Exhibit 10(a)(16)
Letter Agreement dated March 20, 1995
[Letterhead of Texfi Industries, Inc.]
Mr. L. Xxxxxxx Xxxxx, Xx.
000 Xxxxx Xxxx Xxxxxx
Xxxxxxxxxxx, Xxxxx Xxxxxxxx 00000
You have requested that consideration be given to several matters relating to
your change of status. This letter will address those matters.
1. With reference to Section 6.2 of your Employment Agreement with Texfi
dated November 1, 1991, you have requested that the insurance policy
which was purchased by Texfi to fund in part the payments provided for
in that Section be assigned to you and that Texfi make monthly
payments, beginning at an early date, at the rate of $100,000 per year,
until such time as the total amount of these payments is equal to the
difference between the present value of the payments provided for in
Section 6.2 ($100,000 per year for ten years calculated as provided in
Section 6.2) and the cash value of the insurance policy being assigned
to you. You have also requested that an interest factor be included in
the monthly payments.
Our understanding of this arrangement is as follows:
(a) The present value the payment provided for in Section 6.2,
computed as provided in that Section as of March 13, 1995, is
$750,612.
(b) Texfi would assign to you Policy Number 2,364,024 issued by
Phoenix Mutual Life Insurance Company, which has a cash value
as of March 13, 1995 of $389,546. As you know, this policy is
now held by First Union National Bank as Trustee under a Trust
Agreement among you, Texfi and First Union dated November 1,
1987. It will be necessary for appropriate documentation to be
entered into among the parties to this Trust Agreement to
terminate the Agreement and release the policy to be assigned
to you.
(c) Texfi would pay to you each month beginning April 1,1995, the
sum of $8,333.33, which payments would continue until March 1,
1999, with a final payment of $7,954.95 on April 1, 1999, at
which time Texfi would have paid to you in the aggregate
$407,954.79. These payments represent the difference between
the present value of the payments provided in Section 6.2 and
the cash value of the insurance policy being assigned to you
(such difference being $361,066), plus an interest factor of
$46,888.79.
Mr. L. Xxxxxxx Xxxxx, Xx.
March 20, 1995
Page 2
(d) It appears that both the assignment of the insurance policy as
provided in (b) above and payment of the amounts provided for
in (c) above will be subject to withholding taxes.
2. The furniture and equipment now located in your office in Spartanburg,
listed on the attached schedule, will be sold to you for $2,500.
3. Texfi has delivered to you certificates evidencing 11,762 share of
common stock that are restricted pursuant to the terms of the 1990
Restricted Incentive Stock Plan of the Company. In order to remove
these restrictions, it is necessary that the Board of Directors approve
your early retirement in order that your retirement would be deemed as
"Approved Retirement" as defined in Section 1.01 of that plan. The
Board of Directors has taken the necessary action in this regard,
subject to a mutual agreement having been reached with regard to the
other matters outlined in this letter.
4. It will be satisfactory for your 1994 income tax return to be prepared
by Xxxxxx & Xxxxx at the Company's expense. Xxxxxx & Young has advised
us that the cost of preparation of these returns will not exceed
$1,900.
If the foregoing is in accordance with your understanding, please sign and
return to me the enclosed copy of this letter. We will then proceed with actions
necessary to implement our agreement as set forth in this letter.
Sincerely,
/s/ Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx
Vice Chairman and Chief Executive Officer
Read and agreed to:
/s/ L. Xxxxxxx Xxxxx, Xx.
L. Xxxxxxx Xxxxx, Xx.
Dated: 3/27/95
Mr. L. Xxxxxxx Xxxxx, Xx.
March 20, 1995
Page 3
ASSETS TO BE TRANSFERRED TO XXXXXXX XXXXX BY TEXFI INDUSTRIES
FAS # Description Acquisition Date
----- ----------- ----------------
05640 Ricoh 120EN Fax Machine March 1, 1989
06917 Chair January 1, 1992
06918 Chair January 1, 1992
06919 Chair January 1, 1992
06920 Chair January 1, 1992
06921 Chair January 1, 1992
06922 Chair January 1, 1992
06923 Chair January 1, 1992
06924 Chair January 1, 1992
06925 Chair January 1, 1992
06926 Chair January 1, 1992
06927 Chair January 1, 1992
06928 48" by 96" Walnut Table January 1, 1992
06929 12' by 48" Blackboard January 1, 1992
06930 Conference Room Renovation January 1, 1992
06931 Speaker Telephone January 1, 1992
07112 Okidata L400 Laser Printer February 1, 1993
07113 000/00 00 XXX XX with modem February 1, 1993
