Document:

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Exhibit 10.36

                              EMPLOYMENT AGREEMENT

     This EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into as of
December 31, 2002 (the "Effective Date") by and between FAIRPOINT
COMMUNICATIONS, INC., a Delaware corporation (together with its successors and
assigns permitted hereunder, the "Company"), and EUGENE B. JOHNSON (the
"Executive").

                                    RECITALS:

     WHEREAS, the Executive is currently employed by the Company as its Chief
Executive Officer pursuant to an Employment Agreement dated January 1, 2002, for
a period ending March 31, 2003 (the "Existing Employment Agreement").

     WHEREAS, the Board of Directors of the Company (the "Board") has determined
that it is in the best interests of the Company and its subsidiaries and
stockholders to enter into this Agreement for purposes of extending the term of
Executive's employment for an additional three (3) years and nine (9) months,
providing additional responsibilities and benefits to Executive, entering into a
post-employment noncompetition agreement with Executive and otherwise employing
the Executive on the terms and conditions set forth herein.

     NOW, THEREFORE, in consideration of the respective agreements and covenants
set forth herein and other good and valuable consideration, the receipt of which
is hereby acknowledged, the parties hereto, intending to be legally bound,
hereby agree as follows:

     1. EMPLOYMENT PERIOD. Subject to Section 3, the Company hereby agrees to
employ the Executive, and the Executive hereby agrees to be employed by the
Company, as Chief Executive Officer of the Company and/or as Chairman of the
Board of Directors of the Company, in accordance with the terms and provisions
of this Agreement for a period commencing on the date hereof and ending on
December 31, 2006 (the "Employment Period"). In the event the Executive
continues to perform services after the Employment Period, and pending agreement
for extension of the Employment Agreement, such services shall constitute
employment for an unspecified term, terminable at will, with or without cause or
reason, with or without advance notice, and with or without pay in lieu of
advance notice.

     2. TERMS OF EMPLOYMENT.

        (a) POSITION AND DUTIES.

            (i) During the term of the Executive's employment, the Executive
shall serve as the Chief Executive Officer of the Company and/or as Chairman

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of the Board of Directors of the Company and, in so doing, shall perform normal
duties and responsibilities associated with such positions.

            (ii) During the term of the Executive's employment, and excluding
any periods of vacation and other leave to which the Executive is entitled, the
Executive agrees to devote substantially all his business time to the business
and affairs of the Company and to use the Executive's best efforts to perform
faithfully, effectively and efficiently his duties and responsibilities.

            (iii) Notwithstanding Section 2(a)(ii) hereof, during the term of
the Executive's employment it shall not be a violation of this Agreement for the
Executive to (1) serve on industry, trade, civic, educational or charitable
boards or committees, (2) deliver lectures or fulfill speaking engagements,
and/or (3) manage personal investments, so long as such activities do not
interfere with the performance of the Executive's duties and responsibilities as
an employee of the Company.

            (iv) Executive agrees to observe and comply with the Company's rules
and policies as adopted by the Company from time to time.

        (b) COMPENSATION.

            (i) BASE SALARY. During the term of the Executive's employment, the
Executive shall receive an annual base salary of $350,000 (the "Annual Base
Salary"), which shall be paid in accordance with the customary payroll practices
of the Company.

            (ii) BONUS. Executive shall be eligible for a bonus each year (up to
50% of Executive's Annual Base Salary), which bonus shall be paid if fully
earned, all as provided in an objective bonus arrangement set and documented by
the Company's Compensation Committee and Executive each year.

            (iii) INCENTIVE SAVINGS, STOCK OPTION AND RETIREMENT PLANS. During
the term of the Executive's employment, the Executive shall be entitled to
participate in all incentive, savings, stock option and retirement plans,
practices, policies and programs applicable generally to other senior executives
of the Company, as amended from time to time. Without limiting the foregoing,
Executive currently has 213,200 fully-vested options under the Company's 1995
Stock Option Plan (the "95 Plan"), 1,104,584 fully-vested options under the
Company's 1998 Stock Incentive Plan (the "98 Plan") and 27,033 fully-vested
options (25% of the March 12, 2002 Grant) under the Company's 2000 Employee
Stock Option Plan (the "2000 Plan"). The Executive also has been granted 298,750
options which are scheduled to vest on May 21, 2003 and 41,666 options which are
scheduled to vest ratably on January 31, 2003, February 28, 2003 and March 31,
2003, each of which were granted pursuant to the 98 Plan. The Executive has
further been granted 81,098 options pursuant to the 2000 Plan, which are
scheduled to vest ratably on April 1, 2003, April 1, 2004 and April 1, 2005.
Except as

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provided in Section 4 hereof, all options granted to Executive under the 98 Plan
and the 2000 Plan shall vest in accordance with the terms and conditions of the
agreements granting such options.

            (iv) WELFARE BENEFIT PLANS. During the term of the Executive's
employment, the Executive and/or the Executive's family, as the case may be,
shall be eligible for participation in and shall receive all benefits under the
welfare benefit plans, practices, policies and programs provided by the Company,
including medical, prescription, dental, disability, salary continuance,
employee life, group life, accidental death and travel accident insurance plans
and programs, as amended from time to time, to the extent applicable generally
to other employees of the Company. Notwithstanding the foregoing, the Company
shall pay (i) all health insurance premiums related to the Company's plans that
Executive or his spouse would otherwise be required to pay personally, and (ii)
all medical, prescription, dental and other health related bills of Executive
and his spouse not covered by the Company's health insurance plans. In addition,
the Executive shall be entitled to payment of long term disability and term life
insurance premiums in an amount not to exceed $10,000 in the aggregate annually.

            (v) PERQUISITES. During the term of the Executive's employment, the
Executive shall be entitled to receive, in addition to the benefits described
above, such perquisites and fringe benefits appertaining to his position in
accordance with any policies, practices and procedures established by the Board,
as amended from time to time, including, without limitation, reimbursement for
automobile (import luxury or equivalent) expenses.

            (vi) EXPENSES. During the term of the Executive's employment, the
Executive shall be entitled to receive prompt reimbursement for all reasonable
employment expenses incurred by the Executive in accordance with the Company's
policies, practices and procedures, as amended from time to time.

