Document:

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                                                                   EXHIBIT 10.24

                                    CONSENT

     THIS CONSENT (this "Consent"), dated as of the 31st day of March, 2000,
                         -------
between PILLOWTEX CORPORATION, a Texas corporation (the "Borrower"), and BANK OF
                                                         --------
AMERICA, N.A. (formerly known as NationsBank, N.A.) ("Lender").
                                                      ------

                                 BACKGROUND
                                 ----------

     A.  The Borrower executed that certain Promissory Note, dated May 4,1999,
in the original principal amount of $20,000,000 and increased by amendment to
$35,000,000 (said Promissory Note, as amended, the "Promissory Note"; terms
                                                    ---------------
defined in the Promissory Note and not otherwise defined herein shall be used
herein as defined in the Promissory Note).

     B.  Article IV of the Promissory Note incorporates by reference Articles 5
(except for Section 5.8), 6 and 7 of the Credit Agreement and all definitions
thereto, and provides that no amendment of the Credit Agreement after May 4,
1999 shall be effective with respect to such Articles as they are incorporated
into the Promissory Note without the written consent of the Lender.

     C.  The Borrower is entering into a Waiver and Seventh Amendment to Amended
and Restated Credit Agreement, dated to be effective as of March 31, 2000, with
the lenders party thereto and Bank of America, N.A., as administrative agent
(the "Seventh Amendment"), which, among other things, amends certain provisions
      -----------------
of Articles 6 and 7 of the Credit Agreement.

     D.  The Borrower has requested that the Lender execute this Consent.

     NOW, THEREFORE, in consideration of the covenants, conditions and
agreements hereafter set forth, and for other good and valuable consideration,
the receipt and adequacy of which are all hereby acknowledged, the parties
hereto covenant and agree as follows:

     1.  CONSENT.  The Lender hereby (a) consents to the Seventh Amendment and
         -------
(b) agrees that the amendment of certain provisions of Articles 6 and 7 of the
Credit Agreement as provided in the Seventh Amendment shall be effective as of
March 31, 2000 with respect to the Promissory Note such that those provisions of
the Credit Agreement, as amended by the Seventh Amendment, are incorporated into
the Promissory Note.

     2.  REPRESENTATIONS AND WARRANTIES TRUE; NO EVENT OF DEFAULT.  By its
         --------------------------------------------------------
execution and delivery hereof, the borrower represents and warrants that, as of
the date hereof and after giving effect to the Consent set forth in the
foregoing Section 1:
     (a) the representations and warranties contained in the Promissory Note are
true and correct on and as of the date hereof as made on and as of such date;
and
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     (b) no event has occurred and is continuing which constitutes an Event of
Default.

     3.  CONDITIONS OF EFFECTIVENESS.  This Consent shall be effective as of
         ---------------------------
March 31, 2000, subject to the following:

     (a) the representations and warranties set forth in Section 2 of this
Consent shall be true and correct;

     (b) the Lender shall have received counterparts of this Consent executed by
the Borrower and acknowledged by each Guarantor; and

     (c) the Lender shall have received in form and substance satisfactory to
the Lender, such other documents, certificates and instruments as the Lender
shall require.

     4.  GUARANTOR'S ACKNOWLEDGMENT. By signing below, each Guarantor (i)
         --------------------------
acknowledges, consents and agrees to the execution, delivery and performance by
the Borrower of this Consent, (ii) acknowledges and agrees that its obligations
in respect of its Guaranty Agreement are not released, diminished, waived,
modified, impaired or affected in any manner by this Consent, or any of the
provisions contemplated herein, (iii) ratifies and confirms its obligations
under its Guaranty Agreement, and (iv) acknowledges and agrees that it has no
claim or offsets against, or defenses or counterclaims to, its Guaranty
Agreement as a result of this Consent.

     5.  REFERENCE TO THE PROMISSORY NOTE.
         --------------------------------

     (a) Upon the effectiveness of this Consent, each reference in the
Promissory Note to "this Note", "hereunder", or words of like import shall mean
and be a reference to the Promissory Note, as affected by this Consent.

     (b) The Promissory Note, as affected by this Consent, shall remain in full
force and effect and is hereby ratified and confirmed.

     6.  COSTS, EXPENSES AND TAXES.  The Borrower shall be obligated to pay the
         -------------------------
costs and expenses of the Lender in connection with the preparation,
reproduction, execution and delivery of this Consent and the other instruments
and documents to be delivered hereunder.

     7.  EXECUTION IN COUNTERPARTS; EXECUTION VIA FACSIMILE.  This Consent may
         --------------------------------------------------
be executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed and delivered shall be
deemed to be an original and all of which when taken together shall constitute
but one and the same instrument.  This Consent may be validly executed and
delivered by facsimile or other electronic transmission.

                                      -2-
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     8.  GOVERNING LAW; BINDING EFFECT.  This Consent shall be governed by and
         -----------------------------
construed in accordance with the laws of the State of Texas, and shall be
binding upon the Borrower and each Lender and their respective successors and
assigns.

     9.  HEADINGS.  Section headings in this Consent are included herein for
         --------
convenience of reference only and shall not constitute a part of this Consent
for any other purpose.

     10.  ENTIRE AGREEMENT.  THE PROMISSORY NOTE, AS AMENDED BY THIS CONSENT,
          ----------------
REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AS TO THE SUBJECT MATTER
THEREIN AND HEREIN AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS BETWEEN THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

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                         REMAINDER OF PAGE LEFT INTENTIONALLY BLANK
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                                      -3-
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     IN WITNESS WHEREOF, the parties hereto have executed this Consent as of the
date first above written.

