the
          Purchased Receivables and Related Property with respect thereto
          and not as a lending transaction.  If, however, notwithstanding
          the intent of the parties, such transactions are deemed to be
          loans, each Seller hereby grants to the Company a first priority
          security interest in all of such Seller's right, title and
          interest in and to the Receivables and the Related Property now
          existing and hereafter created, all monies due or to become due
          and all amounts received with respect thereto, including, without
          limitation, Recoveries, and all "proceeds" thereof, to secure all
          such Seller's obligations hereunder.

                    (b)  This Agreement shall constitute a security
          agreement under applicable law.

                    9.12  Waivers of Jury Trial.  Each party hereto hereby
          waives, to the fullest extent permitted by applicable law, any
          right it may have to a trial by jury in respect of any litigation
          directly or indirectly arising out of, under or in connection
          with this Agreement or any of the other Sale Documents.  Each
          party hereto (a) certifies that no representative, agent or
          attorney of any other party has represented, expressly or
          otherwise, that such other party would not, in the event of
          litigation, seek to enforce the foregoing waiver and (b)
          acknowledges that it and the other parties hereto have been
          induced to enter into this Agreement and the other Sale
          Documents, as applicable, by, among other things, the mutual
          waivers and certifications in this subsection 9.12.

                    9.13  Jurisdiction; Consent to Service of Process.  (a)
          Each party hereto hereby irrevocably and unconditionally submits,
          for itself and its property, to the nonexclusive jurisdiction of
          any New York State court or Federal court of the United States of
          America sitting in New York City, and any appellate court from
          any thereof, in any action or proceeding arising out of or
          relating to this Agreement or the other Sale Documents, or for
          recognition or enforcement of any judgment, and each of the
          parties hereto hereby irrevocably and unconditionally agrees that
          all claims in respect of any such action or proceeding may be
          heard and determined in such New York State or, to the extent
          permitted by law, in such Federal court.  Each of the parties
          hereto agrees that a final judgment in any such action or
          proceeding shall be conclusive and may be enforced in other
          jurisdictions by suit on the judgment or in any other manner
          provided by law.  Nothing in this Agreement shall affect any
          right that the Company may otherwise have to bring any action or
          proceeding relating to this Agreement or the other Sale Documents
          against any Seller or its properties in the courts of any
          jurisdiction.

               (b)  Each party hereto hereby irrevocably and
          unconditionally waives, to the fullest extent they may legally
          and effectively do so, any objection which it may now or
          hereafter have to the laying of venue of any suit, action or
          proceeding arising out of or relating to this Agreement or the
          other Sale Documents in any New York State or Federal court. 
          Each of the 


<PAGE>

                                                                       30


          parties hereto hereby irrevocably waives, to the
          fullest extent permitted by law, the defense of an inconvenient
          forum to the maintenance of such action or proceeding in any such
          court.

               (c)  Each party to this Agreement irrevocably consents to
          service of process in the manner provided for notices in
          subsection 9.9.  Nothing in this Agreement will affect the right
          of any party to this Agreement to serve process in any other
          manner permitted by law.

                    9.14  Addition of Sellers.  Subject to subsection 3.4
          hereof, subsection 8.22 of the Receivables Transfer Agreement and
          the terms and conditions of this subsection 9.14, from time to
          time one or more additional Subsidiaries of C&A Products may
          become Sellers hereunder and parties hereto.  If any such
          Subsidiary wishes to become an additional Seller, it shall submit
          a request to such effect in writing to the Company.  The Company,
          in its sole and absolute discretion, may agree to or deny any
          such request, provided that, if the Company shall have failed to
          respond to any such request within 30 days after receipt thereof,
          such request shall be deemed to have been denied.  If the Company
          shall have agreed to any such request, such Subsidiary shall
          become an additional Seller hereunder and a party hereto on the
          related Seller Addition Date upon satisfaction of the conditions
          set forth in subsection 3.4.

                    9.15  Optional Termination of Seller.  (a) Any Seller
          may be terminated as a Seller hereunder on the date such Seller
          ceases to be a wholly owned direct or indirect Subsidiary of C&A
          Products, provided (i) that the aggregate outstanding Adjusted
          Principal Amount of Purchased Receivables sold by all Sellers
          which so cease to be wholly owned Subsidiaries at such time
          (together with the aggregate outstanding Adjusted Principal
          Amount of Purchased Receivables sold by all Sellers which have
          been terminated pursuant to this subsection 9.15 within the
          preceding 90 days) shall not exceed 10% of the aggregate
          outstanding Adjusted Principal Amount of all Purchased
          Receivables and (ii) that no Purchase Termination Event or
          Incipient Purchase Termination Event has occurred and is
          continuing, or would result as a result thereof.  From and after
          the date any such Seller ceases to be a wholly owned Subsidiary
          of C&A Products, the Company shall cease buying Receivables and
          Related Property from such Seller.  Each such Seller shall be
          released as a Seller party hereto for all purposes and shall
          cease to be a party hereto on the date on which there are no
          amounts outstanding with respect to Purchased Receivables
          previously sold by such Seller to the Company, whether such
          amounts have been repurchased, collected or written off in
          accordance with the Policies and the Company Policies.  Prior to
          such date, such Seller shall be obligated to perform its
          servicing and other obligations hereunder and under the
          Transaction Documents to which it is a party with respect to
          Purchased Receivables previously sold by such Seller to the
          Company, including, without limitation, its obligation to deposit
          Collections into the appropriate Lockboxes.


                    (b)  From time to time the Sellers, or the Master
          Servicer on behalf of the Sellers, may request in writing that
          the Company designate one or more Sellers as Sellers that shall
          cease to be parties to this Agreement; provided that no Purchase
          Termination Event or Incipient Purchase Termination Event has
          occurred and is continuing, or would result as a result thereof. 
          Any such request shall specify the minimum aggregate Adjusted
          Principal Amount of outstanding Purchased Receivables to have
          been sold by the Sellers to be so designated by the Company.  The
          Company, in its sole and absolute discretion (subject to


<PAGE>

                                                                       31


          subsection 8.23 of the Receivables Transfer Agreement), shall,
          within 45 days of receipt of such request, select the Sellers to
          be so terminated, provided that the aggregate Adjusted Principal
          Amount of outstanding Purchased Receivables previously sold by
          such Sellers shall be substantially equal to the Adjusted
          Principal Amount specified in such request.  Promptly after
          receipt of any such designation by the Company, the Sellers shall
          either (i) elect not to terminate such designated Sellers or (ii)
          select a date, which date shall not be later than 30 days after
          the date of receipt of such designation, as the "Sale Termination
          Date" for such designated Sellers.  From and after such date, the
          Company shall cease buying Receivables and Related Property from
          such Sellers.  Each such Seller shall be released as a Seller
          hereunder and a party hereto for all purposes and shall cease to
          be a party hereto on the date on which there are no amounts
          outstanding with respect to Purchased Receivables previously sold
          by such Seller to the Company, whether such amounts have been
          repurchased in the manner provided in clause (a) above, collected
          or written off in accordance with the Policies and the Company
          Policies.  Prior to such date, such Seller shall be obligated to
          perform its servicing and other obligations hereunder and under
          the Related Documents with respect to Purchased Receivables
          previously sold by such Seller to the Company, including, without
          limitation, its obligation to deposit Collections into the
          appropriate Lockboxes.

                    (c)  A terminated Seller shall have no obligation to
          repurchase any Receivables other than Receivables previously sold
          by it to the Company which are subject to a Repurchase Event.

                    9.16  No Bankruptcy Petition.  Each Seller and C&A
          Products by entering into this Agreement, and any present or
          future holder of a Subordinated Note, by its acceptance thereof,
          covenants and agrees that, prior to the date which is one year
          and one day after the date of termination of this Agreement
          pursuant to subsection 9.17, it will not institute against, or
          join any other Person in instituting against, the Company any
          bankruptcy, reorganization, arrangement, insolvency or
          liquidation proceedings, or other proceedings under any federal
          or state bankruptcy or similar law.

                    9.17  Termination.  This Agreement will terminate at
          such time as (a) the commitment of the Company to purchase
          Receivables from all Sellers hereunder shall have terminated and
          (b) all Receivables purchased hereunder have been collected, and
          the proceeds thereof turned over to the Company and all other
          amounts owing to the Company hereunder shall have been paid in
          full or, if Receivables sold hereunder have not been collected
          such Receivables have become Defaulted Receivables and the
          Company shall have completed its collection efforts in respect
          thereto; provided, however, that the indemnities of the Sellers
          to the Company set forth in this Agreement shall survive such
          termination and provided, further, that, to the extent any
          amounts remain due and owing to the Company hereunder, the
          Company shall remain entitled to receive any collections on
          Receivables sold hereunder which have become Defaulted
          Receivables after it shall have completed its collection efforts
          in respect thereof.

