<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
F O R M 10-Q
For the Quarter Ended October 1, 1994 Commission File Number 1-5315
------------------------
S P R I N G S I N D U S T R I E S, I N C.
(Exact name of registrant as specified in its charter)
SOUTH CAROLINA 57-0252730
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
205 North White Street
Fort Mill, South Carolina 29715
(Address of principal executive offices) (ZIP CODE)
Registrant's telephone number, including area code:
(803) 547-1500
------------------------
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for at least the past 90 days.
Yes X No
------ ------
------------------------
As of November 4, 1994, there were 9,745,584 shares of Class A Common Stock and
7,849,781 shares of Class B Common Stock of Springs Industries, Inc.
outstanding.
------------------------
There are 65 pages in the sequentially numbered, manually signed original of
this report.
Page 1 of 65
<PAGE> 2
TABLE OF CONTENTS TO FORM 10-Q
PART I - FINANCIAL INFORMATION
- - ------------------------------
<TABLE>
<CAPTION>
ITEM PAGE
- - ---- ----
<S> <C>
1. FINANCIAL STATEMENTS 3
2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS 8
PART II - OTHER INFORMATION
- - ---------------------------
ITEM PAGE
- - ---- ----
6. EXHIBITS 10
SIGNATURES 11
EXHIBIT INDEX 12
</TABLE>
Page 2 of 65
<PAGE> 3
PART I
ITEM I - FINANCIAL STATEMENTS
SPRINGS INDUSTRIES, INC.
Consolidated Statements of Operations
and Retained Earnings
(In thousands except per share data)
(Unaudited)
<TABLE>
<CAPTION>
THIRTEEN WEEKS ENDED THIRTY-NINE WEEKS ENDED
---------------------- -----------------------
October 1, OCTOBER 2, October 1, October 2,
1994 1993 1994 1993
--------- --------- --------- -----------
<S> <C> <C> <C> <C>
Operations
Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 535,265 $ 514,464 $1,535,738 $1,500,090
Cost and expenses:
Cost of goods sold . . . . . . . . . . . . . . . . . . . . . . 417,758 410,759 1,222,752 1,205,461
Selling, general and
administrative expenses . . . . . . . . . . . . . . . . . . . 76,324 69,697 224,781 211,255
Interest expense . . . . . . . . . . . . . . . . . . . . . . . 6,795 7,530 21,228 23,080
Other (income) expense . . . . . . . . . . . . . . . . . 530 1,613 (52) 3,484
---------- ---------- ---------- ----------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . 501,407 489,599 1,468,709 1,443,280
---------- ---------- ---------- ----------
Income before income taxes . . . . . . . . . . . . . . . . . . . 33,858 24,865 67,029 56,810
Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . 14,244 11,192 28,534 25,029
---------- ---------- ---------- ----------
Income before cumulative effects
of changes in accounting
principles . . . . . . . . . . . . . . . . . . . . . . . . . . 19,614 13,673 38,495 31,781
========== ========== ========== ==========
Cumulative effects of changes in
accounting principles . . . . . . . . . . . . . . . . . . . . . - - - (72,543)
---------- ---------- ---------- ----------
Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . $ 19,614 $ 13,673 $ 38,495 $ (40,762)
========== ========== ========== ==========
Per share:
Income before cumulative effects
of changes in accounting
principles . . . . . . . . . . . . . . . . . . . . . . . . . $ 1.10 $ .77 $ 2.16 $ 1.78
Cumulative effects of changes in
accounting principles . . . . . . . . . . . . . . . . . . . . - - - (4.07)
---------- ---------- ---------- ----------
Net income (loss) . . . . . . . . . . . . . . . . . . . . . . $ 1.10 $ .77 $ 2.16 $ (2.29)
========== ========== ========== ==========
Cash dividends - Class A shares . . . . . . . . . . . . . . . . . $ .30 $ .30 $ .90 $ .90
========== ========== ========== ==========
Cash dividends - Class B shares . . . . . . . . . . . . . . . . . $ .27 $ .27 $ .81 $ .81
========== ========== ========== ==========
Weighted average shares of
common stock . . . . . . . . . . . . . . . . . . . . . . . . . 17,792 17,827
========== ==========
RETAINED EARNINGS
Retained earnings at beginning
of period . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 535,229 $ 507,357 $ 526,428 $ 571,864
Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . 19,614 13,673 38,495 (40,762)
Cash dividends . . . . . . . . . . . . . . . . . . . . . . . . . (5,051) (5,037) (15,131) (15,109)
---------- ---------- ---------- ----------
Retained earnings at end of period . . . . . . . . . . . . . . . $ 549,792 $ 515,993 $ 549,792 $ 515,993
========== ========== ========== ==========
</TABLE>
Page 3 of 65
<PAGE> 4
SPRINGS INDUSTRIES, INC.
Condensed Consolidated Balance Sheet
(In thousands except share data)
<TABLE>
<CAPTION>
(Unaudited)
OCTOBER 1, JANUARY 1,
1994 1994
---------- ----------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . $ 482 $ 2,790
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . 353,328 315,834
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 274,922 267,842
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42,629 40,073
---------- -----------
Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . 671,361 626,539
---------- -----------
Property, plant, and equipment . . . . . . . . . . . . . . . . . . . . . . . 1,233,978 1,195,843
Accumulated depreciation . . . . . . . . . . . . . . . . . . . . . . . . . (683,940) (645,938)
---------- -----------
Property, plant, and equipment; net . . . . . . . . . . . . . . . . . . . 550,038 549,905
---------- -----------
Other assets and deferred charges . . . . . . . . . . . . . . . . . . . . . . 114,621 115,687
---------- -----------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,336,020 $ 1,292,131
========== ===========
LIABILITIES AND SHAREOWNERS' EQUITY
Current liabilities:
Short-term borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 70,900 $ 61,420
Current maturities of long-term debt . . . . . . . . . . . . . . . . . . . 20,516 20,511
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79,753 73,640
Other accrued liabilities . . . . . . . . . . . . . . . . . . . . . . . . . 132,581 117,439
---------- -----------
Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . . 303,750 273,010
---------- -----------
Noncurrent liabilities:
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 270,164 293,028
Long-term benefit plans and deferred
compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 142,898 139,284
Deferred income taxes and other deferred
credits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51,688 43,616
---------- -----------
Total noncurrent liabilities . . . . . . . . . . . . . . . . . . . . . . 464,750 475,928
---------- -----------
Shareowners' equity:
Class A common stock - $.25 par value
(9,865,507 and 9,858,035 shares issued
in 1994 and 1993, respectively) . . . . . . . . . . . . . . . . . . . . . 2,466 2,465
Class B common stock - $.25 par value
(7,849,781 and 7,853,087 shares issued
in 1994 and 1993, respectively) . . . . . . . . . . . . . . . . . . . . . 1,962 1,963
Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . . . . 11,430 11,144
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 549,792 526,428
Cost of Class A shares in treasury
(October 1, 1994 - 120,023 shares;
January 1, 1994 - 129,460 shares) . . . . . . . . . . . . . . . . . . . . (2,607) (2,785)
Currency translation adjustment . . . . . . . . . . . . . . . . . . . . . . 4,477 3,978
---------- -----------
Shareowners' equity . . . . . . . . . . . . . . . . . . . . . . . . . . . 567,520 543,193
---------- -----------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,336,020 $ 1,292,131
========== ===========
</TABLE>
Page 4 of 65
<PAGE> 5
SPRINGS INDUSTRIES, INC.
Condensed Consolidated Statement of Cash Flows
(In thousands)
(Unaudited)
<TABLE>
<CAPTION>
THIRTY-NINE WEEKS ENDED
--------------------------------
OCTOBER1, OCTOBER 2,
1994 1993
--------- ----------
<S> <C> <C>
Cash Provided (Used) by:
Operating activities:
Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 38,495 $ (40,762)
Adjustments to reconcile net income (loss) to
net cash provided (used) by operating
activities:
Cumulative effects of changes in
accounting principles . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 72,543
Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . 68,974 66,588
Changes in operating assets and liabilities,
excluding effects of the transfer of European
subsidiaries and sale of business . . . . . . . . . . . . . . . . . . . . . . (27,545) (86,748)
Other, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (54) (6,247)
--------- ---------
Net cash provided by operating activities . . . . . . . . . . . . . . . . . 79,870 5,374
--------- ---------
Investing activities:
Purchase of property, plant and
equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (66,439) (56,549)
Acquisition of minority interest . . . . . . . . . . . . . . . . . . . . . . . - (8,780)
Proceeds from sale of assets . . . . . . . . . . . . . . . . . . . . . . . . . 387 691
Proceeds from sale of business . . . . . . . . . . . . . . . . . . . . . . . . 17,813 -
--------- ---------
Net cash (used) by investing activities . . . . . . . . . . . . . . . . . . (48,239) (64,638)
--------- ---------
Financing activities:
Proceeds from short-term borrowings . . . . . . . . . . . . . . . . . . . . . . 9,480 58,486
Proceeds from commercial paper and long-term
debt borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,158 48,996
Payment of long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . (24,407) (28,817)
Payment of dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (20,170) (20,143)
--------- ---------
Net cash provided (used) by
financing activities . . . . . . . . . . . . . . . . . . . . . . . . . . (33,939) 58,522
--------- ---------
Decrease in cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . $ (2,308) $ (742)
========= =========
</TABLE>
Page 5 of 65
<PAGE> 6
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Significant Accounting Policies:
These condensed consolidated financial statements should be read in
conjunction with the financial statements presented in the Springs
Industries, Inc. ("Springs" or "the Company") 1993 Annual Report on Form
10-K.