                              PILLOWTEX CORPORATION

                              Jaime Vasquez
                              Vice President and Treasurer

                                      -4-
<PAGE>

BANK OF AMERICA, N.A. (formerly known as NationsBank, N.A.)

ACKNOWLEDGED AND AGREED:

PILLOWTEX, INC.
PTEX HOLDING COMPANY
PILLOWTEX MANAGEMENT SERVICES COMPANY
BEACON MANUFACTURING COMPANY
MANETTA HOME FASHIONS, INC.
TENNESSEE WOOLEN MILLS
FIELDCREST CANNON, INC.
CRESTFIELD COTTON COMPANY
ENCEE, INC.
FCC CANADA, INC.
FIELDCREST CANNON FINANCING, INC.
FIELDCREST CANNON LICENSING, INC.
FIELDCREST CANNON INTERNATIONAL, INC.
FIELDCREST CANNON SF, INC. (formerly know as Fieldcrest Cannon Sure Fit, Inc.)
FIELDCREST CANNON TRANSPORTATION, INC,
ST. MARYS, INC.
AMOSKEAG COMPANY
AMOSKEAG MANAGEMENT CORPORATION
DOWNEAST SECURITIES CORPORATION
BANGOR INVESTMENT COMPANY
MOORE'S FALLS CORPORATION
THE LESHNER CORPORATION
LESHNER OF CALIFORNIA, INC.
OPELIKA INDUSTRIES, INC.

Jaime Vasquez
Vice President and Treasurer

                                      -5-<PAGE>

                                                                   EXHIBIT 10.51

                             EMPLOYMENT AGREEMENT

     THIS AGREEMENT, dated as of December 15, 1999, is by and between Fieldcrest
Cannon, Inc., a Delaware corporation ("Employer"), and Richard A. Grissinger
("Employee").

                                  WITNESSETH:

     WHEREAS, Employee desires to enter into the employment of Employer and
Employer desires to employ Employee in the capacity and on the terms set forth
below.

     NOW, THEREFORE, in consideration of the foregoing recital and of the mutual
agreements contained herein, and for other valuable consideration, receipt of
which is hereby acknowledged, the parties hereto agree as follows:

     1.   Employment and Scope.
          --------------------
          (a)  Commencing as of December 15, 1999 (the "Commencement Date") and
continuing throughout the Term of this Agreement, Employer agrees to employ
Employee and Employee agrees to serve as the employee of Employer with the title
and capacity of Senior Vice President - Bed and Bath Marketing.  As such,
Employee's duties shall include responsibility for the marketing of all sheets,
top of the bed products and bed and bath products, as well as such other
responsibilities as may be assigned from time to time by the Chairman of the
Board, the Chief Executive Officer, the President, the Chief Operating Officer
or the President of Sales and Marketing of Employer.  Employee shall report to
the President of Sales and Marketing of Employer.

          (b)  Employee's performance of services under this Agreement shall
occur primarily at Employer's executive offices at One Lake Circle Drive,
Kannapolis, North Carolina

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28081, subject to such travel as is consistent with the office of Senior Vice
President - Bed and Bath Marketing.

          (c)  During the Term of Employee's employment, Employee shall devote
Employee's full business time (at least 40 hours per week) exclusively to the
performance of Employee's duties as stated in this Agreement and to the
furtherance of Employer's business.

          2.   Term.
               ----

     (a)  The term of this Agreement (the "Term") shall begin on the
Commencement Date and shall continue through the second anniversary thereof,
subject to automatic extension as provided below and unless terminated earlier
in accordance with Section 4.

     (b)  The Term of this Agreement will be automatically extended for an
additional one year at the end of the initial or any extended Term hereof unless
either Employer or Employee shall give the other at least six (6) months written
notice of termination, prior to the end of the initial Term or any extension of
the Term hereof.

     3.   Compensation.  During the Term of this Agreement, Employer shall
          ------------
compensate Employee as set forth below:

          (a)  Employer shall pay to Employee a base salary of $275,000, payable
in accordance with Employer's payroll policies in effect from time to time for
executive officers generally, subject to all appropriate withholdings.

          (b)  Employee shall be eligible to participate in Employer's incentive
bonus plans as they may be amended from time to time to the same extent as
similarly situated executive officers generally.

          (c)  Employee shall be entitled to the amount of vacation to which
Employee would be entitled under Employer's vacation policy as it may be amended
from time to time.

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          (d)  Employee shall be entitled to participate in Employer's health,
benefit and welfare plans offered by Employer as they may be amended from time
to time to the same extent as similarly situated executive officers of Employer
generally.

          (e)  Employer will pay Employee a car allowance of $750 per month plus
an additional amount equal to all federal and state income taxes arising with
respect to any portion of the allowance taxable as income to Employee.

     4.   Termination During Term.  Notwithstanding anything to the contrary in
          -----------------------
Section 2 of this Agreement, Employee's employment under this Agreement may be
terminated during the Term as set forth below:

          (a)  Employer may terminate Employee's employment for Cause, in which
case the parties' rights and obligations shall be as set forth in Section 5(a)
below.

          (b)  Employer may terminate Employee's employment in the absence of
Cause and other than upon Employee's Retirement or Permanent Disability, in
which case the parties' rights and obligations shall be as set forth in either
Section 5(b) or (e) below, as applicable.

