<PAGE>

                                   (Pillowtex)
     
THIS AGREEMENT made as of July 1, 1998, between Ralph Lauren Home 
Collection, Inc. ("RLHC"), a Delaware corporation with a place of business 
at 103 Foulk Road, Suite 201, Wilmington, Delaware 19803, Polo Ralph Lauren 
Corporation ("PRLC"), a Delaware corporation with a place of business at 650 
Madison Avenue, New York, New York and, Pillowtex Corporation, a Texas 
corporation with a principal place of business at 4111 Mint Way, Dallas 
Texas 75237 ("Company").

                              WITNESSETH:

WHEREAS, RLHC is a subsidiary of PRL USA Holdings, Inc., a Delaware 
corporation ("Polo"); and

WHEREAS, Polo owns, and RLHC is the exclusive licensee of the rights 
to use, the "Licensed Mark", hereinafter defined, in connection with the 
manufacture and sale in the United States of certain items of home 
furnishings, including the "Licensed Products", hereinafter defined; and

WHEREAS, Company desires to obtain, and RLHC is willing to grant, an 
exclusive sublicense to use the Licensed Mark in connection with the 
manufacture and sale of Licensed Products in the United States; and

WHEREAS, Company desires to obtain, and PRLC is willing to provide, 
design, marketing and other services as set forth herein.

NOW, THEREFORE, in consideration of the premises and of the mutual 
covenants and undertakings hereinafter set forth, the parties hereto agree 
as follows:

1.  Definitions.  As used in this Agreement, the term:

    1.1.  "Licensed Products" shall mean those items listed on Schedule 
A attached hereto, all bearing the Licensed Mark, hereinafter defined.

    1.2.  "Licensed Mark" shall mean either the trademark "Ralph Lauren 
Home Collection", "Ralph (Polo Player Design) Lauren", the representation 
of the Polo Player Design or the trademark "Ralph Lauren" and unless the 
context indicates otherwise, all of such trademarks, and any other trademark 
RLHC may, from time to time at its sole discretion, specifically authorize 
for use by Company.  RLHC shall have the sole right to determine which 
trademark shall be used in connection with each particular Licensed Product. 
From time to time RLHC may authorize Company to manufacture and distribute 
products bearing the Licensed Mark not expressly listed in Schedule A 
hereto.  Absent an agreement with respect to such products signed by RLHC 
and Company, all such products shall be deemed Licensed Products for all 
purposes hereunder; provided, however, that Company's rights with respect 
to such products (i) shall be non-exclusive and (ii) may be terminated by 
Company upon 90 days written notice.
<PAGE>

    1.3.  "Territory" shall mean the United States of America and Canada; 
provided, however, that Company shall have no right to sell any Licensed 
Products, and RLHC shall be free to sell or authorize the sale of Licensed 
Products, to hotels, motels and other lodging facilities for use in such 
facilities (but not for retail sale at such facilities).   From time to time 
RLHC may authorize Company to sell certain Licensed Products to specific 
purchasers outside the Territory.  Absent an agreement with respect to such 
sales signed by RLHC and Company, all such sales shall be made on all of the 
terms and conditions set forth in this Agreement; provided, however, that 
Company's right to make such sales shall be non-exclusive and may be 
terminated by RLHC immediately upon written notice to Company. Any such 
termination shall not apply to orders already taken by Company in accordance 
with RLHC's prior authorization.  In accordance with the foregoing, RLHC 
hereby authorizes Company, on an exclusive basis, to sell Licensed Products 
to Corporacion Telmar, RLHC?s distributor of various home furnishings in 
Mexico.

2.  Grant of License.

    2.1.  Subject to the terms and provisions hereof, RLHC hereby grants 
Company, and Company hereby accepts, the exclusive, non-assignable right to 
use the Licensed Mark for the term of this Agreement, in connection with the 
manufacture and sale to the trade of Licensed Products in the Territory.

    2.2.  The sublicense granted herein applies solely to the use of the 
Licensed Mark in connection with the manufacture and sale to the trade of 
the Licensed Products.  No use of any other trademark of RLHC, Polo or of 
any of their affiliates, and no use of the Licensed Mark in connection with 
the manufacture and sale of any other products, shall be authorized or 
permitted pursuant to this sublicense.

    2.3.  RLHC reserves all rights granted to it under its agreement with 
Polo which are not expressly and exclusively granted to Company hereunder, 
and RLHC may grant sublicenses to others in the Territory in connection with 
the items of home furnishings designated in such agreements, except for the 
Licensed Products specifically licensed hereunder.

    2.4.  It is understood and agreed that all right, title and interest 
in and to the Licensed Mark are reserved by Polo for its own use or for the 
use of any other licensee, whether within or outside the Territory, in 
connection with any and all products and services other than the rights 
granted to Company herein.  Without limiting the generality of the 
foregoing, Company understands and agrees that RLHC or Polo may manufacture 
or authorize third parties to manufacture, in the Territory, Licensed 
Products for ultimate sale outside the Territory; provided, however, that 
in the event that any licensee of Licensed Products outside the Territory 
desires to produce Licensed Products within the Territory and does not have 
any affiliates, subsidiaries or related companies within the Territory, then 
Licensor shall suggest the services of Licensee for the production of 
Licensed Products within the Territory for export outside the Territory.
<PAGE>

    2.5.  Company shall not without RLHC's prior written approval sell 
any Licensed Products bearing the Mark to any third party which, directly 
or indirectly, sells or proposes to sell such Licensed Products outside the 
Territory.  Company shall use its best efforts to prevent any such resale 
outside the Territory and shall, immediately upon learning or receiving 
notice from RLHC that a customer is selling Licensed Products outside the 
Territory, cease all sales and deliveries to such customer.

    2.6.  RLHC shall not, without Company's consent, grant to others the 
right and license to use a trademark which bears the words "Polo" or "Ralph 
Lauren" in connection with the Licensed Products within the Territory.  To 
the extent that it is legally possible to do so, no license is granted 
hereunder for the manufacture, sale or distribution of Licensed Products to 
be used for publicity purposes, other than publicity of Licensed Products, 
in combination sales, as premiums or giveaways or to be disposed of under 
or in connection with similar methods of merchandising, such rights being 
specifically reserved for RLHC.

    2.7.  Except as provided in paragraph 23.4 hereof, Company shall not 
purport to grant any right, permission or sublicense hereunder to any third 
party, whether at common law or otherwise.  In the event of any attempted 
assignment or sublicense by Company without RLHC's prior written consent, 
RLHC may at its option immediately terminate such sublicense and this 
Agreement by written notice to Company to such effect; any such attempted 
assignment or sublicense shall otherwise be null, void and of no force or 
effect.

    2.8.  Company shall not use, or permit another person or entity in 
its control to use, the words "Polo", "Ralph Lauren" or any initials 
associated therewith (e.g., "RL" or "PRL") as part of a corporate name or 
tradename and Company shall not otherwise permit use of the Licensed Mark 
in such a way so as to give the impression that the names "Polo" or "Ralph 
Lauren", or the Licensed Mark, or any modification thereof, is the property 
of Company.

    2.9.  Company shall not have the right to use Company's name on the 
Licensed Products, except with the prior approval by RLHC of the use and 
placement of Company's name, in accordance with applicable laws.  Company 
shall, at the option of RLHC upon reasonable notice, include on its business 
materials and/or the Licensed Products an indication of the relationship of 
the parties hereto in a form approved by RLHC.
<PAGE>

    2.10.  Notwithstanding anything to the contrary herein contained, 
RLHC hereby reserves the right from time to time to authorize others to 
manufacture and sell Licensed Products as part of a combination sale, or 
premium or giveaway with certain products other than Licensed Products 
bearing the Ralph Lauren name.

    2.11.  Company shall not, directly or indirectly, manufacture, 
distribute, sell or advertise, during the term of this Agreement, any items 
which bear or are associated with any of the following designers or brands: 
[    *       ], subject to the provisions of that certain letter agreement 
between Company and RLHC dated October 31, 1997. Company shall not be deemed
to have violated the terms of this paragraph 2.11 by virtue of the
continuing manufacture and sale of towels bearing the Nautica trademark by
Leshner Corporation, a subsidiary of Company.

    2.12.  RLHC represents and warrants to Company that it has full legal 
right, power and authority to grant the sublicense hereby granted by RLHC 
to Company, to enter into this Agreement, to perform all of its obligations 
hereunder, and to consummate all of the transactions contemplated herein.

    2.13.  Company represents and warrants to RLHC that it has full legal 
right, power and authority to enter into this Agreement, to perform all of 
its obligations hereunder and to consummate all of the transactions 
contemplated herein.  Company further represents and covenants that it is 
now and at all times shall be adequately capitalized so as to be able to 
conduct its operations contemplated hereunder and to meet the requirements 
of its suppliers in connection therewith.

    2.14.  Company recognizes that there are many uncertainties in the 
business contemplated by this Agreement.  Company agrees and acknowledges 
that other than those representations explicitly contained in this 
Agreement, if any, no representations, warranties or guarantees of any kind 
have been made to Company, either by RLHC, Polo or PRLC, or by anyone acting 
on their behalf.  Without limitation, no representations concerning the 
value of the Licensed Products or the prospects for the level of their sales 
or profits have been made and Company has made its own independent business 
evaluation in deciding to manufacture and distribute the Licensed Products 
on the terms set forth herein.