In the opinion of the management of Springs, these unaudited condensed
consolidated financial statements contain all adjustments of a normal
recurring nature necessary for their fair presentation. The results for
interim periods reflect estimates for certain items which can be
definitively determined only on an annual basis. These items include the
valuation of a substantial portion of inventories on a LIFO cost basis and
the provision for income taxes. These interim financial statements reflect
applicable portions of the estimated annual amounts for such items.
The results of operations for interim periods are not necessarily
indicative of operating results to be expected for the remainder of the
year.
2. Inventory:
Inventories are summarized as follows (in thousands):
<TABLE>
<CAPTION>
October 1, January 1,
1994 1994
---------- ----------
<S> <C> <C>
Standard cost (which approximates
average cost) or average cost:
Finished goods $ 187,083 $ 180,989
In process 172,354 165,190
Raw materials and supplies 49,721 50,824
--------- ---------
409,158 397,003
--------- ---------
Less LIFO reserve (134,236) (129,161)
--------- ---------
Total $ 274,922 $ 267,842
========= =========
</TABLE>
3. Sale of Subsidiary:
On June 24, 1994, the Company sold all of the stock of Clark-Schwebel
Distribution Corp., a subsidiary of Clark-Schwebel, Inc. The Company
received a cash payment of $17.8 million and a note receivable of $1.3
million in connection with this sale. The gain on this transaction is
included in other (income) expense.
4. Acquisition of Minority Interest:
On March 25, 1993, Springs' subsidiary, Clark-Schwebel, Inc., contributed
its European fiberglass subsidiaries (net assets of $17.1 million) and
$8.8 million in cash to CS-Interglas A.G., of Ulm, Germany, in
consideration for a minority equity interest in CS-Interglas A.G. and a
convertible debenture. No gain or loss was recognized as a result of this
transaction since it was accounted for as a nonmonetary exchange. The
earnings
Page 6 of 65
<PAGE> 7
(losses) of the European subsidiaries were consolidated in the Company's
financial statements until March 25, 1993, at which time the Company
removed the assets and liabilities of the subsidiaries from consolidation
and began accounting for its interest in CS-Interglas A.G. under the
equity method of accounting.
5. Restructuring:
During the third quarter of 1994, the Company substantially completed its
plan for restructuring of certain finished fabrics operations which was
announced in 1990. The Company did not recognize in 1994 any gain or loss
in connection with the completion of this plan.
6. Legal and Environmental:
As disclosed in the 1993 Annual Report on Form 10-K, Springs is involved
in certain administrative proceedings alleging violations of environmental
laws and regulations, including proceedings under the Comprehensive
Environmental Response, Compensation, and Liability Act. In connection
with these proceedings, the Company has accrued an amount which represents
management's best estimate of Springs' probable liability.
Springs is also involved in various other legal proceedings and claims
incidental to its business. Springs is defending its position in all such
proceedings.
In the opinion of management, based on the advice of counsel, the
resolution of the above matters should not have a material adverse impact
on the financial condition nor the future results of operations of
Springs.
Page 7 of 65
<PAGE> 8
ITEM 2. - MANAGEMENT'S DISCUSSION AND ANALYSIS
RESULTS OF OPERATIONS
Sales
Net sales for the third quarter were up four percent from those reported in the
third quarter of 1993. Sales for the home furnishings segment increased eight
percent, due to increased shipments of bedding, bath, and window fashions
products. After adjusting for the sale of Clark-Schwebel Distribution Corp. in
June 1994, the specialty fabrics segment reported sales 11 percent greater than
a year ago. The specialty fabrics sales increase resulted from improved
shipments in both finished and industrial fabrics.
Year-to-date net sales improved two percent compared to the first nine months
of 1993. Strong volume in window fashions products and increased shipments in
bedding and bath products contributed to a sales increase of nearly six percent
in the home furnishings segment over last year. After adjusting for the sale
of Clark-Schwebel Distribution Corp. in June 1994, year-to-date specialty
fabrics sales were unchanged from the prior year. Improvements in industrial
fabric shipments were offset somewhat by a moderate decline in finished fabric
sales.
Earnings
Third quarter earnings of $1.10 per share were 43 percent higher than the
previous year's $.77 per share. The home furnishings segment's operating
profits exceeded last year's level as a result of sales growth and some margin
improvement. In addition, operating profits for the specialty fabrics segment
improved substantially over last year. The improvement in specialty fabrics
operating profits came in both the finished fabrics and industrial fabrics
businesses as a result of improved operating efficiencies and increased
industrial fabric sales volume. Other (income) expense improved as a result of
reduced foreign losses.
Year-to-date earnings of $2.16 per share represented a 21 percent increase
over 1993 nine-month earnings of $1.78, before the effect of one-time
accounting changes implemented during the first quarter of 1993. As a result
of margin pressure in the home furnishings segment's bedding division in the
first part of the year, the segment's year-to-date operating profits were below
those of the prior year, which included record first-quarter operating profits
for the segment. In the specialty fabrics segment, year- to-date operating
profits increased substantially, again due to improved operating efficiencies
and increased industrial fabric sales volume, as well as the total exclusion in
1994 of losses from former consolidated subsidiaries, now accounted for as
other (income) expense. Other (income) expense improved substantially as a
result of reduced foreign losses and the gain on the sale of Clark-Schwebel
Distribution Corp. in June 1994.
Capital Resources and Liquidity
Cash needs for capital expenditures and payments of long-term debt, including a
long-term debt prepayment, were funded through proceeds from operating cash
flows and the Company's sale of Clark-Schwebel Distribution Corp. Increased
operating cash flows resulted in a decreased need for short-term bank
Page 8 of 65
<PAGE> 9
borrowings compared to the prior year. Annual cash needs for 1994 capital
expenditures are still expected to slightly exceed 1993 levels. It is expected
that the Company will be able to fund its cash needs for the rest of the year
from operating cash flows, commercial paper and short-term bank borrowings.
Other
During the third quarter of 1994, the Company substantially completed its plan,
announced in 1990, for the restructuring of certain finished fabrics
operations. The Company did not recognize in 1994 any gain or loss in
connection with the completion of this plan.
On June 24, 1994, the Company sold all of the stock of Clark-Schwebel
Distribution Corp., a subsidiary of Clark-Schwebel, Inc. The Company received
a cash payment of $17.8 million and a note in the amount of $1.3 million in
connection with this sale. The gain on this transaction is included in other
(income) expense.
In February, 1994, the Company communicated to its bedding customers the first
general price increase since 1988, which became effective during the third
quarter of 1994. The Company also announced a plan on March 22, 1994, to
reduce annual operation costs by at least $15 million. The Company believes it
will achieve its cost reduction plan.
Page 9 of 65
<PAGE> 10
PART II - OTHER INFORMATION
ITEM 6 - EXHIBITS
The following exhibits are filed as part of this report:
(10) Material Contracts
(a) Springs Industries, Inc. Deferred Compensation Plan, as
amended and restated on August 18, 1994, is filed herewith (28 pages).
(b) Springs Industries, Inc. Deferred Compensation Plan for
Outside Directors, as amended and restated on August 18, 1994, is filed
herewith (24 pages).
(27) Financial Data Schedule (for SEC purposes only)
Page 10 of 65
<PAGE> 11
SIGNATURES
Pursuant to the requirements of Securities Exchange Act of 1934, Springs
Industries, Inc. has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.
SPRINGS INDUSTRIES, INC.
By: /s/ James F. Zahrn
---------------------------
James F. Zahrn
Vice President-Finance and
Treasurer
(Duly Authorized Officer and
Principal Financial Officer)
DATED: November 14, 1994
Page 11 of 65
<PAGE> 12
EXHIBIT INDEX
Item
- - ----
(10) Material Contracts
PAGE
----
(a) Springs Industries, Inc. Deferred Compensation Plan, 13
as amended and restated on August 18, 1994, is filed herewith (28
pages).
(b) Springs Industries, Inc. Deferred Compensation Plan 41
for Outside Directors, as amended and restated on August 18, 1994,
is filed herewith (24 pages).