     3. TERMINATION OF EMPLOYMENT.

        (a) DEATH OR DISABILITY. The Executive's employment shall terminate
automatically upon the Executive's death during the Employment Period. If a
Disability (as defined below) of the Executive has occurred during the
Employment Period, the Company may give to the Executive written notice in
accordance with Section 8(e) hereof of its intention to terminate the
Executive's employment. In such event, the Executive's employment with the
Company shall terminate effective on the ninetieth (90th) day after receipt of
such notice by the Executive (the "Disability Effective Date"), if, within
ninety (90) days after such receipt, the Executive shall not have returned to
perform, with reasonable accommodation, the essential functions of his position.
For purposes of this Agreement, at any time the Company or any of its affiliates
sponsors a long-term disability plan for the Company's employees, "Disability"
shall mean disability as defined in such long-term disability plan. The
determination of whether the Executive has a Disability shall be made by the
person or persons required to render

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disability determinations under the long-term disability plan. At any time the
Company does not sponsor a long-term disability plan for its employees,
"Disability" shall mean the Executive's inability to perform, with reasonable
accommodation, the essential functions of his position hereunder for a period of
180 days in any 360 consecutive day period due to mental or physical incapacity,
as determined by a physician selected by the Company or its insurers.

        (b) CAUSE OR WITHOUT CAUSE. The Company may terminate the Executive's
employment during the Employment Period for Cause or without Cause. For purposes
of this Agreement, "Cause" shall mean (a) misappropriating any funds or any
material property of the Company, (b) obtaining or attempting to obtain any
material personal profit from any transaction in which the Executive has an
interest which is adverse to the interest of the Company unless the Company
shall first give its consent to such transaction, (c) (i) the willful taking of
actions which directly impair the Executive's ability to perform the duties
required by the terms of his employment, or (ii) taking any action detrimental
to the Company's goodwill or damaging to the Company's relationships with its
customers, suppliers or employees; provided that such neglect or refusal, action
or breach shall have continued for a period of twenty (20) days following
written notice thereof, (d) being convicted of or pleading NOLO CONTENDERE to
any crime or offense constituting a felony under applicable law or any crime or
offense involving fraud or moral turpitude, or (e) any material intentional
failure to comply with applicable laws or governmental regulations within the
scope of employment as defined by this Agreement. For purposes of this
Agreement, "without Cause" shall mean a termination by the Company of the
Executive's employment during the Employment Period for any reason other than a
termination based upon Cause, death or Disability.

        (c) NOTICE OF TERMINATION. Any termination by the Company for Cause or
without Cause shall be communicated by a Notice of Termination to the Executive
given in accordance with Section 8(e). For purposes of this Agreement, the term
"Notice of Termination" means a written notice which (i) indicates the specific
termination provision in this Agreement relied upon, (ii) to the extent
applicable, sets forth in reasonable detail the facts and circumstances claimed
to provide a basis for termination of the Executive's employment under the
provision so indicated, and (iii) if the Date of Termination (as defined below)
is other than the date of receipt of such notice, specifies the termination
date. The failure by the Company to set forth in the Notice of Termination any
fact or circumstance which contributes to a showing of Cause shall not waive any
right of the Company hereunder or preclude the Company from asserting such fact
or circumstance in enforcing the Company's rights hereunder.

        (d) DATE OF TERMINATION. The term "Date of Termination" means (i) if the
Executive's employment is terminated by the Company for Cause, the date of
receipt of the Notice of Termination or any later date specified therein
pursuant to Section 3(c), as the case may be, (ii) if the Executive's employment
is terminated by the Executive, thirty (30) days from the date of receipt of the
Notice of Termination, (iii) if the

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Executive's employment is terminated by the Company other than for Cause, the
date on which the Company notifies the Executive of such termination, and (iv)
if the Executive's employment is terminated by reason of death or Disability,
the date of death of the Executive or the Disability, as the case may be.

     4. OBLIGATIONS OF THE COMPANY UPON TERMINATION.

        (a) If, during the Employment Period, the Company shall terminate the
Executive's employment for Cause or the Executive shall voluntarily resign, the
Executive shall not be entitled to any future benefits pursuant to this
Agreement.

        (b) Upon the earliest of (A) expiration of the Employment Period, or (B)
termination of the Executive's employment as Chief Executive Officer and as
Chairman of the Board of Directors without Cause, the Executive shall be
entitled to receive from the Company the following, effective as of the date of
occurrence of such event (the "Termination Event"):

            (i) Title to two (2) permanent seat licenses with the Carolina
Panthers.

            (ii) Continued fully paid medical coverage (as provided in Section
2(b)(iv)) for Executive and Executive's spouse until each such person has
reached age sixty-five (65).

            (iii) Accelerated vesting of all options referred to herein granted
to Executive under the 98 Plan and the 2000 Plan, as of the date of the
Termination Event.

            (iv) Extension of the Executive's right to exercise all of his
vested options under the 95 Plan until the earlier of (a) May 21, 2008, or (b)
the Sale of the Company (as defined in the 98 Plan to mean the consummation of
either (i) a sale by THL (Thomas H. Lee Equity Fund IV, L.P. and the parties
listed on Schedule A to the Stockholders' Agreement dated as of January 20,
2000) and Kelso (collectively Kelso Investment Associates V, L.P. and Kelso
Equity Partners V, L.P.) of all the shares of the Company's Common Stock owned
by them to one or more third parties, or (ii) a sale of all or substantially all
of the Company's and its subsidiaries' assets).

            (v) Extension of the Executive's right to exercise all of his vested
options under the 2000 Plan until the earlier of (a) March 12, 2012, or (b) the
Sale of the Company (as above defined).

        (c) Upon the expiration of the Employment Period at December 31, 2006,
unless extended by the mutual agreement of the Company and Executive, the
Executive shall be entitled to receive, in accordance with the customary payroll
practices of the Company, payment of Executive's Base Salary as of the
Termination Event for one

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year following the Termination Event, subject to such payment being suspended
for a breach of the Executive's covenant not to compete set forth in Section 6
hereof. In addition, the Company shall maintain the Executive's long term
disability and term life insurance premiums (as provided in Section 2(b)(iv))
for such period.

        (d) In the event that the Executive's employment as Chief Executive
Officer of the Company and as Chairman of the Board of Directors of the Company
is terminated without Cause at any time during the Employment Period, the
Executive shall be entitled to receive, in accordance with the customary payroll
practices of the Company, payment of Executive's Base Salary as of the
Termination Event for two years following the Termination Event, subject to such
payment being suspended for a breach of the Executive's covenant not to compete
set forth in Section 6 hereof. In addition, the Company shall maintain the
Executive's long term disability and term life insurance premiums (as provided
in Section 2(b)(iv)) for such period.