3.  Design Standards and Prestige of Licensed Products.

    3.1.  PRLC shall provide services in connection with the creation and 
design of Licensed Products, subject to the terms and provisions hereof, in 
order to enable Company to exploit the rights granted to it under this 
Sublicense Agreement and to manufacture Licensed Products in conformity with 
the established prestige and good will of the Licensed Mark.  All Licensed 
Products manufactured or caused to be manufactured and sold by Company shall 
be made in accordance with the design and other information approved under 
this Agreement, and in all other respects in conformity with the terms 
hereof.  In addition to such design services, PRLC shall provide to Company 
sales, advertising, promotional and other services as hereinafter set forth.


*Confidential portion omitted and filed separately with the Commission.  

<PAGE>

    3.2.  Company acknowledges that the Licensed Mark has established 
prestige and good will and is well recognized in the trade and the public, 
and that it is of great importance to RLHC that in the manufacture and sale 
of the various lines of products bearing the Licensed Mark, including the 
Licensed Products, the high standards and reputation Polo and PRLC have 
established be maintained.  The value of the Licensed Mark is derived in 
part from the design services of PRLC.   Accordingly, all items of Licensed 
Products manufactured by Company hereunder shall be of high quality 
workmanship with adherence to all details and characteristics embodied in 
the designs furnished by PRLC pursuant to the provisions of this Agreement. 
Company shall, upon RLHC's request, supply RLHC with samples of Licensed 
Products (including samples of labeling and packaging used in connection 
therewith) prior to production and from time to time during production, and 
shall, at all times during the term hereof, upon RLHC's request, make its 
manufacturing facilities available to RLHC, Polo and/or PRLC, and shall use 
its best efforts to make available each subcontractor's manufacturing 
facilities, for inspection by representatives of RLHC, Polo and/or PRLC 
during usual working hours.  No sales of Licensed Products as miscuts, 
damaged or defective merchandise shall contain any labels or other 
identification bearing the Licensed Mark without Polo's prior written 
approval.

    3.3.   The death or incapacity of Ralph Lauren shall not in any way 
effect PRLC's obligation to provide its services hereunder, or Company?s 
obligation to accept such services.

4.  Marketing; Advertising.

    4.1.   RLHC requires that Company accept the services of and obtain 
certain approvals from PRLC, in the manner hereinafter set forth, in 
connection with the marketing, advertising and sale of Licensed Products. 
Certain Licensed Products, to be designated by RLHC, shall be marketed and 
sold only by PRLC sales group to accounts approved by PRLC.  Company shall 
have no marketing or selling responsibility for such Licensed Products, but 
shall be the manufacturer of all Licensed Products sold in the Territory. 
Company hereby approves PRLC?s authorization of returns of Licensed 
Products during each year up to a cap equal to two percent (2%) of the 
aggregate net sales price of Licensed Products sold in such year, other than 
sales made pursuant to paragraph 10.7 hereof or through approved off-price 
distribution.  At Company's request, PRLC will provide Company with a list 
of all approved accounts to which it has sold Licensed Products for that 
season.  PRLC will notify Company of any additions or deletions to the list. 
Company shall reserve the right to refuse to ship any customer if they do 
not meet Company's normal credit criteria; provided however that Company 
shall first notify PRLC of its decision and Company shall give PRLC the 
opportunity to assist in rectifying the credit situation.  Certain Licensed 
Products, to be designated by RLHC, shall be marketed and sold by Company 
to accounts other than free-standing Polo/Ralph Lauren retail stores in a 
manner consistent with the quality and prestige of the Licensed Mark and 
only to those customers expressly approved by PRLC.  Prior to the opening 
of each selling season, Company shall submit a written list of its customers 
to PRLC for PRLC's approval.  It is understood that such approval shall not 
be unreasonably withheld, and shall be based on considerations of quality 
and prestige of the Licensed Mark.  If Company shall decide during the 
season to sell to customers not previously approved by PRLC, Company shall 
so advise PRLC and shall not sell to such additional customers without the 
approval of PRLC as aforesaid.  Company shall not offer for sale or promote 
the sale of Licensed Products through direct mail, the "Internet", or other 
similar vehicles without PRLC's prior written approval.
<PAGE>

    4.2.  Company shall maintain the high standards of the Licensed Mark 
as applied to Licensed Products, in all packaging and promotion of the 
Licensed Products.  Company shall not employ or otherwise release any of 
such packaging or other business materials relating to any Licensed Products 
and bearing the Licensed Mark unless and until Company shall have made a 
request to PRLC in writing for approval.  Approval or disapproval of any 
such proposed use shall be given by PRLC as promptly as reasonably 
practicable after receipt of Company's request in connection therewith, but 
in all cases within twenty-one (21) business days after receipt by PRLC of 
Company's request; if neither approval nor disapproval has been given within 
such time, approval shall be deemed to have been given.  Any such approval 
shall be effective until revoked by PRLC; provided, however, to the extent 
PRLC's approval relates only to a seasonal collection of Licensed Products, 
Company shall not thereafter use said packaging or business materials 
without PRLC's further approval.

    4.3.  Provided approval to use the Licensed Mark as part of a 
specific piece of packaging or business material remains effective, it shall 
not be necessary to obtain prior approval for each separate, substantially 
similar use of the Licensed Mark containing immaterial changes from the use 
of the Licensed Mark so approved.  Notwithstanding the foregoing, Company 
shall, as soon as is reasonably possible, either prior to publication, 
release or other public showing or immediately thereafter, deliver to PRLC 
a tear sheet, proof or "mock-up" of any such changed use of the Licensed 
Mark, which shall be subject to disapproval by PRLC; if such disapproval 
shall be expressed, the same shall not be used at any later time unless 
approval thereof shall be later obtained.

    4.4.  Anything in this Agreement to the contrary notwithstanding, as 
between RLHC, PRLC and Company, PRLC shall prepare and place any and all 
advertising of any nature with respect to the Licensed Products.  Any and 
all cooperative advertising campaigns supported or approved by Company shall 
be subject to the prior approval of PRLC.  In the event PRLC during the term 
hereof authorizes Company to prepare and place any advertising with respect 
to the Licensed Products, Company shall not place any such advertising 
unless and until Company shall have made a request in writing to PRLC for 
approval of such advertising detailing the use to be made of the advertising 
material (e.g. TV, print, radio), and PRLC shall have approved the same in 
writing.  Any approval granted hereunder shall be limited to use during the 
seasonal collection of Licensed Products to which such advertising relates 
and shall be further limited to the use (e.g. TV, print, radio) for which 
approval by PRLC was granted.
<PAGE>

    4.5.  Company shall maintain the highest quality and standards of the 
Licensed Products and shall exercise its best efforts to safeguard the 
established prestige and good will of the name Ralph Lauren and the Lauren 
image at least at the same level of prestige and good will as heretofore 
maintained.  "Image", as used herein, refers primarily to quality and style 
of packaging, shipping, customer service, promotion, selling tools, creation 
and introduction of new products and types of outlets (with reference to 
quality of service provided by retail outlets and quality of presentation 
of Lauren merchandise in retail outlets).  Company shall take all necessary 
steps, and all steps reasonably requested by RLHC, to prevent or avoid any 
misuse of the Licensed Mark by any of its customers, contractors or other 
resources.

    4.6.  To the extent permitted by applicable law, RLHC may from time 
to time, and in writing, promulgate uniform rules and regulations to Company 
relating to the manner of use of the Licensed Mark.  Company shall comply 
with such rules and regulations.

    4.7.  Company agrees to make available for purchase, and to sell on 
its customary price, credit and payment terms, all lines and styles of 
Licensed Products to retail stores in the Territory bearing any trademark 
of Polo or its affiliates pursuant to a license from Polo or any of its 
affiliates and to any stores or facilities operated or owned by Polo and/or 
its affiliates, which are authorized to sell Licensed Products within such 
retail stores.  Notwithstanding anything to the contrary contained herein, 
in the event that any such Licensed Products are not so made available by 
Company to such stores or facilities, and in addition to any other remedy 
available to RLHC hereunder, such Licensed Products may be made available 
to such stores by RLHC (or its affiliates or other licensees).  RLHC will 
not make available to any retail stores, affiliates or facilities as 
described above, any Licensed Products under this Agreement from any other 
licensee other than Company where the sole reason for Company's refusal to 
ship was based on overdue payments or outstanding bad debts of that party 
due to Company for Licensed Products, other than those based upon good faith 
disputes.

    4.8.  At Company's request, PRLC will provide Company with projected 
sales in order to assist Company with production planning.  PRLC will work 
diligently with Company to sell Licensed Products; provided however that 
PRLC will bear no responsibility for any loss nor will PRLC guarantee to 
Company the sale of the Licensed Products.
<PAGE>

    4.9.  Company shall offer Licensed Products for sale to employees of 
Polo and its licensees for the personal use of such employees at Company's 
regular invoice price to unaffiliated retail accounts.

    4.10. Company shall make a non-refundable contribution toward PRLC's 
advertising expenses on the first day of each year during the term hereof, 
as follows:

          [    *     ]
          [    *     ]
          [    *     ]

Except as otherwise agreed, Company?s contributions shall be used for 
consumer advertising which features Licensed Products, although such 
advertising may also include products of other RLHC licensees in order to 
reflect RLHC design concepts and lifestyles.

