Exhibit 10.1
Summary Description of The Dixie Group, Inc.
2011 Incentive Compensation Plan/Range of Incentives
as effective on January 31, 2011
 
The following is a description of the Company's 2011 Incentive Plan (“Plan”) for
its executive officer as effective January 31, 2011.
 
Compensatory Arrangements of Certain Officers
Effective January 31, 2011, the Compensation Committee of the Board of Directors
of The Dixie Group, Inc. (the “Company) established the performance goals and
the range of incentives for the Company's 2011 Incentive Compensation Plan (the
“Plan”). The Committee set the goals and range of incentives in accordance with
the terms of the Plan and the performance goals approved by the Company's
shareholders at the annual meeting in 2006.
Pursuant to the Plan, each executive officer will have the opportunity to earn a
Cash Incentive Award, a Primary Long-Term Incentive Award of restricted stock,
and an award of restricted stock denominated as “Career Shares.” In order to
receive any incentive award under the Plan, an executive officer must be
employed by the Company at the time such award is paid. The potential range of
cash incentives and conditions to vesting awards of Primary Long Term Incentive
Shares and Career Shares are described below.
Cash Incentive Awards
For the CEO and all executive officers whose responsibilities are primarily
related to corporate-level administration, the Cash Incentive Award component
provides each participant with the opportunity to earn a cash incentive ranging
from 15% to 75% of such participant's base salary. For executive officers in
this category, 40% of the amount of the Cash Incentive Award is determined based
on the achievement of specified levels of annual earning before interest and
taxes (“EBIT”) for the Company's Residential business operations, as adjusted
for unusual items, 40% of the amount is determined based on achievement of
specified levels of the Company's annual consolidated EBIT, as adjusted for
unusual items, and 20% of the amount is determined based on achievement of
specified levels of the Company's annual EBIT for the Company's contract
operations, as adjusted for unusual items. The Compensation Committee may reduce
the amount of any award by up to 30% of the amount otherwise earned based on the
participant's failure to achieve individual performance goals set by the
Compensation Committee.
For executive officers whose responsibilities are primarily related to one of
the Company's business units, the Cash Incentive Award component provides each
participant with the opportunity to earn a cash incentive ranging from 15% to
75% of such participant's base salary. For executive officers in this category,
50% of the amount of the Cash Incentive Award is determined based on the
achievement of specified levels of their annual business unit EBIT, as adjusted
for unusual items, 25% of the amount is determined based on the achievement of
specified levels of the Company's annual consolidated EBIT, as adjusted for
unusual items, and 25% of the amount is determined based on the achievement of
specified levels of the annual EBIT of the Company's other business units, as
adjusted for unusual terms. The Compensation Committee may reduce the amount of
any award by up to 30% of the amount otherwise earned based on the participant's
failure to achieve individual performance goals set by the Compensation
Committee.
Cash Incentive Awards earned under the Plan will be based on the participant's
base salary as established by the Compensation Committee, and it is anticipated
that such awards will be paid to participants in cash on or prior to March 2,
2012.
Primary Long-Term Incentive Awards and Career Shares
A Primary Long-Term Incentive Award will be made in restricted shares to each
executive officer, the value of which will be equal to 35% of the executive's
base salary plus any Cash Incentive Award paid for such year. Career Shares will
be awarded to each executive officer as an award of restricted stock valued at
20% of such officer's base salary. Such awards will be valued based on the
market price of the Company's common stock at the time of grant of the award;
provided, however, that, for purposes of determining the number of shares to be
issued with respect to 2011, in no event shall the Company's common stock be
valued at an amount less than $5.00 per share.
Primary Long-Term Incentive Awards will vest over 3 years, and Career Shares
will vest when the participant becomes

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(i) qualified to retire from the Company and (ii) has retained the Career Shares
for 24 months following the grant date, subject to accelerated vesting or
forfeiture as described below. For any participant who becomes age 60 (or any
participant who is already age 60 at the time of an award) restricted shares
will vest equally over the stated vesting or retention period (three years in
the case of Primary Long-Term Incentive awards and two years in case of Career
Shares awards); provided, however, that in no case will such awards be issued
later than two and one half months following the year in which such awards vest
or are no longer subject to a substantial risk of forfeiture.
Special Conditions to Awards
The Primary Long-Term Incentive Award will only be made if the minimum corporate
EBIT levels, as adjusted, are attained; Career Share Awards will only be made if
the Company's EBIT, as adjusted, for fiscal 2011 improves over comparable
results for fiscal 2010. Death, disability or a change in control of the Company
will cause immediate vesting of all restricted stock issued as Career Shares and
as Primary Long-Term Incentive Share Awards. Termination without cause will
result in immediate vesting of all Career Share Awards, and acceleration of
vesting of Primary Long-Term Incentive Share Awards to the extent such shares
have been expensed by the Company. Voluntary termination of employment prior to
retirement, or termination of employment for cause will result in the immediate
forfeiture of all unvested wards under the Plan. Upon an executive's retirement,
vesting will accelerate to the extent that the Company has recognized
compensation expense related to the shares. In the event the Plan does not have
enough available shares of common stock to fulfill the stock awards portion of
the Plan, any stock award granted will be subject to the approval of additional
shares by the Company's shareholders.
Compensation Committee Oversight of Payments
The Compensation Committee has the authority to review and certify the
achievement of the performance goals and to administer and interpret the
Incentive Compensation Plan. As set forth above, any award to a participant for
2011 may be reduced, but not increased, by the Compensation Committee in its
sole discretion based on individual performance criteria.
 
 

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