<PAGE>
FORM 11K
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
ANNUAL REPORT
Pursuant to Section 15(d) of the Securities Exchange Act of 1934
For the period from January 1, 1995 to December 31, 1995
COMMISSION FILE NO. 0-12781
A. Full title of the plan and the address of the plan, if
different from that of the issuer named below:
CULP, INC. EMPLOYEES' RETIREMENT BUILDER PLAN
B. Name of issuer of the securities held pursuant to the plan
and the address of its principal executive office:
CULP, INC.
101 SOUTH MAIN STREET
P.O. BOX 2686
HIGH POINT, NORTH CAROLINA 27261-2686
There were no material changes in the Plan or the Investment
Policy of the Plan. Culp, Inc. has made no profit sharing contributions during
the past five years. The approximate number of employees participating in the
Plan at December 31, 1995 was 2,045. The Retirement Committee administers
the Plan, and its members are Franklin N. Saxon, Kenneth M. Ludwig and Robert
G. Culp, III, all employees of Culp, Inc.
Financial Statements and Exhibits.
(a) Financial Statements. A list of all financial statements
filed as part of this report, beginning on page 1, is set forth below:
Financial Statement Page of Report
Report of Independent Auditors 1
Statements of Net Assets Available 2
for Plan Benefits
Statements of Changes in Net Assets 3
Available for Plan Benefits
Notes to Financial Statements 4
<PAGE>
(b) Exhibits. No exhibits are filed with this annual report.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the plan administrator has duly caused this annual report to be signed by the
undersigned thereunto duly authorized.
CULP, INC. EMPLOYEES' RETIREMENT BUILDER PLAN
By: Culp, Inc. Plan Administrator
By: The Culp, Inc. Retirement Committee
Date: June 26, 1996
Robert G. Culp, III
Franklin N. Saxon
Kenneth M. Ludwig
<PAGE>
(DIXON, ODOM & CO., L.L.P. LETTERHEAD)
INDEPENDENT AUDITORS' REPORT
To the Retirement Committee of the
Culp, Inc. Employees' Retirement Builder Plan
High Point, North Carolina
We have audited the accompanying statements of net assets available for plan
benefits of the Culp, Inc. Employees' Retirement Builder Plan as of December 31,
1995 and 1994 and the related statements of changes in net assets available for
plan benefits for each of the years in the three year period ended December 31,
1995. These financial statements are the responsibility of the Plan
Administrator. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of the Culp, Inc. Employees'
Retirement Builder Plan as of December 31, 1995 and 1994 and the changes in net
assets available for plan benefits for each of the years in the three year
period ended December 31, 1995 in conformity with generally accepted accounting
principles.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules presented on
pages 11 through 14 are presented for the purpose of additional analysis and are
not a required part of the basic financial statements. The supplemental
schedules on pages 11 and 12 are supplementary information required by the
Department of Labor's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974. The supplementary
information for the years ended December 31, 1995, 1994 and 1993 has been
subjected to the auditing procedures applied in the audits of the basic
financial statements and, in our opinion, is fairly stated, in all material
respects, in relation to the basic financial statements taken as a whole. The
supplementary information for the years ended December 31, 1991, 1990 and 1989
was audited by us and our report dated February 24, 1992 expressed an
unqualified opinion on such information in relation to the basic financial
statements for those years taken as a whole. The supplementary information for
the periods ended December 31, 1988 and prior were audited by other auditors
whose report dated April 7, 1989 expressed an unqualified opinion on such
information in relation to the basic financial statements for those periods
taken as a whole.
(Signature of Dixon, Odom & Co., L.L.P.)