5.  Trademark and Copyright Protection.

    5.1.  All uses of the Licensed Mark by Company, including, without 
limitation, use in any business documents, invoices, stationery, 
advertising, promotions, labels, packaging and otherwise, shall be subject 
to paragraph 4 hereof and shall require PRLC's prior written consent, and 
all uses of the Licensed Mark by Company in advertising, promotions, labels 
and packaging shall bear the notation, "Ralph (Polo Player design) Lauren", 
the representation of the Polo Player Design, or "Ralph Lauren".  Company 
acknowledges and agrees that its use of the Licensed Mark shall at all times 
be as sublicensee of RLHC for the account and benefit of RLHC, Polo and 
PRLC.  All uses of the Licensed Mark pursuant to this Agreement shall be for 
the sole benefit of Polo and shall not vest in Company any title to or right 
or presumptive right to continue such use.  For the purposes of trademark 
registrations, sales by Company or RLHC shall be deemed to have been made 
by Polo.


*Confidential portion omitted and filed separately with the Commission.

<PAGE>

    5.2.  Company will cooperate fully, at RLHC's, Polo's or PRLC's 
expense, as the case may be, (provided that RLHC, Polo and/or PRLC shall not 
be responsible for the cost of the time and effort expended by Company's 
officers and employees, provided it is not excessive, in connection with 
furnishing such assistance), and in good faith with RLHC for the purpose of 
securing and preserving RLHC's and Polo's rights in and to the Licensed 
Mark.  Nothing contained in this Agreement shall be construed as an 
assignment or grant to Company of any right, title or interest in or to the 
Licensed Mark or any of RLHC's or Polo's other trademarks, and all rights 
relating thereto are reserved by RLHC and Polo, relative to their respective 
interests therein, except for the sublicense hereunder to Company of the 
right to use the Licensed Mark only as specifically and expressly provided 
herein.  Company acknowledges that only Polo may file and prosecute a 
trademark application or applications to register the Licensed Mark for 
Licensed Products.

    5.3.  Company will not, during the term of this Agreement or 
thereafter, (a) attack Polo's title or rights, or RLHC's rights, in and to 
the Licensed Mark in any jurisdiction, or attack the validity of this 
Sublicense or of the Licensed Mark, or (b) contest the fact that Company's 
rights under this Agreement (i) are solely those of a manufacturer or 
distributor, and (ii) subject to the provisions of paragraph 14 hereof, 
terminate upon termination of this Agreement.  The provisions of this 
paragraph 5.3 shall survive the termination or expiration of this Agreement.

    5.4.  Except as set forth in paragraph 7.1 hereof, all right, title 
and interest in and to all samples, sketches, designs, art work, logos and 
other materials furnished by or to Polo, PRLC or RLHC, whether created by 
Polo, PRLC, RLHC or Company, are hereby assigned in perpetuity to, and shall 
be the sole property of, Polo, RLHC and/or PRLC, as the case may be.  
Company will assist RLHC, Polo and PRLC, at RLHC's, Polo's or PRLC's 
expense, as the case may be, (provided that RLHC, Polo and/or PRLC shall not 
be responsible for the cost of the time and effort expended by Company's 
officers and employees in connection with furnishing such assistance) to the 
extent necessary in the protection of or the procurement of any protection 
of the rights of Polo or PRLC, as the case may be, to the Licensed Mark or 
the designs, design patents or copyrights furnished hereunder, as well as 
to the rights of RLHC to the same.  RLHC, Polo and PRLC, as their interests 
may appear, may commence or prosecute any claims or suits in their own names 
and may join Company as a party thereto at RLHC's, Polo's or PRLC's expense, 
as the case may be, (provided that RLHC, Polo and/or PRLC shall not be 
responsible for the cost of the time and effort expended by Company's 
officers and employees in connection with any such claim or suit).  Company 
shall promptly notify RLHC and Polo in writing of any uses which may be 
infringements or imitations by others of the Licensed Mark on articles 
similar to those covered by this Agreement, and of any uses which may be 
infringements or imitations by others of the designs, design patents and 
copyrights furnished hereunder, which may come to the attention of Company. 
 As between Company and RLHC, RLHC shall have the sole right with respect 
to the Licensed Mark, designs, design patents and copyrights furnished 
hereunder, to determine whether or not any action shall be taken on account 
of such infringements or imitations.  Company shall not institute any suit 
or take any action without first obtaining RLHC's written consent to do so.

6.  Designs.

    6.1.  At any time or from time to time Company shall provide PRLC 
with a list or lists setting forth those Licensed Products for which Company 
shall require designing by PRLC.

    6.2.  At any time or from time to time within a reasonable period 
following receipt by PRLC of the aforesaid lists or lists, PRLC shall 
provide Company, with its program of suggested, broad design themes and 
concepts with respect to the design of the Licensed Products ("Design 
Concepts") which shall be embodied in verbal and/or written descriptions of 
design themes and concepts and such other detailed designs and sketches 
therefor, as PRLC deems appropriate.  PRLC shall have full discretion with 
respect to the manner in which the Design Concepts shall be formulated and 
presented to Company.  PRLC shall be available for consultation with Company 
on Design Concepts for the purpose of making such modifications to the 
Design Concepts as are required to meet PRLC's approval.
<PAGE>

    6.3.  PRLC may engage such employees, agents, and consultants 
operating under PRLC's supervision and control as it may deem necessary and 
appropriate.

    6.4.  From time to time while this Agreement is in effect, PRLC may 
(a) develop or modify and implement designs from PRLC, or (b) develop and 
implement new designs.

    6.5.  If Company wishes to prepare a design for each of its lines of 
Licensed Products, it shall submit to PRLC its proposed design therefor. 
PRLC may, in its sole discretion, by written notice, approve any of the 
designs so furnished, with such modifications as it shall deem appropriate, 
or it may disapprove any or all of the designs.

    6.6.  All patents and copyrights on designs, and all art work, 
sketches, logos and other materials depicting the designs or Design Concepts 
shall only be applied for by PRLC, at its discretion and expense, and shall 
designate PRLC as the patent or copyright owner, as the case may be, 
thereof.

    6.7.  Company shall include within its collection of Licensed 
Products each design designated by PRLC for inclusion therein.  The 
foregoing notwithstanding, in the event Company is unable, in good faith and 
due only to physical impossibility or economic impracticability, to include 
within a collection of Licensed Products a particular Licensed Product which 
PRLC has designed or designated for inclusion in such collection, RLHC shall 
be entitled to authorize third parties to manufacture and sell such Licensed 
Products within the Territory and Company shall display and present such 
Licensed Products in its showroom for Licensed Products.

7.  Design Legends:  Copyright Notice and Grant.

    7.1.  All designs, and all art work, sketches, logos and other 
materials depicting the designs or Design Concepts created by PRLC, or 
created by or for Company and reviewed and approved by PRLC or developed by 
or for Company from Design Concepts or subsequent design concepts furnished 
or approved by PRLC, shall be subject to the provisions of this paragraph 
7 and shall be owned exclusively by PRLC;  provided, however that all rights 
(including copyrights) in designs, and all sketches, artwork and other 
materials embodying such designs, first proposed by Company to PRLC which 
are rejected by PRLC and which are not substantially similar to designs (i) 
first proposed by PRLC or (ii) proposed by Company and accepted by PRLC in 
whole or in part for use in connection with Licensed Products, shall be 
owned exclusively by Company.
<PAGE>

    7.2.  Company shall cause to be placed on all Licensed Products, when 
necessary, appropriate notices designating PRLC as the copyright or design 
patent owner thereof, as the case may be.  Prior to use thereof by Company, 
the manner of presentation of said notices must be reviewed and approved in 
writing by PRLC.

    7.3.  PRLC hereby grants to Company the exclusive right, sublicense 
and privilege in connection with Licensed Products in the Territory to use 
the designs furnished hereunder and all copyrights, if any, therein, and 
hereby sublicenses to Company the right to use all patents on such designs, 
and shall execute and deliver to Company all documents and instruments 
necessary to perfect or evidence such sublicense; provided, however, that 
all such right, title and interest therein shall revert to PRLC upon 
termination of this Agreement for any reason whatsoever, and Company shall 
thereupon execute and deliver to PRLC all documents and instruments 
necessary to perfect or evidence such reversions and, provided, further, 
that such sublicense is limited to use in connection with Licensed Products 
authorized to be manufactured and sold from time to time pursuant to this 
Sublicense Agreement.  Such sublicense shall continue only during the term 
of this Agreement.

8.  Licensed Products.

    8.1.  RLHC requires that Company shall obtain the written approval of 
PRLC of all Licensed Products, by submitting a Prototype, as hereinafter 
defined, of each different design or model of a Licensed Product, including, 
but not limited to, the type and quality of materials, colors and 
workmanship to be used in connection therewith, prior to any commercial 
production thereof.  In the event that PRLC rejects a particular Prototype 
or Prototypes, Company shall be notified of the reasons for rejection and 
Company may be provided with suggestions for modifying the particular 
Prototype or Prototypes which PRLC is rejecting.  Company shall promptly 
correct said Prototype or Prototypes and resubmit said Prototype or 
Prototypes for PRLC's approval under the same terms and conditions as set 
forth herein with respect to the first submission of Prototypes.  As used 
herein, the term "Prototype" shall mean any and all models, or actual 
samples, of Licensed Products; and the term "Final Prototype" shall mean the 
actual final sample of a Licensed Product from which the first commercial 
production thereof will be made and which has been approved by PRLC prior 
to the first commercial production thereof pursuant to paragraphs 8 and 9 
hereof.
<PAGE>

    8.2.  The written approval of PRLC of the Prototypes for each 
seasonal collection shall be evidenced by a written list, signed on behalf 
of PRLC, setting forth those Prototypes that have been approved for 
inclusion in such collection.  Prototypes so approved shall be deemed Final 
Prototypes in respect of such collection.  Approval of any and all 
Prototypes as Final Prototypes shall be in the sole discretion of PRLC.  
Company shall present for sale, through the showing of each seasonal 
collection to the trade, all Final Prototypes so approved in respect of such 
collection.