          (c)  Employee's employment shall be terminated upon Employee's
Permanent Disability, in which case the parties' rights and obligations shall be
as set forth in Section 5(c) below.

          (d)  Employee's employment shall be terminated upon Employee's
Retirement, in which case the parties' rights and obligations shall be as set
forth in Section 5(d) below.

          (e)  In the event of a Change in Control of Pillowtex or Employer,
Employee may terminate Employee's employment (i) for any reason, for up to six
months after the Change in Control of Pillowtex or Employer, or (ii) for Good
Reason, in which case the parties' rights and obligations shall be as set forth
in Section 5(e) below.

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<PAGE>

          (f)  Employee may terminate Employee's employment at any time for any
reason not heretofore enumerated, in which case the parties' rights and
obligations shall be as set forth in Section 5(f) below.

          (g)  The following definitions shall apply for purposes of the early
termination of the Term of this Agreement:

               (i)    "Cause" shall mean the occurrence of any of the following:
(A) Employee's engagement in any personal misconduct involving willful
dishonesty, illegality, or moral turpitude that is demonstrably and materially
detrimental or injurious to the business interests, reputation or goodwill of
Employer or its affiliates; (B) Employee's engagement in any act involving
willful dishonesty, disloyalty, or infidelity against Employer or its
affiliates; (C) Employee's willful and continued breach of or failure
substantially to perform under any of the material terms and covenants of this
Agreement; and (D) Employee's willful and continued breach of or failure
substantially to perform under any material policy established by the Company
with respect to the operation of the Company's business and affairs, or the
conduct of the Company's employees. For purposes of this Section 4(g)(i), no
act, or failure to act, on Employee's part shall be considered "willful" unless
done, or omitted to be done, by Employee in bad faith and without reasonable
belief that Employee's action or omission was in the best interest of Employer.
Prior to asserting any action or failure to act as Cause for Employee's
termination as set forth above, Employer shall provide Employee a written notice
referencing this Section 4(g)(i), setting out with specificity the conduct
asserted to constitute Cause. Any disputes arising as to whether Cause existed
for Employee's termination shall be resolved through binding arbitration in
accordance with Section 9 of this Agreement.

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<PAGE>

               (ii)   "Change in Control of Pillowtex or Employer" means the
occurrence during the Term of any of the following events:

                      (A)  Pillowtex Corporation, a Texas corporation
("Pillowtex"), or Employer is merged, consolidated or reorganized into or with
another corporation or other legal person, and as a result of such merger,
consolidation or reorganization less than a majority of the combined voting
power of the then-outstanding securities entitled to vote generally in the
election of directors ("Voting Stock") of such corporation or person immediately
after such transaction are held in the aggregate by the holders of Voting Stock
of Pillowtex or Employer, as the case may be, immediately prior to such
transaction;

                      (B)  Pillowtex or Employer sells or otherwise transfers
all or substantially all of its assets to another corporation or other legal
person, and as a result of such sale or transfer less than a majority of the
combined voting power of the then-outstanding Voting Stock of such corporation
or person immediately after such sale or transfer is held in the aggregate by
the holders of Voting Stock of Pillowtex or Employer, as the case may be,
immediately prior to such sale or transfer;

                      (C)  There is a report filed on Schedule 13D or Schedule
14D-1 (or any successor schedule, form or report), each as promulgated pursuant
to the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
disclosing that any person (as the term "person" is used in Section 13(d)(3) or
Section 14(d)(2) of the Exchange Act) other than an "Excluded Person" as defined
below has become the beneficial owner (as the term "beneficial owner" is defined
under Rule 13d-3 or any successor rule or regulation promulgated under the
Exchange Act) of securities representing 35% or more of the combined voting
power of the then-outstanding Voting Stock of Pillowtex; or

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                      (D)  If, during any period of 24 consecutive months,
individuals who at the beginning of any such period constitute the Directors of
Pillowtex cease for any reason to constitute at least a majority thereof;
provided, however, that for purposes of this clause (D) each Director who is
first elected, or first nominated for election by Pillowtex's stockholders, by a
vote of at least two-thirds of the Directors of Pillowtex (or a committee
thereof) then still in office who were Directors of Pillowtex at the beginning
of any such period will be deemed to have been a Director of Pillowtex at the
beginning of such period.

               (iii)  "Excluded Person" shall mean any of (A) Charles M. Hansen,
Jr., Mary R. Silverthorne or the John H. Silverthorne Estate or any person for
which any of Charles M. Hansen, Jr., Mary R. Silverthorne or the John H.
Silverthorne Estate are deemed to hold beneficial ownership of securities of
Pillowtex registered in the name of such person; (B) Pillowtex; (C) any entity
in which Pillowtex directly or indirectly owns 50% or more of the outstanding
Voting Stock (a "Subsidiary"); or (D) any employee benefit plan sponsored by
Pillowtex or any Subsidiary.