MARCH 15, 1996
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Page 1
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CULP, INC. EMPLOYEES' RETIREMENT BUILDER PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
DECEMBER 31, 1995 AND 1994
<TABLE>
<CAPTION>
ASSETS 1995 1994
--------------- ----------
<S> <C> <C>
Investments, at fair value $ 16,746,261 $ 13,589,467
Receivables
Employer contributions 67,250 69,747
Employee contributions 160,890 166,447
--------------- ----------------
TOTAL ASSETS 16,974,401 13,825,661
LIABILITIES
Accounts payable 1,470 14,517
--------------- ----------------
NET ASSETS AVAILABLE
FOR PLAN BENEFITS $ 16,972,931 $ 13,811,144
=============== ================
</TABLE>
See accompanying notes. Page 2
<PAGE>
CULP, INC. EMPLOYEES' RETIREMENT BUILDER PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
<TABLE>
<CAPTION>
1995 1994 1993
-------------- -------------- ---------
<S> <C> <C> <C>
ADDITIONS TO NET ASSETS
ATTRIBUTED TO
Net income (loss) from investment in a
common trust $ 1,657,794 $ 353,139 $ 627,474
Appreciation (depreciation) in fair value of
Culp, Inc. Stock Fund 285,027 (909,365) 1,721,339
Dividend income from Culp, Inc. Stock Fund 25,344 14,684 10,821
Interest income from Culp, Inc. Stock Fund 194 5,629 2,643
Contributions
Employer 801,452 773,080 596,836
Employees 1,922,941 1,851,363 1,395,843
-------------- -------------- --------------
TOTAL ADDITIONS 4,692,752 2,088,530 4,354,956
-------------- -------------- --------------
DEDUCTIONS FROM NET
ASSETS ATTRIBUTED TO
Benefits paid to participants 1,459,844 1,074,390 926,870
Insurance 9,425 11,353 13,748
Trustee fees 61,696 67,014 68,921
-------------- -------------- --------------
TOTAL DEDUCTIONS 1,530,965 1,152,757 1,009,539
-------------- -------------- --------------
NET INCREASE 3,161,787 935,773 3,345,417
NET ASSETS AVAILABLE FOR
PLAN BENEFITS
Beginning of year 13,811,144 12,875,371 9,529,954
-------------- -------------- --------------
END OF YEAR $ 16,972,931 $ 13,811,144 $ 12,875,371
============== ============== ==============
</TABLE>
See accompanying notes. Page 3
<PAGE>
CULP, INC. EMPLOYEES' RETIREMENT BUILDER PLAN
NOTES TO FINANCIAL STATEMENTS
NOTE A - SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting
The financial statements of the Plan are prepared using the accrual method of
accounting.
Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires the plan administrator to make estimates and
assumptions that affect certain reported amounts and disclosures. Accordingly,
actual results may differ from those estimates.
Valuation of Investments
Investments in common trust funds are stated at fair value based on the values
of the respective instruments held by each fund as determined by the quoted
market prices on the last day of the plan year. Investments in common stocks are
stated at fair value as determined by the quoted market prices on the last day
of the plan year. The cost of securities sold is determined based on average
cost.
Allocated Insurance Contracts
Assets related to life insurance purchased through the Plan are excluded from
plan assets.
Other
Purchases and sales of investments are reported on a trade date basis. Income
from investments is reported as earned on the accrual basis.
NOTE B - DESCRIPTION OF PLAN
The following description of the Culp, Inc. Employees' Retirement Builder Plan
provides only general information. Participants should refer to the summary plan
description for a more complete description of the Plan's provisions.
General
The Plan is a defined contribution plan covering all full-time employees of
Culp, Inc. (the Company) and its subsidiaries who have one year of service and
are age twenty-one or older, except for hourly employees of Rossville/Chromatex
who are covered under a union benefit plan. It is subject to the provisions of
the Employee Retirement Income Security Act of 1974 (ERISA).
Page 4
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CULP, INC. EMPLOYEES' RETIREMENT BUILDER PLAN
NOTES TO FINANCIAL STATEMENTS
NOTE B - DESCRIPTION OF PLAN (Continued)
Contributions
The Plan was established in 1982 as a profit-sharing plan to which contributions
determined by the Board of Directors of Culp, Inc. could be made on a
discretionary basis. No profit-sharing contributions were made during 1995, 1994
or 1993.
In November 1986, the Plan was amended to include provisions for 401(k)
contributions and several related investment options. Participants may
contribute from 2% to 15% of their annual compensation as 401(k) contributions,
not to exceed a base limit of $9,240 in 1995, $9,240 in 1994, and $8,994 in
1993. The Company makes a matching contribution equal to 50% of the
participant's contribution up to the first 5% of annual compensation.