    8.3.  The Licensed Products thereafter manufactured and sold by 
Company shall strictly adhere, in all respects, including without 
limitation, with respect to materials, colors, workmanship dimensions, 
styling, detail and quality, to the Prototypes approved by PRLC.

    8.4.  Company shall comply with all laws, rules, regulations and 
requirements of any governmental body which may be applicable to the 
manufacture, distribution, sale or promotion of Licensed Products.  Company 
shall advise RLHC to the extent any Final Prototype does not comply with any 
such law, rule, regulation or requirement.

    8.5.  Company shall make its personnel, and shall use its best 
efforts to make the personnel of any of its contractors, suppliers and other 
resources, available by appointment during normal business hours for 
consultation with PRLC.  Company shall make available to RLHC, upon 
reasonable notice, marketing plans, reports and information which Company 
may have with respect to Licensed Products.  In addition, when requested by 
PRLC, Company shall arrange meetings between PRLC and senior executive 
personnel of Company to discuss and pursue in good faith the resolution of 
problems encountered by PRLC in connection with this Agreement during the 
term hereof.

9.  Quality of Licensed Products.

    9.1.  RLHC requires that Company obtain from PRLC its approval of the 
styles, designs, colors, materials, workmanship and quality of all Licensed 
Products to insure that all Licensed Products manufactured, sold or 
distributed are of the highest quality and are consistent with the highest 
standards and reputation and established prestige and good will connected 
with the name "Ralph Lauren".  In connection with the production of each 
item of Licensed Products, Company shall use only such materials as PRLC 
shall have previously approved pursuant to the Final Prototype with respect 
to such item of Licensed Products.
<PAGE>

    9.2.  In the event that any Licensed Product is, in the judgment of 
PRLC, not being manufactured or sold in adherence to the materials, colors, 
workmanship, design, dimensions, styling, detail and quality embodied in the 
Final Prototypes, or is otherwise not in accordance with the Final 
Prototypes, PRLC shall notify Company thereof in writing and Company shall 
promptly repair or change such Licensed Product to conform strictly thereto. 
If an item of Licensed Product as repaired or changed does not strictly 
conform to the Final Prototypes and such strict conformity cannot be 
obtained after at least one (1) resubmission, the Licensed Mark shall be 
promptly removed from the item, at the option of PRLC, in which event the 
item may be sold by Company, subject to the royalty provisions of Paragraph 
10 hereof, provided it is in no way identified as a Licensed Product.

    9.3.  RLHC and PRLC and their duly authorized representatives shall 
have the right, upon reasonable notice during normal business hours, to 
inspect all facilities utilized by Company (and its contractors and 
suppliers) in connection with the preparation of Prototypes and the 
manufacture, sale, storage or distribution of Licensed Products pursuant 
hereto and to examine Licensed Products in the process of manufacture and 
when offered for sale within Company's operations.  Company hereby consents 
to examination by RLHC and PRLC of Licensed Products held by Company's 
customers for resale provided Company has such right of examination.  
Company shall take all necessary steps, and all steps reasonably requested 
by RLHC and PRLC, to prevent or avoid any misuse of the licensed designs by 
any of its customers, contractors or other resources.

10. Royalties.

    10.1.  Company shall pay to RLHC minimum royalties each year during 
the term of this Sublicense Agreement.  The minimum royalty

           a. for the first year (as hereinafter defined) shall be [  *  ];
              and

           b.  for the second year shall be [   *    ]; and

           c.  for the third year shall be [    *     ].

    Minimum royalties for each year shall be paid in four equal quarterly 
installments, on the last day of each quarter during the term hereof 
commencing with the payment to be made on September 30, 1998.  With respect 
to any quarterly period ended the last day of September, December, March and 
June of any year of this Agreement, any excess of the aggregate minimum 
royalties over earned royalties, as described in paragraph 10.2 hereof, for 
any quarterly period, shall be set off against earned royalties in the 
subsequent quarterly periods of the same year; provided, however, that no 
credit shall be permitted against minimum royalties payable in any year on 
account of earned or minimum royalties paid in any other year and minimum 
royalties shall not be returnable.  For the purposes of this Agreement, a 
"year" shall mean a period of twelve (12) months commencing on each July 1 
during the term hereof.


* Confidential portion omitted and filed separately with the Commission.

<PAGE>

    10.2.  In consideration of all rights granted and services rendered by 
RLCH and PRLC hereunder, Company shall pay to RLHC and PRLC earned royalties 
based on the Net Sales Price, as hereinafter defined, of all Licensed 
Products sold hereunder.  Except as may otherwise be agreed upon in writing, 
earned royalties shall equal the following percentages of the Net Sales 
Price of all Licensed Products sold pursuant to this Agreement, including 
without limitation any sales made pursuant to the terms of paragraphs 3.3, 
9.2 and 14 hereof:  (i) [   *    ] with respect to all sales by PRLC's
sales force; (ii) [   *   ] with respect to all sales by Company's sales
force and with respect to all bed pillows and mattress pads (irrespective
of the sales force), and (iii) [  *   ] with repsect toa ll down comforters
(irrespective of the sales force).  Statements of operations shall be
prepared and furnished by Company to RLHC in accordance with the provisions
of paragraph 11 hereof, with respect to each quarterly period ended the
last day of September, December, March and June in each year hereof, and
shall be furnished to RLHC within thirty (30) days of the end of each such
period.  Any excess of earned royalties over the minimum royalities
provided in paragraph 10.1 hereof, shall be remitted to RLHC within (30)
days after the end of each quarterly period.  The term "Net Sales Price"
shall mean the gross sales price to retailers or, with respect to
Licensed Products that are not sold directly or indirectly to retailers,
other ultimate consumers (as in the case of accommodation sales 
by Company to its employees), of all sales of Licensed Products sold under 
this Agreement, less trade discounts actually taken, merchandise returns and 
bad debts; provided, however, that bad debts may only be deducted in the 
event that Company's debtor has commenced judicial proceedings seeking 
relief under the Bankruptcy Code, and Company shall be liable for earned 
royalties on all amounts, if any, it may eventually recover in such 
proceedings, whether such recovery takes place during or after the term of 
this Agreement.  The Net Sales Price of any Licensed Products sold by 
Company to affiliates of Company shall, for purposes of this Agreement, be 
deemed to be the higher of (a) the actual gross sales price, or (b) 
Company's regular selling price for such Licensed Products sold to 
unaffiliated parties for sale at retail.  Merchandise returns shall be 
credited in the quarterly period in which the returns are actually made.


*Confidential portion omitted and filed separately with the Commission.

<PAGE>

    10.3.  Company shall reimburse PRLC for all travel expenses incurred 
by RLHC or PRLC with respect to design development and approval pursuant to 
this Agreement, and for any additional trips made at Company's request; 
provided, however, that all such travel shall be pre-approved by Company.

    10.4.  If the payment of any installment of royalties is delayed for 
any reason, interest shall accrue on the unpaid principal amount of such 
installment from and after the date on which the same became due 
pursuant to paragraphs 10.1 and 10.2 hereof at the lower of the highest rate
permitted by law in New York and 2% per annum above the rate of interest
published from time to time by Chemical Bank, New York, New York (or any
successor bank) as its reference rate, or, if such rate is not published,
then the nearest equivalent rate thereto then published by Chemical Bank.

    10.5.  The obligation of Company to pay royalties hereunder shall be 
absolute notwithstanding any claim Company may assert against RLHC, Polo, 
Lauren or PRLC.  Company shall not have the right to set off, compensate or 
make any deduction from such royalty payments for any reason whatsoever.