                    9.18  Confidentiality.  The Company agrees that it
          shall maintain in confidence any information relating to any
          Seller furnished to it by or on behalf of such Seller (other than
          information that (x) has become generally available to the public
          other than as a result of 


<PAGE>

                                                                        32


          a disclosure by such party, (y) has been independently developed 
          by such party without violating this subsection 9.18 or (z) was 
          available to such party from a third party having, to such 
          party's knowledge, no obligation of confidentiality to such Seller) 
          and shall not reveal the same other than to its directors, officers, 
          employees and advisors with a need to know except:  (a) to the 
          extent necessary to comply with law or any legal process or the 
          requirements of any Governmental Authority or of any securities 
          exchange on which securities of the disclosing party or any 
          Affiliate of the disclosing party are listed or traded, (b) as 
          part of normal reporting or review procedures to Governmental 
          Authorities or its parent companies, Affiliates or auditors, (c) in 
          order to enforce its rights under any Sale Document in a legal 
          proceeding and (d) in connection with the collection of any 
          Purchased Receivable or the exercise of any remedy hereunder or 
          under the Receivables Transfer Agreement. 

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

                                      COLLINS & AIKMAN PRODUCTS CO., as Master
                                      Servicer

                                      By: 
                                         Title: 


                                      CARCORP, INC.

                                      By:
                                         Title: 


                                      The Sellers:


                                      COLLINS & AIKMAN PRODUCTS CO.

                                      By: 
                                         Title:



                                      ACK-TI-LINING, INC.

                                      By: 
                                         Title: 


<PAGE>

                                                                         33



                                      WCA CANADA, INC. 

                                      By: 
                                         Title: 


                                      IMPERIAL WALLCOVERINGS (CANADA), INC.

                                      By: 
                                         Title: 


                                      IMPERIAL WALLCOVERINGS, INC.

                                      By: 
                                         Title:


                                      THE AKRO CORPORATION

                                      By: 
                                         Title: 


                                      DURA ACQUISITION CORP.

                                      By: 
                                         Title:



<PAGE>


                                                                    ANNEX X

                    "ABR":  for any day, a rate per annum (rounded upwards,
               if necessary, to the next 1/16 of 1%) equal to the greatest
               of (a) the Prime Rate in effect on such day, (b) the Base CD
               Rate in effect on such day plus 1% and (c) the Federal Funds
               Effective Rate in effect on such day plus 1/2 of 1%.  For
               purposes hereof, "Prime Rate" shall mean the rate of
               interest per annum publicly announced from time to time by
               Chemical as its prime rate in effect at its principal office
               in New York City; each change in the Prime Rate shall be
               effective on the date such change is publicly announced as
               being effective.  "Base CD Rate" shall mean the sum of (a)
               the product of (i) the Three-Month Secondary CD Rate and
               (ii) Statutory Reserves and (b) the Assessment Rate. 
               "Three-Month Secondary CD Rate" shall mean, for any day, the
               secondary market rate for three-month certificates of
               deposit reported as being in effect on such day (or, if such
               day shall not be a Business Day, the next preceding Business
               Day) by the Board through the public information telephone
               line of the Federal Reserve Bank of New York (which rate
               will, under the current practices of the Board, be published
               in Federal Reserve Statistical Release H.15(519) during the
               week following such day), or, if such rate shall not be so
               reported on such day or such next preceding Business Day,
               the average of the secondary market quotations for
               three-month certificates of deposit of major money center
               banks in New York City received at approximately 10:00 a.m.,
               New York City time, on such day (or, if such day shall not
               be a Business Day, on the next preceding Business Day) by
               the Administrative Agent from three New York City negotiable
               certificate of deposit dealers of recognized standing
               selected by it.  "Federal Funds Effective Rate" shall mean,
               for any day, the weighted average of the rates on overnight
               Federal funds transactions with members of the Federal
               Reserve System arranged by Federal funds brokers, as
               published on the next succeeding Business Day by the Federal
               Reserve Bank of New York, or, if such rate is not so
               published for any day which is a Business Day, the average
               of the quotations for the day of such transactions received
               by the Administrative Agent from three Federal funds brokers
               of recognized standing selected by it.  If for any reason
               the Administrative Agent shall have determined (which
               determination shall be conclusive absent manifest error)
               that it is unable to ascertain the Base CD Rate or the
               Federal Funds Effective Rate or both for any reason,
               including the inability or failure of the Administrative
               Agent to obtain sufficient quotations in accordance with the
               terms thereof, the ABR shall be determined without regard to
               clause (b) or (c), or both, of the first sentence of this
               definition, as appropriate, until the circumstances giving
               rise to such inability no longer exist.  Any change in the
               ABR due to a change in the Prime Rate, the Base CD Rate or
               the Federal Funds Effective Rate shall be effective on the
               effective date of such change in the Prime Rate, the Base CD
               Rate or the Federal Funds Effective Rate, respectively.

                    "ABR Participating Interest":  with respect to any
               Bank, that portion of its Participating Interest in the
               Receivables with respect to which the Purchase Discount
               Amount is determined by reference to the ABR.


<PAGE>

                                                                         2



                    "Accounts":  as defined in subsection 2.1(c)(ii) of the
               Receivables Transfer Agreement.

                    "Acquiring Banks":  as defined in subsection 11.4(d) of
               the Receivables Transfer Agreement.

                    "Additional Seller Supplement":  an instrument
               substantially in the form of Exhibit C to the Receivables
               Sale Agreement by which a Subsidiary of C&A Products becomes
               a Seller party to the Receivables Sale Agreement.

                    "Additional Servicer Supplement":  an instrument
               substantially in the form of Exhibit F to the Receivables
               Transfer Agreement by which a Subsidiary of C&A Products
               becomes a Servicer party to the Receivables Transfer
               Agreement.

                    "Adjusted Principal Amount":  (a) in the case of any
               Receivable denominated in U.S. Dollars, the Principal Amount
               in respect thereof and (b) in the case of any Receivable
               denominated in Canadian Dollars, the Canadian Exchange
               Percentage of the Principal Amount in respect thereof.

                    "Adjustment":  as defined in subsection 2.5 of the
               Receivables Sale Agreement.

                    "Adjustment Payment":  as defined in subsection 12.4 of
               the Receivables Transfer Agreement.

                    "Administrative Agent":  Chemical, together with its
               affiliates, as the arranger of the Commitments and as the
               agent for the Banks under the Receivables Transfer
               Agreement.

                    "Affiliate":  as to any Person, any other Person that
               directly, or indirectly through one or more intermediaries,
               Controls or is Controlled by or is under common Control with
               the Person specified.

                    "Aggregate Eligible Receivables":  the excess of (a)
               the Applicable Eligible Receivables Percentage of the
               aggregate outstanding Adjusted Principal Amount of all
               Receivables over (b) the aggregate Excess Amounts with
               respect to all Obligors.


                    "Agreement":  the agreement wherein such term is used,
               as the same may from time to time be amended, supplemented
               or otherwise modified.

                    "Amortization Period":  the period commencing after the
               end of the Commitment Period and ending with the termination
               of the Receivables Transfer Agreement pursuant to subsection
               4.1 thereof.

                    "Applicable ABR Margin":  (a) prior to the 270th day
               after the Effective Date, 0% and (b) on and after such 270th
               day, the "Applicable Margin" with respect to "ABR Loans" (as
               each such term is defined in the Credit Agreement),
               determined in 



<PAGE>

                                                                          3



               accordance with the provisions of the Credit
               Agreement as in effect on the Effective Date.

                    "Applicable Eligible Receivables Percentage":  at any
               date of determination, a fraction (expressed as a
               percentage) equal to (a) the aggregate Adjusted Principal
               Amount of all Eligible Receivables determined pursuant to
               the most recent Settlement Statement divided by (b) the
               aggregate Adjusted Principal Amount of all outstanding
               Receivables generated by the Sellers determined pursuant to
               such Settlement Statement.

                    "Applicable Eurodollar Margin":  (a) prior to the 270th
               day after the Effective Date, 0.625% and (b) on and after
               such 270th day, the "Applicable Margin" with respect to
               "Eurodollar Loans" (as each such term is defined in the
               Credit Agreement), determined in accordance with the
               provisions of the Credit Agreement as in effect on the
               Effective Date.

