Employment Agreement (2002)Full Document 

Start of Preview
         THIS AGREEMENT, dated as of the 24/th/ day of May, 2002 (but effective
as of the date set forth in Section 1.11), is entered into by and between
Pillowtex Corporation, a Delaware corporation (the "Company"), and A. Allen
Oakley ("Employee").

         WHEREAS, the Company and Employee have previously entered into that
certain Employment Agreement, dated as of April 1, 2001 (the "Prior Agreement");

         WHEREAS, the Company is a debtor in a bankruptcy case (the "Bankruptcy
Proceedings") under Chapter 11 of the United States Bankruptcy Code, Case Number
00-4211, pending in the United States Bankruptcy Court for the District of
Delaware (the "Court"); and

         WHEREAS, the Company has previously implemented the KERP (as defined
below) pursuant to an order Authorizing Debtors and Debtors in Possession to
Implement Key Employee Retention Program and Severance Plan issued by the Court
on March 6, 2001 (the "Order"); and

         WHEREAS, the Company and Employee desire to provide for certain rights
and responsibilities of each party in connection with the future employment of
the Employee including certain rights of the parties in the event of the
termination of the employment of the Employee with the Company; and, the parties
desire that this Agreement will supercede the Prior Agreement.

         NOW THEREFORE, in consideration of the mutual covenants contained
herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, it is agreed as follows:

                                   ARTICLE 1

         The following terms will have the respective meanings set forth below,
unless the context clearly otherwise requires:

         1.1 "Affiliate" shall mean, with respect to the Company, any person or
entity that directly, or indirectly through one or more intermediaries,
controls, is controlled by, or is under common control with, the Company.

         1.2 "Bankruptcy Proceeding" shall have the meaning ascribed to such
term in the second premise of this Agreement.

         1.3 "Board" shall mean the Board of Directors of the Company.

         1.4 "Cause" shall mean the occurrence of any of the following: (a)
Employee engaging in any personal misconduct involving willful dishonesty,
illegality, or moral turpitude that is detrimental or injurious to the business
interests, reputation or goodwill of the Company

or its Affiliates; (b) Employee engaging in any act involving willful
dishonesty, disloyalty, or infidelity against the Company or its Affiliates; (c)
an act of fraud, embezzlement or theft in connection with the Employee's duties
or in the course of his employment with the Company; (d) Employee's breach of or
failure substantially to perform under any of the material terms and covenants
of this Agreement; or (e) the death, disability or retirement of Employee. For
purposes of this Section 1.4, no act, or failure to act, on Employee's part will
be considered "willful" unless done, or omitted to be done, by Employee without
reasonable belief that Employee's action or omission was in the best interest of
the Company. Prior to asserting any action or failure to act as Cause for
Employee's termination as set forth above, the Company will provide Employee a
written notice referencing this Section 1.4, setting out with specificity the
conduct asserted to constitute Cause and, if the conduct asserted to constitute
Cause is described in clause (d) of the first sentence of this Section 1.4,
providing Employee with a reasonable opportunity of not less than ten (10) days
to cure or cease and desist such conduct; provided, however, Employee will not
be provided any opportunity to cure such conduct more than twice while this
Agreement is in effect.

     1.5  Reserved

     1.6  "Code" shall mean the Internal Revenue Code of 1986, as amended.

     1.7  "Company" shall have the meaning ascribed to such term in the first
paragraph of this Agreement.

     1.8  "Confidential Information" shall mean any and all technical and
non-technical information disclosed by the Company pursuant to or in
contemplation of this Agreement, including Trade Secrets and proprietary
information, techniques, sketches, drawings, models, inventions, know-how,
processes, apparatus, equipment, algorithms, software programs, software source
documents and formulae related to the current, future and proposed products and
services of the Company and/or the Company's parents, subsidiaries, customers
and/or vendors, whether delivered in written (or other tangible) form, and
includes, without limitation, information concerning design details and
specifications, financial data, procurement requirements, customer lists,
business forecasts and purchasing, manufacturing, sales, merchandising,
development, engineering and marketing plans. Without limiting the generality of

End of Preview