               (iv)   "Good Reason" shall mean termination of Employee's
employment by Employee after a Change in Control of Pillowtex or Employer upon
the occurrence of any of the following:

                      (A)  the assignment to Employee of any duties inconsistent
with Employee's position, duties and status with Employer as existing
immediately prior to a Change in Control of Pillowtex or Employer; a substantial
alteration in the nature or status of Employee's responsibilities from those in
effect immediately prior to a Change in Control of Pillowtex or Employer; the
failure to provide Employee with substantially the same perquisites which
Employee had immediately prior to a Change in Control of Pillowtex or Employer,
including but not limited to an office and appropriate support services; or a
change in Employee's titles or offices as in effect

                                       6
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immediately prior to a Change in Control of Pillowtex or Employer, or any
removal of Employee from or failure to re-elect Employee to any such positions;

                      (B)  a reduction by Employer in Employee's base salary in
effect immediately prior to a Change in Control of or Pillowtex or Employer;

                      (C)  the requirement by Employer that Employee be based
anywhere other than the metropolitan area in which Employee's office is located
immediately prior to a Change in Control of Pillowtex or Employer, except for
required travel on Employee's business to an extent substantially consistent
with Employee's business travel obligations immediately prior to a Change in
Control of Pillowtex or Employer; or

                      (D)  the taking of any action by Employer which would (1)
materially and adversely affect Employee's participation in or materially reduce
Employee's benefits under any employee benefit or compensation plan in which
Employee participates immediately prior to a Change in Control of Pillowtex or
Employer, or (2) deprive Employee of any material fringe benefit enjoyed by
Employee, or to which Employee is entitled, as existing immediately prior to a
Change in Control of Pillowtex or Employer

               (v)    "Permanent Disability" shall mean any physical or mental
impairment rendering Employee unable to perform the essential functions of
Employee's job (as determined by Employer), with or without reasonable
accommodation that does not constitute undue hardship to Employer, and such
impairment is permanent or is likely to continue for a period exceeding six
consecutive months.  If Employee fails to notify Employer of Employee's need for
accommodation, Employer is not required to accommodate Employee and may hold
Employee to the same standards as persons without a disability.  The
determination of whether Employee has a Permanent Disability shall be made as
set forth below.  During any period in which the existence of a Permanent
Disability

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is being determined, Employee shall continue to receive Employee's full base
salary at the rate then in effect and all compensation and benefits paid during
such period until a Permanent Disability is conclusively determined and this
Agreement is terminated in accordance with Section 8 hereof, provided Employee
(and Employee's personal and legal representatives) act in good faith and with
reasonable diligence in pursuing a determination. This definition is not
intended to either expand or limit any rights and protections granted to
Employee by law. Employer may require Employee to be examined by a physician, at
Employee's own expense, in order to determine whether Employee has a Permanent
Disability. If Employer disagrees with the written opinion of this physician
("First Physician"), it may engage, at its own expense, another physician
("Second Physician") to examine Employee. If the First and Second Physicians
agree in writing that Employee has not suffered a Permanent Disability, their
written opinion shall, except as otherwise set forth in this Section 4(g)(v), be
conclusive on the issue of Permanent Disability. If the First and Second
Physicians disagree on whether Employee has suffered a Permanent Disability,
they shall choose a third consulting physician (whose expense shall be shared
equally by Employer and Employee) and the written opinion of a majority of these
three physicians shall be conclusive as to the issue of Permanent Disability. In
connection with a Permanent Disability determination, Employee hereby consents
to any required medical examination and agrees to furnish any medical
information requested by any examining physician and to waive any applicable
physician-patient privilege that may arise because of such examination. All
physicians must be board certified in the specialty most closely related to the
nature of the Permanent Disability alleged to exist.

               (vi)   "Retirement" shall mean termination by Employer or
Employee in accordance with Employer's retirement policy (including early
retirement, if included in such policy and elected by Employee in writing)
generally applicable to its senior executive employees, or in

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accordance with any other retirement agreement entered into by and between
Employee and Employer.

     5.   Compensation Upon Termination.  If Employee's employment is terminated
          -----------------------------
during the Term of this Agreement, Employee shall be entitled to compensation as
set forth below:

          (a)  If Employer terminates Employee's employment for Cause, Employer
shall pay Employee's undiscounted base salary through the date of Employee's
termination at the rate then in effect and all amounts to which Employee is
entitled upon termination of employment under Employer's employee benefit plans.

          (b)  If Employer terminates Employee's employment without Cause, then
Employer shall pay Employee, not later than the fifth day following the date of
termination, a severance payment equal to the sum of (i) Employee's undiscounted
base salary through the date of Employee's termination at the rate then in
effect and all amounts to which Employee is entitled upon termination of
employment under Employer's employee benefit plans; and (ii) Employee's
undiscounted base salary through the remaining duration of the Term or, if
greater, for a period of 24 months, at the highest rate in effect during the 12
months immediately preceding the date of Employee's termination.  The severance
payment provided for in clause (ii) of the first sentence of this Section 5(b)
shall be paid, at the option of the Employer, either in a lump sum or in equal
installments during the severance period in accordance with Employer's customary
pay practices. Notwithstanding the foregoing, the provisions of this Section
5(b) shall not apply if Employer terminates Employee's employment without Cause
subsequent to a Change in Control of Employer.

          (c)  If Employee's employment is terminated upon Employee's Permanent
Disability, Employer shall pay Employee's undiscounted base salary through the
date of Employee's termination at the rate then in effect and all amounts to
which Employee is entitled upon termination

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of employment under Employer's employee benefit plans. Employee's additional
compensation and benefits, if any, shall be determined in accordance with
Employer's employee benefit plans or other insurance programs then in effect.