    10.6.  All payments of royalties due to RLHC and PRLC shall, unless 
RLHC shall otherwise direct by written notice to Company, be made by wire 
transfer on the date due, which wire transfer shall be directed to RLHC, on 
its own behalf and as agent for PRLC, as follows:  

Chase Manhattan Bank Delaware
1201 Market Street, Wilmington, Delaware, 19801-1167,
ABA#031100267
Account Name and Number: Ralph Lauren Home Collection, Inc.: 6301-225193-500 

    10.7.  In consideration of the rights granted herein, Company shall sell 
and timely ship to "New Stores" (as hereinafter defined) such Licensed Products 
as they may wish to purchase, at a discount not less than the following 
percentages off the regular wholesale price: (i) [   *    ] with 
respect to Licensed Products on which the earned royalty rate pursuant to 
paragraph 10.2 hereof is [   *    ] or less, (ii) [   *   ] with respect to
Licensed Products on which the earned royalty rate pursuant to paragraph
10.2 hereof is more than [    *    ] but not more than [   *   ], and
(iii) [   *   ] with respect to Licensed Products on which the earned
royalty rate pursuant to paragraph 10.2 hereof is more than [  *   ].
As used herein, the term "New Stores", including the one in Oakbrook,
Illinois, shall mean all full price free-standing stores operating under
any service mark or tradename associated with Ralph Lauren which opened or
is relocated on or after January 1, 1998, regardless of the product mix,
size, location or configuration of such stores and "free-standing stores"
shall mean stores which are operating as separate units not a department
or sub-unit of a larger store.  No royalty shall be due pursuant to
paragraph 10.2 hereof with respect to any sales by Company to New Stores
pursuant to this paragraph 10.6, but Company shall as soon as reasonably
practical separately report all such sales in the accounting statements
required hereunder.  Also in consideration of the rights granted herein,
Company shall sell and timely ship Licensed Products to "Polo Outlet Stores"
(as each such term is hereinafter defined), to the extent of their


* Confidential portion omitted and filed separately with the Commission
<PAGE>

requirements on a priority basis in relation to any other secondary
distribution of Licensed Products, at a discount which shall 
be negotiated on a case-by-case basis consistent with the prior dealings 
between the parties in respect of excess and irregular inventory taking into 
account the age, condition and quantity of merchandise to be disposed of. 
All such sales shall as soon as reasonably practical be separately reported 
by Company in its accounting statements pursuant to paragraph 10.2 hereof, 
and such sales shall be subject to the royalty obligations set forth herein 
unless otherwise agreed by RLHC and Company.  "Polo Outlet Stores", as used 
herein, shall mean all "outlet" or "factory" stores doing business under any 
Polo/Ralph Lauren service mark or tradename.

11.  Accounting; Records.

    11.1.  Company shall at all times keep an accurate account of all
operations within the scope of this Agreement and shall prepare and furnish
to RLHC full statements of operations with respect to each quarter in each
year during the term of this Agreement within thirty (30) days of the end
of such period.  Such statements shall include, on a country-by-country basis,
all aggregate gross sales, trade discounts, merchandise returns and the Net 
Sales Price of all sales of License Products for the previous quarterly 
period.  Such statements shall be in sufficient detail to be audited from 
the books of Company and shall be certified by a financial officer of 
Company.  Once each year, which may be in connection with the regular annual 
audit of Company's books, Company shall furnish an annual statement of the 
aggregate gross sales, trade discounts, merchandise returns and Net Sales 
Price of all sales of Licensed Products made by Company certified by the 
independent public accountant of Company.

    11.2  RLHC and its duly authorized representatives, on reasonable 
notice, shall have the right, no more than once in each year during regular 
business hours, for the duration of the term of this Agreement and for three 
(3) years thereafter, to examine the books of account and records and all 
other documents, materials and inventory in the possession or under the 
control of Company and its successors with respect to the subject matter of 
this Agreement.  All such books of account, records and documents shall be 
maintained and kept available by Company for at least the duration of this 
Agreement and for three (3) years thereafter.  RLHC shall have free and full 
access thereto in the manner set forth above and shall have the right to 
make copies and/or extracts therefrom.  If as a result of any examination 
of Company's books and records it is shown that Company's payments to RLHC 
hereunder with respect to any twelve (12) month period were less than or 
greater than the amount which should have been paid to RLHC by an amount 
equal to two percent (2%) of the amount which should have been paid during
such twelve (12) month period, Company will, in addition to reimbursement
of any underpayment, with interest from the date on which each payment was
due at the rate set forth in paragraph 6.3 hereof, promptly reimburse RLHC
for the cost of such examination.

<PAGE>

    11.3.  Company shall provide to RLHC in the form requested such 
information as RLHC may reasonably request with respect to the manufacture, 
distribution and sale of Licensed Products.

12. Term.

    The initial term of this Agreement shall commence on the date hereof and 
shall terminate on June 30, 2001, unless earlier terminated in accordance 
with the terms hereof.  It is expressly understood that only the company 
(which may be Company) whose licensed term covers the period subsequent to 
the expiration of this Agreement shall be entitled to receive designs for 
Licensed Products intended to be sold after the expiration of this 
Agreement, and to make presentations of such Licensed Products during the 
market presentation weeks that relate to such subsequent period, even if 
such market presentation occurs prior to the termination of this Agreement. 
Without limiting the generality of the foregoing, in the event the term 
hereof is not renewed or extended, the last season for which the Company 
shall be entitled to receive designs and, during the term hereof, to 
manufacture and sell Licensed Products shall be the Spring 2001 season, and 
RLHC shall be entitled to undertake, directly or through a successor 
licensee, all activities associated with the design, manufacture and sale 
Licensed Products commencing with the Fall 2001 season.

13. Default; Change of Business.

    13.1. Each of the following shall constitute an event of default 
("Event of Default") hereunder:

          (i)  Royalty payments are not paid when due and such default 
continues for more than ten (10) days after notice thereof;

          (ii) Company shall fail to timely present for sale to the trade a 
broadly representative and fair collection of each seasonal collection of 
Licensed Products designed by the Design artnership or Company shall fail to
timely ship to its customers a material portion of the orders of Licensed
Products it has accepted;

          (iii)     Company fails within ten (10) days after written notice
from RLHC that payment is overdue to pay for any Licensed Products or
materials, trim, fabrics, packaging or services relating to Licensed Products
purchased by Company from RLHC or Polo or any agent or licensee of RLHC or Polo
or any other supplier of such items unless Company is in good faith contesting
the amount or liability for such payment;
<PAGE>

          (iv) If Company shall, after achieving distribution and sale of the 
Licensed Products throughout the Territory, thereafter fail for a consecutive
period in excess of two (2) months to continue the bona fide manufacture,
distribution and sale of the Licensed Product; or

          (v)  If a deliberate deficiency in reported Net Sales occurs or if 
any other deliberate misstatements are made in reports required or requested
hereunder; or

          (vi) If the quality of the Licensed Products should become lower 
than that in the approved Prototypes referred to in paragraph 8 hereof, and
such decline in quality is not cured within thirty (30) days after notice
thereof; or

          (vii)     If Company shall use the Licensed Marks in an unauthorized
or 
improper manner and/or if Company shall make an unauthorized disclosure of
confidential information or materials given or loaned to Company by Polo,
the Design Partnership and or RLHC; or

          (viii)    Company defaults in performing any of the terms of this 
Agreement and continue in default for a period of thirty (30) days after
notice thereof (unless the default cannot be totally cured within the initial
thirty (30) day period after notice and Company diligently and continuously
proceeds to cure and does in fact cure such default, but within no later than
ninety (90) days following such initial period);

          (ix) Company institutes proceedings seeking relief under the 
Bankruptcy Code or any similar law, or consents to entry of an order for
relief against it in any bankruptcy or insolvency proceeding or similar
proceeding, or files a petition or answer or consents for reorganization or
other relief under any bankruptcy act or other similar law, or consents to
the filing against it of any petition for the appointment of a receiver, 
liquidator, assignee, trustee, sequestrator (or other similar official)
of it or of any substantial part of its property, or makes an assignment for
the benefit of creditors, or admits in writing its inability to pay its
debts as they become due, or takes any action in furtherance of the
foregoing;

          (x)  Company transfers or agrees to transfer a substantial part of 
its property (except as provided in paragraph 13.3 below);
<PAGE>

          (xi) The calling of a meeting of creditors, appointment of a 
committee of creditors or liquidating agents, or offering of a 
composition or extension to creditors by, for, or of Company.

          (xii)     There shall be a change in control of Company such that
Charles Hansen is no longer in all material respects responsible with 
individual authority as officer of Company, to unconditionally 
bind Company in connection with the operations contemplated by 
this Agreement, including, without limitation, the performance 
of Company's duties and obligations under this Agreement; 
provided, however, that no event of default under this 
paragraph 13.1(xii) shall be deemed to have occurred if such 
change of control occurs as a result of any assignment of this 
Agreement made in accordance with all the terms and conditions 
contained in paragraph 23.4 hereof.

    13.2.  If any Event of Default shall occur, RLHC, Polo or PRLC, or 
any of them, shall have the right, exercisable in its discretion, 
immediately to terminate this Agreement and the sublicense upon ten (10) 
days written notice to Company of its intention to do so, and upon the 
expiration of such ten (10) day period, this Agreement and the sublicense, 
including, without limitation, all rights of Company in and to the Licensed 
Mark, and in and to the designs furnished or used hereunder and all 
copyrights therein and design patents thereon, shall terminate and come to 
an end without prejudice to any remedy of RLHC for the recovery of any 
monies (including attorneys' fees for collection) then due it under this 
Agreement or in respect of any antecedent breach of this Agreement, and 
without prejudice to any other right of RLHC, including without limitation, 
damages for breach to the extent that the same may be recoverable.  No 
assignee for the benefit of creditors, receiver, liquidator, sequestrator, 
trustee in bankruptcy, sheriff or any other officer of the court or official 
charged with taking over custody of Company's assets or business shall have 
any right to continue the performance of this Agreement.

     13.3.  During the term of this Agreement, Company shall not dissolve, 
liquidate or wind-up its business.  In addition, Company shall not, without 
prior written notice to RLHC, (i) merge or consolidate with or into any 
other corporation, or (ii) directly or indirectly sell or otherwise dispose 
of all or a substantial portion of its business or assets.  RLHC shall have 
the option, upon receipt of such notice, to terminate this Agreement unless 
the same persons who shall have been working for Company with respect to 
RLHC and the Licensed Products shall continue to perform such services after 
either event (i) or (ii).

