FORM 10-K                                    Page 228

Exhibit 10.3


                     EXCESS BENEFIT PLAN

                             OF

                   CONE MILLS CORPORATION

      (As Amended and Restated as of December 5, 1995)




                          RECITALS

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

     WHEREAS, Section 415 of the Internal Revenue Code of
1986, as amended (the "Code"), imposes certain limitations
(such limitations, as now existing and as hereafter modified
or amended from time to time, are hereinafter referred to as
the "Section 415 Limitations") on benefits payable under the
Basic Plan and under the other retirement plans of the
Corporation that are qualified under Section 401(a) of the
Code (the "Other Qualified Plans"); and

     WHEREAS, the Other Qualified Plans provide that, in the
case of an employee of the Corporation who is a participant in
both the Basic Plan and the Other Qualified Plans, the Section
415 Limitations shall be applied first to the Basic Plan so
that any required reduction in benefit accruals will occur in
the Basic Plan and not in the Other Qualified Plans; and

     WHEREAS, by plan document dated as of August 2, 1983, the
Corporation established the Supplemental Executive Retirement
Plan of Cone Mills Corporation (hereinafter the "Supplemental
Executive Plan") so that certain executives of Cone Mills
Corporation retiring under the Basic Plan (and their
beneficiaries) would receive retirement benefits under the
Supplemental Executive 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 Section 415 Limitations did not apply to the Basic
Plan and the Other Qualified Plans; and




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FORM 10-K                                    Page 229

Exhibit 10.3   (continued)

     WHEREAS, by plan document dated as of February 23, 1989,
the Supplemental Executive Plan was amended and restated as
provided therein and was renamed the Excess Benefit Plan of
Cone Mills Corporation (the "Excess Benefit Plan"); and

     WHEREAS, on December 5, 1995, the Board of Directors of
the Corporation approved an amendment to the Excess Benefit
Plan pursuant to which executives who terminate employment on
or after January 1, 1996, with 10 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
Excess Benefit Plan; and

     WHEREAS, the Corporation desires to amend and restate the
Excess Benefit Plan as of December 5, 1995.

     NOW, THEREFORE, the Corporation hereby adopts this
Amended and Restated Excess Benefit Plan, the terms and
conditions of which are as follows:

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

     2.   Purpose of Plan.  The purpose of this Excess Benefit
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 Section 415 Limitations did not apply to the Basic Plan
and the Other Qualified Plans.  The Plan is intended to be an
"excess benefit plan" within the meaning of Section 3(36) of
the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), and, as such, exempt from the provisions of
ERISA by reason of Section 4(b)(5) 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.




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FORM 10-K                                    Page 230

Exhibit 10.3   (continued)


     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 10 or
more Years of Service but without qualifying for Retirement
under Section 4 of the Basic Plan, and if the Section 415
Limitations applicable to the Basic Plan and the Other
Qualified Plans reduce the benefits otherwise payable under
the Basic Plan to such Member and/or his Beneficiary, such
Member and/or his Beneficiary shall be entitled to participate
in this Excess Benefit 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 on or after January
1, 1996, with 10 or more Years of Service but without
qualifying for Retirement under Section 4 of the Basic Plan.

     5.   Excess Benefit.  Any Member who is entitled to
participate in this Excess Benefit 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:

       (a)  The amount of the monthly benefit that
  would be payable to such Member or his Beneficiary
  under the Basic Plan if the Section 415 Limitations
  did not apply to the Basic Plan and the Other
  Qualified Plans (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

       (b)  The amount of the monthly benefit actually
  payable to such Member or his Beneficiary under the
  Basic Plan after applying the Section 415
  Limitations in accordance with the terms and
  provisions of the Basic Plan and the Other Qualified
  Plans (and after giving effect to Section 7.04 of
  the Basic Plan).




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FORM 10-K                                      Page 231

Exhibit 10.3   (continued)


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 Section
415 Limitations did not apply and subtracting therefrom the
amount of the lump sum death benefit payable under the Basic
Plan after applying the Section 415 Limitations.