          (d)  If Employee's employment is terminated upon Employee's
Retirement, Employer shall pay Employee's undiscounted base salary through the
date of Employee's termination at the rate then in effect and all amounts to
which Employee is entitled upon termination of employment under Employer's
employee benefit plans. Employee's additional compensation and benefits shall be
determined in accordance with Employer's retirement policy applicable to
similarly situated executive employees or in accordance with any other
retirement agreement entered into by and between Employee and Employer.

          (e)  If, at any time within two (2) years after the effective date of
a Change in Control of Pillowtex or Employer, Employee's employment (x) is
terminated by Employee for any reason during a period of six months beginning on
the date of the Change in Control of Pillowtex or Employer, or if less, during
the remaining duration of the Term; (y) is terminated by Employee for Good
Reason; or (z) is terminated by Employer without Cause (and not by reason of
Employee's Permanent Disability Retirement, or death), Employee shall be
entitled to the compensation and benefits provided below:

               (i)    Employer shall pay Employee's undiscounted base salary
through the date of Employee's termination at the rate then in effect;

               (ii)   Employer shall pay all amounts to which Employee is
entitled upon termination of employment under Employer's employee benefit plans;

               (iii)  Employer shall pay as severance pay to Employee, not later
than the fifth day following Employee's termination, a lump sum severance
payment (together with the

                                       10
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payments described in Sections 5(e)(iv) and (v), the "Severance Payments") equal
to the product obtained by multiplying Employee's undiscounted annual base
salary at the highest rate in effect during the 12 months immediately preceding
Employee's termination by two;

               (iv)   in lieu of shares of common stock, $0.01 par value, of
Pillowtex (the "Shares") issuable upon the exercise of options ("Options"), if
any, granted to Employee under any stock option plan of Pillowtex (which Options
shall be canceled upon the making of the payment referred to below), Employer
shall pay Employee in one sum in cash, not later than the fifth day following
the date of Employee's termination, an aggregate amount equal to the product of
(A) the difference (to the extent that such differences are a positive number)
obtained by subtracting the per Share exercise price of each Option held by
Employee, whether or not then fully exercisable, from the higher of (1) the
closing price of the Shares, as reported on the New York Stock Exchange on the
Date of Termination (or the last trading date prior thereto) or (2) the highest
price per Share actually paid in connection with any Change in Control of
Pillowtex or Employer, and (B) the number of shares covered by each such Option;

               (v)    Employer shall pay Employee the retirement benefits to
which Employee is entitled under Employee's retirement policy or other
retirement agreement;

               (vi)   Employer shall reimburse Employee for all legal fees and
expenses incurred by Employee as a result of such termination (including all
such fees and expenses, if any, incurred in successfully contesting or disputing
any such termination or seeking to obtain or enforce any right or benefit
provided by this Agreement); and

               (vii)  if Severance Payments become subject to the excise tax
(the "Excise Tax") imposed under section 4999 of the Internal Revenue Code of
1986, as amended (the "Code"), Employer shall pay to Employee an additional
amount (the "Gross-Up Payment") such that the net

                                       11
<PAGE>

amount retained by Employee, after deduction of any Excise Tax on the Severance
Payments (and any federal, state and local income tax and Excise Tax upon the
payment provided for in this Section 5(e)(vii)), shall be equal to the Severance
Payments. For purposes of determining whether any of the Severance Payments will
be subject to the Excise Tax and the amount of such Excise Tax, (A) any other
payment or benefit received or to be received by Employee in connection with a
Change in Control of Employer and Employee's subsequent termination of
employment (whether pursuant to the terms of this Agreement or any other plan,
arrangement or agreement with Employer, any person whose actions resulted in the
Change in Control of Employer or any person affiliated with Employer or such
person) shall be treated as a "parachute payment" within the meaning of section
280G(b)(2) of the Code, and all "excess parachute payments" within the meaning
of section 280G(b)(1) of the Code shall be treated as subject to the Excise Tax,
unless in the opinion of tax counsel selected by Employer's independent auditors
and reasonably acceptable to Employee such other payments or benefits (in whole
or in part) do not constitute parachute payments, (B) the amount of the
Severance Payments which shall be treated as subject to the Excise Tax shall be
equal to the lesser of (1) the total amount of the Severance Payments and (2)
the amount of excess parachute payments within the meaning of section
280(G)(b)(1) of the Code (after applying clause (A) above), and (C) the value of
any non-cash benefit, deferred payment or other benefit shall be determined by
Employer's independent auditors in accordance with the principles of sections
280(G)(d)(3) and (4) of the Code and the applicable Treasury Regulations. For
purposes of determining the amount of the Gross-Up Payment, Employee shall be
deemed to pay federal income taxes at the highest marginal rate of federal
income taxation in the calendar year in which the Gross-Up Payment is to be made
and state and local income taxes at the highest marginal rate of taxation in the
state and locality of Employee's residence on the date of Employee's
termination, net of the maximum reduction in

                                       12
<PAGE>

federal income taxes which could be obtained from deduction of such state and
local taxes. If the Excise Tax is subsequently determined to be less than the
amount taken into account hereunder at the time of Employee's termination of
employment, Employee shall repay to Employer, at the time that the amount of
such reduction in Excise Tax is finally determined, the portion of the Gross-Up
Payment attributable to such reduction (plus that portion of the Gross-Up
Payment attributable to the Excise Tax and federal, state and local income tax
imposed on the Gross-Up Payment being repaid by Employee to the extent that such
repayment results in a reduction in Excise Tax and/or a federal, state or local
income tax deduction) plus interest on the amount of such repayment at the rate
provided in section 1274(b)(2)(B) of the Code. If the Excise Tax is determined
to exceed the amount taken into account hereunder at the time of the termination
of Employee's employment (including by reason of any payment the existence or
amount of which cannot be determined at the time of the Gross-Up Payment),
Employer shall make an additional Gross-Up Payment in respect of such excess
(plus any interest, penalties or additions payable by Employee with respect to
such excess) at the time that the amount of such excess is finally determined.
Employee and Employer shall each reasonably cooperate with the other in
connection with any administrative or judicial proceedings concerning the
existence or amount of liability for Excise Tax with respect to the Severance
Payments.