                    "Applicable Obligor Percentage":  with respect to any
               Obligor, (a) 7.5%, in the case of any such Obligor having a
               long-term senior unsecured debt rating of at least A- from
               S&P or A3 from Moody's or a short-term deposit or commercial
               paper rating of at least A-1 from S&P or P-1 from Moody's,
               provided, that in the case of General Motors Corporation,
               Chrysler Corporation, Ford Motor Company and Honda Motor
               Co., the Applicable Obligor Percentage shall instead be
               17.0% so long as such Obligor maintains a short-term deposit
               or commercial paper rating of at least A-2 from S&P or P-2
               from Moody's; (b) 5.0%, in the case of any such Obligor (not
               described in clause (a) above) having a long-term senior
               unsecured debt rating of at least BBB- from S&P or Baa3 from
               Moody's or a short-term deposit or commercial paper rating
               of at least A-3 from S&P or P-3 from Moody's; or (c) 2.0%,
               in the case of any other such Obligor.

                    "Assessment Rate":  for any date, the annual rate
               (rounded upwards, if necessary, to the next 1/100 of 1%)
               most recently estimated by the Administrative Agent as the
               then current net annual assessment rate that will be
               employed in determining amounts payable by Chemical to the
               Federal Deposit Insurance Corporation (or any successor) for
               insurance by such Corporation (or such successor) of time
               deposits made in dollars at Chemical's domestic offices.

                    "Average Default Ratio":  for any Settlement Period, a
               percentage equal to (a) the sum of the Default Ratios for
               such Settlement Period and each of the two preceding
               Settlement Periods divided by (b) 3.

                    "Average Dilution Ratio":  with respect to any
               Settlement Period, a fraction (a) the numerator of which is
               the aggregate amount of Dilutive Credits which are incurred
               with respect to the Receivables during the twelve-month
               period ended on the last day of such Settlement Period and
               (b) the denominator of which is the aggregate Adjusted
               Principal Amount of Receivables generated by the Sellers
               during the twelve-month period ended on the last day of such
               Settlement Period.


<PAGE>

                                                                          4



                    "Bank":  each financial institution listed on Schedule
               1 to the Receivables Transfer Agreement and each financial
               institution to which an assignment has been made pursuant to
               the terms of the Receivables Transfer Agreement, and any
               successor of the foregoing.

                    "benefitted Bank":  as defined in subsection 11.12 of
               the Receivables Transfer Agreement.

                    "Board":  the Board of Governors of the Federal Reserve
               System and any successor thereto.

                    "Business Day":  any day (other than a day which is a
               Saturday, Sunday or legal holiday in the State of New York)
               on which banks are open for business in New York City;
               provided, however, that, when used in connection with any
               Fixed Tranche or the determination of any Eurodollar Rate,
               the term "Business Day" shall also exclude any day on which
               banks are not open for dealings in dollar deposits in the
               London interbank market.

                    "Business Day Received": as defined in subsection
               12.1(d) of the Receivables Transfer Agreement.

                    "C&A Products":  Collins & Aikman Products Co., a
               Delaware corporation.

                    "Canada/Canadian Dollar Concentration Account":  as
               defined in subsection 2.7(a) of the Receivables Transfer
               Agreement.

                    "Canada/U.S. Dollar Concentration Account":  as defined
               in subsection 2.7(a) of the Receivables Transfer Agreement.


                    "Canadian Dollars":  dollars in lawful currency of
               Canada.

                    "Canadian Dollar Subordinated Note":  as defined in
               subsection 8.1 of the Receivables Sale Agreement.

                    "Canadian Exchange Percentage":  at any date, the rate
               at which Canadian Dollars may be exchanged into Dollars
               (expressed as the percentage of Dollars per Canadian
               Dollar), determined by reference to the relevant Bloomberg
               currency page.  In the event that such rate does not appear
               on any Bloomberg currency page, the "Canadian Exchange
               Percentage" shall be determined by reference to such other
               publicly available service for displaying exchange rates
               with respect to Canadian Dollars as may be selected by the
               Administrative Agent.

                    "Capital Lease Obligations":  with respect to any
               Person, the obligations of such Person to pay rent or other
               amounts under any lease of (or other arrangement conveying
               the right to use) real or personal property, or a combina-
               tion thereof, which obligations are required to be classi-
               fied and accounted for as capital leases on a 


<PAGE>

                                                                         5


               balance sheet of such Person under GAAP and, for the purposes 
               hereof, the amount of such obligations at any time shall be 
               the capitalized amount thereof at such time determined in 
               accordance with GAAP.

                    "Capital Stock":  any and all shares, interests,
               participations or other equivalents (however designated) of
               capital stock of a corporation, any and all equivalent
               ownership interests in a Person (other than a corporation)
               and any and all warrants, options or other rights to
               purchase or acquire any of the foregoing.

                    "Cash Equivalents":  book-entry securities, negotiable
               instruments or securities represented by instruments in
               bearer or registered form which evidence:

                    (a)  direct obligations of, and obligations fully
               guaranteed as to timely payment by, the United States of
               America;

                    (b)  demand deposits, time deposits or certificates of
               deposit of any depository institution or trust company
               incorporated under the laws of the United States of America
               or any state thereof (or any domestic branch of a foreign
               bank) and subject to supervision and examination by Federal
               or State banking or depository institution authorities;
               provided, that at the time of the investment or contractual
               commitment to invest therein the commercial paper or other
               short-term unsecured debt obligations (other than such
               obligations the rating of which is based on the credit of a
               Person other than such depository institution or trust
               company) thereof shall have a credit rating from each of the
               Rating Agencies in the highest investment category granted
               thereby;

                    (c)  commercial paper having, at the time of the
               investment or contractual commitment to invest therein, a
               rating of A-1 from S&P or of P-1 from Moody's;

                    (d)  investments in money market funds having a rating
               from each of the Rating Agencies in the highest investment
               category granted thereby;

                    (e)  demand deposits, time deposits and certificates of
               deposit which are fully insured by the Federal Deposit
               Insurance Corporation;

                    (f)  bankers' acceptances issued by any depository
               institution or trust company referred to in clause (b)
               above;

                    (g)  repurchase obligations with respect to any
               security that is a direct obligation of, or fully guaranteed
               by, the United States of America or any agency or
               instrumentality thereof the obligations of which are backed
               by the full faith and credit of the United States of
               America, in either case entered into with (i) a depository
               institution or trust company (acting as principal) described
               in clause (b) above or (ii) so long as the Company takes
               actual or constructive possession of each security subject
               to such repurchase obligations, a depository institution or
               trust company the deposits of which are insured by the
               Federal Deposit Insurance Corporation; or


<PAGE>

                                                                         6



                    (h)  any other investment permitted by Moody's and S&P
               for short-term investment of funds supporting securities
               with a rating of A1/P1 or better.

                    "Change in Control":  (a) any "Change in Control"
               under the Credit Agreement (as such term is defined
               therein on the Effective Date), (b) except upon the
               exercise by the Collateral Agent of any of its remedies
               in accordance with the terms of the Pledge Agreement
               (as in effect on the Effective Date), the Company shall
               at any time not be a direct wholly owned Subsidiary of
               C&A Products or (c) except as permitted pursuant to
               subsection 9.15 of the Receivables Sale Agreement and
               subsection 12.10 of the Receivables Transfer Agreement,
               any Seller or Servicer (other than C&A Products) shall
               at any time not be wholly owned, either directly or
               indirectly, by C&A Products.

                    "Charge-Offs":  with respect to the Receivables
               originated by any Seller, for any period, the aggregate
               amount of such Receivables that are written off, or should
               be written off, during such period as uncollectible in
               accordance with the Company Policies.

                    "Chemical":  Chemical Bank, a New York banking
               corporation.

                    "Closing Date":  as defined in subsection 2.3(a) of the
               Receivables Transfer Agreement.

                    "Code":  the Internal Revenue Code of 1986, as amended
               from time to time.

                    "Collateral Agent":  as defined in the Credit
               Agreement.

                    "Collections":  all cash collections and other cash
               proceeds received in respect of Receivables and Related
               Property including, without limitation, Seller Repurchase
               Payments and Seller Adjustment Payments and any Investment
               Earnings.

                    "Commitment":  of each Bank, the amount set forth
               opposite the name of such Bank on Schedule 1 to the
               Receivables Transfer Agreement, as such amount may be
               changed pursuant to subsection 2.10 or 11.4 of the
               Receivables Transfer Agreement.

                    "Commitment Fee":  as defined in subsection 2.4 of the
               Receivables Transfer Agreement.

                    "Commitment Percentage":  as to any Bank, (a) on or
               prior to the termination of the Commitments, the percentage
               equivalent of a fraction the numerator of which is the
               Commitment of such Bank and the denominator of which is the
               Maximum Commitment and (b) thereafter, the percentage
               equivalent of a fraction the numerator of which is the
               Commitment of such Bank immediately prior to such
               termination and the denominator of which is the Maximum
               Commitment immediately prior to such termination.