     5. PROTECTION OF CONFIDENTIAL INFORMATION. Executive acknowledges that by
reason of his position with the Company, he has had and will continue to have
complete access to and knowledge of the Company's Confidential Information. The
Company's "Confidential Information", as used in this Agreement, means any form
of data or information in the possession or control of the Company which relates
to its business affairs, including but not limited to trade secrets, proprietary
information or other information not in the public domain. Confidential
Information includes but is not limited to product or service concepts and
designs, marketing insights, technology related to the Company's business,
business methods and strategies, all financial information and plans of the
Company, acquisition targets and potential targets, strategic business plans,
pricing terms and methods, growth, expansion or acquisition plans, financing or
venture capital sources and plans, and all similar information that the Company
holds in confidence or that competitors of the Company would be desirous of
obtaining. Executive agrees to use the Confidential Information only for the
purpose of or in connection with the business of the Company, and to keep the
Company's Confidential Information in strictest confidence and secrecy and not
to use or disclose Confidential Information to any person or entity except for
purposes of conducting the business of the Company, both during the term of
Executive's employment with the Company (both during the Employment Period and
any continuation period thereafter) and thereafter for a period of five (5)
years. Executive will return all Confidential Information to the Company
immediately upon termination of his employment with the Company.

     6. NON-COMPETITION.

        (a) NON-COMPETITION AGREEMENT. Executive agrees that, without the prior
written consent of the Company's Board of Directors, during the term of his
employment with the Company, including any continued employment after the
Employment Period, and for a period of two (2) years thereafter, he will not
"Compete" with the Company in the "Prohibited Territory."

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        (b) DEFINITION OF "COMPETE". For purposes of this Section 6, the term
"Compete" means to be employed or engaged in any capacity, whether as an
employee, as a consultant, or by self-employment, individually or on behalf of
others, or to have any ownership interest in, any business or entity engaged in
business in the "Telecommunications Industry"; provided, however, that the
purchase and ownership of capital stock of less than two percent (2%) in a
publicly traded entity within the Telecommunications Industry shall not
constitute competing. As used herein, the term "Telecommunications Industry"
shall have its broadest definition, as generally understood by the investing
public, and includes, but is not necessarily limited to the ownership,
acquisition or operation of, investment in, or the provision of services or
technology related to Rural Local Exchange Carriers (RLECs), Incumbent Local
Exchange Carriers (ILECs), Competitive Local Exchange Carriers (CLECs), Internet
Service Providers (ISPs), cable television services, retail or wholesale
distribution of long distance services, Internet portal services, web casting
and web hosting, dedicated service lines (DSL), broadband, voice or video
conferencing, voice mail services, voice, data or video transmissions, cellular
or wireless telephone, data, paging or Internet access services, prepaid calling
cards and other prepaid communication services, electronic mail services,
directory and operator assistance services, facsimile and data services, and
other similar and related services and products.

        (c) DEFINITION OF "PROHIBITED TERRITORY". For purposes of this Section
6, the term "Prohibited Territory" shall mean and include each of the following
defined areas: (i) the United States, and (ii) any State within the United
States where the Company is engaged in business in the Telecommunications
Industry. For purposes of this Section 6, a person or entity is considered to be
Competing in the Prohibited Territory if it is engaged in offering or providing
products or services related to the Telecommunications Industry within the
Prohibited Territory, regardless of the geographic location of the Competing
individual or entity.

        (d) ACKNOWLEDGMENTS BY EXECUTIVE. Executive acknowledges that the terms
of this Section 6, including the definitions of "Compete", "Telecommunications
Industry" and "Prohibited Territory", and the two (2) year post employment term
are reasonable, and are no broader than necessary to protect the Company's
legitimate business interests. Executive specifically acknowledges and agrees
that (i) he has received adequate and valuable consideration for entering into
this noncompetition agreement, (ii) the Company is currently engaged in business
in the Telecommunications Industry, and is either actively engaged in each
aspect thereof set out in the definition set forth in Section 6(b) above, or it
reasonably anticipates that it will be engaged in each such aspect or activity
competitive with it, during the Employment Period, and that part of Executive's
responsibilities as Chief Executive Officer of the Company and as Chairman of
the Board of Directors of the Company are and will continue to be to explore and
expand the Company into each aspect of the Telecommunications Industry where it
can profitably do so, (iii) the nature of the Telecommunications Industry is
such that the range of business and competition is not necessarily contained
within easily

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definable geographic territories, and that in many respects, otherwise unrelated
aspects of the Telecommunications Industry are competitive with each other (for
example, cable television providers, telephone companies and ISPs all compete
with each other to provide Internet access and services to consumers and
businesses), (iv) the business of investing in and operating RLECs, ILECs, CLECs
and/or ISPs is highly competitive, and (v) by reason of his responsibilities as
Chief Executive Officer of the Company and as Chairman of the Board of Directors
of the Company, he will be intimately familiar with and engaged in developing
the Company's business, financial and growth plans and other Confidential
Information, and that if he engages in any of the activity prohibited by this
Section 6, it is inevitable that he would use or disclose Confidential
Information of the Company.

        (e) GOVERNING LAW; ENFORCEMENT; SURVIVAL. Notwithstanding the provisions
of Section 8(c), the provisions of Section 5 and the provisions of this Section
6 shall be construed and enforced in accordance with the laws of the State of
North Carolina, without regard to principles of conflict of laws. Executive
agrees that the Company would suffer irreparable harm in the event of any
violation of Sections 5 or 6 hereof, and the Company is therefore entitled to
injunctive relief to enforce the provisions thereof The provisions of Sections 5
and 6 shall survive the termination of this Agreement in accordance with their
terms, and shall inure to the benefit of the Company and its affiliates, and
each of their successors and assigns.

        (f) SEVERABILITY. In the event that any provision contained herein is
held to be invalid, prohibited or unenforceable because of the scope, duration
or area of applicability, such provision shall be ineffective only to the extent
of such invalidity, prohibition or unenforceability. Executive and the Company
agree that it is each of their intent and desire that the provisions of Section
6 be enforced to the absolute greatest extent permissible by law, and they each
therefore agree and request that, to the extent a court determines these
provisions or any part thereof are unenforceable to any extent, such court may
and should limit the enforcement to discrete geographic territories set forth in
Section 6(c), or to specific states in which the Company is doing business, or
to specific aspects of the Telecommunications Industry, as listed in Section 6,
as the court deems necessary to the enforceability of the letter and intent of
this Agreement..

     7. SEVERABILITY. If any provision of this Agreement is held to be illegal,
invalid or unenforceable under present or future laws, such provision shall be
fully severable, this Agreement shall be construed and enforced as if such
illegal, invalid or unenforceable provision had never comprised a part of this
Agreement, and the remaining provisions of this Agreement shall remain in full
force and effect and shall not be affected by the illegal, invalid or
unenforceable provision or by its severance from this Agreement. This Section 7
is intentionally in addition to but not in replacement of Section 6(f) above.