          (f)  If Employee terminates Employee's employment under circumstances
in which Section 5(e) does not apply, or if Employee's employment is terminated
by reason of his death, Employer shall pay Employee's full base salary through
the date of Employee's termination at the rate then in effect and all amounts to
which Employee is entitled upon termination of employment under Employer's
employee benefit plans.

     6.   Insurance. If Employee's employment is terminated under the provisions
          ---------
of Section 4(e) of this Agreement, Employee shall participate, for a period of
two years from the date

                                       13
<PAGE>

of Employee's termination, in all employee benefit plans providing health and
dental benefits in which Employee participated or was entitled to participate
immediately prior to Employee's termination, provided that such participation is
permitted under the general terms and provisions of such plans and under
applicable law. If Employee's participation in any such plan is not permitted
for any reason, Employer shall arrange to provide Employee, at Employer's sole
cost and expense, with benefits substantially similar to those which Employee is
entitled to receive under such plans. At the end of such two year period,
Employee will be entitled to take advantage of any conversion privileges
applicable to the benefits available under any such plans.

     7.   Future Employment.  Employee shall not be required to mitigate the
          -----------------
amount of any payment provided for in Section 5 hereof by seeking other
employment or otherwise, nor shall the amount of any payment provided for in
Section 5 hereof be reduced by any compensation earned by Employee as a result
of employment by another employer after the date of Employee's termination, or
otherwise.

     8.   Notice of Termination.
          ---------------------

          (a)  Any purported termination by Employer or by Employee shall be
communicated by a written "Notice of Termination" to the other party.  A Notice
of Termination shall mean a notice indicating the specific termination provision
in this Agreement relied upon and setting forth in reasonable detail the facts
and circumstances claimed to provide a basis for termination of Employee's
employment under the provision so indicated.

          (b)  The "date of Employee's termination" shall be:  (i) if Employee's
employment is terminated by reason of Employee's Permanent Disability, the date
that is 30 days after the determination of Permanent Disability pursuant to
Section 4(g)(v) of this Agreement, (ii) if Employee's employment is terminated
for Cause, the date specified in the Notice of Termination, or

                                       14
<PAGE>

(iii) if Employee's employment is terminated for any other reason, the date
specified in the Notice of Termination, provided such date is not more than 30
days from the date such Notice of Termination is given.

     9.   Arbitration. All disputes or claims arising under this Agreement or in
          -----------
connection with Employee's employment with Employer (including any claims under
any federal, state, or local law or ordinance), except for any dispute or claim
arising under Sections 10, 11, 12, 13, and 16 of this Agreement, shall be
subject to binding arbitration pursuant to the Commercial Arbitration Rules of
the American Arbitration Association, the cost of which shall be borne by the
party against whom an arbitration award is entered.

     10.  Nondisclosure Agreement.  Employer, during the term of Employee's
          -----------------------
employment under this Agreement, shall provide Employee access to, and Employee
shall have access to and become familiar with, various trade secrets and
proprietary and confidential information consisting of, but not limited to,
financial statements, processes, computer programs, compilations of information,
records, sales procedures, customer requirements, pricing techniques, customer
lists, methods of doing business and other confidential information
(collectively referred to herein as the "Trade Secrets"), which are owned by
Employer and its affiliates and are regularly used in the operation of their
businesses, but in connection with which Employer and its affiliates take
precautions to prevent dissemination to persons other than certain directors,
officers and employees.  Employee acknowledges and agrees that the Trade Secrets
(a) are secret and not known in Employer's industry; (b) are entrusted to
Employee after being informed of their confidential and secret status by
Employer or its affiliates and because of the fiduciary position occupied by
Employee with Employer; (c) have been developed by Employer and its affiliates
for and on behalf of Employer and its affiliates through substantial
expenditures of time, effort and money and are used in their

                                       15
<PAGE>

businesses; (d) give Employer and its affiliates an advantage over competitors
who do not know or use the Trade Secrets; (e) are of such value and nature as to
make it reasonable and necessary to protect and preserve the confidentiality and
secrecy of the Trade Secrets; and (f) are valuable, special and unique assets of
Employer and its affiliates, the disclosure of which could cause substantial
injury and loss of profits and goodwill to Employer and its affiliates. Employee
shall not use in any way or disclose any of the Trade Secrets, directly or
indirectly, either during the Term of this Agreement or at any time thereafter,
except as required in the course of Employee's employment under this Agreement.
All files, records, documents, information, data and similar items relating to
the business of Employer and its affiliates, whether prepared by Employee or
otherwise coming into Employee's possession, shall remain the exclusive property
of Employer and its affiliates and shall not be removed from the premises of
Employer and its affiliates under any circumstances without the prior written
consent of the Board of Directors of Employer (except in the ordinary course of
business during Employee's period of active employment under this Agreement),
and in any event shall be promptly delivered to Employer upon termination of
this Agreement. Employee agrees that upon Employee's receipt of any subpoena,
process or other request to produce or divulge, directly or indirectly, any
Trade Secrets to any entity, agency, tribunal or person, Employee shall timely
notify and promptly hand deliver a copy of the subpoena, process or other
request to the Chief Executive Officer of Pillowtex. For this purpose, Employee
irrevocably nominates and appoints Employer (including any attorney retained by
Employer), as Employee's true and lawful attorney-in-fact, to act in Employee's
name, place and stead to perform any act that Employee might perform to defend
and protect against any disclosure of any Trade Secrets.

