By JAY CONLEY
THE ROANOKE TIMES

Archives Reprint

   A retiree from Roanoke County who gave the National D-Day Memorial Foundation $1 million of his savings could turn out to be one of the biggest losers in the foundation's bankruptcy.

    Under an undisclosed deal when Melvin Proffit's donation was announced in March 2001, the foundation agreed to pay Proffit, 83, a $72,000 per year annuity for the rest of his life. Now that the foundation is millions of dollars in debt and has declared bankruptcy, it may be forced to renege on that promise.

    The issue prompted an unusual motion in federal bankruptcy court from the foundation last week. It is pleading with a judge to allow it to continue to make the monthly payments to Proffit.

    Court papers filed by the foundation's attorneys call the $6,056 paid to Proffit monthly the "overwhelming portion of Mr. Proffit's income and support."

    News that the payments are in jeopardy infuriated former D-Day foundation board chairman Bob Slaughter, who negotiated the donation with Proffit, an old friend.

    "We promised him that he would be paid monthly until he died. We're obligated to pay him," Slaughter said. " I don't care what the court says."

    Proffit, a retired Lowe's store manager, gave the foundation more than $1 million in Lowe's stock he had purchased throughout his career with the store. The foundation promptly sold the stock and gave the money to memorial builder Coleman-Adams Construction, which in the spring of 2001 threatened to walk off the job if overdue bills weren't paid.

    There was no restriction on how the foundation would spend Proffit's donation, according to documents obtained by The Roanoke Times. The foundation would pay back Proffit an annual retirement income of about $6,000 a month for the remainder of his life.

    Foundation board members learned late in June, after the resignation of former foundation President Richard Burrow, how dire the organization's finances were.

    It owed $5 million in unpaid bills and had only $40,000 in the bank, foundation president William McIntosh has said.

    The D-Day foundation announced Friday that it had filed for bankruptcy. Under Chapter 11 reorganization guidelines, the foundation's assets are frozen, and there is some question as to whether Proffit will ever be paid.

    It was Slaughter to whom Proffit offered the donation early in 2001, and the two men later signed the agreement that spells out terms of the donation. The monthly payments to Proffit were not guaranteed or insured and were backed only by the "full faith and credit" of the foundation.

    The foundation's attorney, Richard Maxwell, said this week that the foundation's reputation would be "really damaged" if it failed to make the payments to Proffit. That could cost it future donations, Maxwell said.

    Maxwell said he will ask a federal bankruptcy judge Thursday that the foundation be allowed to continue paying Proffit.

    Unless the court agrees to the request, "we wouldn't be able to pay him," Maxwell said.

    Slaughter served with Proffit in the Army during the World War II invasion. Along with a majority of the foundation board last year, Slaughter resigned after McIntosh, the foundation's interim president, announced the multimillion-dollar debt.

    "The last thing I said when I resigned was make sure Bub Proffit gets paid each month," Slaughter said Tuesday. "Bill McIntosh promised me."

    In October 200 0, McIntosh requested authorities to review the foundation's finances under Burrow.

    Burrow has been charged with four counts of fraud related to acquiring state matching funds and a bank loan for the foundation. He has pleaded not guilty to all charges and his federal trial is scheduled for Dec. 9. None of the charges appears to relate to Proffit's donation or the way the donation was spent.

    Burrow did not return a phone call Tuesday seeking comments for this report.

    Proffit said Tuesday that he was aware the foundation filed for bankruptcy but wasn't sure what effect that would have on the payments to him.

    "Nobody [from the foundation] has talked to me about anything," Proffit said.

    Proffit said that, although he has other sources of income to live on, it would be a hardship if he didn't receive the monthly income from the foundation.

    Although he doesn't recall signing the donation agreement, he doesn't plan any legal action against the foundation.

    "An attorney can't help me," Proffit said. "If I don't ever get paid, I donated the money and that's it."

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