14.  Disposal of Stock upon Termination or Expiration.

     14.1.  Within ten (10) days following the termination of this 
Agreement for any reason whatsoever including the expiration of the term 
hereof, and on the last day of each month during the disposal period set 
forth in paragraph 14.2 hereof, Company shall furnish to RLHC a certificate 
of Company listing its inventories of Licensed Products (which defined term 
for purposes of this paragraph 14.1 shall include all materials, trim and 
packaging which are used in the manufacture and marketing of Licensed 
Products) on hand or in process wherever situated.  RLHC shall have the 
right to conduct a physical inventory of Licensed Products in Company's 
possession or under Company's control.  RLHC or RLHC's designee shall have 
the option (but not the obligation) to purchase from Company all or any part 
of Company's then existing inventory of Licensed Products upon the following 
terms and conditions:
<PAGE>

          (i)       RLHC shall notify Company of its or its designee's 
intention to exercise the foregoing option within thirty 
(30) days of delivery of the certificate referred to 
above and shall specify the items of Licensed Products to 
be purchased.

          (ii)      The price for Licensed Products manufactured by Company 
or its affiliates on hand or in process shall be Company's standard 
cost (the actual manufacturing cost) for each such Licensed Product.
The price for all other Licensed Products which are not manufactured
by Company or its affiliates shall be Company's landed costs therefor.
Landed costs for the purposes hereof means the F.O.B. price of the Licensed
Products together with customs, duties, brokerage, freight and insurance costs.

          (iii)          Company shall deliver the Licensed Products purchased 
within fifteen (15) days of receipt of the notice referred to in clause
(i) above.  Payment of the purchase price for the Licensed Products so
purchased by RLHC or its designee shall be payable upon delivery thereof,
provided, that RLHC shall be entitled to deduct from such purchase price
any amounts owed it by Company (and/or to direct payment of any part of
such merchandise to any supplier of Licensed Products in order to reduce an 
outstanding balance due to such supplier from Company).

     14.2.  In the event RLHC chooses not to exercise the option referred 
to in paragraph 14.1 hereof with respect to all or any portion of Licensed 
Products, for a period of one hundred and twenty (120) days after 
termination of this Agreement for any reason whatsoever, except on account 
of breach of the provisions of paragraphs 3, 4 or 10 hereof, Company may 
dispose of Licensed Products which are on hand or in the process of being 
manufactured at the time of termination of this Agreement, provided Company 
fully complies with the provisions of this Agreement, including specifically 
those contained in paragraphs 3, 4 or 10 hereof in connection with such 
disposal.  Such sales shall be subject to the payment of earned royalties 
pursuant to paragraph 10.2.  Failure by Company to timely submit the 
certificates of inventory as set forth in paragraph 14.1 hereof shall 
deprive Company of its right of disposal of stock pursuant to this paragraph 
14.
<PAGE>

     14.3.  Notwithstanding anything to the contrary contained herein, in 
the event that upon the expiration or termination of the term hereof for any 
reason Company has not rendered to RLHC all accounting statements then due, 
and paid (i) all royalties and other amounts then due to RLHC and (ii) all 
amounts then due to any affiliate of or supplier to RLHC or its affiliates 
(collectively, "Payments"), Company shall have no right whatsoever to 
dispose of any inventory of Licensed Products in any manner.  In addition, 
if during any disposal period Company fails timely to render any accounting 
statements or to make all Payments when due, Company's disposal rights 
hereunder shall immediately terminate without notice, unless all accounting 
statements are rendered and Payments made within three (3) days after 
written notice.

     14.4.  In the event no Event of Default has occurred and not been 
cured pursuant to paragraph 13.1 and RLHC elects not to renew the term of 
this Agreement upon its expiration, RLHC shall endeavor to give Company 
notice of such election not less than one hundred and eighty (180) days 
prior to the expiration of the term.  Company's sole remedy in the event 
RLHC gives such notice of election less than one hundred and eighty (180) 
days prior to the expiration of the term shall be to extend the disposal 
period provided for in paragraph 14.2 by the number of days by which such 
notice of election was late, up to a maximum extension of one hundred and 
eighty (180) days.

15.  Effect of Termination.

     15.1.  Except for the sublicense to use the Licensed Mark and the 
designs furnished hereunder only as specifically provided in this Agreement, 
Company shall have no right, title or interest in or to the Licensed Mark, 
the designs furnished hereunder and design patents thereon, and all 
copyrights licensed hereby.  Upon and after the termination of this 
sublicense, all rights granted to Company hereunder, including without 
limitation all right, title and interest in or with respect to all designs, 
art works, sketches and other materials depicting or relating to the 
Licensed Products, together with any interest in and to the Licensed Mark 
Company may acquire, shall forthwith automatically and without further 
action or instrument be assigned to and revert to Polo, PRLC and RLHC, as 
their interests may appear.  Company will execute any instruments requested 
by RLHC to accomplish or confirm the foregoing.  Any such assignment, 
transfer or conveyance shall be without consideration other than the mutual 
agreements contained herein.  RLHC shall thereafter be free to license to 
others the use of the Licensed Mark in connection with the manufacture and 
sale of the Licensed Products covered hereby, and Company will, except as 
specifically provided in paragraph 14 hereof, (i) refrain from any further 
use of the Licensed Mark or any reference to it, direct or indirect, or 
anything deemed by RLHC or Polo to be similar to the Licensed Mark, (ii) 
refrain from further use of any of the Design Concepts, and (iii) refrain 
from manufacturing, selling or distributing any products (whether or not 
they bear the Licensed Mark) which are confusingly similar to, or derived 
from, the Licensed Products or Design Concepts, in connection with the 
manufacture, sale or distribution of Company's products.  Upon termination 
of this Agreement, Company shall forthwith cease the use of the words "Ralph 
Lauren" and/or the Polo Player Design in any and all respects.  It is 
expressly understood that under no circumstances shall Company be entitled, 
directly or indirectly, to any form of compensation or indemnity from RLHC, 
Ralph Lauren, Polo, PRLC or their affiliates, as a consequence to the 
termination of this Agreement, whether as a result of the passage of time, 
or as the result of any other cause of termination referred to in this 
Agreement. Without limiting the generality of the foregoing, by its 
execution of the present Agreement, Company hereby waives any claim which 
it has or which it may have in the future against RLHC, Polo, PRLC, Ralph 
Lauren or their affiliates, arising from any alleged goodwill created by 
Company for the benefit of any or all of the said parties or from the 
alleged creation or increase of a market for Licensed Products.
<PAGE>

     15.2.  Notwithstanding any termination or expiration of this 
Agreement (whether by reason of the expiration of the stated term of this 
Agreement, by earlier termination of this Agreement pursuant to paragraph 
13 hereof, or otherwise) (a) RLHC shall have and hereby reserves all rights 
and remedies which it may have, at law or in equity, with respect to the 
collection of royalties or other funds payable by Company pursuant to this 
Agreement and the enforcement of all rights relating to the establishment, 
maintenance or protection of the Licensed Mark and the designs furnished 
hereunder, and (b) Company and RLHC shall continue to have rights and 
remedies with respect to damages for breach of this Agreement on the part 
of the other.

16.  Remedies.

     Company acknowledges and admits that there would be no adequate 
remedy at law for its failure (except as otherwise provided in paragraph 14 
hereof) to cease the use of the Licensed Mark, or the designs, or the 
manufacture and sale of the Licensed Products covered by this Agreement at 
the termination or expiration hereof, and Company agrees that in the event 
of such failure RLHC, Polo and PRLC, or any of them, shall be entitled to 
equitable relief by way of temporary and permanent injunction and such other 
and further relief as any court with jurisdiction may deem just and proper. 
 Such relief shall be in addition to and not in substitution of any other 
remedies available to RLHC, Polo and PRLC, or any of them, pursuant to this 
Agreement or otherwise.

17.  Key Personnel.

     Company shall at all times during the term hereof employ a vice 
president reasonably satisfactory to RLHC whose sole material responsibility 
shall be to oversee the entire business contemplated by this Agreement.  
Company shall also employ at all times during the term hereof a business 
manager for the bedding business contemplated herein reasonably satisfactory 
to RLHC.  In addition, Company shall consult in good faith with RLHC 
regarding the establishment and filling of key positions with respect to all 
aspects of the business contemplated herein.
<PAGE>

18.  Indemnity.

     18.1.  RLHC shall indemnify and hold harmless Company from and 
against any and all liability, claims, causes of action, suits, damages and 
expenses (including reasonable attorneys' fees and expenses in actions 
involving third parties or between the parties hereto) which Company is or 
becomes liable for, or may incur solely by reason of its use within the 
Territory, in strict accordance with the terms and conditions of this 
Agreement, of the Licensed Mark or the designs furnished to Company by RLHC 
or PRLC, to the extent that such liability arises through infringement of 
another's design patent, trademark, copyright or other proprietary rights; 
provided that Company gives RLHC prompt notice of, and full cooperation in 
the defense against, such claim.  If any action or proceeding shall be 
brought or asserted against Company in respect of which indemnity may be 
sought from RLHC under this paragraph 18.1, Company shall promptly notify 
RLHC thereof in writing, and RLHC shall assume and direct the defense 
thereof.  Company may thereafter, at its own expense, be represented by its 
own counsel in such action or proceeding.  