<PAGE>

                                                                         7



                    "Commitment Period":  the period from and including the
               Effective Date, up to but not including the first to occur
               of (a) the Scheduled Termination Date, (b) any termination
               of the Commitments pursuant to Article IX of the Receivables
               Transfer Agreement and (c) termination (but not reduction)
               of the Commitments pursuant to subsection 2.10 of the
               Receivables Transfer Agreement.

                    "Company":  Carcorp, Inc., a Delaware corporation.

                    "Company Policies":  the written policies of the
               Company with respect to Charge-Offs and Write-Offs of
               Receivables.


                    "Complete Servicing Transfer":  as defined in
               subsection 12.2(d) of the Receivables Transfer Agreement.

                    "Concentration Accounts":  the collective reference to
               the U.S. Concentration Account, the Canada/U.S. Dollar
               Concentration Account and the Canada/Canadian Dollar
               Concentration Account.

                    "Contractual Obligation":  as to any Person, any
               provision of any security issued by such Person or of any
               agreement, instrument or other undertaking to which such
               Person is a party or by which it or any of its property is
               bound.

                    "Control":  the possession, directly or indirectly, of
               the power to direct or cause the direction of the management
               or policies of a Person, whether through the ownership of
               voting securities, by contract or otherwise, and
               "Controlling" and "Controlled" shall have meanings
               correlative thereto.

                    "Credit Agreement":  the Credit Agreement dated as of
               June 22, 1994 among the Credit Agreement Borrower, WCA
               Canada, Inc., as Canadian Borrower, Collins & Aikman
               Corporation, as Guarantor, the Lenders named therein,
               Continental Bank, N.A. and NationsBank, N.A., as Managing
               Agents, and Chemical Bank, as Administrative Agent, as
               amended, supplemented or otherwise modified from time to
               time.

                    "Credit Agreement Borrower":  C&A Products Co. 

                    "Daily Report":  as defined in subsection 12.5(a) of
               the Receivables Transfer Agreement.

                    "Days Sales Outstanding":  as of any day, the product
               of (a) 91 and (b) the amount obtained by dividing (i) the
               difference between (x) the aggregate Adjusted Principal
               Amount of the Receivables and (y) the aggregate bad debt
               reserve of the Sellers, in each case as at the end of the
               fiscal month immediately preceding the most recent
               Settlement Date, by (ii) aggregate net sales of the Sellers
               for the three-fiscal-month period immediately preceding the
               most recent Settlement Date.



<PAGE>

                                                                         8



                    "Defaulted Receivable":  any Receivable which has been
               charged off, or should have been charged off, by the related
               Servicer as uncollectible in accordance with the Policies of
               such Servicer and the Company Policies.

                    "Default Ratio": (a) with respect to any Settlement
               Period ending on or before April 30, 1994, a fraction (i)
               the numerator of which is the aggregate Adjusted Principal
               Amount of Receivables which first became 60 to 89 days past
               due as of the last day of such month and (ii) the
               denominator of which is the aggregate Adjusted Principal
               Amount of Receivables generated by the Sellers during the
               fourth preceding Settlement Period and (b) with respect to
               any Settlement Period ending on any date thereafter, a
               fraction (i) the numerator of which is the aggregate
               Adjusted Principal Amount of Receivables which first became
               90 to 119 days past due as of the last day of such month and
               (ii) the denominator of which is the aggregate Adjusted
               Principal Amount of Receivables generated by the Sellers
               during the fifth preceding Settlement Period.

                    "Dilution Reserve Ratio":  as of any day, the
               percentage equivalent, determined pursuant to the most
               recent Settlement Statement, of the product of (x) the sum
               of clauses (i) and (ii) below and (y) clause (iii) below:

                    (i) (A) 2.0 times (B) the Average Dilution Ratio for
               the most recently ended Settlement Period;

                    (ii) the product of (A)(x) the highest Peak Dilution
               Ratio during the period of 12 fiscal months ended on the
               last day of the most recently ended Settlement Period minus
               (y) the amount determined pursuant to clause (i)(B) of this
               definition and (B) the amount determined pursuant to clause
               (A)(x) above divided by the amount determined pursuant to
               clause (A)(y) above; and

                    (iii) (A) the aggregate Adjusted Principal Amount of
               Receivables generated by the Sellers during the most
               recently ended Settlement Period divided by (B) the
               aggregate Adjusted Principal Amount of Eligible Receivables
               on the last day of such Settlement Period.

                    "Dilutive Credits":  for any period, the aggregate
               amount of discount expense, rebates, refunds, billing error
               expense, credits against Receivables and other adjustments
               or allowances in respect of Receivables permitted or
               incurred by the Seller or Servicer with respect thereto
               during such period.

                    "Discount Rate":  as of any day, the sum of (a) the
               weighted average Purchase Discount Amount rate in effect
               with respect to the Participating Interest as at the end of
               the fiscal month immediately preceding the most recent
               Settlement Date and (b) the amount obtained by dividing (i)
               the aggregate amount of fees (other than the Monthly
               Servicing Fee and the Purchase Discount Amount) accrued with
               respect to the Participating Interest during the fiscal
               month immediately preceding the most recent Settlement Date
               by (ii) the average daily Net Investment during such fiscal 
               month.

<PAGE>

                                                                         9


                    "Discounted Percentage":  as defined in Schedule 3 to
               the Receivables Sale Agreement.

                    "Documents":  as defined in subsection 5.15(d)(3) of
               the Receivables Sale Agreement.

                    "Dollars", "U.S. Dollars" and "$":  dollars in lawful
               currency of the United States of America.

                    "Early Termination":  as defined in Article VII of the
               Receivables Sale Agreement.

                    "Effective Date":  as defined in subsection 6.1 of the
               Receivables Transfer Agreement.

                    "Eligible Letter of Credit":  any irrevocable direct
               pay or standby letter of credit (a) issued in favor of the
               Company by (i) any Bank or (ii) any commercial bank that (x)
               has combined capital and surplus of not less than
               $500,000,000 and (y) has (or the holding company parent of
               which has) a long-term senior unsecured debt rating of at
               least A from S&P or at least A2 from Moody's and (b) which
               permits the Company to draw, upon notice to the issuing
               bank, an amount equal to the entire face amount of any
               Receivable supported thereby, in Dollars payable by the
               issuing bank in the United States, no later than 90 days
               after the original invoice date with respect to such
               Receivable.

                    "Eligible Obligor":  each Obligor that satisfies each
               of the following eligibility criteria:

                         (a)  it is not organized or located (within the
                    meaning of Section 9-103(3)(d) of the New York Uniform
                    Commercial Code) in a jurisdiction other than the
                    United States; provided, however, that (i) Receivables
                    which have Obligors organized or located in Canada or
                    which are Japanese Obligors or (ii) Receivables which
                    have Obligors not otherwise described in clause (i)
                    above which are located (within the meaning of Section
                    9-103(3)(d) of the New York Uniform Commercial Code)
                    outside the United States shall be excluded from this
                    clause (a) if (x) in the case of clauses (i) and (ii)
                    above, such Receivables would otherwise be Eligible
                    Receivables and (y) in the case of clause (ii) above,
                    (1) such Receivables are supported by an Eligible
                    Letter of Credit and (2) the aggregate Adjusted
                    Principal Amount of all such Receivables does not
                    exceed 15% of the Adjusted Principal Amount of the
                    Eligible Receivables; 

                         (b)  it is not a direct or indirect Subsidiary of
                    Holdings; 

                         (c)  it is not a domestic or foreign government or
                    any agency, department, or instrumentality thereof;
                    provided, however, that up to 3% of the aggregate
                    Adjusted Principal Amount of the Eligible Receivables
                    may be 


<PAGE>

                                                                          10



                    owing by the United States government or any
                    agency, department or instrumentality thereof; and
           
                         (d)  it is not the subject of any reorganization,
                    bankruptcy, receivership, custodianship or insolvency,
                    unless the payment of Receivables from such Obligor is
                    secured in a manner satisfactory to the Administrative
                    Agent or, if such Receivables arise subsequent to a
                    decree or order for relief under the Bankruptcy Reform
                    Act of 1978, as amended, with respect to such Obligor,
                    the Administrative Agent shall have determined that
                    timely payment and collection of such Receivables will
                    not be impaired.