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     8. MISCELLANEOUS.

        (a) COUNTERPARTS. This Agreement may be executed in several counterparts
each of which is an original. This Agreement and any counterpart so executed
shall be deemed to be one and the same instrument. It shall not be necessary in
making proof of this Agreement or any counterpart hereof to produce or account
for any of the other counterparts.

        (b) CONTENTS OF AGREEMENT; PARTIES-IN-INTEREST. This Agreement sets
forth the entire understanding of the parties regarding the subject matter
hereof. Any previous agreements or understandings between the parties regarding
the subject matter hereof are merged into and superseded by this Agreement. All
representations, warranties, covenants, terms, conditions and provisions of this
Agreement shall be binding upon and inure to the benefit of and be enforceable
by the respective heirs, legal representatives, successors and permitted assigns
of the Company and the Executive. Neither this Agreement nor any rights,
interests or obligations hereunder may be assigned by any party without the
prior written consent of the other party hereto.

        (c) NEW YORK LAW TO GOVERN. EXCEPT AS PROVIDED IN SECTION 6(e), THIS
AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK WITHOUT REGARD TO THE PRINCIPLES OF CONFLICT OF LAWS.

        (d) SECTION HEADINGS. The section headings herein have been inserted for
convenience of reference only and shall in no way modify or restrict any of the
terms or provisions hereof.

        (e) NOTICES. All notices, requests, demands and other communications
which are required or permitted hereunder shall be sufficient if given in
writing and delivered personally or by registered or certified mail, postage
prepaid, or by facsimile transmission (with a copy simultaneously sent by
registered or certified mail, postage prepaid), as follows (or to such other
address as shall be set forth in a notice given in the same manner):

                           If to the Company, to:

                                    FairPoint Communications, Inc.
                                    521 East Morehead Street, Suite 250
                                    Charlotte, North Carolina 28202
                                    Facsimile:   (704) 344-1594
                                    Attn:   Shirley J.  Linn, Esq.

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                           Copy to:

                                    Paul, Hastings, Janofsky & Walker LLP
                                    Park Avenue Tower
                                    75 E. 55th Street
                                    New York, New York 10022-3205
                                    Facsimile:   (212) 339-9150
                                    Attn:   Thomas E.  Kruger, Esq.

                           If to the Executive, to:

                                    Eugene B.  Johnson
                                    920 Berkeley Avenue
                                    Charlotte, North Carolina 28203

        (f) MODIFICATION AND WAIVER. Any of the terms or conditions of this
Agreement may be waived in writing at any time by the party which is entitled to
the benefits thereof, and this Agreement may be modified or amended at any time
by the Company and the Executive. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by each of the
parties hereto. No waiver of any of the provisions of this Agreement shall be
deemed or shall constitute a waiver of any other provision hereof nor shall such
waiver constitute a continuing waiver.

        (g) THIRD PARTY BENEFICIARIES. Except as otherwise expressly set forth
herein, no individual or entity shall be a third-party beneficiary of the
representations, warranties, covenants and agreements made by any party hereto.

        (h) TERMINATION OF PRIOR ARRANGEMENTS. The parties hereto acknowledge
and agree that this Agreement supersedes and terminates all existing employment
and severance agreements or arrangements between the Company and/or any of its
affiliates and the Executive, including but not limited to Executive's
employment agreement with the Company dated January 1, 2002.

        (i) EXECUTIVE'S LEGAL FEES. The reasonable costs and expenses for legal
services incurred by Executive in the negotiation and execution of this
Agreement shall be paid by the Company.

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     IN WITNESS WHEREOF, the parties hereto have executed or have caused this
Agreement to be duly executed as of the date first above written.

                                         EXECUTIVE

                                         /s/ Eugene B. Johnson
                                         -----------------------------------
                                         Eugene B. Johnson

                                         FAIRPOINT COMMUNICATIONS, INC.

                                         By:  /s/ Walter E. Leach
                                              ------------------------------
                                         Name: Walter E. Leach
                                               -----------------------------
                                         Title: Senior Vice President
                                                ----------------------------

                                       11EXHIBIT 10.2  

AMENDED AND RESTATED

EMPLOYMENT AGREEMENT  

        This Amended and Restated Employment Agreement (this "Agreement") is made as of December 20, 2002, (the "Effective Date") among Carter
Holdings, Inc., a Massachusetts corporation ("Holdings"), The William Carter Company, a Massachusetts corporation (the "Company"), and Frederick J. Rowan, II ("Executive") and shall replace in
its entirety the Amended and Restated Employment Agreement made as of August 15, 2001 (the "Prior Agreement"). Certain capitalized terms that are used in this Agreement are defined in
paragraph 11. 

        The
parties agree as follows: 

        1.    Employment.    Holdings and the Company agree to employ Executive, and Executive hereby accepts employment with
Holdings and the Company, upon the terms and conditions set forth in this Agreement for the period beginning on the "Effective Date" and ending as provided in paragraph 4 (the "Employment
Period"). 

        2.    Position and Duties.    

        (a)    During
the Employment Period, Executive shall serve as the President, Chief Executive Officer and Chairman of the Board of Holdings and the Company and shall have the
normal duties, responsibilities and authority of such positions, subject to any limitations imposed by the bylaws of Holdings or the Company and to the power of the boards of directors of Holdings and
the Company to expand or limit such duties, responsibilities and authority and to override actions of the Executive. 

        (b)    Executive
shall report to the boards of directors of Holdings and the Company and Executive shall devote his best efforts and his full business time and attention
(except for permitted vacation periods and reasonable periods of illness or other incapacity) to the business and affairs of Holdings and the
Company. Executive shall perform his duties and responsibilities to the best of his abilities in a diligent, trustworthy, businesslike and efficient manner. 

        (c)    Executive's
principal office and place of employment shall be at the Company's facility located in the Atlanta, Georgia metropolitan area, unless a different place is
agreed upon by the Company and the Executive. For all purposes of this Agreement, Holdings' and the Company's principal executive offices shall be located wherever Executive has his principal office
and place of employment. This paragraph 2(c) is a material part of this Agreement. 

        3.    Compensation.    

        (a)    Base Salary.    Executive's base salary shall be $683,000 per annum for the Company's fiscal year 2002. On each
January 1 occurring after the Effective Date and during the Employment Period, the Executive's base salary then in effect shall be increased by the applicable Cost of Living Amount. The
Company's Board of Directors may in its discretion increase Executive's base salary at such times and in such amounts as the Board of Directors determines but at no time shall Executive's base salary,
in effect from time to time, be decreased. As used in this Agreement, "Base Salary" means the Executive's base salary as adjusted and in effect from time to time. Executive's Base Salary shall be
payable by the Company in regular installments in accordance with the Company's general payroll practices. 

