CONE MILLS CORPORATION SERP

                (As Amended and Restated Effective June 30, 2001)


                                    RECITALS


         WHEREAS, Cone Mills Corporation (the "Corporation") has heretofore
adopted the Employees' Retirement Plan of Cone Mills Corporation (the "Basic
Plan"); and

         WHEREAS, effective from and after January 1, 1989, Section 401(a)(17)
of the Internal Revenue Code of 1986, as amended (the "Code"), limits the annual
compensation that may be taken into account under the Basic Plan for each
employee (such limitation, as in effect from and after January 1, 1989, to the
date hereof is hereinafter referred to as the "Compensation Limitation"); and

         WHEREAS, by plan document dated as of February 23, 1989, the
Corporation adopted the Cone Mills Corporation SERP (the "Plan") so that certain
executives of Cone Mills Corporation retiring under the Basic Plan (and their
beneficiaries) would receive retirement benefits under the Plan that, when
aggregated with the retirement benefits payable under the Basic Plan, would
equal those benefits that would have been payable under the Basic Plan if the
Compensation Limitation did not apply to the Basic Plan; and

         WHEREAS, on December 5, 1995, the Board of Directors of the Corporation
approved an amendment to the Plan pursuant to which executives who terminate
employment on or after January 1, 1996, with ten or more Years of Service under
the Basic Plan but who do not qualify for Retirement under Section 4 thereof
will be eligible to participate in the Plan; and

         WHEREAS, on June 11, 2001, the Board of Directors of the Corporation
(a) approved amendments to the Plan pursuant to which (i) executives who
terminate employment after June 30, 2001, with five or more Years of Service
under the Basic Plan but who do not qualify for Retirement under Section 4
thereof are eligible to participate in the Plan and (ii) certain lump-sum
payments from the Plan are authorized, (b) terminated the Plan effective June
30, 2001, so that no benefits will accrue under the Plan after June 30, 2001 and
(c) determined that, in calculating any SERP Benefit hereunder, the 18 months of
additional Accredited Service given to certain participants in the Basic Plan as
of June 30, 2001, shall be disregarded;

         NOW, THEREFORE, the Corporation hereby amends and restates the Plan as
follows to incorporate the amendments approved by the Board of Directors on June
11, 2001, and to reflect the termination of the Plan as of June 30, 2001:

        1. Name of Plan. As amended and restated herein, the Plan shall continue
to be known as the Cone Mills Corporation SERP.



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        2. Purpose of Plan. The purpose of this Plan is to provide the
participants herein with retirement benefits that, when aggregated with the
retirement benefits payable under the Basic Plan, will provide total benefits
equal to those that would be payable under the Basic Plan if the Basic Plan
terminated on June 30, 2001, and if the Compensation Limitation did not apply to
the Basic Plan. The Plan is intended to be a plan which is unfunded and
maintained primarily for the purpose of providing deferred compensation for a
select group of management or highly compensated employees and, as such, exempt
from the participation and vesting, funding, and fiduciary responsibility
provisions of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), by reason of Sections 201(2), 301(a)(3), and 401(a)(1) thereof.

        3. Definitions. All capitalized terms used herein that are defined in
the Basic Plan and not otherwise defined herein shall have the meaning specified
in the Basic Plan, except that, for purposes of this Plan, Offset Value (as
defined in the Basic Plan) shall be disregarded in determining a Member's
Accrued Benefit under the Basic Plan, and Beneficiary shall include a Member's
Spouse if the Spouse is entitled to receive benefits pursuant to Section 8 of
the Basic Plan after the Member's death.

        4. Participation. Subject to paragraph 7 below, if any Member of the
Basic Plan has retired or shall retire from any of the Companies in accordance
with Section 4 of the Basic Plan or shall die while an active Member in the
Basic Plan or shall otherwise terminate employment after completing five or more
Years of Service but without qualifying for Retirement under Section 4 of the
Basic Plan, and if the Compensation Limitation would reduce the benefits
otherwise payable under the Basic Plan to such Member and/or his Beneficiary
(determined without regard to any limitations imposed by Section 415 of the
Code) if the Basic Plan terminated on June 30, 2001, such Member and/or his
Beneficiary shall be entitled to participate in this Plan. No Member or his
Beneficiary shall be entitled to benefits hereunder unless such Member (a) has
retired and qualified for Normal Retirement, Early Retirement, or Postponed
Retirement under Section 4 of the Basic Plan or (b) has died while an active
Member in the Basic Plan and qualified for death benefits under Section 8
thereof or (c) has otherwise terminated employment after June 30, 2001, with
five or more Years of Service but without qualifying for Retirement under
Section 4 of the Basic Plan.

