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 certain of the Company’s operating 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
certain of the Company’s operating 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.