Participants may elect to have contributions invested in 25% increments in a
guaranteed insurance contract fund, a Culp, Inc. stock fund, a balanced fund, or
a value fund.
In addition to its contributions to the Plan, the Company paid administrative
expenses on behalf of the Plan which totaled $8,872 for the year ended December
31, 1995, $21,941 for the year ended December 31, 1994 and $15,128 for the year
ended December 31, 1993.
Participant Accounts
401(k) contributions are credited on a specific identification basis. Income of
the respective funds is allocated based on participants' account balances. Upon
retirement, death or termination, the participant or beneficiary may elect to
receive either a lump sum amount equal to the vested portion of his account, or
an annuity contract of equivalent value. Upon termination, life insurance
coverage purchased through the Plan may be either converted to cash or
transferred to the participant.
Vesting
Participants are immediately vested in their profit-sharing accounts and their
401(k) contributions, including the matching contributions from the Company and
actual earnings thereon.
Page 5
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CULP, INC. EMPLOYEES' RETIREMENT BUILDER PLAN
NOTES TO FINANCIAL STATEMENTS
NOTE C - INVESTMENT FUNDS
The following information summarizes the financial condition of the Plan by fund
type as of December 31, 1995 and 1994:
<TABLE>
<CAPTION>
December 31, 1995
Guaranteed
Insurance Life
Value Contract Insurance Stock Balanced
Fund Fund Fund Fund Fund Total
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investments $ 2,374,244 $ 7,988,991 $ - $ 2,975,479 $ 3,407,547 $ 16,746,261
Receivables
Employer contributions 9,257 34,352 - 10,452 13,189 67,250
Employee contributions 23,643 79,847 - 25,135 32,265 160,890
------------ ------------ ------------ ------------ ------------ ---------
TOTAL ASSETS 2,407,144 8,103,190 - 3,011,066 3,453,001 16,974,401
LIABILITIES
Accounts payable - 1,470 - - - 1,470
----------- ------------ ------------ ------------ ------------ ------------
NET ASSETS AVAILABLE
FOR PLAN BENEFITS $ 2,407,144 $ 8,101,720 $ - $ 3,011,066 $ 3,453,001 $ 16,972,931
=========== ============ ============ ============ ============ ============
December 31, 1994
Guaranteed
Insurance Life
Value Contract Insurance Stock Balanced
Fund Fund Fund Fund Fund Total
ASSETS
Investments $ 1,274,731 $ 7,183,949 $ - $ 2,421,213 $ 2,709,574 $ 13,589,467
Receivables
Employer contributions 7,200 34,722 - 12,947 14,878 69,747
Employee contributions 18,634 79,619 964 31,760 35,470 166,447
------------ ------------ ------------ ------------ ------------ ---------
TOTAL ASSETS 1,300,565 7,298,290 964 2,465,920 2,759,922 13,825,661
LIABILITIES
Accounts payable 1,068 8,425 964 2,044 2,016 14,517
----------- ------------ ------------ ------------ ------------ ------------
NET ASSETS AVAILABLE
FOR PLAN BENEFITS $ 1,299,497 $ 7,289,865 $ - $ 2,463,876 $ 2,757,906 $ 13,811,144
=========== ============ ============ ============ ============ ============
</TABLE>
Page 6
<PAGE>
CULP, INC. EMPLOYEES' RETIREMENT BUILDER PLAN
NOTES TO FINANCIAL STATEMENTS
NOTE C - INVESTMENT FUNDS (Continued)
The following information summarizes the changes in net assets available for
plan benefits by fund type for the years ended December 31, 1995, 1994 and 1993:
<TABLE>
<CAPTION>
Year Ended December 31, 1995
Guaranteed
Insurance Life
Value Contract Insurance Stock Balanced
Fund Fund Fund Fund Fund Total
<S> <C> <C> <C> <C> <C> <C>
ADDITIONS TO NET ASSETS
ATTRIBUTED TO
Net income from investment
in a common trust $ 494,397 $ 447,764 $ - $ - $ 715,633 $ 1,657,794
Appreciation in fair value of
Culp, Inc. Stock Fund - - - 285,027 - 285,027
Dividend income from Culp, Inc.
Stock Fund - - - 25,344 - 25,344
Interest income from Culp, Inc.