                                       16
<PAGE>

     As used in this Agreement, "affiliates" shall mean persons or entities that
directly, or indirectly through one or more intermediaries, control or are
controlled by, or are under common control with, Employer.

     11.  Intentionally Omitted.

     12.  Nonemployment Agreement.  During the period of employment with
          -----------------------
Employer and for a period of two years thereafter, Employee shall not, on
Employee's own behalf or on behalf of any other person, partnership,
association, corporation or other entity, hire or solicit or in any manner
attempt to influence or induce any employee of Employer or its affiliates to
leave the employment of Employer or its affiliates, nor shall Employee use or
disclose to any person, partnership, association, corporation or other entity
any information obtained while an employee of Employer concerning the names and
addresses of the employees of Employer or its affiliates.

     13.  Nondisparagement Agreement.  Employee shall not, either during the
          --------------------------
Term of this Agreement or at any time thereafter, make statements, whether
orally or in writing, concerning Employer, any of its directors, officers,
employees or affiliates or any of its business strategies, policies or
practices, that shall be in any way disparaging, derogatory or critical, or in
any way harmful to the reputation of Employer, any such persons or entities or
business strategies, policies or practices.

     14.  Successors; Binding Agreement.
          -----------------------------

          (a)  Employer will require any successor (whether direct or indirect,
by purchase, merger, consolidation or otherwise) to all or substantially all of
the business and/or assets of Employer, by agreement in form and substance
satisfactory to Employee, to expressly assume and agree to perform this
Agreement in the same manner and to the same extent that Employer would be
required to perform it if no such succession had taken place.  Failure of
Employer to obtain such

                                       17
<PAGE>

agreement prior to the effectiveness of any succession shall be a breach of this
Agreement and shall entitle Employee to compensation from Employer in the same
amount and on the same terms as Employee would be entitled hereunder if Employee
terminated Employee's employment for Good Reason, except that for purposes of
implementing the foregoing, the date on which any such succession becomes
effective shall be deemed the date of Employee's termination. As used in this
Agreement, "Employer" shall mean Employer as hereinbefore defined and any
successor to its business and/or assets as aforesaid which executes and delivers
the agreement provided for in this Section 14 or which otherwise becomes bound
by all the terms and provisions of this Agreement by operation of law or
otherwise.

          (b)  This Agreement shall inure to the benefit of and be enforceable
by Employee's personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees. In the event of
Employee's death, any amounts owed to Employer under this Agreement shall be
paid to Employee's surviving spouse, if any, and if none, to Employee's estate.

     15.  Severability.  The parties hereto intend all provisions of Sections
          ------------
10, 11, 12, 13 and 16 hereof to be enforced to the fullest extent permitted by
law.  Accordingly, should a court of competent jurisdiction determine that the
scope of any provision of Sections 10, 11, 12, 13 and 16 hereof is too broad to
be enforced as written, the parties intend that the court reform the provision
to such narrower scope as it determines to be reasonable and enforceable.  In
addition, however, Employee agrees that the provisions of each of the foregoing
sections constitute separate agreements independently supported by good and
adequate consideration and shall be severable from the other provisions of, and
shall survive, this Agreement.  The existence of any claim or cause of action of
Employee against Employer, whether predicated on this Agreement or otherwise,
shall not constitute a defense to the enforcement by Employer of the covenants
and agreements of Employee contained

                                       18
<PAGE>

in the non-competition, nondisclosure, nonemployment or nondisparagement
agreements. If any provision of this Agreement is held to be illegal, invalid or
unenforceable under present or future laws effective during the term hereof,
such provision shall be fully severable and this Agreement shall be construed
and enforced as if such illegal, invalid or unenforceable provision 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 therefrom.
Furthermore, in lieu of such illegal, invalid or unenforceable provision, there
shall be added automatically as part of this Agreement, a provision as similar
in its terms to such illegal, invalid or unenforceable provision as may be
possible and be legal, valid and enforceable.

     16.  Inventions.  Employee shall promptly disclose, grant and assign to
          ----------
Employer for its sole use and benefit any and all inventions, improvements,
technical information and suggestions relating in any way to the products of
Employer or any of its affiliates or capable of beneficial use by Employer or
any of its affiliates, which Employee has in the past conceived, developed or
acquired, or may conceive, develop or acquire during the term hereof (whether or
not during usual working hours), together with all patent applications, letters
patent, copyrights and reissues thereof that may at any time be granted upon any
such invention, improvement or technical information.  In connection therewith,
Employee shall promptly at all times during and after the term hereof:

          (a)  execute and deliver such applications, assignments, descriptions
and other instruments as may be necessary or proper in the opinion of Employer
to vest title to such inventions, improvements, technical information, patent
applications and patents or reissues thereof in Employer and to enable it to
obtain and maintain the entire right and title thereto throughout the world; and

          (b)  render to Employer, at its expense, all such assistance as it may
require in the prosecution of applications for said patents or reissues thereof,
in the prosecution or defense of

                                       19
<PAGE>

interferences which may be declared involving any said application or patents
and in any litigation in which Employer or its affiliates may be involved
relating to any such patents, inventions, improvements or technical information.

