Exhibit 10.1

Written Description of Annual Incentive Plan
 
The annual incentive plan is structured to provide potential bonus payments to
the participants based upon an economic value added (EVA) performance
measurement, which is derived from return on capital employed.  The plan was
created pursuant to the Culp Inc. 2015 Equity Incentive plan and provides for
bonuses based upon the EVA of the entire Company in the case of certain
executives, and upon the EVA of one of the Company’s two divisions for other
executives.
 
EVA is calculated under the incentive plan by determining the capital employed
in the portion of the Company that employs the award recipient (the Company or
one of the Company’s two divisions, referred to herein as a “reporting unit’),
and then multiplying the capital employed by a cost of capital (stated as a
percentage) to determine the “capital charge” for each reporting unit.  The sum
of operating income (prior to bonus payments and excluding non-recurring items)
earned by a reporting unit for each month during the fiscal year in excess of
the capital charge for the reporting unit for that month is deemed to be the
economic value added, or EVA, produced by the reporting unit for the year.  To
the extent that EVA is produced by a reporting unit in a fiscal year, a sharing
percentage is used to determine the bonus pool for the award recipients from
that reporting unit.  The bonus pool is divided among the recipients from the
reporting unit in accordance with proportions established by the Compensation
Committee, stated as a target bonus opportunity.  The Committee also establishes
a target amount of EVA for each reporting unit.  The sharing percentage for
award recipients increases if the reporting unit achieves EVA above the target
level.  Bonus amounts are paid in cash.