(27) Financial Data Schedule (for SEC purposes only) 65
Page 12 of 65
<PAGE> 1
EXHIBIT INDEX
Item
- - ----
(10) Material Contracts
PAGE
----
(a) Springs Industries, Inc. Deferred Compensation Plan, 13
as amended and restated on August 18, 1994, is filed herewith (28
pages).
(b) Springs Industries, Inc. Deferred Compensation Plan 41
for Outside Directors, as amended and restated on August 18, 1994,
is filed herewith (24 pages).
(27) Financial Data Schedule (for SEC purposes only) 65
Page 12 of 65
<PAGE> 2
SPRINGS INDUSTRIES, INC.
DEFERRED COMPENSATION PLAN
I. PURPOSE. The purpose of the plan is to enable the Company and its
subsidiaries to attract and retain key employees by permitting the deferment of
a portion of their compensation until their services have terminated and to
provide for measuring deferred amounts either by the investment results of a
portfolio of securities to be owned by the Company or by a specified interest
rate.
II. DEFINITIONS.
(a) "Company" means Springs Industries, Inc., or any successor
thereto that has adopted this Plan and assumed the Company's
obligations hereunder.
(b) "Employer" means, as required by the context, the Company or
a subsidiary of the Company that has adopted this Plan.
(c) "Committee" means the Management Compensation and
Organization Committee appointed by the Board of Directors
of the Company.
(d) "Employee" means any person who is employed by an Employer
on a full-time basis, who is compensated by a regular
salary, and who, in the opinion of the Committee, is one of
the key personnel of his Employer in a position to
contribute materially to its continued growth, development
and future financial success.
Page 13 of 65
<PAGE> 3
(e) "Participant" means an Employee or former Employee who has
deferred compensation hereunder and has a credit balance in
his deferred compensation account.
(f) "Termination Date" shall mean the date of a Participant's
severance from employment with all Employers by death,
retirement, resignation, discharge or otherwise. A
Participant's transfer of employment from one Employer to
another Employer without interruption in his services is not
a termination of his employment for purposes of Article IX
hereof.
(g) "Measuring Fund" means a custodial or agency account
established as provided in Article VII hereof.
(h) "Plan Administrator" means the vice president of the Company
who is responsible for executive compensation.
(i) "Plan Interest Rate" means the greater of six percent (6%)
per annum or the prime rate of interest per annum publicly
announced and charged by Wachovia Bank & Trust Company or
any successor to its existing customers, or in the absence
of such public announcement, the prime rate quoted in The
Wall Street Journal's money rates column. Notwithstanding
the foregoing definition, the Board of Directors of the
Company may at any time direct that Plan
Page 14 of 65
<PAGE> 4
Interest Rate for future periods shall be a fixed rate of
interest less than the prime rate of interest as determined
above but not less than six percent (6%) per annum.
(j) "Valuation Date" means the last business day of each
calendar quarter.
(k) "Retirement Date" shall mean the later of the date a
Participant attains age 55 or such Participant's Termination
Date.
III. ADMINISTRATION.
(a) The Committee shall construe and interpret this Plan. No
member of the Committee shall be liable for any act done or
determination made in good faith.
(b) The construction and interpretation by the Committee of any
provision of this Plan shall be final and conclusive.
(c) The administration of this Plan is delegated to the Plan
Administrator.
IV. ESTABLISHMENT OF ACCOUNTS. The Company shall establish a
deferred compensation account (herein called the "Account") for each
Participant. The Account of a Participant may consist of either a Measuring
Fund Account or an interest Account or a combination of these Accounts as
elected by the Participant pursuant to the Plan and subject to the continued
maintenance by the Company of the Measuring Fund. The Account of each
Participant shall reflect credits for the deferred
Page 15 of 65
<PAGE> 5
compensation earned by him and such other credits or adjustments to the account
as are hereinafter provided. An account shall be maintained with respect to
each participant until the balance thereof has been paid to such participant or
to his beneficiary.
An Employer, other than the Company, of a Participant shall establish and
maintain an Account for the Participant. All payments of deferred compensation
in satisfaction of such an Account shall be made to the Participant only by his
Employer, and no other Employer shall have any obligation, contractual or
otherwise, to pay deferred compensation with respect to the Account. The
Employers shall supply the Company all information as may be necessary to
monitor Accounts for Participants not employed by the Company.
The establishment of an Account and the crediting of amounts thereto shall
create only a contractual obligation of the Employer to a Participant and shall
in no way vest in such Participant or his beneficiary any right, title or
interest in or to any of the assets of the Company or Employers or any claims
against them superior to the claim of any general contractual creditor of the
Company or any Employer.
It is the intention of the Company and all Employers that the Plan and all
Accounts or funds established hereunder be unfunded for tax purposes and for
purposes of Title I of the Employee Retirement Income Security Act.
Page 16 of 65
<PAGE> 6
V. DEFERRED COMPENSATION CHOICES.
(a) The Committee may offer an Employee, or a defined class of
Employees, the choice of deferring receipt of a portion of
compensation for services to be rendered in the future.
(b) Compensation deferred by an Employee is limited to 40% of
salary and to 100% of any bonus or other cash payment under
any compensation plan of the Employer.
(c) The offer of the Committee shall designate the period of
service as to which deferment of a portion of compensation
may be chosen.
(d) The Employee, if the Measuring Fund is being maintained by
the Company, may elect to have all or any designated portion
of the deferred compensation credited to a Measuring Fund
Account with any balance being credited to an Interest
Account.
(e) An election to defer compensation must be delivered in
writing to the Committee within the period specified by the
Committee and is irrevocable. The specified period must end
prior to the commencement of the period of service to which
the election relates; provided, however, that
notwithstanding the foregoing provision and the provisions
of paragraph (a) of this Article:
Page 17 of 65
<PAGE> 7
(i) The Committee may offer an Employee the choice of
deferring all or a portion of a bonus or other
incentive compensation which is contingent upon
profits or upon the Employee's performance during a
year and which is payable under a plan not adopted by
his Employer prior to the beginning of such year. The
Employee's election to defer all or part of such bonus
or incentive compensation may be delivered in writing
to the Committee within a period specified by the
Committee which shall expire not later than the end of
the month following the month in which such bonus or
incentive compensation plan is adopted, except that in
the case of an Employee selected for participation in
such plan after the end of the month in which such
plan is adopted, the Committee may specify a
reasonable period after he is notified of his
selection for his election to defer such bonus or
incentive compensation;
(ii) The Committee, when authorized by the Board of
Directors to determine the amount of any bonus to be
paid to an Employee for services during a fiscal year,
may offer the Employee a choice of deferring all or a
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<PAGE> 8
portion of the bonus. The Employee's election to
defer all or a part of the bonus must be delivered in
writing to the Committee prior to March 1 of the
fiscal year for which the bonus may be determined.
(f) Deferred compensation shall be distributed as provided in
Article IX hereof.
VI. CREDITING DEFERRED COMPENSATION TO ACCOUNTS.
(a) Deferred compensation shall be credited to the Measuring
Fund Account or the Interest Account of a Participant or to
both such Accounts, as the Participant may have elected, as
of the last day of the month or other compensation period
for which such deferred compensation is earned.
(b) There shall also be credited to the Account of a Participant
as additional deferred compensation an amount equal to:
(i) any additional amount which would have been allocated
to his accounts under the Company's Springs of
Achievement Partnership Plan ("Partnership Plan")
(without regard to any limitation under the Internal
Revenue Code on compensation that can be considered
under the Partnership Plan) from the Employer's
contributions for the year under
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<PAGE> 9
the Partnership Plan if the Participant had not
elected hereunder to defer compensation; and
(ii) any additional amount which would have been
contributed or allocated for the year for the
Participant from Employer's contributions under a
pension or profit-sharing plan maintained by an
Employer (without regard to any limitation under the
Internal Revenue Code on compensation that can be
considered under the plan) and qualified under Section
401(a) of the Internal Revenue Code if the Participant
had not elected hereunder to defer compensation.
(c) The additional deferred compensation credited under
paragraph (b) shall be credited to the Participant's
Measuring Fund Account or Interest Account in the same
proportion as amounts credited under paragraph (a) for the
year for which the contribution to the respective plan was
made and shall be credited as of the date or dates on which
the Employer's contributions are made to the respective
plan.
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<PAGE> 10
(d) Amounts credited to the Account of a Participant as deferred
compensation are not forfeitable, subject to the adjustments
provided in Articles VII, VIII and IX.