     18.2.  To the extent not inconsistent with paragraph 18.1 hereof, 
Company shall indemnify and save and hold RLHC, Polo, PRLC and Ralph Lauren, 
individually, (together, the ?Indemnified Parties?) harmless from and 
against any and all liability, claims, causes of action, suits, damages and 
expenses (including reasonable attorneys' fees and expenses in actions 
involving third parties or between the parties hereto), which they, or any 
of them, are or become liable for, or may incur, or be compelled to pay by 
reason of any acts, whether of omission or commission, that may be committed 
or suffered by Company or any of its servants, agents or employees in 
connection with Company's performance of this Agreement, including Company's 
use of Company's own designs, in connection with Licensed Products 
manufactured by or on behalf of Company or otherwise in connection with 
Company's business.

     18.3.  Company shall carry product liability insurance with limits of 
liability in the minimum amount, in addition to defense costs, of $3,000,000 
per occurrence and $3,000,000 per person and each of the Indemnified Parties 
shall be named therein as insureds, as their interests may appear.  The 
maximum deductible with respect to such insurance shall be $150,000.  
Company shall, promptly after the signing of this Agreement, deliver to RLHC 
a certificate of such insurance from the insurance carrier, setting forth 
the scope of coverage and the limits of liability and providing that the 
policy may not be canceled or amended without at least thirty (30) days 
prior written notice to the Indemnified Parties.
<PAGE>

19.  Disclosure.

     RLHC and Company, and their affiliates, employees, attorneys and 
accountants, shall hold in confidence and not use or disclose, except as 
permitted by this Agreement, (i) confidential information of the other, or 
(ii) the terms of this Agreement, except upon consent of the other or 
pursuant to or as may be required by law, or in connection with regulatory 
or administrative proceedings and only then with reasonable advance notice 
of such disclosure to the other.  Company shall take all reasonable 
precautions to protect the secrecy of the designs, art work, sketches and 
other materials used pursuant to this Agreement prior to the commercial 
distribution or the showing of samples for sale, and shall not sell any 
merchandise employing, or adapted from or resulting from the use of any such 
designs, art work, sketches or other material, except under the Licensed 
Marks.  All press releases and other public announcements shall be subject 
to the prior approval of RLHC.  Every request for a statement, release or 
other inquiry shall be sent in writing whenever practicable to the 
advertising/publicity director of RLHC for handling.

20.  Brokers.

     Each of RLHC and Company hereby represents and warrants to the other 
that it has not employed or dealt with any broker or finder in connection 
with this Agreement or the transactions contemplated hereby, and agrees to 
indemnify the other and hold it harmless from any and all liabilities 
(including, without limitation, reasonable attorneys' fees and disbursements 
paid or incurred in connection with any such liabilities) for any brokerage 
commissions or finders' fees in connection with this Agreement or the 
transactions contemplated hereby, insofar as such liabilities shall be based 
on the arrangements or agreements made by it or on its behalf.

21.  Manufacture; Distribution; Sale.

     Consistent with the high quality and prestige of the Licensed Marks 
and products manufactured by, or under license from, Polo and its 
affiliates, Company undertakes, during the term hereof, diligently to 
manufacture and sell each and every Licensed Product listed in Schedule A, 
to use its commercially reasonable best efforts to create a demand therefor, 
supply such demand, and maintain adequate arrangements and facilities for 
the distribution of Licensed Products throughout the Territory.  As an 
essential part of its distribution program, Company agrees to maintain 
adequate inventories (consistent with good industry practice) of all such 
Licensed Products at a single distribution point to satisfy the requirements 
of its customers for a full line of such Licensed Products and to expedite 
the delivery thereof.  Company represents, warrants and covenants that it 
is or shall be, on or before December 31, 2000,  "Y2K" compliant, and 
acknowledges that any failure of its computer systems as a result of 
Company's failure to be Y2K compliant would, if such failure results in a 
material interruption or adverse impact on its ordinary business operations 
relating to Licensed Products, constitute a violation of Company's 
obligations hereunder.
<PAGE>

22.  Showroom; Samples.

     22.1.  Company shall maintain its showroom at 1271 Avenue of the 
Americas to present Licensed Products.  The showroom shall be updated by 
Company at its expense each season during the term hereof for market week, 
in accordance with plans approved by RLHC.
<PAGE>

     22.2.  Company shall provide, at no charge, samples for the RLHC New 
York showroom (as well as Company's showroom) and for advertising and 
editorials relating to Licensed Products.  All normal expenses with respect 
to shipping shall be the responsibility of Company.  All items will be 
inventoried by RLHC (although RLHC shall not be responsible for ordinary 
damage or loss of such samples) and, at RLHC's discretion, (i) held in 
storage for future use, (ii) sold at sample sales (in which case no royalty 
shall be payable by Company), or (iii) returned to Company at Company's 
expense.  In the event of sale at a sample sale, RLHC shall deduct from 
total revenues from the sale of Licensed Products the costs of such sale, 
and shall remit to Company, within forty-five (45) days thereof, fifty 
percent (50%) of the remaining balance.  In addition, Company shall supply 
at its own expense, such samples as may be reasonably necessary for RLHC 
salesmen.

23.  Miscellaneous.

     23.1.  All notices, requests, consents and other communications 
hereunder shall be in writing and shall be deemed to have been properly 
given or sent (i) on the date when such notice, request, consent or 
communication is personally delivered and acknowledged, or (ii) five (5) 
days after the same was sent, if sent by certified or registered mail, or 
(iii) one (1) day after the same was sent, if sent by overnight courier 
delivery or confirmed telecopier as follows:

(a)  If to RLHC addressed as follows:

Ralph Lauren Home Collection, Inc.
103 Foulk Road
Suite 201
Wilmington, Delaware 19803
Attention: President
Telecopier: 302.778.1008
<PAGE>

(b)  With a copy to Polo and PRLC, addressed as follows:

Victor Cohen, Esq.
650 Madison Avenue
New York, New York 10022
Attention:  Victor Cohen, Esq.
Telecopier: 212.318.7183

(c)  If to Company, addressed as follows:

Pillowtex Corporation
4111 Mint Way
Dallas, Texas 75237
Attention:  Mr. Kevin Finlay
Telecopier: 214.330.8901

with a copy to:

Pillowtex Corporation
4111 Mint Way
Dallas, Texas 75237
Attention: General Counsel
Telecopier: 214.467.0823

Anyone entitled to notice hereunder may change the address to which notices 
or other communications are to be sent to it by notice given in the manner 
contemplated hereby.

     23.2.  Nothing herein contained shall be construed to place Company, 
RLHC, Polo and/or PRLC in the relationship of partners or joint venturers, 
and neither Company, RLHC, Polo nor PRLC shall have the power to obligate 
or bind any other party in any manner whatsoever, except as expressly 
provided herein.

     23.3.  None of the terms hereof can be waived or modified except by 
an express agreement in writing signed by the party to be charged.  The 
failure of either party hereto to enforce, or the delay by either party in 
enforcing, any of its rights hereunder shall not be deemed a continuing 
waiver, modification hereof, or a waiver of any other right or remedy 
hereunder, and either party may, within the time provided by applicable law, 
commence appropriate legal proceedings to enforce any and all such rights. 
All rights and remedies provided for herein shall be cumulative and in 
addition to any other rights or remedies such parties may have at law or in 
equity.  Either party hereto may employ any of the remedies available to it 
with respect to any of its rights hereunder without prejudice to the use by 
it in the future of any other remedy with respect to any such rights.  
Except as provided herein, no person, firm or corporation, other than the 
parties hereto, shall be deemed to have acquired any rights by reason of 
anything contained in this Agreement.
<PAGE>

     23.4.  Each of RLHC and PRLC may assign all or any portion of the 
respective royalties payable to it hereunder, and may assign all of its 
rights, duties and obligations hereunder to any entity to which the 
Trademarks, or the right to use the Trademarks, has been transferred, or to 
an affiliate of any such entity. The rights granted to Company are personal 
in nature, and neither this Agreement nor the sublicense may be assigned by 
Company without the prior written consent of RLHC, Polo and PRLC.  Company 
may employ subcontractors for the manufacture of the Licensed Products with 
the prior approval of RLHC, provided, however, that (i) Company shall not 
employ any subcontractor for the manufacture of Licensed Products until such 
subcontractor has executed a Trademark and Design Protection Agreement 
substantially in the form annexed hereto as Schedule B, (ii) Company shall 
maintain appropriate quality controls and comply with the quality 
requirements set forth herein, (iii)  such subcontractors shall comply with 
the Operating Guidelines annexed hereto as Schedule C and made a part 
hereof, as such Operating Guidelines may be amended from time-to-time, (iv) 
Company shall not itself sell or otherwise dispose of, and shall be 
responsible for preventing all subcontractors from selling or otherwise 
disposing of, any seconds, irregulars or rejected merchandise except with 
RLHC's prior written consent, (v) Company shall, in seeking RLHC's approval, 
give RLHC prior written notice of the full name and address of each 
subcontractor it proposes to use in connection with the manufacture of 
Licensed Products, together with a complete list of Licensed Products 
(and/or components thereof) to be manufactured by such subcontractor, and 
Company shall, upon RLHC's request no more than once annually (and in any 
event upon the expiration or termination of the term hereof), provide RLHC 
with a complete list of all such subcontractors containing all such 
information); (vi) Company, upon request from RLHC, shall cease placing 
orders with any such subcontractor; and (vii) Company shall give RLHC notice 
as required herein, but RLHC?s prior approval shall not be required, with 
respect to any subcontractor which, directly or indirectly, is wholly-owned 
by Company.