        5. SERP Benefit.

           (a) Subject to subparagraphs (d) and (e) below, any Member who is
        entitled to participate in this Plan in accordance with paragraph 4
        above, and the Beneficiary of any such Member, shall be entitled to a
        monthly benefit, payable by the Corporation, at the same time and in the
        same manner as the monthly benefit payable to such Member or his
        Beneficiary under the Basic Plan, in an amount equal to the excess of:

               (i) The amount of the monthly benefit (determined without regard
           to any limitations imposed by Section 415 of the Code) that
           would be payable to such Member or his Beneficiary under the
           Basic Plan if (y) the Basic Plan had terminated on June 30,
           2001 and (ii) the Compensation Limitation had not applied to
           the Basic Plan (except that Section 7.04 of the Basic Plan
           shall be disregarded in determining the amount of the monthly
           benefit that would be payable to the Member or his
           Beneficiary); over

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               (ii) The amount of the monthly benefit that would be payable to
           such Member or his Beneficiary under the Basic Plan if it had
           terminated on June 30, 2001, after applying the Compensation
           Limitation and after giving effect to Section 7.04 of the
           Basic Plan (but without regard to any limitations imposed by
           Section 415 of the Code).

           (b) In the case of a death benefit under the Basic Plan that is
        converted to a lump sum payment, the excess benefit payable to the
        Beneficiary under this Plan shall be a lump sum payment determined by
        applying the Basic Plan rules and calculating a lump sum death benefit
        under the Basic Plan as if the Basic Plan terminated on June 30, 2001,
        and the Compensation Limitation had not applied (and without regard to
        any limitations imposed by Section 415 of the Code) and subtracting
        therefrom the amount of the lump sum death benefit that would be payable
        under the Basic Plan if it had terminated on June 30, 2001, after
        applying the Compensation Limitation (but without regard to any
        limitations imposed by Section 415 of the Code).

           (c) Notwithstanding the foregoing, if amounts paid to any Member or
        his Beneficiary under the Basic Plan and the Corporation's 1983 ESOP are
        less than the Accrued Benefit (or Actuarial Equivalent thereof) of the
        Member under the Basic Plan, then any amounts otherwise payable in
        accordance with this paragraph 5 to any Member and/or his Beneficiary
        under this Plan shall be paid in the same proportion as the benefits
        payable under the Basic Plan and the Corporation's 1983 ESOP to such
        Member or Beneficiary bear to the Accrued Benefit (or Actuarial
        Equivalent thereof) of the Member or Beneficiary under the Basic Plan.

           (d) In its sole discretion, using such reasonable actuarial
        assumptions as it deems appropriate, the Corporation may convert the
        SERP Benefit of any Member to a lump sum and, upon payment of the lump
        sum to the Member, the Corporation shall have no further obligation to
        the Member or the Member's Beneficiary under this Plan. In no event will
        lump sum payments to any Member under this paragraph 5(d) and under
        paragraph 5(d) of the Cone Mills Corporation Excess Benefit Plan exceed
        $10,000 in the aggregate.

           (e) Under Section 1.01 of the Basic Plan, certain Members were given
        18 months of additional Accredited Service as of June 30, 2001. In
        determining the SERP Benefit payable to any such Member or his
        Beneficiary under this paragraph 5, the 18 months of additional
        Accredited Service given as of June 30, 2001, shall be disregarded and
        excluded from all calculations.

        6. Determinations by Corporation; Amendment. Any determination in good
faith by the Corporation, including any determination by the Pension Committee
under the Basic Plan, as to the amount of benefits payable hereunder to any
Member or Beneficiary shall be final and binding for purposes of this Plan. In
addition, the Corporation may from time to time amend this Plan for the purpose
of carrying out the intent of the Board of Directors of the Corporation.