VII. THE MEASURING FUND.
(a) Subject to the provisions of paragraph (c) of this Article
VII, the Company may, from time to time, establish with a
federal or state chartered bank (hereinafter called the
"Custodian"), as selected by the officers of the Company, a
custodial and agency account in its name, the assets of
which account are referred to hereinafter as the "Measuring
Fund." All monies or assets placed in such account by the
Company shall at all times remain the property of the
Company subject to the claims of its general creditors, and
no Participant or Beneficiary shall have any right to or
interest in such monies or assets or any claims against them
superior to the claims of any general creditor of the
Company or his Employer. The Measuring Fund shall serve the
sole purpose of being one of the means of determining
amounts of deferred compensation to be paid or credited to
Participants of the Plan and other deferred compensation
plans of the Company and its subsidiaries. The Measuring
Fund shall
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<PAGE> 11
not constitute a trust fund or escrow account in which
Participants or their Beneficiaries have any interest.
(b) Upon the establishment or reestablishment of such a
custodial and agency account the Company will deposit in the
Measuring Fund an amount equal to the aggregate of all
deferred compensation credited to the Accounts of
Participants at such time except such amounts as have been
credited to Interest Accounts in their respective names
pursuant to elections by them hereunder. Thereafter, on or
before the last business day of each calendar month, the
Company will deposit in the Measuring Fund an amount equal
to the aggregate of all deferred compensation credited to
Measuring Fund Accounts during such month after deducting
from such aggregate an amount equal to all payments made
during such month by the Employers in satisfaction of the
Measuring Fund Accounts of persons whose services have
terminated. If such payments in satisfaction of Measuring
Fund Accounts exceed such aggregate of credits of deferred
compensation in any month, an amount equal to such excess
shall be withdrawn by the Company from the Measuring Fund.
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<PAGE> 12
(c) The Custodian will be directed by the Company to invest the
Measuring Fund as agent for the Company in common or
preferred stocks, bonds, other securities, and short-term
investments. The Company shall determine whether
investments of the Measuring Fund will be managed by the
Company, the Custodian or one or more investment managers.
Neither the Company, the Custodian nor any investment
manager shall be liable to any Participant for any decision
made or action with respect to such investments.
(d) As of each Valuation Date, an amount equal to the net amount
of dividends, interest, other current income, and gains or
losses realized on the sale or exchange of assets in the
Measuring Fund during the calendar quarter in which such
Valuation Date occurs, received by the Custodian for a
Measuring Fund during such quarter, all as determined by
the Custodian in its absolute discretion, shall be allocated
by the Company among and credited or debited to the
respective Measuring Fund Accounts of persons who have
Measuring Fund Accounts as of such Valuation Date in the
proportion that the average credit balance (calculated as
hereinafter provided) in the Measuring Fund Account of each
person during the calendar quarter in which such
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<PAGE> 13
Valuation Date occurs bears to the aggregate of such average
credit balances in the Measuring Fund Accounts of all such
persons during such quarter. The average credit balance in
a Measuring Fund Account during a calendar quarter shall be
determined in accordance with such uniform rules applied in
a nondiscriminatory manner as the Plan Administrator may
adopt to take into account the effect of credits to,
distributions from, or transactions in, such Account since
the preceding Valuation Date.
(e) As of each Valuation Date, the Measuring Fund shall be
valued by the Custodian at the fair market values of the
assets in the Fund as of the close of business on such
Valuation Date. The Custodian shall certify the results
of such valuation to the Company. As soon as practicable
after each Valuation Date, the Company shall determine the
amount by which the value of the net assets in the Measuring
Fund, as of the close of business on such Valuation Date, as
certified by the Custodian, exceeds or is less than the
aggregate of the credit balances in all Measuring Fund
Accounts as of said Valuation Date, prior to making any
adjustments to accounts to be made as of said Valuation Date
under this paragraph (e). The amount so
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<PAGE> 14
determined shall be credited or debited by the Company, as
appropriate, as of said Valuation Date, to the Measuring
Fund Accounts of persons having a credit balance as of said
Valuation Date, in the proportion that the average credit
balance, computed as provided in paragraph (d), in the
Measuring Fund Account of each person during the calendar
quarter in which such Valuation Date occurs bears to the
aggregate of such average credit balances in the Measuring
Fund Accounts of all such persons during such quarter.
(f) Notwithstanding any other provision of this Plan, the Board
of Directors of the Company may at any time direct that all
assets in the Measuring Fund be withdrawn from the custodial
and agency account for use for any corporate purpose
whatsoever and that the custodial and agency account with
the Custodian be discontinued. The date on which such
withdrawal occurs shall be deemed to be a Valuation Date,
and adjustments to Measuring Fund Accounts shall be made as
of such date as provided in paragraph (d) and paragraph (e)
of this Article VII, except that in making such
determinations it shall be deemed that all assets in the
Measuring Fund were converted into cash
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<PAGE> 15
on the date on which such withdrawal occurs.
Following such withdrawal, and until the reestablishment of a
Measuring Fund, each Participant's Measuring Fund Account,
adjusted as aforesaid, shall be deemed to be an Interest
Account in his name which shall be maintained separate from
any other Interest Account then existing in his name. If the
Company thereafter reestablishes a Measuring Fund, the amount
in any such separate Interest Account derived from a
Measuring Fund Account shall thereupon and thereafter be
deemed to be a Measuring Fund Account until the Board of
Directors of the Company again directs the withdrawal of all
assets from the Measuring Fund.
VIII. INTEREST ACCOUNTS. As of each Valuation Date there shall be
credited to each Interest Account (including any separate Interest Account
arising by reason of withdrawal of all assets from the Measuring Fund) for the
quarter ending on the Valuation Date an amount equivalent to interest at the
Plan Interest Rate in effect on such Valuation Date on the amount of the
Interest Account on such date; provided, however, that amounts equivalent to
interest on deferred compensation credited to the Interest Account during such
quarter shall be determined only on the basis of the number of days such
deferred compensation was credited to the Interest Account during such quarter;
and, provided, further, however, that amounts equivalent to interest shall be
determined prior to any credit under paragraph (a) of Article VI for
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<PAGE> 16
deferred compensation earned for services performed in the last month of such
quarter. Amounts equivalent to interest which are credited to Interest
Accounts hereunder shall not be paid to Employees until the times provided in
Article IX.
IX. PAYMENT OF DEFERRED COMPENSATION.
(a) No payments shall be made in satisfaction of the Account of
a Participant until after termination of his employment with
all Employers.
(b) Each person, upon becoming a Participant, shall file with
the Plan Administrator a notice in writing designating one
or more Beneficiaries to whom payment of his Account shall
be made in the event of his death before receiving payment
of his Account in full. Each Participant shall have the
right to change Beneficiary or Beneficiaries. Any changes
shall be in writing, signed by the Participant, and shall be
effective only upon delivery to the Plan Administrator. If
no designated Beneficiary survives the Participant, or if a
Participant shall fail to designate a Beneficiary, any
balance of the Participant's Account shall be paid to the
estate of the Participant as hereinafter provided.
(c) The balance of a Participant's Interest Account, including
any separate Interest Account deemed to exist by reason of
disestablishment of the Measuring Fund, shall be paid to the
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<PAGE> 17
Participant (or to his Beneficiary or estate) in annual
installments, over the period and commencing on the date as
provided in Paragraph (e) below, by one of the following
methods as selected by the Committee:
(i) In annual installments calculated so as to amortize
the balance in such account, together with Plan
Interest credited thereon, in approximately equal
annual amounts over the period with such payments
being recalculated from time to time to reflect
changes in the Plan Interest Rate;
(ii) In annual installments calculated by dividing the
balance in such account at the end of the quarter
next preceding the payment of the first such
installment by the number of years in the period and,
with respect to installments subsequent to the first
installment, by adding thereto interest at the Plan
Interest Rate credited during the preceding year on
the unpaid balance in such Account;
(iii) In annual installments calculated by multiplying the
balance in such Account at the end of the quarter
next preceding the payment of an installment by a
fraction, the numerator of which is one and the
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<PAGE> 18
denominator of which is the number of years remaining
in the period; or
(iv) By such other method as the Committee shall specify.
(d) The balance of a Participant's Measuring Fund shall be paid
to such Participant (or to his Beneficiary or estate) in
annual installments, over the period and commencing on the
date as provided in paragraph (e) below, determined as
follows:
The balance in the Participant's Measuring Fund
Account as of the Valuation Date on or next preceding
the payment of an installment shall be multiplied by
a fraction, the numerator of which is one and the
denominator of which is the number of years remaining
in the period.
