Exhibit 2.1(e)
                   THIRD AMENDMENT TO SECURITIZATION AGREEMENTS

     THIS THIRD AMENDMENT TO SECURITIZATION AGREEMENTS (this "Amendment"),  made
and entered  into as of March 31, 2000 (the  "Effective  Date"),  by and between
CONE RECEIVABLES II LLC, a North Carolina limited liability  company  ("CRLLC"),
CONE MILLS  CORPORATION,  a North Carolina  corporation  ("Cone Mills";  each of
CRLLC and Cone Mills a "Company" and,  collectively,  the "Companies"),  REDWOOD
RECEIVABLES  CORPORATION,  a  Delaware  corporation  ("Redwood"),   and  GENERAL
ELECTRIC CAPITAL CORPORATION, a New York corporation ("GECC"), in its capacities
as Operating Agent and Collateral Agent.

                                W I T N E S E T H:

     WHEREAS, Cone Mills, any other Originators that are or may hereafter become
a party  thereto  and  CRLLC  are  parties  to a  certain  Receivables  Transfer
Agreement,  dated as of September  1, 1999 (as amended to the date  hereof,  the
"Transfer  Agreement";  capitalized  terms used herein and not otherwise defined
herein  shall have the  meanings  given  such  terms in Annex X to the  Transfer
Agreement as amended by this Amendment), whereby Cone Mills has agreed (and each
Subsidiary of Cone Mills which  thereafter  becomes an Originator will agree) to
sell,  contribute  or  otherwise  transfer  to CRLLC,  and  CRLLC has  agreed to
purchase or otherwise acquire from such Originators, all of the right, title and
interest of such Originators in the Receivables; and

     WHEREAS, CRLLC, as Seller, Redwood, as Purchaser,  Cone Mills, as Servicer,
and GECC, as Operating Agent and as Collateral  Agent,  are parties to a certain
Receivables  Purchasing and Servicing  Agreement,  dated as of September 1, 1999
(as amended to the date hereof, the "Purchase Agreement"; the Transfer Agreement
and the Purchase  Agreement,  collectively,  the  "Securitization  Agreements"),
whereby  Purchaser has agreed,  among other things,  to purchase from CRLLC from
time to time  the  Receivables  sold or  contributed  to CRLLC  pursuant  to the
Transfer Agreement; and

     WHEREAS,  the  Securitization  Agreements  were  amended  pursuant  to that
certain First  Amendment and Waiver to  Securitization  Agreements,  dated as of
November 16, 1999,  among the parties hereto,  and that certain Second Amendment
to  Securitization  Agreements,  dated as of January 28, 2000, among the parties
hereto; and

     WHEREAS,  Cone Mills has requested  that the  Securitization  Agreements be
further  amended in certain  respects  as set forth in this  Amendment,  and the
parties hereto are willing to agree to such amendments  subject to the terms and
conditions of this Amendment.

     NOW  THEREFORE,  in  consideration  of the  premises  and mutual  covenants
contained  herein,  and other good and valuable  consideration,  the receipt and
sufficiency  of which are  hereby  acknowledged,  the  parties  hereto  agree as
follows:
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     1.  Amendments  of  Securitization  Agreements.  Subject  to the  terms and
conditions of this Amendment, the Securitization  Agreements shall be amended as
follows:

     (a) The definition of the term "Applicable  Margin" set forth in Annex 3 to
the  Purchase  Agreement  shall be deleted  in its  entirety  and the  following
revised definition of such term shall be substituted in lieu thereof:

     "Applicable  Margin"  shall mean 2.0% as of the Third  Amendment  Effective
Date,  but the  Applicable  Margin  shall be subject to  adjustment  (upwards or
downwards) prospectively on a quarterly basis as determined by Cone Mills' Fixed
Charge Coverage Ratio (as defined in Annex G) for the Rolling Period (as defined
in Annex G) for the immediately preceding fiscal quarter of Cone Mills, with the
initial  adjustment  (if needed) to be effective on the fifth (5th) Business Day
after  the  Operating  Agent's  receipt  of  Cone  Mills'  quarterly   financial
statements  and  Compliance  Certificate  (as  defined in Annex G)  meeting  the
requirements  of paragraph (c) of Annex G for Cone Mills' fiscal  quarter ending
July 2, 2000 and with each succeeding  adjustment (if needed) to be effective on
the fifth (5th) Business Day after  Operating  Agent's receipt of such quarterly
financial  statements  and Compliance  Certificate  for each  succeeding  fiscal
quarter of Cone Mills.  Each quarterly  adjustment in the Applicable Margin will
be determined by reference to the Fixed Charge  Coverage Ratio of Cone Mills and
its Subsidiaries for the Rolling Period ending with such fiscal quarter as shown
in such financial statements and Compliance Certificate as follows:

If such Fixed Charge                                       Then the Applicable
Coverage Ratio is:                                           Margin will be:

greater than or equal to 1.0:1.0                                   0.50%
greater than or equal to 0.75:1.0 but less than 1.0:1.0            1.00%
greater than or equal to 0.50:1.0 but less than 0.75:1.0           1.50%
greater than or equal to 0.31:1.0 but less than 0.50:1.0           2.00%
less than 0.31:1.0                                                 2.50%

     If the Operating Agent does not receive  delivery of Cone Mills'  quarterly
financial statements and Compliance Certificate for any fiscal quarter ending on
or after  October 3, 1999 in  accordance  with and by the deadline  specified in
Annex 5.02(a),  such failure shall (in addition to any other remedy  provided in
the Related  Documents)  result in an increase in the  Applicable  Margin to the
highest rate  specified  above until the fifth (5th)  Business Day following the
date on which  the  Operating  Agent  receives  such  financial  statements  and
Certificate  of  Compliance  (at which time such  adjustment  in the  Applicable
Margin shall become effective).  If a Termination Event or Incipient Termination
Event shall have occurred and be continuing at any time, the  Applicable  Margin
may, in the Purchaser's  discretion,  be increased to the highest rate specified
above  until  the  fifth  (5th)  Business  Day  after  the  date on  which  such
Termination Event or Incipient  Termination Event is waived,  cured or otherwise
ceases to exist.
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     (b) Annex G to the Purchase  Agreement shall be deleted in its entirety and
the revised  Annex G attached to this  Amendment  shall be  substituted  in lieu
thereof.

     (c) Annex X to the  Securitization  Agreements  shall be further amended by
adding the following new definition thereto:

     "Third Amendment Effective Date" shall mean March 31, 2000.

     (d) Annex X to the  Securitization  Agreements  shall be further amended by
deleting  therefrom the definition of the term "Fee Letter" and by  substituting
the following new definition of such term in lieu thereof:

        "Fee Letter" shall mean that certain letter  agreement dated March 31,
2000 among the Seller, Cone Mills and the Purchaser.

     2. No Other Amendments.  Except for the amendments  expressly set forth and
referred  to in Section 1 above,  the  Securitization  Agreements  shall  remain
unchanged and in full force and effect.

     3.  Representations  and  Warranties.  Each Company  hereby  represents and
warrants to Redwood,  the Operating Agent and the Collateral Agent that (a) this
Amendment has been duly authorized,  executed and delivered by each Company, (b)
after  giving  effect  to  this  Amendment,   no  Termination  Event,  Incipient
Termination  Event,   Event  of  Servicer   Termination  or  Incipient  Servicer
Termination Event has occurred and is continuing as of this date, and (c) all of
the  representations  and warranties made by each Company in the  Securitization
Agreements  are true and correct in all material  respects on and as of the date
of this  Amendment  (except  to the  extent  that  any such  representations  or
warranties  expressly  referred  to a specific  prior  date).  Any breach in any
material respect by either Company of any of its  representations and warranties
contained  in this  Section  3 shall  be a  Termination  Event  and an  Event of
Servicer Termination for all purposes of the Securitization Agreements.

     4. Ratification.  Each Company hereby ratifies and reaffirms each and every
term, covenant and condition set forth in the Securitization  Agreements and all
other  documents  delivered by such Company in connection  therewith  (including
without  limitation  the other  Related  Documents  to which  each  Company is a
party), effective as of the date hereof.