        (b)    Annual Cash Bonus Plan.    Executive shall be a participant in the Company's Annual Cash Bonus Plan and be
eligible for an annual award under such plan at a maximum award level equal to no less than one hundred percent (100%) of Executive's Base Salary in effect during the calendar year for which the award
is made. 

        (c)    Vacation.    Executive shall be entitled to four (4) weeks paid vacation annually. 

        (d)    Fringe Benefits.    Executive shall receive the fringe benefits described on Exhibit A to this Agreement
and such other benefits as are made available to executive level employees of the Company 

 

and such other benefits, payments or allowances as the Company's Board of Directors (or an appropriate committee of the board) may from time to time make available to Executive. Without prejudice to
Executive's rights under this Agreement, the Company reserves the right (i) to modify the terms of any benefit plan that is generally made available to executive level employees of the Company
and in which Executive participates so long as such changes affect all plan participants equally (or in proportion to their respective interests), and (ii) to make reasonable changes in
benefits established for Executive at the direction of the Company's Board of Directors, so long as the benefits available to Executive after giving effect to such change are not materially different
from those being provided prior to such change. 

        (e)    Business Expenses.    The Company shall reimburse Executive for all reasonable and necessary expenses incurred
by him in connection with the performance of his duties and responsibilities pursuant to this Agreement which are consistent with the Company's policies in effect from time to time with respect to
travel, entertainment and other business expenses, subject to the Company's reasonable requirements with respect to reporting and documentation of such expenses. 

        (f)    Additional Bonus.    On the Effective Date the Company shall pay to Executive a one-time bonus of
$5,000,000. 

        4.    Term and Termination.    

        (a)    The
Employment Period shall extend until December 20, 2007; provided that (i) the Employment Period shall terminate prior to such date upon Executive's
resignation, Retirement or death and (ii) the Employment Period may be terminated by the Company at any time prior to such date for Cause, Executive's Disability or Without Cause. 

        (b)    Any
termination of Executive's employment by the Company pursuant to clause 4(a) (ii) above, and any termination of Executive's employment by the Executive
pursuant to paragraph 4(a) (i) above, shall be communicated by written Termination Notice given to the other party hereto; provided that in the case of Executive's death, a Termination
Notice shall be deemed to have been given as of the date of his death; and, provided further that, in the case of a termination for Cause, there shall also have been delivered to the Executive the
Board of Directors' resolution to be delivered if and as provided in the definition of Cause. For purposes of this Agreement, a "Termination Notice" shall mean a notice which shall indicate the
specific termination provision in this Agreement relied upon and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive's
employment under the provision so indicated. 

        (c)    "Termination
Date" means (i) if this Agreement is terminated for Disability, 30 days after Termination Notice is given (provided that the Executive shall
not have returned to the performance of his duties on a full-time basis during such 30-day period), (ii) if Executive resigns or takes Retirement, the date specified in
the Executive's Termination Notice (or if no Termination Notice is given, the date upon which such termination is effective), (iii) if Executive dies, on the last day of the month next
succeeding the month during which Executive's death occurs, and (iv) if the Executive's employment is terminated for any other reason, the date on which a Termination Notice is given. 

        5.    Severance Compensation.    

        (a)    General.    If Executive resigns, terminates employment by his death or Retirement or is terminated for Cause,
the Company will pay Executive his Base Salary in effect at the time the Termination Notice is given (or deemed given) through the Termination Date and neither Holdings nor the Company shall have any
further obligations to Executive under this Agreement. Without prejudice to any accrued and vested rights Executive may have under the Supplemental Retirement Agreement, the Annual Cash Bonus Plan,
the Retirement Savings Plan or the Severance Pay Plan and except as otherwise required by law, all of Executive's rights to fringe benefits from the Company will cease as of the Termination Date. 

2

 

        (b)    Disability.    During any period that the Executive fails to perform his duties as a result of incapacity due
to mental illness or physical illness or injury, he shall continue to receive his full Base Salary and benefits until the Company terminates his employment for Disability. Thereafter, he will be
entitled to major medical health insurance coverage under the Company's employee group health insurance (or substantially similar health insurance) until the third anniversary of the Termination Date
or until the Executive obtains employment with another employer that makes health insurance available to its employees, whichever occurs first, and shall be entitled to receive disability benefits in
accordance with the disability income insurance plan or plans maintained by the Company covering Executive at the Termination Date. Without prejudice to any accrued and vested rights Executive may
have under the Supplemental Retirement Agreement, the Annual Cash Bonus Plan or the Retirement Savings Plan and except as otherwise required by law or as provided in this paragraph 5(b), all of
Executive's rights to fringe benefits from the Company will cease as of the Termination Date. 

        (c)    Without Cause.    If Executive is involuntarily terminated by the Company Without Cause, (i) Executive
shall be entitled to continue to receive his Base Salary (as in effect on the Termination Date) for thirty-six (36) months following the Termination Date (such date, the "End Date")
so long as Executive has not breached the provisions of paragraphs 6, 7 or 8, (ii) the Company will maintain in full force and effect, for Executive's continued benefit, until the End Date, all
life, medical and dental insurance programs in which Executive was entitled to participate so long as his continued participation is possible under the general terms and provisions of such programs
(provided that, in the event Executive's participation in any such program is barred, the Company will arrange to provide the Executive with benefits substantially similar to those which he was
entitled to receive under such program), (iii) notwithstanding any provision in the Annual Cash Bonus Plan to the contrary, the Executive shall become fully vested and have a
non-forfeitable interest in the benefit which he has accrued under the Annual Cash Bonus Plan as of the Termination Date (and shall be given full credit under the Annual Cash Bonus Plan
for the benefit that he would have accrued for the plan year during which the Termination Date occurs (which determination may take into account whether Company performance goals established by the
plan or its administrator for such year have been met, but which may not take into account whether personal performance goals established by the plan or its administrator for such year have been met)
if he were employed by the Company on the last day of such plan year), and (iv) Executive will be entitled to service credit under the Supplemental Retirement Agreement through the End Date.
The amounts payable in respect of accrued benefits under the Annual Cash Bonus Plan shall be payable at the time provided for in, and in accordance with the provisions of, the Annual Cash Bonus Plan.
The amounts payable pursuant to this paragraph 5(c) in
respect of Base Salary may be payable, at Executive's discretion, in one lump sum payment within 30 days following the Termination Date equal to the present value (determined using a discount
rate equal to the "prime" rate of interest charged by Chase Manhattan Bank in New York plus two percentage points) of the payments otherwise payable pursuant to this paragraph 5(c). This
paragraph 5(c) sets forth Executive's exclusive remedy for a termination of his employment Without Cause and Executive shall have no other right or remedy against Holdings or the Company in
connection therewith. 