                    "Eligible Receivable":  as of any date, each Receivable
               in existence as of such date that is not subject to a
               Repurchase Event and (i) which the Administrative Agent
               determines, in its commercially reasonable judgment, to be
               an "Eligible Receivable" or (ii) that satisfies each of the
               following eligibility criteria:

                         (a)  the Company has lawful title to such
                    Receivable, free and clear of all Liens other than the
                    security interest in favor of the Banks;

                         (b)  the Banks have a Lien on such Receivable,
                    which Lien is legal, valid, binding, perfected and
                    first priority under the Uniform Commercial Code or
                    other applicable law;

                         (c)  the Company has the full and unqualified
                    right to assign and grant a Lien on such Receivable to
                    the Banks;

                         (d)  such Receivable is payable in Dollars in the
                    United States or Canada and is a legal, valid, binding
                    and enforceable obligation of the Obligor under such
                    Receivable; provided, however, that Receivables having
                    an aggregate Adjusted Principal Amount equal to no more
                    than 10% of the aggregate Adjusted Principal Amount of
                    all Eligible Receivables may be payable in Canadian
                    dollars in the United States or Canada;

                         (e)  such Receivable is not subject to any bona
                    fide dispute, setoff, counterclaim or other claim or
                    defense on the part of the related Obligor denying
                    liability under such Receivable in whole or in part;
                    provided, however, that any such Receivable shall
                    constitute an Eligible Receivable to the extent it is
                    not subject to any such dispute, setoff, counterclaim
                    or other claim or defense;

                         (f)  such Receivable is evidenced by an invoice
                    rendered to the related Obligor and is not evidenced by
                    any "instrument" or "chattel paper", as such terms are
                    defined in the Uniform Commercial Code;

                         (g)  such Receivable is a bona fide Receivable
                    which arose in the ordinary course of business, and
                    with respect to which,


<PAGE>

                                                                       11



                              (i)  in the case of a Receivable arising from
                         the sale of goods, such goods have been shipped or
                         delivered to and accepted by the Obligor, such
                         Receivable was created as a result of a sale on an
                         absolute basis and not on a consignment, approval
                         or sale-and-return basis and all other actions
                         have been taken necessary to create a binding
                         obligation on the part of the Obligor for such
                         Receivable, and

                              (ii)  in the case of a Receivable relating to
                         the sale of services, such services have been
                         performed or completed and accepted by the Obligor
                         and all other actions have been taken necessary to
                         create a binding obligation on the part of the
                         Obligor;

                         (h)  the Obligor with respect to such Receivable
                    is an Eligible Obligor; 

                         (i)  such Receivable is not outstanding more than
                    90 days past the original invoice date with respect
                    thereto (which date, for all purposes of eligibility,
                    shall not be later than the shipment date of the goods
                    giving rise to such Receivable); provided, however,
                    that Receivables of Imperial Wallcoverings, Inc. and
                    Imperial Wallcoverings (Canada), Inc. (not to exceed an
                    aggregate Adjusted Principal Amount of $12,500,000) may
                    be outstanding for up to, but not in excess of, 120
                    days past such original invoice date; 

                         (j)  payment with respect to such Receivable, if
                    by check, has not been returned for insufficient funds;

                         (k)  such Receivable has not been placed with an
                    attorney for collection;

                         (l)  such Receivable, to the extent it represents
                    a consumer credit card receivable, conforms to all
                    federal and state consumer protection laws;

                         (m)  if such Receivable represents a consumer
                    credit card receivable, the outstanding balance of such
                    Receivable does not reflect more than two arrearages;
                    and


                         (n)  such Receivable has such other
                    characteristics or criteria as the Administrative
                    Agent, in its reasonable discretion, may specify in
                    writing to the Company.

                    "Equipment":  as defined in subsection 2.1(c)(i) of the
               Receivables Transfer Agreement.

                    "ERISA":  the Employee Retirement Income Security Act
               of 1974, as the same may be amended from time to time.


<PAGE>

                                                                         12



                    "ERISA Affiliate":  with respect to any Person, any
               trade or business (whether or not incorporated) that is a
               member of a group of which such Person is a member and which
               is treated as a single employer under Section 414 of the
               Code.

                    "Eurodollar Participating Interest":  with respect to
               any Bank, that portion of its Participating Interest in the
               Receivables with respect to which the Purchase Discount
               Amount is determined by reference to the Eurodollar Rate.

                    "Eurodollar Rate":  with respect to each day during
               each Transfer Period pertaining to a Fixed Tranche, a rate
               per annum (rounded upwards, if necessary, to the next 1/16
               of 1%) equal to the product of (a) the Eurodollar Base Rate
               in effect for such Transfer Period and (b) Statutory
               Reserves.  For purposes hereof, (a) if at least two offered
               rates for deposits in dollars for a period comparable to the
               applicable Transfer Period appear on page 3750 (or any
               successor page) of the Dow Jones Telerate Screen as of 11:00
               a.m., London time, on the day that is two Business Days
               prior to the first day of such Transfer Period, the term
               "Eurodollar Base Rate" shall mean the arithmetic mean of all
               such offered rates and (b) if fewer than two such offered
               rates so appear on page 3750 (or any successor page) of the
               Dow Jones Telerate Screen, the term "Eurodollar Base Rate"
               shall mean the rate (rounded upwards, if necessary, to the
               next 1/16 of 1%) at which dollar deposits approximately
               equal in principal amount to Chemical's portion of the
               applicable Fixed Tranche and for a period comparable to the
               applicable Transfer Period are offered to Chemical's office
               in which its relevant eurodollar operations are being
               conducted in immediately available funds in the eurodollar
               market at approximately 11:00 a.m., New York time, on the
               day that is two Business Days prior to the first day of such
               Transfer Period.

                    "Excess Amount":  at any time, with respect to any
               Obligor, the excess (if any) of (a) the aggregate
               outstanding Adjusted Principal Amount of the Eligible
               Receivables owing by such Obligor over (b) the Applicable
               Obligor Percentage of the aggregate outstanding Adjusted
               Principal Amount of all Eligible Receivables; provided, that
               the Excess Amount of each Obligor shall be deemed to be zero
               until the first Settlement Date subsequent to the 270th day
               after the Effective Date.

                    "Excess Application Amount":  as defined in subsection
               2.12(c) of the Receivables Transfer Agreement.

                    "Facility Amount":  $150,000,000.

                    "Financial Officer":  of any corporation, the chief
               financial officer, Senior Vice President-Finance and
               Accounting, Vice President-Finance, Controller, or Treasurer
               of such corporation. 

                    "Fixed Tranche":  a portion of the Net Investment on
               which the rate at which the Purchase Discount Amount accrues
               is based upon the Eurodollar Rate.



<PAGE>

                                                                        13



                    "Floating Tranche":  that portion of the Net Investment
               not allocated to a Fixed Tranche and the Purchase Discount
               Amount in respect of which is based upon the ABR.

                    "Force Majeure Delay":  with respect to any Servicer or
               the Master Servicer, any cause or event which is beyond the
               control and not due to the negligence of such Servicer or
               the Master Servicer, as the case may be, which delays,
               prevents or prohibits such Person's delivery of Seller Daily
               Reports or Daily Reports and/or Seller Settlement Statements
               or Settlement Statements, as the case may be, including,
               without limitation, computer, electrical and mechanical
               failures, acts of God or the elements and fire; provided
               that no such cause or event shall be deemed to be a Force
               Majeure Delay unless the affected Servicer or Master
               Servicer shall have given the Company and the Administrative
               Agent written notice thereof as soon as possible after the
               beginning of such delay.

                    "GAAP":  generally accepted accounting principles in
               the United States of America as in effect from time to time.

                    "Governmental Authority":  any international, Federal,
               state, regional, local or foreign court or governmental
               agency, authority, instrumentality or regulatory body.

                    "Guarantee":  of or by any Person, shall mean (a) any
               obligation, contingent or otherwise, of such Person guaran-
               teeing or having the economic effect of guaranteeing any
               Indebtedness of any other Person (the "primary obligor") in
               any manner, whether directly or indirectly, and including
               any obligation of such Person, direct or indirect, (i) to
               purchase or pay (or advance or supply funds for the purchase
               or payment of) such Indebtedness (whether arising by virtue
               of partnership arrangements, by agreement to keep well, to
               purchase assets, goods, securities or services, to take-
               or-pay or otherwise) or to purchase (or to advance or supply
               funds for the purchase of) any security for the payment of
               such Indebtedness, (ii) to purchase property, securities or
               services for the purpose of assuring the owner of such
               Indebtedness of the payment of such Indebtedness, (iii) to
               maintain working capital, equity capital or other financial
               statement conditions or liquidity of the primary obligor so
               as to enable the primary obligor to pay such Indebtedness or
               (iv) entered into for the purpose of assuring in any other
               manner the holders of such Indebtedness of the payment
               thereof or to protect such holders against loss in respect
               thereof (in whole or in part), or (b) any Lien on any assets
               of such Person securing any Indebtedness of any other
               Person, whether or not such Indebtedness is assumed by such
               Person; provided, however, that the term Guarantee shall not
               include endorsements for collection or deposit, in either
               case in the ordinary course of business.