     5. Waiver by the Seller and Cone  Mills.  Each of the Seller and Cone Mills
hereby waives any claim,  defense,  demand, action or suit of any kind or nature
whatsoever  against the Purchaser,  the Operating Agent or the Collateral  Agent
arising  on or  prior  to  the  date  hereof  in  connection  with  any  of  the
Securitization Agreements or the transactions contemplated thereunder.
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     6. Conditions to Effectiveness. This Amendment shall become effective, upon
the Effective Date,  subject to the satisfaction of the following  conditions on
or prior to such date: (a) the receipt by the Operating Agent of this Amendment,
duly executed,  completed and delivered by each of the Companies,  Redwood,  the
Collateral Agent and the Operating Agent; (b) the receipt by the Operating Agent
of all fees  and  expenses  payable  to  Redwood,  the  Collateral  Agent or the
Operating  Agent,  respectively,  in connection  with this  Amendment  including
without  limitation the reasonable legal fees and other reasonable out of pocket
expenses of Redwood,  the  Collateral  Agent or the Operating  Agent incurred in
connection  with this  Amendment;  and (c) the receipt by the Operating Agent of
the amendment fee due in connection with this Amendment under the Fee Letter.

     7.  Reimbursement  of Expenses.  Each Company  hereby  agrees that it shall
reimburse  Redwood,  the Collateral  Agent and the Operating Agent on demand for
all  reasonable  costs and expenses  (including  without  limitation  reasonable
attorney's  fees) incurred by such parties in connection  with the  negotiation,
documentation  and  consummation  of  this  Amendment  and the  other  documents
executed in connection herewith and therewith and the transactions  contemplated
hereby and thereby.

     8.  Governing  Law. THIS  AGREEMENT  SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK FOR CONTRACTS TO BE PERFORMED
ENTIRELY WITHIN SAID STATE.

     9.  Severability  of Provisions.  Any provision of this Amendment  which is
prohibited or unenforceable in any jurisdiction  shall, as to such jurisdiction,
be ineffective to the extent of such  prohibition  or  unenforceability  without
invalidating  the  remaining  provisions  hereof or  affecting  the  validity or
enforceability  of such  provision  in any  other  jurisdiction.  To the  extent
permitted by  Applicable  Law,  each Company  hereby waives any provision of law
that renders any provision hereof prohibited or unenforceable in any respect.

     10.  Counterparts.  This Amendment may be executed in any number of several
counterparts,  all of which shall be deemed to  constitute  but one original and
shall be binding upon all parties, their successors and permitted assigns.

     11.  Entire  Agreement.  The  Securitization  Agreements as amended by this
Amendment embody the entire agreement between the parties hereto relating to the
subject matter hereof and supersede all prior  agreements,  representations  and
understandings, if any, relating to the subject matter hereof.

     12.  Cone  Mills'  and  GECC's  Capacities.  Cone  Mills is  executing  and
delivering  this  Amendment  both in its  capacity  as an  Originator  under the
Transfer  Agreement  and as the Servicer  under the Purchase  Agreement  and all
references  herein to "Cone  Mills"  shall be deemed to  include it in both such
capacities  unless  otherwise  expressly   indicated.   GECC  is  executing  and
delivering  this  Amendment  both in its  capacity  as the  Operating  Agent for
Redwood  and as the  Collateral  Agent for  Redwood  and the  Purchaser  Secured
Parties,  and all  references  herein to "GECC" shall be deemed to include it in
both such capacities unless otherwise expressly  indicated.
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     IN WITNESS  WHEREOF,  the parties  have caused  this  Amendment  to be duly
executed by their respective officers thereunto duly authorized,  as of the date
first above written.

                                             CONE RECEIVABLES II LLC
                                             By    /s/ Samir M. Gabriel
                                             Name: Samir M. Gabriel
                                             Title: President


                                             REDWOOD RECEIVABLES CORPORATION
                                             By:  /s/Joe Wiles
                                             Name:  Joe Wiles
                                             Title: Assistant Secretary



                                             CONE MILLS CORPORATION, as an
                                                Originator and as Servicer
                                             By:  /s/ Gary L. Smith
                                             Name:  Gary L. Smith
                                             Title:  EVP and CFO



                                             GENERAL ELECTRIC CAPITAL
                                                CORPORATION as Operating Agent
                                                and as Collateral Agent
                                             By:  /s/ Craig Winslow
                                             Name:  Craig Winslow
                                             Duly Authorized Signatory
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