        (d)    The
Executive's right to receive payments under this Agreement shall not decrease the amount of, or otherwise adversely affect, any other benefits payable to the
Executive under any plan, agreement or arrangement relating to employee benefits provided by the Company (or an Affiliated Corporation); provided, however, that the amounts payable to the Executive
under paragraph 5(c)(i) shall be reduced by the amount of any severance compensation payable to Executive under the Company's Severance Pay Plan. 

        (e)    The
Executive shall not be required to mitigate the amount of any payment provided for in this paragraph 5 by seeking other employment or otherwise, nor shall the
amount of any payment or benefit provided for in this paragraph 5 be reduced by any compensation earned by the Executive as 

3

 

the result of employment by another employer or by reason of the Executive's receipt of or right to receive any retirement or other benefits after the date of termination of employment or otherwise
(except as otherwise provided in this paragraph 5). 

        6.    Confidential Information.    The Executive acknowledges that the non-public information obtained by
him while employed by Holdings and the Company concerning the business or affairs of Holdings, the Company or any other Subsidiary of Holdings ("Confidential Information") are the property of
Holdings, the Company or such other Subsidiary. For purposes of this Agreement, the term "Confidential Information" does not include information that Executive can demonstrate (a) was in
Executive's possession prior to his initial employment by the Company, provided that such information is not known by Executive to be subject to another confidentiality agreement with, or other
obligation of secrecy to, the Company or another party, (b) is generally available to the public and became generally available to the public other than as a result of a disclosure in violation
of this Agreement, or (c) became available to Executive on a non-confidential basis from a third party, provided that such third party is not known by Executive to be bound by a
confidentiality agreement with, or other obligation of secrecy to, the Company or another party or is otherwise prohibited from providing such information to Executive by a contractual, legal or
fiduciary obligation. Executive agrees that he will not disclose Confidential Information to any person (other than employees of Holdings, the Company or any Subsidiary thereof or any other person
expressly authorized by Holdings' Board of Directors to receive Confidential Information) or use for his own account any Confidential Information without the prior written consent of Holdings' Board
of Directors. Executive shall deliver to the Company at the termination of the Employment Period, or at any other time Holdings' Board of Directors may request in writing, all memoranda, notes, plans,
records, reports, computer tapes and software and other documents and data (and copies thereof) containing Confidential Information or Work Product which he may then possess or have under his control. 

        7.    Work Product.    Executive agrees that all inventions, innovations, improvements, developments, methods,
designs, analyses, reports and all similar or related information which relate to Holdings' or the Company's or any of its Subsidiaries' actual or anticipated business, research and development or
existing or future products or services and which are conceived, developed or made by Executive while employed with the Company ("Work Product") belong to Holdings, the Company or such Subsidiary.
Upon the written request of Holdings' Board of Directors, Executive will promptly disclose such Work Product to Holdings' Board of Directors and perform all actions reasonably requested by Holdings'
Board of Directors (whether during or after the Employment Period) to establish and confirm such ownership. 

        8.    Noncompete; Non-Solicitation.    

        (a)    Executive
acknowledges that in the course of his employment with Holdings and the Company he will become familiar with the trade secrets and other confidential
information of Holdings, the Company and other Subsidiaries of Holdings and that his services will be of special, unique and extraordinary value to Holdings and the Company. Therefore, Executive
agrees that, during the Employment Period and for two years thereafter (or one year thereafter, if Executive's employment is terminated Without Cause) (the "Noncompete Period"), he shall not directly
or indirectly own, manage, control, participate in, consult with, render services for, or in any manner engage in any business competing with the businesses of Holdings and the Company or any of its
Subsidiaries which (i) exist on the date of the termination of Executive's employment or (ii) are commenced during the Noncompete Period (but, for purposes of this clause (ii)
only if Holdings, the Company or such Subsidiary had determined prior to the Termination Date to enter into such business or had committed substantial resources prior to the Termination Date to
determine the feasibility of entering into such business), within the United States and any other geographical area in which Holdings or any of its Subsidiaries engage in such businesses. Nothing
herein shall prohibit Executive from being a passive 

4

 

owner of not more than 2% of the outstanding stock of any class of a corporation which is publicly traded so long as Executive has no active participation in the business of such corporation. 

        (b)    During
the Noncompete Period, Executive shall not directly or indirectly through another entity (i) induce or attempt to induce any employee of Holdings, the
Company or any other Subsidiary of Holdings to leave the employ of such person, or in any way interfere with the employee relationship between Holdings, the Company or any other Subsidiary of Holdings
and any employee thereof, (ii) hire any person who was an employee of Holdings, the Company or any other Subsidiary of Holdings at any time during the Employment Period (other than individuals
who have not been employed by Holdings, the Company or any other Subsidiary of Holdings for a period of at least one year prior to employment by Executive directly or indirectly through another
entity), or (iii) induce or attempt to induce any customer, supplier, licensee or other person having a business relationship with Holdings, the Company or any other Subsidiary of Holdings to
cease doing business with Holdings, the Company or such other Subsidiary of Holdings, or interfere materially with the relationship between any such customer, supplier, licensee or other person having
a business relationship with Holdings, the Company or any other Subsidiary of Holdings. 

        (c)    If,
at the time of enforcement of this paragraph 8, a court shall hold that the duration, scope or area restrictions stated herein are unreasonable under
circumstances then existing, the parties agree that the maximum duration, scope or area reasonable under such circumstances shall be substituted for the stated duration, scope or area and that the
court shall be allowed to revise the restrictions contained herein to cover the maximum period, scope and area permitted by law. 

        (d)    In
the event of the breach or a threatened breach by Executive of any of the provisions of this paragraph 8, each of Holdings and the Company, in addition and
supplementary to other rights and remedies existing in its favor, may apply to any court of law or equity of competent jurisdiction for specific performance or injunctive or other relief in order to
enforce or prevent any violations of the provisions hereof (without posting a bond or other security). 

        9.    Incapacity.    Without prejudice to Executive's rights under this Agreement, if at any time during the term of
this Agreement Executive is absent from his duties with the Company for 30 consecutive days as a result of incapacity due to mental illness or physical illness or injury, each of Holdings' and the
Company's boards of directors may appoint an interim Chairman of the Board, President and Chief Executive Officer or assume extended management responsibilities for the duration of Executive's
absence. Unless Executive's employment has been terminated previously under this Agreement, Executive shall be permitted to resume performance of his duties and responsibilities under this Agreement
upon regaining the capacity to do so. 