Stock Fund - - - 194 - 194
Contributions
Employer 108,018 378,015 - 144,284 171,135 801,452
Employees 280,253 873,833 3,377 352,490 412,988 1,922,941
----------- ------------ ------------ ------------ ------------ ------------
TOTAL ADDITIONS 882,668 1,699,612 3,377 807,339 1,299,756 4,692,752
----------- ------------ ------------ ------------ ------------ ------------
DEDUCTIONS FROM NET
ASSETS ATTRIBUTED TO
Benefits paid to participants 92,103 956,495 607 187,168 223,471 1,459,844
Insurance 406 7,121 - 2 1,896 9,425
Trustee fees 8,005 30,302 - 10,056 13,333 61,696
----------- ------------ ------------ ------------ ------------ ------------
TOTAL DEDUCTIONS 100,514 993,918 607 197,226 238,700 1,530,965
----------- ------------ ------------ ------------ ------------ ------------
NET INCREASE 782,154 705,694 2,770 610,113 1,061,056 3,161,787
NET ASSETS AVAILABLE
FOR PLAN BENEFITS
Beginning of year 1,299,497 7,289,865 - 2,463,876 2,757,906 13,811,144
Fund transfers 325,493 106,162 (2,770) (62,924) (365,961) -
----------- ------------ ----------- ----------- ----------- ------------
END OF YEAR $ 2,407,144 $ 8,101,721 $ - $ 3,011,065 $ 3,453,001 $ 16,972,931
=========== ============ ============ ============ ============ ============
</TABLE>
Page 7
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CULP, INC. EMPLOYEES' RETIREMENT BUILDER PLAN
NOTES TO FINANCIAL STATEMENTS
NOTE C - INVESTMENT FUNDS (Continued)
<TABLE>
<CAPTION>
Year Ended December 31, 1994
Guaranteed
Insurance Life
Value Contract Insurance Stock Balanced
Fund Fund Fund Fund Fund Total
<S> <C> <C> <C> <C> <C> <C>
ADDITIONS TO NET ASSETS
ATTRIBUTED TO
Net income (loss) from
investment in a common trust $ 40,233 $ 373,359 $ - $ - $(60,453) $ 353,139
Appreciation in fair value of
Culp, Inc. Stock Fund - - - (909,365) - (909,365)
Dividend income from Culp, Inc.
Stock Fund - - - 14,684 - 14,684
Interest income from Culp, Inc.
Stock Fund - - - 5,629 - 5,629
Contributions
Employer 40,402 406,128 - 145,741 180,809 773,080
Employees 105,230 925,415 11,353 365,464 443,901 1,851,363
----------- ------------ ------------ ------------ ------------ ------------
TOTAL ADDITIONS 185,865 1,704,902 11,353 (377,847) 564,257 2,088,530
----------- ------------ ------------ ----------- ------------ ------------
DEDUCTIONS FROM NET
ASSETS ATTRIBUTED TO
Benefits paid to participants 3,015 624,715 - 158,265 288,395 1,074,390
Insurance - - 11,353 - - 11,353
Trustee fees 2,937 39,774 - 9,542 14,761 67,014
----------- ------------ ------------ ------------ ------------ ------------
TOTAL DEDUCTIONS 5,952 664,489 11,353 167,807 303,156 1,152,757
----------- ------------ ------------ ------------ ------------ ------------
NET INCREASE (DECREASE) 179,913 1,040,413 - (545,654) 261,101 935,773
NET ASSETS AVAILABLE
FOR PLAN BENEFITS
Beginning of year - 7,897,402 - 2,463,339 2,514,630 12,875,371
Fund transfers 1,119,584 (1,647,950) - 546,191 (17,825) -
----------- ----------- ------------ ------------ ----------- ------------
END OF YEAR $ 1,299,497 $ 7,289,865 $ - $ 2,463,876 $ 2,757,906 $ 13,811,144
=========== ============ ============ ============ ============ ============
</TABLE>
Page 8
<PAGE>
CULP, INC. EMPLOYEES' RETIREMENT BUILDER PLAN
NOTES TO FINANCIAL STATEMENTS
NOTE C - INVESTMENT FUNDS (Continued)
<TABLE>
<CAPTION>
Year Ended December 31, 1993
Guaranteed
Insurance Life
Contract Insurance Stock Balanced
Fund Fund Fund Fund Total
<S> <C> <C> <C> <C> <C>
ADDITIONS TO NET ASSETS
ATTRIBUTED TO
Net income from investment
in a common trust $ 398,454 $ - $ - $ 229,020 $ 627,474
Appreciation in fair value of
Culp, Inc. Stock Fund - - 1,721,339 - 1,721,339
Dividend income from Culp, Inc.