     17.  Affiliates.  Employee will use Employee's best efforts to ensure that
          ----------
no relative of his or corporation of which Employee is an officer, director or
shareholder, or other affiliate of his, shall take any action that Employee
could not take without violating any provision of this Agreement.

     18.  Remedies.  Employee recognizes and acknowledges that the ascertainment
          --------
of damages in the event of his breach of any provision of this Agreement would
be difficult, and Employee agrees that Employer, in addition to all other
remedies it may have, shall have the right to injunctive relief if there is such
a breach.

     19.  Notices.  Any notices, consents, demands, requests, approvals and
          -------
other communications to be given under this Agreement by either party to the
other shall be in writing and shall be either (i) delivered in person, (ii)
mailed by registered or certified mail, return receipt requested, postage
prepaid, (iii) delivered by overnight express delivery service or same-day local
courier service or (iv) delivered by facsimile transmission, to the addresses
set forth below.

          If to Employer:  Fieldcrest Cannon, Inc.
                           4111 Mint Way
                           Dallas, Texas  75237
                           Attention:  President and Chief Operating Officer
                           Facsimile No. (214) 339-8565

          If to Employee:  Richard A. Grissinger
                           18703 Headsail Court
                           Cornelius, North Carolina 28031

Notices delivered personally, by overnight express delivery, local courier or
facsimile shall be deemed communicated as of actual receipt; mailed notices
shall be deemed communicated as of three days after mailing.

                                       20
<PAGE>

     20.  Entire Agreement.  This Agreement supersedes any and all other
          ----------------
agreements, either oral or written, between the parties hereto with respect to
the subject matter hereof, including, without limitation, that certain Employee
Retention Agreement between Employee and Employer, and contains all of the
covenants and agreements between the parties with respect thereto.

     21.  Modification.  No change or modification of this Agreement shall be
          ------------
valid or binding upon the parties hereto, nor shall any waiver of any term or
condition in the future be so binding, unless such change or modification or
waiver shall be in writing and signed by the parties hereto.

     22.  GOVERNING LAW AND VENUE.  THE PARTIES ACKNOWLEDGE AND AGREE THAT THIS
          -----------------------
AGREEMENT AND THE OBLIGATIONS AND UNDERTAKINGS OF THE PARTIES HEREUNDER WILL BE
PERFORMABLE IN KANNAPOLIS, NORTH CAROLINA. THIS AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NORTH CAROLINA.  IF
ANY ACTION IS BROUGHT TO ENFORCE OR INTERPRET THIS AGREEMENT, VENUE FOR SUCH
ACTION SHALL BE IN CARRABUS COUNTY, NORTH CAROLINA.  EACH OF THE PARTIES HERETO
HEREBY AGREES IRREVOCABLY AND UNCONDITIONALLY TO CONSENT TO SUBMIT TO THE
EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NORTH CAROLINA AND OF THE
UNITED STATES OF AMERICA LOCATED IN CHAROLETTE, NORTH CAROLINA FOR ANY ACTIONS,
SUITS OR PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT AND FURTHER
AGREES THAT SERVICE OF PROCESS, SUMMONS OR NOTICE BY U.S. REGISTERED MAIL TO THE
APPLICABLE ADDRESSES SET FORTH IN SECTION 19 HEREIN SHALL BE EFFECTIVE SERVICE
OF PROCESS OF ANY ACTION, SUIT OR PROCEEDING BROUGHT AGAINST SUCH PARTY IN ANY
SUCH COURT.

                                       21
<PAGE>

     23.  Counterparts.  This Agreement may be executed in counterparts, each of
          ------------
which shall constitute an original, but all of which shall constitute one
document.

     24.  Costs.  If any action or law or in equity is necessary to enforce or
          -----
     interpret the terms of this Agreement, the prevailing party shall be
     entitled to reasonable attorneys' fees, costs and necessary disbursements
     in addition to any other relief to which Employee or it may be entitled.

     25.  Assignment.  Employer shall have the right to assign this Agreement to
          ----------
its successors or assigns.  The terms "successors" and "assigns" shall include
any person, corporation, partnership or other entity that buys all or
substantially all of Employer's assets or all of its stock, or with which
Employer merges or consolidates.  The rights, duties and benefits to Employee
hereunder are personal to Employee, and no such right or benefit may be assigned
by Employee.

     26.  Binding Effect.  This Agreement shall be binding upon the parties
          --------------
hereto, together with their respective executors, administrators, successors,
personal representatives, heirs and assigns.

     27.  No Waiver.  The failure by Employer to enforce at any time any of the
          ---------
provisions of this Agreement or to require at any time performance by Employee
of any of the provisions hereof shall in no way be construed to be a waiver of
such provisions or to affect the validity of this Agreement, or any part hereof,
or the right of Employer thereafter to enforce each and every such provision in
accordance with the terms of this Agreement.

                                       22
<PAGE>

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

                                  FIELDCREST CANNON, INC.

                                  By:  Charles M. Hansen, Jr.
                                       Chairman and Chief Executive Officer

                                  EMPLOYEE

                                  Richard A. Grissinger

                                       23

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