        10.    Executive Representations.    Executive hereby represents and warrants to Holdings and the Company that
(a) the execution, delivery and performance of this Agreement by Executive does not and will not conflict with, breach, violate or cause a default under any contract, agreement, instrument,
order, judgment or decree to which Executive is a party or by which he is bound, (b) Executive is not a party to or bound by any employment agreement, noncompete agreement or confidentiality
agreement with any other person or entity with which this Agreement would conflict or constitute a breach thereof and (c) upon the execution and delivery of this Agreement by Holdings and the
Company, this Agreement shall be the valid and binding obligation of Executive, enforceable against Executive in accordance with its terms, subject to bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and similar laws affecting the enforceability of contractual obligations and creditor's rights generally and to federal and state constitutional proscriptions and by the
application of equitable principles by courts of competent jurisdiction, sitting at law or in equity. 

5

 

        11.    Certain Defined Terms.    As used in this Agreement, the following terms shall have the meanings set forth
below: 

        "Affiliated
Corporation" means any corporation that is a member of the "affiliated group" (as defined in Section 1504 of the Code) of which the Company is a member. 

        "Anniversary
Date" means any or a specific anniversary of the Effective Date, as the context requires. 

        "Cause"
means (a) conviction of Executive for a felony, or the entry by Executive of a plea of guilty or nolo contendere to a felony, (b) a willful and material breach by
Executive of paragraph 6, 7 or 8 of this Agreement, (c) the commission of an act of fraud involving dishonesty for personal gain which is materially injurious to the Company,
(d) the willful and continued refusal by the Executive to substantially perform his duties with the Company (other than any such refusal resulting from his incapacity due to mental illness or
physical illness or injury), after a demand for substantial performance is delivered to the Executive by the Company's Board of Directors, where such demand specifically identifies the manner in which
the Company's Board of Directors believes that the Executive has refused to substantially perform his duties and the passage of a reasonable period of time for Executive to comply with such demand or
(e) the willful engaging by the Executive in gross misconduct materially and demonstrably injurious to the Company or its Subsidiaries. For purposes of this paragraph, no act or failure to act
on the Executive's part shall be considered "willful" unless done, or omitted to be done, by the Executive not in good faith and without reasonable belief that his action or omission was in the best
interest of the Company or its Subsidiaries. Notwithstanding the foregoing, with respect to termination for Cause arising out of conduct described in clause (b), (c), (d) or
(e) above, the Executive may not be terminated for Cause unless there shall have been delivered to the Executive a copy of a resolution duly adopted by the affirmative vote of not less than
three-quarters of the entire Board of Directors of the Company, at a meeting of such board called and held for that purpose (after reasonable notice to the Executive and an opportunity for the
Executive, together with his counsel or other advisors, to be heard at such meeting), finding that in the good faith opinion of the board the Executive had engaged in conduct described above in
clause (b), (c), (d), or (e) of the first sentence of this paragraph and specifying the particulars thereof in detail. Such a finding by the Board of Directors of the Company is a
prerequisite to a termination for Cause pursuant to clauses (b), (c), (d) or (e) above; provided, however, that such a finding may be challenged, by appropriate judicial process, on the
merits (i.e., that Cause did not exist) or on the basis that the board's finding was not made in good faith (provided that proof that Cause for termination existed shall be a complete defense to any
showing that the board's findings was not made in good faith). 

        "Code"
means the Internal Revenue Code of 1986, as amended. 

        "Cost
of Living Amount" means an amount calculated by multiplying the Base Salary then in effect by a fraction, (a) the numerator of which shall be the amount (not less than zero)
by which the latest Cost of Living Index available as of the time of determination exceeds the Cost of Living Index for the same period during the immediately preceding year, and (b) the
denominator of which shall be the latest Cost of Living Index for the same period during the immediately preceding year. 

        "Cost
of Living Index" means the Consumer Price Index for All Urban Consumers, Atlanta, Georgia (1967-100) prepared by the Bureau of Labor Statistics of the United States
Department of Labor for the relevant period; provided that if the index shall cease to be published, the parties shall use as the index, the most comparable index published by the United States
Government. 

        "Disability"
means the Executive shall have been absent from his duties with the Company for 26 consecutive weeks as a result of incapacity due to mental illness or physical illness or
injury, and he shall not have returned to the full-time performance of his duties within 30 days after written notice of termination of this Agreement is given by the Company's
Board of Directors. 

6

 

        "End
Date" is defined in paragraph 5(c). 

        "Good
Reason" means, unless Executive shall have consented in writing thereto, any of the following: 

        (a)    except
as provided in paragraph 9, a material reduction in Executive's title, duties, responsibilities or status, as compared to such title, duties,
responsibilities or status on the Effective Date; 

        (b)    the
assignment to Executive of a material amount of different or additional duties that are significantly inconsistent with Executive's office on the Effective Date; 

        (c)    the
imposition on Executive of business travel obligations substantially greater than his business travel obligations during the year prior to the Effective Date; or 

        (d)    any
material breach of this Agreement on the part of Holdings or the Company; 

provided,
however, that Executive shall not have the right to terminate his employment for "Good Reason" unless he shall have given thirty (30) days prior written notice to the Board of
Directors of the Company in which Executive sets forth in reasonable detail the circumstances that Executive believes constitute "Good Reason" pursuant to the preceding clauses (a) through
(d) and the Company shall not have remedied the matter within said thirty (30) day period; and provided, further, however that the fact that the Company does or does not so remedy said
matter shall not be deemed an admission by the Company that such circumstances constitute "Good Reason". 

        "Person"
means an individual, a partnership, a joint venture, a corporation, an association, a joint stock company, a limited liability company, a trust, an unincorporated organization
or a government or any department or agency or political subdivision thereof. 

        "Retirement"
means termination of Executive's employment in accordance with the Company's normal retirement policy generally applicable to its salaried employees (or, at Executive's
election, at any time) or in accordance with any other retirement arrangement established with the Executive's consent with respect to the Executive. 

        "Retirement
Savings Plan" means the Company's Defined Contribution 401(k) savings plan in effect as of the Effective Date as the same is amended from time to time. 

        "Severance
Pay Plan" means the Company's Severance Pay Plan for Exempt Employees, in effect as of the Effective Date, as the same is amended from time to time. 

        "Subsidiary"
means with respect to any corporation, another corporation of which the securities having a majority of the voting power in electing directors are, at the time of
determination, owned by the first corporation, directly or through one or more Subsidiaries. 