(e) Deferred compensation shall be distributed to a Participant
as follows:
(i) If the Termination Date of the Participant occurs on
or after the 55th birthdate of the Participant, the
Account of the Participant shall be distributed in
ten annual installments commencing in January of the
year next following the year in which the
Participant's Termination Date occurs;
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<PAGE> 19
(ii) If the employment of the Participant terminates due
to total disability or for economic reasons prior to
age 55, the Account of the Participant shall be
distributed in ten annual installments commencing in
January of the year following the year in which the
Participant attains age 55. Total disability and
termination of employment for economic reasons shall
have the same meaning as the terms are defined in the
Springs of Achievement Partnership Plan;
(iii) In the case of a Participant who terminates his
employment with all Employers in order to become
employed by a competitor of any Employer, the Account
of the Participant shall be distributed in a single
sum in January of the year next following the year in
which the Participant's Termination Date occurs;
(iv) In the case of death of a Participant prior to
commencement of distribution of deferred
compensation, the Account of the Participant shall be
distributed to the Participant's Beneficiary or
estate, as applicable, in ten annual installments
commencing
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<PAGE> 20
in January of the year next following the year of
death;
(v) In the case of death after commencement of
distribution of deferred compensation of a
Participant, the Account of the Participant shall be
distributed to the Participant's Beneficiary or
estate, as applicable, over the period remaining in
which distribution would have been made to the
Participant;
(vi) In the case of any other termination of employment by
a Participant with all Employers, the Account of the
Participant shall be distributed in ten annual
installments commencing in January of the year next
following the year in which the Participant's
Termination Date occurs; provided, however, in case
of termination of employment for cause as determined
by the Company, the Committee may in its sole
discretion accelerate distribution of deferred
compensation to the Participant;
(vii) In any case, the Committee may accelerate
distribution of deferred compensation to a
Participant based on its review of the circumstances
and in its sole discretion subject to the consent of
the
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<PAGE> 21
Participant; provided, however, no distribution of
deferred compensation may be made until after a
Participant's Termination Date.
(f) At any time prior to his Termination Date, a Participant
shall have the right to elect to have his Account adjusted
as of the Valuation Date coinciding with or immediately
following the Participant's Termination Date, in accordance
with the following provisions:
(i) The Participant may elect to have all or any part of
the balance in his Measuring Fund Account debited to
such Measuring Fund Account as of such Valuation Date
with the amount so debited being credited to an
Interest Account as of such date. An amount equal to
the amount debited to such Participant's Measuring
Fund Account shall be withdrawn by the Company from
the Measuring Fund.
(ii) An election by a Participant under this paragraph (f)
shall be made by delivery of written notice to the
Plan Administrator. A Participant may change any
such election by delivery of written notice to the
Plan Administrator any time prior to his Termination
Date.
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<PAGE> 22
(g) At any time prior to his death (whether before or after his
Termination Date) a Participant shall have the further right
to have his Account as of the Valuation Date immediately
following his death adjusted in accordance with the
following provisions:
(i) The Participant may elect to have all or any part of
the balance in his Measuring Fund Account debited to
such Measuring Fund Account as of such Valuation Date
with the amount so debited being credited to an
Interest Account as of such date. An amount equal to
the amount debited to such Participant's Measuring
Fund Account shall be withdrawn by the Company from
the Measuring Fund.
(ii) An election by a Participant under this paragraph (g)
shall be made by delivery of written notice to the
Plan Administrator. A Participant may change any
such election by delivery of written notice to the
Plan Administrator at any time prior to his death.
Such election shall be irrevocable as of the date of
his death.
(h) A Participant who has reached the age of 55 may elect
annually to have his Account adjusted as of the next
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<PAGE> 23
Valuation Date after his election in accordance with th
following provisions:
(i) Unless the Committee has otherwise advised the Plan
Administrator, the Participant may elect once in any
calendar year to have all or a part of the balance in
his Measuring Fund Account debited as of next quarter
ending after such election with the amount so debited
being credited to an Interest Account as of such
date. Partial debits shall be made in increments of
the greater of 25 percent of the balance or $25,000.
An amount equal to the amount debited to such
Participant's Measuring Fund Account shall be
withdrawn by the Company from the Measuring Fund.
(ii) An election by a Participant under this paragraph (h)
shall be made by delivery of a written notice to the
Plan Administrator not later than fifteen days
immediately preceding the Valuation Date on which the
adjustment is to be made.
(iii) Beginning with the next deferral period, all amounts
deferred after any election made under this paragraph
(h) by a Participant shall be credited only to an
Interest Account and, by making such election,
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<PAGE> 24
the Participant waives any right to make any further
deferrals to the Measuring Fund.
(iv) Notwithstanding an election pursuant to this
paragraph, a Participant shall have no right to
receive any distribution or benefit with respect to
his Account except upon termination of employment
pursuant to Article IX.
X. LIMITATION OF RIGHTS.
(a) The Committee may at any time terminate any choice of an
Employee to defer compensation for future services, so as to
discontinue future crediting of deferred compensation, but
any such action shall not affect the rights of any such
Participant with respect to amounts theretofore credited to
him under the provisions of this Plan.
(b) Nothing contained in this Plan shall be construed to:
(i) Give any Employee of any Employer any right to be
offered any choice of deferring compensation other
than in the sole discretion of the Committee subject
to the express approval of an Employer other than the
Company;
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<PAGE> 25
(ii) Limit in any way the right of an Employer to
terminate a Participant's employment with such
Employer at any time; or
(iii) Be evidence of any agreement or understanding,
express or implied, that an Employer will employ a
Participant in any particular position or at any
particular rate of remuneration.
XI. NON-ALIENATION OF BENEFITS. No right or benefit under this Plan
shall be subject to anticipation, alienation, sale, assignment,
pledge, encumbrance, or charge, and any attempt to anticipate,
alienate, sell, assign, pledge, encumber or charge the same shall
be void. No right or benefit hereunder shall in any manner be
liable for or subject to the debts, contracts, liabilities or
torts of the person entitled to such benefit. If any Participant
or Beneficiary hereunder should become bankrupt or attempt to
anticipate, alienate, sell, assign, pledge, encumber or charge
any right or benefit hereunder, then such right or benefit shall,
in the discretion of the Committee, cease, and in such event, the
Employer of the Participant involved may hold or apply the same
or any part thereof for the benefit of the Participant or
Beneficiary, his or her spouse, children or other dependents, or
any of them, in such manner and in such proportion as the
Committee may deem proper. Notwithstanding the above provisions,
an assignment of benefits under the Plan by an estate in order to
complete distribution of assets and close the estate shall be
treated as valid.
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<PAGE> 26
XII. SAVINGS DEFERRAL.
(a) At the time of an election to defer compensation pursuant to
Article V occurring on or after March 1, 1991, an Employee
may irrevocably elect deferral (the "Savings Deferral") of
the difference between (i) 4% of his compensation and (ii)
the percentage of his compensation allowable as a
contribution under the Savings Fund portion of the Springs
of Achievement Partnership Plan.
(b) Any deferral of compensation designated by an Employee as a
Savings Deferral shall be credited pursuant to paragraph (a)
of Article VI only to a separate Interest Account or
Measuring Fund Account established for the Employee for
Savings Deferrals, as elected by the Employee.
(c) Each time a Savings Deferral is credited to the separate
Interest Account of a Participant, an amount equal to the
Company matching contribution that would have been made
under the Savings Fund on an equal contribution to the
Savings Fund shall also be credited to the Participant's
separate Account.
(d) Notwithstanding any provision of Article IX to the contrary,
distributions of amounts credited to a Participant's
separate
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<PAGE> 27
Account established for a Savings Deferral shall be made in
accordance with the Participant's election as follows:
(i) in one installment commencing in January of the year
next following the year in which the Participant's
Termination Date occurs; or
(ii) in five annual installments commencing in January of
the next following year in which the Participant's
Termination Date occurs; or
(iii) pursuant to paragraph (e) of Article IX.
(e) A Participant's election as to distribution of a Savings
Deferral shall be irrevocable and shall be made at the time
of the Participant's election to defer compensation and
designation of the deferral as a Savings Deferral.
(f) This Article XII shall not apply to Employees of Springs
Window Fashions Division, Inc.
(g) The amendment of this Article XII effective March 1, 1991
shall in no way affect amounts that an Employee may have
designated as a Savings Deferral during the period March 1,
1990 to March 1, 1991 (an amount up to 20% of compensation)
or amounts credited to the separate Interest Account of the
Participant by reason of any such designation (an amount
equal to 20% of the first 4% of up to
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<PAGE> 28
$200,000 of annual compensation deferred by the Participant
during the period March 1, 1990 to December 31, 1990, and an
amount equal to 50% of the first 4% of up to $200,000 of
annual compensation deferred by the Participant during the
period January 1, 1991 to March 1, 1991).
XIII. AMENDMENT OR TERMINATION OF THE PLAN.
(a) The Board of Directors may terminate this Plan at any time.
(b) The Board of Directors may amend this Plan at any time.
(c) Any amendment or termination of this Plan shall not affect
the rights of Participants or Beneficiaries regarding
amounts credited to Accounts at the time of such amendment
or termination.