     23.5.  This Agreement shall be binding upon and inure to the benefit 
of the successors and permitted assigns of the parties hereto.

     23.6.  Company shall comply with all laws, rules, regulations and 
requirements of any governmental body which may be applicable to the 
operations of Company contemplated hereby, including, without limitation, 
as they relate to the manufacture, distribution, sale or promotion of 
Licensed Products, notwithstanding the fact that RLHC may have approved such 
item or conduct.

     23.7.  This Agreement shall be construed in accordance with the laws 
of the State of New York applicable to contracts made and performed therein 
without regard to principles of conflict of laws.
<PAGE>

     23.8  The parties hereby consent to the jurisdiction of the United 
States District Court for the Southern District of New York and of any of 
the courts of the Southern District of New York and of any of the courts of 
the State of New York located within the Southern District in any dispute 
arising under this Agreement and agree further that service of process or 
notice in any such action, suit or proceeding shall be effective if in 
writing and delivered as provided in paragraph 23.1 hereof.  Notwithstanding 
anything to the contrary set forth herein, neither Polo Ralph Lauren 
Corporation nor any other general or limited partner of Polo or PRLC shall 
be liable for any claim based on, arising out of, or otherwise in respect 
of, this Agreement, and Company shall not have nor claim to have any 
recourse for any such claim against any general or limited partner of Polo 
or PRLC.

     23.9.  This Agreement contains the entire and only agreement between 
the parties hereto concerning the subject matter hereof, and any oral 
statements or representations or prior written matter with respect thereto 
not contained herein shall have no force and effect, with the express 
exception of that certain letter agreement dated October 31, 1997 between 
Company and RLHC, the provisions of which shall, as set forth in paragraph 
2.11 hereof, continue to apply throughout the term.  The provisions of this 
Agreement are severable, and if any provision shall be held invalid or 
unenforceable in whole or in part in any jurisdiction, then such invalidity 
or unenforceability shall affect only such provision, or part thereof, in 
such jurisdiction and shall not in any manner affect such provision in this 
Agreement in any other jurisdiction.

     23.10.  The paragraph headings contained in this Agreement are for 
reference purposes only and shall not affect in any way the meaning or 
interpretation of this Agreement.

     23.11.  This Agreement may be executed in one or more counterparts, 
each of which shall be deemed an original, but all of which together shall 
constitute one and the same instrument.
<PAGE>

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement 
or caused the same to be executed by a duly authorized officer on the day 
and year first set forth above.

RALPH LAUREN HOME COLLECTION, INC.      PILLOWTEX CORPORATION

By: [Signature Illegible]               By: Kevin M. Finlay 



POLO RALPH LAUREN CORPORATION

By: [Signature Illegible] 




<PAGE>

                                   SCHEDULE A

                                   "LICENSED PRODUCTS"

                              (pursuant to paragraph 1.1)

The following decorative accessories (excluding those matched to sheets 
made under license from RLHC, Polo or Ralph Lauren, and excluding 
children?s bedding):

(a)  bed covers
(b)  bed and throw blankets of jacquard and other materials
(c)  duvet and comforter covers
(d)  shams and bedskirts, European squares
(e)  dust ruffles
(f)  bed spreads
(g)  comforters and blanket covers
(h)  down comforters
(i)  decorative and bed pillows
(j)  quilts;
(k)  night spreads
(l)  curtains, valances and draperies that coordinate with other 
    Licensed Products manufactured by Company 
(m)  shower curtains that coordinate with other Licensed Products 
    manufactured by Company
(n) bed pillows
(o) mattress pads
(p)  bath rugs up to 30" X 60" in size and small accent rugs; 
    provided, however, that Company?s rights with respect to 
    small accent rugs shall be non-exclusive and may be 
    terminated by RLHC upon ninety (90) days notice, it being 
    understood that any such termination shall not prohibit 
    Company from fulfilling orders for approved Licensed Products 
    Company had taken, in accordance with the terms of this 
    Agreement, prior to receiving notice of termination.


<PAGE>

                           Schedule B

               TRADEMARK AND DESIGN PROTECTION AGREEMENT

                                Re:  Orders for Polo/Ralph Lauren Merchandise

TO _____________________:

Our company may be entering into Purchase Order Contracts for 
samples and various products with you in the near future and would like 
to take this opportunity to call to your attention the basis upon which 
we will enter such agreements.

Pursuant to our agreements we may be providing you with certain 
designs and art work and requisitions for finished products (including 
samples), packaging, and business materials, among other things.  By 
accepting our orders or contracts, your company will have agreed that it 
has only a limited, non-transferable right to use any trademarks and/or 
designs and/or art work (including specifically, colors, shapes, and 
textures) of Ralph Lauren Home Collection, Inc. and its affiliates 
("Polo") as necessary for merchandise shipped or services rendered under 
our orders or contracts.  You agree that such trademarks, designs, logos 
and art work shall not be used by your firm at any time, whether or not 
they are used in conjunction with the Ralph Lauren name or trademarks, 
for any purpose other than that for which they were placed in your trust, 
i.e. in fulfillment of specific purchase orders, and you shall exercise 
due diligence so that they are not made available to third parties.  No 
rights shall remain in your firm or its employees or agents as to such 
trademarks, logos, art work, or designs of Polo and its affiliates and 
you agree that to the extent your firm may acquire any rights to said 
marks, logos, art work or designs, such rights shall revert to Polo or 
its affiliates, as the case may be, without any further act of the 
parties hereunder.  By accepting our orders, you hereby agree to 
indemnify Polo and its affiliates for any losses, costs or expenses (of 
any kind whatsoever) which may arise as a result, directly or indirectly, 
of a breach of this Agreement.

Please place the acknowledgment signature of two (2) of your 
executive officers in the space provided below and return one signed copy 
of this letter to the undersigned as soon as possible.

Thank you for your cooperation.

Sincerely yours,
Ralph Lauren Home Collection, Inc.


By: ___________________________

We have read and accept and agree to the above in consideration of orders 
from Ralph Lauren Home Collection, Inc.

CONTRACTOR NAME:  __________________________

By: (1) ____________________ and (2) ________________________
          Name:                                 Name:

Date:   ________________
<PAGE>


                             Schedule C

                         OPERATING GUIDELINES

Polo Ralph Lauren (the "Company") is dedicated to conducting its 
operations throughout the world on principles of ethical business 
practice and recognition of the dignity of workers.  We expect our 
business partners to respect and adhere to the same standards in the 
operation of their business, and we will utilize these criteria to 
evaluate our relationships with customers and suppliers.

WAGES / BENEFITS / WORKING HOURS.  Our business partners must comply with 
all laws regulating local wages, work hours and benefits.  Wage and 
benefit policies must be consistent with prevailing national standards, 
and also be acceptable under a broader international understanding as to 
the basic needs of workers and their families. We will not work with 
companies whose wage structure violates local law  or prevailing industry 
practice.

CHILD LABOR.  Our business partners must not use child labor, defined as 
school age children.  Our business partners will not employ workers under 
the age of 14.  This provision extends to all partner facilities.
 
HEALTH & SAFETY.  Our business partners must ensure that their workers 
are provided a safe and healthy work environment, and are not subject to 
unsanitary or hazardous conditions.

FREEDOM OF ASSOCIATION.  Our business partners should respect the legal 
rights of employees to freely and without harassment participate in 
worker organizations of their choice.

PRISON OR FORCED LABOR.  Our business partners will not work with or 
arrange for purchase of any materials from business partners who utilize 
prison or forced labor in any stage of the manufacture of our products.  

DISCIPLINARY PRACTICES.  Our business partners will not employ or conduct 
any business activity with partners who employ any form of physical or 
mental coercion or punishment against workers.

DISCRIMINATION.  Our business partners will not practice nor do business 
with business partners who practice any form of improper discrimination 
in hiring and employment, including on the basis of age, race, color, 
gender, or religion.

ENVIRONMENT.  Our business partners must embrace a fundamental concern 
for environmental protection and conduct their operations consistent with 
both local and internationally recognized environmental practices.

LEGAL REQUIREMENTS.  Our business relationship must be built on a mutual 
respect for and adherence to legal requirements. Our business partners 
will observe both local and applicable international standards.

ETHICAL STANDARDS.  We intend to conduct all our business in a manner 
consistent with the highest ethical standards, and we will seek and 
utilize partners who will do likewise, as this contributes directly to 
our corporate reputation and the collective success of our organization 
and selected business partners.

SUBCONTRACTING.  Our business partners may not subcontract all or any 
part of the work on our products without our express written consent, 
which will not be given unless each subcontractor meets all of the 
criteria set forth herein.

CONFLICTS OF INTEREST.  Our business partners may not give Company 
employees a gift of value in excess of US$25.00, and may not bribe 
foreign officials to benefit the Company or its business.

IMPLEMENTATION.  We will apply these criteria in all business partner 
determinations, and will continue to implement these policies in the 
conduct of all activities.  This will include our business partners 
sharing information on production facilities and procedures, with the 
objective of improving our collective service to customers in a 
responsible manner. Failure by a business partner to meet these 
standards, will result in our taking appropriate actions, up to and 
including cancellation of existing orders.