                    "Holdings":  Collins & Aikman Corporation, a Delaware
               corporation.

                    "Incipient Purchase Termination Event":  any condition
               or act specified in Article VII of the Receivables Sale
               Agreement that, with the giving of notice or the lapse of
               time or both, would become a Purchase Termination Event.


<PAGE>

                                                                        14




                    "Increase in Net Investment":  for any applicable
               Closing Date, the Dollar amount by which the Net Investment
               of the Banks is being increased on such Closing Date.

                    "Indebtedness":  of any Person at any date, (a) all
               indebtedness of such Person for borrowed money or for the
               deferred purchase price of property or services (other than
               current trade liabilities incurred in the ordinary course of
               business and payable in accordance with customary
               practices), (b) any other indebtedness of such Person which
               is evidenced by a note, bond, debenture or similar
               instrument, (c) all Capital Lease Obligations of such
               Person, (d) all obligations of such Person in respect of
               acceptances issued or created for the account of such
               Person, (e) all Indebtedness of others secured by (or for
               which the holder of such Indebtedness has an existing right,
               contingent or otherwise, to be secured by) any Lien on any
               property owned or acquired by such Person even though such
               Person has not assumed or otherwise become liable for the
               payment thereof, (f) all obligations of such Person in
               respect of interest rate protection agreements, foreign
               currency exchange agreements or other interest or exchange
               rate hedging arrangements and (g) all Guarantees by such
               Person of Indebtedness of others.  The Indebtedness of any
               Person shall include the Indebtedness of any partnership in
               which such Person is a general partner; provided that, if
               the sole asset of such Person is its general partnership
               interest in such partnership, the amount of such
               Indebtedness shall be deemed equal to the value of such
               general partnership interest and the amount of any
               Indebtedness in respect of any Guarantee of such partnership
               Indebtedness shall be limited to the same extent as such
               Guarantee may be limited.

                    "Indemnified Liabilities":  as defined in subsection
               9.3 of the Receivables Sale Agreement.

                    "Indemnitee":  as defined in subsection 11.3 of the
               Receivables Transfer Agreement.

                    "Intermediate Lockbox Account":  as defined in
               subsection 12.1(b) of the Receivables Transfer Agreement.

                    "Invested Percentage":  a fraction the numerator of
               which is Net Investment and the denominator of which is
               Aggregate Eligible Receivables.

                    "Investment Earnings":  as defined in subsection
               2.7(a)(iii) of the Receivables Transfer Agreement.

                    "Japanese Obligor":  any of Fuji Heavy Industries,
               Inc., Toyota Motor Co., Honda Motor Co., Ltd., Toyota Tsusho
               Corp., or Kotobakiya Fronte Co., Inc.

                    "Lien":  with respect to any asset, (a) any mortgage,
               deed of trust, lien, pledge, encumbrance, charge or security
               interest in or on such asset, (b) the interest of a vendor
               or a lessor under any conditional sale agreement, capital
               lease or title retention 


<PAGE>

                                                                        15


               agreement relating to such asset and (c) in the case of 
               securities, any purchase option, call or similar right of a 
               third party with respect to such securities.

                    "Lockbox Account" means each blocked deposit account
               identified by number and name of bank on Schedule 3 to the
               Receivables Transfer Agreement, including the box identified
               by location and number on such Schedule 3, and any
               replacements therefor or additions thereto which are
               acceptable to the Administrative Agent.

                    "Lockbox Agreement" means a lockbox agreement in form
               and substance satisfactory to the Administrative Agent, as
               the same may be amended, supplemented or otherwise modified
               from time to time in accordance with subsection 8.14 of the
               Receivables Transfer Agreement.

                    "Lockbox Bank" means each bank listed on Schedule 3,
               and any replacements therefor or additions thereto agreed to
               in writing by the Administrative Agent.

                    "Loss Reserve Ratio":  as of any day thereafter, the
               percentage equivalent, determined pursuant to the most
               recent Settlement Statement, of the product of:

                    (i) the highest Average Default Ratio during the period
               of twelve consecutive fiscal months ended on the last day of
               the most recently ended Settlement Period; and

                    (ii) (A) the aggregate Adjusted Principal Amount of
               Receivables generated by the Sellers during the 3.5
               preceding Settlement Periods divided by the outstanding
               Adjusted Principal Amount of Eligible Receivables as of the
               last day of the preceding Settlement Period; and

                    (iii) 2.0.

                    "Loss to Liquidation Ratio":  a ratio (expressed as a
               percentage), as of the last day of any fiscal month, equal
               to (a) the difference, if any, between (i) the aggregate
               reduction in the outstanding Adjusted Principal Amount of
               all Receivables as a result of Write-Offs during the
               immediately preceding twelve-fiscal-month period and (ii)
               the aggregate amount of Recoveries during such twelve-
               fiscal-month period, divided by (b) four times the aggregate
               amount of Collections during the immediately preceding
               three-fiscal-month period.

                    "Margin Stock":  as defined in Regulation U.

                    "Master Servicer":  C&A Products, in its capacity as
               Master Servicer under the Receivables Transfer Agreement.

                    "Material Adverse Effect":  (a) with respect to the
               Master Servicer, any Servicer or any Seller, (i) a materi-
               ally adverse effect on the business, assets, properties,
               operations or financial condition of C&A Products and its
               Subsidiaries, taken as a whole, (ii) a material impairment
               of the ability of the Master Servicer, any 


<PAGE>

                                                                    16


               Servicer or any Seller to perform any of its material 
               obligations under any Transaction Document to which it is or 
               will be a party or to consummate the Transactions or the Sale 
               Transactions or (iii) an impairment of the validity or 
               enforceability of, or a material impairment of the rights, 
               remedies or benefits available to the Administrative Agent or 
               the Banks under, any Transaction Document or (b) with respect 
               to the Company, (i) a materially adverse effect on the 
               business, assets, properties, operations or financial condition 
               of the Company, (ii) a material impairment of the ability of the
               Company to perform any of its material obligations under any
               Transaction Document to which it is or will be a party or to
               consummate the Transactions or the Sale Transactions or
               (iii) an impairment of the validity or enforceability of, or
               a material impairment of the rights, remedies or benefits
               available to the Administrative Agent or the Banks under,
               any Transaction Document.  

                    "Maximum Commitment":  $150,000,000, as such amount may
               be reduced pursuant to subsection 2.10 of the Receivables
               Transfer Agreement.

                    "Maximum Invested Percentage":  at a particular date,
               100% minus the greater of (a) 17% and (b) the Required
               Reserve Percentage.

                    "Maximum Transfer Amount":  at a particular date, the
               lesser of (a) the Maximum Commitment at such date and (b)
               the product of (i) the Maximum Invested Percentage at such
               date and (ii) Aggregate Eligible Receivables (which, for
               purposes of this definition, shall not include a Seller from
               which the Company has ceased purchasing Receivables pursuant
               to subsection 9.15 of the Receivables Sale Agreement and
               shall not include, from the date which is 30 days after the
               date of any such termination, a Seller with respect to which
               the Company has terminated its obligation to acquire
               Receivables pursuant to Article VII of the Receivables Sale
               Agreement) as of the close of business on the Business Day
               preceding such date.

                    "Monthly Servicing Fee":  for each Settlement Period,
               the product of (a) the number of days in such period, (b) 1%
               and (c) the average daily principal balance of Purchased
               Receivables during such period divided by 365.

                    "Moody's":  Moody's Investors Service, Inc. and its
               successors.

                    "Multiemployer Plan":  with respect to any Person, a
               multiemployer plan as defined in Section 4001(a)(3) of ERISA
               to which such Person or any ERISA Affiliate of such Person
               (other than one considered an ERISA Affiliate only pursuant
               to subsection (m) or (o) of Section 414 of the Code) is
               making or accruing an obligation to make contributions, or
               has within any of the preceding five plan years made or
               accrued an obligation to make contributions.

                    "Net Investment":  at any time, the excess, if any, of
               (a) the aggregate of the amount paid by the Banks pursuant
               to subsections 2.2 and 2.3 of the Receivables Transfer
               Agreement over (b) the aggregate amount of Collections
               distributed to the 



<PAGE>

                                                                          17



               Banks in repayment of the Net Investment
               pursuant to the Receivables Transfer Agreement.

                    "Obligor":  with respect to any Receivable, the Person
               or Persons obligated to make payments with respect to such
               Receivable, including any guarantor thereof.