(d) Any amendment or termination of this Plan shall be effective
as to all Employers unless the Board of Directors of an
Employer shall within ten days following notice of such
amendment or termination, take contrary action.
XIV. EFFECTIVE DATE OF AMENDED AND RESTATED PLAN. This amended and
restated Plan shall be effective as of January 1, 1994, with respect to all
Accounts; provided, however, the commencement date and period of payment of
Accounts representing deferral elections prior to January 1, 1994, shall be
determined pursuant to the provisions of the Plan as in effect on December 31,
1993.
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<PAGE> 29
XV. PLAN GOVERNED BY LAWS OF SOUTH CAROLINA. This Plan and the
rights of all persons hereunder shall be construed and determined by the laws
of the State of South Carolina.
(As Amended and Restated on August 18, 1994)
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<PAGE> 30
SPRINGS INDUSTRIES, INC.
DEFERRED COMPENSATION PLAN
FOR OUTSIDE DIRECTORS
I. PURPOSE. The purpose of the plan is to enable the Company to
obtain the services of directors by permitting the deferment of their fees
until their services with the Company have terminated and to provide for
measuring such deferred amounts by the value of the Company's stock, the
investment results of a portfolio of securities to be owned by the Company or
by a specified interest rate.
II. DEFINITIONS.
(a) "Company" means Springs Industries, Inc., or any successor
by merger, consolidation, liquidation or other
reorganization that has adopted this Plan and assumed the
Company's obligations thereunder.
(b) "Committee" means the Management Compensation and
Organization Committee appointed by the Board of Directors
of the Company.
(c) "Director" means any person who is serving as a Director of
the Company, and who is not an employee of the Company or
any of its subsidiaries.
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<PAGE> 31
(d) "Participant" means a Director or former Director who has
deferred fees hereunder and has a credit balance in his
deferred compensation account.
(e) "Termination Date" shall mean the date of termination of a
Director's service with the Company.
(f) "Measuring Fund" means a custodial or agency account
established as provided in Article VIII hereof.
(g) "Plan Administrator" means the vice president of the Company
who is responsible for executive compensation.
(h) "Plan Interest Rate" means the greater of six percent (6%)
per annum or the prime rate of interest per annum publicly
announced and charged by Wachovia Bank of North Carolina to
its existing customers or in the absence of such public
announcement by such bank, the prime rate quoted in The Wall
Street Journal's money rates column. Notwithstanding the
foregoing definition, the Board of Directors of the Company
may at any time direct that Plan Interest Rate for future
periods shall be a fixed rate of interest less than the
prime rate of interest as determined above but not less than
six percent (6%) per annum.
(h) "Stock Equivalent Account" shall mean the account described
in Article VII.
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<PAGE> 32
(i) "Valuation Date" means the last business day of each
calendar quarter.
III. ADMINISTRATION.
(a) The Committee shall construe and interpret this Plan. No
member of the Committee shall be liable for any act done or
determination made in good faith.
(b) The construction and interpretation by the Committee of any
provision of this Plan shall be final and conclusive.
(c) The administration of this Plan is delegated to the Plan
Administrator.
IV. ESTABLISHMENT OF ACCOUNTS. The Company shall set up by
appropriate record a deferred compensation account (herein called the
"Account") with respect to each Participant. The Account of a Participant may
include a Stock Equivalent Account, a Measuring Fund Account or an Interest
Account or a combination of these accounts, depending in each case on the
elections made by the Participant pursuant to the Plan and the continued
maintenance by the Company of the Measuring Fund. An account of each
Participant shall reflect credits for the deferred compensation earned by him
and such other credits or adjustments to the Account as are hereinafter
provided. An account shall be maintained with respect to each participant
until the balance thereof has been paid to such Participant or to his
beneficiary.
The establishment of an Account and the crediting of amounts thereto
shall create only a contractual obligation of the Company to a Participant and
shall in
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<PAGE> 33
no way vest in such Participant or his beneficiary any right, title or interest
in or to any of the assets of the Company or any claims superior to the claim
of any general contractual creditor of the Company.
It is the intention of the Company that the Plan and all Accounts or
funds established hereunder be unfunded for tax purposes and for purposes of
Title I of the Employee Retirement Income Security Act.
V. DEFERRED COMPENSATION ELECTIONS.
(a) Each Director may elect, within fifteen days following his
election as a Director at an annual meeting of shareholders,
in writing addressed to the Plan Administrator to defer
receipt of all or a portion of any cash fees payable for the
period set forth in the following sentence. Elections to
defer fees for services after April 30, 1984, shall apply to
the period beginning the first day of the month following
such annual meeting of shareholders through the last day of
the month in which occurs the next annual meeting of
shareholders; provided, however, that a Director whose
election does not occur at the annual shareholders' meeting
may make an election to defer fees within fifteen days
following his appointment as a Director, which election
shall be effective for the period beginning with the first
day of the month in which he was appointed as a Director
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<PAGE> 34
through the last day of the month in which occurs the next
annual meeting of shareholders.
(b) A Director electing to defer payment of fees shall also
elect the portion of the amount deferred that shall be
credited to the Stock Equivalent Account, the Measuring Fund
Account and the Interest Account.
(c) Subject to such limitations as the Committee may impose, a
Director electing to defer hereunder shall also elect,
either: (A) a fixed period commencing in the January
following the Director's Termination Date over which the
balance in his Account shall be paid to him in annual
installments and a fixed period (which may be a different
period) over which the balance in his Account shall be paid
to his Beneficiary or estate in annual installments in the
event of his death before receiving such balance (an
election under this clause (A) being referred to as a "Fixed
Period Election"); or (B) an After Retirement Election.
(d) Any Fixed Period Election to defer compensation shall be
irrevocable and may not be changed or modified thereafter by
a Participant.
(e) A Participant who has elected an After Retirement Election
shall receive payment of the entire balance in his Account
in ten annual installments commencing in the January
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<PAGE> 35
following such Participant's Termination Date and his
Beneficiary or estate shall receive the balance in his
Account, in the event of such Participant's death prior to
receiving any installments, in ten annual installments
commencing in the January following such Participant's death
or in the number of remaining installments which would have
been payable to the Participant if death occurs after the
Participant had begun receiving installments.
(f) Notwithstanding any provision in this Plan to the contrary,
the period over which a Director's Account is distributed
shall not exceed the number of complete twelve month periods
during which the Director has served as a Director of the
Company; provided, however, the Director may make a request
pursuant to paragraph (g) below for a longer period of
distribution.
(g) At any time prior to his Termination Date, a Participant may
file a written request with the Committee to change an After
Retirement Election to a Fixed Period Election or to receive
distributions over a period exceeding the limitation set
forth in (f) above on the basis of a change in circumstances
which makes the payment provisions set out above
inappropriate for such Participant. The Committee in its
sole discretion may allow or deny any such requested change
of election
Page 46 of 65
<PAGE> 36
after taking into account the reasons offered by the
Participant and determining whether the grant of such
request is in the best interest of the Company. The
Committee may grant such request only upon the Participant's
agreement not to engage in competitive activity with the
Company for a period of two years following his Termination
Date and the Participant's agreement to such further
conditions and restrictions as the Committee deems necessary
to protect the interest of the Company. Any violation of
such agreement by the Participant shall result in voiding
the Committee's approval of the request of such Participant
and a reversion to the election provisions set out above.
Any election granted pursuant to the foregoing procedure
shall be irrevocable and not subject to further change
except as provided in the preceding sentence. If a member
of the Committee makes a request hereunder, the member shall
not participate in the decision of the Committee.
(h) The fact that a Participant has made a particular election
with respect to deferral of fees shall not preclude such
Participant from making different elections with respect to
new elections to defer fees covering a future period of
service.
Page 47 of 65
<PAGE> 37
VI. CREDITING DEFERRED COMPENSATION TO ACCOUNTS.
(a) Deferred compensation shall be credited to the Stock
Equivalent Account, the Measuring Fund Account or the
Interest Account of a Participant or a combination of these
accounts, as the Participant may have elected, as of the
date of payment for deferral of the cash retainer fee or
committee chairman's fee and as of the date of meeting for
any meeting fee.
VII. STOCK EQUIVALENT ACCOUNTS.
(a) The fees credited to a Stock Equivalent Account shall be
converted on the closing date for each of the Company's
fiscal quarters into Stock Equivalents as though such fees
were applied to the purchase of common stock of the Company
as follows:
The Director's Account shall be assigned Stock
Equivalents which shall be the number of full and
fractional (rounded to the nearest tenth) shares of
the Company's common stock that could be purchased,
with the fees credited to the Director's Account, at
the average of the closing prices of such stock on
the New York Stock Exchange on the last three days of
such quarter on which trading has occurred on such
exchange.