  6.   Determinations by Corporation.  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.

  7.   Forfeiture of Benefits.

       (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 Excess Benefit 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 Excess Benefit 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 




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FORM 10-K                                      Page 232

Exhibit 10.3   (continued)


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.   Termination.

       (a)  The Corporation reserves the right to terminate
this Excess Benefit Plan at any time; provided, however, that
in the event of termination, each Member who had theretofore
retired under Section 4 of the Basic Plan or who had died
while an active Member in the Plan or who had otherwise
terminated employment with 10 or more Years of Service, and
the Beneficiary of each such Member, shall receive the
benefits provided hereunder and provided further that each
Member who is then eligible for Early Retirement, Normal
Retirement or Postponed Retirement under Section 4 of the
Basic Plan or who has then completed 10 or more Years of
Service shall have an accrued benefit under this Plan equal to
the excess of:

      (i)   The amount that his Accrued Benefit under
  the Basic Plan would have been if he had actually
  retired or, if not eligible for Retirement,
  voluntarily terminated employment on the date of
  termination of this Plan and if the Section 415
  Limitations did not apply to the Basic Plan and the
  Other Qualified Plans; over

      (ii)  The amount that his Accrued Benefit under
  the Basic Plan would have been, after applying the
  Section 415 Limitations in accordance with the
  terms and provisions of the Basic Plan and the
  Other Qualified Plans, if he had actually retired
  or, if not eligible for Retirement, voluntarily
  terminated employment on the date of termination of
  this Plan.

The accrued benefit of each such Member under this Plan (or
the Actuarial Equivalent thereof) shall be payable by the
Corporation to the Member and/or his Beneficiary at the same
time, in the same manner, and at the same rate or percentage,
as the retirement benefit payable to such Member 

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FORM 10-K                                       Page 233

Exhibit 10.3   (continued)

or his Beneficiary under the Basic Plan.  The accrued benefit
of a Member under this Plan upon its termination shall be
determined by independent actuaries retained by the
Corporation.

        (b)  This Excess Benefit Plan shall automatically
terminate upon any termination of the Basic Plan and the
provisions of paragraph 8(a) above shall apply; provided,
however, that 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 paragraph 8(a) above 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 and/or his
Beneficiary bear to the Accrued Benefit (or Actuarial
Equivalent thereof) of the Member or Beneficiary under the
Basic Plan.

        (c)  Members of the Basic Plan on the date of
termination of this Plan or the Basic Plan who are not then
eligible for Early Retirement, Normal Retirement or Postponed
Retirement under Section 4 of the Basic Plan or who have not
then completed 10 or more Years of Service shall have no
accrued benefit under this Excess Benefit Plan, and the
Corporation shall have no obligation hereunder to such Members
or their Beneficiaries.

   9.   No Funding of Plan.  This Excess Benefit Plan shall be
"unfunded" within the meaning of Section 4(b)(5) 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.






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FORM 10-K                                       Page 234

Exhibit 10.3   (continued)


   10.  No Assignment.  No right or benefit under this Excess
Benefit 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.

   11.  Binding Effect.  This Excess Benefit 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.

   12.  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.

   13.  Coordination.  This Excess Benefit Plan shall be
coordinated with the Cone Mills Corporation SERP so that the
total retirement benefits payable to a participant in the
Basic Plan, the SERP and this Plan equal the benefits that
would have been payable to such participant under the Basic
Plan if the Section 415 Limitations did not apply to the Basic
Plan and the Other Qualified Plans, if there were no
limitation on the amount of annual compensation taken into
account under the Basic Plan and if Section 7.04 of the Basic
Plan were disregarded.

   IN WITNESS WHEREOF, the Corporation has caused this Excess
Benefit Plan to be executed as of December 5, 1995.


                  CONE MILLS CORPORATION


                  By:   /s/ Terry L. Weatherford   
                  Title:  Vice President and Secretary