        "Supplemental
Retirement Agreement" means the Supplemental Executive Retirement Agreement between the Executive and the Company as amended though the Effective Date. 

        "Termination
Date" is defined in paragraph 4(c). 

        "Termination
Notice" is defined in paragraph 4(b). 

        "Without
Cause" means an involuntary termination of Executive's employment by the Company other than for Cause or due to Executive's death or Disability or a termination of employment by
Executive for Good Reason. 

        12.    Survival.    Paragraphs 6, 7 and 8 shall survive and continue in full force in accordance with their terms
notwithstanding any termination of the Employment Period. 

7

 

        13.    Expenses.    The Company shall pay all of Executive's expenses (including reasonable attorneys' fees and
expenses) paid by Executive in connection with the negotiation and preparation of this Agreement
and all related documents. In the event Executive prevails in any arbitration or litigation arising out of his termination of employment or his seeking to obtain or enforce any right or benefit
provided by this Agreement or by any other plan or arrangement maintained by the Company under which he is or may be entitled to receive benefits, the Company shall pay all reasonable legal fees and
related expenses (including the costs of experts, evidence and counsel and other such expenses included in connection with any litigation or appeal) incurred by the Executive in such an arbitration or
litigation. To the extent any of the foregoing expense reimbursement generates taxable income to the Executive, the Executive will be paid an additional amount to defray tax liability resulting from
such expense reimbursement (and such additional payment). The Company further agrees to pay prejudgment interest on any money judgment against the Company obtained by the Executive in any arbitration
or litigation against it to enforce such rights calculated at the Prime Rate as reported in the Wall Street Journal in effect from time to time from the date it is determined that payment(s) to him
should have been made under this Agreement. 

        14.    Notices.    Any notice provided for in this Agreement shall be in writing and shall be either personally
delivered, or mailed by first class mail, return receipt requested, to the recipient at the address below indicated: 

	 	 	Notices to Executive:	 	 
	 	 	 	 	 
	 	 	Frederick J. Rowan, II

Chairman, Chief Executive Officer and President

4280 Olde Mill Lane

Atlanta, GA 30342	 	 
	 	 	 	 	 
	 	 	Notices to Holdings or the Company:	 	 
	 	 	 	 	 
	 	 	c/o The William Carter Company

1170 Peachtree Street, Suite 900

Atlanta, Georgia 30309

Attn: David A. Brown

          Executive Vice President	 	 
	 	 	 	 	 
	 	 	with copies to:	 	 
	 	 	 	 	 
	 	 	Berkshire Partners LLC

One Boston Place

Boston, MA 02108-4401

Attn: Ross M. Jones	 	 
	 	 	 	 	 
	 	 	Ropes & Gray

One International Place

Boston, MA 02110

Attn: David C. Chapin	 	 

or
such other address or to the attention of such other person as the recipient party shall have specified by prior written notice to the sending party. Any notice under this Agreement will be deemed
to have been given when so delivered or on the second business day after being deposited for delivery with the United States Postal Service. 

8

 

        15.    Severability.    Whenever possible, each provision of this Agreement will be interpreted in such manner as to
be effective and valid under applicable law, but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction,
such invalidity, illegality or unenforceability will not affect any other provision or any other jurisdiction, but this Agreement will be reformed, construed and enforced in such jurisdiction as if
such invalid, illegal or unenforceable provision had never been contained herein. 

        16.    Complete Agreement.    This Agreement and those documents expressly referred to herein embody the complete
agreement and understanding among the parties and supersede and preempt any prior understandings, agreements or representations by or among the parties, written or oral, which may have related to the
subject matter hereof in any way, including without limitation the Prior Agreement. 

        17.    Counterparts.    This Agreement may be executed in separate counterparts, each of which is deemed to be an
original and all of which taken together constitute one and the same agreement. 

        18.    Successors and Assigns.    This Agreement is intended to bind and inure to the benefit of and be enforceable by
Executive, Holdings, the Company and their respective heirs, successors and assigns, except that no party may assign his or its rights or delegate his or its obligations hereunder without the prior
written consent of the other parties to this Agreement. 

        19.    Choice of Law.    This Agreement will be governed by and construed in accordance with the domestic law of the
State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdiction) that would cause the application of the
laws of any jurisdiction other than the State of New York. 

        20.    Amendment and Waiver.    The provisions of this Agreement may be amended or waived only with the prior written
consent of the Company and Executive, and no course of conduct or failure or delay in enforcing the provisions of this Agreement shall affect the validity, binding effect or enforceability of this
Agreement. 

        [The
remainder of the page is left intentionally blank.] 

9

 

        IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above. 

	 	 	CARTER HOLDINGS, INC.
	 	 	 	 	 
	 	 	By:	 	/s/  DAVID A. BROWN      

	 	 	 	 	 
	 	 	Its	 	Director and Secretary

	 	 	 	 	 
	 	 	 	 	 
	 	 	THE WILLIAM CARTER COMPANY
	 	 	 	 	 
	 	 	 	 	 
	 	 	By:	 	/s/  DAVID A. BROWN      

	 	 	 	 	 
	 	 	Its	 	Officer and Executive V.P.

	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	/s/  FREDERICK J. ROWAN, II      
 FREDERICK J. ROWAN, II

10

 
EXHIBIT A TO AMENDED AND RESTATED EMPLOYMENT AGREEMENT  

        In addition to those benefits set forth in the foregoing Amended and Restated Employment Agreement, the Company will provide the following benefits to Executive: 

        1.    Disability, Health and Life Insurance.    The Company will provide Executive with long-term
disability insurance that provides coverage at 67% of Base Salary (and if the Company fails to provide or keep in force such disability insurance, the Company will be obligated to make payments to
Executive in such amounts and at such times as Executive would have been entitled under such insurance), major medical health insurance and life insurance with a death benefit equal to 250% of Base
Salary. 

        2.    Company Car.    Executive will be paid a monthly car allowance of $1,000. 

        3.    Country Club Fees and Dues.    The Company or Holdings will pay all periodic dues and fees (not to exceed $4,000
annually) for Executive's membership in one country club or similar club or organization of Executive's choice (provided that to the extent that any of such fees or any initiation fee heretofore paid
by the Company or Holdings are refundable, any such refund shall be made to the Company and if Executive sells such membership the Company will be entitled to receive from (but only to the extent of)
the sale proceeds, the amount of the initiation fee it paid on Executive's behalf). 

        4.    Supplemental Executive Retirement Agreement and Trust.    Executive, Holdings and the Company will retain the
Supplemental Executive Retirement Agreement and The Frederick J. Rowan Retirement Trust. 

11

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