GUARANTY AGREEMENT
THIS GUARANTY AGREEMENT (this 'Guaranty'), dated as of April 22, 1997, is
by and between Pillowtex Corporation, a Texas corporation ('Guarantor'), and
[ ] ('Employee').
RECITALS
WHEREAS, Pillowtex Management Services Company, a Delaware business trust
('Management'), and Employee entered into that certain Employment Agreement
dated as of April 22, 1997 (the 'Employment Agreement'); and
WHEREAS, in order to induce Employee to enter into the Employment
Agreement, Guarantor has agreed to make and deliver this Guaranty to secure the
payment and performance of all obligations of Management under the Employment
Agreement.
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, Guarantor hereby agrees as follows:
1. Guarantor hereby primarily, unconditionally and absolutely guarantees
to Employee that Management (i) shall fully and punctually pay, as and when due,
all amounts required to be paid under the Employment Agreement, and (ii) shall
fully and punctually comply with and perform all of the other terms, covenants
and conditions to be complied with or performed by Management under the
Employment Agreement;
2. If Management fails or refuses to timely pay any amounts when due
under the Employment Agreement or fails to comply with or perform any or all of
the other terms, covenants and conditions of the agreement, then Guarantor (i)
shall fully and punctually pay all of the amounts which Management owes Employee
and refuses to pay and shall comply with and perform the other terms, covenants
and conditions which Management has refused or failed to comply with or perform
and Employee's reasonable attorneys' fees and all court costs incurred by
Employee in enforcing or protecting any of Employee's rights, remedies or
recourse hereunder, or under the agreement, and (ii) shall reimburse Employee
for all damages actually suffered by Employee as a result of Management's
failure to perform any terms, covenants and conditions of the agreement, all
without cost or expense to Employee;
3. The liability of the Guarantor for the payment or performance, when
due, of its obligations under this Guaranty shall be primary and not secondary;
4. Guarantor waives any and all legal requirements that Employee
institute any action or proceeding, at law or in equity, or exhaust its rights,
remedies and recourse against Management or anyone else with respect to the
Employment Agreement, as a condition precedent to bringing an action upon this
Guaranty. Employee may simultaneously maintain an action upon this Guaranty and
an action or proceeding against Management upon the agreement. Guarantor
further waives any requirements that Employee demand payment or performance from
or seek payment or performance by Management or any other party of the amounts
owing to Employee or the provisions of the agreement to be performed by
Management as a condition precedent to bringing any action against the Guarantor
upon this Guaranty, it being agreed that a failure by Management to pay any
amount or to perform any obligation herein guaranteed shall, without further
act, make Guarantor liable as herein set forth. All remedies afforded to
Employee, by reason of this Guaranty and the agreement, are separate and
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cumulative remedies, and no one of such remedies, whether exercised by Employee
or not, shall be deemed an exclusion of any other remedies available to Employee
at law or in equity, by statute, under the agreement, or otherwise, and shall in
no way limit or prejudice any such other remedies which Employee may have;
5. Guarantor waives any defense arising by virtue of any disability,
insolvency, lack of authority or power, death, insanity, incompetence, minority,
liquidation or dissolution of Management, even though rendering the actions
thereof or instruments executed thereby void, unenforceable or otherwise
uncollectible, it being agreed that Guarantor shall remain liable hereunder,
regardless of the above;
6. This Guaranty shall inure to the benefit of and be enforceable by
Employee's personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees;
7. If any provision of this Guaranty or the application thereof to any
person or circumstances shall for any reason and to any extent be invalid or
unenforceable, neither the remainder of this Guaranty nor the application of
such provisions to any other person or circumstance shall be affected thereby,
but rather the same shall be enforced to the greatest extent permitted by law;
and
8. In the event that Employee has to retain an attorney or go into court
in any suit or proceeding to collect under the terms of this Guaranty, Guarantor
shall pay on demand and be liable for all costs and expenses including
reasonable attorneys' fees thereby incurred.
IN WITNESS WHEREOF, the parties hereto have executed this Guaranty as of
the date first above written.
PILLOWTEX CORPORATION
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Xxxxxxx X. Xxxxxx, Xx.
Chairman of the Board and
Chief Executive Officer
EMPLOYEE
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[ ]
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