        7. Forfeiture of Benefits.

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           (a) If a Member's employment with any of the Companies is terminated
        for cause or if he is retired for cause, then neither the Member nor his
        Beneficiary shall be entitled to receive benefits under this Plan. For
        purposes of this paragraph 7(a), termination for cause shall mean (i)
        termination due to the Member's committing fraud, misappropriation or
        embezzlement in the performance of his duties as an employee or (ii)
        termination due to the Member's committing any felony for which he is
        convicted and which, as determined in good faith by the Board of
        Directors of the Corporation, constitutes a crime involving moral
        turpitude and results in material harm to the Corporation.

           (b) If at any time while benefits are payable under this Plan, a
        Member entitled to such benefits shall, directly or indirectly, own any
        interest in, manage, operate, control, be employed by, render advisory
        services to, represent, or participate in or be connected with the
        management or control of, any business which is then in competition with
        the Corporation or any of its subsidiaries, the Corporation shall have
        the right to terminate payment of any benefits that would otherwise be
        payable hereunder to such Member or his Beneficiary from and after the
        date of such Member's violation of the conditions of this paragraph
        7(b); provided, however, that any Member may own, directly or
        indirectly, solely as an investment, securities of any corporation
        traded on a national securities exchange if such Member is not
        a controlling person of, or a member of a group which controls, such
        corporation, does not, directly or indirectly, own more than one percent
        of any class of securities of such corporation and does not otherwise
        violate the conditions of this paragraph 7(b). The Board of Directors
        may waive in writing the Corporation's right to terminate payment of
        benefits under this Plan in the event of a violation of this paragraph
        7(b).

        8. No Funding of Plan. This Plan shall be "unfunded" within the meaning
of ERISA. All benefits payable hereunder shall be paid by the Corporation out of
its general assets. To the extent that any Member or Beneficiary acquires the
right to receive payments from the Corporation hereunder, such right shall be no
greater than the right of any unsecured general creditor of the Corporation. The
Corporation shall have no obligation to establish any fund or to purchase any
annuity or other contract to provide the amounts payable hereunder, and, except
as otherwise expressly provided by written instrument, if any such fund is
established or any such contract purchased, it shall be the sole property of the
Corporation and no Member or Beneficiary shall have any rights therein.

        9. No Assignment. No right or benefit under this Plan shall be subject
to anticipation, alienation, sale, assignment, pledge, encumbrance, or charge by
any Member or his Beneficiary, and any attempt to anticipate, alienate, sell,
assign, pledge, encumber, or charge any right or benefit under this Plan shall
be void.

        10. Binding Effect. This Plan shall constitute a binding obligation of
the Corporation and its successors and assigns to each Member and Beneficiary
entitled to benefits in accordance with the terms and conditions hereof. As used
herein, the term "successor" shall include any person, firm, corporation or
other business entity that, whether by merger, purchase or otherwise, acquires
all or substantially all of the assets or business of the Corporation. This Plan
has been adopted by the Corporation in consideration of past and anticipated
future services of its employees.



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        11. Construction. This Plan shall be governed by and construed in
accordance with the laws and judicial decisions of the State of North Carolina.
As used herein, the masculine gender shall include the feminine, as
appropriate.

        12. Coordination. This Plan shall be coordinated with the Excess Benefit
Plan of Cone Mills Corporation so that, subject to subparagraphs 5(d) and 5(e),
the total retirement benefits payable to a Member or his Beneficiary under the
Basic Plan (with respect to his Accrued Benefit as of June 30, 2001), the Excess
Benefit Plan and this Plan equal the benefits that would have been payable to
such Member or Beneficiary under the Basic Plan if (i) the Basic Plan had
terminated on June 30, 2001, (ii) neither the Compensation Limitation nor any
limitations imposed by Section 415 of the Code had applied to the Basic Plan and
(iii) Section 7.04 of the Basic Plan were disregarded.

        IN WITNESS WHEREOF, the Corporation has caused this Amended and Restated
Plan to be executed on June 11, 2001.

                           CONE MILLS CORPORATION


                           By: /s/Neil W. Koonce
                                  Neil W. Koonce
                                  Vice President, General Counsel and Secretary