Page 48 of 65
<PAGE> 38
(b) The Company shall also establish and maintain a Dividend
Account under each Stock Equivalent Account for each
Director who has elected to have deferral of fees credited
to a Stock Equivalent Account. As of the record date for
each dividend declared on the Company's common stock, each
Director's Dividend Account shall be credited, during his
service and following his termination, with an amount
determined by multiplying the cash dividend per share of
common stock declared for such dividend record date by the
number of full and fractional Stock Equivalents credited to
the Director's Stock Equivalent Account on the dividend
record date. At the end of each of the Company's fiscal
quarters subsequent to the fiscal quarter in which such an
amount is first credited to such Director's Dividend
Account, there shall further be credited to the Director's
Dividend Account an additional amount determined by
multiplying the credit balance in the Director's Dividend
Account as of the beginning of the quarter (reduced by
distributions, if any, from the Account during such quarter)
by the Plan Interest Rate in effect on the last day of the
quarter.
VIII. THE MEASURING FUND.
(a) Subject to the provisions of paragraph (c) of this Article
VIII, the Company may, from time to time, establish with a
federal
Page 49 of 65
<PAGE> 39
or state chartered bank (hereinafter called the
"Custodian"), as selected by the officers of the Company, a
custodial and agency account in its name, the assets of
which account are referred to hereinafter as the "Measuring
Fund. All monies or assets placed in such account by the
Company shall at all times remain the property of the
Company subject to the claims of its general creditors, and
no Participant or Beneficiary shall have any right to or
interest in such monies or assets or any claims against them
superior to the claims of any general creditor of the
Company or his Employer. The Measuring Fund shall serve the
sole purpose of being one of the means of determining
amounts of deferred compensation to be paid or credited to
participants of this Plan and other deferred compensation
plans of the Company and its subsidiaries. The Measuring
Fund shall not constitute a trust fund or escrow account in
which Participants or their beneficiaries have any interest.
(b) If the Company does establish such a custodial and agency
account and so long as it is not discontinued under
paragraph (c) of this Article VIII, the following provisions
shall apply:
(i) Upon the establishment or reestablishment of such a
custodial and agency account the Company will
Page 50 of 65
<PAGE> 40
deposit in the Measuring Fund an amount equal to the
aggregate of all deferred compensation credited to
the Accounts of Participants at such time except such
amounts as have been credited to Stock Equivalent
Accounts (and related Dividend Accounts) or Interest
Accounts in their respective names pursuant to
elections by them hereunder.
Thereafter, on or before the last business day of
each calendar month, the Company will deposit in the
Measuring Fund an amount equal to the aggregate of
all deferred compensation credited to the Measuring
Fund Accounts of Participants during such month after
deducting from such aggregate an amount equal to all
payments made during such month in satisfaction of
the Measuring Fund Accounts of Participants whose
service with the Company has terminated. If such
payments in satisfaction of Measuring Fund Accounts
exceed such aggregate of credits of deferred
compensation in any month, an amount equal to such
excess shall be withdrawn by the Company from the
Measuring Fund.
(ii) The Custodian will be directed by the Company to
invest the Measuring Fund as agent for the Company
Page 51 of 65
<PAGE> 41
in common or preferred stocks bonds, other securities
and short term investments. The Company shall
determine whether investments of the Measuring Fund
will be managed by the Company, the Custodian or one
or more investment managers. Neither the Company,
the Custodian nor any investment manager shall be
liable to any Participant for any decision made or
action taken with respect to such investments.
(iii) As of each Valuation Date, an amount equal to the net
amount of dividends, interest, other current income,
and gains or losses realized on the sale or exchange
of assets in the Measuring Fund during the calendar
quarter in which such Valuation Date occurs, received
by the Custodian for a Measuring Fund during such
quarter, all as determined by the Custodian in its
absolute discretion, shall be allocated by the
Company among and credited or debited to the
respective Measuring Fund Accounts of persons who
have Measuring Fund Accounts as of such Valuation
Date in the proportion that the average credit
balance (calculated as hereinafter provided) in the
Measuring Fund Account of each
Page 52 of 65
<PAGE> 42
such person during the calendar quarter in which such
Valuation Date occurs bears to the aggregate of such
average credit balances in the Measuring Fund
Accounts of all such persons during such quarter.
The average credit balance in a Measuring Fund
Account during a calendar quarter shall be determined
in accordance with such uniform rules applied in a
nondiscriminatory manner as the Committee may adopt
to take into account the effect of credits to,
distributions from, or transactions in, such account
since the preceding Valuation Date.
(iv) As of each Valuation Date, the
Measuring Fund shall be valued by the Custodian at
the fair market values of the assets in the Fund as
of the close of business on such Valuation Date. The
Custodian shall certify the results of such valuation
to the Company. As soon as practicable after each
Valuation Date, the Company shall determine the
amount by which the value of the net assets in the
Measuring Fund, as of the close of business on such
Valuation Date, as certified by the Custodian,
exceeds or is less than the aggregate of the credit
balances in all Measuring Fund Accounts as of said
Page 53 of 65
<PAGE> 43
Valuation Date, prior to making any adjustments to
accounts to be made as of said Valuation Date under
this subparagraph (iv). The amount so determined
shall be credited or debited by the Company, as
appropriate, as of said Valuation Date, to the
Measuring Fund Accounts of persons having a credit
balance as of said Valuation Date, in the proportion
that the average credit balance, computed as provided
in subparagraph (iii) of this paragraph (b), in the
Measuring Fund Account of each such person during the
calendar quarter in which such Valuation Date occurs,
bears to the aggregate of such average credit
balances in the Measuring Fund Accounts of all such
persons during such quarter.
(c) Notwithstanding any other provision of this Plan, the Board
of Directors of the Company may at any time direct that all
assets in the Measuring Fund be withdrawn from the custodial
and agency account for use for any corporate purpose
whatsoever and that the custodial and agency account with
the Custodian be discontinued. The date on which such
withdrawal occurs shall be deemed to be a Valuation Date,
and adjustments to Measuring Fund Accounts shall be made as
of such date as provided in
Page 54 of 65
<PAGE> 44
subparagraph (iii) and (iv) of paragraph (b) of this Article
VIII, except that in making such determinations it shall be
deemed that all assets in the Measuring Fund were converted
into cash on the date on which such withdrawal occurs.
Following such withdrawal, and until the reestablishment of
a Measuring Fund, each Participant's Measuring Fund Account,
adjusted as aforesaid, shall be deemed to be an Interest
Account in his name which shall be maintained separate from
any other Interest Account then existing in his name. If
the Company thereafter reestablishes a Measuring Fund, the
amount in any such separate Interest Account derived from a
Measuring Fund Account shall thereupon and thereafter be
deemed to be a Measuring Fund Account until the Board of
Directors of the Company again directs the withdrawal of all
assets from the Measuring Fund.
IX. INTEREST ACCOUNTS. As of each Valuation Date there shall be
credited to each Interest Account established hereunder (including any separate
Interest Account arising by reason of withdrawal of all assets from the
measuring fund) for the quarter ending on such valuation date an amount
equivalent to interest at the Plan Interest Rate in effect on such Valuation
Date on the amount of such Interest Account on such date; provided, however,
that such amount equivalent to interest on deferred compensation credited to
the Interest Account during such quarter shall be
Page 55 of 65
<PAGE> 45
determined only on the basis of the number of days such deferred compensation
was credited to the Interest Account during such quarter; and, provided,
further, however, that such amounts equivalent to Interest shall be determined
prior to any crediting under Article VI, paragraph (a) of deferred compensation
earned for services performed in the last month of such quarter. Amounts
equivalent to interest which are credited to Interest Accounts hereunder shall
be paid only as provided in Article X.
X. PAYMENT OF DEFERRED COMPENSATION.
(a) No payments shall be made in satisfaction of the Account of
a Participant until after termination of services of the
Participant with the Company.
(b) Each person, upon becoming a Participant, shall file with
the Plan Administrator a notice in writing designating one
or more beneficiaries to whom payment of his Account shall
be made as hereinafter provided, in the event of his death
before receiving payment of his Account in full. Each
Participant shall have the right to change from time to
time, either before or after his Termination Date, the
beneficiary or beneficiaries to whom payment of his Account
shall be made in the event of his death. If no designated
beneficiary survives the Participant, or if a Participant
shall fail to so designate a beneficiary, any balance of the
Participant's Account hereunder shall be paid to the estate
of the Participant as hereinafter provided.