Stock Fund - - 10,821 - 10,821
Interest income from Culp, Inc.
Stock Fund - - 2,643 - 2,643
Contributions
Employer 420,798 - 56,927 119,111 596,836
Employees 953,420 13,748 130,726 297,949 1,395,843
------------ ------------ ------------ ------------ ------------
TOTAL ADDITIONS 1,772,672 13,748 1,922,456 646,080 4,354,956
------------ ------------ ------------ ------------ ------------
DEDUCTIONS FROM NET
ASSETS ATTRIBUTED TO
Benefits paid to participants 649,474 - 164,599 112,797 926,870
Insurance - 13,748 - - 13,748
Trustee fees 46,574 - 8,415 13,932 68,921
------------ ------------ ------------ ------------ ------------
TOTAL DEDUCTIONS 696,048 13,748 173,014 126,729 1,009,539
------------ ------------ ------------ ------------ ------------
NET INCREASE 1,076,624 - 1,749,442 519,351 3,345,417
NET ASSETS AVAILABLE
FOR PLAN BENEFITS
Beginning of year 6,781,347 - 847,417 1,901,190 9,529,954
Fund transfers 39,431 - (133,520) 94,089 -
------------ ------------ ----------- ------------ ------------
END OF YEAR $ 7,897,402 $ - $ 2,463,339 $ 2,514,630 $ 12,875,371
============ ============ ============ ============ ============
</TABLE>
Page 9
<PAGE>
CULP, INC. EMPLOYEES' RETIREMENT BUILDER PLAN
NOTES TO FINANCIAL STATEMENTS
NOTE D - INVESTMENTS
The following table presents the quoted market value of investments at December
31, 1995 and 1994. Investments that represent 5% or more of total plan assets
are separately identified.
<TABLE>
<CAPTION>
1995 1994
--------------- ----------
<S> <C> <C>
Investments at fair value as determined by quoted market price:
Common trust funds:
First Union Funds Value Portfolio Trust $ 2,374,244 $ 1,274,731
Common trust fund - Money Market Stable
Investment Fund 7,988,991 7,183,949
First Union Funds Balanced Portfolio Trust 3,407,547 2,709,574
Culp, Inc. common stock 2,975,479 2,421,213
--------------- ----------------
$ 16,746,261 $ 13,589,467
=============== ================
</TABLE>
NOTE E - ACCOUNTS OF TERMINATED PARTICIPANTS
Included in net assets available for plan benefits at December 31, 1995 and 1994
is $227,480 and $541,000, respectively, allocated to the accounts of persons who
elected to withdraw from the Plan or who were terminated but have not yet been
paid.
NOTE F - TERMINATION PRIORITIES
While the Company expects to continue the Plan indefinitely, should the Plan be
terminated, the net assets available for plan benefits at the termination date
would be distributed to participants based on amounts which have been allocated
to their respective accounts.
NOTE G - INCOME TAX STATUS
The Plan obtained its last determination letter on June 15, 1995, in which the
Internal Revenue Service stated that the Plan, as then designed, constituted a
qualified trust under Section 401(a) of the Internal Revenue Code and is
therefore exempt from federal income taxes under provisions of Section 501. The
Plan has been amended since receiving the determination letter. However, the
plan administrator and the Plan's tax counsel believe that the Plan is currently
designed and being operated in compliance with the applicable requirements of
the Internal Revenue Code. Therefore, they believe that the Plan was qualified
and the related trust was tax-exempt as of the financial statement date.
Except for a portion of the amounts paid as premiums for life insurance
coverage, contributions are exempt from federal income taxes until they are
distributed to the participants or their beneficiaries.
Page 10