                    "Overallotment Option":  as defined in the Credit
               Agreement.

                    "Partial Servicing Transfer":  as defined in subsection
               12.2(d) of the Receivables Transfer Agreement.

                    "Participants":  as defined in subsection 11.4(b) of
               the Receivables Transfer Agreement.

                    "Participating Interest":  as defined in subsection 2.2
               of the Receivables Transfer Agreement.

                    "Payment Date":  as defined in subsection 2.3(a) of the
               Receivables Sale Agreement.

                    "PBGC":  the Pension Benefit Guaranty Corporation
               referred to and defined in ERISA (or any successor).

                    "Peak Dilution Ratio":  with respect to any Settlement
               Period, a fraction (a) the numerator of which is the
               aggregate amount of Dilutive Credits which are incurred with
               respect to the Receivables during the two-month period ended
               on the last day of such Settlement Period and (b) the
               denominator of which is the aggregate Adjusted Principal
               Amount of Receivables generated by the Sellers during the
               two-month period ended on the last day of such Settlement
               Period.

                    "Person":  any natural person, corporation, business
               trust, joint venture, association, company, partnership or
               government, or any agency or political subdivision thereof.

                    "Plan":  with respect to any Person, any pension plan
               (other than a Multiemployer Plan) subject to the provisions
               of Title IV of ERISA or Section 412 of the Code which is
               maintained for employees of such Person or any ERISA
               Affiliate of such Person.

                    "Pledge Agreement":  the Pledge Agreement referred to
               in the Credit Agreement.

                    "Policies":  with respect to any Seller which has set
               forth its credit and collection policies in writing, such
               written credit and collection policies as they have been
               applied by such Seller in the ordinary course of its
               business prior to the Effective Date and, with respect to
               any Seller which has not set forth its credit and collection


<PAGE>

                                                                          18


               policies in writing, its credit and collection policies as
               in effect and applied by such Seller in the ordinary course
               of its business prior to the Effective Date, in each case as
               the same may be amended, supplemented or otherwise modified
               from time to time in accordance with the Receivables
               Transfer Agreement and the Receivables Sale Agreement.


                    "Pooled Property":  as defined in subsection 2.1(a) of
               the Receivables Transfer Agreement.

                    "Potential Termination Event":  any Termination Event
               and any event or condition that upon notice, lapse of time
               or both would constitute a Termination Event.

                    "Preliminary Prospectus":  the preliminary prospectus
               of Holdings dated June 2, 1994, filed with the Securities
               and Exchange Commission in connection with the underwritten
               public offering of shares of common stock, par value $.01
               per share, of Holdings, as amended or supplemented from time
               to time.

                    "Principal Amount":  with respect to any Receivable,
               the amount due thereunder (expressed in U.S. Dollars or
               Canadian Dollars, as the case may be), net of any available
               prompt payment discount, volume discount or other
               promotional discount or rebate.

                    "Purchase Discount Amount":  a purchase discount which
               (a) accrues to the Banks in respect of the Participating
               Interest; (b) is payable in arrears on each Purchase
               Discount Amount Payment Date (both prior to and after the
               commencement of the Amortization Period) occurring during
               the period commencing on the date of the first transfer and
               assignment of the Participating Interest in Receivables and
               Related Property pursuant to subsection 2.3(a) of the
               Receivables Transfer Agreement and ending on the date on
               which the Net Investment is equal to zero and the
               Commitments of the Banks have terminated; and (c) is
               calculated at a rate per annum equal to:  (i) in respect of
               that portion of the Net Investment allocated to any Fixed
               Tranche, the sum of the Eurodollar Rate with respect thereto
               plus the Applicable Eurodollar Margin and (ii) in respect of
               that portion of the Net Investment not allocated to any
               Fixed Tranche, the sum of the ABR in effect from time to
               time during the period for which payment is made plus the
               Applicable ABR Margin.

                    "Purchase Discount Amount Payment Date":  (a) as to the
               Floating Tranche, each Settlement Date, (b) as to any Fixed
               Tranche having a Transfer Period of one, two or three
               months, the last day of such Transfer Period, (c) as to any
               Fixed Tranche having a Transfer Period longer than three
               months, each day which is three months, or a whole multiple
               thereof, after the first day of such Transfer Period, and
               the last day of such Transfer Period and (d) as to any
               Tranche, any date on which the principal portion of the Net
               Investment represented thereby is paid, prepaid or is
               otherwise due (by mandatory prepayment, acceleration or
               otherwise).


<PAGE>

                                                                        19


                    "Purchase Price":  as defined in subsection 2.2 of the
               Receivables Sale Agreement.

                    "Purchase Termination Event":  as defined in Article
               VII of the Receivables Sale Agreement.

                    "Purchased Receivable":  any Receivable sold to the
               Company by any Seller pursuant to, and in accordance with
               the terms of, the Receivables Sale Agreement and not resold
               to such Seller pursuant to subsection 2.1(b) or 2.6 thereof.

                    "Rating Agencies":  Moody's and S&P.

                    "Recapitalization Transactions":  as defined in the
               Credit Agreement.

                    "Receivables":  the indebtedness and payment
               obligations of any Person to a Seller arising from a sale of
               merchandise or services by such Seller, including, without
               limitation, any right to payment for goods sold or leased or
               for services rendered, and including the right of payment of
               any interest, sales taxes, finance charges, returned check
               or late charges and other obligations of such Person with
               respect thereto.

                    "Receivables Sale Agreement":  the Receivables Sale
               Agreement, dated as of July 13, 1994, among the Sellers, the
               Master Servicer and the Company, as buyer, as amended,
               supplemented or otherwise modified from time to time.

                    "Receivables Transfer Agreement":  the Receivables
               Transfer and Servicing Agreement, dated as of July 13, 1994,
               among the Company, as seller, the Master Servicer, the
               Servicers, the Banks and the Administrative Agent, as
               amended, supplemented or otherwise modified from time to
               time.

                    "Recoveries":  amounts collected in respect of
               Defaulted Receivables.

                    "Reduction Date":  as defined in subsection 2.11(b) of
               the Receivables Transfer Agreement.

                    "Register":  as defined in subsection 11.4(e) of the
               Receivables Transfer Agreement.

                    "Regulation G, T, U or X":  Regulation G, T, U or X,
               respectively, of the Board as from time to time in effect
               and all official rulings and interpretations thereunder or
               thereof.

                    "Related Property":  as defined in subsection
               2.1(a)(iv) of the Receivables Transfer Agreement.


                    "Replacement Facility":  as defined in subsection 12.6
               of the Receivables Transfer Agreement.


<PAGE>

                                                                         20



                    "Reportable Event":  any reportable event as defined in
               Section 4043(b) of ERISA or the regulations issued
               thereunder with respect to a Plan (other than a Plan
               maintained by an ERISA Affiliate which is considered an
               ERISA Affiliate only pursuant to subsection (m) or (o) of
               Section 414 of the Code).

                    "Reporting Day":  as defined in subsection 12.5 of the
               Receivables Transfer Agreement.

                    "Repurchase Amount":  as defined in subsection 2.6 of
               the Receivables Sale Agreement.

                    "Repurchase Event":  as defined in subsection 2.6 of
               the Receivables Sale Agreement.

                    "Required Banks":  Banks having Commitment Percentages
               the sum of which, in the aggregate, is equal to or exceeds
               51%.

                    "Required Reserve Percentage":  as of any day, the sum,
               expressed as a percentage, of (a) the Loss Reserve Ratio,
               (b) the Dilution Reserve Ratio, (c) the Yield Reserve Ratio
               and (d) the Servicing Reserve Ratio.

                    "Requirement of Law":  as to any Person, any law,
               treaty, rule or regulation or determination of an arbitrator
               or a court or other Governmental Authority, in each case
               applicable to or binding upon such Person or any of its
               property or to which such Person or any of its property is
               subject.

                    "Responsible Officer":  with respect to any Person, the
               chief executive officer, the president, any senior vice
               president or any vice president of such Person or, with
               respect to financial matters, the chief financial officer,
               Senior Vice President-Finance and Accounting, Vice
               President-Finance, Controller, or Treasurer of such Person.

                    "Restricted Payments":  as defined in subsection 8.7 of
               the Receivables Transfer Agreement.

                    "Retransfer Payment":  as defined in subsection 5.3(b)
               of the Receivables Transfer Agreement.

                    "S&P":  Standard & Poor's Ratings Group and its
               successors.

                    "Sale Documents":  the Receivables Sale Agreement, the
               Subordinated Notes and the Subordination Agreement.

