AGREEMENT       (Exhibit 10.1)
 
THIS AGREEMENT made the 27th day of December, 2012, between Culp, Inc., a
corporation organized and existing under the laws of the State of North Carolina
(hereinafter called the “Corporation”), Robert G. Culp, III (hereinafter called
the “Employee”), and Robert G. Culp III Irrevocable Trust dated December 11,
2012 (the “Trust”);
 
W I T N E S S E T H:
 
WHEREAS, the Employee is employed by the Corporation; and
 
WHEREAS, the Corporation highly values the long term efforts, abilities, and
accomplishments of the Employee; and
 
WHEREAS, the Corporation and the Employee previously entered into a Split Dollar
Agreement dated February 24, 2003 (the “Insurance Agreement”), pursuant to which
the Corporation agreed to purchase and pay premiums on a policy of life
insurance insuring the Employee and the Employee’s spouse (hereinafter referred
to as the “Policy”); and
 
WHEREAS, the Policy purchased under the Insurance Agreement is ING/Security Life
of Denver (formerly Southland Life Insurance Company) policy number 06 6002
5882, with a face amount of $8,000,000; and
 
WHEREAS, the Employee assigned all of his right, title and interest in and to
the Insurance Agreement and the Policy to the Robert G. Culp, III Irrevocable
Trust Agreement #3 dated December 27, 1993 (the “1993 Trust”) by an agreement
dated February 24, 2003; and
 
WHEREAS, the 1993 Trust assigned all of its right, title and interest in and to
the Insurance Agreement to the Trust by an agreement dated December 21, 2012;
and
 
WHEREAS, the Insurance Agreement contains provisions providing for termination
of the Agreement and purchase of the Policy by the Employee (and his Assignee,
the Trust) prior to the last to die of the Employee or the Employee’s spouse;
and
 
WHEREAS, the Employee, the Trust and Corporation desire to terminate the
Insurance Agreement and to transfer the Policy to the Trust by having the Trust
purchase the Policy from the Corporation, in accordance with the terms of the
Insurance Agreement, and to enter into other arrangements as set forth herein;
 
NOW, THEREFORE, in consideration of the premises and the mutual promises
contained herein, the parties hereto agree as follows:
 
1.           The Insurance Agreement between the Corporation and the Employee,
as assigned to the Trust, is hereby terminated in accordance with the terms of
the Insurance Agreement.
 
2.           The Trust, as Employee’s Assignee, hereby exercises its option to
purchase the policy from the Corporation, as provided in the Insurance
Agreement.  The purchase price for the Policy shall be cash in the amount of the
cash surrender value (CSV) of the Policy, which amount is agreed to be
$625,595.28.  Upon receipt of such amount, the Corporation agrees to transfer
all of its right, title and interest in and to the Policy to the Trust, by the
execution and delivery of an appropriate instrument of transfer.
 
 
 

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3.           In recognition of termination of the Insurance Agreement, of
suspended premium payments during a portion of the period covered by the
Insurance Agreement, and in recognition of Employee’s continuing valuable
services to the Corporation, the Corporation agrees that during the period of
Employee’s continued employment with the Corporation, but in no event for a
period longer than twelve (12) years from the date hereof, the Corporation will
make an annual payment to the Employee in the amount of $60,000 per year.  Such
payments will be treated as regular compensation to Employee and will be subject
to tax withholding and other similar requirements.
 
4.           Except as expressly provided herein, the Corporation, the Employee
and the Trust will have no further obligations under the Insurance Agreement.
 
5.           This Agreement may not be amended, altered or modified, except by a
written instrument signed by the parties hereto, or their respective successors
or assigns.
 
6.           This Agreement shall be binding upon and inure to the benefit of
the Corporation and the Trust and their respective successors and assigns, and
the Employee, his successors, assigns, heirs, executors, administrators, and
beneficiaries.
 
7.           This Agreement and the rights of the parties hereunder, shall be
governed by and construed in accordance with the laws of the State of North
Carolina.
 
IN WITNESS WHEREOF, the parties hereto have executed this Agreement, as of the
day and year first above written.
 

 
CULP, INC.
     
By:
/s/ Franklin N Saxon
 
Title:
President and Chief Executive Officer
        /s/ Robert G. Culp, III                                              
(SEAL)  
Robert G. Culp, III, EMPLOYEE
         
ROBERT G. CULP III IRREVOCABLE TRUST
DATED DECEMBER 11, 2012
 
By:
Atlantic Trust Company, Trustee
       
 
By:        /s/ W. Scott Thompson
 
 
Title:     Managing Director