Page 56 of 65
<PAGE> 46
(c) (1) The Stock Equivalents accumulated in the Director's
Stock Equivalent Account and the amounts credited to
such Director's Dividend Account shall be distributed
to him after the termination of his service as a
Director in annual installments as provided in
Article V. The amount of each installment with
respect to the Director's Stock Equivalent Account
and related Dividend Account shall be determined by
separately dividing the Stock Equivalents credited to
his Account as of the date of distribution of such
installment and the amount credited to his related
Dividend Account as of such date by the remaining
number of installments to be distributed (including
such installment). Installments shall be distributed
as follows:
(i) Stock Equivalents shall be distributed in the
form of an equivalent number of shares of the
Company's common stock. At the Company's
option, the distribution may be in the form of
cash in the amount of the cash value on the
date of distribution of the number of Stock
Equivalents distributable in such installment,
provided that if cash is to be distributed,
such
Page 57 of 65
<PAGE> 47
Director shall be notified in writing not later
than the last of the three days specified in
the next sentence. For purposes of determining
such cash value, the Company shall use the
average of the closing prices of the Company's
common stock on the New York Stock Exchange on
the last three trading days preceding the date
of distribution of such installment.
(ii) Amounts credited to such related Dividend
Account shall be distributed in the form of
cash.
(2) In the event of any change (by reason of a merger,
consolidation, reorganization, recapitalization,
stock dividend, stock split-up, combination, exchange
of shares, or other similar change in the corporate
structure) in the shares upon which the Stock
Equivalents hereunder are based, the Stock
Equivalents credited to the Director shall be
appropriately adjusted.
(3) The undistributed portions, if any, of a Director's
Stock Equivalent account or Dividend Account at the
time of death of the Director shall be distributed as
Page 58 of 65
<PAGE> 48
provided in subparagraph (1) above, and at the time
or times provided therein, to such person or persons
or the survivors thereof (including corporations,
unincorporated associations, or trusts) as the
Director may have designated as beneficiary or
beneficiaries in writing delivered to the Plan
Administrator. If, at the time of the death of the
Director, no designation of a beneficiary has been so
delivered, or if a designated beneficiary is no
longer in existence then, any distribution which
otherwise would have been made to such beneficiary
shall be made to the Director's estate.
(4) If there is no effective Registration Statement
covering distributions of common stock of the Company
to a Director hereunder, any sales, transfers, or
other dispositions by the Director or his beneficiary
or beneficiaries of the common stock can be made only
in accordance with the Securities Act of 1933 and the
general rules and regulations promulgated under such
Act by the Securities and Exchange Commission (or
under such other Act or Acts and rules and
regulations regarding the sale, transfer, or other
disposition of securities as may be
Page 59 of 65
<PAGE> 49
then applicable). The Company in its discretion, may
require the Director or his beneficiary to execute
any representations, agreements, assurances or other
documents as may be necessary or desirable under
applicable securities regulations in connection with
any distribution of common stock of the Company
hereunder to the Director or his beneficiary.
(d) The balance of a Participant's Interest Account, including
any separate Interest Account deemed to exist by reason of
disestablishment of the Measuring Fund, shall be paid to
such a Participant (or to his beneficiary or estate) in
annual installments as provided in Article V, by one of the
following methods selected by the Committee:
(i) In annual installments calculated so as to amortize
the balance in such account, together with Plan
Interest credited thereon, in equal annual amounts
over the period elected by the Participant with such
payments being recalculated from time to time to
reflect changes in the Plan Interest Rate;
(ii) In annual installments calculated by dividing the
balance in such account at the Valuation Date next
preceding the payment of the first such installment
by the number of years in the period elected by the
Page 60 of 65
<PAGE> 50
Participant and, with respect to installments
subsequent to the first installment, by adding
thereto interest at the Plan Interest Rate credited
during the preceding year on the unpaid balance in
such Account;
(iii) In annual installments calculated by multiplying the
balance in such Account at the Valuation Date next
preceding the payment of an installment by a
fraction, the numerator of which is one and the
denominator of which is the number of years remaining
in the period elected by the Participant; or
(iv) By such other method as the Committee shall specify.
(e) The balance of a Participant's Measuring Fund shall be paid
to such Participant (or to his beneficiary or estate) in
annual installments as provided in Article V, determined as
follows:
The balance in the Participant's Measuring Fund
Account as of the Valuation Date on or next preceding
the payment of an installment shall be multiplied by
a fraction, the numerator of which is one and the
denominator of which is the number of years remaining
in the period elected by the Participant.
(f) At any time prior to his Termination Date, a Participant
shall have the right to elect to have amounts credited to
his
Page 61 of 65
<PAGE> 51
Measuring Fund Account and Interest Account adjusted as of
the Valuation Date coinciding with or immediately following
the Participant's Termination Date in accordance with the
following provisions:
(i) Such Participant may elect to have all or any part of
the balance in any Measuring Fund Account he may have
debited to such Measuring Fund Account as of such
Valuation Date with the amount so debited being
credited to an Interest Account as of such date. An
amount equal to the amount debited to such
Participant's Measuring Fund Account shall be
withdrawn by the Company from the Measuring Fund.
(ii) Any election under this paragraph (f) shall be
subject to the Company's right to disestablish the
Measuring Fund under paragraph (c) of Article VIII.
(iii) An election by a Participant under this Paragraph (f)
shall be made by written notice to the Plan
Administrator. A Participant may change any such
election by written notice to the Plan Administrator
at any time prior to the dates specified above.
(g) At any time prior to his death a Participant shall have the
further right to have his Account as of the Valuation Date
Page 62 of 65
<PAGE> 52
immediately following his death adjusted in accordance with
the following provisions:
(i) Such Participant may elect to have all or any part of
the balance in any Measuring Fund Account he may have
debited to such Measuring Fund Account as of such
Valuation Date with the amount so debited being
credited to an Interest Account as of such date. An
amount equal to the amount debited to such
Participant's Measuring Fund Account shall be
withdrawn by the Company from the Measuring Fund.
(ii) Any election under this paragraph (g) shall be
subject to the Company's right to disestablish the
Measuring Fund under paragraph (c) of Article VIII.
(iii) An election by a Participant under this paragraph (g)
shall be made by written notice to the Plan
Administrator. A Participant may change any such
election by written notice to the Plan Administrator
at any time prior to his death.
XI. NON-ALIENATION OF BENEFITS. No right or benefit under this Plan
shall be subject to anticipation, alienation, sale, assignment, pledge,
encumbrance, or charge, and any attempt to anticipate, alienate, sell, assign,
pledge, encumber or charge the same shall be void. No right or benefit
hereunder shall in any manner be liable for or subject to the debts, contracts,
liabilities or torts of the person entitled to
Page 63 of 65
<PAGE> 53
such benefit. If any Participant or beneficiary hereunder should become
bankrupt or attempt to anticipate, alienate, sell, assign, pledge, encumber or
charge any right or benefit hereunder, then such right or benefit shall, in the
discretion of the Committee, cease, and in such event, the Employer of the
Participant involved may hold or apply the same or any part thereof for the
benefit of the participant or beneficiary, his or her spouse, children or other
dependents, or any of them, in such manner and in such proportion as the
Committee may deem proper. Notwithstanding the above provisions, an assignment
of benefits under the Plan by an estate in order to complete distribution of
assets and close the estate shall be treated as valid.
XII. AMENDMENT OR TERMINATION OF THE PLAN.
(a) The Board of Directors may terminate this Plan at any time.
(b) The Board of Directors may amend this Plan at any time.
(c) Any amendment or termination of this Plan shall not affect
the rights of Participants or Beneficiaries to payments in
accordance with Article X of amounts standing to the credit
of Participants in their Accounts at the time of such
amendment or termination.
XIII. EFFECTIVE DATE OF PLAN. This plan shall be effective as of
April 30, 1984, for fees deferred after that date.
XIV. PLAN GOVERNED BY LAWS OF SOUTH CAROLINA. This Plan and the
rights of all persons hereunder shall be construed and determined by the laws
of the State of South Carolina.
(As Amended and Restated on August 18, 1994)
Page 64 of 65
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
Page 65 of 65
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF SPRINGS INDUSTRIES, INC., FOR THE PERIOD ENDED
OCTOBER 1, 1994, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-START> JAN-02-1994
<PERIOD-END> OCT-01-1994
<CASH> 482
<SECURITIES> 0
<RECEIVABLES> 361,897
<ALLOWANCES> 8,569
<INVENTORY> 274,922
<CURRENT-ASSETS> 671,361
<PP&E> 1,233,978
<DEPRECIATION> 683,940
<TOTAL-ASSETS> 1,336,020
<CURRENT-LIABILITIES> 303,750
<BONDS> 270,164
<COMMON> 4,428
0
0
<OTHER-SE> 563,092
<TOTAL-LIABILITY-AND-EQUITY> 1,336,020
<SALES> 1,535,738
<TOTAL-REVENUES> 1,535,738
<CGS> 1,222,752
<TOTAL-COSTS> 1,222,752
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 21,228
<INCOME-PRETAX> 67,029
<INCOME-TAX> 28,534
<INCOME-CONTINUING> 38,495
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 38,495
<EPS-PRIMARY> 2.16
<EPS-DILUTED> 2.16
</TABLE>