                    "Sale Termination Date":  as defined in subsection
               9.15(b) of the Receivables Sale Agreement.


<PAGE>

                                                                          21



                    "Sale Transactions":  as defined in subsection 4.1(b)
               of the Receivables Sale Agreement.

                    "Scheduled Termination Date":  the seventh anniversary
               of the Effective Date.

                    "Seller Addition Date":  as defined in subsection 3.4
               of the Receivables Sale Agreement.

                    "Seller Adjustment Payment":  as defined in subsection
               2.5 of the Receivables Sale Agreement.

                    "Seller Daily Report":  as defined in subsection
               12.5(a) of the Receivables Transfer Agreement.

                    "Seller Repurchase Payment":  as defined in subsection
               2.6 of the Receivables Sale Agreement.

                    "Seller Settlement Statement":  as defined in
               subsection 12.5(b) of the Receivables Transfer Agreement.

                    "Sellers":  as defined in the preamble to the
               Receivables Sale Agreement.  

                    "Servicer Default":  any Servicer Event of Default and
               any event or condition that upon notice, lapse of time or
               both would constitute a Servicer Event of Default.

                    "Servicer Event of Default":  as defined in subsection
               12.12 of the Receivables Transfer Agreement.

                    "Servicer Transfer Payment":  as defined in subsection
               12.7 of the Receivables Transfer Agreement.

                    "Servicers":  each Seller party to the Receivables
               Transfer Agreement in its capacity as a servicer (excluding
               any such Sellers which have been terminated as Servicers in
               accordance with the provisions of the Receivables Transfer
               Agreement) together with any other Person which has been
               added as a Servicer in accordance with the provisions of the
               Receivables Transfer Agreement, in their capacities as
               servicers under the Receivables Transfer Agreement.

                    "Servicing Reserve Percentage":  as of any day, 0.25%.

                    "Servicing Reserve Ratio":  as of any day, (a) 2.0
               times (b) the Servicing Reserve Percentage.

                    "Settlement Date":  with respect to any fiscal month,
               the day that is 22 calendar days following the last day of
               such fiscal month (or if such 22nd calendar day is not a
               Business Day, the next succeeding Business Day).


<PAGE>

                                                                         22



                    "Settlement Period":  each fiscal month.

                    "Settlement Statement":  as defined in subsection
               12.5(b) of the Receivables Transfer Agreement.

                    "Settlement Statement Date":  with respect to any
               fiscal month for which a Settlement Statement is required to
               be prepared, the day that is 20 calendar days following the
               last day of such fiscal month (or, if such 20th calendar day
               is not a Business Day, the next succeeding Business Day).

                    "Single Employer Plan":  any Plan which is covered by
               Title IV of ERISA, but which is not a Multiemployer Plan.

                    "Specified Bankruptcy Opinion Provisions":  the
               provisions contained in the legal opinion delivered pursuant
               to subsection 6.1(b)(i) of the Receivables Transfer
               Agreement (and substantially in the form of Exhibit D-2
               thereto) under the headings "Transactions", "Corporate
               Procedures and Financial Effect" and "Disclosure of the
               Transactions".

                    "Statutory Reserves":  a fraction (expressed as a
               decimal), the numerator of which is the number one and the
               denominator of which is the number one minus the aggregate
               of the maximum reserve percentages (including any marginal,
               special, emergency or supplemental reserves) expressed as a
               decimal established by the Board and any other banking
               authority to which the Administrative Agent is subject (a)
               with respect to the Base CD Rate (as such term is used in
               the definition of "ABR"), for new negotiable nonpersonal
               time deposits in dollars of over $100,000 with maturities
               approximately equal to three months, and (b) with respect to
               the Eurodollar Rate, for Eurocurrency Liabilities (as
               defined in Regulation D of the Board).  Such reserve
               percentages shall include those imposed pursuant to such
               Regulation D.  Fixed Tranches shall be deemed to constitute
               Eurocurrency Liabilities and to be subject to such reserve
               requirements without benefit of or credit for proration,
               exemptions or offsets which may be available from time to
               time to any Bank under such Regulation D.  Statutory
               Reserves shall be adjusted automatically on and as of the
               effective date of any change in any reserve percentage.

                    "Subordinated Notes":  as defined in subsection 8.1 of
               the Receivables Sale Agreement.

                    "Subordination Agreement":  the Subordination
               Agreement, dated as of July 13, 1994 among the Sellers, the
               Master Servicer, the Company and the Administrative Agent,
               as amended, supplemented or otherwise modified from time to
               time.

                    "Subsequent Financing Party":  as defined in subsection
               9.4 of the Receivables Sale Agreement.


<PAGE>

                                                                      23



                    "Subsidiary":  with respect to any Person (herein
               referred to as the "parent"), any corporation, partnership,
               association or other business entity (a) of which securities
               or other ownership interests representing more than 50% of
               the equity or more than 50% of the ordinary voting power or
               more than 50% of the general partnership interests are, at
               the time any determination is being made, owned, controlled
               or held, or (b) which is, at the time any determination is
               made, otherwise Controlled, by the parent or one or more
               subsidiaries of the parent or by the parent and one or more
               subsidiaries of the parent.

                    "Substitute Servicer":  as defined in subsection
               12.2(d) of the Receivables Transfer Agreement.

                    "Termination Event":  as defined in Article IX of the
               Receivables Transfer Agreement.

                    "Tranches":  the collective reference to the Floating
               Tranche and the Fixed Tranches.

                    "Transaction Documents":  the Receivables Transfer
               Agreement, the Receivables Sale Agreement, the Subordination
               Agreement and the Lockbox Agreements.

                    "Transaction Parties":  the Company, the Master
               Servicer, the Sellers and the Servicers.

                    "Transactions":  as defined in subsection 5.1(b) of the
               Receivables Transfer Agreement.

                    "Transfer Notice":  as defined in subsection 12.2(d) of
               the Receivables Transfer Agreement.

                    "Transfer Period":  with respect to any portion of the
               Net Investment allocated to a Fixed Tranche:

                         (a)  initially, the period commencing on the
                    Closing Date or conversion date, as the case may be,
                    with respect to such Fixed Tranche and ending one, two,
                    three or six months thereafter, as selected by the
                    Company in its notice of Closing Date or notice of
                    conversion, as the case may be, given with respect
                    thereto; and

                         (b)  thereafter, each period commencing on the
                    last day of the next preceding Transfer Period
                    applicable to such Fixed Tranche and ending one, two,
                    three or six months thereafter, as selected by the
                    Company by irrevocable notice to the Administrative
                    Agent not less than three Business Days prior to the
                    last day of the then current Transfer Period with
                    respect thereto;


<PAGE>

                                                                          24


               provided that, all of the foregoing provisions relating to
               Transfer Periods are subject to the following:

                         (1)  if any Transfer Period would otherwise end on
                    a day that is not a Business Day, such Transfer Period
                    shall be extended to the next succeeding Business Day
                    unless the result of such extension would be to carry
                    such Transfer Period into another calendar month in
                    which event such Transfer Period shall end on the
                    immediately preceding Business Day;

                         (2) any Transfer Period that would otherwise
                    extend beyond the Scheduled Termination Date shall end
                    on the Scheduled Termination Date; and

                         (3) any Transfer Period that begins on the last
                    Business Day of a calendar month (or on a day for which
                    there is no numerically corresponding day in the
                    calendar month at the end of such Transfer Period)
                    shall end on the last Business Day of a calendar month.

                    "Transferee":  as defined in subsection 11.4(g) of the
               Receivables Transfer Agreement.

                    "Transferred Agreement":  as defined in subsection
               2.1(b) of the Receivables Transfer Agreement.

                    "Transferring Servicer":  as defined in subsection
               12.2(d) of the Receivables Transfer Agreement.

                    "U.S. Concentration Account":  as defined in subsection
               2.7(a) of the Receivables Transfer Agreement.

                    "U.S. Dollar Subordinated Note":  as defined in
               subsection 8.1 of the Receivables Sale Agreement.

                    "Withdrawal Liability":  liability to a Multiemployer
               Plan as a result of a complete or partial withdrawal from
               such Multiemployer Plan, as such terms are defined in Part I
               of Subtitle E of Title IV of ERISA.

                    "Write-Offs":  with respect to any Seller, for any
               period, the aggregate amount of Receivables that are written
               off during such period as uncollectible in accordance with
               the Company Policies.

                    "Yield Reserve Ratio":  as of any day, the amount as of
               such day obtained by dividing (a) the product of (i) 1.75,
               (ii) Days Sales Outstanding as of the Settlement Date
               immediately preceding such day and (iii) the Discount Rate
               in effect as of the Settlement Date immediately preceding
               such day by (b) 360.